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Updated:19 Jun, 2019, 13:59 PM IST

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Updated:19 Jun, 2019, 14:08 PM IST




Your Directors take pleasure in presenting the 53rd Annual Report on the business and operations of the Company, together with the Audited Financial Statement for the year ended March 31, 2015.

Your Company reported attractive growth in its topline and bottom line, the slowdown in the Indian economy notwithstanding. This counter–trend performance is the result of proactive capacity and capability investments, deepening on core competence, stronger customer orientation, opportunity responsiveness, robust Balance Sheet and extensive de–risking.

2. Highlights of our performance

The Company recorded total sales of Rs.14,298.40 Million (Rs.12,745.21 Million in 2013–14), registering a growth of 12%, which outperformed the auto industry growth of 7.2% during the year under review. The Company reported a 30.85% growth in EBITDA, largely on account of volume growth in the two–wheeler segment, higher exports and expense control. The result was a Profit after Tax of Rs.600.24 Million (Rs.425.99 Million in 2013–14), which represented a 40.9% growth over the previous year. The Earnings per Share increased to Rs.4.18 from Rs.2.97 per share in 2013–14.

What is creditable is that the various economic and sector challenges notwithstanding, the Company reported an improvement in EBITDA margins – from 7.04% in the first quarter of the year under review to 8.34% in the last quarter. The result is that the Company's annual EBITDA margin strengthened from 7.14% in 2013–14 to 8.32% in 2014–15.


The Company reported Rs.8,869.3 Million in revenues from this segment during the year under review, which was a 18% growth over the previous year. The Company's two/three–wheeler accounted for 62% of total revenues compared to 59% in 2013–14. The Company accounted for a larger share of the wallet of prominent customers like TVS, Honda and Yamaha.

Passenger cars

The Company's revenues contracted by 2% during the year following 3.9% industry growth in the passenger vehicle segment. The Company's passenger cars accounted for 26% of total revenues compared to 30% in 2013–14. The

Company addressed the needs of respected customers like Maruti Suzuki India Ltd, Mahindra & Mahindra Ltd., Volkswagen and Toyota Kirloskar.

Commercial vehicle and railways

The Company reported Rs.1,569.5 Million in revenues from this segment during the year under review, which was a 15.5% growth over the previous year. The commercial vehicle and railways accounted for 11% of the total revenues.


Over the years, the Company strengthened its research, product customisation, technology arrangements, quality and cost management not only to address the available opportunity in India but also to carve out a growing share of global opportunities.

The Company's increasing focus on exports was inspired by a need to progressively de–risk revenues from an excessive dependence on the domestic geography, increased sales and graduate to superior economies, enhancing competitiveness.

The Company's exports increased from Rs.358.23 Million in 2013–14 to Rs.552 Million in 2014–15 i.e. a growth of correspondingly, exports as a proportion of sales increased  from 3% in 2013–14 to 4%.

During the year under review, the Company received an export order from Mahindra GenZe USA (electric scooter developed, made and manufactured in Michigan by Mahindra USA used for campus movements for R–scooter–Amphere). The Company also won an export order for commercial vehicle from ASEAN region where production will commence from December 2015.


The after–market domestic segment reported revenues of Rs.1,622 Million in 2014–15, a 15% growth over the previous year. Revenues from the after–market as a proportion of sales increased from 11.1% in 2013–14 to 11.3% in 2014–15. The growth in this segment was mainly derived from launch of new products and entry into new geographies.

The Company strengthened its brand and retailer–connect through the launch of the first–of–its–kind Elite Retailer programme which was conducted across 198 retailers in  2014–15.

3. Business Outlook

The prospects of the Company appear reasonably optimistic for a number of reasons.

The forecast for 2015–16 is expected to be marginally better even as double–digit sectoral growth may be elusive. With the government's 'Make in India' initiative likely to strengthen the case for manufacturing and moderate GDP growth expected, the Indian auto sector appears poised for a reasonable improvement. The Company's performance in aftermarket and exports is expected to do better on the bench of improved thrust and focus.

4. Operations

Your Company is pleased to report that a high operating efficiency across its various manufacturing plants represented the bedrock of its success. This operating efficiency was marked by process improvements, constant benchmarking with available best practices, technology collaborations, employee training and a conducive working environment.

Parwanoo (Himachal Pradesh): This plant manufactures GRC shox, SOQI shox, McPherson struts and front forks. The plant strengthened its 5S and energy management, moderating energy costs per unit. The plant added a number of aftermarket products and reported a significant improvement in leveraging the Heijunka production system.

Khandsa (Haryana): It addresses the growing requirements of Maruti Suzuki, its single largest customer. During the year under review, the Company widened its product diversity, making it possible to address the needs of other customers as well. The plant retained its competitive edge through the  sustained implementation of Lean Manufacturing concepts, which translated into enhanced line efficiency, human productivity and material economy. The plant received an award at the Quality Circle competition (QCFI–Delhi Chapter) and appreciation by Honda Cars India Limited for the best Quality Circle practices and team working, among others.

Chakan (Maharashtra): The plant is adequately empowered through relevant global quality certifications like TS 16949, ISO 14001, OSHAS 18001 and VDA 6.3. The plant strengthened its manufacturing competencies by setting new benchmarks, which were recognised through awards from reputed customers and other prominent agencies. The plant was showcased as a benchmark plant by Toyota, Honda and Volkswagen to their other suppliers.

The Company strengthened its holistic responsibility through the installation of state–of–art technologies and processes (chrome plating, painting, laser welding and component cleaning) as well as the installation of a solar plant(for captive consumption), moderating the carbon footprint and making the plant a showcase for the 'Best Green Initiative'. The plant also won a prestigious green initiative award from the reputable Dr. R.J.Rathi and the DSK Energy Gold Award.

The plant won a number of awards across categories for incorporating best practices in AHPS, EHS and MSES; it was provided a Toyota commendation certificate for achieving quality targets. The plant won the coveted gold award at the national level in Total Employee Involvement from ACMA, the Par Excellence Award in Quality Circle and the Gold and Silver Award in Safety from QCFI.

Aluminum Casting Facility, Chakan (Maharashtra): This facility continued to report year–on–year improvement in efficiency and energy management systems, winning the prestigious 'Trailblazer Innovation Award' within Anand Group. The plant strengthened its quality and competitiveness related to the manufacture of specialty aluminum castings for front forks. The facility focused on enhancing plant efficiency, quality and carbon foot print reduction. It developed the new front fork outer tube casting for Honda Motors & Scooters as well as new products for Yamaha and Royal Enfield. The plant is also focusing on backward integration by manufacturing Special Aluminum Alloy AC4D within the facility in this financial year.

Ambad (Maharashtra): The plant set quality benchmarks and won customer appreciation through the BAL TPM Excellence Award and Honda National Level Quality Circle Award; it won industry appreciation through the Platinum Award from FICCI (second time) in 2013. The plant received the Gold Award at the National Level ACT Summit 2015 for Best Quality Case Study, first prize in the Kaizen Competition organised by ACNA West Region and first prize in the Regional Quality Circle Competition (organised by HMSI 2 & 4 wheeler).

Dewas (Madhya Pradesh): The plant retained its topline despite a demand decline for commercial vehicles, excelling across a number of performance ratios. The Dewas plant focused on the upgradation of facilities; it embarked on the VSME journey to create a win–win customer–supplier proposition. The plant was acknowledged among the five best technology suppliers by VECV. The plant was the prime contributor in the Company winning the Mahindra – SPD Best Supplier Award. The plant received the letter of intent for an export breakthrough order from Isuzu (commercial vehicles). The Dewas plant continued to strengthen its dominance in the domestic commercial vehicles segment through an increased share of business from longstanding and emerging OEMs.

Hosur (Tamil Nadu): The plant, the Company's largest, reported substantial improvements in lean manufacturing and operational decongesting. The plant focused on process improvement, automation, vendor reduction and capacity enhancement for shock absorbers.

Malur (Karnataka): This plant reported a 118 % increase in volumes. The Company's new facility commenced  production in May 2013 to service the growing needs of Honda Motorcycles & Scooters India. The plant achieved cost reduction, which was recognised through VAVE [Value Added Value Engineering] award for 2014–15 from Suzuki Motorcycles and Scooters India Pvt Ltd  Sanand (Gujarat): The plant continues to service the needs of TATA Nano programme.

Aurangabad (Maharashtra): The satellite plant represents a manufacturing and assembly extension to the Ambad plant for addressing the large requirements of Bajaj Auto.

5. Dividend

Your Directors had declared an interim dividend of Rs.0.45 per equity share of rupees one each (previous year Rs.0.35). This dividend amounted to Rs.64.64 Million (previous year Rs.50.28 Million). This was distributed to shareholders, whose names appeared on the Register of Members as on 22nd November, 2014. Your Directors further recommended for the approval of shareholders a final dividend of Rs.0.60 per equity share of rupees one each (previous year 0.50 per equity share of rupees one each).

The proposed dividend will amount to Rs.86.20 Million (previous year Rs.71.82 Million). The dividend, subject to its declaration, will be distributed to shareholders whose names appear on the Register of Members on July 30, 2015.

During the year under review, the unclaimed dividend pertaining to the financial years 2005–06 and 2006–07 was transferred to the Investor Education and Protection Fund following a due notice to members.

6. Share capital

The paid–up Equity Share Capital as on March 31, 2015 was Rs.143.6 Million. During the year under review, the Company did not issue any shares and did not grant stock options or sweat equity shares to employees. The details of the shareholding of the Directors are as mentioned below as on March 31, 2015.

7. Deposits

The Company was accepting public deposits as per the provisions of the Companies Act, 1956 till 31st March, 2014. In compliance with the provisions of Section 73 and 74 of the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014, the Company re–launched the Public Deposit Scheme from 9th January, 2015 (brief details below)

8. Meetings of the board

The Board of the Company comprised six Directors as on 31st March, 2015. The Board comprised of Mrs. Anjali Anand, Mr. Manoj Kolhatkar, Mr. Pradipta Sen, Mr. Atul Khosla, Mr. Aditya Vij and Mr. Rohit Philip. The details of the meetings held during the financial year under review are mentioned below.

9. Directors and key managerial personnel

Pursuant to Section 149(10) of the Companies Act, 2013 the appointment of the Non–Executive Independent Directors is proposed in the Annual General Meeting for a period of five years. The details of the Directors who are proposed to be appointed in the ensuing Annual General Meeting forms part of the Corporate Governance Report.

The Board of Directors deeply appreciates the contribution of Mr. Deepak Chopra, Mr. Rajeev Vasudeva, Mr. HR Prasad, Mr. Gurdeep Singh and Dr. Arun Jaura, who resigned from the Board during the year under review. The resigning Directors provided valuable guidance that benefited the Company.

In accordance with the provisions of Section 152 of the Companies Act, 2013 and Article 123 of the Articles of Association, Mr. Rohit Philip retires by rotation. Mr. Rohit Philip has expressed his unwillingness to be re–appointed so and Company proposes not to fill the vacancy so caused on the Board of the Company at the forthcoming AGM in terms of the Section 152 of the Companies Act, 2013.

B. Declaration of Independence

The Non–Executive Independent Directors enlisted below provided a declaration under Section 149 (6) of the Companies Act, 2013 that they meet the criteria of independence. The declarations from the Directors is attached as Annexure A

Sr. No. Name of Director

1 Mr. Pradipta Sen

2 Mr. Atul Khosla

3 Dr. Arun Jaura*

4 Mr. Aditya Vij

* Resigned from the Board w.e.f. 30th January, 2015

C. Formal evaluation

Pursuant to the provisions of the Companies Act, 2013 and the Clause 49 of the Listing agreement, the Board carried out an annual evaluation of its own, the Chairperson and the Directors individually. A detailed note on the manner of evaluation forms a part of the Corporate Governance Report.

10. Remuneration to directors and remuneration policy

Remuneration is being paid to the Managing Director under Section 197 and 198 of the Companies Act, 2013 and Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. The Company laid down a Nomination and Remuneration Policy, which was duly approved by the Board in its meeting held during the year under review. The remuneration in all forms that would be paid to the Managing Directors would be in compliance with the said policy. The remuneration to Non–Executive Independent Directors in the form of commission and sitting fees would also be paid in terms of the said policy. The disclosure of the details of the Remuneration Policy forms part of the Corporate Governance Report.

11. Particulars of loans, guarantees or investment

Disclosures relating to the Loans, Guarantees or Investments, as defined under Section 186 of the Companies Act, 2013, forms part of the notes to the Financial Statement.

12. Vigil mechanism

A Vigil Mechanism in the form of an Ethics Helpline and Whistle Blower Policy was established by the Company to trace and deal with instances of fraud and mismanagement. The details/report for the same was directly reported to  the Audit Committee Chairman. A brief note on the Whistle Blower Policy is disclosed in the Corporate Governance report; the policy is also posted on the Company's website.

13. Internal control systems and their adequacy

The Company has satisfactory internal control systems, which are continuously evaluated by professional internal and statutory auditors of repute. The company continues to improve the present internal control systems by implementation of appropriate policy and processes. The Company is focused on incorporating the controls and checks in ERP system of SAP.

14. Business risk management

There exists good opportunities in Export in both OEM and Aftermarket segments. By establishing network in all six continents, Gabriel has taken steps to capitalise on in this opportunity.

In the domestic market, there exists an opportunity of increasing business shares through consistent delivery of quality and innovative new products. Gabriel has already embraced innovation as a key initiative which will help in the above.

The entry of Global OEM's in heavy commercial vehicle segment is likely to bring in a positive change in terms of product performance, reliability and safety. Your company's leadership position in this segment will hold it in good stead.

In the competitive auto environment like most Tier– I industries Gabriel also has several threats. The new competition in the suspension industry is going to put pressure for developing competitive products with high performance, quality and longer life. Most of the OEM's are trying to leverage upon these aspects to sell more vehicles.

The Company's business is exposed to many internal and external risks. To address same in a systematic manner, Company had engaged an external professional agency to help identify key risks for the organisation. They have interviewed more than 30 senior officials & identified key risks faced by organisation. The some of the key risks identified are threat to market share due to global competition, procurement of few components, talent acquisition, technology, regulatory compliance. The risks have been reviewed by senior management and short term & long term risk mitigation plans have been identified. A Risk Committee has been formed under Chairmanship of CFO which will meet quarterly & present the progress on mitigation plans to the Board.

The Key risks of the organisation are:

(i) Threat to market share due to Global competition

Due to growing Indian market, global players have started operations in India which poses a strong competition for new business. To compete with these competitors, company is focusing on cost reduction with centralised sourcing. The company will also focus on technology upgrade and R & D is working closely with the customers to offer customised solutions. We are also exploring for a technology partner in the Commercial Vehicle segment. The company is also focusing on improving its product quality with focus on internal manufacturing and vendor processes.

(ii) Procurement Risk

As the company is spread across India, it leads to dependency on small localised vendors. For some key parts, the company operates with few single sourced suppliers which pose threat of production continuity.

Company is taking adequate steps like vendor rationalisation by consolidating requirement at pan

India level thereby reducing dependency on small local vendors looking into aggressive growth plans. The company has also initiated actions for mapping the capabilities of the vendors on various parameters. It proposes to evaluate same for plugging the risks and rationalising of vendor base.

(iii) Risk of Global Competition in Exports

Looking into vast export potential in OEM as well as After Market segment, exports is one of the key focus areas for the company. To achieve aggressive export targets drawn for next 5 years, company forecasts concern over inducting technology or produce designs in line with target market requirements.

Technology road map is in place for these requirements for the next 5 years and work has already commenced. We have also mooted a strong drive to improve quality of current products to compete in Global markets.

(iv) Talent Acquisition Risk:

Attracting & retaining talent is key area for the management & various activities are carried out like effective induction, continuous training & management interactions to keep the attrition under control. Besides rewards & recognition company tries to enhance the engagement with the team through learning opportunities, 360 degree feedback & cross functional exposure.

(v) Technology Risk:

The company will continue to face strong competition from domestic and foreign players in this segment on latest and developing technology. To mitigate said risk, our company has a strong base in technology and also works with different technology support partners in different segments on different platforms. Our R & D efforts are oriented towards improvement in existing product & process capability that can produce value added products at competitive cost.

(vi) Regulatory & Compliance Risk

As the company operations are spread over the country and are exposed to various compliance requirements of different laws and statutes. The Company is conscious of said risk and has a proper & adequate system of internal control to review and monitor compliances. The internal control system is supplemented by an extensive programme of internal audits, reviews of the findings by management & also assesses opportunities for improvement in business processes, systems & controls for regulatory compliance.

The company will be monitoring above and other risks on a regular and systematic basis.

15. Related party transactions

Pursuant to the requirement of Section 188 of the Companies Act, 2013 and Clause 49 of the Listing Agreement entered by the Company with the Stock Exchanges, the Company established a Related Party Transaction Policy, which intends to ensure the proper approval and reporting of transactions between the Company and related parties. Such transactions are held to be appropriate only if they are in the best interest of the Company and its shareholders.

All the related party transactions of the Company were routed through the said policy and through the Audit Committee as per the requirements of the Companies Act, 2013. A policy on the related party transactions, duly approved by the Board, was posted on the website of the Company.

The Company is required to disclose in the Financial Statements certain transactions between the Company and related parties as well as policies concerning transactions with related parties. Accordingly, the particulars, as required to be disclosed under Section 188 (1) of the Companies Act, 2013 read with rule 8 (2) of the Companies (Accounts) Rules, 2014, were annexed as Annexure B to the report in Form  AOC 2.

16. Corporate social responsibility

The Company invested in corporate social responsibility initiatives for societal betterment. It continued to work actively in enhancing life quality and enabling livelihoods as a responsible corporate citizen. The Company supported social initiatives through field level activities, which helped foster a 'spirit of giving' among neighbourhood corporates/ partners. The Company invested in vocational training, health and educational accessibilities. All activities were conducted through the Sant Nischal Singhji Foundation. SNS Foundation is a charitable Trust which has been sanctioned tax exemption under Income Tax Act, 1961. Its  activities are aimed at skills development for employability and empowerment of women, elementary education of most unreached categories of children living in slums, etc. This includes actions for preventing spread of HIV/AIDS amongst migrants and industrial workers. SNS Foundation is a social engagement arm of Anand Group.

The company has spent H10.85 Million on CSR Activities as required by the Act. Further, as per the requirement of Section 135 of the Companies Act, 2013, the Company constituted a CSR Committee and CSR Policy to track related transactions and initiatives. The detailed policy was posted on the Company's website. Further, the detailed report on the CSR activities is annexed as 'Annexure C'.

17. Sustainable development

The Company is working towards making the world greener and cleaner. The Company embarked on extensive tree planting in 2011, an activity that has sustained. It harnessed renewable energy through a solar park in Chakan plant, invested in eco–friendly paint line equipment, reduced energy consumption, sourced green wind energy, utilised waste heat to improve equipment efficiency and focused fossil fuel conservation.

18. Technology

The Company continued to collaborate with KYB Japan and YHSJ for various models on a platform basis. During the year under review, the Company signed a technical license agreement with KONI B.V. to deliver high technology automotive products to the Indian market in lesser time. KONI develops, manufactures and markets high performance shock absorbers for all types of cars and commercial vehicles.

The Company continued to invest in R&D and testing facilities to facilitate robust design, faster new products launch and higher customer satisfaction, which was reflected in awards from OEM customers.

The Company intends to emerge as a complete solutions provider for suspension systems. In line with this stated goal, the Company developed a new R&D Centre for two–wheelers at Hosur in December 2013. The Company has a dedicated R&D facility for passenger cars and commercial vehicles in Pune. These Centres will generate advanced products and features following robust testing with the objective to deliver reliable defect–free products. The Centres provided research professionals with a creative and innovative environment that enhances the speed, responsiveness and quality of product development leading to stronger customer satisfaction.

19. Conservation of energy, technology absorption and foreign exchange earnings and outgo

As required under Section 134(m) of the Companies Act, 2013, read with the Companies (Accounts) Rules 2014, information relating to the foregoing matters is given by way of an Annexure D to this Report.

20. Employee relations

'Gabriel India Limited' has been recognised by Great Place To Work® as one of India's Best Companies To Work For –2015, and has been ranked as the Best Place to Work in the industry and amongst the Top 50 Companies to Work for in India. The Great Place To Work® ranking is considered the most definitive employer–of–choice and workplace quality recognition that an organisation can receive. We believe that being a great workplace is a way of life and is a continuous journey.

To achieve higher productivity levels and employee value addition we have taken many initiatives for our Operating Engineers and Staff. These initiatives include skill enhancement, technical training and soft skills development.

With the aim of preparing the company for high growth in the coming year, we have continued emphasis on focused coaching & guidance for our talent pool. The Company continues its initiative in employee development by way of the leadership programme, Anand Leadership Development Programme (ALDP), with support from the Anand Group.

We have also initiated a Behavioral Model pledge during our annual goal setting exercise, to inculcate the core value of "delivery on promise".

Further, employee relations remain cordial at all locations.

21. Significant and material orders passed by the regulators or courts

There were no significant material orders passed by the regulators or courts having competent jurisdiction, which  could have an impact on the business of the Company under the going concern concept.

22. Corporate governance report

A separate section on Corporate Governance is included in the Annual Report and the Certificate from the Company's Auditors, confirming the compliance of conditions of Corporate Governance as stipulated under Clause 49 of the Listing Agreement with the Stock exchanges, is annexed thereto.

23. Auditors Statutory Auditors

BK Khare & Co., Chartered Accountants, Auditors of the Company, will retire at the conclusion of the ensuing Annual General Meeting and are eligible for re–appointment. They have furnished a Certificate under Section 141 of the Companies Act, 2013 to the effect that the proposed appointment, if made, would be in accordance with Sections in Companies Act, 2013

Secretarial Audit

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company appointed KPRC & Associates, a firm of Company Secretaries in practice, to undertake the Secretarial Audit. The Self Explanatory report of the Secretarial Audit is annexed herewith as 'Annexure E'. The Company is taking action for filing an E–Form MGT–14.

24. Extract of annual return

The extract of the Annual Return as per Section 92 (3) of the Companies Act, 2013 and Rule 12 (1) of the Companies (Management and Administration) Rules, 2014 in the form MGT 9 is annexed herewith as 'Annexure F'.

25. Particulars of employees

As required under Section 197 of the Companies Act, 2013 read with rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the particulars of employees were set out. In terms of Section 136 of the Companies Act, 2013, the report and accounts were sent to members and others entitled thereto, excluding information on employees' particulars, which are available for inspection by members at the registered office of the Company during business hours on working days of the Company upto the date of ensuing Annual General Meeting.

26. Directors' responsibility statement

To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statements in terms of Section 134 (3) (c) of the Companies Act, 2013:

1. In preparation of the annual accounts the applicable accounting standards have been followed along with proper explanation relating to material departures

2. The Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent, to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the Profit and Loss Account of the Company for that period

3. The Directors have taken proper and special care for the maintenance of adequate accounting records in accordance with the provisions of this act for safeguarding the assets of the Company and for preventing / detecting fraud and other irregularities

4. The Directors have prepared the annual accounts on a going concern basis

5. The Directors, in case of a listed Company, have laid down internal financial controls followed by the Company and such financial controls are adequate and operating effectively

6. The Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively

27. Acknowledgements

Your Directors wish to thank the collaborators, technology partners, financial institutions, bankers, customers, suppliers, shareholders and employees for their continued support and co–operation.

For and on behalf of Board

Mrs. Anjali Anand

(DIN 02082840)


Date : May 20, 2015

Place : Pune