PHILIPS ELECTRONICS INDIA LIMITED

Sales Rs. in Mln Sales by activities - 2007

Others
DAP
1%
6%

32000 Medical
systems
28389 28906 12% Lighting
26486 44%

24000 23637
Software
development
8%
16367
16000

8000

Cons. Elec.
29%
0
2003 2004 2005 2006 2007

Profit Before Tax Rs. in Mln Net Worth Rs. in Min

4000 10000
9412
9000
3500
3029 8000 7677
3000 2894
7000
2500 6000 5708
5029
2000 5000

1492 4000 3624

1500
1050 983
3000
1000
2000
500 1000

0 0
2003 2004 2005 2006 2007 Dec-03 Dec-04 Dec-05 Dec-06 Dec-07

Share Capital Reserves

Fixed Assets Rs. in Mln Current Assets Rs. in Mln

8000 7572 16000

7206
7007 6904
7000 13552
6456

6000 12000 11166

5000 4735
4335 4346 4210 8660
8424
4000 3806 8000

3000
5050

2000 4000

1000

0 0
Dec-03 Dec-04 Dec-05 Dec-06 Dec-07 Dec 03 Dec 04 Dec 05 Dec 06 Dec 07

Accumulated Depreciation Gross Fixed Assets Inventories Debtors, loans & advances
and Cash/Bank Balances
 PHILIPS ELECTRONICS INDIA LIMITED

CONTENTS

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Board of Directors 2

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Notice of Annual General Meeting 3

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Directors’ Report 11

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Annexure to Directors’ Report 17

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Auditors’ Report 22

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Annexure to Auditors’ Report ○
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23

Profit and Loss Account for the Year 26

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ended December 31, 2007

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Balance Sheet as at December 31, 2007 27

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Statement of Accounting Policies 28

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Notes to Profit and Loss Account 30

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& Balance Sheet

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Cash Flow for the year ended 51

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December 31, 2007

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Ten-Year Review 52
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Annual General Meeting on Friday, June 13, 2008 at 2.30 p.m.

at Vidya Mandir, 1 Moira Street, Kolkata - 700 017.
You are requested to kindly carry your copy of the Annual Report to the Meeting.

Annual
Report 2007 1
 PHILIPS ELECTRONICS INDIA LIMITED

Board of Directors

Chairman
S.M. Datta

Vice-Chairman & Managing Director

Murali Sivaraman

Executive Directors
Cornelis J. M. Reuvers
S. Venkataramani
Alexius Collette
Vineet Kaul

Company Secretary
R. J. Wani

Auditors
BSR & Co.
Chartered Accountants

Bankers
Punjab National Bank
Corporation Bank
Citibank N.A.
ABN-AMRO Bank N. V.
Standard Chartered Bank
Bank of America N.A.

Registered Office
7, Justice Chandra Madhab Road, Kolkata - 700 020

2
NOTICE OF ANNUAL GENERAL MEETING
NOTICE is hereby given that the Seventy Eighth Annual General Meeting of PHILIPS ELECTRONICS INDIA
LIMITED will be held at Vidya Mandir, 1 Moira Street, Kolkata – 700 017, on Friday, June 13, 2008 at 2.30 p.m.
to transact the following business:
ORDINARY BUSINESS:
1. To receive, consider and adopt the Balance Sheet as at December 31, 2007, and the Profit and Loss Account
for the year ended on that date and the Reports of the Directors’ and Auditors’ thereon.
2. To declare a dividend for the year ended December 31, 2007.
3. To appoint Directors in place of those retiring by rotation.
4. To appoint Statutory Auditors of the Company and to fix their remuneration.
SPECIAL BUSINESS:
5. To consider and if thought fit, to pass, with or without modification, the following resolution as an Ordinary Resolution:
“RESOLVED that in accordance with the provisions of Section 257 and all other applicable provisions, if any, of
the Companies Act, 1956 or any statutory modification(s) or re-enactment thereof, Mr. Murali Sivaraman, be
and is hereby appointed as a Director of the Company not liable to retire by rotation, under the provision of
Article 109 of Articles of Association of the Company.”
6. To consider and if thought fit, to pass, with or without modification, the following resolution as a Special Resolution:
“RESOLVED that, pursuant to the provisions of Sections 198, 269 and 309 read with Schedule XIII and all
other applicable provisions, if any, of the Companies Act, 1956, or any statutory modification(s) or re-
enactment thereof, and subject to the approval of the Central Government, consent of the Company be and
is hereby accorded to the remuneration and perquisites being paid or granted to Mr. Murali Sivaraman as a
Whole time Director, with effect from July 2, 2007 for a period of five years or up to the date of his retirement
as per the rules of the Company whichever is earlier, as set out in the draft Agreement to be entered into
between the Company and Mr. Sivaraman, a copy whereof initialed by the Secretary for the purpose of
identification has been placed before this meeting, which Agreement is hereby specifically approved with the
liberty to the Board of Directors (hereinafter referred to as “the Board” which term shall be deemed to include
any Committee of the Board constituted to exercise its powers, including the power conferred by this
Resolution) to increase, reduce, alter or vary the terms of remuneration and perquisites including monetary
value thereof as set out in the Agreement, at any time(s) and from time to time and in such manner as the
Board may deem fit;
RESOLVED FURTHER that in the event of loss or inadequacy of profits in any financial year of the Company
during the term of Mr. Sivaraman’s office as a Wholetime Director, the remuneration and perquisites set out in
the aforesaid Agreement be paid or granted to Mr. Sivaraman as minimum remuneration, provided that the
total remuneration by way of salary, perquisites and any other allowances shall not, unless approved by the
Central Government, exceed the ceiling as provided in Section II of Part II of Schedule XIII to the said Act or
any equivalent statutory re-enactment(s) thereof;
RESOLVED FURTHER that the Board be and is hereby authorized to take all such steps as may be necessary,
proper or expedient to give effect to this Resolution.”
7. To consider and if thought fit, to pass, with or without modification, the following resolution as a Special Resolution:
“RESOLVED that, pursuant to the provisions of Section 198, 269, 309 read with Schedule XIII and all other
applicable provisions, if any, of the Companies Act, 1956 or any statutory modification(s) or re-enactment
thereof, consent of the Company be and is hereby accorded to the re-appointment of and the remuneration
and perquisites being paid or granted to Mr. Vineet Kaul as a Wholetime Director of the Company for a period
of five years with effect from January 30, 2008 or up to the date of his retirement as per rules of the Company,
whichever is earlier, on the terms and conditions as set out in the draft Agreement to be entered into between

Annual
Report 2007 3
 PHILIPS ELECTRONICS INDIA LIMITED

the Company and Mr. Kaul, a copy whereof initialed by the Secretary for the purpose of identification has been
placed before this meeting, which Agreement is hereby specifically approved with the liberty to the Board of
Directors (hereinafter referred to as “the Board” which term shall be deemed to include any Committee of the
Board constituted to exercise its powers, including the power conferred by this Resolution) to increase, reduce,
alter or vary the terms of remuneration and perquisites including monetary value thereof as set out in the
Agreement, at any time(s) and from time to time and in such manner as the Board may deem fit;
RESOLVED FURTHER that in the event of loss or inadequacy of profits in any financial year of the Company
during the term of Mr. Kaul’s office as a Wholetime Director, the remuneration and perquisites set out in the
aforesaid Agreement be paid or granted to Mr. Kaul as minimum remuneration, provided that the total
remuneration by way of salary, perquisites and any other allowances shall not, unless approved by the Central
Government, exceed the ceiling as provided in Section II of Part II of Schedule XIII to the said Act or any
equivalent statutory re-enactment(s) thereof;
RESOLVED FURTHER that the Board be and is hereby authorized to take all such steps as may be necessary,
proper or expedient to give effect to this Resolution.”

8. To consider and if thought fit, to pass, with or without modification, the following resolution as a Special Resolution:
RESOLVED that pursuant to the provisions of Article 12A of the Articles of Association of the Company and
in accordance with the provisions of Sections 77A and 77B and all other applicable provisions, if any of the
Companies Act, 1956 (hereinafter referred to as “the Act”) and the provisions contained in the Private Limited
Company and Unlisted Public Limited Company (Buy-back of Securities) Rules, 1999 as amended upto date
(hereinafter referred to as “the Buy-back Regulations”) including any statutory modification(s) or re-enactment
of the said Act or the Buy-back Regulations framed thereunder from time to time and subject to such
approvals, permissions and sanctions as may be necessary and further subject to such conditions and modifications
as may be prescribed or imposed while granting such approvals, permissions and sanctions which may be
agreed to by the Board of Directors of the Company (hereinafter referred to as “the Board” which expression
shall be deemed to include a Committee thereof) the consent of the Company be and is hereby accorded to
the Board to purchase or Buy-back its fully paid-up equity shares of the face value of Rs 10/- each up to a
maximum of 6,923,076 equity shares and cash outflow not exceeding Rs 1800 million (Rs. One thousand eight
hundred million only) at a price not exceeding Rs 260/- (Rs. Two hundred sixty only) per equity share
(hereinafter referred to as “the Buy-back”);
RESOLVED FURTHER that the Board be and is hereby authorized to implement the Buy-back within a period
of twelve months from the date of passing of this Resolution (or such extended period as may be permitted
under the Act or Buy-back Regulations or by the appropriate authorities) in one or more tranches from out of
the Company’s Free Reserves and/or Securities Premium Account and or the proceeds of earlier issue of
shares other than equity shares made specifically for Buy-back purposes, by adapting the methodology involving
purchase of the Equity from the existing equity shareholders on a proportionate basis, in such manner as may
be prescribed by the Act and/or the Buy-back Regulations and on such terms and conditions as the Board may
from time to time in its absolute discretion deem fit;
RESOLVED FURTHER that within the limits of maximum 6,923,076 equity shares and cash outflow not
exceeding Rs 1800 million (Rs. One thousand eight hundred million only) at a price not exceeding Rs 260/-
(Rs. Two hundred sixty only) per equity share stipulated as aforesaid, the Board be and is hereby authorized to
determine the aggregate amount to be utilized towards the Buy-back including the number of equity shares to
be bought back, the specific price for individual transactions in the Buy-back and the time frame for the
completion of the modalities for the closure of the Buy-back;
RESOLVED FURTHER that subject to applicable statutory regulations and within the overall limits of a
maximum of 6,923,076 equity shares and cash outflow not exceeding Rs 1800 million (Rs. One thousand eight
hundred million only) at a price not exceeding Rs 260/- (Rs. Two hundred sixty only) per equity share, the
Board be and is hereby authorized to implement Buy-back through one or more of the other permitted
methodologies including tender route, within a period of twelve months (or such permitted extended period)

4
 from the date of passing of this resolution and the Board may decide to close the Buy-back through the
methodology of purchase of the Equity Shares from the existing equity shareholders on a proportionate basis;
RESOLVED FURTHER that nothing contained hereinabove shall confer any right on the part of any shareholder
to offer and/or any obligation on the part of the Company or the Board to Buy-back any shares, and/or impair
any power of the Company or the Board to terminate any process in relation to such Buy-back, if so
permissible by law;
RESOLVED FURTHER that the buy-back of shares from non-resident shareholder, and/or shareholders of
foreign nationality shall be subject to such further approvals as may be required including approvals, if any, from
the Reserve Bank of India under the Foreign Exchange Management Act, 1999 and the Rules/Regulations
framed thereunder;
RESOLVED FURTHER that the Board be and is hereby authorized to delegate all or any of its powers to any
committee of Directors of the Company for giving effect to the aforesaid Resolutions.”

By Order of the Board

R J Wani
Company Secretary
New Delhi, March 11, 2008

NOTES:
1. A MEMBER ENTITLED TO ATTEND AND VOTE AT THE MEETING IS ENTITLED TO APPOINT ONE OR
MORE PROXIES TO ATTEND AND VOTE INSTEAD OF HIMSELF ONLY ON POLL AND THE PROXY
NEED NOT BE A MEMBER. PROXIES IN ORDER TO BE EFFECTIVE MUST BE RECEIVED BY THE
COMPANY AT ITS REGISTERED OFFICE NOT LESS THAN 48 HOURS BEFORE THE TIME OF HOLDING
THE MEETING.
2. The relevant Explanatory Statement pursuant in Section 173 of the Companies Act, 1956 in respect of the
Special Business at item nos. 5 to 8 of the Notice, is annexed hereto.
3. The Share Transfer Books and the Register of Members of the Company will remain closed from June 2, 2008
to June 12, 2008 (both days inclusive).
4. The dividend if approved, will be paid on or after June 22, 2008 to those members (or their mandatories)
whose names appear in the Company’s Register of Members on June 12, 2008. In respect of demat shares the
dividend will be payable on the basis of beneficial ownership as per the details furnished by the Depositories for
this purpose.
5. Members are requested to contact the Registrar and Share Transfer Agent for all matters connected with
Company’s shares at :
Sharepro Services Sharepro Services
Above Bank of Baroda Free Press Journal Road
Caridnal Gracious Road, Chakala Nariman Point
Andheri (East) Mumbai – 400 099 Mumbai – 400 021
Tel: (022) 67720300 / 67720351 Tel: (022) 67720700
Fax: (022) 28375646 Fax:(022) 22825484
6. Members holding shares in physical form are requested to notify/send the following to the Company’s Registrar
and Share Transfer Agent to facilitate better service:
i) any change in their address/mandate/bank details
ii) share certificate(s) held in multiple accounts names or joint accounts in the same order of names for
consolidation of such shareholdings into one account.

Annual
Report 2007 5
 PHILIPS ELECTRONICS INDIA LIMITED

EXPLANATORY STATEMENT
Under Section 173 of the Companies Act, 1956
Item No. 5 & 6
Mr. Murali Sivaraman was appointed as an Additional Director and a Wholetime Director of the Company with
effect from July 2, 2007, at the meeting of the Board of Directors of the Company (“the Board”) held on April 19,
2007. At the said meeting the Board appointed Mr. Sivaraman as Managing Director of the Company to be effective
from October 3, 2007 following the retirement of Mr. K Ramachandran, the Vice-Chairman and Managing Director
of the Company with effect from the same date. The Board at their meeting held on November 2, 2007 re-
designated Mr. Sivaraman as Vice-Chairman and Managing Director of the Company. According to the provisions of
Section 260 of the Companies Act, 1956 (‘the Act’), read with Article 110 of the Articles of Association of the
Company, Mr. Sivaraman holds office as an Additional Director up to the date of this Annual General Meeting. The
Company has received due notice from a member under Section 257 of the Act signifying his intention to propose
the appointment of Mr. Sivaraman as Director of the Company.
Mr. Sivaraman is a Cost and Works Accountant, a Chartered Accountant, and holds a post graduate degree in
Business Management from the Indian Institute of Management, Ahmedabad. He has completed the advanced
management program from Harvard Business School in 2004. Mr. Sivaraman joined ICI in India in 1987, and his early
career was in various assignments in accounting and finance before becoming the Financial Controller for the Paints
business in India. He was appointed Managing Director of ICI Paints (Singapore) Pte Limited in 1996, and over the
last ten years has held a number of senior management positions in ICI’s global operations, like General Manager, ICI
Swire Paints (China) Limited; Managing Director, ICI Swire Paints, PRC and Hong Kong; and President, ICI Canada
Inc. Before joining Philips, Mr. Sivaraman was Process Director for ICI ERP Project based in London in UK.
Mr. Sivaraman brings with him twenty years of rich and varied global business experience. His experience includes
managing profitable growth and multiple brands in B2C and B2B businesses. Your Board is confident that Mr.
Sivaraman appointment as Vice Chairman and Managing Director of the Company will bring the very necessary
breadth and depth required to lead the Company’s growth phase in the coming years. Your Board therefore
recommends Mr. Sivaraman’s appointment as a Whole time Director for a period of five years with effect from July
2, 2007 and as Vice Chairman and Managing Director with effect from October 3, 2007.
The Central Government has approved the appointment of Mr. Sivaraman, as a Wholetime Director of the
Company w.e.f July 2, 2007 which is valid till the ensuing Annual General Meeting, and will be further extended
subject to the approval of Shareholders in the said meeting.
The remuneration and perquisites of Mr. Sivaraman are set out in the draft Agreement referred to in the resolution
at Item No. 6 of the Notice and are subject to the approval of the shareholders of the Company under Sections
269 and 309 of the Companies Act, 1956 (‘Act’) read with Schedule XIII thereto.
The terms of the said Agreement are as follows:
1. The Agreement is for a period of five years from the date of appointment i.e. from July 2, 2007 up to July 1, 2012.
2. Mr. Sivaraman shall be entitled to the following remuneration and benefits/perquisites from the Company
provided that the Board of Directors (hereinafter referred to as “the Board” which term shall be deemed to
include any Committee of the Board constituted to exercise its powers, including the power conferred by this
Resolution), is authorised to increase, reduce, alter or vary the remuneration and perquisites as such time(s)
and in such manner as the Board, may deem fit:
a. Consolidated Salary : Rs. 9,16,667/- per month or such higher amount as may be approved by the Board
of Directors or any Committee thereof.
b. Variable Performance Linked Bonus: Not exceeding one and a half times the annual Consolidated Salary,
payable annually, as may be approved by the Board of Directors or any Committee thereof.
c. Perquisites:
i. In addition to the aforesaid Consolidated Salary, and Variable Performance Linked Bonus, Mr. Sivaraman
shall also be entitled to perquisites and allowances including but not restricted to accommodation (furnished
or otherwise) or house rent allowance in lieu thereof; medical reimbursement and leave travel concession
for self and family; club fees; medical insurance; personal accident insurance; stock options; and such other
perquisites and allowance in accordance with the Rules of the Company as amended from time to time.
ii. The perquisites and allowances as mentioned above, shall be evaluated as per Income Tax Rules,
wherever applicable. In the absence of any such Rules, perquisites shall be evaluated at actual cost.
Provision for use of the Company’s car for official duties and telephone with fax at residence shall not
be included in the computation of perquisites.

6
 iii. Company’s contribution to Provident Fund and Pension/Superannuation Fund not exceeding 27% of
the consolidated Salary or such other percentage as may be permitted in law from time to time, to
the extent these either singly or together are not taxable under the Income Tax Act, 1961.
iv. Gratuity payable as per the Rules of the Company and encashment of leave as per the Rules of the
Company at the end of the tenure, shall not be included in the computation of perquisites
PROVIDED, however, that the overall remuneration including perquisites payable to Mr. Murali Sivaraman
together with the other whole-time Directors of the Company shall be within the limits specified under
Sections 198, 269 and 309 of the Act including Schedule XIII to the Act, that is ten per cent of the net
profits of the Company in any financial year.
d. Minimum Remuneration:
Notwithstanding anything hereinabove, where in any financial year during the terms of office of Mr. Murali
Sivaraman, the Company has no profits or its profits are inadequate, the Company will pay the aforesaid
remuneration by way of Consolidated Salary, Variable Performance linked bonus, and Perquisites as
Minimum Remuneration. This is subject to approval of the Central Government, if required.
e. Reimbursement of expenses incurred on joining duty:
Actual expenses incurred on travel and on packing, forwarding, loading or unloading as well as freight,
insurance, custom duty, clearing expenses, local transportation and installation expenses in connection with
moving of personal effects for self and family for joining duty in India may be allowed in case these have
not been claimed from the previous employer.
3. Other material terms:
Each party has the right of terminating the Agreement by giving to the other three calendar months’ notice in
writing.
The Resolution set out at Item No. 5 & 6 of the accompanying Notice is necessary in view of the provisions of
Section 269, 309 and other applicable provisions of the Act including Schedule XIII thereof. Members are requested
to approve the resolution.
None of the Directors of your Company, other than Mr. Murali Sivaraman is interested in the resolution at Item
Nos. 5 & 6.
The Explanatory Statement together with the Notice should be treated as an abstract of the terms of the draft
Agreement and Memorandum of Concern or Interest under Section 302 of the Act.
The draft Agreement referred to in the resolution at Item No. 6 of the accompanying Notice will be open for
inspection by the members at the Registered Office of the Company between the hours of 10 a.m. and 12 noon on
any working day except Saturday.
Item No. 7
Mr. Vineet Kaul was appointed a whole time Director of the Company with effect from January 30, 2003. His
appointment and the remuneration payable to him were approved by the Members at the Annual General Meeting
held on June 26, 2003. Mr. Kaul initial term of office as a whole time Director of the Company expires on January
29, 2008. The Board of Directors at its meeting held on November 2, 2007 has extended the tenure for the further
period of five years on the same terms and conditions.
The remuneration and perquisites of Mr. Kaul are set out in the draft Agreement referred to in the resolution at
Item No. 7 of the Notice and are subject to the approval of the shareholders of the Company under Sections 269
and 309 of the Companies Act, 1956 (‘Act’) read with Schedule XIII thereto.
The terms of the said Agreement are as follows:
1. The Agreement is for a period of five years from January 30, 2008.
2. Mr. Kaul shall be entitled to the following remuneration and benefits/perquisites from the Company provided
that the Board of Directors (hereinafter referred to as “the Board” which term shall be deemed to include any
Committee of the Board constituted to exercise its powers, including the power conferred by this Resolution),
is authorised to increase, reduce, alter or vary the remuneration and perquisites as such time(s) and in such
manner as the Board, may deem fit:
a. Consolidated Salary : Rs. 5,42,050/- per month or such higher amount as may be approved by the Board
of Directors or any Committee thereof.

Annual
Report 2007 7
 PHILIPS ELECTRONICS INDIA LIMITED

b. Variable Performance Linked Bonus: Not exceeding one and a half times the annual Consolidated Salary,
payable annually, as may be approved by the Board of Directors or any Committee thereof.
c. Perquisites:
i. In addition to the aforesaid Consolidated Salary, and Variable Performance Linked Bonus, Mr. Kaul shall
also be entitled to perquisites and allowances including but not restricted to accommodation (furnished
or otherwise) or house rent allowance in lieu thereof; medical reimbursement and leave travel
concession for self and family; club fees; medical insurance; personal accident insurance; stock options;
and such other perquisites and allowance in accordance with the Rules of the Company as amended
from time to time.
ii. The perquisites and allowances as mentioned above, shall be evaluated as per Income Tax Rules,
wherever applicable. In the absence of any such Rules, perquisites shall be evaluated at actual cost.
Provision for use of the Company’s car for official duties and telephone with fax at residence shall not
be included in the computation of perquisites.
iii. Company’s contribution to Provident Fund and Pension/Superannuation Fund not exceeding 27% of
the consolidated Salary or such other percentage as may be permitted in law from time to time, to
the extent these either singly or together are not taxable under the Income Tax Act, 1961.
iv. Gratuity payable as per the Rules of the Company and encashment of leave as per the Rules of the
Company at the end of the tenure, shall not be included in the computation of perquisites.
PROVIDED, however, that the overall remuneration including perquisites payable to Mr. Vineet Kaul
together with the other whole-time Directors of the Company shall be within the limits specified under
Sections 198, 269 and 309 of the Act including Schedule XIII to the Act, that is ten per cent of the net
profits of the Company in any financial year.
d. Minimum Remuneration:
Notwithstanding anything hereinabove, where in any financial year during the terms of office of Mr. Kaul,
the Company has no profits or its profits are inadequate, the Company will pay the aforesaid remuneration
by way of Consolidated Salary, Variable Performance linked bonus, and Perquisites as Minimum Remuneration.
This is subject to approval of the Central Government, if required.
3. Other material terms:
Each party has the right of terminating the Agreement by giving to the other three calendar months’ notice in
writing.
The Resolution set out at Item No. 7 of the accompanying Notice is necessary in view of the provisions of Section
269, 309 and other applicable provisions of the Act including Schedule XIII thereof. Members are requested to
approve the resolution.
None of the Directors of your Company, other than Mr. Vineet Kaul is interested in the resolution at Item No. 7.
The Explanatory Statement together with the Notice should be treated as an abstract of the terms of the draft
Agreement and Memorandum of Concern or Interest under Section 302 of the Act.
The draft Agreement referred to in the resolution at Item No. 7 of the accompanying Notice will be open for
inspection by the members at the Registered Office of the Company between the hours of 10 a.m. and 12 noon on
any working day except Saturday.
Item No. 8
As required under the provisions of Section 77A(3) of the Companies Act, 1956 (“the Act”) and Regulation 4 of
the Private Limited Company and Unlisted Public Limited Company (Buy-back of Securities) Rules,1999 as amended
upto date read with Schedule I annexed thereto (“Buy-back Regulations”), the following Explanatory statement sets
out the various details required to be disclosed.
1. The Board of Directors of the Company (“the Board”) at its meeting held on March 11, 2008 considered and
approved the proposal for Buy-back of fully paid up equity shares of the Company upto a maximum of
6,923,076 equity shares and cash outflow not exceeding Rs 1800 million (Rs. One thousand eight hundred
million only) at a price not exceeding Rs 260/- (Rs. Two hundred sixty only) per equity share (hereinafter
referred to as “the Buy-back”) in accordance with the provisions contained in Article 12A of the Company’s
Articles of Association and Section 77A and 77B and all other applicable provisions of the Act and the Buy-
back Regulations.

8
2. The Buy-back proposal is being suggested having regard to the fact that the shares of the Company are delisted
from the Stock Exchanges and, as a consequence thereof, the same cannot be traded on the floor of the Stock
Exchanges. The Buy-back will provide an option to the shareholders to sell their shares at the value arrived by
an independent valuer appointed by the Board.
3. The Buy-back is proposed to be implemented by the Company by adopting the methodology involving
purchase of the Equity Shares from the existing equity shareholders on a proportionate basis in such manner as
prescribed by the Act and under the Buy-back Regulations, and on such terms and conditions as may be
determined by the Board at a later date. The Company shall not Buy-back its shares from any person through
negotiated deal whether on or through spot transactions or through any private arrangements in the
implementation of the Buy-back. As an enabling provision, approval of the members is sought to empower the
Board to resort to other permitted methodologies of implementing the Buy-back including tender route,
subject to the Company fulfilling applicable Buy-back Regulations.
4. The equity shares of the Company are proposed to be bought back at a price not exceeding Rs 260/- (Rupees
two hundred sixty) per equity share in terms of the above resolution. This price has been arrived at as per the
valuation made by the reputed and independent valuer appointed by the Board for this purpose using accepted
valuation methodologies as considered relevant and appropriate by them. The Buy-back price as proposed
above, while providing an option to the shareholders to sell their shares at the value as derived above, will
ensure that the growth of the Company is not impaired in any way.
5. The Buy-back size represents 19.7% of the aggregate of the Company’s paid up equity capital and free reserves
as on December 31, 2007. The maximum numbers of shares to be bought back i.e. 6,923,076 shares represent
9.9% of the outstanding fully paid shares of the Company as on January 1, 2008. The above resolution seeks the
consent of the shareholders for the Board (including a Committee thereof) to determine the price and the
number of equity shares to be bought back by the Company within the aforesaid limits. The funds required for
the Buy-back will be met out of the free reserves of the Company. The debt equity ratio of the Company after
the Buy-back will be well within the limit of 2:1 as prescribed under the Act.
6. (a) The aggregate shareholding of the Promoters Koninklijke Philips Electronics N.V. (hereinafter referred to as
“the Promoters”) as on the date of this notice is 67,774,780 equity shares constituting 96.5% of the issued
share capital of the Company.
(b) No shares were either purchased or sold by the Promoters Koninklijke Philips Electronics N.V. during the
period of six months preceding March 11, 2008, i.e., the date of the Board Meeting at which the Buy-back
was approved and the date hereof.
7. The Promoters of the Company (Koninklijke Philips Electronics N.V.) intend to participate in the Buy-back by
tendering not more than 6,680,768 equity shares constituting not more than 9.5% of the issued share capital of
the Company at the price of Rs 260 per share.
8. As per the provisions of the Act, the special resolution passed by the shareholders approving the Buy-back shall
be valid for a maximum period of 12 months from the date of passing of the said Resolution. The Board shall
determine the time frame for completion of the Buy-back within this validity period.
9. In accordance with the regulatory provisions, the shares bought back by the Company will compulsorily be
cancelled and will not be held for re-issue at a later date.
10. In terms of provisions of section 77A(8) of the Act, the Company will not be entitled to make a fresh issue of
equity shares for a period of six months from the date of completion of the Buy-back envisaged under this
resolution except in cases/circumstances mentioned in the said section.
11. The Company confirms that there are no defaults subsisting in the repayment of deposits, redemption of
debentures or preference shares or repayment of term loans to any financial institutions or banks.
12. The Board confirms :
(i) that it has made the necessary and full enquiry into the affairs and prospects of the Company and has
formed the opinion:
a. that immediately following the date on which the general meeting is convened, there will be no
grounds on which the Company could be found unable to pay its debts; and
b. as regards its prospects for the year immediately following the date of the general meeting, that having
regard to their intentions with respect to the management of the Company’s business during that year
and to the amount and character of the financial resources which will, in the view of the Board be
available to the Company during that year, the Company will be able to meet its liabilities as and when

Annual
Report 2007 9
 PHILIPS ELECTRONICS INDIA LIMITED

they fall due and will not be rendered insolvent within a period of one year from the date of the
general meeting; and
(ii) in forming its opinion for the above purposes, the Board has taken into account the liabilities as if the
Company were being wound up under the provisions of the Companies Act, 1956 (including prospective
and contingent liabilities).
13. The text of the report dated March 11, 2008 received from Messrs. BSR & Co, Chartered Accountants, the
statutory auditors of the Company, addressed to the Board of Directors is reproduced below :
TEXT OF AUDIT REPORT
Report under Schedule 1 Clause (xiii) of the Private Limited Company and Unlisted Public Limited Company (Buy-
back of Securities) Rules,1999.
1. In connection with the proposed buyback of Equity Shares approved by the Board of Directors of PHILIPS
ELECTRONICS INDIA LIMITED (‘the Company’) at its meeting held on March 11, 2008, in pursuance of the
provisions of the Companies Act, 1956 and the Private Limited Company and Unlisted Public Limited Company
(Buy-back of Securities) Rules,1999 and based on the information and explanations given to us, we report that :
a. we have enquired into the state of affairs of the Company in relation to its audited accounts for the year
ended December 31, 2007, which were taken on record by the Board of Directors at their meeting held
on March 11, 2008.
b. the capital payment (including premium) of an amount not exceeding Rs. 1800 million towards the Buy-
back of equity shares has been properly determined in accordance with Section 77A(2)( c) of the
Companies Act, 1956 and is within the permissible amount of 25% of the paid up equity capital and free
reserves of the Company, as computed below:
As on December 31, 2007 Amount in Rs Mln
Share Capital 703
Free Reserves
Securities Premium 679
General Reserve 6057
Balance in Profit & Loss Account 1695
Less : Miscellaneous Expenditure to the extent
Not written off or amortized NIL
Total paid up capital and free reserves 9134
Maximum amount permissible for buy-back i.e. 25% of the
Paid up capital and free reserves (Section 77A(2) (c)) 2284
Restricted to 1800
c. the Board of Directors in their meeting held on March 11, 2008 have formed their opinion as specified in
clause(xii) of Schedule 1 of the Private Limited Company and Unlisted Public Limited Company (Buy-back
of Securities) Rules,1999 on reasonable grounds and that the Company will not, having regard to its state
of affairs, be rendered insolvent within a period of one year from the date of the Annual General Meeting
of the members of the Company proposed to be held on June 13, 2008.
d. Based on the representations made by the Company and other information and explanations given to us,
which to the best of our knowledge and belief were necessary for this purpose, we are not aware of
anything to indicate that the aforementioned opinion expressed by the directors is unreasonable in the
present circumstances.
This report has been issued solely in connection with the proposed buy back of shares of PEIL and may
not be suitable for any other purpose.
By the Order of the Board
R J Wani
Company Secretary

New Delhi, Date: 11 March, 2008

10
DIRECTORS’ REPORT
For the Financial Year Ended December 31, 2007.
Your Directors submit their report and audited accounts for the year ended December 31, 2007.
2007 for India was a year of ups and downs, mostly of expectations. The economy surged by over 9% in the fourth
quarter of 2006, leading many to believe that growth rate could be sustained, if not exceeded. But by mid-year, we
had indications of problems in US financial markets that could have serious consequences for the global
economy. Today India is a $1 trillion economy, growing at an average of 8% a year. With over a billion consumers,
a growing middle class and world-class entrepreneurs, we believe India is best positioned among all emerging
economies to withstand the risk of global downturn. And, as one of India’s most respected consumer brands, we
are at the heart of the biggest ‘all-weather’ growth stories.
Your Company’s performance during the year was strong, with robust top line growth and high quality earnings. All
business segments posted strong growth in revenue and increase in respective market share. The Lighting business
continued to perform strongly both in respect of turnover and profitability. Consumer Electronics recorded a
growth of 20%, Medical business grew by 21% and Domestic Appliances and Personal care business grew by 37%
during the year 2007. The profitability of the Consumer Electronics and Medical business improved substantially as
compared to the previous year. Philips strategy globally is to focus on three key areas, viz. Growth, Talent and
Simplicity. India will continue to be a key market for Philips from the growth and development perspective.
1. FINANCIAL PERFORMANCE
1.1. RESULTS
RS. Mln.
2007 2006
Gross Income 29,363 26,735
Operating profit 2,456 1,485
Exceptional items (net) 438 1,544
Profit before tax 2,894 3,029
Fringe benefit tax (38) (61)
Provision for current tax (939) (824)
Provision for deferred tax (14) (14)
Profit after tax 1,903 2,130
Transfer to General Reserve 190 1,970
1.2. DIVISIONAL SALES
2007 2006
Lighting 12,626 10,970
Consumer Electronics 8,356 6,962
Medical Systems 3,415 2,804
Domestic Appliances & Personal Care 1,780 1,300
Innovation Campus 2,395 3,782
Others 334 668
Total 28,906 26,486
Sales for the year ended December 2007 reported a nominal growth of around 10%, but the operating profit
grew by 65% largely due to changes in distribution pattern and better product mix. Sales on a comparable basis,
i.e. after excluding Semi Conductors, has grown by 19%. Profit before tax was lower as compared to the
previous year on account of a sharp reduction in income from exceptional items.

Annual
Report 2007 11
 PHILIPS ELECTRONICS INDIA LIMITED

1.3. FINANCE & ACCOUNTS

Your Company delivered a strong performance in cash generation during the year, driven by the strong
operating performance, better realization and working capital management and sale of assets/ business. The
cash surplus was invested in financial instruments in accordance with the policy of the Company. In terms of the
provisions of Investor Education and Protection Fund (awareness and protection of investors) Rules 2001, Rs.
25.82 lakhs of unpaid/unclaimed dividend was transferred during the year to the Investor Education and
Protection Fund.
2. DIVIDEND
Your Directors recommend payment of Rs. 2.0 per share as dividend on the fully paid equity shares for the financial
year ended 31 December 2007. This will absorb Rs. 140 million as dividend and Rs. 28 million as dividend tax.
3. BUSINESS PERFORMANCE
The Notes to the Profit and Loss Account for the year provide segment results. Required disclosure is made below
for Lighting, Consumer Electronics, Innovation Campus (Software), Medical Systems, Domestic Appliance and
Personal Care divisions.
3.1 LIGHTING
The Division grew more than 15%, making it the sixth year of consecutive double digit growth. All the business
groups of the division grew in double digit profitability for the year. This growth helped the division to improve the
market share of 30% in the Industry, despite the growth of existing players and the entry of new lighting and non -
lighting players in the Industry.
New products in all categories were introduced. Recently created avenues/ channels such as rural & replacement
markets were leveraged further to improve reach and sales. On the professional front, new stadia, viz. Ranchi,
Bhopal, airport lighting and major infrastructure projects were executed. Inroads were also made into the areas of
Retail and Solid State lighting.
On the manufacturing side, manufacturing capacity in CFL was enhanced to cater to the needs of the local Market.
Reorganisation of the Industrial Activity in the Lighting Electronics business is completed. The (Global) company is
considering the setting up of Global Manufacturing capacities and (product) Development Centres in India in the
near future.
Going forward in 2008, the division has plans to increase its profitability as in the previous year. The division intends
to reap the benefits of the intended focus on energy savings in Lighting, the current boom in infrastructure as also
the Commonwealth Games scheduled for 2010.
3.2 CONSUMER ELECTRONICS
The Consumer Electronics Division recorded a strong performance in 2007, registering a growth of 20%. This was
aided by strong performances in all the business segments, viz., Video & Multimedia Applications (VMA), Audio &
Multimedia Applications (AMA) and Colour Televisions (CTV), enhanced by significant improvements in operational
efficiencies and strong business controls.
Colour Television (CTV) business grew by 23% aided by 6 times value growth in the LCD category. The CTV
market in India is witnessing a rapid transition from the traditional cathode ray tube TV to LCD Flat TV with
consumers from the upper middle class as well as the middle class segments opting for the latter. This is propelling
the growth in the Consumer Electronic industry and going by market estimates, the LCD TV market is likely to
cross the current CRT TV market size by year 2010.
The Company established the LCD TV business quite strongly in 2007 and clearly sees a window of opportunity to
become a significant brand in this space. LCD TV is perceived by the Indian consumer as a technology driven
product and Philips in India has the image of being a technology driven company. Our strategy in CRT TV will be to
continue to have an opportunistic play with a clear focus on the growing categories, i.e. 21" & 29" Real Flat.

12
3.3 MEDICAL SYSTEMS
The Medical Systems Division operates in the Diagnostic Imaging segment, which includes CT, MRI, X-rays,
Cardiovascular Systems, Nuclear Medicine, PET-CT and Ultrasound Imaging Systems, and is also a significant player
in patient monitoring.
In 2007, the Division recorded strong growth in most business lines, winning major contracts across its entire
product range, including those from major private hospital groups as also from large Government postgraduate
teaching hospitals. Strong account management backed by excellent customer focus has been the key success factor
of the year.
There was excellent growth in the Magnetic Resonance Imaging (MRI) business during the year 2007 in both 1.5
and 3 Tesla segments. Cardiovascular X-ray (Cath labs) registered a record growth both in volume and value and
was a leader in the segment. Computerised Tomography (CT) systems continued to do well during 2007. The
Cardiovascular Ultrasound segment, especially the Live 3D echo market, was dominated by Philips and 4-dimension
systems contributed to the success of the Ultrasound equipment group in 2007. The Customer Support group has
performed consistently well, meeting and often exceeding customer expectations, resulting in good loyalty-based
repeat orders.
3.4 DOMESTIC APPLIANCES & PERSONAL CARE
The Domestic Appliances and Personal Care Division sales grew by 37% during the year. Innovative products such
as ‘Intelligent water purifier’ and ‘Hands Free Intelligent Indian Food Processor’ were launched during the year. The
business established the highest ever brand preference for its lead categories such as mixer grinders, juicers & irons.
In a year of high launch investments and increase in raw material price the business maintained its profitability. The
outlook for 2008 is one of stronger growth and continued emphasis on new product launches.
3.5 INNOVATION CAMPUS (PIC)
PIC’s strength at the end of 2007 was 978 as compared to 940 at the end of 2006. The retention rate remained
reasonable as compared to the IT industry average. During the year the Healthcare group expanded its activities to
cover not only software engineering but also electrical and mechanical fields. Sales (total deliveries) amounted to
Rs. 2395 million as compared to Rs. 3,782 million in 2006. However, sales in 2006 included deliveries of Rs. 1381
million in respect of the Semiconductor Division which was spun off to NXP Semiconductors. On a comparable
basis, there was a nominal decline in sales from Rs. 2,401 million in 2006 to Rs. 2395 million in 2007 - the primary
reason being the reductions in Consumer Lifestyle group.
4. BUSINESS RESTRUCTURING
Globally, Koninklijke Philips Electronics N.V. (‘KPENV’), the promoter of your Company, has announced a simplified
organizational structure in three market sectors, viz Philips Healthcare, Philips Lighting and Philips Consumer
Lifestyle. This new organizational structure came into effect from January 1, 2008. Healthcare and Lighting are largely
unchanged. The creation of Consumer Lifestyle is a major event in Philips history: Domestic Appliance and Personal
Care division (‘DAP’) and Consumer Electronics division (‘CE’) will cease to be separate businesses and will be fully
integrated to form the Consumer Lifestyle sector.
5. NEW CORPORATE OFFICE
As a part of the Company’s One Philips initiative, your Board has decided to move its Corporate Offices to a new
state-of-the-art office space at DLF Cyber City, Gurgaon. This move will integrate all existing business offices of the
Company at Pune, Delhi and Mumbai and the process is likely to be completed by end 2008.
A unified corporate office will help to further integrate business processes and leverage scale and synergies across
the organization. Working from one office, at one location, offers managers the opportunity to communicate and
interact across divisional and functional boundaries. By being together, the management will have opportunities for
interaction with different parts of the Company to create a stronger, more cohesive Philips in India. It will enable the

Annual
Report 2007 13
 PHILIPS ELECTRONICS INDIA LIMITED

Company to drive its key agenda of growth and support with larger strength - the parent strategy of Vision 2010.
The move will be cash flow positive, since it will largely be funded out of realization of the Company’s two
residential complexes located at Mumbai and Pune.
6. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
Your Company remains committed to maintaining internal controls designed to safeguard the efficiency of operations
and security of our assets. Accounting records are adequate for preparation of financial statements and other
financial information. Through our internal audit processes at divisional and corporate levels, both the adequacy and
effectiveness of internal controls across the various businesses and compliance with laid-down systems and policies
are regularly monitored. A trained internal audit team also periodically validates the major IT-enabled business
applications for their integration, control and quality of functionality. The Audit Committee of the Board met
periodically during the year to review internal control systems as well as financial disclosure.
7. CORPORATE SOCIAL RESPONSIBILITY
Your Company has been able to make significant contributions in Economic, Environmental and Social areas by tying
up with effective social partners / NGOs, in the year 2007. Arogyakiran, Healthcare Initiatives & Tsunami Relief
Projects and Rehabilitation are some of the ongoing projects supported by Philips. Project Arogyakiran focuses on
providing primary healthcare to rural villages near Kolkata and Vadodara. Over the last three years 1020 pregnant
women were identified and supported with Ante Natal Care (ANC) and Post Natal Care (PNC) at the Child in
Need Institute (CINI), Kolkata.
With the help of “Trust for Reaching the Unreached”, a voluntary organization based at Kural village near Vadodara,
your Company makes available cost-effective and easily accessible primary and preventive healthcare to 16 villages
with a population of nearly 38,000 people, through 4 dispensaries run by qualified doctors who provide subsidised
diagnostic care to patients. This organization also arranges referrals for needy patients.
8. NEW BUSINESS INITIATIVES
The New Business Development function is working towards the realisation of the Company’s growth ambitions up
to the year 2010. It focuses on new business areas in the Lifestyle and Healthcare domain, new product development
and/or new product portfolio extensions and addresses strategic initiatives to penetrate and develop markets in the
Indian Subcontinent, as well as some key “One Philips” initiatives such as Key Sector Management in retail,
healthcare and hospitality.
9. BUY BACK OF EQUITY SHARES
Pursuant to the provision of Article 12A of the Articles of Association of the Company and in accordance with the
provision of Section 77A and 77B and all other applicable provisions, if any, of the Companies Act 1956, and the
provisions contained in the Private Limited Company and Unlisted Public Limited Company (Buy-back of Securities)
Rules, 1999, consent of the Company is sought for the buy back of fully paid up equity shares of the face value of
Rs 10/- each up to a maximum of 6,923,076 equity shares and cash outflow not exceeding Rs. 1800 million
(Rs. One thousand eight hundred million only) at a price not exceeding Rs. 260/- (Rs. Two hundred sixty only) per
equity share. The Buy-back will provide an option to the shareholders to sell their shares.
10. HUMAN RESOURCES AND INDUSTRIAL RELATIONS
Employee relations were cordial during the year. The Company continues to invest in the development of its
employees by way of various internal and external training programmes.
As part of People Development efforts, the Learning & Development needs of employees were identified and
addressed on an ongoing basis. In addition to the ongoing leadership development programmes, the focus was on
development of functional skills with emphasis on Sales and Marketing. Some of the key programmes rolled out
included Key account management, Direct dealer management, and Service excellence workshops.

A unique “Think Simplicity” contest was launched around new brand positioning “Sense and Simplicity”. The

14
purpose was to encourage employees to realize and appreciate the value of Simplicty in their daily lives. The
response was overwhelming - 1097 entries, 19 unit level winners were felicitated and the 7 national winners
participated in the Simplicity event in London.
Information under Section 217 (2A) of the Companies Act 1956, read with the Companies (Particulars of
Employees) Rules, 1975, forms part of this report.
11. CONSERVATION OF ENERGY, FOREIGN EXCHANGE OUTGO AND TECHNOLOGY ABSORPTION
Information pursuant to Section 217(1)(e) of the Companies Act, 1956, is provided in the Annexure to this report.
12. ENVIRONMENT, ENERGY, OCCUPATIONAL HEALTH & SAFETY
Your Company is committed to implementing the Philips Sustainability Policy and is striving to continuously improve
its contribution to the environmental, economic and social aspects of sustainability. The manufacturing units of your
Company are actively involved in implementing the Philips Eco-Vision III (2006-2009) programme. All manufacturing
units have established and are maintaining ISO-14001 certified environmental management systems.
Products and Systems introduced by your Company go through a process of EcoDesign. Your Company has also
initiated several programmes to improve the Health and Safety of employees working in the manufacturing units and
offices.
13. DIRECTORS’ RESPONSIBILITY STATEMENT
As required under Section 217 (2AA) of the Companies Act, 1956, your Directors confirm that:
i) in the preparation of the annual accounts, applicable accounting standards have been followed;
ii) the Directors have selected such accounting policies and applied them consistently and made judgments
and estimates that are reasonable and prudent, so as to give a true and fair view of the state of affairs of
the Company as on December 31, 2007 and of the profit of the Company for the year ended December
31, 2007;
iii) the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in
accordance with the provisions of this Act, to safeguard the assets of the Company and to prevent and
detect fraud and other irregularities;
iv) the Directors have prepared the annual accounts on a going concern basis.
The Company’s Internal Auditors have conducted periodic audits to provide reasonable assurance that the Company’s
established policies and procedures were followed. The Audit Committee constituted by the Board meets regularly
with Internal Auditors and also with the External Auditors to review internal control and financial reporting issues.
14. DIRECTORS
Mr. Rajeev Bakshi resigned from the Board effective April 19, 2007, after serving on the Board for over one and a
half years. The Board records its deep appreciation of the valuable contributions made by Mr. Bakshi to the Board’s
deliberations. The Board, at its meeting held on April 19, 2007, appointed Mr. Murali Sivaraman as Additional
Director and Managing Director designate with effect from July 2, 2007.
Mr. K Ramachandran, Vice-Chairman & Managing Director of your Company, resigned from the Board with effect
from October 3, 2007, following his retirement from the Company. Your directors wish to record their appreciation
of the long and meritorious services rendered by him. Mr. Murali Sivaraman was appointed as Vice-Chairman and
Managing Director of the Company with effect from October 3, 2007. The Central Government has approved the
appointment of Mr. Sivaraman which is valid till the conclusion of the ensuing Annual General Meeting and will be
further extended subject to the approval of Shareholders at the said meeting. Due notice has been received from
members pursuant to Section 257 of the Companies Act, 1956, of their intention to move resolution for the
appointment of Mr. Murali Sivaraman as a Director of the Company.

Annual
Report 2007 15
 PHILIPS ELECTRONICS INDIA LIMITED

The Board extended the term of office of Mr. Vineet Kaul as a Whole-time Director of the Company, for a further
period of five years from January 30, 2008 or till the age of retirement, whichever is earlier. Appropriate resolution
seeking your approval to such extension and remuneration of Mr. Vineet Kaul appears in the Notice convening the
78th Annual General Meeting of the Company.

Mr. Alexius Collette retires by rotation at the ensuing Annual General Meeting. The Board recommends his re-
appointment.

15. AUDITORS

Messrs. BSR & Co. retire as auditors of the Company and, being eligible, offer themselves for re-appointment. Your
Directors recommend their re-appointment for the ensuing year.

16. COST AUDITORS

The Central Government has directed your Company to carry out an audit of the Company’s cost accounts in
respect of electric lamps, pursuant to the provisions of Section 233B of the Companies Act, 1956. Accordingly, your
Directors have approved the appointment of Messrs. R. Nanabhoy & Co., a firm of cost accountants, to conduct the
audit for the year ending December 31, 2008.

17. GENERAL

Your Directors acknowledge the close cooperation and support your Company has received during the year from
the employees, members, its parent company Koninklijke Philips Electronics N.V., its bankers, and business partners
including suppliers, co-makers and the trade.

On behalf of the Board

S. M. Datta
New Delhi, March 11, 2008 Chairman

16
Annexure to Directors’ Report

INFORMATION REQUIRED UNDER SECTION 217 (1)(E) OF THE COMPANIES ACT, 1956.

RESEARCH & DEVELOPMENT (R & D) : JANUARY - DECEMBER 2007

1. Specific areas in which R & D is carried out The Company’s management believes that continuous effort
by the Company to establish a strong performance in the fields of R & D vis-a-
vis product and process development and import substitution
are of paramount importance to preserve and strengthen the
competitive position the Company holds in various product
segments. The Company’s R & D laboratories have been
instrumental in providing the Company with a sustainable
competitive advantage through application of Science and
Technology.
The specific areas in which R & D is carried out include:
a. Development of new energy saving optics for road lighting
/ floodlighting / officelighting luminaires to make products
less and less material intensive and more energy efficient
and enviroment friendly.
b. Development of knowhow of luminaires driven by
alternate energy source i.e Solar.
c. Development of optimal luminaires for TL5/CFL lamps
for home applications.
2. Benefits derived as a result of R & D Development of 21 new products for consumer / indoor and
outdoor application involving high performance electronic
ballasts and energy efficient lamps like PLL/TL5/CDMTT.
3. Future plan of action Have a roadmap for 2008-2010 with high emphasis on office
lighting / shop & mall lighting / street and flood lighting
luminaires based on conventional and non conventional (solid
state Lighting) lamp source.
Rs. Mln
4. Expenditure on R & D a. Capital 1
b. Recurring 39
c. Total 40
d. Total R & D expenditure as % of total 0.14
turnover

TECHNOLOGY ABSORPTION, ADAPTATION AND INNOVATION

1. Efforts, in brief, made towards technology As a result of our access to international technology from
absorption, adaptation and innovation Koninklijke Philips Electronics NV in terms of products,
production techniques and processes etc., our R & D
Laboratories absorb & adapt these new concepts on a
continuous basis to suit local conditions . These are achieved
through continuous interaction with our foreign affiliate, other
international bodies and manufacturers and through exchange
of knowledge, information, visits and training etc. New Optics
from Europe / manufacturing technology of Formed Glass /

Annual
Report 2007 17
 PHILIPS ELECTRONICS INDIA LIMITED

Newcoating process/ SSL design technology from Europe and

Selection of alternative materials for Luminaire construction.
The technology for using solar power as driver to CFL based
luminaires from Europe.
2. Benefits derived as a result of above efforts, Continuous development of new products , concepts and
e.g. product improvement, cost reduction, processes resulting in increased efficiency, cost reduction and
product development, import substitution. import substitution.
Attainment of higher customer satisfaction / better
environmental scoring/growth in business.
3. In case of imported technology (imported Technology imported Year of commencement of
during the last 5 years reckoned from the production
beginning of the financial year) following
information may be furnished. Nil Not applicable

FOREIGN EXCHANGE EARNINGS AND OUTGOINGS Rs. Mln

Foreign exchange earned 3,143
Foreign exchange used:
i. Import of capital goods 177
ii. Import of raw materials, piece parts & spares 901
iii. Other expenditure 1,759 2,837

ENERGY CONSERVATION MEASURES

The following energy conservation measures were implemented during January / December 2007.
1. Re-engineering of cooling water circulation system in Glass Factory
2. Compressed Air system Pressure regulation on PID Controller.
3. Efficiency improvement of Return cullet conveyor system.
4. Lighting system on auto control.
5. VTL 1 Blowing air for sintering furnace regulating system on PID Controller.
6. GLS/VTL packing machine motor auto mode.
7. Ribbon machine interlock with air circulating fans.
8. Installation of additional 380 kva Gas generator set to reduce Electrical power cost & Reduction of CO2.
9. Installation of zero Loss auto drain valve in compressed air system.
10. Auto switching of oxygen in flare machine and GLS machine.
11. Installation of energy management system.
12. Use of chilled water for room AC System in Glass Factory.
13. Bulb cooling system in ribbon machine on VFD.
14. AHU System of Lamp plant Damper system with AC Drive.
15. Reduction of propane gas consumption by changing T-8 rollers on VTL sinteroven.
16. Monolux insulation changed on VTL pump oven to reduce heat losses as to get savings in power.
17. Peak load exemption & Continuous power status from PSEB to save HSD.
18. Reduction of blower air pressure in the process from 2000 MMWC to 1900 MMWC.
19. Lighting energy saver for factory lighting to save power.
20. Installation of solar water heater for factory canteen.
21. False ceiling in furnace control room to reduce air conditioning load.

18
POWER & FUEL CONSUMPTION AT GLASS FACTORIES
Particulars Unit 2007 2006
Electricity
a. Purchased
Unit 000 kwh 27,100.12 22,650.00
Rate Rs/kwh 4.67 4.45
Total Rs.000 126,576.46 100,851.00
b. Own generation
Unit 000 kwh 3,328.17 6,310.00
Rate Rs/kwh 4.16 6.13
Total Rs.000 13,828.42 38,705.00
Total electricity 000 kwh 30,428.29 28,960.00
Cost Rs.000 140,404.88 139,556.00
Particulars
LPG/Propane/Natural Gas
Unit Tonnes 11,383.13 10,802.00
Rate Rs./Tonne 32,360.81 31,197.08
Total Rs.000 132,257.05 109,292.00
Furnace oil
Unit KL 2,147.00 2,140.00
Rate Rs./KL 19,726.13 18,755.00
Total Rs.000 42,352.00 40,137.00
Consumption per kg. of glass production
2007 2006
Product Unit TL SHELLS / GLS TL SHELLS / GLS

Electricity Kwh 0.14 0.13

Furnace oil Ltr 0.05 0.05
LPG Kg 0.02 0.02

STATEMENT OF PARTICULARS OF EMPLOYEES AS REQUIRED UNDER SECTION 217 (2A ) OF THE COMPANIES ACT, 1956
JANUARY - DECEMBER 2007
Name Qualification Date of Designation Previous Employer Experi- Age Remune-
Joining ence ration
Gross
A D A Ratnam ACA, ACS, B.Com 01/11/2004 Sr.Director - Lighting F&A Baxter India P Ltd 19 41 4,867,952
A P S Sandhu B.Sc,MBA 01/11/1988 Director Pushkar Electronics 19 42 2,496,887
Ajay Mahajan B.E 31/08/1998 Sr. Software Architect Menon Information Technology 13 37 2,413,404
Ajit Ashok Shenvi B.E 25/06/1999 Quality Manager - CE L&T Limited 14 35 2,788,907
Akhilesh Kumar Goel M.Sc (Engg), BE, B.Sc 04/05/2006 Director- Mohali Light Factory Areva T&D India Ltd 16 42 2,496,104
Alexius Maria Josephus C M.E 24/01/2006 CEO - Philips Innovation Campus Royal Philips Electronics NV., Netherlands 35 60 19,305,704
Anasuya Thammineni B.Tech 23/03/2004 Program Manager Motorola India Electronics Pvt Ltd 12 36 2,529,990
Anil Naraindas Punjwani B.E 27/03/2006 IT Head AGM Infrastructurecaritor 16 40 2,592,146
Anjan Bose B.E - Tech 11/06/2004 Sr.Director Datex Ohmeda 30 53 9,406,593
Arjun Shahani B.E, MMM 08/12/2003 Sr.Director-Lighting Commmercial LG Philips Displays India Pvt Ltd 24 45 3,861,122
Ashish Mendiratta B.E,PGDIE 15/11/2005 Director Ballapur Industries Ltd 17 42 3,007,811
Bakthavathsalu Mannan Ph.D 17/06/2002 IP Search Manager GE India Tech Centre Pvt Ltd 25 53 3,086,825
C J M Reuvers MBA 08/08/2006 CFO Royal Philips Electronics NV., Netherlands 34 55 28,984,169
Debabrata Das B.E 27/05/1991 General Manager Genelec Ltd 19 46 2,544,910
Debajyoti Dasgupta B.Com,B.Sc,ACA 19/04/1993 Director Price Waterhouse Coopers 15 42 2,470,645
Debasish B.E 16/10/2000 Sr. Project Manager Asea Brown Boveri Ltd 17 38 2,535,261
Devdatt K B.E 27/01/1999 System Architect D.E.Shaw India 14 37 2,577,166
Dinesh Kumar B V B.E 08/05/2000 General Manager Motorola India Electronics Ltd 22 47 3,761,657
Geetha Mahadevaiah B.E 08/05/2000 General Manager Subex Systems Ltd. 23 45 3,909,729
Gertjan Yntema M.Sc 01/08/2007 Director - AppTech Royal Philips Electronics NV., Netherlands 1 35 3,904,224
Girish Chander Kalia B.E 01/09/1998 Systems Architect Indian Air Force 15 37 3,167,430
Gunjan Kumar Srivastava B.Tech, PGDM 08/03/2004 Senior Director Integrated Tech solutions Pvt Ltd 15 40 3,018,890
Guruprasad Krishanamurthy B.E 20/09/1999 Group Project Manager Larsen & Toubro Information Tec 13 36 2,879,182
Hemakumar K S B.E 08/01/2001 Sr. Technology Specialist Robert Bosch India Ltd. 20 44 3,334,459
Jelle Rieske M.Sc 23/04/2005 Sr. Director -PCE Royal Philips Electronics NV., Netherlands 27 50 13,861,585
Joseph Shields Ph.D 03/10/2006 General Manager - New Business Development Infosys Technologies Ltd 7 39 2,886,583

Annual
Report 2007 19
 PHILIPS ELECTRONICS INDIA LIMITED

STATEMENT OF PARTICULARS OF EMPLOYEES AS REQUIRED UNDER SECTION 217 (2A ) OF THE COMPANIES ACT, 1956
JANUARY - DECEMBER 2007
Name Qualification Date of Designation Previous Employer Experi- Age Remune-
Joining ence ration
Gross

K Sairam Sekhar B.A 07/06/1985 Director - Lighting Commercial Eureka Forbes Ltd 22 45 2,865,560
Kedar Avinash Medhi B.E 18/07/2000 Sr. Project Manager - 13 34 2,438,673
Kishin Gandhi R M B.E 16/08/2000 Sr. Project Manager BPL Ltd 18 41 2,511,878
Kishore Reddy T N B.Tech 10/03/1997 Director Sage Design Sys 14 35 5,228,092
Krishnamohan Y Rao B.Com., MBA 01/12/2006 Sr. Director - HR ST Microelectronics 21 43 3,435,576
Kumar S L B.E 11/06/1997 Sr. Software Architect M/S Micron Inst 15 34 2,951,657
Kunal Chaudhuri B.E (Mech) 14/09/1984 General Manager Machinery Manufacturers Corp Ltd 27 51 2,655,918
L Ramakrishnan Ph.D, M.Sc,B.Sc, PUC 18/10/1982 General Manager-Lamp Bakelit Hylam Ltd 29 57 2,704,174
Madhusudhan K T M.E 02/01/1998 Sr. Project Manager Polaroid 11 33 2,594,174
Mahesh Viswanathan B.Com, A.C.A 01/01/2007 Sr.Director - Finance Pennar Acominium Co Ltd 24 48 3,987,308
Manoj A K B.Tech 19/07/1999 Sr. Software Architect BPL Limited 13 36 2,524,112
Mini T T B.Tech 12/02/2001 Sr. Software Architect Bharat Electronics Ltd 13 36 2,421,886
Mohana Krishnaiah Ph.D 06/02/2003 Sr. Technology Specialist Espace Technologies 15 43 2,816,440
Mohandeep Singh MBA 13/07/2006 Director- National Sales Asian Paints India Ltd 13 38 2,906,873
Narendra N Pawar B.E 01/09/2005 Project Manager Philips Electronics Singapore Pte Ltd 16 40 5,791,214
Nataraj Kumar S B.E 12/07/2000 Program Manager - TEST BPL Limited 17 39 2,744,807
Nevenka Dimitrova MS., 01/07/2006 Research Fellow Royal Philips Electronics NV., Netherlands 23 47 8,491,080
P Perianayagam B.E - Electronics 02/11/1987 General Manager Electronics Corporation of India 23 45 2,734,853
Padma Lakshmi Anoop Kulka B.E 03/08/1998 Sr. Software Architect Tata Consultancy Services 14 36 2,516,241
Padmaja Korde B.A.,MS., 02/06/1996 General Manager - Organisation Development Mafatlal Industries Ltd 17 41 3,882,302
Pallavi K B.E 07/01/1999 Program Manager Hewlett Packard 13 37 2,416,461
Pradyot Krishna Sinha B.Com, MBA 08/03/2000 Director - Forwarding & Distribution Cussons India Pvt Ltd 17 41 3,502,278
Pramod C B.Tech,M.Tech 07/10/1996 System Architect Wipro GE Medical Sys Ltd 13 35 2,723,741
Pritam P Bhosale B.E 14/05/2001 Sr. Project Manager Technical Stacadence 12 36 2,513,526
Design Systems (I) Pvt Ltd
Purnendu Sinha Ph.D 01/06/2005 Principal Scientist - A IIIT-BANGLAORE 10 40 2,886,211
R Nandakishore B.E (Elects) MBA IIM 03/06/1985 Director - Lighting Commercial - 26 53 4,095,111
R P Singh Gandhoke MBA, MSW, BA 15/09/1995 Director-HRM Bharat Electronic Ltd 30 55 3,302,230
R Sridharan MS in Bio Med:Eng: 18/06/1986 General Manager ATL India Ltd 22 47 2,706,482
Raghav K Narayan MS-Maths 21/08/2006 Technical Expert Philips Medical Systems Inc-Andover 22 46 9,965,601
Raghavendra R Patil B.E 24/03/2000 Program Manager NELCO/GETS, ERIE, PA, USA 24 48 4,096,822
Raghvendra Deshpande B.E 22/05/2000 General Manager IT Solutions 17 39 4,068,142
Rajiv J Wani B.Com,CS,LLB,PGD Tax 01/09/1986 General Manager Precision Fasteners 27 49 2,528,355
Rakesh Sharma B.Sc (Engg), MBA 18/08/1980 Senior Director - BG Dap Dept of Business Administration, 29 53 6,303,289
Punjab University
Ramamoorthy A PUC 03/11/2000 Sr. Software Architect Bharat Heavy Electricals Ltd 15 41 2,581,152
Ramani M V Ph.D 16/08/2004 Patent Engineer GE INDIA TECH.CENTRE 12 47 2,489,770
Ramanjit Singh B.Sc,MBA 26/10/1985 Director Gurunanak Auto Enterprises 23 47 2,493,307
Rani M R B.Sc.,M.Sc., 22/01/2003 General Manager - Software Engineering Group Motorola India Electronics Ltd 20 43 3,840,877
Ravi T V Ph.D 17/06/2002 Patent Engineer SAP Labs India Pvt Ltd 13 42 2,450,846
S Bhaskaran B.Tech 06/07/1998 Sr. Director - PMS & PBS Bharat Heavy Electricals Ltd 24 48 6,839,745
S H Denissen M.Sc 15/05/2007 Senior Technical Specialist Royal Philips Electronics NV., Netherlands 1 27 3,757,644
S Nagarajan PGDM, (IIM) 23/01/2004 Sr.Director - CE Sales & Service Joyco India Ltd 22 46 5,466,379
S R Srinivasan B.Com,M.Com 08/10/1984 General Manager Spaco Carb Urettors (I) Ltd 26 50 2,606,701
S Talwar B.E Chemical Engineering 18/02/1986 Senior Director - Lighting Industrial Punjab Alkalies & Chemicals Ltd 35 59 4,822,024
- MBA
S Venkatramani B.E. (Mech) 17/11/1971 Executive Director & Sr Vice President - Lighting Standard Machine Tools 39 62 19,195,734
Safeer I B.Tech 03/11/1999 Program Manager- Process Improvement HCL Technologies India P Ltd. 16 41 2,816,252
Sanjay Bapna B.E 13/01/1997 General Manager Hewlett Packard 22 47 2,703,593
Santosh Kumar V B.E 31/07/2000 Systems Architect Robert Bosch India Ltd 12 37 2,762,333
Sathian T Nair B.E 29/03/2004 Sr. Project Manager Intel Technology India Pvt Ltd 14 36 2,421,557
Sathyanarayanan B B.Sc 21/08/2006 General Manager, P-BAS Delivery Grp Hewlett Packard 15 41 3,986,246
Serge Antony Martin Hermans M.Sc 02/01/2006 Software Architect Royal Philips Electronics NV. 10 35 6,271,453
Shashi Bhushan Mehta M.E 27/01/2003 Sr. Technology Specialist GEITC 23 52 3,174,475
Shiva Kumar K R B.E,M.E, 03/11/1997 Sr. Principal Engineer PCL MINDWARE 17 39 4,810,599
Shyam Vasudevarao Ph.D 05/07/2004 Director -Technology Tata Consultancy Services 19 48 4,472,857
Souri Rajan V B.E 11/06/2001 Sr. Software Architect CISCO Systems 12 34 2,553,446
Sreenath Lt K B.E, MBA 15/01/1998 Sr. Project Manager LEC India Software 19 42 2,722,425
Sreenivasa Chary B.E 24/12/1999 Sr. Software Architect Defence Research & Dev. Organisation 12 39 2,516,407
Srihari Madhava Rao B.E 13/03/2000 Director Robert Bosch India Ltd. 14 36 4,261,414
Srinath Ramamurthy Siddal B.E 29/09/2000 General Manager ABB Ltd 17 39 3,302,746
Srinivas Gutta B.E 15/11/2004 Sr. Director- Research Datamat Systems Research 11 38 9,211,016
Srinivas Rao K B.E 24/08/1999 Sr. Software Architect Tata Elxsi Ltd. 13 36 2,603,386
Srinivas Y C B.E 10/08/1998 Sr. Manager - Hardware Philips Electronics Singapore Pte Ltd 16 42 3,363,366
Srinivasan Balakrishnan Ph.D 26/09/2005 Principal Scientist - A Royal Philips Electronics NV., Netherlands 10 42 3,385,460
Srividhya Easwaran B.E 03/07/2002 Technology Specialist Tata Elxsi Ltd. 15 40 2,488,854
Sudeep R Prasad B.E 19/03/2001 System Architect SOFTWARE DEVSPCNL 12 34 2,424,052
Sudeshna Mukhopadhyay BEE,MMS 25/06/1990 General Manager - 18 43 2,507,561
Sundar Raman G B.E 03/04/2001 Sr. Project Manager SYSTEMS AIDS 18 43 2,750,229
Sunderrajan J B.E - Electronics 19/01/2000 Director Sales Agilent Technologis 30 53 4,414,597
Surendra K Dhansoia B.Sc.,M.Sc., 02/06/1997 Systems Architect LRDE 15 38 3,746,832
Suresha K B.E 23/08/1999 Sr. Project Manager Robert Bosch India Ltd 18 42 2,607,287
Sureshkumar K N B.Tech 16/11/2000 Sr. Software Architect Robert Bosch India Limited 15 38 2,509,710
Tridibkumar Das CA, CWA, B.Com 03/06/1996 Director - Corporate Control & Treasury Castrol India Limited 24 50 3,741,491
V K Gupta B.Tech (Mech), PGDBM 23/07/1971 Director - Lighting Electronics - 37 57 4,891,785
Venkata Sheshan R B.E 03/07/2006 Sr. Director - New Business Development CMAC Centum Electronics Ltd 24 46 4,789,457
Venkatakrishnan S B.E. 16/04/1997 Sr. Technology Specialist Baehal Ltd 13 33 3,131,459

20
STATEMENT OF PARTICULARS OF EMPLOYEES AS REQUIRED UNDER SECTION 217 (2a ) OF THE COMPANIES THE COMPANIES ACT, 1956
JANUARY - DECEMBER 2007
Name Qualification Date of Designation Previous Employer Experi- Age Remune-
Joining ence ration
Gross

Venkatesh H S B.E 29/09/2000 Program Manager ABB Ltd 19 43 3,045,096

Vidyashankar J B.Sc 02/01/2007 General Manager - RAISE-PBAS Lottus Development Corporation 16 37 2,536,640
Vijayananda J B.E 19/01/1998 System Architect Siemens Communications 11 33 2,981,010
Vikas Jain B.Tech 02/11/1998 Sr. Software Architect Network Programs 13 36 2,702,649
Vineet Kaul B.A (Hons), MSW 09/03/1995 Executive Director & Vice President - HR Eicher Motors Ltd 32 52 10,097,899
Vinod R S B.E 08/07/1999 Sr. Software Architect GPS Usha Pvt. Ltd. 12 36 2,425,417
Viswanathan Seshan B.Tech, Ph.D 06/10/2003 Country Manager - IP&S John F. Welch Technology Centre 12 42 2,985,661
For part of the year:
A L Alagappan BBM, MBA 01/12/2007 Director Philips Electronics International 10 34 1,093,080
B.V. Netherlands
Abhinav Kaul B.E 02/05/2005 Sr. Manager - PGP Bennet & Coleman Co Ltd 14 38 418,169
Ajay Maggo B.Com, C.A, 16/07/2007 Director General Cables 17 41 1,746,865
Alak S Basu B.Sc, B.Tech 30/06/1986 General Manager - LBU Lighting - 21 48 1,439,941
Amit Malik B.Sc, MBA 13/06/2000 General Manager BPL Limited 14 39 812,634
Arockia Durairaj MCA 10/12/2007 Senior Technical Specialist Time Tech Systems 9 32 221,310
Arun Gupta PG Dip in Software 01/02/2006 Director- Corporate PG IS Pfizer Limited 17 45 1,307,390
Tech & Sys Mgmt
Ashok N Panwalkar B.E 14/01/1980 Director-Philips Design Innova Eng Pvt Ltd 31 58 2,558,995
Ashok Nambissan B.L., BGL, Dip PM 28/06/1999 Senior Director - Legal & Secretarial and ICI India Ltd 26 51 5,349,787
General Counsel
Balaji V V B.E., 14/07/1997 Program Manager Tata Elxsi Ltd. 18 43 983,055
Bhargavi Narayan Upadhya B.E 30/08/1996 Sr. Software Architect - 12 33 627,341
J W Vincent PG Accounting & IT 01/08/2006 Director-Projects Royal Philips Electronics NV., Netherlands 39 60 4,318,897
Jaideep E K B.Tech 01/10/1999 Black Belt Self Employed 15 44 2,331,053
K Ramachandran B.E (Hons) 17/05/1993 Vice-Chairman & Managing Director Voltas Ltd 29 59 20,361,915
MBA - IIM (Kolkata)
Kalavathi G V B.E 05/02/2007 General Manager - 15 39 3,632,238
Krishna Dass S B.E 20/12/2000 Sr. Software Architect Robert Bosch India Limited 7 39 534,421
Madhav D Bapat B.E 29/01/2001 Director - PGP Mirc Electronics Ltd 24 46 2,105,390
Mahesh C Tahilyani B.Com, CA, CS, 17/09/2001 Sr.Director - Shared Service Centre Philips Consumer Electronics BV 22 43 3,466,586
Mgmt Accountant U.K
Manish Kumar B.Sc,M.Sc,PGDPM&IR 01/06/1995 Director Steel Authority of India Ltd 14 40 1,225,901
Matthijs MS. 02/08/2004 Project Manager Royal Philips Electronics NV., Netherlands 19 44 5,657,200
Murali Sivaraman ICWA,CA,PGDBM 02/07/2007 Vice-Chairman & Managing Director ICI,UK 21 47 13,765,413
N Hariharan M.Tech 02/08/2004 Director GE Capital 15 39 2,060,301
Naveen Kulkarni B.Sc 26/11/2007 Director - Business Development Sysarris Inc. 9 34 539,976
Nikhil V Madgavkar CA, LLB, B.Com 05/09/1988 Sr. Director - CE Finance - 19 44 1,393,707
Prashant V Agarwal B.E 05/06/2000 Software Architect - 11 31 1,223,499
Preethi C N B.E 13/03/2000 Sr. Technical Leader - 8 30 786,319
Priya Murali B.Com, CA 01/06/1995 General Manager Tata Libert Ltd 17 42 642,287
Pushpinder Singh Gujral BE, MMS 03/06/1996 General Manager CEESOFT systems 12 37 554,937
Raghavendra K N B.Sc 22/05/1997 Sr. Software Architect - 14 37 1,890,263
Raj Murali S B.Tech, DIPLOMA 01/09/1997 General Manager Ramco Systems 20 43 1,570,236
Rajagopalan K R B.E 20/04/2000 Director Philips Electronics UK Ltd 21 44 1,584,968
Rajeev Chopra B.Tech, MBA 14/04/2003 Senior Director - BG Luminaires Cisco Systems 22 45 4,113,670
Ramakrishna Momidi DIPLOMA 01/06/2001 General Manager - HR Honey Well India Software 20 41 1,435,137
Raman R V B.E 11/12/2000 Sr. Project Manager Grass Root Systems 7 39 543,453
Ramanathan Sethuraman Ph.D 01/07/2006 Sr. Customer Solutions Architect Philips Research 11 41 3,257,962
Ravi Kiran M T B.E 18/07/2007 Senior Project Manager Hewlett Packard 12 35 1,154,881
Remy Mary Alexander B.Tech 16/07/2007 Program Manager Hewlett Packard 13 36 1,151,129
S Dayal B.Tech, DBM 27/01/1972 Director Electronic & Computer (I) Ltd 36 59 913,325
Sanjay Nagpal B.Sc 18/07/2007 General Manager Bharati Cellular Ltd 10 39 1,445,007
Saravanan N B.E 01/07/1997 TIM Manager - 11 34 1,941,029
Satish Prasad Rath MBBS 05/07/2005 Research Scientist Govt. of Orissa 10 33 1,626,480
Shyam Sankar G B.Tech 20/03/2000 Technology Manager Digital India 18 40 655,939
Siddharth S Satpute B.Com, CA 28/04/1997 Director - 9 33 2,166,264
Srinath Mukherjee B.Com, CA 01/10/1992 Director Lovelock & Lewes 19 42 1,272,581
Srinivasan R B.E 22/06/2000 Sr. Manager-Information Systems Genesys Integrating Systems 20 47 2,263,140
Srividhya S B.E 12/06/2000 Sr. Software Architect HCL Infosystems 15 39 1,759,847
Thanuj Kambil B.Tech 09/04/2001 Sr. Software Architect Vikram Sarabhai Space Centre 14 41 1,238,088
Uma Satya Ranjan Ph.D 24/10/2007 Sr. Architect DaimlerChrysler Research R&T India 9 39 631,013
Venkatasubramanian N B.Sc, M.Sc 03/07/1996 Sr. Software Architect - 12 36 1,007,982
Venkatesan R B.E 05/08/1996 Sr. Software Architect - 12 34 1,495,921
Vinay Shenoy B.E., M.Tech 01/08/1996 Sr. Director - PSW,IP&S,IT Texas Instruments 17 41 3,859,237

NOTES :
1. All appointments are / were contractual and terminable by notice on either side.
2. Remuneration includes salary, allowances, commission, stock option costs, taxable value of perquisites, company’s contribution to provident fund, pension fund and prior year adjustment
wherever applicable. Remuneration excludes gratuity, leave encashment and payments made under voluntary retirement schemes.
3. None of the above employees is related to any director of the company.

Annual
Report 2007 21
 PHILIPS ELECTRONICS INDIA LIMITED

Auditors’ Report to the Members of Philips Electronics India Limited

We have audited the attached Balance Sheet of Philips Electronics India Limited (‘the Company’) as at 31 December
2007, and also the Profit and Loss Account and the Cash flow statement for the year ended on that date annexed
thereto. These financial statements are the responsibility of the Company’s management. Our responsibility is to
express an opinion on these financial statements based on our audit.
We conducted our audit in accordance with the auditing standards generally accepted in India. Those Standards
require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial statement presentation. We believe that
our audit provides a reasonable basis for our opinion.
As required by the Companies (Auditor’s Report) Order, 2003 (‘the Order’) issued by the Central Government of
India in terms of sub-section (4A) of Section 227 of the Companies Act, 1956 (‘the Act’), we enclose in the
Annexure, a statement on the matters specified in paragraphs 4 and 5 of the said Order.
Further to our comments in the Annexure referred to in the paragraph above, we report that:
(a) we have obtained all the information and explanations which to the best of our knowledge and belief were
necessary for the purposes of our audit;
(b) in our opinion, proper books of account as required by law have been kept by the Company so far as
appears from our examination of those books;
(c) the Balance Sheet, Profit and Loss Account and Cash Flow Statement dealt with by this report are in
agreement with the books of account;
(d) in our opinion, the Balance Sheet, Profit and Loss Account and Cash Flow Statement dealt with by this
report comply with the Accounting Standards referred to in sub-section (3C) of Section 211 of the
Companies Act, 1956;
(e) on the basis of written representations received from the directors of the Company as at 31 December
2007 and taken on record by the Board of Directors, we report that none of the directors is disqualified
as at 31 December 2007 from being appointed as a director of the Company under clause (g) of sub-
section (1) of Section 274 of the Companies Act, 1956; and
(f) in our opinion, and to the best of our information and according to the explanations given to us, the said
accounts give the information required by the Companies Act, 1956, in the manner so required and give a
true and fair view in conformity with the accounting principles generally accepted in India:
(i) in the case of the Balance Sheet, of the state of affairs of the Company as at 31 December 2007;
(ii) in the case of the Profit and Loss Account, of the profit for the year ended on that date; and
(iii) in the case of the Cash Flow Statement, of the cash flows for the year ended on that date.
For BSR & Co.
Chartered Accountants

Vijay Mathur
New Delhi Partner
11 March 2008 Membership No: 046476

22
Annexure to the Auditors’ Report

With reference to the Annexure referred to in the Auditors’ report to the Members of Philips Electronics India
Limited (‘the Company’) on the financial statements for the year ended 31 December 2007, we report the
following:
1. (a) The Company has maintained proper records showing full particulars, including quantitative details and
situation of fixed assets.
(b) We are informed that the Company physically verifies its assets over a three year period, except for
certain assets which are verified on the basis of third party confirmations. In our opinion, this periodicity of
physical verification is reasonable having regard to the size of the Company and the nature of its assets. In
accordance with this policy, the Company has physically verified certain fixed assets during the year and we
are informed that no material discrepancies were identified on such verification.
(c) Fixed assets disposed off during the year were not substantial and therefore do not affect the going
concern assumption.
2. (a) The inventory, excluding materials in transit, has been physically verified by management during the current
year. Material inventories with third parties have either been physically verified by management or confirmed
based on certificates/statements of account received from such third parties. In our opinion, the frequency
of such verification is reasonable.
(b) The procedures for the physical verification of inventories followed by management are reasonable and
adequate in relation to the size of the Company and the nature of its business.
(c) The Company is maintaining proper records of inventory. Discrepancies identified on physical verification
of inventories as compared to book records were not material and have been properly dealt with in the
books of account.
3. The Company has neither granted nor taken any loans, secured or unsecured, to or from companies, firms or
other parties covered in the register maintained under Section 301 of the Companies Act, 1956.
4. In our opinion, and according to the information and explanations given to us, there is an adequate internal
control system commensurate with the size of the Company and nature of its business with regard to the
purchase of inventories and fixed assets and with regard to the sale of goods and services. In our opinion, and
according to the information and explanations given to us, there is no continuing failure to correct major
weaknesses in the internal control system.
5. (a) In our opinion and according to the information and explanations given to us, the particulars of contracts or
arrangements referred to in Section 301 of the Companies Act, 1956 have been entered in the register
required to be maintained under that section.
(b) In our opinion, and according to the information and explanations given to us, the transactions made in
pursuance of contracts and arrangements referred to in (a) above and exceeding the value of Rs 5 lakh
with any party during the year have been made at prices which are reasonable having regard to the
prevailing market prices at the relevant time.
6. In our opinion, and according to the information and explanations given to us, the Company has complied with
the provisions of Section 58A, Section 58AA or other relevant provisions of the Companies Act, 1956 and the
rules framed thereunder/the directives issued by the Reserve Bank of India (as applicable) with regard to
deposits accepted from the public. Accordingly, there have been no proceedings before the Company Law
Board or National Company Law Tribunal (as applicable) or Reserve Bank of India or any Court or any other
Tribunal in this matter and no order has been passed by any of the aforesaid authorities.
7. In our opinion, the Company has an internal audit system commensurate with its size and the nature of its
business.
8. We have broadly reviewed the books of account maintained by the Company pursuant to the rules prescribed
by the Central Government for maintenance of cost records under Section 209(1)(d) of the Companies Act,

Annual
Report 2007 23
 PHILIPS ELECTRONICS INDIA LIMITED

Annexure to the Auditors’ Report (Continued)

1956 in respect of Electric Lamps and Fluorescent Tubes and are of the opinion that prima facie, the prescribed
accounts and records have been made and maintained. However, we have not made a detailed examination of
the records.
9. (a) According to the information and explanations given to us and on the basis of our examination of the
records of the Company, amounts deducted/accrued in the books of account in respect of undisputed
statutory dues including Provident Fund, Investor Education and Protection Fund, Employees’ State Insurance,
Wealth tax, Excise Duty, Service Tax, Customs Duty and other material statutory dues have generally been
regularly deposited during the year by the Company with the appropriate authorities, though there have
been slight delays in depositing dues relating to Sales tax and Income tax. There were no dues on account
of cess under Section 441A of the Companies Act, 1956 since the date from which the aforesaid section
comes into force has not yet been notified by the Central Government. According to the information and
explanations given to us, no undisputed amounts payable in respect of Provident Fund, Investor Education
and Protection Fund, Employees’ State Insurance, Wealth tax, Excise Duty, Income Tax, Service Tax,
Customs Duty, Sales tax and other material statutory dues were in arrears as at 31 December 2007 for a
period of more than six months from the date they became payable.
(b) According to the information and explanations given to us, there are no dues of Wealth tax, Service tax
and Customs duty which have not been deposited on account of any dispute. The dues of Income tax,
Sales tax and Excise duty as disclosed in Appendix 1 have not been deposited by the Company on
account of disputes. There were no dues on account of cess under Section 441A of the Companies Act,
1956 since the date from which the aforesaid section comes into force has not yet been notified by the
Central Government.
10. The Company does not have any accumulated losses at the end of the financial year and has not incurred cash
losses in the financial year and in the immediately preceding financial year.
11. In our opinion and according to the information and explanations given to us, the Company has not defaulted
in repayment of dues to its bankers or to any financial institutions. The Company did not have any outstanding
debentures during the year.
12. According to the information and explanations given to us, the Company has not granted loans and advances
on the basis of security by way of pledge of shares, debentures and other securities.
13. In our opinion and according to the information and explanations given to us, the Company is not a chit fund/
nidhi/mutual benefit fund/society.
14. According to the information and explanations given to us, the Company is not dealing or trading in shares,
securities, debentures and other investments.
15. According to the information and explanations given to us, the Company has not given any guarantee for loans
taken by others from banks or financial institutions.
16. In our opinion and according to the information and explanations given to us, the term loan taken by the
Company has been applied for the purpose for which it was raised.
17. According to the information and explanations given to us and on an overall examination of the Balance Sheet
of the Company, we are of the opinion that the funds raised on short-term basis have not been used for long-
term investment.
18. The Company has not made any preferential allotment of shares to companies/ firms/ parties covered in the
register maintained under Section 301 of the Companies Act, 1956.
19. The Company did not have outstanding debentures during the year.
20. The Company has not raised any money by public issues during the year.

24
Annexure to the Auditors’ Report (Continued)

21. According to the information and explanations given to us, no fraud on or by the Company, that causes a
material misstatement to the financial statements, has been noticed or reported during the course of our audit.

For BSR & Co.

Chartered Accountants

Vijay Mathur
New Delhi Partner
11 March 2008 Membership No: 046476

Appendix 1 to Annexure to the Auditors’ Report (Rs in Mln)

Forum where dispute is pending
Name of Statute/ Appellate
Period to which Nature of dues authority upto
the amount Commissioner
relates (Appeals) Tribunal High Court
Central Excise Act, 1944
2006-07 Excise duty — — —
including interest
2005-06 — 31.5 —
and penalty
3-7 years where 33.0 9.9 2.6
applicable
Above 7 years — 191.7 5.0
Central Sales Tax Act, 1956
and Individual State Sales Tax Act

2006-07 — — 2.2
Sales tax
2005-06 Including interest — — 41.8

3-7 years and penalty 74.4 42.3 —

where
Above 7 years applicable 21.0 219.4 12.4

Income Tax Act, 1961

2006-07 Income tax — — —

2005-06 including interest — — —

and penalty
3-7 years where 93.0 — —
applicable
Above 7 years — — —

Annual
Report 2007 25
 PHILIPS ELECTRONICS INDIA LIMITED

Profit and Loss Account for the year ended December 31, 2007

Amounts in Rs. Mln

Notes Year ended Year ended

December 31, 2007 December 31, 2006
INCOME
Sales and income from operations (gross) 1 28,986 26,603
Less: Excise duty recovered 531 492
Sales and income from operations (net) 28,455 26,111
Other income 2 377 132
28,832 26,243
EXPENDITURE
Material cost 3 16,770 14,308
Expenses 4 9,017 9,826
Interest 6 51 45
Depreciation / Amortisation 538 603
26,376 24,782
Transfer to assets — 23
Transfer from capital reserve - revaluation 7 1
26,376 24,758
OPERATING PROFIT 2,456 1,485
Employees’ voluntary retirement scheme (2) (79)
Other exceptional items 14 440 1,623
PROFIT BEFORE TAX 2,894 3,029
Fringe benefit tax 19 (38) (61)
Provision for current tax 19 (939) (824)
Provision for deferred tax 19 (14) (14)
PROFIT AFTER TAX 1,903 2,130
Balance brought forward 150 150
Available for appropriation 2,053 2,280
Transfer to general reserve 190 1,970
Proposed equity dividend 140 140
Tax on proposed equity dividend 28 20
Balance carried forward 1,695 2,053 150 2,280
Basic and diluted earnings per equity share of
Rs.10 each (in Rs.) 17
— Before exceptional items 21.65 13.44
— After exceptional items 27.08 30.32

The statement of accounting policies and notes 1-20 to the profit and loss account form an integral part of the accounts.

In terms of our report of even date For and on behalf of the Board

For BSR & Co. Chairman S.M.DATTA

Chartered Accountants
Managing Director MURALI SIVARAMAN

VIJAY MATHUR Director C.J.M.REUVERS

Partner
New Delhi, March 11, 2008 Membership No. 046476 Secretary R.J.WANI

26
Balance Sheet as at December 31, 2007

Amounts in Rs. Mln

Notes As at December 31, 2007 As at December 31, 2006

SOURCES OF FUNDS
Shareholders’ funds
Capital 1 703 703
Reserves and surplus 2 8,709 6,974
9,412 7,677
Loan funds
Secured loans 3 103 70
Unsecured loans 4 36 38
139 108

9,551 7,785

APPLICATION OF FUNDS
Fixed assets 5
Gross block 6,800 6,641
Less: Depreciation 4,210 4,346
Net block 2,590 2,295
Capital work-in-progress 104 2,694 366 2,661
Investments 6 16 11
Deferred tax assets - net 7 240 254
Current assets, loans and advances
Inventories 8 2,255 1,902
Sundry debtors 9 3,120 2,687
Cash and bank balances 10 6,747 5,178
Loans and advances 11 1,430 1,399
13,552 11,166

Less : Current liabilities and provisions

Liabilities 12 5,790 4,879
Provisions 13 1,161 1,428
6,951 6,307
Net current assets 6,601 4,859
9,551 7,785

The statement of accounting policies and notes 1-16 to the balance sheet form an integral part of the accounts.

In terms of our report of even date For and on behalf of the Board

For BSR & Co. Chairman S.M.DATTA

Chartered Accountants
Managing Director MURALI SIVARAMAN

VIJAY MATHUR Director C.J.M.REUVERS

Partner
New Delhi, March 11, 2008 Membership No. 046476 Secretary R.J.WANI

Annual
Report 2007 27
 PHILIPS ELECTRONICS INDIA LIMITED

STATEMENT OF ACCOUNTING POLICIES

1. BASIS OF PREPARATION OF FINANCIAL STATEMENTS
The financial statements are prepared and presented under historical cost convention, with the exception of land
and buildings, which have been revalued, on the accrual basis of accounting in accordance with the generally
accepted accounting principles followed in India (‘Indian GAAP’) and the relevant provisions of the Companies
Act, 1956 and comply with the accounting standards prescribed in Companies (Accounting Standards) Rules,
2006, issued by the Central Government in consultation with the National Advisory Committee on Accounting
Standards, to the extent applicable.
2. REVENUE RECOGNITION
Sales are recorded net of trade discounts, rebates, sales tax but include excise duty.
Sales of goods / equipments are recognized on transfer of risks and rewards of ownership in the goods to the
customers / completion of installation.
Income from annual maintenance service contracts is recognized on a straight-line basis over the period of
contracts and income from other service contracts is recognized on completion of the service rendered.
Revenues from software development and accounting services are billed to clients on cost plus basis as per the
terms of the specific contracts and are recognized based on software developed and accounting services
rendered. Cost and earnings in excess of billings are classified as unbilled revenue.
3. FIXED ASSETS AND DEPRECIATION
Fixed assets other than land, leaseholds and buildings, are valued at cost. Land, leaseholds and buildings were revalued
in the year 1982 and 1985 by an approved valuer and now appear at carrying values based on such valuation.
Depreciation is provided on the original cost on a straight line method at the rates given in Schedule XIV of the
Companies Act, 1956, (as amended vide notification GSR 756 [E] dated 16.12.1993) except in case of jigs and
fixtures, CE-test and measuring instruments, CE-assembly equipment, machineries for certain electronic components,
soda lime glass furnace, press tools and moulds, furniture and fittings, room air conditioners, office machinery,
computers, cars and feeder line for which higher depreciation at the rates of 11.5%, 15%, 15%-20%, 7%-41.39%,
22.22%-24.0%, 20%-40%, 7%-30.8%, 7%-14%, 7%-34.7%, 20%-50%, 12%-45%, 20% respectively, is provided.
Life class of the assets acquired on amalgamation, are aligned to those followed by the company and accordingly
rates are adjusted except for few assets acquired from erstwhile PSCL, which are charged over and above the
rates followed by the Company; these are in respect of lease hold improvements 20%, plant and machinery,
furniture & fixtures, vehicles & software 33.33%. Application software is charged to revenue and assets costing
less than Rs.5000 are fully depreciated in the year of purchase. Assets given on hire by erstwhile PMSIL are
depreciated over a period of three years, which is the useful life of the asset estimated by the management.
Assets acquired under finance lease from April 1, 2001 are capitalised at the lower of their fair value and the
present value of the minimum lease payments. Assets obtained on finance lease are depreciated over the lease
period.
In respect of land, leaseholds and buildings, the difference between depreciation calculated on straight-line
method on the revalued amount at the rates indicated by the valuer, and that calculated on the original cost as
per Schedule XIV rates, is recouped from “Capital Reserve-Revaluation”.
4. IMPAIRMENT OF ASSETS
The Company assesses at each balance sheet date whether there is any indication that an asset may be impaired.
If any such indication exists, the Company estimates the recoverable amount (higher of net realizable value and
value in use) of the asset. If such recoverable amount of the asset or the recoverable amount of the cash
generating unit to which the asset belongs is less than the carrying amount, the carrying amount is reduced to its
recoverable amount. The reduction is treated as an impairment loss and is recognized in the profit and loss
account. If at the balance sheet date there is an indication that a previously assessed impairment loss no longer
exists, the recoverable amount is reassessed and the asset is reflected at the recoverable amount subject to a
maximum of depreciable historical cost.
5. INVENTORIES
Inventories are valued at cost or net realisable value whichever is lower. In case of medical equipments/systems,
cost is determined on the basis of “First in First Out” method due to nature of the business. For all other items

28
 cost is determined on the basis of the weighted average method and includes all costs incurred in bringing the
inventories to their present location and condition. Finished goods and Work-in-Progress include appropriate
proportion of costs of conversion. Obsolete, defective and unserviceable stocks are duly provided for.
6. INVESTMENTS
Long-term investments are stated at cost less any permanent diminution in value.
7. FOREIGN CURRENCY TRANSACTIONS
Foreign currency transactions are recorded in the books of the Company at standard exchange rates fixed every
month on the basis of a review of the actual exchange rates. The difference between the actual rate of
settlement and the standard rate is charged or credited to profit and loss account.
In respect of current assets and current / long-term liabilities, the overall net loss or gain, if any, on conversion at
the exchange rates prevailing on the date of the balance sheet is charged to revenue.
The premium or discount arising at the inception of forward exhange contracts, which are not intended for
trading or speculation purposes, are amortised as expense or income over the life of the contract. Exchange
differences on such contracts are recognised in the statement of profit and loss in the reporting period in which
the exchange rates change. Any profit or loss arising on cancellation or renewal of such forward exchange
contracts is recognised as income or as expense for the period.
8. REPLACEMENT GUARANTEE
The Company periodically assesses and provides for the estimated liability on guarantees given on sale of its
products based on past performance of such products.
9. RESEARCH & DEVELOPMENT
Revenue expenditure is charged to the profit and loss account in the year in which it is incurred and expenditure
of a capital nature is capitalised as fixed assets.
10. RETIREMENT BENEFITS
Liability for defined benefit plan is provided on the basis of actuarial valuation. Company’s contributions to
defined contribution plans are charged to Profit and Loss account as incurred. Termination benefits are recognized
as and when incurred.
11. PROVISIONS AND CONTINGENCIES
A provision is recognized when:
• The Company has a present obligation as a result of a past event;
• It is probable that an outflow of resources embodying economic benefits will be required to settle the
obligation; and
• A reliable estimate can be made of the amount of the obligation.
A disclosure for a contingent liability is made when there is possible obligation or a present obligation that may,
but probably will not, require outflow of resources. Where there is a possible obligation or a present obligation
that the likelihood of outflow of resources is remote, no provision or disclosure is made.
12. TAXATION
Income-tax expense comprises current tax and deferred tax charge or release. The deferred tax charge or credit
is recognised using current tax rates. Where there is unabsorbed depreciation or carry forward losses, deferred
tax assets are recognised only if there is virtual certainty of realisation of such assets. Other deferred tax assets
are recognised only to the extent there is reasonable certainty of realisation in future. Such assets are reviewed
as at each Balance Sheet date to reassess realisation.
For and on behalf of the Board

Chairman S.M.DATTA
Managing Director MURALI SIVARAMAN
Director C.J.M.REUVERS

New Delhi, March 11, 2008 Secretary R.J.WANI

Annual
Report 2007 29
 PHILIPS ELECTRONICS INDIA LIMITED

Notes to Profit and Loss Account

Amounts in Rs. Mln
1. SALES AND INCOME FROM OPERATIONS
Year ended Year ended
Sales of goods / services (gross) December 31, 2007 December 31, 2006
Unit Quantity Rs. Quantity Rs.

Lamps pcs in ‘000 359,386 7,480 339,281 6,567

Television receivers pcs in ‘000 406 3,071 385 2,464

Radio sets, tape recorders, compact / digital video pcs in ‘000 2,923 4,593 2,469 3,542

disc players / systems / combination sets

Software development services 2,395 3,782

Fittings pcs in ‘000 5,997 3,411 5,073 2,862

Domestic appliances pcs in ‘000 1,880 1,780 1,436 1,300

Services 995 1,111

Monitors pcs in ‘000 — — 31 89

Mobile image intensifiers pcs 74 1,401 73 1,022

Accessories for fittings pcs in ‘000 17,428 944 17,019 889

Accessories for radio sets and tape recorders pcs in ‘000 604 274 2,115 622

Resuscitation and patient monitoring equipments pcs 5,411 670 4,382 587

Ultra sound equipments pcs 381 624 320 513

Glass shells pcs in ‘000 158,317 191 203,189 207

Electronic HF ballasts pcs in ‘000 1,690 421 1,261 218

Operation theatre lights pcs 1,764 75 1,501 62

Others 581 649

28,906 26,486

Income from operations

Liabilities no longer required written back 18 50
Export incentives 6 10
Hire charges of tools 10 8
Surplus / (loss) on disposal of fixed assets - net 9 6
Insurance and other claims 6 5

Others 31 38

80 117

28,986 26,603

2. OTHER INCOME
Interest on advances, current accounts and deposits - gross
[tax deducted thereon Rs.85 (2006 - Rs.25)] 376 131
Income from other investments 1 1
377 132

30
Notes to Profit and Loss Account
Amounts in Rs. Mln

Year ended Year ended

December 31, 2007 December 31, 2006
3. MATERIAL COST
Stocks as at beginning

Raw materials and piece parts - purchased 257 463

Own manufactured components and piece parts 2 19

Finished goods 1,328 1,433

Excise duty on finished goods 28 24

Work-in-progress 93 1,708 122 2,061

Add : Purchases

Raw materials and piece parts 1,777 2,624

Finished goods 15,236 17,013 11,358 13,982

18,721 16,043

Deduct: Stock transferred on sale of business activity — 27

Deduct : Stocks as at end

Raw materials and piece parts - purchased 111 257

Own manufactured components and piece parts - 2

Finished goods 1,581 1,328

Excise duty on finished goods 30 28

Work-in-progress 229 1,951 93 1,708

16,770 14,308

Raw materials and piece parts consumed

Unit Quantity Rs. Quantity Rs.

Ferrous metals tonnes 58 1 3,254 90

Non-ferrous metals tonnes 99 15 1,702 216
Plastics tonnes 110 1 441 26
Transistors and valves pcs in ‘000 19,560 69 28,805 113
Piece parts pcs in ‘000 1,937,330 776 1,825,579 987
Chemicals, gases, paints 189 150
Packing materials 227 307
Others 466 463
1,744 2,352

Annual
Report 2007 31
 PHILIPS ELECTRONICS INDIA LIMITED

Notes to Profit and Loss Account

Amounts in Rs. Mln

Year ended Year ended

December 31, December 31,
2007 2006
Purchases Unit Quantity Rs. Quantity Rs.

Raw materials and piece parts

Ferrous metals tonnes 20 2,120 87

Non-ferrous metals tonnes 20 17 1,640 187

Plastics tonnes 45 331 37

Transistors and valves pcs in ‘000 7,698 38 22,093 94

Piece parts pcs in ‘000 1,880,243 843 1,757,305 1,289

Chemicals, gases, paints 186 160

Packing materials 226 298
Others 467 472
1,777 2,624

Finished goods
Class of goods Unit Quantity Rs. Quantity Rs.

Radio sets, tape recorders, compact / digital video

disc players / systems / combination sets pcs in ‘000 3,050 2,829 2,454 2,116

Accessories for radio sets and tape recorders pcs in ‘000 632 304 2,120 382

Television receivers pcs in ‘000 437 2,355 365 1,484

Domestic appliances pcs in ‘000 2,022 1,257 1,427 857

Lamps pcs in ‘000 53,351 2,337 46,472 1,811

Fittings pcs in ‘000 6,156 2,244 5,300 1,864

Accessories for fittings pcs in ‘000 17,465 736 13,977 432

Electronic HF ballasts pcs in ‘000 1,726 228 570 55

Monitors pcs in ‘000 — — 15 90

Resuscitation and patient monitoring equipments pcs 5,505 626 4,579 444

Mobile image intensifiers pcs 74 978 69 763

Ultra sound equipments pcs 386 487 325 413

Operation theatre lights pcs 1,755 56 1,579 43

Installations 16 34

Service consumables 363 381

Others 420 189

15,236 11,358

32
Notes to Profit and Loss Account
Amounts in Rs. Mln

Stocks as at Year ended Year ended Year ended

December 31, December 31, December 31,
2007 2006 2005

Raw materials and piece parts Unit Quantity Rs. Quantity Rs. Quantity Rs.

Ferrous metals tonnes 1 39 1 1,173 5

Non-ferrous metals tonnes 82 8 144 37

Plastics tonnes 2 66 1 184 5

Transistors and valves pcs in ‘000 729 2 12,611 33 19,323 52
Piece parts pcs in ‘000 78,900 22 155,231 123 248,251 284

Chemicals, gases, paints 30 32 22

Packing materials 5 7 16

Others 52 52 42

111 257 463

Finished goods
Class of goods Unit Quantity Rs. Quantity Rs. Quantity Rs.

Radio sets, tape recorders, compact /

digital video disc players / systems /
combination sets pcs in ‘000 281 216 206 194 236 213

Accessories for radio sets and

tape recorders pcs in ‘000 43 10 124 82 503 130

Television receivers pcs in ‘000 47 283 28 182 51 287

Domestic appliances pcs in ‘000 302 212 173 93 189 84

Lamps pcs in ‘000 16,147 372 19,480 357 13,101 294

Fittings pcs in ‘000 563 113 404 125 177 113

Accessories for fittings pcs in ‘000 1,509 70 1,058 45 941 42

Electronic HF ballasts pcs in ‘000 102 17 48 6 44 6

Monitors pcs in ‘000 — — -— — 18 61

Resuscitation and patient
monitoring equipments pcs 398 53 304 30 107 15

Mobile image intensifiers pcs 4 23 4 42 8 13

Ultra sound equipments pcs 45 38 40 45 35 33

Operation theatre lights pcs 109 6 118 5 40 5

Service consumables 140 84 65

Others 58 66 96

1,611 1,356 1,457

Annual
Report 2007 33
 PHILIPS ELECTRONICS INDIA LIMITED

Notes to Profit and Loss Account

Amounts in Rs. Mln
4. EXPENSES
Year ended Year ended
December 31, 2007 December 31, 2006
Salaries, wages, bonus and commission 2,294 2,873
Contribution to pension and provident funds 137 142
Staff welfare 204 253
Rent 333 431
Rates and taxes 170 161
Excise duty 50 110
Power and fuel 441 422
Insurance 64 63
Repairs and maintenance of buildings 59 70
Repairs and maintenance of plant and machinery 105 101
Audit fees and expenses 11 10
Travelling and conveyance 630 740
Publicity 938 757
Packing, freight and transport 346 335
Postage, stationery and office expenses 460 496
Indirect / auxilliary materials 17 14
Provision for doubtful debts and advances 65 76
Selling expenses 238 169
Management support services 1,090 882
Research and development services 289 228
Miscellaneous 1,076 1,493
9,017 9,826

(a) Remuneration to managing director and other directors as fees, salaries, commission and other emoluments including Rs.2.1 (2006 -
Rs.2.5) contribution to pension fund and release of Rs.2.1 (2006 - Rs.2.9) relating to prior year is Rs. 111 (2006 - Rs.100) of which
Rs.13 (2006 - Rs.18) requires approval of shareholders. These figures exclude gratuity and leave encashment provisions which are
actuarially determined on an overall basis.
(b) Excise duty recovered through sales is disclosed as a reduction from sales and excise duty in opening and closing stock of finished
goods is disclosed separately in Note 3 to Profit and Loss Account. The excise duty not recovered from sales is disclosed as "excise
duty" expense above.
(c) Repairs and maintenance of plant and machinery includes stores and spare parts consumed - Rs.63 (2006 - Rs.62).
(d) Audit fees and expenses include fees - Rs.5.5 (2006 - Rs.4.5), tax audit fees - Rs.2 (2006 - Rs.2), taxation matters - Rs.0.8 (2006 -
Rs.0.7), other matters - Rs.2.2 (2006 - Rs.1.9) and expenses - Rs.0.7 (2006 - Rs.1.0).
(e) Miscellaneous include consultancy - Rs.281 (2006 - Rs.343), replacement guarantee - Rs.290 (2006 - Rs.279), software - Rs.15 (2006
- Rs.217), cash discount on sales - Rs.55 (2006 - Rs.116), sales tax surcharge - Rs.7 (2006 - Rs.70), undepreciated value of fixed assets
written off / provided for - Rs.24 (2006 - Rs.18), exchange gain (net) - Rs.30 (2006 - Rs.13), lease rental towards non-cancellable
operating lease for vehicles - Rs.23 (2006 - Rs.41) and donation - Rs.8 (2006 - Rs.2).
(f) Pursuant to the agreement entered into by the Company with KPENV, the Company has incurred Rs.1,090 (2006 - Rs.882) towards
the support services provided by KPENV and Rs.289 (2006 - Rs.228) for accessing the benefit resulting from common research and
development programmes.
(g) Maximum obligations on long-term non-cancellable operating lease for office premises and vehicles are - payable within 1 year - Rs.251
(2006 - Rs.183) and payable between 1-5 years - Rs.406 (2006 - Rs.575).
5. Revenue expenditure on research and development - Rs.39 (2006 - Rs.36).
6. Interest includes interest on debentures Rs.Nil (2006 - Rs.1).
7. The difference of Rs.Nil (2006 - Rs.1) between depreciation on the “revalued amount” and the “original cost” charged to the profit and loss
account for the year has been recouped from capital reserve created by revaluation of fixed assets.

34
Notes to Profit and Loss Account Amounts in Rs. Mln
8. CAPACITY AND PRODUCTION
Class of goods Year ended Year ended
December 31, 2007 December 31, 2006
Unit Licensed Installed Produc- Licensed Installed Produc-
Capacity Capacity tion Capacity Capacity tion
Lamps pcs in ‘000 511,171 345,083 308,746 511,171 345,083 327,552
Glass shells pcs in ‘000 146,230 550,847 656,029 146,230 547,976 518,135
Filaments pcs in ‘000 750,000 450,000 472,320 750,000 450,000 433,698
Molybdenum wire kgs 12,000 12,000 1,379 12,000 12,000 119
Licensed capacity excludes permissible increases as per various Government schemes. For delicensed industries, it includes registered
capacities as per Industrial Entrepreneurs' Memoranda filed with Government where commercial production against the same has commenced.
Installed capacity is on single shift basis except for some items of electronic components, lamps and lamp components and is as certified by
management and has not been verified by the auditors, as it is a technical matter.
9. RELATED PARTY TRANSACTIONS
(a)(i) Names of the companies with whom transactions have taken place during the year
Holding Company : Koninklijke Philips Electronics N.V
Associate Company : Nil
Fellow Subsidiary Companies : As per list given below
Overseas Fellow Subsidiary Companies:
NARVA Speziallampen GmbH Philips Electronics UK Limited Philips Technologie GmbH
Philips & Yaming Lighting Co., Ltd. Philips Electronics Vietnam Limited Philips Mexicana, S.A. de C.V.
Philips (China) Investment Company Ltd. Philips Export B.V. Philips Medical Systems Export, Inc.
Philips Automotive Lighting Hubei Co., Philips France Feixin Lighting Co., Ltd.
Ltd. Philips Holding USA Inc. Philips Lighting Luminaires (Shanghai) Co., Ltd.
Philips Consumer Electronics B.V. Philips Innovative Applications Philips Electrical Industries of Pakistan Limited
Philips do Brasil Ltda. Philips International B.V. Philips Electronics Australia Limited
Philips Domestic Appliances and Personal Philips Lighting B.V. Philips Industries Hungary Electronical Mechanical
Care B.V. Philips Lighting Bielsko Sp.z.o.o. Manufacturing and Trading Limited Liability Company
PT. Philips Indonesia Philips Lighting Electronics (Shanghai) Co., Ltd. Philips New Zealand Limited
Philips Electronics (Thailand) Ltd. Philips Lighting Poland S.A. RCS - Sistemas de Controlo Remoto, S.A.
Philips Electronics and Lighting, Inc. Philips Medical Systems (Cleveland), Inc. Feidong Lighting Company, Limited
Philips Electronics Hong Kong Limited Philips Medical Systems DMC, Gmbh Philips PMF International B.V.
Philips Electronics Korea Ltd. Philips Medical Systems Nederland B.V. Philips Singapore Private Limited
Philips Electronics Ltd. Philips Medizin Systeme Böblingen GmbH Philips Luminaires (Malaysia) Sdn. Bhd.
Philips Electronics Nederland B.V. Philips Oral Healthcare, Inc. Philips and Neusoft Medical Systems Co., Ltd.
Philips Electronics North America Philips Taiwan Ltd. Philips Electronique Maroc
Corporation Philips Medizinische Systeme GMBH
Philips Ultrasound, Inc.
Philips Electronics Singapore Pte Ltd Philips Medical Systems Tech Limited
P.T. Philips Indonesia
Philips Electronics Trading & Services
(Shanghai) Co. Ltd. Turk Philips Ticaret Anonim Sirketi
(ii) Names of the Employee Trusts with whom transactions have taken place during the year:
Philips Electronics India Ltd. Managment Staff Provident Fund Trust
Philips India Ltd. Superannuation Fund
Year ended December 31, 2007 Year ended December 31, 2006
Fellow Fellow
(b) NATURE OF TRANSACTIONS Holding Associate Subsidiary Employee Holding Associate Subsidiary Employee
Company Company Companies Trusts Company Company Companies Trusts
PURCHASES
Goods — — 5,530 — — 38 4,369 —
Fixed assets — — 22 — — — 16 —
Services 1,254 — 478 — 1,013 — 502 —
SALES
Goods — — 62 — — — 110 —
Services 67 — 2,750 — 2,049 — 2,387 —
DEPUTATION OF PERSONNEL
Charge — — 3 — — — 1 —
Recovery — — 30 — — — 15 —
FINANCE
Dividend paid 136 — — — 102 — — —
Interest paid — — 1 — — — 2 —
Contributions to Employees’
Benefit Plans — — — 102 — — — 100
Advances given — — — 15 — — — 30
OUTSTANDINGS
Payable 127 — 672 — 90 3 484 —
Receivable 6 — 324 45 61 — 649 30

Annual
Report 2007 35
 PHILIPS ELECTRONICS INDIA LIMITED

Notes to Profit and Loss Account Amount in Rs. Mln

Relationship / Name of the related party Description of the Value of the transactions
nature of transaction 2007 * 2006*
Fellow subsidiary Companies:
Philips & Yaming Lighting Co Ltd Purchase of goods 786 695
Philips Electronics Singapore Pte Ltd Purchase of goods 1,318 722
Philips Electronics Hongkong Limited Purchase of goods 2,033 1,832
Philips Electronics (Thailand) Ltd Purchase of fixed assets 4 6
Philips Electronics Singapore Pte Ltd Purchase of fixed assets 3 —
Philips Lighting B.V Purchase of fixed assets 14 9
Philips Holding USA Inc Purchase of services 61 —
Philips International B.V Purchase of services 299 306
Philips Semiconductors B.V Purchase of services — 96
Philips Electronics Singapore Pte Ltd Sale of goods 36 85
Philips Exports BV Sale of goods 13 14
Philips International B.V Sale of services 2,431 916
Philips Semiconductors B.V Sale of services — 939
Philips Electronics Nederland B.V Deputation charge 3 1
Philips Electronics Hongkong Limited Deputation recovery — 3
Philips Electronics Nederland B.V Deputation recovery 3 —
Philips Electronics North America Corporation Deputation recovery 10 5
Philips International B.V Deputation recovery 8 —
Avent Limited Deputation recovery — 2
Philips & Yaming Lighting Co Ltd Payable 82 54
Philips Lighting B.V Payable 107 —
Philips Electronics Hongkong Limited Payable 261 107
Philips International B.V Payable 105 104
Philips Electronics Singapore Pte Ltd Payable 95 —
Philips Medical System Nederland B V Payable 124 79
Philips Medical Systems Tech Ltd Payable 93 —
Philips Medizin Systeme Boblingen Gmbh Payable — 50
Philips Ultrasound, Inc Payable — 55
Philips Electronics Hongkong Limited Receivable 56 —
Philips International B.V Receivable 218 467
Philips Ultrasound Inc Interest paid 1 2
* represents transactions with parties which comprise more than 10% of aggregate value of transactions.
(c) Names of the Directors of the Company with whom transactions have taken place during the year
Whole-time Directors Mr.Murali Sivaraman *
Mr.K.Ramachandran **
Mr.V.Kaul
Mr.Coen J.M.Reuvers
Mr.S.Venkataramani
Mr.Alexius Collette
Non-executive Directors Mr.S.M.Datta
Mr.Andreas Wente ***
Mr.Rajiv Bakshi ****
Mr.Adrianus Schevers *****
(1) Details of remuneration to directors are disclosed under note 4 (a) to Profit and Loss Account.
(2) Amounts due from directors - Rs.Nil (2006 - Rs.0.4) and interest recovered thereon - Rs.0.03 (2006 - Rs.0.03) have been included
under Note 11 to Balance Sheet and Note 2 to Profit and Loss Account respectively.
* Executive Director w.e.f. July 2, 2007
** Ceased to be Executive Director w.e.f. October 3, 2007
*** Ceased to be Non-Executive Director w.e.f. Februray 7, 2007
**** Ceased to be Non-Executive Director w.e.f. April 19, 2007
***** Non-Executive Director w.e.f. April 20, 2007

36
Notes to Profit and Loss Account
Amounts in Rs. Mln

10. INFORMATION ABOUT BUSINESS SEGMENTS

Description Year Ended Year Ended Description Year Ended Year Ended
Dec 31, 2007 Dec 31, 2006 Dec 31, 2007 Dec 31, 2006
(A) PRIMARY SEGMENT INFORMATION: OTHER INFORMATION
(1) SEGMENT REVENUE (11) SEGMENT ASSETS
a. Lighting 12,127 10,510 a. Lighting 4,408 3,992
b. Consumer Electronics 8,365 6,981 b. Consumer Electronics 2,259 2,014
c. Software development services 2,407 3,775 c. Software development services 860 1,689
d. Medical Systems 3,430 2,830 d. Medical Systems 1,825 1,318
e. Other segments 2,050 1,920 e. Other segments 578 395
TOTAL 28,379 26,016 f. Other unallocable 6,237 4,430
(2) INTER SEGMENT REVENUE TOTAL 16,167 13,838
a. Lighting — 15
b. Consumer Electronics — — (12) SEGMENT LIABILITIES
c. Software development services — — a. Lighting 2,525 2,118
d. Medical Systems — — b. Consumer Electronics 1,569 1,484
e. Other segments — 344 c. Software development services 450 617
TOTAL — 359 d. Medical Systems 1,127 782
e. Other segments 391 377
(3) Other unallocable income 76 95
f. Other unallocable 889 726
NET SALES AND INCOME FROM
OPERATIONS (1+3) 28,455 26,111 TOTAL 6,951 6,104

(13) CAPITAL EXPENDITURE

(4) SEGMENT RESULT
a. Lighting 306 159
a. Lighting 1,698 1,396
b. Consumer Electronics 28 23
b. Consumer Electronics 528 (205)
c. Software development services 507 147
c. Software development services 287 344
d. Medical Systems 18 12
d. Medical Systems 259 17
e. Other segments 59 23
e. Other segments 119 210
f. Other unallocable 75 53
TOTAL 2,891 1,762
TOTAL 993 417
(5) Interest (51) (45)
(14) DEPRECIATION
(6) Other unallocable expenditure (384) (232)
net of income a. Lighting (238) (242)
b. Consumer Electronics (17) (24)
(7) OPERATING PROFIT (4+5+6) 2,456 1,485
c. Software development services (178) (274)
(8) Exceptional items d. Medical Systems (9) (7)
a. Lighting 44 (67) e. Other segments (21) (18)
b. Consumer Electronics — (2) f. Other unallocable (75) (38)

c. Software development services — — TOTAL (538) (603)

d. Medical Systems — —
e. Other segments — (3) (15) Non-cash expenses other than depreciation
f. Other unallocable 394 1,616 a. Lighting (18) (17)

TOTAL 438 1,544 b. Consumer Electronics (29) (27)

c. Software development services (20) (10)
(9) PROFIT BEFORE TAX 2,894 3,029 d. Medical Systems (25) (42)
(1) Fringe benefit tax (38) (61) e. Other segments (4) (1)
(2) Provision for tax (939) (824) f. Other unallocable (2) (10)
(3) Provision for deferred tax (14) (14)
TOTAL (98) (107)
(10) PROFIT AFTER TAX 1,903 2,130

(B) SECONDARY SEGMENT INFORMATION: Assets

a. Within India 15,840 13,170
Revenue
b. Outside India 327 668
a. Within India 25,357 21,391
b. Outside India 3,098 4,720 TOTAL 16,167 13,838
Capital Expenditure
TOTAL 28,455 26,111
a. Within India 993 417
b. Outside India — —

TOTAL 993 417

The secondary segment revenue and assets in the geographical segments considered for disclosure are as follows:
(1) Revenue and assets within India.
(2) Revenue and assets outside India.

Annual
Report 2007 37
 PHILIPS ELECTRONICS INDIA LIMITED

Notes to Profit and Loss Account Amounts in Rs. Mln

10. INFORMATION ABOUT BUSINESS SEGMENTS

(C) OTHER DISCLOSURES:
Inter segment revenue/result:
— Inter-segment revenue has been recognised at competitive prices.
— Allocation of corporate expenses to other segments is at cost.
— All profits / losses on inter segment transfers are eliminated at Company level.
Types of products and services in each business segment:
Business Segments Type of products/services
a. Lighting Lamps, Glass shells, Fittings, Accessories for fittings, Electronic HF Ballasts
b. Consumer Electronics Radio sets, tape recorders, compact /digital video disc players/ systems and combinations
sets, Accessories for radio sets and tape recorders, Television receivers, Monitors.
c. Software development services Development of embedded software.
d. Medical systems Medical electronics equipment.
e. Other segments Domestic appliances and Service Revenue etc.

Year ended Year ended

December 31, 2007 December 31, 2006
11. CONSUMPTION OF RAW MATERIALS, % of total % of total
PIECE PARTS AND SPARES consumption Rs. consumption Rs.
Raw materials and piece parts :
Imported 39.5 689 37.7 887
Indigenous 60.5 1,055 62.3 1,465
Spares :
Imported 34.9 22 37.1 23
Indigenous 65.1 41 62.9 39
12. IMPORTS AT C.I.F.
Raw materials and piece parts 880 1,222
Spares 21 21
Software — 102
Capital goods 177 91

13. INCOME AND EXPENDITURE IN FOREIGN EXCHANGE

Income
Exports at F.O.B. including Rs.93 (2006 - Rs.55) 330 454
through rupee trade arrangements
Service revenue etc. 2,813 4,345
Expenditure :
Management support service fees 969 781
Research and development service fees 257 202
Consultation fees and professional charges etc 325 344
Others 208 439

14. OTHER EXCEPTIONAL ITEMS INCLUDE:

(a) Rs.125 - Net surplus on divestment of business relating to “Financial Services” to PAN Financial Shared Services India Private Limited;
[(2006 - Rs.1229 and Rs.32) - Net surplus on divestment of business relating to “Semiconductors” and “Philips Sound Solutions” to
NXP Semiconductors India Private Limited and Premium Sound Solution Private Limited respectively.)].
(b) Rs.295 (2006 - Rs.362) - Profit on sale of property.
(c) Rs.20 (2006 - Rs.Nil) - Being the amount received on final admission / quantification of claim by insurance company in connection with
stocks and fixed assets destroyed during the year 2005 due to flood at the Company’s plant at Vadodara.

38
Notes to Profit and Loss Account Amounts in Rs. Mln

15. The Company uses forward exchange contracts to hedge its exposure in foreign currency. The information on forward contracts is as
follows:

(a) Forward contracts outstanding:

USD Currency Euro Currency
Details As at Dec 31, 2007 As at Dec 31, 2006 As at Dec 31, 2007 As at Dec 31, 2006

INR FC (in 000s) INR FC (in 000s) INR FC (in 000s) INR FC (in 000s)
Receivables 7.23 183.00 358.70 8,109.89 — — 475.33 8,158.75

Payables 283.24 7,135.57 459.89 10,397.73 5.17 88.59 25.26 433.55

(b) Foreign exchange currency exposures not covered by forward contracts:

Details As at Dec 31, 2007 As at Dec 31, 2006 As at Dec 31, 2007 As at Dec 31, 2006
USD Exposure Euro Exposure

INR FC (in 000s) INR FC (in 000s) INR FC (in 000s) INR FC (in 000s)
Receivables 175.71 4,457.78 — — 128.97 2,220.96 28.20 484.02
Payables 450.05 11,466.54 30.25 683.95 183.17 3,154.68 130.29 2,236.28

Details SGD Exposure JPY Exposure

INR FC (in 000s) INR FC (in 000s) INR FC (in 000s) INR FC (in 000s)

Receivables 2.03 73.86 2.82 98.12 — — — —

Payables 0.72 26.34 1.32 45.81 0.04 112.08 — —

Details AUD Exposure GBP Exposure

INR FC (in 000s) INR FC (in 000s) INR FC (in 000s) INR FC (in 000s)
Receivables 0.14 4.04 — — — — — —
Payables 0.09 2.57 — — 0.91 11.47 — —

Details HKD Exposure

INR FC (in 000s) INR FC (in 000s)

Receivables 7.72 1,526.43 0.90 128.29

Payables 2.02 400.18 0.36 50.71

(c) Exchange gain in respect of forward exchange contracts to be recognised in subsequent accounting periods - Rs.1 (2006 - gain - Rs.2).

16. EMPLOYEES’ SHARE-BASED PAYMENTS:

Certain employees of the company are eligible for stock options granted by the Holding Company ("KPENV"). In conformity with the
guidance note on "Accounting for Employee Share-based Payments" issued by The Institute of Chartered Accountants of India in respect
of the grants made on or after 01 April 2005, the following disclosures are made:
(a) Method adopted for valuation:

Stock compensation expenses under the “Fair Value Method” are determined based on the “Fair Value of the Options” and
amortised over the vesting period. The “Fair Value of the Options” is determined using “Black-Scholes” option pricing model.

Annual
Report 2007 39
 PHILIPS ELECTRONICS INDIA LIMITED

Notes to Profit and Loss Account

(b) Nature and extent of Employee Share-based Payment Plans:
As from 2003 onwards, the Holding Company (KPENV) issued restricted share rights that vest in equal annual installments over a
three-year period. Restricted shares are KPENV's shares that the grantee will receive in three successive years, provided the grantee
is still with the Company on the respective delivery dates. If the grantee still holds the shares after three years from the delivery
date, Philips will grant 20% additional (premium) shares, provided the grantee is still with Philips.
As from 2002, the Holding Company granted fixed stock options that expire after 10 years. Generally, the options vest after 3
years; however, a limited number of options granted to certain employees of acquired businesses contain accelerated vesting. In
prior years, fixed and variable (performance) options were issued with terms of ten years, vesting one to three years after grant.
(c) Number and exercise price of Stock Options:
Exercise Price Outstanding as Grants Cancellation Exercise Outstanding as Exercisable
Grant Date (in Euros) at 01.01.2007 at 31.12.2007
2000/02/17 42.03 10,500 — — — 10,500 10,500
2000/04/19 45.90 11,900 — — — 11,900 11,900
2000/10/17 42.90 30,683 — 3,555 — 27,128 27,128
2001/02/08 37.60 27,125 7,438 4,375 — 30,188 30,188
2001/04/17 29.14 34,987 — 8,885 455 25,647 25,647
2001/10/16 24.35 6,000 — — 750 5,250 5,250
2002/02/07 30.17 35,640 — 600 — 35,040 35,040
2002/04/16 34.78 46,908 — 15,264 — 31,644 31,644
2003/04/15 16.77 26,001 — 2,412 4,788 18,801 18,801
2004/04/13 24.13 25,479 — 1,053 1,125 23,301 23,301
2005/04/18 19.41 29,592 — 306 486 28,800 909
2005/07/18 22.07 891 — 891 — — —
2005/10/17 21.64 1,197 — — — 1,197 —
2006/04/18 26.28 36,432 — 2,070 360 34,002 3,294
2007/04/16 30.96 — 36,810 3,222 — 33,588 —
323,335 44,248 42,633 7,964 316,986 223,602
Prior Year 299,254 36,738 6,647 6,010 323,335 237,817

(d) Number and weighted average fair value of Restricted Shares:

Weighted
average fair
value of the
share Outstanding as Outstanding as
Grant Date (in Euros) at 01.01.2007 Grants Cancellation Exercise at 31.12.2007
2003/04/15 48.25 — — — — —
2004/04/13 70.33 2,589 — 48 2,541 —
2005/04/18 55.93 5,966 — 244 2,623 3,099
2005/07/18 63.90 — — — — —
2005/10/17 62.62 266 — — 133 133
2006/04/18 76.34 11,127 — 479 3,824 6,824
2007/04/16 89.51 — 12,270 1,074 — 11,196
19,948 12,270 1,845 9,121 21,252
Prior year 20,839 12,246 932 12,205 19,948
(e) Method and assumptions for arriving at the Fair Value of Restricted Shares:
The fair value of restricted shares is equal to the Fair Value of the stock at grant date net of the present value of dividends which will
not be received up to the vesting date. The expected dividend used is the dividend of the preceding year.

40
Notes to Profit and Loss Account

Amounts in Rs. Mln

(f) Details and Key Assumptions of Options Pricing Model used for Fair Valuation of Options granted during the year:

1. Exercise Price The stock price of the share at the moment of grant
2. Average Life time 6 Years
3. Expected Volatality 27% (Determined on the basis of 5 year historical stock price)
4. Risk free interest rate 4.18%
5. Yield factor 0.018

(g) Expense recognised on account of “Employee Share-Based Payment” is Rs.31 (2006 - Rs.30) and carrying liability as at 31.12.2007 is
Rs.63 (31.12.2006 - Rs.45).
17. Earnings per share 2007 2006
Calculation of earnings per share
(a) Number of shares at the beginning of the year 70,260,733 70,260,733
Total number of equity shares outstanding at the end of the year 70,260,733 70,260,733
Operating profit 2,456 1,485
Fringe benefit tax (38) (61)
Provision for tax on the above (897) (480)
(b) Profit after tax and before exceptional items 1,521 944
Exceptional items net of tax 382 1,186
(c) Profit after tax attributable to equity shareholders 1,903 2,130
(d) Basic and diluted earnings per share before exceptional items (b/a) (in Rs.) 21.65 13.44
(e) Basic and diluted earnings per share after exceptional items (c/a) (in Rs.) 27.08 30.32

18. Dividend remitted for January - December 2006 - Rs.136 (January - December 2005 - Rs.102) on 67,774,840 equity shares to 2 non-
resident shareholders.
19. Fiscal year for the Company being the year ending March 31, 2008, the ultimate tax liability will be determined on the basis of the results for
the period April 1, 2007 to March 31, 2008.

20. Prior year’s figures have been regrouped, recast and restated where necessary to conform to the current year’s classification.
For and on behalf of the Board
Chairman S.M.DATTA
Managing Director MURALI SIVARAMAN
Director C.J.M.REUVERS
New Delhi, March 11, 2008 Secretary R.J.WANI

Annual
Report 2007 41
 PHILIPS ELECTRONICS INDIA LIMITED

Notes to Balance Sheet

Amounts in Rs. Mln
December 31, 2007 December 31, 2006
1. CAPITAL
Authorised
92,000,000 equity shares of Rs.10 each 920 920
20,000,000 non convertible cumulative redeemable
preference shares of Rs.10 each 200 200
1,120 1,120
Issued and subscribed
70,260,733 equity shares of Rs.10 each, fully paid up 703 703
Add: Forfeited shares (amount paid up)
703 703
Of the above:
(a) 67,774,780 equity shares are held by Koninklijke Philips Electronics N.V.(“KPENV”), the holding company.
(b) 24,757,798 equity shares were allotted without payment being received in cash, comprising of 21,875 equity shares allotted
pursuant to a contract and 24,735,923 equity shares allotted pursuant to the schemes of amalgamation in earlier years.
(c) 16,366,000 bonus shares were issued as fully paid up by capitalisation of reserves.

2. RESERVES AND SURPLUS

Capital reserve - revaluation - as at beginning 17 31
Less: Transfer to General Reserve on sale of property 17 13
Less: Transfer to Profit and Loss Account 1
— 17
Capital reserve - amalgamation 168 168
168 168
Capital reserve - others - (refer note 1 below) 1 1
1 1
Capital redemption reserve 100 100
100 100
Capital subsidy - (refer note 2 below) 9 9
9 9
Securities premium 679 679
679 679
General reserve - as at beginning 5,850 3,867
Add: Transfer from Capital Reserve on sale of property 17 13
Add: Transfer from Profit and Loss Account 190 1,970
6,057 5,850
Profit and Loss Account 1,695 150
8,709 6,974

(1) Represents excess amounts received by the erstwhile PMSIL from Philips Medical Systems International BV, which have arisen on
account of the change in method of foreign exchange conversion prescribed by the Reserve Bank of India.
An application to the Reserve Bank of India had been filed by the erstwhile PMSIL for approval to retain these amounts. Such
approval is awaited as at date.
(2) Pertains to land subsidy - Rs.6 and investment incentive - Rs.3 received from Punjab State Government.

42
Notes to Balance Sheet Amounts in Rs. Mln

December 31, 2007 December 31, 2006

3. SECURED LOANS
Finance lease 103 70
103 70
Finance lease is secured by underlying assets.
The total minimum lease liability for assets obtained on finance lease basis is Rs.122 (31.12.2006 - Rs.81) which includes interest of Rs.19
(31.12.2006 - Rs.11). The maturity profile of finance lease obligation is as follows:
Minimum lease payments
Payable within 1 year 41 33
Payable between 1-5 years 81 48
Present value
Payable within 1 year 32 28
Payable between 1-5 years 71 42
4. UNSECURED LOANS
Others:
External Commercial Borrowings * 19 22
Interest accrued and due 17 16
36 38

* Relates to foreign currency loan of USD 500,000 taken from ATL International Inc, USA towards funding working capital requirements.
The said loan bears an interest at LIBOR plus 2% per annum. The Company intends to repay the said loan after necessary approval from
Reserve Bank of India.

5. FIXED ASSETS
Gross block at cost or valuation Depreciation / amortisation Net block

As at Disposals & As at As at For the On disposals As at As at As at

beginning Additions adjustments end beginning year & adjustments end 31.12.2007 31.12.2006

(1+2-3) (5+6-7) (4-8) (1-5)

(1) (2) (3) (4) (5) (6) (7) (8) (9) (10)
Intangibles
- Software 22 — — 22 7 6 — 13 9 15
Land 37 — 10 27 — — — — 27 37
Buildings 713 21 79 655 197 20 44 173 482 516
Leaseholds
- Land 1 — 1 — — — — — — 1
- Improvements 264 306 64 506 109 87 61 135 371 155
- Other assets 145 79 68 156 77 29 50 56 100 68
Machinery and equipment 5,154 462 522 5,094 3,788 343 448 3,683 1,411 1,366
Furniture and fittings 289 125 86 328 159 50 67 142 186 130
Vehicles 16 — 4 12 9 3 4 8 4 7
6,641 993 834 6,800 4,346 538 674 4,210 2,590 2,295

Prior year 7,072 417 848 6,641 4,335 603 592 4,346 2,295
(a) Buildings at cost or valuation include (i) Rs.0.01 (31.12.2006 - Rs.0.01) representing 120 (31.12.2006 - 121) shares at cost in various co-operative
housing societies and (ii) property held for sale at net book value - Rs.1 (31.12.2006 - Rs.23).
(b) Disposals and adjustments of gross block and depreciation include Rs.87 (31.12.2006 - Rs.517) and Rs.33 (31.12.2006 - Rs.335) on account of
divestment of business relating to “Financial Services” for the current year and “Semiconductors” & “Philips Sound Solutions” for the prior year.
(c) Net block of assets taken on lease relates to vehicles - Rs.100 (31.12.2006 - Rs.68).
(d) Commitments on capital account - Rs.48 (31.12.2006 - Rs.198).

Annual
Report 2007 43
 PHILIPS ELECTRONICS INDIA LIMITED

Notes to Balance Sheet Amounts in Rs. Mln

December 31, 2007 December 31, 2006

6. INVESTMENTS
Long term investments at cost - Non-trade
Shares and units
Unquoted
Anyonya Sahayakari Mandali Co-operative Bank Ltd
29,861 fully paid equity shares of Rs.10 each
500 (31.12.2006 - Nil) - 5.25% Rural Electrification
Corporation Limited bonds of Rs.10,000/- each fully paid up 5 —
Quoted
112,658 - 6.75% UTI bonds of Rs.100 each fully paid up 15 15
Gross 20 15
Less: Provision for diminution 4 4
Net 16 11
Quoted - Cost 15 15
- Market value 11 11
Unquoted - Cost 5 —

7. DEFERRED TAX ASSETS - NET

Deferred tax assets
Voluntary retirement scheme 70 132
Retirement benefits 117 147
Receivables 105 98
Others 157 123
449 500
Deferred tax liabilities
Depreciation 209 246
240 254
8. INVENTORIES
Raw materials and piece parts - purchased 111 257
Own manufactured components and piece parts 2
Finished goods 1,611 1,356
Work in progress 229 93
Goods in transit 258 157
Stores and spare parts 46 37
2,255 1,902
9. SUNDRY DEBTORS
Debts considered good :
Debts over six months unsecured 363 216
Debts over six months secured by bank guarantees —
Other debts unsecured 2,719 2,447
[Include Rs.330 (31.12.2006 - Rs.649) due from certain Overseas
Companies as per list given in Note 9(a) to Profit and Loss Account,
- all companies under the same management.
Other debts secured by bank guarantees 38 24
Debts considered doubtful :
Debts over six months 199 186
3,319 2,873
Less : Provision 199 186
3,120 2,687

44
Notes to Balance Sheet Amounts in Rs. Mln

December 31, 2007 December 31, 2006

10. CASH AND BANK BALANCES

Cash and cheques in hand 610 719
With scheduled banks:
Current accounts * 701 447
Exchange Earners Foreign Currency account 422 241
Deposit accounts 5,014 3,771
6,747 5,178
* Includes remittance in transit - Rs.422 (31.12.2006 - Rs.5)

11. LOANS AND ADVANCES

Unsecured considered good (unless otherwise stated):
Loans and advances recoverable in cash or in kind or for value to be 1,261 1,290
received [Includes Rs.Nil (31.12.2006 - Rs.0.40) due from directors]
Maximum amount due at any time during the year
- Rs.0.40 (31.12.2006 - Rs.0.40) from directors
Balances with Customs, Port Trust, Excise, etc. 74 109
Advance payment - Income tax less provision 95 —
Advances considered doubtful 109 101
1,539 1,500
Less : Provision 109 101
1,430 1,399

The Company settled its outstanding lease rental obligations under the existing sale and lease back arrangements with the respective
lessors. However, the formal transfer of legal ownership rights in favour of the Company is under process. Pending the transfer of legal
ownership, the lease margin accounts of concerned lessors amounting to Rs.40 have been retained and are included in loans and
advances recoverable in cash or in kind or for value to be received.

12. LIABILITIES
Acceptances 493 631
Creditors
Micro and Small Enterprises 2 —
Other than Micro and Small Enterprises 5,233 4,239
Unpaid / unclaimed dividends 6 7
Unpaid matured deposits 2 2
Book overdraft 54 —

5,790 4,879

13. PROVISIONS
Proposed dividend 140 140
Tax on proposed dividend 24 20
Income tax net of advance tax — 203
Fringe benefit tax — 17
Retirement benefits (Refer Note 13 a) 379 488
Others (Refer Note 13 b) 618 560

1,161 1,428

The actuarial valuation in respect of gratuity and leave encashment has been done as at December 31, 2007.
In case of Mohali Light factory, Medical Systems and Software Centre the gratuity liabilities are provided as per the actuarial valuation and
are funded through Group Gratuity Schemes of Life Insurance Corporation of India (LIC) to the extent requested by LIC.

Annual
Report 2007 45
 PHILIPS ELECTRONICS INDIA LIMITED

Notes to Balance Sheet

Amounts in Rs. Mln

13 a. Disclosure relating to Defined Benefit Plans / Long Term Compensated Absences - As per Actuarial Valuation as on December 31,
2007 and recognised in the financial statements in respect of Retirement Benefits:

Particulars Leave Provident

Gratuity Encashment Fund
Funded Unfunded
A. Present value of obligations as at
beginning of the year 112 226 175 690

(1) Current service cost 21 25 23 110

(2) Interest cost 9 18 14 50

(3) Benefits settled (17) (22) (31) (134)

(4) Amalgamations — 1 — 1

(5) Curtailments — (11) (9) —

(6) Settlements — (6) — (169)

(7) Actuarial (gain) / loss 16 (94) (40) —

(8) Interest guarantee — — — 11

(9) Employees’ contribution — — — 65

(10) Transfer in — — — 7

Present value of obligations

as at end of the year 141 137 132 631

B. Change in Plan Assets

Plan assets as at beginning of the year 37 — — 735

(1) Expected return on plan assets 3 — — 58

(2) Contributions 23 — — —

(3) Benefits settled (17) — — —

(4) Employer contribution — — — 123

(5) Employee contribution — — — 65

(6) Benefit payments — — — (134)

(7) Asset gain / (loss) — — — 45

(8) Settlements — — — (170)

Plan assets as at end of the year 46 — — 722

Surplus 91

The above surplus of Rs.91 has not been recognised in the financial statements in accordance with Paragraph 59 of Accounting
Standard (AS15), Employee Benefits, since the surplus is not available to the Company either in form of refunds or as reduction
of future contributions.

C. Actual return on plan assets 3 — —

46
Notes to Balance Sheet
Amounts in Rs. Mln
Particulars Leave Provident
Gratuity Encashment Fund
Funded Unfunded

D. Reconciliation of present value of the

obligation and the fair value of the
plan assets:

(1) Present value of obligations

at end of the year (140) (137) (132)

(2) Fair value of Plan assets 46 — —

Prepaid / (Liability) recognised in

Balance Sheet (94) (137) (132)

E. Components of Employer Expense:

(1) Current service cost 21 24 23

(2) Interest cost 9 18 14

(3) Expected return on plan assets

(estimated) (3) — —

(4) Curtailments — (11) (9)

(5) Amortisation - unrecognised gain

/ (loss) — — —

(6) Actuarial (gain) / loss 16 (94) (40)

Total expense recognised in the

Statement of Profit and Loss Account 43 (63) (12)

The gratuity and leave encashment expenses have been recognised in “Salaries, wages, bonus and commission” under Note # 4
to the Profit and Loss Account

F. Assumptions

(1) Discount factor 7.5% 7.5% 7.5%

(2) Estimated rate of return on plan assets 7.5%

(3) Mortality LIC Ultimate 94-96

(4) Disability None

(5) Salary Increase 1st year 14% & thereafter 12%

(6) Attrition rate 23%

(7) Retirement age 58 years that can be extended to 60 years.

Notes:
1. No corresponding figures for the prior year are presented as the Company has adopted AS 15 (R) effective January 1, 2007.
2. As per transitional provisions specified in AS 15 (R), the difference in the liability as per the existing policy followed by the
Company and that arising on adoption of this Standard is required to be charged to opening reserves and surplus account.
However, there is no significant impact on adoption of this Standard which is required to be adjusted in the opening balances
of reserves and surplus.

Annual
Report 2007 47
 PHILIPS ELECTRONICS INDIA LIMITED

Notes to Balance Sheet

Amounts in Rs. Mln
3. Plan assets comprise of contribution to Group Gratuity Schemes of Life Insurance Corporation of India in case of gratuity and
leave encashment and investments under Philips Electronics India Limited Employees’ Provident Fund Plan in case of Provident
Fund.

4. Actuarial (gain) / loss is due to change in actuarial assumptions relating to discount rates and hike in salary in current year as
compared to prior year.

5. The company provides retirement benefits in the form of Provident Fund, Gratuity, Leave Encashment, Superannuation and
other benefits. Provident fund contributions made to “Government Administered Provident Fund” are treated as defined
contribution plan since the Company has no further obligations beyond it’s monthly contributions. Provident Fund contributions
made to “Trust” administered by the Company are treated as Defined Benefit Plan. As per actuarial valuation, the trust has
surplus fund to cover shortfall, if any, on account of guaranteed interest benefit obligation.

13 b. Disclosure relating to Provisions:

(1) Movement in Provisions:

Class of provisions
Particulars of disclosure Replacement Legal and Personnel Other risks Total
guarantee Regulatory related
Opening balance 131 228 61 140 560
Accruals during the year 286 68 75 96 525

Utilisation (234) (8) (77) (134) (453)

Write back — (7) (6) (1) (14)

Closing balance 183 281 53 101 618

(2) Nature of Provisions:

(i) Provision for replacement guarantee

The Company provides for the estimated liability on guarantees given on sale of its products based on past performance
of such products. The provision represents the expected cost of replacement and free of charge services and it is
expected that the expenditure will be incurred over the contractual guarantee period which usually ranges from 6
months to 24 months.

(ii) Legal and Regulatory

The Company has made provision for taxes and duties relating to cases that are pending assessments before Adjudicating
Authorities where possible outflow of resources may arise in future which would depend on the ultimate outcome on
conclusion of the cases.

(iii) Personnel related

The Company has made provisions in respect of amounts payable to certain employees based on their retention and
performance, which are payable over a three year and one year period respectively.

(iv) Other risks

This represent provisions made on prudent basis towards possible outflow of resources in respect of claims other than
those included in (i) and (ii) above against the Company and contractual obligations, which would depend on the
ultimate outcome on conclusion of the respective events.

48
Notes to Balance Sheet
Amounts in Rs. Mln
14. Contingent liabilities

(a) Claims not acknowledged as debts by the Company - Rs.32 (31.12.2006 - Rs.32).

(b) In respect of disputed sales tax demands - Rs. 67 (31.12.2006- Rs.67), excise demands - Rs.180 (31.12.2006 -Rs.180) and income
tax demands - Rs.31 (31.12.2006 - Rs.31)

(c) In respect of suppliers’ / customers’ demands and certain tenancy / customs / sales tax disputes for which the liability is not
ascertainable.

The Company does not expect any reimbursements in respect of the above contingent liabilities. It is not practicable to estimate the
timing of cash outflows, if any, in respect of (a) and (b) above pending resolution of the legal proceedings.

15. This and the information given in Schedule 12 “Liabilities” as required to be disclosed under the Micro, Small and Medium Enterprises
Development Act, 2006 has been determined to the extent such parties have been identified on the basis of information available with
the Company and accordingly there are no Micro, Small and Medium Enterprises to whom the Company owes dues, which are
outstanding for more than 45 days as at December 31, 2007.

16. Prior year’s figures have been regrouped, recast and restated where necessary to conform to the current year’s classification.

For and on behalf of the Board

Chairman S.M.DATTA
Managing Director MURALI SIVARAMAN
Director C.J.M.REUVERS

New Delhi, March 11, 2008 Secretary R.J.WANI

Annual
Report 2007 49
 PHILIPS ELECTRONICS INDIA LIMITED

BALANCE SHEET ABSTRACT AND COMPANY’S GENERAL BUSINESS PROFILE

I. Registration Details
Registration No. 21-06663 State Code 21
Balance Sheet 31 12 2007
Date Date Month Year
II. Capital raised during the year (Amounts in Rs. ’000)
Public Issue Rights Issue
Nil Nil
Bonus Issue Private Placement
Nil Nil
III. Position of Mobilisation and Deployment of Funds (Amounts in Rs. ’000)
Total Liabilities Total Assets
16,501,142 16,501,142
Sources of Funds
Paid-up capital Reserves & Surplus
702,607 8,708,703
Share capital suspense Secured Loans
— 102,772
Unsecured Loans
35,765
Application of Funds
Net Fixed Assets Investments
2,694,964 16,266
Net current assets Misc. expenditure
6,598,831 Nil
Accumulated losses Deferred tax assets - net
Nil 239,786
IV. Performance of Company (Amounts in Rs. ’000)
Total income Total expenditure
28,831,123 25,937,153
Profit / Loss before tax Profit / loss after tax
+ 2,893,970 + 1,903,161
(Tick appropriate box + for Profit, - for Loss)
Earning per share (before exceptional items) in Rs. Dividend rate %
21.65 20
Earning per share (after exceptional items) in Rs.
27.08
V. Generic Names of Three Principal Products / Services of Company
Item Code No. (ITC Code) 8539
Product description Lamps
Item Code No. (ITC Code) 852731
Product description Radio broadcast receivers / combination sets
Item Code No. (ITC Code) HSN 94 05
Product description Lamps Fittings

For and on behalf of the Board

Chairman S.M.DATTA
Managing Director MURALI SIVARAMAN
Director C.J.M.REUVERS
New Delhi, March 11, 2008 Secretary R.J.WANI

50
Cash Flow Statement for the year ended December 31, 2007
Amounts in Rs. Mln
Year ended December 31, 2007 Year ended December 31, 2006
A. Cash flow from operating activities
Net profit before tax and exceptional items 2,456 1,485
Adjusted for
Profit on sale of fixed assets (9) (6)
Write off / other adjustment of fixed assets 24 18
Depreciation (net) 538 602
Unrealised foreign exchange loss (net) (7) 15
Interest received (377) (132)
Interest charged 51 220 45 542
Operating profit before working capital changes 2,676 2,027
Changes in:
Trade and other receivables (409) 295
Inventories (353) 314
Trade payables / other liabilities 932 170 282 891
Cash generated from operations 2,846 2,918
Net Income Tax paid (1,292) (710)
Net cash flow before exceptional items 1,554 2,208
Insurance claim received 32 —
Employees’ voluntary retirement scheme (8) (73)
NET CASH FROM OPERATING ACTIVITIES 1,578 2,135

B. Cash flow from investing activities

Purchase of fixed assets (695) (657)
Proceeds from sale of fixed assets 354 327
Proceeds from sale of business (net) 219 1,883
Investment in long term investments (5) —
Interest received 348 124
NET CASH FROM INVESTING ACTIVITIES 221 1,677

C. Cash flow from financing activities

Proceeds from borrowings 35 2,942
Repayment of borrowings (35) (2,942)
Interest paid (65) (42)
Dividend paid (140) (105)
Tax on dividend paid (25) (15)
NET CASH USED IN FINANCING ACTIVITIES (230) (162)

INCREASE IN CASH & CASH EQUIVALENTS (A+B+C) 1,569 3,650

CASH & CASH EQUIVALENTS - OPENING BALANCE
Cash & Bank Balances (Refer to Note 10 of Balance Sheet) 5,178 1,528
CASH & CASH EQUIVALENTS - CLOSING BALANCE
Cash & Bank Balances (Refer to Note 10 of Balance Sheet) 6,747 5,178
TOTAL 6,747 5,178

In terms of our report of even date For and on behalf of the Board

For BSR & Co. Chairman S.M.DATTA

Chartered Accountants
Managing Director MURALI SIVARAMAN

VIJAY MATHUR Director C.J.M.REUVERS

Partner
New Delhi, March 11, 2008 Membership No. 046476 Secretary R.J.WANI

Annual
Report 2007 51
 PHILIPS ELECTRONICS INDIA LIMITED

Ten-Year Review
Amounts in Rs. Mln

PARTICULARS 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
Income and Dividends
Sales 16,634 17,289 14,931 15,256 16,019 16,367 23,637 28,389 26,486 28,906
Operating profit / (loss) 507 314 (39) 387 1,080 1,257 1,425 1,057 1,485 2,456
As percentage of sales 3.0 1.8 (0.3) 2.5 6.7 7.7 6.0 3.7 5.6 8.5
Profit / (Loss) before tax 200 312 (395) (401) 1,227 1,050 1,492 983 3,029 2,894
As percentage of sales 1.2 1.8 (2.6) (2.6) 7.7 6.4 6.3 3.5 11.4 10.0
Profit / (Loss) after tax 120 281 (342) (211) 1,043 671 1,029 807 2,130 1,903
As percentage of sales 0.7 1.6 (2.3) (1.4) 6.5 4.1 4.4 2.8 8.0 6.6
As percentage of net worth 6.3 13.9 (20.4) (13.4) 32.9 18.5 20.5 14.1 27.7 20.2
Earnings per share (Rs.) 2.6 6.2 (7.5) (4.7) 17.8 11.3 15.4 11.5 30.3 27.1
Dividend per equity share (Rs.) 1.5 2.5 — — 1.5 1.5 1.5 1.5 2.0 2.0

Assets and Liabilities

Net fixed assets 1,919 1,739 1,737 1,462 2,951 2,650 2,837 2,871 2,661 2,694
Investments 153 136 136 161 7 11 11 11 11 16
Deferred tax assets - net — — — 313 159 117 189 268 254 240
Inventories 1,823 1,361 1,597 1,004 1,349 1,608 2,519 2,243 1,902 2,255
Debtors, loans & advances
and cash & bank balances 3,440 3,635 2,571 2,261 2,988 3,442 5,905 6,417 9,264 11,297
Current liabilities & provisions 3,476 3,324 3,085 2,968 3,803 4,041 6,309 5,983 6,307 6,951
Net current assets 1,787 1,672 1,083 297 534 1,009 2,115 2,677 4,859 6,601

Net Investment 3,858 3,546 2,956 2,233 3,651 3,787 5,152 5,827 7,785 9,551
Represented by
Equity share capital 455 455 455 455 455 582 582 703 703 703
Share capital suspense — — — — 226 — 121 — — —
Revaluation reserve 137 107 103 99 107 74 71 31 17 —
Other reserves 1,306 1,461 1,120 1,018 2,383 2,968 4,255 4,974 6,957 8,709
Shareholders’ interest (net worth) 1,899 2,023 1,678 1,572 3,171 3,624 5,029 5,708 7,677 9,412
Debentures 722 500 538 — 83 — — — — —
Loans 1,237 1,023 740 661 397 163 123 119 108 139
Total 3,858 3,546 2,956 2,233 3,651 3,787 5,152 5,827 7,785 9,551

General

Exports (F.O.B) 320 307 253 355 243 331 712 1,011 454 330

Salaries, bonus & staff welfare

(excluding V.R.S) 1,015 1,110 1,038 1,036 1,085 1,170 2,176 3,016 3,268 2,635

Debt : Equity Ratio 51:49 43:57 43:57 30:70 13:87 4:96 2:98 2:98 1:99 1:99

Number of employees at year end 5,042 3,803 3,255 2,410 3,403 2,788 3,986 3,952 3,440 3,135

52
Registered Office
Philips Electronics India Limited
7, Justice Chandra Madhab Road, Kolkata - 700 020
Tel. : 91-33-2475 3621, Fax : 91-33-2475 3839

Corporate Office
Philips Electronics India Limited
Technopolis Knowledge Park, Mahakali Caves Road,
Chakala, Andheri (East), Mumbai - 400 093
Tel. : 91-22-6691 2000, Fax : 91-22-6691 2499

Northern Region
Philips Electronics India Limited
9th Floor, Ambadeep,
14, Kasturba Gandhi Marg, New Delhi - 110 001
Tel. : 91-11-2373 8616, Fax : 91-11-2373 8570

Eastern Region
Philips Electronics India Limited
7, Justice Chandra Madhab Road, Kolkata - 700 020
Tel. : 91-33-2475 3621, Fax : 91-33-2475 3839

Western Region
Philips Electronics India Limited
Technopolis Knowledge Park, Mahakali Caves Road,
Chakala, Andheri (East), Mumbai - 400 093
Tel. : 91-22-6691 2000, Fax : 91-22-6691 2499

Southern Region
Philips Electronics India Limited
Temple Towers - 5th floor
Old No. 476, New No. 672,
Anna Salai, Nandanam, Chennai - 600 035
Tel. 91-44-6650 1000, Fax : 91-44-6650 1085

Royal Philips Electronics

Koninklijke Philips Electronics N. V.
Breitner Center, Amstelplein2
1096 BC Amsterdam,
P. O. Box 77900
1070 MX Amsterdam
The Netherlands
Tel. : 31-20-597 7777