Final Annual Report 2018 PDF

2018
annual report
PROGRESSING
with Localization
IMC’s financial highlights were further improved than previous years and have
observed increased turnover and profitability. IMC has been a major contributor
towards economic progress in our country, with its focus on empowering the local
market for parts. With the launch of two new models this year, the Fortuner and
Hilux REVO, our localization has gone even further. With a constant increase in local
suppliers, IMC has come a long way from just 15 parts suppliers in 1993 to 45 in
2018. Let us share some of the facts with you on our journey to progress as the
theme of our annual report this year.
Corporate Profile
Indus Motor Company Limited (IMC) was incorporated in 1989 as a joint venture
company between certain companies of House of Habib of Pakistan, Toyota Motor
Corporation and Toyota Tsusho Corporation of Japan. The Company manufactures
and markets Toyota brand vehicles in Pakistan. The main product offerings include
several variants of the flagship ‘Corolla’ in the passenger car category, ‘Hilux’ in the
light commercial vehicle segment and the ‘Fortuner’ Sports Utility Vehicle.
The manufacturing facility and offices are located at a 105 acre site in Port Qasim,
Karachi, while the product is delivered to end customers nationwide through a strong
network of 45 independent 3S Dealerships spread across the country.
In its 29 years history since inception, IMC has sold more than 800,000 CBU/CKD
vehicles and has demonstrated impressive growth, in terms of volumetric increase from
a modest beginning of 20 vehicles per day production in 1993 to 268 (with overtime)
units daily at present through the development of human talent embracing the ‘Toyota
Way’ of quality and lean manufacturing.
Over the years, IMC has made large scale investments in enhancing its own capacity
and in meeting customer requirements for new products. Today, Corolla is the largest
selling automotive brand model in Pakistan and it also has the distinction of being # 1
in Toyota’s Asian market.
The Company invests heavily in training its 3,200 plus workforce of team members and
management employees and creating a culture of high performing empowered teams
working seamlessly across processes in search of quality and continuous improvement.
The core values of the Company encourage employees to pursue high standards of
business ethics and safety; communicating candidly by giving bad news first and to
respect people. The bi-annual TMC morale surveys show that employees rate IMC high
on work environment and level of job satisfaction.
The Company has played a major role in the development of the entire value
chain of the local auto industry and is proud to have contributed in poverty
alleviation at the grass root level of nurturing localization that, in turn, has
directly created thousands of job opportunities and transferred technology
to over 45 vendors supplying parts. IMC is also a major tax payer and
significant contributor to the GOP exchequer.
Contents
Vision, Mission and Core Values 08 Operating Highlights 54
Toyota Guiding Principles 14 Financial Summary 55
Toyota Motor Corporation CSR Policy 15 Vertical and Horizontal Analysis 58
Strategic Objectives 16 Statement of Value Addition 60
Board of Directors 18 Chairman’s Review 62
Company Information 46 Directors’ Report 64
Corporate Governance 48 Global Vision for Those We Serve 87
Organization Chart 49 Fun Facts & Tips for Safety 88
Shareholder Information 52
Statement of Compliance with the

Code of Corporate Governance 95
Review Report to the Members 98
Auditor’s Report to the Members 99
Financial Statements 104
Pattern of Shareholding 151
Ten Year Performance Indicators 154
Notice of Annual General Meeting 156
Notice of Annual General Meeting (Urdu) 159
Directors’ Report (Urdu) 180
Chairman’s Review (Urdu) 182
Form of Proxy 183
Form of Proxy (Urdu) 185
Electronic Dividend Mandate From 187
Electronic Dividend Mandate From (Urdu) 188
SAVING Foreign
Exchange
Foreign exchange reserves of the country seem to be standing on a critical
point. Foreign debt burden on the economy is getting wider. In this situation
IMC’s focus is on saving the reserves through localization of different parts.
This contribution has helped in saving millions of dollar outflow from the
economy. Achieving a significant level of localization every year, IMC plays its
role in narrowing the trade deficit gap by procuring parts from local vendors.
Vision
“To be the most respected and successful enterprise,
delighting customers with a wide range of products and
solutions in the automobile industry with the best people
and the best technology.”
Mission
IMC’s Mission is reflected in the Company’s slogan
Action, Commitment and Teamwork to

become # 1 in Pakistan
Respect & Corporate Image
Customer Satisfaction
Production & Sales
Quality & Safety
Best Employer
Profitability
Act #
1
Action,
Commitment,
Teamwork
8
Indus Motor Company Ltd.
Annual Report 2018 9

10
Core Values
• World class production quality
• Achieving the ultimate goal of complete customer satisfaction
• Being seen as the best employer
• Fostering the spirit of teamwork
• Inculcating ethical and honest practices

CREATING
Jobs
Looking forward to the level of localization, the industry is
expanding rapidly. With a growing number of people, coming of
employable age, job creation becomes essential to broad-base
benefits of growth. The progressive growth in the auto sector has
led in the creation of job opportunities and providing livelihood
to millions of households. This has further ensured the fulfillment
of one of the government’s macroeconomic indicators by
reducing unemployment. The increased number of employment
opportunities has also provided the circular flow of money in the
economy.
Toyota
Guiding Principles
Akio Toyoda
President, Toyota Motor Corporation
14
Toyota Motor Corporation

CSR Policy
Contribution Towards Sustainable Development
Preamble Business Partners
We, Toyota Motor Corporation and our subsidiaries, take • We respect our business partners such as suppliers
initiative to contribute to harmonious and sustainable and dealers and work with them through long-term
development of society and the earth through all business relationships to realize mutual growth based on
activities that we carry out in each country and region, mutual trust. (Guiding Principles 7)
based on our Principles. We comply with local, national
and international laws and regulations as well as the • Whenever we seek a new business partner, we
spirit thereof and we conduct our business operations are open to any and all candidates, regardless of
with honesty and integrity. In order to contribute to nationality or size, and evaluate them based on their
sustainable development, we believe that management overall strengths. (Guiding Principles 7)
interacting with its stakeholders as described below is of • We maintain fair and free competition in accordance
considerable importance, and we will endeavor to build with the letter and spirit of each country’s competition
and maintain sound relationships with our stakeholders laws. (Guiding Principles 1 and 7)
through open and fair communication. We expect our
business partners to support this initiative and act in Shareholders
accordance with it.
• We strive to enhance corporate value while achieving
Customers a stable and long-term growth for the benefit of our
shareholders. (Guiding Principles 6)
• Based on our philosophy of “Customer First,” we
develop and provide innovative, safe and outstanding • We provide our shareholders and investors with
high quality products and services that meet a wide timely and fair disclosure on our operating results and
variety of customers’ demands to enrich the lives of financial condition. (Guiding Principles 1 and 6)
people around the world. (Guiding Principles 3 and 4)
Global Society/Local Communities
• We will endeavor to protect the personal information
of customers and everyone else we are engaged in Environment
business with, in accordance with the letter and spirit
of each country’s privacy laws. (Guiding Principles 1) We aim for growth that is in harmony with the environment
by seeking to minimize the environmental impact of
Employees our business operations, such as by working to reduce
the effect of our vehicles and operations on climate
• We respect our employees and believe that the change and biodiversity. We strive to develop, establish
success of our business is led by each individual’s and promote technologies enabling the environment
creativity and good teamwork. We stimulate personal and economy to coexist harmoniously, and to
growth for our employees. (Guiding Principles 5) build close and cooperative relationships with
• We support equal employment opportunities, a wide spectrum of individuals and organizations involved
diversity and inclusion for our employees and do not in environmental preservation. (Guiding Principles 3)
discriminate against them. (Guiding Principles 5)
Community
• We strive to provide fair working conditions and to
maintain a safe and healthy working environment for • We implement our philosophy of “respect for people”
all our employee. (Guiding Principles 5) by honoring the culture, customs, history and laws of
each country. (Guiding Principles 2)
• We respect and honor the human rights of people
involved in our business and, in particular, do not use • We constantly search for safer, cleaner and superior
or tolerate any form of forced or child labor. (Guiding technology that satisfies the evolving needs of society
Principles 5) for sustainable mobility. (Guiding Principles 3 and 4)
• Through communication and dialogue with our • We do not tolerate bribery of or by any business
employees, we build and share the value “Mutual partner, government agency or public authority
Trust and Mutual Responsibility” and work together and maintain honest and fair relationships with
for the success of our employees and the company. government agencies and public authorities. (Guiding
Principles 1)
• We recognize our employees’ right to freely associate,
or not to associate, complying with the laws of the Social contribution
countries in which we operate. (Guiding Principles 5)
• Management of each company takes leadership • Wherever we do business, we actively promote
in fostering a corporate culture, and implementing and engage, both individually and with partners, in
policies, that promote ethical behavior. (Guiding social contribution activities that help strengthen
Principles 1 and 5) communities and contribute to the enrichment of
society. (Guiding Principles 2)

Strategic Objectives
Achieving Market
Bringing Toyota Quality
Leadership by Delivering Optimizing Cost by
Value to Customers Kaizen to Pakistan
• Following our “Customer • Fostering a Kaizen culture • Maximizing QRD (Quality,

First” philosophy in and mindset at IMC, its Reliability and Durability) by
manufacturing and Dealers and Vendors. built-in engineering.
providing high quality • Implementing Toyota • Transferring technology and
vehicles and services Production System. promoting indigenization at
that meet the needs of • Removing waste in all areas IMC and its Vendors.
Pakistani customers. and operating in the lowest • Raising the bar in all support
• Enhancing the quality and cost quartile of the industry. functions to meet Toyota
reach of our 3S Dealership Global Standards.
Network.
• Employing customer
insight and feedback for
continuous corporate
renewal, including product
development, improving
service and customer care.
16
Respecting our people Become a Good Corporate Citizen
• Treating employees as the most • Following ethical business practices

important sustainable competitive and the laws of the land.
resource. • Engaging in philanthropic and social
• Providing a continuous learning activities that contribute to the
environment that promotes enrichment of the Pakistani society,
individual creativity and especially in areas that are strategic
teamwork. to both societal and business
• Supporting equal employment needs e.g. road safety, technical
opportunities, diversity and education, environment protection,
inclusion without discrimination. etc.
• Building competitive value • Enhancing corporate value and
through mutual trust and mutual respect while achieving a stable and
responsibility between the Indus long term growth for the benefit of
Team and the Company. our shareholders.

Board of Directors
Ali S. Habib
Chairman
Ali S. Habib is the Chairman of Indus Motor Company Limited and is also
the Founding Director of the Company. He also serves as a Member on the
Board of Directors of Thal Limited, Shabbir Tiles & Ceramics Limited and
Habib Metropolitan Bank Limited.
He is a graduate in Mechanical Engineering from the University of

Minnesota, USA. He has attended the PMD Program at Harvard University.
Yuji Takarada
Director & Vice Chairman
Yuji Takarada has been appointed as a Director on the Board and Vice
Chairman of Indus Motor Company Limited with effect from January 2018.
He has been serving at Toyota Motor Corporation for over 24 years and has
worked in different capacities. He has also served as Marketing Director for
Toyota Astra Motor (TAM).
He has completed his Bachelor’s degree in Sociology from Hitotsubashi

University in Japan.
Ali Asghar Jamali

Chief Executive
Ali Asghar Jamali was appointed as Chief Executive Officer in January
2017. He has been with the Company since October 2000 and has served
in key roles in various departments, owing to which he has acquired rich
experience in end to end management of company operations.
He is a fellow of the Institute of Chartered Accountants of Pakistan and has

attended the Advance Management Program at Harvard University and
the Accelerated Management Program at Wharton School of Business in
the USA.
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Parvez Ghias
Director
Parvez Ghias served as Chief Executive of the Company from 2005
to 2016. After stepping down as Chief Executive, he has continued as
a Director on the Board. Prior to joining the Company, he was the Vice
President and CFO at Engro Chemical Pakistan Limited and served as
a Member of the Board of Directors. He also serves as an independent
director on the Board of Directors of Dawood Hercules Corporation Limited
and Shell Pakistan Limited.
He is a fellow of the Institute of Chartered Accountants from England &

Wales and holds a Bachelors Degree in Economics and Statistics.
Azam Faruque
Independent Director
Azam Faruque was elected as a Director of the Company in October 2014. He
is a director and CEO of Cherat Cement Co. Limited, a Ghulam Faruque Group
(GFG) company. Apart from the 26 years he has spent in the cement industry
and other GFG businesses, he has served as a member on the Board of various
public and private sector institutions. Currently he is a Non-Executive Director
of Madian Hydro Power Limited, Faruque (Pvt) Limited, Greaves Pakistan (Pvt)
Limited and International Industries Limited. He also serves as an Independent
Director on the Board of Directors of Atlas Battery Limited.
He is an Electrical Engineering and Computer Science graduate from Princeton

University USA, and has also completed his MBA with High Honors from the
University of Chicago.

Board of Directors
Farhad Zulficar
Director
Farhad Zulficar is the Founding Director of Indus Motor Company Limited.
He was the first Managing Director of the Company from 1989 to 2001
and has also served as Director on various listed and private companies.
He is a commerce graduate from the University of Karachi.
Mohamedali R. Habib
Director
Mohamedali R. Habib is the Founding Director of Indus Motor Company
Limited. He has been an Executive Director of Habib Metropolitan Bank Limited
since 2004 and currently serves as the Chairman of the Board of Directors of
the Bank. He also serves as a Member on the Board of Thal Limited and Habib
Insurance Company Limited. He was appointed as Joint-President & Division
Head (Asia) & Member of General Management of Habib Bank AG Zurich in
2011.
He has a graduate degree in Business Management – Finance from Clark

University, USA.
Tetsuya Ezumi
Director
Tetsuya Ezumi was appointed as Director of Indus Motor Company Limited
in May 2018. He has been associated with Toyota Motor Corporation from
1985 to 2017, during which time he has held various senior positions. He
joined Toyota Tsusho Corporation in 2018 and he is presently Executive
Officer of Toyota Tsusho Corporation and has served as director on the
Board of various Toyota Group companies in countries around the globe.
He is a graduate from Faculty of Law of Kagawa University, Japan.
20
Sadatoshi Kashihara
Director
Sadatoshi Kashihara was appointed as Director of Indus Motor Company
Limited in January 2017 and also serves as Senior Director Manufacturing.
He has been with Toyota Group since 1990 and has held various senior
executive positions. He has vast experience in the areas of Production,
Plant Engineering at various Toyota plants in the world.
He is a graduate from the Miyazaki University, Japan.
Susumu Matsuda
Director
Susumu Matsuda was appointed as a Director of Indus Motor Company
Limited in February 2018. Currently he is serving as the President of
Toyota Motor Asia Pacific Pte Ltd and Managing Officer of Toyota Motor
Corporation. He is presently director on the Board of Directors of various
Toyota Group companies in countries around the globe.
He graduated from Kobe University, Japan.

Senior Management
22
TRANSFERING
Technology
Currently, 45 vendors from all over Pakistan are providing more than 150 million
parts every day. This reflects the level of localization that IMC has been able
able to achieve in last 29 years of its journey. This wasn’t possible without the
transfer of technology between two countries, Pakistan and Japan. IMC and
its venders collectively have 35 different technical assistance agreement with
Japanese companies that has helped in moving forward with localization without
compromising on the quality.
Vendor Network
Vendor: Loads Ltd.
CEO: Munir K Bana
Loads Limited was established on January 1, 1979 as a private limited company
with the objective of manufacturing exhaust systems, radiators, and sheet metal
components for the automotive industry. Over the years, the Company has grown
into one of the largest Auto Parts Manufacturers (APMs) in the country and is
recognized for the reliability and quality of its products. It has signed Technical
Assistance Agreements with Yutaba, Fataba, etc. for Exhaust Systems & Sheet
Metal Components (as well as Radiators). Today Loads group ranks amongst the
top ten largest manufacturers of auto parts in Pakistan and is currently the market leader in Exhaust Systems for
the automotive industry.
The primary customers of the company belong to the automotive sector, mainly multi-national assemblers of
passenger cars, light commercial vehicles,
heavy commercial vehicles (trucks & buses),
tractors and motorcycles. The key clientele
of the Group includes world’s most reputable
assemblers including Toyota. Loads Limited
has in-house die designing & manufacturing
facility with state-of-the-art Computer
Numerical Control (“CNC”) automatic die
manufacturing machines. The Japanese
philosophies of 5s and Kaizen have been
implemented to ensure efficiency, good
housekeeping and higher productivity. All senior
personnel undergo training and development
as required from time to time.
As part of its diversification strategy, Loads

Group has taken a decision to expand its product range to include “Aluminium cast Wheels”, which are currently
not manufactured in Pakistan. Recent acquisition of a plant will lead to the addition of Alloy Wheels to its portfolio
by end-2019.
With the continuing growth of the auto industry in Pakistan, Loads group looks forward to sharing and supporting
IMC’s future endeavors for achieving continued growth and prosperity in the auto sector.
26
Vendor: TechnoPak Industries (Pvt.) Ltd.

CEO: Amir Allawala
Tecno Group possesses a track record of more than 4 decades in building
sustainable relationships with our valuable clients by serving them through the
production of automobile components.
Tecno Pack Telecom Pvt Ltd is closely associated with all Japanese car
assemblers in Pakistan. The company is a leading supplier of safety seatbelt, car
audio & infotainment systems and vehicle security products. Tecno is ISO-9002
and ISO-14001 certified and adopts latest management tools to ensure quality & reliability of its components.
Tecno has always gained prestigious guidance and appreciation from its valued customers including large OEMs
such as Indus Motor Company Ltd.
Tecno Group feels optimistic about future growth in

automobile demand in the country based on the rise
in consumer demand and a vibrant young population.
To avail these upcoming opportunities, Tecno Auto
Glass Ltd has been set up with a total investment
of PKR 2.87 billion to produce ECE-R43 compliant
Windscreens, Rear Glasses & Side Glasses. Currently,
the plant is in advance stage of construction and
equipment installation under technical assistance
provided by Asahi Glass. The project is expected to
start commercial production in second quarter of 2019
with total capacity of 500,000 car sets per annum.

Vendor: Procon Engineering (Pvt.) Ltd.
MD: Nadeem Malik
Master Group instituted a manufacturing automotive interior Industry, Procon
Engineering (Pvt.) Ltd. the first of its kind with state-of-the-art self-reliant composite
manufacturing facilities in Karachi and Lahore.
Procon is IATF 16949:2016, ISO 9001:2015 and ISO 14001:2004 certified

company supplies high quality products for car, van, pickup, truck, bus, motorcycle
and tractor manufacturers. Procon has the distinguished honor of exporting
Sports Car Seats to USA, Europe and Japan. Procon has highly advanced Stamping Facility (for sheet metal parts)
with a wide range of Presses ranging between 100 ton to 1300 ton capacity. We got welding facility, including Manual
and Robotic Spot and M.I.G Welding for sheet metal part assemblies. It has an in-house Tool and Die manufacturing
facility for Dies Jigs & Fixtures. It has the capability to fulfill any requirement for automotive interiors and other
components. PROCON also has a dedicated
setup for manufacturing of Automotive Seating
Fabric with technical collaboration of TCH
Suminoe Co., Ltd Thailand. This unit is fully
equipped with all the necessary machinery,
and testing equipment such as Electronic
Dobby Loom, Jacquard Loom, and Circular
Knitting Machine etc. for the manufacturing of
Seating Fabrics.
The relationship between Procon and IMC

dates back to the time when IMC established
its Assembly Plant at Port Qasim in 1992. Ever
since then with every passing year this cordial
relationship has continually grown stronger
and stronger. Both companies have together
stood the test of time and have developed mutual trust, confidence and understanding of the highest level and have
an everlasting relationship. Procon was the first vendor to set up its manufacturing facility in the close vicinity of IMC
which is a testimony of the mutual trust, understanding and confidence between Procon and IMC. We sincerely
hope and wish that this relationship is further strengthened and stays evergreen for all times to come.
28
Vendor: Rubatech Manufacturing Company (Pvt.) Ltd.

CEO: Shariq Sohail
Rubatech Manufacturing Company was incorporated in 1990, and since then
has maintained its edge as specialty rubber and plastic part supplier for industry.
Rubatech is the premier supplier of OEM standard automotive parts. Rubatech
continues to strengthen its industrial capabilities by continual investments and
creating more job opportunities. The company employs a highly trained and
dedicated workforce, with employees, ensuring that our customers receive the
highest quality products on time. Over the past twenty five years the company
has invested in facility expansion, automated production lines, new metal treatment facility, additional testing
equipment, enhancement of production capability. Using in-house R&D and knowledge base, RMC creates the
ideal compounds for our client’s specialized needs. Be it soundproofing, weather sealing, or high temperature oil
sealing applications, RMC can provide a solution that falls under quality and cost standards.
RMC is also a specialist in high performance

rubber-metal bonded components. In addition
to core competencies in rubber technology,
RMC also has considerable strength in plastics,
with manufacturing of trims, door moldings,
window seals and attaching components.
RMC’s plans to enhance its manufacturing

capability by adding technology to manufacture
Glass Runs on the latest engineering
standards, and weather strip outer and inner
components for the automotive industry. We
are proud to say that RMC is ISO9001 and
ISO14001 certified.
The automotive industry is heavily dependent

on economies of scale. New technological investments only yield good results if backed by volumes. RMC hopes
that the economy of Pakistan will continue to grow, and policies should be made to ensure the continued growth of
the automotive industry in Pakistan.

Vendor: Thermosole Industries (Pvt.) Ltd.
Chairman: Syed Nabeel Hashmi
THERMOSOLE INDUSTRIES PVT LTD is a designing and manufacturing unit
producing Engineering Automotive plastic components with supplies to Pakistan
car, motorcycle and Tractor industry. It also produces large scale Industrial
Packaging for Textile, Chemical, Food, pharmaceutical, paint industry and
Gardening and highway safety equipment. Tiger Polymer Corporation Japan is
the counterpart, providing technical assistance to Thermosole industries.
An Engineering Plastics, Custom OEM processor

offering one stop solution services of Plastic product
designing, development and production. We offer
a wide range of flexibility to produce precision
engineering and industrial plastic components
and parts. We are complemented with high quality
in house tool design and development. Currently
we are covering 95% of all OEM Automotive Blow
Molding requirements in Pakistan. We are also proud
Auto parts exporters to Europe & the USA.
Over the last thirty four years the company took

itself on a continuous improvement process with
dedicated innovations and high technology. We
ensure complete customer satisfaction in each
product that we produce and never compromise on
quality. We aim for zero defects with on time delivery.
We have got following certifications for quality, environment, food safety and health and safety management, ISO
9001: 2015, ISO 14000: 2015, FSSC 22000, OHSAS 18001: 2014.
For the last 25 years, Thermosole is part of IMC vendor

network. Thank you IMC for trusting us with challenging
projects and keeping us abreast with the best management
practices that have enabled us to be one of your best
suppliers. IMC’s localization drive is a strong enabler of
employment and technology transfer.
30
Vendor: PCI Automotive (Pvt.) Ltd.

CEO: Syed Mehdi Ali Rizvi
We started our journey in1948, when Syed Ali Akbar Rizvi, set up PCI – Pakistan
Carpet Industry, in the busy local hub of Saddar, Karachi, which contributed to
the economy of the country. In 1951, we established Pakistan’s first handmade
carpet manufacturing unit, dedicated solely for export. Owing the extraordinary
performance of the company in the international market, PCI was awarded
the President’s Export Trophy in 1969. Weaving through success by 1978, we
developed our own needle punched carpet production line. In 1984, we started
our journey as a pioneer in the automotive carpet industry in Pakistan by supplying floor carpets. Since then we have
grown from being an auto-carpet supplier to a manufacturer of parts through Thermoforming, Injection Molding,
Blow Molding, PU Forming, Vacuum Forming and Sheet Metal. Our passion and dedication over the years have been
rewarded. As of today, we are among the top 5 vendors within the automotive industry, serving all major OEMs such
as Indus Motor Compay. PCI Automotive has always focused on meeting or even exceeding OEMs’ expectations
in terms of quality, cost and timely delivery.
We have almost 500 employees working
with us. We have 2 Manufacturing Facilities
to cater OEMs in the most efficient manner.
the Japanese system of management,
such as 5S, Kaizen & QCC has been
implemented throughout the organization.
In order to make its operations environment
friendly, PCI Automotive is also ISO14001
certified.
We take pride in the fact that PCI

Automotive is the first vendor supplier to
join hands with Indus Motor Company.
Since then, IMC’s support and technical
assistance has benefitted us in achieving
significant levels in localizing different parts
that has led to increase job opportunities in Pakistan. We hope that local industry expands and flourishes.

Vendor: Razi Sons (Pvt.) Ltd.
Chairman: Salahuddin Siddiqui
Razi Sons was established in 1948 as Rubber and Leather manufacturer later
it became the first Automotive seat manufacturing unit in Pakistan. In its initial
years, Pakistan faced multiple challenges in every sector of the economy,
and the emerging automotive industry was no exception. Razi sons (Pvt.) Ltd
remained steadfast despite encountering numerous problems, and continued to
enhance its stature and credibility as a quality seat manufacturer in 1973, the
company achieved a proud distinction when its seats were used in Pakistan’s first
assembled passenger car.
With the passage of time, Razi Sons (Pvt.) Ltd has gradually
expanded its product line and, under the astute guidance
of its Chairman Mr. Salahuddin Siddiqui, the company is
now regarded as one of the premier suppliers of auto parts
to OEMs and an integral partner in the development of
Pakistan’s automotive industry. Our range of products also
includes complete interior components and sheet metal
parts.
Today Razi Sons (Pvt.) Ltd has become synonymous with

quality, reliability, competitive prices and timely delivery.
With hard work, constant innovation and commitment, we
endeavor to continue our key role to support and bolster
Pakistan’s automotive industry.
Since the inception, Razi Sons is a part of IMC’s supplier

network under the dynamic Leadership of Mr. Ali S Habib.
Razi Sons has the honor of installing seats in the 1st Corolla
roll out at IMC which was appreciated by Japanese.
The name Razi Sons stands for more than just seat, it
represents philosophy of quality, price and in time delivery.
We look forward to take advantage of our expertise to
flourish local industry in Pakistan.
32
Vendor: Omar Jibran Engineering Industries Ltd.

CEO: Feroz Khan
Omar Jibran Engineering Industries Limited (OJ) was incorporated on the 25th of
June 1987. OJ started the first plant in Karachi on the 1st of July 1990. OJ has the
Injection Molding facility which molds largest plastic parts, e.g. Car Bumpers and
Instrument Panels in Pakistan. The Injection Molding Machines range from 100
Tons to 3000 Tons clamping force. OJ is the first vendor industry in Pakistan who
started manufacturing, car bumpers, instrument panels, radiator grills in 1990.
Over the past 30 years, OJ has been a single source supplier of these parts to
Toyota vehicles being assembled in Pakistan. OJ manufactures approximately 150 plastic injection molded parts.
OJ is an OEM parts supplier to Toyota.
We have vast experience of more than twelve years in making Molds and Dies for Plastic and Sheet metal
components respectively.
OJ is the first vendor in Pakistan to introduce

Gas Injection Molding Technology. For
this purpose, OJ acquired state of the art
equipment from Bauer Germany.
Over the past 30 years, is among few

pioneer vendors to supply parts for Corolla
and feel immense pleasure to inform that
our parts were installed in first Toyota
Corolla line-off in Pakistan. Among the
first part were Door Handles, Bumpers,
instrument Panels. Today, OJ supplies
more than 70 injection molded plastic
parts for Corolla, Hilux and Fortuner, which
include Engine Covers, Liner Fenders, Grill
Radiators, Fog Lamps and etc. We look
forward for the same corporation in the future.

Vendor: Metaline Industries (Pvt.) Ltd.
Chairman: Razzak Ahmed
Metaline established in 1983, with precision machining and press work ability
providing hi-tech equipment and sheet metal components to OEMs as tier one
supplier and other engineering sectors of the country. Through the dedication and
expertise of our work force, our company soon earned reputation for its good
quality and reliable services. Today, at Metaline we provide a wide spectrum of
engineering services of consultancy, designing, development and production
of high quality products. We also produce high quality precision tooling for the
development of intricate dies and molds required for
our quality products and automobile sector to meet the
customers’ expectations for stringent quality. Expansion
of state of the art facilities of Metaline Industries (Pvt) Ltd.
helped to meet our clients challenging demands. At the
same time we also provide valuable in-house resource
for the speedy production of accurate tooling. By adding
CNC wire-cut, EDM, CMM machine to our tool room and
hi-tech paint shop with conveyor system. It has become
possible for us to manufacture and maintain large size of
tooling and high quality paint on our products. This unit,
thus offers all facilities under one roof. We are in a position
to undertake manufacturing of all sizeable components i.e.
fuel tanks, oil pans, body panels and sub-assemblies.
It’s like a family being a part of the IMC supplier network.

IMC has not just developed its in-house parts manufacturing, but has provided complete technical support in
developing the local parts vendors. Metaline started its operations with a workforce of 60 people but due to the
substantial localization in the past years, the number has increased to more than 500. Initially, we were supplying
screw jacks and then fuel tanks for Toyota Corolla. This contribution has led to increase the local value addition. We
look forward to get the same corporation in future as well.
34
Vendor: Synthetic Products Enterprises Ltd.

Chairman: Almas Hyder
Synthetic Products Enterprises Limited is one of the leading manufacturers of
Technology Intensive Engineering Plastic and Packaging Products in Pakistan. For
more than 40 years, SPEL has been delivering quality products and outstanding
services to the industry.
SPEL values Customer Satisfaction, Save Environment, Respect for everyone in

the organization, customers and stakeholders, Integrity and sense of Ownership.
SPEL focuses on new products development and introduction of new and better technologies.
SPEL is ISO 9001, ISO 14001, FSSC22000 & HALAL certified and Sedex Compliance.
SPEL is a part of SPEL Group that provides one stop shopping experience to the customers for engineering
plastic products and molds. We at SPEL
provide complete solutions, from design
to products, which are aesthetically
appealing, precise and meet quality and
environmental standards. SPEL provides
expertise from design to production,
including Rapid Prototyping, Tooling
Development, Inspection, and Material
Selection. SPEL’s capabilities span from
Designing, Molds & Dies Making, Injection
Molding, Thermoforming, Blow Molding,
Extrusion, Printing, Labeling, Shrink
Sleeved Bottles, and Stickering etc.
SPEL works hand in hand with IMC

towards the goal of creating value, generate
employment and save foreign exchange
through localization. SPEL is uniquely positioned to leverage its technology, knowhow and skilled manpower to help
the auto industry meet the mobility needs of the society in years to come. SPEL has been one of the first companies
to become IMC’s vendor and has grown from small to medium sized company with the help of Toyota production
systems, and the help and support of IMCs management and engineers.

Vendor: Alsons Industries (Pvt.) Ltd.
Chairman: Abdul Rehman Allana
Having 60 years of rich manufacturing experience complemented by our
impeccable record of providing innovative engineering technologies and
solutions has enabled Alsons to
manufacture hi-tech specialized
engineering products of enhanced
quality for the Automotive,
Precision Engineering, Alternative
Fuel, Aerospace, Agriculture and Oil and Gas.
Alsons Auto Parts (Pvt.) Ltd. established 1992, is one of the leading
Automotive OEM suppliers in Pakistan. It provides various assemblies
for instrument cluster/speedometer, brake, switch combination and
few more. Due to atuomotive technolgy transfer, Alsons has set up
a joint venture with the Tatsuno Corporation of Japan for providing
repair and maintenance facility for Tatsuno dispensers and other
machinery. We have brought in 85-years of Tatsuno experience into
Pakistan. We got a highly qualified team, which comprises of over
60 Engineers, along with our well trained and multi-skilled workforce
complement our World Class Quality Management System and gear
us in a cycle of Continuous Improvement in all areas of our business.
We wish to bring in new technology to enhance the quality production

in Pakistan.
Vendor: Baluchistan Wheel Ltd.

CEO: Razzaq Bengali
Since its inception in 1980, Baluchistan Wheels Limited has been a pioneer in the
field of manufacturing steel wheels for automobiles. The technical collaboration
with GKN SANKEY LIMITED
U.K. has resulted in respected
and revered worldwide for its
exceptional quality and standards.
This facility provides a diverse range of wheels for passenger cars,

commercial vehicles, tractor and Suburban vehicles (4 x 4) to varied
original Equipment Manufacturers (OME)’s.
The Company is a corresponding member of European Tyre and

Rim Technical Organization (ETRTO) and certified by AIB Vincotte of
Belgium for ISO-9002.
The Plant is well equipped with highly sophisticated facilities

comprising of the material preparation line, heavy and light duty rim
lines, a press line having presses of up to 1500-ton capacity, an
assembly and welding line with submerged arc welding machines.
BWL has recently inducted Spinning Machine for manufacturing
original CKD designed Truck/Bus Disc Wheels of all sizes. The
BWL also has the capability and the capacity to produce Tubeless
Truck/Bus Wheel. The manufacturing is complemented by the most
modern Cathodic Electro Deposition painting process using latest
paints from Kansai Paint Co. Japan. Specialized facilities of shot blasting, tool and die making, repairing, quality
assurance material and wheel testing also exist. The BWL has the capacity of manufacturing Rims up to 3 Million
wheels annually.
36
Vendor: A-One Techniques (Pvt.) Ltd.

CEO: M.Athar Khan
A-One started as a producer of Rubber based parts in 1983. Our organization
has been developed into a full-fledged automotive manufacturer of Rubber &
Sheet Metal components. A-ONE
has experienced continuous growth
while diversifying our product mix
of parts manufacturing, including
specialization of bonding various
types of rubber with sheet metal. We have received numerous awards
and acknowledgements for excellent quality in Rubber, Plastic and
Sheet Metal Products. These achievements have only been made
possible through efforts put forth by our team of dedicated engineers,
technicians, workers and our commitment to provide world class
components to our valued clients.
A-One is presently one of the leading ISO certified manufacturers and

exporters of Rubber, Plastic and Sheet Metal parts providing quality
components to OEMs including Toyota. We have the most excellent
references from all prestigious 4 Wheelers as well as 2 Wheelers
Assemblers in Pakistan and abroad. Our philosophy of total customer
satisfaction is reflected in Quality, Delivery, Price, Responsiveness, and
After Sales Support. These values are backed by our highly motivated
workforce who is fully equipped to meet ever increasing technology
and quantitative demand of our valued customers.
Vendor: Plastech Autosafe

CEO: Usman Saqid
Plastech Autosafe is the pioneer of automotive safety restraint systems in Pakistan
and has been committed in its objective of providing global industry leading safety
technology to all Automotive
OEM’s in Pakistan. The company
in-house design and lab testing
facilities and is a long standing
supplier to many OEM’s in
Pakistan like Indus Motor Company.
We have an exclusive technical assistance agreement with Autoliv

AB of Sweden. Autoliv is a global leader in automotive safety
systems with 70% global market share and we are Pakistan sole
and exclusive partners. We have the capability to design, develop
and test seat belts locally in our lab with various equipment including
tensile test machine and other equipment specific to seat belts.
We supply a large number of parts to various OEM customers,

including Seat Belts, Air vent Assemblies, Interior and Exterior Plastic
Parts and Sheet Metal Parts. The Company has acquired ISO-
9001:2008, ISO-14001:2008, ISO-22000 & HACCP certifications
to enhance and maintain highest levels of quality standards, In
order to maintain international quality standards and to bring about
continuous improvements in line with changing demands, a team of
highly qualified professionals provides a sound technological base.

Vendor: The General Tyre and Rubber Company of Pakistan Ltd.
CEO: Hussain Kuli Khan
The General Tyre and Rubber Company of Pakistan Limited (GTR) commenced
its production in 1964. The Company was then established by the General Tire
International Corporation (GTIC) of
the USA, with a total capacity of
only 120,000 tyres per annum. In
1985, the Company completed
a major expansion, which took
the capacity to 600,000 tyres annually. Continental AG, Germany’s
number one tyre manufacturer purchased GTIC in 1987 and
thus shared ownership in GTR. Continental provides Technical
Assistance to GTR under a program, which includes training of
our people, formulations, recipe, and selection of equipment and
approved suppliers. GTR under this agreement with Continental is
bound to follow all rules and regulations provided by Continental
including the given quality standards. The name ‘GENERAL’ carries
the highest top of the mind brand name in Pakistan when it comes
to tyres. The capacity of the Company stands at 2.5 million tyres
approximately meeting one third of the country’s demand. General
is producing tyre of different sizes and patterns that cover almost
85% of the sizes in demand in Pakistan. GTR is the first & largest
automotive tyre manufacturer in the country producing tyres for cars,
light commercial vehicles, trucks/buses, tractors, CNG Rickshaw.
While motorcycle tyre plant has been added with the capacity of one
million tyres per annum.
Vendor: Agriauto Industries Ltd.

Chairman: Yutaka Arae
AIL, has increasingly built its status for high quality and leading-edge products,
supported by complete industrial understanding and state of the art equipment
under technical collaboration with leading international companies such as KYB
Corporation Japan, Ride Control
LLC USA, AISIN Corporation Japan,
Ogihara Thailand, Shiroki Japan,
Sannou Riken and KMS Japan.
AIL achieved another milestone by setting-up a world class Stamping

facility in 2012, by the name of Agriauto Stamping Company (ASC) at
Port Qasim in collaboration with “Ogihara – Thailand”. ASC engages in
stamping of sheet metal parts with high tensile material for the automotive
industry.
Our ongoing achievement has come about through our capability to

change. With greater emphasis on 5S and Kaizen, leading to inspiration
and invention, the company is passing through a change in culture and
up-gradation of machinery through Total Production Maintenance (TPM)
under a phased program. It is our firm belief to accept the challenges
which have ensued due to the global business trends.
We are working closely with our customers like Indus Motor Company
Ltd. and has made significant progress with the increased local demand
for auto parts.
38
Vendor: Jodhala Complex (Pvt.) Ltd.

CEO: Mirza Shafqat
Jodhala established in 1990 as an auto parts manufacturing setup with a big dream,
high ideas and honest commitments. The determined efforts and the dynamic
policies for the forward looking
management of the company
finally crowned the project with
success. It also registered a phase
of rapid growth and expansion,
capturing a major share in Auto market of the country.
We at Jodhala provide a wide range of finished products, especially

Pedal set Brake and Clutch, Accelerators, as well as complex
welded Assemblies to all Pakistan based OEMs such as Indus
Motor Company Ltd. etc. with strength of skilled workers and highly
professional management staff. We are committed to expanding on
the basis of specialization, dedication and quality customer services.
Jodhala has been working with IMC since 1993. Here we would
like to appreciate IMC for its endless support in our development.
Its technical training helped us to adopt new modern techniques
like improving the torqueing process of pedal assembly brake and
clutch and to make international standard quality products for our
customers. We wish to expand our facility so that local industry can
create more employment opportunities in Pakistan.

Vendor: Automate Industries (Pvt.) Ltd
CEO: M. Nadeem
We are proud to say that we have been vendors for Toyota Corolla since day one
back in 1993.Automate’s vision has always been to localize production adhering
to all international standards. We are proud to claim that we are the pioneers in this
country of locally assembling tape recorders for Toyota. We aim to further flourish
in this journey of localization, creating an excellent platform for development in
the country, creating job opportunities, facilitating specialization and improving the
country’s balance of payments significantly.
Vendor: Auvitronics
CEO: Abbas Ul Husaini
Auvitronic is among the largest companies in the field of automotive parts which
include lamps, mirrors, steering wheels, wheel caps, EPP parts, chrome and resin
parts. A team of dedicated professionals, employing state-of-art technology has
helped in providing value for money to its customers, both in local and export market.
Toyota Gosei Co. Ltd. Japan, Kanto Kasei Co. Ltd. Japan and Koito manufacturing
Co. Ltd. Japan are providing technical assistance which has supported us to expand
our operations.
Vendor: Exide Pakistan

CEO: Arshad Shehzada
Exide Pakistan is the leading manufacturer of Automotive Batteries in Pakistan.
It was the first Company to install Battery Manufacturing Unit in Pakistan. The
Company produced Exide & Chloride Brand under License from Chloride UK &
FB/TOKYO brands in collaboration with THE FURUKAWA Battery, Japan. FB
brand has been supplied to IMC since 1993. We have developed tooling and
molds for Toyota Cuore, Corolla and IMV.
Vendor: Global Industries Enterprises

CEO: Gulfam A. Shaikh
Global Industries Enterprises joined hands with Indus Motor Company Ltd. in 2001,
since then we are supplying more than 20 high quality chrome plated emblems for
different models of Toyota manufactured at IMC. We look forward to strengthen our
product range by localizing more parts and continuing strong customer relationship
with IMC and wish them a prosperous growth in future.
Vendor: Mehran Commercial

CEO: Ghazanfar Khan
We feel honored to be associated with Indus Motor Company. We are
manufacturing Cover Spare Wheel, Cover Shifting Hole, Cover Parking Brake,
Trim Compartment Luggage FR, Plastic Parts, Floor Mat, Car Cigarette Lighter
and Dash Panel. We are highly responsive to modern know-how and are making
use of best technical standards in our operations. We are the first Pakistani
Company who established the Technical Agreement with AAA PT.APM Armada
Auto-parts Indonesia.
40
Vendor: Pacific International

CEO: Saeed Ahmed
We, Pacific International PVT LTD, are proud to be associated with IMC since
2005. In the beginning, we have supplied Audio systems for Daihatsu Cuore and
Speakers Assembly for all Corolla Variants. Currently we are supplying Audio/
Video systems and USB chargers for different variants of Corolla and Hilux. We
wish IMC a very successful future and look forward to be a part of its team for all
upcoming projects.
Vendor: Thal Engineering

CEO: Akkas ul Hussaini
Being a part of the IMC supplier network, we are providing different category of parts
which include A.C, CSM, Starter/Alternator and Wire harness. We have a Technical
Assistance Agreement with Denso/Furukawa Japan. While recently we signed
another TAA with Yazaki to enhance the technological advancement.
Vendor: Allco
CEO: Nayabuddin
ALLCO Transfer Printers (Pvt.) Ltd. is a manufacturing based firm established in
1964 specialized in Graphics, Emblems and Decals, providing solutions for the
automotive industry. It has technical collaboration with one of the leading printing
firm of Japan. To meet the global challenges ALLCO Transfer Printers (Pvt.) Ltd.,
has acquired the advanced machinery, technical assistance and skilled manpower.
Allco Transfer Printers (Pvt) Ltd. is looking to establish sound business relations
with our valued national and global customers.
Vendor: Atlas Battery

CEO: Ali H. Shiraz
The experience of over 40 years, having been incorporated in 1966 in collaboration
with Japan Storage Battery Company Limited. We are the only battery company in
the industry, having a joint venture with an international company G.S Yuasa Japan.
Atlas Battery is the pioneer in dry charge and heavy duty batteries supplying to the
leading OEM and Motorcycle manufacturers in Pakistan.
Vendor: Panther Sports

CEO: Mian Waqar Ahmed
At Panther Sports we believe in diversifying our product range to support and
being a key player in the industry. We are working hand in hand to bring the
best quality product at the most competitive prices. By maintaining continuous
standards and quality to the satisfaction of our existing customers over the years
and to cater the market demand, management decided to add a manufacturing
line of injection molding, compression molding along with our current products.
We supply rubber parts to IMC.

Vendor: TPL Trakker Ltd.
CEO: Ali Jamil
At TPL Trakker Ltd we are constantly exploring new technologies to deliver more
convenient solutions to our valued customers. Since our inception in 1999 we
have managed to assist customers in enhancing their business performance and
lowering operating costs through solutions that improve fleet efficiency. We will
continue to deliver game-changing innovation and build teams by investing in
people to encourage ambition, learning and development.
Vendor: Yaqeen Art Press (Pvt.) Ltd.

MD: Nafees Uddin
Yaqeen specializes in offset printing material, mostly used in promotional campaigns
and product descriptions; providing brochures, annual reports and different
promotional printing materials used to market automobiles. Yaqeen is serving as a
printing partner for IMC since 1995. Since then most of the CKD and CBU brochures
are printed by Yaqeen. Yaqeen also provides literature for Toyota vehicles to educate
owners when they purchase their car.
Vendor: Hawks Engineering Services (Pvt.) Ltd.

CEO: Muhammad Akram
Hawks Engineering Services (Pvt.) Ltd. in its present shape has a history of over
two decades when we diversified our manufacturing activities from a single
customer Pakistan Engineering Company (PECO) to other sources. It now certainly
is a matter of certification that we manufacture parts conforming to international
standards and supply these to renowned assemblers like IMC.
Vendor: Hinopak Motors Ltd.

CEO: Masaaki Kato
Hinopak Motors Limited assembles, manufactures and markets world renowned
Hino diesel trucks and buses in Pakistan. The Company has held the top position in
the domestic market for medium and heavy-duty vehicles for 17 consecutive years
and is highly acclaimed for quality and technological excellence. We have been
supplying IMV frames to IMC since 2003.
Vendor: Shaheen Automotive (Pvt.) Ltd.

CEO: Azhar Saeed Bhatti
Shaheen Automotive Private Limited (SAPL) provides high quality components
for vehicles. With keen devotion of 34 years, SAPL is counted among the highest
reputable auto parts companies. We are specialized in Metal Sheets and Pipes
part for automobiles. Our latest invention, Green Automotive Solutions, consist of
a range of components that reduce the rate of Carbon dioxide and noise pollution,
not only enhance the efficiency of the vehicle but also make environment healthy
for us.
42
Vendor: Ahmed Glass Industries (Pvt.) Ltd.

CEO: Ejaz Alam
Ahmad Glass Industry was established in 2005. AGI is pioneer in manufacturing of
all types of tempered & laminated safety glasses in Pakistan. We are manufacturing,
automotive safety glasses of OEM standard and architectural safety glasses. Our
goal is to meet the demand of finest quality automotive glasses of OEM. Our aim
is to provide our customers the exquisite quality glass.
Vendor: Alba Engineering Company

CEO: Abdul Basit
Alba Engineering Company is engaged in the production of High Pressure Fuel
Injection Pipes, Hydraulic Pipes, Oil Pipes, Brake clutch and Fuel Pipes and other
allied components for cars that are being used by renowned assemblers like Indus
Motor Company Ltd. Alba Engineering is backed by over 30 years of experience is
exercising strict quality control measures and is supplying these quality components
for all types and makes of Japanese and European vehicles.
Vendor: Al-Badar Engineering Company (Pvt.) Ltd.

CEO: Muhammad Mushtaq Butt
Al Badar Engineering Company has been producing quality products and
specialized items for automotive sector of Pakistan. We have established an
iconic reputation amongst the customers by providing them highly advanced
and technologically latest automotive parts with sheer excellence and vigilance. It
has expanded its business throughout the country by providing supreme quality
products and services.
Vendor: Infinity Engineering (Pvt.) Ltd.

CEO: A.R. Gauhar
Infinity Engineering established in 1994. It is mainly engaged with subcontracting
activities for manufacturing of various types of auto parts and engineering
components. We are specialized in tool designing, grey casting, hot forging,
precision machining, heat treatment and inspection and testing. We supply Wheel
Hubs to IMC. Infinity Engineering is a member of IATF 16949 and is certified ISO
14001 for environmental management system and certified ISO 50001 for energy
management.
Vendor: Mecas Engineering (Pvt.) Ltd.

CEO: Muhammad Wasim Khalid
Mecas Engineering (Pvt) Ltd. established in 1987 and is involved in manufacturing
machine parts for various customers and automotive OEM’s. Today Mecas
Engineering enjoys customer confidence as a leading manufacturer of precision
engineering parts in the country. We are involved in supplying brake discs for
Toyota vehicles manufactured in Pakistan.

Vendor: United Mechnical Industries (Pvt.) Ltd.
CEO: Mirza Tauqeer
UMI manufactures and export fabricated engineering parts for various industries
which include brake paddle, clutch paddle, instrument panel, mufflers, exhaust
pipes and tilting mechanism for automotive industries. We feel proud to be part of
the IMC vendor network. We have been supplying brake pedals and other parts
that are installed in Toyota vehicles in Pakistan.
Vendor: Landhi Engineering Works (Pvt.) Ltd.

CEO: M. Farooq Ahmed
Landhi Engineering Works (Pvt) Ltd, the First ISO Certified (by the Lloyd’s Registered
Quality Assurance (LRQA) Company in Pakistan. Since 1970, we are manufacturing
Leaf Springs for the aftermarket and OEMs. We are the regular Vendor for OEM
(Original Equipment Manufacturer) and supplying Leaf Spring Assemblies as tier 1
vendor to Toyota. Conventional Multi Leaf Springs also been exporting to Germany,
Poland, South Africa, Sri Lanka & Afghanistan.
Vendor: Stanley Industries

CEO: Aftab Ahmed
By the grace of God, we feel pleasure to introduce ourselves as a leading
Manufacturers and supplier of “Sheet Metal Auto Parts” which include fuel filler
pipe, for the last 28 years to OEMs and other Automotive engineering sector of
the country. Our expertise includes design and manufacture of through the years,
our company has developed and diversified its capabilities for the ever-changing
requirements of our customers. It is the constant endeavor of Stanley to achieve
No.1 Customer satisfaction and continuously striving for the fulfillment of the goal
of their Motto “Stanley Believe Quality ”
44
Company Information
Bankers Legal Advisors

Bank Alfalah Limited A.K. Brohi & Company
Bank Al-Habib Limited Mansoor Ahmed Khan & Co.
Citibank N.A. Mahmud & Co.
Habib Bank Limited Sayeed & Sayeed
Habib Metropolitan Bank Limited
MCB Bank Limited Share Registrar
Meezan Bank Limited Central Depository Company of Pakistan Limited
National Bank of Pakistan CDC House, 99-B, Block “B”,
Standard Chartered Bank (Pakistan) Limited S.M.C.H.S., Main Shahrah-e-Faisal,
The Bank of Tokyo-Mitsubishi UFJ Limited Karachi-74400.
United Bank Limited Tel: 0800-23275
UAN: 111-111-500
Auditors Email: [email protected]
A.F. Ferguson & Co.
Chartered Accountants, Factory / Registered Office
State Life Building No. 1-C, Plot No. N.W.Z/1/P-1, Port Qasim Authority,
I.I. Chundrigar Road, Karachi. Bin Qasim , Karachi.
Phone: (PABX) (92-21) 34720041-48
(UAN) (92-21) 111-TOYOTA (869-682)
Fax: (92-21) 34720040
Website: www.toyota-indus.com
46
Chief Financial Officer Board Human Resource and

Mr. Aqeel Loon Remuneration Committee Members
Mr. Azam Faruque (Chairman)
Company Secretary Mr. Ali S. Habib
Mr. Muhammad Arif Anzer Mr. Parvez Ghias
Mr. Yuji Takarada
Head of Internal Audit Mr. Ali Asghar Jamali
Mr. Azam Khan Mr. Mohammad Ibadullah (Secretary)
Board Audit Committee Members Board Ethics Committee Members

Mr. Azam Faruque (Chairman) Mr. Farhad Zulficar (Chairman)
Mr. Mohamedali R. Habib Mr. Parvez Ghias
Mr. Farhad Zulficar Mr. Ali Asghar Jamali
Mr. Susumu Matsuda Mr. Mohammad Ibadullah (Secretary)
Mr. Tetsuya Ezumi
Mr. Parvez Ghias
Mr. Azam Khan (Secretary)

Corporate Governance
IMC’s Basic Approach to Corporate Governance expenditures required to be made and recommends
the same to the Board for approval. The Committee
IMC has a range of long-standing in-house is also responsible for formulating the overall policies
committees responsible for monitoring and for investment in fixed assets, subject to approval
discussing management and corporate activities by the Board, and establishing investment guidelines
from viewpoints of various stakeholders to make in furtherance of those policies. The Committee
prompt decisions for developing strategies, speed consists of the CEO, two Directors, the CFO and
up operation while ensuring heightened transparency Secretary.
and the fulfillment of social obligations. IMC has a
unique corporate culture that places emphasis on Marketing Technical Co-ordination Committee
problem solving and preventative measures in line
with Toyota Global Standards. Marketing Technical Co-ordination Committee
is a management committee responsible for
Basic Concept of Compliance synchronization between the marketing and technical
departments. The committee also controls new
IMC follows the guiding principles of Toyota and products or minor model specification changes and
not only complies with local laws and regulations, schedules. The Committee is chaired by the CEO
but also meets social norms, corporate ethics every month and representatives from marketing
and expectations of various stakeholders. IMC and technical departments attend the meeting.
undertakes open and fair corporate activities to meet
local standards a well as Toyota Global Standards. ACT #1 Management Committee
The Audit Committee consists of four non-Executive
Directors and one independant Director. The ACT #1 Management Committee is responsible
for the monitoring of organizational KPIs and
Board Human Resource and Remuneration stewardship of financial performance every
Committee month. It also reviews departmental targets and
accomplishments achieved during the month. In
The Remuneration Committee is a sub-committee addition ACT #1 reviews government regulatory
of the Board. It recommends human resource affairs including macro-economic situations which
management policies to the Board. It also results in formation of the Company’s strategy and
recommends selection, evaluation, compensation risk management policies. The meeting is headed
and the succession plan of the CEO and Senior by the Chairman with representation from all
Management employees who directly report to departments.
the CEO. The Committee consists of three Non-
Executive Directors, one Executive Director and the Safety, Health and Environment Committee
CEO.
The Committee meets on a monthly basis and
Board Ethics Committee keeps a close eye on company wide Safety, Health
and Environment (S.H.E) statistics, KPI trends,
The Committee has the responsibility of overseeing relevant local laws compliance, promulgating drive
ethical policies and compliance by the Company. and focus on S.H.E. right from the top; enabling
It provides expeditious actions on disclosures of Management to have a first hand feel of S.H.E issues
wrongdoing. The Ethics Committee also reviews prevailing on the shop floor and ways to resolve
and investigates incidents of whistle-blowing. The them via efficient and swift decision-making. The
Committee consists of the CEO and two Non- S.H.E Committee, chaired by the CEO, formulates
Executive Directors. the overall policies and S.H.E framework for
the company.
Investment Committee
The Investment Committee assists the Board in

fulfilling its oversight responsibility for the investment
in assets of the company. It evaluates the capital
48
Organization Chart
BOARD OF DIRECTORS
HR &
Audit Committee Remuneration Ethics
Committee Committee
CEO
Safety Health and Investment

Finance & Environment Committee
Internal Audit Commercial Committee
Marketing
Committee
Customer
Administration Human Sales & Information Technical & Corporate
Resource Marketing Technology Division Engagement

STRENGTHENING
Expansions
Rising demand has pushed the auto industry to expand and enhance their capacity.
In order to cope up with the demand, supply needs to maintain accordingly, this
requires multi-billion investments. IMC is always keen to facilitate its customers.
Recently, a new paint shop was inaugurated and made operational; previously
it was a major bottleneck in increasing the capacity. This initiative took a multi-
billion rupees investment which will significantly increase the production capacity.
Shareholder Information
Factory / Registered Office
Plot No. N.W.Z./1/P-1, Port Qasim Authority
Bin Qasim, Karachi.
PABX: (92-21) 34720041-48
Fax: (92-21) 34720040
Share Registrar
Central Depository Company of Pakistan Limited
CDC House, 99-B, Block “B”
S.M.C.H.S., Main Shahrah-e-Faisal,
Karachi-74400.
Tel: 0800-23275
UAN: 111-111-500
Email: [email protected]
Annual General Meeting

The Annual General Meeting will be held at 9:00 a.m. on October 16, 2018 at the Institute of Chartered
Accountants of Pakistan, Karachi.
Shareholders as on October 8, 2018 are encouraged to participant and vote.
Any shareholder may appoint a proxy to vote on his or her behalf. Proxies must be deposited with the Company
not less than 48 hours before the Meeting.
Ownership
On June 30, 2018 there were 3,983 shareholders on record of the Company’s ordinary shares.
Dividend Payment
The proposal of the Board of Directors for dividend payment will be considered at the Annual General Meeting.
The dividend net amount will be credited into the respective account of shareholders listed in the register of
members on October 8, 2018. Income Tax will be deducted in accordance with the provisions of Income Tax
Ordinance, 2001.
52
Listing on Stock Exchanges

Indus Motor Company Limited equity shares are listed on the Pakistan Stock Exchange.
Stock Code
The stock code for dealer in equity shares of Indus Motor Company Limited at PSX is INDU.
INDU Vs PSX/KSE 100 (1992 - 2018)

As at June 30th
7,000 Share Prices and Volumes 2017-18
Pakistan Stock Price in Rupees Daily
Exchange Average
6,000
High Low Volume
First Quarter 1887.44 1580.00 21,765
Second Quarter 1825.00 1595.00 25,770
5,000
Third Quarter 1980.00 1670.00 11,963
INDU
Fourth Quarter 1920.00 1300.00 28,602
Relative Index
4,000 INDU
PSX/KSE 100 index
3,000 PSX 100
2,000
1,000
0
1992 1993 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Operating Highlights
Net Revenues (Rs. in billion) Vehicle Production (Units)

2018 140.2 2018 62,886
2017 112.3 2017 59,945
Vehicle Sales (Units) Earnings Per Share (Rs.)
2018 64,000 2018 200.7
2017 60,586 2017 165.4
Year ended June 30
2018 2017
Profit after Tax Rs in billion 15.8 13.0
Annual Cash Dividend Per Share Rs 140.0 115.0
Shareholders’ Equity Rs in billion 36.7 31.2
Contribution to National Exchequer Rs in billion 49.0 39.0
Manpower No. of employees 3,266 2,849
54
Financial Summary
% Change Year ended June 30

2018 Vs
For The Year: 2017 2018 2017 2016 2015 2014 2013
Units sold 6% 64,000 60,586 64,584 57,387 34,470 38,517

Net revenues Rs in billion 25% 140.2 112.3 108.8 96.5 57.1 63.8
Profit before tax Rs in billion 20% 23.0 19.1 17.4 14.1 5.0 4.9
Profit after tax Rs in billion 21% 15.8 13.0 11.5 9.1 3.9 3.4
Return on equity Percentage 3% 42.9 41.7 41.5 37.9 19.4 19.0
Per Share Data:
Earnings (EPS) Rs 21% 200.7 165.4 145.7 115.9 49.3 42.7

Cash dividends Rs 22% 140.0 115.0 100.0 80.0 29.5 25.0
Shareholders’ equity Rs 18% 467.5 396.9 351.5 305.8 253.4 225.1
At Year-End:
Total assets Rs in billion 28% 81.9 63.9 57.5 50.4 26.1 25.1
Shareholders’ equity Rs in billion 18% 36.7 31.2 27.6 24.0 19.9 17.6
Share Performance (June 30):
Price per share Rs -21% 1,421.5 1,793.6 939.5 1,249.0 537.9 311.0
Market capitalization Rs in billion -21% 111.7 141.0 73.8 98.2 42.3 24.4
Net Revenues Net Income / ROE EPS / Dividend per share

EPS
Net Income
Cash Dividend Per Share (Right scale)
ROE (Right scale)
(Rs in billion) (Rs) (Rs)
(Rs in billion) (%)
15.8
150 16.0 50 250 165
140.2
13.0 45 200.7
145
120 112.3 12.8 40 200
108.8 11.5 165.4 125
96.5 35
145.7
105
90 9.6 9.1 30 150
115.9
25 85
63.8
57.1
60 6.4 20 100
65
3.9
15
49.3 45
3.4
30 3.2 10 50 42.7
25
5
0 0.0 0 0 5
2013 2014 2015 2016 2017 2018 2013 2014 2015 2016 2017 2018 2013 2014 2015 2016 2017 2018

ACHIEVING
Milestones
In the first year, 1993, IMC manufactured 714 vehicles. Moving forward with
the progress, achieving significant levels of localization has helped in reducing
the cost of production and making IMC products more market competitive.
This year IMC has been able to achieve the milestone of manufacturing
750,000 vehicles owing to increasing market demand. This huge success
was only achievable due to the IMC’s commitment to provide customers
with road experience of the highest quality.
Vertical Analysis
2018 2017 2016 2015 2014 2013 2018 2017 2016 2015 2014 2013
STATEMENT OF FINANCIAL
POSITION ----------------------- (Rs in million) -------------------------- ---------------------- (Percentage) ------------------------
Property, plant and equipment 7,225 6,258 4,919 5,184 6,032 2,742 8.82 9.80 8.55 10.29 23.10 10.92
Intangibles 87 88 19 10 1 - 0.11 0.14 0.03 0.02 0.00 -
Long-term loans and advances 49 9 4 11 29 131 0.06 0.01 0.01 0.02 0.11 0.52
Long-term investments - - 5,006 4,955 - - - - 8.70 9.83 - -
Long-term deposits 9 9 10 10 10 10 0.01 0.01 0.02 0.02 0.04 0.04
Deferred taxation 14 74 199 5 - 34.35 0.02 0.12 0.35 0.01 - 0.14
Stores and spares 301 204 154 179 142 154 0.37 0.32 0.27 0.35 0.54 0.61
Stock-in-trade 11,151 9,318 7,785 6,150 4,469 7,883 13.61 14.59 13.53 12.20 17.12 31.40
Trade debts 1,453 759 1,132 448 1,737 1,383 1.77 1.19 1.97 0.89 6.65 5.51
Loans and advances 3,715 1,653 1,125 1,221 1,006 1,558 4.53 2.59 1.96 2.42 3.85 6.21
Short-term prepayments 15 21 46 19 15 11 0.02 0.03 0.08 0.04 0.06 0.04
Accrued return 120 376 513 419 87 12 0.15 0.59 0.89 0.83 0.33 0.05
Other receivables 556 402 191 168 176 163 0.68 0.63 0.33 0.33 0.67 0.65
Short-term Investments 55,031 41,488 33,697 26,257 9,121 6,698 67.17 64.95 58.57 52.10 34.93 26.68
Taxation - payment less provision - - - - 1,216 131 - - - - 4.66 0.52
Cash and bank balances 2,201 3,221 2,738 5,365 2,068 4,195 2.69 5.04 4.76 10.65 7.92 16.71
Total Assets 81,927 63,880 57,537 50,399 26,111 25,106 100.00 100.00 100.00 100.00 100.00 100.00
Issued, subscribed and paid up capital 786 786 786 786 786 786 0.96 1.23 1.37 1.56 3.01 3.13
Reserves 35,958 30,411 26,844 23,250 19,130 16,907 43.89 47.61 46.65 46.13 73.26 67.34
Shareholders' Equity 36,744 31,197 27,630 24,036 19,916 17,693 44.85 48.84 48.02 47.69 76.27 70.47
Deferred taxation - - - - 219 - - - - - 0.84 -
Deferred Revenue 27 4 - - - - 0.03 0.01 - - - -
Trade, dividend and other payables 15,974 9,683 10,035 9,181 4,430 6,014 19.50 15.16 17.44 18.22 16.97 23.95
Advances from customers and dealers 27,491 22,189 19,127 16,193 1,546 1,399 33.56 34.74 33.24 32.13 5.92 5.57
Taxation - provision less payment 1,691 807 745 990 - - 2.06 1.26 1.29 1.96 - -
Total Equity and Liabilities 81,927 63,880 57,537 50,399 26,111 25,106 100.00 100.00 100.00 100.00 100.00 100.00
PROFIT AND LOSS ACCOUNT

Net Sales 140,208 112,272 108,759 96,516 57,064 63,829 100.00 100.00 100.00 100.00 100.00 100.00
Cost of sales 115,831 92,450 91,027 82,272 51,270 57,972 82.61 82.34 83.70 85.24 89.85 90.82
Gross profit 24,377 19,822 17,731 14,244 5,794 5,857 17.39 17.66 16.30 14.76 10.15 9.18
Distribution costs 1,284 1,228 1,061 996 794 814 0.92 1.09 0.98 1.03 1.39 1.28
Administrative expenses 1,524 1,053 931 799 635 644 1.09 0.94 0.86 0.83 1.11 1.01
Other operating expenses 194 177 144 119 52 66 0.14 0.16 0.13 0.12 0.09 0.10
WPPF and WWF 1,705 1,418 1,285 1,052 372 370 1.22 1.26 1.18 1.09 0.65 0.58
Operating income 3,901 3,593 3,164 2,907 1,113 1,038 2.78 3.20 2.91 3.01 1.95 1.63
Finance costs 572 398 77 52 38 31 0.41 0.35 0.07 0.05 0.07 0.05
Profit before taxation 22,999 19,141 17,397 14,133 5,016 4,970 16.40 17.05 16.00 14.64 8.79 7.79
Taxation 7,227 6,140 5,943 5,022 1,143 1,612 5.15 5.47 5.46 5.20 2.00 2.53
Profit after taxation 15,772 13,001 11,455 9,110 3,873 3,358 11.25 11.58 10.53 9.44 6.79 5.26
58
Horizontal Analysis
2018 2017 2016 2015 2014 2013 2018 vs 2017 vs 2016 vs 2015 vs 2014 vs
2017 2016 2015 2014 2013
STATEMENT OF FINANCIAL
POSITION ----------------------- (Rs in million) -------------------------- ---------------------- (Percentage) ------------------------
Property, plant and equipment 7,225 6,258 4,919 5,184 6,032 2,742 15.45 27.22 (5.11) (14.07) 119.99
Intangibles 87 88 19 10 1 - (1.14) 356.17 98.32 872.70 -
Long-term loans and advances 49 9 4 11 29 131 444.44 137.22 (65.81) (62.25) (77.62)
Long-term investments - - 5,006 4,955 - - - (100.00) 1.03 - -
Long-term deposits 9 9 10 10 10 10 - (9.53) 2.91 - -
Deferred taxation 14 74 199 5 - 34 (81.08) (62.74) 3,651.10 102.42 (737.48)
Stores and spares 301 204 154 179 142 154 47.55 32.85 (14.02) 26.08 (7.82)
Stock-in-trade 11,151 9,318 7,785 6,150 4,469 7,883 19.67 19.69 26.58 37.61 (43.30)
Trade debts 1,453 759 1,132 448 1,737 1,383 91.44 (32.93) 152.75 (74.23) 25.64
Loans and advances 3,715 1,653 1,125 1,221 1,006 1,558 124.74 46.87 (7.79) 21.33 (35.43)
Short-term prepayments 15 21 46 19 15 11 (28.57) (53.87) 140.60 26.62 38.36
Accrued return 120 376 513 419 87 12 (68.09) (26.76) 22.57 379.46 618.67
Other receivables 556 402 191 168 176 163 38.31 110.14 14.04 (4.51) 7.71
Short-term Investments 55,031 41,488 33,697 26,257 9,121 6,698 32.64 23.12 28.34 187.86 36.18
Taxation - payment less provision - - - - 1,216 131 - - - (181.41) 825.96
Cash and bank balances 2,201 3,221 2,738 5,365 2,068 4,195 (31.67) 17.66 (48.98) 159.44 (50.70)
Total Assets 81,927 63,880 57,537 50,399 26,111 25,106 28.25 11.02 14.16 93.02 4.00
Issued, subscribed and paid up capital 786 786 786 786 786 786 - - - - -
Reserves 35,958 30,411 26,844 23,250 19,130 16,907 18.24 13.29 15.46 21.54 13.14
Shareholders' Equity 36,744 31,197 27,630 24,036 19,916 17,693 17.78 12.91 14.95 20.69 12.56
Deferred taxation - - - - 219 - - - - 102.42 737.48
Deferred Revenue 27 4 - - - - 575.00 - - - -
Trade, dividend and other payables 15,974 9,683 10,035 9,181 4,430 6,014 64.97 (3.51) 9.31 107.22 (26.33)
Advances from customers and dealers 27,491 22,189 19,127 16,193 1,546 1,399 23.89 16.01 18.12 947.60 10.51
Taxation - provision less payment 1,691 807 745 990 - - 109.54 8.34 (24.78) 181.41 -
Total Equity and Liabilities 81,927 63,880 57,537 50,399 26,111 25,106 28.25 11.02 14.16 93.02 4.00
PROFIT AND LOSS ACCOUNT

Net Sales 140,208 112,272 108,759 96,516 57,064 63,829 24.88 3.23 12.68 69.14 (10.60)
Cost of sales 115,831 92,450 91,027 82,272 51,270 57,972 25.29 1.56 10.64 60.47 (11.56)
Gross profit 24,377 19,822 17,731 14,244 5,794 5,857 22.98 11.79 24.48 145.86 (1.08)
Distribution costs 1,284 1,228 1,061 996 794 814 4.56 15.75 6.51 25.52 (2.54)
Administrative expenses 1,524 1,053 931 799 635 644 44.73 13.13 16.54 25.85 (1.45)
Other operating expenses 194 177 144 119 52 66 9.60 23.05 20.42 129.67 (21.43)
WPPF and WWF 1,705 1,418 1,285 1,052 372 370 20.24 10.31 22.15 182.91 0.54
Operating income 3,901 3,593 3,164 2,907 1,113 1,038 8.57 13.54 8.86 161.09 7.27
Finance costs 572 398 77 52 38 31 43.72 415.07 48.93 35.63 24.59
Profit before taxation 22,999 19,141 17,397 14,133 5,016 4,970 20.16 10.02 23.10 181.72 0.94
Taxation 7,227 6,140 5,943 5,022 1,143 1,612 17.70 3.32 18.32 339.38 (29.10)
Profit after taxation 15,772 13,001 11,455 9,110 3,873 3,358 21.31 13.50 25.74 135.20 15.37

Statement of Value Addition
For the year ended 30 June 2018
2018 2017
Rupees in ‘000 % Rupees in ‘000 %
Wealth Generated
Gross revenue 168,827,803 97.7% 135,681,765 97.4%
Other income 3,900,685 2.3% 3,593,425 2.6%
172,728,488 100.0% 139,275,190 100.0%
Bought in material and services and other expenses 103,581,088 60.0% 83,555,766 60.0%
69,147,400 40.0% 55,719,424 40.0%
Wealth Distributed
Employees
Salaries, wages and other benefits 2,852,016 4.1% 1,937,435 3.5%
Society
Donations towards education, health and environment 190,530 0.3% 173,975 0.3%
Providers of Finance
Finance cost 572,406 0.8% 397,998 0.7%
Government
Income tax, sales tax, excise duty, customs duty, WWF 47,836,854 69.2% 38,605,810 69.3%
and WPPF
Shareholders
Dividend 11,004,000 15.9% 9,039,000 16.2%
Retained within the business for future growth

Retained earnings, depreciation and amortization 6,691,594 9.7% 5,565,206 10.0%
69,147,400 100.0% 55,719,424 100.0%
Distribution Of Wealth
15.9% 16.2%
9.7% 10%
2018 2017
4.1% 3.5%
0.3% 0.3%
0.8% 0.7%
69.2% 69.3%
Employees Society Providers of finance Government Shareholders

Retained within the business for future growth
60
Ali S. Habib
Chairman
Chairman’s Review
“I welcome you to this 29th Annual General Meeting
of your Company for the year ended June 30, 2018.”
62
Dear Shareholders, efforts to document the economy and broaden the tax
base, such drastic and sudden actions transfer the
Over the past 29 years, Indus Motor Company (IMC) responsibility to the private sector to implement these
Limited, has established benchmarks in excellence actions, adding unnecessary complications to our
in the country’s automotive industry. We have been business processes and increasing the cost of doing
able to achieve such success by maintaining high business.
quality standards and by providing our customers
innovative solutions and services according to their The successful conclusion of the general elections,
needs. Toyota’s philosophy of ‘kaizen’ – continuous further strengthening the democratic tradition, bodes
improvement – permeates through all aspects of what well for the country. At IMC we look forward to working
we do here in Pakistan as well. The company continues with the incoming government and to provide our
to be acknowledged and recognized for its societal extensive experience towards conducive policies for
contribution and emphasis on human development. strengthening the local automobile industry.
As we complete another year, let us take this time to
celebrate our successes and to grasp the opportunities The Company boasts an extensive distribution model
that lie ahead. based on independently owned dealerships spread
across the country. Our far reaching and ever-growing
I am pleased with the performance of IMC for the year network constantly endeavors to meet the customer
ended June 30th, 2018. In a succession of years of expectations for service and spare parts. IMC aims
growth for the Company, this year has also achieved to be the most respected organization in the eyes of
improved performance and growth, despite the its employees and customers alike. The management
prevailing macro-economic challenges that affect the has taken bold steps and stringent actions to curb the
automobile industry, including Pakistan’s trade gap and hazard of premium by identifying and cancelling booking
the hike in oil prices; IMC has managed to achieve the orders twice during the last fiscal year.
highest ever sales revenue. The Directors’ Report will
further elaborate on our financial results and operations. Pivotal to the Company’s success continuing forward is
the implementation of a robust governance framework
To meet the growing demand and to further improve that ensures the effective and prudent management of
quality, the Company has invested in a new paint business matters. Accordingly, the Board has clearly
facility which was commissioned during the closing defined its strategic vision and goals based on its
months of the last fiscal year. Modifications in certain thorough understanding of all the challenges to meet
auxiliary facilities have been planned during the two the expectation of all stakeholders.
limited shut down in August (during the Eid holidays)
and later on in December, after which the capacity I am pleased to report that your Company’s Board of
increase will be achieved. We pushed the boundaries of Directors have continued to provide valuable guidance
the industry and expanded our business portfolio with and oversight to ensure strong governance and
the introduction of attractive new features and use of effectively provide encouragement and input to the
pioneering technologies. The continued success of our management throughout the year. A review of the
Company has been made possible through our shared Board’s own performance and effectiveness on a self-
vision, strategic business partnerships and the joint assessment basis has been conducted and appreciated,
efforts of all stakeholders on board with us. during the year under review, to ensure Best Practices.
Pakistan’s automobile market has been experiencing a Finally, on behalf of the Board of Directors, I would
steady growth and is forecasted to reach a level of five like to express my gratitude to all shareholders for
hundred thousand units by the year 2022. New auto your continued trust and confidence in the Company
players have made their way into the market, motivated and further on behalf the Board, I sincerely thank each
by the country’s Auto Development Policy 2016-21, member of the IMC team for their unwavering support
opening the doors to a multitude of joint ventures. and dedication. We are committed to maintaining our
However, we believe that the true growth and benefits leadership in the industry and pray to Almighty Allah to
of technology transfer, job creation and value addition bless us in our endeavors.
can be fully realized by incentives for local Auto Parts
Manufacturers, which have not been considered in the
new Auto Development Policy. We also remain cautious
on the rising trend of used car imports that may affect
both existing and new players, unless measures are
taken to avoid the misuse of such import facilities. The
Federal Budget for 2018-19 was presented unusually
early, in which a significant change was made whereby
non-tax filers cannot purchase or register locally made Ali S. Habib
new cars. While we fully support the Government’s Chairman

Directors’
Report
Ali Asghar Jamali

Chief Executive
• Industry Review & Business • Operations

Environment
• Information Technology
• Company Review
• Corporate Social Responsibility -
• Customer Relations Advancing Concern Beyond Cars
• Customer First – Parts & Service • Corporate Matters & Related
Disclosures
• Safety, Health & Environment
• Human Resources
64
The Directors of Indus Motor Company Limited takes pleasure in presenting Directors’ Report, together with
the Audited Financial Statements of the Company for the year ended June 30, 2018:
Financial Results, Appropriations and Subsequent Effects

The Financial results and appropriations for the year ended June 30, 2018 are as follows:
2018 2017
(Rupees in ‘000)
Profit After Taxation 15,771,860 13,001,265
Other Comprehensive Loss for the year (6,480) (1,912)
Un-appropriated Profit brought forward 12,412 52,059
15,777,792 13,051,412
Appropriations
1st Interim Dividend @ 300% i.e. Rs. 30.00 per share (2017: 250% i.e. 25 per share) 2,358,000 1,965,000
2nd Interim Dividend @325% i.e. Rs. 32.50 per share (2017 250% i.e. Rs. 25 per share) 2,554,500 1,965,000
3rd Interim Dividend @ 325% i.e. Rs. 32.50 per share (2017: 300% i.e. Rs. 30 per share ) 2,554,500 2,358,000
7,467,000 6,288,000
Unappropriated Profit Carried Forward at year end 8,310,792 6,763,412
Subsequent Effects
Proposed Final Dividend @ 450% i.e. Rs. 45 per share (2017: 350% i.e. Rs.35 per share) 3,537,000 2,751,000
Proposed Transfer to General Reserves 4,500,000 4,000,000
8,037,000 6,751,000
Basic and Diluted Earnings per share 200.66 165.41
Principal Activities of the Company The company has posted new records on the financial
Indus Motor Company Limited (the Company) front with net sales revenue of Rs. 140.21 billion, up
was incorporated in Pakistan as a public limited by 25% as compared to Rs. 112.27 billion last year,
company in December 1989 and started commercial while profit after tax grew by 21% to 15.77 billion from
production in May 1993. The shares of the Company Rs. 13 billion posted last year. The overall increase in
are quoted on the Pakistan Stock Exchange. The the revenue and net profits is mainly attributable to
company’s principal activity is the assembly, the improved turnover on account of launch of new
progressive manufacturing and marketing of Toyota models, change in sales mix and higher other income
vehicles in Pakistan. on account of increase in fund size.
Contribution to National Exchequer

Financial Performance Overview During the year, the Company contributed a sum
During the year ended June 30, 2018, the sales of Rs. 49 billion to the national exchequer, which
volume of CKD and CBU vehicles increased to amounts to about 1% of the total revenue collection
64,000 units as against 60,566 units sold last year. by the Government of Pakistan during the year.
Despite of increased volume, the Company’s market Since the Company’s incorporation in 1989, our
share declined from 28% to 24%, mainly due to contribution stands in excess of Rs. 366 billion.
overall market expansion and growth.

Industry Review & Environment
Business Environment, Risk and Uncertainties fiscal year 2018-19. While this is an appreciable
Pakistan’s macroeconomic fundamentals are a cause initiative and will help FBR broaden the tax filer’s base.
of concern for the industry, especially on account of However, the government should adopt a systematic
the current account deficit standing at $30 billion. approach to gradually phase out purchases by non-
Pakistan has achieved marginally stronger export filers.
growth, but rising oil prices and weaker capital
inflows, together with a significant rise in imports, are The Federal Budget for 2018-19 surprisingly
weighing on the balance of payments. The recovery introduced a dramatic reduction in duties and taxes
in agriculture and a stronger manufacturing output on vintage cars. While we do not expect these
are both positive aspects of the country’s growing measures to have any meaningful impact on the
economy. industry, yet its introduction can only be attributed
to some extraordinary special interest which is in
We expect economic growth in the next fiscal year complete contradiction to a well-considered Auto
to remain moderate due to large fiscal and current Policy.
account deficits, rising external debt and tighter
financial conditions. The Pak Rupee is expected to The Budget also introduced a drastic reduction in
remain under pressure, adding to inflation concerns duties on CBU and CKD electric cars with immediate
and weaker consumer spending thus impacting auto effect. As there are no existing and currently planned
industry growth. local facilities for the manufacture of electric cars,
these measures will only facilitate the import of high
The China-Pakistan Economic Corridor (CPEC) end luxury electric vehicles. The policy makers have
projects are moving ahead supporting the not considered that while electric vehicles may be the
infrastructural development and creating more future, that other than the electric motor and battery
confidence for the investor with visible improvement to replace the engine, transmission and fuel tank, the
in the law and order situation, an important factor in electric vehicles will require body shell, seats, interior
regard to attracting more foreign direct investment. trims, lighting systems, wiring harnesses, suspension
The new Automotive Development Policy 2016-21 is systems, instrument panels, etc., all of which are
encouraging new entrants to establish manufacturing produced locally and used in conventional vehicles.
units and augers well for Pakistan. The current structure of tariff for the manufacture
of these locally made parts are substantially higher
The presence of many new makes and models than what has been proposed for import of both
in the coming year will provide customers a much finished vehicles and their imported components.
wider choice of products and aftermarket services Such ill- conceived measures are contrary to the
which will result in increased competition. We are national interest, are unsustainable and can create a
embracing this opportunity to position ourselves as significant distortion in market forces and erode the
the number #1 choice for discerning customers. confidence of existing investors as well as the new
entrants.
In order to fully realize the benefit at a national level
of the Auto Policy it is essential that this market We are hopeful that the new Government’s 100-day
expansion result in job creation, higher local value plan will take notice of such anomalies and issue
addition and technology transfer; all of which are amendments to correct the inconsistencies.
only possible by providing a competitive but a level
playing field for local parts manufacturers. Industry Review
Robust sales of automobiles during the fiscal year
Regrettably, the Auto Policy has provided no
2017-18 enabled the OEMs and the parts suppliers
incentives to local parts makers, on the contrary,
to operate at maximum capacities to meet the
recent FBR measures to curb imports by imposing
rising demand. The total industry sales of locally
Regulatory Duty seem to have inadvertently targeted
manufactured PC & LCV vehicles were 258,632
raw material and other engineering inputs whereby
units in the country during 2017-18 compared to
creating a clear disincentive to manufacture locally in
213,087 units sold last year, indicating a 21% rise.
favor of finished auto parts, creating further pressures
The overall growth momentum in the automobile has
on our foreign exchange reserves.
remained strong owing to rising disposable income
The Federal Budget 2018-19 states that non-filers will of customers, improved law and order situation,
not be allowed to book, register or purchase locally increased auto financing and growth in ride hailing
manufactured or imported vehicle from the start of services. It is interesting to note that despite political
turmoil within the country and rupee uncertainty,
66
demand in the marketplace remained upbeat. Our driven by the introduction of the new locally produced
assertion is supported by the fact that approximately models. The improved Corolla Altis Grande, the All-
70,000 used cars landed in the country under various New Toyota Fortuner and the All-New Toyota Hilux
schemes, up by 18% compared to 59,000 units REVO have been well-received by the consumer
imported last year. The growth in demand was also base in the relevant segments.
Sales of Locally Produced Passenger Cars & LCV

300
259
250
No. of Vehicles '000
218 213 42
200 180 37 27
99
29 94
150 135 137 87
17 19 79
100 60 58 50
26 35
13 16 19
50
45 44 53 68 57 68
0
2012-13 2013-14 2014-15 2015-16 2016-17 2017-18
up to 800cc 1000cc 1300cc-2000cc LCV
Recommendations we responded in time to all our obligations, regretfully,

We wish to record our strong appreciation for the the government has yet to consider the proposals we
Federal Government’s efforts in broadening the tabled to curb the menace of premium, which has
taxpayer base and for curbing the undocumented resulted in dissatisfaction of our loyal customers. Our
economic base. The Pakistan market offers huge proposal aims at imposition of a transfer tax on the
potential, we urge the Government to bolster good first buyer who, as an investor, is selling the vehicle
governance as a key item on the public policy soon after taking delivery. The Company believes
agenda and introduce long-term industrial policies in this would considerably discourage investors and
order to restore market confidence without stifling the safeguard genuine customer interests.
dynamism that underlies all economic activity.
We also recommend that the disproportionate load
In tandem with the government’s measures to increase placed on the formal corporate sector for collection
competition and industry production volumes, it is of taxes of withholding nature be reviewed as it is
also imperative to thoroughly revamp the distribution becoming increasingly complex to manage and is
mechanism without which the benefits of competition adding significantly to the cost of doing business in
cannot reach the real customers. Your Company will the country.
continue advocating for the government to revisit
the double taxation regime which is hampering the We are confident that the Government will effectively
auto industry to move from the current distribution control the ongoing malpractices of under-invoicing
mechanism to a wholesale-retail method. The and incorrect declaration of imported auto parts and
proposed distribution model is already implemented used CBUs, by unprincipled importers. During the
in the motorcycle industry. year, some corrections have been made in parts
valuation disparity. However, many other anomalies
Longer waiting period in the delivery of almost all need to be corrected.
models across the industry is a point of concern for
all stakeholders. While, the Auto Development Policy
(ADP) proposed measures to address this issue and

Company Review
Your Company, as a major player in Pakistan’s including state of the art safety features. These
automobile industry, has made encouraging advances features include standardization of dual SRS Airbags
and has continued its track-record of achieving key in all passenger cars and SUV models.
milestones. Building on our previous performances,
the fiscal year ending June 2018 has once again Toyota Corolla – CKD Passenger Car Segment:
been a period in which the Company’s turnover and To further enrich the customer experience for Corolla
profitability have soared to an all-time high. IMC has customers, IMC introduced a minor model change
not only managed to maintain its sales above the in the vehicle and unveiled the all-new Corolla Atlis
60,000 units mark for the third consecutive year, but Grande at the 26th Dealers’ Conference in August
also boasts a record high financial performance. This 2017. The much awaited all-new Corolla Altis
reflects strong customer confidence in the company Grande was launched with technologically-advanced
and the value proposition offered to the customer. specifications such as a Smart Entry and Push Start
System, Auto-reverse Link Mirrors, Sports Mode
65,000
60,586
64,000 and Paddle Shift, all of which add up to offer an
extraordinary experience for its users.
52,000
No. of Vehicles
39,000
60,586 64,000
26,000
13,000
0
2016-17 2017-18
Sales
This year, many challenges were faced by the

manufacturing division throughout the period. A
pressing demand continued to exist for meeting Unveiling the all-new Corolla Atlis Grande at the
production targets. Preparations were made in the 26th Dealers’ Conference in August 2017.
third quarter for minor improvements in the highly
successful Fortuner and Hilux by introducing the Being a leader in safety, Toyota works tirelessly to
powerful 1GD engine. Furthermore, advanced provide peace-of-mind to its customers through
features were introduced that led to rise in demand. its best-in-class safety features. The minor model
change in Corolla incorporated some major safety
Our basic values are based on the Spirit of “Kaizen”
specifications, including Dual SRS airbags, Front
or Continuous Improvement. We have taken
seatbelt: 3-Point ELR with Pretensioner and Force
necessary steps to eradicate bottlenecks and
Limiter, GOA Body with Reinforcement and ISOFIX
increase production capacity. A newly constructed
Child Seat Anchors making Corolla the best-in-class
multi-billion rupee paint shop was commissioned in
vehicle in Pakistan’s sedan segment.
the last quarter resulting in increased output. All our
efforts have been directed at reducing the delivery Corolla’s segment sales growth for the year FY17-18
period of vehicles and further adding to customer witnessed 5% growth from 89,680 units to 94,222
satisfaction. units owing to the rise in competition and a growing
Sedan market. However, due to the rise in Forturner
The Company continues to make major investments
and operates its manufacturing facility at full capacity. 100,000 94,222
89,680
Manufacturing has continued with employee
overtime hours and manufacturing operations are 80,000
42,810
37,004
also undertaken on off Saturdays to meet market
No. of Vehicles
60,000
demand. The total production of the Company stood
at 62,886 units, which shows a 5% increase from the 40,000
59,945 units that were produced in the corresponding 51,412
52,676
period last year. 20,000
As per the Auto Development Policy, we have stood 0

by our commitments and have introduced various 2016-17 2017-18
specification upgrades in the entire lineup of vehicles, Corolla Competition
68
and IMV production, our Corolla production stood at Diesel engine which is turbocharged and equipped
51,412 Corolla units compared to 52,676 units last with an Inter-Cooler. This allows the 4x4 vehicle to
year allowing the competition to gain traction and conquer all terrains. Building on its futuristic styling
increase volume by 16%. and luxurious interior, this variant is equipped with
Push Start, Smart Entry, Powered Back Door, Vehicle
Toyota Hilux – CKD Pickup Segment Stability Control, Hill-start Assist Control, and Down-
Building upon its legacy of providing outstanding hill Assist Control.
vehicles, IMC successfully launched the 8th generation
of its Hilux series with improvements in February’18. The second variant continues with the 2TR Petrol
This refashioned Hilux is aimed to address the ever- engine offering a full-time 4x2 drive, a feature that
changing needs of our valued pickup customers. makes this variant the perfect choice for urban users.
The all-new Toyota Hilux REVO was introduced with The market response to the new Fortuner has been
the much-awaited powerful and ultra-efficient 1GD exceptional with 204% growth from 1,375 units to
Diesel engine which is turbo-charged and equipped record high level of 4,186 units this year.
with an inter-cooler. The enriched performance
5,000
features consist of 6-Speed Transmission, Vehicle
4,186
Stability Control, Hill-start Assist Control, Down-hill 4,000
Assist Control, Push start, smart entry and Drive
No. of Vehicles
Modes to ensure a seamlessly exhilarating off-road 3,000 3,375
4,186
experience.
2,000
True to its name, REVO continues to be a luxurious 1,375
4x4, graceful enough for businessmen in the urban 1,000 1,375
areas and tough enough for the rugged terrain in an
off-road environment. The Hilux 4x4 models moved 0
confidently forward and recorded 42% volume 2016-17 2017-18
increase to 5,833 units compared to 4,112 units last Fortuner
year. Hilux 4x2 remains a favorite amongst fleet users,
institutional buyers, entrepreneurs and SMEs due to
Toyota Imported Vehicles - CBU Segment:
its incomparable built, durability and versatility. The
Strengthening its product portfolio to cater to the
total Hilux sales stood at all time high with 7,470 units
diverse needs of its customers, IMC introduced
compared to 5,860 units last year with an increase
Toyota’s high-end luxury sedan, the all new Camry
of 27%.
Hybrid 2018 in January 2018.
7,470 A riveting evolution in the luxury segment, the 8th
7,000
generation sedan comes with an eye-catching
5,860
6,000 design, refined interior, thrilling driving performance,
5,000 cutting-edge safety and technology features, and
No. of Vehicles
4,112 5,833
4,000 world-class fuel efficiency. The brand-new model
3,000 retains its class and excellence while providing the
2,000
customers with an enhanced level of excitement.
1,000 1,748 1,637 The Camry Hybrid is a sight to marvel with stunning
0 18inch alloy rims and a distinguished panoramic
2016-17 2017-18
Hilux 4x2 Hilux 4x4 (incl S/C 4x4)
glass roof that complements its overall structure.
With a 2.5L dynamic force engine and Toyota Hybrid
System (THS II), the remodeled Camry offers an
Toyota Fortuner - CKD SUV Segment impeccable performance simultaneously achieving
In March, Toyota Fortuner also underwent an upgrade an optimal balance between high power output and
and was launched with additional variants. The focus exemplary energy efficiency.
was to meet the varying needs of the customers and
capture the emerging SUV market in Pakistan. The new design incorporates a Human Machine
Interface accompanied by a 7-inch Multi-Information
The first variant named Fortuner Sigma-4 is introduced Display (MID), 8-inch audio display, three-mode
with an advanced, powerful and ultra-efficient 1GD drive switch (ECO/NORMAL/SPORT) as well as a

cruise control. Camry Hybrid offers an exemplary Six new dealers were added after the expansion in the
combination of extravagance and practicality with its existing network of 23 dealers. The newly introduced
style, safety and driving features, elevating the class T-Sure dealerships include:
of luxury in every sense.
• Toyota Lyallpur Motors (Faisalabad)
• Toyota Gujranwala Motors (Gujranwala)
• Toyota Royal Motors (Rahim Yar Khan)
• Toyota HN Motors (Lahore)
• Toyota Point Motors (Hyderabad)
The first hybrid luxury sedan launched by IMC. • Toyota Capital Motors (Islamabad)
Start Your Impossible

The market for the new CBU contracted from 5,547 Toyota continues its evolution as a mobility company
units to 5,320 units this year, reduced by 4%. This with its first-ever global marketing campaign, “Start
is attributed to continuous rupee devaluation and Your Impossible.” The campaign has been rolled out
increase in regulatory duties. to celebrate Toyota’s eight-year global sponsorship
of The Olympic and Paralympic Games as the first
6000
5,547
ever Mobility Partner in the history of The Olympic
5,320
5000
Partner (TOP).
4,434
“Start Your Impossible” debuts with a film entitled
No. of Vehicles
4000
4,203
3000 “Mobility for All” which features 100 real-life mobility
stories of Olympic and Paralympic athletes and other
individuals (aged 1 to 100) in every stage of life. The
2000
1000 438 185 campaign marks Toyota’s long-term commitment

0
675 912 to support the creation of a more inclusive and
2016-17 2017-18 sustainable society in which everyone can challenge
IMC CBU Sales
Competition
Toyota Direct Sales their impossible through stories of determination as
well as through Toyota technologies. Carrying out
Toyota’s legacy in Pakistan, Indus Motor Company
The Company’s sales of imported vehicles have risen selected a local athlete who fits the Start Your
by 38% in FY18 to 932 units as compared to 675 Impossible criteria. Regardless of his struggle and
units last year. Moreover, 185 units were sold directly societal challenges, IMC is providing him the platform
to customers including a large fleet order. to represent Pakistan in the 2020 Olympics.
Expansion at T-Sure Network

Indus Motor Company, the authorized distributor of
Toyota and Daihatsu in Pakistan initiated Toyota Sure
Program with the main focus to provide used car
buyers and sellers an experience on par with new
car buyers. Toyota Sure is here to facilitate Sales,
Purchase and even Exchange of any used car with a
brand new Toyota. After the third successful year of
its operations, T-Sure is in its 6th expansion phase.
70
Customer Relations
The 12TH TOYOTA DREAM CAR ART CONTEST The six member independent jury comprising
of educators, painters, curator and visual artists
This year the contest received almost 38,000 selected the regional and national winners and the
artworks from across Pakistan from over 1,140 Top 9 artworks from Pakistan to enter the World
schools, improving Pakistan’s worldwide position Contest in Japan. The Company celebrated the 38
from 6th in 2015 to the 3rd this year. winners who came from twenty-five Dealerships
across the country, awarding those certificates and
Organized annually by Toyota Motor Corporation,
medals at the grand Award Ceremony in Lahore.
the Contest, which is open to kids under 16 years,
is intended to define the future of mobility by The grand prize that awaits the top 30 winners of the
encouraging their creative expression. World Contest get a five day, all expenses paid trip to
Japan with their parents. Exposure to the Japanese
From its humble beginning in 2015 and two World
culture and its world renowned hospitality plus the
Winners, the Toyota Dream Car Art Contest has
opportunity to make new friends, has far reaching
evolved to become Pakistan’s biggest drawing
results on their mental development.
competitions for children. This year marked an over
70% increase in the number of artworks received
compared to the previous year speaking volumes of
its magnitude and reach to children from all over the
country.
One of the special features of the Local Contest is

the active participation of children who are differently
abled. The Company has created the Royal category
to encourage them, which as a result of the relentless
efforts of the Dealership Customer Relations teams
saw a 50% increase over the previous year in terms
of the number of drawings received. The artwork
of Tasmia Akram (Royal Category) from Toyota The winners of the 12th Toyota Dearm Car Art
Lyallpur Motors won the CEO Award for her dream Contest National Award Ceremony in Lahore.
car concept “The Ambulance is passing through a
narrow road”.
Tasmia Akram from Toyota Lyallpur Motors

receiving CEO award from CEO, IMC and CEO
Toyota Lyallpur Motors for her dream car concept.

Customer First – Parts & Service
The Customer First Department consolidates Parts Toyota Mother’s Day Campaign
Sales and After Sales service as a single strategic Mothers are a great source of inspiration for each
area to provide customers a complete and reliable individual. They serve as the driving force that
ownership experience throughout the life cycle ensures one recognizes and lives up to their potential
of their vehicles. A superior customer experience to achieve seemingly impossible goals.
through quality Toyota services and the availability of
genuine spare parts is disseminated throughout our With the intention to pay tribute to mothers all across
dealership network and selected retail outlets across the globe, Toyota launched a heartwarming campaign
the country. under the hashtag MyDrivingForce.
Paperless First Free Service The campaign encouraged people globally to share
All IMC customers are entitled to a free-of-cost inspiring stories of their mothers on digital platforms
maintenance service, First Free Service, once their by using #MyDrivingForce. More than 4 million people
vehicles reach the 1,000 km (600 miles) mileage were reached through this campaign with 100,000+
mark. Previously, customers would avail this service engagements. To complement this global activity, all
upon presenting a subject coupon from their vehicle’s super moms visiting Toyota Authorized Dealerships
warranty booklet to their respective Toyota dealer. for their vehicles’ maintenance were presented a free
However, to establish a hassle-free culture for our goody bag by Toyota.
valuable dealers and customers, IMC eliminated the
requirement to submit the paper coupon, easing the
process for customers to avail this service.
The initiative has been warmly welcomed by all

stakeholders and has significantly reduced the
respective workload for dealership staff. According to
dealership feedback, submission rate has increased
and dealerships are able to perform the service much
more efficiently, enhancing the customer experience.
Hailing New Grades of Toyota Motor Oil (TMO)

Complementing its existing range of superior quality
motor oil dubbed as Toyota Motor Oil (TMO), IMC has Advancing Kaizen Culture – 3rd CSKE
introduced three new grades in the 20W-50 range, Customer Satisfaction Kaizen Evolution (CSKE) is
coupled with four other grades to cater to diverse a dealership level competition that offers a platform
kinds of vehicles regardless of vehicle age or climatic to particpants to showcase their year-long Kaizen
influences. efforts and gain recognition for their commitment
The entire TMO family embraces top of the line to cultivate and sustain Kaizen culture within the
motor oil Taglon (SN 5W-50) which are eco-friendly company’s operations.
and ensure prolonged engine life. This range is This year a total of 450 Kaizen warriors participated
highly recommended for use in the first two years for in the event that featured over 150+ themes. The
gasoline vehicles. partipants gained a through understanding of the
Synthetic motor oil, Taglon is engineered to deliver Toyota Way, Toyota business practices and Kaizen
efficient results in Pakistan’s severe climate. It protects culture development.
the engine, guards against rust and corrosion and is The Grand Finale showdown of the 3rd CSKE 2018
environment-friendly which means that it lowers CO2 was held at Movenpick Hotel on May 3, 2018. The
emissions. top 14 Kaizen teams from various cities of Pakistan
convened at the event displaying enthusiasm to
present their Kaizen initiatives in After Sales, Customer
Relations, Sales and T-Sure functions of IMC.
The grand finale was an enjoyable event with more

than 150 attendees including Toyota Motor Asia
Pacific delegates, IMC’s senior management, CEOs
and Kaizen teams from IMC’s dealerships.
72
Safety, Health & Environment

The Company is committed to provide a safe and risk assessment, job safety analysis, awareness
healthy environment to all employees by strictly sessions, on job hazard identification, safety
complying with all safety, health and environment patrolling by trained members and safety walk by top
rules and regulations. Ensuring the priorities, full care management. As a result there has been no non-loss
is taken for the safety of contractors, suppliers and day injury since last six months.
all individuals in general who might be affected by
the Company’s business operations. IMC employees Safety & Environment Months
actively work to prevent accidents and injuries and Promoting Safety culture is an ongoing process
make continuous efforts to identify, eliminate and throughout the year. We celebrated a Safety Month
manage all safety risks. to encourage safety awareness in the team. Different
activities are organized for promotion of a safer
At Indus Motor Company, our Safety Policy conveys workplace and reiterating commitment to safety.
the following simple message: These activities include awareness for employees
on general safety, work at heights, machine safety,
“SAFETY WILL ALWAYS TAKE PRECEDENCE OVER fire prevention, accident investigation and process
PRODUCTION, SALES AND PROFITS” safety.
Safety Training
The Company conducts a number of general and
special training programs for employees. The general
safety training programs like firefighting, basic safety,
with simulation of Stop-6 Accident Dojo and first aid
are aimed at empowering every employee to deal
with emergency situations and avoid accidents.
While job specific training includes construction
safety, working at height, machine safety, defensive
driving and process safety. Complying with the
standards only authorized members are allowed to
perform a specific job.
IMC also conducts safety training for vendors, Training session conducted on safety
dealers and contractors to ensure that the highest management.
priority is understood at all levels.
An Environment Month is celebrated every year in
June. The purpose is to create awareness and remind
people about their social responsibility towards the
environment. Besides training and awareness, it
creates a competitive environment for employees
and their families for sustainability in society through
increased awareness.
Environmental Assessment Audit

The Environmental Assessment System (EAS) is the
Toyota system for environment management. Toyota
has developed a five year action plan and sets key
performance indicators to achieve its targets. The
6th Environmental Action Plan started in Sep 2016;
Safety training conducted in IMC training center. the Company has made remarkable achievement
in previous years and is raising the bar. To achieve
better results and to keep affiliates motivated for
Safety Record environment improvement the audit criteria is
The Company recorded a zero -loss work day made more challenging this year. The Company is
injury rating this year. This was made possible expanding its environment activities to all suppliers
through immediate improvements and a number of and dealers nationwide and focusing on ISO 14001
measures that were taken which include continuous certifications of its business partners also.

One Employee, One Plant
The Safety, Health and Environment department
initiated the “One Employee, One Tree” activity
by setting up a target of planting 10,000 trees by
involving each employee in environmental activities.
100% of IMC employees, including the CEO and
senior management planted trees to display their
commitment and ownership towards environment.
As per plan, 3100 trees were planted inside and
outside IMC while some plants were replaced by
better and fast growing species.
Emergency response training being conducted for

combating fire breakout.
5S Management System
IMC initiated the 5S audit walk to ensure safety,
quality, productivity and environmental compliance
involving all employees, including top management.
The system includes audits of the task force and top
management to develop teamwork and ownership.
IMC Management commitment for greener
IMC has improved 5S system and developed 5S
environment.
PMRs (plant management requirements) based on
5 steps. This system is maintained not only through
audits, but also by taking ownership and leading by
example.
One Employee, One Tree activity held at IMC.
Fire safety management system Team members performing 5S activity.

The Company has improved its fire prevention
system. The improvements were made through
general and specific training programs accompanied
by classroom, practical session, examination,
evacuation mock drills and firefighting training. Fire
risk assessment audits have also been done by
internal and external expert auditors.
It has been made mandatory for all high risk jobs to

first make a fire safety analysis. This includes analysis
of equipment, method, environment and safety
precautions. Safety compliance during the job is
maintained through safety patrols. All systems work
with a high commitment of the top management
through audit walks and continuous follow up in daily
meetings.
74
Human Resource
Indus Motor likes to make its employees feel special
IMC recognizes the significance of Human Resource. and hence introduced a unique birthday celebration
It focuses on acquiring the best talent and developing tradition for its members. Twice every month, everyone
people to steer the Company to success. To gathers in the cafeteria to celebrate their colleagues’
accomplish customer delight, it aspires to have the birthdays and interact with the top management.
right people in the right place at the right time. Its Every month, two Sundays are dedicated for movie
HR function is aligned towards developing human shows where employees and their families enjoy
capacity to support business growth. quality time.
Diversity and Inclusion

IMC is committed to affirmative action in support of
equal opportunity employment and engagement of
women in the workforce. The ratio of female employees
has increased from last year and is now 10% of the
total management employees and is expected to
increase over the years. A Gender Diversity Session
was held to explore ideas for improving workspace
for females and to retain current female employees.
Ladies Day Out activity was also organized for the
ladies of IMC to spend a day together reveling in fun
activities.
IMC’s unique tradition of birthday celebration for
its members.
Family Day at IMC is a cherished event in the annual

calendar that all employees and families excitedly
look forward to. This year the event took place at
PAF Museum, where it attracted over 7000 people
for an evening packed with joy and entertainment.
The efforts of the employees were recognized by
presenting the Long Service Award to those who
have been part of the IMC Family for over 25 years.
The ladies of IMC spent the day together reveling

in fun activities.
Employee Engagement
To challenge the physical and mental skill set of
employees, a football tournament was held which
lasted for over three months. More than 300
employees participated in the competition. This
competition further helped in improving team work
and team building.
The IMC’’s Family Day 2018 took place at PAF
Museum.
Strengthening the Capacity

Like every year, our team members attended different
programs at leading institutions such as INSEAD,
London Business School, LUMS, IBA, KSBL and
Franklin Covey to stay on the top of the business.
IMC believes in providing advance training and
international exposure to its employees. As a result,
eighteen employees from different departments went
as Intra-Company Transferees to Singapore, Thailand
The IMC football tournament kick-off in full swing. and Japan.
During the year, employees from the Corporate, We aim to have the best talent with the best skills. We
Supply Chain, Product Development and Marketing conduct various in-house trainings to improve skills
functions successfully acquired certifications in and mindsets of people to get them ready to face
Toyota Global Programs, adding to the base of new challenges and to enhance their ability to deliver
Toyota certified professionals. This continued the customer delight in their own respective areas.
company tradition of sharing its best practices. The
newly certified trainers are now part of the talent pool, To promote the spirit of learning, IMC regularly
lending support and advice on critical matters. recruits batches of Trainee Apprentices under the
ATM program and transforms them into talented
During the year, Senior Management staff was taken technicians through an intensive training and
through the Leadership Xpedition program. They development program.
learnt leadership competencies through 7 Dimensions
Leadership Model and played a role in developing a Attracting the Best
culture of high-performance achievement. The Company has undertaken several campus
recruitment drives for Management Trainee and
Trainee Engineers. After the rigorous process of
finding the best talent, twenty seven new trainees
from the most well reputed educational institutions of
Pakistan such as LUMS, GIK, IBA, NUST and NED
made their way to IMC. Our aim is to recruit the best
talent. An HR portal has been developed. It can be
reached at www.toyota-indus.com where candidates
can register themselves online here with their CVs for
possible selection.
Leadership Xpedition training camp led by training

impact to enhance leadership and team building
skills.
76
Operations
TMC Appreciation towards Quality Improvement
and Dedicated Quality Month
TMC/TDEM top management is keenly looking into
IMC progress on quality improvement. In continuation,
Mr. Takami (TDEM President) & Mr.Ninoyu (MO TMC
Motomachi) visited IMC this year and appreciated the
progress made by IMC in short span of time towards
quality activities. Annual shipping quality audit was
conducted by TDEM auditors in which IMC achieved
very good results.
This year Quality month was celebrated with key

message ‘’Challenge to reform our work towards
customer expectations’’. The guidelines and activities Ninoyu San (MO Motomachi QC) Visit to IMC.
of Quality month including the CEO message, Quality
month video watch and Quality exhibition (display
of departmental efforts on market issues towards Asia Pacific Skill Contest
customer satisfaction through simulators and An annual competition for Toyota, Asia Pacific Skill
problem explanation), were in line with TMC/TDEM. Contest convenes participants from 12 Toyota
In addition to above activities and appreciation,IMC affiliated companies from 8 countries in Asia Pacific.
received the Warranty reduction award for achieving Year 2017 contest, held in Thailand attracted at
the TDEM Annual target of Warranty. least 164 contestants, including IMC members who
displayed their skills and talents on the international
platform. The competing IMC teams bagged four
medals this year, including: In the category of Team
Leaders: The Silver Medal was won by Hazrat Bilal
of Assembly Shop and Bronze medals secured by
Zeeshan Mehmood from Weld Shop and Sami Ullah
from Paint Shop. In the Team Member Category,
Ather Mirza from Paint Shop earned the Bronze
medal.
Team leader is explaining to Top management

about market issues in Quality exhibition.
This year in Asia Pacific Skill Contest IMC won four

medals.
Localization
On a quest to enrich the nation’s auto industry, Indus
Motor Company is actively involved in endeavors
focused on increasing the use of local parts in its
vehicles. The company takes pride in excelling at this
function and continues to further cement efforts in
this direction.
Participants Group photo with Sr Director technical With the aim of continually raising the bar on product
during Quality Exhibition in IMC. quality, the company strives to maintain and uphold

Toyota’s exemplary business practices and assure internationally held environmental standards. In our
the same level of quality that is associated with the supplier network, 33 out of 45 suppliers are ISO
brand. Our ambition is to deliver quality beyond the 14001 certified while the rest are aiming to achieve
expected standard in a way that it is beneficial for our this target. Moreover, a new environmentally-friendly
products, but more importantly for the expansion of program has been developed at IMC that monitors
Pakistan’s supplier base. and aims to reduce carbon emissions within its
network of operations.
Being a responsible corporate entity, IMC encourages
its suppliers to establish environmental management
systems focused on developing an entirely green
supply chain. In this spirit, we employ Toyota’s
Green Purchasing Guidelines across our local
suppliers operations that guarantee compliance to
78
Information Technology
Digital Imperative RFID Implementation
In an effort to improve process efficiency, IMC has
IT Strategy based on Offense and Defense Mindset taken several initiatives that focuses on enhancing
In the midst of all the digital disruption, it is not visibility and integrity of process data. RFID
uncommon for an Organization to find itself in a implementation is one such initiative. RFID tags
state of ‘Excited Confusion’ not sure about which are placed on the vehicle and are tracked by RFID
Technology to adopt and which ones to let go. Readers placed at strategic locations throughout
Realizing the need for alignment of IT strategy with the plant and dealerships. This has provided variety
Business Objectives while minimizing the risk of of data sets for process improvement Kaizen. RFID
stifling innovation, IMC IT has adopted a strategy initiative has provided a solid platform for IMC to
based on Offense and a Defense mindset. Defense further strengthen internal controls in future.
part of IMC IT Strategy aims at optimizing Business
by focusing on initiatives that improves efficiency, Infrastructure Upgrade
quality while reducing cost. The offense part of IT In order to facilitate Product Development and
Strategy focusses on differentiating Business through Production Engineering functions of IMC, Toyota
innovation and smart adoption of digital technologies Global Network (TGN) infrastructure has been
for improving quality of services and providing upgraded. This has allowed IMC to access Global
superior customer experience. systems within Toyota World in a much more efficient
manner. Similarly, in order to leverage Cloud based
Key Initiatives service offerings, internet capacity was enhanced
with built-in design redundancies. Wireless LAN
Genesis Gains Traction Coverage has been increased across IMC with the
Genesis Business portal was originally launched focus on providing high-speed and secure internet
in 2016 with the main objective of automating access to internal customers.
Business interaction between IMC and its network
of dealerships across Pakistan. Staying true to the Information Security
values of Toyota Production System (TPS), several Information Security function has gained significant
Kaizens have been made throughout last year which prominence in the wake of ever-increasing cyber
resulted in gaining efficiencies in the areas of Voice threats. In order to ensure Confidentiality, Integrity and
of the Customer (VOC), Dealer Technical Report Availability (CIA) of the enterprise data there needs to
(DTR) processing, Pre-Delivery Service (PDS) and be a constant focus on improving IT Security policies
First Free Service (FFS) processing. Moreover, the and procedures. In the current year, IMC IT Security
entire Warranty claims process (including Extended policy was modified to counter potential threats. IT
Warranty) has been automated through Genesis. This System Access procedures were also improved to
has resulted in countless man-hour savings while ensure adequacy of Physical and Logical controls. In
improving the integrity of data. The Warranty portal addition, as comprehensive BCP and DR Plan was
was also presented at Toyota Regional Conference developed to ensure continuity of operations.
in Thailand and was recognized as one of the best
Kaizen from IMC. Industry 4.0 – Artificial Intelligence and Machine
Learning
S/4 HANA Optimization Data is quite pervasive. According to a research,
IMC implemented SAP S/4 HANA in 2016, being 95% of World’s inhabitable land-mass is connected
the first organization to have gone live with real-time with some form of Wireless or cellular connectivity.
data analytics capability provided by inherent SAP We are not only consuming data but are also
FIORI user interface. IMC SAP team in conjunction producing data. According to one estimate, by 2020
with Supply chain and support functions have further every human being will be producing 1.7MB of data
improved the effectiveness of SAP through meaningful per second. With Industry 4.0 it is now possible
application of controls and purposeful automation. to collect, analyze data and subsequently take
This has resulted in considerable cost savings while intelligent actions based on Artificial Intelligence and
improving the efficiency and quality of service. In Machine Learning. Staying ahead of the curve, IMC
addition, Business Warehouse capabilities were has started several Proof of Concepts (POC) with the
enhanced through additional reporting including but aim to provide meaningful insights to operational and
not limited to inventory-ageing and Business KPI strategic decision makers. This has the potential to
trend analysis. dramatically reduce fixed cost and improve quality
and efficiency of operations.

Technology Driven Customer Experience Awards and Accomplishments
In order to enable Sales and Marketing, Customer Project of the Year Award for SAP S/4 HANA
First and Customer Relations department of IMC, implementation at Indus Motor Company by Project
with the end goal of providing delightful experience to Management Institute Genesis Recognized at Toyota
our customers, IMC IT has developed and upgraded Regional Conference
several software applications. New features were
added to Toyota Mobile App such as warranty 5K Customer Service Kaizen Evolution Award by
activation and Dealer appointment facility. BLISS App TDEM for Customer retention Dashboard
was launched to improve the efficiency of Dealership
Sales staff. Similarly a Facility Audit App was launched Future Outlook
to enhance the efficiency of Dealership Audits and Customer delight lies at the center of IMC’s IT Strategy.
eliminate manual paperwork and processing. On the We will continue to build on the momentum that
Sales process front, PBO Application for Sales order has been achieved on Digital Transformation front.
booking was also improved with some crucial back- Toyota Vision 2025 talks about achieving ‘4Most’ in
end integrations with SAP. On the supplier front, Business and contributing to Society as ‘The Best
eProcurement Application was also upgraded with in Town’ company. IMC IT will be a key enabler for
a new Business intelligence Dashboard for better achieving this vision of being the company with Most
monitoring of order fulfillment KPIs Customers, Most Profitable, Most Competitive and
Most Innovative.
Green Printing
IMC IT introduced an environment friendly Kaizen with
the aim to reduce use of paper and increase security of
confidential data. Using RFID technology, employees
can now print documents at any printer across IMC
after scanning of their Employee identification card.
This has dramatically reduced paper wastage
80
Corporate Social Responsibility

Advancing Concern Beyond Cars
IMC’s approach to Corporate Social Responsibility Community Uplifting Program
(CSR) and Sustainability focuses on conducting Adhering to the corporate responsibility principle,
business in a responsible manner, creating value for IMC strives to make a positive contribution to the
stakeholders and society, and contributing to the down trodden communities in which it operates and
community, sustainable development at large. invests in health and education program that aims
to bring sustainable improvement to economically
Indus Motor Company has always put CSR at the marginalized people. Under its well institutionalized
forefront of its responsibilities. Hence, during the last “Community Uplifting Program” for its neighbor
five years it has made such tremendous headway in community, there are multiple ongoing activities.
the areas of Education, Health, Community Services, Towards transformative power of education, around
Road Safety, Environment as well as response to 250 children are taken to school for their primary and
Natural Calamities. To bolster its humanitarian efforts, secondary education providing full financial support.
the company has a dedicated policy that allocates Through arranging Free Medical Camps weekly at
1% of profit before tax of the previous year for its three locations around 30,000 patients are treated
annual CSR spending. A total amount of Rs 192 in 2017-18. For the social inclusion of people with
million was spent on social contribution during 2017- mental illness or epilepsy, monthly two free medical
18, whereas IMC has spent over Rs 1 billion since its camps are functioning under collaboration of
inception. Basic Needs Pakistan. Besides medical facility, the
camp was also aimed to educate local populace
Aiding towards socio-economic improvement, IMC
on personal health, hygiene, children health care,
upholds its responsibility to follow the ten principles
preventions of diseases and sanitation of living areas.
of United Nation’s Global Compact, which underline
The parents were also advised on curable diseases
integral practices in the areas of Human Rights, Labor,
of children and women counseled on mother /child
Environment, and Anti-corruption. IMC is committed
health related matters. The camp received massive
to uphold and advance United Nations’ Sustainability
response from the local community and was highly
Development Goals (SDGs) via a dynamic range
appreciated by the local civil society.
of activities and projects. In recognition of its best
practices in embracing SDGs and integrating the In addition, under its weekly cooked Food Distribution
ten principles of UNGC, IMC has been conferred around 20,000 people were fed during the year,
the “Business Sustainability Award 2017” having the whereas during the holy month Ramazan, more 400
honor of the 1st prize in the category of multinational families were provided ration package.
companies for the second year in a row.
Education, being a catalyst for transformation of
We, at IMC dedicated to reshaping the social
society
environment within our network of operations and
To boost the nation’s capacity development, IMC
encourage cross-cultural dialogue. Our focus is two-
has invested heavily in a number of educational
fold, one directed at fields of action extending our
ventures, including a contribution to the Habib
role as a “Good Neighbor” and the other involving
University Foundation and The Citizens Foundation
projects that advance our specific technical expertise
(TCF). During this year, IMC provided an additional
as an assembler of Toyota’s vehicles. As a recurrent
Endowment Fund, worth Rs 22 million, again
practice, we motivate our employees to partake in
towards one of TCF’s Campus nestled in Orangi
social welfare projects.
Town, Karachi. Apart from this, IMC contributed
Major CSR initiatives undertaken in 2017-18 to drive Rs 5.20 million towards annual operational cost of
societal transformation comprise: two School Campuses of TCF, located in Hyderabad
and Muzaffargarh sponsored by IMC

Tree Plantation Drive
As a responsible corporate entity, IMC understands
the critical need to emphasize environmentally-
friendly practices to address climate change and
minimize the range of negative effects on ecosystems.
With this view, IMC carved out a plan under its Tree
Plantation Drive to plant a total of 10,000 trees
within its facilities. IMC employees welcomed the
opportunity and lent a helping hand to achieve the
target. To complement this undertaking, IMC also
planted mangrove trees along Karachi beach, in
association with WWF-Pakistan.
Shell Eco Marathon

Supporting the country’s exceptional young talent
to engage in creative platforms advancing technical
expertise, IMC extends full financial support to
groups of university students seeking participation
in international automotive design competitions.
This year, IMC sponsored a cohort of engineering
students “Team Toyota Nustag” belonging to The
College of Electrical and Mechanical Engineering,
National University of Sciences and Technology
(NUST) Pakistan to prove their mark at the Shell Eco
Marathon 2018, an international collegiate race car
design competition focused on ultimate-energy- Solar lamp provision in Baluchistan
efficiency. As many as 122 student teams from 18 Embracing the spirit of community welfare, IMC
countries came head-to-head in the competition. supported the Health Education Livelihood Promoters
Team Toyota Nustag shined out with their (HELP) Baluchistan to provide solar lamps to families
performance, becoming the first team to successfully of coal mine workers belonging to the Sor Range
clear the technical inspection and securing the 11th district of Baluchistan. Volunteers from one of the
position in the category of Gasoline and 15th position IMC’s dealers, Toyota Zarghoon Motors in Quetta,
in the category of Urban Concept. In the prior year, welcomed the prospect of working hand-in-hand
IMC sponsored a student team from Ghulam Ishaq with the HELP team to distribution the solar lamps, in
Khan Institute (GIKI) which presented their prototype an effort to alleviate the suffering of the mine workers
fuel-efficient car at the Shell-Eco Marathon 2017. and enhance their quality of life.
82
Clean up Campaign 2018 offering three-year certification under Toyota –

Under its CSR program, IMC this year launched the Technical Education Program (T-TEP). This program
‘Clean Karachi Campaign’. One of the objectives of is conducted through four institutes in three major
the drive was to keep the city clean and green and cities. It offers students a chance to strive for a
also to share 5S principles of Toyota with citizens of successful career and live up to their true potential,
Karachi so that everyone could take ownership of their ensuring a better standard of living for their families
environment. Nurturing the sense of responsibility, and coming generations. Toyota philosophy and
proprietorship and solidarity, the activity empowered methods are the cornerstone of this program.
the city’s youth and community members to play Every year, 600 graduates are enrolled, who get
an active role in keeping the city clean and smear- employment opportunities both within Pakistan and
free. During the cleanliness drive, specially designed abroad. So far, IMC has trained 56 instructors who in
waste containers were kept at sports and educational turn have taught 4,397 students. T-TEP has resulted
organizations, while large dumping bins were placed in the availability of skilled workforce for the industry
in communities. The mega cleanliness drive lasted and has succeeded in creating social and economic
almost 3 months. value for the society.
Commitment to the future

Since its inception, IMC has undertaken dedicated
efforts to foster societal development and continues
to do so with a range of activities aimed at benefitting
the community at large. The company is committed
to follow Toyota’s vision and UN’s SDGs and guiding
principles to ensure a greener future buttressed by its
social responsibility initiatives.
Besides this, more than 150 employees voluntarily

came forward and took the responsibility to clear the
National Stadium after the 3rd T20 match between
Pakistan and West Indies. This initiative was taken to
portray the positive image of the city.
Toyota – Technical Education Program

To develop skills and expertise of younger generation
in the field of automotive engineering, IMC, with
the support of Toyota Motor Corporation, has been

Corporate Matters & Related Disclosures
Composition of the Board
The composition of the Board of Directors of the Company as at June 30, 2018 is as follows.
1. The total number of directors are 10 as per the following:

a. Male 10
b. Female -
2. The number of directors under respective categories are as follows:

a) Independent Director 01
b) Non-Executive Directors 06
c) Executive Directors 03
As per the Listed Companies (Code of Corporate Governance) Regulations 2017, “the Code”, the Board is
required to have a female director and 1/3rd independent directors, not later than the expiry of the current term
i.e. by October 31, 2020.
Board of Directors Meetings

A total of Five (05) meetings of the Board of Directors were held during 12 month period from July 01, 2017
to June 30, 2018. Name of the directors (at any time during the year) alongwith their attendance at the Board
Meetings is as follows.
S. Meetings
Name of Directors
No. Attended
1 Mr. Ali S. Habib (Chairman) 5
2 Mr. Yuji Takarada / Toshiya Azuma (Ex Vice Chairman & Director) 5
3 Mr. Ali Asghar Jamali (CEO) 5
4 Mr. Sadatoshi Kashihara (Senior Director Manufacturing) 5
Mr. Susumu Matsuda [Mr. Tsuyoshi Haginiwa, Alternate Director] /
5 5
Mr. Hiroyuki Fukui, Ex-Director [Mr. Yoshihide Tokuda, Ex Alternate Director]
6 Mr. Tetsuya Ezumi / Mr. Masato Yamanami, Ex-Director [Mr. K. Sotowa, Alternate] 5
7 Mr. Mohamedali R. Habib 4
8 Mr. Farhad Zulficar 4
9 Mr. Azam Faruque 4
10 Mr. Parvez Ghias 5
Changes in Directors
During the year, 3 casual vacancies occurred on the Board. Mr. Toshiya Azuma resigned as Vice Chairman &
Director with effect from January 1, 2018 and Mr. Yuji Takarada was appointed as Vice Chairman & Director
from same date. Mr. Hiroyuki Fukui resigned as Director with effect from January 25, 2018 and Mr. Susumu
Matsuda was appointed as Director with effect from February 7, 2018. Furthermore, Mr. Masato Yamanami
resigned as Director with effect from May 28, 2018 and Mr. Tetsuya Ezumi was appointed as Director from the
same date.
The Board acknowledged the valuable contributions made by the outgoing Directors and welcomed the new
Directors on the Board.
84
Committees of the Board Company in an orderly manner, safeguard its assets

The Board has formed the following Committees and and secure the accuracy and reliability if its records.
details of members is as under: The Management supervision and reviews are an
essential element of the system of internal controls.
1. Board Audit Committee
The Management has delegated the function of
1) Mr. Azam Faruque, Chairman of the
detailed examination and special review to the team
Committee
of internal auditors.
2) Mr. Mohamedali R. Habib
3) Mr. Farhad Zulficar
The Board ensures adequacy of internal control
4) Mr. Parvez Ghias
activities either directly or through its Committees.
5) Mr. Susumu Matsuda
The Board also reviews the Company’s financial
6) Mr. Tetsuya Ezumi
operations and position at regular intervals by means
2. Board Human Resource & Remuneration of interim accounts, reports, profitability reviews and
Committee other financial and statistical information. Analysis of
1) Mr. Azam Faruque, Chairman of the budgetary control is in place and the Board reviews
Committee material variances with explanations and actions
2) Mr. Ali S. Habib taken thereon on periodic basis.
3) Mr. Yuji Takarada
4) Mr. Parvez Ghias Risk management
5) Mr. Ali Asghar Jamali IMC has formal risk management framework to
assess the risks faced in the context of the broader
3. Board Ethics Committee political and macroeconomic environment. The risk
1) Mr. Farhad Zulficar, Chairman of the management system identifies strategic, regulatory,
Committee financial, operational, reputational, and sustainability
2) Mr. Parvez Ghias risks related to IMC business activities. The risks
3) Mr. Ali Asghar Jamali are reviewed by management committee along with
departmental objectives, targets and performance.
Salient features of Remuneration policy for Appropriate strategies are developed and
Non-Executive Directors implemented to minimize the impact of the identified
The Board acknowledge the valuable contributions risks.
being made by the Non-Executive directors, and
currently a meeting fee is being offered for attendance The Company has also formulated a risk management
and participation at each Board meeting or its structure based on the global practice followed by
Committee, while this does not reflects compensation Toyota, with the aim of driving the Company strength
of their contributions and just represents a token of growth with managing risk associated with business
appreciation. The Non-Executive directors may waive adequately.
their rights to receive such remuneration for attending
and participation in the above meetings. Financial Statements
International Financial Reporting Standards (IFRS),
Principal Risk and Uncertainties as applicable in Pakistan and provisions of and
Despite the fact that the Company’s financial directives issued under the Companies Act, 2017
performance is exceptional from the past years, have been followed in preparation of the financial
however, continuous depreciation of Pak Rupee statements, where provisions of and directives issued
against various currencies, general inflation and under the Companies Act, 2017 differ from the IFRS,
rise in international commodity prices will be vital the provisions of and directives issued under the
factors that may have an impact on the future Companies Act, 2017 have been followed.
financial statements of the Company. The company
welcomes new competition, however, consistent The auditors of the company, M/s A.F. Ferguson &
Government policies are required alongwith creating Co., Chartered Accountants, audited the financial
a level playing field for the existing players of the statements of the Company and have issued an
industry for sustainable growth. unqualified report to the members.
Internal Control Pattern of Shareholding

The Company has employed an effective system The Pattern of Shareholding of the Company as at
of internal controls to carry on the business of the June 30, 2018, is given on pages 151 to 153.

Trading of Shares of the Company Chairman’s Review
During the year ended June 30, 2018, the Directors, The Directors of the company endorse the contents
the Executives, and their spouses and minor children of the Chairman’s review, dealing with the overall
have not carried out any trading of shares of the performance of the Company, future outlook and
Company. The Executive includes, Chief Financial report on the performance and effectiveness of the
Officer, Company Secretary, and Head of Internal Board.
Audit for the purposes of disclosure of trading of
shares. Moving Forward
Future Moving forward, your Company plans to
Material Changes and Commitments secure new and exciting products from Toyota that
The Board of Directors have approved an amount will further strengthen the existing product slate to
of Rs. 3.3 Billion for capital expenditure, to increase provide a wider choice to customers and ensure
the manufacturing productivity, which will enhance sustainable growth and value creation.
the annual normal vehicle production capacity to
around 76,000 units, on double shift basis, based After the formation of the newly elected government,
on average normal working hours in a financial year. we anticipate that policies are to be made to
The investment is planned to be made in various overcome the economic challenges. Initiatives to be
production areas to debottleneck and improve taken to increase investments and localization.
efficiency and productivity, which will yield benefits
during the financial year 2020-2021. Acknowledgement
We are grateful to our customers for their continued
No other material changes and commitment affecting patronage of our products and wish to acknowledge
the financial position of the Company have occurred the efforts of the entire Indus team, including our
between the end of the financial year of the Company staff, vendors, dealers and all business partners for
to which the balance sheet relates and the date of their untiring efforts in these challenging times and
the report, other than disclosed in the Financial look to their continued support.
statements, or in this report.
We bow to the Almighty and pray for His blessings
Appointment of Auditors and guidance.
The existing auditors, M/s A.F. Ferguson & Co.,
Chartered Accountant retire and being eligible, Karachi.
offer themselves for re-appointment. The Directors August 28, 2018
endorse the recommendation of the Audit Committee
for re-appointment of A.F Ferguson & Co, as the
auditors for the year ending June 30, 2019.
Related Party Transactions

All transactions with related parties have been
executed at arm’s length and have been disclosed in
the financial statements under relevant notes.
Key Operating and Financial Data

The Key Operating and Financial Data is mentioned
on pages 154 to 155 of the Annual Report.
Ali Asghar Jamali Yuji Takarada
Statement of Compliance with COCG Chief Executive Vice Chairman
The Company has fully complied with requirements
of the Listed Companies (Code of Corporate
Governance) Regulations 2017. Statement to this
effect is annexed with this Report on page 95 & 97.
86
Global Vision for Those We Serve

Defining the ideal form of the company for each stakeholder and the outline for
the future it should take in order to realize the Global Vision
We aim to exceed expectations and be rewarded with a smile. We will meet challenging goals by engaging the
talent and passion of people, who believe there is always a better way” as we set out in the Global Vision. That
means, we will sincerely listen to the voices of every stakeholder - customers, employees, business partners,
shareholders, and global society/local communities, and respond to those expectations. The expression
“Global Vision for Those We Serve” is our way of organizing and explaining the thoughts constituting the Global
Vision in relation to stakeholders. It is Toyota’s resolve to meet challenging goals step by step to see the smiles
and happiness of everyone including customers and beyond.
Customers Shareholders
Provide safe and reliable vehicles that inspire Ensure sustainable growth by fostering the virtuous
enthusiasm at affordable prices. Listen sincerely to circle;
customer voices and continue to reinvent ourselves o Always better cars
through sufficient information disclosure and o Enriching lives of communities
dialogue. o Stable base of business.
Employees Business Partners

Create working environments for various employees Contribute for economic development of local
to work proudly and with loyalty and confidence communities with open stance to new suppliers
in fulfilling their potential, which realize their self- and dealers and through sustainable growth based
growth. on mutually beneficial business relationshipswith
dealers/distributors and suppliers.
Global Society/Local Communities

Reduce environmental burdens through lifecycle
by developing various eco-friendly vehicles and
technologies and making them prevail. As a good
corporate citizen, respect the culture and customs of
every nation and contribute to social development.
Be aware of responsibilities of developing and
producing vehicles and contribute for realization of
new mobility society free from traffic accidents and
congestion.

Fun Facts & Tips for Safety
88
YOU NEVER DRIVE ALONE

Even if you are alone in the car, you’re still responsible for more lives than you
think. That’s because the safety of other road users are in your hands every time
you’re behind the wheel.
SAFETY MULTIPLIER
There’s a very simple way to enhance the effectiveness of airbags by 15 times-
WEAR YOUR SEATBELT.
S IS FOR SAFETY
Keeping your child safe during a car ride is easy as ABC. Just put your child in a
child safety seat. This can reduce the risk of fatality by 71% for infants and 54%
for toddlers aged 1 to 4 years.
AIRBAG SPEED 200MPH

The only thing that should be speeding is your airbag. Deployed
at speeds of up to 200mph in 0.2 seconds, the airbag provides
protection between you and the steering wheel, dashboard or
windshield.
AIRBAGS ENDANGER CHILDREN

Children aged 12 and under should always ride in the rear
because the explosive force used to deploy an airbag can be
fatal to young children. For the same reason, a rear-facing car
seat for infants and toddlers should not be placed in front of an
airbag.
SAVED BY A SEATBELT
100,000 - that’s the average number of people saved by seatbelts
every year.

SAFETY FEATURES TO KNOW
ISOFIX CHILD SEAT ANCHORS
ISOFIX child seat anchors allow you to fit a car seat directly into a
vehicle without using a seatbelt. It is used for the safety of children so
that child seat is installed properly.a regular basis.
VSC (VEHICLE STABILITY CONTROL)

VSC helps suppress vehicle lateral skidding when cornering or during
emergency steering maneuvers for excellent handling and stable
performance.
GOA BODY WITH REINFORCEMENT

GOA (Global Outstanding Assessment) is collision safety body
consisting of an impact absorbing body structure and high integrity
cabin. In the case of a crash, the GOA body helps in minimizing cabin
deformation.
DUAL SRS AIRBAGS

The SRS (Supplemental Restraint System) airbags inflate when the
vehicle is subjected to certain types of severe impacts that may cause
significant injury to the occupants. They work together with the seat
belts to help reduce the risk of death or serious injury. They can help
protect the head and chest of the driver and front passenger from
impact with interior components. SRS front airbags do not generally
inflate if the vehicle is involved in a side or rear collision, if it rolls over,
or if it is involved in a low-speed frontal collision.
SEATBELT: PRETENSIONER WITH

FORCE LIMITER & ELR
The pretensioners help the seatbelts to quickly restrain the occupants
by retracting the seatbelts when vehicle is subjected to certain types
of severe frontal collision. Force limiters mitigate the impact applied to
the chest, thus contributing to achieving excellent occupant restraint
performance.minimizing cabin deformation.
ABS AND EBD

Anti-lock Braking System (ABS) helps to prevent the wheels from
locking up and skidding during hard braking, allowing you to retain
steering control. Electronic Brake Distribution (EBD) ensures brake-
force is distributed optimally between all wheels for effective braking.
90
GAINING
Recognition
This year IMC won substantial awards in different categories:
1. 4 medals, at “Asia Pacific Skill Contest 2018” in Thailand.
2. 33rd Management Association of Pakistan’s (MAP) Corporate Excellence

Award in the “Industrial Category” for demonstrating excellence in corporate
management.
3. PAS award for Fortuner in the automotive and transportation category
4. Best CEO of the year award.
5. Business Sustainability Award from United Nation Global Compact (UNGC)

Pakistan Network.
6. Consumer Choice Award for GLi and Revo.

FINANCIAL
STATEMENTS
Statement of Compliance
with the Code of Corporate Governance
This statement is being presented to comply with the Code of Corporate Governance contained in Regulation
No. 5.19 of listing regulations of Pakistan Stock Exchange Limited (the Code) for the period from July 1,
2017 to December 31, 2017 and the requirements of the Listed Companies (Code of Corporate Governance)
Regulations, 2017 (the Regulations) for the period from January 1, 2018 to June 30, 2018 for the purpose of
establishing a framework of good governance.
The Company has complied with the requirements of the Code and the Regulations in the following manner:
1. The total number of directors are 10 as per the following:
a. Male 10
b. Female -
2. At the year ended June 30, 2018, the composition of the Board of Directors (the Board) is as follows:
a) Independent Director
1. Mr. Azam Faruque Director
b) Non-Executive Directors
2. Mr. Ali S. Habib Chairman
3. Mr. Farhad Zulficar Director
4. Mr. Mohamedali R. Habib Director
5. Mr. Susumu Matsuda Director
6. Mr. Tetsuya Ezumi Director
7. Mr. Parvez Ghias Director
c) Executive Directors
8. Mr. Yuji Takarada Vice Chairman

9. Mr. Ali Asghar Jamali Chief Executive
10. Mr. Sadatoshi Kashihara Sr. Director Manufacturing
The independent director meets the criteria of independence under the Companies Act, 2017.
3. The directors have confirmed that none of them is serving as a director on more than five listed companies,
including this Company (excluding the listed subsidiaries of listed holding companies where applicable).
4. The Company has prepared a Code of Conduct and has ensured that appropriate steps have been taken
to disseminate it throughout the Company along with its supporting policies and procedures.
5. The Board has developed a vision/mission statement, overall corporate strategy and significant policies of
the Company. A complete record of particulars of significant policies along with the dates on which they
were approved or amended has been maintained.
6. All the powers of the Board have been duly exercised and decisions on relevant matters have been taken
by the Board / shareholders as empowered by the relevant provisions of the Companies Act, 2017 (the
Act), the Code and the Regulations.
7. The meetings of the Board were presided over by the Chairman and, in his absence, by a director elected
by the Board for this purpose. The Board has complied with the requirements of the Act, the Code and
the Regulations with respect to frequency, recording and circulating minutes of the meeting of the Board.

8. The Board has a formal policy and transparent procedures for remuneration of directors in accordance
with the Act, the Code and the Regulations.
9. As at June 30, 2018, three directors namely; Mr. Parvez Ghias, Mr. Mohamedali R. Habib and Mr. Azam
Faruque have acquired the prescribed certification under the Directors’ Training Program (DTP) and two
directors namely; Mr. Ali S. Habib and Mr. Farhad Zulficar have received approval from the Securities and
Exchange Commission of Pakistan, against exemption from the requirement of DTP.
10. The Board has approved appointment of the Chief Financial Officer (CFO), Company Secretary and Head
of Internal Audit, including their remuneration and terms and conditions of employment and complied with
relevant requirements of the Code and the Regulations.
11. The CFO and Chief Executive Officer (CEO) have duly endorsed the financial statements before approval
of the Board.
12. The Board has formed Committees comprising of members given below:
a) Audit Committee
Mr. Azam Faruque Chairman of the Committee
Mr. Farhad Zulficar Member
Mr. Mohamedali R. Habib Member
Mr. Susumu Matsuda Member
Mr. Tetsuya Ezumi Member
Mr. Parvez Ghias Member
b) HR & Remuneration Committee
Mr. Azam Faruque Chairman of the Committee
Mr. Ali S. Habib Member
Mr. Yuji Takarada Member
Mr. Ali Asghar Jamali Member
Mr. Parvez Ghias Member
13. The terms of reference of the aforesaid committees have been formed, documented and advised to the
committees for compliance.
14. The frequency of meetings of the committees during the year was as per the following:
• Board Audit Committee Quarterly meetings
• Board HR & Remuneration Committee Half yearly meetings
15. The Board has set up an effective internal audit function who is considered suitably qualified and experienced
for the purpose and is conversant with the policies and procedures of the Company.
16. The statutory auditors of the company have confirmed that they have been given a satisfactory rating
under the quality control review program of the Institute of Chartered Accountants of Pakistan (ICAP) and
registered with the Audit Oversight Board of Pakistan, that they or any of the partners of the firm, their
spouses and minor children do not hold shares of the Company and that the firm and all its partners are
in compliance with International Federation of Accountants (IFAC) guidelines on code of ethics as adopted
by the ICAP.
17. The statutory auditors or the persons associated with them have not been appointed to provide other
services except in accordance with the Act, the Code, the Regulations or any other regulatory requirement
and the auditors have confirmed that they have observed IFAC guidelines in this regard.
96
18. All the resident directors of the Company are registered as taxpayers and none of them has defaulted in
payment of any loan to a banking company, a DFI or an NBFI or, being a broker of a stock exchange, has
been declared as a defaulter by that stock exchange.
19. During the year, three vacancies occurred on the Board that were filled up by the directors within the
prescribed number of days.
20. The directors’ report for this year has been prepared in accordance with the requirements of the Act and
the Regulations.
21. The directors, CEO and executives do not hold any interest in the shares of the Company other than that
disclosed in the pattern of shareholding.
22. The Company has complied with all the corporate and financial reporting requirements of the Code and
the Regulations.
23. The ‘closed period’, prior to the announcement of interim / final results, and business decisions, which
may materially affect the market price of the Company’s securities, was determined and intimated to
directors, employees and the Pakistan Stock Exchange Limited.
24. Material / price sensitive information has been disseminated among all market participants at once through
the Pakistan Stock Exchange Limited.
25. The Company has complied with the requirements relating to maintenance of register of persons having
access to inside information by designated senior management officer in a timely manner and maintained
proper record including basis for inclusion or exclusion of names of persons from the said list.
26. We confirm that all other requirements of the Code and the Regulations have been complied with.
Ali S. Habib
Chairman
Karachi
August 28, 2018

INDEPENDENT AUDITOR’S REVIEW REPORT TO THE MEMBERS OF
INDUS MOTOR COMPANY LIMITED
Review Report on the Statement of Compliance contained in Listed Companies (Code of Corporate
Governance) Regulations, 2017.
We have reviewed the enclosed Statement of Compliance with the Listed Companies (Code of Corporate
Governance) Regulations, 2017 (the Regulations) prepared by the Board of Directors of Indus Motor Company
Limited (the Company) for the year ended June 30, 2018 in accordance with the requirements of regulation 40
of the Regulations.
The responsibility for compliance with the Regulations is that of the Board of Directors of the Company.
Our responsibility is to review whether the Statement of Compliance reflects the status of the Company’s
compliance with the provisions of the Regulations and report if it does not and to highlight any non-compliance
with the requirements of the Regulations. A review is limited primarily to inquiries of the Company’s personnel
and review of various documents prepared by the Company to comply with the Regulations.
As a part of our audit of the financial statements we are required to obtain an understanding of the accounting
and internal control systems sufficient to plan the audit and develop an effective audit approach. We are not
required to consider whether the Board of Directors’ statement on internal control covers all risks and controls
or to form an opinion on the effectiveness of such internal controls, the Company’s corporate governance
procedures and risks.
The Regulations require the Company to place before the Audit Committee, and upon recommendation of the
Audit Committee, place before the Board of Directors for their review and approval, its related party transactions
and also ensure compliance with the requirements of section 208 of the Companies Act, 2017. We are only
required and have ensured compliance of this requirement to the extent of the approval of the related party
transactions by the Board of Directors upon recommendation of the Audit Committee. We have not carried
out procedures to assess and determine the Company’s process for identification of related parties and that
whether the related party transactions were undertaken at arm’s length price or not.
Based on our review, nothing has come to our attention which causes us to believe that the Statement
of Compliance does not appropriately reflect the Company’s compliance, in all material respects, with the
requirements contained in the Regulations as applicable to the Company for the year ended June 30, 2018.
Chartered Accountants
Dated: August 31, 2018
Karachi
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF INDUS
MOTOR COMPANY LIMITED
Report on the Audit of the financial statements
Opinion
We have audited the annexed financial statements of Indus Motor Company Limited (the Company), which
comprise the statement of financial position as at June 30, 2018, and the statement of profit or loss, the
statement of comprehensive income, the statement of changes in equity, the statement of cash flows for the
year then ended, and notes to the financial statements, including a summary of significant accounting policies
and other explanatory information, and we state that we have obtained all the information and explanations
which, to the best of our knowledge and belief, were necessary for the purposes of the audit.
In our opinion and to the best of our information and according to the explanations given to us, the statement
of financial position, the statement of profit or loss, the statement of comprehensive income, the statement of
changes in equity and the statement of cash flows together with the notes forming part thereof conform with
the accounting and reporting standards as applicable in Pakistan and give the information required by the
Companies Act, 2017 (XIX of 2017), in the manner so required and respectively give a true and fair view of the
state of the Company’s affairs as at June 30, 2018 and of the profit and other comprehensive loss, the changes
in equity and its cash flows for the year then ended.
Basis for Opinion
We conducted our audit in accordance with International Standards on Auditing (ISAs) as applicable in Pakistan.
Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit
of the Financial Statements section of our report. We are independent of the Company in accordance with
the International Ethics Standards Board for Accountants’ Code of Ethics for Professional Accountants as
adopted by the Institute of Chartered Accountants of Pakistan (the Code) and we have fulfilled our other ethical
responsibilities in accordance with the Code. We believe that the audit evidence we have obtained is sufficient
and appropriate to provide a basis for our opinion.
Key Audit Matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit
of the financial statements of the current year. These matters were addressed in the context of our audit of the
financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion
on these matters.
Following are the Key Audit Matters:
S. No. Key Audit Matters How the matter was addressed in our audit
(i) First time application of fourth schedule

to the Companies Act, 2017 (Refer note 2.1
to the annexed financial statements)
The fourth schedule to the Companies Act, 2017 We reviewed and understood the requirements
became applicable to the Company for the first of the fourth schedule to the Companies Act,
time for the preparation of the annexed financial 2017. Our audit procedures included the follow-
statements. ing:
The Companies Act, 2017 has introduced • Considered the management’s process to
certain changes with regard to preparation and identify the additional disclosures required
presentation of the annual financial statements in the Company’s annexed financial state-
of the Company. ments.
As part of this transition to the requirements of • Obtained relevant underlying supports for
the Companies Act, 2017, the management the additional disclosures and assessed
performed a gap analysis to identify differences their appropriateness for sufficient audit ev-
between the previous financial reporting idence.
framework and the current financial reporting
framework and as a result certain changes • Verified on test basis the supporting evi-
were made in the Company’s annexed financial dence for the additional disclosures and
statements which are included in notes 3.3, 3.5, ensured appropriateness of the disclosures
4.2, 16.1, 18.2, 22.3.1, 24.2, 25.2, 28.2, 32.2, made.
36, 37.3, 40 and 44 to the annexed financial
statements.
In view of the extensive impacts in the annexed

financial statements due to first time application
of the fourth schedule to the Companies Act,
2017, we considered it as a key audit matter.
(ii) Estimates involved in the provision for

warranty obligations (Refer note 18.3 to the
annexed financial statements)
The Company normally provides two years Our audit procedures included the following:
warranty on its locally manufactured vehicles
to customers and maintains a provision in
this respect, which amounts to Rs 1,237.520
million as at June 30, 2018. The management • We obtained an understanding of the war-
carries out a semi-annual exercise to assess ranty process, evaluated the design of, and
the reasonableness of the provision for warranty performed the related tests of controls.
S. No. Key Audit Matters How the matter was addressed in our audit
obligations retained in the financial statements. • We evaluated the appropriateness of the

The management and Board of Directors of the Company’s methodology for calculating
Company consider it as a siginificant estimate the charge of warranty provisions for
and the provisioning methodology is regularly the year and tested the basis for the
reviewed by the Board’s Audit Committee. In assumptions developed and used in the
ascertaining the adequacy of the provision, the determination of the warranty provisions.
Board takes into account the trend of regular
warranty claims and any previous incidents of • We performed a sensitivity analysis to
recall. evaluate the judgements made by the
management based on reasonably
Due to the significance of the provision balance expected movements in the assumptions
and related significant estimation involved, we used and tested the validity of the data used
considered it as a key audit matter. in the calculations.
Information Other than the Financial Statements and Auditor’s Report Thereon
Management is responsible for the other information. The other information comprises the information included
in the annual report, but does not include the financial statements and our auditor’s report thereon.
Our opinion on the financial statements does not cover the other information and we do not express any form
of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information and,
in doing so, consider whether the other information is materially inconsistent with the financial statements or
our knowledge obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other
information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of Management and Board of Directors for the Financial Statements
Management is responsible for the preparation and fair presentation of the financial statements in accordance
with the accounting and reporting standards as applicable in Pakistan and the requirements of the Companies
Act, 2017 (XIX of 2017) and for such internal control as management determines is necessary to enable the
preparation of the financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, management is responsible for assessing the Company’s ability to continue
as a going concern, disclosing, as applicable, matters related to going concern and using the going concern
basis of accounting unless management either intends to liquidate the Company or to cease operations, or has
no realistic alternative but to do so.
The Board of Directors are responsible for overseeing the Company’s financial reporting process.

Auditor’s Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free
from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our
opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted
in accordance with ISAs as applicable in Pakistan will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate,
they could reasonably be expected to influence the economic decisions of users taken on the basis of these
financial statements.
As part of an audit in accordance with ISAs as applicable in Pakistan, we exercise professional judgment and
maintain professional skepticism throughout the audit. We also:
• Identify and assess the risks of material misstatement of the financial statements, whether due to fraud
or error, design and perform audit procedures responsive to those risks, and obtain audit evidence
that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material
misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion,
forgery, intentional omissions, misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that
are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness
of the Company’s internal control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates
and related disclosures made by management.
• Conclude on the appropriateness of management’s use of the going concern basis of accounting and,
based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions
that may cast significant doubt on the Company’s ability to continue as a going concern. If we conclude
that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related
disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our
conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However,
future events or conditions may cause the Company to cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the financial statements, including the
disclosures, and whether the financial statements represent the underlying transactions and events in a
manner that achieves fair presentation.
We communicate with the Board of Directors regarding, among other matters, the planned scope and timing
of the audit and significant audit findings, including any significant deficiencies in internal control that we identify
during our audit.
We also provide the Board of Directors with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and other matters that
may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with the Board of Directors, we determine those matters that were of most
significance in the audit of the financial statements of the current period and are therefore the key audit matters.
102
We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about
the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated
in our report because the adverse consequences of doing so would reasonably be expected to outweigh the
public interest benefits of such communication.
Report on Other Legal and Regulatory Requirements
Based on our audit, we further report that in our opinion:
(a) proper books of account have been kept by the Company as required by the Companies Act, 2017
(XIX of 2017);
(b) the statement of financial position, the statement of profit or loss, the statement of comprehensive
income, the statement of changes in equity and the statement of cash flows together with the notes
thereon have been drawn up in conformity with the Companies Act, 2017 (XIX of 2017) and are in
agreement with the books of account and returns;
(c) investments made, expenditure incurred and guarantees extended during the year were for the
purpose of the Company’s business; and
(d) zakat deductible at source under the Zakat and Ushr Ordinance, 1980 (XVIII of 1980), was deducted by
the company and deposited in the Central Zakat Fund established under section 7 of that Ordinance.
The engagement partner on the audit resulting in this independent auditor’s report is Shahbaz Akbar.
Chartered Accountants
A. F. Ferguson & Co.
Dated: August 31, 2018
Karachi

Statement of Financial Position
As at June 30, 2018
Note 2018 2017

----------(Rupees in ‘000)----------
ASSETS
Non-Current Assets
Property, plant and equipment 3 7,224,839 6,257,927
Intangible assets 3 86,540 87,517
Long-term loans and advances 4 48,525 9,368
Long-term deposits 5 9,443 9,443
Deferred taxation - net 6 14,589 73,969
7,383,936 6,438,224
Current Assets
Stores and spares 7 301,254 203,829
Stock-in-trade 8 11,150,736 9,317,883
Trade debts 9 1,453,670 758,872
Loans and advances 10 3,714,654 1,652,906
Short-term prepayments 11 14,639 20,839
Accrued return 12 120,016 376,037
Other receivables 13 556,284 402,304
Short-term investments 14 55,031,103 41,487,709
Cash and bank balances 15 2,200,772 3,221,120
74,543,128 57,441,499
TOTAL ASSETS 81,927,064 63,879,723
EQUITY
Share Capital
Authorised capital
500,000,000 (2017: 500,000,000) ordinary shares of Rs 10 each 5,000,000 5,000,000
Issued, subscribed and paid-up capital 16 786,000 786,000

Reserves 17 35,958,342 30,410,962
36,744,342 31,196,962
LIABILITIES
Non-Current Liabilities
Deferred Revenue 22,711 3,933
Current Liabilities
Current portion of deferred revenue 3,933 -
Unclaimed dividend 182,437 167,301
Unpaid dividend 60,445 -
Trade payables, other payables and provisions 18 15,731,241 9,515,578
Advances from customers and dealers 19 27,491,128 22,188,881
Taxation - net 21 1,690,827 807,068
45,160,011 32,678,828
TOTAL EQUITY AND LIABILITIES 81,927,064 63,879,723
CONTINGENCIES AND COMMITMENTS 22
The annexed notes 1 to 48 form an integral part of these financial statements.
Aqeel Loon Ali Asghar Jamali Yuji Takarada

Chief Financial Officer Chief Executive Vice Chairman & Director
104
Profit and Loss Account

For the year ended June 30, 2018
Note 2018 2017

----------(Rupees in ‘000)----------
Net sales 23 140,207,524 112,271,656

Cost of sales 24 (115,830,771) (92,449,955)
Gross profit 24,376,753 19,821,701
Distribution expenses 25 (1,283,889) (1,227,647)

Administrative expenses 26 (1,523,800) (1,053,340)
Other operating expenses 28 (193,620) (176,918)
(3,001,309) (2,457,905)
21,375,444 17,363,796
Workers’ Profit Participation Fund and Workers’ Welfare Fund 29 (1,704,557) (1,418,456)
19,670,887 15,945,340
Other income 30 3,900,685 3,593,425
23,571,572 19,538,765
Finance cost 31 (572,406) (397,998)
Profit before taxation 22,999,166 19,140,767
Taxation 32 (7,227,306) (6,139,502)
Profit after taxation 15,771,860 13,001,265
--------------(Rupees )--------------
Earnings per share - basic and diluted 33 200.66 165.41


Statement of Comprehensive Income
Note 2018 2017

----------(Rupees in ‘000)----------
Other comprehensive loss
Items that will not be reclassified to profit or loss
Remeasurement loss on net defined benefit obligation 27.4 (9,127) (2,732)

Related deferred tax income thereon 2,647 820
(6,480) (1,912)
Total comprehensive income for the year 15,765,380 12,999,353

106
Cash Flow Statement

Note 2018 2017

----------(Rupees in ‘000)----------
CASH FLOWS FROM OPERATING ACTIVITIES
Cash generated from operations 34 30,392,927 20,197,225

Net increase in long-term loans and advances (39,157) (5,574)
Net decrease in long-term deposits - 505
Mark-up paid on advances received from customers (400,320) (211,894)
Increase in deferred revenue 18,778 3,933
Payment to Workers’ Profit Participation Fund (1,205,000) (1,062,000)
Payment to Workers’ Welfare Fund (356,881) (361,179)
Income tax paid (6,281,518) (5,951,842)
Net cash inflow from operating activities 22,128,829 12,609,174
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property, plant and equipment and intangible assets (2,947,269) (3,036,599)
Proceeds from disposals of property, plant and equipment 74,119 51,148
Interest received on bank deposits and Term Deposit Receipts 1,891,973 1,708,701
Interest received on Pakistan Investment Bonds 287,404 569,869
Proceeds from redemption of Pakistan Investment Bonds 5,123,453 -
Investment in listed mutual fund units (17,705,961) (14,324,950)
Proceeds from redemption of listed mutual fund units 8,941,825 14,580,868
Investment in Term Deposit Receipts - (12,000,000)
Proceeds from redemption of Term Deposit Receipts 7,000,000 9,500,000
Investment in Market Treasury Bills (5,749,468) (2,428,500)
Proceeds from redemption of Market Treasury Bills 6,540,973 5,023,450
Net cash inflow from / (outflow on) investing activities 3,457,049 (356,013)
CASH FLOWS FROM FINANCING ACTIVITY
Dividends paid (10,142,419) (9,391,010)

Net cash outflow on financing activity (10,142,419) (9,391,010)
Net increase in cash and cash equivalents during the year 15,443,459 2,862,151
Cash and cash equivalents at beginning of the year 32,599,720 29,737,569
Cash and cash equivalents at end of the year 35 48,043,179 32,599,720


Statement of Changes In Equity
Share Capital Reserves

Capital Revenue
Issued, Premium Total
subscribed on issue General Unappro- Sub-Total
and paid-up of ordinary reserve priated profit
shares
---------------------------------------- (Rupees in ‘000) ----------------------------------------
Balance at July 1, 2016 786,000 196,500 19,851,050 6,796,059 26,843,609 27,629,609
Transfer to general reserve for the year ended

June 30, 2016 appropriated subsequent to year end - - 3,600,000 (3,600,000) - -
Transactions with owners
Final dividend @ 400% for the year ended

June 30, 2016 declared subsequent to year end - - - (3,144,000) (3,144,000) (3,144,000)
1st Interim dividend for the year ended

June 30, 2017@ 250% - - - (1,965,000) (1,965,000) (1,965,000)
2nd Interim dividend for the year ended

June 30, 2017@ 250% - - - (1,965,000) (1,965,000) (1,965,000)
3rd Interim dividend for the year ended

June 30, 2017@ 300% - - - (2,358,000) (2,358,000) (2,358,000)
Total transactions with owners - - - (9,432,000) (9,432,000) (9,432,000)
Profit after taxation for the year - - - 13,001,265 13,001,265 13,001,265

Other comprehensive loss for the year - - - (1,912) (1,912) (1,912)
Total comprehensive income for the year
ended June 30, 2017 - - - 12,999,353 12,999,353 12,999,353
Balance at June 30, 2017 786,000 196,500 23,451,050 6,763,412 30,410,962 31,196,962
Transfer to general reserve for the year ended

June 30, 2017 appropriated subsequent to year end - - 4,000,000 (4,000,000) - -
Transactions with owners
Final dividend @ 350% for the year ended

June 30, 2017 declared subsequent to year end - - - (2,751,000) (2,751,000) (2,751,000)
1st Interim dividend for the year ended

June 30, 2018 @ 300% - - - (2,358,000) (2,358,000) (2,358,000)

June 30, 2018 @ 325% - - - (2,554,500) (2,554,500) (2,554,500)

June 30, 2018 @ 325% - - - (2,554,500) (2,554,500) (2,554,500)
Total transactions with owners - - - (10,218,000) (10,218,000) (10,218,000)
Profit after taxation for the year - - - 15,771,860 15,771,860 15,771,860

Other comprehensive loss for the year - - - (6,480) (6,480) (6,480)
Total comprehensive income for the year
ended June 30, 2018 - - - 15,765,380 15,765,380 15,765,380
Balance at June 30, 2018 786,000 196,500 27,451,050 8,310,792 35,958,342 36,744,342
Proposed final dividend and transfer between reserves made subsequent to the year ended June 30, 2018 are disclosed in note 45 to these financial
statements.

108
Notes to and Forming Part of the Financial Statements

1 GENERAL INFORMATION
Indus Motor Company Limited (the Company) was incorporated in Pakistan as a public limited
company in December 1989 and started commercial production in May 1993. The shares of the
Company are quoted on the Pakistan Stock Exchange.
The Company was formed in accordance with the terms of a Joint Venture agreement concluded
amongst certain House of Habib companies, Toyota Motor Corporation and Toyota Tsusho
Corporation for the purposes of assembling, progressive manufacturing and marketing of Toyota
vehicles. The Company also acts as the sole distributor of Toyota and Daihatsu vehicles in Pakistan
and has a license for assembling, progressive manufacturing and marketing of these vehicles in
Pakistan.
The registered office and factory of the Company is situated at Plot No. NWZ/1/P-1, Port Qasim
Industrial Estate, Bin Qasim, Karachi.
2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The significant accounting policies applied in the preparation of these financial statements are
set out below. These policies have been consistently applied to all the years presented, unless
otherwise stated.
2.1 Basis of preparation
2.1.1 Statement of compliance
These financial statements have been prepared in accordance with the accounting and reporting
standards as applicable in Pakistan. The accounting and reporting standards applicable in Pakistan
comprise of:
International Financial Reporting Standards (IFRS) issued by the International Accounting
-
Standards Board (IASB) as notified under the Companies Act, 2017; and
- Provisions of and directives issued under the Companies Act, 2017
Where provisions of and directives issued under the Companies Act, 2017 differ from the IFRS, the
provisions of and directives issued under the Companies Act, 2017 have been followed.
2.1.2 Initial application of standards, amendments or interpretations to existing standards
The following amendments to existing standards have been published that are applicable to the
Company’s financial statements covering annual periods, beginning on or after the following dates:
2.1.3 Standards, amendments and interpretations to approved accounting and reporting standards
that are effective in the current year
There were certain new standards, amendments and interpretations to the approved accounting
and reporting standards which became effective during the year ended June 30, 2018. However,
these are considered not to be relevant or to have any significant effect on the Company’s operations
and financial reporting and accordingly have not been disclosed in these financial statements.
The fourth schedule to the Companies Act 2017 became applicable to the Company for the first
time for the preparation of these financial statements. The Companies Act, 2017, including the
fourth schedule, forms an integral part of the statutory financial reporting framework applicable to
the Company and amongst others, prescribes the nature and content of disclosures in relation to
various elements of the financial statements.
2.1.4 Standards, amendments and interpretations to existing accounting standards that are not yet
effective and have not been early adopted by the Company

There are certain new standards, amendments and interpretations to the approved accounting
and reporting standards that will be mandatory for the Company’s annual accounting periods
beginning on or after July 1, 2018. However, these amendments will not have any significant impact
on the financial reporting of the Company and, therefore, have not been disclosed in these financial
statements. During the current year the Securities and Exchange Commission of Pakistan (the
SECP) has adopted IFRS 9 ‘Financial Instruments’, IFRS 15 ‘Revenue from Customers’ and IFRS
16 ‘Leases’ which will not have any significant impact on the financial reporting of the Company.
2.2 Basis for measurement
2.2.1 These financial statements have been prepared under the historical cost convention except that
investments classified as financial assets ‘at fair value through profit or loss’ or ‘available for sale’
and ‘derivative financial instruments’ have been marked to market and certain staff retirement
benefits are carried at present value of defined benefit obligation less fair value of plan assets.
2.2.2 Accounting estimates and judgments
The preparation of financial statements in conformity with accounting and reporting standards as
applicable in Pakistan requires management to make estimates and assumptions that affect the
reported amounts of assets and liabilities, income and expenses. It also requires management
to exercise judgment in application of the Company’s accounting policies. The estimates and
associated assumptions are based on historical experience and various other factors that are
believed to be reasonable under the circumstances. These estimates and assumptions are reviewed
on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the
estimate is revised if the revision affects only that period, or in the period of revision and future
periods if the revision affects both the current and future periods.
Significant accounting estimates and areas where judgments were exercised by management in the
application of accounting policies are disclosed in note 2.3.19 to these financial statements.
2.3 Summary of significant accounting policies
The significant accounting policies adopted in the preparation of these financial statements are
set out below. These policies have been consistently applied to all the years presented unless
otherwise stated.
2.3.1 Property, plant and equipment
2.3.1.1 Property, plant and equipment - Owned
Property, plant and equipment are stated at cost less accumulated depreciation and accumulated
impairment losses, if any, except capital work-in-progress which is stated at cost less accumulated
impairment losses, if any.
Depreciation is charged to the statement of profit or loss applying the straight line method, whereby
the depreciable amount of an asset is written off over its estimated useful life. The cost of leasehold
land is amortised equally over the lease period. Depreciation is charged on additions from the month
the asset is available for use and on disposals up to the month preceding the month of disposal. The
rates of depreciation are stated in note 3.2 to these financial statements.
The assets’ residual values, useful lives and depreciation methods are reviewed, and adjusted, if
appropriate, at each statement of financial position date.
110

Subsequent costs are included in the asset’s carrying amounts or recognised as a separate asset,
as appropriate, only when it is probable that future economic benefits associated with the item
will flow to the Company and the cost of the item can be measured reliably. Normal repairs and
maintenance are charged to the statement of profit or loss as and when incurred. All other repairs
and maintenance are charged to the statement of profit or loss during the financial period in which
they are incurred.
Gains and losses on sale or retirement of property, plant and equipment are included in the statement
of profit or loss.
Capital work-in-progress
All expenditures connected with specific assets incurred during installation and construction period
are carried under capital work-in-progress. These are transferred to specific assets as and when
assets are available for use.
2.3.1.2 Intangible assets - Computer Softwares
Computer softwares are stated at cost less accumulated amortisation. Softwares’ costs are only
capitalised when it is probable that future economic benefits attributable to the softwares will flow
to the Company and the same is amortised applying the straight line method at the rates stated in
note 3.2 to these financial statements.
2.3.1.3 Impairment of non-financial assets
The Company assesses at each statement of financial position date whether there is any indication
that property, plant and equipment and intangible assets may be impaired. If any such indication
exists, the carrying amounts of such assets are reviewed to assess whether they are recorded in
excess of their recoverable amounts and where the carrying values exceed the estimated recoverable
amount, the assets or cash-generating units are written down to their recoverable amounts and the
differences are recognised in the statement of profit or loss.
2.3.2 Stores and spares
Stores and spares, except in transit are valued at cost, determined on a moving average basis.
Provision is made for any slow moving and obsolete items. Items in transit are valued at cost
comprising invoice values plus other charges incurred thereon.
2.3.3 Stock-in-trade
Stock-in-trade, except in transit, are valued at the lower of cost and net realisable value. Stock in
transit are valued at cost as accumulated upto the statement of financial position date, comprising
invoice values plus other charges incurred thereon.
Cost of raw materials, own manufactured vehicles and trading stock is determined on a moving
average basis. Cost of work-in-process is valued at material cost.
Provision for obsolete and slow moving stock-in-trade is determined based on the management’s
assessment regarding their future usability.
Net realisable value signifies the estimated selling price in the ordinary course of business less
estimated cost of completion and the estimated costs necessarily to be incurred for its sale.

2.3.4 Financial instruments
2.3.4.1 Financial assets
2.3.4.1.1 Classification
The management determines the appropriate classification of its financial assets in accordance
with the requirements of International Accounting Standard 39 (IAS 39) “Financial Instruments:
Recognition and Measurement” at the time of purchase of financial assets and re-evaluates this
classification on a regular basis. The financial assets of the Company are categorised as follows:
a) Financial assets ‘at fair value through profit or loss’
Financial assets that are acquired principally for the purpose of generating profit from short-term
fluctuations in prices are classified as financial assets ‘at fair value through profit or loss’ category.
b) Loans and receivables
These are non-derivative financial assets with fixed or determinable payments that are not quoted
in an active market. The Company’s loans and receivables comprise of trade debts, loans and
advances, deposits, cash and bank balances and other receivables in the statement of financial
position.
c) Held to maturity
Financial assets with fixed or determinable payments and fixed maturity and where management
has the intention and ability to hold till maturity are classified as held to maturity. These are stated
at amortised cost.
d) Available for sale financial assets
Financial assets intended to be held for an indefinite period of time, which may be sold in response
to needs for liquidity or changes in equity prices, are classified as ‘available for sale’. Available for
sale financial instruments are those non-derivative financial assets that are designated as available
for sale or are not classified as (a) loans and receivables, (b) held to maturity and (c) financial assets
‘at fair value through profit or loss’.
2.3.4.1.2 Initial recognition and measurement
All financial assets are recognised at the time the Company becomes a party to the contractual
provisions of the instrument. Regular purchases and sales of financial assets are recognised on
the trade date - the date on which the Company commits to purchase or sell the assets. Financial
assets are initially recognised at fair value plus transaction costs except for financial assets carried at
fair value through profit or loss. Financial assets carried at fair value through profit or loss are initially
recognised at fair value while the transaction costs associated with these financial assets are taken
directly to the statement of profit or loss.
2.3.4.1.3 Subsequent measurement
Subsequent to initial recognition, financial assets are valued as follows:
a) Financial asset ‘at fair value through profit or loss’ and ‘available for sale’
Financial assets ‘at fair value through profit or loss’ are marked to market using the closing market
rates and are carried on the statement of financial position at fair value. Net gains and losses arising
on changes in fair values of these financial assets are taken to the statement of profit or loss in the
period in which these arise.
112

‘Available for sale’ financial assets are marked to market using the closing market rates and are
carried on the statement of financial position at fair value. Net gains and losses arising on changes
in fair values of these financial assets are recognised in other comprehensive income.
b) Financial assets classified as ‘loans and receivables’ and ‘held to maturity’
Loans and receivables and held to maturity financial assets are carried at amortised cost.
2.3.4.1.4 Impairment
The Company assesses at each statement of financial position date whether there is objective
evidence that a financial asset is impaired.
a) Assets carried at amortised cost
A financial asset or a group of financial assets is impaired and impairment losses are incurred only
if there is objective evidence of impairment as a result of one or more events that occurred after the
initial recognition of the asset (a ‘loss event’) and that loss event (or events) has an impact on the
estimated future cash flows of the financial asset or group of financial assets that can be reliably
estimated.
Evidence of impairment may include indications that the debtors or a group of debtors is experiencing
significant financial difficulty or default in payments, the probability that they will enter bankruptcy,
and where observable data indicate that there is a measurable decrease in the estimated future
cash flows, such as changes in arrears or economic conditions that correlate with defaults.
For loans and receivables category, the amount of the loss is measured as the difference between
the asset’s carrying amount and the present value of estimated future cash flows (excluding future
credit losses that have not been incurred) discounted at the financial asset’s original effective interest
rate. The carrying amount of the asset is reduced and the amount of the loss is recognised in the
statement of profit or loss. If a loan or held-to-maturity investment has a variable interest rate, the
discount rate for measuring any impairment loss is the current effective interest rate determined
under the contract. As a practical expedient, the Company also evaluates impairment on the basis
of an instrument’s fair value using an observable market price.
If, in a subsequent period, the amount of the impairment loss decreases and the decrease can
be related objectively to an event occurring after the impairment was recognised (such as an
improvement in the debtor’s credit rating), the reversal of the previously recognised impairment loss
is recognised in the statement of profit or loss.
b) Assets classified as ‘available for sale’
In the case of equity investments classified as available for sale, a significant or prolonged decline in
the fair value of the security below its cost is also evidence that the assets are impaired.
If any evidence for impairment exists, the cumulative loss is removed from equity and recognised
in the statement of profit or loss. For investments, other than equity instruments, the increase in
fair value in a subsequent period thereby resulting in reversal of impairment is reversed through the
statement of profit or loss.
2.3.4.1.5 Offsetting of financial assets and financial liabilities
A financial asset and a financial liability is offset and the net amount is reported in the financial
statements if the Company has a legally enforceable right to set-off the transaction and also intends
either to settle on a net basis or to realise the asset and settle the liability simultaneously.

2.3.4.2 Financial liabilities
All financial liabilities are recognised at the time when the Company becomes a party to the
contractual provisions of the instrument.
2.3.4.3 Derecognition
Financial assets are derecognised at the time when the Company loses control of the contractual
rights that comprise the financial assets. Financial liabilities are derecognised at the time when
they are extinguished i.e. when the obligation specified in the contract is discharged, cancelled, or
expires. Any gain or loss on derecognition of financial assets and financial liabilities is taken to the
statement of profit or loss.
2.3.5 Loans, advances and deposits
These are stated at cost less estimates made for any doubtful receivables based on a review of all
outstanding amounts at the statement of financial position date. Balances considered doubtful and
irrecoverable are written off when identified.
Long term loans are initially carried at cost as the effect of carrying these balances at amortised cost
would not be material in the overall context of these financial statements.
2.3.6 Trade debts and other receivables
Trade debts and other receivables are recognised and carried at original invoice amount less an
allowance for any uncollectible amounts. Other receivables are carried at cost less estimates made
for doubtful receivables, if any.
An estimate for doubtful trade debts and other receivables is made when collection of the full
amount is no longer probable. Bad debts are written off when identified.
2.3.7 Derivative financial instruments and hedge accounting
The Company designates derivative financial instruments as either fair value hedge or cash flow
hedge.
Fair value hedge
Fair value hedge represents hedges of the fair value of recognised assets or liabilities or a firm
commitment. Changes in the fair value of derivatives that are designated and qualify as fair value
hedges are recorded in the statement of profit or loss, together with any changes in the fair value of
the hedged asset or liability that are attributable to the hedged risk. The carrying value of the hedged
item is adjusted accordingly.
Cash flow hedge
Changes in fair value of derivative hedging instruments designated as a cash flow hedge are
recognised in the statement of comprehensive income to the extent that the hedge is effective. To
the extent the hedge is ineffective, changes in fair value are recognised in the statement of profit or
loss.
Amounts accumulated in equity are reclassified to the statement of profit or loss in the periods in
which the hedged item will affect the statement of profit or loss.
2.3.8 Taxation
Current
Provision for current taxation is based on taxable income at the current rates of taxation, after
considering rebates and tax credits available, if any, and taxes paid under the Final Tax Regime. The
charge for current tax also includes adjustments where necessary, relating to prior years which arise
from assessments framed / finalised during the year.
114

Deferred
Deferred tax is recognised using the statement of financial position liability method, on major
temporary differences at the statement of financial position date between the tax bases of assets
and liabilities and their carrying amounts for financial reporting purposes. Deferred tax assets are
recognised for all deductible temporary differences to the extent that the temporary differences will
reverse in the future and taxable income will be available against which the deductible temporary
differences can be utilised.
The carrying amount of deferred tax assets is reviewed at each statement of financial position date
and reduced to the extent that it is no longer probable that sufficient taxable profit will be available
to allow all or part for the deferred tax asset to be utilised.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the
period when the asset is realised or the liability is settled, based on tax rates (and tax laws) that have
been enacted or substantively enacted at the statement of financial position date.
2.3.9 Cash and cash equivalents
For the purpose of the cash flow statement, cash and cash equivalents comprise of cash in
hand, bank balances, bank deposits net of running finances and short term investments having a
contractual maturity of three months or less. The cash and cash equivalents are readily convertible
to known amounts of cash and are therefore subject to insignificant risk of changes in value.
2.3.10 Trade and other payables
Liabilities for trade and other amounts payable are carried at cost, which is the fair value of the
consideration to be paid in the future for goods and services, whether or not billed to the Company.
2.3.11 Provisions
Provisions are recognised when the Company has a present legal or constructive obligation as a
result of past events, it is probable that an outflow of resources embodying economic benefits will
be required to settle the obligation and a reliable estimate of the amount can be made. Provisions
are reviewed at each statement of financial position date and adjusted to reflect the current best
estimate.
2.3.12 Warranty obligations
The Company recognises the estimated liability, on an accrual basis, to repair or replace products
under warranty at the statement of financial position date, and recognises the estimated product
warranty costs in the statement of profit or loss when the sale is recognised.
2.3.13 Staff retirement benefits
Defined contribution plan - Provident Fund
The Company operates a recognised provident fund for its permanent employees. Equal monthly
contributions are made to the Fund by the Company and the employees in accordance with the
rules of the Fund. The Company has no further payment obligation once the contributions have been
paid. The contributions made by the Company are recognised as an employee benefit expense
when they are due.
Defined benefit / contribution plan - Pension Fund
The Company also operates an approved funded pension scheme for its permanent employees.

The employee pension is governed by two sets of Rules, ‘New Rules’ - Defined contribution plan
and ‘Old Rules’ - Defined benefit plan. The New Rules are applicable to all members of the Fund
with effect from July 1, 2008. However, the Old Rules continue to apply to all persons whose
employment with the Company ceased before July 1, 2008 and who are entitled to pension from
the Fund. In addition, the Old Rules also apply to existing employees who have not opted to be
governed by the New Rules.
In accordance with the New Rules an actuarial balance was determined by the actuary as at June
30, 2008 in respect of all members of the Fund who were in the service of the Company as of that
date and opted to be governed by the New Rules which was credited to the members’ individual
accounts. With effect from July 2008 the Company is required to make a fixed monthly contribution
to the Fund based on the basic salary of the employees which is credited into the individual account
of each member. The Company has no further payment obligation once these monthly contributions
have been paid to the Fund. Profit earned on the investments maintained by the Fund is also
allocated into the individual account of each member.
The pension liability recognised in the statement of financial position in respect of members governed
by the Old Rules is the present value of the defined benefit obligation at the statement of financial
position date less the fair value of plan assets attributed to these members. Contributions are made
to cover the pension obligations in respect of the members governed by the Old Rules on the basis
of actuarial recommendations.
The amount arising as a result of remeasurement is recognised in the statement of financial position
immediately, with a charge or credit to other comprehensive income in the period in which they
occur.
The Projected Unit Credit Method is used for the valuation of pension liability in respect of members
governed by the Old Rules as at June 30, 2018, using significant assumptions as stated in note 27
to these financial statements.
2.3.14 Employees’ compensated absences
The Company accounts for compensated absences on the basis of unavailed earned leave balance
of each employee at the end of the year.
2.3.15 Dividend distribution and transfer between reserves
Dividend declared and appropriations to reserves made subsequent to the statement of financial
position date are considered non-adjusting events and are recognised in the financial statements in
the year in which they are approved.
2.3.16 Revenue recognition
Sales are recognised as revenue when goods are dispatched and invoiced.
Return on bank deposits, term deposit receipts and mark-up on advances to suppliers and
contractors are accounted for on an accrual basis.
Agency commission is recognised when shipments are made by the principal.
Unrealised gains / losses arising on re-measurement of investments classified as ‘financial assets at

fair value through profit or loss’ are included in the statement of profit or loss in the period in which
these arise.
Dividend income is recognised when the right to receive dividend is established.
Income on Market Treasury Bills and Pakistan Investment Bonds (PIBs) is accrued using the effective
interest rate method.
116

2.3.17 Foreign currency transactions and translation
Foreign currency transactions are recognised or accounted for in Pakistani Rupees using the
exchange rate prevailing on the date of the transaction. Monetary assets and liabilities in foreign
currencies are translated into Pakistani Rupees at the rates of exchange prevailing on the statement
of financial position date. Exchange gain / loss on foreign currency translations are included in
income / equity along with any related hedge effects.
2.3.18 Functional and presentation currency
Items included in the financial statements are measured using the currency of the primary economic
environment in which the Company operates. The financial statements are presented in Pakistani
Rupees, which is the Company’s functional and presentation currency.
2.3.19 Accounting estimates and judgments
The preparation of financial statements in conformity with accounting and reporting standards
as applicable in Pakistan requires the use of certain critical accounting estimates. It also requires
management to exercise its judgment in the process of applying the Company’s accounting policies.
Estimates and judgments are continually evaluated and are based on historical experience, including
expectation of future events that are believed to be reasonable under the circumstances. The areas
where various assumptions and estimates are significant to the Company’s financial statements or
where judgment was exercised in application of accounting policies are as follows:
i) Useful lives of property, plant and equipment (notes 2.3.1 and 3.2)
The Company reviews the useful lives of fixed assets on a regular basis. Any change in estimates in
future years might affect the carrying amounts of respective items of operating fixed assets with a
corresponding effect on the depreciation charge and impairment.
ii) Provision for slow moving stores and spares (notes 2.3.2 and 7)
The Company exercises judgment and makes provision for slow moving stores and spares based
on their future usability.
iii) Provision for slow moving stock-in-trade (notes 2.3.3 and 8)
The Company exercises judgment and makes provision for slow moving stock-in-trade based on
their future usability and recoverable value.
iv) Provision for doubtful debts (notes 2.3.6 and 9)
The Company makes provision for doubtful debts when the collection of full amount is no longer
probable.
v) Classification and valuation of investments (notes 2.3.4 and 14)
The Company takes into account its intention for classification of investments as mentioned in
note 2.3.4.1.1 at the time of purchase. The valuation of investments is done based on the criteria
mentioned in notes 2.3.4.1.2, 2.3.4.1.3 and 2.3.4.1.4.
vi) Income taxes (notes 2.3.8 and 32)
The Company takes into account the current income tax law and the decisions taken by the appellate
authorities. Instances where the Company’s view differs from the view taken by the Income Tax
Department at the assessment stage and where the Company considers that its views on the items
of material nature is in accordance with the law, the amounts are shown as contingent liabilities.
Deferred tax asset is recognised only to the extent that it is probable that future taxable profits will
be available against which the asset may be utilised.

vii) Warranty obligations (notes 2.3.12 and 18.3)
The Company exercises professional judgment, based on the history of warranty claims entertained,
number of cars eligible for warranty and its internal risk assessment while making assessment in
respect of the warranty obligations.
viii) Staff retirement benefits (notes 2.3.13 and 27)
The Company has post retirement benefit obligations, which are determined through actuarial
valuations as carried out by an independent actuary using various assumptions as disclosed in note
27 to these financial statements.
ix) Contingencies and commitments (note 22)
The Company uses assumptions and estimates in disclosure and assessment of provision for
contingencies as disclosed in note 22.
2.3.20 Segment reporting
The Company uses ‘management approach’ for segment reporting, under which segment
information is required to be presented on the same basis as that used for internal reporting
purposes. Operating segments have been determined and presented in a manner consistent with
the internal reporting provided to the chief operating decision-maker. The Company has determined
operating segments on the basis of business activities i.e. manufacturing and trading activities.
Segment assets have not been disclosed in these financial statements as these are not reported to
the chief operating decision-maker on a regular basis.
2.3.21 Deferred revenue
Amount received on account of sale of extended warranty services against vehicles is recognised
initially as deferred revenue and credited to the statement of profit or loss in the relevant period
covered by the warranty.
Note 2018 2017

-----(Rupees in ‘000)-----
3 PROPERTY, PLANT AND EQUIPMENT & INTANGIBLE ASSETS
Property, plant and equipment 3.1 7,224,839 6,257,927

Intangible assets 3.2 86,540 87,517
7,311,379 6,345,444
3.1 Property, plant and equipment
Tangible operating assets 3.2 6,933,371 5,190,839

Capital work-in-progress 3.6 291,468 1,067,088
7,224,839 6,257,927
118
3.2 The following is a statement of tangible operating assets and intangible assets:
------------------------------------------------------------------------------------- 2018 -------------------------------------------------------------------------------------

Intangible
Tangible assets
assets
Total
Factory Other Jigs,
Computer tangible
building on building on Plant and Motor Furniture Office Tools and moulds Computer
Leasehold land and related assets
leasehold leasehold machinery vehicles and fixtures equipment equipment and related software
accessories
land land equipments
------------------------------------------------------------------------------ (Rupees in ‘000) ------------------------------------------------------------------------------
At July 1, 2017
Cost 108,662 1,299,785 459,459 9,777,677 415,871 227,342 161,177 249,445 831,157 4,062,228 17,592,803 148,601
Accumulated depreciation /
amortisation (26,242) (926,539) (191,804) (7,310,424) (185,034) (201,341) (102,578) (184,821) (678,719) (2,594,462) (12,401,964) (61,084)
Net book value 82,420 373,246 267,655 2,467,253 230,837 26,001 58,599 64,624 152,438 1,467,766 5,190,839 87,517
Year ended June 30, 2018

Opening net book value 82,420 373,246 267,655 2,467,253 230,837 26,001 58,599 64,624 152,438 1,467,766 5,190,839 87,517
Additions
- Direct - 1,011 400 122,000 191,821 1,870 8,314 25,440 23,734 2,653 377,243 26,481
- Transfers from CWIP - 850,436 33,074 2,314,483 - 6,155 10,774 35,143 61,054 3,648 3,314,767 4,398
Disposals / write offs

- Cost - - - (35,208) (141,357) - (515) (5,807) (4,607) - (187,494) -
- Accumulated depreciation - - - 35,208 85,608 - 502 5,696 2,880 - 129,894 -
- - - - (55,749) - (13) (111) (1,727) - (57,600) -
Depreciation / amortisation
charge for the year (3,610) (95,129) (36,512) (1,003,087) (76,461) (10,471) (20,304) (35,951) (56,882) (553,471) (1,891,878) (31,856)
Closing net book value 78,810 1,129,564 264,617 3,900,649 290,448 23,555 57,370 89,145 178,617 920,596 6,933,371 86,540
At June 30, 2018

Cost 108,662 2,151,232 492,933 12,178,952 466,335 235,367 179,750 304,221 911,338 4,068,529 21,097,319 179,480
amortisation (29,852) (1,021,668) (228,316) (8,278,303) (175,887) (211,812) (122,380) (215,076) (732,721) (3,147,933) (14,163,948) (92,940)
Net book value 78,810 1,129,564 264,617 3,900,649 290,448 23,555 57,370 89,145 178,617 920,596 6,933,371 86,540
rate % per annum 2.38%-3.85% 10% 5% 10%-20% 20% 20% 20% 33.33% 20% 20%-25% 33.33%
Annual Report 2018

119
----------------------------------------------------------------------------------------- 2017 -----------------------------------------------------------------------------------------
120
Intangible
Tangible assets
assets
Total
Factory Other Jigs, tangible
Computer
building on building on Plant and Motor Furniture Office Tools and moulds assets Computer
Leasehold land and related
leasehold leasehold machinery vehicles and fixtures equipment equipment and related software
accessories
land land equipments
--------------------------------------------------------------------------------- (Rupees in ‘000) ---------------------------------------------------------------------------------
At July 1, 2016
Cost 108,662 1,290,878 326,221 9,202,056 332,015 215,494 143,595 200,700 773,036 3,301,785 15,894,442 65,417
amortisation (22,632) (900,936) (99,599) (6,677,096) (178,188) (194,796) (87,758) (159,622) (637,160) (2,225,869) (11,183,656) (46,126)
Net book value 86,030 389,942 226,622 2,524,960 153,827 20,698 55,837 41,078 135,876 1,075,916 4,710,786 19,291
Year ended June 30, 2017

Opening net book value 86,030 389,942 226,622 2,524,960 153,827 20,698 55,837 41,078 135,876 1,075,916 4,710,786 19,291
Additions
- Direct - 2,145 3,423 159,055 159,961 97 10,063 31,192 7,886 3,425 377,247 -
- Transfers from CWIP - 72,721 63,856 588,633 - 13,769 10,221 5,921 55,698 891,387 1,702,206 98,258
Disposals / write offs

- Cost - - - (178,071) (70,101) (2,018) (2,702) (3,442) (5,463) (134,369) (396,166) -
- Accumulated depreciation - - - 174,449 47,453 2,018 2,702 3,221 5,463 134,369 369,675 -
- - - (3,622) (22,648) - - (221) - - (26,491) -
Depreciation / amortisation (3,610) (84,522) (33,286) (801,980) (60,096) (8,563) (17,522) (20,939) (47,022) (502,962) (1,580,502) (22,439)
charge for the year
Transfers
Cost - (65,959) 65,959 6,004 (6,004) - - 15,074 - - 15,074 (15,074)
Accumulated depreciation - 58,919 (58,919) (5,797) 5,797 - - (7,481) - - (7,481) 7,481
(7,040) 7,040 207 (207) - - (7,593) - - 7,593 (7,593)
Closing net book value 82,420 373,246 267,655 2,467,253 230,837 26,001 58,599 64,624 152,438 1,467,766 5,190,839 87,517
At June 30, 2017

Cost 108,662 1,299,785 459,459 9,777,677 415,871 227,342 161,177 249,445 831,157 4,062,228 17,592,803 148,601
amortisation (26,242) (926,539) (191,804) (7,310,424) (185,034) (201,341) (102,578) (184,821) (678,719) (2,594,462) (12,401,964) (61,084)
Net book value 82,420 373,246 267,655 2,467,253 230,837 26,001 58,599 64,624 152,438 1,467,766 5,190,839 87,517
rate % per annum 2.38%-3.85% 10% 5% 10%-20% 20% 20% 20% 33.33% 20% 20%-25% 33.33%

3.3 Leasehold land, on which the factory building, plant and warehouse are situated, is spread across
an area of 107.5 acres. It is located at Plot No. NWZ/1/P-1 & W2/1/1-3, Port Qasim Industrial
Estate, Bin Qasim, Karachi.
3.4 The depreciation charge for the year has been allocated as follows:
Note 2018 2017

-----(Rupees in ‘000)-----
Cost of sales - own manufactured 24 1,800,608 1,509,613

Distribution expenses 25 37,727 36,915
Administrative expenses 26 53,543 33,974
1,891,878 1,580,502
3.5 Particulars of tangible operating assets having a net book value exceeding Rs 500,000 disposed of
during the year are as follows:
Sale proceeds /
Accumulated Net book receivable
Particulars Cost Gain / (loss) Mode of disposal Particulars of buyer
depreciation value from insurance
company
---------------------------(Rupees in ‘000)---------------------------
-
Motor vehicles
1,969 (755) 1,214 1,969 755 Insurance Claim M/s Habib Insurance Company Limited - a related party
2,174 (1,667) 507 1,617 1,110 Bidding Process M/s Toyota Central Motors
1,749 (1,049) 700 1,551 851 --do-- M/s Toyota Highway Motors
1,949 (942) 1,007 1,706 699 --do-- M/s Toyota Southern Motors
2,919 (876) 2,043 2,556 513 --do-- M/s Toyota Highway Motors
3,441 (2,122) 1,319 1,450 131 --do-- Mr Muhammad Ahmer
1,749 (1,195) 554 1,501 947 --do-- M/s Toyota Highway Motors
3,264 (1,741) 1,523 2,206 683 --do-- M/s Toyota Highway Motors
5,772 (3,078) 2,694 4,006 1,312 --do-- M/s Toyota Highway Motors
9,358 (4,679) 4,679 4,506 (173) --do-- M/s Toyota Highway Motors
3,105 (2,329) 776 1,840 1,064 --do-- Mr Shahryar Khan
3,769 (1,445) 2,324 3,716 1,392 --do-- Mr Asif Nazeef
1,749 (1,020) 729 1,108 379 Employee Scheme Mr Faizan Mustafa (Key management personnel)
1,859 (248) 1,611 1,611 - --do-- Mr Ahmed Nadeem (Ex-Executive)
1,749 (1,166) 583 1,208 625 --do-- Mr Jamshed Khan (Executive)
1,749 (991) 758 1,289 531 --do-- Mr Umer Farooq (Executive)
1,859 (496) 1,363 1,611 248 --do-- Mr Rizwan Pirzada (Executive)
1,894 (284) 1,610 1,777 167 --do-- Mr Waqas Baig (Executive)
1,894 (284) 1,610 1,777 167 --do-- Mr Ismail Hanif (Executive)
1,894 (284) 1,610 1,777 167 --do-- Mr Taimoor Ahmed (Executive)
1,749 (1,166) 583 1,208 625 --do-- Mr Asif Ahmed (Executive)
2,299 (1,341) 958 1,672 714 --do-- Mr Raheel Asghar (Key management personnel)
1,749 (991) 758 1,289 531 --do-- Mr Ibrar Khan (Executive)
1,839 (858) 981 1,410 429 --do-- Mr Arif Anzer (Executive)
1,784 (654) 1,130 1,484 354 --do-- Ms Rizwana Khatoon (Executive)
1,789 (477) 1,312 1,567 255 --do-- Mr Wajid Bux (Executive)
1,969 (295) 1,674 1,838 164 --do-- Mr Faizan Mustafa (Key management personnel)
1,894 (189) 1,705 1,821 116 --do-- Mr Sheikh Salman (Executive)
2,299 (1,609) 690 1,547 857 --do-- Mr Tariq Ahmed Khan (Key management personnel)
1,749 (1,195) 554 1,194 640 --do-- Mr Shuja Ahmed (Executive)
1,864 (466) 1,398 1,631 233 --do-- Mr Muhammad Sajid (Executive)
1,954 (163) 1,791 1,893 102 --do-- Mr Kashif Rahim (Executive)
1,894 (253) 1,641 1,791 150 --do-- Mr Malik Adnan (Executive)
1,824 (1,307) 517 1,186 669 --do-- Mr Islamuddin Zafar (Key management personnel)
2,299 (1,226) 1,073 1,726 653 --do-- Mr Mohammad Ibadullah (Key management personnel)
1,809 (392) 1,417 1,626 209 --do-- Mr Shahid Shah (Executive)
1,974 (164) 1,810 1,912 102 --do-- Mr Babar Salim (Executive)
Others
Items having net
book value of less
than Rs 500,000
each 93,134 (87,993) 5,141 28,639 23,498 Various Various
2018 187,494 (129,894) 57,600 101,243 43,643

2017 396,166 (369,675) 26,491 49,434 22,943

Note 2018 2017

-------(Rupees in ‘000)-------
3.6 Capital work-in-progress
Civil works 27,703 204,931

Plant, machinery, tools and equipment 256,748 826,776
Computer and related accessories 7,017 35,381
291,468 1,067,088
3.7 Movement in capital work-in-progress
Opening balance 1,067,088 208,200

Additions during the year 2,543,545 2,659,352
Transferred to operating fixed assets (3,319,165) (1,800,464)
Closing balance 291,468 1,067,088
4 LONG-TERM LOANS AND ADVANCES
Considered good
Loans to employees - secured
Executives 4.2 37,101 23,121
Others 9,336 6,509
4.1 46,437 29,630
Advances to suppliers - unsecured 30,000 2,500
76,437 32,130
Less: Recoverable within one year; shown under current assets
Loans due from - secured
Executives 10 19,673 15,848
Employees 10 8,239 5,872
Advances to suppliers - unsecured 10 - 1,042
27,912 22,762
48,525 9,368
4.1 These represent house building and personal loans granted to executives and other employees.
These are granted in accordance with the terms of their employment and are secured against their
balances with the Provident Fund. The loans are repayable over a period of 12 to 24 months. House
building and personal loans to management employees carry interest at the rate of 3.00% to 3.50%
(2017: 3.00% to 3.50%) per annum. Non-management employees are entitled to personal loans
which carry no interest as per the approved loan policy.
4.2 These include loans to the following key management personnel: Tariq Ahmed Khan, Raheel
Asghar, Islamuddin Zafar, Mohammad Ibadullah and Ali Asghar Damani. The maximum aggregate
amount of such loans outstanding at the end of any month during the year was Rs 23.223 million
(2017: Rs 15.372 million).
2018 2017
5 LONG-TERM DEPOSITS -------(Rupees in ‘000)-------
Deposits
- Utilities 7,450 7,450
- Others 1,993 1,993
9,443 9,443
122

2018 2017
-------(Rupees in ‘000)-------
6 DEFERRED TAXATION - net
Deferred tax liability arising on taxable temporary differences:

In respect of revaluation of derivatives and unrealised gain on mutual funds (51,362) (5,171)
Deferred tax asset arising on deductible temporary differences:

Due to accelerated tax depreciation 4,266 25,097
In respect of certain provisions 61,685 54,043
Deferred tax asset - net 14,589 73,969
7 STORES AND SPARES
Stores 226,332 180,089

Spares 345,776 272,991
572,108 453,080
Less: Provision for slow moving stores and spares 270,854 249,251
301,254 203,829
8 STOCK-IN-TRADE Note 2018 2017

-------(Rupees in ‘000)-------
In hand
Manufacturing stock
Raw material and components 3,429,736 4,272,482
Less: Provision for slow moving stock-in-trade 60,166 55,200
8.1 3,369,570 4,217,282
Work-in-process 518,329 516,783
Finished goods (vehicles – own manufactured) 8.2 201,619 420,480

Less: Provision for slow moving stock-in-trade 258 1,925
4,089,260 5,152,620
Trading stock
Vehicles 8.2 1,364,969 465,278
1,361,966 463,545
Spare parts 8.3 448,828 359,275

Special service tools and publications 6,289 5,439
368,712 289,489
In transit
Raw material - manufacturing stock 5,086,106 3,227,738
Trading stock 244,692 184,491
11,150,736 9,317,883
8.1 This represents the net amount of raw material and components after recording write offs amounting
to Rs 65.360 million (2017: Rs 8.912 million).
8.2 These include vehicles amounting to Rs 918.208 million (2017: Rs 352.251 million) held with the
Company’s authorised dealers.
8.3 This includes an amount of Rs 16.909 million (2017: Rs 26.859 million) representing stock-in-trade
of motor oil.

2018 2017
-------(Rupees in ‘000)-------
9 TRADE DEBTS - UNSECURED
Considered good
Government organisations 825,580 202,166
Others 628,090 556,706
1,453,670 758,872
9.1 As at June 30, 2018, Rs 112.755 million (2017: Rs 43.679 million) are overdue but not impaired
in respect of trade debts. These balances relate to various customers, including government
organisations, for whom there is no recent history of default. The ageing analysis of these trade
debts is as follows:
Note 2018 2017

-------(Rupees in ‘000)-------
1 to 6 months 18,340 36,165

More than 6 months 94,415 7,514
112,755 43,679
10 LOANS AND ADVANCES
Current portion of long-term loans and advances - considered good

Loans due from - secured
Executives 4 19,673 15,848
Employees 4 8,239 5,872
27,912 21,720
Advances to suppliers - unsecured 4 - 1,042
27,912 22,762
Advances – considered good
Suppliers and contractors - unsecured 52,359 30,159
Employees - unsecured 13,717 36,302
Collector of Customs - secured 10.1 2,196,088 551,001
Margins held with banks against imports - secured 10.2 1,424,578 1,012,682
3,686,742 1,630,144
3,714,654 1,652,906
10.1 This represents advance amount paid to the Collector of Customs in respect of the imports of
stock-in-trade. An amount of Rs 2,159.455 million (2017: Rs 512.300 million) was subsequently
adjusted in respect of imported goods received.
10.2 This represents cash held with various banks as a regulatory requirement against letters of credit for
imports of items of stock-in-trade. An amount of Rs 1,331.806 million (2017: Rs 1,012.682 million)
was subsequently settled on receipt of invoices and documents relating to the imported items. This
includes an amount of Rs 448.051 million (Rs 728.616 million) held with Habib Metropolitan Bank
Limited - a related party.
Note 2018 2017

11 SHORT-TERM PREPAYMENTS -------(Rupees in ‘000)-------
Rent 2,300 762

Insurance 9,026 10,797
Others 3,313 9,280
11.1 14,639 20,839
11.1 This includes an amount of Rs 1.788 million (2017: Rs 5.909 million) paid to Habib Insurance
Company Limited - a related party.
124

Note 2018 2017

12 ACCRUED RETURN -------(Rupees in ‘000)-------
Pakistan Investment Bonds (PIBs) - 261,190

Term Deposit Receipts (TDRs) and bank deposits 120,016 114,847
12.1 120,016 376,037
12.1 This includes an amount of Rs 42.923 million (2017: Rs 52.739 million) receivable from Habib
Metropolitan Bank Limited - a related party.
Note 2018 2017
13 OTHER RECEIVABLES -------(Rupees in ‘000)-------
Considered good
Warranty claims and other receivables due from related
parties - Toyota Tsusho Corporation and its affiliates 13.1 21,003 35,349
Agency commission - receivable from a related party - Toyota
Tsusho Asia Pacific PTE. Limited 13.2 380,083 196,567
Warranty claims due from local vendors 4,352 5,925
Earnest money 61,802 37,961
Insurance claims - receivable from a related party - Habib
Insurance Company Limited 13.3 28,274 48,326
Workers’ Profit Participation Fund 13.4 7,079 37,265
Receivable against sale of operating fixed assets 29,131 2,007
Net unrealised gain on revaluation of foreign exchange
contracts - fair value hedge 14,013 17,238
Others 10,547 21,666
556,284 402,304
13.1 The maximum aggregate amount due at the end of any month during the year was Rs 62.063
million (2017: Rs 35.349 million).
Note 2018 2017

-------(Rupees in ‘000)-------
13.4 Workers’ Profit Participation Fund
Opening balance 37,265 3,226

Allocation for the year 29 (1,235,186) (1,027,961)
(1,197,921) (1,024,735)
Amount paid during the year 1,205,000 1,062,000
Closing balance 7,079 37,265
14 SHORT-TERM INVESTMENTS
Held to maturity
Government securities - Market Treasury Bills 14.1 10,959,172 5,224,678
Term Deposit Receipts (TDRs) 14.2 35,000,000 31,200,000
Government securities - Pakistan Investment Bonds (PIBs) - 5,063,031
45,959,172 41,487,709
At fair value through profit or loss
Listed mutual fund units 14.3 9,071,931 -
55,031,103 41,487,709

14.1 These securities have varying maturities ranging from July 5, 2018 to September 13, 2018. The yield
on these securities is 6.17% to 6.76% per annum (2017: 5.99% per annum).
14.2 As at June 30, 2018, the Company holds term deposit receipts carrying profit rates ranging between
6.55% to 7.15% per annum (2017: 5.55% to 6.75% per annum). The term deposit receipts are due
to mature maximum by August 28, 2018. Balances in term deposit receipts include an amount of
Rs 10,000 million (2017: Rs 10,000 million), held with Habib Metropolitan Bank Limited - a related
party.
14.3 These units are held with the following mutual funds:
2018
Name of Fund (Rupees in ‘000)
ABL Cash Fund 1,529,310

Alfalah GHP Money Market Fund 406,873
ABL Government Securities Fund 252,434
HBL Cash Fund 1,017,354
HBL Money Market Fund 509,386
UBL Liquidity Plus Fund 1,278,603
NAFA Money Market Fund 1,789,637
NAFA Government Securities Liquid Fund 503,734
MCB Cash Management Optimizer 1,532,655
First Habib Cash Fund 251,945
9,071,931
Note 2018 2017

15 CASH AND BANK BALANCES -------(Rupees in ‘000)-------
Cash in hand 2,872 2,899
Balances held with banks in:

current accounts 323,505 29,118
deposit accounts 15.1 1,874,395 3,189,103
2,197,900 3,218,221
2,200,772 3,221,120
15.1 These include an amount of Rs 1,426.653 million (2017: Rs 1,858.031 million), held with Habib
Metropolitan Bank Limited - a related party.
126

16 ISSUED, SUBSCRIBED AND PAID-UP CAPITAL
2018 2017 2018 2017

(Number of shares) -------(Rupees in ‘000)-------
78,600,000 78,600,000 Ordinary shares of Rs 10 each fully paid in cash 786,000 786,000
16.1 Ordinary shares of the Company held by related parties as at the year end are as follows:
Note 2018 2017

(Number of shares)
Toyota Motor Corporation
Percentage of holding 25.00% (2017: 25.00%) 16.1.1 19,650,000 19,650,000
Toyota Tsusho Corporation
Percentage of holding 12.50% (2017: 12.50%) 16.1.2 9,825,000 9,825,000
Habib Insurance Company Limited
Percentage of holding 0.05% (2017: 0.06%) 43,015 43,810
Thal Limited
Percentage of holding 6.22% (2017: 6.22%) 4,890,000 4,890,000
Mohamedali Habib Welfare Trust
Percentage of holding 0.01% (2017: 0.01%) 5,000 5,000
16.1.1 Toyota Motor Corporation (TMC) is incorporated in Japan. The registered address of TMC is 1 Toyota-
Cho, Toyota City, Aichi Prefecture 471-8571, Japan. TMC is primarily engaged in the production
and sale of automobiles. The President of TMC is Mr Akio Toyoda. The latest available audited
consolidated financial statements of TMC are for the year ended March 31, 2018. The auditors have
expressed an unmodified opinion on these consolidated financial statements.
16.1.2 Toyota Tsusho Corporation (TTC) is incorporated in Japan. The registered address of TTC is 9-8,
Meieki 4-Chome, Nakamura-ku, Nagoya 450-8575, Japan. TTC is primarily engaged in production
and sale of automobiles and provision of related services. The President and Chief Executive Officer
of TTC is Mr Ichiro Kashitani. The latest available audited consolidated financial statements of TTC
are for the year ended March 31, 2018. The auditors have expressed an unmodified opinion on
these consolidated financial statements.
Note 2018 2017

17 RESERVES -------(Rupees in ‘000)-------
Capital reserve
Share premium 17.1 196,500 196,500
Revenue reserves
General reserve
Balance brought forward 23,451,050 19,851,050
Transferred from unappropriated profit 4,000,000 3,600,000
27,451,050 23,451,050
Unappropriated profit 8,310,792 6,763,412

35,958,342 30,410,962
17.1 This reserve can be utilised by the Company only for the purposes specified in section 81 of the
Companies Act, 2017.

Note 2018 2017

-------(Rupees in ‘000)-------
18 TRADE PAYABLES, OTHER PAYABLES AND PROVISIONS
Trade creditors
- Associated undertakings / related parties 293,998 111,219
- Others 1,964,451 1,247,540
Bills payable to Toyota Motor Corporation - a related party 3,292,331 858,078
Accrued liabilities 18.1 3,902,881 2,605,486
Royalty payable to associated undertakings / related parties 735,720 555,461
Deposits from dealers 18.2 156,550 156,550
Retention money 67,257 21,115
Workers’ Welfare Fund 503,115 390,625
Technical fee 6,075 5,246
Warranty obligations 18.3 1,237,520 1,070,973
Payable to dealers 963,140 805,179
Payable to customers 111,398 153,250
Mark-up on advances received from customers 208,993 117,218
Sales tax – net 1,055,440 267,199
Withholding income tax payable 479,370 336,801
Payable to Pension Fund – net 18.4 9,118 1,659
Other government levies payable 743,884 811,979
15,731,241 9,515,578
18.1 These include an amount of Rs 75.985 million (2017: Rs 34.361 million) payable to related parties.
18.2 These represent interest free deposits received from dealers in accordance with the terms of the
dealership agreements. These deposits have been utilised for the purpose of the Company’s
business.
Note 2018 2017

18.3 Warranty obligations -------(Rupees in ‘000)-------
Opening balance 1,070,973 938,630

Charge for the year 25 263,383 208,541
1,334,356 1,147,171
Utilisation during the year (96,836) (76,198)
Closing balance 1,237,520 1,070,973
18.4 Payable to Pension Fund – net
Receivable from Pension Fund - Defined Contribution Plan - (1,823)

Payable to Pension Fund - Defined Benefit Plan 27.2 9,118 3,482
9,118 1,659
19 ADVANCES FROM CUSTOMERS AND DEALERS
These represent advances received by the Company from customers and dealers in respect of sale
of vehicles, parts and extended warranty services against vehicles.
128

20 SHORT-TERM RUNNING FINANCES
As at June 30, 2018, the Company has unutilised short-term running finance facilities under mark-
up arrangements aggregating Rs 3,550 million (2017: Rs 3,550 million) available from various
commercial banks carrying mark-up rates based on 1 month KIBOR as benchmark rate plus 25
basis points (2017: 1 month KIBOR plus 25 basis points). The above facilities include an amount
of Rs 300 million (2017: Rs 300 million) available from Habib Metropolitan Bank Limited - a related
party.
The Company also has facilities for opening letters of credit and bank guarantees under mark-up
arrangements as at June 30, 2018 amounting to Rs 43,900 million (2017: Rs 32,000 million) from
various commercial banks, including Rs 9,500 million (2017: Rs 9,000 million) available from Habib
Metropolitan Bank Limited - a related party. The unutilised balance as at June 30, 2018 is Rs 25,216
million (2017: Rs 16,269 million).
The above mentioned short-term running finance facilities and bank guarantees are secured by pari
passu hypothecation charge on movable assets and receivables of the Company.
21 TAXATION - net
The income tax assessments of the Company have been finalised by the Income Tax Department
or deemed to be assessed under section 120 of the Income Tax Ordinance, 2001 up to the year
ended June 30, 2017.
22 CONTINGENCIES AND COMMITMENTS
Contingencies
22.1 The Company, during the years 2005-2006 and 2006-2007, received demand notices from the
Collector of Customs, claiming short recovery of Rs 480.311 million in aggregate on account of
customs duty amounting to Rs 305.426 million and sales tax amounting to Rs 174.885 million on
royalty payment to the Joint Venture Partner, Toyota Motor Corporation. The demand had been
raised based on the view that royalty value should be included as part of imported CKD kits which
is opposed to the view of the Company based on factual position that the royalty pertains to locally
deleted parts.
During year ended June 30, 2008, the Customs, Excise and Sales Tax Appellate Tribunal (the
Appellate Tribunal) decided the case in the Company’s favour and accordingly, the demand to the
extent of Rs 370.373 million (customs duty of Rs 235.775 million and sales tax of Rs 134.598 million)
had been reversed. During the year ended June 30, 2010, an appeal was filed by the Custom
Authorities before the Sindh High Court against the decision the Appellate Tribunal, which is pending.
Appeals are pending before the Collector of Customs Appeal for Rs 69.651 million and before the
Appellate Tribunal for Rs 40.287 million.
During the current year, the Company received a show cause notice from the Collector of Customs,
claiming short recovery of Rs 2,232.149 million (custom duty of Rs 1,135.778 million, sales tax of
Rs 795.319 million and income tax of Rs 301.052 million) on royalty payment to the Joint Venture
Partner, Toyota Motor Corporation. The Company has filed a petition against the same before the
Sindh High Court, which is pending for hearing.
In respect of pending appeals at various appellate forums, a similar favourable decision as made by
the Appellate Tribunal in the past is expected as the facts are common and involve identical question
of law. Therefore, no provision has been made by the Company in these financial statements against
the above mentioned sums as the management is confident that the matters will be decided in
favour of the Company.

22.2 During the year ended June 30, 2017, the Company received an Assessment Order from the
Punjab Revenue Authority, claiming that the Company was required to pay sales tax on franchise
services provided in the province of Punjab, as per the Second Schedule of the Punjab Sales Tax on
Services Act, 2012. The order further stated that the Company was required to pay Punjab Sales
Tax amounting to Rs 461.716 million along with penalty amounting to Rs 111.918 million relating to
the period from April 2013 to December 2016.
During the current year, the Company received show cause notices from the Punjab Revenue
Authority for recovery of Punjab Sales Tax amounting to Rs 77.698 million for the period from January
2017 to June 2017. Based on legal advice and merits of the case, the Company has obtained stay
orders against the demands and expects a favourable outcome. Hence, no provision has been
made in these financial statements.
22.3 As at June 30, 2018, the claims not acknowledged as debts by the Company, other than those
separately disclosed above, amount to Rs 1,137.611 million (2017: Rs 1,008.465 million).
Note 2018 2017

-------(Rupees in ‘000)-------
Cases filed by the dealers 300,000 300,000

Cases filed by government authorities 485,016 443,240
Others 352,595 265,225
22.3.1 1,137,611 1,008,465
22.3.1 The above cases represent legal proceedings initiated against the Company by various parties
therefore pending adjudication in various courts and legal forums of Pakistan since many years. A
few cases have been added during the current year. The management of the Company is of the view
that the Company has a strong position in these cases and these cases will be decided in the favour.
Hence, no provision has been recorded in respect of these cases in these financial statements.
22.3 Commitments 2018 2017

-------(Rupees in ‘000)-------
22.3.1 Outstanding bank guarantees 13,234,038 13,228,265
Outstanding bank guarantees include an amount of Rs 5,287.496 million (2017: Rs 5,570.123

million) in respect of bank guarantees from Habib Metropolitan Bank Limited - a related party.
22.3.2 Commitments in respect of capital expenditure as at June 30, 2018 amounted to Rs 3,028.016
million (2017: Rs 1,355.781 million).
22.3.3 Commitments in respect of letters of credit, other than for capital expenditure, amounted to Rs
3,244.144 million (2017: Rs 2,508.535 million). The above letters of credit include an amount of Rs
1,411.699 million (2017: Rs 1,087.525 million) availed from Habib Metropolitan Bank Limited - a
related party.
130

22.3.4 Commitments in respect of land rent and maintenance charges against leasehold land from Port
Qasim Authority as at June 30, 2018 amounted to Rs 205.443 million (2017: Rs 211.362 million).
Year 2018 2017

-------(Rupees in ‘000)-------
2018-2019 - 5,919
2019-2020 6,215 6,215
2020-2021 6,525 6,525
2021-2022 6,852 6,852
2022-2023 7,194 7,194
2023 onwards 178,657 178,657
205,443 211,362
23 OPERATING RESULTS
Manufacturing Trading Total
Note 2018 2017 2018 2017 2018 2017
--------------------------------------------- (Rupees in ‘000) ---------------------------------------------
Gross sales 23.1 158,491,245 125,843,970 10,336,558 9,837,795 168,827,803 135,681,765
Sales tax (22,729,667) (18,273,777) (1,161,204) (1,160,888) (23,890,871) (19,434,665)
23.2 135,761,578 107,570,193 9,175,354 8,676,907 144,936,932 116,247,100
Commission (3,983,232) (3,261,695) (327,097) (361,291) (4,310,329) (3,622,986)
Discounts (8,516) (4,254) (410,563) (348,204) (419,079) (352,458)
Net sales 131,769,830 104,304,244 8,437,694 7,967,412 140,207,524 112,271,656
Cost of sales 24 (110,061,113) (87,359,064) (5,769,658) (5,090,891) (115,830,771) (92,449,955)
Gross profit 21,708,717 16,945,180 2,668,036 2,876,521 24,376,753 19,821,701
Distribution expenses 25 1,143,656 1,082,079 140,233 145,568 1,283,889 1,227,647
Administrative expenses 26 1,432,098 978,589 91,702 74,751 1,523,800 1,053,340
(2,575,754) (2,060,668) (231,935) (220,319) (2,807,689) (2,280,987)
19,132,963 14,884,512 2,436,101 2,656,202 21,569,064 17,540,714
Other operating expenses 28 (181,968) (164,363) (11,652) (12,555) (193,620) (176,918)
Workers’ Profit Participation
Fund and Workers’ Welfare Fund 29 (1,704,557) (1,418,456) - - (1,704,557) (1,418,456)
17,246,438 13,301,693 2,424,449 2,643,647 19,670,887 15,945,340
Other income 30 3,900,685 3,593,425
23,571,572 19,538,765
Finance cost 31 (572,406) (397,998)
23.1 During the current year, there were no export sales of own manufactured vehicles and spare
parts, however, in 2017 export sales of own manufactured vehicles and spare parts amounted to
Rs 2.042 million and Rs 12.294 million respectively.
23.2 The gross sales, net of sales tax, for ‘Trading’ segment include an amount of Rs 1,409.185 million
(2017: Rs 1,203.329 million) in respect of sales of motor oil.

23.3 Other operating expenses, administrative expenses and distribution expenses (excluding warranty
claims, pre-delivery inspection and service charges, development expenditure, transportation and
running royalty), are allocated between manufacturing and trading activities on the basis of net sales.
Warranty claims, pre-delivery inspection and service charges, development expenditure, Workers’
Profit Participation Fund and Workers’ Welfare Fund are allocated to manufacturing activity. Running
royalty and transportation charges are allocated to trading activity.
Note 2018 2017

-------(Rupees in ‘000)-------
24 COST OF SALES
Raw materials and vendor parts consumed

Opening stock 7,500,220 5,964,095
Purchases 101,424,363 81,173,819
Closing stock 8 (8,515,842) (7,500,220)
100,408,741 79,637,694
Stores and spares consumed 1,449,886 1,281,744

Salaries, wages and other benefits 24.1 1,881,184 1,297,451
Rent, rates and taxes 4,366 9,584
Repairs and maintenance 562,585 504,156
Depreciation 3.4 1,800,608 1,509,613
Legal and professional 2,717 4,742
Travelling 28,523 34,523
Transportation 8,647 5,266
Insurance 33,552 37,630
Vehicle running 17,881 15,697
Communication 4,219 2,511
Printing, stationery and office supplies 3,049 2,746
Subscription 729 478
Fuel and power 447,968 420,850
Running royalty 24.2 2,634,003 2,190,742
Supervisor fee 39,663 7,197
Technical fee 35,130 10,292
Staff catering, transport and uniforms 442,824 332,345
Provision for slow moving stock-in-trade / (reversal of provision) 3,299 (10,806)
Provision for slow moving stores and spares / (reversal of provision) 21,603 (23,883)
Others 12,621 22,651
9,435,057 7,655,529
109,843,798 87,293,223
Add: Opening work-in-process 516,783 549,799
Less: Closing work-in-process 8 518,329 516,783
109,842,252 87,326,239
Opening stock of finished goods - own manufactured 420,480 453,305
Closing stock of finished goods - own manufactured 8 (201,619) (420,480)
Cost of sales - own manufactured 110,061,113 87,359,064
Opening stock of finished goods - trading 1,014,483 997,409

Finished goods purchased 6,807,503 5,142,439
Closing stock of finished goods - trading 8 (2,064,778) (1,014,483)
Provision for slow moving stock-in-trade / (reversal of provision) 12,450 (34,474)
Cost of sales - trading 5,769,658 5,090,891
115,830,771 92,449,955
132

24.1 These include an amount of Rs 34.390 million (2017: Rs 29.342 million) in respect of charge against
provident fund and Rs 22.752 million (2017: Rs 21.937 million) in respect of charge against pension
fund.
24.2 This includes royalty paid to the following parties:

Relationship
Name Address with the 2018 2017
Company
(Rupees in ‘000)
Toyota Motor 1 Toyota-Cho, Toyota City, Aichi

Associate 1,700,862 1,976,088
Corporation Prefecture 471-8571, Japan
Toyota Daihatsu
99 Moo 5, T. Ban-Ragad, A. Bank-bo,
Engineering &
Samutprakran, 10560, Kingdom of Group company 9,702 6,972
Manufacturing
Thailand
Company Limited
Note 2018 2017

25 DISTRIBUTION EXPENSES -------(Rupees in ‘000)-------
Salaries, wages and other benefits 25.1 289,837 247,627

Depreciation 3.4 37,727 36,915
Advertising and sales promotion 436,415 505,875
Staff training 10,201 6,293
Staff transport and canteen 21,527 18,439
Subscription 362 298
Warranty claims 18.4 263,383 208,541
Pre-delivery inspection and service charges 52,878 58,300
Development expenditure 17,789 12,859
Utilities 120 311
Transportation 61,069 60,225
Running royalty 25.2 27,322 24,052
Reversal of provision for doubtful debts and bad debts - (22,979)
Others 3,021 3,216
1,283,889 1,227,647
provident fund and Rs 5.504 million (2017: Rs 0.782 million - reversal) in respect of charge against
pension fund.
25.2 This includes royalty paid to the following parties:

Relationship
Name Address with the 2018 2017
Company
(Rupees in ‘000)
Toyota Motor 1 Toyota-Cho, Toyota City, Aichi

Associate 18,842 20,903
Corporation Prefecture 471-8571, Japan
1-78-1, Hanshin Ryutsu Center,
Daihatsu Motor
Company Limited
Yamaguchi Nishinomiya, Hyogo, 651- Group company - 572
1431, Japan

Note 2018 2017

26 ADMINISTRATIVE EXPENSES -------(Rupees in ‘000)-------
Salaries, wages and other benefits 26.1 680,995 392,357

Insurance 40,408 34,818
Depreciation 3.4 53,543 33,974
Amortisation 3.2 31,856 22,439
Legal and professional 230,200 185,093
Director’s fee 1,125 1,250
Staff training 151,901 87,632
Staff transport and canteen 49,297 63,579
Security 39,722 37,162
Subscription 5,234 3,592
Utilities 329 451
Share registrar and related expenses 8,875 8,139
Others 35,504 1,271
1,523,800 1,053,340
provident fund and Rs 7.971 million (2017: Rs 0.533 million) in respect of charge against pension
fund.
27 DEFINED BENEFIT PLAN - Approved Pension Fund
As mentioned in note 2.3.13, the Company operates an approved pension fund for its permanent
employees who are governed under the Old Rules. The latest actuarial valuation of the Company’s
pension fund, based on Projected Unit Credit Actuarial Cost Method, was carried out as at June 30,
2018. The pension fund exposes the Company to the following risks:
Mortality risks
The risk that the actual mortality rates are different. The effect depends on the beneficiaries’ service
/ age distribution and the benefit.
Investment risks
The risk of the investments underperforming and not being sufficient to meet the liabilities.
Final salary risks
The risk that the final salaries at the time of cessation of service are greater than what was assumed.
Since the benefit is calculated on the basis of final salary of an employee, the amount of the benefit
increases with any increase in the final salary.
Withdrawal risks
The risk of higher or lower withdrawals than assumed. The final effect could go either way depending
on the beneficiaries’ service / age distribution and the benefits payable.
The Company has recognised the following amounts in these financial statements for its obligations
towards the respective members.
134

27.1 Principal actuarial assumptions 2018 2017

(% per annum)
Discount factor used 11.25 10.50
Expected rate of salary increase 10.25 9.50
Expected rate of return on plan assets 13.90 10.50
Expected rate of increase in long term pension 6.25 5.50
Note 2018 2017

27.2 The amounts recognised in the statement of financial ------(Rupees in ‘000)------
position are determined as follows:
Present value of defined benefit obligation 27.4 42,856 31,355

Fair value of plan assets 27.3 & 27.4 (33,738) (27,873)
9,118 3,482
27.3 Plan assets consist of the following:
2018 2017
Quoted Non-Quoted Quoted Non-Quoted
------------------------ Rupees ‘000 ------------------------
Balances with banks - 4,363 - 10,154
Equity instruments 8,024 - 6,653 -
Debt instruments - Government - 20,694 - 11,066
Others - 657 - -
8,024 25,714 6,653 21,220
27.4 The movement in the net defined benefit obligation over the year is as follows:
2018
Present
value of Fair value
defined of plan Total
benefit assets
obligation
--------------(Rupees in ‘000)--------------
At July 1 31,355 (27,873) 3,482

Current service cost 1,936 - 1,936
Interest expense / (income) 3,377 (3,875) (498)
36,668 (31,748) 4,920
Remeasurements:
Loss on plan assets, excluding amounts
included in interest expense - 2,387 2,387
Loss from change in financial assumptions 6,740 - 6,740
6,740 2,387 9,127
43,408 (29,361) 14,047
Contribution - (4,929) (4,929)
Benefit payments (552) 552 -
At June 30 42,856 (33,738) 9,118

2017
Present
value of
Fair value of
defined Total
plan assets
benefit
obligation
------------(Rupees in ‘000)------------
At July 1 23,305 (21,412) 1,893

Current service cost 1,348 - 1,348
Interest expense / (income) 2,505 (2,315) 190
27,158 (23,727) 3,431
Remeasurements:
Return on plan assets, excluding amounts
included in interest expense - (2,017) (2,017)
Gain from change in financial assumptions 4,749 - 4,749
4,749 (2,017) 2,732
31,907 (25,744) 6,163
Contribution - (2,681) (2,681)
Benefit payments (552) 552 -
At June 30 31,355 (27,873) 3,482
2018 2017
27.5 Charge for defined benefit plan recognised in the ------(Rupees in ‘000)------
statement of profit or loss
Current service cost 1,936 1,348

Net interest (income) / expense (498) 190
1,438 1,538
27.6 The sensitivities of the net defined benefit obligation to changes in the weighted principal assumptions
are as under:
Amount of net defined benefit

obligation
Change in Increase in Decrease in
assumption assumption assumption
------(Rupees in ‘000)-----
Discount rate 1% 36,011 51,532

Long term salary increases 1% 46,388 39,658
Pension increase rate 1% 47,634 38,782
The above sensitivity analysis is based on a change in an assumption while holding all other
assumptions constant. When calculating the sensitivity of the net defined benefit obligation to
significant actuarial assumptions the same method (present value of the defined benefit obligation
calculated with the projected unit credit method at the end of the reporting period) has been applied
as when calculating the pension liability recognised within the statement of financial position.
27.7 The weighted average duration of the net defined benefit obligation is 16.89 years.
27.8 Expected maturity analysis of undiscounted net defined benefit obligation for the pension fund is as
follows:
136

Less than Between Between Over 4

At June 30, 2018 Total
a year 1-2 years 2-4 years years
-------------------------- Rupees ‘000 --------------------------
Pension 294 635 1,480 11,616 14,025
27.9 The expected return on plan assets is determined by considering the expected long-term returns
available on the assets underlying the current investment policy. Expected yield on fixed interest
investments are based on gross redemption yield as at the statement of financial position date.
Expected returns on equity are based on long-term real rates experienced in the stock market.
27.10 The expected charge for the defined benefit plan for the year ending June 30, 2019 is Rs 3.908
million.
27.11 The charge for the year in respect of pension amounts to Rs 36.227 million (2017: Rs 21.688
million), which includes Rs 34.789 million (2017: Rs 20.150 million) in respect of members covered
under New Rules and Rs 1.438 million (2017: Rs 1.538 million) in respect of members covered
under Old Rules.
Note 2018 2017

28 OTHER OPERATING EXPENSES ------(Rupees in ‘000)------
Auditors’ remuneration 28.1 3,090 2,943

Donations 28.2 190,530 173,975
193,620 176,918
28.1 Auditors’ remuneration
Audit fee 1,575 1,575

Interim review and other certifications 868 675
Out-of-pocket expenses 647 693
3,090 2,943
28.2 Donations
28.2.1 Donations in which a Director or his spouse is interested are as follows:
Name of Interest in Name of Donee 2018 2017

Director(s) Donee ------(Rupees in ‘000)------
1. Mr Ali S. Habib Trustee Mohamedali Habib Welfare Trust 3,000 2,250

2. Mr Ali S. Habib and
Mr Mohammedali R. Habib Trustee Habib Education Trust 7,944 6,700
3. Mr Ali S. Habib,
Mr Mohammedali R. Habib
and Mr Parvez Ghias Director Habib University Foundation 90,500 83,216
28.2.2 The names of donees, other than those disclosed above, to whom the donation amount during
the current year exceeds Rs 500,000 are Patients Aid Foundation, The Citizen Foundation, Indus
Hospital, Toyota Citizen Foundation (Toyota Goth Education Program), Sindh Institute of Urology &
Transplantation (SIUT), Ghulaman-e-Abbas Education & Medical Trust and Thar Foundation.

Note 2018 2017

-----(Rupees in ‘000)-----
29 WORKERS’ PROFIT PARTICIPATION FUND AND WORKERS’
WELFARE FUND
Workers’ Welfare Fund 469,371 390,625

Workers’ Welfare Fund - for prior years - (130)
Workers’ Profit Participation Fund 13.4 1,235,186 1,027,961
1,704,557 1,418,456
30 OTHER INCOME
Income from financial assets

Return on bank deposits 1,897,142 1,571,383
Interest income on Market Treasury Bills 745,430 398,146
Amortisation income on Market Treasury Bills 116,764 46,078
Interest income on Pakistan Investment Bonds (PIBs) 26,214 569,869
Amortisation income on Pakistan Investment Bonds (PIBs) - 57,226
Gain on redemption of investments in Pakistan Investment Bonds (PIBs) 60,422 -
Gain on redemption of investments in listed mutual fund units 125,255 255,918
Unrealised gain on revaluation of listed mutual fund units 182,540 -
Income from other than financial assets

Agency commission, net of commission expense
of Rs 55.030 million (2017: Rs 16.817 million) 262,371 219,189
Exchange gain on agency commission and exports 30,333 888
Gain on disposal of operating fixed assets 3.5 43,643 22,943
Liabilities no longer payable written back 78,390 138,588
Freight and other charges income 297,050 277,813
Certification income 34,893 23,805
Exchange gain - net - 279
Others 238 11,300
3,900,685 3,593,425
Note 2018 2017

-----(Rupees in ‘000)-----
31 FINANCE COST
Mark-up on advances received from customers 492,095 329,112

Bank charges 80,311 68,886
572,406 397,998
32 TAXATION
Current - for the year 7,182,319 6,119,915

Current - for prior years (17,042) (105,885)
7,165,277 6,014,030
Deferred - for the year 62,029 125,472

32.1 7,227,306 6,139,502
138

2018 2017
-----(Rupees in ‘000)-----
32.1 Relationship between income tax expense and accounting profit
Tax at the applicable tax rate of 30% (2017: 31%) 6,899,750 5,933,638
Tax effect of permanent differences and super tax 807,343 719,476
Tax effect of income taxable at lower rates and tax credit on
plant and machinery (239,401) (15,932)
Tax effect of income assessed under final tax regime (227,653) (384,885)
Tax effect of change in tax rate for future periods 4,309 (6,910)
Prior years’ reversal (17,042) (105,885)
7,227,306 6,139,502
32.2 Management assessment of sufficiency of provision for income taxes
In the opinion of the management, sufficient tax provision has been made in these financial
statements. Comparisons of tax provision as per the financial statements viz-a-viz tax assessments
for the last three years is as follows:
2017 2016 2015
----------------(Rupees in ‘000)----------------
Tax assessed as per the most recent tax assessment 5,469,376 5,612,810 5,137,876
Provision in accounts for income tax 6,119,915 6,073,923 5,139,411
The Company has made provisions for taxation in its financial statements based on applicable tax
laws and decisions of appellate authorities on similar matters. Provisions in respect of super tax and
other matters have been made in the respective years, against which petitions have been filed by
the Company before the Sindh High Court.
33 EARNINGS PER SHARE
33.1 Basic
Basic earnings per share has been computed by dividing the profit for the year after taxation by the
weighted average number of shares outstanding during the year.
2018 2017
-----(Rupees in ‘000)-----
(Number of Shares)
Weighted average number of ordinary shares outstanding during the year 78,600,000 78,600,000
(Rupees)
Basic earnings per share 200.66 165.41
33.2 Diluted
There are no potential dilutive ordinary shares outstanding as at June 30, 2018 and 2017.

Note 2018 2017

-------(Rupees in ‘000)-------
34 CASH GENERATED FROM OPERATIONS
Adjustment for non-cash charges and other items:

Depreciation 3.2 1,891,878 1,580,502
Amortisation 3.2 31,856 22,439
Reversal of provision for doubtful debts and bad debts - (22,979)
Gain on disposal of operating fixed assets 3.5 (43,643) (22,943)
Gain on redemption of investments in Pakistan Investment Bonds (PIBs) 30 (60,422) -
Gain on redemption of investments in listed mutual fund units 30 (125,255) (255,918)
Unrealised gain on revaluation of listed mutual fund units 30 (182,540) -
Net unrealised gain on revaluation of foreign exchange
contracts - fair value hedge 3,225 32,128
Return on bank deposits 30 (1,897,142) (1,571,383)
Interest income on Pakistan Investment Bonds (PIBs) 30 (26,214) (569,869)
Amortisation income on Pakistan Investment Bonds (PIBs) 30 - (57,226)
Interest income on Market Treasury Bills 30 (745,430) (398,146)
Amortisation income on Market Treasury Bills 30 (116,764) (46,078)
Charge in respect of Workers’ Profit Participation Fund 29 1,235,186 1,027,961
Charge in respect of Workers’ Welfare Fund 29 469,371 390,495
Mark-up on advances received from customers 31 492,095 329,112
Working capital changes 34.1 6,467,560 618,363
30,392,927 20,197,225
34.1 Working capital changes
(Increase) / decrease in current assets

Stores and spares (97,425) (50,268)
Stock-in-trade (1,832,853) (1,532,638)
Trade debts (694,798) 395,809
Loans and advances (2,061,748) (527,416)
Short-term prepayments 6,200 24,681
Other receivables (160,267) (210,805)
(4,840,891) (1,900,637)
Increase / (decrease) in current liabilities
Current portion of deferred revenue 3,933 -
Trade payables, other payables and provisions 6,002,271 (542,521)
Advances from customers and dealers 5,302,247 3,061,521
11,308,451 2,519,000
6,467,560 618,363
35 CASH AND CASH EQUIVALENTS
Cash and cash equivalents included in the statement of cash flows comprise of the following:
Note 2018 2017

-------(Rupees in ‘000)-------
Cash and bank balances 15 2,200,772 3,221,120

Term Deposit Receipts (TDRs) 14 35,000,000 24,200,000
Government securities - Market Treasury Bills 14 10,842,407 5,178,600
48,043,179 32,599,720
140

36 REMUNERATION OF CHIEF EXECUTIVE, DIRECTORS AND EXECUTIVES
2018 2017
Chief Chief
Directors Executives Directors Executives
Executive Executive
------------------------------------- (Rupees in ‘000) -------------------------------------
Managerial remuneration * 42,046 11,438 274,966 33,051 12,973 235,348

Retirement benefits 3,059 - 20,696 1,421 - 12,122
Medical expenses 211 - - 147 - -
45,316 11,438 295,662 34,619 12,973 247,470
Number of persons 1 2 49 1 2 40
* This includes bonus, house rent, utilities and other allowances.
36.1 The Chief Executive, directors and some executives have been provided free use of Company
maintained cars, residential telephones and club facilities.
36.2 During the year, an amount of Rs 1.125 million (2017: Rs 1.250 million) has been paid to a non-
executive director, as fee for attending board and other meetings.
37 TRANSACTIONS AND BALANCES WITH ASSOCIATED UNDERTAKINGS / RELATED PARTIES
The associated undertakings / related parties comprise of associated companies, staff retirement
funds and key management personnel. Transactions carried out with associated undertakings /
related parties during the year, not disclosed elsewhere in the financial statements are as follows:
2018 2017
With associated undertakings / related parties: ------(Rupees in ‘000)------
Sales 213,068 241,075

Purchases 63,842,123 54,005,416
Insurance premium 76,118 86,755
Agency commission 317,402 236,006
Running royalty 2,577,372 2,206,439
Rent expense 1,244 2,120
Return on bank deposits 729,901 714,725
Proceeds from disposal of operating fixed assets / insurance claim 4,324 2,505
Supervisor fee 39,663 7,197
Bank charges 58,908 56,155
LC charges 7,963 6,349
With key management personnel:

Salaries and benefits 186,109 163,799
Post employment benefits 12,368 9,873
Sale of operating fixed assets 9,077 1,394
37.1 Contribution to and accruals in respect of staff retirement benefits are made in accordance with
actuarial valuations / terms of contribution plan as disclosed in the respective notes to these financial
statements.
37.2 The status of outstanding balances with associated undertakings / related parties as at June 30,
2018 are included in the respective notes to the financial statements.

37.3 The names of related parties (other than those that have been specifically disclosed elsewhere in
these financial statements) with whom the Company has entered into transactions or had agreements
/ arrangements in place during the year are as follows:
Basis of relationship
Percentage of
Common directorship Name Particulars of Common director(s)
shareholding (%)
Dawood Hercules
Nil Mr Parvez Ghias
Corporation Limited
Shell Pakistan Limited Nil Mr Parvez Ghias
Shabbir Tiles & Ceramics

Nil Mr Ali S. Habib
Limited
Cherat Cement Company
Nil Mr Azam Faruque
Limited
Thal Limited 6.22% Mr Ali S. Habib and Mr Mohamedali R. Habib
Habib Insurance Company

0.05% Mr Mohamedali R. Habib
Limited
Habib Metro Pakistan
Nil Mr Ali S. Habib
(Private) Limited
Habib University Nil Mr Ali S. Habib being governor
Mohamedali Habib
0.01% Mr Ali S. Habib being trustee
Welfare Trust
Mr Ali S. Habib and Mr Mohamedali R. Habib
Habib Education Trust Nil
being trustees
Mr Ali S. Habib, Mr Mohamedali R. Habib
Habib University Foundation Nil
and Mr Parvez Ghias
Habib Metropolitan Bank
Nil Mr Ali S. Habib and Mr Mohamedali R. Habib
Limited
Percentage of
Group companies Name Relationship with the Company
shareholding (%)
Toyota Tsusho Corporation 12.50% Joint Venture Partner
Toyota Motor Corporation 25.00% Joint Venture Partner
Toyota Motor Asia Pacific

Nil Subsidiary of Toyota Motor Corporation
PTE. Limited
Toyota Tsusho (Thailand)

Nil Subsidiary of Toyota Tsusho Corporation
Company Limited
Toyotsu Machinery
Corporation
Toyota Daihatsu Engineering
& Manufacturing Nil Subsidiary of Toyota Motor Corporation
Company Limited
Toyota Tsusho Asia Pacific
PTE. Limited
Daihatsu Motor Company

Nil Subsidiary of Toyota Motor Corporation
Limited
Hinopak Motors Limited Nil Subsidiary of Toyota Motor Corporation
142

2018 2017
38 PLANT CAPACITY AND PRODUCTION Number of units
Capacity based on double shift basis 54,800 54,800

Production 62,886 59,945
The Company has been operating on a double shift basis from March 2003 based on market
demand. The capacity has been calculated based on average normal working hours in a year,
whereas actual production may vary in response to market demand. During the year, the Company
operated the plant for more than normal working hours.
2018 2017
Un-audited Audited
-------(Rupees in ‘000)-------
39 DISCLOSURE RELATING TO PROVIDENT FUND
(i) Size of the fund 828,196 781,657

(ii) Cost of investments made 744,152 690,243
(iii) Percentage of investments made 89.85% 88.31%
(iv) Fair value of investments 733,069 711,302
Breakup of investments 2018 2017
Rupees in ‘000 Percentage Rupees in ‘000 Percentage
Government Securities 542,247 73.97% 535,083 75.23%

Listed Securities 190,822 26.03% 176,219 24.77%
733,069 100.00% 711,302 100.00%
The above investments have been made in accordance with the provisions of section 218 of the
Companies Act, 2017 and the conditions specified thereunder.
2018 2017
(Number of staff)
40 NUMBER OF EMPLOYEES
Total number of employees as at June 30 3,266 2,849
Total number of factory employees as at June 30 2,795 2,414
Average number of employees during the year 3,034 2,842
Average number of factory employees during the year 2,585 2,380

41 FINANCIAL INSTRUMENTS BY CATEGORY
---------------------As at June 30, 2018---------------------

Fair value
Loans and Held to
through profit Total
receivables maturity
or loss
------------------------Rupees in ‘000 ------------------------
Financial assets
Loans and advances 1,471,015 - - 1,471,015
Long-term deposits 9,443 - - 9,443
Trade debts 1,453,670 - - 1,453,670
Accrued return 120,016 - - 120,016
Other receivables 549,205 - - 549,205
Investments - 45,959,172 9,071,931 55,031,103
Cash and bank balances 2,200,772 - - 2,200,772
5,804,121 45,959,172 9,071,931 60,835,224
----As at June 30, 2018----

Financial
liabilities at
Total
amortised
cost
-------Rupees in ‘000 -------
Financial liabilities
Unpaid dividend 60,445 60,445
Trade payables, other payables and provisions 12,949,432 12,949,432
13,192,314 13,192,314
--------------As at June 30, 2017--------------

Loans and Held to
Total
receivables maturity
---------------Rupees in ‘000 ---------------
Financial assets
Loans and advances 1,042,312 - 1,042,312
Long-term deposits 9,443 - 9,443
Trade debts 758,872 - 758,872
Accrued return 376,037 - 376,037
Other receivables 365,039 - 365,039
Investments - 41,487,709 41,487,709
Cash and bank balances 3,221,120 - 3,221,120
5,772,823 41,487,709 47,260,532
-----As at June 30, 2017-----

Financial
liabilities at Total
amortised cost
--------Rupees in ‘000 --------
Trade payables, other payables and provisions 7,708,974 7,708,974
7,876,275 7,876,275
144

42 FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES
The Company’s activities expose it to certain financial risks. Such financial risks emanate from various
factors that include, but are not limited to market risk, credit risk and liquidity risk.
The Company currently finances its operations through equity and management of working capital
with a view to maintain an appropriate mix between various sources of finance to minimise risk. The
Company’s risk management policies and objectives are as follows:
42.1 Credit risk exposure and concentration of credit risk
Credit risk represents the risk of a loss if the counter party fails to discharge its obligation and causes
the other party to incur a financial loss. The Company attempts to control credit risk by monitoring
credit exposures, limiting transactions with specific counterparties and continually assessing the
creditworthiness of counterparties.
Concentration of credit risk arises when a number of counterparties are engaged in similar business
activities or have similar economic features that would cause their ability to meet contractual obligations
to be similarly affected by changes in economic, political or other conditions. Concentration of credit
risk indicates the relative sensitivity of the Company’s performance to developments affecting a
particular industry.
Credit risk arises from derivative financial instruments, investments (except for the investments in
Government securities) and balances with banks and financial institutions, as well as credit exposures
to customers, employees including trade debts, other receivables and committed transactions with
the group companies. Out of the total financial assets of Rs 60,835.224 million (2017: Rs 47,260.532
million), the financial assets which are subject to credit risk amounted to Rs 49,873.180 million (2017:
Rs 36,969.924 million), including trade receivables from government agencies.
Out of the total trade debts amounting to Rs 1,453.670 million (2017: Rs 758.872 million), an amount
of Rs 825.580 million (2017: Rs 202.166 million) relates to direct customers.
Out of the total bank balance and TDRs of Rs 37,197.900 million (2017: Rs 34,418.221 million)
placed with banks, amounts aggregating to Rs 37,186.551 million (2017: Rs 28,903.643 million) have
been placed with banks having credit rating of AA+ and above, whereas the remaining amounts are
placed with banks having long term minimum credit rating of AA.
Due to the Company’s long standing business relationships with its counterparties and after giving
due consideration to their strong financial standing, management does not expect non–performance
by these counter parties on their obligations to the Company.
For trade debts, internal risk assessment process determines the credit quality of each customer,
taking into account their financial position, past experience and other factors. Individual risk limits
are set based on internal or external ratings in accordance with limits set by the management. The
utilisation of credit limits is regularly monitored. Accordingly, the management believes that the
credit risk is minimal and in the opinion of the management, the Company is not exposed to major
concentration of credit risk.
42.2 Liquidity risk
Liquidity risk is the risk that the Company will be unable to meet its funding requirements. To guard
against this risk, the Company has diversified funding sources and assets are managed with liquidity in
mind, maintaining a healthy balance of cash and cash equivalents. The maturity profile of trade debts
is monitored to ensure adequate liquidity is maintained. The management forecasts the liquidity of
the Company on the basis of expected cash outflows considering the level of liquid assets necessary
to meet such outflows.
The maturity profile of the Company’s liability based on contractual maturities is disclosed in note
42.3.2 to these financial statements.

42.3 Market Risk
Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate
because of changes in market prices. Market risk comprises of three types of risks: currency risk,
interest rate risk and other price risk.
42.3.1 Currency risk
Foreign currency risk arises mainly where receivables and payables exist due to transactions entered
into in foreign currencies. The Company manages its exposure against foreign currency risk by
entering into foreign exchange contracts where considered necessary.
Foreign currency risk arises mainly where receivables and payables exist due to transactions entered
into in foreign currencies. The Company primarily has foreign currency exposures in US Dollars (USD),
Japanese Yen (JPY) and Thai Baht (THB). The net foreign currency exposure at June 30, 2018 is USD
6.103 million (2017: USD 10.588 million), JPY 1,383.229 million (2017: JPY 99.685 million) and THB
6.481 million (2017: THB Nil).
42.3.2 Interest rate risk
Interest / mark-up rate risk is the risk that the value of a financial instrument will fluctuate due to
changes in the market interest / mark-up rates. Sensitivity to interest / mark-up rate risk arises
from mismatches of financial assets and financial liabilities that mature or reprice in a given period.
The Company manages these mismatches through risk management strategies where significant
changes in gap position can be adjusted. The Company is exposed to interest / mark-up rate risk in
respect of the following:
---------------------------------------------------------------2018---------------------------------------------------------------
Effective Interest / mark-up bearing Non-interest / mark-up bearing Total

interest /
mark-up Maturity upto Maturity after Maturity upto Maturity after June 30,
Sub-total Sub-total
rate one year one year one year one year 2018
% ---------------------------------------------- (Rupees in ‘000) ----------------------------------------------
On statement of financial
position financial instruments
Financial assets
Loans and advances 3.00-3.50 21,819 18,525 40,344 1,430,671 - 1,430,671 1,471,015
Long-term deposits - - - - - 9,443 9,443 9,443
Trade debts - - - - 1,453,670 - 1,453,670 1,453,670
Accrued return - - - - 120,016 - 120,016 120,016
Other receivables - - - - 549,205 - 549,205 549,205
Investments 6.17 7.15 55,031,103 - 55,031,103 - - - 55,031,103
Cash and bank balances 2.40 6.05 1,874,395 - 1,874,395 326,377 - 326,377 2,200,772
56,927,317 18,525 56,945,842 3,879,939 9,443 3,889,382 60,835,224
Unclaimed dividend - - - - 182,437 - 182,437 182,437
Unpaid dividend - - - - 60,445 - 60,445 60,445
Trade payables, other
payables and provisions - - - - 12,949,432 - 12,949,432 12,949,432
- - - 13,192,314 - 13,192,314 13,192,314
146

---------------------------------------------------------------2017---------------------------------------------------------------
Effective Interest / mark-up bearing Non-interest / mark-up bearing Total
interest /
mark-up Maturity upto Maturity after Maturity upto Maturity after June 30,
Sub-total Sub-total
rate one year one year one year one year 2017
% ---------------------------------------------- (Rupees in ‘000) ----------------------------------------------
On statement of financial
position financial instruments
Financial assets
Loans and advances 3.00-3.50 16,932 7,910 24,842 1,017,470 - 1,017,470 1,042,312
Long-term deposits - - - - - 9,443 9,443 9,443
Trade debts - - - - 758,872 - 758,872 758,872
Accrued return - - - - 376,037 - 376,037 376,037
Other receivables - - - - 365,039 - 365,039 365,039
Investments 5.55 12.56 41,487,709 - 41,487,709 - - - 41,487,709
Cash and bank balances 3.50 6.35 3,189,103 - 3,189,103 32,017 - 32,017 3,221,120
44,693,744 7,910 44,701,654 2,549,435 9,443 2,558,878 47,260,532
Unclaimed dividend - - - - 167,301 - 167,301 167,301
Trade payables, other
payables and provisions - - - - 7,708,974 - 7,708,974 7,708,974
- - - 7,876,275 - 7,876,275 7,876,275
a) Sensitivity analysis of variable rate instruments
Presently, the Company does not hold any variable rate financial instruments.
b) Sensitivity analysis of fixed rate instruments
Fixed rate instruments comprise of Market Treasury Bills, TDRs, balances with banks and loans
to employees. The income from these financial assets are substantially independent of changes in
market interest rates except for changes, if any, as a result of fluctuation in respective fair values. The
Company’s income from these financial assets does not have any fair value impact since these are
classified as either held to maturity or loans and receivables.
42.3.3 Price risk
Price risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate as
a result of changes in market prices (other than those arising from interest rate risk or currency risk)
whether those changes are caused by factors specific to the individual financial instrument or its
issuer, or factors affecting all similar financial instruments traded in the market.
42.3.4 Fair value of financial instruments
Fair value is the amount for which an asset could be exchanged, or liability settled, between
knowledgeable willing parties in an arm’s length transaction. Consequently, differences can arise
between carrying values and the fair value estimates.
Underlying the definition of fair value is the presumption that the Company is a going concern
without any intention or requirement to curtail materially the scale of its operations or to undertake a
transaction on adverse terms.
Financial assets which are traded in an open market are revalued at the market prices prevailing on
the reporting date. The estimated fair value of all other financial assets and liabilities is considered
not significantly different from their carrying values as the items are either short term in nature or
periodically repriced.

International Financial Reporting Standard 7, ‘Financial Instruments: Disclosure’ requires the Company
to classify fair value measurements using a fair value hierarchy that reflects the significance of the
inputs used in making the measurements. The fair value hierarchy has the following levels:
- quoted prices (unadjusted) in active markets for identical assets or liabilities (level 1);
- inputs other than quoted prices included within level 1 that are observable for the asset or liability,
either directly (i.e., current market prices) or indirectly (i.e., derived from current market prices)
(level 2); and
- inputs for the asset or liability that are not based on observable market data (unobservable
inputs) (level 3).
The level in the fair value hierarchy within which the fair value measurement of a financial instrument is
categorised in its entirety shall be determined on the basis of the lowest level input that is significant
to the fair value measurement of that financial instrument.
------- As at June 30, 2018 ------- ------- As at June 30, 2017 -------
Level 1 Level 2 Level 3 Level 1 Level 2 Level 3
---------------------------------Rupees in ‘000---------------------------------
Financial assets ‘at fair value
through profit or loss’
- Listed mutual fund units 9,071,931 - - - - -
- Derivative financial instruments - - 14,013 - - 17,238
43 CAPITAL RISK MANAGEMENT
The Company’s objectives when managing capital are to safeguard the Company’s ability to continue
as a going concern in order to provide returns for shareholders and benefits for other stakeholders
and to maintain an optimal capital structure to reduce the cost of capital. The Company is currently
financing its operations through equity and working capital. The Company has no gearing risk in the
current year nor any in the prior year.
44 SUMMARY OF SIGNIFICANT TRANSACTIONS AND EVENTS DURING THE CURRENT YEAR
a) Due to first time application of financial reporting requirements under the Companies Act, 2017,
including disclosure and presentation requirements of the fourth schedule to the Companies Act,
2017, some additional disclosures have been added and some amounts reported for the previous
period have been reclassified in these financial statements.
b) During the year, the Company has made significant capitalisations in buildings and plant and
machinery on the completion of various ongoing projects including the extension of paint shop. The
Company also has various ongoing projects for which the Company has entered into significant
capital commitments.
45 NON-ADJUSTING EVENT AFTER THE STATEMENT OF FINANCIAL POSITION DATE
The Board of Directors in its meeting held on August 28, 2018 has proposed a cash dividend in
respect of the year ended June 30, 2018 of Rs 45 (2017: cash dividend of Rs 35) per share. This is in
addition to the interim cash dividend of Rs 95 (2017: Rs 80) per share resulting in a total dividend for
the year of Rs 140 (2017: Rs 115) per share. The Directors have also announced appropriation of Rs
4,500 million (2017: Rs 4,000 million) to general reserve. These appropriations will be approved in the
forthcoming Annual General Meeting. The financial statements for the year ended June 30, 2018 do
not include the effect of these appropriations which will be accounted for in the financial statements
for the year ending June 30, 2019.
148

46 GENERAL
Figures in these financial statements have been rounded off to the nearest thousand Rupees.
47 CORRESPONDING FIGURES
Corresponding figures have been rearranged and reclassified, wherever necessary, for the purpose of
better presentation and comparison and due to the applicability of the disclosure requirement of the
Fourth schedule of the Act, the effects of which are not material.
48 DATE OF AUTHORISATION
These financial statements were authorised for issue on August 28, 2018 by the Board of Directors
of the Company.


Pattern of Shareholding
As at June 30, 2018
Number of Shareholders / Folios Shareholdings’Slab Total Shares Held

895 1 to 100 44,114
2,223 101 to 500 990,890
296 501 to 1,000 259,920
338 1,001 to 5,000 815,288
75 5,001 to 10,000 562,408
25 10,001 to 15,000 295,459
22 15,001 to 20,000 391,350
12 20,001 to 25,000 274,140
13 25,001 to 30,000 365,510
7 30,001 to 35,000 222,556
10 35,001 to 40,000 377,150
4 40,001 to 45,000 206,093
3 45,001 to 50,000 142,460
4 50,001 to 55,000 213,798
8 55,001 to 60,000 457,197
3 65,001 to 70,000 204,000
1 70,001 to 75,000 74,890
1 75,001 to 80,000 79,532
1 90,001 to 95,000 93,882
4 95,001 to 100,000 394,135
1 100,001 to 105,000 103,700
1 105,001 to 110,000 105,415
1 110,001 to 115,000 113,480
3 115,001 to 120,000 350,330
1 125,001 to 130,000 130,000
1 130,001 to 135,000 135,000
1 135,001 to 140,000 137,540
1 145,001 to 150,000 150,000
1 150,001 to 155,000 154,140
1 160,001 to 165,000 162,040
1 185,001 to 190,000 186,860
1 210,001 to 215,000 213,500
1 240,001 to 245,000 243,000
4 255,001 to 260,000 1,032,667
1 270,001 to 275,000 272,384
1 275,001 to 280,000 276,660
1 285,001 to 290,000 286,380
1 290,001 to 295,000 290,500
1 320,001 to 325,000 321,514
1 325,001 to 330,000 327,000
1 380,001 to 385,000 383,750
2 405,001 to 410,000 816,126
1 430,001 to 435,000 433,907
1 450,001 to 455,000 450,060
1 550,001 to 555,000 552,685
1 595,001 to 600,000 600,000
1 880,001 to 885,000 882,850
1 1,275,001 to 1,280,000 1,276,010
1 4,890,000 to 4,890,000 4,890,000
1 9,820,001 to 9,825,000 9,825,000
1 19,645,001 to 19,650,000 19,650,000
1 27,382,730 to 27,382,730 27,382,730
3,983 78,600,000

As at June 30, 2018
CATEGORY
NUMBER WISE NO. CATEGORY
NO. CATEGORIES OF SHAREHOLDERS OF SHARES OF FOLIOS WISE SHARES PERCENTAGE
HELD / CDC HELD
ACCOUNTS
1 DIRECTORS ,CHIEF EXECUTIVE OFFICER AND

THEIR SPOUSE AND MINOR CHILDREN 7 306,662 0.39
MR. ALI S. HABIB 135,000
MR. MOHAMEDALI R. HABIB 130,000
MR. FARHAD ZULFICAR 2,000
MR. PARVEZ GHIAS 561
MR. AZAM FARUQUE 500
MR. ALI ASGHAR JAMALI 38,000
MRS. MUNIZEH ALI HABIB 601
2 ASSOCIATED COMPANIES, UNDERTAKINGS AND
RELATED PARTIES 3 4,938,015 6.28
HABIB INSURANCE COMPANY LIMITED 43,015
THAL LIMITED 4,890,000
MOHAMEDALI HABIB WELFARE TRUST 5,000
3 EXECUTIVES 6 4,174 0.01
4 PUBLIC SECTOR COMPANIES AND CORPORATIONS 4 561,873 0.71
5 BANKS, DFIs, NBFIs, INSURANCE COMPANIES, TAKAFUL,
MODARABAS & PENSION FUNDS 23 657,626 0.84
6 MUTUAL FUNDS 31 925,683 1.18
CDC - TRUSTEE ATLAS STOCK MARKET FUND 19,000
CDC - TRUSTEE ALFALAH GHP VALUE FUND 5,960
CDC - TRUSTEE AKD INDEX TRACKER FUND 2,969
CDC - TRUSTEE NAFA STOCK FUND 74,890
CDC - TRUSTEE NAFA MULTI ASSET FUND 6,820
CDC - TRUSTEE NAFA ISLAMIC ASSET ALLOCATION FUND 22,040
CDC - TRUSTEE NIT-EQUITY MARKET OPPORTUNITY FUND 46,840
CDC - TRUSTEE LAKSON EQUITY FUND 18,629
CDC - TRUSTEE NAFA ASSET ALLOCATION FUND 8,950
CDC - TRUSTEE NATIONAL INVESTMENT (UNIT) TRUST 409,386
CDC - TRUSTEE NAFA ISLAMIC STOCK FUND 16,610
CDC - TRUSTEE PIML VALUE EQUITY FUND 4,000
CDC - TRUSTEE NIT ISLAMIC EQUITY FUND 117,130
CDC - TRUSTEE NAFA ISLAMIC ACTIVE ALLOCATION EQUITY FUND 3,290
CDC - TRUSTEE LAKSON TACTICAL FUND 4,010
CDC - TRUSTEE MCB PAKISTAN STOCK MARKET FUND 10
CDC - TRUSTEE PAKISTAN CAPITAL MARKET FUND 50
CDC - TRUSTEE PICIC INVESTMENT FUND 26,680
CDC - TRUSTEE PICIC GROWTH FUND 47,120
CDC - TRUSTEE FAYSAL STOCK FUND 3,000
CDC - TRUSTEE FAYSAL ASSET ALLOCATION FUND 2,000
CDC - TRUSTEE APF-EQUITY SUB FUND 1,500
CDC - TRUSTEE HBL - STOCK FUND 55,160
CDC - TRUSTEE HBL MULTI - ASSET FUND 1,640
CDC - TRUSTEE ALFALAH GHP STOCK FUND 9,080
CDC - TRUSTEE ALFALAH GHP ALPHA FUND 6,540
CDC - TRUSTEE PIML ASSET ALLOCATION FUND 6,600
CDC - TRUSTEE LAKSON ISLAMIC TACTICAL FUND 739
CDC - TRUSTEE HBL PF EQUITY SUB FUND 1,400
CDC - TRUSTEE HBL EQUITY FUND 2,140
CDC - TRUSTEE FIRST CAPITAL MUTUAL FUND 1,500
152
As at June 30, 2018
7 FOREIGN INVESTORS / COMPANIES 87 62,819,800 79.92

Holding 5% or more voting interest
OVERSEAS PAKISTAN INVESTORS AG 27,382,730
TOYOTA MOTOR CORPORATION 19,650,000
TOYOTA TSUSHO CORPORATION 9,825,000
8 GENERAL PUBLIC 5,145,226 6.55
Local 3,261
Foreign 457
9 OTHERS 104 3,240,941 4.12
TOTAL 3,983 78,600,000 100.00

Ten Year Performance Indicators
Financial Summary 2018 2017 2016 2015
Income Statement
Net revenue Rs in '000 140,207,524 112,271,656 108,758,668 96,516,322
Gross profit Rs in '000 24,376,753 19,821,701 17,731,299 14,244,230
Profit before taxation Rs in '000 22,999,166 19,140,767 17,397,446 14,132,569
Profit after taxation Rs in '000 15,771,860 13,001,265 11,454,940 9,110,251
Dividends Rs in '000 11,004,000 9,039,000 7,860,000 6,288,000
Statement of Financial Position

Share capital Rs in '000 786,000 786,000 786,000 786,000
Reserves Rs in '000 35,958,342 30,410,962 26,843,609 23,249,520
Fixed Assets Rs in '000 7,311,379 6,345,444 4,938,277 5,193,477
Net current assets Rs in '000 29,383,117 24,762,671 17,473,164 13,861,221
Long term liabilities Rs in '000 22,711 3,933 - -
Investor Information
Gross profit ratio % age 17.39 17.66 16.30 14.76
Net profit ratio % age 11.25 11.58 10.53 9.44
Earning per share Rs 200.66 165.41 145.74 115.91
Inventory turnover Times 11 11 13 15
Debt collection period Days 3 3 3 4
Average fixed assets turnover Times 22.89 19.90 21.47 17.19
Breakup value per share Rs 467.49 396.91 351.52 305.80
Market price per share
- as on June 30 Rs 1,421.46 1,793.60 939.54 1,249.00
- High value during the period Rs 1,980.00 2,110.00 1,313.00 1,320.00
- Low value during the period Rs 1,300.00 935.00 884.75 520.00
Price earning ratio Times 7.08 10.84 6.45 10.78
Dividend per share Rs 140.00 115.00 100.00 80.00
Dividend yield % age 9.85 6.41 10.64 6.41
Dividend payout % age 69.77 69.52 68.62 69.02
Dividend cover Times 1.43 1.44 1.46 1.45
Return on equity % age 42.92 41.67 41.46 37.90
Debt to equity Ratio 0:1 0:1 0:1 0:1
Current ratio Ratio 1.63:1 1.76:1 1.58 : 1 1.53 : 1
Other Information
Units sold Nos. 64,000 60,586 64,584 57,387
Units Produced Nos. 62,886 59,945 64,096 56,888
Manpower Nos. 3,266 2,849 2,765 2,322
Contribution to National Exchequer Rs in '000 48,843,141 38,959,490 37,325,754 32,076,453
154
2014 2013 2012 2011 2010 2009
57,063,622 63,829,075 76,962,642 61,702,677 60,093,139 37,864,604

5,793,582 5,857,037 6,561,854 4,089,135 4,856,514 2,324,186
5,016,497 4,969,775 6,312,267 4,011,455 5,242,539 2,046,013
3,873,452 3,357,545 4,302,715 2,743,384 3,443,403 1,385,102
2,318,700 1,965,000 2,515,200 1,179,000 1,179,000 786,000
786,000 786,000 786,000 786,000 786,000 786,000

19,129,652 16,907,291 16,227,858 13,333,648 11,801,615 9,510,973
6,033,264 2,742,140 3,472,906 4,225,710 3,324,333 3,934,473
14,062,278 14,775,801 13,693,056 10,326,779 9,566,387 6,830,469
- - - - - -
10.15 9.18 8.53 6.63 8.08 6.14

6.79 5.26 5.59 4.45 5.73 3.66
49.28 42.72 54.74 34.90 43.81 17.62
8 8 11 11 12 11
10 8 7 9 10 14
13.01 18.32 19.99 16.34 16.56 9.50
253.38 225.11 216.46 179.64 160.15 131.00
537.92 311.00 245.08 220.00 262.38 107.72

549.00 364.60 305.00 309.73 278.00 198.05
300.00 237.00 187.00 205.51 107.10 50.40
10.92 7.28 4.48 6.30 5.99 6.11
29.50 25.00 32.00 15.00 15.00 10.00
5.48 8.04 13.06 6.82 5.72 9.28
59.86 58.52 58.46 42.98 34.24 56.75
1.67 1.71 1.71 2.33 2.92 1.76
19.45 18.98 25.29 19.43 27.36 13.45
0:1 0:1 0:1 0:1 0:1 0:1
3.35 : 1 2.99 : 1 2.32 : 1 1.84 : 1 1.67 : 1 1.69 : 1
34,470 38,517 55,060 50,943 52,063 35,276

33,012 37,405 54,917 50,759 50,557 34,298
2,091 2,225 2,292 2,187 1,948 1,893
19,261,559 21,267,303 24,725,706 22,043,581 20,332,421 14,143,597

Notice of Annual General Meeting
Notice is hereby given that the Twenty Ninth Annual General Meeting of INDUS MOTOR COMPANY LIMITED
will be held on Tuesday, October 16, 2018 at 9:00 a.m. at the Institute of Chartered Accountants of Pakistan
situated at Chartered Accountants Avenue, Clifton, Karachi, to transact the following business:
ORDINARY BUSINESS
1. To receive, consider and adopt the Annual Audited Financial statements of the Company for the year
ended June 30, 2018, together with the Report of the Directors and Auditors thereon.
2. To approve cash dividend (2017-2018) on the ordinary shares of the Company. The directors have
recommended a Final Cash dividend at 450% i.e. Rs 45 per share. This is in addition to the combined
Interim Dividend of 950% i.e. Rs. 95 per share already paid. The total dividend for 2017-2018 will thus
amount to 1400% i.e. Rs. 140 per share.
3. To appoint auditors and fix their remuneration for the year ending June 30, 2019. The present auditors
M/s. A.F. Ferguson & Co., Chartered Accountants, retire and being eligible have offered themselves for
re-appointment.
4. To present any other business with the permission of the Chairman.
By order of the Board
Karachi. Muhammad Arif Anzer

August 28, 2018 Company Secretary
NOTES:
1. Closure of Share Transfer Books

The Share Transfer Books of the Company will be closed from October 9, 2018 to October 16, 2018
(both days inclusive) for the purpose of the Annual General Meeting and payment of the final dividend.
Transfer requests received by the Company’s Share Registrar, “M/s. Central Depository Company of
Pakistan Limited, CDC House, 99-B, Block “B”, S.M.C.H.S., Main Shahrah-e-Faisal, Karachi-74400.
Tel: 0800-23275, UAN: 111-111-500, Email: [email protected] at the close of business on October
8, 2018, will be treated in time for the purpose of determining above entitlement to the transferees for
payment of final dividend and to attend the Annual General Meeting.
2. Proxy
A member entitled to attend and vote at this General Meeting is entitled to appoint a Proxy to attend,
speak and vote in his place at the Meeting. Instrument appointing a proxy must be deposited at the
Registered Office of the Company at least forty eight hours before the time of the meeting.
To facilitate identification for right to attend the Annual General Meeting, Shareholder whose holdings
are on the Central Depository System (CDS) or his Proxy should authenticate his identity by showing
his original CNIC or original Passport at the time of attending the meeting; along with the Participant’s
Identity Number and Shareholder’s account number allocated by the Central Depository Company.
In case of corporate entity, the Board of Directors’ resolution / power of attorney with specimen
signature of the nominee shall be produced at the time of the meeting.
3. Change of Address
The Shareholders are requested to promptly notify change in their address, if any, to the Company’s
Share Registrar.
4. Submission of copies of CNIC not provided earlier

Individual Shareholders are once again reminded to submit a copy of their valid CNIC, if not provided
earlier to the Company’s Share Registrar, Central Depository Company of Pakistan Limited. In case of
156
non-availability of a valid copy of the Shareholders’ CNIC in the records of the Company, the company
shall withhold the Dividend under the provisions of Section 243 of the Companies Act, 2017.
5. Withholding Tax on Dividend

Currently, the deduction of withholding tax on the amount of dividend paid by the companies under
section 150 of the Income Tax Ordinance, 2001, are as under:
(a) For filers of income tax returns: 15%

(b) For non-filers of income tax returns: 20%
Shareholders who are filers are advised to make sure that their names are entered into latest Active Tax
Payers List (ATL) provided on the website of FBR at the time of dividend payment, otherwise they shall be
treated as non-filers and tax on their cash dividend will be deducted at the rate of 20% instead of 15%.
6. Withholding tax on Dividend in case of Joint Account Holders

In order to enable the Company to follow the directives of the regulators to determine shareholding
ratio of the Joint Account Holder(s) (where shareholding has not been determined by the Principal
shareholder) for deduction of withholding tax on dividend of the Company, shareholders are requested
to please furnish the shareholding ratio details of themselves as Principal shareholder and their Joint
Holders , to the Company’s Share Registrar, enabling the Company to compute withholding tax of
each shareholder accordingly. The required information must reach the Company’s Share Registrar by
October 8, 2018, otherwise each shareholder will be assumed to have equal proportion of shares and
the tax will be deducted accordingly.
7. Payment of Cash Dividend Electronically (Mandatory)

In accordance with the provisions of section 242 of the Companies Act, 2017 and Companies
(Distribution of Dividend) Regulations, 2017, it is mandatory that dividend payable in cash shall only be
paid through electronic mode directly into the bank account designated by the entitled shareholder.
Notice in this regard have already been published earlier in newspapers as per Regulations. All
shareholders are once again requested to provide details of their bank mandate specifying: (i) title of
account, (ii) account number, (iii) IBAN number (iv) bank name and (v) branch name, code & address
and (vi) Mobile number to Company’s Share Registrar M/s. Central Depository Company of Pakistan
Limited. Shareholders who hold shares with Participants / Central Depository Company of Pakistan
(CDC) are advised to provide the mandate to the concerned Broker / CDC. Shareholders may use the
electronic dividend mandate form attached to this report or form available on the Company’s website
to provide their details.
8. Distribution of Annual Report through Email (Optional)

Pursuant to the provision of section 223(6) of the Companies Act, 2017, the companies are permitted
to circulate their annual financial statements, along with auditor’s report, directors’ review report etc.
(“Annual Report”) and the notice of annual general meeting (“Notice”), to its shareholders by email.
Shareholders of the Company who wish to receive the Company’s Annual Report and Notices of
annual general meeting by email are requested to provide the completed Electronic Communication
Consent Form (available on the Company’s website), to the Company’s Share Registrar, Central
Depository Company of Pakistan Limited.
9. Consent for the Facility of video-link

Pursuant to the provisions of the Companies Act 2017, the company may on the demand of members
at least 7 days before the general meeting, residing in a city, who hold at least 10% of the total paid
up capital of the Company, provide the facility of video- link (Optional) to such members enabling them
to participate in its annual general meeting. If you wish to take benefit of this facility, please fill the form
available on the Company’s Website and submit it to the Company at its registered address at least
10 days prior to the date of the meeting.
The Company will intimate members the venue of the video conference facility, if required criteria
have been fulfilled, at least 7 days before the date of general meeting along with complete information
necessary to enable them to access such facility.

158

160

162

164

166

168

170

172

174

176

178

180

182
Form of Proxy
Twenty Ninth Annual General Meeting
I/We,___________________________________________________________________________________
of _______________________________________________________________________________________
being a member(s) of INDUS MOTOR COMPANY LIMITED, holder of ______________________________
ordinary shares, as per Folio No. / CDC Participant ID & A/c No. ______________ hereby appoint Mr./Mrs./
Ms.______________________________________________________________Folio No. / CDC Participant
ID & A/c No. __________________ of _______________________________________, as my /our proxy in
my/ our absence to attend and vote for me/ us and on my/our behalf at the Twenty Ninth Annual General
Meeting of the Company to be held on October 16, 2018 and / or any adjournment thereof.
Signed under my / our hand this _____________ day of _________ 2018
Affix revenue
stamp of
Rs 5/-
Signature
(Sign should agree with specimen
Signed in the presence of: registered with the Company)
Witness 1 Witness 2
Signature ______________________________________ Signature ______________________________________
Name ___________________________________________ Name ___________________________________________
CNIC / Passport No. _____________________________ CNIC / Passport No. ____________________________
Address _________________________________________ Address _________________________________________
NOTES
1. This proxy form duly completed and signed, must be received at the office of the Company’s Share
Registrar of the Company, not less than 48 hours before the time of holding the meeting.
2. No person shall act as proxy unless he/she himself/herself is a member of the Company, except
that a corporation may appoint a person who is not a member.
3. If a member appoints more than one proxy and more than one instrument of proxy are deposited
by a member with the Company, all such instruments of proxy shall be rendered invalid.
For CDC Account Holders/ Corporate Entities:
In addition to the above the following requirements have to be met:
iv. The proxy form shall be witnessed by two persons whose names, addresses and CNIC numbers
shall be mentioned on the form.
v. Attested copies of CNIC or the passport of the beneficial owners and the proxy shall be furnished
with the proxy form.
vi. The proxy shall produce his original CNIC or original passport at the time of meeting.
vii. In case of corporate entity, the Board of Directors’ resolution / power of attorney with specimen
signature shall be submitted (unless it has been provided earlier) alongwith proxy form to the
Company
AFFIX
CORRECT
POSTAGE
Registrar, Indus Motor Company Limited
M/s. Central Depository Company of Pakistan
Limited, CDC House, 99-B, Block “B”, S.M.C.H.S.,
Main Shahrah-e-Faisal, Karachi-74400.
AFFIX
CORRECT
POSTAGE
Size= 6.4764” X 9.7441”

Electronic Dividend Mandate Form
Indus Motor Company Limited
In accordance with the provisions of section 242 of the Companies Act, 2017 and Companies (Distribution
of Dividend) Regulations, 2017, it is mandatory that dividend payable in cash shall only be paid through
electronic mode directly into the bank account designated by the entitled shareholder.
Shareholders are requested to send the attached Form duly filled and signed, alongwith attested copy of
their CNIC to the Company’s Share Registrar M/s. Central Depository Company of Pakistan Limited (CDC),
CDC House, 99-B, Block-B, SMCHS, Main Shahrah-e-Faisal, Karachi. Shareholders who hold shares with
Participants / CDC are advised to provide the Dividend Mandate and attested copy of CNIC, directly to
their concerned Broker (Participants) / CDC.
------------------------------------------------------------------------------------------------------------------------
My Bank account details for credit of dividend are as below:
Name of shareholder :--------------------------------------------------------------------------
Folio Number/CDC Account No. : ----------------------------of Indus Motor Company Limited.
Mobile number of shareholder : --------------------------------------------------------------------------
Title of Account (*) : --------------------------------------------------------------------------
Account Number: : --------------------------------------------------------------------------
IBAN Number (**) : --------------------------------------------------------------------------
Name of Bank : --------------------------------------------------------------------------
Bank branch & Code : --------------------------------------------------------------------------
Mailing Address of Branch : --------------------------------------------------------------------------
CNIC No. (attach attested copy) : --------------------------------------------------------------------------
NTN (in case of corporate entity) : --------------------------------------------------------------------------
It is stated that the above particulars given by me are correct and to the best of my knowledge; I shall keep
the Company informed in case of any changes in the said particulars in future.
Shareholder’s Signature Date
NOTES:
* Joint account holders shall specify complete Title of Account, including shareholders name.
** Please provide complete IBAN Number, after checking with your concerned Bank branch to enable
electronic credit directly into your bank account.

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2018

Statement of Compliance with the

Action, Commitment and Teamwork to

Respect & Corporate Image

Production & Sales

Quality & Safety

Annual Report 2018 9

Annual Report 2018 11

Toyota Motor Corporation

Annual Report 2018 15

• Following our “Customer • Fostering a Kaizen culture • Maximizing QRD (Quality,

Respecting our people Become a Good Corporate Citizen

• Treating employees as the most • Following ethical business practices

Annual Report 2018 17

He is a graduate in Mechanical Engineering from the University of

He has completed his Bachelor’s degree in Sociology from Hitotsubashi

Ali Asghar Jamali

He is a fellow of the Institute of Chartered Accountants of Pakistan and has

He is a fellow of the Institute of Chartered Accountants from England &

He is an Electrical Engineering and Computer Science graduate from Princeton

Annual Report 2018 19

He is a commerce graduate from the University of Karachi.

He has a graduate degree in Business Management – Finance from Clark

He is a graduate from Faculty of Law of Kagawa University, Japan.

He is a graduate from the Miyazaki University, Japan.

He graduated from Kobe University, Japan.

Annual Report 2018 21

As part of its diversification strategy, Loads

Vendor: TechnoPak Industries (Pvt.) Ltd.

Tecno Group feels optimistic about future growth in

Annual Report 2018 27

Procon is IATF 16949:2016, ISO 9001:2015 and ISO 14001:2004 certified

The relationship between Procon and IMC

Vendor: Rubatech Manufacturing Company (Pvt.) Ltd.

RMC is also a specialist in high performance

RMC’s plans to enhance its manufacturing

The automotive industry is heavily dependent

Annual Report 2018 29

An Engineering Plastics, Custom OEM processor

Over the last thirty four years the company took

For the last 25 years, Thermosole is part of IMC vendor

Vendor: PCI Automotive (Pvt.) Ltd.

We take pride in the fact that PCI

Annual Report 2018 31

Today Razi Sons (Pvt.) Ltd has become synonymous with

Since the inception, Razi Sons is a part of IMC’s supplier

Vendor: Omar Jibran Engineering Industries Ltd.

OJ is the first vendor in Pakistan to introduce

Over the past 30 years, is among few

Annual Report 2018 33

It’s like a family being a part of the IMC supplier network.

Vendor: Synthetic Products Enterprises Ltd.

SPEL values Customer Satisfaction, Save Environment, Respect for everyone in

SPEL works hand in hand with IMC

Annual Report 2018 35

We wish to bring in new technology to enhance the quality production

Vendor: Baluchistan Wheel Ltd.

This facility provides a diverse range of wheels for passenger cars,

The Company is a corresponding member of European Tyre and