Bankers - Bombay Stock Exchange...Share Registrar & Alankit Assignment Limited Transfer Agent 2E/21 Alankit House, Jhandewalan Extension New Delhi-110 055 Tel. : 011-42541234 Fax:

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Director(s) Kapil Kapoor Non-Executive Director & –ChairmanAs on 26 May, 2011 V D Wadhwa Managing Director

Frank Sherer Non-Executive DirectorDaya Dhaon Non-Executive & Independent DirectorGagan Singh (Ms.) Non-Executive & Independent DirectorPradeep Mukerjee Non-Executive & Independent Director

Bankers The Hongkong & Shanghai Banking Corporation LimitedHDFC Bank Limited

Auditors BSR & Co.,Chartered Accountants

Registered Office 117 G.F. World Trade Centre,Babar Road, New Delhi – 110001.

Works Plot No.10Baddi Industrial AreaKatha BhatoliBaddi, Distt. Solan (H.P)

Share Registrar & Alankit Assignment LimitedTransfer Agent 2E/21 Alankit House,

Jhandewalan ExtensionNew Delhi-110 055Tel. : 011-42541234Fax: 011-42541967Email.: [email protected] : www.alankit.com

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NOTICE

Notice is hereby given that the Twenty-third Annual General Meeting of the Members of TIMEX GROUP INDIA LIMITEDwill be held on Friday, 29th July, 2011 at 11.00 A.M. at the Siri Fort Auditorium, August Kranti Marg, New Delhi- 110049, totransact the following business:

ORDINARY BUSINESS

1. To receive consider and adopt the Balance Sheet as at 31 March, 2011, Profit and Loss Account for the year ended onthat date and the report of the Auditors and Directors thereon.

2. To declare and pay Dividend on Preference Shares.

3. To appoint a Director in place of Mr. Frank A Sherer who retires by rotation and being eligible, offers himself for re-appointment.

4. To appoint a Director in place of Mr. Pradeep Mukerjee who retires by rotation and being eligible, offers himself for re-appointment.

5. To appoint Statutory Auditors from the conclusion of this Annual General Meeting until the conclusion of the nextAnnual General Meeting.

M/s BSR & Co., the retiring Auditors, being eligible, offer themselves for reappointment on a remuneration to be fixed by theBoard of Directors of the Company in addition to reimbursement of all out of pocket expenses.

NOTES

1. A MEMBER ENTITLED TO ATTEND AND VOTE IS ENTITLED TO APPOINT A PROXY TO ATTENDAND VOTE INSTEAD OF HIMSELF AND THE PROXY NEED NOT BE A MEMBER.

2. Mr. Frank A Sherer and Mr. P Mukerjee retire by rotation at the ensuing Annual General Meeting and being eligible offerthemself for reappointment. Brief resume of these Directors, nature of their expertise and names of Companies in whichthey hold Directorship and membership / Chairmanship of Board Committee as stipulated under Clause 49 of the ListingAgreement with the Bombay Stock Exchange are provided in the Report on Corporate Governance forming part of theAnnual Report. The Board of Director of the Company commends their re-appointments.

3. The proxy form duly completed in all respects should reach the Registered Office of the Company not later than 48hours before the commencement of the meeting.

4. The Register of Members and the Register of Share Transfers of the Company have remained closed during 29 June2011 & 30 June 2011 both days inclusive.

5. The members are requested to inform changes, if any, in their Registered Address along with Pin Code Number to theCompany at the following Address:

TIMEX GROUP INDIA LIMITED(Investors Relation Department)117, Ground Floor, World Trade CentreBabar Road, New Delhi – 110 001

6. The dividend declared by Board of Directors 0n 1,57,00,000 Cumulative redeemable non-convertible Preference Sharesissued on 27 March, 2004 and 2,29,00,000 issued on 21st March, 2006 and also 25,00,000 Non-cumulative RedeemablePreference shares issued on 25 March, 2003 in favour of Timex Group Luxury Watches BV (formerly known as TimexWatches BV) will be paid/ distributed within the statutory period of 30 days after declaration by Members in this AnnualGeneral Meeting.

7. The Members attending the meeting are requested to bring the enclosed attendance slip and deliver the same after fillingin their folio number at the entrance of the meeting hall. Admission at the Annual General Meeting venue will be allowedonly on verification of the signature(s) on the Attendance Slip.

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Duplicate attendance slip shall not be issued at the Annual General Meeting venue. The same shall be issued at theRegistered Office of the Company up to a day preceding the day of the Annual General Meeting.

8. As a measure of economy, copies of the Annual Report will not be distributed at the venue of the Annual GeneralMeeting. The Members are, therefore requested to bring their copies of the Annual Report to the meeting.

9. The Members desirous of any information on the Accounts are requested to write to the Company at least a week beforethe meeting so as enable the management to keep the information ready.

10. The Non Resident members are advised to provide their correspondence address in India and to give mandate forremittance of dividend directly to their bank account(s) in future.

Registered Office :117, Ground Floor,World Trade Centre, By Order of theBabar Road,New Delhi – 110 00 Board of Directors

Dated: 26 May 2011 Kapil Kapoor Chairman

Important Communication to Members

The Ministry of Corporate Affairs has taken a “Green Initiative in the Corporate Governance” by allowing paperlesscompliances by the Companies and has issued circulars stating that service of notice/ documents including AnnualReport can be sent by e-mail to its members. To support this green initiative of the Government in full measure,members who have not registered their e-mail addresses, so far, are requested to register their e-mail addresses, inrespect of electronic holdings with the Depository through their concerned Depository Participants. Members whohold shares in physical form are requested to fill the appropriate column in the members business reply form (referpage 47 of the Annual Report) and register the same with Alankit Assignment Limited. Postage for sending thebusiness reply form will be borne by the Company.

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DIRECTORS’ REPORT

To the Members of Timex Group India Limited

Your Directors are pleased to present the Twenty-third Annual Report and Audited Statement of Accounts for the year ended31 March 2011.

FINANCIAL RESULTS Rs. in Thousands

2010-11 2009- 10

Income 1739082 1400709

Expenditure 1563321 1341958

EBIDTA 192734 83311

Interest 47 1679

Depreciation 16926 22881

Profit before tax (PBT) 175761 58751

Provision for Taxes 35663 12518

Profit after Tax 140098 46233

The economic environment for the domestic business continued to remain conducive for most part of the year and all majorplayers in the watch industry witnessed strong growth, which was largely driven by fashion and youth segment andexpansion of the retail footprint. The high inflation rate and rising cost of commodities prices, if not contained, is likely toadversely impact the consumer sentiment and the overall economic growth environment in the year ahead.

The year 2010-11 has been a year of major transformation, during which, your Company has delivered its highest ever volume,revenue and profitability performance. Sales Revenue grew by 25% at Rs 174 Crore and Profit before tax grew by 203% at Rs14 Crore.

The year begun with a leadership change in the management team and the subsequent finalization of your Company’s threeyears strategic plan. Under the new leadership, several key initiatives were taken to drive efficiencies across the organizationand also align all stakeholders of the Company with the goals to create a strong sense of vision and focus for the business.

Some of the key marketing initiatives taken were as under;

• Revamped the product portfolio and introduced new styles with improved aesthetics and at the same time generated ahigher gross margin for the business.

• Launched New Brands – to target different consumer segments and widen the appeal of the Timex Group Portfolio. Thebrands launched this year were;

o Mark Ecko : in the fashion segment

o Versace : in Luxury fashion segment

o Tarun Tahiliani : in the premium women’s segment

o Helix : in the fast growing youth segment

• Partnered with “ICC Cricket World Cup 2011” event as the “Official Product Licensee”

• Increased media spend with a focus on Television Advertising. A new brand television commercial was developed forthe Timex brand during the year to reinforce the “conversation starters” theme. This campaign was well received bytrade and consumers.

• Visual Merchandising development. A marketing toolkit was conceptualized and executed across points of sale in thedifferent store formats. This has helped build a consistent image for the different brands across the country.

• Expanded the number of franchised retail stores, “The Time Factory”, to 76 during the last year.

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MANAGEMENT DISCUSSION AND ANALYSIS

THE INDIAN WATCH MARKET

The size of Indian watch market is estimated to be at Rs 5000 Crores of which 60% of the business is contributed by theorganized sector. The brands at the premium end of the market and in the fashion and youth segments continue to growsignificantly faster than other brands. While the unit growth is driven by low price unbranded products, the growth at the midand higher price points is driven by creating higher value through improved styling and technology features. The growth inthe market has been led by marketing investments made by several Indian and Global brands (including the launch of severalnew brands) which are increasing their focus on the Indian market. This increased competition and marketing investment isa good sign; since we believe this will drive the growth of the industry, which is still in a nascent stage when compared topenetration in developed countries.

The entry of several brands especially in the Fashion and Luxury segments of the market has resulted in increased competitionfor the rather limited retail space available in the multi brand watch retail environment. And in turn this has led to furtherinvestment and development of “modern retail” channels to meet the increased demand. The industry has overall witnessedan increase in the contribution of “modern retail” to the overall business. The development of this channel, while enhancingthe consumer buying experience in terms of an international environment to shop in, is leading to an increase in marginexpectations from the branded companies. In view of this, companies which are in a position to offer a portfolio of brands arebetter positioned for faster and profitable growth.

OUTLOOK/OPPORTUNITES & KEY CHALLENGES

The economic growth of India and the changing life style of the Indian consumers (especially the relatively younger consumers)who are aspiring to a more international way of life on account of the growing awareness of the global fashion trends, bodeswell for the growth of the watch industry. And your company is well positioned to take advantage of this.

The company has an unique advantage of having several international brands with domestic manufacturing capabilities.This allows international products to be sold in India at prices which offer tremendous “Value for Money” to the consumer.The company also boasts of a portfolio of seven Global brands and the presence of its own franchised retail chain, “The TimeFactory”, comprising of 76 stores. This allows TGIL to participate at all ends of the value chain which in turn enhancesmargins. By doing so, the company is also better positioned to control its own destiny more effectively and this provides asustainable growth platform for the business in the years ahead.

In addition, your Company continues to enjoy the support of the Timex Group Global Design Centre located in Milan and alsoGlobal Supply Chain organization to support the business in India which has resulted in improved technology and styling ofthe products.

The watch industry has changed significantly over the last few years and watches are being used as a fashion accessorymore than a time telling device. This has resulted in a trend for multiple watch ownership;” A different watch for differentoccasions”. This is an encouraging trend for the industry and could propel industry growth significantly in future years andTGIL with its wide array of brands and styles, ranging from Fashion and Classics to Sports can take full advantage of this.

In addition, India continues to be a key strategic market for the Timex Group and therefore enjoys easy access to its globalresources across all functional areas, which should help improve our operational efficiencies due to the scale of the Group’sglobal operations.

Finally, at TGIL, we are benefiting from the operating leverage we now enjoy as a business and this means that future growthwill be more profitable.

RISKS / THREATS

The increase in the commodities prices, increased cost of sourcing from China and limited vendor capacity for the criticalwatch parts in India are resulting in the increase in the sourcing costs of key components. The rising input costs shall havean adverse impact on the operating margins, unless mitigated through various measures to cut costs (without compromisingquality). Several initiatives are being developed to address this risk.

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The ‘Tsunami’ in Japan has severely impacted the supply of watch movements in the last few months, which has sinceimproved. Re-occurrence of such disasters in future could cause a supply chain risk for the Category.

In addition to this, increasing consumer preference for usage of mobile phones as a time keeping device instead of watchesalso pose a major threat especially with the category of consumers who still use a watch to tell time. This is being suitablyaddressed by several marketing initiatives by promoting watches as a fashion accessory as indicated in the section above.

GOVERNMENT POLICY

Your Company has been actively involved with the “All India Federation of Horological Industries”, an apex body ofHorological Industry in India. Your Company together with AIFHI has been taking up issues concerning the Watch Industryand your Company in particular, with the various government agencies. With the active participation by majority of brands inthe Category, AIFHI has released a white paper on the industry, highlighting the key issues for which a change in GovernmentPolicy is recommended and taken up with the respective authorities for the overall growth of the industry. We shall continueour efforts to represent the interests of the Industry and your own Organisation.

FINANCE

Your Company has been able to manage its cash flow through improved collections and utilized the surplus cash to reducethe borrowings and accounts payable, which has resulted in savings in Interest costs despite firming up of Interest Rates.

The Company does not hold any fixed deposits from the public, shareholders & employees. There were no overdue /unclaimed deposits as on 31 March 2011.

During the year under review, the Company made payment aggregating to Rs.32.58 Crore by way of Central, State and localsales taxes and duties as against Rs. 30.06 Crore in the previous year.

Your Company is also paying dividend on its Preference Shares at the agreed coupon rate.

SEGMENT WISE REPORTING

The segment wise information for watches and other activities are provided in the Notes to the Accounts.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

Your Company has endeavoured to continuously improve the internal controls both relating to financial reporting andOperations. Your Company has well established procedures for internal control, which are commensurate with its size andoperations.

The internal control mechanism comprises of a well-defined organization, who undertake time bound audits and report theirfindings to the Audit Committee, documented policy guidelines, predetermined authority levels and processes.

The systems and operations are regularly reviewed by the Audit Committee to ensure and review their effectiveness andimplementation. The Statutory Auditors of the Company also attend these meetings and convey their views on the adequacyof internal control systems as well as financial disclosures. The Audit Committee also issues directives for enhancement inscope and coverage of specific areas, wherever felt necessary.

HUMAN RESOURCES

“Human Resources” continues to be a major thrust area in Your Company, which is highly critical for business expansion andgrowth. Your Company provides a challenging work environment that encourages meritocracy at all levels and has believedin an environment that fosters accomplishment, ownership, creativity and mutual respect.

Your Company comprises a small team of professionals, who are result oriented, committed and loyal.

Attracting and retaining the bright talent and improvement in the quality of manpower at retail stores are identified as keychallenges and being addressed accordingly through various training initiatives and retention tools.

The information required as prescribed under Section 217 (2A) of the Companies Act, 1956, read with the Companies (Particularsof Employees) Rules, 1975 is annexed herewith forming part of this report. However as per provisions of Section 219 (1) (b) (iv)

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of the Companies Act, 1956, only the report and accounts are being sent to all the shareholders excluding the statement ofparticulars of employees under Section 217 (2A) of the Act. Any shareholder interested in obtaining a copy of the saidstatement may write to the Company Secretary at the Registered Office address of the Company.

CAUTIONARY STATEMENT

Statements in the Management Discussion and Analysis, outlining the Company’s objective, expectations or predictionsmay be ‘forward looking statements’ within the meaning of applicable laws and regulations. Actual results could differmaterially from those expressed or implied in the statements. The important factors that could influence the Company’soperations include demand and supply conditions affecting sale price of finished goods, input availability and prices,changes in government regulation, tax laws, economic developments within the country and abroad and such other factorssuch as litigation and industrial relation etc.

DEMATERIALISATION

Since year 2000, the equity shares of your Company are being compulsorily traded in dematerialization form. As on date,31802 no. of shareholders representing 21.96% of the Equity Share are holding shares in the dematerialized form.

DIRECTORS

In accordance with Section 255 and 256 of the Companies Act, 1956 and Articles of Association of the Company, Mr. Frank ASherer and Mr.Pradeep Mukerjee retire by rotation as Director of the Company and being eligible, offers themselves forreappointment.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 217 (2AA) of the Companies Act, 1956, your Directors confirm as under:

(i) That in preparation of the Balance Sheet and the Profit & Loss Account of the Company, the applicable accountingstandards has been followed along with proper explanation relating to material departures.

(ii) The Directors had selected such accounting policies and applied them consistently and made judgments and estimatesthat are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of thefinancial year and of the profit of the Company for that period.

(iii) The Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordancewith the provisions of the Companies Act, 1956, for safeguarding the assets of the Company and for preventing anddetecting fraud and other irregularities.

(iv) That the Directors have prepared the Annual Accounts on a going concern basis.

(v) That due to sudden demise of Mr. Raghu Pillai on 10th April, 2011, who was one of the Director on the Board, representationu/s 274 (1) (g) was not received prior to the date of Audit Report, however, later representations u/s 274 (1) (g) have beenreceived from two Companies, where he was a Director.

CORPORATE GOVERNANCE

As per Clause 49 of the Listing Agreement with the Stock Exchanges, a separate section on Corporate Governance togetherwith a certificate from the Company’s Auditors confirming compliance is set out in the Annexure forming part of this report.

CONSERVATION OF ENERGY

Information required as per Section 217 (1) (e) of the Companies Act, 1956, read with the Companies (Disclosure of Particularsin the Report of Board of Directors) Rules, 1988, regarding conservation of energy, technology absorption and foreignexchange earnings and outgo is given in the Annexure forming part of this report.

AUDITORS

M/s BSR & Co., Chartered Accountants and Statutory Auditors of the Company retire and are eligible for reappointment.

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ACKNOWLEDGEMENTS

Your Directors wish to place on record their appreciation for the support and cooperation, which the Company continues toreceive from its customers, the watch trade, the New Okhla Industrial Development Authority, the Governments of UttarPradesh and Himachal Pradesh, and finally the Members of the Company and its employees.

For and on behalf of the Board of Directors

New Delhi Kapil Kapoor26 May, 2011 Chairman

ANNEXURE TO THE DIRECTOR’S REPORT

(Additional Information given in terms of notification no.1029 of 31 December, 1988 issued by the Department of CompanyAffairs)

PARTICULARS WITH RESPECT TO CONSERVATION OF ENERGY

POWER AND FUEL CONSUMPTION

2010-11 2009-10

UPSEB/ HPSEB Power purchase (units) 650084 691056

Total Amount (in Rs.) 3289479 2921900

Rate per unit (in Rs.) 5.06 4.23

Own generation (units) 81902 84100

Cost per unit (in Rs.) 9.95 8.00

Units per litre of diesel 3.62 3.65

TECHNOLOGY ABSORPTION

Research and Development (R&D)

Areas in which R&D carried out by the Company

Development -

1) Conversion of Movements VX82/VX83 from open-type toolings to line toolings.

2) Installation of conveyorized system for movement 905/ 930/ 916 assembly line.

3) Semi-automation of Caseback Closing Press

4) Open type toolings developed for VX36/VX3R/VX3T movements.

Future plan of action

1) Conversion of VX3N/VX3P/VX3S from open-type tooling to line toolings.

2) Set up of new production line to increase assembly capacity by 2000 watches per day.

3) E-tester automation for 930/905/916 movements.

Technology Absorption, Adoption and Innovation Benefits

Upgraded process automations will help improve productivity and quality and reduce assembly costs.

Foreign Exchange Earned

The Company has earned Rs. 7.88 Crores in Foreign exchange and used Rs. 39.98 Crores.

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REPORT ON CORPORATE GOVERNANACE

Your Company appreciates the need of upholding highest standard of Corporate Governance in its Operation. It has alwaysbeen an endeavor of the Company to adopt & implement best Practices of Corporate Governance, disclosure standards andenhancing shareholder value while protecting the interests of other stakeholders, clients, suppliers and its employees.

As mandatory under Clause 49 of the listing Agreement, the Company has complied with the conditions of CorporateGovernance by establishment of a framework for compliance with SEBI Regulations.

A. MANADATORY REQUIREMENTS

CORPORATE GOVERNANCE PHILOSOPHY

Corporate Governance assumes a significant role in the business life of Timex. The driving forces of Corporate Governanceat Timex are its vision and core values, as described hereunder:

VISION

The Timex Group vision is anchored in our rigorous focus on long lasting relationships with our customers and ourcommitment to build the power of our brands, underpinned by our peoples will to win.By transforming ourselves into a truly Global Company and intent on globalizing the mindset of our people, we arebuilding one of the most powerful portfolios of brands in the watch and jewelry industry.Our vision for the future goes way beyond timekeeping. We will delight and surprise our customers throughinnovation in design, technology and application of our brands and deliver a superior customer experience. Thiswill lead to enhanced values for our shareholders and increase returns on investments and assets.Deeply committed to our Corporate Social Responsibility and our values, we will build pride in our people and winthe best future talent for our Group.

VALUES

• The customer is our most important asset,• Corporate Social Responsibility is our foundation,• Truth, transparency and respect for our differences are our pillars of strength,• We work together to achieve Group goals,• Our core values encompass integrity, responsibility and courage,• We reward performance and results and we value a culture of discipline,• We are fair and listen to our people and we expect them to always look for a better way,• We protect our assets,• We want to win.

BOARD OF DIRECTORS

(a) Composition of the Board

The Board of Directors of the Company was reconstituted on 14th April, 2011 and comprises six members, which includesfive Non-executive directors. The day-to- day management of the Company is conducted by Mr. V.D.Wadhwa, ManagingDirector of the Company subject to the supervision and control of the Board of Directors of the Company. Mr. KapilKapoor a Non-executive Director is Chairman of the Board and Mr. Frank Sherer is Non-Executive Director. Mr DayaDhaon, Ms. Gagan Singh and Mr. Pradeep Mukerjee are Independent Directors on the Board of the Company, presently.The number of Independent Directors is one half of the total strength of the Board. The Directors are well qualifiedprofessionals in business, finance and corporate management and the Company is in compliance with the Clause 49 ofthe Listing Agreement as regards composition of the Board.

(b) Appointment of Director(s)

Pursuant to Article 106 of the Articles of Association of the Company, the Board of Directors appointed Mr. KapilKapoor as Chairman of the Board effective 16 February, 2011 who shall not be liable to retire by rotation.

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Mr. Frank A Sherer and Mr. Pradeep Mukerjee retire by rotation as Director of the Company and being eligible, offersthemselves for reappointment at this meeting.

Mr. Sherer is a Legal Professional who is associated with Timex Group, U.S.A for over twenty- five years and currentlyheading Legal & Human Resources functions for the entire group.

Mr. Mukerjee is a seasoned HR Professional with over 30 years of experience. He is presently the founder–Director ofConfluence Coaching and Consulting and also an Independent Director on the Board of Future Capital FinancialServices Limited and Future Capital Holding Limited. Earlier, he was associated with CITI GROUP as Human ResourceDirector & VP, India, Sri Lanka and Bangladesh.

(c) Board Meetings

The Board met six times during financial year 2010-2011 on 29 April,2010, 27 May, 2010, 21 July, 2010, 28 October, 2010,28 January, 2011 and 16 February,2011 to consider amongst other business matters, the quarterly performance of theCompany and financial results. Directors attending the meeting actively participated in the deliberations at thesemeetings.

(d) Composition and Category of Directors

The details of the composition and category of Directors as on 31 March 2011 are given in the table below:

Name Category Designation No. of No. of No. of No. of No. of AttendanceShares Meetings Meetings Memberships Memberships of eachHeld held attended in Boards in Committees Director

During of other of other at lastthe last Companies(1) Public AGMfinancial Companies (2)year

Kapil Kapoor Non-Executive Chairman 2100 6 6 2 3 YesDirector

V D Wadhwa Executive Managing 600 6 6 1 1 YesDirector Director

Daya Dhaon Independent Director - 6 6 - - YesDirector

Raghu Pillai Independent Director - 6 4 3 - YesDirector

Gagan Singh (Ms.) Independent Director - 6 5 - - YesDirector

Frank Sherer Non-Executive Director - 6 1 - - -Director

Pradeep Mukerjee Independent Director - 6 5 2 - YesDirector

1. Does not include directorships / committee position in Companies incorporated outside India.

2. Only Audit Committee and Shareholders Grievance Committee have been considered for the purpose of ascertaining no.of membership & Chairmanship of Committee across all the public companies.

3. Mr. Kapil Kapoor has been appointed as Chairman of the Company in place of Mr. Frank Sherer w.e.f. 16 February,2011

4. Mr. Raghu Pillai ceased to be a director on the Board since 10 April, 2011 due to his sudden demise on that date.

Code of Conduct

The Company has formulated and adopted a Code of Conduct for its Board of Directors and senior management and has putup the same on the Company’s website www.timexindia.com. The Code has been circulated to all members of the Board andSenior Management and they have affirmed the compliance of the same. A declaration signed by the Managing Director ofthe Company is annexed hereto.

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Audit Committee

The Audit Committee of the Company was constituted in July 1999 in line with the provisions of clause 49 of the listingagreement with the Bombay Stock Exchange read with section 292A of the Companies act, 1956. The Company Secretary ofthe Company acts as the Secretary of the Committee.

The Company has an adequately qualified and independent Audit Committee. Due to demise of Mr. Raghu Pillai on 10th ofApril 2011 the Committee now comprises of four Non-Executive Directors: Mr.Daya Dhaon, Mr. Frank Sherer, Ms. GaganSingh and Mr. Pradeep Mukerjee. Three of the four members on the Committee are independent. The Committee is chaired byMr. Daya Dhaon, who is an independent Director having vast experience and expertise in the area of finance and accounts.

The charter of role and responsibilities of the Audit Committee includes the following major areas;

� Reviewing the adequacy of internal control system and the Internal Audit Reports, and their compliance thereof.

� Oversight of the Company’s financial reporting process and the disclosure of its financial information to ensure that thefinancial statements are correct, sufficient, and credible.

� Recommending the appointment of external auditors and fixation of their audit fee, and also approval for payment forany other services

� Reviewing with Management the quarterly and annual financial statements before submission to the Board, focusingprimarily on:

� Any changes in accounting policies and practices.

� Major accounting entries based on exercise of judgment by management.

� Significant adjustments arising out of audit.

� Qualifications in draft audit report.

� The going concern assumption.

� Compliance with accounting standards.

� Compliance with Stock Exchange and legal requirements concerning financial statements.

� Any related party transactions i. e. transactions of the Company of material nature, with promoters or themanagement, their subsidiaries or relatives etc, which may have potential Conflict with the interests of Companyat large.

During the year under review, the Audit Committee met four times on 27 May 2010, 21 July 2010, 28 October, 2010 and 28January 2011. The details of member’s attendance at the Audit Committee Meetings are as under;

Name of Director Designation Total no of Meetings No of meetings held in 2010-11 attended

Mr. Daya Dhaon Chairman & 4 4Independent Director

Mr. Frank Sherer Non-Executive 4 0Director

Mr. Raghu Pillai Non-Executive 4 3Independent Director

Ms. Gagan Singh Non-Executive 4 3Independent Director

Mr. Pradeep Mukerjee Non-Executive 4 4Independent Director

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The Chief Financial Officer, Head of Internal Audit function and the Statutory Auditors were invited and they duly attendedthe Audit Committee meetings. The Committee held discussions with the management of the Company and with the StatutoryAuditors to review the quarterly, half-yearly and annual audited financial statements and to recommend its views to the Boardof Directors of the Company. The Committee also reviewed the internal control systems and the effectiveness of InternalAudit function.

REMUNERATION COMMITTEE

The Remuneration Committee was constituted in May 2003, to decide and recommend the remuneration of directors includingthe Managing Director of the Company. Effective 29 April 2010, the remuneration of all the Sr Management of the Companywith direct reporting to the Managing Director of the Company is also reviewed and recommended by the RemunerationCommittee. Due to demise of Mr. Raghu Pillai on 10th of April 2011, the Committee now comprises of four Non- executiveDirectors, namely Mr. Daya Dhaon, Ms. Gagan Singh, Mr. Frank Sherer and Mr. Pradeep Mukerjee. Mr. Daya Dhaon, anindependent Director is Chairman of the Committee. The Committee meets periodically as and when required. None of thedirectors, except Managing Director draws remuneration from the Company.

The details of member’s attendance at the Remuneration Committee Meetings are as under;

Name of Director Designation Total no of Meetings No of meetings held in 2010-11 attended


Mr. Frank Sherer Non-Executive 2 1 Director




SHAREHOLDERS/INVESTORS GRIEVANCE COMMITTEE

A Shareholders / Investors Grievance Committee headed by a Non-Executive Director was formed in January 2002 which wassubsequently merged with the Share Transfer Committee on 31 July 2002 in view of the commonalities of area of work and wasrenamed as Share Transfer & Shareholders / Investors Grievance Committee, to approve all matters pertaining to sharetransfers, transmissions, issuance of duplicate shares, transposition etc and also to provide the shareholders of the Companywith additional assurance that sufficient information is being provided to enable them to form a reasoned opinion on theworking of the Company and to ensure speedy redressal of their grievances pertaining to share related issues.

CONSTITUTION AND COMPOSITION

Due to demise of Mr. Raghu Pillai on 10th of April 2011, the Committee now comprises of four non-executive Directors namely,Mr. Frank A Sherer, Mr. Daya Dhaon, Ms. Gagan Singh and Mr. Pradeep Mukerjee. The Chairman of the meeting is elected bymajority at each meeting. The Company Secretary is the Secretary of the Committee and has attended its meetings. She/Headdresses shareholders complaints, monitors share transfer process and liaisons with the regulatory authorities, as required.

The details of member’s attendance at the Investor Grievance Committee Meetings are as under;

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Name of Director Designation Total no of Meetings No of meetingsheld in 2009-10 attended


Mr. Frank Sherer Non-Executive 4 0Director




The Committee was formed specifically to look into the redressal of shareholders & investors grievances pertaining to:

1) Transfer of shares and its timelines2) Transmission of shares3) Issuance of duplicate shares4) Investors / shareholders grievance(s) pertaining to all type of matters concerning their dealing with the Company with

respect to their investment in the securities of the Company, more specifically pertaining to non-receipt of AnnualReports, delay in transfers, non redressal of complaints, non receipt of dividend, dematerialization related issues etc.

5) All other day-to-day matters governing the relationship between the Company and its shareholders.

DISCLOSURES

(a) Related Party Transactions: The Audit Committee has been reviewing the disclosure of Related Party Transactionsperiodically. There is a cross charge of expenses which is established between your Company and Timex GroupPrecision Engineering Limited (Group Company) on account of Manpower Cost and Rentals respectively. Besidethis transaction, the Company does not have any related party transactions, which are material in nature thatwould have a potential conflict with the interests of the Company at large.

(b) Details of Non-compliance: There have been no cases of penalties, strictures imposed on the Company by StockExchange or SEBI or any other statutory authority, on any matter relating to capital markets, during the last threeyears.

(c) Risk Management: The Company has laid down procedures so as to ensure that the executive managementcontrols risk through means of a properly defined framework and to inform the Board members about the same andhas engaged the services of a leading Chartered Accountant’s firm to carry out this activity on a regular basis andinform the Board members about the risk assessment and minimization procedures.

(e) Secretarial Audit : Pursuant to Clause 47( c ) of the Listing Agreement with the Stock Exchange, certificates onhalf-yearly basis, have been issued by a Company Secretary-in-Practice for due compliance of share transferformalities by the Company. Pursuant to SEBI (Depositories and Participants) Regulations, 1996 certificates havealso been received by a Company Secretary-in-Practice for timely dematerialization of share of the Company andfor conducting a secretarial audit on a quarterly basis for reconciliation of the share capital of the Company.

(f) Disclosure of Accounting Treatment: The Company follows Accounting Standards issued by the institute ofChartered Accountants of India and in the preparation of financial statements; the Company has not adopted atreatment different from that prescribed in any Accounting Standard.

(g) Proceeds from Issue of Preference Shares: The Company has raised funds through issues of preference sharesduring financial year 2002 -2003, 2003-2004, 2005 -2006. The proceeds of the preference share issue have beenlargely utilized towards repayment of the term loan, pending full utilization allocated for the retail venture. TheBoard/ Audit Committee reviews the Utilization details periodically.

14

(h) CEO/CFO Certification : The Managing Director (CEO) and Chief Financial Officer(CFO) have placed before theBoard of Directors a certificate relating to the financial statements, in accordance with clause 49 (V) of the ListingAgreement for the financial year ended March 31, 2011 which is annexed hereto.

DIRECTORS’ REMUNERATION

Pecuniary Relationships

None of the Directors’ of your Company except Managing Director has any pecuniary relationships or transactions with theCompany except for attending Board meetings or Committee Meetings thereof. The Directors of the Company are only paidsitting fees. However, the Managing Director of the Company draws remuneration from the Company.

MEANS OF COMMUNICATION

Website, where results are displayed : The financial results are displayed onwww.timexindia.com

Quarterly Results : Financial Results are published in theNewspapers as required under the Listing Agreement.

Annual Results : -do-

Newspaper in which results are normally : The Business Standard, Business Standardpublished Vernacular published (Hindi) Newspaper.

Whether Management Discussion &Analysis is a part of the Annual Report : Yes

All Financial Results and other material information about the Company are promptly sent through fax to the Bombay StockExchange and the same is then either hand delivered or sent by courier to the respective Stock Exchange.

GENERAL SHAREHOLDERS’ INFORMATION

AGM:Date,time and venue : Friday, 29 July, 2011 11:00 a.m. at Siri fort Auditorium,August Kranti Marg, New Delhi – 110 049.

Financial Year : April 1, 2010 to March 31,2011

Directors seeking appointment/ : As required under Clause 49(IV)(G), particulars of Directors seekingre-appointment appointment/re-appointment are given in the Report on Corporate

Governance forming part of the Annual Report.

Tentative calendar of events for : To review and approve unaudited Financial Results for the quarterthe financial year 2011-12 First quarter - ended July 2011(April – March) Second quarter - ended October 2011

Third quarter - ended January 2012Fourth quarter - ended May/June 2012

Book closure Date : 29 June to 30 June,2011 (both days inclusive)

Listing of shares on Stock Exchanges : Bombay Stock Exchange, Phiroze Jeejeebhoy Towers, Dalal Street, Mumbai – 400001

Registered Office : 117, Ground Floor, World Trade Centre, Babar Road, New Delhi-110001.

Listing Fees : Listing fees as prescribed has been paid to the Stock Exchange up to March,31,2011

Share Registrar & Transfer Agents : Alankit Assignment Limited 2E/21 Alankit House, Jhandewalan Extension,New Delhi – 110055 of the Company for both physical and electronic modeof share transfers.Contact Person : Mr. Y K Singhal, Vice President.Phones : 011-42541234Fax : 011-23552001Email : [email protected]

[email protected] : www.alankit.com

15

SHARE TRANSFER SYSTEM

The Company has appointed Alankit Assignment Limited as Registrar and Shares Transfer Agent. Shares sent for transfer inphysical form are registered by the Registrar and Share Transfer Agents within fifteen days of receipt of the documents, iffound in order. Shares under objection are returned within two weeks. All requests for dematerialization of shares areprocessed, if found in order and confirmation is given to the respective depositories i.e. National Securities DepositoryLtd.(NSDL) and Central Depository Services Limited (CDSL) within twenty-one days.

All the transfers received are processed and approved by the Share Transfer & Shareholders / Investors Grievance Committeeat its meetings. For redressal of transfer related grievances, shareholders may contact Mr. Vikram Bhardwaj, DGM – Legal andSecretarial at the registered office address of the Company

INVESTOR SERVICES

Number of Complaints received, not solved & shares pending transfer

Complaints outstanding as on April,1, 2010 0

Complaints received during the year ended March 31,2011 69

Complaints resolved during the year ended March 31,2011 69

Complaints pending as on March 31, 2011 0

OTHERS

Name and designation of compliance officer: Mr. Vikram Bhardwaj, DGM – Legal & Secretarial.

Venue and Time of the Last Three General Body Meetings

Date Category Venue Time No. of Members present by Representative ofSpecial Body CorporateResolutions

Person Proxy

23.08.2008 AGM Air Force 10.00 AM 2 2099 31 1Auditorium,Subroto Park,New Delhi

30.07.2009 AGM FICCI 10.00 AM - 2447 51 1Auditorium,Tansen Marg,,New Delhi

22.07.2010 AGM Air Force 10.00 AM - 2506 1 1AuditoriumSubroto Park,New Delhi

The resolutions were (including special resolution) passed on show of hands with requisite majority. The venue of theGeneral Meeting of the Company has been chosen for its location, prominence, and capacity.

Postal Ballots

No Special Resolution was required to be put through a Postal Ballot during last financial year

16

STOCK PERFORMANCE

Market price data: The monthly high and low stock quotations during the last financial year at the Bombay StockExchange and performance in comparison to BSE Sensex are given below:

Month High Low

Apr-10 34.15 28.30

May-10 30.90 25.80

Jun-10 28.25 24.50

Jul-10 31.80 25.50

Aug-10 47.05 30.90

Sep-10 47.65 41.00

Oct-10 46.25 41.50

Nov-10 51.50 36.00

Dec-10 43.10 33.60

Jan-11 42.40 33.80

Feb-11 40.00 27.00

Mar-11 32.80 27.80

STOCK CODE

The stock code of the Company at BSE : 500414

ISIN allotted by National Securities Depository Limited andCentral Depositories Securities Limited for Equity Shares : INE064A01026

The Company’s shares are covered under the compulsory dematerialization list and are transferable through the depositorysystem. Share received for physical transfers are registered within a maximum period of two weeks from the date of receipt, ifthe documents are clear in all respects.

As on 31 March 2011, the distribution of Company’s shareholding was as follows: -

No. of Shares No. of Share % of Share Share Amount % of Amountholders holders

UPTO - 2500 54520 97.999 11926437 11.814

2501 - 5000 565 1.016 2205422 2.185

5001 - 10000 304 0.546 2339922 2.318

10001 - 20000 125 0.225 1940224 1.922

20001 - 30000 51 0.092 1278364 1.266

30001 - 40000 17 0.031 611984 0.606

40001 - 50000 18 0.032 866967 0.859

50001 - 100000 17 0.031 1202280 1.191

100001 AND ABOVE 16 0.029 78578400 77.839

TOTAL 55633 100.00 100950000 100.00

34.1530.9

28.2531.8

47.05 47.65 46.25

51.5

43.1 42.440

32.8

18,047.86 17,536.86 17,919.62 18,237.56 18,475.27

20,267.98 20,854.55 21,108.64 20,552.03 20,664.80

18,690.97

19,575.16

0

10

20

30

40

50

60

Apr-10 May-10 Jun-10 Jul-10 Aug-10 Sep-10 Oct-10 Nov-10 Dec-10 Jan-11 Feb-11 Mar-11

0.00

5,000.00

10,000.00

15,000.00

20,000.00

25,000.00

High share price (Rs.) High Sensex

sha

re p

rice

Se

nse

x

Month

17

DEMATERIALISATION OF SHARES

Dematerialization of shares: The Company appointed M/s Alankit Assignments Limited as depository registrar and signedtripartite agreements with NSDL/CDSL to facilitate dematerialization of shares. Shares received for dematerialization aregenerally confirmed within a maximum period of two weeks from the date of receipt, if the documents are clear in all respects.There are 31802 no. of shareholders holding their shares in dematerialized form, which represent 21.96% of the paid upcapital of the Company.

PLANT LOCATION

Timex Group India Limited,

Plot No-10, Baddi, Ind. Area Katha, Near Fire Station Baddi, Nalagarh, Solan, Himachal Pradesh.

Address for correspondence:

Timex Group India Limited, 117, GF, World Trade Centre, Babar Road, New Delhi -110 001

B. NON MANDATORY

REMUNERATION COMMITTEE

The details are given under the heading “Other Sub-Committee of Board of Directors”

CORPORATE POLICY MANUAL

The Timex Group has a Corporate Policy Manual outlining the policies applicable to the Group Companies so that it promotesethical and moral behavior in all its business activities. Employees are free to report a violation of any law, mismanagement,gross waste or misappropriation of funds, a substantial and specific danger to public health and safety, or an abuse ofauthority without fear of retribution or even can request advice when in doubt about the propriety of some action. Employeesalso may, if they wish, make anonymous reports of violations or other irregularities. Employees may also call the complianceline, toll free 24 hours a day. The Corporate Policy Manual is available on Timex group website at below stated link.

http://intranet.timexgroup.com/

The Company also has in place a “Women’s Committee” since 01 October 2003, to take care of cases of sexual harassment inworkplace. This Committee is chaired by a woman running an independent NGO and is assisted by a team of womenemployees.

AUDIT QUALIFICATIONS

During the year under review, there were no audit qualifications in the Company’s financial statements. The Companycontinues to adopt best practices to ensure a regime of unqualified financial statements.

TRAINING OF BOARD MEMBERS:

The Company’s Board of Directors consists of professionals with expertise in the respective fields. They endeavor to keepthemselves updated with the global economic changes and various legislations. They attend various workshops and seminarsto keep themselves abreast with the changing business environment.

18

Chief Executive Officer (CEO) and Chief Financial Officer (CFO)Certification as per Clause 49(V) of the Listing Agreement

The Board of DirectorsTimex Group India LimitedNew Delhi

CERTIFICATION TO THE BOARD PURSUANT TO CLAUSE 49(V) OF THE LISTING AGREEMENTThis is to certify that;a) We have reviewed financial statements and the cash flow statement for the year and that to the best of our knowledge

and belief:

i) these statements do not contain any materially untrue statement or omit any material fact or contain statements thatmight be misleading;

ii) These statements together present a true and fair view of the Company’s affairs and are in compliance with existingaccounting standards, applicable laws and regulations.

(b) There are, to the best of our knowledge and belief, no transactions entered into by the Company during the year whichare fraudulent, illegal or violative of the Company’s code of conduct.

(c ) We accept responsibility for establishing and maintaining internal controls for financial reporting and we have evaluatedthe effectiveness of the internal control systems of the Company pertaining to financial reporting and we have disclosedto the auditors and the Audit Committee, deficiencies in the design or operation of internal controls, if any, of which weare aware and the steps we have taken or propose to take to rectify these deficiencies.

(d) We have indicated to the auditors and Audit Committee;

i) significant changes in internal control during the year over financial reporting during the year;

ii) significant changes in accounting policies during the year and that the same have been disclosed in the notes tothe financial statements; and

iii) Instances of significant fraud of which we have become aware and the involvement therein, if any, of the managementor an employee having a significant role in Company’s internal control system over financial reporting.

V.D.Wadhwa Ananda MukherjeeManaging Director CFO

Dated: 26 May, 2011

DECLARATION BY THE CEO UNDER CLAUSE 49 I (D) OF THE LISTING AGREEMENT REGARDINGADHERENCE TO THE CODE OF CONDUCT

I hereby confirm that:

The Company has obtained from all the members of the Board and Senior Management, Affirmation that they havecomplied with the Code of Conduct in respect of the financial year 2010 -2011.

Sd/-V.D.WadhwaManaging Director

19

CERTIFICATE

To the Members of Timex Group Indian Limited

We have examined the compliances of the conditions of Corporate Governance by Timex Group of India Limited, for thefinancial year ended on 31 March, 2011 as stipulated in Clause 49 of the Listing Agreement of the said Company entered withBombay Stock Exchange.

The Compliances of the conditions of Corporate Governance is the responsibility of the management. Our examination waslimited to procedure and implementation thereof, adopted by the Company for insuring the compliances of the conditions ofCorporate Governance. It is neither an audit nor an expression of opinion on the financial statements of the Company.

In out opinion and to the best of our information and according to the explanations given to us and the representation madeby the Directors and the management, we certify that the Company has complied with the conditions of Corporate Governanceas stipulated in the above mentioned Listing Agreement.

We state that such compliance is neither an assurance as to the future viability of the Company nor the efficency oreffectivness with which the management has conducted the affairs of the Company.

For K. K. MALHOTRA & CO.Company Secretaries

Date : 26 May, 2011 K.K. MALHOTRAPlace : New Delhi C. P. No. : 446

20

Auditors’ ReportTo the Members ofTimex Group India Limited

1. We have audited the attached Balance Sheet of Timex Group India Limited (‘the Company’) as at 31 March 2011, theProfit and Loss Account and the Cash Flow Statement of the Company for the year ended on that date, annexed thereto.These financial statements are the responsibility of the Company’s management. Our responsibility is to express anopinion on these financial statements based on our audit.

2. We conducted our audit in accordance with auditing standards generally accepted in India. Those Standards requirethat we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free ofmaterial misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosuresin the financial statements. An audit also includes assessing the accounting principles used and significant estimatesmade by management, as well as evaluating the overall financial statement presentation. We believe that our auditprovides a reasonable basis for our opinion.

3. As required by the Companies (Auditor’s Report) Order, 2003 (‘the Order’), issued by the Central Government of Indiain terms of sub-section (4A) of Section 227 of the Companies Act, 1956, we enclose in the Annexure a statement on thematters specified in paragraphs 4 and 5 of the said Order.

4. Further to our comments in the Annexure referred to above, we report that:

(a) we have obtained all the information and explanations, which to the best of our knowledge and belief were necessaryfor the purposes of our audit;

(b) in our opinion, proper books of account as required by law have been kept by the Company so far as appears fromour examination of those books;

(c) the Balance Sheet, the Profit and Loss Account and the Cash Flow Statement dealt with by this report are inagreement with the books of account;

(d) in our opinion, the Balance Sheet, the Profit and Loss Account and the Cash Flow Statement dealt with by thisreport comply with the accounting standards referred to in sub-section (3C) of Section 211 of the Companies Act,1956, to the extent applicable;

(e) on the basis of written representations received from the directors as on 31 March 2011, and taken on record by theBoard of Directors, we report that none of the directors is disqualified as on 31 March 2011 from being appointedas a director in terms of clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956, except in respectof one of the directors of the Company, who has since expired, no such representation as on 31 March 2011 hasbeen made available to us in respect of such director. In the absence of such written representation, we areunable to comment whether such director was disqualified from being appointed as director under clause (g) ofsub section (1) of section 274 of the Companies Act, 1956;

(f) in our opinion, and to the best of our information and according to the explanations given to us, the said accountsgive the information required by the Companies Act, 1956, in the manner so required and give a true and fair viewin conformity with the accounting principles generally accepted in India:

(i) in the case of the Balance Sheet, of the state of affairs of the Company as at 31 March 2011;

(ii) in the case of the Profit and Loss Account, of the profit for the year ended on that date; and

(iii) in the case of the Cash Flow Statement, of the cash flows of the Company for the year ended on that date.

For B S R & Co.Chartered AccountantsRegistration No: 101248W

Rakesh DewanPlace: New Delhi PartnerDate: 26 May 2011 Membership No.: 092212

21

Annexure referred to in para 3 of the Auditors’ report to the members of Timex Group India Limited on the financialstatements for the year ended 31 March 2011

(i) (a) The Company has maintained proper records showing full particulars, including quantitative details and situationof fixed assets.

(b) As explained to us, the Company has a regular programme of physical verification of its fixed assets by which allfixed assets are verified in a phased manner over a period of two years. According to this programme, the Companyhas verified certain fixed assets at its factory at Baddi and its corporate office during the year. In our opinion, thisperiodicity of physical verification is reasonable having regard to the size of the Company and the nature of itsassets. As informed to us, no material discrepancies were noticed on such verification. For assets lying with thirdparties at the year-end, written confirmations have been obtained.

(c) In our opinion, and according to information and explanations given to us, the fixed assets disposed off during theyear are not substantial and therefore, do not affect the going concern assumption.

(ii) (a) According to the information and explanations given to us, the inventories, except goods-in-transit and stockslying with third parties, have been physically verified by the management during the year. In our opinion, thefrequency of such verification is reasonable. For stocks lying with third parties at the year-end, written confirmationshave been obtained.

(b) In our opinion and according to the information and explanations given to us, the procedures for the physicalverification of inventories followed by the management are reasonable and adequate in relation to the size of theCompany and the nature of its business.

(c) On the basis of our examination of the records of inventories, we are of the opinion that the Company is maintainingproper records of inventories. As confirmed to us, the discrepancies noticed on physical verification of inventoriesas compared to book records were not material and have been properly dealt with in the books of account.

(iii) According to the information and explanations given to us, the Company has neither granted nor taken any loans,secured or unsecured, to or from companies, firms or other parties covered in the register maintained under section 301of the Companies Act, 1956. Accordingly, paragraphs 4(iii)(b) to (g) of the Order are not applicable.

(iv) In our opinion and according to the information and explanations given to us, and having regard to the explanation thatpurchases of certain items of inventories and fixed assets are for the Company’s specialised requirements and similarlycertain goods and services sold are for the specialised requirements of the buyers and suitable alternative sources arenot available to obtain comparable quotations, there is an adequate internal control system commensurate with the sizeof the Company and the nature of its business with regard to purchase of inventories and fixed assets and with regardto the sale of goods and services. Further, on the basis of our examination and according to the information andexplanations given to us, we have neither come across nor have been informed of any instances of major weaknesses inthe aforesaid internal control system.

(v) (a) In our opinion and according to the information and explanations given to us, the particulars of contracts orarrangements referred to in section 301 of the Companies Act, 1956 have been entered in the register required to bemaintained under that section.

(b) In our opinion, and according to the information and explanations given to us, the transactions made in pursuanceof contracts and arrangements referred to in (a) above and exceeding the value of Rs. 5 lakh are for the specializedrequirements of the Company/buyers for which suitable alternative sources are not available to obtain comparablequotations. However, on the basis of information and explanations provided, the same appears to be reasonable.

(vi) The Company has not accepted any deposits from public during the year.

(vii) In our opinion and according to the information and explanations given to us, the Company has an internal audit systemcommensurate with the size and nature of its business.

22

(viii) We have broadly reviewed the books of account maintained by the Company pursuant to the rules prescribed by theCentral Government for maintenance of cost records under Section 209(1)(d) of the Companies Act, 1956 in respect ofthe products covered and are of the opinion that, prima facie, the prescribed accounts and records have been made andmaintained.However, we have not made a detailed examination of the records with a view to ensure whether they areadequate or complete.

(ix) (a) According to the information and explanations given to us and on the basis of our examination of the records of theCompany, amounts deducted/accrued in the books of account in respect of undisputed statutory dues includingProvident Fund, Employees’ State Insurance, Income tax, Sales-tax, Service tax, Customs duty, Excise duty, InvestorEducation and Protection Fund, Wealth tax and other material statutory dues, as applicable, have generally beenregularly deposited during the year by the Company with the appropriate authorities.

According to the information and explanations given to us, no undisputed amounts payable in respect of ProvidentFund, Employees’ State Insurance, Income tax, Sales tax, Service tax, Customs duty, Excise duty, Investor Educationand Protection Fund, Wealth tax and other material statutory dues, as applicable, were in arrears as at 31 March 2011for a period of more than six months from the date they became payable.

There were no dues on account of cess under section 441A of the Companies Act, 1956 since the date from whichthe aforesaid section comes into force has not yet been notified by the Central Government.

(b) According to the information and explanations given to us, there are no dues in respect of Income-tax, Service taxand Wealth tax which have not been deposited with the appropriate authorities on account of any dispute. Accordingto the information and explanations given to us, the following dues of Sales tax, Custom duty and Excise duty havenot been deposited by the Company on account of disputes:

Name of the Nature of Amounts Amounts paid Period to Forum whereStatute the dues (Rs. thousand) under protest which the dispute

(Rs. Thousand) amount relates is pending

Central Excise Act, 1944 Excise duty 4,253 700 1995-96 to CESTAT,(Cenvat credit) 1998-99 New DelhiPenalty 4,253

Central Excise Act, 1944 Excise duty 1,630 - 1999-2000 to Supreme CourtPenalty 50 2000-01

Central Excise Act, 1944 Excise duty 632 550 1992-93 and Deputy Commissioner,1996-97 Central Excise

Central Sales Tax Sales Tax 5,898 - 1994-95 Deputy CommissionerAct, 1956 – Commercial tax

The Kerala Sales Sales Tax 84 - 1995-96 Assistant CommissionerTax Act,1963 – Sales Tax

Tamil Nadu General Sales Sales Tax 818 - 1992-93 to CommercialTax Act, 1959 1993-94 taxation officer

Andhra Pradesh Sales Sales Tax 44 - 1995-96 CommercialTax Act, 1957 taxation officer

Karnataka Sales Tax Cess 69 - 1995-96 Deputy CommissionerAct, 1957 – Commercial taxes

Tamil Nadu General Sales Sales Tax 941 941 2002-03 High Court, ChennaiTax Act, 1959

Customs Act,1962 Custom duty 779 779 1995-96 Commissioner,Customs (Appeals)

23

In respect of cess, refer to our comment in para (ix) (a).

(x) The Company does not have any accumulated losses at the end of the financial year and has not incurred cash lossesduring the financial year and in the immediately preceding financial year.

(xi) The Company did not have any outstanding due to any financial institution, banks or debenture holders during theyear.

(xii) According to the information and explanations given to us, the Company has not granted any loans and advances onthe basis of security by way of pledge of shares, debentures and other securities.

(xiii) According to the information and explanations given to us, the Company is not a chit fund or a nidhi/ mutual benefitfund/ society.

(xiv) According to the information and explanations given to us, the Company is not dealing or trading in shares, securities,debentures and other investments.

(xv) According to the information and explanations given to us, the Company has not given any guarantees for loanstaken by others from banks or financial institutions.

(xvi) According to the information and explanations given to us, the Company did not have any term loans outstandingduring the year.

(xvii) According to the information and explanations given to us and on an overall examination of the balance sheet of theCompany, we are of the opinion that the funds raised on short-term basis have not been used for long-term investment.

(xviii) The Company has not made any preferential allotment of shares during the year to companies/firms/parties coveredin the register maintained under Section 301 of the Companies Act, 1956.

(xix) The Company did not have any outstanding debentures during the year.

(xx) The Company has not raised any money by way of public issues during the year.

(xxi) According to the information and explanations given to us, no fraud on or by the Company has been noticed orreported during the course of our audit for the year.

For B S R & Co.Chartered AccountantsRegistration No: 101248W

Rakesh DewanPlace: New Delhi PartnerDate: 26 May 2011 Membership No.: 092212

24

BALANCE SHEET

as at 31 March 2011

(Rs. in thousands)

Schedule As at As at31 March 2011 31 March 2010

SOURCES OF FUNDSShareholders’ fundsShare capital 1 511,950 511,950Reserves and surplus 2 198,953 90,842

710,903 602,792

APPLICATION OF FUNDSFixed assets 3Gross block 364,875 346,832Accumulated depreciation (235,398) (219,173)Net block 129,477 127,659Capital work-in-progess 5,474 2,624

134,951 130,283

Current assets, loans and advancesInventories 4 336,588 323,679Sundry debtors 5 774,943 628,092Cash and bank balances 6 122,558 112,038Loans and advances 7 138,203 99,773

1,372,292 1,163,582

Less: Current liabilities and provisions 8Current liabilities (642,169) (579,822)Provisions (154,171) (111,251)Net current assets 575,952 472,509

710,903 602,792

Significant accounting policies 14Notes to the accounts 15

The Schedules referred to above form an integral part of the financial statements.As per our report attached

For B S R & Co. For and on behalf of the BoardChartered AccountantsFirm Registration No: 101248W

Rakesh Dewan Kapil Kapoor V D Wadhwa Ananda MukherjeePartner Chairman Managing Director CFO & Vice PresidentMembership No.: 092212 (Finance & IT)

Place: New DelhiDate: 26 May 2011

25

PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED 31 MARCH 2011(Rs. in thousands)

Schedule Year ended Year ended31 March 2011 31 March 2010

INCOMESales 1,712,636 1,341,051Less: Excise duty (25,193) (20,787)

Net sales 1,687,443 1,320,264Service income 38,255 35,589

Net income from operations 1,725,698 1,355,853Other income 9 13,384 44,856

1,739,082 1,400,709

EXPENDITUREMaterials consumed and movements infinished goods and work-in-progress . 10 931,077 745,113Personnel cost 11 161,769 148,486Other expenses 12 453,502 423,799Depreciation and amortisation 3 16,926 22,881Interest 13 47 1,679

1,563,321 1,341,958

Profit before tax 175,761 58,751

Less: Minimum alternate tax 35,663 12,518

Profit after tax 140,098 46,233Balance brought forward 55,717 41,577

Profit available for appropriation 195,815 87,810Less: Proposed dividend 27,431 27,431Less: Tax on proposed dividend 4,556 4,662

Profit carried forward 163,828 55,717

Basic and diluted earnings per share 1.07 0.14(Refer to note 4 of schedule 15)

Significant accounting policies 14

Notes to the accounts 15

The Schedules referred to above form an integral part of the financial statements.As per our report attached




26

Schedules forming part of the accounts

(Rs. in thousands)

As at As at31 March 2011 31 March 2010

1 . Share capital

Authorised

1,250,000,000 (previous year 1,250,000,000) equity shares of Re. 1 each 1,250,000 1,250,00045,000,000 (previous year 45,000,000) preference shares of Rs. 10 each 450,000 450,000

1,700,000 1,700,000

Issued, subscribed and paid-up

100,950,000 (previous year 100,950,000) equity shares of Re. 1 each, fully paid up. 100,950 100,950Of the above:

- 75,645,100 (previous year 75,645,100) equity shares of Re. 1 each are held byTimex Group Luxury Watches B.V., the holding company.The ultimate holdingcompany is Timex Group B.V.

2,500,000 (previous year 2,500,000), 0.1% non cumulative redeemable non 25,000 25,000convertible preference shares of Rs. 10 each, fully paid up*

15,700,000 (previous year 15,700,000), 7.1% cumulative redeemable non 157,000 157,000convertible preference shares of Rs. 10 each, fully paid up**

22,900,000 (previous year 22,900,000), 7.1% cumulative redeemable non 229,000 229,000convertible preference shares of Rs. 10 each, fully paid up***

511,950 511,950

* Maturity period for redemption of preference shares is ten years from the date of allotment i.e. 25 March 2003, withan option to the Company of an earlier redemption after 24 March 2005.

** Maturity period for redemption of preference shares is ten years from the date of allotment i.e. 27 March 2004, withan option to the Company of an earlier redemption after 27 March 2006. (Refer to note 3 of schedule 15).

*** Maturity period for redemption of preference shares is ten years from the date of allotment i.e. 21 March 2006, withan option to the Company of an earlier redemption after 21 March 2008. (Refer to note 3 of schedule 15).

- All preference shares issued by the Company are held by Timex Group Luxury Watches B.V., the holding company.

2 . Reserves and surplus

Share premium account 35,125 35,125

35,125 35,125

Profit and Loss Account

Opening balance 55,717 41,577Add: Profit for the year before appropriation 140,098 46,233Less: Proposed dividend (27,431) (27,431)Less: Tax on proposed dividend (4,556) (4,662)

163,828 55,717

198,953 90,842

27

3. Fixed assets *

(Rs. in thousands)

Gross block Depreciation/amortisation Net block

Description As at Additions Delet ions As at Upto For the Deletions/ Upto As at As at31 March during during 31 March 31 March year adjustments 31 March 31 March 31 March

2010 the year the year 2011 2010 during the year 2011 2011 2010

Tangible assets

Leasehold land 15,480 - - 15,480 641 165 - 806 14,674 14,839

Buildings 33,402 - - 33,402 3,221 1,115 - 4,336 29,066 30,181

Leasehold improvements 15,474 - - 15,474 14,019 925 - 14,944 530 1,455

Plant and machinery 203,621 3,014 - 206,635 152,346 4,216 - 156,562 50,073 51,275

Office equipment 8,618 967 37 9,548 2,958 347 35 3,270 6,278 5,660

Furniture and fixtures 28,719 12,334 - 41,053 17,344 5,877 - 23,221 17,832 11,375

Computer equipment 38,943 2,432 667 40,708 27,866 3,917 666 31,117 9,591 11,077

Total tangible assets 344,257 18,747 704 362,300 218,395 16,562 701 234,256 128,044 125,862

Intangible assets

Computer software 2,575 - - 2,575 778 364 - 1,142 1,433 1,797

Total intangible assets 2,575 - - 2,575 778 364 - 1,142 1,433 1,797

Grand Total 346,832 18,747 704 364,875 219,173 16,926 701 235,398 129,477 127,659

Previous Year 355,371 9,305 17,844 346,832 209,727 22,881 13,435 219,173 127,659 -

Capital Work in Progress 5,474 2,624

134,951 -

* refer note 4 of schedule 14

(Rs. in thousands)


4 . Inventories

(at the lower of cost and net realisable value)

Raw materials and components [including goods-in-transit Rs.3,788thousand (previous year Rs. 7,845 thousand)] 119,006 113,273

Work-in-progress 11,129 29,324Finished goods [including goods-in-transit Rs. 1,866 thousand(previous year Rs.6,617 thousand)] 206,051 180,662

Stores and consumables 402 420

336,588 323,679

28

(Rs. in thousands)


5 . Sundry debtors *

(Unsecured and considered good, unless otherwise stated)

Debts outstanding for a period exceeding six months

- Considered good 49,905 88,861

- Considered doubtful 32,335 82,240 34,966 123,827

Other debts, considered good ‘ 725,038 539,231

Provision for doubtful debts (32,335) (34,966)

774,943 628,092

* Refer to note 16 of schedule 15.

6 . Cash and bank balances

Cash in hand 846 324

Cheques in hand 28,737 9,022Balances with scheduled banks:- Current accounts 22,820 60,037- Fixed deposit 70,155 42,655

[includes Rs. 155 thousand (previous year Rs. 155 thousand) pledged with bank as security for guarantees issued on behalf of the Company] 122,558 112,038

7 . Loans and advances

Secured, considered good- Vehicle loans to employees* 316 442Unsecured, considered good- Loans and advances to employees** 1,270 933- Advances recoverable in cash or in kind or for value to be received 72,110 52,874- Balances with customs and excise authorities 14,754 12,205- Advance tax 49,753 33,319

138,203 99,773

* Secured by hypothecation of respective vehicles.

** Refer to note 17 of schedule 15.

8 . Current liabilities and provisions

Current liabilities

Sundry creditors

- Total outstanding dues to micro and small enterprises* - -- Others 613,375 565,423Other liabilities 28,794 14,399

642,169 579,822

* Refer to note 2 of schedule 15.

29

Provisions

Gratuity 13,645 8,612Leave encashment 13,025 10,787Warranties** 9,554 12,723Minimum alternate tax 67,507 31,844Fringe benefit tax [net of advance tax of Rs. 22,268 thousand(previous year Rs. 22,268 thousand)] 275 275Proposed dividend 27,431 27,431Tax on proposed dividend 4,556 4,662Sales returns** 18,178 14,917

154,171 111,251

** Refer to note 21 of schedule 15.

9 . Other income

Interest income- on dues from customers 460 969- on deposits with banks (gross) 3,467 635[Tax deducted at source Rs. 345 thousand (previous year Rs. 57 thousand)]Exchange gain (net) 3,275 21,064Liabilities/provisions no longer required written back 973 17,500Gain on sale of fixed assets 13Rental income 930 1,540Miscellaneous income 4,266 3,148

13,384 44,856

10 . Materials consumed and movements in finished goods and work-in-progress *

Raw materials and components consumed * 922,655 787,700Excise duty 25,255 18,939

Less: Excise duty recovered 25,193 62 20,787 (1,848)

Purchase of watches for resale 15,554 12,686Decrease/(increase) in inventories of finished goods and work-in-progress

Opening stock

- Work in progress 29,324 12,095

- Finished goods 180,662 144,466

209,986 156,561

Closing stock

- Work in progress 11,129 29,324

- Finished goods 206,051 180,662

217,180 (7,194) 209,986 (53,425)

931,077 745,113

* Refer to note 11 of Schedule 15

(Rs. in thousands) As at As at

31 March 2011 31 March 2010

(Rs. in thousands)

Year Ended Year Ended31 March 2011 31 March 2010

30

11 . Personnel cost

Salaries, wages and bonus 132,011 126,601

Contribution to provident and other funds 9,991 8,492

Workmen and staff welfare 14,356 12,620

Gratuity 5,411 773

161,769 148,486

12 . Other expenses

Advertising, marketing and brand building expenses 207,615 179,321

Warranty 12,238 19,463

Selling and distribution 41,075 37,386

Power and fuel 5,018 6,077

Repairs and maintenance:

- buildings 2,629 852

- plant and machinery 2,022 1,873

- others 3,027 3,195

Rent 33,684 33,201

Rates and taxes 17,866 13,696

Insurance 2,425 2,073

Travelling 41,265 33,995

Communication 8,734 8,453

Bank charges 1,430 1,516

Legal and professional (Refer note 7 of Schedule 15) 12,750 16,277

Commission 16,914 16,066

Purchased services 19,142 14,687

Provision for doubtful debts - 8,739

Bad debts written off 29 1,673

Less: Provision held (29) - (1,673) -

Advances written off 1,551 -

Loss on sale/retirement of fixed assets - 3,454

Stores and consumables 1,390 764

Miscellaneous expenses * 22,727 22,711

453,502 423,799

* includes director’s sitting fees Rs. 1,040 thousand (previous year Rs.760 thousand).

13 . Interest

Interest on bank overdrafts and short term loans 47 1,679

47 1,679

(Rs. in thousands)

Year ended Year ended31 March 2011 31 March 2010

31

SCHEDULE - 14SIGNIFICANT ACCOUNTING POLICIES

1. Background

Timex Group India Limited (TGIL or the Company), a subsidiary of Timex Group Luxury Watches B.V. (formerly TimexWatches B.V.), is a limited liability Company incorporated on 4 October 1988 under the provisions of the Companies Act,1956. The Company is listed on Bombay Stock Exchange in India.

The Company’s business consists of manufacture and trade of watches and rendering of related after sales service. TheCompany also provides accounting and information and technology support to group companies.

2. Basis of preparation of financial statements

The financial statements are prepared and presented under the historical cost convention, on accrual basis of accountingin accordance with the Generally Accepted Accounting Principles (‘GAAP’) in India and comply with the accountingstandards prescribed by the Companies (Accounting Standards) Rules, 2006 and the presentational requirements of theCompanies Act, 1956, to the extent applicable.

3. Use of estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates andassumptions that affect the reported amounts of assets and liabilities, disclosure of contingent liabilities on the date ofthe financial statements and the reported amounts of revenues and expenses during the reporting period. Examples ofsuch estimates include estimated provision for doubtful debts, warranties, future obligations under employee retirementbenefit plans and estimated useful life of fixed assets. Differences between actual results and estimates are recognisedin the year in which the actual results are known or materialised. Any revision to accounting estimates is recognised inaccordance with the requirements of the respective accounting standard.

4. Fixed assets and depreciation

Fixed assets are carried at cost of acquisition less accumulated depreciation/amortisation. Cost is inclusive of freight,duties, taxes and any other directly attributable costs to bring the assets to their working condition for intended use.

Depreciation on tangible assets other than leasehold land and leasehold improvements is provided under the straightline method over the useful life as estimated by the management or the derived useful life as per Schedule XIV of theCompanies Act, 1956, whichever is lower. Depreciation on the following categories of fixed assets is provided at ratesthat are higher than the corresponding rates prescribed in Schedule XIV:

• Plant and machinery (including office equipment) at rates ranging from 4.75% per annum to 100% per annum basedon technical evaluation.

• Furniture and fixtures at the rate of 20% per annum.

• Tools and moulds are fully depreciated in the year of manufacture / purchase.

Depreciation on additions is provided on a pro-rata basis from the date of acquisition/installation.

Depreciation on sale/deduction from fixed assets is provided for upto the date of sale/adjustment, as the case may be.

Leasehold land is amortised over the period of lease.

Leasehold improvements are depreciated under the straight line method over the lowest of the following:

(i) period of the lease

(ii) useful life as estimated by management

(iii) derived useful life as per Schedule XIV.

Intangible assets are amortised over their estimated useful life of 5 years.

Assets costing upto Rs. 5,000 are fully depreciated in the year of purchase.

During the previous year, the Company had revised its estimate of residual values of certain items of office equipment,leasehold improvement, IT equipment and furniture and fixture and had provided accelerated depreciation thereonamounting to Rs. 3,230 thousand.

32

5. Impairment

The carrying amounts of assets are reviewed at each balance sheet date in accordance with Accounting Standard – 28on ‘Impairment of Assets’ to determine whether there is any indication of impairment. If any such indication exists, therecoverable amount of the asset is estimated. An impairment loss is recognised whenever the carrying amount of anasset or cash generating unit exceeds its recoverable amount. Impairment losses are recognised in the profit and lossaccount. An impairment loss is reversed if there has been a change in the estimates used to determine the recoverableamount. An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carryingamount that would have been determined net of depreciation or amortisation, if no impairment loss had been recognised.

6. Inventories

Inventories are valued at the lower of cost and net realisable value. Cost of inventories includes all costs incurred inbringing the inventories to their present location and condition.

In determining the cost, the weighted average cost method is used. Fixed production overheads are allocated on thebasis of normal capacity of production facilities. Finished goods and work-in-progress include appropriate share ofallocable overheads.

Finished goods held for the purpose of demonstration are amortised over a period of three years after deductingresidual value.

7. Employee benefits

The Company’s obligations towards various employee benefits have been recognised as follows:

Short term benefit

All employee benefits payable/available within twelve months of rendering the service are classified as short-termemployee benefits. Benefits such as salaries, wages and bonus etc., are recognised in the profit and loss account in theperiod in which the employee renders the related service.

Post employment benefits

In respect of the defined contribution plan in the form of Superannuation, the Trustees of the Scheme have entrustedthe administration of the Scheme to the Life Insurance Corporation of India (LIC). Annual contribution to the LIC isrecognised as an expense in the profit and loss account.

Charge for the year in respect of unfunded defined benefit plan in the form of gratuity has been ascertained based onactuarial valuation at the year end using the Projected Unit Credit Method, which recognises each period of service asgiving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the finalobligation. The obligation is measured at the present value of the estimated future cash flows. The discount rate usedfor determining the present value of the obligation under defined benefit plans, is based on the market yields onGovernment securities as at the valuation date having maturity periods approximating to the terms of related obligations.Actuarial gains and losses are recognised immediately in the profit and loss account.

Provident Fund (PF): In respect of certain employees, the Company deposits contribution with the Regional ProvidentFund Commissioner and will have no obligation to pay further amounts. Accordingly, this plan is considered as adefined contribution plan.

For other employees, the Company contributes to the PF Trust which is administered by trustees of an independentlyconstituted Trust recognised by the Income-tax Act, 1961. Contributions, including shortfall, if any, to the Trust arecharged to the profit and loss account on an accrual basis. As the provident fund scheme has a guaranteed return linkedwith that under EPF Scheme, 1952, the same has been considered as a defined benefit plan.

Gains or losses on the curtailment or settlement of any defined benefit plan are recognised when the curtailment orsettlement occurs.

Other long term benefits

Compensated absences are in the nature of other long term employee benefits. Cost of long term benefit by way ofaccumulating compensated absences that are expected to be availed after a period of 12 months from the year end arerecognised when the employees render the service that increases their entitlement to future compensated absences.

33

The liability in respect of compensated absences is provided on the basis of an actuarial valuation done by an independentactuary at the year end. Actuarial gains and losses are recognized immediately in the Profit and Loss Account.

8. Revenue recognition

Revenue from sale of goods is recognised on delivery of goods to the buyer which coincides with transfer of allsignificant risks and rewards of ownership. The amount recognised as sale is inclusive of excise duty and excludes salestax and trade and quantity discounts.

Revenue from services is recognised on rendering of services to customers on accrual basis.

Interest income is recognised on a time proportion basis.

9. Foreign currency transactions

Foreign exchange transactions are recorded using the exchange rate prevailing on the date of the transaction. Exchangedifferences arising on foreign exchange transactions settled during the year are recognised in the Profit and LossAccount of the year.

Monetary assets and liabilities denominated in foreign currencies remaining unsettled as at the balance sheet date are translatedat the exchange rates on that date and the resultant exchange differences are recognised in the Profit and Loss Account.

10. Warranties

Warranty costs are estimated by the management on the basis of past experience. Provision is made for the estimatedliability in respect of warranty costs in the year of sale of goods.

11. Taxation

Income tax expense comprises current tax/fringe benefit tax (that is amount of tax for the year determined in accordancewith the Income-tax Act, 1961) and deferred tax charge or credit (reflecting the tax effects of timing difference betweenaccounting income and taxable income for the period). The deferred tax charge or credit and the corresponding deferredtax liability or deferred tax asset is recognised using the tax rates that have been enacted or substantially enacted as atthe balance sheet date. Deferred tax assets are recognised only to the extent there is reasonable certainty of realisation.Such assets are reviewed at each balance sheet date to reassess realisation. However, where there are carried forwardlosses or unabsorbed depreciation under taxation laws, deferred tax assets are recognised only if there is virtualcertainty of realisation of such assets.

The credits arising from Minimum Alternate Tax paid are recognised as receivable only if there is reasonable certaintythat the Company will have sufficient taxable income in future years in order to utilize such credits.

12. Leases

Lease rentals in respect of assets taken on operating lease are charged on a straight-line basis to the Profit and Loss Account.

Lease income from operating leases is recognised in the Profit and Loss Account on a straight line basis over the lease term.

13. Other Provisions and Contingent Liabilities

A provision arising from claims, litigation, assessment, fines, penalties, etc. is recognised when the Company has apresent obligation as a result of a past event and it is probable that an outflow of resources embodying economicbenefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation.These are reviewed at each balance sheet date and adjusted to reflect current management estimates. Contingentliabilities are disclosed in respect of possible obligations that have risen from past events and the existence of which willbe confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within thecontrol of the enterprise. When there is a possible obligation or present obligation where the likelihood of an outflowis remote, no disclosure or provision is made.

Provision for sales returns is recognised to the extent of estimated margin on expected returns based on past trends.

14. Earnings per share

Basic earnings per share are computed using the weighted average number of equity shares outstanding during theyear. Diluted earnings per share are computed using the weighted average number of equity and dilutive potentialequity shares outstanding during the year, except where the results would be anti-dilutive.

34

SCHEDULE - 15NOTES TO THE ACCOUNTS

1. (a) Capital commitments (Rs. in thousands)

Particulars As at As at31 March 2011 31 March 2010

Estimated amount of contracts remaining to be executed on capitalaccount and not provided for (net of advances) 479 781

(b) Contingent liabilities (Rs. in thousands)


Claims against the Company not acknowledged as debts

a) Sales tax 7,854 7,854b) Excise duty 9,188 9,188c) Customs duty 779 779d) Income tax 6,676 6,676e) Others* 12,788 12,081Bills discounted 45,663 38,719

*During the previous years, the Company had received a notice from the relevant Government authorities for nonpayment of stamp duty on a lease entered into by the Company. However, the demand order has not been received bythe Company and the liability on this account cannot be ascertained.

2. Based on the information presently available with the management, there are no dues outstanding to micro and smallenterprises covered under the Micro, Small and Medium Enterprises Development Act, 2006 as at 31 March 2011(previous year Rs. Nil).

3. The dividend liability on 15,700,000 2.9% cumulative redeemable non-convertible preference shares of Rs.10 each and22,900,000 5.4% cumulative redeemable non-convertible preference shares of Rs. 10 each, payable until 31 March 2009was waived off as per the consent of the holders of these preference shares vide their letter dated 15 March 2009. Thecoupon rate applicable to these series of preference shares was revised to 7.1% effective 1 April 2010 till the date ofmaturity.

4. Earnings per share

The computation of basic/diluted earnings per share is set out below:

Particulars Year ended Year ended 31 March 2011 31 March 2010

Profit as per profit and loss account (Rs. in thousands) 140,098 46,233

Less: Preference dividend and tax thereon (Rs. in thousands) 31,987 32,093

Net Profit attributable to equity shareholders (Rs. in thousands) – (A) 108,111 14,140Basic/weighted average no of equity shares outstanding during the year – (No. in thousands.) – (B) 100,950 100,950

Nominal value of equity shares (Rs) 1.00 1.00

Basic /diluted Earnings per share (Rs.) – (A)/(B) 1.07 0.14

35

5. Managerial Remuneration * (Rs. in thousands)

Particulars Year ended Year ended31 March 2011 31 March 2010

Salaries and other allowances 9,499 4,815

Contribution to Provident and other funds 883 648

Perquisites 1,320 720

Sitting fees 1,040 760

Total 12,742 6,943

* Does not include expenses towards gratuity and leave encashment since the same are based on actuarial valuationcarried out for the Company as a whole.

6. Related parties

a. Related parties and nature of related party relationship where control exists:

Description of Relationship Name of the Party

Ultimate Holding Company Timex Group B.V.Holding Company Timex Group Luxury Watches B.V (formerly Timex

Watches B.V)

b. Other related parties with whom transactions have taken place:

Description of Relationship Name of the Party

Fellow Subsidiaries Timex Group B.V. T/A Mersey ManufacturersFralsen Horlogerie S.A

TMX Limited NV TMX Limited NV (International Sales Division) Timex Corporation (Germany) Timex Corporation (Middlebury) Opex S.A. Timex Limited NV

Timex Group UK Timex Nederland B.V. Timex Group USA Inc.

Timex Group Luxury Watches B.V.(Ferragamo) Tiempo, S.A. de. C.V

Timex Group Precision Engineering Limited (TGPEL)Timex Hong Kong LimitedTimex Do Brasil Comercio E Industria Ltd.Timex PortugalTimex Hungary LimitedVerstime S.A.

Key Management Personnel Gopalratnam Kannan (upto 28 April 2010)V.D. Wadhwa (w.e.f 29 April 2010)

36

c. Transactions and outstanding balances with related parties

(Rs. in thousands)

Party Name IT Purchase of Reimbursement Service Service Sale of Payable Receivable

Support Goods Paid Received Income charges goods

expenses Paid

Ultimate holding companyTimex Group B.V - - - 155 12,319 - - - 12,194

- - - - 162 - - - 6,284

Holding company

Timex Group Luxury 40 - - - - - - 40 -Watches B.V. - - - - - - - - 1,181

Fellow subsidiaries

Timex Group USA INC. - - - - - - - - -- 2,600 - - - - - 472 -

Timex Group B.V. T/A 13,280 - 908 - - - 5,034 868Mersey Manufacturers 1,029 - 19 - - - 28 18

TIMEX CORPORATION 1,825 16,601 35 3,203 13,778 - - 35,710 3,827(MIDDLEBURY) 6,065 478 - 176 23,987 - - 17,316 71,551

TMX LIMITED NV 119,205 336 - - - - 296,336 9149,258 326 155 - - - 218,346 6,846

TIMEX NEDERLAND B.V. - - - - - 837 - 2,442 -- - - - - - - 1,621 -

TIMEX GROUP UK - 4 142 - - - - - -- 80 - - - - - 13 -

Timex Group Luxury - 5,334 6 - - - 1,393 1,803 1,507Watches B.V.( Ferragamo) - 2,871 - - - - - 98 -

TMX Limited NV - - - - - - 4,907 - -(International Sales Division) - 7 573 - - - 2,831 550 5,348

Timex Group Precision - 3054 - - 10,068 - - 29 -Engineering Limited - 2,339 4,107 - 9,782 - - 5 -

Timex Hong Kong Limited - - - - - - - - 705- - - - - - - - 705

Others - 10,514 - - - - - 2,162 39274 - - - - - 1,974 70

Current year figures are in bold.Besides the above, the Company has paid Rs. 27,431 thousand (previous year Rs. Nil) to Timex Group Luxury Watches B.V.as dividend during the year.

(Rs. in thousands)

Transactions with key management personnel: Year ended Year ended31 March 2011 31 March 2010

Remuneration: (refer note 5)Gopalratnam Kannan 3,390 6,183V. D Wadhwa 8,312 -

Advances given:Gopalratnam Kannan - 178V. D Wadhwa 153 -

Amount receivable:V. D Wadhwa 153 -

37

Note:Timex Group Luxury Watches BV, the holding company, has provided a standby letter of credit amounting to Rs. 178,000thousand (previous year Rs. 178,000 thousand) to the bankers of the Company as a guarantee for use of cash credit andoverdraft facilities.

7. Payment to auditors (including service tax):

(Rs. in thousands)

Particulars Year ended Year ended31 March 2010

(a) Statutory audit 1,655 1,655(b) Tax audit 193 193(c) Limited review 1,710 1,741(d) Other services 745 727(e) Reimbursement of out of pocket expenses 240 160

Total 4,543 4,476

8. Capacity and production

Class of goods Unit of Quantity Year ended Year ended 31 March 2011 31 March 2010

Installed Actual Installed Actualcapacity ** production @ capacity ** production @

Watches * Nos. (thousand) 2,400 2,031 2,400 1,661

* includes production at Baddi in Himachal Pradesh.** Installed capacities are as certified by management and have not been verified by the auditors, being a technical

matter. @ includes 86 thousand (previous year 163 thousand) watches valued at Rs. 119,061 thousand (previous year Rs.

117,605 thousand) on account of watches received at Company’s factory at Baddi for repackaging which areliable for excise duty.

9. Details of sales

Class of goods Unit of Quantity Year ended Year ended31 March 2011 31 March 2010

Quantity Value Quantity Value Rs. thousands * Rs. thousands *

Watches Nos. 2,092 1,645,735 1,632 1,282,081(thousand)

Components and others 66,901 58,970

1,712,636 1,341,051

* Values are inclusive of excise duty

10. Details of inventories of finished and traded goods

Class of goods Unit of Quantity As at As at 31 March 2011 31 March 2010

Quantity Value Quantity Value Rs. thousands Rs. thousands

Watches Nos. (thousand) 281 206,051 338 180,662

206,051 180,662

31 March 2011

38

11. Details of raw materials and components consumed

Class of goods Unit of quantity Year ended Year ended31 March 2011 31 March 2010

Quantity Value Quantity Value(Rs. thousands) (Rs. thousands)

Movements Nos. (thousand) 2,196 192,705 1,510 157,003Straps Nos. (thousand) 2,195 200,020 1,508 145,740Other materials * 529,930 484,957

922,655 787,700

* No individual items account for 10 per cent or more of the total value of the raw material consumed. Its impracticableto provide quantitative information in view of varying items diverse in size and nature.

12. Details of purchases of trading goods

Class of goods Unit of quantity Year ended Year ended31 March 2011 31 March 2010

Quantity Value Quantity Value(Rs. thousands) (Rs. thousands)

Watches Nos. (thousands) 4 15,554 6 12,686

15,554 12,686

13. Details of imported and indigenous raw materials, components, spares and consumables consumed


Value % of total Value % of total (Rs. thousands) consumption (Rs. thousands) consumption

Raw materials and componentsImported 452,252 49.02 392,390 49.81Indigenous 470,403 50.98 395,310 50.19

Total 922,655 100.00 787,700 100.00

Stores and consumablesImported 45 3.24 11 1.44Indigenous 1,345 96.76 753 98.56

Total 1,390 100.00 764 100.00

14. Value of imports on CIF basis (Rs. in thousands) Particulars Year ended Year ended

31 March 2011 31 March 2010Components and spares 309,438 311,746Purchase of watches 83,149 83,514Consumables 36 9Total 392,623 395,269

15. Expenditure and earnings in foreign currencya. Expenditure in foreign currency (on accrual basis) (Rs. in thousands)


Traveling 1,724 1,385Software license fees 1,864 6,065Sales and marketing 3,126 1,799Others 519 -

7,233 9,249

39

b. Earnings in foreign currency (on accrual basis)

(Rs. in thousands)


Exports on F.O.B basis 52,711 47,382Service income 26,097 24,149

78,808 71,531

16. Sundry debtors include the following, which are due from bodies corporate under the same management, as definedunder Section 370 (1B) of the Companies Act, 1956.

(Rs. in thousands)

Particulars As at As at31 March 2011 31 Mar 2010

Timex Group, B.V. 12,194 6,284Timex Group Luxury Watches B. V. - 1,181Timex Deutschland G.M.B.H - 9Timex Do Brasil Comercio E Industria Ltd. 7 7Timex Hong Kong Limited 705 705Timex Corporation (Middlebury) 3,827 71,551TMX Limited NV 9 6,846Timex Hungary Limited 22 22TMX Limited NV (International Sales Division) - 5,348Tiempo, S.A. de C.V. - 32Timex Group B.V T/A Mercey Manufacturers 868 18Timex Group Luxury Watches B.V (Ferragamo) 1,507 -Timex Portugal 10 -

17. Loans and advances include dues from Managing Director of the Company Rs. 153 thousand (previous year Rs. Nil).The maximum amount outstanding during the year was Rs. 153 thousand (previous year Rs. 178 thousand).

18. Taxation

The Company has significant carried forward tax losses and unabsorbed depreciation. In view of the absence of virtualcertainty of realisation of carried forward tax losses and unabsorbed depreciation allowance, deferred tax assets arerecognised only to the extent of deferred tax liabilities.

The major components of deferred tax assets and liabilities are as follows:(Rs. in thousands)


Deferred tax liabilitiesDepreciation 5,546 10,930Total deferred tax liability 5,546 10,930Deferred tax assetsGratuity 4,427 2,861Leave encashment 4,226 3,583Provision for doubtful debts 10,491 11,616Provision for warranty 3,100 4,227Provision for sales returns 5,898 4,995Disallowance under section 35DD of the Income-tax Act, 1961 - 200Carried forward depreciation 158,314 153,334Carried forward tax losses - 74,152Total deferred tax asset 186,456 254,968Deferred tax asset recognised (to the extent of deferred tax liability above) 5,546 10,930Net deferred tax asset/ (liability) Nil Nil

40

19. The Company has taken land and building, office premises, showrooms, other business premises and residentialaccommodation for some of its employees under operating lease arrangements, with an option of renewal at the end ofthe lease term and escalation clause in some of the cases. Lease payments charged during the year to the profit and lossaccount aggregate Rs. 29,638 thousand (previous year Rs. 30,450 thousand). The future minimum lease payments undernon-cancellable operating leases are as follows:

(Rs. in thousands)Future lease payments due As at As at

31 March 2011 31 March 2010Within one year 22,417 24,371Later than one year and not later than five years 25,573 44,899

Total 47,990 69,270

20. The Company has given certain items of plant and machinery on operating lease, with an option of renewal at the endof the lease term. However, the lease agreements entered into with the lessees do not provide for any escalation. Leaserentals recognised during the year in the profit and loss account amount to Rs. 930 thousands (previous year Rs. 1,540thousand). The future lease payments receivable under non-cancellable operating leases are as follows:

(Rs. in thousands)Future lease payments receivable As at As at

31 March 2011 31 March 2010Within one year 480 780Later than one year and not later than five years 400 869Total 880 1,649

The gross block, accumulated depreciation and depreciation charge for the year on plant and machinery given underoperating lease arrangements are as under:

(Rs. in thousands)Particulars As at As at

31 March 2011 31 March 2010Gross block 85,327 85,327Accumulated depreciation 70,370 67,902Depreciation charge for the year 2,468 3,184

21. a) Provision for warranties has been recognised for expected warranty claims on products sold during the year. Theprovision has been created based on estimates and past trend. Following is the movement of the provision duringthe year:

(Rs. in thousands)Particulars Year ended Year ended

31 March 2011 31 March 2010Opening provision 12,723 4,698Add: Provision created during the year 12,238 19,463Less: Utilised during the year (15,407) (11,438)

Closing provision 9.554 12,723

b) Provision for sales return has been created for estimated loss of margin on expected sales returns in future periodagainst products sold during the year. The provision has been created based on management’s estimates and pasttrends.Following is the movement in the provision during the year:

(Rs. in thousands)Particulars Year ended Year ended

31 March 2011 31 March 2011Opening provision 14,917 14,833Add: Provision created during the year 4,210 3,678Less: Utilised during the year (949) (3,594)

Closing provision 18,178 14,917

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22. Segment information

The Company’s business segment comprises:

- Watches : Manufacturing and trading of watches;

- Timex Global Services : Providing IT and finance related back office support to other group companies.

Segment revenue in the geographical segments considered for disclosure are as follows:

- Revenues within India (Domestic) include sale of watches and spares to consumers located within India; and

- Revenues outside India (Overseas) include sale of watches manufactured in India and service income earned fromcustomers located outside India.

Segments have been identified in line with the Accounting Standard 17 on “Segment Reporting” notified by the Companies(Accounting Standards) Rules, 2006, taking into account the nature of products and services, the risks and returns, theorganisation structure and the internal financial reporting system.

Secondary segment reporting is performed on the basis of the geographical segments.

Primary segment reporting (by business segment):

(Rs. in thousands)

Watches Others Total2010-11 2009-10 2010-11 2009-10 2010-11 2009-10

Segment revenues External sales (gross) 1,724,794 1,352,492 26,097 24,148 1,750,891 1,376,640Excise duty (25,193) (20,787) - - (25,193) (20,787)External sales (net) 1,699,601 1,331,705 26,097 24,149 1,725,698 1,355,854Other business related income 6,182 22,188 - - 6,182 22,188

Total revenue 1,705,783 1,353,893 26,097 24,149 1,731,880 1,378,042

Results

Segment results 184,484 57,730 1,839 1,683 186,323 59,413Unallocated income 3,275 21,064Unallocated expenses (17,717) (21,651)

Profit before interest and tax 184,482 57,730 1,839 1,683 171,881 58,826

Interest expense (47) (1,679)Interest income 3,927 1,604

Profit before tax 184,482 57,730 1,839 1,683 175,761 58,751

Income taxes - Minimum alternate tax 35,663 12,518

Net profit 140,098 46,233

Other information

Assets

Segment assets 1,309,063 1,055,969 14,176 80,499 1,323,239 1,136,468Unallocated corporate assets 184,004 157,397Total assets 1,507,243 1,293,865

Liabilities

Segment liabilities 695,288 625,449 1,283 1,412 696,571 626,861

Unallocated corporate liabilities - - - - 99,769 64,212Share capital (including sharepremium amount and balancein profit and loss account) - - - - 710,903 602,792

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Watches Others Total2010-11 2009-10 2010-11 2009-10 2010-11 2009-10

Total liabilities 1,507,243 1,293,865Others

Capital expenditure 18,759 5,426 - - 18,759 5,426Unallocated capital expenditure - - - - 2,838 3,879

Total capital expenditure 21,597 9,305

Depreciation 12,890 18,835 556 1,005 13,446 19,840

Unallocated depreciation - - - - 3,480 3,041

Total depreciation 16,926 22,881

Secondary segment reporting (by geographical location of customer):

(Rs. in thousands)

India Outside India Total

2010-11 2009-10 2010-11 2009-10 2010-11 2009-10

Segment revenue 1,653,785 1,302,013 78,095 76,029 1,731,880 1,378,042

Segment assets 1,479,594 1,197,779 27,649 96,086 1,507,243 1,293,865

Capital expenditure 21,597 9,305 - - 21,597 9,305

Segment accounting policies

Besides the normal accounting policies followed as described in Schedule 14, segment revenues, results, assets andliabilities include the respective amounts directly identified to each of the segments and amounts allocated on a reasonablebasis. The description of segment assets and liabilities and the accounting policies in relation to segment accountingare as under:

a) Segment assets and liabilities

Segment assets include all operating assets used by a segment and consist principally of fixed assets, capital workin progress, current assets and loans and advances. Segment liabilities include all operating liabilities in respect ofa segment and consist principally of creditors and accrued liabilities. Segment liabilities do not include sharecapital, reserves, current tax and deferred tax liability. Segment assets do not include advance tax, deferred tax assetand fixed deposits.

b) Segment revenue and expenses

Segment revenue and expenses are directly attributable to the segment and have been allocated to various segmentson the basis of specific identification. However, segment revenue and expenses do not include interest and otherincome/expense in respect of non segmental activities.

23. Employee benefits

(i) The amount recognised as an expense for defined contribution plans is Rs. 4,150 thousand (previous year Rs. 3,220thousand).

(ii) The details of employee benefits with regard to provision/ charge for the year on account of gratuity, which is in thenature of an unfunded defined benefit are as under:

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(Rs. in thousands)

Particulars 2010-11 2009-10

Change in defined benefit obligations during the year

Present value of obligation at beginning of the year 8,612 7,901Service cost 1,268 1,309Interest cost 811 720Actuarial (gain)/loss 222 (1,178)Past Service Cost 3,110 -Benefit paid (378) (140)Present value of obligation at end of the year 13,645 8,612

Present value of unfunded obligation and liability recognised in Balance Sheet

Present value of defined benefit obligation as at the end of the year and liabilityrecognised in the Balance Sheet 13,645 8,612

Gratuity cost recognised in the profit and loss account for the year

Current service cost 1,268 1,309Interest cost 811 720Actuarial (gain)/loss 222 (1,178)Past service costs 3,110 -

Net gratuity cost 5,411 851

Assumptions

Discount rate- For Timex Global Services 8.30% 8.30%- Others 8.30% 8.30%Expected rate of salary increase- For Timex Global Services 10% 10%- Others 8% 8%

The estimates of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotionsand other relevant factors. Discount rate is based on market yields prevailing on government securities for the estimated termof the obligations.

Demographic assumptions:

Particulars Assumptions as at Assumptions as at 31 March 2011 31 March 2010

Retirement age 58 years 58 yearsMortality table LIC (1994-96) LIC (1994-96)

Experience Adjustments

Particulars 31 March 31 March 31 March 31 March 31 March 2007 2008 2009 2010 2011

Defined Benefit obligation atthe end of the year 7,570 7,108 7,901 8,612 13,645

Experience adjustments onplan liabilities (23) (690) 585 (1,177) 222

The guidance on implementing AS-15 issued by Accounting Standards Board (ASB) of the Institute of CharteredAccountants of India states that benefit involving employer established provident funds, which require interest shortfallsto be recompensed are to be considered as defined benefits plans. Pending the issuance of the guidance note from

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Actuarial Society of India, the Company’s actuary has expressed its inability to reliably measure provident fund liabilities.Accordingly, the related information has not been disclosed. The amount contributed by the Company during the yearin respect of such plan is Rs. 5,841 thousand (previous year Rs. 5,272 thousand)

Other long term benefits:

The amount recognised in the profit and loss account in respect of compensated absences is Rs. 4,034 thousand(previous year Rs 2,365 thousand).

24. The Company’s foreign currency exposure on account of payables/ receivables not hedged is as follows:

(Amounts in thousands)

Particulars As at As At31 March 2011 31 March 2010

(in original (in Rupees) (in original (in Rupees)currency) currency)

Payables- USD 7,730 347,444 5,402 244,540- GBP - - 0.2 13- Euro 23 1,447 20 1,254- HKD 739 4,343 1,272 7,571- CHF 37 1,803 2 98

Receivables

- USD 603 26,531 - -

- CHF 32 1,507 2,097 92,397

25. Amount remitted during the year ended 31 March 2011 in foreign currency on account of dividend was Rs. 27,431thousand (previous year Rs Nil).

Non Resident Shareholders Number of shares on which Year to which dividends(numbers) dividend was due relates

One 41,100,000 2009-2010

26. The Company has established a comprehensive system of maintenance of information and documents as required bythe transfer pricing regulation under sections 92-92F of the Income-Tax Act, 1961. Since the law requires existence ofsuch information and documentation to be contemporaneous in nature, the Company continuously updates itsdocumentation for the international transactions entered into with the associated enterprises during the financial yearand expects such records to be in existence latest by such date as required under law. The management is of the opinionthat its international transactions are at arms length so that the aforesaid legislation will not have any impact on thefinancial statements, particularly on the amount of tax expense and that of provision for taxation.

For and on behalf of the Board of Directors ofTimex Group India Limited

Kapil Kapoor VD Wadhwa Ananda MukherjeeChairman Managing Director CFO & Vice President

(Finance & IT)

Place :New DelhiDate :26 May 2011

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CASH FLOW STATEMENTfor the year ended 31 March 2011

(Rs. in thousands)

Schedule Year ended Year ended31 March 2011 31 March 2010

A. Cash flows from operating activitiesNet profit before tax and exceptional items 175,761 58,751Adjustments for:- Depreciation and amortisation 16,926 22,881- Interest income (3,927) (1,604)- Interest expense 47 1,679- (Gain)/loss on sale/retirement of fixed assets (13) 3,454Operating profit before working capital changes 188,794 85,161Adjustments for:- (Increase)/decrease in sundry debtors (146,851) (25,080)- (Increase)/decrease in loans and advances (22,042) 7,882- (Increase)/decrease in inventories (12,909) (74,993)- Increase/(decrease) in current liabilities and provisions 70,151 133,940Cash generated from operations 77,143 126,910- Income taxes paid (net) (16,089) (11,312)- Fringe benefit tax paid - (288)Net cash from operating activities 61,054 115,310

B. Cash flows from investing activitiesPurchase of fixed assets (22,040) (9,827)Proceeds from sale of fixed assets 16 954Proceeds from sale of business - 9,238Interest received 3,975 1,525Tax on interest received (345) (57)Net cash used in investing activities (18,394) 1,833

C. Cash flows from financing activitiesNet repayment of short-term borrowings - (60,260)Interest paid (47) (1,808)Dividend paid (27,431) -Dividend distribution tax paid (4,662) -Net cash used in financing activities (32,140) (62,068)Net cash flows [increase/(decrease)] during the year (A+B+C) 10,520 55,075Cash and cash equivalents - opening balance 112,038 56,963Cash and cash equivalents - closing balance * 122,558 112,038Significant accounting policies 14Notes to the accounts 15

The above cash flow statement has been prepared under the Indirect method set out in Accounting Standard 3 “Cash Flow Statement”specified in the Companies (Accounting Standard) Rules, 2006.* Of the cash and cash equilavents, an amount of Rs. 155 thousand (previous year Rs. 155 thousand) is pledged with banks as securityfor guarantees issued on behalf of the Company.

As per our report attached




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BALANCESHEET ABSTRACT AND COMPANY’S GENERAL BUSINESS PROFILE

I. Registration detailsRegistration No. 3 3 4 3 4 State Code 5 5

Balance Sheet date 3 1 0 3 1 1Date Month Year

II. Capital raised during the year (Amount in rupees thousands)Public issue Rights issue

N I L N I LBonus issue Private placement

N I L N I LIII. Position of mobilisation and deployment of funds(Amount in rupees thousands)

Total liabilities Total assets1 5 0 7 2 4 3 1 5 0 7 2 4 3

Sources of funds

Paid up capital Reserve & surplus5 1 1 9 5 0 1 9 8 9 5 3

Secured loans Unsecured loansN I L N I L

Application of fundsNet fixed assets* Investments

1 3 4 9 5 1 N I L

** including capital work in progressNet current assets Miscellaneous expenditure

5 7 5 9 5 2 N I L

Accumulated lossesN I L

IV. Performance of Company (Amount in rupees thousands)Turnover Total expenditure

1 7 3 9 0 8 2 1 5 6 3 3 2 1

Profit before tax Profit after tax1 7 5 7 6 1 1 4 0 0 9 8

Earning per share in rupees Dividend rate %1.07 7.1% for cummulative preference share

0.1% for non cummulative preference shareV. Generic names of three principle products/services of the company (as per monetary terms)

Item code No.(ITC Code) 9 1 0 2 1 9

Product description W R I S T W A T C H E S

For Timex Group India Limited

Kapil Kapoor V.D. Wadhwa Ananda MukherjeeChairman Managing Director CFO & Vice President

(Finance & IT)

Place: New DelhiDate : 26 May 2011

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MembersBusiness Reply

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Timex Group India Limited

Name & Joint Name s : ………………………………………………………………………………....................

Address:…………………….........………………………………………………………………………..............…

DPID. : …………………………………………….……………………………………………………….................

Client ID :………………………………………………………………………………………………….................

Folio No.:………………………………………………………………………………………………….................(in case of physical holding)

No.of equity shares held :…………………………………………(the period for which held)

e-mail id for registration under “________________________________”.

Note : In case you hold shares in demat mode, kindly get your email id updated with the depositoryparticipant where you are maintaining the demat account

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Members are requested to send this Business Reply Form to the address given overleaf.

Signature of member(s)

48

To,Legal & Secretarial DepartmentTimex Group India LimitedRegistered Office : 117 Ground Floor,World Trade Centre, Babar Road,New Delhi – 110001.

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