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Prepared by:

Nirmal Sakhrani Janki V Garg Kishan Gupta Rahul Ranadive Dharmin Bhikadiya

Hero Honda started in 1984 as a joint venture between Hero

Cycles of India, Honda of Japan, HIPL and BCIPL In August 2011 the company was renamed Hero MotoCorp with a new corporate identity. The successful association of Hero and Honda for 27 years created the worlds largest two wheeler manufacturing company. The company is the largest two wheeler manufacturer in India.

No. 1 two Wheeler Company in the world for the 10th consecutive

year. 50 million two wheelers sold. 54.6% share in the domestic motorcycle market 6 new products launched in 2010-11(including variants). Upgrade versions of Glamour, Glamour FI,CBZ Xtreme,Karizma.

The story of Hero Honda began with a simple vision the vision

of a mobile and an empowered India, powered by its bikes.

Hero MotoCorps mission is to become a global enterprise

fulfilling its customers needs and aspirations for mobility, setting benchmarks in technology, styling and quality so that it converts its customers into its brand advocates.

Directors Report
Particular 2009-2010 2010-2011 Increase/ Decrease 17.44% increase

The margin fell because higher

Sale in Unit



Sale in Value
Total Income PAT

15,758.18 corer
16,098.79 corer 2,231.83 corer

19,245.03 corer
19,669.90 corer 1,927.90 corer

22.13% increase
22.18% increase 13.62% decrease

prices of raw materials and components Interim dividend 3500% (i.e. 70Rs/share face value of 2Rs) 1397.81 corer Final dividend 1750% (i.e. 35Rs/share face value of 2Rs) 698.91 corer 192.79 corer has been transferred to general reserve


Hero Investment Private Limited (HIPL)
Bahadur Chand Investment Private Limited (BCIPL) Hero Cycles Limited (Hero)

Honda Motor Company Limited (Honda)

Hero cycle transferred its shareholding in the company to HIPL on may 28,2010

Honda transfer its 26% shareholding to the Indian Promoter Group

Indian Promoter Group and Honda also entered into license agreement on 1-1-2011
Honda has given rights and license to manufacture,

assemble, sell and distribute certain products and service part under Intellectual Property Right Rs 1,928.37 corers for manufacture, assemble, selling and distribution 550.96 corers for exports

Change of Name
Hero Honda Motors Limited is now Hero Motocorp

Limited Subsequently fresh certificate of incorporation consequent to change of name dated july 28,2011 The new corporate identity (new Corporate Logo) was adopted by the Board of Directors on August 17, 2011 for future

They have audited the attached Balance Sheet, the Profit and

Loss Account and the Cash Flow Statement of the Company for the year ended on at March 31, 2011. These financial statements are the responsibility of the Companys management. Conducted our audit in accordance with the auditing standards generally accepted in India. Includes on a test basis, evidence supporting the amounts and the disclosures in the financial statements. The Company has maintained proper records showing full particulars, including quantitative details and situation of the fixed assets.


As per the auditors, the physical verification of certain fixed

assets over a period of three years is adequate and reasonable. Inventories have been physically verified by the management except some which lying with third parties for which confirmations have been obtained in most of the cases. The Company is not dealing or trading in shares, securities, debentures and other investments. The Company has been regular in depositing undisputed statutory dues including provident fund, income tax, sales tax, wealth tax, customs duty etc.

Corporate Governance is
a relationship among stakeholders that is used to

determine and control the strategic direction and performance of organizations concerned with identifying ways to ensure that strategic decisions are made effectively. used in corporations to establish order between the firms owners and its top-level managers


Its belief that the essence of Corporate Governance

lies in the phrase Your company. It is your company because it belongs to you- the shareholders. The chairman and directors objectives is to take the business forward in such a way that it maximises Your long-term value. Your Company is committed to benchmarking itself with global standards for providing good Corporate Governance.


Full Disclosure Independent monitoring and fairness to all

Especially to minority shareholders


The Hero MotoCorp factory at Dharuhera develop these rural areas by many ways like :Installation of deep bore hand pumps to provide clean drinking water. Constructing metallic roads and connecting these villages to the National Highway (NH -8). Renovating primary school buildings and providing hygienic water and toilet facilities. Promoting non-conventional sources of energy by providing a 50 per cent subsidy on biogas plants.

Contd Education : Raman Munjal Vidya Mandir,a modern senior secondary

school,CBSE affiliated with over 1200 students and 61 teachers.

Adult Literacy Mission, launched on 21st September, 1999, for

ill literate adults and to motivate villagers to literate them. Started with 36 adults but now there are 100 adults with this scheme.

Contd Health : Raman Munjal Memorial Hospital, multi-specialty hospital

equipped with the latest diagnostic and surgical technology.

Besides setting up a modern hospital, the Foundation also

regularly provides doorstep health care services to the local community.

Apart from these Hero Motocorp also started Vocational

Training Centre especially for women trained in tailoring.

Management Discussion & Analysis

Economic Scenario
Industry and Segment Insight New Product Launches

Accelerated Performance
Financial Scorecard Network Expansion Research and Development Risk Management Green Management

Ratio Analysis

Type of Ratio


(2010- (2009 11) -10)


Current Ratio =

Current Assets Current Liability



Increase in current ratio shows High liquidity The Ideal ratio should be 2:1

Quick Ratio =

Current Assets-Inv-Pre. Exp Current Liability-Bank O/D



The quick ratio measures a company's ability to meet its short-term obligations with its most liquid assets. The ideal ratio should be 1.33:1

Type of Ratio



(2009 -10)

Comment A ratio showing how many times a company's inventory is sold and replaced over a period. High ratio is suitable for company

Inventory Turnover Ratio=

Cost of goods sold Average Inventory



Debtors Turnover Ratio=

Credit Sales Average Debtors + B/R



This ratio shows the credit which is given to customers. High ratio shows better efficiency.

Asset Turnover Ratio=

Total Sales Total Assets



This ratio shows the revenue over the assets. High ratio shows the growth of the company.

Type of Ratio



(2009 -10)


Gross Profit Ratio

Gross Profit*100 Net Sales Net Profit*100 Sales



This ratio shows the gross profit of the company. High ratio shows growth of the company. This ratio shows the net profit of the company. High ratio shows growth of the company.

Net Profit Ratio



Rate of Return on Capital Employed

EBIT Total AssetsCurrent Liabilities



This ratio indicates the efficiency and profitability of a company's capital investments. High ratio shows better standing in monetary terms.

Type Of Ratio



(2009 -10)


Earnings per Share

PAT Preference Dividend___ Outstanding equity share



EPS shows the portion of a company's profit allocated to each outstanding share of common stock. High ratio is desirable.

Notes To The Accounts

Accounting convention- Prepared according to the

Companies Act, 1956. Fixed assets and depreciation- Fixed assets are stated at cost less depreciation. Depreciation is calculated by Straight Line Method Investments and Inventories- Investments are calculated at book value of fair value whichever is lower.

Employee benefits are provided in form of Provident fund,

Superannuation fund and Employees state Insurance Corporation (ESIC) Revenue Recognition- Revenue is recorded when the transaction is completed. Taxation- Taxation is ascertained in accordance with Provisions of the Income-tax Act, 1961. Principle of Conservatism is followed.