Mahindra & Mahindra Ltd
Directors Reports
Dear Shareholders
Your Directors present their Report together with the audited financial
statements of your Company for the year ended 31st March, 2022.
(Rs. in crores)
| Particulars |
2022 |
2021 |
| Revenue from Operations |
57,446 |
44,630 |
| Other Income |
2,076 |
1,199 |
| Profit before Depreciation, Finance Costs,
Exceptional items and Taxation |
9,118 |
8,157 |
| Less: Depreciation, Amortisation and
Impairment Expenses |
2,451 |
2,370 |
| Profit before Finance Costs, Exceptional items
and Taxation |
6,667 |
5,787 |
| Less: Finance Costs |
223 |
396 |
| Profit before Exceptional items and Taxation. |
6,444 |
5,391 |
| Add: Exceptional items |
(209) |
(3,087) |
| Profit before Taxation |
6,235 |
2,304 |
| Less: Tax Expense |
1,300 |
1,320 |
| Profit for the year |
4,935 |
984 |
| Balance of profit for earlier years |
29,464 |
29,102 |
| Less: Transfer to Retained Earnings |
— |
(20) |
| Profits available for appropriation |
34,399 |
30,106 |
| Add: Due to Scheme of Arrangement |
— |
(294) |
| Add: Other Comprehensive Income/(Loss)* .. |
102 |
(56) |
| Less: Dividend paid on Equity Shares |
1,088 |
292 |
| Balance carried forward |
33,413 |
29,464 |
* Remeasurement of (loss)/gain (net) on defined benefit plans,
recognised as part of retained earnings.
The Financial Year 2022 will go down in India's economic history as an
unprecedented one with huge gyrations in fortune. The second wave of the pandemic hit
lives hard and was way more vicious than the first one. Yet, it was not about Covid in
spite of the second wave, it was more about hope and recovery as India successfully
navigated its course through turbulent waters. As the wave receded, there was a dramatic
surge in the pace of vaccination and India was able to vaccinate most of its eligible
population rapidly. Concomitantly, there wasa rebound in growth as evidenced from high
frequency indicators. However, the enthusiasm was disrupted by the third wave of the
pandemic which fortunately proved to be less vicious and short lived.
The Union Budget doubled down on the investment- oriented strategy
focussing on capital expenditure to kickstart a "virtuous cycle of investment"
while crowding in private investments. However, by the end of February, global risk-off
sentiments gathered steam and geopolitical risks came to the fore from the war in Ukraine.
The return of uncertainty clouded the global macroeconomic and financial landscape even as
the global economy struggled to recover from the pandemic.
The Indian economy is estimated to have grown by 8.9% during the
Financial Year 2022 aided by a favourable base but the economic recovery across the
Sectors was uneven. Private consumption and fixed investment - key drivers of domestic
demand remained subdued being only 1.2% and 2.6% respectively, above their pre-pandemic
levels.
The Profit for the year before Depreciation, Finance Costs, Exceptional
items and Taxation recorded an increase of 11.8% at Rs. 9,118 crores as against Rs. 8,157
crores in the previous year. Profit after tax increased by 401.5% at Rs. 4,935 crores as
against Rs. 984 crores in the previous year.
Your Company continues with its rigorous cost restructuring exercises
and efficiency improvements which have resulted in significant savings through continued
focus on cost controls, process efficiencies and product innovations that exceed customer
expectations in all areas thereby enabling the Company to maintain profitable growth in
the current economic scenario.
Details of Material Changes from the end of the Financial Year till the
date of this Report
No material changes and commitments have occurred after the closure of
the Financial Year 2021-22 till the date of this Report, which would affect the financial
position of your Company.
Performance Review
Automotive Sector
Your Company's Automotive Sector posted total sales of 4,55,570
vehicles (4,35,086 Passenger vehicles, commercial vehicles and 20,484 three-wheelers) as
against a total of 3,48,621 vehicles (3,31,384 four-wheelers and 17,237 three-wheelers) in
the previous year, registering a growth of 30.7%.
In the domestic market, your Company sold a total of 4,23,143 vehicles
as compared to 3,30,271 vehicles in the previous year, resulting in a growth of 28.1%.
In the Passenger Vehicle (PV) segment, your Company sold 2,25,895
vehicles [including 2,23,682 Utility Vehicles (UVs), 2,154 Vans and 59 Cars] registering a
growth of 43.7%, as compared to the previous year's volume of 1,57,215 vehicles [including
1,55,530 UVs, 1,676 Vans and 9 Cars].
In the Commercial Vehicle (CV) segment, your Company sold 1,77,117
vehicles [including 32,039 vehicles <2T GVW, 1,38,643 vehicles between 2-3.5T GVW,
1,891 Light Commercial Vehicles (LCVs) in the LCV > 3.5T segment, 1,135 vehicles in the
7.5-16.2T GVW segment and 3,409 Heavy Commercial Vehicles (HCVs)] registering a growth of
13.4% over the previous year's volume of 1,56,159 vehicles [including 23,789 vehicles <
2T GVW, 1,28,100 vehicles between 2-3.5T GVW, 1,160 LCVs in the LCV > 3.5T segment, 684
vehicles in the 7.5-16.2T GVW segment and 2,426 HCVs].
In the three-wheeler segment, your Company sold 20,131 three-wheelers,
registering a growth of 19.1% over the previous year's volume of 16,897 three-wheelers.
For the year under review, the Indian automotive industry (except 2W)
grew by 15.7%, with the PV industry growth of 13.2% and CV industry growth of 26%. The UV
segment showed growth by 40.4%. Within the CV industry, the LCV goods <3.5T segment
grew by 15.8% while the MHCV goods segment grew by 49.2%.
Your Company's UV volumes stood at 2,23,682 units, a growth of 43.8%.
The UV market share for your Company stood at 15%. For the year under review, the All New
Mahindra-XUV700 launched in August 2021, performed well in the UV segment with a volume of
26,261 units for the Financial Year 2022. It garnered cumulative 50,000 bookings within a
3-hour booking window (spread over 2 days). Thar, Scorpio, XUV300 and Bolero continued to
be strong brands for your Company in the UV segment.
In the LCV<3.5T segment, your Company retained its No.1 position
with 40.3% market share. Your Company sold a total of 1,70,682 vehicles in this segment.
Your Company has a market share of 55% in the LCV 2-3.5T segment, which is the Pickup
segment.
In the Medium and Heavy Commercial Segment (MHCV), your Company sold
4,544 trucks as against 3,110 in the previous year. This is a growth of 46.1%. Your
Company's market share in the MHCV segment stands at 2%.
Your Company is the pioneer for Electric Vehicles (EVs) in India, and
for the year under review, sold (along with its subsidiary Mahindra Electric Mobility
Limited) 17,006 EVs as against 5,418 EVs in the previous year.
During the year under review, your Company posted an export volume of
32,427 vehicles as against the previous year's exports of 18,350 vehicles. This is a
growth of 76.7%.
The spare parts sales for the year stood at Rs. 2,859.2 crores
(including exports of Rs. 235.2 crores) as compared to Rs. 2,165.3 crores (including
exports of Rs. 133.5 crores) in the previous year, registering a growth of 32%.
Farm Equipment Sector
Your Company's Farm Equipment Sector recorded total sales of 3,54,698
tractors (domestic + export) as against 3,54,498 tractors sold in the previous year. These
figures for the current year sales and previous year sales include tractors sold under the
Trakstar brand, which is the third brand of your Company under the subsidiary Gromax Agri
Equipment Limited.
For the year under review, the tractor industry in India recorded sales
of 8,42,266 tractors, a de-growth of 6.4%. Tractor Industry recorded de-growth in
Financial Year 2022 from a high base of highest ever sales in Financial Year 2021.
In the domestic market, your Company sold 3,37,052 tractors, as
compared to 3,43,833 tractors in the previous year (these figures for the current year
sales and previous year sales include tractors sold by Gromax Agri Equipment Limited),
recording a de-growth of 2%. It is the second highest ever volume sold by your Company.
With market share at 40%, a gain of 1.8% over previous year, the Company continues to be
the market leader for the 39th consecutive year. Your Company's performance was
supported by good performance of all products in the portfolio.
Your Company continues to focus on growing the farm mechanisation
space, by offering affordable mechanisation solutions. The portfolio comprises of
Rotavators, Cultivators, Harvesters, Rice transplanters, Balers and
Sprayers.
For the year under review, your Company exported 17,646 tractors which
is a growth of 65.5% over the previous year.
Spare parts net sales for the year stood at Rs. 917 crores (including
exports of Rs. 81 crores) in Financial Year 2022 as compared to Rs. 758.2 crores
(including exports of Rs. 48.8 crores) in the previous Financial Year 2021, registering a
growth of 20.9%.
Other Businesses
Powerol
Under the Powerol brand, your Company has been a leader in providing
power back-up solutions to the telecom industry for more than 14+ years. Your Company
continues to consolidate its presence in the tele-infra management space. Alongside the
Telecom, Powerol has been increasing the Retail market share, especially with the
extension in HkVA range. With the introduction of the BS IV range of engines, Powerol has
introduced 21 new nodes for various industrial applications.
Powerol stands at No. 2 brand by volume in the overall Diesel Genset
power back-up segment.
Powerol's move towards sustainability has led to the introduction of
the Gas Powered gensets with introduction of 5 nodes between 15 kVA to 315 kVA. They offer
lower operating costs and low emissions complying to the new emission norms.
Construction Equipment
For the year under review, your Company (under the Mahindra EarthMaster
brand) sold 729 Backhoe Loaders (BHLs) against 681 in Financial Year 2020-21, which is a
growth of 7%. Your Company also has a presence in the road construction equipment business
through motor graders (under the Mahindra RoadMaster brand).
For the year under review, your Company sold 117 motor graders, as
against 82 in Financial Year 2020-21 which is a growth of 42.7%. The BHL industry de-grew
by 31% due to transition from BS3 to BS4 and commodity inflation. The Grader industry has
grown by 14% with increased focus on the infrastructure development push by the Government
of India.
Your Company has presence in Sugar Cane Haulage (under Mahindra Haul
Master Brand) in Kenya. This is a new product which is added to the portfolio. For the
year under review, your Company sold 105 Haulage tractors.
Two-Wheeler Business
In line with the strategy for the two-wheeler business, your Company
through its subsidiary, Classic Legends Private Limited had reintroduced the iconic brand
'Jawa' to the Indian market in the Financial Year 2019, with the launch of new range of
JAWA motorcycles - Jawa and Jawa Forty-Two. A new addition to portfolio - Yezdi was
launched in the Financial Year 2021-22.
Launch of Non-Fungible Tokens (NFTs)
The launch of NFTs is another step taken by your Company to leverage
the next frontier of digital marketing. With the release of its first tranche of tokens,
it became the first Indian automotive original equipment manufacturer to enter the
universe of NFTs.
Current Year's review
During the period 1st April, 2022 to 27th May,
2022, 90,899 vehicles were produced as against 54,903 vehicles and 79,739 vehicles were
dispatched as against 49,117 vehicles during the corresponding period in the last year.
During the same period 64,447 tractors were produced and 64,180 tractors dispatched as
against 55,904 tractors produced and 55,682 tractors dispatched during the corresponding
period in the previous year.
The tectonic shifts beginning 24th February, with the
commencement of war in Ukraine, followed by sanctions and escalating geopolitical tensions
have cast a shadow on the pace of global recovery. Medium-term global growth is expected
to decline to about 3%, compared to an average of 4.1% in the period from 2004 to 2013,
and growth of 6.1% in 2021 as per the IMF. It has pared its expectation of global economic
activity to slow with a projection of a 3.6% growth in 2022.
The global economy is staring at fractures in the international
financial architecture and accentuation of shortage in key commodities will add to the
inflationary pressures throughout 2022 with a projection of 5.7% in advanced economies and
8.7% in emerging economies. Global central banks across the world, look set to tighten
monetary policy conditions in a bid to counter the growing inflationary pressures even if
it leads to some sacrifice of growth.
Financial market volatility caused by monetary policy normalisation in
advanced economies, geo-political backdrop, higher oil and commodity prices and renewed
wave of COVID-19 pose a challenging backdrop in Financial Year 2023. Infections with
augmented supply- side disruptions and protracted shortages of criticalinputs, such as
semi-conductors and chips, pose downside risks to the outlook. Yet, India remains
relatively better positioned to weather these storms and is estimated to grow at 7.2% in
the Financial Year 2023 - the fastest growth rate among peers and economies of its size.
While fiscal and monetary policies were supportive of India's growth
recovery thus far, the Reserve Bank of India has begun the process of normalisation of
monetary policy by raising the policy repo rate as well as the cash reserve ratio.
However, an avowed fiscal policy focus on capital expenditure that has significantly
higher multipliers than other forms of spending will fuel durable growth over the medium
to long term. Importantly, forecasts of the fourth successive 'normal' Monsoon, higher
vaccination coverage and seropositivity in the community provide higher margin of safety
around growth in the year ahead.
Finance
Reeling under the jaws of an unprecedented Financial Year 2020-21,
caused due to outbreak of COVID-19 severely impacting human lives, global trade and
commerce, Financial Year 2021-22 saw the financial markets grappling with the Delta
variant of COVID-19, choked supplies, escalating geo-political tensions, inflationary
pressures, mounting commodity prices and volatility that came together as a perfect storm.
Emerging economies experienced disruptive spillovers in terms of
tightening financial market conditions, besides capital outflows and currency
depreciations. Given these unsettled conditions, investors sporadically sought shelter of
safe-haven assets alternating between phases of risk- on activity with every positive news
being priced in. Consequently, financial markets were on the edge, like never before.
Having said the above, the domestic economy experienced tremors from
these developments. Economic activity, which gained slight traction in Q2:2021-22
(July-September) with the ebbing of the second wave experienced during Q1:2021-22
(April-June), has lost pace since Q3:2021-22 (October-December), exacerbated by the spread
of the Omicron variant in Q4:2021-22 (January-March). Further, the beneficial effects of
the rapid ebb of infections have, however, been overwhelmed by the geopolitical tensions
towards the later part of the financial year. The fallout of the Russia-Ukraine conflict
and retaliatory sanctions is already evident in the inflation prints. While India's direct
trade and financial exposures are modest, indirect spillovers from the slowing global
economy, the sharp jump in commodityprices across the board and elevated risk aversion and
uncertainty owing to geopolitical developments weigh heavily on the outlook.
However, amidst this backdrop, the Bankers continue to rate your
Company as a prime customer and extend facilities/services at prime rates. Your Company
follows a prudent financial policy and aims not to exceed an optimum financial gearing at
any time. The Company's gross Debt to Equity Ratio is 0.17 as at 31st March,
2022.
During the year, your Company continued to focus on managing cash
efficiently and ensured that it had adequate liquidity and back up lines of credit. During
the year, your Company raised short term borrowings of Rs. 1,000 crores by issuing
Commercial Papers. This ensured sufficient liquidity to manage the adverse effects of
pandemic, if any. Further, during the year, your Company repaid Rs. 2,233.75 crores of the
total borrowings (long term and short term). With a high liquidity level of Rs. 11,552.59
crores as at 31st March, 2022, your Company is better placed to tide over the
impact of the re-surge in COVID-19 cases on the business, if any.
Further, your Company has been rated by CRISIL Limited
("CRISIL"), ICRA Limited ("ICRA"), India Ratings and Research Private
Limited ("India Ratings") and CARE Ratings Limited ("CARE") for its
Banking facilities. All have re-affirmed the highest credit rating for your Company's
Short Term facilities. For Long Term facilities and Non-Convertible Debentures, CRISIL,
ICRA and India Ratings have re-affirmed their credit ratings of CRISIL AAA/Stable,
[ICRA]AAA (stable) and IND AAA/Stable for the respective facilities rated by them. With
the above rating affirmations, your Company continues to enjoy the highest level of rating
from all major rating agencies at the same time.
The AAA ratings indicate highest degree of safety regarding timely
servicing of financial obligations and is also a vote of confidence reposed in your
Company's Management by the rating agencies. It is an acknowledgement of the strong credit
profile of your Company over the years, resilience in earnings despite cyclical
upturns/downturns, robust financial flexibility arising from the significant market value
of its holdings and prudent management.
Your Company is a "Large Corporate" as per the criteria under
Securities and Exchange Board of India ("SEBI") Operational Circular No.
SEBI/HO/DDHS/P/CIR/2021/613 dated 10th August, 2021. The Company has complied
with the provisions of the said Circular and has made required disclosures in this regard.
Investor Relations (IR)
Your Company always believes in leading from the front with emerging
best practices in IR and building a relationship of mutual understanding with domestic and
foreign investors/analysts. In the Financial Year 2022, the year characterised by a lot of
uncertainty amongst pandemic and lockdowns, your Company increased its interaction with
investors through video and audio conference calls. The top management, including the
Managing Director & CEO, Executive Director-Automotive & Farm Sectors and Group
CFO, spent significant time to interact with investors to communicate the strategic
direction of the business, capital allocation policy and the way the Company was handling
COVID-19 crisis. All the four quarterly earnings calls conducted during the year were also
well attended by investors and analysts.
During the year, your Company interacted with more than 600 Indian and
overseas investors and analysts (excluding quarterly earnings calls and specific event
related calls). Your Company ensures that critical information about the Company is
available to all the investors by uploading all such information on the Company's website.
Your Company also engages with investors on Environment, Social and
Corporate Governance (ESG), which has received excellent feedback from investors and ESG
analysts.
Dividend
As per the Dividend Distribution Policy, dividend payout would have to
be determined based on available financial resources, investment requirements and taking
into account optimal shareholder return. Within these parameters, the Company would
endeavour to maintain a total dividend pay-out ratio in the range of 20% to 35% of the
annual standalone Profits after Tax (PAT) of the Company.
Despite the impact of the pandemic, your Company was able to deliver a
good operational performance during the period under review.
Your Directors, considering the good performance and a strong cash
flow, decided to recommend a Dividend of Rs. 11.55 (231%) per Ordinary (Equity) Share of
the face value of Rs. 5 each on the Share Capital out of the Profits for the financial
year ended 31st March, 2022.
The equity dividend outgo for the Financial Year 202122 would absorb a
sum of Rs. 1,435.89 crores [as against Rs. 1,087.79 crores comprising the dividend of Rs.
8.75 per Ordinary (Equity) Share of the face value of Rs. 5 each for the previous year].
Dividend will be payable subject to approval of members at the ensuing Annual General
Meeting and deduction of tax at source tothose Shareholders whose names appear in the
Register of Members as on the Book Closure Date. The Board of your Company decided not to
transfer any amount to the General Reserve for the year under review.
Dividend Distribution Policy
The Dividend Distribution Policy containing the requirements mentioned
in Regulation 43A of the SEBI (Listing Obligations and Disclosure Requirements)
Regulations, 2015 ("Listing Regulations") is attached as Annexure I and forms
part of this Annual Report.
The Dividend Distribution Policy of the Company is also uploaded on the
Company's website at the following Web-link: http://www.mahindra.com/resources/investor-
reports/FY17/Governance/MM-Dividend-Distribution- Policy-29-9-2016-Final.pdf.
The Consolidated Financial Statements of the Company, its subsidiaries,
associates and joint ventures prepared in accordance with the Companies Act, 2013 and
applicable Indian Accounting Standards along with all relevant documents and the Auditors'
Report form part of this Annual Report. The Consolidated Financial Statements presented by
the Company include the financial results of its subsidiary companies, associates and
joint ventures.
The Consolidated Group's Operating Revenue from continuing operations
is Rs. 90,171 crores in the current year as compared to Rs. 74,278 crores in the previous
year i.e. an increase of 21.4%.
The consolidated profit before exceptional items and tax for the year
from continuing operations is Rs. 7,092 crores as against Rs. 5,229 crores in the previous
year i.e. an increase of 35.6%. The consolidated profit after tax after non-controlling
interest and exceptional items for the year from continuing operations is Rs. 6,577 crores
as against Rs. 3,347 crores in the previous year i.e. an increase of 96.5%.
The consolidated profit after tax after noncontrolling interest and
exceptional items for the year from continuing and discontinued operations is Rs. 6,577
crores as against Rs. 1,812 crores in the previous year i.e. an increase of 263%.
The Financial Statements as stated above are also available on the
website of the Company and can be accessed at the Web-link: https://www.mahindra.com/
resources/FY22/AnnualReport.zip.
Subsidiary, Joint Venture and Associate Companies
The Mahindra Group Companies continue to contribute to the overall
growth in revenues and overall performance of your Company.
Tech Mahindra Limited, Flagship Company in the IT Sector, has reported
a consolidated operating revenue of Rs. 44,646 crores in the current year as compared to
Rs. 37,855 crores in the previous year, an increase of 17.9%. Its consolidated profit
after tax after non-controlling interests is Rs. 5,566 crores as compared to Rs. 4,428
crores in the previous year, registering an increase of 25.7%.
The Group's finance company, Mahindra & Mahindra Financial Services
Limited, a listed subsidiary of the Company (Mahindra Finance), reported a consolidated
operating income of Rs. 11,318 crores during the current year as compared to Rs. 12,111
crores in the previous year, registering a decrease of 6.5%. The consolidated profit after
tax after non-controlling interests for the year is Rs. 1,137 crores as compared to Rs.
773 crores in the previous year, registering an increase of 47.1%.
Mahindra Lifespace Developers Limited, the listed subsidiary in the
business of real estate and infrastructure, registered a consolidated operating income of
Rs. 394 crores as compared to Rs. 166 crores in the previous year, registering an increase
of 137.3%. The consolidated profit after tax after non-controlling interest for the year
is Rs. 154 crores as compared to a loss of Rs. 72 crores in the previous year, registering
an increase of 313.9%.
Mahindra Holidays & Resorts India Limited, the listed subsidiary in
the business of timeshare, registered a consolidated operating income of Rs. 2,013 crores
as compared to Rs. 1,730 crores in the previous year i.e. an increase of 16.4%. The
consolidated profit after tax after non-controlling interests for the year is Rs. 68
crores as compared to a loss of Rs. 13 crores in the previous year, registering an
increase of 623.1%.
Mahindra Logistics Limited, a listed subsidiary in the logistics
business, has registered a consolidated operating income of Rs. 4,083 crores as compared
to Rs. 3,264 crores in the previous year i.e. an increase of 25.1%. The consolidated
profit after tax after noncontrolling interests for the year is Rs. 37 crores as compared
to Rs. 30 crores in the previous year, registering an increase of 23.3%.
Ssangyong Motor Company, the Korean subsidiary of the Company (under
the Companies Act, 2013), treated as discontinued operation for the purpose of
consolidationin previous year, has reported consolidated operating revenues of Rs. 15,499
crores in the current fiscal year* as compared to Rs. 18,763 crores in the previous fiscal
year*. The consolidated loss after tax after non-controlling interests for the current
fiscal year* is Rs. 1,646 crores as compared to a consolidated loss of Rs. 3,208 crores in
the previous fiscal year*. SsangYong Motor (Shanghai) Company Limited (as informed by
Receiver of SsangYong Motor Company) ceased to be a Subsidiary of the Company.
* Fiscal year-January to December
During the year under review, Carnot Technologies Private Limited
ceased to be an Associate and became a Subsidiary of your Company.
Further, Mahindra Solarize Private Limited, Mahindra Ideal Finance
Limited and Bristlecone Internacional Costa Rica Limited became Subsidiaries of your
Company.
During the year under review, Mahindra Vehicle Manufacturers Limited,
Hisarlar Makina Sanayi ve Ticaret Anonim ?irketi, Hisarlar Ithalat Ihracat Pazarlama
Anonim ?irketi, Mahindra Publications Limited, MSPE Urja S.R.L., Mahindra Susten
Bangladesh Private Limited and Suomen Vapaa-aikakiinteistot Oy LKV ceased to be
Subsidiaries of your Company.
ReNew Sunlight Energy Private Limited became an Associate of your
Company.
During the year, Mahindra CIE Automotive Limited became an Associate of
the Company pursuant to the Scheme of Merger by Absorption of Mahindra Vehicle
Manufacturers Limited with the Company becoming effective.
During the year under review, Mahindra Greenyard Private Limited
changed its name to Mahindra Fruits Private Limited, Ideal Finance Limited changed its
name to Mahindra Ideal Finance Limited and Mahindra Telecom Energy Management Services
Limited converted itself into private company and accordingly, its name was changed to
Mahindra Telecom Energy Management Services Private Limited.
Subsequent to the year end, Kiinteisto Oy Rauhan Ranta 1, Kiinteisto Oy
Rauhan Ranta 2, Kiinteisto Oy Kylpylantorni 1, Kiinteisto Oy Spa Lofts 2, Kiinteisto Oy
Spa Lofts 3, Kiinteisto Oy Tiurunniemi, Kiinteisto Oy Vanha Ykkostii, Kiinteisto Oy
Katinnurkka, Kiinteisto Oy Tenetinlahti, Kiinteisto Oy Himos Gardens, Kiinteisto Oy
Kuusamon Pulkkajarvi 1, Kiinteisto Oy Mallosniemi, Kiinteisto Oy Rauhan Liikekiinteistot
1, OFD Holding B.V., Origin Direct Asia Limited, Origin Direct Asia (Shanghai) Trading Co.
Limited, Origin Fruit Direct B.V., Origin Fruit
Services South America SpA, Mahindra Engineering and Chemical Products
Limited, Retail Initiative Holdings Limited and Mahindra Retail Limited ceased to be
Subsidiaries of your Company.
Meru Mobility Tech Private Limited ("MMTPL"), V-Link Fleet
Solutions Private Limited ("VFSPL") and V-Link Automotive Services Private
Limited ("VASPL") have ceased to be subsidiaries of Meru Travel Solutions
Private Limited ("MTSPL"), a wholly owned subsidiary of your Company and have
become subsidiaries of Mahindra Logistics Limited ("MLL"), a listed subsidiary
of your Company.
Further, MTSPL has also ceased to be a wholly owned subsidiary of your
Company and has become a wholly owned subsidiary of MLL. Since MLL is a listed subsidiary
of your Company, MTSPL, MMTPL, VFSPL and VASPL continue to remain the subsidiaries of your
Company.
Subsequent to the year end, name of Supermarket Capri Oy has been
changed to Kiinteisto Oy Rauhan Liikekiinteistot 1.
Subsequent to the year end, Brainbees Solutions Private Limited became
an Associate of your Company pursuant to the Scheme of Merger by Absorption of Mahindra
Engineering and Chemical Products Limited, Retail Initiative Holdings Limited and Mahindra
Retail Limited with the Company becoming effective.
A Report on the performance and financial position of each of the
subsidiaries, associates and joint venture companies included in the Consolidated
Financial Statements and their contribution to the overall performance of the Company, is
provided in Form AOC-1 and forms part of this Annual Report.
The Policy for determining material subsidiaries as approved by the
Board is uploaded on the Company's website and can be accessed in the Governance section
at the Web-link: https://www.mahindra.com/investors/reports-and-filings.
Investment in Carnot Technologies Private Limited
During the year, your Company increased its shareholding in Carnot
Technologies Private Limited ("Carnot"), from 48.05% to 68.97% on a fully
diluted basis, for an aggregate consideration of Rs. 14 crores comprising of primary
infusion in the company of Rs. 2.5 croresand secondary purchase from its shareholders of
Rs. 11.5 crores. Carnot is an Indian Company engaged in the business of technology
development, related to IOT, data analytics and AI based products and services. Carnot is
expected to support the Company's strategy by developing digital solutions and
applications for its products, customers and businesses, especially for the Farming as a
Service segment.
Increase of stake in M.I.T.R.A. Agro Equipments
Private Limited
During the year, your Company increased its shareholding in M.I.T.R.A.
Agro Equipments Private Limited ("MITRA"), from 39.02% to 47.33% on a fully
diluted basis, for an aggregate consideration of around Rs. 7 crores. MITRA is an Indian
Company engaged in the business of designing, developing, manufacturing, assembling and
selling orchard sprayers, rotavators & spare parts and after sales services therefor.
The purchase of additional equity shares in MITRA would support the Company's Farm
Equipment Sector's growth in the horticulture sector.
Merger of Mahindra Vehicle Manufacturers Limited
into Mahindra & Mahindra Limited
As mentioned in the previous Annual Report, the Board of Directors of
your Company at its Meeting held on 29th May, 2019, subject to requisite
approvals/consents, approved the Scheme of Merger by Absorption of Mahindra Vehicle
Manufacturers Limited, a wholly owned subsidiary of the Company ("MVML") with
the Company and their respective shareholders ("Scheme") under the provisions of
sections 230 to 232 of the Companies Act, 2013.
During the year, the Scheme has become effective from 1st
July, 2021 post receipt of approvals from Directorate of Industries, Maharashtra
Industrial Development Corporation and National Company Law Tribunal, Mumbai Bench
("NCLT").
The Appointed Date of the Scheme was 1st April, 2019 and the
entire assets and liabilities of MVML have been transferred to and recorded by the Company
at book values. The entire share capital of MVML was held by the Company. Upon the Scheme
being effective, all shares ('Preference and Equity') held by the Company in MVML stand
cancelled, without any further act or deed and no consideration has been discharged on
merger. Accordingly, the Merger by Absorption of MVML with the Company stands completed.
Sale of stake in Meru Travel Solutions Private Limited by the Company
to Mahindra Logistics Limited
During the year, Meru Travel Solutions Private Limited
("MTSPL"), a wholly owned subsidiary of the Company had agreed to sell its
entire 100% equity stake in MTSPL's 3 (three) wholly owned subsidiaries viz; 1) Meru
Mobility Tech Private Limited ("MMTPL") for consideration of Rs. 21.4 crores, 2)
V-Link Fleet Solutions Private Limited ("VFSPL") for consideration of Rs. 1,205
and 3) V-Link Automotive Services Private Limited ("VASPL") for consideration of
Rs. 29.1 crores, to Mahindra Logistics Limited ("MLL") and the Company had also
agreed to sell its entire 100% equity stake in MTSPL to MLL for consideration of Rs. 50.4
crores.
Subsequent to the year end, MTSPL, MMTPL, VFSPL and VASPL have become
wholly owned subsidiaries of MLL. Since MLL is a subsidiary of the Company, MTSPL, MMTPL,
VFSPL and VASPL continue to remain subsidiaries of the Company. This transaction was a
strategic move to consolidate all mobility businesses under MLL.
Ssangyong Motor Company
During the year, Ssangyong Motor Company (SYMC) was placed under Court
Receivership as per the provisions of Debtor Rehabilitation and Bankruptcy Act of South
Korea. Subsequently, SYMC initiated a global bidding process to invite a new investor to
take a majority ownership. In October, it signed an MOU with a consortium led by Edison
Motors Co., a Korea-based electric bus manufacturer. In January 2022, the Edison Motors
Co. consortium signed an investment agreement to invest around KRW 305 billion in SYMC.
However, the consortium did not deposit the investment amount by the deadline as per the
agreement, following which SYMC terminated the agreement. The Edison Motors Co. consortium
has appealed against the termination of agreement. SYMC has initiated a process to invite
new investor(s).
Disinvestment of Hisarlar Makina, Turkey
During the year, Mahindra Overseas Investment Company (Mauritius)
Limited, a wholly owned subsidiary of the Company ("MOICML") and Erkunt Traktor
Sanayi A.S. ("Erkunt"), a wholly owned subsidiary of MOICML and that of the
Company, divested its entire stake aggregating 94.3% of the paid-up equity share capital
of Hisarlar Makina Sanayi ve Ticaret Anonim ?irketi ("Hisarlar"), to two
Turkish individuals for an aggregate consideration of Turkish Lira 6.6 million (equivalent
to approximately Rs. 5.6 crores). Hisarlar's agri-machinery business, along with certain
relevant assets (including intellectual property and tooling) were transferred to Erkunt.
Erkunt also entered into contract manufacturing and licensing agreements with Hisarlar,
whereby Hisarlar will manufacture and supply agri-machinery products to Erkunt, and Erkunt
will have the right to use Hisarlar brand for agri-machinery.
Merger of Mahindra Engineering and Chemical Products Limited, Retail
Initiative Holdings Limited and Mahindra Retail Limited into Mahindra & Mahindra
Limited
As mentioned in the previous Annual Report, the Board of Directors of
your Company at its Meeting held on 28th May, 2021, subject to requisite
approvals /consents, approved the Scheme of Merger by Absorption of Mahindra Engineering
and Chemical Products Limited ("MECPL"), Retail Initiative Holdings Limited
("RIHL") and Mahindra Retail Limited ("MRL") (together referred to as
'Transferor Companies'), direct/indirect wholly owned subsidiaries of the Company, with
the Company and their respective Shareholders ("Scheme") under sections 230 to
232 and other applicable provisions of the Companies Act, 2013. The Scheme has been
approved by the National Company Law Tribunal, Mumbai Bench at its hearing held on 24th
March, 2022, and the Scheme has become effective from 29th April, 2022
("Effective Date"). The Appointed Date of the Scheme was 1st April,
2021 and the entire assets and liabilities of MECPL, RIHL and MRL have been transferred to
and recorded by the Company at their carrying values with effect from the Appointed Date.
The entire share capital of the Transferor Companies was held
directly/indirectly by the Company. Upon the Scheme becoming effective, no shares of the
Company were allotted in lieu or exchange of the holding of the Company in MECPL or one
Transferor Company in another Transferor Company (held directly and jointly with its
nominee shareholders) and accordingly, equity shares held in the Transferor Companies
stand cancelled on the Effective Date without any further act, instrument or deed.
Accordingly, the Merger by Absorption of MECPL, RIHL and MRL with the Company stands
completed.
Merger of Mahindra Electric Mobility Limited into Mahindra &
Mahindra Limited
As mentioned in the previous Annual Report, the Board of Directors of
your Company at its Meeting held on
28th May, 2021, subject to requisite approvals/consents,
approved the Scheme of Merger by Absorption of Mahindra Electric Mobility Limited
("MEML") with the Company and their respective shareholders ("Scheme")
under the provisions of sections 230 to 232 and other applicable provisions of the
Companies Act, 2013. The Appointed Date of the Scheme is 1st April, 2021 or
such other date as may be directed or approved by the National Company Law Tribunal
("NCLT") or any other appropriate authority. On completion of the merger, the
entire assets and liabilities of MEML would be transferred to and recorded by the Company
as per applicable accounting standards.
The Scheme provides for issue of Ordinary (Equity) Shares by the
Company to the shareholders of MEML (other than the Company or subsidiary(ies) of the
Company holding shares directly and jointly with its nominee shareholders). The share
exchange Ratio is 480 (Four Hundred and Eighty) Ordinary (Equity) Shares of Rs. 5 each
fully paid-up of the Company for every 10,000 (Ten Thousand) Equity Shares of Rs. 10 each
fully paid-up held in MEML as on Record Date. The shares held in MEML by the Company or
its subsidiary(ies) directly and jointly with its nominee shareholders shall be cancelled
upon the Scheme becoming effective. Additionally, the stock options held by the eligible
ESOP holders of MEML as on the Record Date shall be substituted with ESOPs of the Company
in accordance with the Scheme. The Company has received Observation letters from BSE
Limited and National Stock Exchange of India Limited, conveying their no-objection to the
Scheme. The Company has filed the Scheme for admission with the NCLT, Mumbai Bench.
Divestment of stake by Mahindra Engineering and Chemical Products
Limited in Mahindra Tsubaki Conveyor Systems Private Limited
Mahindra Engineering and Chemical Products Limited ("MECPL"),
a wholly owned subsidiary of the Company (merged with the Company with effect from 29th
April, 2022), has sold its entire stake aggregating 49% of the paid-up Equity Share
Capital of Mahindra Tsubaki Conveyor Systems Private Limited ("MTC") on 21st
February, 2022 for a consideration of Rs. 58.89 crores to Tsubakimoto Bulk Systems Corp.,
(TBS) headquartered in Osaka, Japan, a wholly owned subsidiary of Tsubakimoto Chain Co.,
Japan, a public listed company on the Tokyo Stock Exchange. Pursuant to this transaction,
the shareholding of MECPL in MTC has become 'Nil' and MTC had ceased to be an associate of
MECPL with effect from 21st February, 2022.
Investment in ReNew Sunlight Energy Private Limited
ReNew Sunlight Energy Private Limited ("RSEPL") became an
Associate of the Company on 6th July, 2021. The Company subscribed to
1,60,74,000 Equity Shares of RSEPL amounting to 37.2% of the equity share capital of RSEPL
for a consideration of Rs. 16.07 crores. The investment in RSEPL will enable the Company
to become a Captive User and consume Solar Power generated by RSEPL.
RSEPL is an Indian company, incorporated on 15th December,
2020 which intends to setup Solar Park and generate solar power. RSEPL is subsidiary of
ReNew Green Energy Solutions Private Limited ("RGESPL") which in turn is a
subsidiary of Renew Power Private Limited.
Sale of Stake held by the Company in Mahindra Sanyo Special Steel
Private Limited pursuant to exercise of a Put Option
Subsequent to the year end, the Company has agreed to sell 34,75,264
Equity Shares of Rs.10 each held by the Company in Mahindra Sanyo Special Steel Private
Limited ('MSSSPL') constituting 22.81% of the Paid-up Capital of MSSSPL to Sanyo Special
Steel Co., Ltd ("Sanyo") pursuant to exercise of a Put Option available to the
Company on Sanyo under the Shareholders' Agreement. Following the sale, the Company's
holding in MSSSPL would become 'Nil' and MSSSPL would cease to be an Associate of the
Company.
Disinvestment of OFD Holding B.V., the Netherlands
In April 2022, Mahindra Fresh Fruits Distribution Holding Company
(Europe) B.V. ("MFFD") sold its entire stake aggregating 83.09% of the paid-up
Equity Share Capital held in OFD Holding B.V. ("OFD"), a subsidiary of MFFD
which in turn is a subsidiary of Mahindra Agri Solutions Limited and that of the Company,
for a consideration of EUR 5.1 million (equivalent to Rs. 42.2 crores).
The Corporate Governance Policies guide the conduct of affairs of your
Company and clearly delineate the roles, responsibilities and authorities at each level of
its governance structure and key functionaries involved in governance. The Code of Conduct
for Senior Management and Employees of your Company (the Code of Conduct) commits
Management to financial and accounting policies, systems and processes. The Corporate
Governance Policies and the Code of Conduct stand widely communicated across your Company
at all times.
Your Company's Financial Statements are prepared on the basis of the
Significant Accounting Policies that are carefully selected by Management and approved by
the Audit Committee and the Board. These Accounting policies are reviewed and updated from
time to time.
Your Company uses SAP ERP Systems as a business enabler and to maintain
its Books of Account. The transactional controls built into the SAP ERP Systems ensure
appropriate segregation of duties, appropriate level of approval mechanisms and
maintenance of supporting records. The Policies related to the Information Management
reinforce the control environment. The systems, Standard Operating Procedures and controls
are reviewed by Management. These systems and controls are subjected to Internal Audit and
their findings and recommendations are reviewed by the Audit Committee which ensures the
implementation.
Your Company has in place adequate internal financial controls with
reference to the Financial Statements commensurate with the size, scale and complexity of
its operations. Your Company's Internal Financial Controls were deployed through Internal
Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations
of the Treadway Commission (COSO), that addresses material risks in your Company's
operations and financial reporting objectives.
Such controls have been assessed during the year under review taking
into consideration the essential components of internal controls stated in the Guidance
Note on Audit of Internal Financial Controls Over Financial Reporting issued by The
Institute of Chartered Accountants of India. Based on the results of such assessments
carried out by the Management, no reportable material weakness or significant deficiencies
in the design or operation of internal financial controls was observed.
Your Company recognizes that the Internal Financial Controls cannot
provide absolute assurance of achieving financial, operational and compliance reporting
objectives because of its inherent limitations. Also, projections of any evaluation of the
Internal Financial Controls to future periods are subject to the risk that the Internal
Financial Controls may become inadequate because of changes in conditions or that the
degree of compliance with the policies or procedures may deteriorate. Accordingly, regular
audits and review processes ensure that such systems are reinforced on an ongoing basis.
A detailed analysis of your Company's performance is discussed in the
Management Discussion and Analysis Report, which forms part of this Annual Report.
All Related Party Transactions entered during the year were in the
ordinary course of business and on arm's length basis. During the year under review, your
Company had not entered into any Material Related Party Transactions, i.e. transactions
exceeding ten percent of the annual consolidated turnover as per the last audited
financial statements.
The confirmation that there are Nil Material Related Party
Transactions, as required under section 134(3)(h) of the Companies Act, 2013 is given in
Form AOC-2 as Annexure II, which forms part of this Annual Report.
The Policy on Materiality of and Dealing with Related Party
Transactions as approved by the Board is uploaded on the Company's website and can be
accessed in the Governance section at the Web-link:
https://www.mahindra.com/investors/reports-and-filings.
Statutory Auditors and Auditors' Report
As approved by the Shareholders at the 71st Annual General
Meeting (AGM) of the Company held on 4th August, 2017, Messrs B S R & Co.
LLP, Chartered Accountants (ICAI Firm Registration Number 101248W/ W-100022), the retiring
Auditors will complete their 5 years tenure as Statutory Auditors of the Company on the
conclusion of the 76th AGM of the Company.
The Board of Directors of the Company at its Meeting held on 28th
May, 2022, on the recommendation of the Audit Committee, have made its recommendation to
the Members for re-appointment of Messrs B S R & Co. LLP, Chartered Accountants (Firm
Registration Number 101248W/W-100022), who have given a written consent to act as
Statutory Auditors of your Company and have also confirmed that the said appointment would
be in conformity with the provisions of sections 139 and 141 of the Companies Act, 2013
read with the Companies (Audit and Auditors) Rules, 2014, to hold office for
a second term of 5 (five) consecutive years from the conclusion of the
ensuing AGM, until the conclusion of the 81st AGM of the Company to be held in
the year 2027.
The Members are requested to re-appoint Messrs B S R & Co. LLP as
Statutory Auditors of the Company at the ensuing Annual General Meeting for a second term
of 5 (five) consecutive years from the conclusion of the ensuing Annual General Meeting
till the conclusion of the 81st Annual General Meeting and fix their
remuneration.
The Auditors' Report for FY 2021-22 is unmodified i.e. it does not
contain any qualification, reservation or adverse remark or disclaimer.
Secretarial Auditor
Pursuant to the provisions of section 204 of the Companies Act, 2013
and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the
Company has appointed Mr. Sachin Bhagwat, Practicing Company Secretary (Certificate of
Practice Number: 6029) to undertake the Secretarial Audit of the Company.
The Company has annexed to this Board's Report as Annexure III, a
Secretarial Audit Report for the Financial Year 2021-22 given by the Secretarial Auditor.
The Secretarial Audit Report does not contain any qualification,
reservation or adverse remark or disclaimer.
Annual Secretarial Compliance Report
The Company has undertaken an audit for the Financial Year 2021-22 for
all applicable compliances as per SEBI Regulations and Circulars/Guidelines issued
thereunder. The Annual Secretarial Compliance Report duly signed by Mr. Sachin Bhagwat has
been submitted to the Stock Exchanges and is annexed at Annexure IV to this Board's
Report.
Secretarial Audit of Material Unlisted Indian
Subsidiary
During the year, Mahindra Vehicle Manufacturers Limited
("MVML"), ceased to be a material subsidiary of the Company with effect from 1st
July, 2021. There is no Material Unlisted Indian Subsidiary of the Company as on 31st
March, 2022 and as such the requirement under Regulation 24A of the Listing Regulations
regarding the Secretarial Audit of Material Unlisted Indian Subsidiary is not applicable
to the Company for the Financial Year 2021-22.
Cost Auditors
The Board had appointed Messrs D. C. Dave & Co., Cost Accountants
(Firm Registration Number 000611), as Cost Auditor for conducting the audit of cost
records of the Company for the Financial Year 2021-22.
The Board of Directors on the recommendation of the Audit Committee,
appointed Messrs D. C. Dave & Co., Cost Accountants (Firm Registration Number 000611),
as the Cost Auditors of the Company for the Financial Year 2022-23 under section 148 of
the Companies Act,
2013. Messrs D. C. Dave & Co. have confirmed that their appointment
is within the limits of section 141(3)(g) of the Companies Act, 2013 and have also
certified that they are free from any disqualifications specified under section 141(3) and
proviso to section 148(3) read with section 141(4) of the Companies Act, 2013.
The Audit Committee has also received a Certificate from the Cost
Auditors certifying their independence and arm's length relationship with the Company.
As per the provisions of the Companies Act, 2013, the remuneration
payable to the Cost Auditor is required to be placed before the Members in a General
Meeting for their ratification. Accordingly, a Resolution seeking Members' ratification
for the remuneration payable to Messrs D. C. Dave & Co., Cost Auditors is included in
the Notice convening the Annual General Meeting.
Cost Records
As per Section 148 of the Companies Act, 2013, read with the Companies
(Cost Records and Audit) Rules,
2014, your Company is required to maintain cost records and
accordingly, such accounts and records are maintained.
Reporting of Frauds by Auditors
During the year under review, the Statutory Auditors, Cost Auditors and
Secretarial Auditor have not reported any instances of frauds committed in the Company by
its Officers or Employees to the Audit Committee under section 143(12) of the Companies
Act, 2013.
Particulars of the loans given, investment made or guarantee given or
security provided and the purpose for which the loan or guarantee or security is proposed
to be utilised by the recipient of the loan or guarantee or security are provided in Note
Nos. 8 and 40 to the Financial Statements.
Your Company had discontinued acceptance of Fixed Deposits with effect
from 1st April, 2014.
All the deposits from public and shareholders had already matured as on
31st March, 2017. All the 17 outstanding deposits aggregating Rs. 7.49 lakhs
from the public and shareholders as on 31st March, 2022 had matured and had not
been claimed as at the end of the Financial Year. Since then no deposits have been
claimed.
There was no default in repayment of deposits or payment of interest
thereon during the year under review. There are no deposits which are not in compliance
with the requirements of Chapter V of the Companies Act, 2013.
The particulars of loans/advances/investments, etc., required to be
disclosed pursuant to Para A of Schedule V of the Listing Regulations are furnished
separately in this Annual Report.
The transaction(s) of the Company with a company belonging to the
promoter/promoter group which hold(s) more than 10% shareholding in the Company as
required pursuant to para A of Schedule V of the Listing Regulations is disclosed
separately in the Financial Statements of the Company.
Key Managerial Personnel (KMP)
The following have been designated as the Key Managerial Personnel of
the Company pursuant to Sections 2(51) and 203 of the Companies Act, 2013 read with the
Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014:
(a) Dr. Anish Shah - Managing Director and CEO (re-designated with
effect from 2nd April, 2021)
(b) Mr. Rajesh Jejurikar - Executive Director (Automotive & Farm
Sectors)
(c) Mr. Manoj Bhat - Group Chief Financial Officer (appointed with
effect from 2nd April, 2021)
(d) Mr. Narayan Shankar - Company Secretary
Dr. Pawan Goenka ceased to be the Managing Director and CEO as well as
the Director of the Company with effect from 2nd April, 2021. Dr. Anish Shah
was re-designated as Managing Director and CEO of the Company and ceased to be the Deputy
Managing Director and Group Chief Financial Officer of the Company, with effect from 2nd
April, 2021.
Further, Mr. Anand G. Mahindra transitioned to the role of
Non-Executive Chairman of the Company with effect from 12th November, 2021 upon
completion of his tenure as the Executive Chairman of the Company and consequently ceased
to be a Key Managerial Personnel of the Company.
Employees' Stock Option and Employees'
Welfare Schemes
During the year under review, on the recommendation of the Governance,
Nomination and Remuneration Committee (GNRC) of your Company, the Trustees of Mahindra
& Mahindra Employees' Stock Option Trust have granted Stock Options to employees under
the Mahindra & Mahindra Limited Employees Stock Option Scheme 2010. No Stock Options
have been granted to employees under the Mahindra & Mahindra Limited Employees Stock
Option Scheme 2000 (2000 Scheme).
The Company has in force the following Schemes which get covered under
the provisions of SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021
(SBEB Regulations 2021):
1. Mahindra & Mahindra Limited Employees Stock Option Scheme - 2000
(2000 Scheme)*
2. Mahindra & Mahindra Limited Employees Stock Option Scheme - 2010
(2010 Scheme)
3. M&M Employees Welfare Fund No. 1
4. M&M Employees Welfare Fund No. 2
5. M&M Employees Welfare Fund No. 3
* No outstanding options as on 31st March, 2022
There were no changes made to the above Schemes except alignment of
2010 Scheme with the SBEB Regulations 2021. The above-mentioned Schemes are in compliance
with the SBEB Regulations 2021. Your Company's Secretarial Auditor, Mr. Sachin Bhagwat,
has certified that the Company's above-mentioned Schemes have been implemented in
accordance with the SBEB Regulations 2021, and the Resolutions passed by the Members for
the 2000 Scheme and the 2010 Scheme.
Information as required under Regulation 14 read with Part F of
Schedule I of the SBEB Regulations 2021 has been uploaded on the Company's website and can
be accessed at the Web-link: https://www.mahindra.com/resources/FY22/AnnualReport.zip.
Particulars of Employees and related disclosures
The Company had 389 employees who were in receipt of remuneration of
not less than Rs. 1,02,00,000 during the year ended 31st March, 2022 or not
less than Rs. 8,50,000 per month during any part of the year.
Details of employee remuneration as required under provisions of
Section 197(12) of the Companies Act, 2013 read with Rule 5(2) & 5(3) of the Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014 will be made available
during 21 days before the Annual General Meeting in electronic mode to any Shareholder
upon request sent at agm.inspection@mahindra.com. Such details are also available on your
Company's website and can be accessed at the Web-link:
https://www.mahindra.com/resources/FY22/AnnualReport.zip.
Disclosures with respect to the remuneration of Directors, KMPs and
employees as required under Section 197(12) of the Companies Act, 2013 read with Rule 5(1)
of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are
given in Annexure V to this Report.
Industrial Relations
The year under review witnessed a very positive Industrial Relations
Scenario across all manufacturing locations for the Automotive and Farm Equipment Sectors
even during the toughest time of Pandemic.
Your Company's focus continues towards propagating proactive and
employee centric practices. The transformational work culture initiative that aims to
create an engaged workforce with an innovative, productive and a competitive shop-floor
ecosystem continues to grow in strength. Some examples of the programs put in place
includes 'Rise for Associates', industrial relations skills for frontline officers,
Employee of the year, e-compliance,e-portal for reward and recognition of associates and
Code of Conduct for associates. The Employee Relations Council is taking forward the work
of Transformational Work Culture Committee (TWCC) and leads the design and implementation
of these programs and reviews its progress.
With the objective of capability building, developing future ready
workforce and fostering togetherness at the workplace, your Company implements multiple
training and engagement programs on an ongoing basis. These include various behavioral and
functional programs such as safety and environment, quality tools, TPM, continuous
improvement, result orientation, relationship management, decision making and programs on
skill building. In its continuous endeavor in employee lifecycle processes, your Company
has launched-Employee Connect Centre (ECC) digital form of traditional time office and
payroll for ease of access to associates, Success Factors & Learning Management System
for associates to enable self-paced learning on a digital space.
The Mahindra Skill Excellence initiative, a holistic approach to
enhance the skill and capabilities of shop floor associates, is receiving good
participation across manufacturing facilities.
One of your Company's associates from MRV Chennai won the silver medal
in IndiaSkills Competition. The Mahindra Parivaar including dealers has won all the top
three positions in the Automobile Technology Category at IndiaSkills, New Delhi held from
6th to 10th January 2022. One among them would be representing the
Company at the World Skills Competition to be held at Shanghai, China, in October later
this year. In an endeavor to improve quality, reduce cost, ensure safety, and improve
productivity, your Company's shop floor associates managed to generate on an average 10
ideas per person in the Financial Year 2022 even during the time of uncertainties.
This year significant emphasis was also laid towards raising awareness
on health and wellness of employees and their family members on protection from COVID-19
under the brand program "Swasth Raho Mast Raho" over Google Teams platform in
addition to regular annual medical check-ups and health awareness activities. Diet food
has become a way of life over the past four years. The Company maintains an 'Employee
Health Index' at an individual level, and this has been a useful tool in identifying
employees who require focussed counselling and monitoring.
Proactive and employee-centric shop floor practices, a focus on
transparent communication of business goals, an effective concern resolution mechanism,
and a firm belief that employees are the most valuable assets of the Company, are the
cornerstone of your Company's employee relations approach. An 'open door policy' with
constant dialogue to create win- win situations, have helped your Company build trust and
harmony.
The industrial relations scenario continued to be largely positive
across all the manufacturing locations. Long term settlements and bonus settlements were
amicably agreed upon at all locations. The sustained efforts towards building a
transformational work culture resulted in zero production loss in the Financial Year
2021-22 and helped create a collaborative, healthy and productive work environment.
Safety, Occupational Health and Environment
Your Company has in place the Safety, Occupational Health &
Environment (SOH&E) Policy. During the year under review, the Company started external
virtual assessment and recertification as per the standard, ISO: 45001: 2018. The
management commitment towards SOH&E is demonstrated through adoption of new compliance
management digitization which included all notifications published during the pandemic
period. The Company implemented various initiatives by incorporating all Government
released guidelines with overall health and hygiene being merged with the SOH&E
policy. The achievements were assessed through management reviews from time to time.
At each Plant location, annual events like Road Safety Week, National
Safety Day/Month and Fire Service Week were organized virtually. As per new normal,
various new topics were deployed to train employees on Safety, Health and Environment.
Along with the virtual meetings, dexterity competency training programs were deployed for
associates, with special focus on safety and fire safety by introducing Self-Managed Teams
(SMT's). The training programs were leveraged by on- the-job training (OJT) and virtual
reality (V.R.) programs supporting various safety topics to enhance learning.
To strengthen the safety best practices, the Company continues to focus
on theme-based safety topics arising out of OHS hazards and immediate corrective action as
well as permanent corrective actions are implementedwith agility. Continuous drive is
taken to enhance Behavior Based Safety (BBS) Level 2. Additionally, your Company
introduced new fire protection system by upgrading and introducing new technology to
eliminate property losses. Results were monitored by reviewing office fire prevention and
protection. Fire load reduction is monitored by setting up targets and working towards
sustenance of zero fire incidence across each manufacturing location in each Sector.
Your Company has followed the assessment by evaluation for
implementation through The Mahindra Safety Way (TMSW). For this evaluation process, total
25 parameters are assessed for the Mahindra Group companies across all the plants.
Your Company carried out Management of change process, Gap audit
process, HAZOP analysis for each license storage premises which is audited by competent
persons apart from statutory Safety, Fire Safety, Electrical Safety Audits. For the year
under review, your Company achieved substantial reduction in the results of lag
indicators, first aid incidences by adopting new initiatives. Focussed drive was taken on
critical machinery and equipments. Plastic elimination and recyclable packaging material
in more and more spares is initiated by substituting the material as appropriate.
To eliminate and minimize the overall environmental impact in line with
the "Environmental, Social and Governance" (ESG) practices, your Company has
continuously implemented new projects. By revisiting the objectives, newer targets were
revised. New techniques used in various projects have been implemented by your Company in
zero carbon emission, waste avoidance/ minimization. Carbon footprint reduction is
achieved by deploying new energy conservation motors and increasing share of renewable
energy. Many of the Company's new initiatives have been shared by your Company with the
supplier community to encourage their consultation and participation in line with current
and future environmental challenges.
During the year under review, your Company started reporting the
implementation status under Extended Producer Responsibility Organizations (EPRO) with
newly set targets established by Central Government i.e. Central Pollution Control Board
by way of released new amended notification. Plastic waste management activities cover pan
India network developed for plastic waste recycling management for all the Company's
manufacturing plantsand spares business units are also involved with state wise clusters
for its Suppliers and Dealers.
Your Company implemented various measures towards water neutrality and
achieved reduction in consumption of freshwater requirement. By demonstrating
implementation measures, a marked improvement has been observed in ground water recharging
and water recycling.
Your Company continued its commitment to improve the well-being of
employees and contract associates through various activities. Education and awareness
sessions were conducted on enhancement of physical and mental health. Also, through
virtual platform "Swasth Raho Mast Raho" programs are being conducted by
renowned faculties for Mahindra family members. Further, vaccination drive was conducted
in each plant premises to facilitate the vaccination for employees and their family
members. Health magazine was published "Health in COVID era" to demonstrate
excellence in occupational health.
Additionally, the Company has initiated a stage-wise physiotherapy
study to improve ergonomics at the operational stages working towards fatigue elimination
at workplace. Videos were created to improve their posture observed at shop floor. First
aid refresher training programs were organized for employees and associates.
Your Company has taken care of all the employees of Mahindra Group
companies in the pandemic and various activities were conducted by way of medical
check-up, vaccination drive, webinar for all the employees and their family members.
Consultation and counselling on pandemic illness, advisory publishing, for all employees
and family members were also completed. Robust implementation of compliance for
Bio-medical Waste Disposal Management as per pandemic notifications was also carried out.
In addition, environment protection awareness is generated virtually
amongst all stakeholders on an annual basis for World Ozone Day, World Environment Day,
World Earth Day, World Water Day and Energy Conservation Week and Water Conservation Week,
etc.
Certifications/Recertifications
All Plants of your Company are re-certified for Standard ISO 45001:
2018 and ISO 14001: 2015. Further, all plantshave implemented Integrated Management System
(IMS). Your Company is certified for Zero Waste to Landfill with 99% and above conversion
rate which ensures the commitment of recycling of waste at maximum extent to protect the
environment.
The Senior Management revises and reviews the performances
periodically. Focus on new initiatives involving all stakeholders coupled with management
reviews have helped your Company to demonstrate excellence in SOH&E performance.
Directors
As mentioned in the previous Annual Report, Dr. Pawan Goenka ceased to
be the Managing Director and Chief Executive Officer of the Company with effect from 2nd
April, 2021. Dr. Goenka also ceased to be a Member of the Board of Directors of the
Company with effect from 2nd April, 2021.
In terms of the Succession Planning approved by the Governance,
Nomination and Remuneration Committee and Board of your Company, Dr. Anish Shah took over
as the Managing Director and Chief Executive Officer of the Company with effect from 2nd
April, 2021.
Mr. Anand G. Mahindra transitioned to the role of Non-Executive
Chairman of the Company with effect from 12th November, 2021 upon completion of
his tenure as the Executive Chairman of the Company.
Ms. Nisaba Godrej and Mr. Muthiah Murugappan were appointed as
Independent Directors of the Company for a term of 5 (five) consecutive years commencing
from 8th August, 2020 to 7th August, 2025.
Mr. T.N. Manoharan was re-appointed as an Independent Director of the
Company for a second term of 5 (five) consecutive years commencing from 11th
November, 2021 to 10th November, 2026.
Padma Bhushan Award to Mr. Anand G. Mahindra,
Chairman
Mr. Anand G. Mahindra, Chairman of the Company was conferred with one
of the highest civilian honour "Padma Bhushan" Award for 2020
("Award") for his distinguished service of high order in the field of Trade and
Industry. The Award which had been conferred on 26th January, 2020 was received
by him on 8th November, 2021 from the President of India at Rashtrapati Bhavan
in New Delhi.
The Chairman of the Company has expressed gratitude towards all the
Mahindraites and Stakeholders who embraced the Rise philosophy and made this possible.
Independent Directors
The Company has received declarations from all the Independent
Directors of the Company confirming that they meet the criteria of independence as
prescribed both under the Companies Act, 2013 and Listing Regulations. Further, pursuant
to the SEBI (Listing Obligations and Disclosure Requirements) (Third Amendment)
Regulations, 2021 dated 3rd August, 2021 read with Corrigendum dated 6th
August, 2021 amending the definition of Independent Director under Listing Regulations
with effect from 1st January, 2022, a confirmation had been obtained from all
the Independent Directors of the Company that they meet the revised criteria of
Independence as of 1st January, 2022.
The Board is of the opinion that the Independent Directors of the
Company hold highest standards of integrity and possess requisite expertise and experience
required to fulfill their duties as Independent Directors.
In terms of Section 150 of the Companies Act, 2013 read with Rule 6 of
the Companies (Appointment and Qualification of Directors) Rules, 2014, Independent
Directors of the Company have confirmed that they have registered themselves with the
databank maintained by The Indian Institute of Corporate Affairs, Manesar ('IICA'). The
Independent Directors are also required to undertake online proficiency self-assessment
test conducted by IICA within a period of 2 (two) years from the date of inclusion of
their names in the data bank, unless they meet the criteria specified for exemption.
The Independent Directors of the Company are exempt from the
requirement to undertake online proficiency self-assessment test except Mr. Muthiah
Murugappan who would be undertaking the said test in due course.
Lead Independent Director
Mr. Vikram Singh Mehta, Independent Director and Chairman of
Governance, Nomination and Remuneration Committee has been appointed as the Lead
Independent Director with effect from 1st April, 2021. The role and
responsibilities of the Lead Independent Director are provided in the Corporate Governance
Report forming part of this Annual Report.
Retirement by rotation
Dr. Anish Shah and Mr. Rajesh Jejurikar retire by rotation and, being
eligible, offer themselves for re-appointment at the 76th Annual General
Meeting of the Company scheduled to be held on 5th August, 2022.
Board Evaluation
Pursuant to the provisions of the Companies Act, 2013 and the Listing
Regulations, the Board has carried out an annual evaluation of its own performance and
that of its Committees as well as performance of all the Directors individually, including
Independent Directors, Chairman of the Board, Managing Director & Chief Executive
Officer and Executive Director (Automotive & Farm Sectors).
I Feedback Mechanism
Feedback was sought by way of a structured questionnaire covering
various aspects of the Board's functioning such as adequacy of the composition of the
Board and its Committees, Board Culture, Execution and Performance of Specific Duties,
Obligations and Governance and the evaluation was carried out based on responses received
from the Directors.
Evaluation of Committees
The performance evaluation of Committees was based on criteria such as
structure and composition of Committees, attendance and participation of member of the
Committees, fulfilment of the functions assigned to Committees by the Board and applicable
regulatory framework, frequency and adequacy of time allocated at the Committee Meetings
to fulfil duties assigned to it, adequacy and timeliness of the Agenda and Minutes
circulated, comprehensiveness of the discussions and constructive functioning of the
Committees, effectiveness of the Committee's recommendation for the decisions of the
Board, etc.
Evaluation of Directors and Board
A separate exercise was carried out by the Governance, Nomination and
Remuneration Committee of the Board to evaluate the performance of Individual Directors.
The performance evaluation of the Non-Independent Directors and the Board as a whole was
carried out by the Independent Directors. The performance evaluation of the Chairman of
the Board was also carried out by the Independent Directors, taking into account the views
of the Executive Directors and Non Executive Directors. The performance evaluation of the
Managing
Director and the Executive Director of the Company was carried out by
the Chairman of the Board and other Directors.
Criteria for Independent Directors
The performance evaluation of Independent Directors was based on
various criteria, inter alia, including attendance at Board and Committee Meetings, skill,
experience, ability to challenge views of others in a constructive manner, knowledge
acquired with regard to the Company's business, understanding of industry and global
trends, etc.
Criteria for Chairman
The performance evaluation of Chairman of the Board was based on
various criteria, inter alia, including style of Chairman's leadership, effective
engagement with other Board members during and outside the meetings, allocation of time
provided to other Board members at the meetings, effective engagement with shareholders
during general meetings, etc.
Criteria for Managing Director and Executive Director
The performance evaluation of Managing Director and Executive Director
was based on various criteria, inter alia, including leadership style, standards of
integrity, fairness and transparency demonstrated, identification of strategic targets,
anticipation of future demands and opportunities, resource staffing to meet short term and
long term goals, engagement with Board and Committee members, updating Board on
significant issues, commitment to organisational values, vision and mission, adaptation to
meet changing circumstances, knowledge and sensitivity of stakeholders' needs within and
outside the Company demonstrated and effective communication skills.
Results of Evaluation
The results of evaluation showed high level of commitment and
engagement of Board, its various committees and senior leadership. The results of the
evaluation were shared with the Board, Chairman of respective Committees and individual
Directors. Based on the outcome of the evaluation, the Board has agreed on an action plan
to further improve the effectiveness and functioning of the Board and Committees.
The Directors expressed their satisfaction with the evaluation process.
During the year under review, the Committee ascertained and reconfirmed that the
deployment of "questionnaire" as a methodology, is effective for evaluation of
performance of Board and Committees and Individual Directors.
Policies
Your Company has adopted the following Policies which, inter alia,
include criteria for determining qualifications, positive attributes and independence of a
Director:
(a) Policy on Appointment of Directors and Senior Management and
succession planning for orderly succession to the Board and the Senior Management;
(b) Policy for remuneration of the Directors, Key Managerial Personnel
and other employees.
Policy (a) mentioned above includes the criteria for determining
qualifications, positive attributes and independence of a Director, identification of
persons who are qualified to become Directors and who may be appointed in the Senior
Management Team in accordance with the criteria laid down in the said Policy, succession
planning for Directors and Senior Management, and Policy statement for Talent Management
framework of the Company. The Policy was modified to align with the amendments made to the
Listing Regulations effective from 1st January, 2022.
Further, to strengthen the disclosures on Corporate Governance, the
Policy was amended to include the following three Annexures:
• Policy on Board Membership Criteria;
• The Board Diversity Policy;
• Policy on Criteria for determining Independence of Directors.
Policy (b) mentioned above sets out the approach to Compensation of
Directors, Key Managerial Personnel and other employees in the Company.
Policies mentioned at (a) and (b) above are available on the website
and can be accessed in the Governance section at the Web-link:
https://www.mahindra.com/investors/reports-and-filings.
Familiarisation Programme for Independent
Directors/Non-Executive Directors
The Members of the Board of the Company are afforded many opportunities
to familiarise themselves with the Company, its Management and its operations. The
Directors are provided with all the documents to enable them to have a better
understanding of the Company, its various operations and the industry in which it
operates.
All the Independent Directors of the Company are made aware of their
roles and responsibilities at the time of their appointment through a formal letter of
appointment, which also stipulates various terms and conditions of their engagement.
Executive Directors and Senior Management provide an overview of the
operations and familiarize the new NonExecutive Directors on matters related to the
Company's values and commitments. They are also introduced to the organization structure,
constitution of various committees, board procedures, risk management strategies, etc.
Strategic Presentations are made to the Board where Directors get an
opportunity to interact with Senior Management. Directors are also informed of the various
developments in the Company through Press Releases, emails, etc.
The Company has a web based portal i.e. Board portal, accessible to all
the Directors which, inter alia, contains the following information:
• Roles, responsibilities and liabilities of Independent Directors
under the Companies Act, 2013 and the Listing Regulations
• Board Minutes, Agenda and Presentations
• Annual Reports
• Code of Conduct for Directors
• Terms and conditions of appointment of Independent Directors.
Pursuant to Regulation 25(7) of the Listing Regulations, the Company
imparted various familiarization programmes for its Directors including review of
Investments of the Company by Strategic Investment Committee, Industry Outlook at the
Board Meetings, Regulatory updates at Board and Audit Committee Meetings covering changes
with respect to the Companies Act, 2013, Listing Regulations, Taxation and other matters,
Presentations on Internal Control over Financial Reporting, Operational Control over
Financial Reporting, Prevention of Insider Trading Regulations, Framework for Related
Party Transactions, Plant Visit, Meeting with Senior Executive(s) of your Company,
Corporate Social Responsibility Strategy etc. Pursuant to Regulation 46 and 62(1A) of the
Listing Regulations, the details required are available on the website of your Company at
the web link: https://www.mahindra.com/resources/FY22/AnnualReport.zip.
Directors' Responsibility Statement
Pursuant to section 134(5) of the Companies Act, 2013, your Directors,
based on the representations received from the Operating Management, and after due
enquiry, confirm that:
(a) i n the preparation of the annual accounts for the Financial Year
ended 31st March, 2022, the applicable accounting standards have been followed;
(b) they had in consultation with Statutory Auditors, selected
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 at 31st March, 2022 and of the profit of the Company for the
year ended on that date;
(c) they have taken proper and sufficient care for the maintenance of
adequate accounting records in accordance with the provisions of the Companies Act, 2013
for safeguarding the assets of the Company and for preventing and detecting fraud and
irregularities;
(d) they have prepared the annual accounts on a going concern basis;
(e) they have laid down adequate Internal Financial Controls to be
followed by the Company and such Internal Financial Controls were operating effectively
during the Financial Year ended 31st March, 2022;
(f) they had devised proper systems to ensure compliance with the
provisions of all applicable laws and that such systems were adequate and operating
effectively throughout the Financial Year ended 31st March, 2022.
Board Meetings and Annual General Meeting
A calendar of Meetings is prepared and circulated in advance to the
Directors.
During the year 1st April, 2021 to 31st March,
2022, six Board Meetings were held on: 29th April, 2021, 28th May,
2021, 6th August, 2021, 9th November, 2021, 10th and 11th
February, 2022 and 15th March, 2022. The 75th Annual General Meeting
(AGM) of the Company was held on 6th August, 2021 through Video
Conferencing/Other Audio Visual Means.
Meetings of Independent Directors
The Independent Directors of your Company meet before the Board
Meetings without the presence of the Chairman of the Board or the Managing Director or the
Executive Director or other Non-Independent Directors or Chief Financial Officer or any
other Management Personnel.
These Meetings are conducted in an informal and flexible manner to
enable the Independent Directors to discuss matters pertaining to, inter alia, review of
performance of Non-Independent Directors and the Board as a whole, review the performance
of the Chairman of the Company (taking into account the views of the Executive and
Non-Executive Directors), assess the quality, quantity and timeliness of flow of
information between the Company Management and the Board that is necessary for the Board
to effectively and reasonably perform their duties.
Five Meetings of Independent Directors were held during the year and
these meetings were well attended.
Audit Committee
The Committee comprises of four Directors viz. Mr. T. N. Manoharan
(Chairman of the Committee), Ms. Shikha Sharma, Mr. Vikram Singh Mehta and Mr. Haigreve
Khaitan. All the Members of the Committee are Independent Directors and possess strong
accounting and financial management knowledge. The Company Secretary of the Company is the
Secretary of the Committee.
During the year, the scope of Audit Committee was amended to,
inter-alia, align with the provisions of SEBI (Listing Obligations and Disclosure
Requirements) (Second Amendment) Regulations, 2021, the details of which are furnished in
the Report on Corporate Governance that forms part of this Annual Report.
All the recommendations of the Audit Committee were accepted by the
Board.
Winding-up of Loans & Investment Committee of
the Company
The Board of Directors of your Company at its Meeting held on 10th
and 11th February, 2022 as part of simplification process, considered and
approved the winding-up of the Loans & Investment Committee with effect from 10th
February, 2022.
Corporate Governance
Your Company has a rich legacy of ethical governance practices many of
which were implemented by the Company, even before they were mandated by law. Your Company
is committed to transparency in all its dealings and places high emphasis on business
ethics.
Your Company featured in the 'Leadership' category in the Corporate
Governance Scorecard 2021 which is developed by Institutional Investor Advisory Services
India Limited ('IiAS') with support from International Finance Corporation ('IFC') and BSE
Limited ('BSE'). Further, your Company received the prestigious 'Golden Peacock Global
Award for Excellence in Corporate Governance' for the year 2021.
A Report on Corporate Governance along with a Certificate from the
Statutory Auditors of the Company regarding compliance with the conditions of Corporate
Governance as stipulated under Schedule V of the Listing Regulations forms part of this
Annual Report.
Code Of Conduct
Your Company's Code of Conduct (the Code) outlines the commitment to
principles of integrity, transparency and fairness that employees, suppliers, distributors
and other third parties who work with the Company must comply. The Code of Conduct enables
every person working for and with the Company to make the right choices and demonstrate
the highest standards of integrity and ethical behaviour. It is translated in 4 regional
languages and is available on the Company's website and can be accessed on the website in
the Governance section at the Web-link:
https://www.mahindra.com/investors/reports-and-filings.
All the policies are accessible through the Rise@Work on the Company's
intranet as well as on the mobile app Me-connect.
The Ethics & Governance framework is also anchored by clearly
defined policies and procedures, covering areas such as Anti-Bribery and Anti-Corruption
(ABAC), Policy on Gifts & Entertainment, Prevention of Sexual Harassment at Workplace
(POSH) and Whistle Blower Policy.
The Company has put in place an implementation framework through annual
awareness program. All new joiners are required to undertake on-line training of the Code,
POSH and ABAC on joining the employment. For reinforcing Code and Policies, all employees
are further required to complete mandatory e-Learning refresher training, annually. In
addition to this, an annual Compliance module is mandated to all employees. Your Company
has a stellar support of 150 Ethics Counsellors who help in a continuous cycle of
effective communication of Code and Policies with their cohorts.
The processes for identifying and resolving breaches of the Code and
Policies are clearly defined and regularly communicated throughout the Company. Data
relating to such breaches is reviewed by the Corporate Governance Council and by relevant
Board Committees that helps to determine the allocation of resources for future Policy
development, process improvement, training and awareness initiatives. The Corporate
Governance Council ensures that the Ethics & Governance framework is executed
effectively. The Group Ethics and Governance Committee and Business Ethics and Governance
Committees help to ensure that the decisions are taken in fair, just and consistent manner
across various functions of that business.
Vigil Mechanism
The Vigil Mechanism as envisaged in the Companies Act, 2013, the Rules
prescribed thereunder and the Listing Regulations is implemented through the Company's
Whistle Blower Policy to enable the Directors, employees and all stakeholders of the
Company to report genuine concerns (about unethical behaviour, actual or suspected fraud,
or violation of the Code), to provide for adequate safeguards against victimisation of
persons who use such mechanism and make provision for direct access to the Chairman of the
Audit Committee. A quarterly report on the whistle blower complaints received is placed
before the Audit Committee for its review.
The Whistle Blower Policy was updated during the year, the details of
which may be referred to in Annexure VIII of this Board's Report. Whistle Blower Policy of
your Company is available on the Company's website and can be accessed in the Governance
section at the Web-link: https://www.mahindra.com/investors/reports-and-filings.
The Sexual Harassment of Women at Workplace
(Prevention, Prohibition and Redressal) Act, 2013
The Company has a detailed Policy on Prevention of Sexual Harassment
(POSH Policy) in place in line with the requirements of The Sexual Harassment of Women at
Workplace (Prevention, Prohibition and Redressal) Act, 2013 (Act). Internal Complaints
Committees (ICC) have been set up to redress complaints received regarding sexual
harassment and the Company has complied with provisions relating to the constitution of
ICC under the Act. All employees (permanent, contractual, temporary, trainees) are covered
under this Policy. The POSH Policy is gender inclusive, and the framework ensures complete
anonymity and confidentiality. The POSH Policy was updated during the year, the details of
which may be referred to in Annexure VIII of this Board's Report.
While maintaining the highest governance norms, the various ICC have
appointed internal members with 50% being women and external members with relevant
experience. The ICC is presided by a senior woman employee in each case. The ICC has been
updated on judicial trends and trained regularly on the nuances of the Act.
During the year under review, 9 complaints with allegations of sexual
harassment were filed and 7 were resolved as per the provisions of the Act. 2 complaints
are pending as of 31st March, 2022.
Awareness in this area has been created vide Speak Up campaign with
focus on virtual workings and reiterating Mahindra's commitment for providing safe
workplace to all its employees. The Company has organised induction training for new
joiners, online training and refresher modules, virtual and classroom trainings by Ethics
Counsellors, emailers and posters to sensitise the employees to conduct themselves in a
professional manner.
Business Responsibility Report
The 'Business Responsibility Report' (BRR) of your Company for the
Financial Year 2021-22 forms part of this Annual Report as required under Regulation
34(2)(f) of the Listing Regulations.
Your Company strongly believes that sustainable and inclusive growth is
possible by using the levers of environmental and social responsibility while setting
aspirational targets and improving economic performance to ensure business continuity and
rapid growth.
Your Company is committed to leverage 'Alternative Thinking' to build
competitive advantage in achieving high shareholder returns through customer centricity,
innovation, good governance and inclusive human development while being sensitive to the
environment.
Risk Management
Your Company has a well-defined risk management framework in place. The
risk management framework works at various levels across the enterprise. These levels form
the strategic defence cover of the Company's risk management. The Company has a robust
organizational structure for managing and reporting on risks.
Your Company has constituted a Risk Management Committee of the Board
which is authorized to monitor and review risk management plan and risk certificate. The
Committee is also empowered, inter alia, to review and recommend to the Board
modifications to the Risk Management Policy. Further, the Board has constituted a
Corporate Risk Council comprising the Senior Executives of the Company. The terms of
reference of the Council include review of risks and Risk Management Policy at periodic
intervals. During the year under review, the terms of reference of the Risk Management
Committee and the Risk Management Policy were amended by the Board pursuant to the Listing
Regulations.
Your Company has developed and implemented a Risk Management Policy
which is approved by the Board. The Risk Management Policy, inter alia, includes
identification of risks, including cyber security and related risks and also those which
in the opinion of the Board may threaten the existence of the Company. Risk management
process has been established across the Company and is designed to identify, assess and
frame a response to threats that affect the achievement of its objectives. Further, it is
embedded across all the major functions and revolves around the goals and objectives of
the organization.
Corporate Social Responsibility (CSR)
Over the past seven decades, your Company has built its reputation as a
good corporate citizen by not only doing good business, but also by driving positive
change in society. The core purpose of your Company is to "challenge conventional
thinking and innovatively use all our resources to drive positive change in the lives of
our stakeholders and communities across the world, to enable them to RISE". Keeping
the core purpose in mind, your Company has invested in impactful CSR projects.
This year too was a challenging year for humanity, with the adverse
impact of the COVID-19 pandemic being felt by one and all, but more so by vulnerable and
marginalized groups on whom the impact has been the hardest. Your Company has invested in
a concerted manner to provide COVID-19 relief and rehabilitation with an aim of building
resilient communities. The Mahindra Group swiftly responded to the pandemic by putting
into action a series of relief initiatives across 23 States and Union Territories. The
State and District administration and hospitals were provided with 23 Oxygen Plants, 866
Oxygen Concentrators and 94 Ambulances by the Group. The Group also distributed over
2,37,750 cooked meals and provided ration and other essentials to over 3,66,090
beneficiaries. The frontline workers were supported through distribution of over 2,75,050
protective gears such as face masks, face shields, gloves, PPE kits, etc. and 8,450 litres
of sanitizer. Infrastructural support and consumables were provided to over 40 hospitals
across the country and the capacity of COVID Care centre in Pune MHADA was further
augmented.
Your Company also supported Mass scale Preventive actions for COVID-19
transmission (IMPACT) program in 600 villages in Araku, Andhra Pradesh. Apart from raising
awareness, the project ensured that thermal screening was carried out in the villages
thereby leading to early detection and immediate treatment through provision of drugs
under medical supervision. A similar program was implemented in partnership with Aatapi
Seva Foundation for marginalized communities in 25 villages of Bharuch, Gujarat. 700 Front
line workers
were also provided with a self-contained kit consisting of a pulse
oximeter, basic protective equipment, and supplementary information communication material
to protect and provide the health safety net to more than 4,00,000 people in rural India.
Your Company has continued to support the constituencies of girls,
youth and farmers through projects in the domains of education, health and the
environment. This year your Company made special effort in empowering women both in urban
and rural areas. By investing CSR efforts in these critical constituencies who contribute
to nation building and the economy, your Company will enable our stakeholders and
communities to RISE. The impact of some of the CSR projects your Company invested in
Financial Year 2021-22 are shown below:
- Project Nanhi Kali supported the education of 1,85,759
underprivileged girls through 7,049 Academic Support Centres across 20 Districts in 9
States of India. Of these, your Company continued to support 38,096 girls, which includes
an additional 5,050 girls enrolled in Financial Year 2021-22, while the Mahindra Group as
a whole continued to support 83,591 girls. Despite COVID-19 restrictions, this project
ensured continuous learning for girl children.
- Mahindra Pride: Mahindra Pride continued to enhance employability
skills of youth from socially and economically disadvantaged backgrounds through Mahindra
Pride Schools and Mahindra Pride Classrooms. In Financial Year 2021-22, Mahindra Group
facilitated training of 1,798 youth under the Mahindra Pride school programme out of which
1,132 youth were supported through your Company. Similarly, under Mahindra Pride Classroom
intervention, Mahindra Group supported skills enhancement of 1,81,165 youth, out of which
1,13,282 youth were supported through your Company.
- Krishi Mitr Prerna: Through the Krishi Mitr Prerna Projects, your
Company continued to support small and marginal farmers by training them in effective
farming practices and providing advisory services including soil health, access to gender
friendly farm equipment, linkages to Government welfare support initiatives, resource
efficient agriculture methodologies and increasing agricultural incomethrough increasing
crop productivity. The program envisions to develop and empower farmers to meet the demand
supply gap of agricultural produce for self-consumption and market requirements. In
Financial Year 2021-22, the Company supported 20,135 farmers at PAN India level.
- Women Empowerment through Regenerative Agriculture: The main
objective of the programme was to enable women farmers to use regenerative agriculture as
a technique to transform the soil on their land, increase productivity and earn profits
throughout the year, in addition to ensuring food and nutrition security for their
families. Through this project sponsored by your Company, 3,400 women farmers from Moga,
Tarn Taran (Punjab) and Shravasti (Uttar Pradesh) were skilled and provided knowledge in
regenerative organic farming practice. 3 Regenerative Agriculture Hubs have been set up,
each having a demo farm for sharing knowledge on various agricultural practices, training
on various farm tools, equipments and techniques.
- Women's Initiative for Synergistic Empowerment
(WISE): The programme aims at the economic empowerment of women by
promoting enterprises through building entrepreneurial capabilities, financial management
and digital technology with specialization in better marketing of products. As part of the
programme sponsored by your Company, 20,000 SHG members from 14 districts in Maharashtra
and Madhya Pradesh, got an opportunity to explore their entrepreneurship capabilities
through enterprise awareness programmes. The programmes run with a focus on addressing
gender barriers to enterprise. To further support women specifically in branding,
packaging and digital marketing, 12 economic empowerment hubs have been created as part of
the programme.
- Watershed Development: Your Company entered into a Public Private
Partnership (PPP) for a Watershed Development Fund (WDF) and Climate Change Adaptation
(CCA) Program with National Bank for Agriculture and Rural Development (NABARD) in two
locations:- (1) At Hatta, District Damoh, Madhya Pradesh for developing National Priority
Areas of Aspirational District (2) Development of River Basin in Igatpuri Block, Nashik
District,
Maharashtra covering around 30 villages, over area of 15,800 hectares.
During Financial Year 2021-22, your Company supported more than 9,000 farmers through
various interventions of soil and water conservation works, crop diversification measures,
livelihood training/support and drudgery reduction initiatives for Integrated Development
of the rural catchment. In addition, 18,000 people were benefited with availability of
drinking water.
- Mahindra Hariyali: Through this intervention, the Mahindra Group
planted 1.57 million trees, which contributed to building green cover and protecting the
rich biodiversity of the country. Your Company contributed towards plantation of 1.32
million trees out of which 1.11 million trees were planted in the Araku Valley, which
besides greening the environment also provided livelihood support to tribal farmers by
growing coffee and fruit bearing trees in this region. Till date, 20.65 million trees have
been planted through Mahindra Hariyali, of which 13.40 million trees were planted in Araku
which supported livelihood of 25,000 tribal farmer families.
- Employee Volunteering: Despite the challenges posed by the pandemic,
the Company's employees continued to give back to the Society. Through the employee
volunteering platforms (ESOPs and MySeva) 38,803 employees invested 3,62,585 person hours
of their personal time in volunteering activities. Of these 7,718 were Company employees
who contributed 47,133 person hours towards a variety of social causes. At the Group level
1,07,600.50 person hours were invested through individual acts of Social Responsibility
undertaken by Mahindra Group employees which they reported on MySeva Platform. The balance
2,54,984.50 person hours was contributed through Employee Social Options (ESOPs) which is
the Company organised volunteering programme at the Mahindra Group.
During the last Financial Year, your Company's efforts to drive
positive change were acknowledged by various forums and your Company received the
following awards:
1. FICCI CSR Award for Mahindra Hariyali Project in the Category -
Skill Development and Livelihood - Private Sector Companies with INR 3001 Crores per annum
and above. (August 2021)
2. CSR Journal Excellence Award 2021 for PRERNA Project in the
Category-Women Empowerment and Child welfare. (March 2022)
3. CII Award - Noteworthy Project in Water Management for Integrated
Watershed Management Project, Hatta. (December 2021)
4. Project Nanhi Kali - Runner-up in the international BRICS SDG Awards
in the category of SDG 5: Gender Equality. (August 2021)
5. Runner-up in CSR Journal Excellence Award 2021 for Self-Implemented
Integrated Water Management Project, Hatta in the Category-Environment. (March 2022)
CSR Policy
The Corporate Social Responsibility Committee had formulated and
recommended to the Board, a Corporate Social Responsibility Policy (CSR Policy) which was
subsequently adopted by it and is being implemented by the Company. The CSR Policy
including name of the CSR projects or programs undertaken can be accessed in the
Governance section at the Web-link:
https://www.mahindra.com/investors/reports-and-filings.
CSR Committee
As mentioned in the previous Annual Report, the Board at its Meeting
held on 26th March, 2021 re-constituted the Corporate Social Responsibility
Committee. Dr. Pawan Goenka ceased to be the Member of the Committee with effect from 2nd
April, 2021, upon cessation as a Director of the Company and Dr. Anish Shah was inducted
in his place.
Further, the Board at its Meeting held on 28th May, 2021
re-constituted the Corporate Social Responsibility Committee by inducting Mr. Muthiah
Murugappan as a Member of the Committee. The CSR Committee comprises of Dr. Vishakha N.
Desai (Chairperson), Mr. Anand G. Mahindra, Dr. Anish Shah, Mr. Vikram Singh Mehta and Mr.
Muthiah Murugappan.
The Committee, inter alia, reviews and monitors the CSR as well as
Sustainability activities.
Subsequent to the year end, the scope of the Committee was enhanced by
including in its Charter Environment, Social and Governance (ESG) related matters, the
details of which are furnished in the Report on Corporate Governance that forms part of
this Annual Report.
During the year under review, your Company spent Rs. 97,07,68,887 on
CSR activities. The amount equal to 2% of the average net profit for the past three
financial years required to be spent on CSR activities was Rs. 96,84,63,072. The Board has
considered the Impact Assessment Reports at its meeting held on 28th May, 2022.
The detailed Annual Report on the CSR activities undertaken by your Company in the
Financial Year 2022 along with the Executive Summary for Impact Assessment Reports of the
applicable projects, is annexed herewith and marked as Annexure VI.
The complete Impact Assessment Reports of the applicable projects can
be accessed at the Web-link: https://www.mahindra.com/resources/FY22/AnnualReport.zip
Sustainability
During the year under review, the 14th Sustainability Report
for the year 2020-21 was released. The Report was externally assured by KPMG and prepared
in accordance with the GRI Standards-Core option.
By implementing Mahindra Sustainability Framework, your Company
continued the focus on the Environmental, Social and Governance (ESG) parameters ensuring
a common language for sustainability across the Group. This framework defines
sustainability as "Building enduring business by rejuvenating the environment and
enabling stakeholders to rise". Under the three pillars People, Planet and Profit of
Sustainability Framework; various actions have been implemented across the Group.
The ESG information is disclosed under Dow Jones Sustainability Index
(DJSI) and Carbon Disclosure Project (CDP). In DJSI, your Company has achieved position in
both World and Emerging Market Index. In CDP Climate and CDP Water, your Company has
achieved level A.
Your Company has committed to Science Based Target, an initiative to
restrict average global temperature rise in alignment of Paris Climate Change Agreement.
The Group is committed to become Carbon Neutral by 2040.
Dr. Anish Shah, Managing Director & CEO of your Company
participated in the First Movers Coalition dialogue with US Special Presidential Envoy on
Climate organised by World Economic Forum. He also attended CEO climate leaders meeting
organized by World Economic Forum on building the net-zero economy and carbon removals.
The Sustainability performance for your Company for the Financial Year
2021-22 will be elaborated in detail in the GRI Report which is under preparation and will
be ready for release shortly.
Your Company was recognized for its leadership position on the ESG
dimensions during the year under review, by way of the following:
• Part of DJSI yearbook 2022. Top 15 percentile of an industry
gets featured in the yearbook.
• Inclusion in CDP Supplier Engagement Leader Board 2021.
• Part of Power list of top 50 India's Most Sustainable Companies
2021-22, by Business World.
Conservation of Energy, Technology Absorption and
Foreign Exchange Earnings and Outgo
The information pertaining to conservation of energy, technology
absorption, foreign exchange earnings and outgo as required under section 134(3)(m) of the
Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 is
attached as Annexure VII and forms part of this Report.
Share Capital
During the year under review, the Authorised Share Capital of the
Company was increased from Rs. 4,075 crores divided into 810,00,00,000 Ordinary (Equity)
Shares of Rs. 5 each and 25,00,000 Unclassified shares of Rs. 100 each to Rs. 10,575
crores divided into 1810,00,00,000 Ordinary (Equity) Shares of Rs. 5 each and 25,00,000
Unclassified shares of Rs. 100 each and 150,00,00,000 Preference Shares of Rs. 10 each
pursuant to the Scheme of Merger by Absorption of Mahindra Vehicle Manufacturers Limited
with the Company becoming effective from 1st July, 2021.
The Authorised Share Capital of the Company further stands increased to
Rs. 11,681.5 crores divided into 2031,30,00,000 Ordinary (Equity) Shares of Rs. 5 each and
25,00,000 Unclassified shares of Rs. 100 each and 150,00,00,000 Preference Shares of Rs.
10 each pursuant to the Scheme of Merger by Absorption of Mahindra Engineering and
Chemical Products Limited, Retail Initiative Holdings Limited and Mahindra Retail Limited
with the Company becoming effective from 29th April, 2022.
The issued, subscribed and paid-up Share Capital of the Company stood
at Rs. 621.60 crores as at 31st March, 2022 comprising of 1,24,31,92,544
Ordinary (Equity) Shares of Rs. 5 each fully paid-up. There was no change in the issued,
subscribed and paid-up Share Capital during the year under review.
Compliance with the provisions of Secretarial
Standard 1 and Secretarial Standard 2
The applicable Secretarial Standards, i.e. SS-1 and SS-2, relating to
'Meetings of the Board of Directors' and 'General Meetings' respectively, have been duly
complied by your Company.
Annual Return
Pursuant to section 134(3)(a) and section 92(3) of the Companies Act,
2013 read with Rule 12(1) of the Companies (Management and Administration) Rules, 2014, a
copy of the annual return is placed on the website of the Company and can be accessed at
https://www.mahindra.com/resources/FY22/AnnualReport.zip
The details of the Key Policies adopted by the Company are mentioned at
Annexure VIII to the Board's Report.
There was one proceeding initiated/pending against your Company under
the Insolvency and Bankruptcy Code, 2016 which does not materially impact the business of
the Company. The Company has filed its detailed reply and the matter is pending for final
hearing.
Neither the Executive Chairman (upto 11th November, 2021)
nor the Managing Director nor the Executive Director (Automotive & Farm Sectors)
received any remuneration or commission from any of the subsidiaries of your Company.
Your Directors state that no disclosure or reporting is required in
respect of the following items as there were no transactions/events on these items during
the year under review:
1. I ssue of equity shares with differential rights as to dividend,
voting or otherwise.
2. Issue of Shares (including Sweat Equity Shares) to employees of the
Company under any Scheme save and except Employees Stock Option Schemes (ESOS) referred to
in this Report.
3. Significant or material orders passed by the Regulators or Courts or
Tribunals which impact the going concern status and the Company's operation in future.
4. Voting rights which are not directly exercised by the employees in
respect of shares for the subscription/ purchase of which loan was given by the Company
(as there is no scheme pursuant to which such persons can beneficially hold shares as
envisaged under section 67(3)(c) of the Companies Act, 2013).
5. There has been no change in the nature of business of your Company.
6. The Company has not made any one-time settlement for loans taken
from the Banks or Financial Institutions, and hence the details of difference between
amount of the valuation done at the time of one time settlement and the valuation done
while taking loan from the Banks or Financial Institutions along with the reasons thereof
is not applicable.
7. There was no revision of financial statements and Board's Report of
the Company during the year under review.
For and on behalf of the Board
ANAND G. MAHINDRA
Chairman
Mumbai, 28th May, 2022