AUTOMOTIVE STAMPINGS and ASSEMBLIES LIMITED (Originally Incorporated As a Public Limited Company Under the Companies Act, 1956 on March 13, 1990 As JBM Tools Limited

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DRAFT LETTER OF OFFER Dated July 10, 2008 For Equity Shareholders of the Company Only

AUTOMOTIVE STAMPINGS AND ASSEMBLIES LIMITED (Originally incorporated as a public limited company under the Companies Act, 1956 on March 13, 1990 as JBM Tools Limited. Subsequently, on August 1, 2003, the name was changed to Automotive Stampings and Assemblies Limited) Registered Office: G-71/2, MIDC Industrial Area, Bhosari, Pune 411 026 Tel: +91 20 6631 4300 Fax: +91 20 2712 3147 E-mail: [email protected] Website: www.autostampings.com (The Registered Office of Our Company was shifted from Chiranjiv Tower, 43, Nehru Place, New Delhi 110 019 to 703B-704, 89, Hemkunt Chambers, Nehru Place, New Delhi 110 019 effective July 1, 1998. It was further shifted from 703B-704, 89, Hemkunt Chambers, Nehru Place, New Delhi 110 019 to its present location at G-71/2, MIDC Industrial Area, Bhosari, Pune 411 026 effective June 8, 2001) Contact Person: Mr. Shailendra Dindore, Company Secretary and Compliance Officer

ISSUE OF [] FULLY PAID-UP EQUITY SHARES OF RS 10 EACH FOR CASH AT A PRICE OF RS. [] (INCLUDING A SHARE PREMIUM OF RS. []) PER EQUITY SHARE AGGREGATING UP TO RS. 350.00 MILLION ON RIGHTS BASIS TO THE EXISTING EQUITY SHAREHOLDERS OF OUR COMPANY IN THE RATIO OF [] FULLY PAID-UP EQUITY SHARE FOR EVERY [] FULLY PAID-UP EQUITY SHARES HELD ON THE RECORD DATE, i.e. []. THE FACE VALUE OF THE EQUITY SHARES IS RS. 10 PER EQUITY SHARE. THE ISSUE PRICE OF RS. [] IS [] TIMES THE FACE VALUE OF THE EQUITY SHARES.

GENERAL RISKS Investments in equity and equity related securities involve a degree of risk and investors should not invest any funds in this Issue unless they can afford to take the risk of losing their investment. Investors are advised to read the Risk Factors carefully before taking an investment decision in this Issue. For taking an investment decision, investors must rely on their own examination of the Issuer and the Issue including the risks involved. The securities have not been recommended or approved by the Securities and Exchange Board of India (SEBI) nor does SEBI guarantee the accuracy or adequacy of this document. Investors are advised to refer to “Risk Factors” beginning on page ii of the Draft Letter of Offer before making an investment in the Issue. ISSUER’S ABSOLUTE RESPONSIBILITY The Issuer, having made all reasonable inquiries, accepts responsibility for and confirms that the Draft Letter of Offer contains all information with regard to the Issuer and the Issue, which is material in the context of the Issue, that the information contained in the Draft Letter of Offer is true and correct in all material aspects and is not misleading in any material respect, that the opinions and intentions expressed herein are honestly held and that there are no other facts, the omission of which makes the Draft Letter of Offer as a whole or any such information or the expression of any such opinions or intentions misleading in any material respect. LISTING The existing Equity Shares of our Company are listed on Bombay Stock Exchange Limited (“BSE”) and National Stock Exchange of India Limited (“NSE”). We have received in-principle approval from all these Stock Exchanges for listing of Equity Shares arising from the Issue vide their letters dated [] and [] respectively. For the purpose of the Issue, the Designated Sock Exchange is [].

LEAD MANAGER TO THE ISSUE REGISTRAR TO THE ISSUE

YES Bank Limited Intime Spectrum Registry Limited Nehru Centre, 12th Floor, C-13, Pannalal Silk Mills Compound, Discovery of India, Dr. A.B.Road, Worli, Mumbai 400 018 LBS Road, Bhandup (West) Tel: + 91 22 6669 9144/ 9284 Mumbai 400 078 Fax: + 91 22 2497 4158 Tel: +91 22 2596 0320 Email id: [email protected] Fax: +91 22 2596 0329 Investors’ Grievances Email id: [email protected] Email: [email protected] Contact Person: Mr. Gautam Badalia/ Mr. Mayur Sarma Contact Person: Ms. Awani Thakkar Website: www.yesbank.in Website: www.intimespectrum.com SEBI Registration No.:MB / INM000010874 SEBI Registration No.: INR000003761

ISSUE PROGRAMME ISSUE OPENS ON LAST DATE FOR RECEIVING REQUEST ISSUE CLOSES ON FOR SPLIT FORMS

[], 2008 [], 2008 [], 2008

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TABLE OF CONTENTS

OVERSEAS SHAREHOLDERS a SECTION I: DEFINITIONS & ABBREVIATIONS d DEFINITIONS & ABBREVIATIONS d CERTAIN CONVENTIONS - PRESENTATION OF FINANCIAL INFORMATION AND USE OF h MARKET DATA SECTION II: RISK FACTORS i FORWARD-LOOKING STATEMENTS i RISK FACTORS ii SECTION III: INTRODUCTION 1 SUMMARY INDUSTRY OVERVIEW 1 SUMMARY BUSINESS OVERVIEW 2 SUMMARY FINANCIAL INFORMATION 6 THE ISSUE 11 GENERAL INFORMATION 12 CAPITAL STRUCTURE 19 OBJECTS OF THE ISSUE 27 BASIC TERMS OF THE ISSUE 34 BASIS FOR ISSUE PRICE 35 STATEMENT OF TAX BENEFITS 37 SECTION IV: ABOUT US 54 INDUSTRY OVERVIEW 54 OUR BUSINESS 64 REGULATIONS AND POLICIES 81 OUR HISTORY AND MAIN OBJECTS 87 OUR MANAGEMENT 90 PROMOTER 113 OUR GROUP COMPANIES 120 RELATED PARTY TRANSACTIONS 144 DIVIDEND POLICY 145 SECTION V: FINANCIAL STATEMENTS 146 AUDITORS’ REPORT 146 MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND 181 RESULTS OF OPERATIONS SECTION VI: LEGAL AND OTHER INFORMATION 195 OUTSTANDING LITIGATIONS AND DEFAULTS 195 GOVERNEMENT/STATUTORY, BUSINESS APPROVALS AND LICENCES 207 OTHER REGULATORY AND STATUTORY DISCLOSURES 217 SECTION VII: ISSUE RELATED INFORMATION 233 SECTION VIII: OTHER INFORMATION 258 MATERIAL CONTRACTS AND DOCUMENTS FOR INSPECTION 258 DECLARATION 260

OVERSEAS SHAREHOLDERS

The distribution of the Draft Letter of Offer and the Issue of Equity Shares on a rights basis to persons in certain jurisdictions outside India may be restricted by legal requirements prevailing in those jurisdictions. Persons in whose possession the Draft Letter of Offer may come are required to inform themselves about and observe such restrictions. Our Company is making this Issue of Equity Shares on a rights basis only to the shareholders of our Company who have an Indian address.

No action has been or will be taken to permit this Issue in any jurisdiction where action would be required for that purpose, except that the Draft Letter of Offer was filed with SEBI for observations and SEBI has given its observations vide its letter dated [●].

Accordingly, the Equity Shares represented thereby may not be offered or sold, directly or indirectly, and the Draft Letter of Offer may not be distributed in any jurisdiction, except in accordance with the legal requirements applicable in such jurisdiction. Receipt of the Draft Letter of Offer will not constitute an offer in those jurisdictions in which it would be illegal to make an offer and, those circumstances, the Draft Letter of Offer must be treated as sent for information only and should not be copied or redistributed. No person receiving a copy of the Draft Letter of Offer in any territory other than in India may treat the same as constituting an invitation or offer to him, nor should he in any event use the CAF. We are making this Issue of Equity Shares on a rights basis only to the shareholders of our Company who have an Indian address. Accordingly, persons receiving a copy of the Draft Letter of Offer should not, in connection with the issue of Equity Shares or the rights entitlements distribute or send the same in or into the United States or any other jurisdiction where to do so would or might contravene local securities laws or regulations. If the Draft Letter of Offer is received by any person in any such territory, or by their agent or nominee, they must not seek to subscribe to the Equity Shares or the rights entitlements referred to in the Draft Letter of Offer.

Neither the delivery of the Draft Letter of Offer nor any sale hereunder, shall under any circumstances create any implication that there has been no change in our Company’s affairs from the date hereof or that the information contained herein is correct as of any time subsequent to this date.

European Economic Area Restrictions

In relation to each Member State of the European Economic Area which has implemented the Prospectus Directive at any relevant time (each, a “Relevant Member State”) our Company has not made and will not make an offer of the Equity Shares to the public in that Relevant Member State prior to the publication of a prospectus in relation to the Equity Shares which has been approved by the competent authority in that Relevant Member State or, where appropriate, approved in another Relevant Member State and notified to the competent authority in that Relevant Member State, all in accordance with the Prospectus Directive, except that it may, with effect from and including the Relevant Implementation Date, make an offer of Equity Shares to the public in that Relevant

Member State at any time:

(a) to legal entities which are authorized or regulated to operate in the financial markets or, if not so authorized or regulated, whose corporate purpose is solely to invest in securities;

(b) to any legal entity which has two or more of (1) an average of at least 250 employees during the last financial year; (2) a total balance sheet of more than €43,000,000 and (3) an annual net turnover of more than €50,000,000, as shown in its last annual or consolidated accounts; or

(c) in any other circumstances which do not require the publication by the Issuer of a prospectus pursuant to Article 3 of the Prospectus Directive.

For the purpose of this provision, the expression an “offer of Equity Shares to the public” in relation to any Equity Shares in any Relevant Member State means the communication in any form and by any means of sufficient information on the terms of the offer and the Equity Shares to be offered so as to enable an investor to decide to purchase or subscribe for the Equity Shares, as the same may be varied in that Member State by any measure implementing the Prospectus Directive in that Member State 18 and the expression “Prospectus Directive” means Directive 2003/71/EC and includes any relevant implementing measure in each Relevant Member State. This European Economic Area selling restriction is in addition to any other selling restriction set out below.

United Kingdom Restrictions

This document is only being distributed to and is only directed at (i) persons who are outside the United Kingdom or (ii) to investment professionals falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the “Order”) or (iii) high net worth entities, and other persons to whom it may lawfully be communicated, falling within Article 49(2)(a) to (d) of the Order (all such persons together being referred to as “relevant persons”). The Equity Shares are only available to, and any invitation, offer or agreement to subscribe, purchase or otherwise acquire such Equity Shares will be engaged in only with, relevant persons. Any person who is not a relevant person should not act or rely on this document or any of its contents.

NO OFFER IN THE UNITED STATES

The rights and the shares of our Company have not been and will not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”), or any U.S. state securities laws and may not be offered, sold, resold or otherwise transferred within the United States of America or the territories or possessions thereof (the ‘‘United States’’ or ‘‘U.S.’’) or to, or for the account or benefit of, “U.S. Persons” (as defined in Regulation S under the Securities Act (‘‘Regulation S’’)), except in a transaction exempt from the registration requirements of the Securities Act. The rights referred to in the Draft Letter of Offer are being offered in India, but not in the United States. The offering to

which the Draft Letter of Offer relates is not, and under no circumstances is to be construed as, an offering of any shares or rights for sale in the United States or as a solicitation therein of an offer to buy any of the said shares or rights. Accordingly, the Draft Letter of Offer and the enclosed CAF should not be forwarded to or transmitted in or into the United States at any time.

Neither our Company nor any person acting on behalf of us will accept subscriptions from any person, or the agent of any person, who appears to be, or who our Company or any person acting on behalf of our Company has reason to believe is, in the United States. Envelopes containing a CAF should not be postmarked in the United States or otherwise dispatched from the United States, and all persons subscribing for Equity Shares and wishing to hold such shares in registered form must provide an address for registration of the Equity Shares in India. We are making this Issue of Equity Shares on a rights basis only to the shareholders of our Company who have an Indian address. Any person who acquires rights or Equity Shares will be deemed to have declared, warranted and agreed, by accepting the delivery of the Draft Letter of Offer, that it is not and that at the time of subscribing for the Equity Shares or the rights entitlements, it will not be, in the United States.

We reserve the right to treat as invalid any CAF which:

i. appears to our Company or our agents to have been executed in or dispatched from the United States;

ii. does not include the relevant certification set out in the CAF headed “Overseas Shareholders” to the effect that the person accepting and/or renouncing the CAF does not have a registered address (and is not otherwise located) in the United States; or

iii. where our Company believes acceptance of such CAF may infringe applicable legal or regulatory requirements; and our Company shall not be bound to allot or issue any Equity Shares or rights entitlement in respect of any such CAF.

Our Company is informed that there is no objection to a United States shareholder selling its rights in India. Rights may not be transferred or sold to any U.S. Person.

SECTION I: DEFINITIONS & ABBREVIATIONS

DEFINITIONS & ABBREVIATIONS

In the Draft Letter of Offer, unless the context otherwise requires, the terms defined and abbreviations expanded herein below shall have the same meaning as stated in this section.

Abbreviations

Abbreviation Full Form AGM Annual General Meeting AoA Articles of Association of the Company AS Accounting Standards issued by the Institute of Chartered Accountants of India ASAL Automotive Stampings and Assemblies Limited BIFR Board for Industrial and Financial Reconstruction BIW Body In White Parts BSE The Bombay Stock Exchange Limited CAD Computer Aided Design CAF Composite Application Form CAGR Compounded Annual Growth Rate CDSL Central Depository Services (India) Limited CEO Chief Executive Officer CESTAT Customs, Excise & Service Tax Appellate Tribunal CFO Chief Financial Officer CIT Commissioner of Income Tax CLRA Centre for Legislative Research and Advocacy CNC Computer Numerical Control CWIP Capital Work in Progress DIN Director Identification Number DP Depository Participant DSE Designated Stock Exchange EBITDA Earnings before Interest, Tax, Depreciation and Amortisation ECS Electronic Clearance System EGM Extra-Ordinary General Meeting EPS Earnings per Share FCD Fully Convertible Debenture FCNR Foreign Currency Non Resident Account FDI Foreign Direct Investment FEMA Foreign Exchange Management Act, 1999 FI Financial Institutions FII(s) Foreign Institutional Investors registered with SEBI under applicable laws FY / Fiscal Financial Year ending March 31 GoI Government of India HoD Head of the Department

Abbreviation Full Form HRA House Rent Allowance HUF Hindu Undivided Family ICAI Institute of Chartered Accountants of India IT Act The Income Tax Act, 1961 and amendments thereto ITAT Income Tax Appellate Tribunal IT Rules The Income Tax Rules, 1962 and amendments thereto LM Lead Manager Mn/mn Million MAT Minimum Alternate Tax MICR Magnetic Ink Character Recognition MS Mild Steel MOA Memorandum of Association MOU Memorandum of Understanding NAV Net Asset Value NEFT National Electronic Fund Transfer NR Non Resident NRI(s) Non Resident Indian(s) NSDL National Securities Depository Limited NSE The National Stock Exchange of India Limited OEM Original Equipment Manufacturer P/E Ratio Price/ Earnings Ratio PAN Permanent Account Number PAT Profit after Tax PBT Profit before Tax RBI Reserve Bank of India RBI Act, 1934 Reserve Bank of India, 1934 and amendments thereto RoC Registrar of Companies RoNW Return on Net Worth RTGS Real Time Gross Settlement SCRA The Securities Contract (Regulation) Act, 1956 and amendments thereto SCRR The Securities Contract (Regulation) Rules, 1957 and amendments thereto SEBI Securities and Exchange Board of India SEBI Act, 1992 Securities and Exchange Board of India Act,1992 and amendments thereto SEBI DIP SEBI (Disclosure and Investor Protection) Guidelines, 2000 issued on Guidelines January 19, 2000 read with amendments issued subsequent to that date SICA Sick Industrial Companies (Special Provisions) Act 1985 TACO Tata AutoComp Systems Limited TBEM Tata Business Excellence Model TIL Tata Industries Limited TPA/tpa Tonnes per Annum UK United Kingdom USA United States of America WTO World Trade Organisation YBL YES Bank Limited

Conventional/General Terms

Term Description “We” or “us” or “Our” Unless the context otherwise requires, refers to Automotive or “ASAL” or “the Stampings and Assemblies Limited, a public limited company Company” or “Our incorporated under the Companies Act, 1956 having its registered Company” or “Issuer” or office at G-71/2, MIDC Industrial Area, Bhosari, Pune 411 026 “Issuer Company”

Promoters Unless the context otherwise requires, the promoters of ASAL refers to: • Tata AutoComp Systems Limited • Gestamp Servicios, S.L. • Tata Industries Limited Promoter Group As defined in Explanation II of Clause 6.8.3.2 (m) of the SEBI DIP Guidelines Group Companies The companies which (i) are promoted by the Promoters of ASAL either through shareholding or Board/management control and (ii) have been incorporated in India and /or have operations in India

Issue Related Terms

Term Definition Act The Companies Act, 1956 and amendments thereto Allotment/ Allotment of Unless the context otherwise requires, issue of Equity Shares pursuant Equity Shares to this issue Allottee The successful applicant to whom the equity shares are being/or have been issued Applicant Any prospective investor who makes an application pursuant to the terms of the Draft Letter of Offer Articles Articles of Association of the Company Auditors M/s Price Waterhouse, Chartered Accountants Bankers to the Issue [●] Board or Board of Board of Directors of Automotive Stampings and Assemblies Limited Directors or a Committee thereof CAN Confirmation of Allocation Note Capital or Share Capital Share Capital of the Company Consolidated Certificate In case of physical certificates, the Company would issue one certificate for the equity shares allotted to one folio Designated Stock [●] Exchange Draft Letter of Offer Draft Letter of Offer dated July 10, 2008 Equity Share(s) or Means the Equity Share of the Company having a face value of Rs. 10 Share(s) each

Term Definition Equity Shareholders / Persons holding Equity Shares of the Company unless otherwise Shareholders specified in the context thereof Face Value Face Value of Equity Shares of the Company being Rs. 10 each First Applicant The Applicant whose name appears first in the Application Form Issue/ Rights Issue Issue of [●] Equity Shares of face value of Rs. 10 each for cash at a Premium of Rs. [●] per Equity Share on Rights Basis to the existing Equity Shareholders of Automotive Stampings and Assemblies Limited in the ratio of [●] Equity Shares for every [●] Equity Shares held on the record date i.e. [●] Issue Closing Date [●] Issue Opening Date [●] Issue Period The period between the Issue Opening Date and the Issue Closing Date inclusive of both days Issue Price Rs. [●] per Equity Share Issue Size [●] Investor(s) Shall mean the holder(s) of Equity Shares of the Company as on the record date i.e. [●] Lead Manager YES Bank Limited Letter of Offer Letter of Offer circulated to Shareholders of our Company Memorandum of The Memorandum of Association of Automotive Stampings and Association/MoA Assemblies Limited Record Date [●] Renouncees Shall mean the persons who have acquired rights entitlement from the equity shareholders Registrar to the Issue or Intime Spectrum Registry Limited Registrar Rights Entitlement The number of Equity Shares that a Shareholder is entitled to in proportion to his/her shareholding in the company as on the record date Shareholder Means an equity shareholder of Automotive Stampings and Assemblies Limited Statutory Auditors M/s Price Waterhouse, Chartered Accountants Stock Exchange(s) Shall refer to BSE and NSE where the shares of the company are presently listed Takeover SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, Regulations/SEBI 1997 and amendments thereto Takeover Code

CERTAIN CONVENTIONS - PRESENTATION OF FINANCIAL INFORMATION AND USE OF MARKET DATA

In the Draft Letter of Offer, the terms “We”, “us”, “Our”, “the Company” or “Our Company”, unless the context otherwise implies, refer to Automotive Stampings and Assemblies Limited.

In the Draft Letter of Offer, unless the context otherwise requires, all references to one gender also refers to another gender.

For additional definitions used in the Draft Letter of Offer, please refer to “Definitions & Abbreviations” on page d of the Draft Letter of Offer.

Financial Data

Unless indicated otherwise, the financial data in the Draft Letter of Offer is derived from the financial statements as of and for the years ended March 31, 2004, 2005, 2006, 2007 and 2008 prepared in accordance with the relevant provisions of the Companies Act, 1956 and restated in accordance with the SEBI Guidelines (hereinafter referred to as the “Financial Statements”), as stated in the report dated April 28, 2008, of our Statutory Auditors, included in the Draft Letter of Offer.

Our Company’s Fiscal year commences on April 1 and ends on March 31, so all references to a particular Fiscal year are to the twelve month period ended March 31 of that year. In the Draft Letter of Offer, any discrepancies in any table between the total and the sums of the amounts listed are due to rounding off.

Currency of Presentation

All references to “India” contained in the Draft Letter of Offer are to the Republic of India, all references to the “US” or the “U.S.” or the “USA”, or the “United States” are to the United States of America, and all references to “UK” or the “U.K.” are to the United Kingdom. All references to “Rupees”, “INR” or “Rs.” are to Indian Rupees, the official currency of the Republic of India, all references to “US$” or “USD” are to United States Dollars, the official currency of the United States of America, all references to “GBP” or “£” are to Great Britain Pounds, the official currency of the United Kingdom, all references to “EURO” or “€” are to the official currency of the European Union.

The Draft Letter of Offer contains certain translations of US$, € and GBP into INR that have been presented solely to comply with requirements of clause 6.9.7.1 of the SEBI DIP Guidelines. These convenience translations should not be construed as a representation that those currency amounts could have been, or can be converted into Indian Rupees, at any particular rate, the rates stated below, or at all. Unless stated otherwise, all convenience translations into INR are based on the following conversion rates sourced from the website www.oanda.com, as on May 30, 2008:

Foreign Currency INR Equivalent

Foreign Currency INR Equivalent USD 42.7958 Euro 66.7036 GBP 84.5965

Unless stated otherwise, throughout the Draft Letter of Offer, all figures have been expressed as Rupees in millions, though certain figures are also expressed in Rupees in thousands, Rupees in lakhs and Rupees in crores.

Market Data

Unless stated otherwise, market and industry data used throughout the Draft Letter of Offer has been obtained from industry publications, Government sources and based on our estimates / assumptions. Industry publications generally state that the information contained in those publications has been obtained from sources believed to be reliable but their accuracy and completeness are not guaranteed and their reliability cannot be assured. Although we believe industry / market data used in the Draft Letter of Offer is reliable, it has not been independently verified.

SECTION II: RISK FACTORS

FORWARD-LOOKING STATEMENTS

We have included statements in the Draft Letter of Offer which contain words or phrases such as “will”, “aim”, “is likely to result”, “believe”, “expect”, “will continue”, “anticipate”, “estimate”, “intend”, “plan”, “contemplate”, “seek to”, “future”, “objective”, “goal”, “project”, “should”, “will pursue” and similar expressions or variations of such expressions, that are “forward looking statements”.

All forward looking statements are subject to risks, uncertainties and assumptions about us that could cause actual results to differ materially from those contemplated by the relevant forward-looking statement. Important factors that could cause actual results to differ materially from our expectations include but are not limited to:

• General economic and business conditions in the markets in which we operate and in the local, regional and national economies; • Increasing competition in or other factors affecting the industry segments in which our Company operates; • Changes in laws and regulations relating to the industries in which we operate; • Our ability to meet our capital expenditure requirements and/or increase in capital expenditure; • Fluctuations in operating costs and impact on the financial results; • Our ability to attract and retain qualified personnel; • Changes in technology in future; • Changes in political and social conditions in India or in countries that we may enter, the monetary policies of India and other countries, inflation, deflation, unanticipated turbulence in interest rates, equity prices or other rates or prices; • The performance of the financial markets in India and globally; and • Any adverse outcome in the legal proceedings in which we are involved.

For a further discussion of factors that could cause our actual results to differ, please refer to “Risk Factors”, “Our Business” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” beginning on page ii, 64 and 181 respectively of the Draft Letter of Offer. By their nature, certain market risk disclosures are only estimates and could be materially different from what actually occurs in the future. As a result, actual future gains or losses could materially differ from those that have been estimated. Neither our Company nor the Lead Manager nor any of their respective affiliates have any obligation to update or otherwise revise any statements reflecting circumstances arising after the date hereof or to reflect the occurrence of underlying events, even if the underlying assumptions do not come to fruition. In accordance with SEBI / Stock Exchanges requirements, our Company and Lead Manager will ensure that investors in India are informed of material developments until the time of the grant of listing and trading permission by the Stock Exchanges for the Equity Shares allotted pursuant to this Issue.

RISK FACTORS

An investment in equity shares involves a high degree of risk. You should carefully consider all the information in the Draft Letter of Offer, including the risks and uncertainties described below, before making an investment in our Equity Shares. If any of the following risks actually occur, our business, results of operations and financial condition could suffer, the price of our Equity Shares could decline, and you may lose all or part of your investment. The financial and other implications of material impact of risks concerned, wherever quantifiable, have been disclosed in the risk factors mentioned below. However, there are a few risk factors where the impact is not quantifiable and hence the same has not been disclosed in such risk factors. The numbering of risk factors has been done to facilitate ease of reading and reference and does not in any manner signify the importance of one risk factor over another.

The Draft Letter of Offer also contains forward looking statements that involve risks and uncertainties. The Company’s actual results could differ materially from those anticipated in these forward statements as a result of certain factors, including the considerations described below and elsewhere in the Draft Letter of Offer. Unless otherwise stated in the relevant risk factors set forth below, we are not in a position to specify or quantify the financial or other risks mentioned herein.

Internal Risk Factors

1. Our Company is involved in a number of legal proceedings

Our Company is involved in certain legal proceedings and claims in relation to certain civil, criminal and taxation matters incidental to our business and operations. We are also subject to claims against us arising from Income tax and excise disputes as well as labour disputes. These legal proceedings are pending at different levels of adjudication before various courts and tribunals. Should any new developments arise, such as a change in Indian law or rulings against us by trial or appellate courts or tribunals, we may need to make provisions in our financial statements, which could increase our expenses and our current liabilities. We can give no assurance that these legal proceedings will be decided in our favour. Any adverse decision may have a significant effect on our business and results of operations.

A classification of the legal proceedings instituted by and against our Company and the monetary amount involved in these cases is given in the following table:

Type of litigation Total number Remarks and amount involved of pending cases Income Tax 3 Rs 0.53 Mn in respect of pending cases before various adjudication and Appellate Authorities

Type of litigation Total number Remarks and amount involved of pending cases Excise Cases 6 Rs 5.41 Mn in respect of pending litigations before various adjudication and Appellate Authorities Labour laws 155 Rs 10.39 Mn, in respect of cases filed by the Contract Labourers of the Company for reinstatement with back wages. Criminal Case 1 Rs. 0.10 Mn, in respect of an accident which took place in the factory premises of the Company.

In addition to the aforementioned litigation, we have also received several Show Cause Notices from various regulatory/governmental authorities. For more information regarding litigation and Show Cause Notices, please refer to “Legal & Other Information” beginning on page 195 of the Draft Letter of Offer.

2. We have received a Show Cause Notice from SEBI

SEBI has issued a Show Cause Notice dated October 10, 2007 to the Company for instituting Inquiry under Rule 4 of SEBI (Procedure for Holding Inquiry and Imposing Penalties by Adjudicating Officer) Rules, 1995 for delayed filing of certain disclosures under Regulations 6(2), 6(4) and 8(3) of the SEBI Takeover Regulations in the year 1997, 1999 and 2000. For further details, please refer to “Legal & Other Information” beginning on page 195 of the Draft Letter of Offer.

3. Cases filed against our Promoters and Group Companies

Tata AutoComp Systems Limited and Tata Industries Limited, our Promoters and some of our Group Companies are involved in certain legal proceedings pending at different levels of adjudication before various courts and tribunals. We can give no assurance that these legal proceedings will be decided in the favour of our Promoter and/or our Group Companies.

For more information regarding litigation, please refer to “Legal & Other Information” beginning on page 195 of the Draft Letter of Offer.

4. Our operating profit has been stagnant over the years. Further, the operating profit margin have been declining over the years

As per our audited financial statements, our operating profit grew marginally to Rs. 189.42 million in Fiscal 2008 from Rs. 185.44 million in Fiscal 2004. Further, during the same period, our operating profit margin has come down to 6.29% from 10.51% as shown in the following table:

iii

(Rs. in Mn) Particulars Fiscal 2008 Fiscal 2007 Fiscal 2006 Fiscal 2005 Fiscal 2004 Net Sales 3,009.87 3,131.85 2,767.97 2,498.84 1,764.02 Operating Profit* 189.42 184.49 170.48 163.88 185.44 Operating Profit 6.29% 5.89% 6.16% 6.56% 10.51% Margin * Earnings (excluding other income) Before Interest, Tax, Depreciation and Amortisation

Though we are hopeful that our operating profit will grow substantially in future and consequently the operating profit margin will also improve, we cannot assure you about the same. If the present trend continues, the value of our Company as a whole and the value of your investment may fall considerably.

5. We are not in compliance with Clause 40A of the Listing Agreement

Currently, the non-Promoter shareholding in our Company is less than the stipulated level of 25%. We have received letters from NSE and BSE seeking information regarding status of compliance with the provisions of Clause 40A of the Listing Agreement. Till date, we have not complied with the said requirement and have therefore, vide our letters dated April 3, 2008 and May 14, 2008, sought extension of time for compliance of Clause 40A of the Listing Agreement.

Since we have not received any further communication from NSE and BSE in this regard, we cannot assure you that our request will be granted. Going forward, if we are unable to comply with the provisions of Clause 40A of the Listing Agreement and directives, if any, of BSE and NSE; we may face regulatory action, including but not limited to delisting of the Equity Shares of our Company.

6. We significantly depend on a single customer

We have a long standing relationship with Tata Motors Limited (“TML”). In Fiscal 2008, Tata Motors Limited accounts for approximately 62 % of our total net sales. Moreover, our new plant at Pantnagar will cater exclusively for TML’s “ACE” project.

We do not have any long term contract with TML and therefore, cannot assure you that we would be able to maintain our sales to TML at the current level neither can we assure that they will continue to source their requirement from us. In the event, if TML decides to procure their requirements from other suppliers, our revenues and profitability may be adversely affected.

7. We are dependent on vendors for supply of raw materials, components and consumables used in the manufacture of our products.

We depend on external suppliers for the supply of raw materials, components and other parts for our products. We currently have seventy four major vendors in India. We generally source our basic raw material, steel, from a limited number of vendors on account

of various economic and logistical considerations. As a result, we have a high vendor concentration. In Fiscal 2008, the share of our top five suppliers was as high as 76.38 % of the total raw materials purchased.

If the vendors increase the prices of raw material and other inputs and we are unable to pass on this increase in cost to our customers, our profitability will be impacted. Historically, in the automotive components industry, the ability to pass on such increased input cost to the customers has been limited.

Further, in the event such vendors discontinue supply or fail to adhere to our technical specifications, quality requirements and delivery schedules for any reason whatsoever, we may have temporary stoppages of production till alternate arrangements are made. Such temporary stoppages may affect our business and profitability. There can be no assurance that we will be in a position to develop an alternate supplier in a timely or cost efficient manner.

8. Our industry is competitive and increased competitive pressure may adversely affect the results of our operations.

The market for automotive component manufacturers is highly competitive, and we expect competition to intensify and increase from a number of sources. We believe that the principal competitive factors in our markets are price, service quality, sales and marketing skills, the ability to manufacture customized products and technological and industry expertise. We face significant competition from several entities located in India and several other countries.

We cater to OEM market and replacement markets for the sheet metal component industry. In this industry, several existing players are present and there are no entry barriers. The market is very price sensitive and we face stiff competition from the unorganized sector that is able to compete at lower prices. We may not be able to match the price provided by the unorganized sector which would limit the growth potential.

Some of the existing and future competitors may have greater financial, personnel and other resources, longer operating histories, a broader range of product offerings, greater technological expertise, more recognizable brand names and more established relationships in industries that we currently serve or may serve in the future.

In addition, some of our competitors may enter into strategic or commercial relationships among themselves or with larger, more established companies in order to increase their ability to address client needs, or enter into similar arrangements with potential clients. Increased competition, our inability to compete successfully against competitors, pricing pressures or loss of market share could have a material adverse effect on our business, results of operations, financial condition and cash flows.

9. We do not have long term contracts with most of our customers

We do not have long term contracts with most of our customers. Typically, we sell our products on the basis of purchase orders. In the absence of any long term contract, we cannot assure you that our present customers will continue to procure their requirement from us. In case they decide not to procure from us, we may not be able to find new customers at a comparable profit margin, or at all. As a result, our business, results of operations and financial condition could suffer.

10. We are subject to risks associated with product warranty, which could adversely affect our business, results of operations and financial condition.

Defects, if any, in some of our products could require us to undertake service actions. These actions could require us to expend considerable resources in correcting these problems and could adversely affect demand for our products. Our Company may also suffer claims for penalties under the conditions of certain contracts. Further, if a vendor fails to meet quality standards, it could expose us to warranty claims. In defending these claims, we could incur substantial costs and receive adverse publicity. As a result, our business, results of operations and financial condition could suffer.

11. If we are unable to implement or manage our growth strategies in a timely manner, our business and results of operations could be adversely affected.

We have adopted certain growth strategies, including the setting up of new plants and capacity expansion of our existing plants. All these new projects involve risks and accordingly, there can be no assurance that we will be able to complete our plans on schedule within budget or at all. If due to changes in market conditions, our operations cannot generate sufficient funds or for any other reason we decide to delay, modify or forego some aspects of our growth strategies, our future results of operations may be adversely affected.

12. The objects of the Issue for which funds are being raised have not been appraised by any bank or financial institution. The deployment of funds in the project is entirely at our discretion, based on the parameters as mentioned in “Objects of the Issue”.

The fund requirement and deployment, as mentioned in the “Objects of the Issue” beginning on page 27 of the Draft Letter of Offer, is based on the estimates of our project department and has not been appraised by any bank or financial institution. The fund requirement as detailed below is based on our current business plan. We cannot assure that the current business plan will be implemented in its entirety. In view of the highly competitive and dynamic nature of the industry in which we operate, we may have to revise our business plan from time to time and consequently our fund requirement. The deployment of the funds towards the objects of the Issue is entirely at the discretion of our Board of Directors and is not subject to monitoring by external independent agency.

Further, we cannot assure that the actual costs or schedule of implementation of the proposed manufacturing facility will not vary from the estimated costs or schedule of implementation, and such variance may be on account of one or more factors, some of which may be beyond our control.

13. We are yet to make arrangements for the procurement of plant and machinery worth Rs. 180.14 million aggregating to 18.20 % of the cost of the project

As of now, we have not yet entered into any definitive agreements or placed orders for machinery worth Rs. 180.14 million. As a result, at the time of placing the orders for the aforementioned machinery, the price of the said machinery may vary from the price estimated by us and hence the total fund requirement for the projects may increase which in turn may impact the total project cost, financial condition, results of operation and liquidity position adversely.

14. Setting up of new production facility and commencement of operation of the same are contingent upon obtaining of certain statutory approvals by us.

We require certain statutory approvals for setting up of our new production facility at Chennai. Further, on setting up the said manufacturing facility, we will also be required to obtain certain other approvals to commence operation at the Chennai plant. Delay in, or non-receipt of the requisite approvals, may force us to find a new location for the new production facility, impact the project cost and implementation schedule, which in turn may adversely impact the future growth of our business and results of our operations.

15. Our future growth will be contingent upon our ability to finance our working capital requirements.

Our business is working capital intensive. Historically, we met our working capital requirement through bank borrowings since in some of the yesteryears, our operational cash flow was not sufficient enough to run our operations.

Since we propose to increase the capacity of our existing plant and setup new plants, our working capital requirement is expected to increase on commencement of operation of the additional capacity. Further, if our average credit period gets reduced and/or our collection period increases for any reason whatsoever, our working capital requirement will increase for the given scale of operations. We cannot assure you that we will be able to raise funds from external sources at a competitive rate or at all to finance the increased working capital requirement which in turn may adversely affect our future growth.

16. Our inability to attract, recruit and retain skilled personnel could adversely affect our business and results of operations.

Our ability to meet future business challenges depends on our ability to attract, recruit and retain talented and skilled personnel. We are highly dependent on our senior management, our Directors and other key personnel, including skilled project management personnel. A significant number of our employees are skilled engineers and we face strong competition to recruit and retain skilled and professionally qualified staff. Due to the limited pool of available skilled personnel, competition for senior management and skilled engineers in our industry is intense. We may experience difficulties in attracting, recruiting and retaining an appropriate number of managers and engineers for our business needs. We may also need to increase our pay structures to attract and retain such personnel. Our future performance will depend upon the continued vii

services of these persons. The loss of any of the members of our senior management, our Directors or other key managerial personnel or an inability to manage the attrition levels in different employee categories may materially and adversely impact our business and results of operations.

17. The attrition rate in our Company is high

The attrition rate in our Company has historically been high. Though we have been taking steps to arrest this trend, we cannot assure you that we will be able to bring down the attrition rate. In case we cannot bring down the attrition rate, we will be required to allocate greater resources for training of new personnel which could have an adverse impact on our financial condition.

18. Work stoppages and other labour related problems could adversely affect our business.

Wage costs in India have historically been significantly lower than wage costs in other western countries, which has been one of our competitive advantages. However, by and large, wages in India are increasing at a faster rate than in the developed countries, which may reduce our competitive advantage in relation to pricing. We may need to increase the levels of employee compensation more rapidly than in the past to attract necessary talent. If we are unable to negotiate with the workmen or the contractors, it could result in work stoppages or increased operating costs as a result of higher than anticipated wages or benefits.

Further, we have labour unions at our manufacturing units at Bhosari and Chakan. If there is any dispute between the unions and the management, it might affect the operations and profitability.

19. We have certain contingent liabilities

As per our audited Balance Sheet as on March 31, 2008, contingent liabilities are as follows:

Particulars Rs. in Mn Bills discounted not matured 578.40

In the event the above contingent liability materializes, it may have an adverse affect on our financial performance.

20. We have had negative cashflows in some of the years

In some of the earlier years, we had a negative cash flow primarily because of our investment activities as shown in the following table: (Rs. in Mn)

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Particulars Fiscal Fiscal Fiscal Fiscal Fiscal 2008 2007 2006 2005 2004 Net cash from operating 279.09 185.04 225.91 43.44 157.87 activities Net cash (used in) (541.81) (126.92) (76.23) (208.73) (58.47) investment activities Net cash from/(used in) 275.48 (153.36) (58.45) 171.06 (117.65) financing activities Net increase/(decrease) in 12.76 (95.24) 91.23 5.77 (18.25) cash & cash equivalents

This trend, if it continues, will require us to raise finance from outside, which we may not be able to raise at an economic rate or at all.

21. Our insurance coverage may not adequately protect us against certain operating hazards and this may have a material adverse affect on our business.

Our assets are insured against hazards such as fire, burglary and business interruption. The assets covered include all parts of buildings, all plant and machinery, utilities, office equipments, stocks, finished & semi-finished goods and stores & spares.

While we believe that the insurance coverage which we maintain is reasonably adequate to cover all normal risks associated with the operation of our business, there can be no assurance that any claim under the insurance policies maintained by us will be honoured on time fully or in part. To the extent that we may suffer loss or damage that is not covered by insurance or exceeds our insurance coverage, our results of operations and cash flow may be adversely affected.

22. We may not be able to keep pace with technological changes and develop new products and as a result, our competitive position may suffer

The markets in which our businesses operate can experience significant changes due to the introduction of innovative technologies. To remain competitive and to meet our customers’ needs in these businesses, we must continuously design new products and invest in and develop new technologies or manufacturing processes. Our sales and profits would suffer if we invest in technologies or manufacturing processes that do not function as expected, or if our products become obsolete.

23. Our product offering is limited

Our product offering is limited; we produce only sheet metal components and assemblies for the automotive industry. This segment is highly fragmented and competitive and therefore, offers low profit margin. Further, on account of this limited product portfolio, our ability to exploit various market opportunities, to absorb any shock on account of technological change, increase in raw material price is limited.

24. Our business is dependent on our manufacturing facility and the loss of or shutdown of the facility could adversely affect our business.

A significant portion of our business is dependent on smooth production of sheet metal automotive components at our various factories; and therefore, are subject to various operating risks, such as the breakdown or failure of equipment, power supply or processes, performance below expected levels of output or efficiency, labour disputes, natural disasters, industrial accidents and the need to comply with the directives of relevant government authorities. Any significant operational problem, loss or shutdown of the manufacturing facility for an extended period of time could adversely affect our business, result of operation and financial condition.

25. As a manufacturing business, our success depends on the continuous supply and transportation of our products from our manufacturing units to our customers, which are subject to various uncertainties and risks.

We depend on trucking to deliver our products from our manufacturing facilities to our OEM customers. We rely on third parties to provide such services. Disruptions of transportation services because of weather related problems, strikes, inadequacies in the road infrastructure, or other events could impair our procurement of raw material and our ability to supply our products to our customers. Any such disruption could materially and adversely affect our business, financial condition and results of operations. In addition transportation costs may increase in particular due to rising oil and gas prices. Any material increase in transportation costs may adversely impact our margins as we may not be able to increase our prices to fully recover these cost increase.

26. Most of our existing manufacturing facilities are concentrated in Western India. Any disruption affecting our manufacturing facilities could have a material adverse effect on our business, financial condition and results of operations.

Two of our manufacturing facilities are in Maharashtra and one is in Gujarat. As a result, any localized social unrest, localized political turmoil, natural disaster or breakdown of services and utilities in Western India, especially in Maharashtra, could have material adverse effect on the business, financial position and results of operations of our Company. Further, continuous addition of industries in Maharashtra and Gujarat without commensurate growth of its infrastructural facilities may put pressure on the existing infrastructure therein, which may affect our business. In addition, the spiraling cost of living in Maharashtra and Gujarat may push our manpower costs in the upward direction, which may reduce our margin and cost competitiveness.

The manufacture of sheet metal auto components, involve hazards that could result in fires, explosions, spills, and other unexpected or dangerous conditions or accidents. Manufacturing facilities are subject to operating risks, such as the breakdown or failure of equipment, power supply or processes, performance below expected levels of output, efficiency, obsolescence, labour disputes, strikes, lock-outs, non-availability of services of our external contractors etc. In the event that we are forced to shut down any of our manufacturing facilities for a significant period of time, it would have a material adverse

effect on our earnings, our other results of operations and our financial condition as a whole. Occurrence of accidents at any of our manufacturing facilities may expose our Company to pay compensation and penalty to our workmen and third parties for any losses or damage to human life/health or the environment

27. We enter into Related Party Transactions

During the course of our business, we enter into related party transactions. For more information please refer to “Related Party Transactions” on page 144 of the Draft Letter of Offer.

28. Trading turnover of equity shares of our Company is quite low

The Equity Shares of our Company are listed on BSE and NSE. During last twelve months ending June 30, 2008; our trading turnover on BSE and NSE was 11.45% and 5.49% respectively, which were quite low compared to the average trading turnover on BSE and NSE. This signifies lower investor appetite for our Equity Shares. This condition, if persists, will not be conducive for realizing considerable or any gain on sale of our Equity Shares on stock exchanges.

29. Your holdings may be diluted by additional issuances of Equity Shares. Further, any sales by our Promoters may adversely affect the market price of our Equity Shares.

Any future issuance of our Equity Shares may dilute the holdings of existing investors in our Equity Shares. Additionally, sales of a large number of Equity Shares by our Promoters could adversely affect the market price of our Equity Shares. The perception that any such primary or secondary sale may occur also could adversely affect the market price of our Equity Shares.

30. There were shortfalls in our performance, when compared to the promises made in our last rights issue.

We made a rights issue in the year 1996 and had made certain projections in that issue. We could not achieve those projections. For further details, please refer to “Promise vs Performance” on page 225 of the Draft Letter of Offer.

31. We are bound by certain restrictive covenants provided in the agreements entered into with banks for availing term loans and working capital facilities

As of the date of the Draft Letter of Offer, we have a significant amount of indebtedness. We have entered into agreements with certain banks for short term loans and long term borrowings. As per the signed loan agreements with them, there are certain standard restrictions imposed on us; we require the banks’ permission for effecting any change in our capital structure; formulate any scheme of amalgamation or reconstruction; undertake any new project/schemes, implement any schemes of expansion or acquire fixed assets; invest by way of share capital in or lend or advance funds to or place deposits with any other concern; enter into borrowing arrangement either secured or unsecured with any other bank, financial institution, company or otherwise save and except the working capital facilities granted/to be granted by other consortium-member xi

banks, under consortium arrangement with the bank and the term loans proposed to be obtained from financial institutions/banks for the completion of the replacement-cum-modernization programme; undertake guarantee obligations on behalf of the Company; and declare dividends for any year except out of profits relating to that year after making all due and necessary provisions and provided further that no default had occurred in any repayment obligations; create any charge, lien or encumbrance over its undertaking or any part thereof in favour of any financial institution, bank, company, firm or persons; sell, assign, mortgage or otherwise dispose off any of the fixed assets charged to the bank; enter into any contractual obligation of a long term nature or affecting the company financially to a significant extent; change the practice with regard to remuneration of directors by means of ordinary remuneration or commission, scale of sitting fees, etc; undertake any trading activity other than the sale of products arising out of its own manufacturing operations; and permit any transfer of the controlling interest or make any drastic change in the management set up; monies brought in by the promoters/directors/principal shareholders and their friends and relatives by way of deposits/loans/advances will not be allowed to be repaid by the company without the banks prior permission in writing. The aforesaid requirements may restrict our ability to take swift business decisions as required by a dynamic business environment.

32. Some of our Group Companies have incurred losses during the last three years

Some of our Group Companies have incurred losses during the last three years, as set forth in the table below: (Rs. in Mn) Name of the Group Company For the Period ended March 31 2008 2007 2006 Tata AutoComp Mobility Telematics (59.13) (42.43) (42.92) Limited Tata Hendriksons Suspensions Private (11.37) (44.40) N.A. Limited Tata AutoComp GY Batteries Private (338.98) (138.74) (14.88) Limited Tata Visteon Automotive Private (148.62) (138.56) (82.04) Limited Tata Visteon Engineering Private 17.43 22.99 (36.67) Limited TACO Sasken Automotive Electronics (50.50) (11.71) N.A. Private Limited Tata Ficosa Automotive Systems (121.15) (28.78) 13.31 Limited Tata Yazaki Autocomp Limited (57.61) (26.64) 30.84 Tata Advanced Materials Limited (60.66) (26.29) 83.60 * Audited Financials of Fiscal 2008 yet to be adopted by the board of directors

Tata Yazaki Autocomp Limited informed BIFR on March 18, 2008 that it became potentially sick under the provisions of section 23 of SICA.

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For a detailed description of our Group Companies, please refer to “Our Group Companies” beginning on page 120 of the Draft Letter of Offer.

33. There is potential conflict of interest between us and one of our Group Companies

One of our Group Companies, Technical Stampings and Assemblies Limited is also engaged in business similar to that of our Company. This may lead to conflict of interest between our Company and Technical Stampings and Assemblies Limited. Our Promoters may pursue such policies which may be favourable for Technical Stampings and Assemblies Limited but unfavourable for us.

34. Some of the government approvals/licensing arrangements required by us are pending for renewal

We are required to obtain several government approvals/licenses under various statutes like Factories Act, 1948; Air (Prevention and Control of Pollution) Act, 1974 and Rules made thereunder; Water (Prevention and Control of Pollution) Act, 1974 and Rules made thereunder; etc. We have obtained all the requisite approvals/licenses for the conduct of Company’s business, renewals of some of those approvals/licenses. However, some of our approvals/ consents/ licenses have expired; we have applied for renewal of the same, namely renewal of registration as principal employer under Maharashtra Contract Labour (Regulation and Abolition) Rules 1971 for the labourers employed by the Company from the Contractor, consent from Pimpri-Chinchwad Municipal Corporation under Bombay Provincial Municipal Corporations Act, 1949 to start the business of sheet metal auto parts at MIDC, Bhosari, Pune, are pending. Non-renewal of any of these approvals/licenses may impact our business adversely. For further details, please refer to “Government/Statutory, Business Approvals and Licenses” beginning on page 207 of the Draft Letter of Offer.

External Risk Factors

35. A slowdown in economic growth in India could cause our business to suffer

Our performance and growth are dependent on the health of the Indian economy. The economy could be adversely affected by various factors such as political or regulatory action, including adverse changes in liberalization policies, social disturbances, terrorist attacks and other acts of violence or war, natural calamities, interest rates, commodity and energy prices and various other factors. Any slowdown in the Indian economy may adversely impact our business and financial performance and the price of our Equity Shares.

36. Any downgrading of India’s debt rating by an independent agency may harm our ability to raise finance

Any adverse revisions to India’s credit ratings for domestic and international debt by international rating agencies may adversely affect our ability to raise additional financing and the interest rates and other commercial terms at which such additional financing is available. This

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could have a material adverse effect on our capital expenditure plans, business and financial performance and the price of our Equity Shares.

37. Force Majeure events, terrorist attacks and other acts of violence or war involving India, the United States or other countries could adversely affect the financial markets, result in a loss of investor confidence and adversely affect our business, results of operations, financial condition and cash flows

Certain events are beyond our control, such as force majeure events, terrorist attacks, and other acts of violence or war, civil unrest and military activity. Any such event could happen at or otherwise affect one or more of our businesses, which would adversely affect our business, results of operations and financial condition. Moreover, these and other similar events may adversely affect worldwide financial markets and could lead to global economic recession. Such events may also result in a loss of business confidence or have other consequences that could adversely affect our business, results of operations and financial condition. The occurrence of any of the foregoing could therefore adversely affect our financial performance or the market price of the Equity Shares, even if unrelated to any of our projects.

38. An outbreak of an infectious disease or any other serious public health concerns in Asia or elsewhere could have an adverse effect on our business and results of operations

The outbreak of an infectious disease in Asia or elsewhere or any other serious public health concerns such as AIDS could have a negative impact on the economies, financial markets and business activities in the countries in which our end markets are located, which could have an adverse effect on our business.

39. We are subject to regulatory, economic and political uncertainties in India

In the early 1990s, India experienced significant inflation, low growth in gross domestic product and shortages of foreign currency reserves. The Indian government provided significant tax incentives and relaxed certain regulatory restrictions in order to encourage foreign investment in specified industries of the economy. There is no assurance that liberalization policies will continue. Furthermore, the rate of economic liberalization could change, and specific laws and policies affecting technology companies, foreign investment, currency exchange rates and other matters affecting investment in our Equity Shares could also change. Since 1996, the Government of India has changed six times and the current Indian government is a coalition of many parties, some of which may differ from India’s current economic policies. Various factors, including a collapse of the present coalition government due to the withdrawal of support of coalition members, could trigger significant changes in India’s economic liberalization and deregulation policies, disrupt business and economic conditions in India generally and our business in particular. Our financial performance and the market price of our shares may be adversely affected by changes in inflation, exchange rates and controls, interest rates, government of India policies, social stability or other political, economic or diplomatic developments affecting India in the future.

40. Competition may affect our business adversely

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The automotive component supply industry is highly competitive. Some of our large competitors may have greater financial and other resources than us. We cannot assure you that our products will be able to compete effectively with the products manufactured by our competitors. We believe that the principal competitive factors in our market are price, quality and consistency in meeting customer requirements. Sooner or later a consistent expansion in the capacity of sheet metal component industry could create unhealthy competition. Increasing competition may force us to reduce the prices of our products which may reduce the revenues and margins and/or also decrease our market share, either of which could have an impact on the business, financial and operations of our Company.

Risks Relating to the Issue of Securities

41. There are restrictions on daily movements in the price of the Equity Shares, which may adversely affect a shareholder’s ability to sell, or the price at which he can sell, Equity Shares at a particular point in time

We are subject to a daily ‘circuit breaker’ imposed by all stock exchanges in India, which does not allow transactions beyond specified increases or decreases in the price of the Equity Shares. This circuit breaker operates independently of the index-based market-wide circuit breakers generally imposed by SEBI on Indian stock exchanges. The maximum movement allowed in the price of the Equity Shares before the circuit breaker is triggered is determined by the Stock Exchanges based on the historical volatility in the price and trading volume of the Equity Shares. The Stock Exchanges do not inform us of the triggering point of the circuit breaker in effect from time to time, and may change it without our knowledge. This circuit breaker limits the upward and downward movements in the price of the Equity Shares. As a result of this circuit breaker, no assurance can be given regarding your ability to sell your Equity Shares or the price at which you may be able to sell your Equity Shares at any particular time.

42. Our stock price may be volatile, and you may be unable to resell your shares at or above the Issue price or at all

The market price of our Equity Shares after this Issue will be subject to significant fluctuations in response to, among other factors:

• variations in our operating results and the performance of our business; • adverse media reports about us or the automotive components industry; • regulatory developments in our target markets affecting us, our clients or our competitors; • market conditions and perceptions specific to the automotive components industry; • changes in financial estimates by equity research analysts; • loss of one or more significant clients; • the performance of the Indian and global economy; • significant developments in India’s economic liberalization and deregulation policies and the fiscal regime; and • volatility in the Indian and global securities markets.

Many of these factors are beyond our control. There has been recent volatility in the Indian stock markets and our share price could fluctuate significantly as a result of such volatility in the future.

43. You may not receive the Equity Shares that you subscribe for in this Issue until forty two days after the date on which this Issue closes, which will subject you to market risk

The Equity Shares you purchase in this Issue may not be credited to your demat account with depository participants until approximately 42 days from the Issue Closing Date. You can start trading on such Equity Shares only after receipt of listing and trading approvals in respect of these Equity Shares. Since the Company’s Equity Shares are already listed on Stock Exchanges, you will be subject to market risk from the date you pay for the Equity Shares to the date they are listed. Further, there can be no assurance that the Equity Shares allotted to you will be credited to your demat account, or that trading in the Equity Shares will commence within the time periods specified above.

44. Any future issuance of Equity Shares by us or introduction of an employee stock option plan may dilute the investor’s shareholding or adversely affect trading price of the Equity Shares

Any future issuance of Equity Shares by us or introduction of an employee stock option plan and subsequent issue of Equity Shares under that plan could dilute the investor’s shareholding. Additionally, sale of our Equity Shares by the Promoters could also have an adverse affect on the trading price of the Equity Shares. Such events could also impact our ability to raise capital through an offering of our securities. In addition, any perception by investors that such issuances or sales might occur could also affect the trading price of the Equity Shares.

Notes to risk factors:

1. As per our Financial Statements, the net worth for Equity Shareholders of our Company as on March 31, 2008 is Rs. 426.86 million. As per our Financial Statements, the Net Asset Value per Equity Share as on March 31, 2008 is Rs. 41.86.

2. Issue of [●] Equity Shares of the Company for cash at a price of Rs. [●] per Equity Share including a premium of Rs. [●] per Equity Share aggregating upto Rs. 350.00 million to the Equity Shareholders of the Company on rights basis in the ratio of [●] Equity Shares for every [●] Equity Shares held on the Record Date i.e. [●] in terms of the Draft Letter of Offer. The total Issue Price is [●] times of the face value of the Equity Share.

3. We had entered into certain related party transactions as disclosed in the “Related Party Transactions” on page 144.

4. Before making an investment decision in respect of this Issue, you are advised to refer to “Basis for Issue Price” on page 35.

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5. Please refer to “Basis of Allotment” on page 246 for details on basis of allotment.

6. Average costs of acquisition of Equity Shares by our Promoters are as follows:

Average cost of Sl. No. Promoter acquisition per Equity Share (Rs.) 1 Tata AutoComp Systems Limited 49.25 2 Gestamp Servicios, S.L. 94.96 3 Tata Industries Limited 33.29

7. For details of transactions in Equity Shares by our Promoters, Promoter Group and Directors in the last six months, please refer to “Capital Structure” on page 19.

8. For details of interests of our Directors and Key Managerial Personnel, see “Our Management” on page 90. For details of interests of our Promoters and Group Companies, see “Promoters” and “Our Group Companies” on page 113 and page 120, respectively.

9. We and the Lead Manager are obliged to keep the Draft Letter of Offer updated and inform the public of any material change/development till the listing and commencement of trading of the Equity Shares to be issued pursuant to the Draft Letter of Offer.

10. You may contact the Compliance Officer or the Lead Manager for any complaints pertaining to the Issue including any clarification or information relating to the Issue. The Lead Manager is obliged to provide the same to you.

11. For details of all the loans and advances made to any persons or companies in whom our Directors are interested, please refer to “Financial Statements” on page 146.

12. The name of our Company was changed from JBM Tools Limited to Automotive Stampings and Assemblies Limited on August 1, 2003.

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SECTION III: INTRODUCTION

SUMMARY INDUSTRY OVERVIEW

This is only a summary and does not contain all the information that you should consider before investing in our Equity Shares. You should read the entire Draft Letter of Offer, including the information contained in the chapters titled “Risk Factors” and “Financial Statements” and related notes beginning on page ii and 146 of the Draft Letter of Offer before deciding to invest in our Equity Shares.

Globally, the automotive industry is one of the largest industries and is a key driver of the economy. Owing to its deep forward and backward linkages with several key segments of the economy, the automotive industry has a strong multiplier effect on the economy. A sound transportation system plays a pivotal role in the country’s rapid economic and industrial development. The well-developed Indian automotive industry ably fulfils this catalytic role by producing a wide variety of vehicles such as passenger cars, light, medium and heavy commercial vehicles, multi-utility vehicles, scooters, motor-cycles, mopeds, three wheelers, etc.

The automotive industry, comprising of the automobile and the auto component sectors, has made rapid strides since delicensing and opening up of the sector to FDI in 1991. The industry had an investment of about Rs. 500,000 million in 2002-03 which has gone upto Rs. 800,000 million by the year 2007. The automotive industry has already attained a turnover of Rs. 1,650,000 million (34,000 million USD). The industry provides direct and indirect employment to 13.1 million people. The contribution of the automotive industry to GDP has risen from 2.77% in 1992-93 to 5% in 2006-07. The industry is also making a contribution of 17% to the kitty of indirect taxes of the Government.

(Source: Annual Report 2007-08, Ministry of Heavy Industries and Public Enterprises, Government of India)

Today, India is the world’s second largest manufacturer of two wheelers, fifth largest manufacturer of commercial vehicles; manufactures the largest number of tractors in the world and is the fourth largest passenger car market in Asia. The world’s largest manufacturer of two wheelers, Hero Honda, is located in India. What once was a supplier driven market having no more than a handful of vehicular models two decades ago, now offers more than 150 models and variants by way of customer options.

(Source: Annual Report 2007-08, Ministry of Heavy Industries and Public Enterprises, Government of India)

For further information please refer to “Industry Overview” beginning on page 54 of the Draft Letter of Offer.

SUMMARY BUSINESS OVERVIEW

This is only a summary and does not contain all the information that you should consider before investing in our Equity Shares. You should read the entire Draft Letter of Offer, including the information contained in the chapters titled “Risk Factors” and “Financial Statements” and related notes beginning on pages ii and 146 of the Draft Letter of Offer before deciding to invest in our Equity Shares.

We are an experienced and large manufacturer of a range of sheet metal components and assemblies for the automotive industry. We are primarily a Tier I (auto component companies that supply directly to the OEMs) auto components supplier.

Our Company was incorporated in 1990 under the name of JBM Tools Limited, the SK Arya group (“SKA”) being the promoters. In 1997, our Company, pursuant to an agreement between SKA and TACO, was converted into a Joint Venture between TACO, its affiliate TIL and SKA. In April 2002, TACO and TIL bought over SKA’s stake to take its combined holding to 81.35%. Subsequently, TIL transferred its stake (except for 100 shares) to TACO in March 2004 and TACO became the holding company.

In February 2007, in order to benefit from Spanish group Gestamp’s technological expertise, a share purchase agreement dated February 13, 2007 (“Share Purchase Agreement”) was signed between TACO and Gestamp Servicios, S.L. Subsequently, in August, 2007, Gestamp Servicios, S.L. became the joint Promoter of our Company by acquiring 37.49% stake from TACO and 0.01% from public through an open offer made in terms of SEBI Takeover Code.

We are into the production of a wide range of sheet metal components which form about 60% of the weight of a vehicle. The outer part of the chassis of a vehicle is made from sheet metal pressings. Sheet metal sub-assemblies are used in the underbody of the vehicle, exhaust systems, fuel tanks, skin panels, brackets, oil sumps and supporting panels. Our product mix can be broadly classified into three categories: i) components ii) welded assemblies and iii) modules/aggregates. Some of the products manufactured by us are skin panels for cars, trucks and tractors, cabin and BIW parts, suspension parts, underbody parts, fuel tanks and oil sumps.

Our customers are some of the prestigious vehicle manufacturers like Tata Motors Limited, General Motors India Private Limited, Fiat India Private Limited, Mahindra & Mahindra Limited, Piaggio Vehicles Private Limited and John Deere Equipment Private Limited. We also export our products to Ford Motor Company Limited (UK) and R & O East (USA).

Our Company has four plants located at Bhosari (Maharashtra), Chakan (Maharashtra), Halol (Gujarat) and Pantnagar (Uttarakhand). The Pantnagar plant with 17,000 MT pressing capacity has been set up recently for the manufacturing components for Tata Motor Limited’s ACE project.

During the last five Fiscal years, as per our Financial Statements, our net sales have grown from Rs. 1,764.02 million in Fiscal 2004 to Rs. 3,009.87 million in Fiscal 2008 registering a

CAGR of 14.29 %. Details of our net sales and restated PAT, as per our Financial Statements, during the last five Fiscal years are shown in the following table:

(Rs. in Mn) For the year ended March 31 2008 2007 2006 2005 2004 Net Sales 3,009.87 3,131.85 2,767.97 2,498.84 1,764.02 Restated Profit After 44.08 106.38* 40.20 42.42 76.02* Tax * Includes one time pre-tax income of Rs. 101.82 million and Rs. 35.05 million for Fiscal 2007 and Fiscal 2004 respectively on account of gain on prepayment of sales tax deferral loan as per the scheme for Premature Repayment of Sales Tax Deferral Loan .

OUR COMPETITIVE STRENGTHS

We believe that we have the following competitive strengths:

• The Tata Brand Value

Our Company being a part of the USD 29 Billion Tata group (by revenues in Fiscal 2007, excluding Corus financials), gets tremendous respect as a member of the group. As compared to the unorganized players in the sheet metal industry, our association with the Tata group invokes confidence and faith on us in terms of delivery and value systems. It gives us a competitive advantage over our competitors.

• Wide Range of products

Our Company produces a wide range of sheet metal parts, welded sheet metal assemblies and finished products like oil sumps, fuel tanks and suspension parts. With a range of presses, hydraulic and mechanical, single action and double action and other required equipment of international standard, the plants have established capabilities for making complex sheet metal components of different sizes. This wide variety ensures that customers’ needs are fulfilled and enables us to be a one stop solution for OEMs in the automotive sector.

• Integrated production facility

We have state of the art manufacturing facilities, with a wide range of facilities, a highly experienced and technically competent team and well honed process quality, production flow and delivery systems. This arrangement provides us flexibility in meeting varied demands of the customers.

• Financial Strength

The sheet metal components industry is a highly capital intensive industry. Our Company enjoys strong financial and technical support from our promoters namely TACO and

Gestamp. Further, Our Company is one of the few companies in the sheet metal component industry in India which is listed and therefore having access to the capital market.

• Locational proximity to customers

The location of our plants near the automotive hub at Pune helps us to bring down our logistics cost, hence making us more competitive in pricing. Moreover, Pune region, specifically Chakan is fast becoming the ‘Detroit’ of India because a number of automotive OEMs have set/are in the process of setting up plants in the region. Having our largest plant here gives us tremendous benefit in terms of logistics.

• Technical support from Gestamp Group

We are able to constantly innovate on the technology front, and able to quickly adopt new technologies due to technical support from the Gestamp Group, a leading global player. Gestamp has dedicated development and manufacturing facilities for production of metal components and structural systems for the automotive industry.

With many of the leading automotive companies planning to set up or expand operations in India, our Company is poised to leverage on Gestamp’s global relationships and technical expertise in order to emerge as a leading supplier to OEMs’ Indian operations.

Some of the new technologies to be introduced with the help of Gestamp include hot stampings; tailor welded blanks, hydro/roll forming, steel service centre and blanking activities.

OUR BUSINESS STRATEGY

The strategy of our Company involves achieving ‘Customer Intimacy’ through enhancing our engineering capability & operational efficiency. The same is pictographically represented in the following triad:

The key objectives of our Company are derived from this strategic philosophy. These include:

• Improving Customer Satisfaction Scores and Vendor Rating

• Developing product designing, tool designing and manufacturing capabilities to become complete service provider

• Improving net product sales through business development comprising:

- Increasing business with existing customers - Targeting new customers with base similar to that of existing customers

• Improving engineering capability through technical and business support from TACO and Gestamp

• Improving operational efficiency and effecting cost reduction through structured improvement processes and systems

• Improving employee satisfaction scores through developing competencies and retention plans

For further information, please refer to “Our Business” beginning on page 64 of the Draft Letter of Offer.

SUMMARY FINANCIAL INFORMATION

The following table sets forth our selected financial information derived from our Financial Statements as stated in the report of our Statutory Auditors included therewith, in the “Auditors’ Report” beginning on page 146 of the Draft Letter of Offer. The selected financial information presented below should be read in conjunction with our Financial Statements, the notes thereto and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” beginning on page 181 of the Draft Letter of Offer.

Statement of Assets and Liabilities of Automotive Stampings and Assemblies Limited, as Restated

(Currency: Indian Rupee in thousands) Sl. AS AT MARCH 31, Particulars No. 2008 2007 2006 2005 2004 A FIXED ASSETS Gross Block 1,436,147 1,222,302 1,017,971 980,919 835,184 Less: Accumulated Depreciation 744,976 638,819 534,591 440,189 351,258 Net Block 691,171 583,483 483,380 540,730 483,926 Capital Work in Progress (including 394,342 71,676 149,655 108,375 44,260

capital advances) Total 1,085,513 655,159 633,035 649,105528,186

CURRENT ASSETS, LOANS AND B ADVANCES Inventories 313,151 351,920 316,702 344,853 209,610 Sundry Debtors 205,638 254,477 184,549 146,502 120,427 Cash and Bank Balances 20,237 7,478 102,713 11,479 5,700 Loans and Advances 148,733 119,559 84,817 98,927 24,617 Total 687,759 733,434 688,781 601,761360,354

C LIABILITIES AND PROVISIONS Secured Loans 605,010 273,483 185,000 200,000 79,521 Unsecured Loans 18,594 22,064 180,121 174,376 85,350 Current Liabilities 552,759 480,069 403,117 326,182 218,199 Provisions 45,904 65,958 48,486 47,902 36,256 Deferred Tax Liability (Net) 34,142 43,702 46,287 53,427 32,283 Total 1,256,409 885,276 863,011 801,887451,609

D NET WORTH (A+B-C) 516,863 503,317 458,805 448,979 436,931

Sl. AS AT MARCH 31, Particulars No. 2008 2007 2006 2005 2004 E NET WORTH REPRESENTED BY Share Capital 191,985 191,985 221,985 221,985 221,985 Reserves and Surplus 324,878 311,332 236,820 226,994 214,946 Net Worth 516,863 503,317 458,805 448,979 436,931

Statement of Profit and Loss of Automotive Stampings and Assemblies Limited, as Restated

(Currency: Indian Rupee in thousands) Particulars FOR THE YEAR ENDED MARCH 31, 2008 2007 2006 2005 2004 INCOME Net Sales of products manufactured 3,009,871 3,131,849 2,767,967 2,498,843 1,764,019 Other income 15,018 115,965 18,218 6,347 40,638 TOTAL INCOME 3,024,889 3,247,814 2,786,185 2,505,190 1,804,657

EXPENDITURE Raw Material Consumed 2,202,746 2,392,169 1,967,838 1,844,586 1,241,056 Decrease / (Increase) in Stocks 21,018 (7,720) 64,938 (53,463) (39,370) Payments to and Provisions for 221,684 182,154 165,382 143,193 110,437 Employees Manufacturing, Selling and Other 374,468 380,758 399,333 400,645 266,458 Expenses Interest and Finance Charges 23,793 23,359 19,570 13,927 19,701 Depreciation & Amortisation 115,354 108,182 98,277 91,114 74,667

TOTAL EXPENDITURE 2,959,063 3,078,902 2,715,338 2,440,002 1,672,949 PROFIT BEFORE TAX 65,826 168,912 70,847 65,188 131,708

PROVISION FOR TAXATION: Current tax (including wealth tax) 31,066 61,600 28,100 5,199 10,200 Deferred tax Expense / (Credit) (9,500) (2,200) (4,300) 19,814 48,300 Fringe Benefit Tax 1,300 1,207 1,250 - - Excess provision for taxation in - - (650) - - respect of earlier years written back TOTAL 22,866 60,607 24,400 25,013 58,500 NET PROFIT AFTER TAX 42,960 108,305 46,447 40,175 73,208 BEFORE ADJUSTMENTS ADJUSTMENTS: a. Adjustments on account of 1,575 399 370 511 614 changes in Accounting Policies

Particulars FOR THE YEAR ENDED MARCH 31, 2008 2007 2006 2005 2004 b. Other material adjustments (516) (2,705) (8,807) 3,370 4,495 TOTAL OF ADJUSTMENTS 1,059 (2,306) (8,437) 3,881 5,109 TAX IMPACT OF ADJUSTMENTS: a. Current tax impact of adjustments - - - (304) (390) b.Deferred tax impact of 60 385 2,840 (1,330) (1,910) adjustments c.Excess provision (current tax) of - - (650) - - earlier years written back TOTAL OF TAX IMPACT OF 60 385 2,190 (1,634) (2,300) ADJUSTMENTS TOTAL OF ADJUSTMENTS 1,119 (1,921) (6,247) 2,247 2,809 AFTER TAX IMPACT NET PROFIT AS RESTATED 44,079 106,384 40,200 42,422 76,017 Profit and Loss amount at the 65,973 29,461 24,135 16,087 (31,407) beginning of the year Balance available for 110,052 135,845 64,335 58,509 44,610 appropriations, as Restated APPROPRIATIONS Transfer to Capital Redemption - 30,000 - - - Reserve Transfer to General Reserve 7,500 8,000 4,500 4,000 4,000 Dividend on Preference Shares 10,800 11,974 14,400 14,400 21,738 Dividend on Equity Shares 15,298 15,298 12,238 12,238 - Corporate Dividend Tax 4,435 4,600 3,736 3,736 2,785 TOTAL 38,033 69,872 34,874 34,374 28,523 Balance Carried Forward, as 72,019 65,973 29,461 24,135 16,087 Restated

Statement of Cash Flows of Automotive Stampings and Assemblies Limited, as Restated

(Currency: Indian Rupee in thousands) Sl. Particulars For the year ended For the year ended For the year ended For the year ended For the year ended No. March 31,2008 March 31,2007 March 31,2006 March 31,2005 March 31,2004 A CASH FLOW FROM OPERATING ACTIVITIES: Restated Net profit before taxation 66,885 166,606 62,410 69,069 136,817 Adjustments for : Depreciation 113,779 106,607 96,702 89,539 73,092 Interest and financial charges 23,793 23,359 19,570 13,927 19,701 Interest income (1,002) (186) (1,213) (159) (539) Profit on sale of investments (short - (1) (2,496) (1,892) (889) term, non-trade) Dividend on Short Term Non-trade (1,626) (937) (884) - - Investments Profit on sale of assets - (692) - - - Loss on sale / write off of assets 301 135,245 - 128,150 189 111,868 319 101,734 240 91,605

Operating Profit before Working 202,130 294,756 174,278 170,803 228,422 Capital Changes Adjusted for: Trade and other Receivables 18,962 (103,967) (23,938) (100,134) 46,375 Inventories 38,769 (35,218) 28,151 (135,243) (56,132) Trade payables and other liabilities 51,595 109,326 92,279 (46,906) 76,766 80,979 113,520 (121,857) (50,206) (59,963) Cash Generated From Operations 311,456 247,850 255,257 48,946 168,459 Direct taxes (32,366) (62,807) (29,350) (5,503) (10,590) NET CASH FROM OPERATING 279,090 185,043 225,907 43,443 157,869 ACTIVITIES (A)

B CASH FLOW FROM INVESTING ACTIVITIES: Purchase of fixed assets (544,972) (130,038) (81,691) (211,336) (59,942) Proceeds from sale of fixed assets 538 1,999 870 558 49 Dividend on Short Term Non-trade 1,626 937 884 - - Investments

Profit on sale of investments (short - 1 2,496 1,892 889 term, non-trade) Interest received 1,002 186 1,213 159 539 NET CASH USED IN INVESTING (541,806) (126,915) (76,228) (208,727) (58,465) ACTIVITIES (B)

C CASH FLOW FROM FINANCING ACTIVITIES: Interest paid (22,049) (22,076) (18,816) (13,919) (19,681) Redemption of Preference Shares - (30,000) - - - Long Term Loan availed/(paid) (Net) 315,010 75,000 10,000 175,000 (182,780) Sales tax deferral availed/(paid) (Net) (3,470) (158,057) 5,745 89,026 24,772 Other borrowings 16,517 13,483 (25,000) (54,521) 60,038 Equity and Preference Dividend paid (30,533) (31,713) (30,374) (24,523) - (including tax thereon) NET CASH FROM / USED IN 275,475 (153,363) (58,445) 171,063 (117,651) FINANCING ACTIVITIES (C)

Net increase/(decrease) in Cash and 12,759 (95,235) 91,234 5,779 (18,247) Cash equivalents (A) + (B) + ( C) Cash and cash equivalents (Opening 7,478 102,713 11,479 5,700 23,947 Balance) Cash and cash equivalents (Closing 20,237 7,478 102,713 11,479 5,700 Balance)

THE ISSUE

Equity Shares proposed to be issued by our [●] Equity Shares Company on rights basis Rights Entitlement for Equity Shares In the ratio of [●]([●]) fully paid-up Equity Share for every [●]([●]) fully paid-up Equity Shares held on the Record Date Record Date [●] Issue Opens on [●] Issue Closes on [●] Issue Price per Equity Share [●] 10,198,541 Equity Shares Equity Shares outstanding prior to the Issue

Equity Shares outstanding after the Issue [●] Terms of the Issue For more information, please refer to “Issue Related Information” beginning on page 233 of the Draft Letter of Offer

Terms of Payment

Due Date Amount On Rights Issue application 100% of the Issue Price i.e. Rs. [●] per Equity Share, including share premium

GENERAL INFORMATION

Dear Equity Shareholder(s),

Pursuant to the resolutions passed by the Board of Directors of our Company at its meeting held on January 17, 2008, it has been decided to make the following offer to the Equity Shareholders of the Company, with a right to renounce:

ISSUE OF [●] FULLY PAID-UP EQUITY SHARES OF RS.10 EACH FOR CASH AT A PRICE OF RS. [●] (INCLUDING A SHARE PREMIUM OF RS. [●]) PER EQUITY SHARE AGGREGATING TO RS. 350.00 MILLION ON RIGHTS BASIS TO THE EXISTING EQUITY SHAREHOLDERS OF OUR COMPANY IN THE RATIO OF [●] FULLY PAID-UP EQUITY SHARE FOR EVERY [●] FULLY PAID- UP EQUITY SHARES HELD ON THE RECORD DATE, i.e. [●]. THE FACE VALUE OF THE EQUITY SHARES IS RS. 10 PER EQUITY SHARE. THE ISSUE PRICE OF RS. [●] IS [●] TIMES THE FACE VALUE OF THE EQUITY SHARES.

Important

1. This offer is applicable only to those Equity Shareholders whose names appear as beneficial owners in respect of the equity shares held in the electronic form and on the register of members of our Company in respect of the Equity Shares held in physical form as on [●] i.e. the record date fixed in consultation with the Designated Stock Exchange i.e., [●].

2. Your attention is drawn to “Risk Factors” beginning on page ii of the Draft Letter of Offer.

3. Please ensure that you have received the CAF along with the Draft Letter of Offer. In case the original CAF is not received or is lost or misplaced by the Equity Shareholder, the Registrar will issue a duplicate CAF on the request of the Equity Shareholder who should furnish the Registered Folio Number/DP ID/Client ID number and his/her full name and address to the Registrar. Please note that those Applicants who are making the application in the duplicate CAF should not utilize the original CAF for any purpose including renunciation, even if it is received/ found subsequently. In case the original and the duplicate CAFs are lodged for subscription, Allotment will be made on the basis of the duplicate CAF and the original CAF will be ignored.

4. Please read the Draft Letter of Offer and the instructions contained therein and in CAF carefully, before filling in the CAF. The instructions contained in the CAF are an integral part of the Draft Letter of Offer and must be carefully followed. An application is liable to be rejected for any non-compliance with the terms of the Draft Letter of Offer or the CAF.

5. All enquiries in connection with the Draft Letter of Offer or CAF should be addressed to the Registrar to the Issue, Intime Spectrum Registry Limited, quoting the

Registered Folio Number / Depository Participant (DP) number and Client ID number and the CAF numbers, as mentioned in the CAF.

6. The issue will be kept open for a minimum period of thirty days. If extended, it will be kept open for a maximum period of sixty days.

7. The Lead Manager and our Company shall update the Draft Letter of Offer and keep the public informed of any material changes till the listing and trading commences for Equity Shares offered through this Issue.

Issue Programme

The subscription will open upon the commencement of the banking hours and will close upon the close of banking hours on the dates mentioned below:

ISSUE OPENS LAST DATE FOR REQUEST FOR SPLIT ISSUE CLOSES ON APPLICATION FORMS ON [●] [●] [●]

Registered Office of Our Company

Automotive Stampings and Assemblies Limited G-71/2, MIDC Industrial Area Bhosari Pune 411 026 Maharashtra India Tel: +91 20 6631 4300 Fax: +91 20 2712 3147 E-mail: [email protected] Website: www.autostampings.com Registration No.: 25-016314 Company Identification No.: L28932PN1990PLC016314

The equity shares of our Company are listed on BSE and NSE.

Address of Registrar of Companies:

Registrar of Companies, Pune PMT Commercial Building Deccan Gymkhana Pune 411 004

Board of Directors

Sl. Name Age Address No. 1 Mr. Devender S. Gupta 57 years Panorama Co-op Chairman, Non-Executive, Non-Independent Housing Society, Director Ground Floor, 203, Walkeshwar Road , Mumbai 400 006 2 Mr. Francisco José Riberas Mera 43 years 16 Alfonso, Xii Street, Non-Executive, Non-Independent Director Madrid, Spain 28014

3 Mr. Ramesh A. Savoor 63 years 201, Pineview, Non-Executive, Independent Director 9, Edward Road, Bangalore - 560 052 4 Mr. Pradeep Mallick 65 years A/2, Pallonji Mansion, Non-Executive, Independent Director 43, Cuffe Parade, Mumbai 400 005 5 Mr. S. Ramakrishnan 58 years A-701, NCPA Non-Executive, Independent Director Apartments 'A' Block, Nariman Point, Mumbai 400 021 6 Mr. Francisco López Pena 49 years 7, Buho Street, Non Executive, Non-Independent Director Pozuela De Alarcon, Madrid, Spain 28223 7 Mr. Rameshwar S. Thakur 59 years Flat No. 205, Non Executive, Non-Independent Director Burlington, Hiranandani Estate, Patlipada, Thane West Thane 400 607

For further details in relation to our Board of Directors please refer to “Our Management” beginning on page 90 of the Draft Letter of Offer

Company Secretary and Compliance Officer

Mr. Shailendra Dindore Automotive Stampings and Assemblies Limited G-71/2, MIDC Industrial Area, Bhosari, Pune 411 026 Tel: +91 20 6631 4304 Fax: +91 20 2712 3147 E-mail: [email protected] Website: www.autostampings.com

Investors may contact the Compliance Officer for any pre-Issue / post-Issue related matters.

Lead Manager to the Issue

YES Bank Limited Nehru Centre, 12th Floor, Discovery of India, Dr. A.B.Road, Worli, Mumbai 400 018 Tel: + 91 22 6669 9144/9284 Fax: + 91 22 2497 4158 Email id: [email protected] Website: www.yesbank.in Investors’ Grievances Email: [email protected] Contact Person: Mr. Gautam Badalia/ Mr. Mayur Sarma SEBI Registration No.: MB / INM000010874

Legal Advisor for the Issue

M/s ANS Law Associates Advocates & Solicitors 41-A Film Center, 68, Tardeo Road, Mumbai 400 034 Maharashtra, India Tel: +91 22 6660 4761 Fax: +91 22 6660 4763 Contact Person: Mr. Sharad Abhyankar E-mail: [email protected]

Auditors of the Company

M/s Price Waterhouse Chartered Accountants Muttha Towers, 5th Floor, Suite No. 8, Airport Road, Yerwada, Pune 411 006 Maharashtra, India Tel: +91 20 4100 4444 Fax: +91 20 4100 6105

Registrar to the Issue

Intime Spectrum Registry Limited C-13, Pannalal Silk Mills Compound,

L.B.S Marg Bhandup (West) Mumbai 400 078 Tel: +91 22 2596 0320 Fax: +91 22 2596 0329 Toll Free No. : 1800 22 0320 Email: [email protected] Contact Person: Ms. Awani Thakkar Website: www.intimespectrum.com SEBI Registration No.: INR000003761

Note: Investors are advised to contact the Registrar to the Issue/Compliance Officer of our Company in case of any pre-issue/post issue related problems such as non-receipt of CAF/ Draft Letter of Offer/Letters of Allotment/ Equity Share certificate(s)/ refund orders etc.

Bankers to the Issue

[●]

Bankers to the Company

HDFC Bank Limited Corporate Banking Millenium Towers, Bhandarkar Road, Pune 411 004 Maharashtra, India Tel: +91 20 2565 6386 Fax: +91 20 2567 3008 Contact Person: Mr. Hemant Apte E-mail: [email protected]

State Bank of India Industrial Finance Branch Tara Chambers Wakdewadi, Pune- Mumbai Road, Pune 411 004 Maharashtra, India Tel: +91 20 25812326 Fax: +91 20 25818949 Contact Person: Mr. Sanjay Pandit E-mail: [email protected]

Bank of India

Pimpri Branch P O Box No 1101 Pimpri, Pune 411 018 Maharashtra, India Tel: +91 20 2742 6429 Fax: +91 20 2742 0118 Contact Person: Mr. Surinder Malhotra E-mail: [email protected]

Statement of Inter Se Allocation of Responsibilities for the Issue

YES Bank Limited shall be responsible for and shall coordinate the following activities in relation to this Issue:

Sl.No Activities 1 Capital structuring with relative components and formalities such as type of instruments, etc. 2 Drafting and design of the Draft Letter of Offer document and of advertisement/publicity material including newspaper advertisements and brochure / memorandum containing salient features of the Draft Letter of Offer document ensuring compliance with the guidelines for disclosure and investor protection and other stipulated requirements and completion of prescribed formalities with Stock Exchange and SEBI. 3 Marketing of the issue, which will cover, inter alia, formulating marketing strategies, preparation of publicity budget, arrangements for selection of (i) ad-media (ii) Bankers to the Issue (iii) collection centres (iv) distribution of publicity and issue material including CAF and Letter of Offer and deciding on the quantum of issue material. 4 Selection of various agencies connected with the Issue, namely Registrar to the Issue, printers, Bankers to the Issue and advertisement agencies. 5 Follow-up with Bankers to the Issue to get estimates of collection and advising the Issuer about closure of the Issue, based on the correct figures. 6 The post-Issue activities will involve essential follow-up steps, which must include finalisation of basis of allotment / weeding out of multiple applications, listing of instruments and dispatch of certificates and refunds, with the various agencies connected with the work such as Registrar to the Issue, Bankers to the Issue, and bank handling refund business. Even if many of these post-Issue activities would be handled by other intermediaries, the Lead Manager shall be responsible for ensuring that these agencies fulfill their functions and enable him to discharge this responsibility through suitable agreements with the Issuer.

Credit Rating

This Issue being an issue of equity shares, credit rating is not required.

IPO Grading

This Issue being a rights issue, grading is not mandatory.

Debenture Trustee

This Issue being an issue of equity shares, appointment of debenture trustee is not required.

Monitoring Agency

In terms of clause 8.17.1 of the SEBI Guidelines, we are not required to appoint a monitoring agency in relation to the Issue.

Appraising Entity

Not applicable

Book Building Process Details

Not applicable

Underwriting Details

The Company has currently not entered into any standby underwriting arrangement. However, it may enter into such an arrangement for the purpose of Rights Issue at an appropriate time and on such terms and conditions as it may deem fit. In the event, if the company does enter into such an arrangement prior to filing of the Letter of Offer with the Designated Stock Exchange, the Letter of Offer will be updated to reflect the same.

CAPITAL STRUCTURE

The share capital of our Company as on the date of filing of the Draft Letter of Offer with SEBI is set forth below:

Nominal Aggregate Amount Value Particulars (Rs. in (Rs. in Mn) Mn)

Authorised Share Capital 20,000,000 Equity Shares of Rs. 10 each 200.00 16,000,000 Preference Shares of Rs 10 each 160.00

Issued Share Capital 10,198,541 Equity Shares of Rs. 10 each 101.99 9,000,000 Preference Shares of Rs 10 each 90.00

Subscribed and Paid-up Share Capital 10,198,541 Equity Shares of Rs. 10 each 101.99 9,000,000 Preference shares of Rs 10 each 90.00

Present Issue being offered to the Equity Shareholders through the Draft Letter of Offer [●] Equity Shares of Rs. 10 each at a premium of Rs. [●] each [●] [●]

Paid-up Capital after the Issue [●] Equity Shares of Rs. 10 each [●] 9,000,000 Preference shares of Rs 10 each 90.00

Share Premium Account Existing Share Premium Account 194.86 Share Premium Account after the Issue assuming Allotment of all [●] Equity Shares offered

Notes to the Capital Structure

1. Equity Share Capital History

Date of No. of Nominal Issue Consideration Reason for Cumulative Allotment Equity Value Price Allotment Number of Shares (Rs.) (Rs.) Shares March 13, 700 10 10 Cash Subscribers to 700 1990 the Memorandum March 31, 383,200 10 10 Cash Additional Issue 383,900 1993 September 121,300 10 10 Cash Additional Issue 505,200 4, 1993 September 160,000 10 10 Cash Additional Issue 665,200 25, 1993 April 22, 2,534,800 10 10 Cash Initial Public 3,200,000 1994 Offering October 5, 2,560,000 10 30 Cash Conversion of 5,760,000 1996 Part A of FCD issued July 7, 5,760,000 10 42 Cash Preferential 11,520,000 1997 Allotment March 26, 5,480,494 10 21.02 Cash Conversion of 17,000,494 1998 Part B of FCD Issue June 8, (4,778)* 10 NA NA Cancellation of 16,995,716 2001 partly paid up Equity Shares in terms of Scheme of Arrangement u/s 391-394 of the Act and consequential Capital Reduction 1,852* 10 NA NA Partly paid up 16,997,568 Equity Shares consolidated into fully paid up Equity Shares pursuant to the terms of Scheme of Arrangement 20

Date of No. of Nominal Issue Consideration Reason for Cumulative Allotment Equity Value Price Allotment Number of Shares (Rs.) (Rs.) Shares u/s 391-394 of the Act and consequential Capital Reduction (6,799,027)* 10 NA NA Pursuant to the 10,198,541 reduction of Equity Share capital in terms of Scheme of Capital Reduction u/s 101-102 of the Act and Scheme of Arrangement u/s 391-394 of the Act with consequential Capital Reduction

Total number of Shares 10,198,541 *12 (b) of the Scheme of Arrangement under sections 391-394 of the Companies Act, 1956, approved by the Hon’ble Delhi High Court states as follows: “the authorized capital of the Transferor Company as on the Appointed Date was Rs. 200,000,000 divided into 18,000,000 equity shares of Rs. 10 each and 2,000,000 Preference Shares of Rs. 10 each. As on the Appointed Date, the Issued and Subscribed Capital was Rs. 170,004,940 divided into 17,000,494 equity shares of Rs 10 each and paid up capital was Rs. 169,975,677 (with Rs 29,263 as calls on arrears)….. The remaining amount of share capital as already standing paid up by the shareholders upon the cancellation of the unpaid amount of share capital as above shall be consolidated into fully paid up shares of the face value of Rs 10 each and thereafter the such consolidated shares shall be re-issued and allotted to a Director or an Officer of the Transferor Company or any other person in this behalf with the express understanding that such Director or Officer to whom such shares be allotted, shall settle the same in the market at the best available price on one or more lots or by private sale/placement or by public sale/auction as deemed fit (the decision of such Director or Officer as the case may be as to the timing and method of the sale and the price at which such sale has been given effect to, in that behalf shall be placed before the Board of Directors for its final approval)and pay to the Transferor Company, the net sales proceeds thereof, and upon the receipt of the proceeds in respect of each such sale. The transferor company shall then pay each of such members representing the partly paid-up shares as aforesaid, the net sale proceeds of all such shares after defraying therefrom all costs, charges, and expenses of such sale in cash on pro rata basis. The consolidated and re-issued fully paid shares in terms as provided herein shall be entitled to shares in the Transferee Company upon

scheme becoming effective…”

2. The Promoters, the Directors and the Lead Manager have not entered into any buyback/standby arrangement for purchase of Equity Shares of the Company from any person.

3. Gestamp has confirmed full subscription to their entitlement in the present Rights Issue vide their letter dated July 10, 2008. Gestamp reserves the right to subscribe to their entitlement in the Issue either by themselves or combination of entities controlled by them.

TACO has confirmed full subscription to their entitlement in the present Rights Issue vide their letter dated July 10, 2008. TACO reserves the right to subscribe to their entitlement in the Issue either by themselves or combination of entities controlled by them including by subscribing for renunciation if any made within the Promoter Group to another entity forming part of the Promoter Group. In the event of undersubscription, TACO intends to apply for additional Equity Shares, to ensure atleast ninety percent of the Rights Issue is subscribed. Allotment of Equity Shares to TACO for additional Equity Shares in excess of its rights entitlement will not result in change in control of management and will be governed by the regulation 3(1) (b) of SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 1997 and amendments thereof. As such, other than the requirements indicated in “Objects of the Issue” beginning on page 27 of the Draft Letter of Offer, there is no other intention/purpose for the Rights Issue, including any intention to delist the Company, even if, as a result of allotment to TACO, in the Rights Issue, shareholding of TACO in the Company exceeds its current shareholding. TACO intends to subscribe such under subscribed portion as per the relevant provisions of law. Further, in this regard, TACO undertakes to comply with the provisions of Clause 17 of SEBI (Delisting of Securities) Guidelines, 2003.

4. Details regarding top 10 Equity Shareholders

(a) On the date of the Draft Letter of Offer i.e. July 10, 2008

Sl. No. Name of the Shareholder No. of Equity % of total Shares held Shareholding 1 Tata AutoComp Systems Limited 4,473,243 43.86 2 Gestamp Servicios S L 3,824,453 37.50 3 Himalayan India Holdings 230,573 2.26 4 Transportation, Infrastructure and Energy 90,182 0.88 5 Matterhorn Ventures 85,110 0.83 6 GTL Ltd 46,388 0.45 7 Matterhorn Strategic 39,922 0.39 8 Amber Advisory Services Pvt Ltd 38,000 0.37 9 Pinkhem Investments Co. Pvt. Ltd. 38,000 0.37 10 Own Leasing and Finance Pvt Ltd. 36,000 0.35

(b) 10 days prior to the date of the Draft Letter of Offer i.e. June 30, 2008

Sl. Name of the Shareholder No. of Equity % of total No. Shares held Shareholding 1 Tata AutoComp Systems Limited 8,296,180 81.34 2 Himalayan India Holding 230,573 2.26 3 Matterhorn Ventures 141,823 1.39 4 S.C. India 70,812 0.69 5 GTL Limited 47,163 0.46 6 Matterhorn Strategic 39,922 0.39 7 Amit Jain 35,050 0.34 8 Liverpool India Fund 32,574 0.31 9 Foresight Holdings Pvt. Ltd. 27,000 0.26 10 Mulraj P. Mody 26,500 0.25

5. Aggregate Shareholding of Promoters and Directors of the corporate Promoters (assuming full subscription to the entitlement):

Pre-Issue Post-Issue Name of Promoter No. of Shares % of No. of % of shareholding Shares shareholding

Tata AutoComp Systems Limited 4,473,243 43.86 [●] [●] Tata Industries Limited 100 -- [●] [●] Gestamp Servicios S.L. 3,824,453 37.50 [●] [●] Directors of corporate Promoters -- -- [●] [●]

6. Shareholding pattern before and after the Issue is as under (assuming full subscription to the entitlement):

Pre-Issue Post-Issue Sl. % No. of % No. Category No. of Shares Sharehol Shares Shareholdi held ding held ng A. Promoter's holding 1 Promoters - Indian Promoters 4,473,343 43.86 [y] [y] - Foreign Promoters 3,824,453 37.50 [y] [y] 2 Persons acting in Concert ------Total Promoter Holding (1+2) 8,297,796 81.36 [y] [y] B. Non-Promoter Holding 3 Institutional Investors a. Mutual Funds and UTI 420 -- [y] [y] b. Companies, Financial 300 -- [y] [y] Institutions, Insurance Companies (Central/State Government Institutions/Non- Government Institutions) c. FIIs 510,800 5.01 [y] [y] Sub-Total 511,520 5.01 [y] [y] 4 Others a. Private Corporate Bodies 364,389 3.58 [y] [y] b. Indian Public 987,849 9.69 [y] [y] c. Others* 36,897 0.36 [y] [y] Sub-Total 1,389,135 13.63 [y] [y] Total Non-Promoter Holding 1,900,655 18.64 [y] [y] (3+4) GRAND TOTAL (A+B) 10,198,541 100.00 [y] [y] * NRIs, foreign nationals, clearing members etc.

7. The Promoters of the Company, their associates, Promoter Group and the Directors of the Corporate Promoters have not purchased or sold, directly or indirectly, any Equity Share during a period of six months preceeding the date on which the Draft Letter of Offer is filed with SEBI.

8. We have 3,385 Equity Shareholders as on July 10, 2008.

9. No further issue of Equity Shares whether by way of issue of bonus shares, preferential allotment, rights issue or in any other manner will be made by our Company during the period commencing from submission of the Draft Letter of Offer with SEBI until the Equity Shares referred to in the Draft Letter of Offer have been listed or application money is refunded in case of failure of the Issue.

10. We presently do not have any intention or proposal to alter our capital structure for a period of six months from the Issue Opening Date, by way of split/consolidation of the denomination of Equity Shares or further issue of Equity Shares (including issue of securities convertible / exchangeable, directly or indirectly for Equity Shares) whether on preferential basis or otherwise. However, if we go in for acquisitions and joint ventures, our Company might consider raising additional capital to fund such activity or use Equity Shares as currency for acquisition and/or participation in such joint venture.

11. As on the date of the Draft Letter of Offer, our Company does not have any outstanding warrants, options, convertible loan, debenture or any other securities convertible at a later date into Equity Shares, which would entitle the holders to acquire further Equity Shares of our Company.

12. The Equity Shares of our Company are of face value of Rs. 10 each and marketable lot is one Equity Share. At any given time, there shall be only one denomination for the Equity Shares of our Company

13. Our Company shall adhere to the disclosure and accounting norms specified by SEBI from time to time.

14. Our Company has not issued any Equity Share or granted any option under any employee stock purchase scheme or employee stock option scheme.

15. Our Company has not availed of any “bridge loan” which is to be repaid from the proceeds of the Issue.

15. Our Company has not revalued its assets in the last five years preceding the date of the Draft Letter of Offer and has not issued any Equity Shares out of the revaluation reserves at any point of time.

16. Our Company has no partly paid up Equity Shares and no calls in arrears. The entire Issue Price of Rs. [●] per Equity Share is to be paid on application. Hence, there will be no partly paid up Equity Shares arising out of the Issue.

17. Our Company has not capitalized any of its reserves or profits since inception.

18. In terms of loan agreements signed with State Bank of India, HDFC Bank Limited and Bank of India, we are required to obtain prior consent from them for issuing fresh Equity Shares. We have obtained prior sanctions from the aforesaid lenders as stated below:

Name of the Lender Letter Reference No. Letter Date State Bank of India IFB/CR/37 May 26, 2008 HDFC Bank Limited - May 27, 2008 Bank of India PMP/SM/08-09/15 May 30, 2008

19. As per Notification No. FEMA 20/2000-RB dated May 3, 2000 of the RBI, the RBI has given general permission to Indian companies to issue shares on rights basis to Non- Residents. Hence, our Company does not need in-principle permission from RBI for issue of shares on rights basis to Non-Residents, on a repatriable basis.

By virtue of Circular No. 14 dated September 16, 2003 issued by the RBI, overseas corporate bodies (“OCBs”) have been derecognized as an eligible class of investors and the RBI has subsequently issued the Foreign Exchange Management (Withdrawal of General Permission to Overseas Corporate Bodies (OCBs)) Regulations, 2003. Accordingly, OCBs shall not be eligible to subscribe to the Equity Shares. The RBI has however clarified in its circular, A.P. (DIR Series) Circular No. 44, dated December 8, 2003 that OCBs which are incorporated and are not under the adverse notice of the RBI are permitted to undertake fresh investments as incorporated nonresident entities. Thus, OCBs desiring to participate in this Issue must obtain prior approval from the RBI. On providing such approval to our Company at its registered office, the OCB shall receive the Draft Letter of Offer and the CAF.

However, the Equity Shares to be issued through the Rights Issue would be subject to the same conditions, including restrictions in regard to repatriability as are applicable to the original Equity Shares against which right shares are issued. The Board of Directors may agree to such terms and conditions as may be stipulated by RBI while approving the Allotment of Equity Shares, payment of interest etc. to the non-resident shareholders.

20. The Issue will remain open for 30 days. However, the Board will have the right to extend the Issue period as it may determine from time to time but not exceeding 60 days from the Issue Opening Date.

21. Currently, the non-Promoter shareholding in our Company is less than the stipulated level of 25%. We have received letters from NSE and BSE seeking information regarding status of compliance with the provisions of Clause 40A of the Listing Agreement. Till date, we have not complied with the said requirement and have therefore, vide our letters dated April 3, 2008 and May 14, 2008, sought extension of time for compliance of Clause 40A of the Listing Agreement. Till date, we have not received any further communication from NSE and BSE.

OBJECTS OF THE ISSUE

The objects of the Issue are part-financing the fund requirement of the following:

(a) Setting up new unit at Uttarakhand; (b) Setting up new unit at Chennai; (c) Various expansion projects at Bhosari and Chakan; (d) Redemption of preference shares; and (e) General corporate purpose including repayment/prepayment of loans

The main objects clause of our Memorandum of Association and objects incidental to the main objects enable us to undertake our existing activities and the activities for which funds are being raised by our Company through this Issue.

We intend to utilize the proceeds of the Issue after deducting expenses relating to the Issue (“Net Proceeds”) which is estimated at Rs.[y] million for the abovementioned objects.

Total Fund Requirement

The fund requirement described below is based on the estimates of our project department and is not appraised by any bank or financial institution. In view of the dynamic nature of the automotive component industry, our project department and the Company may have to revise its capital expenditure requirements due to variations in the cost structure, changes in estimates, exchange rate fluctuations and external factors, which may not be within the control of the management. This may entail rescheduling or revising the planned capital expenditure for a particular purpose from its planned expenditure at the discretion of our Company’s management.

Sl. Objects of the Issue Fund No. Requirement (Rs. in Mn) 1 Setting up new unit at Uttarakhand 418.50 2 Setting up new unit at Chennai 131.07 3 Various expansion projects at Bhosari and Chakan units 440.07 4 Redemption of preference shares 90.00 5 General corporate purpose including repayment/prepayment of loans [•] TOTAL [•]

As certified by M/s Girish Deshmukh and Associates vide their certificate dated June 10, 2008, we have incurred Rs. 614.22 million for the aforesaid ‘Objects of the Issue’ till April 30, 2008.

Means of Finance

We intend to finance the aforesaid ‘Objects of the Issue’ using the following ‘Means of Finances’:

Sl. No. Means of Finance Amount (Rs. in Mn) 1 Net Proceeds of the Issue [•] 2 Term Loan 560.00 3 Internal Accruals 192.64 Total [•]

In order to ensure timely completion of various projects mentioned in the “Objects of the Issue”, we may use part of our internal accruals to temporarily finance certain capital expenditure planned to be met through Net Proceeds, over and above the amount of internal accruals allocated for the “Objects of the Issue”. We will use Net Proceeds to the same extent to recoup our internal accruals.

The details of term loans as shown in the preceding table are as follows:

Sl. Name of the Bank Sanction letter Amount Amount No. details sanctioned disbursed till (Rs. in Mn) April 30, 2008 (Rs. in Mn) 1 Bank of India Letter no. 500.00 194.66 PMP/SME/AM/052 dated April 5, 2008 2 State Bank of India - 150.00 150.00 Total 650.00 344.66

In light of the above, we confirm that firm arrangements of finance through verifiable means towards at least 75% of the stated ‘Means of Finance’, excluding the amount to be raised through the Issue, have been made.

In case of any variation in the actual utilization of funds earmarked for the “Objects of the Issue” mentioned above, increased fund deployment for a particular activity will be financed through additional debt. If there is any surplus from the “Net Proceeds” after meeting all the above mentioned objects, such surplus proceeds will be used for general corporate purposes. In case of shortfall in the “Net Proceeds” to meet the “Objects of the Issue”, we propose to meet the same through internal accruals and borrowings.

Details of Objects

Setting up new unit at Uttarakhand

In Fiscal 2006, Tata Motors Limited (“TML”), the major customer of the Company launched “ACE” a mini-truck. Initially, the production of the vehicle was carried out at Pune plant of TML. Considering the capacity constraints and increasing demand, TML decided to set up a new unit at Pantnagar, District Udham Singh Nagar, Uttarakhand to cater to this program. The Company has received an order for supply of skin panels for this program at Uttarakhand plant.

Accordingly, the Company planned to set up a plant at Pantnagar, District Udham Singh Nagar, Uttarakhand.

Though the plant has been commissioned in May 2008, some further additional capital expenditure has been planned in Fiscal 2009 in order to buy some additional machinery and to augment proper infrastructural facility.

The detailed breakup of the fund requirement for setting up new plant at Uttarakhand is as follows:

Sl. Particulars Basis of Estimation Estimated cost No. (Rs. in Mn) 1 Land & Land Development Estimates of our project 13.78 department 2 Civil construction Estimates of our project 67.77 department 3 Plant & Machinery Estimates of our project 331.92 department 4 Other equipment Estimates of our project 5.03 department 5 Contingencies Estimates of our project - department TOTAL 418.50

As certified by M/s Girish Deshmukh and Associates vide their certificate dated June 10, 2008, we have incurred Rs. 367.61 million for setting up the unit at Pantnagar, Uttarakhand till April 30, 2008.

Setting up new unit at Chennai

Our Company intends to set up a new plant at Chennai to manufacture Brake Pedal Box and Clutch Pedal Box in order to cater to the requirement of various existing and upcoming automobile projects in and around Chennai including that of Renault Nissan. The Chennai plant is expected to be operational in Fiscal 2010.

The detailed break-up of the fund requirement for setting up new plant at Chennai is as follows:

Sl. Particulars Basis of Estimation Estimated cost No. (Rs. in Mn) 1 Land & Land Development Estimates of our project 25.00 department 2 Civil construction Estimates of our project 46.65 department 3 Plant & Machinery Estimates of our project 48.42 department 4 Other equipment Estimates of our project 11.00

Sl. Particulars Basis of Estimation Estimated cost No. (Rs. in Mn) department TOTAL 131.07

Till April 30, 2008, we have not incurred any capital expenditure for setting up the unit at Chennai.

Various Expansion Projects at Bhosari and Chakan units

Tata Motors Limited (“TML”) is launching a new version of its Indica model. With this, TML will be creating a new platform enabling them to launch more variants on same platform. To standardize the platform, TML is introducing twist beam and sub frame for rear and front suspension for this vehicle. The Company has received an order for twist beam and sub frame, assembly modules, front end module, BIW welded assembly. The Company has planned a capacity expansion at Chakan plant to cater to this program. This will help the Company to move towards complete assemblies as against component supplies.

The capacity expansion planned for the new Indica program has been partially completed in February 2008. Some of the expansion activities have been shifted to Bhosari Unit. The remaining activities of the project are in progress and are expected to be completed during the first half of the current Fiscal.

Further, the Company has also received an order from Fiat India Private Limited for about 53 assemblies for BIW parts for its Linea and Punto programs. Investment will be required mainly in weld shop and material handling facilities for executing this order. The Investment is planned at Chakan plant.

In addition, Capital Expenditure has also been planned at Chakan and Bhosari Units for executing other small projects/Productivity & Capacity Improvement projects and other routine operational matters.

The detailed break-up of the fund requirement for capital expenditure at Bhosari / Chakan unit is as follows:

Sl. Particulars Basis of Estimation Estimated cost No. (Rs. in Mn) 1 Civil construction Estimates of our project 59.98 department 2 Plant & Machinery Estimates of our project 327.26 department 3 Other equipment Estimates of our project 48.56 department 4 Contingencies Estimates of our project 4.27 department TOTAL 440.07

As certified by M/s Girish Deshmukh and Associates vide their certificate, dated June 10, 2008, we have incurred Rs. 246.61 million for capital expenditure at Bhosari and Chakan units till April 30, 2008.

Redemption of Preference Shares

We intend to redeem preference shares held by TACO amounting Rs. 90.00 million using the ‘Means of Finance’ stated above.

General corporate purposes including repayment/prepayment of loans

In accordance with the policies set up by the Board, the Company proposes to retain flexibility in using the remaining “Net Proceeds” for general corporate purposes including repayment/prepayment of loans. In accordance with the policies of the Board, the management of the Company will have flexibility in utilizing Net Proceeds earmarked for general corporate purposes.

The fund requirements and intended use of the “Net Proceeds” as described therein are based on the management estimates. Our management, in response to the competitive and dynamic nature of the industry, may require revising its expenditure plan, fund requirements and external factors which may be beyond the control of our management. Such decisions will be taken by our Board. In case of variations in the actual utilization of funds earmarked for the purposes set forth, increased fund requirements for a particular purpose may be financed by surplus funds, if available, for other purposes as indicated herein. If surplus funds are unavailable, the required financing will be through our internal accruals and/or debt.

Schedule of Implementation

We intend to follow the following ‘Schedule of Implementation’ for the aforesaid “Objects of the Issue”: (Rs. in Mn) Sl. Objects of the Issue Expenditure Expenditure Expenditure Total No. incurred till proposed to proposed to April 30, be incurred be incurred 2008 from May 1, in FY 2010 2008 to March 31, 2009 1 Setting up new unit at 367.61 50.89 - 418.50 Uttarakhand 2 Setting up new unit at - 89.15 41.92 131.07 Chennai 3 Various expansion 246.61 193.46 - 440.07 projects at Bhosari and Chakan units

Sl. Objects of the Issue Expenditure Expenditure Expenditure Total No. incurred till proposed to proposed to April 30, be incurred be incurred 2008 from May 1, in FY 2010 2008 to March 31, 2009 4 Redemption of - 90.00 - 90.00 preference shares 5 General corporate -[●][●] [●] purpose including repayment/prepayment of loans TOTAL 614.22 [●] [●] [●]

Issue Expenses

The Issue related expenses among others include, lead management fee, printing and distribution expenses, legal fees, advertisement expenses and registrar, depository fees and other fees. The estimated Issue expenses are as follows:

Sr. No. Particulars Expenses (Rs. in % of Issue Size % of Issue Mn) Expenses 1 Lead Management Fee [●][●] [●] 2 Advertising & Selling [●][●] [●] expenses 3 Printing, stationary & [●][●] [●] postage 4 Others (Registrar fee, legal [●][●] [●] counsel fee and miscellaneous) Total [●][●] [●]

Interim Use of Proceeds

The management of our Company, in accordance with the policies established by our Board from time to time, will have flexibility to deploy the Net Proceeds. Pending utilization for the purposes described above, our Company intends to invest the Net Proceeds in quality interest bearing liquid instruments including money market mutual funds and deposits with banks, for the necessary duration. Such investments would be in accordance with investment policies approved by our Board from time to time. The Company confirms that pending utilization of the Net Proceeds; it shall not use the Net Proceeds for investments in the equity markets.

Bridge Loan

We have not raised any bridge loan from any bank or financial institution for any amount as at

the date of the Draft Letter of Offer.

Monitoring of Utilization of Funds

In terms of Clause 8.17 of the SEBI Guidelines, the Company is not required to appoint any monitoring agency.

Our Board, through the Audit Committee, will monitor the utilization of the proceeds of the Issue

Further, in terms of Clause 43A of the Listing Agreement, we hereby undertake the following:

(1) We will furnish to the stock exchange on a quarterly basis, a statement indicating material deviations, if any, in the use of proceeds of the Rights Issue from the ‘Objects’ stated in the Draft Letter of Offer; and

(2) We shall furnish the abovementioned information to the stock exchange along with the interim or annual financial results submitted under clause 41 of the Listing Agreement and shall publish in the newspapers simultaneously with the interim or annual financial results, after placing it before the Audit Committee in terms of clause 49.

Further, our Company will disclose the utilization of the Net Proceeds under a separate head in its balance sheet for such fiscal periods till the Net Proceeds have been utilized, clearly specifying the purpose for which such proceeds have been utilized. The Company shall make the disclosures as required under the SEBI DIP Guidelines, the listing agreements with the Stock Exchanges and any other applicable law or regulations, clearly specifying the purposes for which the Net Proceeds have been utilized. The Company will also, in its balance sheet for the applicable fiscal periods, provide details, if any, in relation to all such Net Proceeds that have not been utilized, thereby also indicating investments, if any, of such currently unutilized Net Proceeds.

BASIC TERMS OF THE ISSUE

For more details please refer to “Issue Related Information” beginning on page 233 of the Draft Letter of Offer

BASIS FOR ISSUE PRICE

The Issue price has been determined by our Board of Directors in their meeting dated [●].

Investors should also refer to “Risk Factors” and “Auditor’s Report” beginning on pages ii and 146, respectively, of the Draft Letter of Offer to get a more informed view before making any investment decision.

The face value of the Equity Shares is Rs.10 and the Issue price of Rs. [●] is [●] times the face value.

Qualitative Factors

• Established brand name • Wide range of products • Locational proximity to customers • Integrated production facilities • Technical expertise brought in by Gestamp

For more details on qualitative factors, which form the basis for computing the price, refer to “Our Business” beginning on page 64 of the Draft Letter of Offer.

Quantitative Factors

Information presented in this section is derived from the Financial Statements as stated in the report dated April 28, 2008, of our Statutory Auditors included in the Draft Letter of Offer.

Some of the quantitative factors, which form the basis for computing the price, are as follows:

1. Basic and Diluted Earnings per Share (EPS)

Period Ended Basic and Diluted EPS (Rs.) Weight 2008 3.08 3 2007 9.06 2 2006 2.33 1 Weighted Average 4.95

2. Price Earning Ratio (P/E) in relation to the Issue price of Rs. [●] per share

a) P/E based on Basic and Diluted EPS for the year ended March 31, 2008: [●] times

b) Industry P/E*

i. Highest: 80.9 ii. Lowest: 3.0

iii. Industry Composite: 16.0

* Since there is no separate industry classification for the Sheet Metal Components segment, industry data has been based on the broader Auto Ancillary industry

Source: Capital Market, Vol. XXIII/08, June 16-29, 2008 (Industry: Auto Ancillaries)

3. Return on Networth (RoNW)

Period Ended RoNW (%) Weight 2008 7.37 3 2007 22.36 2 2006 7.02 1 Weighted Average 12.31

4. Minimum Return on Total Net worth after Issue needed to maintain Pre-Issue Basic and Diluted EPS for the year ended March 31, 2008 is [●]

5. Net Asset Value

NAV as at March 31, 2008: Rs. 41.86 per Equity Share

Issue price: Rs. [●] per Equity Share

NAV after the Issue: Rs. [●] per Equity Share

6. Comparison with other listed companies

As there are no direct comparable for our company we have taken into consideration the some of the companies comparable for the category titled “Auto Ancillaries”

Company EPS (Rs.) P/E RoNW (%) NAV (Rs.) FV (Rs.) Automotive Stampings 3.08 [●] 7.37 41.86 10.00 and Assemblies Limited Peer Group Autoline Industries 13.70 10.80 24.90 113.30 10.00 Jay Bharat Maruti 7.30 6.30 24.20 31.0 5.00 JBM Auto 6.50 4.10 18.10 40.40 10.00 Rasandik Engineering 7.60 9.80 15.70 52.80 10.00 Peer Group Average 8.78 7.75 20.73 59.38 --

Source: Capital Market, Vol. XXIII/08, June 16-29, 2008 (Industry: Auto Ancillaries)

The Issue Price of Rs. [●] has been determined by our Board, on the basis of assessment of market demand for the Equity Shares and the same is justified on the basis of the above factors.

STATEMENT OF TAX BENEFITS

To, The Board of Directors Automotive Stampings and Assemblies Limited, G-71/2, MIDC Industrial Area, Bhosari, Pune 411 026.

Dear Sirs,

Statement of Possible Tax Benefits Available to the Company and its shareholders

We hereby report that the enclosed annexure provides the possible tax benefits available to Automotive Stampings and Assemblies Limited (‘ASAL’ or ‘the Company’) and to the shareholders of the Company under the Income-tax Act, 1961 (provisions of Finance Act, 2008) and other applicable direct tax laws, presently in force in India. Several of these benefits are dependent on the Company or its shareholders fulfilling the conditions prescribed under the relevant provisions of the statute. Hence, the ability of the Company or its shareholders to derive the tax benefits is dependent upon fulfilling such conditions.

The benefits discussed in the enclosed statement are not exhaustive. This statement is only intended to provide general information to the investors and is neither designed nor intended to be a substitute for professional tax advice. In view of the individual nature of the tax consequences and the changing tax laws, each investor is advised to consult his or her own tax consultant with respect to the specific tax implications arising out of their participation in the issue.

We do not express any opinion or provide any assurance as to whether:

(i) Company or its shareholders will continue to obtain these benefits in future; or (ii) The conditions prescribed for availing the benefits have been/ would be met with.

The contents of the enclosed statement are based on information, explanations and representations obtained from the Company and on the basis of our understanding of the business activities and operations of the Company.

A shareholder is advised to consider in his/ her/ its own case the tax implications of an investment in the Equity Shares.

This statement is provided solely for the purpose of assisting the Company to which it is addressed in discharging their responsibilities under the Securities and Exchange Board of India (Disclosure and Investor Protection Guidelines, 2000) and paragraph B of Part II of Schedule II to the Companies Act, 1956. Our work has not been carried out in accordance with the auditing standards generally accepted in the United States of America or outside of India and accordingly should not be relied on as if had been carried out in accordance with those standards.

No assurance is given that the revenue authorities/ courts will concur with the views expressed herein. Our views are based on the existing provisions of law and its interpretation, which are subject to change from time to time. We do not assume responsibility to update the views consequent to such changes. We will not be liable to any other person in respect of this statement.

Jeetendra Mirchandani Partner Membership No.F-48125 For and on behalf of

Place: Pune Price Waterhouse Date: 4-June-2008 Chartered Accountants

ANNEXURE

STATEMENT OF POSSIBLE TAX BENEFITS AVAILABLE TO AUTOMOTIVE STAMPINGS AND ASSEMBLIES LIMITED (‘ASAL’ OR ‘THE COMPANY’) AND ITS SHAREHOLDERS

I. SPECIAL TAX BENEFIT

(A) SPECIAL TAX BENEFITS AVAILABLE TO THE COMPANY

There are no special tax benefits available to the Company.

(B) SPECIAL TAX BENEFITS AVAILABLE TO THE SHAREHOLDERS OF THE COMPANY

There are no special tax benefits available to the shareholders of the Company.

II. GENERAL TAX BENEFIT

The Income Tax Act, 1961 (provisions of Finance Act, 2008) and other applicable direct tax laws, presently in force in India, make available the following general tax benefits to companies and to their shareholders. Several of these benefits are dependent on the companies or their shareholders fulfilling the conditions prescribed under the relevant provisions of the statute.

The Company will be entitled to deduction under the sections mentioned hereunder from its total income chargeable to Income-tax.

i. Dividends Exempt Under section 10 (34)

Under section 10 (34) of the Act, Company will be eligible for exemption of income by way of dividend (Interim or final) on shares from domestic Company referred to in section 115-O of the Act.

ii. Income from Units of Mutual Fund exempt under section 10 (35)

The Company will be eligible for exemption of income received from units of mutual funds specified under section 10 (23D) of the Act, income received in respect of units from the Administrator of specified undertaking and income received in respect of units from the specified company in accordance with and subject to the provisions of section 10 (35) of the Act.

iii. Computation of Capital Gains

Capital assets may be categorized as short-term capital assets and long-term capital assets based on the period of holding shares in a Company. Shares held in a Company or listed securities or units of Unit Trust of India(‘UTI’) or units of Mutual Fund specified under section 10 (23D) or zero coupon bonds will be considered as long-term capital assets if they are held for period exceeding 12 months. Consequently, capital gains arising on sale of these assets held for more than 12 months are considered as “Long-term Capital Gains”. Capital gains arising on sale of these assets held for 12 months or less are considered as “Short-Term Capital Gains”.

Section 48 of the Act, which prescribes the mode of computation of Capital Gains, provides for deduction of cost of acquisition/ improvement and expenses incurred in connection with the transfer of a capital asset, from the sale consideration in order to arrive at the amount of Capital Gains. However, in respect of long-term capital gains, it offers a benefit by permitting substitution of cost of acquisition/ improvement with the indexed cost of acquisition/ improvement, which adjusts the cost of acquisition/ improvement by a cost inflation index as prescribed from year to year.

As per the provisions of section 112(1)(b) of the Act, long-term gains as computed above that are not exempt under section 10(38) of the Act would be subject to Income-tax at a rate of 20 percent (plus applicable surcharge, education cess and secondary and higher education cess). However, as per the proviso to section 112 (1), if the tax on long-term capital gains resulting upon transfer of listed securities or units or zero coupon bond, calculated at the rate of 20 percent with indexation benefit exceeds the tax on long-term capital gains computed at the rate of 10 percent without indexation benefit, then such gains are chargeable to tax at concessional rate of 10 percent (plus applicable surcharge, education cess and secondary and higher education cess).

Gains arising on transfer of short-term capital assets are currently chargeable to tax at the rate of 30 percent (plus applicable surcharge, education cess and secondary and higher education cess), at the discretion of assessee. However, as per the provisions of section 111A of the Act, short-term capital gains on sale of equity shares or units of an equity oriented fund on or after 1st October, 2004 where the transaction of such sales is subject to Securities Transaction Tax (“STT”) shall be chargeable to Income-tax at a rate of 10 percent (plus applicable surcharge, education cess and secondary and higher education cess).

Exemption of capital gain from income tax

(i) Under section 10 (38) of the Act, any long-term capital gains arising out of sale of equity shares or units of equity oriented fund on or after 1st October, 2004 will be exempt from tax provided that the transaction of sale of such shares or units is chargeable to STT. However, such income shall be taken into account in computing the book profit and income-tax payable under section 115JB.

(ii) According to the provisions of section 54EC of the Act and subject to the conditions specified therein, long-term capital gains not exempt under section 10 (38) shall not be

chargeable to tax to the extent such capital gains are invested in certain notified bonds within six months from the date of transfer. If only part of the capital gains is so reinvested, the exemption shall be allowed proportionately. In such a case, the cost of such long-term specified assets will not qualify for deduction under section 80C of the Act. However, if the said bonds are transferred or converted into money within a period of three years from the date of their acquisition, the amount of capital gains exempted earlier would become chargeable to tax as long-term capital gains in the year in which the bonds are transferred or converted into money. It is also provided under section 54EC that investments made on or after 1st April 2007 in the said bonds should not exceed fifty lakh rupees during any financial year.

iv. Computation of Business Income:

Subject to the fulfillment of conditions prescribed, the Company will be eligible, inter-alia, for the specified deductions in computing its business income, which are mentioned herein below:-

(i) The Company will be eligible for deduction prescribed under section 80IB/ 80IC of the Act, in view of the fact that certain manufacturing unit/ s of the Company is/ are located in special category states.

(ii) The Company will be eligible for deduction under section 35 (1) (i) and (iv) of the Act, in respect of any revenue or capital expenditure incurred, other than expenditure on the acquisition of any land, on scientific research related to the business of the Company.

(iii)The Company will be eligible for deduction under section 35 (1) (ii), (iia) and (iii) of the Act, in respect of any sum paid to a scientific research association or a Company which has as its object, the undertaking of scientific research or to any approved university, College or other institution to be used for scientific research or for research in social sciences or statistical scientific research to the extent of a sum equal to one and one fourth times the sum so paid.

(iv) Subject to compliance with certain conditions laid down in section 32 of the Act, the Company will be entitled to deduction for depreciation:

• In respect of tangible assets (being buildings, machinery, plant or furniture) and intangible assets (being know-how, patents, copyrights, trademarks, licenses, franchises or any other business or commercial rights of similar nature acquired on or after 1st day of April, 1998) at the rates prescribed under the Income-tax Rules,1962;

• In respect of any new machinery or plant which has been acquired and installed after 31st March 2005 by the Company, a further sum of 20% of the actual cost of such machinery or plant; v. Computation of Tax on Book Profits:

Under section 115JAA (1A) of the Act, tax credit shall be allowed of any tax paid under

section 115 JB of the Act (‘Minimum Alternate Tax’ or ‘MAT’). Credit eligible for carry forward is the difference between MAT paid and the tax computed as per the normal provisions of the Act. Such tax credit shall not be available for set-off beyond 7 years succeeding the year in which the tax credit becomes allowable. The Company shall be eligible to set-off the tax credit, thus carried forward, in the year in which it is required to pay the tax under the regular provisions of the Income-tax Act. The amount which can be set-off is restricted to the difference between the tax payable under the regular provisions of the Act and tax payable under the provisions of section 115JB in that year. vi. Tax Rebates (Tax Credits):

(i) From 1st October, 2004 onwards, as per section 88E of the Act, the STT paid by the shareholder in respect of taxable securities transactions entered into in the course of the business would be eligible for deduction from the amount of Income-tax on the Income chargeable under the head “Profits and gains of business or profession” arising from taxable securities transactions, subject to certain limits specified in the section and also on fulfillment of certain prescribed conditions set out in the said section.

(ii) As per the provisions of Section 90, for taxes on income paid in Foreign Countries with which India has entered into Double Taxation Avoidance Agreements (Tax Treaties from projects/ activities undertaken thereat, the Company will be entitled to the deduction from the Indian Income-tax of a sum calculated on such doubly taxed income to the extent of taxes paid in Foreign Countries. Further, the Company as a tax resident of India would be entitled to the benefits of such Tax Treaties in respect of income derived by it in foreign countries. In such cases the provisions of the Income tax Act shall apply to the extent they are more beneficial to the Company. Section 91 provides for unilateral relief in respect of taxes paid in foreign countries.

(D) BENEFITS AVAILABLE TO RESIDENT SHAREHOLDERS: i. Dividends exempt under section 10 (34)

Under section 10 (34) of the Act, income earned by way of dividend (Interim or final) from domestic Company referred to in section 115-O of the Act is exempt from Income-tax in the hands of the shareholders. ii. Income of a minor exempt up to certain limit

Under Section 10(32) of the Act, any income of minor children clubbed in the total income of the parent under section 64(1A) of the Act will be exempted from Income-tax to the extent of Rs. 1,500 per minor child, whose income is so included. iii. Computation of capital gains

Capital assets may be categorized into short-term capital assets and long-term capital assets

based on the period of holding. Shares in a Company, listed securities or units of UTI or units of mutual fund specified under section 10 (23D) of the Act or zero coupon bonds will be considered as long-term capital assets if they are held for a period exceeding 12 months. Consequently, capital gains arising on sale of these assets held for more than 12 months are considered as “Long-term capital gains”. Capital gains arising on sales of these assets held for 12 months or less are considered as “Short-term capital gains”.

Section 48 of the Act, which prescribes the mode of computation of capital gains, provides for deduction of cost of acquisition/ improvement and expenses incurred in connection with the transfer of a capital asset, from the sale consideration to arrive at the amount of capital gains. However, in respect of long-term capital gains, it offers a benefit by permitting substitution of cost of acquisition/ improvement with the indexed cost of acquisition/ improvement, which adjusts the cost of acquisition/ improvement by a cost inflation index as prescribed from year to year.

As per provisions of section 112(1)(a) of the Act, long-term gains as computed above that are not exempt under section 10 (38) of the Act would be subject to tax at a rate of 20 percent (plus applicable surcharge, education cess and secondary and higher education cess). However, as per the proviso to section 112(1), if the tax on long-term capital gains resulting on transfer of listed securities or units or zero coupon bond, calculated at the rate of 20 percent with indexation benefit exceed the tax on long-term capital gains computed @ 10 percent without indexation benefit, then such gains are chargeable to tax at a concessional rate of 10 percent (plus applicable surcharge, education cess and secondary and higher education cess).

Gains arising on transfer of short-term capital assets are currently chargeable to tax at the rate of 30 percent (plus applicable surcharge, education cess and secondary and higher education cess) at the discretion of assessee. However, as per provisions of section 111A of the Act, short-term capital gains on sale of equity shares or units of mutual funds on or after 1st October, 2004 where the transaction of sale is chargeable to Securities Transaction Tax (“STT”) shall be subject to tax at a rate of 10 percent (plus applicable surcharge, education cess and secondary and higher education cess).

Exemption of capital gain from Income tax

(i) Under section 10 (38) of the Act, long-term capital gains arising out of sale of equity shares or units of equity oriented fund will be exempt from tax provided that the transaction of sale of such equity shares or units is chargeable to Securities Transaction Tax (“STT”).

(ii) According to the provisions of sections 54EC of the Act and subject to the conditions specified therein, long-term capital gains not exempt under section 10 (38) shall not be chargeable to tax to the extent such capital gains are invested in certain notified bonds within six months from the date of transfer. If only the part of capital gains is so reinvested, the exemption shall be allowed proportionately. In such a case, the cost of such long-term specified assets will not qualify for deduction under section 80C of the Act. However, if the said bonds are transferred or converted into money within a period of three years from the

date of their acquisition the amount of capital gain exempted earlier would become chargeable to income-tax as long-term capital gains in the year in which the bonds are transferred or converted into money. It is also provided under section 54EC that investments made on or after 1st April 2007 in the said bonds should not exceed fifty lakh rupees.

(iii)According to the provisions of section 54F of the Act and subject to the conditions specified therein, in the case of an individual or a Hindu Undivided Family (‘HUF’), gains arising on transfer of a long-term capital asset (not being a residential house) are not chargeable to tax if the entire net consideration received on such transfer is invested within the prescribed period in a residential house. If only a part of such net consideration is invested within the prescribed period in a residential house, the exemption shall be allowed proportionately. For this purpose, net consideration means full value of the consideration received or accruing as a result of the transfer of the capital asset as reduced by any expenditure incurred wholly and exclusively in connection with such transfer. Further, if the residential house in which the investment has been made is transferred within a period of three years from the date of its purchase or construction, the amount of capital gains tax-exempted earlier would become chargeable to income-tax as long-term capital gains in the year in which such residential house is transferred. iv. Rebate under section 88E

From 1st October, 2004 onwards, as per section 88E of the Act, the STT paid by the shareholder in respect of taxable securities transactions entered into in the course of the business would be eligible for deduction from the amount of income-tax on the income chargeable under the head “Profits and gains of business or profession” arising from taxable securities transactions, subject to certain limits specified in the section and also on fulfillment of certain prescribed conditions set out in the said section.

(E) BENEFITS AVAILABLE TO NON-RESIDENT INDIAN SHAREHOLDERS (OTHER THAN FIIS AND FOREIGN VENTURE CAPITAL INVESTORS): i. Dividends exempt under section 10 (34)

Under section 10 (34) of the Act, income earned by way of dividend (Interim or final) on shares from domestic Company referred to in section 115-O of the Act is exempt from income-tax in the hands of the shareholders.

ii. Income of a minor exempt up to certain limit

Under Section 10(32) of the Act, any income of minor children clubbed in the total income of the parent under section 64(1A) of the Act will be exempted from income-tax to the extent of Rs. 1,500 per minor child, whose income is so included.

iii. Computation of capital gains

Capital assets may be categorized into short-term capital assets and long-term capital assets

based on the period of holding. Shares in a Company, listed securities or units of UTI or units of mutual fund specified under section 10 (23D) of the Act or zero coupon bonds will be considered as long-term capital assets if they are held for a period exceeding 12 months. Consequently, capital gains arising on sale of these assets held for more than 12 months are considered as “Long-term capital gains”. Capital gains arising on sales assets held for 12 months or less are considered as “Short-term capital gains”.

Section 48 of the Act contains provisions in relation to computation of capital gains on transfer of shares of an Indian Company by a non-resident where the investment in such shares was made in foreign currency. Computation of capital gains arising on transfer of shares in case of non-residents has to be done in the original foreign currency, which was used to acquire the shares. The capital gain (i.e., sale proceeds less cost of acquisition/ improvement) computed in the original foreign currency is then converted into Indian Rupees at the prevailing rate of exchange. Benefit of indexation of costs is not available in above case.

According to the provisions of section 112 of the Act, long-term capital gains as computed above that are not exempt under section 10(38) of the Act would be subject to income-tax at a rate of 20 percent (plus applicable surcharge, education cess and secondary and higher education cess).

In case investment is made in Indian Rupees, the long-term capital gains that are not exempt under section 10(38) of the Act are to be computed after indexing the cost.

However, as per the proviso to section 112(1)(c), if the tax on long-term gains resulting on transfer of listed securities or units or zero coupon bond, calculated at the rate of 20 percent with indexation benefit exceed the tax on long-term gains computed at the rate of 10 percent without indexation benefit, then such gains are chargeable to income-tax at a concessional rate of 10 percent (plus applicable surcharge, education cess and secondary and higher education cess).

Gains arising on transfer of short-term capital assets are currently chargeable to income-tax at the rate of 30 percent (plus applicable surcharge, education cess and secondary and higher education cess) at the discretion of assessee. However, as per the provisions of section 111A of the Act, short-term capital gains of equity shares on or after 1st October, 2004 where the transaction of sale is chargeable to STT shall be subject to income-tax at a rate of 10 percent (plus applicable surcharge, education cess and secondary and higher education cess).

(i) Capital gains tax - Options available under the Act

Where shares have been subscribed in convertible foreign exchange

Option of taxation under chapter XII-A of the Act:

Non-resident Indians [as defined in section 115C (e) of the Act], being shareholders of an Indian Company, have the option of being governed by the provisions of Chapter XII-A of

the Act, which inter-alia entitles them to the following benefits in respect of income from shares of an Indian Company acquired, purchased or subscribed to in convertible foreign exchange.

(i) According to the provisions of section115D read with section 115E of the Act and subject to the conditions specified therein, long-term capital gains arising on transfer of shares in an Indian Company not exempt under section 10 (38), will be subject to Income-tax at the rate of 10 percent (plus applicable surcharge, education cess and secondary and higher education cess) without indexation benefit.

(ii) According to the provisions of section 115F of the Act and subject to the conditions specified therein, gains arising on transfer of a long-term capital asset being shares in an Indian company shall not be chargeable to tax if the entire net consideration received on such transfer is invested within the prescribed period of six months in any specified asset or specified savings certificates. If part of such net consideration is invested within the prescribed period of six months in any specified asset or specified savings certificate, the exemption will be allowed on a proportionate basis. For this purpose, net consideration means full value of the consideration received or accruing as a result of the transfer of the capital asset as reduced by any expenditure incurred wholly and exclusively in connection with such transfer.

Further, if the specified asset or savings certificates in which the investment has been made is transferred within a period of three years from the date of investment, the amount of capital gains tax exempted earlier would become chargeable to income-tax as long-term capital gains in the year in which such specified asset or savings certificates are transferred.

(iii)As per the provisions of section 115G of the Act, non-resident Indians are not obliged to file a return of income under section 139(1) of the Act, if their source of income is only investment income and / or long-term capital gains defined in section 115C of the Act, provided income-tax has been deducted at source from such income as per the provisions of chapter XVII-B of the Act.

As per the provisions of section 115-I of the Act, a non-resident Indian may elect not to be governed by the provisions of Chapter XII-A for any assessment year by furnishing his return of income for that assessment year under section 139 of the Act, declaring therein that the provisions of Chapter XII-A shall not apply to him for that assessment year and accordingly his total income for that assessment year will be computed in accordance with the other provisions of the Act.

Where the shares have been subscribed in Indian Rupees:

Section 48 of the Act, which prescribes the mode of computation of capital gains, provides for deduction of cost of acquisition/ improvement and expenses, incurred wholly and exclusively in connection with the transfer of a capital asset, from the sale consideration to arrive at the amount of capital gains. However, in respect of long-term capital gains, it offers a benefit by permitting substitution of cost of acquisition/ improvement with the indexed cost

of acquisition/ improvement, which adjusts the cost of acquisition/ improvement by a cost inflation index, as prescribed year to year.

As per the provisions of section 112(1)(c) of the Act, long-term capital gains that are not exempt under section 10(38) of the Act as computed above would be subject to tax at a rate of 20 percent (plus applicable surcharge, education cess and secondary and higher education cess). However, as per the proviso to Section 112(1) of the Act, if the tax payable in respect of long-term capital gains resulting on transfer of listed securities or units, calculated at the rate of 20 percent with indexation benefit exceeds the tax payable on gains computed at the rate of 10 percent without indexation benefit, then such gains are chargeable to income-tax at the rate of 10 percent without indexation benefit (plus applicable surcharge, education cess and secondary and higher education cess).

(ii) Exemption of capital gain from income tax

Under section 10(38) of the Act, long-term capital gains arising out of sale of equity shares or units of equity oriented fund will be exempt from tax provided that the transaction of sale of such equity shares or units is chargeable to STT.

According to the provisions of section 54EC of the Act and subject to the conditions specified therein, capital gains not exempt under section 10(38) and arising on transfer of a long-term capital asset shall not be chargeable to tax to the extent such capital gains are invested in certain notified bonds within six months from the date of transfer. If only part of the capital gain is so reinvested, the exemption shall be allowed proportionately. It is also provided under section 54EC that investments made on or after 1st April 2007 in the said bonds should not exceed fifty lakh rupees.

In such a case, the cost of such long-term specified asset will not qualify for deduction under section 80C of the Act. However, if the said bonds are transferred or converted into money within a period of three years from the date of their acquisition, the amount of capital gains exempted earlier would become chargeable to income-tax as long-term capital gains in the year in which the bonds are transferred or converted into money.

According to the provisions of section 54F of the Act and subject to the conditions specified therein, in the case of an individual, gains arising on transfer of a long-term capital asset (not being a residential house) is invested within the prescribed period in a residential house. If only a part of such net consideration is invested within the prescribed period in a residential house, the exemption shall be allowed proportionately. For this purpose, net consideration means full value of the consideration received or accruing as a result of the transfer of the capital asset as reduced by any expenditure incurred wholly and exclusively in connection with such transfer. Further, if the residential house in which the investment has been made is transferred within a period of three years from the date of its purchase or construction, the amount of capital gains tax exempted earlier would become chargeable to tax as long-term capital gains in the year in which such residential house is transferred. v. Rebate under section 88E

(i) As per Section 90(2) of the Act, the provisions of the Act would prevail over the provisions of the relevant tax treaty to the extent they are more beneficial to the non-resident.

(ii) As per the provisions of section 90, for taxes on income paid in Foreign Countries with which India has entered into Double Taxation Avoidance Agreements (Tax Treaties from projects/Activities undertaken thereat, the Company will be entitled to the deduction from the India Income-tax of a sum calculated on such doubly taxed income to the extent of taxes paid in Foreign Countries. Further, the Company as a tax resident of India would be entitled to the benefits of such Tax Treaties in respect of income derived by it in foreign countries. In such cases the provisions of the Income-tax Act shall apply to the extent they are more beneficial to the Company. Section 91 provides for unilateral relief in respect of taxes paid in foreign countries.

(F) BENEFITS AVAILABLE TO OTHER NON-RESIDENT SHAREHOLDERS (OTHER THAN FIIS AND FOREIGN VENTURE CAPITAL INVESTORS): i. Dividends exempt under section 10 (34)

Computation of capital gains

Capital assets may be categorized into short-term capital assets and long-term capital assets based on the period of holding. Shares in a Company, listed securities or units of UTI or unit of mutual fund specified under section 10 (23D) of the Act or zero coupon bond will be considered as long-term capital assets if they are held for a period exceeding 12 months. Consequently, capital gains arising on sale of these assets held for more than 12 months are

considered as “Long-term capital gains”. Capital gains arising on sales assets held for 12 months or less are considered as “Short-term capital gains”.

Section 48 of the Act contains provisions in relation to computation of capital gains on transfer of shares of an Indian Company by a non-resident. Computation of capital gains arising on transfer of shares in case of non-residents has to be done in the original foreign currency, which was used to acquire the shares. The capital gain (i.e., sale proceeds less cost of acquisition/ improvement) computed in the original foreign currency is then converted into Indian Rupees at the prevailing rate of exchange.

According to the provisions of section 112 of the Act, long-term gain as computed above that are not exempt under section 10(38) of the Act would be subject to tax at a rate of 20 percent (plus applicable surcharge and education cess). In case investment is made in Indian Rupees, the long-term capital gain is to be computed after indexing the cost.

However, as per the proviso to section 112(1)(c), if the tax on long-term gains resulting on transfer of listed securities or units or zero coupon bond, calculated at the rate of 20 percent with indexation benefit exceed the tax on long-term gains computed at the rate of 10 percent without indexation benefit, then such gains are chargeable to tax at a concessional rate of 10 percent (plus applicable surcharge, education cess and secondary and higher education cess).

Gains arising on transfer of short-term capital assets are currently chargeable to tax at the applicable rates1 (plus applicable surcharge, education cess and secondary and higher education cess) at the discretion of assessee. However, as per the provisions of section 111A of the Act, short-term capital gains of equity shares where the transaction of sale is chargeable to STT shall be subject to tax at a rate of 10 percent (plus applicable surcharge, education cess and secondary and higher education cess).

Exemption of capital gain from income tax

(i) Under section 10(38) of the Act, long-term capital gains arising out of sale of equity shares or units of equity oriented fund will be exempt from tax provided that the transaction of sale of such equity shares or units is chargeable to STT.

According to the provisions of section 54EC of the Act and subject to the conditions specified therein, capital gains not exempt under section 10(38) shall not be chargeable to tax to the extent such capital gains are invested in certain notified bonds within six months from the date of transfer. If only part of the capital gain is so reinvested, the exemption shall be allowed proportionately. It is also provided under section 54EC that investments made on or after 1st April 2007 in the said bonds should not exceed fifty lakh rupees. In such a case, the cost of such long-term specified asset will not qualify for deduction under section 80C of the Act.

However, if the assessee transfers or converts the notified bonds into money within a period

1 In case of Firm – 30 % In case of Foreign Company – 40 % 49

of three year from the date of their acquisition, the amount of capital gains exempt earlier would become chargeable to tax as long-term capital gains in the in which the bonds are transferred or converted into money.

(ii) According to the provisions of section 54F of the Act and subject to the conditions specified therein, in the case of an individual or a HUF, gains arising on transfer of a long-term capital term asset (not being a residential house) are not chargeable to tax if the entire net consideration received on such transfer is invested within the prescribed period in a residential house. If only a part of such net consideration is invested the prescribed period in a residential house, the exemption shall be allowed proportionately. For this purpose, net consideration means full value of the consideration received or accrued as a result of the transfer of the capital asset as reduced by any expenditure incurred wholly and exclusively in connection with such transfer. Further, if the residential house in which the investment has been made is transferred within a period of three years from the date of its purchase or construction, the amount of capital gains tax-exempted earlier would become chargeable to income-tax as long-term capital gains in the year in which such residential house is transferred. iii. Rebate under section 88E

(i) As per Section 90(2) of the Act, the provisions of the Act would prevail over the provisions of the relevant tax treaty to the extent they are more beneficial to the non-resident.

(ii) As per the provisions of section 90, for taxes on income paid in Foreign Countries with which India has entered into Double Taxation Avoidance Agreements (Tax Treaties from projects/ activities undertaken thereat, the Company will be entitled to the deduction from the Indian Income-tax of a sum calculated on such doubly taxed income to the extent of taxes paid in Foreign Countries. Further, the Company as a tax resident of India would be entitled to the benefits of such Tax Treaties in respect of income derived by it in foreign countries. In such cases the provisions of the Income tax Act shall apply to the extent they are more beneficial to the Company. Section 91 provides for unilateral relief in respect of taxes paid in foreign countries).

(G) BENEFITS AVAILABLE TO FOREIGN INSTITUTIONAL INVESTORS (‘FIIs’): i. Dividends exempt under section 10 (34)

Under section 10 (38) of the Act, long-term capital gains arising out of sale of equity shares or a unit of equity oriented fund will be exempt from tax provided that the transaction of sale of such equity shares or units is chargeable to STT. However, such income shall be taken into account in computing the book profits under section 115JB.

The income by way of short-term capital gains or long-term capital gains [in case not covered under section 10 (38) of the Act] realized by FIIs on sale of such securities of the Company would be taxed at the following rates as per section 115AD of the Act-

• Short-term capital gains, other than those referred to under section 111A of the Act shall be taxed @ 30% (plus applicable surcharge, education cess and secondary and higher education cess).

• Short-term capital gains, referred to under section 111A of the Act shall be taxed @ 10% (plus applicable surcharge, education cess and secondary and higher education cess).

• Long-term capital gains @10% (plus applicable surcharge, education cess and secondary and higher education cess) (without cost indexation).

It may be noted that the benefits of indexation and foreign currency fluctuation protection as provided by section 48 of the Act are not applicable.

According to provisions of section 54EC of the Act and subject to the condition specified therein, long-term capital gains not exempt under section 10(38) shall not be chargeable to tax to the extent such capital gains are invested in certain notified bond within six months from the date of transfer. If only part of the capital gain if so reinvested, the exemption shall be allowed proportionately. It is also provided under section 54EC that investments made on or after 1st April 2007 in the said bonds should not exceed fifty lakh rupees.

However, if the assessee transfers or converts the notified bonds into money within a period of three years from the date of their acquisition, the amount of capital gains tax- exempt earlier would become chargeable to tax as long-term capital gains in which the bonds are transferred or converted into money. iii. Provisions of the Act vis-à-vis provisions of the tax treaty

(i) As per Section 90(2) of the Act, the provisions of the Act would prevail over the provisions of the relevant tax treaty to the extent they are more beneficial to the non-resident.

(ii) As per the provisions of section 90, for taxes on income paid in Foreign Countries with which India has entered into Double Taxation Avoidance Agreements (Tax Treaties from projects/Activities undertaken thereat, the Company will be entitled to the deduction from the India Income-tax of a sum calculated on such doubly taxed income to the extent of taxes paid in Foreign Countries. Further, the Company as a tax resident of India would be entitled to the benefits of such Tax Treaties in respect of income derived by it in foreign countries. In such cases the provisions of the Income tax Act shall apply to the extent they are more beneficial to the Company. Section 91 provides for unilateral relief in respect of taxes paid in foreign countries.

(H) BENEFITS AVAILABLE TO MUTUAL FUNDS

As per the provisions of section 10(23D) of the Act, any income of Mutual Funds registered under the Securities and Exchange Board of India Act, 1992 or regulations made thereunder, Mutual Funds set up by public sector banks or public financial institutions or authorized by the Reserve Bank of India would be exempt from income tax subject to the conditions as the Central Government may notify. However, the mutual funds shall be liable to pay additional income-tax on distributed income to unit holders under section 115R of the Act.

(I) BENEFITS AVAILABLE TO VENTURE CAPITAL COMPANIES/ FUNDS

As per the provisions of section 10(23FB) of the Act, any income of Venture Capital Companies/ Funds (set up to raise funds for investment in a venture capital undertaking registered and notified in this behalf) registered with the Securities and Exchange Board of India, would be exempt from income tax, subject to the conditions specified therein. However, the exemption is restricted to the Venture Capital Company and Venture Capital Fund set up to raise funds for investment in a Venture Capital Undertaking, which is engaged in the business as specified under section 10(23FB)(c). However, the income distributed by the Venture Capital Companies/ Funds to its investors would be taxable in the hands of the recipients.

(J) BENEFITS AVAILABLE UNDER THE WEALTH-TAX ACT, 1957

Shares of the Company held by the shareholder will not be treated as an asset within the meaning of section 2(ea) of Wealth Tax Act, 1957, hence no wealth tax will be payable on the market value of shares of the Company held by the shareholder of the Company.

(K) Further the tax benefits related to capital gains are subjected to the CBDT circular no. 4/2007 dated 15th June 2007 and on fulfillment of criteria laid down in the circular, the assessee will be able to enjoy the concessional benefits of taxation on capital gains.

Notes:

1. All the above benefits are as per the current tax law as amended by the Finance Act, 2008 and will be available only to the sole/ first named holder in case the shares are held by the joint holders.

2. In respect of non-residents, the tax rates and the consequent taxation mentioned above will be further subject to any benefits available under the relevant Double Taxation Avoidance Agreement (DTAA), if any, between India and the country in which the non-resident has fiscal domicile.

3. In view of the individual nature of tax consequences, each investor is advised to consult his/ her own tax advisor with respect to specific tax consequences of his/her participation in the issue.

4. The above statement of Tax Benefits sets out the provisions of law in a summary manner only and is not a complete analysis or listing of all potential tax consequences of the purchase, ownership and disposal of shares.

5. No assurance is given that the revenue authorities/ courts will concur with the views expressed herein. Our views are based on the existing provisions of law and its interpretation, which are subject to change from time to time. We do not assume responsibility to update the views consequent to such changes. We will not be liable to any other person in respect of this statement.

SECTION IV: ABOUT US

INDUSTRY OVERVIEW

THE INDIAN ECONOMY

The economy has moved decisively to a higher growth phase during the last decade. Till a few years ago, there was still a debate among informed observers about whether the economy had moved above the 5 to 6 per cent average growth seen since the 1980s. There is now no doubt that the economy has moved to a higher growth trajectory, with growth in GDP at market prices exceeding 8 per cent in every year since 2003-04. The projected economic growth of 8.7 per cent for 2007-08 is fully in line with this trend. There was acceleration in domestic investment and saving rates to drive growth and provide the resources for meeting the 9 per cent (average) growth target of the Eleventh Five-Year Plan. (Source: Economic Survey 2007-08) .

Significantly, the industrial and service sectors have been contributing a major part of this growth, suggesting the structural transformation underway in the Indian economy. For example, industrial and services sectors have logged in a 10.63 and 11.18 per cent growth rate in 2006-07 respectively, against 8.02 per and 11.01 cent in 2005-06. Similarly, manufacturing grew by 8.98 per cent and 12 per cent in 2005-06 and 2006-07 and transport, storage and communication recorded a growth of 14.65 and per cent 16.64 per cent, respectively. (Source: www.ibef.org)

Rate of Growth of GDP at factor cost at 1999-2000 prices (per cent)

Another significant feature of the growth process has been the consistently increasing savings and investment rate. While the gross saving rate as a proportion of GDP has increased from 23.5 per cent in 2001-02 to 34.8 per cent in 2006-07, the investment rate-reflected as the gross capital formation as a proportion of GDP-has increased from 22.8 per cent in 2001-02 to 35.9 per cent in 2006-07. (Source: www.ibef.org)

THE INDIAN AUTOMOBILE SECTOR

The Automotive Industry globally is one of the largest industries and is a key driver of economy. Owing to its deep forward and backward linkages with several key segments of the economy, the automotive industry has a strong multiplier effect on the economy. A sound transportation system plays a pivotal role in the country’s rapid economic and industrial development. The well-developed Indian automotive industry ably fulfils this catalytic role by producing a wide variety of vehicles such as passenger cars, light, medium and heavy commercial vehicles, multi- utility vehicles, scooters, motor-cycles, mopeds, three wheelers, etc.

The automotive industry comprising of the automobile and the auto component sectors has made rapid strides since delicensing and opening up of the sector to FDI in 1991. The industry had an investment of about Rs. 500,000 million in 2002-03 which has gone upto Rs. 800,000 million by the year 2007. The automotive industry has already attained a turnover of Rs. 165,000 million (34,000 million USD). The industry provides direct and indirect employment to 13.1 million people. The contribution of the automotive industry to GDP has risen from 2.77% in 1992-93 to 5% in 2006-07. The industry is also making a contribution of 17% to the kitty of indirect taxes of the Government. (Source: Annual Report 2007-08, Ministry of Heavy Industries and Public Enterprises, Government of India)

wheelers, Hero Honda, is located in India. What once was a supplier driven market having no more than a handful of vehicular models two decades ago, now offers more than 150 models and variants by way of customer options. (Source: Annual Report 2007-08, Ministry of Heavy Industries and Public Enterprises, Government of India)

Production

Automobile production in India has grown in leaps and bounds during past few years. As per information available from ‘Society of Indian Automobile Manufacturers’ (SIAM), the number of automobiles manufactured in India has grown from 5.32 million in 2001-02 to 11.07 million in 2006-07 as shown in the following table:.

Category 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 Passenger 500,301 557,410 782,562 960,487 1,046,133 1,238,032 Cars Utility 105,667 114,479 146,325 182,018 196,506 222,111 Vehicles MPVs 63,751 51,44160,673 67,371 66,661 84,707 Total 669,719 723,330 989,560 1,209,876 1,309,300 1,544,850 Passenger Vehicles M&HCVs 96,752 120,502166,123 214,807 219,295 294,266 LCVs 65,756 83,195108,917 138,896 171,788 225,734 Total 162,508 203,697 275,040 353,703 391,083 520,000 Commercial Vehicles Three 212,748 276,719 356,223 374,445 434,423 556,124 Wheelers Scooters 937,506 848,434935,279 987,498 1,021,013 943,974 Motorcycles 2,906,323 3,876,175 4,355,168 5,193,894 6,207,690 7,112,225 Mopeds 427,498 351,612332,294 348,437 379,994 379,987 Electric Two - - - - - 7,982 Wheelers Total Two 4,271,327 5,076,221 5,622,741 6,529,829 7,608,697 8,444,168 Wheelers Grand Total 5,316,302 6,279,967 7,243,564 8,467,853 9,743,503 11,065,142 (Source: Society of Indian Automobile Manufacturers)

In 2007-08 the number of passenger vehicles produced was 1,762,131. 545,176 commercial vehicles, 500,592 three wheelers and 8,026,049 two wheelers were produced in the same year.

Sales Domestic Sales

In tandem with the production of automobiles, domestic sales have been growing impressively during past few years and maintained that tempo in 2006-07 and 2007-08 also.

The cumulative growth of the Passenger Vehicles segment during April - March 2007 was 20.70 percent. Passenger Cars grew by 22.01 percent, Utility Vehicles by 13.21 percent and Multi Purpose Vehicles by 25.20 percent in FY 2006-07. (Source: Society of Indian Automobile Manufacturers)

The Commercial Vehicles segment grew by 33.28 percent. Growth of Medium & Heavy Commercial Vehicles was 32.84 percent and Light Commercial Vehicles recorded a growth of 33.93 percent. (Source: Society of Indian Automobile Manufacturers)

Three Wheelers sales grew by 12.22 percent with sales of Goods Carriers increasing by 13.52 percent and Passenger Carriers by 11.33 percent during April- March 2007 compared to the corresponding period last year. (Source: Society of Indian Automobile Manufacturers)

The Two Wheeler market grew by 11.42 percent during April- March 2007 over the same period last year. Motorcycles grew by 12.79 percent, Scooters grew by 3.48 percent and Mopeds registered a growth of 6.95 percent. (Source: Society of Indian Automobile Manufacturers)

The details of domestic sales of automobiles since 2001-02 are shown in the following table:

Category 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 Passenger Cars 509,088 541,491 696,153 820,179 882,208 1,076,408 Utility Vehicles 104,253 113,620 146,388 176,360 194,502 220,199 MPVs 61,775 52,087 59,555 65,033 66,366 83,091 Total Passenger Vehicles 675,116 707,198 902,096 1,061,572 1,143,076 1,379,698 M&HCVs 89,999 115,711 161,395 198,506 207,472 275,600 LCVs 56,672 74,971 98,719 119,924 143,569 192,282 Total Commercial Vehicles 146,671 190,682 260,114 318,430 351,041 467,882 Three Wheelers 200,276 231,529 284,078 307,862 359,920 403,909 Scooters 908,268 825,648 886,295 922,428 909,051 940,673 Motorcycles 2,887,194 3,647,493 4,170,445 4,964,753 5,810,599 6,553,664 Mopeds 408,263 338,985 307,509 322,584 332,741 355,870 Electric Two Wheelers ----- 7,341 Total Two Wheelers 4,203,725 4,812,126 5,364,249 6,209,765 7,052,391 7,857,548 Grand Total 5,225,788 5,941,535 6,810,537 7,897,629 8,906,428 10,109,037 (Source: Society of Indian Automobile Manufacturers)

In 2007-08 domestic sales of passengers vehicles was 1,547,985 units, commercial vehicles was 486,817 units, three wheelers was 364,703 units and two wheelers was 7,248,589 units.

Export

The Indian automotive industry is now finding increasing recognition worldwide and a beginning has been made in exports of vehicles as well as components. During the year 2003-04, the export

of automobile industry registered a growth rate of 55.98% while it was 31.25%, 28.03% and 25.43% during the year 2004-05, 2005-06 and 2006-07 respectively. Automobile exports crossed the US$ 1 billion mark in 2003-04 and increased to US$ 2.76 billion in 2006-07. The industry exported 15% of its passenger car production in 2006-07, 10% of commercial vehicles production, 26% three wheelers and 7% two wheelers. (Source: Economic Survey 2007-08)

The details of export growth from 2001-02 to 2006-07 are shown in the following table:

Category 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 Passenger Cars 49,273 70,263 125,320 160,670 169,990 192,745 Utility Vehicles 3,077 1,177 3,049 4,505 4,489 4,403 MPVs 815 565 922 1227 1093 1330 Total Passenger Vehicles 53,165 72,005 129,291 166,402 175,572 198,478 M&HCVs 4,824 5,638 8,188 13,474 14,078 18,838 LCVs 7,046 6,617 9,244 16,466 26,522 30,928 Total Commercial Vehicles 11,870 12,255 17,432 29,940 40,600 49,766 Three Wheelers 15,462 43,366 68,144 66,795 76,881 143,896 Scooters 28,332 32,566 53,687 60,699 83,934 35,685 Motorcycles 56,880 123,725 187,287 277,123 386,054 545,887 Mopeds 18,971 23,391 24,078 28,585 43,181 37,566 Electric Two Wheelers ------Total Two Wheelers 104,183 179,682 265,052 366,407 513,169 619,138 Grand Total 184,680 307,308 479,919 629,544 806,222 1,011,278 (Source: Society of Indian Automobile Manufacturers)

In 2007-08 the number of passenger vehicles exported was 218,418; 58,999 commercial vehicles, 141,235 three wheelers and 819,847 two wheelers were also exported in the same year.

FDI in the automobile sector

The Indian automobile success story has paved the way for foreign investments, making India an attractive destination for global players like Japanese, Korean, European, and American OEMs which made a foray in the Indian market and added over 1 million four-wheelers during 2005-06. Major players like Daimler (Mercedes), Suzuki, General Motors, Skoda, Toyota, Honda and Hyundai already have their manufacturing setup in India. Other large players like BMW, Renault and Nissan have recently setup, or are in the process of setting up their production units in India. International carmakers are now shifting focus to India, from China, to establish their manufacturing plants and units.

Competitive advantage

India has made a mark in the global automobile industry; the salient aspects below make for India featuring on every leading automobile player's roadmap:

• World’s second largest manufacturer of two wheelers; • Fifth largest manufacturer of commercial vehicles; • Manufactures the largest number of tractors in the world; • Fourth largest passenger car market in Asia; • World’s largest manufacturer of two wheelers, Hero Honda, is located in India; and • Offers more than 150 models and variants by way of customer options.

(Source: Annual Report 2007-08, Ministry of Heavy Industries and Public Enterprises, Government of India)

THE AUTO COMPONENTS SECTOR IN INDIA

Background

Surge in the automobile industry since the nineties has led to robust growth of the auto component sector in the country. Responding to the emerging scenario, the Indian auto component sector has shown great advances in recent years in terms of growth, spread, absorption of newer technologies and flexibility, despite multiplicity of technology platforms and low volumes. India’s reasonably priced skilled workforce, large population of technology workers coupled with strengths gained by the country in IT and electronics, all build up an environment for a significant leap in component industry. Indian Auto Component Industry, with a turn over of Rs. 6,450 billion in the year 2006-07 and manufacturing all the key components required for vehicle manufacturing, has played a key role in the growth and development of the country’s automotive industry. (Source: Economic Survey 2007-08)

The Indian auto component industry is wide (over 400 firms in the organized sector producing practically all parts and more than 10,000 firms in small unorganized sector, in tierized format) and has been one of the fastest growing segments of the auto industry. During the year 2006-07, the Auto Component Industry continued its high growth path and emerged as one of the fastest growing sectors in the Indian Engineering Industry by clocking 21% growth in output during the year. The industry crossed a total turnover of over US $ 15 billion (Rs. 645,000 million), with exports of US $ 2.9 billion (Rs. 126,430 million) during the year. Investment in the industry also grew by over Rs. 45,000 million during the year as the industry continued to invest in capacity enhancements and new greenfield sites to cope with the increasing demand. (Source: Economic Survey 2007-08)

On the quality and productivity front, auto component industry maintained its leadership with more than 95% companies being certified as per the ISO 9000 system standards and more than 70% of the companies are certified as per the ISO/TS 16949 standards. This industry has also the distinction of having the maximum number of 11 Deming award winning companies. The performance of the auto component sector in terms of turnover, export and employment during the past 4 years is as follows:

Indicators Fiscal 2007 Fiscal 2006 Fiscal 2005 Fiscal 2004 Turnover (Rs. in Mn) 645,000 534,000 385,000 306,400 Employment (Direct) 2,850,000 2,700,000 2,500,000 2,500,000

(Source: Economic Survey 2007-08)

A large number of cars in North America, Europe and in other auto marts of the world now carry Indian brands under their bonnets. Of the US$ 2.21 billion worth of component exports by the Indian auto component industry, around 70 per cent are bought by global majors such as General Motors, Ford Motor and DaimlerChrysler, among others. (Source: www.ibef.org).

India's component industry now has the capability to manufacture the entire range of autocomponents, such as engine parts, drive, transmission parts, suspension and braking parts, electrical parts, and body and chassis parts, with engine parts making up nearly a third of all exports.

• Engine parts (31 per cent) • Drive transmission and steering parts (19 per cent) • Body and chassis (12 per cent) • Suspension and braking parts (12 per cent) • Equipment (10 per cent) • Electrical parts (9 per cent) • Others (7 per cent) (Source: www.ibef.org)

Existing scenario

Steered here by India's sophisticated engineering skills, established production lines, a thriving domestic automobile industry and competitive costs, global auto majors are rapidly ramping up the value of components they source from India. The share of exports in total production has risen from 10 per cent in 1997 to 18 per cent in 2006. The industry is poised to jump from exports of US$ 1.8 billion in 2004-05 to US$ 2.89 billion in 2006-07 and US$ 5.9 billion in 2008-09. According to ACMA, more than a third (36 per cent) of Indian auto component exports

head for Europe, with North America featuring a close second at 26 per cent. (Source: www.ibef.org)

The composition of exports in terms of the proportion of OEM and aftermarket has undergone a sweeping change since the past decade. The ratio of OEM to aftermarket has changed from 35:65 in the 1990s to 75:25 in 2006. (Source: Dun & Bradstreet Report on SMEs in Emerging India- Auto Components)

In 2006, components worth US$ 2 billion were exported by Indian companies, 75 per cent of which were bought directly by car companies. While exports have been booming, there has been a sharp rise in imports of auto components as well, especially in the last three years. From an import of US$ 250 million in FY03, they have gone up to US$ 750 million in FY06. This is a healthy trend, indicative of rising domestic demand. (Source: www.ibef.org)

Over 20 OEMs have set up their International Purchase Offices in India to the components. This number is expected to double by the year 2010. The OEMs in India include firms like General Motors, Ford Motor Company, Cummins International, Bosch, Volkswagen, BMW, MAN (trucks) and JCB (earthmoving equipment) amongst others.(Source: www.ibef.org)

India enjoys a cost advantage with regard to castings and forgings. The manufacturing costs in India are 25 to 30 percent lower than its western counterparts. India's competitive advantage does not come from costs alone, but from its full service supply capability. (Source: www.ibef.org)

Besides, the quality consciousness of the industry matches global standards now. This is corroborated by the fact that nine Indian companies in the automotive sector have received the coveted Deming Prize, which is the largest number outside Japan.

Investments

Since 2000, the auto component industry has recorded an investment level of US$ 0.44 billion and has attracted US$ 530 million in terms of foreign direct investment (FDI). The Investment Commission has set a target of attracting foreign investment worth US$ 5 billion for the next five years to increase India's share in the global auto components market from the present 0.4 per cent to 3-4 per cent. (Source: www.ibef.org)

Global OEMs sourcing parts from India include General Motors, Ford, Fiat, DaimlerChrysler, Eaton Corporation, Renault and Volvo. General Motors has decided to increase sourcing and intends to ship parts worth US$ 1 billion to its global production units by 2010. Ford Motor has also planned to source components worth US$ 500 million from India for its global operations. (Source: www.ibef.org)

Not only global investors, Indian component companies are also pumping in huge sums into expanding operations

Government Initiatives

The Government of India allows automatic approval for foreign equity investment up to 100 per cent for the manufacture of auto components. Manufacturing and imports in this sector is free from licensing and approvals. There is no local content regulation in the auto industry. The engineering export promotion council under the aegis of Ministry of Commerce and Industry, Government of India, over the years has been engaged in promoting exports of engineering goods including auto parts. Among other initiatives that have been affected in 2006-07 are:

• Setting up of the National Automotive Testing and R&D Infrastructure Project (NATRIP) at a total cost of US$ 388.5 million for enabling the industry to usher in global standards of vehicular safety, emission and performance standards.

• Finalization of the Automotive Mission Plan (AMP) 2006-2016 for making India a preferred destination for design and manufacture of automobile and automotive components.

• The reduction in customs duty -- maximum level of 7.5 per cent -- on key metallic raw materials and inputs for the auto-component industry.

• Reduced excise duty on small cars to 12 per cent, a step which would propel India as a global manufacturing hub for small cars and directly enable the auto-component supplier industry to attain volumes.

• The government has notified setting up an automobile testing and homologation centre, International Centre for Automotive Technology (iCAT), at an investment of US$ 15.23 million which would act as an accredited agency to approve homologation standards for automobiles.

Future Outlook

Exciting times lie ahead for the Indian automotive component industry. The Indian auto component industry is likely to almost double to US$ 18.7 billion by 2009 and reach about US$ 40 billion by 2014. Besides the burgeoning demand from global auto majors, there is also the domestic car industry, which is growing at a rate of over 20 per cent, driven by a rising consumer base and affordable loans. (Source: www.ibef.org)

The growth in the auto comp sector has a strong correlation with automobile sector growth. As can be seen below since the auto sector has grown at a fast clip and is expected to continue this growth in the future, the auto comp sector looks to be in fine fettle in the future.

As per the industry report, the potential for the Indian auto component industry is estimated to be US$ 40-45 billion by 2015. Of this, 50 per cent is expected to come from exports. (Source: www.ibef.org)

India is estimated to have the potential to become one of the top five auto component economies by 2025. The industry has been experiencing a high growth rate of 20 per cent over the period 2000-05 and is expected to grow at a rate of 17 per cent over the period 2006-14. Similarly,

while growth rate of exports has been 25 per cent during 2000-05, the growth rate is expected to grow by 34 per cent during 2006-14. (Source: www.ibef.org)

OUR BUSINESS

OVERVIEW

Our Company was incorporated in 1990 under the name of JBM Tools Limted, the SK Arya group (“SKA”) being the promoters. In 1997, our Company, pursuant to an agreement between SKA and TACO, was converted into a Joint Venture between TACO, its affiliate TIL and SKA. In April 2002, TACO and TIL bought over SKA’s stake to take its combined holding to 81.35%. Subsequently, TIL transferred its stake (except for 100 shares) to TACO in March 2004 and TACO became the holding Company.

During the last five Fiscal years, as per our Financial Statements, our net sales have grown from Rs. 1,764.02 million in Fiscal 2004 to Rs. 3,009.87 million in Fiscal 2008 registering a CAGR of 14.29 %. Details of our net sales and restated PAT, as per our Financial Statements, during the last five Fiscal years are shown in the following table:

(Rs. in Mn)

For the year ended March 31 2008 2007 2006 2005 2004 Net Sales 3,009.87 3,131.85 2,767.97 2,498.84 1,764.02 Restated Profit After Tax 44.08 106.38* 40.20 42.42 76.02* * Includes one time pre-tax income of Rs. 101.82 million and Rs. 35.05 million for FY 2007 and FY 2004 respectively on account of gain on prepayment of sales tax deferral loan as per the scheme for Premature Repayment of Sales Tax Deferral Loan .

OUR COMPETITIVE STRENGTHS

We believe that we have the following competitive strengths:

• The TATA Brand Value

Our Company being a part of the USD 29 Billion Tata Group (by revenues in Fiscal 2007, excluding Corus financials), gets tremendous respect as a member of the group. As compared to the unorganized players in the sheet metal industry, our association with the TATA Group invokes confidence and faith on us in terms of delivery and value systems. It gives us a competitive advantage over our competitors.

• Wide Range of products

• Integrated production facility

• Financial Strength

The sheet metal components industry is a highly capital intensive industry. Our Company enjoys strong financial and technical support from our promoters namely TACO and Gestamp. Further, Our Company is one of the few companies in the sheet metal component industry in India which is listed and therefore having access to the capital market.

• Locational proximity to customers

The location of our plants near the automotive hub at Pune helps us to bring down our

logistics cost, hence making us more competitive in pricing. Moreover, Pune region, specifically Chakan is fast becoming the ‘Detroit’ of India because a number of automotive OEMs has set/is setting plants in the region. Having our largest plant here gives us tremendous benefit in terms of logistics.

• Technical support from Gestamp Group

Some of the new technologies to be introduced with the help of Gestamp include hot stampings; tailor welded blanks, hydro/roll forming, steel service centre and blanking activities.

OUR BUSINESS STRATEGY

The key objectives of our Company are derived from this strategic philosophy. These include:

• Improving Customer Satisfaction Scores and Vendor Rating

• Developing product designing, tool designing and manufacturing capabilities to become complete service provider

• Improving net product sales through business development comprising:

- Increasing business with existing customers - Targeting new customers with base similar to that of existing customers

• Improving engineering capability through technical and business support from TACO and Gestamp

• Improving operational efficiency and effecting cost reduction through structured improvement processes and systems

• Improving employee satisfaction scores through developing competencies and retention plans

OUR PRINCIPAL PRODUCTS

We supply a large range of components and assemblies to different sectors of the automobile industry in widely varying specifications. The products supplied by us can be classified into the following categories:

Skin Parts of cars: We manufacture skin parts such as outer bonnet, side and rear door panel and face/side of trucks/buses. The major customers of this category of products are Fiat India Private Limited (for Palio), Tata Motors Limited (for Tatamobile) and Piaggio Vehicles Private Limited (for three wheelers).

Body in White Components: Body in White (BIW) parts are those parts of the car that are hidden from the user’s view. We make various BIW parts such as main internal BIW parts, door and bonnet inner, panel dash etc. The major customers of this category of products are Tata Motors Limited (for Safari, Mobile, Indica and Indigo) and Fiat India Private Limited (for Palio, Linea and Punto)

Under Body Members: Assembly front floors, longitudinal rear and cross member are examples of under body members manufactured by us for our customers. The major customer of this category of products is Tata Motors Limited (for its Indica and Indigo models).

Fuel Tanks: We manufacture the top shell for the fuel tank used by Tata Motor Limited’s Indigo. We also manufacture the shell for the Tata Indica’s fuel tank. The major customer of this category of products is Tata Motors Limited (for Indica and Indigo).

Chassis and Suspension Parts: Trailing arms, suspension tower rear and rear twist beam (for new Indica) are some of the chassis and suspension parts manufactured by us. The major customer of this category of products is Tata Motors Limited (for its Indica and Indigo models).

Wheel Housing: Assembly fender, panel wheel housing and wheel arch are some products made by us. The major customers of this category of products are Mahindra & Mahindra Limited and Tata Motors Limited (for its Safari and Sumo models)

Oil Sumps and Other Products: We make oil sumps for various customers and other products like cover tail lamp, support console etc. The major customers of this category of products are Tata Motors Limited (for its Indica and Indigo models), etc.

Out of the above product categories, sale of BIW parts constitute around 80% of the total revenues.

RAW MATERIALS

The principal raw materials consumed by us are MS Sheets (hot and cold rolled steel sheets), bought-out parts such as tubes, brackets, hinges, reinforcements, sleeves, nuts etc and other products like pipes, angles, etc.

The contribution of various raw materials to our total raw material consumption, as per our Financial Statements during last three Fiscal Years is as follows:

(Rs. in Mn) Product Fiscal 2008 Fiscal 2007 Fiscal 2006 Category Consum % of total Consump % of total Consum % of total ption raw material tion raw material ption raw consumption consumption material consumpt ion BOP 423.65 19.23% 416.56 17.41% 199.25 10.13% Component MS Sheets 1,765.03 80.13% 1,975.32 82.57% 1,746.63 88.76% Others like 14.07 0.64% 0.29 0.02% 21.96 1.11% Pipes, Angles, etc. Total 2,202.75 100.00% 2,392.17 100.00% 1,967.84 100.00%

PRODUCTION PROCESS

The manufacturing process of sheet metal components involves a series of operations on sheet metal with the help of press tools on mechanical and hydraulic presses to attain the required shape and form. Subsequently, two or more components are welded together to form sub- assemblies and assemblies.

First, the steel sheets are sheared into optimum sized strips for the preparation of blanks, depending on the specifications of various components. The prepared strips are loaded onto the mechanical/hydraulic presses of the required tonnage in the press shop and subjected to various operations like blanking, drawing, trimming, piercing, forming, bending, notching etc., with the

help of dies (press tool) designed for the purpose.

The sheet metal components, after pressing, are inspected with the help of panel checkers. Once checked, the sheet metal components are coated with anti rust oil and stored for welding, if required. The components, which do not require welding, are directly sent to the finished stores for despatch. The components that require assembly are sent to the weld shop.

The welding process is generally done manually or by robots using MIG/projection welding/seam welding. After welding, the sub assemblies are inspected on inspection gauges, coated with anti rust oil and sent to the finished stores ready for despatch.

Some of the assemblies are also powder coated.

PRODUCTION FACILITIES

Currently we have three production facilities at Bhosari (Maharashtra), Chakan (Maharashtra) and Halol (Gujarat). Further, we have recently setup a plant in Pantnagar (Uttarakhand) for production of sheet metal assemblies and sub-assemblies for Tata Motor Limited’s ACE platform of vehicles. This new plant has recently commenced commercial production in May 2008. The details of the aforesaid production facilities are given below:

Bhosari Facility

Infrastructure facility

Our oldest facility, the Bhosari plant was setup in December 1995 and is spread across 9,000 square meters.

Machinery

The key machinery in our Bhosari facility include one 1,000 Tonnes double action press, two 600 Tonnes single action Press, two 400 Tonnes single action press, one 250 Tonnes single action press fuel tank welding, seam welding machine for fuel tanks and spot welding, leak testing facility, powder coating facility, CAD centre, tool room etc.

Utilities

The Unit at Bhosari has been sanctioned electricity by the Maharashtra State Electricity Distribution Company Limited, Pune. Water is supplied by the Maharashtra Industrial Development Corporation, Bhosari – Pune.

Products

The products manufactured at Bhosari plant are mainly BIW parts, fuel tanks, assemblies, sub- assemblies, chassis and suspension parts and oil sumps.

Capacity & Capacity utilization

The installed capacities and capacity utilizations of the Bhosari plant during last three Fiscal Years are as follows:

Fiscal Year Installed capacity (in MT) Average Capacity Utilization (%) 2006 8,000 132% 2007 8,000 142% 2008 8,000 154%

Chakan Facility

Infrastructure facility

Our largest facility, the Chakan plant is spread over nearly 30 acres of land. Commercial production at this plant started in January 1998.

Machinery

The key machinery of the Chakan facility include one 1,500 Tonnes double action press, one 1,250 tonnes single action press, one 1,000 tonnes hydraulic press, four 800 tonnes single action presses, five 600 tonnes single action presses, two 630 tonnes single action presses, one 500 tonnes single action press, three 400 tonnes single action presses, one 315 tonnes single action press, spot welding facility, CAD facility, CNC pipe bending machine for exhaust systems etc.

Utilities

The Unit at Chakan has been sanctioned electricity by the Maharashtra State Electricity Distribution Company Limited, Pune. It uses water from tube well.

Products

The products manufactured at Chakan plant are mainly skin parts, BIW parts, under body members, wheel housing, assemblies, sub- assemblies and chassis and suspension parts.

Capacity & Capacity utilization

The installed capacities and capacity utilizations of the Chakan plant during last three Fiscal Years are as follows:

Fiscal Year Installed capacity (in MT) Average Capacity Utilization (%) 2006 29,200 142% 2007 41,620 98% 2008 52,820 78%

Halol Facility

Infrastructure facility

The Halol plant near Vadodara was started in February 1997 and is spread across 9.5 acres of land. General Motors India Private Limited and Setco Automotive Limited are serviced from this plant.

Machinery

The key machinery in the Halol plant include one 1,000 Tonnes single action press, two 600 Tonnes single action presses, one 400 Tonnes single action press, one 250 Tonnes single action press and two 120 Tonnes single action presses.

Utilities

The Halol unit has been sanctioned electricity by the Madhya Gujarat Veej Company Limited (MGVCL). It uses water from tube well.

Products

The products manufactured at the Halol plant are mainly BIW parts, assemblies, sub- assemblies, skin parts and clutch covers.

Capacity & Capacity utilization

The installed capacities and capacity utilizations of the Halol plant during last three Fiscal Years are as follows:

Fiscal Year Installed capacity (in MT) Average Capacity Utilization (%) 2006 10,000 65% 2007 11,900 58% 2008 11,900 27%

Pantnagar Facility

Infrastructure facility

We have been selected by Tata Motors Limited as one of the vendors for their popular ACE platform. To cater to this, we have recently set up a 17,000 MT pressing capacity plant, having a land area of nearly 20,000 square metres at Pantnagar in Uttarakhand state for the manufacture of components for Tata Motors Limited’s ACE project.

Machinery

The key machinery in the Pantnagar facility include two 800 Tonnes single action presses, two 500 Tonnes single action presses, welding equipment etc.

Utilities

The Unit at Pantnagar has been sanctioned electricity by the Uttaranchal Power Corporation Limited, SIDCUL – Rudrapur, Udham Singh Nagar. It uses water from tube well.

Products

The products manufactured at the Pantnagar facility are Sheet Metal Assemblies and Sub- assemblies for Tata Motors Limited’s ACE platform

Capacity

The plant has a production capacity of 17,000 MT. The plant has recently commenced its commercial production.

PROJECT MANAGEMENT

We have a Project Department which is dedicated exclusively to commissioning of new projects.

The activities of the department include:

• studying project viability, • estimation of project cost, • procuring the necessary approvals for the projects, • Placing Orders with suitable suppliers, and • Commissioning the project.

The Department is headed by Mr. Sundarraman Iyer, General Manager – Projects. He is assisted by a team of four persons with relevant experience and exposure in handling the activities of the project department.

QUALITY CONTROL SYSTEM

All the plants of the Company are certified under TS 16949. The Bhosari and Chakan units of the Company have obtained ISO 14001 Certification. The Company has been implementing the Tata Business Excellence Model (modeled on the Malcolm Baldrige National Quality Award) to attain excellence in operations.

The operating processes are designed as per TS 16949 criteria, to ensure that quality is inbuilt into them.

CUSTOMERS

Our main customer is Tata Motors Limited which accounted for approximately 62 % of our net sales in Fiscal 2008.

In India, our principal customers include Tata Motors Limited, Piaggio Vehicles Private Limited, General Motors India Private Limited, Fiat India Private Limited, Mahindra & Mahindra Limited, John Deere Equipment Private Limited, Setco Automotive Limited etc.

Further, we also export our products to Ford Motor Company Limited (UK) and R & O East (USA).

During last three Fiscal Years, contributions of domestic sales and exports in our net sales, as per our Financial Statements, are as follows:

(Rs. in Mn) Particulars Fiscal 2008 Fiscal 2007 Fiscal 2006 Net Sales % of net Net Sales % of net Net Sales % of net sales sales sales Domestic Sales 2,956.95 98.24% 3,076.20 98.22% 2,742.11 99.07% Exports 52.92 1.76%55.65 1.78% 25.86 0.93% Total 3,009.87 100.00% 3,131.85 100.00% 2,767.97 100.00%

The contributions of our top 10 customers in our net sales during last three Fiscal Years, as per our Financial Statements are as follows: (Rs. in Mn) Fiscal 2008 Fiscal 2007 Fiscal 2006 Particulars % of net % of net % of net Net Sales Net Sales Net Sales sales sales sales Top customer 1,869.40 62.11% 2,099.77 67.05% 1,629.25 58.86% Top two customers 2,036.92 67.67% 2,259.28 72.14% 2,056.33 74.29% Top three customers 2,155.71 71.62% 2,388.07 76.25% 2,267.93 81.93% Top four customers 2,268.87 75.38% 2,474.82 79.02% 2,439.84 88.15% Top five customers 2,323.54 77.20% 2,517.01 80.37% 2,560.50 92.50% Top six customers 2,375.63 78.93% 2,547.62 81.35% 2,627.68 94.93% Top seven customers 2,406.91 79.97% 2,574.71 82.21% 2,670.28 96.47% Top eight customers 2,427.27 80.64% 2,595.65 82.88% 2,689.59 97.17% Top nine customers 2,441.70 81.12% 2,608.38 83.29% 2,705.37 97.74% Top ten customers 2,442.98 81.17% 2,612.48 83.42% 2,709.07 97.87%

SUPPLIERS

We procure the raw materials and bought-out parts required from the domestic market as well as from international market.

Our main domestic suppliers are Tata Steel Limited, Essar Steel Limited, Bhushan Steel Limited and ISPAT Limited. Our principal imports are from Samsung C and T Corporation (Korea) and Winamac Coil Spring Inc. (USA).

The share of domestic procurement and imports in our total raw material and bought-out part consumption during last three Fiscal Years, as per our Financial Statements are as follows:

(Rs. in Mn) Particulars Fiscal 2008 Fiscal 2007 Fiscal 2006 Raw % of total Raw % of total Raw % of material and consumpt material and consumpt material total bought out ion bought out ion and bought consum part part out part ption consumption consumption consumptio n Domestic 2,111.76 95.87% 2,303.66 96.30% 1,893.94 96.25% Procurement Imports 90.99 4.13% 88.51 3.70% 73.90 3.75% Total 2,202.75 100.00% 2,392.17 100.00% 1,967.84 100.00%

The contributions of our top 10 suppliers in our total raw material and bought-out part purchases during last three Fiscal Years, as per our Financial Statements are as follows:

Fiscal 2008 Fiscal 2007 Fiscal 2006 Purchases % of total Purchases % of total Purchases % of total Particulars (Rs. in purchases (Rs. in purchases (Rs. in purchases Mn) Mn) Mn) Top supplier 1,000.14 41.19 1,006.65 38.04 841.92 38.50 Top two suppliers 1,520.31 62.61 1,277.18 48.26 1,155.96 52.86 Top three 1,657.69 68.27 1,441.47 54.47 1,333.09 60.96 suppliers Top four 1,786.49 73.57 1,587.59 59.99 1,509.94 69.05 suppliers Top five suppliers 1,854.71 76.38 1,712.63 64.72 1,625.32 74.32 Top six suppliers 1,921.87 79.15 1,834.08 69.31 1,713.16 78.34 Top seven 1,973.97 81.29 1,948.82 73.64 1,783.56 81.56 suppliers Top eight 2,023.85 83.34 2,022.46 76.43 1,819.76 83.21 suppliers Top nine 2,065.69 85.07 2,086.22 78.83 1,851.24 84.65 suppliers Top ten suppliers 2,103.03 86.61 2,148.49 81.19 1,878.78 85.91

HUMAN RESOURCE POLICY

The Head of Human Resource defines competence level in consultation with respective HOD’s requirement of the personnel performing work affecting product quality and ensures that competent personnel are appointed. Competence is defined on the basis of appropriate education, training, skill and experience.

The Company has defined processes to

• Determine the necessary competence for personnel performing work affecting product quality • Plan and provide training or take other actions to satisfy these needs • Evaluate the effectiveness of the actions taken • Ensure that its personnel are aware of the relevance and importance of their activities and how they contribute to the achievement of the quality objectives • Maintain appropriate records of education, training, skill and experience

Training needs are identified & training programmes are planned and conducted including on- the-job training to achieve competence of all personnel performing activities affecting product quality. It is ensured that the personnel performing specific assigned tasks like conducting audits, conducting special process operations, inspection & testing are qualified, as required, with particular attention to the satisfaction of customer requirements. On-the-job training is provided for personnel in case of any new or modified job affecting product quality, including contract or agency personnel. Personnel whose work can affect product quality are informed about the consequences to the customer of nonconformity to quality requirements. It is also ensured that the personnel are aware of the relevance & importance of their activities and their role in achieving the quality objectives / quality policy commitments.

Certain schemes / processes like award / prize distribution, recognition of achievements, promotion etc. are practiced to motivate employees to achieve objectives and to improve performance continually and / or to initiate innovative ideas towards improvement. Innovative ideas are incorporated in company practices by imparting experience / discussion after any visit to other companies / seminars/ exhibition. The overall focus is promotion of quality & technological awareness throughout the whole organization.

MANPOWER

As on May 31, 2008 we have 641 employees. Location-wise and function-wise break-up of our employees are as follows:

Function / Department Employee strength Production & maintenance 115 Materials procurement & marketing 17 Operations, stores & Dispatch 50 Quality Assurance & Business Excellence 25

Function / Department Employee strength Finance & Systems 25 HR & Administration 20 Workers 389 Total 641

Location Employee Strength Bhosari 149 Chakan 343 Halol 63 Pantnagar 16 Corporate Office 70 Total 641

We also hire temporary workers for semi-skilled jobs to meet peak load requirements.

Some of our employees are represented by Labour Unions namely Engineering Kamgar Sangh at Chakan and ASAL Kamgar Sanghatana at Bhosari. The Company has entered into Settlement Agreements with the respective Labour Unions. The details of the said Settlement Agreements are:

(a) Memorandum of Settlement has been signed between the Company and the workmen of Chakan unit, represented by Engineering Kamgar Sangh affiliated to Bhartiya Majdoor Sangh, under section 2(p) read with section 18(1) of the Industrial Disputes Act, 1947 read with rule 62 of Industrial Disputes (Bombay) Rules, 1957. Under this, Tenure of Settlement shall be in force for a period of 3 years and 3 months effective from April 1, 2005 to June 30, 2008 and shall continue to be binding on the parties thereafter until it is terminated by the parties in accordance with the provisions of section 19(2) of Industrial Dispute Act, 1947.

(b) Memorandum of Settlement has been signed between the Company and the workmen of Bhosari unit, represented by ASAL Kamgar Sanghatana, under section 2(p) read with section 18(1) of the Industrial Dispute Act, 1947 read with rule 62 of Industrial Disputes (Bombay) Rules, 1957. Under this, Tenure of Settlement shall be in force for a period of 3 years and 6 months effective from April 1, 2005 to September 30, 2008 and shall continue to be binding on the parties thereafter until it is terminated by the parties in accordance with the provisions of section 19(2) of Industrial Dispute Act, 1947.

COMPETITORS

Our competitors can be segregated into the following four categories:

• Tier I companies such as Jay Bharat Maruti Limited and Rasandik Engineering Limited

• Multinational Tier I companies such as Caparo Engineering India Private Limited

• Other companies like Ganage Pressings Private Limited, Autoline Industries Limited and Anusuya Auto Press Parts Private Limited located in Pune region

• Tier I companies dedicated to a specific company, such as Mahindra Ugine Steel Company Limited for Mahindra & Mahindra Limited

FUTURE GROWTH PLANS

In order to attain a sustainable growth, we have decided to implement the following projects:

• New unit at Pantnagar, Uttarakhand

9 We have received the order for providing sheet metal assemblies for Tata Motors Limted’s ACE model of vehicles

9 For this, we have set up a plant at Pantnagar in Uttarakhand having a land area of nearly 20,000 square metres and production has recently commenced

9 With many new OEMs coming up in Pantnagar, business potential for us is significant

• Expansion due to ‘New Indica’ project

9 Tata Motors is in the process of creating an all new platform for the Indica model so that they can launch more variants on the same platform

9 We are one of the vendors selected for this prestigious project

9 The capacity expansion planned for new Indica program has been partially completed in February 2008. Some of the expansion activities have been shifted to Bhosari Unit. The remaining activities of the project are in progress and are expected to be completed during the first half of the current financial year.

• New unit at Chennai

9 We plan to manufacture brake pedalboxes and clutch pedalboxes in this unit

9 We intend to supply the same to various existing and upcoming automobile units in and around Chennai including that of Renault Nissan

• Fiat order for BIW Parts

9 We have got an order from Fiat for about 53 assemblies for BIW parts for its Linea and Punto programs.

9 Investment will be required mainly in welding shop and material handling facilities and carried out at existing plants.

The Net Proceeds along with term loans and internal accruals will be used to finance the abovementioned projects. For further details in this regard, please refer to “Objects of the Issue” beginning on page 27 of the Draft Letter of Offer.

PROPERTY

Details of our properties are as follows:

Sl. Description of Counter Date and Type Maturity of Consideration No. property Party of instrument Agreement executed 1. Plot No.71, State November 27, Execution of Rs. 2.48 Mn Sector 11, Infrastructure 2007 Lease Deed Integrated & Industrial Possession pending Industrial Estate, Development Certificate / Site Pantnagar, Corporation of Plan and Land Rudrapur, Uttaranchal Allotment Udham Singh Limited Letter dated Nagar August 25, admeasuring 2006 19572.27 sq.mtrs 2. Plot No. G- Space Age July 15, 1995 95 years Rs. 10.50 Mn 71/72, Pimpri Industrial Deed of Lease from and Ground Industrial Area, Projects Ltd Assignment May 1, 1979 Rent of Re. 1 to MIDC Bhosari, pursuant to a MIDC within the limits Scheme of of Pimpri Arrangement Chinchwad sanctioned by Municipal Bombay High Corporation Court. admeasuring 8,830 sq.mtrs 3. Revenue 1. Jayeshbhai October 7, 1994 Owned Rs. 0.60 Mn S.No.173 Village Ashokbhai Deed of Khakharia, Patel Conveyance Taluka Savli, 2.Rasikaben Dist.Baroda w/o admeasuring 9 Kunalchand Acres 34 ra Patel Gunthas for herself and as Guardian of her children

Sl. Description of Counter Date and Type Maturity of Consideration No. property Party of instrument Agreement executed Akshay Kumar K. Patel and Ankur Kumar K. Patel 3.Anuradhaben K Patel 4. Chakan Land a. Land at Gate No. 1.Vishnu Bapu October 14, Owned Rs. 0.33 Mn 427 Village Medankar 1994 Medankarwadi, and others Conveyance Taluka Khed, Deed Chakan, Pune, 2.Pandit admeasuring Maruti Hectares 1-86 Medankar Ares as confirming party

b. Land at Gate No. Namdev Bhiku August 19, 1994 Owned Rs. 0.02 Mn 429 Village Gavate Medankarwadi, Taluka Khed, Chakan, Pune, admeasuring Hectares 0 - 03 Ares

c. Land at Gate No. 1. Laxman October 14, Owned Rs. 0.62 Mn 427 Village Maruti 1994 Medankarwadi, Medankar Conveyance Taluka Khed, Deed Chakan, Pune, admeasuring Hectares 3-53 Ares

d. Land at Gate No. 1. Pandit October 14, Owned Rs. 1.15 Mn 427 Village Maruti 1994 Medankarwadi, Medankar& Conveyance Taluka Khed, others Deed Chakan, Pune,

Sl. Description of Counter Date and Type Maturity of Consideration No. property Party of instrument Agreement executed admeasuring Hectares 6-53 Ares e. Land at Gate No. 1. Madhukar August 19, 1994 Owned Rs. 0.07 Mn 428, Village Bhaguji Agreement for Medankarwadi, Gavate Sale Taluka Khed, 2. Vasant Chakan, Pune, Bhaguji admeasuring Gavate Hectares 0-11 3. Balasaheb Ares Bhaguji Gavate

INSURANCE

Our Company has insurance coverage, which it considers adequate to cover all normal risks associated with the operation of the business. Our Company believes that its current level of insurance coverage is in line with industry norms in India.

The Company has taken a Business Guard Commercial Insurance Policy (Policy No. 0600009601) from TATA AIG Insurance from January 1, 2008 to December 31, 2008 details of which are given hereunder:

Sl. Coverage Section Particulars of Sum Insured/ Premium No. Insured Interest Limit of Indemnity (Rs.) (Rs.) 1 Fire Building and/or Building 309,300,463 102,761 Contents Contents 2,294,117,039 939,590 2 Burglary Contents 596,755,710 84,551 3 Money in Safe Money in Safe 550,000 550 Money in Transit 200,000 1,500 4 Electronic Equipment Electronic 44,729,060 24,431 Equipment like computers, mobiles, laptops 5 Business Interruption Gross Profit and Net 500,000,000 271,900 Profit

REGULATIONS AND POLICIES

The following description is a summary of the relevant regulations and policies as prescribed by the central / state governments that are, inter alia, applicable to our company in India. The information detailed in this chapter has been obtained from publications available in the public domain. The regulations set out below are not exhaustive, and are only intended to provide general information to the investors and are neither designed nor intended to be a substitute for professional legal advice.

Introduction

The following is an overview of the important laws and regulations which are relevant to our business.

Labour Related Legislation

Contract Labour (Regulation and Abolition) Act, 1970

The Company uses the services of contractors who in turn employ contract labour whose number exceeds twenty in respect of some of the sites. Accordingly, the Company is regulated by the provisions of the Contract Labour (Regulation and Abolition) Act, 1970 (the “CLRA”) which requires the Company to be registered as a principal employer and prescribes certain obligations with respect to welfare and health of contract labourers.

The CLRA vests responsibility in the principal employer of an establishment, to which the CLRA applies, to make an application to the concerned officer for registration of the concerned establishment. In the absence of such registration, contract labour cannot be employed in the concerned establishment. Likewise, every contractor, to whom the CLRA applies, is required to obtain a license and may not undertake or execute any work through contract labour except under and in accordance with the license issued. To ensure the welfare and health of the contract labour, the CLRA imposes certain obligations on the contractor in relation to establishment of canteens, rest rooms, drinking water, washing facilities, first aid, other facilities and payment of wages. However, in the event the contractor fails to provide these amenities, the principal employer is under an obligation to provide these facilities within a prescribed time period. Penalties, including both fines and imprisonment, may be levied for contravention of the provisions of the CLRA.

Employees Provident Funds and Miscellaneous Provisions Act, 1952

The Employees Provident Funds and Miscellaneous Provisions Act, 1952 (the “PF Act”) is a labour legislation which ensures compulsory provident fund, family pension fund and deposit linked insurance in factories and other establishments for the benefits of the employees. The rate of contribution has been fixed at 12%. Presently an employee at the time of joining the employment and getting wages up to Rs.6,500 is required to become a member of the

Employees Provident Fund Organization (the “EPFO”), established in accordance with the provisions of the PF Act. An employee is eligible for membership of the fund from the very first date of joining such an establishment.

The PF Act inter alia provides for:

• grant of exemption from the operation of the schemes framed under the PF Act to an establishment, to a class of employees and to an individual employee, on certain conditions; • appointment of an inspector to secure compliance under the PF Act and the schemes framed there under; and • mode of recovery of monies due from employers.

The funds established under the PF Act vest in and are administered by the Central Board of Trustees constituted under the PF Act and functions within the overall regulatory control of the Central Government.

Factories Act, 1948

The Factories Act, 1948 (the “Factories Act”) is the principal legislation governing the health, safety, welfare of workers and environmental sanitation in factories. However, it was not until 1987 that the elements of occupational health and safety, and prevention and protection of workers employed in hazardous processes, were truly incorporated in the Factories Act. The Factories Act is enforced by the State Governments through their factory inspectorates. The Factories Act also empowers the State Governments to frame rules, so that the local conditions prevailing in the State are appropriately reflected in the enforcement.

Payment of Bonus Act, 1965

The Payment of Bonus Act, 1965 (the “Bonus Act”) provides for payment of bonus irrespective of profit and makes payment of minimum bonus compulsory to those employees who draw a salary or wage up to Rs. 10,000 per month and have worked for a minimum period of 30 days in a year. The Bonus Act has created a right in every employee to receive a bonus and it has become an implied term in a contract of employment. Bonus is calculated on the basis of the salary or wage earned by the employee during the accounting year. The minimum bonus to be paid to each employee is either 8.33% of the salary or wage or Rs.100, whichever is higher, and must be paid irrespective of the existence of any allocable surplus or profits. If the allocable surplus or profit exceeds minimum bonus payable, then the employer must pay bonus proportionate to the salary or wage earned during that period, subject to a maximum of 20% of such salary or wage. Contravention of the Bonus Act by a company is punishable with imprisonment up to six months or a fine up to Re. 1,000 or both against those individuals in charge at the time of contravention of the Bonus Act.

Industrial Disputes Act, 1947

The Industrial Disputes Act, 1947 (the “ID Act”) provides the machinery and procedure for

the investigation and settlement of industrial disputes and certain safeguards to the workers. The ID Act aims to improve the service conditions of industrial labour. When a dispute exists or is apprehended, the appropriate government is empowered to refer the dispute to an authority mentioned under the ID Act in order to prevent the occurrence or continuance of the dispute. Reference may be made to a labour court, tribunal or arbitrator, as the case may be, to prevent a strike or lock -out while a proceeding is pending. Wide powers have been given to the labour courts and tribunals under the ID Act while adjudicating a dispute to grant appropriate relief such as modification of contract of employment or to reinstate workmen with ancillary relief.

Payment of Gratuity Act, 1972

Under the Payment of Gratuity Act, 1972 (the “Gratuity Act”), an employee who has been in continuous service for a period of five years will be eligible for gratuity upon his resignation, retirement, superannuation, death or disablement. An employee in a factory is deemed to be in ‘continuous service’ for a period of at least 240 days in a period of 12 months or 120 days in a period of six months immediately preceding the date of reckoning, whether or not such service has been interrupted during such period by sickness, accident, leave, absence without leave, lay-off, strike, lock-out or cessation of work not due to the fault of the employee. The maximum amount of gratuity payable under the Gratuity Act exceeds Rs.0.35 million.

Workmen’s Compensation Act, 1923

Under the Workmen’s Compensation Act, 1923, (the “WC Act”) if personal injury is caused to a workman by accident during employment, his employer is liable to pay him compensation. However, no compensation is required to be paid (i) if the injury does not disable the workman for more than three days, (ii) where the workman, at the time of injury, was under the influence of drugs or alcohol or (iii) where the workman willfully disobeyed safety rules.

Industry Related Legislation

Pollution Laws

The major statutes in India which seek to regulate and protect the environment against pollution related activities in India include the Water (Prevention and Control of Pollution) Act 1974, the Air (Prevention and Control of Pollution) Act, 1981 and the Environment Protection Act, 1986 (the “Environment Protection Act”). The basic purpose of these statutes is to control, abate and prevent pollution. In order to achieve these objectives, Pollution Control Boards (the “PCBs”), which are vested with diverse powers to deal with water and air pollution, have been set up in each state. The PCBs are responsible for setting the standards for maintenance of clean air and water, directing the installation of pollution control devices in industries and undertaking inspection to ensure that industries are functioning in compliance with the standards prescribed. These authorities also have the power of search, seizure and investigation if the authorities are aware of or suspect pollution that is not in accordance with such regulations. All industries and factories are required to obtain consent

orders from the PCBs, which are indicative of the fact that the factory or industry in question is functioning in compliance with the pollution control norms. These consent orders are required to be renewed annually.

The issue of management, storage and disposal of hazardous waste is regulated by the Hazardous Waste Management Rules, 1989 made under the Environment Protection Act. Under these rules, the PCBs are empowered to grant authorization for collection, treatment, storage and disposal of hazardous waste, either to the occupier or the operator of the facility.

Water (Prevention and Control of Pollution) Act, 1981

The Water (Prevention and Control of Pollution) Act, 1981 (the “Water Act”) prohibits the use of any stream or well for the disposal of polluting matter, in violation of standards set down by the state PCB. The Water Act also provides that the consent of the state PCB must be obtained prior to opening of any new outlets or discharges, which is likely to discharge sewage or effluent.

In addition, the Water Cess Act, 1977 requires a person carrying on any industry which involves the use of water to pay a cess in this regard. The person in charge is to affix meters of certain prescribed standards in order to measure and record the quantity of water consumed by such industry. Furthermore, a monthly return showing the amount of water consumed in the previous month must also be submitted.

Air (Prevention and Control of Pollution) Act, 1981

Air (Prevention and Control of Pollution) Act, 1981 (the “Air Act”) under which any individual, industry or institution responsible for emitting smoke or gases by way of use as fuel or chemical reactions must apply in a prescribed form and obtain consent from the state pollution control board prior to commencing any activity. The state PCB is required to grant, or refuse, consent within four months of receipt of the application. The consent may contain conditions relating to specifications of pollution control equipment to be installed. Within a period of four months after the receipt of the application for consent, the state PCB shall, by an order in writing, and for reasons to be recorded in the order, grant the consent applied for subject to such conditions and for such period as may be specified in the order, or refuse consent.

Foreign Trade Policy

Under the Foreign Trade (Development and Regulation) Act, 1992, the Indian Government is empowered to periodically formulate the Export Import Policy (the “EXIM Policy”) and amend it thereafter whenever it deems fit. All exports and imports must be in compliance with the EXIM Policy. The iron and steel industry has been extended various schemes for the promotion of exports of finished goods and imports of inputs. The major schemes available are the Duty Exemption and Remission Scheme, the Export Promotion of Capital Goods (“EPCG”) Scheme and the Target Plus scheme.

The Duty Exemption Scheme enables duty free imports of inputs required for the production of exports by obtaining an advance license.

The Duty Remission Scheme enables post export replenishment/remission of duty on inputs used in the export product. This scheme consists of a Duty Free Replenishment Certificate (“DFRC”), the Duty Drawback Scheme (“DBK”) and the Duty Entitlement Pass Book (the “DEPB”).

While a DFRC enables duty free replenishment of inputs used for the manufacture of exports, under the DEPB Scheme, exporters on the basis of notified entitled rates are granted duty credit, which would entitle them to import goods, except capital goods, without duty. The current DEPB rates for saleable products manufactured by the Company range from 2% to 5%.

The EPCG Scheme permits the import of capital goods at a concession rate of duty of 5% subject to additional export obligation, which is linked to the amount of duty saved at the time of import of such capital goods as per the provisions of the EXIM Policy.

Excise Regulations

The Central Excise Act, 1944 seeks to impose an excise duty on excisable goods which are produced or manufactured in India. The rate at which such a duty is imposed is contained in the Central Excise Tariff Act, 1985. However, the Indian Government has the power to exempt certain specified goods from excise duty by notification. Steel products are classified under Chapter 72 of the Central Excise Tariff Act and presently attract an ad-valorem excise duty at the rate of 14% and also an education cess of 3% over the duty element.

Customs Regulations

All imports into India are subject to duties under the Customs Act, 1962 at the rates specified under the Customs Tariff Act, 1975. However, the Indian Government has the power to exempt certain specified goods from customs duty by notification. The customs duty on iron and steel items falling under Chapter 72 of the Custom Tariff Act, 1975 has been reduced sharply during the last five years. The current custom duty on non-alloy steel is 10%. The peak rate of custom duty on iron and steel items falling under Chapter 72 items was brought down from 40% to 20% on January 1, 2005. The current basic custom duties on imports of raw materials range up to 10%.

Other Regulations

In addition to the laws, rules and regulations outlined in the aforesaid sections, various rules and regulations of jurisdictions’ other than India, where the Company has its operations are also applicable to the Company.

Apart from the above, other laws and regulations that may be applicable to the company include the following:

• Explosives Act, 1884

• Employees’ State Insurance Act, 1948 • Payment of Wages Act, 1936 • Apprentice Act, 1961 • Bombay Labour Welfare Fund Act 1953 • Employers Liability Act,1938 • Equal Remuneration Act,1976 • Industrial Employment (Standing Orders) Act 1946 • Labour Laws (Exemption from Furnishing Returns and Maintaining Registers by certain Establishments) Act • Maharashtra Employment Guarantee Act, 1977 • Maharashtra Private Security Guard Regulation of Employment & Welfare Act 1981 • Maharashtra Recognition Of Trade Union & Prevention Of Unfair Labour Practices Act 1971 • Maharashtra State Tax On Professions, Trades, Callings And Employments Act, 1975 • Maharashtra Workmen's' Home Rent Allowance Act 1983 • Maternity Benefits Act • Minimum Wages (Maharashtra Amendment) Act 1976 • Minimum Wages Act 1948 • Personal Injuries (Compensation Insurance) Act, 1963 • The Employees State Insurance Act, 1948 • The Employment Exchanges (Notification Of Vacancies) Act, 1959 • Weekly Holidays Act, 1942 • Workmen's Compensation Act, 1923

OUR HISTORY AND MAIN OBJECTS

Our Company was incorporated in 1990 under the name of JBM Tools Limited, the SK Arya group (“SKA”) being the then promoters. In 1997, our Company, pursuant to an agreement between SKA and TACO, was converted into a Joint Venture between TACO, its affiliate TIL and SKA. Pursuant to the Scheme of Arrangement sanctioned by the High Court of Judicature at Delhi in June 2001, the Faridabad undertaking of the Company was transferred to erstwhile Precious Estates Private Limited (now known as JBM Auto Limited); the authorized share capital and the paid up capital of the Company was reduced; and the registered office of the Company was shifted from Delhi to Pune.

In April 2002, TACO and TIL bought over SKA’s stake to take its combined holding to 81.35%. Subsequently, TIL transferred its stake (except for 100 shares) to TACO in March 2004 and TACO became the holding company.

Main Objects of our Company

The main objects as set out in the Memorandum of Association of Automotive Stampings and Assemblies Limited are as under:

1. To carry on in India or else where the business of manufacturing, designing, developing, fabricating, assembling, improving, processing, melting, refining, cleaning, normalizing, buying, selling, importing, exporting and dealing in all kinds of tools, including pneumatic tools, hand tools, machine tools, cutting tools, dies, moulds, master models, gauges, templates, Jigs, fixtures, tools holders, boring bars, test instruments, accessories and components thereof.

2. To carry on the business of designing, manufacturing, developing, fabricating, assembling, improving, buying, selling, importing, exporting and dealing in all kinds of pressings, forgings, stampings, rolling, castings, laminations, fabrications, extrusions, automatic machines, electrical, electronic mechanical, components and auto parts.

3. To carry on the businesses of iron masts, iron founders, mechanical and electrical engineers, steel makers, steel converters, tin plate makers, brass founders, metal workers, boiler makers, metallurgist and wood workers.

4. To develop and commercialize technologies in the field of automation including tools, dies, moulds, jigs, fixtures and allied business.

5. To buy, sell, import, export and deal in raw materials, plants and machinery used or required for the business referred to in sub-clause (1) to (4) above.

6. To carry on the business of importers, exporters, general merchants, traders, commission agents, distributors, concessionaries and consultants, in respect of the business referred to in sub-clauses (1) to (5) above.

The objects clause of the Memorandum of Association of our Company enables us to undertake our existing activities.

Changes in the Memorandum of Association of our Company

Since incorporation, the following changes have been made to our Memorandum of Association:

Date of Shareholders’ Changes approval March 9 , 1993 Increase in Authorised Share Capital of the Company from Rs.10 Million to Rs. 50 Million March 30, 1995 Increase in Authorised Share Capital of the Company from Rs.50 Million to Rs.120 Million March 30, 1995 Alteration of Other Objects clause III (c) by adding sub-clause 74 & 75 September 26, 1996 Increase in Authorised Share Capital of the Company from Rs. 120 Million to Rs.140 Million May 14, 1997 Increase in Authorised Share Capital of the Company from Rs. 140 Million to Rs.200 Million June 8, 2001 Reduction of Share Capital of the Company from Rs. 200 Million to Rs. 120 Million pursuant to the Sanction of the Scheme of Arrangement by the Delhi High Court June 8, 2001 Change of registered office from the State of Delhi to Maharashtra (Pune) July 15, 2002 Increase in Authorised Share Capital of the Company from Rs.120 Million to Rs. 268 Million June 30, 2003 Change of name of the Company from JBM Tools Limited to Automotive Stampings and Assemblies Limited March 5, 2008 Increase in Authorised Share Capital of the Company from Rs. 268 Million to Rs. 360 Million

The details of the capital raised by our Company are given in “Capital Structure” on page 19 of the Draft Letter of Offer.

Material Agreements

Our Company in its day to day business has entered into certain agreements; a brief note of the same is given below:

Share Purchase Agreement by and amongst TACO and Gestamp Servicios, S.L.

By a Share Purchase Agreement dated February 13, 2007 executed by and amongst TACO and Gestamp Servicios, S.L., TACO had agreed to sell 3,824,453 fully paid up Equity Shares of the Company aggregating to 37.50% of the issued, subscribed and paid up capital of the Company as on that date. The sale of 3,824,453 equity share was subject to shares tendered by the shareholders of the Company in the open offer made by Gestamp Servicios S.L. pursuant to regulations under the SEBI Takeover Code.

Since only 1,516 Equity Shares were received by Gestamp Servicios S.L. under the open offer, TACO had sold 3,822,937 fully paid-up Equity Shares of the Company.

OUR MANAGEMENT

The management of the Company vests with the Board of Directors comprising of industrialists, professionals and persons having industrial experience. All the Directors on the Board are Non- Executive Directors. The CEO, designated as Manager under the Act, is the overall in charge of the Company. He is assisted by a team of senior personnel to manage the day to day affairs of the Company.

Board of Directors

The following table sets forth details regarding our Board of Directors as on the date on the Draft Letter of Offer:

Name, Father's Nationality Age Other Directorships Name, Designation, Address, Occupation, Term and DIN Name: Mr. Indian 57 • Tata AutoComp Systems Limited Devender S. Gupta years • Tata Toyo Radiator Limited • Tata Johnson Controls Automotive Limited Father’s name: Mr. • Tata Ficosa Automotive Systems Limited Kishan Sarup Gupta • Tata Yazaki Autocomp Limited • TC Springs Limited Designation: • Automotive Composite Systems Chairman, Non- (International) Limited Executive, Non- • TACO Faurecia Design Center Private Independent Director Limited

Tata Visteon Engineering Private limited Address: Panorama • Co-op Housing • Technical Stampings Automotive Limited Society, Ground • Tata Visteon Automotive Private Limited Floor, 203, • Tata AutoComp GY Batteries Private Walkeshwar Road , Limited Mumbai 400 006 • TACO AutoComp Mobility Telematics Limited Occupation: Service • TACO Hendrickson Suspensions Private Limited Term: Liable to • TACO Sasken Automotive Electronics retire by rotation Private Limited • Nanjing Tata Autocomp Systems Limited DIN: 00111666

Name: Mr. Spanish 43 • Acek Nova, S.L. (Spain)

Name, Father's Nationality Age Other Directorships Name, Designation, Address, Occupation, Term and DIN Francisco José years • Acek Bohemia SRO (Czech Republic) Riberas Mera • Acek Czech SRO (Czech Republic) • Acek Investments, SpZoo (Poland) Father’s Name: Mr. • Acek Polska, SpZoo (Poland) Francisco Riberas • Acek Properties SpZoo (Poland) Pampliega • Acek Properties SRO (Czech Republic)

• Acek Real Estate, SRL (Romania) Designation: Non- • Agrícola la Veguilla, S.A. (Spain) Executive, Non- Aguirre Newman Gestamp Solar, S.L. Independent Director • (Spain)

Address: 16 • Araluce, S.A (Spain) Alfonso, XII Street, • Asetym Generación, S.L. (Spain) Madrid Spain 28014 • Asetym Renova, S.A. (Spain) • Autotech Engineering, AIE (Spain) Occupation: • Beroa Grupo Tecnológico, S.L. (Spain) Industrialist • BEYÇELIK GESTAMP, A.S (Spain) • Bikostar, S.A. (Uruguay) Term: Liable to • Cartera Gestamp, S.L. (Spain) retire by rotation • Cartera Gonvarri, S.L. (Spain) • CIE Automotive, S.A. (Spain) DIN: 01732230 • Continental Group Limited (UK) • Corporación Gestamp S.L. (Spain) • Gestamp Automotive India Private Limited • Gestamp Tooling Overseas, Limited (UK) • CP Vehicles Systems (India) Private Limited • CP Projects Limited (UK) • Distribuidora Férrico Industrial, S.A. (Spain) • Esmena, S.L. (Spain) • Estampaciones Martínez, S.A (Spain) • Estampaciones Metálicays Vizcaya, S.A. (Spain) • Esymo Metal, S.L. (Spain) • Galvanizaciones Castellana, S.A. (Spain) • Gescrap Servicios Portuarios, S.L. (Spain) • Gescrap, S.L. (Spain) • Gestamp 2001, S.L. (Spain) • Gestamp Alabama INC (USA)

Name, Father's Nationality Age Other Directorships Name, Designation, Address, Occupation, Term and DIN • Gestamp Automoción, S.L. (Spain) • Gestamp Aveiro S.A. (Portugal) • Gestamp Baires, S.A. (Argentina) • Gestamp Cartera de Mexico, S.L. (Mexico) • Gestamp Cataforesis Vigo, S.L. (Spain) • Gestamp Eolica Polska, Sp. Zo.o. (Poland) • Gestamp Eólica, S.L. (Spain) • Gestamp Finance Luxemburg, SA (Luxemburg) • Gestamp Hardtech, AB. (Sweden) • Gestamp Hungaria, KFT (Hungary) • Gestamp Autocomponents (Kunshan) Co. Limited (China) • Gestamp Linares, S.A. (Spain) • Gestamp Marelli Autochasis, S.L. (Spain) • Gestamp Mexico, S.A. de CV (Mexico) • Gestamp Northamerica Inc (USA) • Gestamp Noury, S.A. (France) • Gestamp Palencia, S.A. (Spain) • Gestamp Polska, Sp.z.o.o. (Poland) • Gestamp Portugal, LDA (Portugal) • Gestamp Puebla, S.A. de C.V (Mexico) • Gestamp Ronchamp (France) • Gestamp Seguidores Solares, S.L. (Spain) • Gestamp Servicios Laborales de Toluca, S.A. de C.V. (Mexico) • Gestamp Servicios, S.L. (Spain) • Gestamp Solar 2007, S.L. (Spain) • Gestamp Solar 2008, S.L. (Spain) • Gestamp Solar Infraestructuras, S.L. (Spain) • Gestamp Solar Mantenimientos, S.L. (Spain) • Gestamp Solar Servicios Auxiliares, S.L. (Spain) • Gestamp Solar, S.L. (Spain) • Gestamp Stadco Holdings, S.L. (Spain) • Gestamp Sweden AB (Sweden) • Gestamp Taubaté, S.A. (Brasil)

Name, Father's Nationality Age Other Directorships Name, Designation, Address, Occupation, Term and DIN • Gestamp Tech, S.L. (Spain) • Gestamp Toledo, S.L.(Spain) • Gestamp Toluca, SA de CV (Mexico) • Gestamp Tooling Services, AIE (Spain) • GESTAMP U.K., Ltd. (UK) • Gestamp US Hardtech, INC (USA) • Gestamp US HARTECH, INC (USA) • Gestamp Vigo, S.A. (Spain) • Gestamp Zener Solar, S.L. (Spain) • Global Dominion Access, S.A. (Spain) • Gonvarri Barcelona, S.L. (Spain) • Gonvarri Bras . Pdtos. Siderurgicos S.A. (Brasil) • Gonvarri Brasil Ser. Admin.(Brasil) • Gonvarri Corporación Financiera, S.L.(Spain) • Gonvarri Galicia, S.A. (Spain) • Gonvarri I. Centro de Servicios, S.L. (Spain) • Gonvarri industrial Maroc, SA Morocco • Gonvarri Industrial, S.L. (Spain) • Gonvarri Italia, SPA (Italy) • Gonvarri Navarra, S.L. (Spain) • Gonvarri Nordesi, S.P.A (Italy) • Gonvarri Polska Sp. z o.o. (Poland) • Gonvarri Portugal, LDA (Portugal) • Gonvarri Ptos. Siderúrgicos, SA (Portugal) • Gonvarri Tarragona, SL (Spain) • Gonvarri Vizcaya, SL (Spain) • Gonvauto Navarra, SA (Spain) • Gonvauto Navarra,S.A. (Spain) • Gonvauto Puebla S.A. de C.V. (Mexico) • Gonvauto Thuringen GmbH (Germany) • Gonvauto, S.A. (Spain) • Gonvhiasa, S.L. (Spain) • Gran Vía 2006, S.L. (Spain) • Griwe Innovative Umformtechnik GM (Germany) • Griwe Innovative Umformtechnik GmbH

Name, Father's Nationality Age Other Directorships Name, Designation, Address, Occupation, Term and DIN (Germany) • Griwe System Productions GmbH (Germany) • Griwe Werkzeug Productions GmbH (Germany) • Halekulani, S.L. (Spain) • Hierros Villaverde, S.A. (Spain) • Hierros y Aplanaciones, S.A. (Spain) • Holding Gonvarri Navarra, S.L. (Spain) • Industrial Ferrodistribuidora, S.A. (Spain) • Ingeniería Global Metalbages, S.A. (Spain) • Inmobiliaria Acek, S.L. (Spain) • Inmobiliaria La Sagra Alta, S.L. (Spain) • INSSEC, S.L. (Spain) • Instituto de Consultoría Técnica yempresarial, S.L. (Spain) • Inverscan, A.B. (Sweden) • Investment Circle, S.A. (Luxembourg) • Kartek Gestamp Corporation (Joint Stock Company) (Korea) • Laminados Siderúrgicos Vitoria, S.A.(Spain) • Logesta Gestión de Transporte, S.A.(Spain) • Logística Integrada de Materiales Auxiliares, S.L. (Spain) • Losiana, S.L. (Spain) • Matricería Deusto S,L,(Spain) • MB Abrera, S.A.(Spain) • MB Aragón P51, S.L. (Spain) • MB Aragón, S.A.Sociedadunipersonal (Spain) • MB Hidroacero, S.A. (Spain) • MB Levante, S.L. (Spain) • MB Pamplona, S.A. (Spain) • MB Solblank Navarra, S.A. (Spain) • Metalbages P51, S.L. (Spain) • MB Metalbages do Brasil LTDA. (Brasil) • MB Solblank Navarra, S.L.(Spain) • Metalbages Aragón P21, S.L. (Spain)

Name, Father's Nationality Age Other Directorships Name, Designation, Address, Occupation, Term and DIN • Metalbages Santpedor, S.L.(Spain) • Metalbages XXI, S.L. (Spain) • Metalbages, S.A. (Spain) • Metalcomponentes MB Navarra, S.L.(Spain) • Modular Business & Ingeniería, S.L. (Spain) • Obratel Construcciones y Servicios, S.L. (Spain) • Pavind Industrias de Betao, S.A. (Portugal) • Photosolar Almansa Baffeto, S.L. (Spain) • Photosolar Medina 1, S.L. (Spain) • Photosolar Medina 10, S.L.(Spain) • Photosolar Medina 11, S.L.(Spain) • Photosolar Medina 2, S.L.(Spain) • Photosolar Medina 3, S.L.(Spain) • Photosolar Medina 4, S.L.(Spain) • Photosolar Medina 5, S.L.(Spain) • Photosolar Medina 6, S.L.(Spain) • Photosolar Medina 7, S.L.(Spain) • Photosolar Medina 8, S.L.(Spain) • Photosolar Medina 9, S.L. (Spain) • Promociones coruñesas del Siglo XXI, S.L. (Spain) • Prosisa, A.G. (Swizterland) • Recuperaciones Medioambientales Industriales, S.L. (Spain) • Regional Investimentos e serviçios LDA. (Portugal) • Rimpamer Inversiones, S.L.(Spain) • Rotabook Servicios de Impresión, S.L. (Spain) • SCI Rue Paul Strauss (France) • Solblank, S.A. (Spain) • Tavol - Produtos Sid. (Portugal) • Tavol Internacional, S.L. (Portugal) • Tecnología Aplicable a los Servicios Industriales, S.L. (Spain) • Todlem, S.L. (Spain)

Name, Father's Nationality Age Other Directorships Name, Designation, Address, Occupation, Term and DIN • Traselnor, S.L.(Spain) • UTE Construcción Fuente Álamo (Spain) • UTE Construcción Fuente Álamo FASE 2 (Spain) • UTE Construcción Fuente Alamo FASE 3 (Spain) • UTE Mantenimiento Fuente Álamo (Spain) • UTE Mantenimiento Fuente Álamo FASE 2 (Spain) • UTE Mantenimiento Fuente Alamo FASE 3 (Spain) • Vega Altea, S.L. (Spain)

Name: Mr. Ramesh Indian 63 • Foseco India Limited A. Savoor years • E.I.D Parry Limited • Divgi Warner Private Limited Father’s name: • Fidelity Fund Management Private Limited Late Mr. Amrutrao Savoor

Designation: Independent Director

Address: 201, Pineview, 9, Edward Road, Bangalore - 560 052

Occupation: Professional Independent Director

Term: Liable to retire by rotation

DIN: 00149089

Name: Mr. Pradeep Indian 65 • Accor Radhakrishna Corporate Services Pvt

Name, Father's Nationality Age Other Directorships Name, Designation, Address, Occupation, Term and DIN Mallick years Ltd. • Avaya GlobalConnect Ltd. Father’s name: • Auro Mira Energy Co. Pvt. Ltd. Late Mr. S.K. • Blue Star Limited Mallick • ELANTAS Beck India Ltd. • ESAB India Ltd Designation: • Mount Everest Mineral Water Ltd. Independent Director • Pragati Leadership Institute Pvt. Ltd.

• Royal Images Direct Marketing Pvt. Ltd. Address: A/2, SBI Funds Management Pvt. Ltd. Pallonji Mansion, • 43, Cuffe Parade, • Tube Investments of India Ltd. Mumbai 400 005

Occupation: Professional Independent Director.

Term: Liable to retire by rotation

DIN: 61256

Name: Mr. S. Indian 58 • THDC Limited Ramakrishnan years • Tata Projects Ltd. • Avaya GlobalConnect Ltd. Father’s name: • The Tata Power Company Ltd. Late Mr. • Tata Power Trading co. Ltd. Ramaiengar • Powerlinks Transmission ltd. Sowmyan • Af – Taab Investment Co. Ltd.

• Maithon Power Ltd. Designation:

Independent Director • NELCO Ltd. • North Delhi Power Ltd. Address: A-701, • Coastal Gujarat Power Ltd. NCPA Apartments • Tata Power (Mauritius) Ltd. 'A' Block, Nariman • Tata Power (Cyprus) Ltd. Point,Mumbai 400 • PT Kaltim Prima Coal 021 • PT Arutmin Indonesia • IndoCoal Resourses (Cayman) Ltd.

Name, Father's Nationality Age Other Directorships Name, Designation, Address, Occupation, Term and DIN Occupation: Service • PT Indocoal Kalsel Resourses • PT Indocoal Kaltim Resourses Term: Liable to retire by rotation

DIN: 00005090

Name: Mr. Spanish 49 Nil Francisco López years Peña

Father’s name: Mr. José Antonio López Ibisate

Designation: Non- Executive, Non- Independent Director

Address: 7, Buho Street, Pozuela De Alarcon, Madrid Spain 28223

Occupation: Service

Term: Liable to retire by rotation

DIN: 01790019

Name: Mr. Indian 59 • Tata AutoComp Systems Limited Rameshwar S. years • Tata Marcopolo Motors Limited Thakur • Tata Motors Thailand Limited • TAL Manufacturing Solutions Limited Father’s name: Mr. • Automobile Corporation of Goa Limited Tahal Singh Thakur • TC Springs Ltd.

• Automotive Composite Systems Designation: Non- (International) Ltd. Executive, Non-

Independent Director

Name, Father's Nationality Age Other Directorships Name, Designation, Address, Occupation, Term and DIN

Address: Flat No. 205, Burlington, Hiranandani Estate, Patlipada, Thane West Thane 400 607

Occupation: Service

Term: Liable to retire by rotation

DIN: 00020126

Brief biography of our Directors

Mr. Devender S. Gupta, aged 57 years, is the Non-Executive Chairman and of our Company. He is a B. E. (Mech Engg.) and P.G.D.B.A from IIM Ahmedabad. He was appointed as Chairman on November 14, 1997.

Mr. Francisco José Riberas Mera, aged 43 years, is the Non-Executive Director of our Company. He has done his law and business administration degrees from the University of Pontificia De Comillas in Madrid, ICADE College. He is an industrialist.

Mr. Ramesh A. Savoor, aged 63 years, is the Non – Executive, Independent Director of our Company. He has done his B. Sc. (Chemistry) and B. Sc (Tech.). He is the former Managing Director of Castrol India Limited.

Mr. Pradeep Mallick, aged 65 years, is the Non – Executive, Independent Director of our Company. He is graduated in Electrical Engineering from IIT, Madras and received a Diploma in Business Management from UK. He is a ‘Chartered Engineer’, Fellow of the Institution of Engineering & Technology (FIET), London. He was honoured by IIT Madras with the distinguished Alumnus Award. He is the former Managing Director of Wartsila India Limited. He currently serves on the board of several companies as an Independent Director.

Mr. S. Ramakrishnan, aged 58 years, is the Non – Executive, Independent Director of our Company. He is B. Tech. (Mechanical), P.G.D.M from IIM–Ahmedabad. He is the former Managing Director of Tata Teleservices Limited and former Deputy Managing Director of Indian Hotels Company Limited. He is currently Executive Director – Finance of The Tata Power Company Limited.

Mr. Francisco López Peña, aged 49 years, is the Non – Executive Director of our Company. He has a Civil Engineering degree from the University Politecnica of Barcelona and a MBA degree in the Spanish IESE Business School from the University of Navarra. He has been associated with the Gestamp Group since 1999.

Mr. Rameshwar S. Thakur, aged 59 years, is the Non-Executive Director of our Company. He is also the Executive Director of Tata AutoComp Systems Limited (TACO). Prior to joining TACO, he worked with Tata Motors Limited for over 35 years. During his tenure with Tata Motors Limited, he was responsible for finance, business planning, treasury, mergers and acquisitions, negotiations with state governments for new projects and manufacturing engineering. He was actively involved in the management of overseas ventures of Tata Motors Limited as well as joint ventures in India.

Compensation of our Manager and Directors

Manager/Chief Executive Officer (“CEO”)

The Company has appointed Mr. Nagaraju Srirama, as the Chief Executive Officer (designated as Manager under the Companies Act, 1956) for a period beginning from February 16, 2007 to March 31, 2010. The Company in its AGM held on August 28, 2007 got Shareholders’ approval for the payment of minimum remuneration for the period of three years, stated herein below:

Salary In scale of Rs. 65,000 to Rs. 125,000 per month with authority to the Board and/or Remuneration Committee to fix his salary within the above scale from time to time. Present salary being Rs. 91,100 per month. The increments may be decided by the Board and/or Remuneration Committee from time to time subject however to an amount not exceeding Rs. 125,000 per month. Incentive remuneration Upto 200% of salary to be paid at the discretion of the Board and/or Remuneration Committee and based on certain performance criteria. Perqusites Perquisites and allowances shall be subject to maximum of 140% of the annual salary. House The Company will provide hired unfurnished accommodation; or where no accommodation is provided by the Company then HRA shall be paid. The rent for accommodation or HRA shall be subject to a ceiling of amount equal to 70% of salary.

He shall be entitled to hard furnishings as per the applicable rules of the Company, the present ceiling being Rs. 225,000 for a block of five years. Provident and Contribution to provident and superannuation fund shall be as per Superannuation Fund the rules of the Company Gratuity fund Contribution to gratuity fund shall be as per the rules of our Company Medical reimbursement Reimbursement of expenses incurred by the CEO for self and his

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family, subject to a ceiling of one month’s salary in a year or three months’ salary over a period of three years. Leave Leave with full pay including encashment of unavailed earned leave at the end of the tenure of the CEO as per the rules of our Company Leave travel concession For the CEO and his family once in a year in accordance with the rules of our Company Club fees Fees of one club shall be paid by our Company Mediclaim & Insurance The CEO is entitled to the benefit of group mediclaim and group personal accident insurance. Housing Loan/Other Housing Loan/Other Loans/Interest Subsidy shall be as per the rules Loans/Interest Subsidy of the Company in force from time to time Other perquisites Car with driver and telephone at the residence of the CEO. Provision of car for use on Company’s business and telephone will not be considered as perquisites. Personal long distance calls and use of car for private purposes shall, however, be paid for by the CEO.

Details of his remuneration* for the year ended March 31, 2008 are as follows:

Manager/CEO Salary (Rs. in Payment Perquisite value of Retirement Mn) of/Provisions for rent & maintenance benefits (Rs. incentive (Rs. in Mn) in Mn) Remuneration (Rs. in Mn) Mr. Nagaraju 0.99 1.73 1.25 0.27 Srirama * The Remuneration does not include gratuity and compensated absences provided on the basis of actuarial valuation in the accounts.

Non-Executive Directors

No remuneration is paid to any of our Non-Executive Directors. The Company has paid sitting fees to the Non-Executive Directors for attending the meetings of the Board/Committee of Directors.The sitting fees paid are Rs. 10,000 for every Board meeting attended and Rs. 5,000 for every committee meeting attended.The details of sitting fees paid during Fiscal 2008 are as follows:

Sl. Name of the Director Amount (Rs.) No. 1 Mr. Devender S. Gupta 50,000 2 Mr. Francisco José Riberas Mera 20,000 3 Mr. Ramesh A. Savoor 85,000 4 Mr. Pradeep Mallick 20,000 5 Mr. S. Ramakrishnan 65,000 6 Mr. Francisco López Peña 20,000 7 Mr. Raman Nanda* 55,000

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Sl. Name of the Director Amount (Rs.) No. 8 Mr. Satish Pradhan* 20,000 9 Mr. Rajiv Dube* 65,000 10 Mr. Rajiv Bakshi* 10,000 11 Mr. Atul Bansal* 5,000 *At present, these Directors are no longer on our Board. Please refer to “Changes in our Board during last three years” for further details in this regard

Shareholding of our Directors in our Company

None of the Directors of our Company are holding any Equity Shares of the Company.

Interest of our Directors

Except as stated in “Related Party Transactions” on page 144 of the Draft Letter of Offer, and to the extent of sitting fees for attending Board or committee meetings, in our Company, the Directors do not have any other interest in our business.

All of our Directors may be deemed to be interested to the extent of fees, if any, payable to them for attending meetings of the Board or a Committee. All our Directors may also be deemed to be interested to the extent of Equity Shares, if any, held by their relatives in the Company, or that may be subscribed for and allotted to them, out of the present Issue in terms of the Draft Letter of Offer and also to the extent of any dividend payable to them and other distributions in respect of the said Equity Shares. The Directors may also be regarded as interested in the Equity Shares, if any, held by or that may be subscribed by and allotted to the companies, firms and trust, in which they are interested as directors, members, partners and/or trustees.

Except as stated otherwise in the Draft Letter of Offer, we have not entered into any contract, agreement or arrangement in which our Directors are interested directly or indirectly and no payments have been made to them in respect of these contracts, agreements or arrangements or are proposed to be made to them.

Changes in our Board of Directors during the last three years

Sl. Name of Director Date of Date of Reasons No. appointment retirement/resignati on 1 Mr. Rameshwar April 29, 2008 -- Appointment as Thakur Additional Director 2 Mr. Raman Nanda -- April 4, 2008 Resignation 3 Mr. Satish Pradhan -- March 20, 2008 Resignation 4 Mr. Rajiv Dube -- February 27, 2008 Resignation 5 Mr. Pradeep Mallick December 28, 2007 -- Appointment as Additional Director 6 Mr. Fransisco José October 1, 2007 -- Appointment as

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Sl. Name of Director Date of Date of Reasons No. appointment retirement/resignati on Riberas Mera Additional Director 7 Mr. Fransisco López October 1, 2007 -- Appointment as Peña Additional Director 8 Mr. Atul Bansal -- August 28, 2007 Retirement by Rotation 9 Mr. Rajiv Bakshi October 18, 2006 August 28, 2007 Appointment as Additional Director and Expiry of term thereof 10 Mr. B. Venkatramani October 21, 2005 June 29, 2006 Appointment as Additional Director & Resignation 11 Mr. Shantanu Rudra October 21, 2005 February 22, 2006 Appointment as Additional Director & Resignation 12 Mr. Ramesh A. December 29, 2005 -- Appointment as Savoor Additional Director 13 Mr. S. Ramakrishnan December 29, 2005 -- Appointment as Additional Director 14 Mr. Gajendra October 21, 2005 December 29, 2005 Appointment as Chandel Additional Director & Resignation 15 Mr. Sandip October 21, 2005 December 29, 2005 Appointment as Choudhuri Additional Director & Resignation 16 Mr. Rajiv Bakshi -- October 21, 2005 Resignation

Details of the Borrowing Powers

Pursuant to the provisions of section 293(1) (d) of the Act, the Shareholders, at the AGM held on August 28, 2007, have authorised the Board of Directors of the Company to borrow a sum exceeding the aggregate of the paid-up capital and free reserves of the Company subject to a maximum limit of Rs. 3,000 million.

Corporate Governance

As on the date of filing the Draft Letter of Offer, there are seven Directors on our Board with three of them being Independent Directors. Since, our Non-Executive Chairman Mr. Devender S. Gupta is the managing director of TACO, one of our Promoters; we are currently in the process of inducting one more Independent Director in our Board.

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We have formed an ‘Audit Committee’ and a ‘Shareholders Grievance and Compliance Committee’ in line with the Corporate Governance norms. The details of the ‘Audit Committee’ and the ‘Shareholders Grievance and Compliance Committee’ are as follows:

1. Audit Committee

The Company has framed an Audit Committee Charter which covers all the Audit Committee related requirements of the revised corporate governance code as well as the requirements of section 292A of the Companies Act, 1956. The Audit Committee comprises three members; all of them including the Chairman are Independent Directors. All the members have relevant finance and audit exposure. The Chairman of the committee is Mr. Ramesh A. Savoor. Mr. S. Ramakrishnan and Mr. Pradeep Mallick are the other members.

The Audit Committee meetings are also attended by the CEO and the CFO as invitees. The representatives of Statutory Auditors and Internal Auditors are the permanent invitees to the Audit Committee meetings.

The Secretary of the Company acts as the Secretary of the Audit Committee.

The Chairman of the Audit Committee was present at the Annual General Meeting held on August 28, 2007.

• Terms of Reference:

The role of the Committee includes:

9 overseeing the Company’s financial reporting process and disclosure of financial information to ensure that the financial statement is correct, sufficient and credible;

9 reviewing annual and quarterly financial statements with management before submission to the Board;

9 reviewing the adequacy of internal control systems with management, external and internal auditors; and

9 reviewing the significant related party transactions and reviewing the Company’s financial risk and management policies.

The Audit Committee met five times during the Fiscal 2008.

2. Shareholders Grievance and Compliance Committee

The Shareholders Grievance and Compliance Committee comprises of three Non-Executive Directors. Mr. Ramesh A. Savoor is the Chairman of the committee and Mr. S. Ramakrishnan and Mr. Rameshwar S. Thakur are the other members of the committee.

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Terms of Reference

The functioning and terms of reference of the Committee are as prescribed and in due compliance with the Listing Agreement with the Stock Exchanges and include:

9 to look into redressing of shareholder complaints like delay in transfer of shares, non- receipt of balance sheet, non-receipt of declared dividend etc.

9 to review the existing ‘Investor Redressal System’ and suggest measures for improvement

9 to suggest improvements in investor relations

9 to set forth the policies relating to and overseeing the implementation of the ‘Tata Code of Conduct for Prevention of Insider Trading and Code of Corporate Disclosure Practices’.

Mr. Shailendra Dindore, Company Secretary is the compliance officer with respect to shareholders / investors related matters. The Company has not received any complaint from the shareholders during Fiscal 2008.

The Company’s Equity Shares are compulsorily traded in dematerialized form. To expedite transfers in physical form, a committee of executives of the Company has been authorised to look into various matters like approving share transfers/transmissions, issue of new certificates in split/consolidation, etc. The Committee currently comprises of the following executives:

• Chief Executive Officer, Mr. Nagaraju Srirama; • Chief Financial Officer, Mr. Parshuram G. Date; and • Company Secretary, Mr. Shailendra Dindore

Equity Share transfers approved by the Committee are placed at the Board meeting from time to time. The Company attends to investor correspondence promptly. There are no pending Equity Share transfers as on May 31, 2008.

The Committee met once during Fiscal 2008.

Other Committees

The Company has constituted a ‘Remuneration Committee’ in order to comply with the amended provisions of Schedule XIII to the Companies Act, 1956. The remuneration of the CEO, designated as ‘Manager’ under section 269 of the Companies Act, 1956 is approved by the Remuneration Committee.

The Remuneration Committee comprises of five members, of whom three are independent. Mr. Ramesh A. Savoor, Mr. Pradeep Mallick and Mr. S. Ramakrishnan are independent

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Directors on the Committee. Mr. Francisco López Peña and Mr. Rameshwar S. Thakur are the other members of the Committee.

The Terms of Reference of this committee include determination of compensation payable to the Managerial Person including revision thereof, appraisal of his performance and the determination of his incentive remuneration.

Key Managerial Personnel

The brief details of the key managerial personnel of our Company are as follows:

Name Age Designation Gross Qualification Month & Previous (years) Remuneration Year of Employment paid* Joining (Rs in Mn)

Mr. Nagaraju 48 Manager/ 3.23 B.E. (Mech. September, Grindwell Srirama CEO Engg.); M.Tech 2006 Norton (Quality, Limited Reliability & Operations Research) from Indian Statistical Institute, Kolkata; Post Graduate Diploma in Statistical Quality Control from Indian Statistical Institute, Kolkata; Diploma in Financial Management (ICFAI); Diploma in Business Management (IIMS, New Delhi)

Mr. Aditya 45 Head- 1.31 B.E. (Elec. November, Pidilite Kumar Business Engg.); Post 2005 Industries Mishra Excellence Graduate Limited Diploma in Business Management

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Name Age Designation Gross Qualification Month & Previous (years) Remuneration Year of Employment paid* Joining (Rs in Mn)

Mr. Girish 42 Head- 1.58 B. Com, MLS June, 2005 Positive Shende Human (MPM) Packaging Resources Private Limited

Mr. 53 General 1.45 B.E. (Mech. February, Mungi Sundarraman Manager– Engg.), MBA 2007 Brothers Pvt. Iyer Projects Ltd.

Mr. 40 General 1.67 B.E. (Mech. September, Panse Group Sachanand Manager – Engg.) 2006 Dakhneja Engineering

Mr. Sanjay 47 General 1.61 B.A. (Eco & July, 2006 JBM Auto Arora Manager – Maths), Diploma Limited Marketing in Mechanical and Engineering, Materials MBA

Mr. Prashant 42 General N.A. B.E. (Production); April, 2008 Tube Shriram Manager – Post Graduation Products of Pande Business in Marketing India Limited Development Management

* Gross Remuneration paid for Fiscal 2008

All the key managerial personnel are permanent employees of our Company and none of them are related to each other.

The abovementioned remuneration of each of our key managerial personnel is as per the computation as required under section 217(2A) of the Companies Act, 1956 and the Companies (Particulars of Employees) Rules, 1975.

Brief Profile of the Key Managerial Personnel

Mr. Nagaraju Srirama

Mr. Nagaraju Srirama is a B.E. (Mech. Engg.) from Bangalore University and M.Tech in Quality, Reliability & Operations Research from Indian Statistical Institute, Kolkata. He has also done Post Graduate Diploma in Statistical Quality Control from Indian Statistical Institute, Kolkata and Diploma in Financial Management from ICFAI, Hyderabad and

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Diploma in Business Management from IIMS, New Delhi. He started his career with M/s. Sundaram Clayton Limited in 1985 and has also worked with M/s. Facit Asia Limited. Before joining Our Company, he was the Business Head of M/s Grindwell Norton Limited, a company of Saint-Gobain Group. He has a total work experience of 23 years.

Mr. Aditya Kumar Mishra

Mr. Aditya Kumar Mishra is an Electrical Engineer and has done Post Graduate Diploma in Business Management from XLRI, Jamshedpur. He is a Certified Lead Auditor for ISO and has been an external assessor for TBEM. He also has in-depth knowledge of Six Sigma. He has been working with the Company since November 2005. Before joining the Company, he worked for 19 years out of which for 17 years he was with Tata Steel Limited and for 2 years he was with Pidilite Industries Limited.

Mr. Girish Shende

Mr. Girish Shende is heading the Human Resources and Administration functions in the Company. He has been with us for 3 years. He worked with several organizations, including Hoechst Roussel Vet and Philips India Limited for 18 years before joining our Company.

Mr. Sundarraman Iyer

Mr. Sundarraman Iyer is a B.E. (Mech. Engg.), MBA and has around 24 years of experience in initiation, erection and commissioning of new projects. He has worked with Bajaj Auto Limited and Texmaco Limited., Indonesia. He has experience of commissioning forging, sheet metal plants in India as well as overseas. Prior to joining the Company, he was the chief executive of M/s. Mungi Brothers Private Limited.

Mr. Sachanand Dakhneja

Mr. Sachanand Dakhneja is a B.E. (Mech.Engg.) from Pune University. He has around 18 years of experience in development of sheet metal and tubular assemblies for automobiles and has worked extensively in the area of engineering operations involving design and development, development of jigs, fixtures and production aids for machined & fabricated components and assemblies. He is heading the Engineering function in our Company. Prior to joining our Company, he has worked in Bajaj Auto Limited for 13 years and with Panse Group of Companies for 3 years.

Mr. Sanjay Arora

Mr. Sanjay Arora is a B.A. (Economics & Maths), Diploma in Mechanical Engineering from BTE, Delhi and MBA from Delhi University. He has around 26 years of experience in Automobile and Steel Industry and has worked extensively in the area of sales and marketing. He is heading the marketing and materials functions in the Company. Prior to joining our Company, he worked with M/s.Rasandik Engineering Industries India Limited

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and JBM Auto Limited.

Mr. Prashant Shriram Pande

Mr. Prashant Shriram Pande is a B.E. (Production) and has done his Post Graduation in Marketing Management from Pune University. He has around 20 years of experience in marketing and has worked in the area of sales & marketing, business analysis, strategic planning and implementation, business development, channel & network development. Prior to joining our Company, he was working with M/s. Tube Products of India Limited.

Other Managerial Personnel

Mr. Parshuram G. Date

Mr. Parshuram G. Date, 52 years, has been deputed as Chief Financial Officer of our Company by TACO since April 2000. He joined TACO in 1997. Before joining TACO, he worked with A. F. Fergusson & Company and M/s.Alfa Laval (India) Limited. During his stint of 16 years in Alfa Laval (India) Limited, he handled MIS, Taxation, Finance and Accounts. He is a qualified Chartered Accountant. He has also completed a course in System Analysis and Computer Programming.He has total experience of 27 years. In Fiscal 2008, the gross remuneration paid to him amounts to Rs. 2.67 million.

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Organization Structure

The following schematic diagram shows our existing organization structure:

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Shareholding of Key Managerial Personnel in our Company

None of our Key Managerial Personnel hold Equity Shares in our Company.

Interest of Key Managerial Personnel

The Key Managerial Personnel of our Company do not have any interest in our Company other than to the extent of the remuneration or benefits to which they are entitled to as per their terms of appointment and reimbursement of expenses incurred by them during the ordinary course of business.

Bonus or Profit Sharing Plan for our Key Managerial Employees

Our Company does not have any bonus or profit sharing plan for the employees (including key managerial personnel).

Employee Stock Option Plan

Our Company does not have any stock option plan or stock purchase scheme for the employees.

Payment or Benefit to Officers of our Company (Non-Salary Related)

No non-salary related amount or benefit has been paid or given within the two preceding years or intended to be given to any of the Directors or key managerial personnel.

Remuneration

The remuneration of each Key Managerial Personnel includes salary, special allowance, HRA, company’s contribution to provident fund and superannuation fund, leave travel concessions, reimbursement of medical expenses, performance based incentive remuneration and other perquisites as may be applicable in each case in terms of the rules of our Company.

Changes in our Key Managerial Personnel during last three years (other than superannuation)

Sl. Name and Designation Date of Date of Reasons No. Appointment Resignation 1 Mr. Anshuman Dev, March 26, 2007 May 10, 2008 Transferred to Chief Operating Officer Automotive Composite Systems (International) Ltd. 2 Mr. Prashant S Pande, April 21, 2008 -- Appointment Head – Business

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Sl. Name and Designation Date of Date of Reasons No. Appointment Resignation Development 3 Mr. Vijay Kumar May 18, 2003 March 4, 2007 Resigned from services Bhatia, Head - Technology Development and new Projects 4 Mr. Rajesh Sahay, December 2, February 24, Resigned from services Chief Operating Officer 2005 2007 5 Mr. Sundarraman Iyer, February 23, -- Appointment Head - Projects 2007 6 Mr. C Srinivas, June 11, 2005 November 22, Resigned from services Head - Materials 2006 7 Mr. Nagaraju Srirama, September 04, -- Appointment Chief Executive Officer 2006 8 Mr. Sachanand September 1, -- Appointment Dakhneja, 2006 Head - Engineering 9 Mr. Sanjay Arora, July 31, 2006 -- Appointment Head – Marketing & Materials 10 Mr. Vilas Divadkar, April 4, 2005 April 15, 2006 Resigned from services Chief Executive Officer 11 Mr. Aditya Kumar November 20, -- Appointment Mishra, Head Business 2005 Excellence 12 Mr. Indrajeet May 25, 2005 October 7, 2005 Resigned from services Bhattacharya, Head - Marketing 13 Mr. O.P. Agnihotri, February 12, June 30, 2005 Resigned from services Head – Human 2001 Resources 14 Mr. Girish Shende, June 6, 2005 -- Appointment Head – Human Resources

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PROMOTER

OUR PROMOTERS

Tata AutoComp Systems Limited (TACO)

TACO was incorporated on October 17, 1995 under the Companies Act, 1956. The registered office of TACO is at Bombay House 24, Homi Mody Street, Fort, Mumbai 400 001.

Currently, TACO is engaged in the business of trading and manufacturing of parts and components for automobiles.

Shareholding Pattern

Name of the shareholder No. of equity shares % shareholding held Tata Industries Limited 57,704,086 34.40% Dilip Sudhakar Pendse 50 -- Farrokh Kaikhushru Kavarana 150 -- Devender S. Gupta 50 -- Noshir Jal Driver 50 -- Tata Motors Limited 83,867,086 50.00% Tata Investment Corporation Limited 2,266,712 1.35% Tata Sons Limited 23,896,332 14.25% Total 167,734,516 100.00%

Board of directors

The board of directors of TACO as on date comprises:

• Mr. Ratan .N. Tata (Chairman) • Mr. Devender S.Gupta (Managing Director) • Mr. Rameshwar S. Thakur (Executive Director) • Mr. K.A.Chaukar. • Mr. R.Gopalakrishnan • Mr. Satish Pradhan • Mr. Alan Rosling • Mr. R.R.Bhinge

Financial Performance

The brief financials of TACO for Fiscal 2007, Fiscal 2006 and Fiscal 2005 are given below:

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(Rs. in Mn except per share data) Particulars Year ended March 31, 2007 March 31, 2006 March 31, 2005 Equity Share Capital* 1,677.35 1,677.35 1,677.35 Preference Share Capital 700.00 700.00 700.00 Reserves(excluding revaluation reserves) 929.43 671.59 356.35 Income from Sales and Services 4,142.96 2,440.19 2,367.37 Total Income 4,415.84 2,695.13 2,573.48 Profit/(Loss) After Tax 315.17 371.11 306.79 Earning Per Share (EPS) (Rs.) 1.54 1.88 1.89 Net Asset Value** (NAV) (Rs. per share) 15.54 14.00 12.12 *Equity Share with face value of Rs. 10 each ** Net worth for the purpose of determination of NAV, is computed as summation of equity share capital and reserves and surplus (excluding revaluation reserve) less miscellaneous expenses not written off and accumulated losses

TACO has not become a sick company within the meaning of Sick Industrial Companies (Special Provisions) Act, 1985 and it is not under winding up. Further, TACO has confirmed that it has not been declared as a wilful defaulter by the RBI or any other governmental authority and there are no violations of securities laws committed by it in the past or are pending against it.

We confirm that the PAN of TACO, bank account number of TACO, the registration number of TACO and the address of the Registrar of Companies where TACO is registered have been submitted to the Stock Exchanges where our Equity Shares are proposed to be listed at the time of filing the Draft Letter of Offer.

Companies with which TACO has disassociated in the last three years

Except as stated herein below, TACO has not disassociated itself with any company in the last three years:

Name of the Company: Tata Yutaka AutoComp Limited Date of Disassociation: August 9, 2006 Reason of Disassociation: Termination of joint venture

Interests of TACO in the Company

Except as stated in “Related Party Transactions” on page 144 of the Draft Letter of Offer, and to the extent of Shareholding in the Company, TACO does not have any other interest in the Company’s business.

Promise versus Performance

No public issue or rights issue has been made in the last three years.

Common Pursuit

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One of our Group Companies promoted by TACO, Technical Stampings and Assemblies Limited is also engaged in business similar to that of our Company.

Gestamp Servicios, S.L. (Gestamp)

Gestamp was incorporated on March 5, 1999 under the laws of Spain. The registered office of Gestamp is 16, Alfonso, XII Street, Madrid Spain, 28014.

Gestamp is into stamping and assembling and is also provides technical support and other services in terms of sales and administration to companies in the Gestamp group. In addition to this, it also acts as a holding company for certain mettalurgical companies which manufacture metallic parts for the automotive sector.

Shareholding Pattern

Name of the shareholder No. of equity shares held % shareholding Gestamp Automoción, S.L. 166,612 99.99% Gestamp Toledo, S.L. 1 00.01% Total 166,613 100.00%

Board of directors

The board of directors of Gestamp as on date comprises:

• Mr. Francisco José Riberas Mera (President) • Mr. Juan María Riberas Mera (Secretary) • Mr. Francisco Riberas Pampliega (Director)

Financial Performance (Audited Financial Performance)

The brief financials of Gestamp for the years ending December 31, 2006, December 31, 2005 and December 31, 2004 are given below:

(Rs. in Mn except per share data) Particulars For the year ended December 31, December 31, December 31, 2006 2005 2004

Equity Share Capital* 66.90 66.90 66.90 Reserves (excluding revaluation reserve) 595.85 206.90 49.31 Sales 24,316.93 18,253.12 15,663.70 Total Income 24,658.78 18,619.30 15,697.86 Profit/(Loss) After Tax 388.95 157.59 265.94 Earning Per Share (EPS) (Rs.) 2,334.63 945.87 1,596.13 Net Asset Value** (NAV) (Rs. per share) 3,977.79 1,643.37 697.50

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*Equity Share with face value of Euro 6.02 each ** Net worth for the purpose of determination of NAV, is computed as summation of equity share capital and reserves and surplus (excluding revaluation reserve) less miscellaneous expenses not written off and accumulated losses

We confirm that the Tax Identification No. / VAT Number, bank account number, the registration details along with the address of the Commercial Registrar of Madrid have been submitted to the Stock Exchanges where our Equity Shares are proposed to be listed at the time of filing the Draft Letter of Offer.

Companies with which Gestamp has disassociated in the last three years

Except as stated herein below, Gestamp has not disassociated itself with any company in the last three years:

Name of the Company: Gestamp 2001, S.L. Date of Disassociation: November 14, 2007 Reason of Disassociation: Business Restructuring

Interests of Gestamp in the Company

Except as stated in “Related Party Transactions” on page 144 of the Draft Letter of Offer, and to the extent of Shareholding in the Company, Gestamp does not have any other interest in the Company’s business.

Promise vs Performance

No public issue or rights issue has been made in the last three years.

Common Pursuit

Nil

Tata Industries Limited (TIL)

TIL was incorporated on April 7, 1945 under the Indian Companies Act, 1913. The registered office of TIL is at Bombay House 24, Homi Modystreet, Fort, Mumbai 400 001.

Currently, TIL provides management consulting services and e-learning. It is also a promoter of new industrial enterprises and an investment holding company.

Shareholding Pattern

Name of the shareholder No. of equity % shareholding shares held Promoters:

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Name of the shareholder No. of equity % shareholding shares held Tata Sons Limited 21,001,899 28.69% Other Tata companies: Ewart Investments Limited 198,629 0.27% Tata Steel Ltd. 5,628,388 7.67% Tata Motors Ltd. 6,665,780 9.08% Tata Chemicals Ltd. 6,574,202 8.96% Tata International Ltd. 2,897,951 3.95% Voltas Ltd. 870,480 1.19% Tata Tea Ltd. 4,346,294 5.92% The Tata Power Co. Ltd. 3,551,903 4.84% Af-taab Investment Co. Ltd. 1,000,543 1.36% Taj Investment & Finance Co. Ltd. 4,274,590 5.82% Kalimati Investment Co. Ltd. 383,609 0.52% Sheba Properties Ltd. 870,217 1.19% Tata Investment Corporation Ltd. 451,193 0.61% Non Promoter: JSH (Mauritius) Ltd. 14,678,920 20.00% Total 73,394,598 100.00%

Board of Directors

The board of directors of TIL as on date comprises:

• Mr. Ratan N. Tata, Chairman • Mr. K. A. Chaukar, Managing Director • Mr. F. K. Kavarana • Mr. N. A. Soonawala • Mr. R. K. Krishna Kumar • Mr. Ishaat Hussain • Mr. S. Ramadorai • Mr. Nawshir Mirza • Mr. B. Muthuraman • Mr. P. R. Menon • Mr. Ravi Kant

Financial Performance

The brief financials of TIL for Fiscal 2007, Fiscal 2006 and Fiscal 2005 are given below:

(Rs. in Mn except per share data) Particulars For the year ended March 31, March 31, March 31, 2008 2007 2006

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Particulars For the year ended March 31, March 31, March 31, 2008 2007 2006 Equity Share Capital* 7,339.46 7,339.46 7,339.46 Reserves (excluding Revaluation Reserve) 15,033.2 14,431.24 1,808.46 Total Income 2,033.4 22,940.57 2,478.79 Profit/(Loss) after tax 608.7 16,807.19 561.89 Earning Per Share (EPS) (Rs.) 8.29 229.00 7.66 Net Asset Value** (NAV) (Rs. per share) 305.85 296.62 124.60 *Equity Share with face value of Rs. 100 each ** Net worth for the purpose of determination of NAV, is computed as summation of equity share capital and reserves and surplus (excluding revaluation reserve) less miscellaneous expenses not written off and accumulated losses

TIL has not become a sick company within the meaning of Sick Industrial Companies (Special Provisions) Act, 1985 and it is not under winding up. Further, TIL has confirmed that it has not been declared as a wilful defaulter by the RBI or any other governmental authority and there are no violations of securities laws committed by it in the past or are pending against it.

We confirm that the PAN of TIL, bank account number of TIL, the registration number of TIL and the address of the Registrar of Companies where TIL is registered have been submitted to the Stock Exchanges where our Equity Shares are proposed to be listed at the time of filing the Draft Letter of Offer.

Companies with which TIL has disassociated in the last three years:

Except as stated herein below, TIL has not disassociated itself with any company in the last three years:

Name of the Company: Idea Cellular Limited Date of Disassociation: June 19, 2006 Reason of Disassociation: Disinvestment of holding

Name of the Company: Tata Holset Limited Date of Disassociation: February 27, 2007 Reason of Disassociation: Disinvestment of holding

Name of the Company: Tata Securities Limited Date of Disassociation: July 30, 2007 Reason of Disassociation: Disinvestment of holding

The equity shares of TIL are not listed on any stock exchange and TIL has not made any public or rights issue in the last three years.

Interests of TIL in the Company

Except as stated in “Related Party Transactions” on page 144 of the Draft Letter of Offer, and to

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the extent of Shareholding in the Company, TIL does not have any other interest in the Company’s business.

Promise vs Performance

No public issue or rights issue has been made in the last three years.

Common Pursuit

Nil

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OUR GROUP COMPANIES

1. Tata Toyo Radiator Limited (TTRL):

TTRL was incorporated on August 18, 1997 under the Companies Act, 1956. The registered office of TTRL is at Survey No. 235/245 Village, Hinjewadi, Taluka, Mulshi, Pune 411 027.

Currently, TTRL is engaged in the business of manufacturing and dealing in all parts and components for automobiles.

Shareholding Pattern

Name of the shareholder No. of equity shares held % shareholding Tata AutoComp Systems Limited (TACO) 16,319,400 51.00% TRad Company Ltd, Japan 12,880,000 40.25% Kinsho Corporation, Japan 2,80,000 8.75% TACO jointly with Mr. Ajay Sharma 300 -- TACO jointly with Mr. Noshir Driver 100 -- TACO jointly with Mr. R.R. Shastri 100 -- TACO jointly with Mr. Raman Nanda 100 -- Total 32,000,000 100.00%

Board of Directors

The board of directors of TTRL as on date comprises:

• Mr. Devender S. Gupta (Chairman) • Mr. Hitoshi Ito • Mr. Ashutosh Tyagi • Mr. Amitabha Mukhopadhyay • Mr. Kazuhiro Okumura • Mr. Yasutomo Nakaie • Mr. Nishi Kasutoshi

Financial Performance

The brief financials of TTRL for Fiscal 2008, Fiscal 2007 and Fiscal 2006 are given below:

(Rs. in Mn except per share data) Particulars For the year ended March 31, 2008 March 31, 2007 March 31, 2006 Equity Share Capital* 320.00 320.00 320.00 Reserves (excluding revaluation reserves) 344.81 256.53 207.33 Sales 3,290.65 3,085.57 2,793.65 Total Income 3,321.91 3,097.43 2,813.83

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Particulars For the year ended March 31, 2008 March 31, 2007 March 31, 2006 Profit/(Loss) After Tax 200.99 122.18 258.79 Earning Per Share (EPS) (Rs.) 6.28 3.82 8.09 Net Asset Value**(NAV) (Rs. per share) 20.78 18.02 16.48 *Equity Share with face value of Rs. 10 each ** Net worth for the purpose of determination of NAV, is computed as summation of equity share capital and reserves and surplus (excluding revaluation reserve) less miscellaneous expenses not written off and accumulated losses

The equity shares of TTRL are not listed on any stock exchange.

TTRL has not made any public or rights issue in the last three years.

TTRL has not become a sick industrial company within the meaning of SICA and is not under winding up.

There are no defaults in meeting any statutory/bank/institution dues. No proceedings have been initiated for economic offences against TTRL.

2. Automotive Composite Systems (International) Limited (ACSI)

Automotive Composite Systems (International) Limited (ACSI) was incorporated on February 4, 2000 under the Companies Act, 1956. The registered office of ACSI is at Beck House, Damle Path, Off Law College Road, Erandawane, Pune 411 004.

Currently, ACSI is engaged in the business of dealing in moulded composite products.

Shareholding Pattern

Name of the Shareholder No. of equity shares held % shareholding Tata AutoComp Systems Limited (TACO) 9,235,734 73.99% TACO jointly with Mr. Rajiv Dhar 228 -- TACO jointly with Mr. Noshir Driver 228 -- TACO jointly with Mr. Raman Nanda 341 -- TACO jointly with Mr. Rajyadhaksha 228 -- TACO jointly with Mr. T.A. Ramkumar 341 -- IPM Inc. 3,245,468 26.00% Total 12,482,568 100.00%

Board of Directors

The board of directors of ACSI as on date comprises:

• Mr. Devender S. Gupta (Chairman) • Mr. Rameshwar S. Thakur

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• Mr. Sunil Sinha • Mr. Sunil K Saxena

Financial Performance

The brief financials of ACSI for Fiscal 2007, Fiscal 2006 and Fiscal 2005 are given below:

(Rs. in Mn except per share data) Particulars For the year ended March 31, 2007 March 31, 2006 March 31, 2005 Equity Share Capital* 54.83 54.83 54.83 Preference Share Capital 24.00 24.00 - Accumulated Losses - (2.10) (16.85) Reserves (excluding revaluation reserves) 23.56 - - Sales of Products and Services 483.63 271.87 201.60 Total Income 487.29 272.10 202.49 Profit/(Loss) After Tax 29.11 14.75 13.37 Earning Per Share (EPS) (Rs.) 4.95 2.42 2.44 Net Asset Value** (NAV) (Rs. per share) 14.30 9.62 6.93 *Equity Share with face value of Rs. 10 each ** Net worth for the purpose of determination of NAV, is computed as summation of equity share capital and reserves and surplus (excluding revaluation reserve) less miscellaneous expenses not written off and accumulated losses

The equity shares of ACSI are not listed on any stock exchange.

ACSI has not made any public or rights issue in the last three years.

ACSI has not become a sick industrial company within the meaning of SICA and is not under winding up.

3. Tata AutoComp Mobility Telematics Limited (TMTL)

Tata AutoComp Mobility Telematics Limited (TMTL) was incorporated on February 25, 2005 under the Companies Act, 1956. The registered office of TMTL is at TACO House, Damle Path, Off Law College Road, Erandwane, Pune 411 004.

Currently, TMTL is engaged in the business of manufacturing and dealing in electronic circuits, wireless and satellite communication components and vehicle tracking systems.

Shareholding Pattern

Name of the shareholder No. of equity shares held % shareholding Tata AutoComp Systems Limited (TACO) 12,999,995 99.99% TACO jointly with Mr. T.A. Ramkumar 1 -- TACO jointly with Mr. Noshir Jal Driver 1 --

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Name of the shareholder No. of equity shares held % shareholding TACO jointly with Mr. Jayesh A Parekh 1 -- TACO jointly with Mr. Ajay Sharma 1 -- TACO jointly with Mr. R.R.Shastri 1 -- Total 13,000,000 100.00%

Board of Directors

The board of directors of TMTL as on date comprises:

• Mr. Devender S. Gupta (Chairman) • Mr. Ajay Tandon • Mr. Ashutosh Tyagi

Financial Performance

The brief financials of TMTL for Fiscal 2008, Fiscal 2007 and for the period from February 25, 2005 to March 31, 2006 are given below:

(Rs. in Mn except per share data) Particulars For the period March 31, 2008 March 31, February 25, 2007 2005 to March 31, 2006 Equity Share Capital* 130.00 50.00 35.00 Share Application Money*** 6.95 - 8.72 Accumulated Losses (144.49) (85.36) (42.92) Sales of Products and Services 83.79 52.01 35.66 Total Income 84.36 52.27 35.88 Profit/(Loss) After Tax (59.13) (42.43) (42.92) Earning Per Share (EPS) (Rs.) (11.83) (8.49) (17.79) Net Asset Value** (NAV) (Rs. per share) (18.90) (7.07) (2.26) *Equity Share with face value of Rs. 10 each ** Net worth for the purpose of determination of NAV, is computed as summation of equity share capital and reserves and surplus (excluding revaluation reserve) less miscellaneous expenses not written off and accumulated losses *** Share application Money has not been considered in Net Worth for NAV calculation in the Draft Letter of Offer

The equity shares of TMTL are not listed on any stock exchange.

TMTL has not made any public or rights issue since incorporation.

TMTL has not become a sick industrial company within the meaning of SICA and is not under winding up.

4. TACO FAURECIA Design Centre Private Limited (TFDC)

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TACO FAURECIA Design Centre Private Limited (TFDC) was incorporated on May 5, 2004 under the Companies Act, 1956. The registered office of TFDC is at Sai Radhe Building, 3rd Floor, Plot No. 100 & 101. RBM, Road, Behind Hotel Le Meridien, Sangamwadi, Pune 411 001.

Currently, TFDC is engaged in the business of providing design services for interior systems components in automotive sector.

Shareholding Pattern

Name of the shareholder No. of equity shares held % shareholding Tata AutoComp Systems Limited (TACO) 2,000,000 50.00% FAURECIA Automotive Holdings 2,000,000 50.00% Total 4,000,000 100.00%

Board of Directors

The board of directors of TFDC as on date comprises:

• Mr. Devender S. Gupta (Chairman) • Mr. Hemant Mohgaonkar • Mr. Ashutosh Tyagi • Ms. Gilles Messager • Mr. Nicolas Pechnyk • Mr. Jean – Michel Renaudie

Financial Performance

The brief financials of TFDC for Fiscal 2008, Fiscal 2007 and Fiscal 2006 are given below:

(Rs. in Mn except per share data) Particulars For the year ended March 31, March 31, March 31, 2008 2007 2006 Equity Share Capital* 40.00 40.00 40.00 Reserves (excluding Revaluation Reserves) 70.56 43.92 11.61 Income from Software Design & 323.58 201.57 103.00 Development Total Income 327.96 202.05 103.99 Profit/Loss After Tax 51.17 55.71 21.44 Earning Per Share (EPS) (Rs.) 12.79 13.97 5.36 Net Asset Value** (NAV) (Rs. per share) 27.64 20.98 12.90 *Equity Share with face value of Rs. 10 each ** Net worth for the purpose of determination of NAV, is computed as summation of equity share capital and reserves and surplus (excluding revaluation reserve) less miscellaneous expenses not written off and accumulated losses

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The equity shares of TFDC are not listed on any stock exchange.

TFDC has not made any public or rights issue in the last three years.

TFDC has not become a sick industrial company within the meaning of SICA and is not under winding up.

5. TACO Hendricksons Suspensions Private Limited (THSPL)

TACO Hendricksons Suspensions Private Limited (THSPL) was incorporated on June 23, 2006 under the Companies Act, 1956. The registered office of THSPL is at TACO House, Damle Path, Off Law College Road, Erandwane, Pune 411 004.

Currently, THSPL is engaged in the business of manufacturing and dealing in commercial vehicle axles and suspension systems for vehicles

Shareholding Pattern

Name of the shareholder No. of equity shares held % shareholding Tata AutoComp Systems Limited (TACO) 6,210,000 50.00% Hendrickson Investments Asia 6,210,000 50.00% Total 12,420,000 100.00%

Board of Directors

The board of directors of THSPL as on date comprises:

• Mr. Devender S.Gupta (Chairman) • Mr. Rameshwar S. Thakur • Mr. Ashutosh Tyagi • Mr. Michael Jesse Keeler • Mr. John Kelleher • Mr. James Hodge Colley

Financial Performance

The brief financials of THSPL for Fiscal 2008 and the period from June 23, 2006 to March 31, 2007 are given below:

(Rs. in Mn except per share data) Particulars For the year Period from ended March June 23, 2006 to March 31, 2007 31, 2008 Equity Share Capital* 124.20 90.10 Accumulated Losses (55.77) (44.40) Sales 325.95 4.98

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Particulars For the year Period from ended March June 23, 2006 to March 31, 2007 31, 2008 Total Income 326.91 5.94 Profit/(Loss) After Tax (11.37) (44.40) Earning Per Share (EPS) (Rs.) (0.94) (19.57) Net Asset Value** (NAV) (Rs. per share) 5.51 5.07 *Equity Share with face value of Rs. 10 each ** Net worth for the purpose of determination of NAV, is computed as summation of equity share capital and reserves and surplus (excluding revaluation reserve) less miscellaneous expenses not written off and accumulated losses

The equity shares of THSPL are not listed on any stock exchange.

THSPL has not made any public or rights issue since incorporation.

THSPL has not become a sick industrial company within the meaning of SICA and is not under winding up.

6. Tata AutoComp GY Batteries Private Limited (TGY BATTERIES)

Tata AutoComp GY Batteries Private Limited (TGY BATTERIES) was incorporated on October 10, 2005 under the Companies Act, 1956. The registered office of TGY BATTERIES is at TACO House, Damle Path, Off Law College Road, Erandwane, Pune 411 004.

Currently, TGY BATTERIES is engaged in the business of manufacturing and dealing in batteries for vehicles.

Shareholding Pattern

Name of the Shareholder No. of equity shares held % shareholding Tata AutoComp Systems Limited (TACO) 25,250,000 50.00% GS Yuasa International Ltd. 25,250,000 50.00% Total 50,500,000 100.00%

Board of Directors

The board of directors of TGY BATTERIES as on date comprises:

• Mr. Devender S. Gupta (Chairman) • Mr. Rameshwar S. Thakur • Mr. Ashutosh Tyagi • Mr. Hitoshi Ito • Mr. Koichi Shiina • Mr. Nakano Hiroharu • Mr. Kato Taiichiro M.

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• Mr. Noboru Kitamura

Financial Performance

The brief financials of TGY BATTERIES for Fiscal 2008, Fiscal 2007 and the period from October 10, 2005 to March 31, 2006 are given below: (Rs. in Mn except per share data) Particulars For the year ended Period from March 31, March 31, October 10, 2005 2008 2007 to Mar 31, 2006 Equity Share Capital* 505.00 425.00 300.00 Preference Share Capital 240.00 - - Accumulated Losses (492.61) (153.62) (14.88) Sales 523.77 32.90 - Total Income 549.79 35.82 - Profit/(Loss) After Tax (338.98) (138.74) (14.88) Earning Per Share (EPS) (Rs.) (7.56) (4.61) (41.72) Net Asset Value** (NAV) (Rs. per 0.25 6.39 9.50 share) *Equity Share with face value of Rs. 10 each ** Net worth for the purpose of determination of NAV, is computed as summation of equity share capital and reserves and surplus (excluding revaluation reserve) less miscellaneous expenses not written off and accumulated losses

The equity shares of TGY BATTERIES are not listed on any stock exchange.

TGY BATTERIES has not made any public or rights issue since incorporation.

TGY BATTERIES has not become a sick industrial company within the meaning of SICA and is not under winding up.

7. Tata Visteon Automotive Private Limited (TVAPL)

Tata Visteon Automotive Private Limited (TVAPL) was incorporated on June 21, 2005 under the Companies Act, 1956. The registered office of TVAPL is at Beck House, Damle Path, Off Law College Road, Erandwane, Pune 411 004.

Currently, TVAPL is engaged in the business of designing, developing, manufacturing, selling of powertrain products and lighting products.

Shareholding Pattern

Name of the shareholder Total no. of % shareholding equity shares held Tata AutoComp Systems Limited (TACO) 25,505,000 50.00%

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Name of the shareholder Total no. of % shareholding equity shares held Visteon International Holding Inc. USA 25,505,000 50.00% Total 51,010,000 100.00%

Board of Directors

The Board of Directors of TVAPL as on date comprises:

• Mr. Devender S. Gupta (Chairman) • Mr. Sunil Sinha • Mr. Ajay Tandon • Mr. Robert Pallash • Mr. Daniel Linder • Mr. Alastair Parke

Financial Performance

The brief financials of TVAPL for Fiscal 2008, Fiscal 2007 and for the period June 21, 2005 to March 31, 2006 are given below:

(Rs. in Mn except per share data) Particulars For the year ended For the period March 31, March 31, June 21, 2005 to 2008 2007 March 31, 2006 Equity Share Capital* 510.10 230.10 0.10 Share Application Money - - 115.00 Accumulated Losses (369.22) (220.60) (82.04) Sales 90.20 0.28 - Total Income 98.13 4.41 4.12 Profit/(Loss) After Tax (148.62) (138.56) (82.04) Earning Per Share (EPS) (Rs.) (3.83) (18.77) (8,203.63) Net Asset Value** (NAV) (Rs. per 2.76 0.41 (8,194.00) share) *Equity Share with face value of Rs. 10 each ** Net worth for the purpose of determination of NAV, is computed as summation of equity share capital and reserves and surplus (excluding revaluation reserve) less miscellaneous expenses not written off and accumulated losses

The equity shares of TVAPL are not listed on any stock exchange.

TVAPL has not made any public or rights issue since incorporation.

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TVAPL has not become a sick industrial company within the meaning of SICA and is not under winding up.

8. TACO Visteon Engineering Private Limited (TVEPL)

TACO Visteon Engineering Private Limited (TVEPL) was incorporated on June 21, 2005 under the Companies Act, 1956. The registered office of TVEPL is at A/205-206, 2nd Floor, ICC Trade Towers, 403/A Senapati, Bapat Road, Pune 400 016.

Currently, TVEPL is engaged in the business of Design and development of automobile component.

Shareholding Pattern

Name of the shareholder No. of equity shares held % shareholding Tata AutoComp Systems Limited (TACO) 3,130,000 50.00% Visteon International Holdings, Inc. 3,130,000 50.00% Total 6,260,000 100.00%

Board of Directors

The board of directors of TVEPL as on date comprises:

• Mr. Devender S.Gupta (Chairman) • Mr. Hemant Mohgaonkar • Mr. Sunil Sinha • Mr. Robert Pallash • Mr. Daniel Linder • Mr. Alastair Parke

Financial Performance

The brief financials of TVEPL for Fiscal 2008, Fiscal 2007 and for the period June 21, 2005 to March 31, 2006 are given below: (Rs. in Mn except per share data) Particulars For the year ended For the period March 31, March 31, June 21, 2005 2008 2007 to March 31, 2006 Equity Share Capital* 62.60 62.60 62.60 Reserves (excluding revaluation 3.75 - - reserve) Accumulated Losses - (13.68) (36.67) Income from Engineering Design 289.51 224.68 3.25 Services

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Particulars For the year ended For the period March 31, March 31, June 21, 2005 2008 2007 to March 31, 2006 Total Income 297.47 226.34 4.12 Profit /(Loss) After Tax 17.43 22.99 (36.67) Earning Per Share (EPS) (Rs.) 2.78 3.67 (14.39) Net Asset Value** (NAV) (Rs. per 10.60 7.81 4.14 share) *Equity Share with face value of Rs. 10 each ** Net worth for the purpose of determination of NAV, is computed as summation of equity share capital and reserves and surplus (excluding revaluation reserve) less miscellaneous expenses not written off and accumulated losses

The equity shares of TVEPL are not listed on any stock exchange.

TVEPL has not made any public or rights issue since incorporation.

TVEPL has not become a sick industrial company within the meaning of SICA and is not under winding up.

9. Tata Nifco Fasteners Limited (TNFL) (under liquidation)

Tata Nifco Fasteners Limited (TNFL) (under liquidation) was incorporated on November 28, 1997 under the Companies Act, 1956. The registered office of TNFL is at Beck House, 1st Floor, Damle Path, Off Law College Road, Erandawane, Pune 411 004.

TNFL was engaged in the business of manufacturing all types of fasteners for automobiles.

Shareholding Pattern

Name of the shareholder No. of equity shares held % shareholding Tata AutoComp Systems Limited (TACO) 1,000,000 50.00% NIFCO Inc. 1,000,000 50.00% Total 2,000,000 100.00%

Board of Directors

Pursuant to the Resolution dated October 26, 2006 passed by the members of TNFL, TNFL has decided to voluntarily wind up under the provisions of the Act on account of suspension of the business since last several years. Accordingly, TNFL has discharged all its directors on its board. TNFL has appointed Mr. Mahesh Athavale as an official liquidator of the Company.

Financial Performance

The brief financials of TNFL for Fiscal 2007, Fiscal 2006 and Fiscal 2005 are given below:

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(Rs. in Mn except per share data) Particulars For the year ended March 31, 2007 March 31, 2006 March 31, 2005 Equity Share Capital* 20.00 20.00 20.00 Accumulated Losses (9.53) (9.69) (10.22) Interest Income 0.42 0.57 0.52 Total Income 0.42 0.57 0.52 Profit / (Loss) After Tax 0.16 0.53 0.11 Earning Per Share (EPS) (Rs.) 0.08 0.26 0.06 Net Asset Value** (NAV) (Rs. per share) 5.24 5.16 4.89 *Equity Share with face value of Rs. 10 each ** Net worth for the purpose of determination of NAV, is computed as summation of equity share capital and reserves and surplus (excluding revaluation reserve) less miscellaneous expenses not written off and accumulated losses

The equity shares of TNFL are not listed on stock exchange.

TNFL has not made any public or rights issue in the last three years.

10. TACO Sasken Automotive Electronics Private Limited (TSAE)

TACO Sasken Automotive Electronics Private Limited (TSAE) was incorporated on January 24, 2007 under the Companies Act, 1956. The registered office of TSAE is at TACO House, V.G. Damle Path, Off Law College Road, Erandwane, Pune 411 004.

Currently, TSAE is engaged in the business of dealing in electronic products for automotive applications.

Shareholding Pattern

Name of the shareholder No. of equity shares held % shareholding Tata AutoComp Systems Limited (TACO) 4,422,126 50.00% Sasken Communication Technologies Ltd. 4,422,125 50.00% Total 8,844,251 100.00%

Board of Directors

The board of directors of TSAE as on date comprises:

• Mr. Devender S. Gupta (Chairman) • Mr. Madhukar Dev • Mr. Ajay Tandon • Mr. Rajiv C. Modi • Mr. G. Venkatesh • Ms. Neeta Revankar

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Financial Performance

The brief financials of TSAE for Fiscal 2008 and for the period from January 24, 2006 to March 31, 2007 is given below:

(Rs. in Mn except per share data) Particulars For the year ended Period from March 31, 2008 January 24, 2006 to March 31, 2007 Equity Share Capital* 74.44 3.44 Accumulated Losses (62.21) (11.71) Sales 1.12 - Total Income 1.12 - Profit / (Loss) After Tax (50.50) (11.71) Earning Per Share (EPS) (Rs.) (15.97) (34.00) Net Asset Value** (NAV) (Rs. per share) (3.22) (24.32) *Equity Share with face value of Rs. 10 each ** Net worth for the purpose of determination of NAV, is computed as summation of equity share capital and reserves and surplus (excluding revaluation reserve) less miscellaneous expenses not written off and accumulated losses

The equity shares of TSAE are not listed on any stock exchange.

TSAE has not made any public or rights issue since incorporation.

TSAE has not become a sick industrial company within the meaning of SICA and is not under winding up.

11. Tata Ficosa Automotive Systems Limited (TFASL)

Tata Ficosa Automotive Systems Limited (TFASL) was incorporated on January 14, 1998 under the Companies Act, 1956. The registered office of TFASL is at No. 235/245, Hinjewadi, Tal. Mulshi, Pune 411 027.

Currently, TFASL is engaged in the business of manufacturing parts of cables and transmission systems.

Shareholding Pattern

Name of the shareholder No. of equity shares held % shareholding Tata AutoComp Systems Limited (TACO) 10,699,400 50.00% Ficosa International 10,700,000 50.00% TACO jointly with Mr. Ajay Sharma 300 -- TACO jointly with Mr. Noshir Driver 100 -- TACO jointly with Mr. R.R. Shastri 100 -- TACO jointly with Mr. T.A. Ramkumar 50 --

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Name of the shareholder No. of equity shares held % shareholding TACO jointly with Mr. Raman Nanda 50 -- Total 21,400,000 100.00%

Board of Directors

The board of directors of TFASL as on date comprises:

• Mr. Devender S. Gupta (Chairman) • Mr. Ajay Tandon • Mr. Piyush Nagar • Mr. Pujol Javier Artigas • Mr. Serra Jose Maria • Mr. Tarrago Jose Maria

Financial Performance

The brief financials of TFSAL for Fiscal 2008, Fiscal 2007 and Fiscal 2006 are given below:

(Rs. in Mn except per share data) For the year ended Particulars March 31, March 31, March 31,

2008 2007 2006 Equity Share Capital* 214.00 94.00 94.00 Reserves (excluding revaluation reserves) - - 20.84 Accumulated Losses (129.09) (7.94) - Sales of products, Income from services 766.85 702.12 554.22 and Trading Sales Total Income 782.95 724.95 591.33 Profit / (Loss) After Tax (121.15) (28.78) 13.31 Earning Per Share (EPS) (Rs.) (12.41) (3.06) 1.42 Net Asset Value** (NAV) (Rs. per share) 3.97 9.16 12.22 *Equity Share with face value of Rs. 10 each ** Net worth for the purpose of determination of NAV, is computed as summation of equity share capital and reserves and surplus (excluding revaluation reserve) less miscellaneous expenses not written off and accumulated losses

The equity shares of TFASL are not listed on any stock exchange.

TFASL has not made any public or rights issue in the last three years.

TFASL has not become a sick industrial company within the meaning of SICA and is not under winding up.

12. Tata Johnson Controls Automotive Limited (TJCL)

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Tata Johnson Controls Automotive Limited (TJCL) was incorporated on January 5, 1996 under the Companies Act, 1956. The registered office of TJCL is at Plot No. 1, S No. 235/245, Hinjewadi, Tal. Mulshi, Pune 411 027.

Currently, TJCL is engaged in the business of manufacturing and dealing in components for automobiles.

Shareholding Pattern

Name of the shareholder No. of equity shares held % shareholding Tata AutoComp Systems Limited (TACO) 6,349,700 50.00% TACO jointly with Mr. Dilip S. Pendse 150 -- TACO jointly with Mr. Devender S. Gupta 50 -- TACO jointly with Mr. Noshir Driver 50 -- TACO jointly with Mr. T.A. Ramkumar 25 -- TACO jointly with Mr. Ajay Sharma 25 -- Johnson Controls International BV, Netherlands 6,350,000 50.00% Total 12,700,000 100.00%

Board of Directors

The board of directors of TJCL as on date comprises:

• Mr. Devender S. Gupta (Chairman) • Mr. Ajay Tandon • Mr. Milton Roye • Mr. Hemant Mohgaonkar • Mr. R. R.Bhinge • Mr. Derrick Williams • Mr. Van Nguyen • Mr. Charles Baker • Mr. Mark Stevens • Mr. Matthais Treier

Financial Performance

The brief financials of TJCL for Fiscal 2008, Fiscal 2007 and Fiscal 2006 are given below:

(Rs. in Mn except per share data) Particulars For the year ended March 31, 2008 March 31, 2007 March 31, 2006 Equity Share Capital* 127.00 127.00 127.00 Reserves (excluding revaluation reserves) 139.66 73.40 50.37 Sales and Income from Services 4,347.62 4,073.21 3,194.15

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For the year ended Total Income 4,419.94 4,105.29 3,231.18 Profit / (Loss) After Tax 207.05 140.39 85.32 Earning Per Share (EPS) (Rs.) 15.75 11.05 6.72 Net Asset Value** (NAV) (Rs. per share) 21.00 15.78 13.97 *Equity Share with face value of Rs. 10 each ** Net worth for the purpose of determination of NAV, is computed as summation of equity share capital and reserves and surplus (excluding revaluation reserve) less miscellaneous expenses not written off and accumulated losses

The equity shares of TJCL are not listed on any stock exchange.

TJCL has not made any public or rights issue in the last three years.

TJCL has not become a sick industrial company within the meaning of SICA and is not under winding up.

13. Tata Yazaki Autocomp Limited (TYAL)

Tata Yazaki Autocomp Limited (TYAL) was incorporated on October 6, 1997 under the Companies Act, 1956. The registered office of TYAL is at Gate No. 93, Survey No. 166, High Cliff, Industrial Estate, Wadholi- Rahu Road, Kesnand, Pune 412 207.

Currently, TYAL is engaged in the business of manufacturing and dealing in all types of automotive wire harnesses and components.

Shareholding Pattern

Name of the Shareholder No. of equity shares held % shareholding Tata AutoComp Systems Limited (TACO) 35,099,500 50.00% Yazaki Corporation 35,100,000 50.00% TACO jointly with Mr. Ajay Sharma 150 -- TACO jointly with Mr. T.A. Ramkumar 50 -- TACO jointly with Mr. RR Shastri 100 -- TACO jointly with Mr. Noshir Driver 50 -- TACO jointly with Mr. Raman Nanda 150 -- Total 70,200,000 100.00%

Board of Directors

The board of directors of TYAL as on date comprises:

• Mr. Gupta D. S. (Chairman) • Mr. Ito Hitoshi • Mr. Shastri R.R.

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• Mr. Masashi Yamashita • Mr. Kazuhiko Fukukawa • Mr. Hirosuke Matsumoto • Mr. Takashi Goukon

Financial Performance

The brief financials of TYAL for Fiscal 2008, Fiscal 2007 and Fiscal 2006 are given below:

(Rs. in Mn except per share data) Particulars For the year ended March 31, 2008 March 31, 2007 March 31, 2006 Equity Share Capital* 630.00 630.00 430.00 Preference Share Capital 23.00 23.00 23.00 Accumulated Losses (487.03) (429.42) (402.78) Sales 2,539.90 2,418.05 1,881.01 Total Income 2,564.22 2,448.00 1,892.55 Profit/(Loss) After Tax (57.61) (26.64) 30.84 Earning Per Share (EPS) (Rs.) (0.91) (0.46) 0.72 Net Asset Value** (NAV) (Rs. per share) 2.27 3.18 0.63 *Equity Share with face value of Rs. 10 each ** Net worth for the purpose of determination of NAV, is computed as summation of equity share capital and reserves and surplus (excluding revaluation reserve) less miscellaneous expenses not written off and accumulated losses

The equity shares of TYAL are not listed on any stock exchange.

TYAL has not made any public or rights issue in the last three years.

TYAL informed BIFR on March 18, 2008 that TYAL became potentially sick under the provisions of section 23 of SICA.

14. Technical Stampings Automotive Limited (TSAL)

Technical Stampings Automotive Limited (TSAL) was incorporated on July 1, 2001 under the Companies Act, 1956. The registered office of TSAL is at No. G.16 & 18, SIPCOT , Industrial Park, Irrungattukottai, Sriperumbudur Taluk, Kanchipuram, D.T, Tamil Nadu 602 105.

Currently, TSAL is engaged in the business of manufacturing and supplying of body panels and dies, jigs and moulds.

Shareholding Pattern

Name of the shareholder No. of equity shares held % Shareholding

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Name of the shareholder No. of equity shares held % Shareholding Tata AutoComp Systems Limited (TACO) 6,478,800 50.00% Sungwoo Hitech Company Ltd. 5,831,100 45.00% F.S. Tech 647,900 5.00% TACO jointly with Mr. T.A.Ramkumar 50 -- TACO jointly with Mr. Ajay Sharma 50 -- TACO jointly with Mr. R R Shastri 50 -- TACO jointly with Mr. Raman Nanda 50 -- Total 12,958,000 100.00%

Board of Directors

The board of directors of TSAL as on date comprises:

• Mr. Devender S. Gupta (Chairman) • Mr. Rameshwar S. Thakur • Mr. R.R. Shastri • Mr. M. K. Kim • Mr. Lee Myung Keun • Mr. H.K. Park

Financial Performance

The brief financials of TSAL for Fiscal 2008, Fiscal 2007 and Fiscal 2006 are given below:

(Rs. in Mn except per share data) Particulars For the year ended March 31, 2008 March 31, 2007 March 31, 2006 Equity Share Capital* 129.58 129.58 129.58 Reserves (excluding Revaluation Reserves) 453.80 378.50 282.91 Sales 4,661.48 2,532.61 1,701.89 Total Income 4,740.41 2,554.05 1,709.89 Profit After Tax (PAT) 166.27 184.63 201.12 Earning Per Share (EPS) (Rs.) 12.83 14.25 15.52 Net Asset Value** (NAV) (Rs. per share) 45.02 39.20 31.83 *Equity Share with face value of Rs. 10 each ** Net worth for the purpose of determination of NAV, is computed as summation of equity share capital and reserves and surplus (excluding revaluation reserve) less miscellaneous expenses not written off and accumulated losses

The equity shares of TSAL are not listed on any stock exchange

TSAL has not made any public or rights issue in the last three years

TSAL has not become a sick industrial company within the meaning of SICA and is not under winding up.

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15. TC Springs Limited (TCSL)

TC Springs Limited (TCSL) was incorporated on March 9, 1999 under the Companies Act, 1956. The registered office of TCSL is at Survey No. 1072, Post-Pirangut, Taluka Mulshi, Dist. Pune 412 111.

Currently, TCSL is engaged in the business of dealing in all types of components used in automobiles.

Shareholding Pattern

Name of the shareholder No. of equity shares held % shareholding Tata AutoComp Systems Limited (TACO) 19,999,400 100.00% TACO jointly with Mr. Raman Nanda 50 -- TACO jointly with Mr. Anil Malhotra 150 -- TACO jointly with Mr. RR Shastri 150 -- TACO jointly with Mr. Ajay Sharma 100 -- TACO jointly with Mr. Noshir Driver 50 -- TACO jointly with Mr. T.A. Ramkumar 100 -- Total 20,000,000 100.00%

Board of Directors

The board of directors of TCSL as on date comprises:

• Mr. Devender S.Gupta (Chairman) • Mr. Rameshwar.S. Thakur • Mr. R.R. Shastri • Mr. Amitabha Mukhopadhyay • Mr. Vijay Paluskar

Financial Performance

The brief financials of TCSL for Fiscal 2008, Fiscal 2007 and Fiscal 2006 are given below:

(Rs. in Mn except per share data) Particulars For the year ended March 31, 2008 March 31, 2007 March 31, 2006 Equity Share Capital* 200.00 200.00 200.00 Reserves (excluding Revaluation Reserves) 25.26 20.50 8.41 Sales 484.14 477.46 439.53 Total Income 495.86 488.43 454.67 Profit / (Loss) after Tax 4.92 12.09 6.90 Earning Per Share (EPS) (Rs.) 0.25 0.60 0.35

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Particulars For the year ended March 31, 2008 March 31, 2007 March 31, 2006 Net Asset Value** (NAV) (Rs. per share) 11.26 11.03 10.42 *Equity Share with face value of Rs. 10 each ** Net worth for the purpose of determination of NAV, is computed as summation of equity share capital and reserves and surplus (excluding revaluation reserve) less miscellaneous expenses not written off and accumulated losses

The equity shares of TCSL are not listed on any stock exchange

TCSL has not made any public or rights issue in the last three years.

TCSL has not become a sick industrial company within the meaning of SICA and is not under winding up.

16. Tata Advanced Systems Limited (TASL)

TASL was incorporated on September 19, 2006 under the Companies Act, 1956 and issued the Certificate for Commencement of Business on September 21, 2006. The registered office of TASL is at Bombay House, 1st Floor, 24 Homi Mody Street, Mumbai 400 001.

Currently, TASL is engaged in the business of developing and deploying advanced defence and other technologies.

Shareholding Pattern

The paid up equity share capital is Rs. 500,000 comprising of 50,000 equity shares of Rs. 10 each. The entire paid up equity share capital of TASL is held by Tata Industries Limited.

Board of Directors

The board of directors of TASL as on date comprises:

• Mr. Sukaran Singh • Mr. Bharat Vasani • Mr. R. R. Shastri

Financial Performance

The brief financials of TASL for the period from September 19, 2006 to March 31, 2007 are given below:

(Rs. in Mn except per share data) Particulars Period from September 19, 2006 to

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March 31, 2007 Equity Share Capital* March 31, 2007 0.50 Reserves (excluding Revaluation Reserves) -- Salesand Income from Services -- Total Income -- Profit / (Loss) after Tax -- Miscellaneous Expenses to the extent not written off 0.07 Earning Per Share (EPS) (Rs.) -- Net Asset Value** (NAV) (Rs. per Share) 8.61 *Equity Share with face value of Rs. 10 each ** Net worth for the purpose of determination of NAV, is computed as summation of equity share capital and reserves and surplus (excluding revaluation reserve) less miscellaneous expenses not written off and accumulated losses

The equity shares of TASL are not listed on any stock exchange.

TASL has not made any public or rights issue since incorporation.

TASL has not become a sick industrial company within the meaning of SICA and is not under winding up.

17. Tata Industrial Services Limited (TISL):

TISL was incorporated on August 13, 2007 under the Companies Act, 1956 and issued the Certificate for Commencement of Business on September 13, 2007. The registered office of TISL is at Bombay House, 1st Floor, 24 Homi Mody Street, Mumbai 400 001.

Currently, TISL is engaged in the business of providing services in relation to the fulfillment of Offset obligations.

Shareholding Pattern

The paid up equity share capital is Rs. 500,000 comprising of 50,000 equity shares of Rs. 10 each. The entire paid up equity share capital of TASL is held by Tata Industries Limited.

Board of Directors

The board of directors of TISL as on date comprises:

• Ms. Uma Pillai, Managing Director • Mr. K. A. Chaukar • Mr. Bharat Vasani • Mr. R. R. Shastri

Financial Performance

TISL was incorporated in August 2007 and has no audited financials ready as on date.

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The equity shares of TISL are not listed on any stock exchange.

TISL has not made any public or rights issue since incorporation.

TISL has not become a sick industrial company within the meaning of SICA and is not under winding up.

18. Strategic Equipment Supplies Limited (SESL):

SESL was incorporated on July 20, 2006 under the Companies Act, 1956. The registered office of TASL is at Bombay House, 1st Floor, 24 Homi Mody Street, Mumbai 400 001.

SESL was promoted to source/supply equipment of strategic importance to government and other authorities.

Shareholding Pattern

The paid up equity share capital is Rs. 500,000 comprising of 50,000 equity shares of Rs. 10 each. The entire paid up equity share capital of SESL is held by Tata Industries Limited.

Board of Directors

The board of directors of SESL as on date comprises:

• Mr. Sukaran Singh • Mr. R. R. Shastri • Mr. N.J. Driver

Financial Performance

The brief financials of SESL for the period from July 20, 2006 to March 31, 2007 are given below:

(Rs. in Mn except per share data) Particulars Period from July 20, 2006 to March 31, 2007 Equity Share Capital* 0.50 Reserves (excluding Revaluation Reserves) -- Sales and Income from Services -- Total Income -- Profit / (Loss) after Tax -- Miscellaneous Expenses to the extent not written off 0.07 Earning Per Share (EPS) (Rs.) -- Net Asset Value** (NAV) (Rs. per share) 8.67 *Equity Share with face value of Rs. 10 each

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** Net worth for the purpose of determination of NAV, is computed as summation of equity share capital and reserves and surplus (excluding revaluation reserve) less miscellaneous expenses not written off and accumulated losses

The equity shares of SESL are not listed on any stock exchange.

SESL has not made any public or rights issue since incorporation.

SESL has not become a sick industrial company within the meaning of SICA and is not under winding up.

19. Tata Advanced Materials Limited (TAML):

TAML was incorporated on November 10, 1989 under the Companies Act, 1956. The registered office of TAML is at No.10, Jigani Industrial Area, Jigani, Bangalore – 562106

Currently, TAML is engaged in the business of products made out of composites viz.

• Personnel armour products like bullet proof jackets, bullet proof helmets and missile containers • Vehicle armour kits • Aerospace products like satellite components, helicopter components and aerospace components

Shareholding Pattern

Name of the shareholder No of equity shares held % shareholding Tata Industries Limited 1,091,180 93.66% Tata Investment Corporation Ltd 75 0.01% Others 73,745 6.33% Total 1,165,000 100.00%

Board of Directors

The board of directors of TAML as on date comprises:

• Mr. Syamal Gupta (Chairman) • Mr. A K Vora (Vice Chairman) • Mr. B B Dubash • Mr. K A Chaukar • Mr. Sujit Gupta • Dr. C.G. Krishnadas Nair • Dr. D. Bhattacharjee • Mr. Ashutosh Tyagi • Mr .B. K. R. Rao • Mr. A. P. Arya

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Financial Performance

The brief financials of TAML for Fiscal 2008, Fiscal 2007 and Fiscal 2006 are given below:

(Rs. in Mn except per share data) Particulars For the year ended March 31, 2008 March 31, 2007 March 31, 2006 Equity Share Capital* 11.65 11.65 11.65 Reserves (excluding Revaluation 14.98 76.21 102.50 Reserves) Sales 249.75 708.79 1,611.01 Total Income 259.71 723.68 1,642.51 Profit / (Loss) after Tax (60.66) (26.29) 83.60 Earning Per Share (EPS) (Rs.) (52.07) (22.57) 71.76 Net Asset Value** (NAV) (Rs. per 22.86 70.49 93.06 share) *Equity Share with face value of Rs. 10 each ** Net worth for the purpose of determination of NAV, is computed as summation of equity share capital and reserves and surplus (excluding revaluation reserve) less miscellaneous expenses not written off and accumulated losses

The equity shares of TAML are not listed on any stock exchange.

TAML has not made any public or rights issue in the last three years.

TAML has not become a sick industrial company within the meaning of SICA and is not under winding up.

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RELATED PARTY TRANSACTIONS

Please refer to Annexure F of the “Auditors’ Report” beginning on page 146 of the Draft Letter of Offer.

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DIVIDEND POLICY

The Company has been a dividend paying company and has paid dividends in each of the last three years. The following are the dividend pay outs in the last three years by the Company:

Fiscal Rate of Dividend per Equity Share of Rs. 10 each 2006 12 % 2007 15 % 2008 15 %

The Preference Shareholders of the Company have been paid a dividend of 12% p.a. for each of the above three years.

The dividends paid in the past are not necessarily indicative of our dividend policy or dividends, if any, in the future. The declaration and payment of dividend will be recommended by our Board of Directors and approved by our shareholders at their discretion and will depend on a number of factors, including but not limited to, our profits, capital requirements and overall financial conditions. The Board may also from time to time pay interim dividend.

Pursuant to the terms of some of our existing loan agreements, we cannot declare or pay any dividend to our Shareholders during any financial year if we are in default of payment.

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SECTION V: FINANCIAL STATEMENTS

AUDITORS’ REPORT

The Board of Directors Automotive Stampings and Assemblies Limited G-71/2, MIDC Industrial Area, Pune 411 026, Maharashtra, India

Dear Sirs,

1. We have examined the attached Financial Information of Automotive Stampings and Assemblies Limited (hereinafter referred to as ‘the Company’) annexed to this report for each of the financial years ended on March 31, 2008, 2007, 2006, 2005 and 2004 prepared by the Company and as approved by the Board of Directors of the Company, prepared in terms of the requirements of Paragraph B, Part II of Schedule II of the Companies Act, 1956 (“the Act”) and the Securities and Exchange Board of India (Disclosure and Investor Protection) Guidelines, 2000 as amended to date (“SEBI Guidelines”) and in terms of our engagement agreed upon with you in accordance with our engagement letter dated April 14, 2008, in connection with the proposed Right issue of Equity shares of the Company.

2. These Financial Information have been prepared by the Management from the Financial Statements for each of the financial years ended on March 31, 2008, 2007, 2006, 2005 and 2004.

The restated Financial Information has been made after incorporating:

a) Adjustment for the changes in accounting policies retrospectively in respective financial years to reflect the same accounting treatment as per changed accounting policy for all the reporting periods.

b) Adjustments for the material amounts in the respective financial years to which they relate.

c) And there are no extra ordinary items that need to be disclosed separately in the accounts and qualification requiring adjustments.

3. In accordance with the requirements of Paragraph B of Part II of Schedule II of the Act, the SEBI Guidelines and terms of our engagement agreed with you, we further report that:

a) The Restated Summary Statement of Assets and Liabilities of the Company as at March 31, 2008, 2007, 2006, 2005 and 2004 examined by us, as set out in Annexure A to this report are after making adjustments and regrouping as in our opinion were appropriate

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and more fully described in Significant Accounting Policies and Notes and Changes in Significant Accounting Policies given in Annexure D (Refer Annexures).

(b) The Restated Summary Statement of Profit or Loss of the Company for each of the financial years ended on March 31, 2008, 2007, 2006, 2005 and 2004 examined by us, as set out in Annexure B to this report are after making adjustments and regrouping as in our opinion were appropriate and more fully described in Significant Accounting Policies, Notes and Changes in Significant Accounting Policies given in Annexure D (Refer Annexures).

(c) The Restated Summary Statement of Cash Flows of the company for each of the financial years ended on March 31, 2008, 2007, 2006, 2005 and 2004 examined by us as set out in Annexure C to this report, in our opinion, were appropriate and more fully described in Significant Accounting Policies, Notes and Changes in Significant Accounting Policies given in Annexure D (Refer Annexures).

(d) Based on above, we are of the opinion that the restated Financial Information have been made after incorporating:

(i) Adjustments for the changes in accounting policies retrospectively in respective financial years to reflect the same accounting treatment as per changed accounting policy for all the reporting periods.

(ii) Adjustments for the material amounts in the respective financial years to which they relate.

(iii) Further, there are no extra-ordinary items that need to be disclosed separately in the accounts and qualification requiring adjustments.

(e) We have also examined the following other Financial Information, setout in Annexures prepared by the Management and approved by the Board of Directors relating to the Company for each of the financial years ended on March 31, 2008, 2007, 2006, 2005 and 2004.

(i) Statement of Significant accounting policies followed by the Company and Changes in accounting policies included in Annexure D

(ii) Statement of Dividends paid/ proposed included in Annexure E

(iii) Statement of Related Party Transactions included in Annexure F

(iv) Statement of Other Income included in Annexure G

(v) Statement of Accounting Ratios included in Annexure H

(vi) Statement of Secured Loans included in Annexure I

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(vii) Statement of Unsecured Loans included in Annexure J

(viii) Statement of Sundry Debtors included in Annexure K

(ix) Statement of Loans and Advances included in Annexure L

(x) Statement of Capitalisation as at March 31, 2008 included in Annexure M

(xi) Statement of Tax shelter included in Annexure N

(xii) Statement of Segment Reporting included in Annexure O

In our opinion, the Financial Information contained in Annexure A to O of this report read along with the Significant Accounting Policies, Changes in Significant Accounting Policies and Notes (Refer Annexures) prepared after making adjustments and regrouping as considered appropriate have been prepared in accordance with Paragraph B of Part II of Schedule II of the Act and the SEBI Guidelines.

4. Our report is intended solely for use of the Management and for inclusion in the offer document in connection with the proposed Right Issue of Equity shares of the Company and is not to be used, referred to or distributed for any other purpose without our prior written consent.

Jeetendra Mirchandani Partner Membership No. – F 48125 For and on behalf of Place: Pune Price Waterhouse Date: April 28, 2008 Chartered Accountants

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Annexure A Statement of Assets and Liabilities of Automotive Stampings and Assemblies Limited, as Restated

(Currency: Indian Rupee in thousands) S AS AT MARCH 31, l. Reference Particulars to N Annexures 2008 2007 2006 2005 2004 o. A FIXED ASSETS Gross Block 1,436,147 1,222,302 1,017,971 980,919 835,184 Less: Accumulated Depreciation 744,976 638,819 534,591 440,189 351,258 Net Block 691,171 583,483 483,380 540,730 483,926 Capital Work in Progress 394,342 71,676 149,655 108,375 44,260

(including capital advances) Total 1,085,513655,159 633,035 649,105528,186

CURRENT ASSETS, LOANS B AND ADVANCES Inventories 313,151 351,920 316,702 344,853 209,610 Sundry Debtors K 205,638 254,477 184,549 146,502 120,427 Cash and Bank Balances 20,237 7,478 102,713 11,479 5,700 Loans and Advances L 148,733 119,559 84,817 98,927 24,617 Total 687,759733,434 688,781 601,761360,354

LIABILITIES AND C PROVISIONS Secured Loans I 605,010 273,483 185,000 200,000 79,521 Unsecured Loans J 18,594 22,064 180,121 174,376 85,350 Current Liabilities 552,759 480,069 403,117 326,182 218,199 Provisions 45,904 65,958 48,486 47,902 36,256 Deferred Tax Liability (Net) 34,142 43,702 46,287 53,427 32,283 Total 1,256,409885,276 863,011 801,887451,609

D NET WORTH (A+B-C) 516,863 503,317 458,805 448,979 436,931

NET WORTH E REPRESENTED BY Share Capital 191,985 191,985 221,985 221,985 221,985 Reserves and Surplus 324,878 311,332 236,820 226,994 214,946 Net Worth 516,863 503,317 458,805 448,979 436,931 Statement of Significant Accounting Policies and Notes F D and Changes in Significant Accounting Policies

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The Annexures C to O form an integral part of the restated accounts. For and on behalf of the Board

Chairman Director

Chief Financial Officer Director Director Place: Mumbai Date: April 28, 2008

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Annexure B Statement of Profit and Loss of Automotive Stampings and Assemblies Limited, as Restated

(Currency: Indian Rupee in thousands) FOR THE YEAR ENDED MARCH 31, Particulars Reference to Annexures 2008 2007 2006 2005 2004

INCOME Net Sales of products 3,009,871 3,131,849 2,767,967 2,498,843 1,764,019 manufactured Other income G 15,018 115,965 18,218 6,347 40,638 TOTAL INCOME 3,024,889 3,247,814 2,786,185 2,505,190 1,804,657

Employees Manufacturing, Selling and Other 374,468 380,758 399,333 400,645 266,458

Expenses Interest and Finance Charges 23,793 23,359 19,570 13,927 19,701 Depreciation & Amortisation 115,354 108,182 98,277 91,114 74,667

TOTAL EXPENDITURE 2,959,063 3,078,902 2,715,338 2,440,002 1,672,949 PROFIT BEFORE TAX 65,826 168,912 70,847 65,188 131,708

PROVISION FOR TAXATION: Current tax (including wealth tax) 31,066 61,600 28,100 5,199 10,200 Deferred tax Expense / (Credit) (9,500) (2,200) (4,300) 19,814 48,300 Fringe Benefit Tax 1,300 1,207 1,250 - - Excess provision for taxation in - - (650) - - respect of earlier years written back TOTAL 22,86660,607 24,400 25,01358,500 NET PROFIT AFTER TAX 42,960 108,305 46,447 40,175 73,208

BEFORE ADJUSTMENTS ADJUSTMENTS: a. Adjustments on account of D (B) 1,575 399 370 511 614 changes in Accounting Policies Note 2 b. Other material adjustments (516) (2,705) (8,807) 3,370 4,495 TOTAL OF ADJUSTMENTS 1,059 (2,306) (8,437) 3,881 5,109 TAX IMPACT OF ADJUSTMENTS: - - - (304) (390) a.Current tax impact of

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FOR THE YEAR ENDED MARCH 31, Particulars Reference to Annexures 2008 2007 2006 2005 2004 adjustments b.Deferred tax impact of 60 385 2,840 (1,330) (1,910) adjustments c.Excess provision (current tax) of - - (650) - - earlier years written back TOTAL OF TAX IMPACT OF 60 385 2,190 (1,634) (2,300)

ADJUSTMENTS TOTAL OF ADJUSTMENTS 1,119 (1,921) (6,247) 2,247 2,809

AFTER TAX IMPACT NET PROFIT AS RESTATED 44,079 106,384 40,200 42,422 76,017 Profit and Loss amount at the 65,973 29,461 24,135 16,087 (31,407) beginning of the year Balance available for 110,052 135,845 64,335 58,509 44,610 appropriations, as Restated APPROPRIATIONS Transfer to Capital Redemption - 30,000 - - -

Reserve Transfer to General Reserve 7,500 8,000 4,500 4,000 4,000 Dividend on Preference Shares 10,800 11,974 14,400 14,400 21,738 Dividend on Equity Shares 15,298 15,298 12,238 12,238 - Corporate Dividend Tax 4,435 4,600 3,736 3,736 2,785 TOTAL 38,03369,872 34,874 34,37428,523 Balance Carried Forward, as 72,019 65,973 29,461 24,135 16,087

Restated Statement of Significant Accounting Policies and Notes and D Changes in Significant Accounting Policies

The Annexures C to O form an integral part of the restated accounts. For and on behalf of the Board

Chairman Director

Chief Financial Officer Director Director Place: Mumbai Date: April 28, 2008

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Annexure C Statement of Cash Flows of Automotive Stampings and Assemblies Limited, as Restated

(Currency: Indian Rupee in thousands) Sl. Particulars For the year ended For the year ended For the year ended For the year ended For the year ended No. March 31,2008 March 31,2007 March 31,2006 March 31,2005 March 31,2004 A CASH FLOW FROM OPERATING ACTIVITIES: Restated Net profit before 66,885 166,606 62,410 69,069 136,817 taxation Adjustments for : Depreciation 113,779 106,607 96,702 89,539 73,092 Interest and financial charges 23,793 23,359 19,570 13,927 19,701 Interest income (1,002) (186) (1,213) (159) (539) Profit on sale of investments - (1) (2,496) (1,892) (889) (short term, non-trade) Dividend on Short Term Non- (1,626) (937) (884) - - trade Investments Profit on sale of assets - (692) - - - Loss on sale / write off of assets 301 135,245 - 128,150 189 111,868 319 101,734 240 91,605

Operating Profit before 202,130 294,756 174,278 170,803 228,422 Working Capital Changes Adjusted for: Trade and other Receivables 18,962 (103,967) (23,938) (100,134) 46,375 Inventories 38,769 (35,218) 28,151 (135,243) (56,132) Trade payables and other 51,595 109,326 92,279 (46,906) 76,766 80,979 113,520 (121,857) (50,206) (59,963) liabilities Cash Generated From 311,456 247,850 255,257 48,946 168,459 Operations Direct taxes (32,366) (62,807) (29,350) (5,503) (10,590) NET CASH FROM 279,090 185,043 225,907 43,443 157,869 OPERATING ACTIVITIES (A)

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Sl. Particulars For the year ended For the year ended For the year ended For the year ended For the year ended No. March 31,2008 March 31,2007 March 31,2006 March 31,2005 March 31,2004

B CASH FLOW FROM INVESTING ACTIVITIES: Purchase of fixed assets (544,972) (130,038) (81,691) (211,336) (59,942) Proceeds from sale of fixed 538 1,999 870 558 49 assets Dividend on Short Term Non- 1,626 937 884 - - trade Investments Profit on sale of investments - 1 2,496 1,892 889 (short term, non-trade) Interest received 1,002 186 1,213 159 539 NET CASH USED IN (541,806) (126,915) (76,228) (208,727) (58,465) INVESTING ACTIVITIES (B)

C CASH FLOW FROM FINANCING ACTIVITIES: Interest paid (22,049) (22,076) (18,816) (13,919) (19,681) Redemption of Preference - (30,000) - - - Shares Long Term Loan availed/(paid) 315,010 75,000 10,000 175,000 (182,780) (Net) Sales tax deferral availed/(paid) (3,470) (158,057) 5,745 89,026 24,772 (Net) Other borrowings 16,517 13,483 (25,000) (54,521) 60,038 Equity and Preference Dividend (30,533) (31,713) (30,374) (24,523) - paid (including tax thereon) NET CASH FROM / USED IN 275,475 (153,363) (58,445) 171,063 (117,651) FINANCING ACTIVITIES (C)

Net increase/(decrease) in 12,759 (95,235) 91,234 5,779 (18,247) Cash and Cash equivalents (A) + (B) + ( C) Cash and cash equivalents 7,478 102,713 11,479 5,700 23,947

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Sl. Particulars For the year ended For the year ended For the year ended For the year ended For the year ended No. March 31,2008 March 31,2007 March 31,2006 March 31,2005 March 31,2004 (Opening Balance) Cash and cash equivalents 20,237 7,478 102,713 11,479 5,700 (Closing Balance)

Note: The above Cash Flow Statement has been prepared under the 'Indirect Method' as set out in the Accounting Standard - 3 on 'Cash Flow Statements' issued by the Institute of Chartered Accountants of India. For and on behalf of the Board

Chairman Director

Chief Financial Officer Director Director Place: Mumbai Date: April 28, 2008

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Annexure D Statement of Significant Accounting Policies and Notes and Changes in Significant Accounting Policies

A. SIGNIFICANT ACCOUNTING POLICIES

1 BASIS OF PREPARATION OF FINANCIAL STATEMENTS

These accounts have been prepared under the historical cost convention on the basis of a going concern and in accordance with the accounting principles generally accepted in India.

2 FIXED ASSETS AND DEPRECIATION

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

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

Furniture & Fixtures and Office Equipment (including white goods) 20% Computers 25% Tools, jigs & Fixtures 20% Vehicles 20% Pallets 12.5% b. Leasehold land is amortized over the period of lease. c. Except for items for which 100% depreciation rates are applicable, depreciation on assets added / disposed of during the year has been provided on pro rata basis with reference to the date of addition / disposal. d. Intangible assets are stated at cost less accumulated amortization. Intangible assets are amortized on a straight line basis over their estimated useful life ranging between 3 to 5 years. e. The Management periodically assesses using external and internal sources whether there is an indication that an asset may be impaired. If an asset is impaired, the Company recognizes an impairment loss as the excess of the carrying amount of the asset over the recoverable amount.

3 INVESTMENTS

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

4 INVENTORIES a. Raw materials, components, stores and spares are valued at cost or net realizable value, whichever is lower. Cost is determined using the weighted average basis. b. Finished goods and work-in-process are valued at cost or net realizable value, whichever is lower. Finished goods and work-in-process includes cost of conversion incurred in bringing the inventories to its present location and condition. c. Scrap is valued at net realizable value.

5 REVENUE RECOGNITION

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

2 Price increase or decrease due to change in major raw material cost, pending acknowledgement from major customers, is accrued on estimated basis.

6 FOREIGN CURRENCY TRANSACTIONS

Transactions in foreign currencies are recorded at the exchange rate prevailing on the date of the transaction. Foreign currency Monetary Assets and Liabilities are stated at the exchange rates prevailing at the date of the Balance Sheet. The exchange differences are dealt with, in the Profit and Loss Account. In the case of forward contracts, the difference between the forward rate and the exchange rate on the transaction date is recognised as income or expense over the period of the related contracts.

7 BORROWING COSTS

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

8 EMPLOYEE BENEFITS

(i) Long-term Employee Benefit

(a) Defined Contribution Plans

The Company has Defined Contribution Plans for post employment benefits in the form of Superannuation Fund which is recognised by the Income-tax authorities and administered

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through trustees and Life Insurance Corporation of India (LIC) and Provident Fund. Besides, the Company also makes contribution to the Employees’ State Insurance Scheme. These plans constitute insured benefits as the Company has no further obligation beyond making the contributions. The Company's contributions to Defined Contribution Plans are charged to the Profit and Loss Account as incurred.

(b) Defined Benefit Plans

The Company has Defined Benefit Plan for post employment benefit in the form of Gratuity. Gratuity Fund is recognised by the Income-tax authorities and administered through trustees and Life Insurance Corporation of India (LIC). Liability for Defined Benefit Plan is provided on the basis of valuation, as at the Balance Sheet date, carried out by independent actuary. The actuarial valuation method used by independent actuary for measuring the liability is the Projected Unit Credit method.

Provision for Compensated Absences is based on an actuarial valuation carried out at Balance Sheet date.

(ii) Termination benefits are recognised as an expense as and when incurred.

(iii) Actuarial gains and losses comprise experience adjustments and the effects of changes in actuarial assumptions and are recognised immediately in the Profit and Loss Account as income or expense.

9 TAXATION

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

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

(iii) Deferred tax assets arising from the timing differences are recognized to the extent there is virtual certainty that the assets can be realized in future.

10 WARRANTY EXPENSES

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

B. NOTES AND CHANGES IN SIGNIFICANT ACCOUNTING POLICIES

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1 Restatements to the Audited Financial Statements

Summarized below are the restatements made to the audited financial statements for the years ended March 31, 2004, 2005, 2006, 2007 and 2008 and their impact on the profit of the Company:

(Currency: Indian Rupee in thousands) FOR THE YEAR ENDED MARCH 31, RESTATEMENTS 2008 2007 2006 2005 2004 A. Adjustments a. Adjustments on account of changes in accounting policies: Adjustment on account of reduction in 1,575 1,575 1,575 1,575 1,575 Depreciation due to charging of the Exchange Rate Difference relating to liability for fixed assets to Profit & loss A/c (Refer Note 2 (a) below) Adjustment on account of revision in - (1,176) (1,205) (1,064) (961) Accounting Standard 15, Employee Benefits (Refer Note 2 (b) below) Total 1,575 399 370 511614 b. Other Material Adjustments: Provision for expenses no longer required (1,731) (1,490) (7,966) 4,386 4,495 written back (Refer Note 2 (c) below) Recovery of bad debts written off in earlier - - (841) (1,016) - years (Refer Note 2 (d) below) Adjustment on account of Interest on Tax 1,215 (1,215) Provision pertaining to previous year (Refer Note 2 (e) below) Total (516) (2,705) (8,807) 3,370 4,495 Pre-tax impact of Adjustments - (A) 1,059 (2,306) (8,437) 3,881 5,109 B. Tax impact of Material Adjustments Excess provision (current tax) of earlier years - - (650) - - written back (Refer Note 2 (f) below) - - - (304) (390) Current tax impact of restatements (Refer Note 2 (g) below) 60 385 2,840 (1,330) (1,910) Deferred tax impact of adjustments (Refer Note 2 (g) below) Total Tax impact of Material Adjustments - 60 385 2,190 (1,634) (2,300) (B) Total (A+B) 1,119 (1,921) (6,247) 2,247 2,809

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2 Adjustments a. Exchange Rate Differences relating to liability for fixed assets capitalized in years prior to 2003-04, have been charged to Profit & loss A/c instead of capitalisation to the respective assets in accordance with the new Accounting Standard of the Companies (Accounting Standard) Rules, 2006. The respective adjustment to the fixed assets and accumulated depreciation has been suitably given effect to. b. The Company has, with effect from 1st April, 2007, adopted the Accounting Standard 15, Employee Benefits (revised 2005), issued by the Institute of Chartered Accountants of India. The effect of change in the Policy for earlier years has been adjusted in the relevant financial years to which it relates. The same has been suitably classified under Current Liabilites & Provisions in the respective years. c. Provision for expenses no longer required, written back in the years ended March 31, 2006, March 31, 2007 and March 31, 2008, has been adjusted in the relevant financial years to which the same relates. The same has been suitably classified under Current Liabilites & Provisions in the respective years. d. Debts written off as Bad in earlier years and recovered during the years ended March 31, 2005 and March 31, 2006 have been adjusted in the relevant financial years in which they were written off. The same has been suitably considered under Sundry Debtors in the respective years. e. The interest on current tax for earlier year, accounted in the year ended March 31, 2008 has been adjusted in the relevant financial year to which the same relates. The same has been suitably classified under Current Liabilities & Provisions in the respective year. f. Tax provision for earlier year no longer required, written back in the year ended March 31, 2006, has been adjusted in the relevant financial year to which the same relates. The same has been suitably classified under Loans and Advances / Current Liabilities & Provisions in the respective year. g. The Tax Rate applicable for the respective years has been used to calculate the notional tax impact of adjustments.

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3 Profit and Loss Account as at 01.04.2003, as Restated

(Currency: Indian Rupee in thousands) Particulars Amount

Profit and Loss Account Balance as on 01.04.2003, as per audited Financial Statements (27,673) (10,055) Exchange Rate fluctuations relating to liability of Fixed Assets (Refer Note 2 (a) above) Provisions for expenses pertaining to years prior to 01.04.2003 written back 2,306 (Refer Note 2 (c) above) Excess Provision for current tax pertaining to years prior to 01.04.2003 written back 650 (Refer Note 2 (f) above) Recovery against bad debts pertaining to years prior to 01.04.2003 (Refer Note 2 (d) 1,857 above) Adjustment on account of revision in Accounting Standard 15, Employee Benefits (1,025) (Refer Note 2 (b) above) 2,542 Deferred tax impact of adjustments as above (9) Current tax impact of adjustments as above Profit and Loss Account Balance as on 01.04.2003, as Restated (31,407)

4 Contingent Liabilities (Currency: Indian Rupee in thousands) Sl. AS AT MARCH 31, Particulars No. 2008 2007 2006 2005 2004 1 Bills discounted not matured 578,398 635,082 671,911 546,289 399,052 Claims against the company not - 2,203 2,385 1,533 454 2 acknowledged as Debts

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Annexure E Statements of Dividends Paid/Proposed of Automotive Stampings and Assemblies Limited

FOR THE YEAR ENDED MARCH 31 Particulars 2008 2007 2006 2005 2004 DIVIDEND ON PREFERENCE

SHARES: Number of Preference Shares i) Outstanding 9,000,000 9,000,000 12,000,000 12,000,000 12,000,000 ii) Redeemed - 3,000,000 - - - Face value per share (Rs.) 10 10 10 10 10 Paid up value per share (Rs.) 10 10 10 10 10 Rate of Dividend % 12% 12% 12% 12% 12%

Total Dividend Paid on 10,800 11,974 14,400 14,400 21,738 preference shares (Rs. in '000) (Refer Note (Refer Note 1 below) 2 below)

DIVIDEND ON EQUITY

SHARES: Number of Equity Shares 10,198,541 10,198,541 10,198,541 10,198,541 10,198,541 Face Value Per Share (Rs.) 10 10 10 10 10 Paid Up Value Per Share (Rs.) 10 10 10 10 10 Rate of Dividend % 15% 15% 12% 12% - Total Dividend Paid on equity 15,298 15,298 12,238 12,238 - shares (Rs. in '000)

TAX ON DIVIDENDS i) Preference Shares 1,835 2,000 2,020 2,020 2,785 ii) Equity Shares 2,600 2,600 1,716 1,716 - Total Tax on Dividends 4,435 4,600 3,736 3,736 2,785

Notes:

1. 3,000,000 Preference Shares were redeemed on 29th July, 2006 by exercising the option of redemption before maturity by the Company.

2. Dividend declared for 2003-04 includes arrears of Preference Dividend for the year 2002-03 of Rs. 7,338 thousands.

3. Dividend for the year ended March 31, 2008 is proposed.

4. Amount paid as dividend on equity shares in the past is not indicative of the Dividend Policy of the Company in future.

5. The figures disclosed above are based on the financial statements of the Company.

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Annexure F Statement of Related Party Transactions

A] List of Related Parties with whom the Company has had transactions and the nature of Relationship

Sl. Nature of For the year ended March 31, No. Relationship 2008 2007 2006 2005 2004 i) Holding 1. Tata AutoComp Tata Tata Tata Tata Company Systems Limited AutoComp AutoComp AutoComp AutoComp and (Holding Systems Systems Systems Systems Controlling Company upto Limited Limited Limited Limited Enterprise August 20, 2007 (Holding (Holding (Holding (Controlling and Controlling Company) Company) Company) Enterprise Enterprise w.e.f. upto March August 21, 2007) 25, 2004 and Holding Company w.e.f. March 26, 2004) 2. Gestamp Servicios, S.L. (w.e.f. August 21, 2007) ii) Fellow 1. Tata Toyo Tata Toyo Tata Toyo Tata Toyo Tata Toyo Subsidiary & Radiator Limited Radiator Radiator Radiator Radiator Enterprise (Fellow Limited Limited Limited Limited under Subsidiary upto (Fellow (Fellow (Fellow (Fellow Common August 20, 2007 Subsidiary) Subsidiary) Subsidiary) Subsidiary Control and Enterprise w.e.f. March under Common 26, 2004) Control w.e.f. August 21, 2007)

2. Estampaciones Metalicas Vizcaya S.A. (Enterprise under Common Control w.e.f. August 21, 2007) iii) Key Mr. Nagaraju Mr. Vilas Mr. Vilas Mr. Sanjiv Mr. A.K. Management Srirama Divadkar Divadkar Kumar Puri Personnel (Upto April (Upto (Upto May 15, 2006) March 7, 22, 2003) 2005)

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Sl. Nature of For the year ended March 31, No. Relationship 2008 2007 2006 2005 2004 Mr. Rajesh Mr. Sanjiv Sahay Kumar (From (From April 19, October 1, 2006 to 2003) February 15, 2007) Mr. Nagaraju Srirama (From February 16, 2007)

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B] Statement of Transactions with Related Parties and Details of Outstanding Balances (Currency: Indian Rupee in thousands) Nature of Year Tata Gestamp Estampacione Tata Toyo Key transactions AutoComp Servicios, S.L. s Metalicas Radiator Management Grand Total Systems Vizcaya, S.A. Limited Personnel Limited Transa Outsta Transa Outsta Transa Outsta Transa Outsta Transa Outsta Transac Outsta ction nding ction nding ction nding ction nding ction nding tion nding Value Balance Value Balance Value Balance Value Balance Value Balance Value Balance

Services 2007-08 36,017 19,485 ------36,017 19,485 received 2006-07 30,000 ------30,000 - 2005-06 69,88119,733 ------69,881 19,733 2004-05 67,74119,408 ------67,741 19,408 2003-04 45,99123,713 ------45,991 23,713

Advance given 2007-08 29,818 21,109 ------29,818 21,109 for purchases and services 2006-07 37,45333,995 ------37,453 33,995 2005-06 ------2004-05 ------2003-04 ------

Purchase of 2007-08 9,029 ------9,029 - goods 2006-07 15 20 ------1520 2005-06 ------2004-05 ------

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Nature of Year Tata Gestamp Estampacione Tata Toyo Key transactions AutoComp Servicios, S.L. s Metalicas Radiator Management Grand Total Systems Vizcaya, S.A. Limited Personnel Limited Transa Outsta Transa Outsta Transa Outsta Transa Outsta Transa Outsta Transac Outsta ction nding ction nding ction nding ction nding ction nding tion nding Value Balance Value Balance Value Balance Value Balance Value Balance Value Balance 2003-04 ------

Purchase of 2007-08 ------fixed assets 2006-07 3,910 ------3,910 - 2005-06 ------2004-05 ------2003-04 ------

Purchase of 2007-08 76,990 ------76,990 - DEPB License 2006-07 ------2005-06 ------2004-05 ------2003-04 ------

Reimbursemen 2007-08 3,970 800 ------3,970 800 t of expenses 2006-07 3,377130 ------3,377 130 2005-06 13,5761,278 ------13,576 1,278 2004-05 7,664410 ------7,664 410 2003-04 4,788297 ------4,788 297

Technical 2007-08 ----9,329 8,344 9,329 8,344 Assistance Fees 2006-07 ------

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Redemption of 2007-08 ------Preference Shares 2006-07 30,000 ------30,000 - 2005-06 ------2004-05 ------2003-04 ------

Dividend paid 2007-08 10,800 ------10,800 - on Preference Shares 2006-07 15,574 ------15,574 - 2005-06 14,400 ------14,400 - 2004-05 21,738 ------21,738 - 2003-04 ------

Dividend paid 2007-08 6,710 - 5,737 ------12,447 - on Equity Shares 2006-07 9,955 ------9,955 - 2005-06 9,955 ------9,955 - 2004-05 ------

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Sale of goods 2007-08 356 466 - - - - 2,296 1,023 - - 2,652 1,489 2006-07 ------2,149 4,042 - - 2,149 4,042 2005-06 ------3,474 2,152 - - 3,474 2,152 2004-05 ------8,001 2,055 - - 8,001 2,055 2003-04 ------4053,255 - - 405 3,255

Managerial Remuneration

Mr. Nagaraju 2007-08 ------4,228 113 4,228 113 Srirama Mr. Nagaraju ------479-479- Srirama Mr. Rajesh ------1,697 - 1,697 - 2006-07 Sahay Mr. Vilas ------230-230- Divadkar Mr. Vilas 2005-06 ------4,830 - 4,830 - Divadkar Mr. Sanjiv 2004-05 ------2,979 - 2,979 - Kumar Mr. Sanjiv ------1,377 - 1,377 - Kumar 2003-04 Mr. A. K. ------296-296-

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Annexure G Statement of Other Income of Automotive Stampings and Assemblies Limited, as Restated

(Currency: Indian Rupee in thousands) FOR THE YEAR ENDED MARCH 31 Nature of Particulars 2008 2007 2006 2005 2004 Income Interest Income 1,002 186 1,213 159 539 Recurring Profit on sale of investments (short - 1 2,496 1,892 889 Non-recurring term, non-trade) Dividend on Short Term Non-trade 1,626 937 884 - - Non-recurring Investments Cash Discount 1,394 1,938 554 368 3,637 Recurring Gain on Foreign Exchange - 154 65 - 441 Non-recurring Fluctuations Miscellaneous Income 9,265 8,751 4,158 2,912 87 Recurring Gain on Remission of Liability - 101,816 - - 35,045 Non-recurring (Refer Note 1 below) Profit on Sale of Fixed Assets - 692 - - - Non-recurring (Net) Total 13,287 114,475 9,370 5,331 40,638

Notes:

1. The Company availed the scheme for Premature Repayment of Sales Tax Deferral Loan framed by the Government of Maharashtra and prepaid part of the deferral loan at the prescribed net present value. This resulted in a gain of Rs. 101,816 thousand and Rs. 35,045 thousand in the financial year 2006-07 and 2003-04 respectively.

2. The classification of income into recurring and non-recurring is based on the current operations and business activity of the Company.

3. Other income exceeds 20% of the Restated Profit Before Tax in the years 2003-04 and 2006-07.

4. All items of Other Income are from normal business activities.

5. The above items are after adjustments mentioned in Note B 2 (c) and (d) of Annexure D.

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Annexure H Statement of Accounting Ratios of Automotive Stampings and Assemblies Limited, as Restated

Sl. AS AT / FOR THE YEAR ENDED MARCH 31 Particulars No. 2008 2007 2006 2005 2004 1 Restated Profit after Tax (Rs. in '000) 44,079 106,384 40,200 42,422 76,017 Less: Preference Dividend for the year 12,635 13,974 16,420 16,420 16,245 2 including tax thereon (Rs. in '000) 3 Net Profit available to Equity Shareholders 31,444 92,410 23,780 26,002 59,772 Weighted average number of Equity Shares 10,198,541 10,198,541 10,198,541 10,198,541 10,198,541 4 outstanding during the year Number of Equity Shares outstanding at the 10,198,541 10,198,541 10,198,541 10,198,541 10,198,541 5 end of the year Net Worth for Equity Shareholders 426,863 413,317 338,805 328,979 316,931 6 (Rs. in '000) 7 Accounting Ratios: Earnings per Share (Rs.) (3)/(4) 3.08 9.06 2.33 2.55 5.86 Return on Net Worth for Equity 7.37% 22.36% 7.02% 7.90% 18.86%

Shareholders(3)/(6)-% Net Asset Value Per Share (Rs.) (6)/(5) 41.86 40.53 33.22 32.26 31.08

Note:

The above ratios have been computed on the basis of the Restated Summary Statements- Annexure A & Annexure B.

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Annexure I Statement of Secured Loans of Automotive Stampings and Assemblies Limited, as Restated

(Currency: Indian Rupee in thousands) AS AT MARCH 31 Particulars 2008 2007 2006 2005 2004

Term Loans from Banks 575,010 260,000 185,000 175,000 -

Working Capital Loans from Banks 30,000 13,483 - 25,000 79,521

Total 605,010 273,483 185,000 200,000 79,521

Statement of Secured Loans outstanding as on March 31, 2008

Sl. Lender Amount Amount Rate of Repayment Security No. Sanctioned Outstanding Interest % Terms (Rs. '000) as at March 31, 2008 (Rs. '000) 1 Term Loans from Banks:- a. State 200,000 90,010 3.25% below Repayable in First Pari Passu Bank of State Bank monthly Charge on the India Advance instalments. existing and Rate (SBAR) Repayment future Fixed ending in Assets of September, Chakan Plant of 2009. the Company. b. State 200,000 150,000 1.25% below Repayable in First Pari Passu Bank of SBAR monthly Charge on the India instalments. existing and Repayment future Fixed ending in Assets of March, 2011. Chakan Plant of the Company. c. State 150,000 150,000 1.50% below Repayable in First Pari Passu Bank of SBAR monthly Charge on the India instalments. existing and Repayment future Fixed ending in Assets of March, 2012. Pantnagar Plant of the Company.

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Sl. Lender Amount Amount Rate of Repayment Security No. Sanctioned Outstanding Interest % Terms (Rs. '000) as at March 31, 2008 (Rs. '000) d. Bank of 300,000 185,000 2.25 % Phased First Pari Passu India (Refer Note below Repayment Charge on the below) Benchmark ending on existing and Prime March 31, future Fixed Lending Rate 2013. Assets of of the Bank Moratorium Chakan Plant of (BPLR), of 12 months the Company. Minimum from drawal. 11% p.a. 2 Working Capital Loans from Banks:- a. HDFC 30,000 30,000 10% p.a. On Demand (i) First Pari Bank Passu Limited Hypothecation Charge on current assets of the Company, both present and future. (ii) Second Pari Passu Charge on Fixed Assets of Chakan Plant of the Company. Total 605,010

Note: Drawal of term Loan till March 31, 2008 is only Rs. 185,000 thousand.

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Annexure J

Statement of Unsecured Loans of Automotive Stampings and Assemblies Limited, as Restated

(Currency: Indian Rupee in thousands) AS AT MARCH 31 Particulars 2008 2007 2006 2005 2004

Interest Free Sales Tax Loan (Refer Notes 18,594 22,064 180,121 174,376 85,350 below)

Total 18,594 22,064 180,121 174,37685,350

Notes:

1. These amounts represent Sales Tax Deferral Loans availed by Chakan and Halol Unit of the Company in accordance with the Schemes framed by the respective State Governments. The outstanding loan balance as on March 31, 2008 is Rs. 4,490 thousand and Rs. 14,104 thousand for Chakan and Halol unit respectively.

2. The Company has prepaid a part of the Deferral Loan of Chakan Unit in 2003-04 and 2006- 07 as per the Scheme of Prepayment framed by the Government of Maharashtra.

3. Repayment: Phased repayment, the last instalment for the Loan availed by the Halol Unit is due in the Financial year 2011-12 and for the loan availed by the Chakan unit is due in the Financial year 2014-15.

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Annexure K Statement showing Details of Sundry Debtors of Automotive Stampings and Assemblies Limited, as Restated

(Currency: Indian Rupee in thousands) AS AT MARCH 31 Particulars 2008 2007 2006 2005 2004 Due for a period exceeding six months 25,631 18,434 13,433 12,290 11,466 Others 204,303 252,068 182,566 142,989 116,078 Sub-total (Refer Note 1 below) 229,934 270,502 195,999 155,279 127,544 Less: Provision for doubtful debts (24,296) (16,025) (11,450) (8,777) (7,117) Total 205,638 254,477 184,549 146,502 120,427 Notes: 1. The amounts recoverable from 1,489 4,042 2,152 2,055 3,255 related parties included above 2. The above items are after adjustments mentioned in Note B 2 (d) of Annexure D.

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Annexure L Statement showing Details of Loans and Advances of Automotive Stampings and Assemblies Limited, as Restated

(Currency: Indian Rupee in thousands) FOR THE YEAR ENDED MARCH 31 Particulars 2008 2007 2006 2005 2004 CONSIDERED GOOD: Advances recoverable in cash or in kind or for 120,959 100,112 59,727 65,413 20,152 value to be received (Refer Note 1 below) Bills of Exchange - - 1,318 13,738 1,903 Balance with Excise Authorities 24,494 19,447 19,241 16,052 2,562 Advance Tax (net of provision for taxes) 3,280 - 4,531 3,724 - Sub-total (A) 148,733 119,559 84,817 98,927 24,617

CONSIDERED DOUBTFUL: Advances recoverable in cash or in kind or for 2,200 1,000 - - - value to be received Less : Provision for doubtful advances 2,200 1,000 - - - Sub-total (B) - - - - - Total (A) + (B) 148,733 119,559 84,817 98,927 24,617 Notes: 1. The amounts recoverable from 21,109 33,995 - - - related parties included above 2. The above items are after adjustments mentioned in Note B 2 (f) of Annexure D.

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Annexure M Statement of Capitalisation of Automotive Stampings and Assemblies Limited

(Currency: Indian Rupee in thousands) Pre-Issue as at Particulars March 31, 2008 Borrowings: Short Term Debt 203,608 Long Term Debt 419,996 Total Debts 623,604 - Shareholders Funds - Equity Share Capital 101,985 Preference Share Capital 90,000 Reserves and Surplus 324,878 Total Shareholders Funds 516,863 Long Term Debt/Equity Ratio 0.81

Notes: i) The above has been computed on the basis of the Restated Financial Statements. ii) The issue price and the number of shares are being finalized as such the Post-Issue Capitalisation Statement cannot be presented.

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Annexure N Statement of Tax Shelter of Automotive Stampings and Assemblies Limited, as Restated

(Currency: Indian Rupee in thousands) Sl. FOR THE YEAR ENDED MARCH 31 Particulars No. 2008 2007 2006 2005 2004 A Profit before Tax & Adjustments 65,826 168,912 70,847 65,188 131,708 B Tax Rate 33.99% 33.66% 33.66% 33.66% 35.875% C Tax thereon at the above rate 22,374 56,856 23,847 21,942 47,250 Adjustments: D Permanent Differences 2,241 (929) (884) 27 -

E Timing Differences: Difference in Book Depreciation & 18,252 11,203 42,898 9,439 15,635 Depreciation under Income Tax Act,1961 (“I.T. Act”) Net Disallowable / (Allowable) sum (6,911) 813 (3,958) 8,719 7,818

under section 43B of the I.T.Act Provision for Doubtful debts and 9,470 5,576 2,673 1,660 3,170

Advances Set off of Unabsorbed Depreciation - - (18,421) (96,812) (158,954) Other Disallowable / (Allowable) sums 2,469 (2,620) (9,723) 11,779 623

F Total Timing Differences 23,280 14,972 13,469 (65,215) (131,708)

G Net Adjustments (D+F) 25,521 14,043 12,585 (65,188) (131,708)

H Tax expense / (saving) thereon 8,675 4,727 4,236 (21,942) (47,250)

I Tax Liability (C+H) 31,049 61,583 28,083 - -

J Tax Liability under MAT - - - 5,194 10,200

K Net Tax Liability 31,049 61,583 28,083 5,194 10,200

L Wealth Tax 17 17 17 5 -

M Total Current Tax (K+L) 31,066 61,600 28,100 5,199 10,200

Impact of Material Adjustments for 1,059 (2,306) (8,437) 3,881 5,109 N Restatement in corresponding years

Tax Liability under MAT on Material - - - 304 390 O adjustments for Restatement in corresponding years

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Sl. FOR THE YEAR ENDED MARCH 31 Particulars No. 2008 2007 2006 2005 2004

Taxable Profit before Tax and after 92,406 180,649 74,995 3,881 5,109 P adjustments as Restated (A+G+N)

Total Tax Liability after tax impact 31,066 61,600 28,100 5,503 10,590 Q of adjustments (M+O)

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Annexure O Statement of Segmental Information of Automotive Stampings and Assemblies Limited, as Restated

Primary Segment: Business Segment The Company operates only in the Automobile Component segment.

Secondary Segment: Geographical Segment

(Currency: Indian Rupee in thousands) Year ended March 31, Segment Revenues 2008 2007 2006 2005 2004

Revenues within India 3,493,754 3,631,971 3,231,467 2,878,958 2,060,297

Revenues outside India 52,916 55,646 25,859 39,273 1,005

Gross Sales 3,546,670 3,687,617 3,257,326 2,918,231 2,061,302

Note: All the assets of the Company are located within India.

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion of our financial condition and results of operations is based on our Financial Statements as stated in the report dated April 28, 2008 of our Statutory Auditors. Our fiscal year ends on March 31 of each year. Accordingly, all references to a particular fiscal year are to the twelve month period ended on March 31 of that year.

OVERVIEW

We are an experienced and large manufacturer of a range of sheet metal components and assemblies for the automotive industry. We are primarily a Tier I auto components supplier.

We are into the production of a wide range of sheet metal components which form about 60% of the weight of a vehicle. The outer part of the chassis of a vehicle is made from sheet metal pressings. Sheet metal sub-assemblies are used in the underbody of the vehicle, exhaust systems, fuel tanks, skin panels, brackets, oil sumps and supporting panels. Our product mix can be broadly classified into three categories: i) Components ii) Welded Assemblies and iii) Modules/Aggregates. Some of the products manufactured by us are skin panels for cars, tractors, cabin and BIW parts, suspension parts, underbody parts, fuel tanks and oil sumps.

Our Company counts some of the most prestigious vehicle manufacturers in the country like Tata Motors Limited, General Motors India Private Limited, Fiat India Private Limited, Mahindra & Mahindra Limited and John Deere Equipment Private Limited.

SIGNIFICANT DEVELOPMENTS SINCE THE DATE OF LAST FINANCIAL STATEMENTS

There is no significant development since the date of last financial statements.

FACTORS AFFECTING THE RESULTS OF OUR OPERATIONS

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The following factors affect the results of our operations:

• Macroeconomic factors • Degree of success in obtaining orders from new OEMs • Managing pricing pressures • Ability to raise funds at competitive rates • Price fluctuations - Steel price fluctuations • Continuous increase in input costs –operational efficiency • Increasing competition

SIGNIFICANT ACCOUNTING POLICIES

Our Financial Statements are prepared in accordance with the relevant provisions of the Companies Act, 1956 and restated in accordance with the SEBI Guidelines. Some of our accounting policies are particularly important to the portrayal of our financial position and results of operations and require the application of assumptions and estimates of our management. Some of the important accounting policies are as under:

a) Basis of Accounting:

The accounts have been prepared under the historical cost convention on the basis of a going concern and in accordance with the accounting principles generally accepted in India. b) Inventories

i. Raw materials, components, stores and spares are valued at cost or net realizable value, whichever is lower. Cost is determined using the weighted average basis.

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

iii. Scrap is valued at net realizable value.

c) Revenue Recognition

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

Price increase or decrease due to change in major raw material cost, pending acknowledgement from major customers, is accrued on estimated basis.

d) Fixed Assets

Fixed assets are stated at cost of acquisition or construction less accumulated depreciation. All costs relating to the acquisition and installation of fixed assets are capitalized and include

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borrowing costs directly attributable to construction or acquisition of fixed assets, upto the date the asset is put to use.

e) Depreciation

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

Furniture & Fixtures and Office Equipment (including white goods) 20.00% Computers 25.00% Tools, Jigs & Fixtures 20.00% Vehicles 20.00% Pallets 12.50%

f) Employee Benefits

i. Defined Contribution Plans

The Company has Defined Contribution Plans for post employment benefits in the form of Superannuation Fund which is recognised by the Income-tax authorities and administered through trustees and Life Insurance Corporation of India (LIC) and Provident Fund. Besides, the Company also makes contribution to the Employees’ State Insurance Scheme. These plans constitute insured benefits as the Company has no further obligation beyond making the contributions. The Company's contributions to Defined Contribution Plans are charged to the Profit and Loss Account as incurred. ii. Defined Benefit Plans

Provision for Compensated Absences is based on an actuarial valuation carried out at Balance Sheet date. iv. Termination benefits are recognized as an expense as and when incurred.

v. Actuarial gains and losses comprise experience adjustments and the effects of changes in actuarial assumptions and are recognized immediately in the Profit and Loss Account as income or expense.

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g) Taxation on Income

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

In accordance with Accounting Standard 22 – ‘Accounting for Taxes on Income’, issued by the Institute of Chartered Accountants of India, the deferred tax for timing differences between the book and tax profits for the year is accounted for using the tax rates and laws that have been enacted or substantively enacted as of the balance sheet date.

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

RESULTS OF RESTATED OPERATIONS (Rs. in Mn) Year ended March 31 2008 2007 2006 2005 INCOME Net Sales 3,009.87 3,131.85 2,767.97 2,498.84 Other income 15.02 115.97 18.22 6.35 Total Income 3,024.89 3,247.81 2,786.19 2,505.19

EXPENDITURE Raw Material Consumed (incl. change in stock) 2,223.77 2,384.45 2,032.78 1,791.13 (As a % of net sales) 73.88% 76.14% 73.44% 71.68% Payments to and Provisions for Employees 221.68 182.15 165.38 143.19 (As a % of net sales) 7.37% 5.82% 5.97% 5.73% Manufacturing, Selling and Other Expenses 374.47 380.76 399.33 400.65 (As a % of net sales) 12.44% 12.16% 14.43% 16.03% Interest and Finance Charges 23.79 23.36 19.57 13.93 (As a % of net sales) 0.79% 0.75% 0.71% 0.56% Depreciation & Amortisation 115.35 108.18 98.28 91.11 (As a % of net sales) 3.83% 3.45% 3.55% 3.65% Total Expenditure 2,959.06 3,078.90 2,715.34 2,440.00

Net Profit Before Tax 65.83 168.91 70.85 65.19 (As a % of total income) 2.18% 5.20% 2.54% 2.60% Provision for Tax 22.87 60.61 24.40 25.01

Net Profit After Tax before adjustments 42.96 108.31 46.45 40.18 (As a % of total income) 1.42% 3.33% 1.67% 1.60% Adjustments after tax impact 1.12 (1.92) (6.25) 2.25

Net Profit as Restated 44.08 106.38 40.20 42.42 (As a % of total income) 1.46% 3.28% 1.44% 1.69%

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Comparison of Fiscal 2008 and 2007

Net Sales

Our net sales decreased by 3.89 % from Rs.3,131.85 million in Fiscal 2007 to Rs. 3,009.87 million in Fiscal 2008. The primary reason for this decrease is the reduction in volumes of customer programmes being handled by the Company.

Other Income

Our sources of other income mainly consist of income from investments, cash discount received and miscellaneous receipts. Other income decreased by 87.05% from Rs. 115.97 million in Fiscal 2007 to Rs. 15.02 million in Fiscal 2008. The primary reason for this decrease is that in Fiscal 2007, there was a one time income of Rs. 101.82 million arising in the form of gain on prepayment of Sales Tax Deferral Loan.

Total Income

On account of the reasons stated in the foregoing, our total income decreased by 6.86% from Rs.3,247.81 million in Fiscal 2007 to Rs. 3,024.89 million in Fiscal 2008.

Raw Material Consumed (including Change in Stock)

Raw material consumed (including change in stock) decreased by 6.74% from Rs. 2,384.45 million in Fiscal 2007 to Rs. 2,223.76 million in Fiscal 2008 because of decrease in net sales and decrease in consumption of raw material as a percentage of net sales from 76.14% in Fiscal 2007 to 73.88% in Fiscal 2008. Raw material as a percentage of net sales came down due to Value Analysis and Value Engineering (VAVE) efforts, tighter control over material accounting and material lying with job workers.

Payments to and provisions for employees

Employee cost increased by 21.70% from Rs. 182.15 million in Fiscal 2007 to Rs. 221.68 million in Fiscal 2008 due to increase in normal wages payable to contract employees as well as year-on-year salary hikes. Employee cost as a percentage of net sales also increased from 5.82% in Fiscal 2007 to 7.37 % in Fiscal 2008 for the same reason.

Manufacturing, Selling & Other Expenses

Manufacturing, selling and other expenses decreased by 1.65% from Rs. 380.76 million in Fiscal 2007 to Rs.374.47 million in Fiscal 2008. However, as a percentage of net sales, manufacturing, selling and other expenses increased from 12.16% in Fiscal 2007 to 12.44 % in Fiscal 2008.

Interest and Finance Charges

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Interest and finance charges have increased by 1.84% from Rs 23.36 million in Fiscal 2007 to Rs.23.79 million in Fiscal 2008. Interest and finance charges as a proportion of net sales increased from 0.75% in Fiscal 2007 to 0.79% in Fiscal 2008. The increase was mainly on account of drawal of term loans for expansion projects.

Depreciation and Amortization

Depreciation has increased by 6.63% from Rs.108.18 million in Fiscal 2007 to Rs.115.35 million in Fiscal 2008 due to addition of fixed assets. Depreciation as a percentage of net sales has increased from 3.45% in Fiscal 2007 to 3.83% in Fiscal 2008.

Taxation

We provide for taxes, comprising of current income tax, fringe benefit tax and deferred taxes.

Current tax provision has decreased by 49.56% from Rs.61.60 million in Fiscal 2007 to Rs.31.07 million in Fiscal 2008.

Deferred Tax Credit increased from Rs. 2.20 million in Fiscal 2007 to Rs.9.50 million in Fiscal 2008.

Fringe Benefit Tax has increased by 7.44% from Rs.1.21 million in Fiscal 2007 to Rs.1.30 million in Fiscal 2008.

Effective tax rate has decreased from 35.88% in Fiscal 2007 to 34.74% in Fiscal 2008. Effective tax rate is computed by taking into account current tax, deferred tax and fringe benefit tax.

Profit after Tax as per Audited statement of Accounts

Profit after Tax has decreased by 60.34% from Rs.108.31 million in Fiscal 2007 to Rs.42.96 million in Fiscal 2008. Profit after Tax as a percentage of net sales has decreased from 3.46% in Fiscal 2007 to 1.43% due to all the aforementioned factors.

Net Profit after Tax as Restated

Restated Profit after Tax has decreased by 58.56% from Rs.106.38 million in Fiscal 2007 to Rs.44.08 million in Fiscal 2008. Restated Profit after Tax as a percentage of net sales has decreased from 3.40% in Fiscal 2007 to 1.46% due to all the aforementioned factors. The audited financial statements have been restated on account of changes in the accounting policies and other material adjustments.

Fixed Assets including CWIP

Fixed assets (including CWIP) have increased by 65.69% from Rs.655.16 million in Fiscal 2007 to Rs.1,085.51 million in Fiscal 2008. This is due to increase in CWIP from Rs. 71.68 million in Fiscal 2007 to Rs. 394.34 million in Fiscal 2008. The increase in CWIP is on account of

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expenditure incurred for new plant at Pantnagar. Moreover, the increase in fixed assets was due to the capital expenditure incurred at Chakan.

Inventories

The inventory has decreased by 11.02% from Rs. 351.92 million in Fiscal 2007 to Rs. 313.15 million in Fiscal 2008 on account of scaling down of production and decrease in inventory turnover period from approximately 54 days in Fiscal 2007 to approximately 51 days in Fiscal 2008. This decrease in inventory turnover period is primarily due to better inventory management.

Inventory turnover period is calculated as number of days of material consumption which includes the change in stock

Sundry Debtors

The debtors have decreased by 19.19% from Rs. 254.48 million in Fiscal 2007 to Rs. 205.64 million in Fiscal 2008 on account of reduction in gross sales and decrease in collection period from approximately 30 days in Fiscal 2007 to approximately 25 days in Fiscal 2008. This decrease in collection period is primarily due to introduction of stricter control mechanisms in the Company’s ERP system.

Sundry Creditors

The creditors have decreased by 12.86% from Rs. 331.65 million in Fiscal 2007 to Rs. 288.99 million in Fiscal 2008 on account of reduction in payment terms of some of the suppliers. The payment period has decreased from approximately 39 days in Fiscal 2007 to approximately 35 days in Fiscal 2008. This decrease in payment period is primarily due to the aforementioned reduction in payment terms of some of the suppliers.

Comparison of Fiscal 2007 and 2006

Net Sales

Our net sales increased by 13.15 % from Rs.2,767.97 million in Fiscal 2006 to Rs. 3,131.85 million in Fiscal 2007. The primary reason for this increase is the increase in volumes of customer programmes being handled by the Company.

Other Income

Other income increased by 536.50% from Rs. 18.22 million in Fiscal 2006 to Rs. 115.97 million in Fiscal 2007. The primary reason for this increase is that in Fiscal 2007, there was a one time income of Rs. 101.82 million arising from prepayment of Sales Tax Deferral Loan.

Total Income

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On account of the reasons stated in the foregoing, our total income increased by 16.57% from Rs.2,786.19 million in Fiscal 2006 to Rs. 3,247.81 million in Fiscal 2007.

Raw Material Consumed (including Change in Stock)

Raw material consumed (including change in stock) increased by 17.30% from Rs. 2,032.78 million in Fiscal 2006 to Rs. 2,384.45 million in Fiscal 2007. Raw material consumption as a percentage of net sales increased from 73.44% in Fiscal 2006 to 76.14% in Fiscal 2007. This increase is primarily due to the change in the product mix.

Payments to and provisions for employees

Employee cost increased by 10.14% from Rs. 165.38 million in Fiscal 2006 to Rs. 182.15 million in Fiscal 2007 due to year-on-year salary hikes.. However, employee cost as a percentage of net sales decreased from 5.97% in Fiscal 2006 to 5.82% in Fiscal 2007 due to the increase in net sales being proportionately greater than the increase in employee cost. .

Manufacturing, Selling & Other Expenses

Manufacturing, selling and other expenses decreased by 4.65% from Rs. 399.33 million in Fiscal 2006 to Rs. 380.76 million in Fiscal 2007. Manufacturing, Selling and other expenses as a percentage of net sales decreased from 14.43% in Fiscal 2006 to 12.16% in Fiscal 2007. The decrease was primarily on account of reduction in overheads.

Interest and Finance Charges

Interest and finance charges have increased by 19.36% from Rs.19.57 million in Fiscal 2006 to Rs.23.36 million in Fiscal 2007. Interest and finance charges as a proportion of net sales increased from 0.71% in Fiscal 2006 to 0.75% in Fiscal 2007. The increase was mainly on account of increase in term loans.

Depreciation and Amortization

Depreciation has increased by 10.07% from Rs.98.28 million in Fiscal 2006 to Rs. 108.18 million in Fiscal 2007. Increase in depreciation is due to increased capital expenditure in Fiscal 2007.

Taxation

Current tax provision has increased by 119.22% from Rs. 28.10 million in Fiscal 2006 to Rs.61.60 million in Fiscal 2007.

Deferred Tax Credit decreased from Rs. 4.30 million in Fiscal 2006 to Rs.2.20 million in Fiscal 2007.

Fringe Benefit Tax has decreased by 3.20% from Rs.1.25 million in Fiscal 2006 to Rs.1.21

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million in Fiscal 2007.

Effective tax rate has increased from 34.44% in Fiscal 2006 to 35.88% in Fiscal 2007. Effective tax rate is computed by taking into account current tax, deferred tax and fringe benefit tax.

Profit after Tax as per Audited statement of Accounts

Profit after Tax has increased by 133.18% from Rs.46.45 million in Fiscal 2006 to Rs.108.31 million in Fiscal 2007. Profit after Tax as a percentage of net sales has increased from 1.68% in Fiscal 2006 to 3.46% due to all the aforementioned factors.

Net Profit after Tax as Restated

Restated Profit after Tax has increased by 164.63% from Rs.40.20 million in Fiscal 2006 to Rs.106.38 million in Fiscal 2007. Restated Profit after Tax as a percentage of net sales has increased from 1.45% in Fiscal 2006 to 3.40% due to all the aforementioned factors. The audited financial statements have been restated on account of changes in the accounting policies and other material adjustments.

Fixed Assets including CWIP

Fixed assets (including CWIP) have increased by 3.49% from Rs.633.04 million in Fiscal 2006 to Rs.655.16 million in Fiscal 2007. This is due to capital expenditure incurred for the Chakan plant.

Inventories

The inventory has increased by 11.12% from Rs. 316.70 million in Fiscal 2006 to Rs. 351.92 million in Fiscal 2008. However, the inventory turnover period has decreased from approximately 57 days in Fiscal 2006 to approximately 54 days in Fiscal 2007 due to better inventory management.

Sundry Debtors

The debtors have increased by 37.89% from Rs.184.55 million in Fiscal 2006 to Rs. 254.48 million in Fiscal 2007. The Collection period has increased from approximately 24 days in Fiscal 2006 to approximately 30 days in Fiscal 2007. This increase in collection period is primarily due to supplementary invoices raised on major customers at the end of the year.

Sundry Creditors

The creditors have increased by 48.78% from Rs. 222.91 million in Fiscal 2006 to Rs. 331.65 million in Fiscal 2007. Payment period has increased from approximately 29 days in Fiscal 2006 to approximately 39 days in Fiscal 2007. This increase in average payment period is primarily due to increase in payment terms by steel suppliers.

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Comparison of Fiscal 2006 and 2005

Net Sales

Our net sales increased by 10.77 % from Rs.2,498.84 million in Fiscal 2005 to Rs. 2,767.97 million in Fiscal 2006. The primary reason for this increase is the increase in volumes of customer programmes being handled by the Company.

Other Income

Other income increased by 186.93 % from Rs. 6.35 million in Fiscal 2005 to Rs. 18.22 million in Fiscal 2006. The primary reason for this increase is increase in income from investments in mutual funds.

Total Income

On account of the reasons stated in the foregoing, our total income increased by 11.22 % from Rs.2,505.19 million in Fiscal 2005 to Rs. 2,786.19 million in Fiscal 2006.

Raw Material Consumed (including Change in Stock)

Raw material consumed increased by 13.49% from Rs. 1,791.13 million in Fiscal 2005 to Rs. 2,032.78 million in Fiscal 2006 primarily on account of increased production driven by increased net sales. As a percentage of net sales, raw material consumption has increased from 71.68 % in Fiscal 2005 to 73.44 % in Fiscal 2006 primarily due to increase in steel prices.

Payments to and provisions for employees

Employee cost increased by 15.50 % from Rs. 143.19 million in Fiscal 2005 to Rs. 165.38 million in Fiscal 2006. The primary reasons for increase in employee cost were increase in wages pursuant to the new wages agreement finalized at Bhosari and Chakan and year-on-year salary hike. Employee cost as a percentage of net sales increased from 5.73% in Fiscal 2005 to 5.97 % in Fiscal 2006.

Manufacturing, Selling & Other Expenses

Manufacturing, selling and other expenses decreased by 0.33% from Rs. 400.65 million in Fiscal 2005 to Rs. 399.33 million in Fiscal 2006. Manufacturing, Selling and other expenses as a percentage of net sales decreased from 16.03% in Fiscal 2005 to 14.43 % in Fiscal 2006. The decrease was primarily on account of reduction in processing charges due to improved productivity.

Interest and Finance Charges

Interest and finance charges have increased by 40.49% from Rs.13.93 million in Fiscal 2005 to Rs. 19.57 million in Fiscal 2006. Interest and finance charges as a proportion of net sales

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increased from 0.56% in Fiscal 2005 to 0.71% in Fiscal 2006. The increase was mainly on account of drawal of term loans for expansion.

Depreciation and Amortization

Depreciation has increased by 7.87% from Rs.91.11 million in Fiscal 2005 to Rs. 98.28 million in Fiscal 2006.

Taxation

Current tax provision has increased by 440.38% from Rs.5.20 million in Fiscal 2005 to Rs. 28.10 million in Fiscal 2006.

In Fiscal 2005, there was a deferred tax expense of Rs. 19.81 million whereas in Fiscal 2006, there was a deferred tax credit of Rs. 4.30 million.

Effective tax rate has decreased from 38.37 % in Fiscal 2005 to 34.44% in Fiscal 2006. Effective tax rate is computed by taking into account current tax, deferred tax and fringe benefit tax.

Profit after Tax as per Audited statement of Accounts

Profit after Tax has increased by 15.60 % from Rs.40.18 million in Fiscal 2005 to Rs. 46.45 million in Fiscal 2006. Profit after Tax as a percentage of net sales has increased from 1.61% in Fiscal 2005 to 1.68 % due to all the aforementioned factors.

Net Profit after Tax as Restated

Restated Profit after Tax has decreased by 5.23% from Rs.42.42 million in Fiscal 2005 to Rs. 40.20 million in Fiscal 2006. Restated Profit after Tax as a percentage of net sales has decreased from 1.70% in Fiscal 2005 to 1.45% due to all the aforementioned factors. The audited financial statements have been restated on account of changes in the accounting policies and other material adjustments.

Fixed Assets including CWIP

Gross Fixed assets have increased by 3.78 % from Rs. 980.92 million in Fiscal 2005 to Rs. 1,017.97 million in Fiscal 2006. CWIP has increased by 38.09% from Rs. 108.38 million in Fiscal 2005 to Rs. 149.66 million in Fiscal 2006. However, net fixed assets including CWIP has decreased by 2.48% from Rs. 649.11 million in Fiscal 2005 to Rs. 633.04 million in Fiscal 2006 due to the full year impact of depreciation on fixed assets capitalized in the last quarter of Fiscal 2005.

Inventories

Though our net sales increased in Fiscal 2006 compared to Fiscal 2005, the inventory decreased by 8.16% from Rs. 344.85 million in Fiscal 2005 to Rs. 316.70 million in Fiscal 2006 primarily

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on account of decrease in the inventory turnover period from approximately 70 days in Fiscal 2005 to 57 days in Fiscal 2006.

Sundry Debtors

The debtors have increased by 25.97% from Rs.146.50 million in Fiscal 2005 to Rs. 184.55 million in Fiscal 2006 primarily on account of higher net sales and an increase in the collection period from approximately 21 days in Fiscal 2005 to approximately 24 days in Fiscal 2006. This increase in collection period is primarily due to withholding of the outstanding by the customers in view of price reduction negotiations with our Company.

Sundry Creditors

The creditors have decreased by 18.51% from Rs. 273.53 million in Fiscal 2005 to Rs. 222.91 million in Fiscal 2006. Payment period has decreased from approximately 40 days in Fiscal 2005 to approximately 30 days in Fiscal 2006. This decrease in payment period is primarily due to reduction in payment terms of the suppliers.

Liquidity and Capital Resources

Our primary liquidity needs have historically been to finance our capital expenditure programs and working capital needs. To fund these costs, we have relied on internal accruals and loan funds.

Cash Flows

The table below sets forth cash flow statement data of the Company as per its audited financial statements for the years ending March 31, 2005, 2006, 2007 and 2008: (Rs. in Mn) For the year ended Particulars 2008 2007 2006 2005 Net cash generated from operating activities 279.09 185.04 225.91 43.44 Net cash used in investing activities (541.81) (126.92) (76.23) (208.73) Net cash from/(used in) Financing activities 275.48 (153.36) (58.45) 171.06 Net increase/(decrease) in cash and cash 12.76 (95.24) 91.23 5.77 equivalents

Unusual or infrequent events or transactions

Except as described in the Draft Letter of Offer, there have been no other events or transactions that, to our knowledge, may be described as “unusual” or “infrequent”.

Significant economic changes

After the date of last financial statement, significant economic changes took place in the form of increase in fuel cost, hike in inflation rate and slowing down of economic growth. These trends,

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if continue, will have an adverse impact on the entire automotive component industry.

Know trends or uncertainties

Except as described in “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and in the Draft Letter of Offer, to our knowledge, there are no known trends or uncertainties that are expected to have a material adverse impact on our revenues or income from continuing operations.

Future relationship between cost and income

Except as described in “Risk Factors”, “Our Business” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations”, to our knowledge there are no known factors that will have a material adverse impact on our operations and finances.

Turnover for the industry segment in which we operate

The Indian Auto Component Industry achieved a turn over of Rs. 6,450 billion in Fiscal 2007.

New products or business segments

Except as described in “Objects of the Issue” and “Our Business”, we have no plans to introduce new products and enter into new business segment.

Seasonality of business

None of our products are seasonal in nature

Dependence on single or few suppliers / customers

As mentioned in “Risk Factors” and “Our Business”, we are predominantly dependent on Tata Motors Limited for sale of our products. We are a volume producer of sheet metal components, and therefore depend on bulk orders which are possible only through OEMs.

Further, on supply side also, we are significantly dependent on the top suppliers.

Competitive conditions

We have been strengthening our position in the business segments in which we operate. Most of the players in the sheet metal automotive component industry are in the unorganized sector with whom we compete.

Please, refer to “Our Business”, “Industry Overview” and “Risk Factors” on pages 64, 54 and ii respectively for further details on competition.

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Material Developments

1. Information as required by the Government of India, Ministry of Finance circular no. F2/5/SE/76 dated February 5, 1977 as amended vide their circular of even number dated March 8, 1977 based on the working results of the Company for the period from April 1, 2008 to May 31, 2008 is as follows:

(in Rs. Mn) Particulars Amt. Total Sales 553.84 Other Income 1.70 PBDIT (0.81) Interest (net of income) 8.87 Provision for Depreciation 22.32 Provision for Tax 10.48 Profit After Tax (21.52)

2. Save as stated elsewhere in the Letter of Offer, there are no material changes and commitments, which are likely to affect the financial position of the Company since March 31, 2008 (i.e. last date up to which audited information is incorporated in the Letter of Offer)

3. a) Week end prices of Equity Shares of the Company for the last four weeks on the BSE and NSE are as below:

Week Ended on Closing Rate BSE (Rs.) Closing Rate NSE (Rs.) July 4, 2008 46.00 50.00 June 27, 2008 52.00 51.35 June 20, 2008 57.80 60.00 June 13, 2008 63.60 65.50

Highest and Lowest Price of the Equity Shares of the Company for the last four weeks on the BSE and NSE are given below:

Stock Highest (Rs.) Date Lowest (Rs.) Date Exchange BSE 66.40 June 16, 2008 42.55 July 2, 2008 NSE 67.20 June 12, 2008 50.00 June 24, 2008

The current market price, i.e. the closing price on July 9, 2008 (one day before the Board Meeting to approve the Draft Letter of Offer) is as follows:

BSE : Rs. 50.00 NSE : Rs. 49.35

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SECTION VI: LEGAL AND OTHER INFORMATION

OUTSTANDING LITIGATIONS AND DEFAULTS

Except as described below, there are no outstanding litigation, suits or civil or criminal prosecution, proceedings including pending proceedings for violation of statutory regulations or alleging criminal or economic offences or tax liabilities against our Company, our Promoters, our Group Companies and our Directors that would have a material adverse effect on our business and that there are no defaults, non-payments or overdue of statutory dues, institutional/bank dues and dues payable to holders of debentures or fixed deposits and arrears of cumulative preference shares that would have a material adverse effect on our business.

I. Litigations involving our Company

Except for the criminal complaint filed against our Company, in relation to all litigations mentioned herein below, in case of an adverse ruling, our Company may be liable to pay the amount demanded/ decreed, if any, and amount deposited, if any, by our Company with the concerned authorities in this regard may be liable to be forfeited to the extent of the demand/ decree, if any.

A. Income Tax cases

1. The Company has challenged before the CIT (Appeals), the Order dated December 29, 2006 passed by the Assessing Officer u/s 143(3). The Assessing Officer in the said Order, in relation to Assessment Year 2004-05 has made additions /disallowances amounting to Rs. 37.38 Mn in the nature of (a) gain on prepayment of sales tax deferral loan treated as revenue receipt, (b) certain expenses on the repairs and maintenance of plant and machinery and software treated as capital expenditure.

Further, the Assessing Officer has also made an addition of Rs. 3.17 Mn to the book profit under Section 115JB of the Income Tax Act, 1961.

The case is pending at the office of CIT (Appeals).

We have already provided for the said liability in the books of accounts except for the tax impact on addition to book profit of Rs. 3.17 Mn. The likely tax impact on the same is Rs. 0.40 Mn.

2. The Company has filed Appeal before ITAT, Pune Bench, against the order of the Commissioner (Appeals) for upholding the disallowances/ the addition of Rs.85.42 Mn in the nature of gain on Prepayment of Sales Tax Deferral Loan treated as revenue receipt and part of communication expenses made by the Assessing Officer for the Assessment Year 2003- 04.

The case is pending before the ITAT.

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The Company has already provided for the said liability in the books of accounts.

3. The Company has filed Appeal before the Commissioner of Income Tax (Appeals) against the Order passed by the Assessing Officer disallowing certain expenses of Rs 2.14 Mn on the Repairs & Maintenance of Plant & Machinery and Software by treating them as Capital expenditure during the assessment year 2005-06.

The Assessing Officer has also made an addition of Rs. 1.66 Mn to the Book Profit on account of Provision for Doubtful Debts.

The Company has already provided for the said liability in the books of accounts except for the tax impact on addition to book profit of Rs. 1.66 Mn. The likely tax impact on the same is Rs. 0.13 Mn.

B. Central Excise Cases

1. The Company has filed an appeal before CESTAT, Mumbai bearing no E /2305/04 of 2005 against the Order of the Commissioner (Appeals) Central Excise, Pune. The Commissioner (Appeals) has by his order confirmed the levy of Penalty of Rs 0.015 Mn and Interest of approximately Rs 0.14 Mn there on. The Department had issued Show Cause Notice pertaining to undervaluation of free of cost material (sensor for fuel tank), not included in the Assessable Value. Duty has been paid by the Company.

2. The Commissioner Central Excise, Pune has filed an appeal against the Company before the CESTAT, Mumbai bearing no. E/3081/06 of 2006 demanding the levy of penalty as stated in the Show Cause Notice. Under the Show Cause Notice the Department had demanded Penalty and Interest for cenvat credit availed twice on same excise invoice during the period May 2001- September 2001. The Company has reversed the credit along with interest amount. The Penalty demanded is Rs 0.03 Mn.

3. The Commissioner Central Excise, Pune has filed an Appeal bearing No. E /2441/06 of 2006 against the Company before the CESTAT, Mumbai demanding the levy of penalty as stated in the Show Cause Notice. Under the Show Cause Notice, the Department had demanded Penalty and Interest on the duty allegedly evaded by the Company by undervaluing free of cost material (Steel Sheet or Blank), not included in the Assessable Value of the finished goods during the period April 2001-September 2004. Duty along with interest has already been paid by the Company. Penalty demanded is Rs 2.10 Mn.

4. The Company has filed an Appeal bearing No. E/3019/05-MUM before CESTAT, Mumbai against the Order passed by the Commissioner (Appeals), Vadodara, wherein the Commissioner (Appeals) had confirmed the demand of penalty and interest under the Show Cause Notice. The Company has sought waiver of penalty of Rs 0.23 Mn under the Order. Under the Show Cause Notice, the Department had demanded Penalty and Interest on the duty allegedly evaded by the Company by not adding the value of child part to ascertain the assessable value for one of the products manufactured for its clients in Fiscal 2002. The Company has already paid the duty, penalty and interest as demanded.

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5. The Company has filed an appeal before Commissioner (Appeals) Vadodara, against the Order of the Joint Commissioner Central Excise and Customs, Vadodara-II. The Joint Commissioner has by his Order confirmed the levy of duty of Rs 0.42 Mn and Penalty of Rs 0.42 Mn and Interest as may be applicable. The Department had issued Show Cause Notice alleging that the Company has not paid duty on goods sold under commercial invoices to a customer and not recorded the sale of CG -Tools & Fixtures to Customer in RG1 Register & has not shown the same in ER-1 returns.

6. The Company has filed an appeal before Commissioner (Appeals) Vadodara, against the Order of the Joint Commissioner Central Excise and Customs, Vadodara-II. The Joint Commissioner has by his Order confirmed the levy of duty of Rs 0.80 Mn and Penalty of Rs 1.25 Mn and Interest as may be applicable. The Department had issued Show Cause Notice with regards to: (a) inclusion of die amortization cost in respect of moulds, tools, die, etc. supplied free of cost by its customers & Chakan Unit. The Company has subsequently paid Duty & Education Cess aggregating to Rs. 0.13 Mn; (b) payment of duty & E.cess on M.S. Burr (Turning Scrap) aggregating to Rs. 0.04 Mn. The same has been subsequently paid by the Company; (c) Tools & Fixtures manufactured & sold to a customer on commercial invoices. Duty and Education Cess aggregating to Rs. 0.80 Mn is demanded under the Show Cause Notice; (d) Credit amounting to Rs. 0.1 Mn availed on service tax paid on outward transportation. The same has been subsequently reversed by the Company; (e) Goods sent for jobwork not received back within 180 days. Duty and Education Cess amounting to Rs.0.19 Mn has been subsequently paid by the Company.

C. Criminal Complaints

1. The Deputy Director – Industrial Safety & Health, Pune has filed a complaint in the Court of Chief Judicial Magistrate, Shivajinagar, Pune against the Mr. Raman Nanda, the then Occupier of the Company for prosecuting Mr. Nanda for the fatal accident occurred in the factory premises on January 18, 2006.

Under the Factories Act, 1948, the penalty/fine is upto Rs 0.10 Mn.

The Company has filed its Reply dated April 18, 2006 to Dy. Director I S & H on April 20, 2006. No claim has presently been made. The hearing is in progress.

D. Labour laws

1. There are 151 cases filed before the Labour Court, Vadodara and 4 cases before the Labour Court, Pune, by the employees employed by the Contractor [registered under the Contract Labour (Regulation and Abolition) Act, 1970] of the Company for re-instatement with back wages, recovery of wages aggregating to Rs 10.39 Mn. No specific financial claim has been

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quantified in respect of 20 cases filed before Labour Court, Vadodara and 4 cases filed before Labour Court, Pune.

2. Akhil Gujarat General Labour Union (Majdoor Sangh) has filed a case against the Company before the Assistant Labour Commissioner, Vadodara for claim of 20% Bonus, double overtime and leave with wages. The Assistant Labour Commissioner has sought approval of Labour Commissioner for making reference to the Labour Court.

3. Akhil Gujarat General Labour Union (Majdoor Sangh) has filed a case against the Company before the Labour Court, Vadodara, u/s 15(2) of the Payment of Wages Act 1936 for the alleged non payment of wages to the employees employed through the Contractor [registered under the Contract Labour (Regulation and Abolition) Act, 1970] by the Company on due date. Hearing is in progress.

II. Show Cause Notices received by the Company

The Company has received Show Cause Notices from various statutory and regulatory authorities. The brief note on the same is as follows:

A. Central Excise

1. The Assistant Commissioner of Central Excise, Pune-V, Division, Excise Bhavan, Dr Ambedkar Road, Akurdi Pune 411 044 has by his Show Cause Notice dated December 31, 2007 bearing F.N0. V (Dem) 15-134/Adj/07 calling upon the Company (Chakan Unit) to show cause as to why (a) The Cenvat credit and Education Cess amounting to Rs 0.23 Mn which should have been reversed by them, for the inputs not received within 180 days as detailed should not be demanded and the amount of Rs 0.23 Mn reversed later on should not be adjusted against the above demand; (b) the excess Cenvat credit availed amounting to Rs. 0.03 Mn should not be demanded and the amount already reversed should not be adjusted against the above demand; (c) the differential duty amounting to Rs 0.16 Mn short paid should not be demanded and the differential duty already paid should not be adjusted against the above demand. (d) Penalty should not be imposed; (e) Interest amount to Rs 0.03 Mn should not be recovered.

The Company has submitted its reply on February 27, 2008 and is pending for final hearing and disposal.

2. The Joint Commissioner Central Excise, Pune-I, has issued Show Cause Notice No. 99/P- V/BR-V/AE/JC/2006 to Our Company (Bhosari Unit) for imposing Interest & Penalty on account of undervaluing the value of free of cost material (sensor for fuel tank) not included in the Assessable Value during the period April, 2005 to October, 2005. The duty has been paid by the Company and the Show Cause Notice has been issued after payment of duty.

The Show Cause Notice has been replied on January 5, 2007 and is pending for final hearing and disposal.

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3. The Commissioner Central Excise, Pune I, has issued a Show Cause Notice No. 06/P- V/CKN/AE/COMMR/07 to Our Company (Chakan Unit) for imposing Interest & Penalty on account of: (a) receipt of blanks and dies and fixtures free of cost from a customer and non consideration of proportionate cost thereof in assessable value during the period May 2005- August 2006. Duty of Rs. 8.03 Mn has been subsequently paid by the Company; (b) Cenvat credit of Rs. 2.37 Mn availed by the Company for duty paid on scrap is inadmissible during the period June 2005 - December 2005. The Credit has been subsequently reversed by the Company; (c) Inadmissibility of Cenvat credit availed by the Company on duty paid on capital goods of Rs. 1.62 Mn. The Credit has been subsequently reversed by the Company.

Show cause notice was replied by the Company on March 22, 2007. Personal hearing is awaited. Penalty and Interest amounts have not been quantified in the Show Cause Notice.

4. The Commissioner Central Excise, Pune I, has issued a Show Cause Notice No. 48/PV/CKN/COMMR/06 to Company (Chakan Unit) for Duty, Interest and Penalty. The Show Cause Notice seeks to add the amount of gain on remission of Sales Tax Deferral Loan made during Fiscal 2003 and Fiscal 2004 in assessable value and demand the Excise Duty of Rs. 19.27 Mn along with interest on the duty not paid and penalty thereon. Reply has been submitted by the Company on June 01, 2006 to Commissioner of Central Excise, Pune I. Penalty and Interest amounts have not been quantified in the Show Cause Notice.

5. The Assistant Commissioner Central Excise, Division V, Pune, has issued a Show Cause Notice F.No. V(Dem)/15-8/ADJ/06-07/960 to the Company (Bhosari Unit) demanding Interest and Penalty on the grounds that the raw material / parts of capital goods sent outside for job-work were not received within 180 days during the period July 2002 - January 2005. The Company has already paid the Duty of Rs. 0.16 Mn. Interest and penalty is sought to be levied in the Show Cause Notice. The Company has submitted the Reply to the Show Cause Notice and is pending for final hearing and disposal. Amount of Interest and Penalty has not been quantified in the Show Cause Notice.

6. The Jt. Commissioner, Central Excise, Pune I, has issued Show Cause Notice no. 69/PV/CKN/AE/JC/06 to the Company (Chakan Unit) demanding Interest and Penalty on account of raw material / parts of capital goods sent outside for job-work not received back within 180 days. The Company has already paid the duty leviable of Rs. 0.67 Mn.

The company has filed its reply and the Show Cause Notice is pending for final hearing and disposal.

7. The Commissioner of Central Excise Pune-I has issued Show Cause Notice No. 20/PV/CKN/COMMR/08 to the Company (Chakan Unit) demanding excise duty of Rs. 16.47 Mn and Interest and Penalty under section 11AB & 11AC of the Central Excise Act, 1944. The Department has alleged that the Company has contravened the provisions of Section 4(1)(a), 11A(1) of Central Excise Act and Rule 6 of the Valuation Rules and Rules 4, 6 and 8 of the Central Excise Rules, 2002 in as much as the Company has not discharged its duty liability on the additional consideration received in form of gain on pre-payment of Sales Tax Deferral Loan and thereby short paid duty on the goods with intent to evade

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payment of duty. Reply has been submitted by the Company on May 1, 2008 to Joint Commissioner, Pune and the Show Cause Notice is pending for final hearing and disposal.

B. Customs Act

The Asst Commissioner of Customs, Monitoring Cell, Group VII, Mumbai has issued a Show Cause Notice vide F. No. S/16 BE (MC)-109/ 04 VII with regards to the Enforcement of bond for non-fulfillment of Export obligation undertaken by the Company along with applicable interest. The matter pertains to non – fulfillment of export obligation attached to advance license issued to the Company. The Company has already paid the duty liability with Customs and has applied for redemption of Advance License and Export Obligation Discharge Certificate. The Show Cause Notice has been replied on March 5, 2007 and is pending for final hearing and disposal.

C. Income Tax

1. The Income Tax Department has issued a Notice U/s 274 read with Section 271(1) (c) of the Income Tax Act, 1961, dated December 29, 2006 to the Principal Officer of the Company for imposing penalty for furnishing inaccurate particulars of income for the assessment year 2004-05. However, the above proceedings have not been proposed in respect of any specific disallowance / addition made in the Assessment. The Company has filed detailed submissions in the matter on March 27, 2007.

2. The Income Tax Department has issued a Show Cause Notice U/s 201 (1) dated July 2, 2008 to the Company seeking to hold it to be an Assesse in Default in respect of alleged short deduction of TDS u/s 194J and 194I of the IT Act. The show cause notice also proposes charging Interest u/s 201(1A) of the Income Tax Act 1961 on the amount of TDS short deducted.

D. Provident Fund

A Show Cause Notice for proceedings under Section 7-A of the Employees Provident Funds and Miscellaneous Provisions Act, 1952 has been issued by Assistant Provident Fund Commissioner vide Letter No. 31701/CIR/III/Regl. 142/118, dated April 27, 2006 alleging non payment of Provident fund contribution by the Company relating to employees employed by the contractor on building construction & scrap lifting work for period from January 2006 onwards. The amount has not been quantified in the Show Cause Notice. An inspection by the Officials of his office has taken place. His report of inspection is awaited.

E. SEBI

The adjudicating officer, SEBI issued Show cause notice No. A&E/BS/105841/2007 dated October 11, 2007 to the Company for instituting inquiry under Rule 4 of SEBI (Procedure for Holding Inquiry and Imposing Penalties by Adjudicating Officer) Rules, 1995 for delayed filing of certain disclosures under Regulations 6(2), 6(4) and 8(3) of the SEBI Takeover

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Regulations in the years 1997, 1999 and 2000.

The Show Cause Notice has been replied on October 30, 2007 stating that filing would have been made within the due date since the promoters' disclosures were received within required time period and are also available on record with the Company. The precise date of filing with the stock exchanges is not available for the said years, as the relevant records are not traceable. The records seem to be misplaced during the shifting of registered office from Delhi to Pune and Change in operating management of the Company in the year 2001. The Company has not received any further communication from SEBI thereafter.

III. Litigation by or against our Promoters

A. Tata AutoComp Systems Limited (TACO)

1. TACO has filed an appeal before the Sales Tax Tribunal against the order of Deputy Commissioner of Sales Tax against the Assessment Order (BST) for the period April 1, 2000 to March 31, 2001. Stay has been granted by Tribunal and TACO has paid Rs.0.80 Mn under protest out of the total disputed amount of Rs 9.11 Mn.

2. TACO has filed an appeal before the DC (Appeals), Pune-I against the order of Deputy Commissioner of Sales Tax in respect of the demand issued in the Assessment for the Assessment year 2001-02. TACO has paid Rs.1.5 Mn under protest out of the total disputed amount of Rs 2.75 Mn.

3. TACO has filed an appeal before the Commissioner of Central Excise (Appeals) against the Levy of service tax. TACO had received a Show Cause Notice demanding Rs 7.80 Mn along with the interest and penalty. TACO has made provision of about Rs. 9.48 Mn in the books of accounts and TACO has contested this claim.

4. TACO has filed an appeal before the Commissioner of Income Tax (Appeals) - XXXIII, Mumbai, against the order of assessing officer passed during the assessment for the assessment year 2004-05. the assessing officer has made certain disallowances / additions of Rs. 3.89 Mn. Notice of demand under section 156 of the IT Act with NIL demand has been received by TACO.

5. TACO has filed an appeal with the Commissioner of Income Tax (Appeals) - XXXIII, Mumbai, against the order of assessing officer passed during the Assessment for the Assessment year 2005-06. The assessing officer has made certain disallowances / additions of Rs. 171.86 Mn. TACO has received a demand notice of Rs 8.41 Mn from the assessing officer under section 115JB of the Income Tax Act, 1961.

6. TACO has filed a suit for infringement of trademark against G.S.Anand and another before Delhi High Court (Suit No. 423 of 2008) claiming damages of Rs. 2 Mn.

7. TACO has received various Show Cause Notices from the excise department aggregating to claims of Rs. 47.98 Mn.

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8. A dispute on certain terms of supply agreement dated December 23, 2004 between TACO and Dr. Schneider Kunstsoffwerke GmbH, Germany is pending resolution by arbitration before German Institute of Arbitration. While Dr. Schneider Kunstsoffwerke GmbH, Germany has made a claim for Euro 4.09 Mn against TACO, TACO has made a counter claim for Euro 3.25 Mn against the claimant.

B. Tata Industries Limited

1. There are no cases pending against TIL which would involve a financial liability if the matter is decided against TIL.

2. TIL has issued a notice to Grasim Industries Limited (representing the Birla Group) for initiating arbitration proceedings under the Indian Arbitration & Conciliation Act, 1996 on account of the Birla Group’s breaches of non compete and confidentiality clauses of the Shareholders’ Agreement dated December 15, 2000 in relation to IDEA Cellular Limited. While TIL has already communicated the name of the arbitrator nominated by it, the Birla Group failed to name its arbitrator. TIL had, therefore, filed an application in the Supreme Court of India under section 11(6) of the Indian Arbitration & Conciliation Act, 1996 seeking the appointment of an arbitrator on behalf of the Birla Group in order to commence the arbitration proceedings. The Supreme Court of India by its Order dated July 9, 2008 has allowed the Application filed by TIL and constituted the Arbitral Tribunal. The arbitration proceedings will commence in due course. TIL would draw up and submit its claim for losses/damages against Grasim Industries Limited, which is acting on behalf of the Birla Group.

3. Aditya Birla Nuvo Limited and Birla TMT Holdings Private Limited, which bought the entire shareholding of TIL and its overseas subsidiary in IDEA Cellular Limited under a share purchase agreement of June 1, 2006, have filed an application before the London Court of International Arbitration seeking a declaration that consequent to the divestment of their entire shareholding in IDEA Cellular Limited, TIL would be deemed to have given up its claims against the Birla Group and cannot, therefore, pursue the arbitration it had sought to commence.

IV. Litigation by and against our Group Companies

A. Tata Johnson Controls Automotive Limited (TJCL)

1. TJCL has filed an appeal bearing No. C.No.1V/16/33/2003/STC before the CESTAT, (Chennai) against the order of Commissioner (Appeals) confirming Demand of Service Tax on Royalty paid to JCI, Germany. The Service Tax involved is Rs 0.54 Mn.

2. TJCL has filed an appeal bearing Nos. 1762, 1808 and 1809 before the Sales Tax Tribunal, Mumbai against the demand of sales tax for the Fiscal 1998 and Fiscal 1999. The Tribunal has passed an order confirming the demand. Accordingly, TJCL has paid the sales

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tax amount aggregating to Rs. 7.14 Mn to Sales Tax authority. TJCL has filed reference application to the High Court. The total amount of claim involved is Rs 7.96 Mn.

3. TJCL has filed an appeal bearing ITA No. 341/PN/04/ and ITA No. 1418/PN/06 before the Income Tax Appellate Tribunal against order of Commissioner (Appeals) confirming the demand against the TJCL in the Assessment year 1997-98. The amount involved is Rs. 4.66 Mn.

B. TACO Faurecia Design Center Private Limited (TFDC)

TFDC has filed an appeal before the CIT (Appeals) against the demand notice raised by the assessing officer against TFDC for disallowances / additions during the assessment for assessment year 2004-05. Amount of tax demand on additions of income including surcharge, education cess and interest amounts to Rs. 0.24 Mn.

C. Tata Ficosa Automotive Systems Limited (TFASL)

TFASL has filed an appeal before the Joint Commissioner of Sales Tax (Appeal)- Pune Division against the assessment order- BST & CST -2002-03 of Deputy Commissioner of Sales Tax, Pune. Interim stay order has been received by the TFASL on April 30, 2008. The amounts involved are Rs 3.78 Mn in respect of CST; Rs 9.36 Mn in respect of BST.

D. Tata Yazaki Autocomp Limited (TYAL)

1. Labour Laws

a. There are 4 cases pending against TYAL filed before the Industrial Court, Pune, for reinstatement on permanent basis, after originally being appointed on temporary basis.

b. The Tata Yazaki Employees Union has filed a case bearing No. (ULP) NO.12/2007 before the Industrial Court, Maharashtra. The union has claimed the over time on Gross wages whereas TYAL’s policy is to pay overtime on double of the amount of basic plus special allowance. As the claim of the overtime amount is unreasonable, TYAL has filed a written statement in the said matter. c. Shubhangi Lande, one of the employees of TYAL, filed a case bearing no. (ULP) 43/2007 before the Labour Court No.2 at Pune against TYAL. TYAL had dismissed her after conducting an internal enquiry on her alleged fraudulent behavior. She challenged the dismissal on the grounds that the internal enquiry was not fair & proper. TYAL has filed written statement in the matter.

2. Excise Litigation a. The Development Commissioner SEEPZ- SEZ, Mumbai, has issued a Show Cause Notice bearing no.SEEPZ/ 28/EOU/43/2002-03 Vol II/3180 dated March 29, 2005 to TYAL to show cause as to why: 1. Letter Of Permission issued should not be cancelled. 2. DTA Sale

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permission issued should not be cancelled; 3. Penal action under Foreign Trade (Development & Regulation) Act should not be taken. TYAL has replied to the Show Cause Notice and is pending for final hearing. b. TYAL has filed a Writ Petition bearing No. 627/2008 before the Bombay High Court against the order of the Settlement Commission disallowing the abatement of Rs. 76.8 Mn and imposing the Interest @ 10% and levying Penalty of Rs.1.1 Mn, though the Immunity from prosecution was granted. The High Court has stayed the order of Settlement Commission vide its order dated February 28, 2008. Bank Guarantee has been submitted which is to be kept alive during the stay period and four weeks thereafter from the final order of High Court. Final hearing is not yet scheduled. Total Duty demanded in the matter is Rs.188.3 Mn. Payments made so far Rs.111.5 Mn. Balance due as per Show Cause Notice Rs.76.8 Mn. c. TYAL has filed an appeal before the CESTAT, Mumbai against the order passed by the Commissioner (Appeals) Pune. The Commissioner (Appeals) had confirmed the demand seeking to levy service tax on technical service charges and royalty. Stay has been granted by CESTAT. The duty in dispute is Rs. 1.66 Mn.

3. Income Tax related litigation

TYAL has filed an appeal (No. Pen 43/15/2006-07) before Commissioner of Income Tax (Appeals) against the order of the assessing officer in respect of assessment year 2004-05. TYAL has challenged the disallowance/ additions to income aggregating to Rs. 17 Mn.

TYAL has also received a Show Cause Notice from the Income Tax authorities alleging the said disallowance / additions to income as concealment of income / inaccurate filing of particulars in the return of income. TYAL has applied for keeping the matter of the Show Cause Notice in abeyance until final disposal of the appeal pending before Commissioner of Income Tax (Appeals).

E. TC Springs Limited (TCSL)

1. TCSL has filed an appeal before the CIT (Appeals) against the order of the assessing officer adding back apparent surplus on prepayment of net present value of deferred sales tax amounting to Rs. 9.95 Mn during the assessment for the assessment year 2003-04. Personal hearing for appeal is under progress. As TCSL has paid income tax on MAT under sec 115JB of the IT Act, tax impact will be on the losses carried forward.

2. TCSL has filed an appeal before the CIT (Appeals) against the order of the assessing officer for the assessment year 2005-06, adding back surplus on prepayment of net present value of deferred sales tax amounting to Rs 11.71 Mn and disallowance of certain expenses in the ordinary course of business. As TCSL has paid income tax on MAT under sec 115JB of the IT Act, tax impact will be on the losses carried forward.

F. Tata AutoComp GY Batteries Private Limited (TGY BATTERIES)

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TGY BATTERIES has filed an appeal before the Commissioner (Appeals), GATT Valuation Cell, Mumbai against the Order of the Assistant Commissioner of Customs wherein the valuation of imported items from foreign collaborator under section 14(1) of the Customs Act, 1962 read with Customs Valuation (Determination of Price of Imported Goods) Rules, 1988 was under dispute. The appeal is pending for final hearing. The amount involved is Rs 9.30 Mn

G. Tata Toyo Radiator Limited (TTRL)

1. TTRL has filed a suit bearing no. ULP 83/2006 before the Industrial Court, Pune against Krantikarak Majdur Sanghatana for Illegal Strike called by the Trade Union.

2. Krantikarak Majdur Sanghatana has filed a suit bearing no. ULP. 60/2006 before the Industrial Court, Pune against TTRL for Unfair Labour Practice of terminating, discharging the employees.

3. TTRL has filed a Reference Application ULP no. 1/2006 before the First Labour Court, Pune against Krantikarak Majdur Sanghatana for Illegal Strike called by the Trade Union.

4. Tata Toyo Employees Union has filed an Application for Recognition of Internal Union bearing no. MRTU. 13/2007 before the Industrial Court, Pune against TTRL for Recognition of that union by TTRL.

5. Mr. Roman Dias, an employee, of TTRL, has filed claim for gratuity against the TTRL of Rs 0.015 Mn at the Labour Office, Pune.

H. TACO Visteon Engineering Private Limited (TVEPL)

TVEPL has filed an appeal before the Commissioner of Income Tax (Appeals), Pune against the order passed by the Assessing Officer in the Assessment for the Assessment Year 2005- 06 wherein the Assessing officer has disallowed the expenses to the tune of Rs 0.12 Mn.

I. Tata Advanced Materials Limited (TAML)

1. U-Foam Pvt. Ltd. has filed a suit bearing no. 2625 of 2004 before the IV Senior Civil Judge’s Court, Hyderabad against TAML claiming outstanding dues (Principal and Interest) of Rs 0.47 Mn. TAML had engaged U-Foam and their sister concern X-Coat for installation of shelters in Andhra Pradesh.

2. TAML has filed an appeal before the Joint Commissioner of Commercial Taxes (Appeals), Bangalore against the assessing officer’s demand for tax at 12.5% for the assessment year 2003-04 on the grounds that TAML had executed works contracts for erection of shelters in Karnataka, Tamil Nadu and Andhra Pradesh for several years including assessment year 2003-04. In all other years and all the states the assessment was concluded at 4%, only in assessment year 2003-04. The amount in dispute is Rs.1.16 Mn.

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3. TAML has filed an appeal before the CESTAT against the order passed by the Commissioner of Excise (Appeals) Bangalore, wherein a suo motto Show Cause Notice has been issued to reverse the credit availed on the category of services availed by TAML. The amount in dispute is Rs 0.10 Mn.

4. TAML has filed an appeal before the CESTAT against the order of the Commissioner of Excise (Appeals) upholding the Demand of the Department directing TAML to reverse the credit taken by it since insurance claim was admitted by the Insurance Company. The said demand was confirmed by the excise authorities on the grounds that, TAML got the claims from insurance and replaced some of the assets which were destroyed due to a fire accident in the TAML. The amount involved is Rs. 0.06 Mn.

J. Technical Stampings Automotive Limited (TSAL)

1. TSAL has filed an appeal before CESTAT, Chennai (Appeal No. S/000027/2005) against the order of the Commissioner of Central Excise (Appeals) confirming the demand of service tax against TSAL aggregating to Rs. 24.36 Mn.

2. TSAL has filed an appeal before Commissioner of Income Tax (Appeals) against the order of assessing officer in respect of certain disallowances / addition to income for the assessment year 2002-03 aggregating to claim amount of Rs. 4.85 Mn.

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GOVERNMENT / STATUTORY, BUSINESS APPROVALS AND LICENCES

In view of the approvals listed below, we can undertake this Rights Issue and our current business activities and no further material approval are required from any Government authority or the RBI to continue such activities.

We have received the following Government approvals that are material to our business:

A. Pantnagar, Uttarakhand Unit

1. Certificate of Registration dated July 11, 2007 bearing no. 830505 for the factory at Pantnagar, Uttarakhand under section 69 of the Finance Act, 1994 in (a) Business Auxiliary Service & (b) Goods Transport Agency provided by the Company.

2. Letter of consent dated June 23, 2008 bearing No. HO/con/A-83/08/401 Dehradun, issued under Section 25/26 of The Water (Prevention and Control of Pollution) Act, 1974 and under section 21 of The Air (Prevention and Control of Pollution) Act, 1981 to operate the plant at Pantnagar, Uttarakhand. The consent is valid till March 31, 2009.

3. Certificate of Registration dated February 1, 2008 bearing no. U.S.N- 1155 issued under Factories Act, 1948, registering the factory at Pantnagar, Uttarakhand under the Factories Act 1948. The Licence is renewed upto December 31, 2008.

4. Certificate dated March 7, 2008 bearing no. FSR No. 1 issued by the Officer of Fire Safety, Udham Singh Nagar, certifying the arrangements made at Pantnagar, Uttarakhand for fire extinguishing are satisfactory.

5. Acknowledgement bearing no. No. 4856/SIA/IMO/2006 dated September 1, 2006 has been issued by Ministry of Commerce & Industry, Public Relation & Complaints Section, New Delhi acknowledging receipt of memorandum to manufacture the item - Pressing, Stamping and Roll Forming of Metal Powder Metallurgy with proposed capacity of 17000 MT at the plant located at Plot no.71 Sec 11, IIE, Pantnagar, Udham Singh Nagar.

6. Certificate of Registration dated January 15, 2007 bearing no. RU 5045236 issued under rule 5(1) of the Central Sales Tax (Registration and Turnover) Rules, 1957 registering the Company as a dealer under section 7(1)/7(2) of the Central Sales Tax Act, 1956 for the Factory at Pantnagar, Uttarankhand.

7. Certificate of Registration dated December 20, 2006 bearing No. 05006850747 issued under the Uttaranchal Value Added Tax Act, 2005 for the Factory at Pantnagar, Uttaranchal.

8. Letter dated January 31, 2007 bearing no.96/EDD(S) issued by Uttaranchal Power Corporation Ltd whereby electricity load has been sanctioned for the plant at Pantnagar.

9. No Objection Certificate dated December 20, 2007 bearing no. 4157 has been issued by Electrical Safety Inspector for the plant at Pantnagar for using electricity of 500 KVA

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10. By a Letter dated January 31, 2008, Plan Approval for the factory building is granted along with permission to use 362 H.P electricity and 20 H.P DG Set, by Joint Director, Labour Office.

11. Certificate of Registration dated April 26, 2008 bearing no. 260/08 issued under Rule 18(1) and section 7(2) of the Contract Labour (Regulation and Abolition) Act 1970 to the Company for appointing contractor ‘Gurudev Bahadur Labour Suppliers’.

12. The Company has been allotted Tax Deduction Account bearing no. MRTA02944E under the Income Tax Act, 1961.

13. Certificate of Registration dated April 4, 2007 bearing no. AAACJ2611MXM005 issued under the Central Excise Act, 1944 as a manufacturer.

B. Halol Unit

1. Certificate of Registration dated September 6, 1996 bearing no. BRD/ARIV/Ch. 87/205/96 issued under the Central Excise Act 1944 for the factory at Halol to cure/product/manufacture/carry on wholesale trade/ business/broker or commission agent or to obtain excisable goods, for special industrial purposes in respect of sheet metal components.

2. Acknowledgement dated September 2, 2003 bearing. No. 2472/SIA/IMO/2003 has been issued by Ministry of Commerce & Industry, Public Relation & Complaints Section, New Delhi for receipt of memorandum for the manufacture of following proposed item Forging, Pressing, Stamping and Roll Forming of Metal of Manufacture Powder Metallurgy for the existing capacity of 10000 MT for the plant at Survey No. 173. Vill. Khakharia, Ta. Savli, Dist. Vadodara.

3. Certificate of Registration bearing no. 3-34-344 and License No. 095756 issued under the Factories Act, 1948 for the factory at Halol under Rule 6 & 8 in Form 4, whereby the company has been registered under the Factories Act 1948. The registration is valid upto December 31, 2008.

4. Consent letter dated October 23, 2003, bearing No. 529 granting consent to the Company to operate the factory at Halol under section 26 of The Water (Prevention and Control of Pollution) Act 1974 and under section 21 of The Air (Prevention and Control of Pollution) Act 1981 and authorisation/renewal of authorisation under Rule 3(c) and Rule 5(5) of the Hazardous Water (Management and Handling) Rules, 1989. The consent was valid till March 31, 2008. The Company, by an application dated March 27, 2008, has applied for the renewal of the same.

5. Certificate of Registration dated July 15, 1997, bearing no. R315001497 issued under the Gujarat State Tax on Professions, Trades, Calling and Employment Act 1976 where under it has been registered as an employer.

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6. Certificate of Registration dated March 27, 1996, bearing no. ACL/BRD/CLA/CLR/337/96 issued under the Contract Labour (Regulation and Abolition) Act, 1970 for the factory at Halol.

7. Certificate dated November 29, 2001, for Central Excise Registration under Rule 9 of the Central Excise Rules, 2001 bearing Registration No. AAACJ2116M-XM-001 in respect of manufacturing of excisable goods for the Factory at Halol.

8. Certificate of Registration dated January 28, 2005 for Service Tax bearing no. GTA/VAD- II(City)/391/ASAL/2005 for the factory at Halol under section 69 of the Finance Act, 1994, by the Superintendent, Service Tax, Central Excise & Customs in respect of Goods Transport Agency.

9. Letter dated August 25, 2003 allotting Tax Deduction Account no. BRDA01343G for the factory at Halol.

10. Certificate of registration dated July 1, 2002, bearing no. 24192100315 issued by the Sales Tax Officer under the Gujarat Sales Tax Act, 1969, registering the factory at Halol as Manufacturer.

11. Certificate dated November 11, 2007 bearing no. 59961 for the Factory at Halol issued by Bureau Veritas Certification, certifying the Quality Management System is in accordance with requirements of ISO/TS 16949- Second Edition. The certificate is valid upto November 10, 2010.

12. Certificate of Registration dated September 30, 2005 bearing no. 24692100315 issued under rule 5(1) of the Central Sales Tax (Registration and Turnover) Rules, 1957 registering the Company as a dealer under section 7(1)/7(2) of the Central Sales Tax Act, 1956 for the Factory at Halol. The Certificate is valid from August 08, 1996 until cancelled.

13. The Company has been allotted Employees Provident Fund Organisation Establishment Code: GJ/BD/20936

14. Certificate of Stability dated April 25, 2008 has been issued by Adharshila Associates, Engineering, Financial and Management Associates to the Company for the factory at Halol, whereby the Engineer examined the various parts including the foundation with special reference to the machinery, plant etc that have been installed and reported that all the works of the engineering construction in the premises is/are structurally sound and that its/their stability will not be endangered by its/their use.

15. Form D as per the Payment of Bonus Act, 1965 has been duly submitted to the Labour Commissioner, Baroda for the year 2006-07 for the factory at Halol.

16. Examination of the lifting machines, ropes and lifting tackles for the factory located at 173, Khakaria, Savli, Halol, Vadodara.

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i. Examination done on December 30, 2007 by Dr. J.I. Nanavati PE of the machines. Next due date for examination is December 30, 2008 ii. Description: Fork Lift Truck, Voltas Make, Lift 4.12 Max, Hydraulic Operation iii. Examination done on December 30, 2007 by Dr. J.I. Nanavati PE of the machines. Next due date for examination is December 30, 2008 iv. EOT Crade, Federal Make, Lift 12 M

17. Certification for power presses dated June 30, 2007 has been issued by Dr. J I Nanavati PE for the machine mentioned below, whereby examination was carried out on machines. Description of Machine: i. Mechano Pneumatic Power Press, Sr. no. L121 ii. Mechano Pneumatic Power Press, Sr. no. SE4-600-108-72/28374 iii. Mechano Pneumatic Power Press, Sr. no. OP 5120 iv. Mechano Pneumatic Power Press, Sr. no. SE4-600-108-72/27780 v. Mechano Pneumatic Power Press, Sr. no. SE4-1000-108-96 vi. Mechano Pneumatic Power Press, Sr. no. S2-250-60-48 vii. Mechano Pneumatic Power Press, Sr. no. L122

18. Examination of pressure vessel or plant

i. Examination done on December 30, 2007 by Dr. J.I. Nanavati PE of the below mentioned machines.

ii. Description of machines: a. Air Compressor with Air Receiver b. Screw Compressor, Receiver Sr. no. 819119004 c. Vertical air receiver Sl.no. 1235

19. Annual Installation Inspection dated October 26, 2007 has been conducted by Electrical Inspector, Gujarat.

C. Units at Bhosari, Pune and Chakan, Pune

1. Certificate of Incorporation March 13, 1990 bearing no. 55-39494 issued by Asst. Registrar of Companies, Delhi & Haryana for incorporation of the Company as “JBM Tools Limited”. Fresh Certificate of Incorporation consequent to change of name dated August 1, 2003 has been issued by the Registrar of Companies, Pune for Change of Name of the Company from “JBM TOOLS LIMITED” to “AUTOMOTIVE STAMPINGS AND ASSEMBLIES LIMITED”.

2. Certificate of Commencement of Business dated September 14, 1990 has been issued by Registrar of Companies, Delhi & Haryana for commencement of business of the Company as “JBM Tools Limited”.

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3. Letter of consent dated January 4, 2007 bearing no. SROP-II/E-251/UP/CC/645/28 issued u/s 25/26 of the Water (Prevention and Control of Pollution) Act, 1974, u/s 21 of the Air (Prevention and Control of Pollution) Act, 1981 and authorization/renewal of authorization u/r 5 of the Hazardous Wastes (Management and Handling) & Amended Rules, 2000-2003 for plant at Gat No. 427, Juna Chakan, Medankarwadi, Tal. Khed, Pune, under which the consent is valid for Sheet metal components & welded sub assemblies 2400 MT/Month. The consent is valid upto December 31, 2009.

4. Acknowledgement dated December 26, 2007 bearing no. No. 3667/SIA/IMO/2007 has been issued by Ministry of Commerce & Industry, Public Relation & Complaints Section, New Delhi acknowledging the receipt of memorandum for the manufacture of item; in Pressing, Stamping and Roll Forming of Metal, Powder Metallurgy for the proposed capacity of 28520.00 MT, in addition to existing capacity of 36400.00 MT for the plant at Gat No. 427, Juna Chakan, Medankarwadi, Tal. Khed, Pune

5. Acknowledgement dated September 2, 2003 bearing no. No. 2473/SIA/IMO/2003 has been issued by Ministry of Commerce & Industry, Public Relation & Complaints Section, New Delhi acknowledging the receipt of memorandum for the manufacture of item - Forging, Pressing, Stamping and Roll Forming of Metal Powder Metallurgy for the existing capacity of 8000.00 MT at the plant located at G-71/2 MIDC, Bhosari, Pune.

6. Certificate bearing no. PNA/34-344/A-95 and License No. 081892 issued Rule 6 & 8 of the Factories Act 1948, registering the factory at MIDC, Bhosari, Pune, as a factory under the Factories Act, 1948. The Licence is renewed upto December 31, 2009.

7. Certificate of Registration bearing no. Pune/2(M)(1)34300 and License No. 086298 issued under Rule 6 & 8 of the Factories Act 1948 for the Plant at Chakan, Pune registering the factory under the Factories Act, 1948. The License is renewed upto December 31, 2008

8. Consent letter dated June 24, 2008 bearing Consent No. BO/PCI-II/RO-PN/EIC NO. PN- 2335-08/R/CC-479 issued by Maharashtra Pollution Control Board under section 26 of The Water (Prevention and Control of Pollution) Act, 1974 and under section 21 of The Air (Prevention and Control of Pollution) Act, 1981 and authorisation/renewal of authorisation under Rule 5 of the Hazardous Waste (Management and Handling) Rules, 1989 to operate the plant at MIDC, Bhosari, Pune. The consent is valid till February 28, 2009.

9. Certification dated February 7, 2007 bearing no. 46199 issued by Bureau Veritias Certification for the Factory at Chakan, Pune certifying the Quality Management System is in accordance with requirements of ISO/TS 16949- Second Edition. The validity of the same is till February 6, 2010.

10. Certificate dated February 7, 2007 bearing no 46200 issued by Bureau Veritias Certification for the Factory at MIDC, Bhosari, Pune certifying that the Quality Management System of the company is in accordance with requirements of ISO/TS 16949- Second Edition. The validity of the same is till February 6, 2010.

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11. Certificate dated September 29, 2007 bearing no. 217958 issued by Bureau Veritas Certification for the Factory at Chakan, Pune and MIDC, Bhosari, Pune certifying that the Management System of the company in accordance with requirements of ISO14001:2004 . The validity of the same is till August 14, 2010.

12. Certificate of Registration bearing no. PN No. 762, dated June 9, 2008, issued under Rule 20 read with section 7 of the Maharashtra Contract Labour (Regulation and Abolition) Rules, 1971. The certificate is for employing the following contract labour during the period January 1, 2008 to December 31, 2008 :-

Sl. Name of the Contractor Nature of work in Max No. Contract No. Contractor License No. contract labour is Labour expected to be employed in any day the employed on any day preceding 12 months through any contract 1 Sai Associates, 3177 Material Handing, House 225 Pune Keeping 2 Sai Samarth 4315 Cleaning, Material 20 Enterprises Handling 3 Nitin 4314 De-burring, cleaning, 125 Engineering material handling 4 Shree Ganesh NA Pallet Maintenance 3 Engineering fabrication Work 5 Unique Delta NA Security Service 10 Force Security Pvt Ltd

13. The Company, by an application dated October 31, 2007, has applied for the renewal of Certificate of Registration bearing No. 1225 issued under Rule 17(1) of the Contract Labour (Regulation and Abolition) Act, 1970. The application has been submitted to the Office of the Asst. Commissioner of Labour, Pune for the Chakan unit for the period January 1, 2008 to December 31, 2008. The application is made for employing the following contract labour :-

Sl. Name of the Nature of Work No. of Workmen Max. no of contract No. Contractor directly labour expected to employed by be employed on any Principal day through any Employer contract 1 Paramount Sevices, Job cleaning, 253 175 Pune Material Movements 2 Star Enterprises, Pune Material 253 250 Movements 3 Heavy Steel Works, Material Cleaning 253 50 Pune

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4 Sai Samarth Cleaning & 253 25 Sweeping, job work 5 Global Enterprises Grinding & 253 50 Buffing 6 Csons Enterprises Gardening 253 3 Plantation & Maintenance 7 Holkar Fabrication Fabrication 253 15 Engg 8 Sai Associates Job cleaning, 253 75 Material Movements 9 City Maintenance Forklift 253 17 Maintenance 10 PG Parbate Canteen service 253 20 11 Nitin Engineering Grinding & 253 75 Polishing 12 Forbes Facilities House Keeping 253 25 13 Shree Ganesh Fabrication 253 10 14 Poona Security Security 253 21 Investigation & Consultancy Services Pvt Ltd 15 Shinde Associates Construction 253 15

14. The Income Tax department has allotted the Company Permanent Account Number AAACJ2116M under the Income Tax Act, 1961.

15. Certificate dated February 14, 1997 bearing Registration No. 6893/97(33/9790/66) issued under section 1(3) of the Employees’ State Insurance Act, 1948 for its factory at MIDC, Bhosari, Pune.

16. “Provisional No Objection Certificate” dated March 29, 2008, bearing no. MIDC/FIRE/NOC/603 issued by Divisional Fire Officer, MIDC for the expansion /construction of Plant Building at Plot No. G - 71/2, MIDC, Bhosari, Pune. The validity of the certificate is 1 year.

17. Certificate of Service Tax Registration dated November 30, 2004, bearing no. STC/BAS/619/PI-04 issued under section 69 of the Finance Act, 1994 for the services provided from /availed by the factory at MIDC, Bhosari, Pune in respect of:

(a) Business Auxiliary Service (b) Goods Transport Agency

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18. Certificate of Service Tax Registration dated November 29, 2004, bearing no. STC/BAS/606/PI-04 issued under section 69 of the Finance Act, 1994 for the factory at Chakan, Pune in respect of:

(a) Business Auxiliary Service (b) Goods Transport Agency

19. Certificate of Registration dated August 20, 2003 bearing. No. AAACJ2116MXM003 issued under Rule 9 of the Central Excise Rules, 2002 in respect of manufacturing of excisable goods in the Factory at Chakan, Pune.

20. Central Excise Registration dated August 20, 2003 bearing no. AAACJ2116MXM004 issued under Rule 9 of the Central Excise Rules, 2002. in respect of manufacturing of excisable goods in the Factory at MIDC, Bhosari, Pune.

21. Certificate of Registration dated September 12, 1996 bearing no. 410501/S/330 issued under section 22/22A of the Bombay Sales Tax Act, 1959 for the factory at Chakan, Pune.

22. Certificate dated January 24, 1996 bearing No Octroi/7A/111/936 issued under the Rule 28 of taxation Rules, Chapter VIII of Scheduled Rules of Bombay Provincial Municipal Corporations Act, 1949 registering the Company under No.9903, whereby the company has been allowed to avail the facility of Octroi Current Account with Pimpri Chinchwad Municipal Corporation bearing account no. 1104.

23. Tax Deduction Account no. PNEA04701E for the factory at MIDC, Bhosari, Pune at and Chakan, Pune.

24. Certificate of Registration dated March 16, 1996 bearing no. 411026 C- 330 issued under Rule 5(1) of the Central Sales Tax (Registration and Turnover) Rules, 1957 registering the Company as a dealer under section 7(1)/7(2) of the Central Sales Tax Act, 1956 for the Factory at MIDC, Bhosari.

25. Certificate of Registration dated April 1, 2006 bearing no. 262786 and TIN No. 27980410010 C issued under rule 5(1) of the Central Sales Tax (Registration and Turnover) Rules, 1957 whereby the Company has been registered as a dealer under section 7(1)/7(2) of the Central Sales Tax Act, 1956 for the the Company, with principal place of business at MIDC, Bhosari, Pune 411026 and additional place of business at Juna Chakan, Medankarwadi, Pune 410501 and S. No. 173, Village Kharkharia, Tal. Savali, Vadodara, Halol.

26. Certificate of Registration – Cum - Membership bearing No. RCMC:B: MFG:1542:2001-02 issued by Engineering Export Promotional Council registering the Company as its member. The certificate was valid upto September 11, 2006.

27. Certificate of Registration dated April 1, 2006 bearing No. MH 01 V 388768 issued by Sales Tax Registration Officer allotting the Company TIN No. 27980410010V for the principal

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place of business at MIDC, Bhosari, Pune 411026 and additional place of business at Juna Chakan Medankarwadi, Pune 410501 under section 16 read with Rule 9 of the Maharashtra Value Added Tax Act, 2002.

28. A letter dated April 25, 2006 bearing no. SE/GKUC/T/HT-784/F.No.223/02881 issued by the Maharashtra State Electricity Distribution Co. Ltd, Pune granting permission for additional load in Contract Demand of 300 KVA in Connection Load of 825 KWA for the factory at MIDC, Bhosari, Pune.

29. Certificate of Registration bearing no. DT/R/2/2/7/8395 has been issued to the Company under the Maharashtra State Tax on Professions, Trades, Calling and Employment Act, 1975 where under it has been registered as an employer.

30. Certificate of Structural Stability dated April 19, 2007 has been issued to the Company by Structural Engineer, TCE Consulting Engineers Ltd for the expansion work of Press Shop Building at Chakan.

31. Certificate of Stability dated November 30, 2007 issued under Rule 3A of Factories Act, by Intertech Services to the effect that on examination of various parts, including foundation with special reference to the machinery, plant, etc. all the works of engineering construction in the premises at MIDC Bhosari is / are found structurally sound.

32. Certificate of Registration bearing establishment code 21CJ77665 has been issued by Welfare Commissioner under the Maharashtra Labour Welfare Fund to the Company for the factory at Chakan, Pune.

33. The Company has been allotted Establishment Code bearing No. MH/31701 under the Employment Provident Fund Organisation

34. An Application dated February 16, 2008 under the SMPV (U) Rules, 2002 has been made to the Joint Chief Controller of Explosives, Mumbai for the Renewal of License no. S/HO/MH/03/811(S5339) of the Company for the factory at Chakan for storage of Liquefied Carbon Dioxide in Vessel.

35. Letter dated May 2, 2006 issued by Chief Engineer (Electrical) informing the Registration of Generating Set for the factory at MIDC, Bhosari, Pune under Rule 4(i) of the Bombay Electricity Duty Rules, 1962.

Sl. Make Installed Thermal/ Purpose for Registration Date of No. Capacity Diesel which set No. Commencement installed 1 KOEL 320 KVA Diesel Industrial E/PN/706(i) 17.04.2006 2 KOEL 62.5 KVA Diesel Industrial E/PN/706 (ii) 17.04.2006

36. Certificate of Importer – Exporter Code dated November 13, 2007 bearing no. 31010088484 issued for different location:

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Branch Code 1: – GAT No. 427, Juna Chakan , Medankarwadi, Chakan, Pune. Branch Code 2:- SNO. 173, Vil. Khakharia, Tal. Savli, Vadodara, Halol, Gujarat. Branch Code 3:- G-71/2 MIDC, Bhosari, Pune Branch Code 4:- Plot no. 71, Sector 11 Pantnagar, Uttarakhand

37. A B Kharatmal, Competent Person for Renuka Enterprises by this report of examination of pressure plant/vessel and in the Form 13 prescribed under the Factories Act, 1948 has certified that pressure plant/vessel in the plant located at Chakan was thoroughly checked and were found satisfactory.

38. A B Kharatmal, Competent Person for Renuka Enterprises by this report of examination of lifting machines, rope and lifting tackles and in Form 12 prescribed under the Factories Act, 1948 has certified that lifting machines, ropes and lifting tackles in the plant located at Chakan were thoroughly tested and were found satisfactory.

39. A B Kharatmal, Competent Person for Excellent Safety Services by this report of examination of pressure plant/vessel and in Form 13 prescribed under the Factories Act, 1948 has certified that pressure plant/vessel in the plant located at Bhosari was thoroughly checked and were found satisfactory.

40. A B Kharatmal, Competent Person for Excellent Safety Services by this report of examination of lifting machines, ropes and lifting tackles and in Form 12 prescribed under the Factories Act, 1948 has certified that lifting machines, ropes and lifting tackles in the plant located at Bhosari were thoroughly tested and were found satisfactory.

41. Certificate of Registration dated December 19, 2007 bearing No. 8667 issued for weigh bridge under rule 16(3) of the Standards of Weights and Measures(Enforcement) Act, 1985 for the plant at Bhosari, Pune. The next date for the inspection under this rule is on 19th December, 2008.

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OTHER REGULATORY AND STATUTORY DISCLOSURES

Authority for the Issue

Pursuant to the resolution passed by the Board of Directors of the Company at its meeting held on January 17, 2008, it has been decided to make the Rights Issue to the Equity Shareholders of the Company.

Further in the same meeting, the Board has authorized the “Finance Committee” of the Board of Directors to take all steps required for the Rights Issue.

Prohibition by SEBI

Neither our Company, nor its Directors or the Promoters, or the Group Companies, or companies with which our Company’s Directors are associated with as directors or promoters, have been prohibited from accessing or operating in the capital markets under any order or direction passed by SEBI. Further, none of the directors or person(s) in control of the Promoters (as applicable) has been prohibited from accessing the capital market under any order or direction passed by SEBI.

Further, neither the Company, nor its Promoters, Group Companies or associate companies have been declared as wilful defaulters by RBI or any other governmental authority and there has been no violation of any securities law committed by any of them in past and no such proceedings are pending against them.

Eligibility for the Issue

Our Company is an existing company listed on Bombay Stock Exchange Limited and National Stock Exchange of India Limited. Our Company is eligible to offer this Rights Issue in terms of Clause 2.4.1 (iv) of the SEBI (Disclosure and Investor Protection) Guidelines, 2000 and amendments thereto (“SEBI Guidelines”).

Our Company has received ‘in-principle’ approval from Bombay Stock Exchange Limited and National Stock Exchange of India Limited where the Equity Shares offered through the Draft Letter of Offer are proposed to be listed vide their letters dated [●] and [●] respectively.

DISCLAIMER CLAUSE

AS REQUIRED, A COPY OF THE DRAFT LETTER OF OFFER HAS BEEN SUBMITTED TO SEBI. IT IS TO BE DISTINCTLY UNDERSTOOD THAT SUBMISSION OF THE DRAFT LETTER OF OFFER TO SEBI SHOULD NOT IN ANY WAY BE DEEMED OR CONSTRUED THAT THE SAME HAS BEEN CLEARED OR APPROVED BY SEBI. SEBI DOES NOT TAKE ANY

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RESPONSIBILITY EITHER FOR THE FINANCIAL SOUNDNESS OF ANY SCHEME OR THE PROJECT FOR WHICH THE ISSUE IS PROPOSED TO BE MADE OR FOR THE CORRECTNESS OF THE STATEMENTS MADE OR OPINIONS EXPRESSED IN THE DRAFT LETTER OF OFFER. THE LEAD MANAGER, YES BANK LIMITED HAS CERTIFIED THAT THE DISCLOSURES MADE IN THE DRAFT LETTER OF OFFER ARE GENERALLY ADEQUATE AND ARE IN CONFORMITY WITH SEBI (DISCLOSURES AND INVESTOR PROTECTION) GUIDELINES, 2000 IN FORCE FOR THE TIME BEING. THIS REQUIREMENT IS TO FACILITATE INVESTORS TO TAKE AN INFORMED DECISION FOR MAKING INVESTMENT IN THE PROPOSED ISSUE.

IT SHOULD ALSO BE CLEARLY UNDERSTOOD THAT WHILE THE ISSUER COMPANY IS PRIMARILY RESPONSIBLE FOR THE CORRECTNESS, ADEQUACY AND DISCLOSURE OF ALL RELEVANT INFORMATION IN THE OFFER DOCUMENT, THE LEAD MANAGER IS EXPECTED TO EXERCISE DUE DILIGENCE TO ENSURE THAT THE COMPANY DISCHARGES ITS RESPONSIBILITY ADEQUATELY IN THIS BEHALF AND TOWARDS THIS PURPOSE, THE LEAD MANAGER YES BANK LIMITED HAS FURNISHED TO SEBI A DUE DILIGENCE CERTIFICATE DATED JULY 10, 2008 WHICH READS AS FOLLOWS:

“1. WE HAVE EXAMINED VARIOUS DOCUMENTS INCLUDING THOSE RELATING TO LITIGATION LIKE COMMERCIAL DISPUTES, PATENT DISPUTES, DISPUTES WITH COLLABORATORS, ETC. AND OTHER MATERIALS MORE PARTICULARLY REFERRED TO IN THE ANNEXURE, IN CONNECTION WITH THE FINALIZATION OF THE DRAFT LETTER OF OFFER PERTAINING TO THE SAID RIGHTS ISSUE.

2. ON THE BASIS OF SUCH EXAMINATION AND THE DISCUSSIONS WITH THE COMPANY, ITS DIRECTORS AND OTHER OFFICERS, OTHER AGENCIES, INDEPENDENT VERIFICATION OF THE STATEMENTS CONCERNING THE OBJECTS OF THE ISSUE, PROJECTED PROFITABILITY, PRICE JUSTIFICATION AND THE CONTENTS OF THE DOCUMENTS MENTIONED IN THE ANNEXURE AND OTHER PAPERS FURNISHED BY THE COMPANY,

WE CONFIRM THAT:

(A) THE DRAFT LETTER OF OFFER FORWARDED TO SEBI IS IN CONFORMITY WITH THE DOCUMENTS, MATERIALS AND PAPERS RELEVANT TO THE ISSUE;

(B) ALL THE LEGAL REQUIREMENTS CONNECTED WITH THE SAID ISSUE AS ALSO THE GUIDELINES, INSTRUCTIONS, ETC. ISSUED BY SEBI, THE GOVERNMENT AND ANY OTHER COMPETENT AUTHORITY IN THIS BEHALF HAVE BEEN DULY

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COMPLIED WITH; AND

(C) THE DISCLOSURES MADE IN THE DRAFT LETTER OF OFFER ARE TRUE, FAIR AND ADEQUATE TO ENABLE THE INVESTORS TO MAKE A WELL-INFORMED DECISION AS TO THE INVESTMENT IN THE PROPOSED ISSUE AND SUCH DISCLOSURES ARE IN ACCORDANCE WITH THE REQUIREMENTS OF THE COMPANIES ACT, 1956, THE SEBI (DISCLOSURE AND INVESTOR PROTECTION) GUIDELINES, 2000 AND OTHER APPLICABLE LEGAL REQUIREMENTS

3. WE CONFIRM THAT BESIDES OURSELVES, ALL THE INTERMEDIARIES NAMED IN THE DRAFT LETTER OF OFFER ARE REGISTERED WITH SEBI AND THAT TILL DATE SUCH REGISTRATIONS ARE VALID.

4. WHEN UNDERWRITTEN, WE SHALL SATISFY OURSELVES ABOUT THE WORTH OF THE UNDERWRITERS TO FULFIL THEIR UNDERWRITING COMMITMENTS.

5. WE CERTIFY THAT WRITTEN CONSENT FROM SHAREHOLDERS HAS BEEN OBTAINED FOR INCLUSION OF THEIR SECURITIES AS PART OF PROMOTERS’ CONTRIBUTION SUBJECT TO LOCK-IN AND THE SECURITIES PROPOSED TO FORM PART OF PROMOTERS’ CONTRIBUTION SUBJECT TO LOCK-IN, WILL NOT BE DISPOSED / SOLD / TRANSFERRED BY THE PROMOTERS DURING THE PERIOD STARTING FROM THE DATE OF FILING THE DRAFT LETTER OF OFFER WITH SEBI TILL THE DATE OF COMMENCEMENT OF LOCK- IN PERIOD AS STATED IN THE DRAFT LETTER OF OFFER – NOT APPLICABLE.

6. WE CERTIFY THAT CLAUSE 4.6 OF THE SEBI (DISCLOSURE AND INVESTOR PROTECTION) GUIDELINES, 2000, WHICH RELATES TO SECURITIES INELIGIBLE FOR COMPUTATION OF PROMOTERS CONTRIBUTION, HAS BEEN DULY COMPLIED WITH AND APPROPRIATE DISCLOSURES AS TO COMPLIANCE WITH THE CLAUSE HAVE BEEN MADE IN THE DRAFT LETTER OF OFFER – NOT APPLICABLE.

7. WE UNDERTAKE THAT CLAUSES 4.9.1, 4.9.2, 4.9.3 AND 4.9.4 OF THE SEBI (DISCLOSURE AND INVESTOR PROTECTION) GUIDELINES, 2000 SHALL BE COMPLIED WITH. WE CONFIRM THAT ARRANGEMENTS HAVE BEEN MADE TO ENSURE THAT PROMOTERS’ CONTRIBUTION AND SUBSCRIPTION FROM ALL FIRM ALLOTTEES WOULD BE RECEIVED AT LEAST ONE DAY BEFORE THE OPENING OF THE ISSUE .WE UNDERTAKE THAT AUDITORS’

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CERTIFICATE TO THIS EFFECT SHALL BE DULY SUBMITTED TO THE BOARD. WE FURTHER CONFIRM THAT ARRANGEMENTS HAVE BEEN MADE TO ENSURE THAT PROMOTERS’ CONTRIBUTION SHALL BE KEPT IN AN ESCROW ACCOUNT WITH A SCHEDULED COMMERCIAL BANK AND SHALL BE RELEASED TO THE COMPANY ALONG WITH THE PROCEEDS OF THE PUBLIC ISSUE – NOT APPLICABLE.

8. WE CERTIFY THAT THE REQUIREMENTS OF PROMOTER’S CONTRIBUTION ARE NOT APPLICABLE TO THE ISSUER COMPANY UNDER CLAUSE 4.1 0.1.

9. WE CERTIFY THAT THE PROPOSED ACTIVITIES OF THE ISSUER FOR WHICH THE FUNDS ARE BEING RAISED IN THE PRESENT ISSUE FALL WITHIN THE ‘MAIN OBJECTS’ LISTED IN THE OBJECT CLAUSE OF THE MEMORANDUM OF ASSOCIATION OR OTHER CHARTER OF THE ISSUER AND THAT THE ACTIVITIES WHICH HAVE BEEN CARRIED OUT UNTIL NOW ARE VALID IN TERMS OF THE OBJECT CLAUSE OF ITS MEMORANDUM OF ASSOCIATION.

10. WE CONFIRM THAT NECESSARY ARRANGEMENTS WILL BE MADE TO ENSURE THAT THE MONEYS RECEIVED PURSUANT TO THE ISSUE ARE KEPT IN A SEPARATE BANK ACCOUNT AS PER THE PROVISIONS OF THE SECTION 73(3) OF THE COMPANIES ACT, 1956 AND THAT SUCH MONEYS SHALL BE RELEASED BY THE SAID BANK ONLY AFTER PERMISSION IS OBTAINED FROM THE DESIGNATED STOCK EXCHANGE AS MENTIONED IN THE DRAFT LETTER OF OFFER. WE FURTHER NOTE THAT THE AGREEMENT TO BE ENTERED INTO BETWEEN THE BANKERS TO THE ISSUE AND THE ISSUER SHALL SPECIFICALLY CONTAIN THIS CONDITION.

11. WE CERTIFY THAT NO PAYMENT IN THE NATURE OF DISCOUNT, COMMISSION, ALLOWANCE OR OTHERWISE SHALL BE MADE BY THE ISSUER OR THE PROMOTERS, DIRECTLY OR INDIRECTLY, TO ANY PERSON WHO RECEIVES SECURITIES BY WAY OF FIRM ALLOTMENT IN THE ISSUE – NOT APPLICABLE.

12. WE CERTIFY THAT A DISCLOSURE HAS BEEN MADE IN THE DRAFT LETTER OF OFFER THAT THE INVESTORS SHALL BE GIVEN AN OPTION TO GET THE SHARES IN DEMAT OR PHYSICAL MODE.

13. WE CERTIFY THAT THE FOLLOWING DISCLOSURES HAVE BEEN MADE IN THE DRAFT LETTER OF OFFER:

(A) AN UNDERTAKING FROM THE ISSUER THAT AT ANY GIVEN TIME THERE SHALL BE ONLY ONE DENOMINATION FOR THE

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SHARES OF THE COMPANY

(B) AN UNDERTAKING FROM THE ISSUER THAT IT SHALL COMPLY WITH SUCH DISCLOSURE AND ACCOUNTING NORMS SPECIFIED BY SEBI FROM TIME TO TIME.”

THE FILING OF OFFER DOCUMENT DOES NOT, HOWEVER, ABSOLVE THE COMPANY FROM ANY LIABILITIES UNDER SECTION 63 OR 68 OF THE COMPANIES ACT, 1956 OR FROM THE REQUIREMENT OF OBTAINING SUCH STATUTORY OR OTHER CLEARANCES AS MAY BE REQUIRED FOR THE PURPOSE OF THE PROPOSED ISSUE. SEBI, FURTHER RESERVES THE RIGHT TO TAKE UP, AT ANY POINT OF TIME, WITH THE LEAD MANAGER ANY IRREGULARITIES OR LAPSES IN OFFER DOCUMENT.

CAUTION

Our Company and the Lead Manager accept no responsibility for statements made otherwise than in the Draft Letter of Offer or in the advertisements or any other material issued by or at the instance of the Company and that anyone placing reliance on any other source of information would be doing so at their own risk.

All information shall be made available by the Lead Manager and the Issuer to the shareholders and no selective or additional information would be made available for a section of the shareholders or investors in any manner whatsoever including at presentations, research or sales reports etc after filing the Draft Letter of Offer with SEBI. In addition, the Lead Manager and the Company are also obliged to update the Offer Document and keep the public informed of any material changes till the listing and trading commencement of the Equity Shares offered through this Issue.

DISCLAIMER WITH RESPECT TO JURISDICTION

The Draft Letter of Offer has been prepared under the provisions of Indian Law and the applicable rules and regulations there under. The distribution of the Draft Letter of Offer and the offering of the securities on a rights basis to persons in certain jurisdictions outside India may be restricted by the legal requirements prevailing in those jurisdictions. Persons into whose possession the Draft Letter of Offer may come are required to inform themselves about and observe such restrictions. Any disputes arising out of this Issue will be subject to the jurisdiction of the appropriate court(s) in Pune, India only.

United States Restrictions

NEITHER THE RIGHTS ENTITLEMENTS NOR THE EQUITY SHARES THAT MAY BE PURCHASED PURSUANT THERETO HAVE BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY U.S. STATE SECURITIES LAWS, AND MAY NOT BE OFFERED, SOLD, RESOLD OR OTHERWISE TRANSFERRED WITHIN THE UNITED STATES OF AMERICA OR THE 221

TERRITORIES OR POSSESSIONS THEREOF (THE “UNITED STATES” OR THE “U.S.”) OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, “US PERSONS” (AS DEFINED IN REGULATION S UNDER THE SECURITIES ACT (“REGULATION S”)), EXCEPT IN A TRANSACTION EXEMPT FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. THE RIGHTS REFERRED TO IN THIS LETTER OF OFFER ARE BEING OFFERED IN INDIA, BUT NOT IN THE UNITED STATES. THE OFFERING TO WHICH THIS LETTER OF OFFER RELATES IS NOT, AND UNDER NO CIRCUMSTANCES IS TO BE CONSTRUED AS, AN OFFERING OF ANY SHARES OR RIGHTS FOR SALE IN THE UNITED STATES OR AS A SOLICITATION THEREIN OF AN OFFER TO BUY ANY OF THE SAID SHARES OR RIGHTS. ACCORDINGLY, THIS LETTER OF OFFER SHOULD NOT BE FORWARDED TO OR TRANSMITTED IN OR INTO THE UNITED STATES AT ANY TIME, EXCEPT IN A TRANSACTION EXEMPT FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. NEITHER THE COMPANY NOR ANY PERSON ACTING ON BEHALF OF THE COMPANY WILL ACCEPT SUBSCRIPTIONS FROM ANY PERSON, OR THE AGENT OF ANY PERSON, WHO APPEARS TO BE, OR WHO THE COMPANY OR ANY PERSON ACTING ON BEHALF OF THE COMPANY HAS REASON TO BELIEVE IS, A RESIDENT OF THE UNITED STATES AND TO WHOM AN OFFER, IF MADE, WOULD RESULT IN REQUIRING REGISTRATION OF THIS LETTER OF OFFER WITH THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION. THE COMPANY IS INFORMED THAT THERE IS NO OBJECTION TO A UNITED STATES SHAREHOLDER SELLING ITS RIGHTS IN INDIA. RIGHTS MAY NOT BE TRANSFERRED OR SOLD TO ANY U.S. PERSON.

Designated Stock Exchange

The Designated Stock Exchange for the purposes of this Issue will be the [•].

Disclaimer Clauses of Bombay Stock Exchange Limited

The Bombay Stock Exchange Limited (“The Exchange”) has pursuant to its letter no. [●] dated [●], given its permission to the Company to use the Exchange’s name in the Draft Letter of Offer as one of the stock exchanges on which the Company’s securities issued in terms of this Issue are proposed to be listed. The Exchange has scrutinized the Draft Letter of Offer for their limited internal purpose of deciding on the matter of granting the aforesaid permission to this Company. The Exchange does not in any manner:

• warrant, certify or endorse the correctness or completeness of any of the contents of the Draft Letter of Offer; or warrant that the Company’s securities will be listed or will continue to be listed on the Exchange; or take any responsibility for the financial or other soundness of the Company, its Promoters, its management or any scheme or project of the Company

• and it should not for any reason be deemed or construed that the Draft Letter of Offer has been cleared or approved by the Exchange. Every person who desires to apply for or otherwise acquires any securities of this Company may do so pursuant to independent inquiry, investigation and analysis and shall not have any claim 222

against the Exchange whatsoever by reason of any loss which may be suffered by such person consequent to or in connection with such subscription or acquisition whether by reason of anything stated or omitted to be stated herein or for any other reason whatsoever.

Disclaimer Clauses of National Stock Exchange of India Limited

As required, a copy of the Draft Letter of Offer has been submitted to National Stock Exchange of India Limited (“NSE”). NSE has vide its letter dated [•] given permission to the Issuer to use the Exchange’s name in the Draft Letter of Offer as one of the Stock Exchanges on which the Issuer’s securities are proposed to be listed. The Exchange has scrutinized the Draft Letter of Offer for its limited internal purpose of deciding on the matter of granting the aforesaid permission to the Issuer. It is to be distinctly understood that the aforesaid permission given by NSE should not in any way be deemed or construed that the Draft Letter of Offer has been cleared or approved by NSE; nor does it in any manner warrant, certify or endorse the correctness or completeness of any of the contents of the Draft Letter of Offer; nor does it warrant that the Issuer’s securities will be listed or will continue to be listed on the Exchange; nor does it take any responsibility for the financial or other soundness of the Issuer, its Promoters, its management or any scheme or project of the Issuer.

Every person who desires to apply for or otherwise acquire any securities of the Issuer may do so pursuant to independent inquiry, investigation and analysis and shall not have any claim against the Exchange whatsoever by reason of any loss which may be suffered by such person consequent to or in connection with such subscription/ acquisition whether by reason of anything stated or omitted to be stated herein or any other reason whatsoever.

Filing of Draft Letter of Offer

As required, a copy of the Draft Letter of Offer has been filed with SEBI, SEBI Bhavan, Plot No. C-4A, G Block, Bandra Kurla Complex, Bandra (East), Mumbai– 400 051 for its observation. The Draft Letter of Offer has also filed with the Bombay Stock Exchange Limited and the National Stock Exchange of India Limited at Mumbai for their observations. All the legal requirements applicable till the date of filing the Draft Letter of Offer with the Stock Exchanges have been complied with.

Listing

The existing equity shares of the Company are listed on Bombay Stock Exchange Limited, and National Stock Exchange of India Limited. Our Company has received ‘in- principle’ approval from Bombay Stock Exchange Limited, and The National Stock Exchange of India Limited for listing of Equity Shares arising from this Issue vide their letters dated [●] and [●] respectively. Our Company will make applications to the stock exchanges for permission to deal in and for an official quotation in respect of the Equity Shares arising from this Issue.

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If the permission to deal in and for an official quotation of the Equity Shares is not granted by the stock exchanges mentioned above, within 42 days of the Issue Closing Date, our Company shall forthwith repay, without interest, all monies received from the applicants in pursuance of the Draft Letter of Offer. If such money is not repaid within eight days after our Company becomes liable to repay it (i.e. 42 days after closure of the Issue), then our Company and every director of our Company who is an officer in default shall, on and from expiry of eight days, be jointly and severally liable to repay the money, with interest as prescribed under subsections (2) and (2A) of section 73 of the Act.

Impersonation

Attention of the applicants is specifically drawn to the provisions of sub-section (1) of section 68A of the Companies Act, 1956 which is reproduced below:

“Any person who makes in a fictitious name, an application to a company for acquiring or subscribing for, any shares therein, or otherwise induces a company to allot, or register any transfer of shares therein to him, or any other person in a fictitious name, shall be punishable with imprisonment for a term which may extend to five years.”

Dematerialized dealing

The Company, for its existing Equity Shares bearing the ISIN INE900C01027, has entered into

• tripartite agreement dated April 18, 2007 with National Securities Depository Limited (NSDL) and Intime Spectrum Registry Limited; and

• tripartite agreement dated March 20, 2007 with the Central Depository Services (India) Limited and Intime Spectrum Registry Limited

Consents

Consents in writing of the Auditors, Lead Manager, Legal Advisors, Registrar to the Issue, Banker to the Issue and Bankers to the Company to act in their respective capacities have been obtained and the same will be filed with the Designated Stock Exchanges at the time of filing the Letter of Offer with them. Such consents have not been withdrawn up to the time of delivery of the Draft Letter of Offer for registration with the stock exchange.

M/s Price Waterhouse, Chartered Accountants, the Auditors of our Company have given their written consent for the inclusion of their Report in the form and content as appearing in the Draft Letter of Offer and such consents and reports have not been withdrawn up to the time of delivery of the Draft Letter of Offer for registration with the stock exchange.

M/s Price Waterhouse, Chartered Accountants, Auditors have given their written consent for inclusion of income tax benefits in the form and content as appearing in the Draft 224

Letter of Offer, accruing to our Company and its members. To the best of our Company’s knowledge there are no other consents required for making this Issue. However, should the need arise, necessary consents shall be obtained by our Company.

Expert Opinion, if any

No expert opinion has been obtained by our Company.

Expenses of the Issue

The expenses of the Issue payable by our Company including fees and reimbursement to the Lead Manager, Registrar, printing and distribution expenses, publicity, listing fees, stamp duty and other expenses are estimated at around [●] % of the gross proceeds of the Rights Issue and will be met out of the proceeds of the Issue.

Fees Payable to the Lead Manager to the Issue

The fees payable to the Lead Manager to the Issue will be as stated in the Memorandum of Understanding entered into by our Company with YES Bank Limited, copy of which is available for inspection at the Registered Office of our Company and reimbursement of their out of pocket expenses.

Fees Payable to the Registrar to the Issue

The fee payable to the Registrar to the Issue is as set out in the relevant documents, copies of which are kept open for inspection at the Registered Office of our Company and reimbursement of their out of pocket expenses.

Underwriting commission, brokerage and selling commission

No Underwriting arrangement has been made by us as on the date of this Draft Letter. There will be no brokerage and selling commission.

Other Expenses of the Issue

Please refer to the paragraph “Issue Expenses” under “Objects of the Issue” beginning on page 27 of the Draft Letter of Offer.

Details of Public/Rights Issues made during the last three years by companies under the same Management within the meaning of section 370(1 B) of the Act

Nil

Promise vs Performance

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The details of the previous issues of securities made by the Company are as follows:

(i) Initial Public Offer by the Company

The Company made an Initial Public Offer of its equity shares during the Fiscal 1994. The Company issued 2,534,800 equity shares of Rs. 10 each at par. The Issue being the fresh issue of 2,534,800 equity shares by the Company through a prospectus dated February 3, 1994.

The proceeds of the issue were applied for the objects of the issue as disclosed in the Prospectus for the issue, i.e. the Company is setting up manufacturing facility at Faridabad, Haryana for the manufacture of sheet metal components with an installed capacity of 3500 tpa at plot no. 133, Sector 24, Faridabad (Haryana). There were no deviations from the objects on which the issue proceeds were utilized.

Projections vs. Actual (in comparison to prospectus issued at the time of public issue in February, 1994)

(Rs. in mn except per share data) Projections Actual Total Income 115.90 242.32 Profit After Tax 10.30 35.05 Earnings per Share (EPS) (Rs. per share) 3.23 10.95

(ii) Rights issue of Fully Convertible Debentures

The Company offered for subscription on a rights basis 15% 25,60,000 fully convertible debentures of Rs 75 each for cash aggregating to Rs 19,20,00,000 The issue opened on July 22, 1996 and closed on August 20, 1996. The object of the issue was to part finance the cost of the Company’s expansion of manufacture of Sheet Metal Components from 3,500 tpa to 25,000 tpa by setting up new units at Pune and Halol and expansion of the existing unit at Faridabad. Certain additional machines were also proposed to be installed at the tool room at its existing location at Faridabad. The amount raised from the Issue of fully convertible debentures by the Company was deployed for the aforesaid objects of the issue.

Projections vs. Actual

The comparison of actual with the projections as made in the letter of offer for the rights issue of 2,560,000 fully convertible debentures by the Company in July, 1996 is given below:

(Rs. in mn except per share data) 1996-97 1997-98 1998-99 Particulars Projections Actual Projections Actual Projections Actual Total Income 509.90 493.36 931.20 419.10 1,021.40 649.80 Profit After Tax 45.90 50.07 62.90 12.10 91.40 (47.19)

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Listed Ventures of Promoters

Nil

Outstanding Debentures, Bonds and Preference Shares

Except as disclosed in “Capital Structure” on page 19 of the Draft Letter of Offer, our Company does not have any outstanding Debentures, Bonds or Preference shares.

Stock Market Data for Equity Shares of our Company

Our Company is an existing company listed on Bombay Stock Exchange Limited, and The National Stock Exchange of India Limited.

The high and low closing prices recorded on the BSE for the preceding three years and the number of Equity Shares traded on the days the high and low prices were recorded is stated below:

Year High Date of Volume Low Date of Volume Average ending (Rs.) High on date (Rs.) Low on date price March of high of low for the 31 (no. of (no. of year shares) shares) (Rs.) 2008 123.20 May 24, 23,816 46.10 March 42,765 87.92 2007 24, 2008 2007 123.85 April 7, 3,196 60.05 July 25, 12 88.07 2006 2006 2006 146.80 January 70,725 66.50 May 3, 13,322 113.11 16, 2006 2005 (Source: BSE Website)

The high and low prices and volume of Equity Shares traded on the respective dates, on BSE, during the last six months is as follows:

Month, High Date of Volume Low Date of Volume Average Year (Rs.) High on date (Rs.) Low on date price of high of low for the (no. of (no. of month shares) shares) (Rs.) June, 2008 66.40 June 16, 150 46.35 June 30, 1,088 57.47 2008 2008 May, 2008 75.00 May 5, 5,367 60.55 May 26, 761 66.63

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Month, High Date of Volume Low Date of Volume Average Year (Rs.) High on date (Rs.) Low on date price of high of low for the (no. of (no. of month shares) shares) (Rs.) 2008 2008 April, 2008 70.95 April 22, 1,897 53.20 April 1, 247 62.42 2008 2008 March, 79.15 March 3, 2,069 46.10 March 42,765 60.42 2008 2008 24, 2008 February, 94.90 February 5,073 72.55 February 3,716 80.84 2008 6, 2008 13, 2008 January, 117.95 January 27,862 73.00 January 2,077 98.23 2008 18, 2008 22, 2008 (Source: BSE Website)

Note: In the event the high and low price of equity shares are the same on more than one day, the day on which there has been higher volume of trading has been considered for the purposes of this section

The closing price of the shares on BSE on January 18, 2008, the day after the Board of Directors approved the rights issue was Rs. 106.90.

The high and low closing prices recorded on the NSE for the preceding three years and the number of Equity Shares traded on the days the high and low prices were recorded is stated below:

Year High Date of Volume Low Date of Volume Average ending (Rs.) High on date (Rs.) Low on date price for March of high of low the year 31 (no. of (no. of (Rs.) shares) shares) 2008 119.90 January 27,334 45.00 March 2,120 87.84 16, 2008 24, 2008 2007 123.00 April 7, 2,725 60.65 July 25, 702 88.07 2006 2006 2006 146.60 January 57,305 70.00 April 20, 2,603 113.07 16, 2006 2005 (Source: NSE Website)

The high and low prices and volume of Equity Shares traded on the respective dates, on NSE, during the last six months is as follows:

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Month, High Date of Volume Low Date of Volume Average Year (Rs.) High on date (Rs.) Low on date price of high of low for the (no. of (no. of month shares) shares) (Rs.) June, 67.20 June 12, 569 50.00 June 24, 1,482 59.57 2008 2008 2008 May, 71.95 May 5, 715 60.00 May 26, 1,080 65.55 2008 2008 2008 April, 74.00 April 16, 1,556 53.00 April 7, 1,779 62.32 2008 2008 2008 March, 81.00 March 4, 1,599 45.00 March 2,120 60.53 2008 2008 24, 2008 February, 89.40 February 1,778 64.05 February 1,820 80.30 2008 4, 2008 25, 2008 January, 119.90 January 27,334 75.00 January 930 98.90 2008 16, 2008 22, 2008 (Source: NSE Website)

The closing price of the shares on NSE on January 18, 2008, the day after the Board of Directors approved the rights issue was Rs. 108.70.

Mechanism Involved For Redressal of Investor Grievances

Correspondence received from the shareholders is received either at the Registered Office of the Company or at the Office of the Registrars & Share Transfer Agent.

The correspondence received at the Registered Office of the Company is promptly replied if it pertains to requests like furnishing of financial results/ annual report, reply to queries on Financials, etc. The correspondence related to matters handled by Registrar & Transfer Agent is sent to them for the necessary action.

The Company has dedicated an E-mail ID exclusively for handling of investors’ / shareholders’ correspondence, grievances and complaints. E-mails on this E-mail ID are checked on daily basis and appropriate action is taken immediately.

The Shareholders Grievance and Compliance Committee is constituted by the Board of Directors. Mr. Ramesh A. Savoor is the Chairman of the committee. Mr. S. Ramakrishnan and Mr. Rameshwar S. Thakur are the other members of the committee.

The Terms of Reference for the committee include inter alia specifically to look into the redressing of Shareholders’ and investors’ complaints like non-receipt of Balance Sheet, non-

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receipt of declared Dividends, non-receipt of share certificates upon transfer of shares, Demat Credit etc. The Committee is empowered to operate in terms of the provisions of the Listing Agreement and / or the provisions as prescribed under the Companies Act 1956 and other related Regulations.

The average time taken for processing share transfer requests including despatch of share certificates is 25 days, while it takes a minimum of 7 days for processing dematerialization requests. The Registrars and our Company regularly monitor and supervise the functioning of the system so as to ensure that there are no delays or lapses in the system. The average time taken by the Registrars for attending routine grievances is 5 days from the date of receipt. In case of non-routine grievances where verifications by the other agency are involved, it is the endeavour of the Registrars to attend to them as expeditiously as possible. Our Company undertakes to resolve its investors’ grievances in a time bound manner.

Our Company’s investors’ grievances arising out of this Issue will be handled by the Registrar to the Issue, Intime Spectrum Registry Limited situated at C-13, Pannalal Silk Mills Compound, LBS Road, Bhandup (West), Mumbai 400 078. All grievances relating to the Issue may be addressed to the Registrars to the Issue giving full details such as Folio No., name and address of the first applicant, number of Equity Shares applied for, application form serial number, amount paid on application and the Bank Branch Form serial number where the application was deposited, along with a photo copy of the acknowledgement slip. In case of renunciation, the same details of the renouncee should be furnished.

Our Company has also appointed Mr. Shailendra Dindore, its Company Secretary as Compliance Officer who can be contacted in case of any pre-Issue/ post-Issue related problems. To the best of our knowledge, the name of our Company has not appeared in the Press Release issued by SEBI relating to maximum number of investor complaints received during the last three months.

Mechanism Involved For Redressal of Investor Grievances of Group Companies

All our Group Companies are closely held unlisted companies and therefore no formal mechanism for redressal of investor grievances is required.

Changes in the Auditors during the last three years

There has been no change in Statutory Auditors of our Company during the last three years.

Capitalisation of reserves or profits

Our Company has not capitalized any of its reserves or profits for the last five years.

Revaluation of assets, if any

Our Company has not revalued its assets in the last five years preceding the date of the Draft Letter of Offer.

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Important

• This Issue is pursuant to the resolution passed by the Board of Directors at its meetings held on January 17, 2008.

• This Issue is applicable to those Equity Shareholders whose names appear as beneficial owners as per the list to be furnished by the depositories in respect of the Equity Shares held in the electronic form and on the Register of Members of the Company at the close of business hours on the Record Date i.e. [•], after giving effect to the valid share transfers lodged with the Company upto the Record Date i.e. [•].

• Your attention is drawn to “Risk Factors” appearing on page ii of the Draft Letter of Offer.

• Please ensure that you have received the Composite Application Form (“CAF”) with the Letter of Offer.

• Please read the Draft Letter of Offer and the instructions contained therein and in the CAF carefully before filling in the CAF. The instructions contained in the CAF are each an integral part of the Letter of Offer and must be carefully followed. An application is liable to be rejected for any non-compliance of the provisions contained in the Letter of Offer or the CAF.

• All enquiries in connection with the Letter of Offer or CAF should be addressed to the Registrar to the Issue, quoting the Registered Folio number/ DP and Client ID number and the CAF numbers as mentioned in the CAF.

• All information shall be made available to the Investors by the Lead Manager and the Issuer, and no selective or additional information would be available by them for any section of the Investors in any manner whatsoever including at road shows, presentations, in research or sales reports, etc.

• The Lead Manager and the Company shall update the Draft Letter of Offer and keep the public informed of any material changes till the listing and trading commences.

Issue Programme

The subscription list will open at the commencement of banking hours and will close at the closure of banking hours on the date mentioned below or such extended date (subject to maximum of 60 days) as may be determined by the Board of Directors of our Company.

Issue Opens on: Issue Closes on: Last date for receiving request for split forms:

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Allotment Letters / Refund Orders

The Company will issue and dispatch letters of allotment/ share certificates/ demat credit and/or letters of regret along with refund order or credit the allotted securities to the respective beneficiary accounts, if any, within a period of 42 days from the date of closure of the Issue. If such money is not repaid within eight days from the day the Company becomes liable to pay it, the Company shall pay that money with interest as stipulated under section 73 of the Companies Act. The Board of Directors declares that funds against this Issue will be transferred to a separate bank account other than the bank account referred to in sub-section (3) of section 73 of the Act.

Applicants residing at 68 centres where clearing houses are managed by the Reserve Bank of India (RBI), will get refunds through ECS only (Electronic Clearing Service) except where Applicants are otherwise disclosed as applicable/eligible to get refunds through direct credit, NEFT and RTGS.

In case of those Applicants who have opted to receive their Rights Entitlement in dematerialized form using electronic credit under the depository system, and advice regarding their credit of the Equity Shares shall be given separately. Applicants to whom refunds are made through electronic transfer of funds will be sent a letter through ordinary post intimating them about the mode of credit of refund within 42 working days of closure of the Issue.

In case of those Applicants who have opted to receive their Rights Entitlement in physical form and the Company issues Letter of Allotment, the corresponding share certificates will be kept ready within three months from the date of allotment thereof or such extended time as may be approved by the Companies Law Board under section 113 of the Companies Act or other applicable provisions, if any. Allottees are requested to preserve such letters of allotment, which would be exchanged later for the share certificates. For more information please refer to “Allotment/Refund” on page 247 of the Draft Letter of Offer.

The letter of allotment / refund order exceeding Rs.1,500 would be sent by registered post/speed post to the sole/first Applicant's registered address. Refund orders up to the value of Rs.1,500 would be sent under certificate of posting. Such refund orders would be payable at par at all places where the applications were originally accepted. The same would be marked ‘Account Payee only’ and would be drawn in favour of the sole/first Applicant. Adequate funds would be made available to the Registrar to the Issue for this purpose.

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SECTION VII: ISSUE RELATED INFORMATION

TERMS OF THE ISSUE

The Equity Shares, now being issued, are subject to the terms and conditions contained in the Draft Letter of Offer, the enclosed Composite Application Form (“CAF”), the Memorandum and Articles of Association of the Company, approvals from the RBI, the provisions of the Companies Act, guidelines issued by SEBI, guidelines, notifications and regulations for issue of capital and for listing of securities issued by Government of India and/or other statutory authorities and bodies from time to time, terms and conditions as stipulated in the allotment advice or letter of allotment or security certificate and rules as may be applicable and introduced from time to time.

Authority for the Issue

This Issue is being made pursuant to the resolution passed by the Board of Directors of the Company under section 81(1) of the Companies Act at its meeting held on January 17, 2008.

Basis for the Issue

The Equity Shares are being offered for subscription for cash to those existing Equity Shareholders whose names appear as beneficial owners as per the list to be furnished by the depositories in respect of the Equity Shares held in the electronic form and on the register of members of the Company in respect of Equity Shares held in the physical form at the close of business hours on the Record Date, i.e., [●] fixed in consultation with the Stock Exchanges.

The Equity Shares are being offered for subscription in the ratio of [●] Equity Shares for every [●] Equity Shares held by the Equity Shareholders.

Ranking of Equity Shares

The Equity Shares allotted pursuant to this Issue, subject to the Memorandum and Articles of Association of the Company and the Companies Act, 1956, shall rank pari-passu in all respects with the existing Equity Shares of the Company, including dividend payment.

Mode of Payment of Dividend

We shall pay dividend to our shareholders as per the provisions of the Companies Act.

Principal Terms and Conditions of the Issue

Face Value

Each Equity Share shall have the face value of Rs. 10.

Issue Price

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Each Equity Share is being offered at a price of Rs. [●] (including a premium of Rs. [●]).

Rights Entitlement Ratio

As your name appears as beneficial owner in respect of Equity Shares held in the electronic form or appears in the register of members as an Equity Shareholder of the Company as on [●] i.e. Record Date. You are entitled to the number of Equity Shares as set out in Part A of the enclosed CAF.

The Equity Share are being offered on a rights basis to the existing Equity Shareholders of the Company in the ratio of [●] Equity Shares for every [●] Equity Shares held as on the Record Date. Only upon receipt of the aforesaid details, Rights Entitlement of the claimants shall be determined.

Rights of the Equity Shareholder

Subject to applicable laws, the Equity Shareholders shall have the following rights:

• Right to receive dividend, if declared; • Right to attend general meetings and exercise voting powers, unless prohibited by law; • Right to vote on a poll either in person or by proxy; • Right to receive offers for rights shares and be allotted bonus shares, if announced; • Right to receive surplus on liquidation; • Right of free transferability of shares; and • Such other rights, as may be available to a shareholder of a listed public company under the Companies Act and our Memorandum and Articles of Association.

Market Lot

The market lot for the Equity Shares in dematerialized mode is one. In case of physical certificates, the Company would issue one certificate for the Equity Shares allotted to one folio (“Consolidated Certificate”).

Minimum Subscription

If the Company does not receive the minimum subscription of 90% of the Issue Size, the Company shall forthwith refund the entire subscription amount received within 42 days from the date of closure of the Issue. If there is a delay beyond eight days after the date from which the Company becomes liable to pay the amount, the Company shall pay interest for the delayed period as prescribed under section 73 of the Companies Act.

The Issue will become undersubscribed after considering the number of Equity Shares applied as per entitlement plus additional Equity Shares. The undersubscribed portion shall be applied for only after the Issue Closing Date. In the event of undersubscription, TACO intends to apply for

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additional Equity Shares such that at least 90% of the Issue is subscribed. As a result of this subscription and consequent allotment, TACO may acquire Equity Shares over and above their entitlement in the Issue, which may result in an increase of the shareholding being above the current shareholding with the entitlement of Equity Shares under the Issue. This subscription and acquisition of additional Equity Shares by TACO, if any, will not result in change of control of the management of the Company and shall be exempt in terms of proviso to Regulation 3(1)(b)(ii) of the SEBI Takeover Code. As such, other than meeting the requirements indicated in “Objects of the Issue” on page 27 of the Draft Letter of Offer, there is no other intention/purpose for this Issue, including any intention to delist the Company, even if, as a result of allotments to TACO, in this Issue, the shareholding of TACO in the Company exceeds their current shareholding. TACO intends to subscribe to such unsubscribed portion as per the relevant provisions of the law. The above is subject to the terms mentioned under “Basis of Allotment” on page 246 of the Draft Letter of Offer.

Fractional entitlements

For Equity Shares being offered on rights basis under this Rights Issue, if the shareholding of any of the Equity Shareholders is less than [●] Equity Shares or is not in multiples of [●], the fractional entitlement of such holders shall be ignored.

Shareholders whose fractional entitlements are being ignored would be given preferential allotment of ONE additional Equity Share each if they apply for additional Equity Shares.

Those Equity shareholders having holding less than [●] Equity Shares and therefore entitled to zero Equity Shares under the Right Issue shall be despatched a CAF with zero entitlement. Such Equity Shareholders are entitled to apply for additional Equity Shares. However, they cannot renounce the same to third parties. CAF with zero entitlement will be non-negotiable /non- renunciable.

Joint-Holders

Where two or more persons are registered as the holders of any Equity Shares, they shall be deemed to hold the same as joint-holders with benefits of survivorship subject to provisions contained in the Articles of Association of the Company.

Terms of payment

Full amount of Rs. [●] shall be payable on application.

Where an Applicant has applied for additional Equity Shares and is allotted lesser number of Equity Shares than applied for, the excess application money paid shall be refunded. The monies would be refunded within forty two days from the closure of the Issue, and if there is a delay beyond eight days from the stipulated period, the Company will pay interest on the monies in terms of section 73 of the Companies Act.

Nomination facility

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In terms of section 109A of the Companies Act, nomination facility is available in case of Equity Shares. The Applicant can nominate any person who is not an excluded U. S. Person as defined in Regulation S under the U.S. Securities Act of 1933, as amended, by filling the relevant details in the CAF in the space provided for this purpose.

A sole Equity Shareholder or first Equity Shareholder, along with other joint Equity Shareholders being individual(s) may nominate any person(s) who, in the event of the death of the sole holder or all the joint-holders, as the case may be, shall become entitled to the Equity Shares. A person, being a nominee, becoming entitled to the Equity Shares by reason of the death of the original Equity Shareholder(s), shall be entitled to the same advantages to which he would be entitled if he were the registered holder of the Equity Shares. Where the nominee is a minor, the Equity Shareholder(s) may also make a nomination to appoint, in the prescribed manner, any person to become entitled to the Equity Share(s), in the event of death of the said holder, during the minority of the nominee. A nomination shall stand rescinded upon the sale of the Equity Share by the person nominating. A transferee will be entitled to make a fresh nomination in the manner prescribed. When the Equity Share is held by two or more persons, the nominee shall become entitled to receive the amount only on the demise of all the holders. Fresh nominations can be made only in the prescribed form available on request at the registered office of the Company or such other person at such addresses as may be notified by the Company. The Applicant can make the nomination by filling in the relevant portion of the CAF.

Only one nomination would be applicable for one folio. Hence, in case the Shareholder(s) has already registered the nomination with the Company, no further nomination needs to be made for Equity Shares to be allotted in this Issue under the same folio. However, new nominations, if any, by the Equity Shareholder(s) shall operate in super session of the previous nomination, if any.

In case the allotment of Equity Shares is in dematerialized form, there is no need to make a separate nomination for the Equity Shares to be allotted in this Issue. Nominations registered with respective depository participant of the Applicant would prevail. If the applicant requires to change the nomination, they are requested to inform their respective DP.

Offer to Non-Resident Equity Shareholders / Applicants

Applications received from NRIs and non-residents for Allotment of Equity Shares shall be inter alia, subject to the conditions imposed from time to time by the RBI under the Foreign Exchange Management Act, 2000 (FEMA) in the matter of receipt and refund of application moneys, allotment of Equity Shares, issue of letter of allotment / share certificates, payment of interest, dividends, etc. General permission has been granted to any person resident outside India to purchase Equity Shares offered on a rights basis by an Indian company in terms of FEMA and regulation 6 of notification No. FEMA 20/2000-RB dated May 3, 2000. However, the general permission referred to in the sentence immediately above is subject to the restrictions described below under “No Offer in the United States”. The Board of Directors may at its absolute discretion, agree to such terms and conditions as may be stipulated by RBI while approving the allotment of Equity Shares, payment of dividend etc. to the non-resident Shareholders. The

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Equity Shares purchased on a rights basis by non-residents shall be subject to the same conditions including restrictions in regard to the repatriability as are applicable to the original Equity Shares against which Equity Shares are issued on a right basis. By virtue of Circular No. 14 dated September 16, 2003 issued by the RBI, overseas corporate bodies (“OCBs”) have been derecognized as an eligible class of investors and the RBI has subsequently issued the Foreign Exchange Management (Withdrawal of General Permission to Overseas Corporate Bodies (OCBs)) Regulations, 2003. Accordingly, OCBs shall not be eligible to subscribe to the Equity Shares. The RBI has however clarified in its circular, A.P. (DIR Series) Circular No. 44, dated December 8, 2003 that OCBs which are incorporated and are not under the adverse notice of the RBI are permitted to undertake fresh investments as incorporated non-resident entities. Thus, OCBs desiring to participate in this Issue must obtain prior approval from the RBI. Such approval shall be submitted along with the CAF.

The Letter of Offer and CAF shall only be dispatched to non-resident Equity Shareholders with registered addresses in India. The Letter of Offer and CAF should not be forwarded to or transmitted in or into the United States of America or the territories or possessions thereof at any time or to, or for the account or benefit of, “U.S. Persons” (as defined in Regulation S under the United States Securities Act of 1933, as amended), except in a transaction exempt from the registration requirements of the Securities Act.

No Offer in the United States

The rights and the Equity Shares of the Company have not been and will not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”), or any U.S. state securities laws and may not be offered, sold, resold or otherwise transferred within the United States or to, or for the account or benefit of, “U.S. Persons” (as defined in Regulation S under the Securities Act), except in a transaction exempt from the registration requirements of the Securities Act. The rights referred to in the Draft Letter of Offer are being offered in India but not in the United States of America. The offering to which the Draft Letter of Offer relates is not, and under no circumstances is to be construed as, an offering of any shares or rights for sale in the United States of America, or the territories or possessions thereof, or as a solicitation therein of an offer to buy any of the said shares or rights. Accordingly, the Draft Letter of Offer should not be forwarded to or transmitted in or into the United States of America at any time except in a transaction exempt from the registration requirements of the Securities Act. Neither the Company nor any person acting on behalf of the Company will accept subscriptions from any person, or the agent of any person, who appears to be, or who the Company or any person acting on behalf of the Company has reason to believe is, a resident of the United States of America and to whom an offer, if made, would result in requiring registration of the Draft Letter of Offer with the United States Securities and Exchange Commission.

The Company is informed that there is no objection to a United States shareholder selling its rights in India. Rights may not be transferred or sold to any U.S. Person (as defined in Regulation S under the Securities Act).

Procedure for Application

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The CAF would be printed in blue ink for all Shareholders. Additional separate advice for Non- resident Shareholders will be provided. In case the original CAF is not received by the Applicant or is misplaced by the Applicant, the Applicant may request the Registrar to the Issue, Intime Spectrum Registry Limited, for issue of a duplicate CAF, by furnishing the registered folio number, DP ID Number, Client ID Number and their full name and address. Non-resident Shareholders can obtain a copy of the CAF from the Registrar to the Issue, Intime Spectrum Registry Limited by furnishing the registered folio number, DP ID number, Client ID number and their full name and address. Equity Shares offered to you can be renounced either in full or in part in favour of any other person or persons. Such Renouncees can only be Indian Nationals/Limited Companies incorporated under and governed by the Act, statutory corporations/institutions, trusts (unless registered under the Indian Trust Act), minors (through their legal guardians), societies (unless registered under the Societies Registration Act, 1860 or any other applicable laws) provided that such trust/society is authorized under its constitution/bye laws to hold equity shares in a company and cannot be a partnership firm, more than three persons including joint holders, HUF, foreign nationals (unless approved by RBI or other relevant authorities) or to any person situated or having jurisdiction where the offering in terms of the Draft Letter of Offer could be illegal or require compliance with securities laws.

Option to Subscribe

Applicants to the Equity Shares of the Company issued through this Right Issue shall be allotted the securities in dematerialized (electronic) form at the option of the Applicant. Our Company signed a tripartite agreement with National Securities Depository Limited (NSDL) and Intime Spectrum Registry Limited on April 18, 2007 and with Central Depository Services (India) Limited (CDSL) and Intime Spectrum Registry Limited on March 20, 2007, which enables the Investors to hold and trade in securities in a form, instead of holding the securities in the form of physical certificates.

Utilization of Issue Proceeds

The Board declares that:

(a) The funds received against this Issue will be transferred to a separate bank account other than the bank account referred to sub-section (3) of section 73 of the Companies Act.

(b) Details of all moneys utilized out of the Issue shall be disclosed under an appropriate separate head in the balance sheet of the Company indicating the purpose for which such moneys has been utilized.

(c) Details of all such unutilized moneys out of the Issue, if any, shall be disclosed under an appropriate separate head in the balance sheet of the Company indicating the form in which such moneys have been invested.

The funds received against this Issue will be kept in a separate bank account and the Company will not have any access to such funds unless it satisfies the Designated Stock Exchange with suitable documentary evidence that the minimum subscription of 90% of the Issue has been

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received by the Company.

Undertakings by the Company

1. The complaints received in respect of the Rights Issue shall be attended to by the company expeditiously and satisfactorily.

2. The all steps for completion of the necessary formalities for listing and commencement of trading at all stock exchanges where the securities are to be listed are taken within 7 working days of finalisation of basis of allotment.

3. The funds required for making refunds to unsuccessful applicants as per the modes disclosed in the Draft Letter of Offer/Letter of Offer shall be made available to the Registrar to the Issue.

4. Where refunds will be made through electronic transfer of fund, a suitable communication shall be sent to the applicant within 42 days of closure of the Issue giving details of the bank where refunds shall be credited along with the amount and expected date of electronic transfer of fund.

5. The certificates of the securities/ refund orders to the non-resident Indians shall be dispatched within the specified time.

6. No further issue of securities shall be made till the securities issued/ offered through the captioned Rights Issue are listed or till the application moneys are refunded on account of non-listing, under-subscription etc.

Composite Application Form

The CAF consists of four parts:

Part A: Form for accepting the Equity Shares offered and for applying for additional Equity Shares Part B: Form for renunciation Part C: Form for application for renouncees Part D: Form for request for split application forms

How to Apply?

Resident Equity Shareholders

Applications should be made only on the enclosed CAF provided by the Company. The enclosed CAF should be completed in all respects, as explained in the instructions indicated in the CAF. Applications will not be accepted by the Lead Manager or by the Registrar to the Issue or by the Company at any offices except in the case of postal applications as per instructions given in the Draft Letter of Offer.

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Non-resident Equity Shareholders

Applications received from the Non-Resident Equity Shareholders for the Allotment of Equity Shares shall, inter alia, be subject to the conditions as may be imposed from time to time by the RBI, in the matter of refund of application moneys, Allotment of Equity Shares, issue of letters of Allotment/ certificates/ payment of dividends etc.

Non-resident Equity Shareholders will be required to represent, inter alia, that they are not excluded U.S. Persons as such term is defined in Regulation S under the U.S. Securities Act of 1933, as amended.

Option available to the Equity Shareholders

The Equity Shareholders will be having the following five options:

(a) Apply for his entitlement in part (b) Apply for his entitlement in part and renounce the other part (c) Renounce his entire entitlement (d) Apply for his entitlement in full (e) Apply for his entitlement in full and apply for additional Equity Shares

Acceptance of the Issue

You may accept the Issue and apply for the Equity Shares offered, either in full or in part by filling Part A of the enclosed CAF and submit the same along with the application money payable to the Bankers to the Issue at any of the branches as mentioned on the reverse of the CAF before the close of the banking hours on or before the Issue Closing Date or such extended time as may be specified by the Board in this regard. Applicants at centers not covered by the branches of collecting banks can send their CAF together with the cheque drawn on a local bank at Mumbai or demand draft/pay order payable at Mumbai to the Registrar to the Issue by registered post. Such applications sent to anyone other than the Registrar to the Issue are liable to be rejected.

Renunciation

As an Equity Shareholder, you have the right to renounce your entitlement for the Equity Shares in full or in part in favour of one or more person(s). Your attention is drawn to the fact that the Company shall not allot and/or register any Equity Shares in favour of:

• More than three persons including joint holders; • Partnership firm(s) or their nominee(s); • Minors; • Hindu Undivided Family; and

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• Any Trust or Society (unless the same is registered under the Societies Registration Act, 1860 or any other applicable Trust laws and is authorized under its Constitutions to hold Equity Shares of a Company)

The right of renunciation is subject to the express condition that the Board of Directors shall be entitled in its absolute discretion to reject the request for Allotment to Renouncee(s) without assigning any reason thereof.

Procedure for renunciation

To renounce the whole offer in favour of one Renouncee

If you wish to renounce the offer indicated in Part A, in whole, please complete Part B of the CAF. In case of joint holding, all joint holders must sign Part B of the CAF. The person in whose favour renunciation has been made should complete and sign Part C of the CAF. In case of joint renouncees, all joint renouncees must sign this part of the CAF. Renouncee(s) shall not be entitled to further renounce the entitlement in favour of any other person.

To renounce in part/or renounce the whole to more than one person(s)

If you wish to accept this offer in part and renounce the balance or renounce the entire offer in favour of two or more renouncees, the CAF must be first split into requisite number of forms.

Please indicate your requirement of split forms in the space provided for this purpose in Part D of the CAF and return the entire CAF to the Registrar to the Issue so as to reach them latest by the close of business hours on the last date of receiving requests for split forms. On receipt of the required number of split forms from the Registrar, the procedure as mentioned in the preceding paragraph shall have to be followed.

In case the signature of the Equity Shareholder(s), who has renounced the Equity Shares, does not agree with the specimen registered with the Company, the application is liable to be rejected.

Renouncee(s)

The person(s) in whose favour the Equity Shares are renounced should fill in and sign Part C of the Application Form and submit the entire Application Form to the Bankers to the Issue on or before the Issue Closing Date along with the application money.

Change and/ or introduction of additional holders

If you wish to apply for Equity Shares jointly with any other person(s), not more than three, who is/are not already a joint holder with you, it shall amount to renunciation and the procedure as stated above for renunciation shall have to be followed. Even a change in the sequence of the name of joint holders shall amount to renunciation and the procedure, as stated above shall have to be followed.

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However, this right of renunciation is subject to the express condition that the Board of Directors of the Company shall be entitled in its absolute discretion to reject the request for allotment from the renouncee(s) without assigning any reason thereof.

Please note that:

• Part A of the CAF must not be used by any person(s) other than those in whose favour this Offer has been made. If used, this will render the application invalid; • Request by the Equity Shareholder(s) for the Split Application Form should reach the Company on or before [●]; • Only the person to whom the Draft Letter of Offer has been addressed to and not the renouncee(s) shall be entitled to renounce and to apply for Split Application Forms. Forms once split cannot be split again; and • Split form(s) will be sent to the applicant(s) by post at the applicant’s risk.

Additional Equity Shares

You are eligible to apply for additional Equity Shares over and above the number of Equity Shares you are entitled to, provided that you have applied for all the Equity Shares offered without renouncing them in whole or in part in favor of any other person(s). If you desire to apply for additional Equity Shares, please indicate your requirement in the place provided for additional shares in Part A of the CAF.

Applications for additional Equity Shares shall be considered and Allotment shall be in the manner prescribed under “Basis of Allotment” on page 246 of the Draft Letter of Offer. The Renouncees applying for all the Equity Shares renounced in their favour may also apply for additional Equity Shares.

In case of application for additional Equity Shares by Non-Resident Equity Shareholders, the allotment of additional securities will be subject to the permission of the RBI. Where the number of additional Equity Shares applied for exceeds the number available for Allotment, the Allotment would be made on a fair and equitable basis in consultation with the Designated Stock Exchange.

The summary of options available to the Equity Shareholder is presented below. You may exercise any of the following options with regard to the Equity Shares offered, using the enclosed CAF:

Option Available Action Required Accept whole or part of your entitlement Fill in and sign Part A (All joint holders must without renouncing the balance. sign)

Accept your entitlement in full and apply for Fill in and sign Part A including Asset III additional Equity Shares relating to the acceptance of entitlement and Asset IV relating to additional Equity Shares (All joint holders must sign)

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Option Available Action Required Renounce your entitlement in full to one Fill in and sign Part B (All joint holders must person (Joint renounces are considered as one) sign) indicating the number of Equity Shares renounced and hand it over to the renounce. The renounces must fill in and sign Part C (All joint renouncees must sign) Accept a part of your entitlement and renounce Fill in and sign Part D (all joint holders must the balance to one or more renounce(s) sign) requesting for Split Application Forms. Send the CAF to the Registrar to the Issue so OR as to reach them on or before the last date for receiving requests for Split Forms. Splitting Renounce your entitlement to all the Equity will be permitted only once. Shares offered to you to more than one renounce On receipt of the Split Form take action as indicated below. For the Equity Shares you wish to accept, if any, fill in and sign Part A. For the Equity Shares you wish to renounce, fill in and sign Part B indicating the number of Equity Shares renounced and hand it over to the renouncees. Each of the Renouncees should fill in and sign Part C for the Equity Shares accepted by them.

Introduce a joint holder or change the sequence This will be treated as renunciation. Fill in and of joint holders sign Part B and the Renouncees must fill in and sign Part C

For applicants residing at places other than designated Bank collecting branches

Resident investors residing at places other than the cities where the Bank collection centres have been opened and nonresident Applicants applying on a non-repatriation basis should send their completed CAF by registered post/speed post to the Registrar to the Issue, Intime Spectrum Registry Limited along with demand drafts net of bank and postal charges, payable at Mumbai in favour of the Bankers to the Issue, crossed account payee only and marked “ASAL-Rights Issue” so that the same are received on or before closure of the Issue i.e. [●].

Non-resident investors, who are not excluded U. S. Persons as defined in Regulation S under the U.S. Securities Act of 1933, as amended, (a "U.S. Person"), applying on a repatriation basis should send their completed CAF by registered post/speed post to the Registrar to the Issue, Intime Spectrum Registry Limited along with demand drafts for the full application amount, payable at Mumbai in favour of the Bankers to the Issue, crossed account payee only and marked "ASAL-Rights Issue NR" so that the same are received on or before closure of the Issue i.e. [●].

The Company will not be liable for any postal delays and applications received through mail after the closure of the Issue are liable to be rejected and returned to the applicants. Applications by mail should not be sent in any other manner except as mentioned below.

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Availability of duplicate CAF

In case the original CAF is not received, or is misplaced by the applicant, the Registrar to the Issue will issue a duplicate CAF on the request of the applicant who should furnish the registered folio number/ DP and Client ID number and his/her full name and address to the Registrar to the Issue. Please note that those who are making the application in the duplicate form should not utilize the original CAF for any purpose including renunciation, even if it is received / found subsequently. If the applicant violates any of these requirements, he / she shall face the risk of rejection of both the applications.

Application on Plain Paper

A resident Equity Shareholder or a non-resident Equity Shareholder, who is not an excluded U.S. Person as defined in Regulation S under the U.S. Securities Act of 1933, as amended, (a "U.S. Person"), applying on a non-repatriation basis who has neither received the original CAF nor is in a position to obtain the duplicate CAF may make an application to subscribe to the Issue on plain paper, along with an Account Payee Cheque drawn on a local bank at Mumbai or Demand Draft/Pay Order payable at Mumbai in favour of the Bankers to the Issue, crossed account payee only and marked "ASAL-Rights Issue" and send the same by registered post directly to the Registrar to the Issue.

A non-resident Equity Shareholder, who is not an excluded U.S. Person as defined in Regulation S under the U.S. Securities Act of 1933, as amended, (a "U.S. Person"), applying on a repatriation basis who has neither received the original CAF nor is in a position to obtain the duplicate CAF may make an application to subscribe to the Issue on plain paper, along with an Account Payee Cheque drawn on a local bank at Mumbai or Demand Draft/Pay Order payable at Mumbai in favour of the Bankers to the Issue, crossed account payee only and marked "ASAL- Rights Issue NR" and send the same by registered post directly to the Registrar to the Issue.

The application on plain paper, duly signed by the Applicants including joint holders, in the same order as per specimen recorded with the Company, must reach the office of the Registrar to the Issue before the Issue Closing Date and should contain the following particulars:

• Name of Issuer, being Automotive Stampings and Assemblies Limited; • Name and address of the Equity Shareholder including joint holders; • Registered Folio Number/ DP and Client ID No.; • Number of shares held as on Record Date; • Number of Rights Equity Shares entitled; • Number of Rights Equity Shares applied for; • Number of additional Equity Shares applied for, if any; total number of Equity Shares applied for; • Total amount paid at the rate of Rs. [●] per Equity Share; • Particulars of cheque/draft; Savings/Current Account Number and name and address of the bank where the Equity Shareholder will be depositing the refund order; PAN,

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photocopy of the Form 60 / Form 61 declaration for each Applicant in case of joint names; • Include the representation in writing that "I/We understand that the Rights entitlements and the Equity Shares have not been, and will not be, registered under the United States Securities Act of 1933, as amended (the "Securities Act"), or any United States state securities laws and may not be offered, sold, resold or otherwise transferred within the United States or to, or for the account or benefit of, "U.S. Persons" (as defined in Regulation S under the Securities Act (a "U.S. Person")), except in a transaction exempt from the registration requirements of the U.S. Securities Act, and I/we confirm that I/we am/are not a U.S. Person and am/are not applying for these Equity Shares for the account or benefit of a U.S. Person. There are no restrictions under the laws of my/our local jurisdiction that prevent or prohibit me/us from applying for the Equity Shares." In addition, residents of the European Economic Area must confirm that "I/We satisfy the requirements relating to the EEA in the Draft Letter of Offer."; and • Signature of Equity Shareholders to appear in the same sequence and order as they appear in the records of the Company.

Please note that those who are making the application otherwise than on original CAF shall not be entitled to renounce their rights and should not utilize the original CAF for any purpose including renunciation even if it is received subsequently.

If the Applicant violates any of these requirements, he/she shall face the risk of rejection of both the applications as well as forfeiture of amounts remitted along with the applications.

For Applicants residing at places where the Bank collection centres have been opened, application forms duly completed together with cash/ cheque/demand draft for the application money must be submitted before the close of the subscription list to the Bankers to the Issue named herein or to any of its branches mentioned on the reverse of the CAF. The CAF along with application money must not be sent to the Company or the Lead Manager to the Issue or the Registrar to the Issue.

For Applicants residing at places other than the cities where the Bank collection centres have been opened, application forms duly completed together with cash/ cheque/demand draft for the application money net of bank charges for demand draft and postal charges must reach Registrar to the Issue before the close of the subscription list.

The Applicants are requested to strictly adhere to these instructions. Failure to do so could result in the application being liable to be rejected with the Company, the Lead Manager and the Registrar not having any liabilities to such Applicants.

Last date of Application

The last date for submission of the duly filled in CAF is [●]. The Board or any committee thereof will have the right to extend the said date for such period as it may determine from time to time but not exceeding 60 (sixty) days from the Issue Opening Date.

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If the CAF together with the amount payable is not received by the Banker to the Issue/ Registrar to the Issue, as the case may be, on or before the close of banking hours on the aforesaid last date or such date as may be extended by the Board/ Committee of Directors, the offer contained in the Draft Letter of Offer shall be deemed to have been declined and the Board/ Committee of Directors shall be at liberty to dispose off the Equity Shares hereby offered, as provided under “Basis of Allotment”.

INVESTORS MAY PLEASE NOTE THAT THE EQUITY SHARES OF THE COMPANY CAN BE TRADED ON THE STOCK EXCHANGES ONLY IN DEMATERIALIZED FORM.

Basis of Allotment

Subject to the provisions contained in this Letter of Offer, the Articles of Association of the Company and the approval of the Designated Stock Exchange, the Board will proceed to allot the Equity Shares in the following order of priority:

(a) Full allotment to those Equity Shareholders who have applied for their Rights Entitlement either in full or in part and also to the Renouncee(s) who has / have applied for Equity Shares renounced in their favour, in full or in part.

(b) If the Shareholding of any of the Equity Shareholders is less than [●] or is not in multiples of [●], then the fractional entitlement of such holders for Equity Shares shall be ignored. Shareholders whose fractional entitlements are being ignored would be considered for Allotment of one additional Equity Share each if they apply for additional share(s). Allotment under this head shall be considered if there are any un-subscribed Equity Shares after Allotment under (a) above. If number of Equity Shares required for Allotment under for this head are more than number of shares available after Allotment under (a) above, the allotment would be made on a fair and equitable basis in consultation with the Designated Stock Exchange.

(c) Allotment to the Equity Shareholders who having applied for all the Equity Shares offered to them as part of the Issue and have also applied for additional Equity Shares will be made as far as possible on an equitable basis having due regard to the number of Equity Shares held by them on the Record Date, provided there is an under-subscribed portion after making full allotment in (a) and (b) above. The allotment of such Equity Shares will be at the sole discretion of the Board of Directors/Finance Committee in consultation with the Designated Stock Exchange, as a part of the Issue and not as a preferential allotment.

(d) Allotment to the Renouncees who having applied for the Equity Shares renounced in their favour have also applied for additional Equity Shares, provided there is an under-subscribed portion after making full allotment in (a), (b) and (c) above, will be made on a proportionate basis at the sole discretion of the Board of Directors/Finance Committee but in consultation with the Designated Stock Exchange, as a part of the Issue and not as a preferential allotment.

(e) After taking into account Allotment to be made under (a) and (b) above, if there is any unsubscribed portion, the same shall be deemed to be ‘unsubscribed’ for the purpose of

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regulation 3(1)(b)(ii) of the SEBI Takeover Code which would be available for allocation under (c) and (d) above. After considering the above Allotment, any additional Equity Shares shall be disposed off by the Board/Finance Committee of Directors authorised in this behalf by the Board of Directors of the Company, in such manner as they think most beneficial to the Company and the decision of the Board of Directors of the Company/Finance Committee in this regard shall be final and binding. In the event of oversubscription, Allotment will be made within the overall size of the issue.

Allotment to promoters of any unsubscribed portion, over and above their entitlement shall be done in compliance with Clause 40A of the Listing Agreement and the other applicable laws prevailing at that time.

The Company expects to complete the Allotment of Equity Shares within a period of 42 days from the date of closure of the Issue in accordance with the listing agreement with the BSE and NSE. The Company shall retain no oversubscription.

Underwriting

[●]

Allotment / Refund

The Company will issue and dispatch letters of Allotment/ share certificates/ demat credit and/or letters of regret along with refund order or credit the allotted securities to the respective beneficiary accounts, if any, within a period of 42 days from the date of closure of the Issue. If such money is not repaid within eight days from the day the Company becomes liable to pay it, the Company shall pay that money with interest as stipulated under section 73 of the Companies Act.

Applicants residing at 68 centers where clearing houses are managed by the Reserve Bank of India (RBI) will get refunds through ECS only (Electronic Clearing Service) except where Applicants are otherwise disclosed as applicable/eligible to get refunds through direct credit, NEFT and RTGS.

In case of those Applicants who have opted to receive their Rights Entitlement in physical form and the Company issues Letter of Allotment, the corresponding share certificates will be kept ready within three months from the date of Allotment thereof or such extended time as may be approved by the Company Law Board under section 113 of the Companies Act or other applicable provisions, if any. Allottees are requested to preserve such letters of Allotment, which would be exchanged later for the share certificates. For more information please refer to

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“Allotment/Refund” on page 247 of the Draft Letter of Offer.

The letter of Allotment / refund order exceeding Rs.1,500 would be sent by registered post/speed post to the sole/first Applicant’s registered address. Refund orders up to the value of Rs.1,500 would be sent under certificate of posting. Such refund orders would be payable at par at all places where the applications were originally accepted. The same would be marked ‘Account Payee only’ and would be drawn in favour of the sole/first Applicant. Adequate funds would be made available to the Registrar to the Issue for this purpose.

Payment of Refund

Mode of making refunds

The payment of refund, if any, would be done through any of the following modes:

1. ECS – Payment of refund would be done through ECS for applicants having an account at any of the following sixty-eight centres: Agra, Ahmedabad, Allahabad, Amritsar, Aurangabad, Bangalore, Baroda, Bhilwara, Bhopal, Bhubaneshwar, Burdwan(non-MICR), Calicut, Chandigarh, Chennai, Coimbatore, Dehradun, Dhanbad(non-MICR), Durgapur (non- MICR), Erode, Gorakhpur, Guwahati, Gwalior, Haldia (non- MICR), Hubli, Hyderabad, Indore, Jabalpur, Jaipur, Jalandhar, Jammu, Jamshedpur, Jodhpur, Kakinada (non-MICR), Kanpur, Kochi/Ernakulam, Kolhapur, Kolkata, Lucknow, Ludhiana, Madurai, Mangalore, Mumbai, Mysore, Nagpur, Nashik, Nellore (non-MICR), New Delhi, Panaji, Patna, Pondicherry, Pune, Raipur, Rajkot, Ranchi, Salem, Shimla (non-MICR), Sholapur, Siliguri (non-MICR), Surat, Thiruvananthapuram, Tirupati(non-MICR), Tirupur, Trichur, Trichy, Udaipur, Varanasi, Vijaywada and Visakhapatnam. This mode of payment of refunds would be subject to availability of complete bank account details including the MICR code as appearing on a cheque leaf, from the Depositories. The payment of refunds is mandatory for applicants having a bank account at any of the abovementioned sixty-eight centres, except where the Applicant, being eligible, opts to receive refund through NEFT, direct credit or RTGS.

2. NEFT (National Electronic Fund Transfer) – NEFT refunds will be done for the Applicants’ whose bank branches have been assigned the Indian Financial System Code (IFSC) and which can also be linked to a Magnetic Ink Character Recognition (MICR) of that particular bank branch. IFSC will be obtained from the RBI website as on a date immediately prior to the date of payment of refund, duly mapped with MICR numbers. Wherever the Applicants have registered their nine digit MICR number and their bank account number while opening and operating the demat account, the same will be duly mapped with the IFSC Code of that particular bank branch and the payment of refund will be made to the Applicants through this method. Alternatively the applicant can also mention the NEFT IFSC in the bid-cum- application form as is the case for RTGS refunds.

3. Direct Credit – Applicants having bank accounts with the Refund Banker(s), in this case being [●] shall be eligible to receive refunds through direct credit. Charges, if any, levied by the Refund Bank(s) for the same would be borne by the Company.

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4. RTGS – Applicants having a bank account at any of the above mentioned sixty eight centres and whose refund amount exceeds Rs. 0.1 million, have the option to receive refund through RTGS. Such eligible Applicants who indicate their preference to receive refund through RTGS are required to provide the IFSC code in the Bid-cum-application Form. In the event the same is not provided, refund shall be made through ECS. Charges, if any, levied by the Refund Bank(s) for the same would be borne by the Company. Charges, if any, levied by the Applicant’s bank receiving the credit would be borne by the Applicant.

5. For all other Applicants, including those who have not updated their bank particulars with the MICR code, the refund orders will be despatched under certificate of posting for value up to Rs. 1,500 and through Speed Post/Registered Post for refund orders of Rs. 1,500 and above. Such refunds will be made by cheques, pay orders or demand drafts drawn on [y] and payable at par.

Letters of Allotment / Share Certificates / Demat Credit

Letter(s) of Allotment/ share certificates/ demat credit or letters of regret will be dispatched to the registered address of the first named Applicant or respective beneficiary accounts will be credited within 6 (six) weeks, from the date of closure of the subscription list. In case the Company issues letters of allotment, the relative share certificates will be dispatched within three months from the date of allotment. Allottees are requested to preserve such letters of allotment (if any) to be exchanged later for share certificates. Export of letters of allotment (if any)/ share certificates/ demat credit to non-resident allottees will be subject to the approval of RBI.

Option to receive Equity Shares in Dematerialized Form

Applicants to the Equity Shares of the Company issued through this Issue shall be allotted the securities in dematerialized (electronic) form at the option of the applicant. The Company signed a tripartite agreement with National Securities Depository Limited (NSDL) on April 18, 2007 and with Central Depository Services (India) Limited (CDSL) on March 20, 2007 which enables the Investors to hold and trade in securities in a form, instead of holding the securities in the form of physical certificates.

In this Issue, the Allottees who have opted for Equity Shares in form will receive their Equity Shares in the form of an electronic credit to their beneficiary account with a depository participant. Investor will have to give the relevant particulars for this purpose in the appropriate place in the CAF. Applications, which do not accurately contain this information, will be given the securities in physical form. No separate applications for securities in physical and/or dematerialized form should be made. If such applications are made, the application for physical securities will be treated as multiple applications and is liable to be rejected. In case of partial allotment, allotment will be one in demat option for the shares sought in demat and balance, if any, may be allotted in physical shares.

The Equity Shares of the Company will be listed on the BSE and the NSE.

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Procedure for availing the facility for Allotment of Equity Shares in this Issue in the electronic form is as under:

1. Open a beneficiary account with any depository participant (care should be taken that the beneficiary account should carry the name of the holder in the same manner as is exhibited in the records of the Company. In the case of joint holding, the beneficiary account should be opened carrying the names of the holders in the same order as with the Company). In case of investors having various folios in the Company with different joint holders, the investors will have to open separate accounts for such holdings. Those Equity Shareholders who have already opened such beneficiary account(s) need not adhere to this step.

2. For Equity Shareholders already holding Equity Shares of the Company in dematerialized form as on the Record Date, the beneficial account number shall be printed on the CAF. For those who open accounts later or those who change their accounts and wish to receive their Equity Shares pursuant to this Issue by way of credit to such account, the necessary details of their beneficiary account should be filled in the space provided in the CAF. It may be noted that the Allotment of Equity Shares arising out of this Issue may be made in dematerialized form even if the original Equity Shares of the Company are not dematerialized. Nonetheless, it should be ensured that the depository account is in the name(s) of the Equity Shareholders and the names are in the same order as in the records of the Company.

3. Responsibility for correctness of information (including Applicant’s age and other details) filled in the CAF vis-à-vis such information with the Applicant’s depository participant, would rest with the Applicant. Applicants should ensure that the names of the Applicants and the order in which they appear in CAF should be the same as registered with the Applicant’s depository participant.

4. Applicants must necessarily fill in the details (including the beneficiary account number or client ID number) appearing in the CAF under the heading ‘Request for Shares in Electronic Form’.

5. Equity Share/Warrants Allotted to an Applicant in the electronic account form will be credited directly to the Applicant’s respective beneficiary account(s) with depository participant.

6. Applicants should ensure that the names of the Applicants and the order in which they appear in the CAF should be the same as registered with the Applicant’s depository participant.

7. Non-transferable Allotment advice/refund orders will be directly sent to the Applicant by the Registrar to this Issue.

8. If incomplete/incorrect details are given under the heading ‘Request for Shares in Electronic Form’ in the CAF, the Applicant will get Equity Shares in physical form.

9. Renouncees can also exercise the option to receive Equity Shares in the demat form by indicating in the relevant asset and providing the necessary details about their beneficiary

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account.

10. It may be noted that Equity Share arising out of this Issue can be received in demat form even if the existing Equity Shares are held in physical form. Nonetheless, it should be ensured that the depository participant account is in the name of the Applicant(s) in the same order as per specimen signatures appearing in the records of the depository participant/Company.

11. It may be noted that shares in electronic form can be traded only on the Stock Exchanges having electronic connectivity with NSDL or CDSL.

12. Dividend or other benefits with respect to the Equity Shares held in dematerialized form would be paid to those Equity Shareholders whose names appear in the list of beneficial owners given by the depository participant to the Company as on the date of the book closure.

13. If incomplete / incorrect beneficiary account details are given in the CAF the Applicant will get Equity Shares in physical form.

14. The Equity Shares pursuant to this Issue Allotted to Investors opting for dematerialized form would be directly credited to the beneficiary account as given in the CAF after verification. Allotment advice, refund order (if any) would be sent directly to the Applicant by the Registrar to the Issue but the Applicant’s depository participant will provide to him the confirmation of the credit of such Equity Shares to the Applicant’s depository account.

15. Renouncees will also have to provide the necessary details about their beneficiary account for Allotment of securities in this Issue. In case these details are incomplete or incorrect, the Renouncees will get Equity Shares in physical form.

UNIQUE IDENTIFICATION NUMBER - MAPIN

Unique Identification Number (“UIN”)

With effect from July 1, 2005, SEBI had decided to suspend all fresh registrations for obtaining UIN and the requirement to contain/quote UIN under the SEBI MAPIN Regulations/Circulars vide its circular MAPIN/Cir-13/2005. However, in a recent press release dated December 30, 2005, SEBI has approved certain policy decisions and has now decided to resume registrations for obtaining UINs in a phased manner. The press release states that the cut off limit for obtaining UIN has been raised from the existing limit of trade order value of Rs.100,000 to Rs. 500,000 or more. The limit will be reduced progressively. For trade order value of less than Rs. 500,000 an option will be available to investors to obtain either the PAN or UIN. These changes are, however, not effective as of the date of the Draft Letter of Offer and SEBI has stated in the press release that the changes will be implemented only after necessary amendments are made to the SEBI MAPIN Regulations.

General instructions for applicants

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a) Please read the instructions printed on the enclosed CAF carefully.

b) Application should be made on the printed CAF, provided by the Company and should be completed in all respects. The CAF found incomplete with regard to any of the particulars required to be given therein, and / or which are not completed in conformity with the terms of the Draft Letter of Offer are liable to be rejected and the money paid, if any, in respect thereof will be refunded without interest and after deduction of bank commission and other charges, if any. The CAF must be filled in English and the names of all the Applicants, details of occupation, address, father’s /husband’s name must be filled in block letters.

c) The CAF together with cheque / demand draft should be sent to the Bankers to the Issue / Collecting Bank or to the Registrar to the Issue, as the case may be, and not to the Company and the Lead Manager to the Issue. Applicants residing at places other than cities where the branches of the Bankers to the Issue have been authorized by the Company for collecting applications, will have to make payment by Account Payee Cheque drawn on a local bank at Mumbai or Demand Draft/Pay Order payable at Mumbai in favour of the Bankers to the Issue, crossed account payee only and marked “ASAL-Rights Issue” and send their application forms to the Registrar to the Issue by registered post. If any portion of the CAF is / are detached or separated, such application is liable to be rejected. d) Each of the Applicants should mention his/her PAN allotted under the Income Tax Act, 1961 along with the application, for the purpose of verification of the number. CAFs without PAN details will be considered incomplete and are liable to be rejected. e) Applicants are advised to provide information as to their savings/current account number, 9 digit MICR number and the name of the Bank, branch with whom such account is held in the CAF to enable the Registrar to the Issue to print the said details in the refund orders, if any, after the names of the payees. f) The payment against the application should not be effected in cash if the amount to be paid is Rs. 20,000 or more. In case payment is effected in contravention of this, the application may be deemed invalid and the application money will be refunded and no interest will be paid thereon. Payment against the application if made in cash, subject to conditions as mentioned above, should be made only to the Bankers to the Issue. g) Signatures should be either in English, Hindi or Marathi or in any other language specified in the Eighth Schedule to the Constitution of India. Signatures other than in English or Hindi and thumb impression must be attested by a Notary Public or a Special Executive Magistrate under his/ her official seal. The Equity Shareholders must sign the CAF as per the specimen signature recorded with the Company. h) In case of an application under power of attorney or by a body corporate or by a society, a certified true copy of the relevant power of attorney or relevant resolution or authority to the signatory to make the relevant investment under this Offer and to sign the application and a copy of the Memorandum and Articles of Association and / or bye laws of such body

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corporate or society must be lodged with the Registrar to the Issue giving reference of the serial number of the CAF. In case these papers are sent to any other entity besides the Registrar to the Issue or are sent after the Issue Closing Date, then the application is liable to be rejected.

i) In case of joint holders, all joint holders must sign the relevant part of the CAF in the same order and as per the specimen signature(s) recorded with the Company. Further, in case of joint Applicants who are Renouncees, the number of Applicants should not exceed three. In case of joint Applicants, reference, if any, will be made in the first Applicant’s name and all communication will be addressed to the first Applicant. j) Application(s) received from Non-Resident / NRIs, or persons of Indian origin residing abroad for Allotment of Equity Shares shall, inter alia, be subject to conditions, as may be imposed from time to time by the RBI under FEMA in the matter of refund of application money, Allotment of Equity Shares, subsequent issue and Allotment of Equity Shares, interest, export of share certificates, etc. In case a Non-Resident or NRI Equity Shareholder has specific approval from the RBI, in connection with his shareholding, he should enclose a copy of such approval with the CAF.

k) All communication in connection with application for the Equity Shares, including any change in address of the Equity Shareholders should be addressed to the Registrar to the Issue prior to the date of Allotment in this Issue quoting the name of the first / sole applicant Equity Shareholder, folio numbers and CAF number. Please note that any intimation for change of address of Equity Shareholders, after the date of Allotment, should be sent to the Registrar and Transfer Agents of the Company Intime Spectrum Registry Limited in the case of Equity Shares held in physical form and to the respective depository participant, in case of Equity Shares held in dematerialized form.

l) Split forms cannot be re-split.

m) Only the person or persons to whom Equity Shares have been offered and not Renouncee(s) shall be entitled to obtain split forms.

n) Applicants must write their CAF number at the back of the cheque / demand draft.

o) Only one mode of payment per application should be used. The payment must be either in cash or by cheque /demand draft drawn on any of the banks, including a co-operative bank, which is situated at and is a member or a sub member of the Bankers Clearing House located at the centre indicated on the reverse of the CAF where the application is to be submitted.

p) A separate cheque / draft must accompany each CAF. Outstation cheques / demand drafts or post-dated cheques and postal / money orders will not be accepted and applications accompanied by such cheques / demand drafts /money orders or postal orders will be rejected. The Registrar will not accept payment against application if made in cash. (For payment against application in cash please refer point (f) above)

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q) No receipt will be issued for application money received. The Bankers to the Issue / Collecting Bank / Registrar will acknowledge receipt of the same by stamping and returning the acknowledgment slip at the bottom of the CAF.

Grounds for Technical Rejections

Applicants are advised to note that applications are liable to be rejected on technical grounds, including the following:

• Amount paid does not tally with the amount payable for; • Bank account details (for refund) are not given; • Age of First Applicant not given; • PAN No./ Form 60 / Form 61 declaration not given; • In case of Application made under power of attorney or by limited companies, corporate, trust, etc., relevant documents are not submitted; • If the signature of the existing Shareholder does not match with the one given on the Application Form and for Renouncees if the signature does not match with the records available with their depositories; • If the Applicant desires to have shares in electronic form, but the Application Form does not have the Applicant’s depository account details; • Application Forms are not submitted by the Applicants within the time prescribed as per the Application Form and the Draft Letter of Offer; • Applications not duly signed by the sole/joint Applicants; • Applications by OCBs unless accompanied by specific approval from the RBI permitting the OCBs to invest in the Issue; • Applications accompanied by Stockinvest; • In case no corresponding record is available with the Depositories that matches three parameters, namely, names of the Applicants (including the order of names of joint holders), the Depository Participant’s identity (DP ID) and the beneficiary’s identity; • Applications by in eligible US Persons as defined in Regulation S under the United States Securities Act of 1933, as amended, or; • Applications by ineligible Non-residents (including on account of restriction or prohibition under applicable local laws) and where last available address in India has not been provided.

Mode of payment for Resident Equity Shareholders/ Applicants

• Applicants who are resident in centers with the bank collection centres shall draw cheques / drafts accompanying the CAF in favour of the Bankers to the Issue, crossed account payee only and marked “ASAL-Rights Issue”. • Applicants residing at places other than places where the bank collection centres have been opened by the Company for collecting applications, are requested to send their applications together with Demand Draft/Pay Order payable at Mumbai in favour of the Bankers to the Issue, crossed account payee only and marked “ASAL-Rights Issue” directly to the Registrar to the Issue by registered post so as to reach them on or before

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the Issue Closing Date. The Company or the Registrar to the Issue will not be responsible for postal delays or loss of applications in transit, if any.

Mode of payment for Non-Resident Equity Shareholders/ Applicants

As regards the application by non-resident Equity Shareholders, payment must be made by demand draft payable at Mumbai / cheque payable drawn on a bank account maintained at Mumbai or funds remitted from abroad in any of the following ways:

Application with repatriation benefits

• By Indian Rupee drafts purchased from abroad and payable at Mumbai or funds remitted from abroad (submitted along with Foreign Inward Remittance Certificate); or • By cheque / draft on a Non-Resident External Account (NRE) or FCNR Account maintained in Mumbai; or • By Rupee draft purchased by debit to NRE/ FCNR Account maintained elsewhere in India and payable in Mumbai; or FIIs registered with SEBI must remit funds from special non-resident rupee deposit account. • Non-resident investors applying with repatriation benefits should draw cheques/drafts in favour of the Bankers to the Issue and marked ‘ASAL-Rights Issue NR’ payable at Mumbai and must be crossed ‘account payee only’ for the full application amount

Application without repatriation benefits

As far as non-residents holding shares on non-repatriation basis is concerned, in addition to the modes specified above, payment may also be made by way of cheque drawn on Non-Resident (Ordinary) Account maintained in Mumbai or Rupee Draft purchased out of NRO Account maintained elsewhere in India but payable at Mumbai. In such cases, the allotment of Equity Shares will be on non-repatriation basis.

All cheques/drafts submitted by non-residents applying on a non-repatriation basis should be drawn in favour of the Bankers to the Issue and marked ‘ASAL-Rights Issue’ payable at Mumbai and must be crossed ‘account payee only’ for the full application amount. The CAF duly completed together with the amount payable on application must be deposited with the Collecting Bank indicated on the reverse of the CAF before the close of banking hours on or before the Issue Closing Date. A separate cheque or bank draft must accompany each CAF.

Applicants may note that where payment is made by drafts purchased from NRE/ FCNR/ NRO accounts as the case may be, an Account Debit Certificate from the bank issuing the draft confirming that the draft has been issued by debiting the NRE/ FCNR/ NRO account should be enclosed with the CAF. Otherwise the application shall be considered incomplete and is liable to be rejected.

New demat account shall be opened for holders who have had a change in status from resident Indian to NRI.

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Note:

• In case where repatriation benefit is available, interest, dividend, sales proceeds derived from the investment in Equity Shares can be remitted outside India, subject to tax, as applicable according to IT Act. • In case Equity Shares are allotted on non-repatriation basis, the dividend and sale proceeds of the Equity Shares cannot be remitted outside India. • The CAF duly completed together with the amount payable on application must be deposited with the Collecting Bank indicated on the reverse of the CAF before the close of banking hours on or before the Issue Closing Date. A separate cheque or bank draft must accompany each CAF. • In case of an application received from non-residents, allotment, refunds and other distribution, if any, will be made in accordance with the guidelines/ rules prescribed by RBI as applicable at the time of making such allotment, remittance and subject to necessary approvals.

Payment by Stockinvest

In terms of RBI Circular DBOD No. FSC BC 42/24.47.00/2003-04 dated November 5, 2003, the Stockinvest scheme has =been withdrawn with immediate effect. Hence, payment through Stockinvest would not be accepted in this Issue.

Disposal of application and application money

No acknowledgment will be issued for the application moneys received by the Company. However, the Bankers to the Issue / Registrar to the Issue receiving the CAF will acknowledge its receipt by stamping and returning the acknowledgment slip at the bottom of each CAF.

The Board reserves its full, unqualified and absolute right to accept or reject any application, in whole or in part, and in either case without assigning any reason thereto.

In case an application is rejected in full, the whole of the application money received will be refunded. Wherever an application is rejected in part, the balance of application money, if any, after adjusting any money due on Equity Shares allotted, will be refunded to the applicant within six weeks from the close of the Issue.

For further instruction, please read the Composite Application Form (CAF) carefully.

Important

• Please read the Draft Letter of Offer carefully before taking any action. The instructions contained in the accompanying CAF are an integral part of the conditions of the Draft Letter of Offer and must be carefully followed; otherwise the application is liable to be rejected.

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• All enquiries in connection with the Draft Letter of Offer or accompanying CAF and requests for Split Application Forms must be addressed (quoting the Registered Folio Number/ DP and Client ID number, the CAF number and the name of the first Equity Shareholder as mentioned on the CAF and superscribed ‘ASAL-Rights Issue’ on the envelope) to the Registrar to the Issue at the following address:

Intime Spectrum Registry Limited C-13, Pannalal Silk Mills Compound, L.B.S Marg Bhandup (West) Mumbai 400 078 Tel: +91 22 2596 0320 Fax: +91 22 2596 0329 Toll Free No. : 1800 22 0320 Email: [email protected] Contact Person: Ms. Awani Thakkar

The Issue will be kept open for 30 days unless extended, in which case it will be kept open for a maximum of 60 days.

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SECTION VIII: OTHER INFORMATION

MATERIAL CONTRACTS AND DOCUMENTS FOR INSPECTION

The contracts mentioned below (not being contracts entered into in the ordinary course of business carried on by our Company) are or may be deemed to be material contracts. These contracts and also the documents for inspection referred to hereunder, may be inspected at the Registered Office of our Company situated at G-71/2, MIDC Industrial Area, Pune 411 026 from 11.00 a.m. to 2.00 p.m. on any working day from the date of the Draft Letter of Offer until the Issue Closing Date.

A. Material Contracts

• Memorandum of Understanding dated June 23, 2008, between our Company and YES Bank Limited. • Memorandum of Understanding dated June 27, 2008, between our Company and Intime Spectrum Registry Limited, appointing them as Registrar to the Issue. • Tripartite Agreement dated April 18, 2007 between our Company, Intime Spectrum Registry Limited and NSDL. • Tripartite Agreement dated March 20, 2007 between our Company, Intime Spectrum Registry Limited and CDSL.

B. Documents

• Memorandum and Articles of Association of our Company, as amended till date. • Share Purchase Agreement dated February 13, 2007, entered into between TACO and Gestamp Servicios, S.L. • Contract of Employment of CEO Mr. Nagaraju Srirama dated February 17, 2007 ans supplementary agreement thereto. • Copy of the Resolution u/s 81 of the Companies Act, 1956 passed by the Board of Directors in their meeting held on January 17, 2008. • Consents from the Auditors, Lead Manager to the Issue, Registrar to the Issue, Legal Advisor to the Issue, Bankers to the Issue, Bankers to our Company, Directors, Compliance Officer to include their names in the Draft Letter of Offer and to act in their respective capacities. • Audit report by the statutory auditors of our Company dated April 28, 2008 included in the Draft Letter of Offer. • Certificate dated June 3, 2008 from the statutory auditors of our Company detailing the tax benefits. • Annual Reports of our Company for the last five financial years. • Applications dated [●] for in-principle listing approval addressed to all Stock Exchange(s).

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• Copy of the in-principle listing approval from Bombay Stock Exchange Limited and National Stock Exchange of India Limited for listing of Equity Shares arising from this Issue vide their letters dated [●] and [●] respectively. • SEBI Observation letter no. [●] dated [●] for the Issue. • Due Diligence certificate dated July 10, 2008 to SEBI issued by YES Bank Limited as Lead Manager to the Issue. • Copy of the in-seriatim reply to SEBI observations filed by YES Bank as Lead Manager to the Issue, with SEBI vide letter [●].

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DECLARATION No statement made in the Draft Letter of Offer contravenes any of the provisions of the Companies Act, 1956 and the rules made there under. All the legal requirements connected with the said Issue as also the guidelines, instructions etc., issued by SEBI, Government and any other competent authority in this behalf have been duly complied with. Since the date of the last financial statement disclosed in the Draft Letter of Offer, there have been no circumstances that materially and adversely affect or are likely to affect the trading or profitability of the Company or the value of its assets or its ability to pay its liabilities within the next twelve months except as stated under the section Management’s Discussions and Analysis. The Company accepts no responsibility for statements made otherwise than in the Draft Letter of Offer or in the advertisement or any other material issued by or at the instance of the Company and that anyone placing reliance on any other source of information would be doing so at their own risk. We hereby certify to our knowledge that all the disclosures contained in the Draft Letter of Offer are true and correct in all material respects. SIGNED BY ALL THE DIRECTORS OF THE COMPANY

Mr. Devender S. Gupta Chairman and Non Executive Director Sd/- Mr.Fransisco José Riberas Mera Non Executive Director Sd/- Mr. Rameshwar S. Thakur Non Executive Director Sd/- Mr. Fransisco López Pena Non Executive Director Sd/- Mr.Ramesh A. Savoor Independent Director Sd/- Mr. Pradeep Mallick Independent Director Sd/- Mr. S. Ramakrishnan Independent Director Sd/-

Place: Mumbai Date: July 10, 2008

SIGNED BY THE CHIEF EXECUTIVE OFFICER OF THE COMPANY

Mr. Nagaraju Srirama Chief Executive Officer Sd/- Place: Mumbai Date: July 10, 2008 SIGNED BY THE CHIEF FINANCIAL OFFICER OF THE COMPANY Mr. Parshuram G. Date Chief Financial Officer Sd/-

Place: Mumbai Date: July 10, 2008

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