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MOTORS

6th ANNUAL REPORT 2003-2004

HERO MOTORS LIMITED

(Formerly Hero Auto Limited) Period from 01.04.2003 to 30.09.2004 (18 Months)
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MOTORS

Annual Report 2003-2004 AUDITORS M/s B.D. Bansal & Co. Chartered Accountants. Amritsar, New Delhi, Ludhiana COST AUDITORS M/s. Ramanath Iyer & Co. Cost Accountants, Delhi. BANKERS Punjab National Bank Canara Bank Citibank N.A. ICICI Bank REGISTERED OFFICE 601, International Trade Tower Nehru Place, New Delhi-110019 WORKS

BOARD OF DIRECTORS Sh. O.P. Munjal Chairman Managing Director Sh. Pankaj Munjal Sh. S.D. Khosla Sh. G.P. Sood Sh. Sandeep Dinodia Sh. Yogesh Munjal Sh. Ashok Munjal Sh. Sunil Kant Munjal CHIEF OPERATING OFFICER Sh. P.V.V. Srinivasa Rao FINANCIAL ADVISOR Sh. A.K. Dewan

GENERAL MANAGER (ACCOUNTS)

Sh. Bhawnesh Vij COMPANY SECRETARY Sh. Ajay Pratap AUDIT COMMITTEE Sh. Sandeep Dinodia Sh. G. P. Sood Sh. S. D. Khosla Sh. Pankaj Munjal REMUNERATION COMMITTEE Sh. G.P. Sood Sh. S. D. Khosla Sh. Sandeep Dinodia Sh. Yogesh Munjal SHAREHOLDERS/ INVESTORS GRIEVANCES COMMITTEE Sh. S. D. Khosla Sh. Sandeep Dinodia Sh. G. P. Sood Sh. Pankaj Munjal INVESTMENT COMMITTEE Sh. S. D. Khosla Sh. G. P. Sood Sh. Yogesh Munjal Sh. Pankaj Munjal

10km Stone, P.O. Dujana Dadri, Dist Gautambudh Nagar, Ghaziabad. U.P.-203207 SHARE TRANSFER AGENT M/s. Alankit Assignments Ltd. 205-208, Anarkali Complex, Jhandelwalan Extension, New Delhi-110055

CONTENTS Page No. Notice 1 Directors' Report 4 Auditors' Report 11 Annexure to Auditors' Report 12 Balance Sheet 15 Profits Loss Account 16 Schedules 17 Information pursuant to Part IV of Schedule VI to the Companies Act, 1956 32 Cash Flow Statement 33 Proxy Form & Attendance Slip 34

Annual Report period is 01.04.2003 to 30.09.2004 (18 Months)

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Annual Report 2003-2004

HERO MOTORS LIMITED

(Formerly known as Hero Auto Ltd.) NOTICE Notice is hereby given that the 6th Annual General Meeting of the members of HERO MOTORS LIMITED will be held on Wednesday, the 22nd day of December, 2004 at 9.30 AM at Tivoli Garden Resort, Chattarpur Mandir Road, New Delhi-110030 to transact the following business: ORDINARY BUSINESS 1. To receive, consider and adopt the Audited Balance Sheet of the Company as at September 30, 2004 and the Profit & Loss account for the period ended on that date together with the reports of the Directors and Auditors thereon. 2. To appoint a director in place of Shri Yogesh Munjal, who retires by rotation and being eligible offers himself for reappointment. 3. To appoint a director in place of Shri Ashok Munjal, who retires by rotation and being eligible offers himself for reappointment. 4. To appoint Auditors and to fix their remuneration. M/s. B.D.Bansal& Co., Chartered Accountants, the retiring auditors are eligible for appointment. SPECIAL BUSINESS To consider and, if thought fit, to pass, with or without modification(s), the following resolutions: As Ordinary Resolutions: 5. Appointment of Sh.S.D. Khosla as Director "RESOLVED THAT Shri S. D. Khosla who was appointed as an additional director of the Company by the Board of Directors in terms of Section 260 of the Companies Act, 1956 w.e.f. August 30, 2004 and in respect of whom the company has received a notice from a member under Section 257 of the Companies Act, 1956, be and is hereby appointed as director of the Company, liable to retire by rotation." 6 Appointment of Sh.G.P. Sood as Director "RESOLVED THAT Shri G.P. Sood who was appointed as an additional director of the Company by the Board of Directors in terms of Section 260 of the Companies Act, 1956 w.e.f. August 30,2004 and in respect of whom the company has received a notice from a member under Section 257 of the Companies Act, 1956, be and is hereby appointed as director of the Company, liable to retire by rotation." 7. Appointment of Sh.SandeepDinodia as Director "RESOLVED THAT Shri Sandeep Dinodia who was appointed as an additional director of the Company by the Board of Directors in terms of Section 260 of the Companies Act, 1956 w.e.f. August 30,2004 and in respect of whom the company has received a notice from a member under Section 257 of the Companies Act, 1956, be and is hereby appointed as director of the Company, liable to retire by rotation." 8. Approval of appointment of Sh. Pankaj Munjal as Managing Director "Resolved that pursuant to the provisions of Section 269 read with Schedule XIII and Section 316 of the Companies Act, 1956, approval be and is hereby accorded to the appointment of Sh. Pankaj Munjal as Managing Director of the company for a period of 5 years w.e.f. September 3,2004." "Resolved further that Sh. Pankaj Munjal will not be paid any remuneration until otherwise decided subsequently by the Board of Directors on the basis of recommendations of the Remuneration Committee." By order of the Board For HERO MOTORS LIMITED O. P. MUNJAL CHAIRMAN

New Delhi, 26th November, 2004 Registered Office: 601, International Trade Tower, Nehru Place, New Delhi-110019 Annual Report period is 01.04.2003 to 30.09.2004 (18 Months)

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MOTORS

Annual Report 2003-2004

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NOTES: 1. A Member entitled to attend and vote at the meeting is entitled to appoint any other person as his/her proxy to attend and vote (in case of poll) instead of himself/herself at the meeting. A proxy need not be a member of the Company. 2. A proxy form is sent herewith. The proxy form duly completed must be received at the registered office of the Company not less than forty eight hours before the meeting. 3. 4. The explanatory statement setting out the material facts concerning Special Business at items No. 5 to 8 of the accompanying notice as required by section 173(2) of the Companies Act, 1956, is annexed hereto. The Register of Members and Share Transfer Books of the company will remain closed from 15th December, 2004 to 22nd December, 2004 (both days inclusive).

5. All documents referred to in the accompanying notice are open for inspection at the registered office of the company during office hours upto the date of the Annual General Meeting. 6. Pursuant to the provisions of section 109A of the Companies Act, 1956, every shareholders or joint holders may nominate, in the prescribed manner, a person to whom all the rights in the shares shall vest in the event of death of the sole holder or all the joint holders. Pursuant to the Scheme of Arrangement between Majestic Auto Ltd. (Transferor Company) and Hero Motors Ltd. (Transferee Company), as sanctioned by Hon'ble High Court of Punjab & Haryana on 29th May, 2004 and by Hon'ble High Court of Delhi on 22nd July, 2004 read with revised order dated 30th July, 2004 the Ghaziabad unit of the Transferor Company has been demerged from Majestic Auto Ltd. and merged with the Transferee Company i.e Hero Motors Ltd. with effect from the appointed date i.e. 01.04.2003. In accordance with the Scheme of Arrangement 11,26,142 equity shares have been allotted proportionately to the shareholders of Majestic Auto Ltd. on 06.10.2004. In pursuance of the option given to the persons entitled forO% FCDs as per the scheme of arrangement between Majestic Auto Ltd. & Hero Motors Ltd., the entitlement of 0% FCDs of Rs. 35 Crore have been converted into 3,50,00,000 equity shares of Rs. 10/each.

7.

8.

9. The name of the company has been changed from Hero Auto Ltd. to Hero Motors Ltd. vide fresh certificate of incorporation dated 15th September, 2004 issued by Registrar of Companies, NCT of Delhi & Haryana, New Delhi. 10. The financial year 2003-2004 of the company has been extended to 18 months i.e. the Financial Year is from 01.04.2003 to 30.09.2004 vide special approval dated 13th July, 2004 accorded by Registrar of Companies, NCT of Delhi & Haryana, New Delhi. 11. The Shares of the Company are admitted in depository system with NSDL and CDSL. 12. Members are requested to notify immediately any change of address to their depository participant in respect of their electronic share account and in respect of physical shares, to the Company's Registrar M/s. Alankit Assignments Ltd. 205208, Anarkali complex, Jhandelwalan Extension, New Delhi -110055, quoting their folio number. 13. Shareholders holding shares in electronic form are advised to update particulars of their Bank Account details to their depository Participants. Further, instructions, if any, already given by them in respect of shares held in physical form will not be automatically applicable to shares held in electronic form. 14. The Shares of the Company are not listed on any Stock Exchange. 15. The members are requested to bring the copy of Annual Report and Attendance Slip duly filled in to the Annual General Meeting. EXPLANATORY STATEMENT PURSUANT TO SECTION 173(2) OF THE COMPANIES ACT, 1956. Item No.5 Sh. S.D. Khosla was appointed as an additional director of the company by the Board of Directors in their meeting held on 30th August, 2004 and holds office as such upto the forthcoming Annual General Meeting of the company. Sh. S.D. Khosla is B.Sc., C.A.IIB. He is ex-Executive Director of Industrial Development Bank of India. He possesses experience in the field of Development Banking. The company has received a notice from a member under section 257 of the Companies Act, 1956 proposing candidature of Sh. S.D. Khosla as director of the company. The Board recommends his appointment at the forthcoming Annual General Meeting. Annual Report period is 01.04.2003 to 30.09.2004 (18 Months)

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MOTORS

Annual Report 2003-2004

None of the directors except Sh. S.D. Khosla is interested in passing of this resolution. Item No.6 Sh. G.P. Sood was appointed as an additional director of the company by the Board of Directors in their meeting held on 30th August, 2004 and holds office as such upto the forthcoming Annual General Meeting of the company. Sh. G.P. Sood, a Post Graduate in political science and holding degree in Law has vast experience in Banking, Accounts & Finance. He is former Deputy General Manager of Bank of India, Hong Kong branch and has held the position of Chief Manager for Hongkong branches of Bank of India. Sh. G.P. Sood has also held the position of Chief Executive Officer of Commonwealth Finance Corporation Ltd for Hongkong under the Management of Bank of India. Sh. G.P. Sood is an associate member of Certificated Indian Institute of Bankers (CAI IB) and is holding the position of Director in Majestic Auto Ltd. The company has received a notice from a member under section 257 of the Companies Act, 1956 proposing candidature of Sh. G.P. Sood as director of the company. The Board recommends his appointment at the forthcoming Annual General Meeting. None of the directors except Sh. G.P. Sood is interested in passing of this resolution. Item No.7 Sh. Sandeep Dinodia was appointed as an additional director of the company by the Board of Directors in their meeting held on 30th August, 2004 and holds office as such upto the forthcoming Annual General Meeting of the company. Sh. Sandeep Dinodia, is a fellow member of the "Institute of Chartered Accountants of India", and holds a Law degree from Delhi University, along with an honors degree in commerce from Shri Ram College of Commerce, New Delhi. He is also a member of the Institute of Internal Auditors, USA. Sh. Sandeep Dinodia has vast experience in the field of Direct Taxes (Both National & International), Company Law, Indian GAAP, Management Assurance (Auditing), Corporate planning & business restructuring. He is a senior partner of S.R. Dinodia & Co., an eminent Chartered Accountants firm based in New Delhi. The company has received a notice from a member under section 257 of the Companies Act, 1956 proposing candidature of Sh. Sandeep Dinodia as director of the company. The Board recommends his appointment at the forthcoming Annual General Meeting. None of the directors except Sh. Sandeep Dinodia is interested in passing of this resolution. Item No.8 Sh. Pankaj Munjal has graduated in Science and underwent specialized training in Automotive Manufacturing at General Motors Institute, Flint in USA. After going through a rigorous training and induction program at the shop floor with Hero Cycles Ltd. & Majestic Auto Ltd., Sh. Pankaj Munjal was appointed as an Executive Director of Majestic Auto Ltd. Subsequently he was elevated as Managing Director from 1st July 1999 and had been managing the erstwhile Ghzaiabad Unit of Majestic Auto Ltd. Sh. Pankaj Munjal takes an active interest in the promotion of businesses domestically and globally. He is currently the Chairman of Europe Committee in PHD Chamber of Commerce and Industry and Executive Committee Member of SIAM, apex body of the Automotive Industry. Since, Sh. Pankaj Munjal is closely associated with the Ghaziabad Unit, after resignation of Sh. Pankaj Munjal as Managing Directors of Majestic Auto Ltd., the Board of Directors of the Company appointed Sh. Pankaj Munjal as Managing Director of the company in their meeting held on 3rd September, 2004. The Board recommends approval of the resolution by the members. None of the directors except Sh. O.P. Munjal and Sh. Pankaj Munjal is interested in passing of this resolution. By order of the Board For Hero Motors Limited O. P. MUNJAL CHAIRMAN Annual Report period is 01.04.2003 to 30.09.2004 (18 Months)

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MOTORS

Annual Report 2003-2004 DIRECTORS' REPORT

Dear members, Your Directors have pleasure in presenting the 6th Annual Report together with the Audited Statement of Accounts for the period ended 30th September, 2004. 1. FINANCIAL RESULTS The salient features of the Company's financial results for the period under review are as follows: (Rs. in lacs) Period ended 30.09.2004 (18 Months) Sales and other income Gross Profit/(Loss) Depreciation Profit/(Loss) before tax Provision for taxes Profit/(loss) after tax Prior period item Prior year tax adjustments Profit/ (loss) brought forward Profit/(loss) b/f from Demerger Scheme Transitional cumulative amortisation Transitional cumulative deferred Tax Year ended 31.03.2003 (12 Months)

"Tesos.Ve"
(3854.60) (1748.79) (5603.40)

(117.45)
(116.13) (233.58) (472.35) (705.93) (0.13)
NIL

(53.15) (5656.55)
12.64 (0.80) (111.19) (966.98) (92.86)
NIL

70.36
NIL NIL

524.51

(6815.74) Profit/(Loss) carried to Balance Sheet (111.19) 2. OPERATIONS The Company achieved a turnover of Rs. 16308.86 lacs during the period ended 18 months under review comprising of sale of vehicles, components, spares etc. as compared to Previous Year turnover of Rs. 1218.26 lacs. The Company suffered net loss before tax of Rs. 5603.40 lacs for the period ended 18 months as compared to loss before tax of Rs. 233.58 lacs in the previous year ended 31.03.2003 for 12 months. 3. ACCOUNTS The Accounting Year 2003-04 of the company has been extended to 18 months i.e. current period ended 18 months from 01.04.2003 to 30.09.2004 as approved by the Registrar of Companies, New Delhi vide its letter dated 13th July, 2004 The figures for the period ended 30.09.2004 consist of the figures of Ghaziabad Unit, erstwhile unit of Majestic Auto Ltd. and merged with the company as per the Scheme of Arrangement between Majestic Auto Ltd. and Hero Motors Ltd., and the figures for the year ended 31.03.2003 consist of the company alone (i.e. excluding the Ghaziabad Unit). Besides above, the figures of the Current Accounting Period for the period ended 30.09.2004 consist of 18 months and the figures of the Previous Year for the period ended 31.03.2003 consist of 12 months. In view of above, the figures of the Current Accounting Period and the Previous Accounting Year are not comparable. 4. CAPITAL STRUCTURE Authorised share capital During the period under review, the Authorised Share Capital of the company was enhanced from Rs. 50,00,00,000 (Rupees fifty crores) to Rs. 111,50,00,000 (Rupees one hundred eleven crores fifty lacs only) divided into 6,20,00,000 equity shares of Rs. 10/- each and 4,95,00,000 preference shares of Rs. 10/- each. Issued and subscribed capital a.) During the period under review, in pursuance of the option given to the persons entitled for 0% FCDs as per the scheme of arrangement between Majestic Auto Ltd. & Hero Motors Ltd., the entitlement of 0% FCDs of Rs. 35 Crore have been converted into 3,50,00,000 equity shares of Rs. 10/- each.
Annual Report period is 01.04.2003 to 30.09.2004 (18 Months)

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Annual Report 2003-2004 Further, during the period under review, company issued 4,95,00,000, 6% Non-cumulative Convertible Redeemable Preference Shares of Rs. 10/- each on private placement basis. 5. DIVIDEND In view of the losses suffered during the period ended 18 months under review, your directors are unable to recommend any dividend. 6. FUTURE PROSPECTS In view of the emerging scenario world-over, the company is focusing on auto component business and trying to evolve as an integrated system solution provider, means end-to-end solutions, or design to parts for the automobile industry in domestic and international market. The company is in touch with leading international automobile manufactures to cater to their need at low cost with high quality components. The company is also proposing to acquire sizeable chunk of domestic auto components business to strengthen its presence in auto component industry. The company has been successfully supplying Swing Arms, Painted components, Chain Case, Cylinder Block, Main Stand and Side Stand to Hero Honda Motors Limited and plans to enhance volume of these components in the near future apart from the exploring the possibilities of developing more components for them. The company is also exploring the possibility of supplying cylinder, piston and crankshaft for compressor to other consumer durables industry. Further, the company during the period signed long term supply agreement with leading overseas auto manufacturer. This will give continuous business on sustainable basis. In view of the sharp decline in the moped segment in the country, the company will be focusing on auto parts business for the growth of the company. 7. DIRECTORS Shri Yogesh Munjal and Shri Ashok Munjal retire by rotation at the ensuing Annual General Meeting and are eligible for reappointment. The Board recommends their re-appointment. Shri S.D. Khosla. Shri G.P. Sood and Shri Sandeep Dinodia have been appointed as additional directors of the company w.e.f 30.08.2004. The company has received notice(s) from the member(s) proposing their candidature for the office of the director of the company. The Board recommends their appointment at the Annual General Meeting. Shri Pankaj Munjal has been appointed as Managing Director of the company w.e.f. 03.09.2004. The Board recommends approval of appointment by the members at the ensuing Annual General Meeting. Sh. Roshan Lall who was appointed as Manager of the company w.e.f. 10.11.2003. , has resigned as manager w.e.f. 03.09.2004. None of the directors is disqualified as per the provisions of Sec. 274(1 )(g) of the Companies Act, 1956. 8. DIRECTORS RESPONSIBILITY STATEMENT In compliance of Section 217(2AA) of the Companies Act, 1956, the Directors confirm: that in the preparation of the annual accounts for the period ended September 30, 2004, the applicable accounting standards have been followed; that appropriate accounting policies have been selected and applied consistently and judgments and estimates that are reasonable and prudent have been made so as to give a true and fair view of the state of affairs at the end of the period and of the loss of the company for the period ended September 30,2004; that proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities; that the annual accounts for the period ended 30th September, 2004 have been prepared on going concern basis. 9. AUDITORS M/s B.D. Bansal & Co., Chartered Accountants, existing Auditors of the company will retire at the conclusion of the forthcoming Annual General Meeting and being eligible offer themselves for re-appointment. The company has received a certificate from the Auditors to the effect that their appointment, if made, would be in accordance with Section 224 (1 B) of the Companies Act, 1956. The Board recommends their re-appointment. 10. SCHEME OF ARRANGEMENT In accordance with the Scheme of Arrangement between Majestic Auto Ltd. (Transferor Company) and Hero Motors Ltd. (Transferee Company), sanctioned by Hon'ble High Court of Punjab & Haryana on 29th May, 2004 and Hon'ble High Court of Delhi on 22nd July, 2004 read with revised order 30th July, 2004, the Ghaziabad unit of the Transferor Company, with all assets and liabilities, has been demerged from Majestic Auto Ltd and merged with the Transferee Company i.e Hero Annual Report period is 01.04.2003 to 30.09.2004 (18 Months) b.)

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Annual Report 2003-2004 Motors Ltd., with effect from the appointed date i.e. 01.04.2003. The Scheme of Arrangement has become effective from 27th August, 2004.

11. CHANGE OF NAME OF THE COMPANY

The name of the company has been changed from Hero Auto Limited to Hero Motors Ltd. vide fresh certificate of Incorporation dated 15th September, 2004 issued by Registrar of Companies, NCT of Delhi & Haryana, New Delhi. 12. FIXED DEPOSITS During the period under review the company has not invited or accepted any deposit under Section 58A of the Companies Act, 1956, read with Companies (Acceptance of Deposits) Rules, 1975. 13. CORPORATE GOVERNANCE Your company has been practicing the principles of Corporate governance over the years. The Board of Directors supports the broad principles of Corporate Governance in addition to the basic governance issue. The Board lays strong emphasis on transparency, accountability and integrity. 14. AUDIT COMMITTEE OF THE BOARD The Board has constituted the Audit Committee of the Board. The committee consists of the following directors: Non Executive Directors 1. Sh. Sandeep Dinodia 2. Sh. S.D. Khosla 3. Sh. G.P. Sood Executive Director Sh. Pankaj Munjal 15. SHAREHOLDERS GRIEVANCE COMMITTEE The Board has constituted the Shareholders Grievance Committee of the Board. The committee consists of the following directors: Non Executive Directors 1. Sh. S.D. Khosla 2. Sh. Sandeep Dinodia 3. Sh. G.P. Sood Executive Director Sh. Pankaj Munjal 16. REMUNERATION COMMITTEE The Board has constituted the Remuneration Committee of the Board. The committee consists of the following directors: Non Executive Directors 1.Sh. G.P. Sood 2. Sh. S. D. Khosla 3. Sh. Sandeep Dinodia 4. Sh. Yogesh Munjal 17. INVESTMENT COMMITTEE The Board has constituted the Investment Committee of the Board. The committee consists of the following directors: 1.Sh. S.D. Khosla 2. Sh. G. P. Sood 3. Sh. Yogesh Munjal Executive Director 4. Sh. Pankaj Munjal Annual Report period is 01.04.2003 to 30.09.2004 (18 Months) Chairman Chairman Chairman

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MOTORS

Annual Report 2003-2004

18. EXIT OPTION TO MINORITY SHAREHOLDERS As per the provision made in the Scheme of Arrangement between Majestic Auto Ltd. and Hero Motors Ltd., the minority shareholders of Majestic Auto Ltd. have been given an exit option, through a group company, to continue or exit as equity shareholders of Majestic Auto Ltd. and Hero Motors Ltd., subject to a maximum of 10% of the total paid up capital of the respective companies. In pursuance of this, an exit option by Group Company was given to the shareholders of Majestic Auto Ltd. and Hero Motors Ltd. to continue or exit as equity shareholders of Majestic Auto Ltd. and Hero Motors Ltd. The exit option has been closed on the 25th October 2004. Total 259 shareholders have exercised the option, for which the papers received from shareholders are being scrutinised.

19. COST RECORDS* COST AUDITOR

The Company has maintained Cost Accounts Records as prescribed under Cost Accounting Rules 1968. The directors have appointed M/s. Ramanath Iyer & Co. as Cost Auditors for the year 2004-2005 subject to the approval of the Central Government. 20. AUDITOR'S REPORT i.) As mentioned in para (xi) of the annexure to Auditors Report, the Company has suffered cash losses due to lowering demand of mopeds in the country and the Company is taking adequate steps to improve the position by new business orientations. Further, as mentioned in para (xviii), the use of long term funds is a temporary phenomenon for which steps are being taken by the Company to address the same in view of new business orientations. ii.) The other observations made in the Auditor's Report and in the notes to the accounts are self-explanatory and hence do not call for any further commentST 21. INSURANCE All properties and insurable assets of the Company including building, plant and machinery and stock have been adequately insured, wherever necessary, and to the extent required. 22. OTHER COMPLIANCE The Company has already taken and further initiated steps to strengthen the net worth by adding new line of business and other measures. Though technically Section 23 of SICA is applicable to the company, however, the net worth of the company is positive significantly to the tune of Rs. 41 crores. The necessary compliance in this connection will be made to the appropriate statutory authorities. 23. PARTICULARS OF EMPLOYEES The information required under Section 217 (2A) of the Companies Act, 1956 read with Rules framed there under is given as Annexure - A and form part of this report. 24. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND RESEARCH & DEVELOPMENT AND FOREIGN EXCHANGE EARNINGS & OUTGO & PARTICULARS OF EMPLOYEES The information pursuant to sections 217( 1 )(e) of the Companies Act, 1956 regarding Conservation of Energy, technology absorption, R&D and foreign exchange earnings & outgo is annexed as Annexure - B and forms part of the report. 25. ACKNOWLEDGMENT The Board takes this opportunity to convey its appreciation and gratitude towards Hero Group for the support and cooperation extended to the Company. The Board also expresses its appreciation towards the contribution of its employees, govt. depts., Banks etc. for the period under review. For and on behalf of the Board of Directors For Hero Motors Limited

O.P. MUNJAL Chairman Place: New Delhi Date: November26,2004 Annual Report period is 01.04.2003 to 30.09.2004 (18 Months)

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Annual Report 2003-2004

Annexure-A to Directors Report

Statement of Particulars of Employees pursuant to the provisions of section 217(2A) of the Companies Act, 1956 and the Companies (Particulars of Employees)Rules, 1975 forming part of the Director's Report for the period ended 30.09.2004 A. Employed throughout the Period Name of the Employee Designation Nature of Duty Gross Remuneration Qualification Experience (Years) Share Holding % (Nos.)
NIL

Date of Joining

Age

Last Employment held before Joining Company Associate Vice President (Customer Development) Electrolux Kelvinator Limited

Mr. P.V.V. Srinivasa Rat

Chief Operating Officer

As a Chief of operations including Business planning, strategic management, new projects and product marketing etc.

44,16,931

B.Tech MBA

11

01.01.03

36

B. Part of the Period : Notes:

NONE

1. Information has been furnished on the basis of employees employed throughout the period, who were in receipt of remuneration for that period which, in the aggregate, was not less than Rs. 24,00,0007- (Rupees Twenty Four Lacs). None of the employee worked part of the Financial Year, who were in receipt of remuneration for any part of that period at a rate which, in the aggregate was not less than Rs. 2,00,000 (Rupees Two Lacs) per month. There was no person employed either throughout the financial year or part thereof, who was holding either himself or along with the spouse and dependent children 2% or more of the shares of the company and drawing in excess of the remuneration drawn by the Managing Director or Manager. 2. Remuneration includes salary, other allowances, payment and expenditure incurred on perquisites and Company's contribution to provident fund, superannuation fund and gratuity fund. 3. All appointments are / were non contractual and terminable by notice on either side. 4. Mr. P.V.V. Srinivasa Rao is not relative of any director or manager of the company. Annual Report period is 01.04.2003 to 30.09.2004 (18 Months)

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