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MD & A
97
CORPORATE OVERVIEW (1-31)
STATUTORY REPORTS
FINANCIALS (123-204)
substantial on-going capital and operating expenditures to
ensure compliance with current and future environmental,
health and safety laws and regulations or their more stringent
enforcement. Other environmental, health and safety laws and
regulations could impose restrictions or onerous conditions
on the availability or the use of raw materials required for the
Company ’s manufactur ing process. The Company ’s
manufacturing process results in the emission of greenhouse
gases such as carbon dioxide.
For Jaguar Land Rover operations, the EU Emissions Trading
Scheme, an EU-wide system in which allowances to emit
greenhouse gases are issued and traded, is anticipated to
cover more industrial facilities and become progressively more
stringent over time, including by reducing the number of
allowances that will be allocated free of cost to manufacturing
facilities. In addition, a number of further legislative and
regulatory measures to address greenhouse gas emissions,
including national laws and the Kyoto Protocol, are in various
phases of discussion or implementation. These measures could
result in increased costs to: (i) operate and maintain the
company’s production facilities; (ii) install new emissions
controls; (iii) purchase or otherwise obtain allowances to emit
greenhouse gases; and (iv) administer and manage the
company’s greenhouse gas emissions programme.
Inability to attract and retain skills
: The Company believes
that the Company’s growth and future success depend in large
part on the skills of the Company’s workforce, including
executives and officers, as well as the designers and engineers.
The loss of the services of one or more of these employees
could impair the Company’s ability to continue to implement
its business strategy. The Company’s success also depends, in
part, on the Company’s continued ability to attract and retain
experienced and qualified employees, particularly qualified
engineers with expertise in automotive design and
production. The competition for such employees is intense,
and the Company’s inability to continue to attract, retain and
motivate employees could adversely affect its business and
plans to invest in the development of new designs and
products.
Outlook
In India, the current year ended with slow growth in most of
the critical segments, mainly due to anti inflationary monetary
policy pursued by the RBI. The current fiscal has started with a
positive action by the RBI of easing of the monetary policy in
April 2012, with an expectation of moderating the inflation.
However, a series of such cuts would be required to revive
industrial growth. Liquidity in the banking system which
remained in the deficit for the whole of FY 2011-12, remains
a concern. While the situation is improving in Q1 of FY 2012-
13, this remains critical to ensuring sustainable growth
While there continues to concurrence over deteriorating
Government finances and slowing pace of reforms, there is
an expectation of fiscal consolidation back on track giving
fillip to savings and capital formation. The service sector
will continue to contribute positively. On the assumptions of
good monsoon, the growth in agriculture is likely to be
rebound. The RBI is likely to ease the monetary policy based
on review of inflation. The Indian economy is likely to
grow moderately at 7.6% (+ -0.25%). These factors could
improve investment outlook on disposable income from
Q2 of FY 2012-13.
Input costs continue to remain under pressure from increasing
commodity prices. With increased intensity in the competitive
scenario, pricing power remains limited and margins are likely
to be under pressure.
Against this backdrop, the Company will continue to focus on
providing new products and solutions to the customer with a
view to reduce the Total Cost of Ownership. Along with initial
acquisition price, the focus would be on improving fuel
efficiency and reducingmaintenance costs of the vehicles. With
a view to maintain its advantage of reach and penetration, the
FINANCIAL HIGHLIGHTS (32-45)