Seminar Report on

Automobiles

Topic:-Maruti Suzuki Ltd.

Submitted to:-kanwal Gurleen Sir

In partial fulfillment of theRequirements for the award of Degree of

Bachelor of Business Adminstration

Submitted by: KashishVadhera

University Registration No. 3020070114

Section:- B

DEPARTMENT OF MANAGEMENT LOVELY PROFESSIONAL UNIVERSITY

PHAGWARA (2008)

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INDEX

S.no Contents Page no.1.2.3.4.5.6.7.8.9.10.11.12.13.14.15.16.17.18.19.20.21.22.

AcknowledgementOverview of the companyIndia and automobile industryGrowth pace of the industryAuto export in India SWOT anyalsis of exportsFactors responsible for exportsMajor playersProfile of the companyGet to know the Company betterWhy go for Maruti Suzuki?Code of conductAchievements and milestonesFacilities providedMaruti and its StakeholdersProduct range of MarutiSocial activitiesPerformance over last few yearsFinacial status Furture prosepectsCritical appraisal and suggestionsBibliography

3456101213131620222427313438394146475053

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ACKNOWLEDGEMENT

To complete a task all you require is some hard work and efforts, but with a blend of these two you also need the support and guidance of many people. So I pleasure is all mine to first of all thank Mr.Rahul, professor of seminar on corporate profile without whose able guidance, Co-operation & Supervision the present study couldn’t have ‘been possible.

I would like to thank my greatest source of support, my god for giving me the strength and confidence to complete the same. I m truly thankful to him for showering his blessings on me time to time. I would like to thank my sister, Miss. Preeti for her valuable guidance and suggestions.

I m also thankful to all my friends and my group members for their support and encouragement.

Kashish Vadhera

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OVERVIEW OF THE INDUSTRY

HISTORY OF AUTOMOBILE INDUSTRY:

With the invention of the wheel in 4000 BC, man’s journey on the road of

mechanized transport had begun. Since then he continually sought to devise an

automated, labour saving machine to replace the horse. Innumerable attempts reached

conclusion in the early 1760s with the building of the first steam driven tractor by a

French Captain, Nicolas Jacob Cugnot.

It was however left to Karl Benz and Gottlieb Damlier to produce the first vehicles

powered by the internal combustion engine in 1885. It was then that the petrol engine

was introduced, which made the car a practical and safe proposition. The cars in this

period were more like the cars on our roads today. With cars came the era of speed.

The first ever land-speed record was established about a 100 years back, in 1898.

The Automobile Industry finally came of age with Henry Ford in 1914 for the bulk

production of cars. This lead to the development of the industry and it first begun in

the assembly lines of his car factory. The several methods adopted by Ford, made the

new invention (that is, the car) popular amongst the rich as well as the masses.

Count Gaston de Chasseloup-Laubat of France drove an electric car (in Acheres near

Paris) at a speed of 39.24 miles per hour. This flagged off the era of ‘wheels racing’,

which lasted till 1964, after which jet and rocket -propelled vehicles were allowed.

Then onwards, it has been one big journey...on the roads.Automobile industry, the

business of producing and selling self-powered vehicles, including passenger cars,

trucks, farm equipment, and other commercial vehicles. By allowing consumers to

commute long distances for work, shopping, and entertainment, the auto industry has

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encouraged the development of an extensive road system, made possible the growth

of suburbs and shopping centers around major cities, and played a key role in the

growth of ancillary industries, such as the oil and travel businesses.

The auto industry has become one of the largest purchasers of many key industrial

products, such as steel. The large number of people the industry employs has made it

a key determinant of economic growth.

INDIA AND AUTOMOBILE INDUSTRY

PAST SCENARIO OF THE INDUSTRY IN INDIA:

Since the first car rolled out on the streets of Mumbai (then Bombay) in 1898, the

Automobile Industry of India has come a long way. During its early stages the auto

industry was overlooked by the then Government and the policies were also not

favorable. The liberalization policy and various tax reliefs by the Govt. of India in

recent years has made remarkable impacts on Indian Automobile Industry. Indian auto

industry, which is currently growing at the pace of around 18 % per annum, has

become a hot destination for global auto players like Volvo, General Motors and

Ford.

PRESENT SCENARIO OF THE INDUSTRY IN INDIA:

A well developed transportation system plays a key role in the development of an

economy, and India is no exception to it. With the growth of transportation system the

Automotive Industry of India is also growing at rapid speed, occupying an important

place on the 'canvas' of Indian economy.

Today Indian automotive industry is fully capable of producing various kinds of

vehicles and can be divided into 03 broad categories : Cars, two-wheelers and heavy

vehicles.

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SOME UNKOWN FACTS ABOUT THE INDUSTRY IN INDIA:

The first automobile in India rolled in 1897 in Bombay.

India is being recognized as potential emerging auto market.

Foreign players are adding to their investments in Indian auto industry.

Within two-wheelers, motorcycles contribute 80% of the segment size.

Unlike the USA, the Indian passenger vehicle market is dominated by cars

(79%).

Tata Motors dominates over 60% of the Indian commercial vehicle market.

2/3rd of auto component production is consumed directly by OEMs.

India is the largest three-wheeler market in the world.

India is the largest two-wheeler manufacturer in the world.

India is the second largest tractor manufacturer in the world.

India is the fifth largest commercial vehicle manufacturer in the world.

The number one global motorcycle manufacturer is in India.

India is the fourth largest car market in Asia - recently crossed the 1 million

mark.

GROWTH PACE OF THE INDUSTRY:

Following India's growing openness, the arrival of new and existing models, easy

availability of finance at relatively low rate of interest and price discounts offered by

the dealers and manufacturers all have stirred the demand for vehicles and a strong

growth of the Indian automobile industry.

The data obtained from ministry of commerce and industry, shows high growth

obtained since 2001- 02 in automobile production continuing in the first three quarters

of the 2004-05. Annual growth was 16.0 per cent in April-December, 2004; the

growth rate in 2003-04 was 15.1 per cent The automobile industry grew at a

compound annual growth rate (CAGR) of 22 per cent between 1992 and 1997. With

investment exceeding Rs. 50,000 crore, the turnover of the automobile industry

exceeded Rs. 59,518 crore in 2002-03. Including turnover of the auto-component

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sector, the automotive industry's turnover, which was above Rs. 84,000 crore in 2002-

03, is estimated to have exceeded Rs.1,00,000 crore ( USD 22. 74 billion) in 2003-04.

“The passenger car and motorcycle segment in Indian auto Industry is growing by

8-9 per cent”.

GROWTH IN INDIA:

The Indian automobile industry crossed a landmark with total vehicle

production of 10 million units.

Car sales was 8,82,094 units against 8,20,179 units in 2004-05.

The two-wheeler market grew by 13.6 per cent with 70,56,317 units against

62,09,765 units in 2004-05.

Commercial vehicles segment grew at 10.1 per cent with 3,50,683 units

against 3,18,430 units in 2004-05.

India, sourcing base for global auto majors.

Passenger car and motorcycle segment is set to grow by 8-9%.

The two-wheeler segment will clock 11.5% rise by 2007.

Commercial vehicle to grow by 5.2 per cent.

Estimated component market size is US$ 6.7 bn.

India, in auto sector, is turning to be a sourcing base for the global auto majors. The

passenger car and the motorcycle segment is set to grow by 8-9 per cent in coming

couple of years, says the ICRA report. The industry is likely to maintain the growth

momentum picked up in 2002-03.

The ICRA's analysis points on the auto sector that the passenger car market in the

country was inching towards cars with higher displacements. The sports-utility-

vehicle (SUV) that was getting crowded everyday, would witness intense competition

as many SUVs had been competitively priced, the report said.

Honda, Suzuki, General Motors and Hyundai, the global automakers had already

launched their premium SUVs in the market to broaden their portfolio and create

product excitement in the segment estimated at about 10,000 units annually.

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In the two-wheeler segment, according to the report, the motorcycles would clock

11.5 per cent rise during 2004-2007 over its siblings-scooters and mopeds. Scooters

sales would decelerate and mopeds would also see the same. Overseas market would

present huge opportunities for the two-wheeler makers.

The commercial vehicles are likely to grow at a CAGR of 5.2 per cent. Heavy

commercial vehicles market would rise at 5.5 per cent and sales of light buses and

trucks would achieve 4.7 per cent growth. For the tractors, the report predicts a

growth at 4.6 per cent.

Indian Auto Market Growth for the year 2005-06:

The domestic automobile industry sales grew 12.8 per cent at 89,10,224 units

as against 78,97,629 units in 2004-05.

The automotive industry crossed a landmark with total vehicle production of

10 million units.

According to the Society of Indian Automobile Manufacturers (SIAM), car

sales was 8,82,094 units against 8,20,179 units in 2004-05.

The growth of domestic passenger car market was 7.5 per cent

Car exports stood at 1,70,193 units against 1,60,670 units in 2004-05.

The two-wheeler segment, the market grew by 13.6 per cent with 70,56,317

units against 62,09,765 units in 2004-05.

Motorcycles had the upward march, 17.1 per cent in domestic market touching

58,15,417 units against 49,64,753 units in 2004-05.

Scooter segment grew by 1.5 per cent, fall at 9,08,159 units against 9,22,428

units in 2004-05.

Commercial vehicles segment grew at 10.1 per cent with 3,50,683 units

against 3,18,430 units in 2004-05.

Medium and heavy commercial vehicles managed a growth of 4.5 per cent

against 23 per cent growth in the year ended March 31, 2005.

Light commercial vehicles sales growth was 19.4 per cent at 1,43,237 units

against 1,19,924 units in 2004-05.

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Three-wheelers sales rose by 17 per cent at 3,60,187 units against 3,07,862

units in 2004-05.

AUTO EXPORT IN INDIA

In auto export, passenger vehicle exports have grown over five times from the start of

the decade and two-wheeler exports have reached more than double

EXPORTS AND INDIAN DEALINGS: Foreign auto makers, including Ford Motor Co. , General Motors Corp.,

Honda Motor Co. Ltd., Toyota Motor Corp., DaimlerChrysler AG and Hyundai Motor Co. Ltd., are looking to increase their presence in India and use it as an export hub.

Exports of auto components, whose manufacturing costs are 30-40 per cent lower than in the West, have grown at 25% a year between 2000 to 2005.

In 2003-04 the export of the industry was 55.98%. Two-wheelers are mostly exported from India. The reason behind the export is cost competitiveness in terms of labor and raw

material. The export of auto components has grown to 19% from the start of the decade.

SOME FACTS AND FIGURES:The Indian automotive export industry presently is finding a good recognition globally. The auto industry along with the component

industry is contributing to the export effort of the country. In 2002-03, the export of the automobile industry had registered a growth

rate of 65.35%. In 2003-04, it was 55.98%. The following table briefs about the 2003-04 and 2004-05 (upto April-Dec. 2004)

automobile export in numbers.

Category 1998-99 2004-05 (Apr-Dec)

Passenger Car 25468 121478

Multi Utility Vehicles 2654 3892

Commercial Vehicles 10108 19931

Two Wheelers 100002 256765

Three Wheelers 21138 51535

Percentage Growth -16.6 32.8

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AUTO COMPONENTS :

Any automobile is the assembly of several auto parts with each part contributing to its

machinery and polishing its quality. Lack or failure of just one part can breakdown

the entire system so every component plays its part. We have provided the detailed

list of all the components of any vehicle. This list would enable the user to gain

complete knowledge about various auto parts. It would allow the user to access the

importance and uses of various integral parts of automobile.

EXAMPLES OF AUTO COMPONENTS:

Chassis and Frame

Springs

Fuel Supply System

Electrical System

Braking System

Lubrication System

Gauges

Gaskets and Seals

Lighting System

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Exhaust System

Suspension and Steering

Transmission System

Wheels and Tyres

Fasteners

Valves

Cooling System

Engine

Export of Auto Components:

Investments in the auto ancillary sector are rising rapidly. In 1997, the size of the auto

component industry was US$ 2.4 billion and now in 2004-05 it has become US$ 8.7

billion industry. The export of auto components has grown at a compounded growth

rate of 19 per cent over the past six years.

Jai Parabolic Springs (JPSL) is a leading manufacturer of parabolic springs in India

and has bagged two major orders from international auto majors, General Motors

(GE) and Ford.

Robert Bosch, auto parts maker of Germany has relocated manufacture of certain

products to MICO, India. Crosslink International Wheels, Malaysia's leading

automobile security provider Wheels Electronic SDN, is setting up its manufacturing

unit at Baddi to make India the export hub for the SAARC region.

PSA Peugeot Citroën, French automobile group has placed orders for components

worth US$ 10 million with Indian companies.

Fiat India exported components worth US$ 8.3 million in 2004-05 to its operations in

South Africa. GKN Driveline and Dubai based auto ancillary major Parts

International plans for an investments in India.

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Bar graph showing exports of auto components .

SWOT ANYALSIS OF INDIAN EXPORTS:

STRENGTHS:

Cost competitiveness in terms of labor and raw material.

Established manufacturing base. Economics of scale due to domestic market.

Potential to harness global brand image of the parent company.

Global hub policy for small car like Hyundai, Suzuki, etc.

WEAKNESS:

Perception about quality.

Infrastructure bottlenecks.

OPPORTUNITIES:

Huge export markets such as Europe, America, Africa, and others for Indian

cars.

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THREATS:

China, Malaysia, Thailand, etc.

Many other countries also have strategies for export promotion.

FACTORS RESPONSIBLE FOR EXPORTS:

Internal Factors:

Attaining high quality for global standards.

Continuous cost reduction for global competitiveness.

Supply chain management (logistics).

Attaining economies of scale & scope.

External Factors:

Improve infrastructure (ports, roads, etc).

Improve EXIM regulations.

MAJOR PLAYERS IN INDUSTRY

All those people who are crazy about speed, automobile are indeed a prized

possession for them. With the increased number of car and two wheeler loans and

finance schemes available in today's market, it is not that difficult to purchase the

same. However, if you have already decided to purchase a vehicle, then before the act

of purchase, do get to know something about the key players who dominate this

market.

In terms of Car dealer networks and authorized service stations, Maruti leads the pack

with Dealer networks and workshops across the country. The other leading

automobile manufactures are also trying to cope up and are opening their service

stations and dealer workshops in all the metros and major cities of the country.

Dealers offer varying kind of discount of finances who in tern pass it on to the

customers in the form of reduced interest rates.

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Ashok Leyland HMT Tractors Royal Enfield

Audi AG Honda Motors Co. Ltd. San Motors

Bajaj Auto Hyundai Motors Scooters India Ltd

BEML Indofarm Tractors Skoda Auto India

BMW Kinetic Motor Co. Ltd. Sonalika Tractors

Bentley Motors Limited Lamborghini Suzuki Motors

Chevrolet LML India Swaraj Mazda Ltd.

Daewoo Motors Mahindra & Mahindra Ltd. Tafe Tractors

Eicher Motors Maruti Suzuki India Ltd. Tata Motors

Escorts Ltd. Mercedes Benz Telcon

Fiat India Pvt Ltd Mitsubishi Motors Terex Vectra

Force Motor Monto Motors Toyota Kirloskar Motors

Ford Motors Nissan Motors TVS Motor Co.

General Motors Porsche Volvo

Hero Honda Reva Electric Co. Yamaha Motor

Hindustan Motors Rolls-Royce Motor  

These are the companies that bring to us our dream machines. This is where it all

starts from; the bourgeoisie Maruti 800, the upmarket Astra, the stately Mercedes, the

'Indian' Indica, the racy Hero Honda, the Tata truck and the rest.

Wend your way through the automobile companies, their history and product lines.

Find out hitherto unknown facts about the vehicles you use. Did you know that the

Hindustan Motors was the first vehicle manufacturing company to be set up in India?

And it is the same Hindustan Motors which manufactures both the sturdy Ambassador

and the elegant Lancer, in association with Mitsubishi of course.

In the two- wheeler segment, the biggest player in India is hero honda. A joint venture

between the famous Hero group of India and Hondagroup of Japan, it has the record

of producing 1.3 million motorbikes in a single business year in its kitty. All its produ

Most popular two- wheelers produced by this company include the likes of Glamour,

Karizma, splendor, CD Dawn, Passion and Passion plus.

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Next we have Bajaj Auto, which is known to be worlds third largest two as well as

three wheeler manufacturing company. It offers enormously popular bikes like

CT100, Platina, Discover, Pulsar, Pulsar DTS I and Avenger DTS I. All its products

are popular for their mileage offerings and attractive looks.

In the four wheeler segment, the most reputed Indian global brand is Maruti Udyog, a

joint venture between SuzukiMotors, Japan and the Government of India. It is a listed

company and is credited for producing and subsequent selling of more than one

million cars in a financial year. It is the largest producer of four wheeler automobiles

in the entire south Asia. Its popular products include Maruti 800, Maruti 1000, Omni,

Esteem, Alto, Wagon -R and Zen. cts are known to be user friendly and fuel efficient.

MARKET SHARES OF THE INDUSTRY IN INDIA:

Among the two-wheeler segment, motorcycles have major share in the market. Hero

Honda contributes 50% motorcycles to the market. In it Honda holds 46% share in

scooter and TVS makes 82% of the mopeds in the country.

40% of the three-wheelers are used as goods transport purpose. Piaggio holds 40% of

the market share. Among the passenger transport, Bajaj is the leader by making 68%

of the three-wheelers.

Cars dominate the passenger vehicle market by 79%. Maruti Suzuki has 52% share in

passenger cars and is a complete monopoly in multi purpose vehicles. In utility

vehicles Mahindra holds 42% share.

In commercial vehicle, Tata Motors dominates the market with more than 60% share.

Tata Motors is also the world's fifth largest medium & heavy commercial vehicle

manufacturer.

PROFILE OF THE ORGANIZATION

Maruti Suzuki India Limited is a publicly listed automaker in India. It is a leading four-wheeler automobile manufacturer in South Asia. Suzuki Motor Corporation of

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Japan holds a majority stake in the company. It was the first company in India to mass-produce and sell more than a million cars. It is largely credited for having brought in an automobile revolution to India. It is the market leader in India. On 17 September 2007, Maruti Udyog was renamed to Maruti Suzuki India Limited. The company's headquarters remain in Gurgaon, near Delhi.

Maruti Suzuki is one of India's leading automobile manufacturers and the market leader in the car segment, both in terms of volume of vehicles sold and revenue earned. Maruti Udyog Limited (MUL) was established in February 1981, though the actual production commenced in 1983. Through 2004, Maruti has produced over 5 Million vehicles. Marutis are sold in India and various several other countries, depending upon export orders. Cars similar to Marutis (but not manufactured by Maruti Udyog) are sold by Suzuki in Pakistan and other South Asian countries.Until recently, 18.28% of the company was owned by the Indian government, and 54.2% by Suzuki of Japan. The Indian government held an initial public offering of 25% of the company in June 2003. As of May 10, 2007, Govt. of India sold its complete share to Indian financial institutions. With this, Govt. of India no longer has stake in Maruti Udyog.

The company annually exports more than 30,000 cars and has an extremely large domestic market in India selling over 500,000 cars annually. Maruti 800, till 2004, was the India's largest selling compact car ever since it was launched in 1983. More than a million units of this car have been sold worldwide so far. Currently, Maruti Alto tops the sales charts.

Due to the large number of Maruti 800s sold in the Indian market, the term "Maruti" is commonly used to refer to this compact car model. Till recently the term "Maruti", in popular Indian culture, was associated to the Maruti 800 model.

Maruti Suzuki India Limited, a subsidiary of Suzuki Motor Corporation of Japan, has been the leader of the Indian car market for over two decades.

A BIT ABOUT ITS PARENT COMPANY ITS OWNER:

Suzuki Motor Corporation is a Japanese multinational corporation that specializes in

manufacturing compact automobiles, a full range of motorcycles, All-Terrain

Vehicles (ATVs), outboard marine engines, wheelchairs and a variety of other small

internal combustion engines. Suzuki is the 12th largest automobile manufacturer in

the world, employs over 45,000 people, has 35 main production facilities in 23

countries and 133 distributors in 192 countries.

"Suzuki" is pronounced in Japanese as "soo-zoo-kee" suzuki, with emphasis on a high

"kee". It is almost always wrongly pronounced as "suh-ZOO-kee" with a stressed

"zoo". This pronunciation is used by the English-speaking public and by the Suzuki

company in marketing campaigns directed towards this demographic

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In 1909, Michio Suzuki founded the Suzuki Loom Company in the small seacoast

village of Hamamatsu, Japan. Business boomed as Suzuki built weaving looms for

Japan's giant silk industry. Suzuki's only desire was to build better, more user-friendly

looms. In 1929, Michio Suzuki invented a new type of weaving machine, which was

exported overseas. Suzuki filed as many as 120 patents and utility model rights. The

company's first 30 years focused on the development and production of these

exceptionally complex machines.

Despite the success of his looms, Suzuki realized his company had to diversify and he

began to look at other products. Based on consumer demand, he decided that building

a small car would be the most practical new venture. The project began in 1937, and

within two years Suzuki had completed several compact prototype cars. These first

Suzuki motor vehicles were powered by a then-innovative, liquid-cooled, four-stroke,

four-cylinder engine. It featured a cast aluminum crankcase and gearbox and

generated 13 horsepower (9.7 kW) from a displacement of less than 800cc.

With the onset of World War II, production plans for Suzuki's new vehicles were

halted when the government declared civilian passenger cars a "non-essential

commodity."

After the war, the Japanese had a great need for affordable, reliable personal

transportation. A number of firms began offering "clip-on" gas-powered engines that

could be attached to the typical bicycle. Suzuki's first two-wheel ingenuity came in

the form of a motorized bicycle called, the "Power Free." Designed to be inexpensive

and simple to build and maintain, the 1952 Power Free featured a 36 cc two-stroke

engine. An unprecedented feature was the double-sprocket gear system, enabling the

rider to either pedal with the engine assisting, pedal without engine assist, or simply

disconnect the pedals and run on engine power alone.

The system was so ingenious that the patent office of the new democratic government

granted Suzuki a financial subsidy to continue research in motorcycle engineering,

and so was born Suzuki Motor Corporation.

In 1953, Suzuki scored the first of many racing victories when the tiny 60 cc

"Diamond Free" won its class in the Mount Fuji Hill Climb.

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By 1954, Suzuki was producing 6,000 motorcycles per month and had officially

changed its name to Suzuki Motor Co., Ltd. Following the success of its first

motorcycles, Suzuki created an even more successful automobile: the 1955 Suzulight.

Suzuki showcased its penchant for innovation from the beginning. The Suzulight

included front-wheel drive, four-wheel independent suspension and rack-and-pinion

steering -- features common on cars half a century later.

HISTORY OF MARUTI SUZUKI :

Maruti Suzuki India Limited (MSIL) was established in Feb 1981 through an Act

of Parliament, as a Government company with Suzuki Motor Corporation of

Japan holding 26 per cent stake. It was entrusted the task of achieving the

following:

Modernization of the Indian Automobile Industry.

Production of vehicles in large volumes

Production of fuel efficient vehicles.

Suzuki was an obvious choice because of its unparalled expertise in small

cars.The Joint Venture agreement was signed between Government of India and

Suzuki Motor Company (now Suzuki Motor Corporation of Japan) in Oct 1982.

The company went into production in a record time of 13 months and the first

car was rolled out from Maruti Suzuki India Limited Gurgaon in December,

1983 and heralded a revolution in the Indian car industry.

Maruti collaborated with Suzuki of Japan to produce the first affordable car for

the average Indian. At this time, the Indian car market had stagnated at a volume

of 30,000 to 40,000 cars for the decade ending 1983. This was from where

Maruti took over.

The sales figure for the year 1993 reached up to 1,96,820. The company reached

a total production of one million vehicles in March 1994 becoming the first

Indian Company to cross this milestone. It crossed the two million mark in 1997.

India's largest automobile company, it entered the Indian car market with the

avowed aim to provide high quality, fuel - efficient, low - cost vehicles. Its cars

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operate on Japanese technology, adapted to Indian conditions and Indian car

users. Maruti comes in a variety of models in various segments.

In the small car segment it produces the Maruti 800 and the Zen.The big car

segment includes the Maruti Esteem and the Maruti 1000.

Maruti Suzuki was born as a Government of India company, with Suzuki as a minor

partner, to make a people’s car for middle class India. Over the years, the product

range has widened, ownership has changed hands and the customer has evolved.

The old logo of Maruti Suzuki India Limited.

Later the logo of Suzuki Motor Corp. was also added to it.

GET TO KNOW COMPANY BETTER.

Maruti Suzuki India Ltd

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Type Public (BSE MARUTI, NSE MARUTI)Founded 1981

Headquarters Gurgaon, Haryana, India

Key peopleShinzo Nakanishi, CEOJagdish Khattar, Managing Director

Industry AutomotiveProducts CarsRevenue ▲US$2.5 billion (2005)

Employees 6,903Parent Suzuki

Website www.marutisuzuki.com

BACKGROUND OF THE COMPANY:

Managing Director And CEO

Shinzo Nakanishi

Director (Production)

Tsuneo Ohashi

Director (Marketing & Sales)

Shuji Oishi

Incorporation Year 1981

Registered Office 11th floor Jeevan Prakash, 25 Kasturba Gandhi Marg, New Delhi - 110001, New Delhi

Telephone 91-11-23316831/23712854

Fax 91-11-23318754/23713575

Industry Automobiles - Passenger Cars

House MNC Associate

Face Value 5

Market Lot 1

Listing Mumbai, NSE

Registrar

Karvy Computershare Pvt LtdKarvy House 46, Road No 4 Street No1, Banjara Hills, Hyderabad - 500034

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Director

O Suzuki

Chairman (Non-Executive)

R C Bhargava Directors Amal Ganguli

  D S Brar

  Manvinder Singh Banga

  Pallavi Shroff

Company Secretary Anil Rustgi

Whole-time Director Keilchi Asai

Additional Director Kenichi Ayukawa

Director D S Brar

  Tsuneo Kobayashi

BOARD OF DIRECTORS:

WHY GO FOR MARUTI SUZUKI?

The Quality Advantage

Maruti Suzuki owners experience fewer problems with their vehicles than any

other car manufacturer in India (J.D. Power IQS Study 2004). The Alto was

chosen No.1 in the premium compact car segment and the Esteem in the entry

level mid - size car segment across 9 parameters.

The J.D. Power APEAL Study 2004 proclaimed the Wagon R no. 1 in the

premium compact car segment and the Esteem No.1 in the entry level mid - size

car segment. This study measures owner in terms of design, content, layout and

performance of vehicles across 8 parameters.

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A Buying Experience Like No Other

Maruti Suzuki has a sales network of 307 state-of -the-art showrooms across 189

cities, with a workforce of over 6000 trained sales personnel to guide our

customers in finding the right car. Our high sales and customer care standards led

us to achieve the No.1 nameplate in the J.D. Power SSI Study 2004.

Quality Service Across 1036 Cities

In the J.D. Power CSI Study 2004, Maruti Suzuki scored the highest across all 7

parameters: least problems experienced with vehicle serviced, highest service

quality, best in-service experience, best service delivery, best service advisor

experience, most user-friendly service and best service initiation experience.

92% of Maruti Suzuki owners feel that work gets done right the first time during

service. The J.D. Power CSI study 2004 also reveals that 97% of Maruti Suzuki

owners would probably recommend the same make of vehicle, while 90%

owners would probably repurchase the same make of vehicle.

One Stop Shop

At Maruti Suzuki, you will find all your car related needs met under one roof.

Whether it is easy finance, insurance, fleet management services, exchange-

Maruti Suzuki is set to provide a single-window solution for all your car related

needs.

The Low Cost Maintenance Advantage

The acquisition cost is unfortunately not the only cost you face when buying a

car. Although a car may be affordable to buy, it may not necessarily be

affordable to maintain, as some of its regularly used spare parts may be priced

quite steeply. Not so in the case of a Maruit Suzuki. It is in the economy segment

that the affordability of spares is most competitive, and it is here where Maruti

Suzuki shines.

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Lowest Cost of Ownership

The highest satisfaction ratings with regard to cost of ownership among all

models are all Maruti Suzuki vehicles: Zen, Wagon R, Esteem, Maruti 800, Alto

and Omni.

We are proud to have the lowest cost of operation/km (among petrol vehicles) -

the top 5 models are all Maruti Suzuki models : Maruti 800, Alto, Zen, Omni and

Wagon R.

QUALITY FOR SURE :

At Maruti, our approach to quality is in keeping with the Japanese

practice--"build it into the product". Technicians themselves inspect the quality

of work. Supervisors educate and instruct technicians to continually improve

productivity and quality. The movement of quality indicators is reviewed in

weekly meetings by the top management.

In 2001, Maruti Suzuki India Ltd became one of the first automobile companies

anywhere in the world to get an ISO 9001:2000 certification. AV Belgium,

global auditors for International Organization for Standardisation(ISO), certified

Maruti after a four day long audit, covering varied parameters like Customer

Focussed organisation, Leadership, Involvement of people, Process approach,

System approach to Management, Continual improvement, etc.

24

ISO 9001:2000 CERTIFICATION

CODE OF CONDUCT

WHAT EXACTLY IS CODE OF CODUCT FOR MARUTI:

As a responsible corporate citizen, Maruti Suzuki India Limited (‘Maruti’ or “the

Company”) has always believed in following highest standards of Corporate

Governance. Being a listed Company, every act of the Company, its Board Members

and its employees is the focus of public attention and accordingly, there is a need to

reinforce Maruti’s commitment towards maintaining highest standards of Corporate

Governance.

This Code of Business Conduct and Ethics (“Code of Conduct” or “Code”) helps

ensure compliance with our standards of business conduct & ethics and also with

regulatory requirements. All Senior Management Personnel are expected to read and

understand this Code of Business Conduct and Ethics, uphold these standards in day-

to-day activities and also comply with all applicable standards, policies and

procedures of the company.

This policy should be read in conjunction with applicable regulations & existing

policies & procedures of the Company.

APPLICABILITY:

25

This Code of Conduct is applicable to all Senior Management Personnel which would

include the

directors of the Company, the top management personnel (i.e., executive directors &

advisors at executive director level) & all functional heads (including management

personnel with direct functional reporting to directors & top management personnel).

All Senior Management Personnel are expected to comply with the letter and spirit of

this Code. The Senior Management Personnel should continue to comply with other

applicable laws & regulations and the relevant policies, rules and procedures of the

Company.

INTERPRETATION OF THE CODE:In this Code the term “Relative” shall have the same meaning as defined in Section 6

of the Companies Act, 1956. In this Code, words importing the masculine shall

include feminine and words importing singular shall include the plural or vice versa.

Any question or interpretation under this Code of Business Conduct and Ethics will

be considered and dealt with by the Board or any person authorized by the Board on

their behalf.

HONESTY, INTEGRITY & ETHICAL CONDUCT:Senior Management Personnel shall act in accordance with the

highest standards of integrity, honesty, fairness and ethical conduct

while working for the Company as well when representing the

Company. Honest conduct means conduct that is free from fraud or

deception. Integrity & ethical conduct includes ethical handling of

actual or apparent conflicts of interest between personal and

professional relationships.

Senior Management Personnel should promote ethical behavior and

take steps to ensure that the Company promotes ethical behavior

and also encourages employees to freely report violations of laws,

rules, regulations or the Company's Code of Conduct to the appropriate personnel.

BUSINESS OPPORTUNITIES:Senior Management Personnel should not exploit for their own

benefit, opportunities that are discovered through the use of

26

Corporate property, information or position unless the opportunity is

disclosed fully in writing to the Company’s Board of Directors and

the Board of Directors authorizes the said Senior Management

Personnel to pursue such opportunity. Further, the Senior

Management Personnel must refrain from using the Company's

property or information for personal gain.

EQUAL OPPORTUNITY & ANTI HARASSMENT:Maruti is committed to a policy of equal employment opportunity so

as to assure that there shall be no discrimination or harassment

against an employee or applicant on the grounds of race, color,

religion, sex,age, marital status, disability, national origin, or any

other factor made unlawful by applicable laws and regulations. This

policy relates to all phases of employment including recruitment,

hiring, placement, promotion, transfer, compensation, benefits,

training, educational, social and recreational programs and the use

of Company facilities. Sexual harassment or exploitation is

specifically prohibited.

DISCIPLINARY ACTIONS:The matters covered in this Code of Business Conduct and Ethics

are of the utmost importance to the Company, its stockholders and

its business partners, and are essential to the Company's ability to

conduct its business in accordance with its stated values. They

expect all of their Senior ManagementPersonnel to adhere to these

rules in carrying out their duties for the Company.

The Company will take appropriate action against any Senior

Management Personnel whose actions arefound to violate these

policies or any other policy of the Company. Disciplinary actions

may include immediate termination of directorship, employment or

business relationship at the Company's sole.

27

ACHIEVEMENTS AND MILESTONES

MARUTI AND MOTOR SPORTS:

Be it a motorsport enthusiast, an amateur or a professional, Maruti Suzuki offers

the thrill and joy of motorsport to all of them.

The Maruti Suzuki motorsport calendar is packed with exciting motoring events.

For families, there are events like Women's Fun Drive and Treasure Hunt

throughout the year, across cities. The Maruti Suzuki Autocross brings action for

amateurs and professionals, together.

But what makes the Maruti Suzuki motorsport calendar an attraction in India

(and internationally too) are Maruti-Suzuki Raid-de-Himalaya, Maruti Suzuki

Rally Desert Storm and Maruti Suzuki Monsoon Car Rally of Kerala.

Maruti Suzuki Raid-de-Himalaya

Maruti Suzuki Raid-de-Himalaya is India's longest and most demanding

motorsport rally.It is open to both, car and bike enthusiasts. Maruti Suzuki

provides opportunity to professional as well as amateur motorsport lovers to

participate in the Maruti Suzuki Raid Raid-de-Himalaya.

Every year, more and more people are coming for the Maruti Suzuki Raid-de-

Himalaya, many of them from abroad. In 2007, as many as 145 teams

participated in car and bike categories.

MILESTONES:

  2005

 The fiftieth lakh car rolls out in April, 2005

  

Growth in overall sales by 15.8%

28

  2004

 New (non A/C) variant of Alto

 Alto becomes India's new best selling car

 LPG variant of 'Omni Cargo'

 Versa 5-seater, a new variant

 Baleno LXi, a new variant

 

Maruti closed the financial year 2003-04 with an annual sale of 472122 units, the highest ever since the company began operations 20 years ago

  2003

 New Suzuki Grand Vitara XL-7

 Redesigned and all-new Zen

 New upgraded WagonR Enters into partnership with State Bank of India Production of 4 millionth vehicle. Listed on BSE and NSE after a public issue oversubscribed 10 times

  2002

  WagonR Pride

 Esteem Diesel. All other variants upgraded

 

Maruti Insurance. Two new subsidiaries started: Maruti Insurance Distributor Services and Maruti Insurance Brokers Limited

 Alto Spin LXi, with electronic power steering

 Special edition of Maruti 800, India’s first colour-coordinated car

 Maruti True value in Mumbai

 Maruti Finance in Mumbai with 10 finance companies

 

Suzuki Motor Corporation (SMC) increases its stake in Maruti to 54.2 percent

  2001

  Zen LXi

 Maruti True Value launched in Bangalore and Delhi

 Maruti Versa, India’s first luxury MPV

 Alto Spin LXi, with electronic power steering

  Alto Vxi

 

Customer information centers launched in Hyderabad, Bangalore and Chennai

  Launch of versa

29

  2000

 First car company in India to launch a Call Center

  New Alto

 Altura, a luxury estate car

 

IDTR (Institute of Driving Training and Research) launched jointly with the Delhi government to promote safe driving habits

PRODUCTION MILESTONES:

1st vehicle produced, December 1983

1,00,000 vehicles produced by August, 1986

5,00,000 vehicles produced by June, 1990

10,00,000 vehicles produced by March, 1994

15,00,000 vehicles produced by April, 1996

20,00,000 vehicles produced by October, 199725,00,000 vehicles produced by March, 1999

30,00,000 vehicles produced by June, 2000

35,00,000 vehicles produced by December 2001

40,00,000 vehicles produced by April, 2003

45,00,000 vehicles produced by April, 2004

AWARDS:

  2006

  JD Power CSI: 1st Rank, 7 years in a row 2000 – 2006

  JD Power SSI: 1st Rank, 3 years in a row 2004 – 2006

  Tops TNS TCS Survey in key segments, 5 years in a row 2002 - 2006

 Among Top 5 car companies in the Forbes list of the Worlds Most Reputed Companies – Nov 06

 Features in Business Today’s annual list of “20 companies to look for in 2007” – Nov 06

  The only automobile manufacturer to feature in Business Today’s list of “India’s

30

Best 10 Marketers – Nov 06

  Ranks 1st for Corporate Social Responsibility by TNS Automotive

   2005

 Ranks 1st among Automobile companies in the Corporate Image Monitor (CIM) Study 2005 conducted by AC Nielsen ORG-MARG

 Receives a commendation from Ministry of Economy, Trade and Industry (MITI) of Japan – Sept 05

  Number one in JD Power SSI for the second consecutive year

  Number one in JD Power CSI for the sixth time in a row - the only car to win

  it so many times

  M800, WagonR and Swift topped their segments in the TNS Total

     Customer Satisfaction Study

  Leadership in the JD Power Initial Quality Study - Alto number one in its

    segment for the 2nd time in a row, Esteem number one in its segment for

    the 3rd year in a row, Swift number one in the premium compact segment

  WagonR and Esteem top their segments in the JD Power APEAL study

 Ranks 1st in Auto sector for Corporate Reputation Strength (CSR) study – Feb 05

  TNS ranks Maruti 4th in the Corporate Reputation Strength (CSR) study

    (#1 in Auto sector)-Feb 05

  Maruti bagged the "Manufacturer of the year" award from Autocar-CNBC

    ( 2nd time in a row)-Feb 05

First Indian car manufacturer to reach 5 million vehicles sales

  Business World ranks Maruti among top five most respected companies in

    India-Oct 04

  Maruti ranked among top ten (Rank7) greenest companies in India by

     Business Today - Sep '04   2004

 Maruti Suzuki was No. 1 in Customer Satisfaction, No. 1 in Sales Satisfaction No.1 in Product Quality (Esteem and Alto) and No. 1 in Product Appeal (Esteem and Wagon R)

No. 1 in Total Customer Satisfaction (Maruti 800, Zen and Alto)

   Business World ranked us among the country's five most respected companies

  Business World ranked us the country's most respected automobile company

  Voted Manufacturer of the year by CNBC

 Voted one of India's Greenest Companies by Business Today-AC Nielson ORG-MARG

       2003

 Maruti 800, Maruti Zen and Maruti Esteem make it to the top 10 automotive brands in "Most Trusted Brand survey 2003"

J D Power ranked 3 models of Maruti on top: Wagonr, Zen and Esteem

   Maruti 800 and Wagonr top in NFO Total Customer Satisfaction Study 2003.

  MUL tops in J D Power CSI (2001) for 4th time in a row        2001

 MUL tops in J D Power CSI (2001) for 2nd time in a row: another international first

     2000

 Maruti bags JD Power CSI - 1st rank; unique achievement by market leader anywhere in the world

31

Awards achieved during the time period of 2000-2007

FACILITIES PROVIDED BY THE

COMPANY

The Gurgaon facility:

Our facility in Guragoan houses three fully integrated plants. While the three plants

have a total installed capacity of 350,000 cars per year, several productivity

improvements or shop floor Kaizens over the years have enabled the company to

manufacture nearly 700,000 cars per year at the Gurgaon facilities.

The entire facility is equipped with more than 150 robots, out of which 71 have been

developed in-house. More than 50 per cent of our shop floor employees have been

trained in Japan.

The Manesar facility:

Our Manesar facility has been made to suit Suzuki Motor Corporation (SMC) and

Maruti Suzuki India Limited's (MSIL) global ambitions. The plant was inaugurated in

32

February 2007. The World Car derived from concept A-Star would be manufactured

here.At present the plant rolls our World Strategic Models Swift & SX4 and

DZire.The plant has several in-built systems and mechanisms.

There is a high degree of automation and robotic control in the press shop, weld shop

and paint shop to carry on manufacturing work with acute precision and high

quality.The plant is designed to be flexible: diverse car models can be made here

conveniently owing to automatic tool changers, centralized weld control system and

numerical control machines that ensure high quality.

The plant at Manesar is the company's fourth car assembly plant and started with an

initial capacity of 100,000 cars per year. This will be scaled up to 300,000 cars per

year by October 2008.

Diesel Engine Plant- Suzuki Powertrain India Limited:

Suzuki Powertrain India Limited the diesel engine plant at Manesar is Suzuki &

Maruti's first and perhaps the only plant designed to produce world class diesel engine

and transmissions for cars.

The plant is under a joint venture company, called Suzuki Powertrain India Limited

(SPIL) in which SMC holds 70 per cent equity the rest is held by MSIL.

This facility has an initial capacity to manufacture 100,000 diesel engines a year. This

will be scaled up to 300,000 engines/annum by 2010.

SAFETY PROVIDED:

WOMEN N DRIVING:

In the early 1990s, it was quite a discovery to see women drive a car in India. It was

completely a man's domain, and women mostly used public transport or were led by

chauffeur - driven cars.

One of the limiting factors were the kind of cars that were available in the Indian

market at that time; cars were often bulky and difficult to drive.

33

Today, the Indian woman has moved beyond her traditional roles. The transition from

a humble homemaker to a tech savvy, independent, decision maker has happened and

women in India today occupy an important place in the society.One of the factors that

has contributed significantly to the success of women in India is "Mobility", and this

mobility has come in the form of personal transport.

Maruti Suzuki brought in the first car that was easy to drive and park in the Indian

sub-continent. Today the latest cars and the technology adaptations like power

steering make driving very easy and enjoyable. However, one important aspect was to

'learn to drive'.Only in this decade, organized players like Maruti have ventured into

imparting driving skills through organized schools with world class training modules.

Maruti Suzuki has taken up to train them 'how to drive safely' through its network of

40 Maruti Driving Schools spread over 36 cities. Over 21,000 women have been

trained at these Maruti Driving Schools.

While the individual woman gains from learning driving, in many cases this skill

leads to flexibility for the whole family.

ITS COMPLETELY A GREAT EXPEREINCE:

Majority of these women are homemakers with little or limited access to affluence.

Some of them are college students, some are grandmothers, yet what is common is

their sheer passion to learn driving.

Lady instructors have been appointed to train women at these schools. These schools

are equipped with the world class, state of the art driving simulators and cars in good

condition. At MDS, the training modules are as per international standards and

include both theory and practical.

Difficult driving situations such as fog, uphill terrain, rain and night driving is

simulated on state-of-the-art simulators to give learners a first hand experience of the

weather conditions. Only after class room and simulator training the learners are taken

for actual driving on road.

34

WHAT DO THE WOMEN LEARNERS HAVE TO SAY ABOUT IT?

Anjana Khare, a homemaker, age 50, Bhopal: "Yeh bahut Zaroori Hai, kya

maloom kab kya zaroorat pad jaye".

Mrs. Kalpana Rajpoot, veterinary doctor, Madhya Pradesh : "I kept postponing

my decision to learn how to drive for almost 8 years till I got tired of my

driver's 'nakhras' and walked upto , Maruti Driving School at Gwalior.

Rachna Garg, age 20, Jammu and Yashmi: "With the basic Learner's course I

drive confidently on highways and city streets without being hassled.”

Neeraj Wason , Allahabad : "When ever I would see a lady driving a car I

would wonder when I would be independent. I am glad that now I am a source

of inspiration for many other ladies in the town.”

Institute of Driving Training and Research:

Our first major effort in promoting road safety was in the year 2000 when we took

management control of Delhi Government's Institute of Driving Training and

Research (IDTR). We introduced training facilities and infrastructure including

world-class driving test tracks, advanced computer simulators and training

modules based on the ones followed in the UK and adapted to Indian conditions.

IDTR (Institute of Driving, Training and Research) is a professional school for

driving, managed and sponsored by Maruti Suzuki. The institute is well equipped

for both practical as well as theoretical training using TV and other visual aids.

Successful participants get an IDTR certificate, which enables them to procure a

driving license from the regional transport office. The IDTR has trained and

evaluated more than 400,000 people, predominantly commercial drivers.

35

MARUTI AND IT’S STAKE HOLDERS:

CUSTOMERS:The aspiration to give more for less to the customers has given the company a

competitive edge in competitive times. The VA-VE initiatives (Value Analysis &

Value Engineering) pursued aggressively by the company in partnership with

suppliers have helped the company reduce cost of making a car without

compromising on quality.

A wide and deep service network spread across the country has helped the company

reach customers not only in metro cities but also in semi-urban, tier-2 and tier-3 cities.

In addition, the company introduced many new initiatives such as car pick & drop

facility by service workshops for women car owners, Maruti Mobile Support to offer

door step car servicing, Express service bays, special bays that can offer maintenance

service in less than 2 hours, and so on. The company has a stringent customer

complaint monitoring system.

In these competitive times the challenge is to keep inventing newer ways of doing

things to keep the customers in your fold. Over the last few years ,the company

strengthened the existing practices and experimented with many new initiatives by

way of kaizens (continuous improvements) to delight its customers.

These initiatives ranged from product design and quality to network expansion, and

included new service programs to meet unsaid needs of customers.

Servicing customers 24X7 ..... 365 days....The company takes great pride in sharing that customers have rated Maruti Suzuki first once again in Customer Satisfaction Survey conducted by independent body, J.D.Power Asia Pacific. It is 8th time in a row. The award mirrors the company's commitment towards "Customer Obsession".

Key Initiatives:Car pickup & delivery facility for women car owners

36

Service at your Door Step through Maruti Mobile Support:Another unique initiative is the door step service facility through Maruti Mobile Support.Maruti Mobile Support is a first of it's kind initiative and is expected not only to help the company reach out customers in metro cities but also as a mean to reach semi urban /rural areas where setting up of new workshop may not be viable.

SUPPLIERS:In manufacturing where a sizeable percentage of inputs are bought from vendors and

suppliers, the ability to continuously improve quality and reduce costs is directly

dependent on vendors doing the same.

In light of this statement, the company guides suppliers in adopting latest

technologies, and transfers its best practices in the areas of productivity improvement,

quality enhancement and cost reduction. The company has set up Maruti Centre for

Excellence (MACE) in collaboration with some of its suppliers to achieve these

objectives. With the help of MACE, now the company is assisting its direct suppliers

in upgrading their sub-suppliers or (Tier-2 suppliers).

DEALERS:The company has been passionately building its sales and service network since its

inception. The company has set up 16 Regional Training Centres across the country to

continuously upgrade skills of dealer employees as per new technologies and

customers'requirements.

In recent years, the company has conducted a comprehensive national survey of its

dealer employees to gauge their level of satisfaction. By many accounts, this is a rare

initiative by any principal company. Based on the results of the survey, the company

formed a cross functional team of senior management from sales, network

development and HR to identify an action plan to improve satisfaction levels of dealer

employees. One of the initiatives, for instance, was providing car loans at low rates of

interest for good performers with repayment guarantee provided by the dealer.

SHAREHOLDERS AND INVESTORS:

The company has put in place a strong mechanism for Corporate Governance to

enhance confidence of its large number of shareholders and investors in the company.

37

The company complies with all guidelines of SEBI, including new guidelines of

Clause 49. With an objective to ensure timely compliance of all applicable laws and

regulations, the company has hired an agency called 'Chess Management' to assist in

further strengthening systems of Corporate Governance including installation of new

software 'eLCM', which tracks compliance using sophisticated IT systems and

generates compliance reports.

EMPLOYEES:

The company has enforced highly conducive working environment for its employees.

MSIL does not support favouritism in recruitment, promotion, providing

compensation, or termination based on caste, religion, gender or age. The company

offers equal opportunity for growth to all employees.

During the year, the company finalised its policy on affirmative action as per the

guidelines laid down by Confederation of Indian Industries.

Maruti culture:

Open office culture, easy accessibility and innovative HR practices comprise the

Maruti culture. Our Human Resources team views an employee as an "internal

customer" and strives to deliver maximum satisfaction to him through transparent,

sensitive and innovative HR practices. Participative management, team work and

kaizen, communication and information sharing are the pillars of employee-

management relationship.

38

Following our open office culture we have a flat organizational structure with only

three levels of responsibilities via Board of Directors, Division Heads and Department

Heads. Carrying the philosophy forward, we have an open office, common uniforms

and a common canteen for all to create an environment of trust, transparency and a

sense of belonging amongst employees.

Growth opportunities:

Maruti Suzuki offers one of the best environments to learn and grow and to be

associated with some of the best processes and methods in the business of automotive

manufacturing. Apart from this, the company offers many services like Finance,

Insurance, and Driving School.

As with any progressive world class company, Maruti Suzuki 'listens' to employees

and acts on the feedback. Many innovative schemes and practices through the years

are results of having a good communication system across the organization.

PRODUCT RANGE OF MARUTI:

CARS

Maruti 800 Maruti 800 STD BS III

Maruti 800 AC BS III

Maruti 800 Duo

Omni 5 seater Maruti Omni

8 seater Maruti Omni

LPG Maruti Omni

Maruti Alto Alto

Alto Lx

Alto Lxi

Maruti Zen Estilo Wagon R Versa

39

Maruti Zen Estilo Lx

Maruti Zen Estilo Lxi

Maruti Zen Estilo Vxi

WagonR Lx

WagonR Lxi

WagonR Vxi

WagonR Ax

WagonR Duo

5 seater

8 seater ( DX & DX2)

Maruti Esteem Maruti Esteem Lx

Maruti Esteem Lxi

Maruti Esteem Vxi

Baleno Baleno Sedan VXi

Baleno Sedan LXi

Swift Swift LXi

Swift VXi

Swift ZXi

Swift Diesel'Ldi'

Swift Diesel 'Vdi'

Maruti Gypsy Hard top

Soft top

Maruti SX4 Maruti SX4 Vxi

Maruti SX4 Zxi

Maruti Zen Classic

Grand Vitara Swift DZire  

COMMERCIAL VEHICLES

>> AMBULANCE

Omni Ambulance    

AWAITED MODELS

Maruti Escudo Maruti Kazshi Maruti Suzuki Splash

40

Maruti A-Star    

SOCIAL ACTIVITIES DONE BY THE

COMPANY

Community initiatives:

The company works closely with local communities around its manufacturing

facilities to improve their quality of life. The company has adopted four villages

surrounding its Manesar plant, i.e. Kasan, Dhana, Alihar and Baas Kusla and

launched sustainable livelihood programmes for unprivileged communities. The

initiatives are focused on four key areas: Health, Education, Employment Generation

through Vocational Trainings & Basic Infrastructure Development.

Environment initiatives::

The company has remained ahead of regulatory requirements in pursuit of

environment protection and energy conservation at its manufacturing facilities, and in

development of products that use fewer natural resources and are environment

friendly.

Total energy consumption at the facilities has come down by 26 percent compared to

the beginning of the decade.

Adopting energy saving technologies:

41

While the company continuous to improve energy saving initiatives through

numerous Kaizens (continuous improvements) on the shop floor, thrust on adopting

energy saving technologies has increased phenomenally.

Three-coat-one-bake painting system: The company introduced the three-coat one-

bake system at its Manesar facilities.

In this state of the art painting system, three wet-on-wet coats are applied and baked

together. Conventional painting systems use two baking steps before the final finish.

This helps is lower energy consumption and yet improving the productivity levels.

Practicing 3R (Reduce, Reuse and Recycle):

The company has been promoting 3R since its inception. As a result the company has

not only been able to recycle 100% of treated waste water but also reduced fresh

water consumption by 28%. The company has implemented rain water harvesting to

recharge the aquifers. Also, recyclable packing for bought out components is being

actively promoted.

Greening of Supply Chain:

The company has been facilitating implementation of Environment Management

System (EMS) at its suppliers' end. Regular training programs are conducted for all

the suppliers on EMS. Surveys are conducted to assess the vendors who need more

guidance. The systems and the environmental performance of suppliers are audited.

PERFORMANCE OVER THE LAST FEW

YEARS

42

Car market leader Maruti Suzuki India Limited sold 59,908 vehicles in August

2008.The company had sold 65,968 vehicles in August 2007.During the month, the

A3 segment, grew strongly with 12.2 per cent.

The sales figures for August 2008 are given below:

Segment ModelsFor August Till August April'07 -

March'082008 2007 % Change 2008-09 2007-08 % Change

A1 M800 3717 5480 -32.2% 25319 29444 -14.0% 69553

C Omni, Versa 6540 7889 -17.1% 33554 35734 -6.1% 89729

A2 Alto, Wagon-R, Zen, Swift 37667 41736 -9.7% 197889 186886 5.9% 499280

A3 SX4, Esteem* 5427 4839 12.2% 27376 20289 34.9% 49335

Total Passenger Cars 53351 59944 -11.0% 284138 272353 4.3% 707897

MUV Grand Vitara *, Gypsy 762 285 167.4% 2979 1319 125.9% 3921

Domestic 54113 60229 -10.2% 287117 273672 4.9% 711818

Export 5795 5739 1.0% 23918 19874 20.3% 53024

Total Sales 59908 65968 -9.2% 311035 293546 6.0% 764842

SALE OF CARS FROM EARLY 80’S:

Maruti Suzuki road car timeline, Indian market, 1980s–present

Type1980s 1990s 2000s0 1 2 3 4 5 6 7 8 9 0 1 2 3 4 5 6 7 8 9 0 1 2 3 4 5 6 7 8 9

Subcompact Swift

SUVGypsy

Grand Vitara

Grand Vitara

CompactSX4

DZiRE

MicrovanOmni

Versa

City car

800Alto

Wagon-R Wagon-RZen Estilo

Suzuki Splash

Historic models

Zen Zen1000 Baleno

Esteem

THE SUCCESS OF THE JOINT VENTURE:

43

The success of the joint venture led Suzuki to increase its equity from 26% to 40% in

1987, and further to 50% in 1992. In 1982 both the venture partners had entered into

an agreement to nominate their candidate for the post of Managing Director and every

Managing Director will have a tenure of five years.

Initially R.C.Bhargava, was the managing director of the company since the inception

of the joint venture. Till today he is regarded as instrumental for the success of Maruti

Udyog. Joining in 1982 he held several key positions in the company before heading

the company as Managing Director. Currently he is on the Board of Directors. After

completing his five year tenure, Mr. Bhargava later assumed the office of Part-Time

Chairman. The Government nominated Mr. S.S.L.N. Bhaskarudu as the Manging

Director on August 27, 1997. Mr. Bhaskarudu had joined Maruti in 1983 after

spending 21 years in the Public sector undertaking Bharat Heavy Electricals Limited

as General Manager. Later in 1987 he was promoted as Chief General Manager, 1998

as Director, Productions and Projects, 1989 Director, Materials and in 1993 as Joint

Managing Director.

EXPORTS:

Maruti Exports Limited is the subsidiary of Maruti Udyog Limited with its major

focus on exports and it does not operate in the domestic Indian market. The first

commercial consignment of 480 cars were sent to Hungary. By sending a

consignment of 571 cars to the same country Maruti crossed the benchmark of

300,000 cars. Since its inception export was one of the aspects government was keen

to encourage. Every political party expected Maruti to earn foreign currency.

Angola, Benin, Djibouti, Ethiopia, Europe, Kenya, Morocco, Sri Lanka, Uganda,

Chile, Guatemala, Costa Rica and El Salvador are some of the markets served by

Maruti Exports.

The Middle-East region has also opened up and is showing good potential for growth.

Some markets in this region where Maruti has a good presence are Saudi Arabia,

Jordan, Kuwait, Bahrain, Qatar and UAE. Maruti has won several national and

international accolades. Forbes magazine ranked Maruti at 91 in the list of "World's

Most Reputed Companies". The TNS Automotive Global Corporate Social

44

Responsibility (CSR) study has rated Maruti as India 's "Most Trusted" passenger car

company.

The export portfolio, so far dominated by Alto and Maruti 800, will be bolstered with

the launch of A-Star during the latter part of 2008-09. The Company has entered into

a partnership with Mundra Port for a dedicated car terminal, including a stockyard and

parking area, in preparation for the sharp scale-up in

exports in the next few years.

The Company sold 53,024 units during 2007-08. This is the highest ever export

volume in a year for the Company, and marked a growth of 35 percent over the

previous year. The Company's contribution towards total exports by the industry

increased to 25% from 20% last year. Cumulative exports made by the Company

crossed the milestone of 500,000 vehicles.

45

The Company has decided that while focussing on volume growth,it will enhance

efforts to improve profitability from export operations.Exports will enable the

Company to be at the frontier of technology,

quality and manufacturing excel.

MARKET SHARES OF MARUTI SUZUKI:

Till date, over 6 million (60,00,000) Maruti cars have rolled out from its

manufacturing facilities. At the end of 2005-06, Maruti had a market share of

about 54 per cent of the Indian passenger car market. The company sold 5,61,822

vehicles in 2005-06 including exports of 34784 units. Maruti’s cumulative

exports are over 4 lakh units.

RECOGNITION FOR THE WORK DONE IN PREVIOUS YEARS:

The Company is India's most awarded car Company. Some of the awards won by the Company during the year under review are:

The prestigious Golden Peacock Award for excellence in the field of Environment Management in Automobile Sector.

JD Power Customer Satisfaction Award. This award has been received for the 8th time in a row.

2007 India IQS Award for Maruti Swift which has been highest ranked model in the Premium Compact car segment.

2007 India APEAL for Maruti Zen Estilo which has been highest ranked model in Compact car segment.

2007 India APEAL for Maruti Swift which has been highest ranked model in Premium Compact car segment.

2007 India APEAL for Maruti SX4 which has been highest ranked model in Midsize car segment.

"Car Manufacturer of the Year" Award by NDTV. ICICI-NDTV Profit Viewers Choice Award for Maruti SX4 in the Midsize car

segment. CNBC TV-18 Autocar Midsize Car Award for Maruti SX4. CNBC TV-18 Autocar Value for Money for Maruti SX4. CNBC TV 18 Autocar Award for Viewers Choice for Maruti SX4. CNBC TV-18 Autocar Manufacturer Award. "Manufacturer of the Year" Award in the Passenger Car category by Auto

Monitor.

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FINANCIAL STATUS OF THE

ORGANIZATION

Year Mar 08 Mar 07 Mar 06 Mar 05 Mar 04Share Capital 144.50 144.50 144.50 144.50 144.50

Reserves & Surplus 8,270.90 6,709.40 5,308.10 4,234.30 3,446.70

Total Shareholders Funds 8,415.40 6,853.90 5,452.60 4,378.80 3,591.20

Secured Loans 0.10 63.50 71.70 307.60 311.90

Unsecured Loans 900.10 567.30 0.00 0.00 0.00

Total Debt 900.20 630.80 71.70 307.60 311.90

Total Liabilities 9,315.60 7,484.70 5,524.30 4,686.40 3,903.10

Gross Block 7,285.30 6,146.80 4,954.60 5,053.10 4,566.70

Less: Accum. Depreciation 3,988.80 3,487.10 3,259.40 3,179.40 2,735.90

Net Block 3,296.50 2,659.70 1,695.20 1,873.70 1,830.80

Capital Work in Progress 736.30 250.70 92.00 42.10 74.90

Investments 5,180.70 3,409.20 2,051.20 1,516.60 1,677.30

Inventories 1,038.00 701.40 881.20 666.60 439.80

Sundry Debtors 655.50 747.40 646.10 599.50 689.40

Cash and Bank Balance 324.00 1,422.80 1,401.60 1,029.40 240.20

Loans and Advances 1,920.00 1,643.50 933.10 801.90 775.00

Current Liabilities 2,718.90 2,288.60 1,704.80 1,454.20 1,520.20

Provisions 1,116.50 1,061.40 471.30 389.20 320.40

Net Current Assets 102.10 1,165.10 1,685.90 1,254.00 303.80

Miscellaneous Expenses not w/o 0.00 0.00 0.00 0.00 16.30

Total Assets 9,315.60 7,484.70 5,524.30 4,686.40 3,903.10

Contingent Liabilities 1,241.33 874.90 881.40 1,051.40 1,297.30

The gross revenue (net of excise) ofthe Company for the year was Rs. 188,238 million

as against Rs. 152,523 million in the previous year showing an impressive growth of

23.4%. Earnings before depreciation,interest, tax and amortization (EBDITA) stood at

Rs. 31,308 million against Rs. 25,888 million in the previous year, recording a jump

of 20.9%.Based on technical evaluation and market considerations, the Company has,

with effect from 1st April 2007, revised the estimated useful life of certain assets

which resulted in depreciation being higher by Rs. 2,122 million for the current year

with a corresponding reduction in profit for the year and net fixed assets. Profit before

tax (PBT) stood at Rs. 25,030 million against Rs. 22,798 million in the previous year

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showing a growth of 9.8% and Profit after Tax (PAT) stood at Rs. 17,308 million

against Rs. 15,620 million in the previous year showing a growth of 10.8%.

DIVIDEND:

The Board recommends a dividend of100% (i.e. Rs. 5 per equity share of Rs. 5 each) for the year ended 31 March 2008 amounting to Rs. 1,445million as against a dividend of 90% amounting to Rs. 1,300 million, paid for the year ended 31 March 2007.

CAPITAL HISTORY:

 Year Equity Capital  Remarks 200307 144.46    Public Issue

 199903 132.3    As Per Annual Report

 199303 132.29    As Per Annual Report

FURTURE PROSPECTS

To develop capability for full model change.

To upgrade R&D capabilities for total evaluation of products.

Emphasis on VA-VE & innovative cost reduction ideas to cut down costs.

Carry out continuous up-gradation of existing models.

Maximum localisation for achieving cost reduction in existing as well as new

models.

Compliance with Bharat Stage IV emission norm and other new regulations.

Developing knowledge of costing of various Automotive Technologies

through standard cost tables and cost benchmarking.

Cost planning of new products coinciding with the new Product planning to

put cost in the right perspective at the concept stage and give target cost to

designers.

Design in cost reduction to reduce costs from concept stage itself.

Develop more products with alternative fuel option.

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Keeping promises to get closer to out the customers.

Using technology to give our customers more for less.

THE FURTURE PROMISES:

The Company is taking its interpretation of connect with the customer into a new

paradigm. After

investing in manufacturing facilities,the Company is now ready to invest in marketing

infrastructure. It has identified some mega projects to build the foundation of this new

initiative:

Car display showrooms or brand centres in prominent urban locations, where

customers can see the entire range of models, experience technology and so

on.

Car stockyards is an effort to ensure that customers are able to get their choice

of model, variant and colour, in time.

Spares stockyards in select centres across the country to meet customer

requirements faster.

WHAT’S LATEST IN NEWS ?

Maruti Suzuki to launch 'World Car' from India by end -

2008:Motors'next world car will come from its venture at Gurgaon, near

Delhi, by the end of 2008, Shinzo Nakanishi, managing director of Maruti

Suzuki India, has said."The new model will be launched by end-2008," he

said. "To begin with, we have plans to export 100,000 units of the new model

annually to Europe and the rest of the world," Nakanishi said in an interview.

The Manesar plant at Gurgaon was set up under a joint venture company,

called Maruti Suzuki Automobiles India in which Maruti Udyog Ltd holds 70

per cent equity while Suzuki Motors of Japan holds the remaining 30 per cent.

The total investment in the new car plant was Rs 15.24 bn. The capacity of the

plant will initially be 100,000 cars per annum, with a potential to scale it up to

250,000 units.

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A member of Suzuki Motor's board of directors worldwide, Nakanishi

expressed confidence that the auto major would be able to "maintain its

leadership in the Indian auto market". Suzuki currently holds a 54% stake in

Maruti Suzuki India.

He also added, "What this means is that the Indian customers get international

levels of quality and design. Specifically for India, Splash and A-Star models

will be introduced here as part of our overall World Strategic Model

approach."

Suzuki aims to make India car unit production hub: Japan's Suzuki Motor

Corp expects to make its Indian unit a major production hub and pursue an

aggressive strategy to retain its dominant market share in India, the unit's new

managing director. Japan's Suzuki Motor Corp expects to make its Indian unit

a major production hub and pursue an aggressive strategy to retain its

dominant market share in India, the unit's new managing director said

The company, which is expanding its capacity to hit 1 million units by 2010,

will launch other models that will upgrade consumers from its popular small

cars such as the Alto and Zen Estillo, Shinzo Nakanishi said in e-mailed

responses a day after taking over as managing director.

He said, "We have an aggressive plan for new model launches," said

Nakanishi, who has previously worked in China, Indonesia, Hungary, Pakistan

and the Middle East. "Maruti Suzuki is ready to play a much bigger role in

Suzuki's global operations," he said. "Its manufacturing capability has reached

a level where we want to make small cars exclusively in India for export to

Europe." Of the 3 million cars that Suzuki wants to sell worldwide by fiscal

2010, Maruti Suzuki will account for a third.

"Small cars would continue to grow", says Chairman, Maruti Suzuki: Car

market leader Maruti Suzuki India Limited had its 27th Annual General

meeting.Addressing the shareholders Chairman Mr. RC Bhargava said

emphatically, "The future belongs to small cars."Supporting his statement he

said, "Worldwide there seems to be no respite from increasing fuel prices. In

addition, the commodity prices have also shot up manifold. Therefore, the

demand for small, light-weight, fuel efficient cars would grow and strengthen.

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This trend is clearly visible in global markets and is likely to enter India as

well."

Small is beautiful:Exuding confidence on growth of small cars in the Indian

sub-continent Chairman, MSIL said, "The Government has laid down policies

that favour small cars. We are at an advantageous position because we have an

expertise in designing small cars. With demand for small cars going up we

will quickly scale up our R&D capabilities to design cars that are best suited

for the Indian market."

Investment:The Company has committed to invest Rs 9,000 Crore by 2010 in

India operations. The world class plant at Manesar (part of this investment) is

ready to reach its peak production level of 300,000 units next month. In

addition, the diesel facility and the suppliers' park at Manesar which were

commissioned last fiscal are progressively building capacities, as per plan. The

company will soon commence operations at the new engine series plant at

Gurgaon

On further investment the Chairman remarked, "Maruti Suzuki's great

strengths is that we have internal resources to finance both R&D expansion as

well as capital investments. The higher interest rates, and the risk of making

large borrowings to finance capital costs, will not affect us."

CRITICAL APRAISAL AND SUGGESTIONS:

The company Maruti Suzuki India Limited.(MSIL) has always reacted to the changes

in a positive manner so it could be any thing.

To being with “Maruti Udyog” had changed its name to “Maruti Suzuki”. Suzuki

besides being the parent company, imparts a international dimension in corporate

51

world. Suzuki Motor Corporation is a leading player in the global automobile market

so with the alteration in the company’s name, it has become a leader in India as well

as in other parts of the world.

Maruti Suzuki a leading company in the automobile industry, thereby its chairman

Mr.R.C Bhargava has decided that it wouldn’t response to any other company’s plan.

He has also said that every company has its own strategies and if they would start

reacting on them their statergy would fail.

Maruti Suzuki has no plans to enter in to the competitions with Nano of the TATA

company as Maruti has already been in the small car segment since very beginning,

where as the managing director and the chairman of the company say that Nano has

entered into a completely different segment and they are not competing in that

segement. The introduction of TATA Nano cars is a threart to the two wheelers and

not the Maruti Suzuki products.

Recently in an auto expo in delhi Maruti Suzuki India has show cased three conpect

cars. Namely,Concept A-Star, Concept Splash and Concept Kizashi. Production

models, based on Concept A-Star and Concept Splash, will be launched in India in the

near future, and will contribute to the company’s goal of achieving one million unit

sales by 2010.

SUGGESTIONS FOR THE COMPANY:

I believe Maruti Suzuki is ready to play a major role in global automobile operations,

as they pursue a good code of conduct and has always worked as a corporate

52

governance and have excellent leadership qualities which are essential for any

corporate to a leader in any industry.

As ,maruti has enterd in wide range of exporting its products in the middle east and

asian countries I wish it can have its dealings worldwide.

As a suggestion or piece of advice I would like to say that the company should

produce more an more smaller and affordable cars for its customers.

BIBILOGRAPHY

1. www.maurtisuzuki.com

2. http://www.topnews.in/maruti-will-not-react-another-company-s-plan-

khattar-21433

3. http://www.cmlinks.com/moneypore/profilenew/financial.asp?

mainopt=9&cocode=5496

4. http://www.marutiexports.com/rhdv.asp

5. http://www.infoplease.com/ce6/bus/A0805415.html

6. http://auto.indiamart.com/auto-industry/

7. http://auto.indiamart.com/auto-industry/component-industry.html

8. http://www.surfindia.com/automobile/auto-export.html

9. http://www.energymanagertraining.com/automobile/

IndiaAutomobileIndustry.htm

10. http://www.pcra.org/English/transport/dilipchenoy.p

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