About Asian Paints Ltd

Asian Paints Ltd is India's largest paint company and Asia's third largest paint company. The company, along with their subsidiaries, has operations in 22 countries globally with 27 paint manufacturing facilities servicing consumers in 65 countries through Berger International, SCIB Paints, Apco Coatings and Taubmans. Asian Paints manufactures a wide range of paints for decorative and industrial use. The products of the company include ancilliaries, automotive, decorative paints, and industrial paints. The company has manufacturing plants in Maharashtra, Gujarat, Andhra Pradesh, Uttar Pradesh, Tamil Nadu and Haryana. In Decorative paints, the company is present in all the four segments, namely Interior Wall Finishes, Exterior Wall Finishes, Enamels and Wood Finishes. They have also introduced many innovative concepts in the Indian paint industry like Colour Worlds (Dealer Tinting Systems), Home Solutions (painting solutions Service), Kids World (painting solutions for kid's room), Colour Next (Prediction of Colour Trends through in-depth research) and Royale Play Special Effect Paints, just to name a few. Asian Paints Ltd was incorporated in the year 1945. In the year 1965, the name of the company was changed to Asian Paints (India) Pvt Ltd. In the year 1973, the company was converted into a public limited company. In the year 1972, they undertook a major modernization programme to streamline the paint production facilities by improving the layout of machines, addition to balancing equipment and replacement of old machinery to meet the demand. In the year 1985, the Company had set up a third paint unit at Patancheru, a notified backward area near Hyderabad, for the manufacture of 15,000 MT of paints and enamels. Also, they entered into a collaboration agreement with Nippon Paints Company Ltd, Japan, to obtain technical know-how to manufacture powder coating and coil coatings. In the year 1987, the company commissioned a plant for the manufacture of synthetic rubbers lattices with a capacity of 1,200 tonnes per annum. Also, the company in association with Tamil Nadu Industrial Development Corporation (TIDCO) promoted a joint sector company under the name of Pentasia Chemicals Ltd (PCL), for the purpose of manufacture 3,000 TPA of pentaerythritol and 1,800 TPA of sodium formate. In the year 1990, the company promoted two joint venture companies, namely Asian Paints (South Pacific) Ltd, in Fiji and Asian Paints (Tonga) Ltd. Apart from this, the company formulated two more joint ventures under the names and styles of Asian Paints (Nepal) Pvt Ltd and Asian Paints (S.I.) Ltd. In May 1991, the company acquired 19,10,000 equity shares of Pentasia Chemicals Ltd from TIDCO and thus PCL became a subsidiary of the company. During the year 1992-93, the company installed and commissioned the manufacturing facilities for the powder coatings with a capacity of 300 MT at Kasna plant. In the year 1993, they set up a joint venture unit along with their overseas subsidiaries, in Queens land, Australia for manufacture of paints, enamels and varnishes. In the year 1994, Pentasia Chemicals Ltd was amalgamated with the company with effect from October 1, 1994. In the year 1995, the company set up a joint venture unit for the manufacture of paints, enamels and varnishes in the Republic of Mauritius. In the year 1996, the company and PPG Industries, Inc. of USA set up a joint venture company namely Asian PPG Industries Pvt Ltd to market and/or manufacture automotive paints and certain Industrial products. In the year 1998, they introduced three new products, NC range of wood finishes, ACE Exterior Emulsion and Asian wall putty. Also, they launched a new marketing thrust with the introduction of a one-stop Colour shop for paints complete with software for consumers to choose and select their different shade combinations. They launched their first exclusive showroom in Mumbai. In the year 1999, the company acquired 76% of equity stake in Sri Lanka-based Delmege Forsyth & Co (Paints) Ltd. In the year 2000, they launched two variants in polyurethane (PU) wood finish under the brand name Opal. They opened a manufacturing plant in Oman in partnership with a local company. Also, they acquired the entire paints business of Pacific Paints Company based in Australia for over of Rs. 1 crore. In the year 2001, the company introduced Utsav Enamel for the festival season. In 2002, the company revamped their international operations and transferred shares in their subsidiaries in Fiji, Tonga, Solomon Island, Vanuata, Australia and the Sultanate of Oman to the Mauritius based subsidiary Asian Paints International. Also, they acquired controlling stake of 50.1% in Berger International, Singapore, for the consideration of Rs. 58 crore. In the year 2003, the company through their Singapore-based subsidiary, Berger International, signed a technology and brand licensing agreement with PT Abadi Coatings Solusi, an Indonesian paint company. Also, they acquired Taubmans Paints (Fiji) Ltd through their subsidiary, Asian Paints (South Pacific) Ltd in Fiji. During the year 2003-04, Pentasia Investments Ltd, a wholly owned subsidiary of the company was amalgamated with the company. In the year 2004, the company launched paint solutions for kids. In January 2005, they set up a new paint plant at Sriperumbudur, in Tamil Nadu and commenced commercial production. In the year 2006, the company commissioned a manufacturing facility for powder coatings at Baddi, Himachal Pradesh. In September 2007, the company tailored their first exclusive industrial coatings manufacturing facility at Taloja in Maharashtra, with an installed capacity of 14,000 KL per annum. During the year 2007-08, the company commissioned the polymer plant in Sriperumbudur. Also, they commenced expansion of the Sriperumbudur plant. Also, Asian Paints (International) Ltd, the company's direct subsidiary divested their entire stake in Asian Paints (Queensland) Pty Ltd, Australia. During the year 2008-09, the company made a tie up with Dupont USA to co-brand the Royale range of Emulsions with Teflon, the product synonymous with toughness and durability. The company commenced introducing a new chain of 'Colour ideas' where retail outlets have been modified to offer slice of the 'Signature Store' thereby providing the same inspiration to consumers in process of designing their homes. The first two stores have been inaugurated at Hyderabad and Chennai. During the year, the company increased the capacity of the Sriperumbudur Plant to 100,000 KL per annum. Also, they commissioned the Distribution Centres at Kasna Plant and Ankleshwar Plant. Asian Paints (International) Ltd, the company's direct subsidiary, purchased the balance 49% stake in Asian Paints (Tonga) Ltd for a consideration of TOP 646,800 (approx. USD 314,000) making it a wholly owned subsidiary.During the year 2009-10, the company increased the capacity of Sriperumbudur Plant in Tamil Nadu to 140,000 KL per annum. They procured land for setting up a manufacturing facility for Decorative Paint in Kesurdi, Maharashtra. As per the scheme of amalgamation, Technical Instruments Manufacturers (India) Ltd (TIM), a 100% subsidiary of the company was amalgamated with the company with effect from April 1, 2009. In April 12, 2010, the company commissioned the first phase of sixth Decorative paint plat at Rohtak, Haryana as a cost of approx. Rs 500 crore with an initial capacity of 150,000 KL per annum. During the year 2010-11, the company augmented the synthetic resins and polymer capacity by 50,000 MT. The company launched a number of new products. Water based wood finishes launched in North India would be launched across the country in a phased manner. New textured finishes for the exteriors - Duracast Pebbletex and Crosstex were launched and met with good response from builders/ contractors for large projects. During the year, the company approved the plans to enhance its 14 year relationship with PPG Industries Inc. (PPG), to accelerate growth of their non-decorative coatings businesses in India. As part of this arrangement, the company and PPG will expand their existing non-decorative coatings presence in India by expanding their current 50-50 joint venture relationship, Asian PPG Industries Ltd (APPG), and also establish a second 50-50 joint venture. The company decides to increase the installed capacity at the Rohtak Plant from 150,000 KL per annum to 200,000 KL per annum. The company commenced the construction at Khandala near Pune (in Maharashtra) for the seventh Decorative Paints plant with an initial capacity of 300,000 KL per annum of paints with an investment of around Rs. 1000 crore. The plant will be commissioned sometime around the last quarter of FY 2012-13. The Khandala plant can be expanded to 400,000 KL per annum later. Asian Paints with its intent to enter the Home Improvement and Decor space in India acquired 51% stake in Sleek International Private Limited (Sleek), a kitchen solutions provider in August 2013. Mumbai-based Sleek Group is a major organised player in the modern kitchen space and is engaged in the business of manufacturing, selling and distributing kitchens, kitchen components including wire baskets, cabinets, appliances, accessories, etc, with pan India presence. In June 2014, Asian Paints acquired the entire front and sales business including Brands, Network and Sales Infrastructure of Ess Ess Bathroom products Pvt Ltd. Ess Ess is a prominent player in the bath fittings business. On 3 April 2017, Berger International Private Limited (BIPL), Singapore, an indirect subsidiary of Asian Paints completed the acquisition of 100% controlling stake in Causeway Paints Lanka (Private) Limited, Sri Lanka (CPLPL), a key player in the Sri Lanka coatings market. On 5 September 2017, PT Asian Paints Indonesia, Indonesia (PT API) a wholly owned subsidiary of Berger International Private Limited, Singapore (an indirect subsidiary of the Asian Paints) commenced manufacturing operations with a capacity of 5,000 tons per annum on a single shift basis in Jawa Barat region in Indonesia. On 11 December 2017, Asian Paints acquired the entire remaining 49% stake in kitchen solution provider company Sleek International Private Limited from the Ahuja family, thereby making it a wholly-owned subsidiary of the company.

Asian Paints Ltd Chairman Speech

We navigate through the ever-changing business landscape to create growth avenues for the future.

Dear Shareholders,

As I sit down to pen my thoughts on the year gone by, the first thought that strikes me is that till last year, it used to be my dear friend, late

Mr. Ashwin Choksi, addressing all of us through his annual letter. He was truly an amazing human being inspiring all of us to aim and achieve big and at the same time retain the humility to connect and relate with people across all strata. Always eager to learn, he would spend hours interacting with the younger generation of employees, understanding their views and drawing inspiration to keep the organisation s culture and imperatives relevant with times. I will always cherish and take strength from his reassuring smile in my endeavour to lead this organisation to greater heights.

On March 31^st, 2019, three stalwarts of our Board who have served the Company for many years, helping build what it is today, retired. I am extremely grateful to Mr. Mahendra Choksi, Mr. Mahendra Shah and Mr. S. Ramadorai and would like to thank them on behalf of Asian Paints Ltd. and all its shareholders for their contribution. Looking back at FY2018-19, it turned out to be another roller-coaster period with its share of uncertainty and volatility. On the positive side, we saw some improvement in the demand conditions in the domestic market as compared to the previous year with trade and supply channels recovering from the past disruptions caused by demonetisation and the implementation of the Goods and Services Tax (GST). However, customer confidence was uncertain and this has reflected in a marked slowdown witnessed in some of the large sectors of the economy, particularly in the last quarter of the financial year.

Persistently tight credit conditions accentuated by the challenges in the NBFC (Non-Banking Financial Company) sector, rising unemployment and low rural and urban income growth were key contributors to the dampened sentiment. The year was also marked by high inflation on the raw material front leading to a tightening of the operating margins. And though we were able to recover a part of the margin pressure through price increases, the uncertain demand conditions meant a consistent drive in the business to optimise its cost structure to alleviate the margin pressure. The international markets faced their own set of challenges with some markets affected by foreign exchange tightness while a few impacted by very high inflation levels and low GDP growths.

At the overall level, I am very happy with the performance we have been able to deliver not withstanding difficult business conditions. Focussed efforts in expanding the market by looking at upgradation from bottom of the pyramid resulted in volume growth of the India business to be the highest in the last few years. We continuously innovated by launching new products and services, thereby moving forward in our journey of being the most inspirational home dcor brand for consumers. Our industry beating growth, on our market position, is definitely an achievement that every stakeholder of this organisation should be proud of.

At the same time, we continue to uphold the highest standards of corporate governance, treating them as an ethical requisite rather than a regulatory necessity and continue to base all our actions on the principles of fairness, trust and transparency. During the year, Mrs. Pallavi Shroff, a leading luminary from the field of Corporate Law and Mr. Suresh Narayanan, a business stalwart of repute, were appointed as Independent Directors to the Board of the Company. The Board will benefit immensely from the vast and rich experience that these new members bring to the table.

Looking forward, the business environment will remain true to its nature – as uncertain and as unpredictable as ever. In such an environment, only those organisations that put in efforts to remain relevant to the changing needs and preferences of consumers – understanding the consumer requirements and adapting the business model to suitably address these requirements, will be able to deliver long-term growth and sustainable returns to all the stakeholders. Our vision of becoming the most inspirational home dcor brand is based on the growing consumer preference for curated dcor and personalised solutions as the consumer looks at creating a differentiated home space with a unique identity. As an organisation, we will continue to expand our product offerings and adapt our business channels – from brick & mortar to digital, to deliver on these consumer aspirations. ‘AP Homes' – our flagship decor outlets as well as ‘beautifulhomes.com' and ‘asianpaints.com' the digital properties of our Company continue to provide critical insights in consumer behaviour and choices, which will need to be harnessed effectively to establish our Company's dcor expertise. At the same time, product and application innovation – to address the stated as well as unstated consumer needs, will need to be a continuous investment. Our Research & Technology function is fully geared towards this and its various research initiatives have helped us launch several pioneering products with distinctive value proposition for consumers. During the year, we have launched some innovative products like Royale Health Shield, which has been designed to address the safety and health needs, Apcolite Rust Shield to address the challenge of corrosion on metallic surfaces and

Ultima Protek Lamino, which offers longer service life and unmatched performance.

Most importantly, as we navigate through the ever-changing business landscape to create growth avenues for the future, it is important to contribute positively towards the society and the environment. Efforts taken by us for water-usage reduction and waste-generation reduction, as well as investments made in the area of rainwater harvesting and increasing renewable energy usage, are steps taken to create a long-term sustainable journey for the organisation.

I take this opportunity to thank you all for the unwavering support and commitment that continues to provide us strength to forge ahead in our endeavour.

Asian Paints Ltd Company History

Asian Paints Ltd is India's largest paint company and Asia's third largest paint company. The company, along with their subsidiaries, has operations in 22 countries globally with 27 paint manufacturing facilities servicing consumers in 65 countries through Berger International, SCIB Paints, Apco Coatings and Taubmans. Asian Paints manufactures a wide range of paints for decorative and industrial use. The products of the company include ancilliaries, automotive, decorative paints, and industrial paints. The company has manufacturing plants in Maharashtra, Gujarat, Andhra Pradesh, Uttar Pradesh, Tamil Nadu and Haryana. In Decorative paints, the company is present in all the four segments, namely Interior Wall Finishes, Exterior Wall Finishes, Enamels and Wood Finishes. They have also introduced many innovative concepts in the Indian paint industry like Colour Worlds (Dealer Tinting Systems), Home Solutions (painting solutions Service), Kids World (painting solutions for kid's room), Colour Next (Prediction of Colour Trends through in-depth research) and Royale Play Special Effect Paints, just to name a few. Asian Paints Ltd was incorporated in the year 1945. In the year 1965, the name of the company was changed to Asian Paints (India) Pvt Ltd. In the year 1973, the company was converted into a public limited company. In the year 1972, they undertook a major modernization programme to streamline the paint production facilities by improving the layout of machines, addition to balancing equipment and replacement of old machinery to meet the demand. In the year 1985, the Company had set up a third paint unit at Patancheru, a notified backward area near Hyderabad, for the manufacture of 15,000 MT of paints and enamels. Also, they entered into a collaboration agreement with Nippon Paints Company Ltd, Japan, to obtain technical know-how to manufacture powder coating and coil coatings. In the year 1987, the company commissioned a plant for the manufacture of synthetic rubbers lattices with a capacity of 1,200 tonnes per annum. Also, the company in association with Tamil Nadu Industrial Development Corporation (TIDCO) promoted a joint sector company under the name of Pentasia Chemicals Ltd (PCL), for the purpose of manufacture 3,000 TPA of pentaerythritol and 1,800 TPA of sodium formate. In the year 1990, the company promoted two joint venture companies, namely Asian Paints (South Pacific) Ltd, in Fiji and Asian Paints (Tonga) Ltd. Apart from this, the company formulated two more joint ventures under the names and styles of Asian Paints (Nepal) Pvt Ltd and Asian Paints (S.I.) Ltd. In May 1991, the company acquired 19,10,000 equity shares of Pentasia Chemicals Ltd from TIDCO and thus PCL became a subsidiary of the company. During the year 1992-93, the company installed and commissioned the manufacturing facilities for the powder coatings with a capacity of 300 MT at Kasna plant. In the year 1993, they set up a joint venture unit along with their overseas subsidiaries, in Queens land, Australia for manufacture of paints, enamels and varnishes. In the year 1994, Pentasia Chemicals Ltd was amalgamated with the company with effect from October 1, 1994. In the year 1995, the company set up a joint venture unit for the manufacture of paints, enamels and varnishes in the Republic of Mauritius. In the year 1996, the company and PPG Industries, Inc. of USA set up a joint venture company namely Asian PPG Industries Pvt Ltd to market and/or manufacture automotive paints and certain Industrial products. In the year 1998, they introduced three new products, NC range of wood finishes, ACE Exterior Emulsion and Asian wall putty. Also, they launched a new marketing thrust with the introduction of a one-stop Colour shop for paints complete with software for consumers to choose and select their different shade combinations. They launched their first exclusive showroom in Mumbai. In the year 1999, the company acquired 76% of equity stake in Sri Lanka-based Delmege Forsyth & Co (Paints) Ltd. In the year 2000, they launched two variants in polyurethane (PU) wood finish under the brand name Opal. They opened a manufacturing plant in Oman in partnership with a local company. Also, they acquired the entire paints business of Pacific Paints Company based in Australia for over of Rs. 1 crore. In the year 2001, the company introduced Utsav Enamel for the festival season. In 2002, the company revamped their international operations and transferred shares in their subsidiaries in Fiji, Tonga, Solomon Island, Vanuata, Australia and the Sultanate of Oman to the Mauritius based subsidiary Asian Paints International. Also, they acquired controlling stake of 50.1% in Berger International, Singapore, for the consideration of Rs. 58 crore. In the year 2003, the company through their Singapore-based subsidiary, Berger International, signed a technology and brand licensing agreement with PT Abadi Coatings Solusi, an Indonesian paint company. Also, they acquired Taubmans Paints (Fiji) Ltd through their subsidiary, Asian Paints (South Pacific) Ltd in Fiji. During the year 2003-04, Pentasia Investments Ltd, a wholly owned subsidiary of the company was amalgamated with the company. In the year 2004, the company launched paint solutions for kids. In January 2005, they set up a new paint plant at Sriperumbudur, in Tamil Nadu and commenced commercial production. In the year 2006, the company commissioned a manufacturing facility for powder coatings at Baddi, Himachal Pradesh. In September 2007, the company tailored their first exclusive industrial coatings manufacturing facility at Taloja in Maharashtra, with an installed capacity of 14,000 KL per annum. During the year 2007-08, the company commissioned the polymer plant in Sriperumbudur. Also, they commenced expansion of the Sriperumbudur plant. Also, Asian Paints (International) Ltd, the company's direct subsidiary divested their entire stake in Asian Paints (Queensland) Pty Ltd, Australia. During the year 2008-09, the company made a tie up with Dupont USA to co-brand the Royale range of Emulsions with Teflon, the product synonymous with toughness and durability. The company commenced introducing a new chain of 'Colour ideas' where retail outlets have been modified to offer slice of the 'Signature Store' thereby providing the same inspiration to consumers in process of designing their homes. The first two stores have been inaugurated at Hyderabad and Chennai. During the year, the company increased the capacity of the Sriperumbudur Plant to 100,000 KL per annum. Also, they commissioned the Distribution Centres at Kasna Plant and Ankleshwar Plant. Asian Paints (International) Ltd, the company's direct subsidiary, purchased the balance 49% stake in Asian Paints (Tonga) Ltd for a consideration of TOP 646,800 (approx. USD 314,000) making it a wholly owned subsidiary.During the year 2009-10, the company increased the capacity of Sriperumbudur Plant in Tamil Nadu to 140,000 KL per annum. They procured land for setting up a manufacturing facility for Decorative Paint in Kesurdi, Maharashtra. As per the scheme of amalgamation, Technical Instruments Manufacturers (India) Ltd (TIM), a 100% subsidiary of the company was amalgamated with the company with effect from April 1, 2009. In April 12, 2010, the company commissioned the first phase of sixth Decorative paint plat at Rohtak, Haryana as a cost of approx. Rs 500 crore with an initial capacity of 150,000 KL per annum. During the year 2010-11, the company augmented the synthetic resins and polymer capacity by 50,000 MT. The company launched a number of new products. Water based wood finishes launched in North India would be launched across the country in a phased manner. New textured finishes for the exteriors - Duracast Pebbletex and Crosstex were launched and met with good response from builders/ contractors for large projects. During the year, the company approved the plans to enhance its 14 year relationship with PPG Industries Inc. (PPG), to accelerate growth of their non-decorative coatings businesses in India. As part of this arrangement, the company and PPG will expand their existing non-decorative coatings presence in India by expanding their current 50-50 joint venture relationship, Asian PPG Industries Ltd (APPG), and also establish a second 50-50 joint venture. The company decides to increase the installed capacity at the Rohtak Plant from 150,000 KL per annum to 200,000 KL per annum. The company commenced the construction at Khandala near Pune (in Maharashtra) for the seventh Decorative Paints plant with an initial capacity of 300,000 KL per annum of paints with an investment of around Rs. 1000 crore. The plant will be commissioned sometime around the last quarter of FY 2012-13. The Khandala plant can be expanded to 400,000 KL per annum later. Asian Paints with its intent to enter the Home Improvement and Decor space in India acquired 51% stake in Sleek International Private Limited (Sleek), a kitchen solutions provider in August 2013. Mumbai-based Sleek Group is a major organised player in the modern kitchen space and is engaged in the business of manufacturing, selling and distributing kitchens, kitchen components including wire baskets, cabinets, appliances, accessories, etc, with pan India presence. In June 2014, Asian Paints acquired the entire front and sales business including Brands, Network and Sales Infrastructure of Ess Ess Bathroom products Pvt Ltd. Ess Ess is a prominent player in the bath fittings business. On 3 April 2017, Berger International Private Limited (BIPL), Singapore, an indirect subsidiary of Asian Paints completed the acquisition of 100% controlling stake in Causeway Paints Lanka (Private) Limited, Sri Lanka (CPLPL), a key player in the Sri Lanka coatings market. On 5 September 2017, PT Asian Paints Indonesia, Indonesia (PT API) a wholly owned subsidiary of Berger International Private Limited, Singapore (an indirect subsidiary of the Asian Paints) commenced manufacturing operations with a capacity of 5,000 tons per annum on a single shift basis in Jawa Barat region in Indonesia. On 11 December 2017, Asian Paints acquired the entire remaining 49% stake in kitchen solution provider company Sleek International Private Limited from the Ahuja family, thereby making it a wholly-owned subsidiary of the company.

Asian Paints Ltd Directors Reports

Dear Members,

The Board of Directors are pleased to present the Seventy-third Annual Report of the Company for the financial year ended 31^st March, 2019.

Financial Results

The Company's financial performance for the year ended 31^st March, 2019 is summarized below:

* Figures for Revenue from Operations are comparable numbers i.e. Excise Duty has been removed as the same does not form part of Revenue post GST implementation.

Company's Performance Review

During the financial year 2018-19:

• Revenue from operations on standalone basis increased to Rs. 16,391.78 crores as against Rs. 14,153.71 crores in the previous year – a growth of 15.8%.

• Cost of goods sold as a percentage to revenue from operations increased to 57.4% as against 56.4% in the previous year.

• Employee cost as a percentage to revenue from operations decreased to 5.5% (Rs. 902.79 crores) against 5.6% (Rs. 791.08 crores) in the previous year.

• Other expense as a percentage to revenue from operations decreased to 16.9% (Rs. 2,770.42 crores) as against 17.4% (Rs. 2,459.43 crores) in the previous year.

• The Profit after Tax for the current year is Rs. 2,134.76 crores against Rs. 1,894.80 crores in the previous year – a growth of 12.7%.

• On a consolidated basis, the Company, its subsidiaries and joint venture companies, achieved revenue of Rs. 19,349.84 crores as against Rs. 16,843.76 crores – a growth of 14.9%. Net profit after non-controlling interest for the group for the current year is Rs. 2,159.49 crores as against Rs. 2,038.93 crores in the previous year – a growth of 5.9%.

Dividend

During the year under review, the Company paid to the shareholders, an interim dividend of Rs. 2.85 (Rupees two and paise eighty five only) per equity share of the face value of Rs. 1 (Rupee one only) each in the month of November, 2018. In addition, the Board of Directors have recommended payment of Rs. 7.65 (Rupees seven and paise sixty fifty only) per equity share of the face value of Rs. 1 (Rupee one only) each as final dividend for the financial year 2018-19, for the approval of the shareholders at the ensuing Annual General Meeting ('AGM') of the Company. If approved, the total dividend (interim and final dividend) for the financial year 2018-19 will be Rs. 10.50 (Rupees ten and paise fifty only) per equity share of the face value of Rs. 1 (Rupee one only) each as against the total dividend of Rs. 8.70 (Rupees eight and paise seventy only) per equity share of the face value of Rs. 1 each (Rupee one only) paid for the previous financial year 2017-18. The dividend declared and/or paid by the Company for the financial year 2018-19, is in compliance with the Dividend Distribution Policy.

The Dividend Distribution Policy of the Company is set out as Annexure [A] and is also uploaded on the Company's website https:// www.asianpaints.com/more/investors/policies-programs.html.

Investor Education and Protection Fund (IEPF)

In accordance with the applicable provisions of Companies Act, 2013 read with Investor Education and Protection Fund (Accounting, Audit, Transfer and Refund) Rules, 2016 ("IEPF Rules"), all unclaimed dividends are required to be transferred by the Company to the IEPF, after completion of seven (7) years. Further, according to IEPF Rules, the shares on which dividend has not been claimed by the shareholders for seven (7) consecutive years or more shall be transferred to the demat account of the IEPF Authority. The details relating to amount of dividend transferred to the IEPF and corresponding shares on which dividends were unclaimed for seven (7) consecutive years, are provided in the General Shareholders Information section of this Annual Report.

Material Changes Affecting the Company

There are no material changes and commitments affecting the financial position of the Company which have occurred between the end of the financial year 2018-19 and the date of this report. There has been no change in the nature of business of the Company.

Consolidated Financial Statements

In accordance with the provisions of Companies Act, 2013 (hereinafter referred to as "the Act"), Regulation 33 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred to as "Listing Regulations") and applicable Accounting Standards, the Audited Consolidated Financial Statements of the Company for the financial year 2018-19, together with the Auditors' Report form part of this Annual Report.

Financial Performance:

A statement containing the salient features of financial statements of subsidiaries/joint venture companies of the Company in the prescribed Form AOC – 1 forms a part of Consolidated Financial Statements (CFS) in compliance with Section 129 (3) and other applicable provisions, if any, of the Act read with Rule 5 of the Companies (Accounts) Rules, 2014.

The said Form also highlights the financial performance of each of the subsidiaries and joint venture companies included in the CFS of the Company pursuant to Rule 8(1) of the Companies (Accounts) Rules, 2014.

In accordance with Section 136 of the Act, the financial statements of the subsidiary and associate companies are available for inspection by the members at the Registered Office of the Company during business hours on all days except Saturdays, Sundays and public holidays upto the date of the AGM. Any member desirous of obtaining a copy of the said financial statements may write to the Company Secretary at the Registered Office of the Company. The financial statements including the CFS, and all other documents required to be attached to this report have been uploaded on the website of the Company at www.asianpaints.com.

The Company has in accordance with the amendments to Listing Regulations revised the Policy for determining material subsidiaries. The said policy may be accessed on the website of the Company at https://www.asianpaints.com/more/investors/policies-programs. html. The Company has no material subsidiary company.

The Board of Directors at their meeting held on 9^th May, 2019, have, inter alia, approved the following investments approximately in accordance with the applicable provisions of law:

(i) Rs. 300 crores by way of subscription of equity shares of Asian Paints International Private Limited (APIPL), Singapore, wholly owned subsidiary of the Company, for the purpose of meeting funding requirements of its step down operating subsidiaries; and

(ii) Rs. 80 crores by way of subscription of equity shares of Sleek International Private Limited (Sleek), wholly owned subsidiary of the Company, to meet its requirements towards capital expenditure and working capital.

The aforementioned infusion in the equity shares of APIPL and Sleek is for furtherance of their business objectives.

Sad Demise of Mr. Ashwin Choksi, erstwhile Chairman of the Company

Mr. Ashwin Choksi, erstwhile Non-Executive Chairman of the Company, left for heavenly abode on 19^th September, 2018, after a brief illness. Late Mr. Ashwin Choksi was associated with the Company since 1965. He became the Managing Director of the Company in 1984. As an Executive Chairman for more than a decade, he pioneered to imbibe the best governance standards with entrepreneurship in the Company. He stepped down as Executive Chairman of the Company in 2009 and continued to hold the position of Non – Executive Chairman since then. Late Mr. Ashwin Choksi was the Chairman of the Company for more than two decades and the Company immensely benefitted from his vision and leadership. He was a humble and down to earth individual who led the Company without being in limelight. His sad demise is an irreparable loss to the Company. The Board of Directors of the Company express their deep condolences and pay tribute to late Mr. Ashwin Choksi, a great visionary leader.

Appointment of Mr. Ashwin Dani as the Chairman of the Company

The Board of Directors of the Company at their meeting held on 5^th November, 2018, elected Mr. Ashwin Dani as the Non-Executive Chairman of the Board and Company till the Annual General Meeting of the Company for the financial year 2020-21.

Change in Directorate

(i) Appointment of Mr. Manish Choksi on the Board of Directors of the Company The Board of Directors of the Company at their meeting held on 22^nd October, 2018, based on the recommendations of the Nomination & Remuneration Committee approved the appointment of Mr. Manish Choksi as a Non – Executive Promoter Director, to fill the casual vacancy created on the Board on account of the sad demise of Mr. Ashwin Choksi. The shareholders subsequently approved his appointment in casual vacancy by way of postal ballot with requisite majority. The Board of Directors at their meeting held on 5^th November, 2018, appointed Mr. Manish Choksi as the Non-Executive Vice-Chairman of the Board and the Company. Mr. Manish Choksi joined the Company in the year 1992 as an Executive and had grown in ranks by holding various positions across Sales, Engineering, Marketing in the Decorative and Industrial paint businesses. He transformed the Information Technology function of the Company and has been instrumental in leveraging the IT solutions across the extended enterprise and achieving improved business performance. He also headed the International Business of the Company and spearheaded the Company's efforts in expansion of its emerging markets portfolio. He had been a catalyst for the Company's foray into home improvement.

Before being inducted as the Non-Executive Director, he held the position of President – International Business, IT, HR & Chemicals in the Company. He was also a member of the Executive Council of the Company.

(ii) The Board of Directors at their meeting held on 21^st December, 2018 on recommendations of the Nomination & Remuneration Committee, inter alia, approved the following changes to the Board of Directors of the Company, subject to approval of shareholders of the Company. The shareholders have since approved their appointments/re – appointments with requisite majority by way of postal ballot, the results of which were declared on 26^th February, 2019:

(a) Continuation of Mr. Ashwin Dani (76 years) as a Non – Executive Promoter Director (liable to retire by rotation) of the Company after 31^st March, 2019 in compliance with the Regulation 17(1A) of Listing Regulations

Regulation 17(1A) of the Listing Regulations provides that listed entities shall not appoint any person or continue the directorship of any person, who has attained the age of 75 years, unless approval of shareholders have been obtained by way of special resolution. Accordingly, approval of the shareholders was obtained for continuation of Mr. Ashwin Dani's directorship.

Mr. Ashwin Dani has been associated with the Company since 1968. He joined the Company as a Senior Executive and moved through successive senior positions like Director - R&D, Works Director, Whole-time Director and served as Vice-Chairman and Managing Director from December, 1997 to March, 2009. He continued to hold the position of Non-Executive Vice Chairman of the Company until he was appointed as the Non- Executive Chairman of the Company on 5^th November, 2018.

Mr. Ashwin Dani is a technocrat and drives strong focus on Research and Development initiatives within the Company. His knowledge of the business environment and vast experience in general management has been an asset to the Company.

(b) Appointment of Mr. Suresh Narayanan as an Independent Director on the Board of Directors of the Company for a period of 5 years w.e.f. 1^st April, 2019 to 31^st March, 2024, pursuant to applicable provisions of the Act read with the Rules issued thereunder and the Listing Regulations

Mr. Suresh Narayanan is currently the Chairman & MD of Nestle India Limited. He joined Nestle in the year 1999 and has been associated with the Company since then. He has grown across ranks in the Sales & Marketing Department and held various positions in Nestle, India and other countries. He was the Chairman and CEO of Nestle Philippines, Inc. prior to joining Nestle India.

(c) Appointment of Mrs. Pallavi Shroff as an Independent Director on the Board of Directors of the Company for a period of 5 years w.e.f. 1^st April, 2019 to 31^st March, 2024, pursuant to applicable provisions of the Act read with the Rules issued thereunder and the Listing Regulations

Mrs. Pallavi Shroff is the Managing Partner of M/s. Shardul Amarchand Mangaldas, with extensive experience of over 37 years. Her broad and varied representation of public and private corporations and other entities before legal institutions, has earned her national and international acclaim. Mrs. Shroff has always been active in public policy related work. She appears regularly in the Supreme Court and High Courts of India, and in arbitrations, mediations and international legal disputes.

(d) Re-appointment of the following Independent Directors, not liable to retire by rotation, (whose tenure came to an end on 31^st March, 2019) for a second term pursuant to applicable provisions of the Act read with the Rules issued thereunder and Listing Regulations:

• Dr. S. Sivaram (72 years) re-appointed upto 30^th September, 2021;

• Mr. M. K. Sharma (72 years) re-appointed upto 31^st March, 2022;

• Mr. Deepak Satwalekar (70 years) re-appointed upto 30^th September, 2023; and

• Mrs. Vibha Paul Rishi (59 years) re-appointed upto 31^st March, 2024.

The aforementioned appointments were based on outcome of performance evaluation exercise, experience and contributions made by Dr. S. Sivaram, Mr. M. K. Sharma, Mr. Deepak Satwalekar and Mrs. Vibha Paul Rishi in their previous tenure.

The respective tenure(s) of Dr. S Sivaram, Mr. M. K. Sharma and Mr. Deepak Satwalekar were decided considering the year in which each of them will attain the age of 75 years.

(iii) Cessation of directorship of Mr. Mahendra Choksi, Non-Executive Director

Mr. Mahendra Choksi, Non – Executive Director of the Company informed the Board of Directors at its meeting held on 21^st December, 2018, of his desire to step down from directorship in view of his age and in order to comply with Regulation 17(1A) of the Listing Regulations.

Mr. Mahendra Choksi had joined the Board in the year 1992 and since then has been an integral part of the Board and its Committees where he was a member. He has contributed immensely to the functioning of the Board and the management has also benefitted from his advice and directions. The Board places on record gratitude for his advice and guidance.

(iv) Retirement of Non – Executive Directors

Mr. Mahendra Shah and Mr. S Ramadorai, Independent Director(s) of the Company, informed the Board of Directors at its Meeting held on 21^st December, 2018, that they would not be seeking re-appointment in view of their age and in compliance with Regulation 17(1A) of the Listing Regulations.

Mr. Mahendra Shah joined the Board as an Independent Director in the year 2001 and the Company has immensely benefitted from his guidance. The Board places on record appreciation for his thoroughness, dedication and commitment.

Mr. S Ramadorai joined the Board in the year 2009 and since then has significantly contributed to the functioning of the Board. The Board places on record appreciation for his perspective and thought leadership towards overall functioning of the Company.

(v) Appointment of Mr. Jigish Choksi as an Additional/Non – Executive Promoter Director of the Company

The Board of Directors of the Company at their meeting held on 29^th March, 2019, based on the recommendation of the Nomination and Remuneration Committee, had approved the appointment of Mr. Jigish Choksi as an Additional/Non-Executive Director with effect from 1^st April, 2019, subject to approval of shareholders of the Company.

Mr. Jigish Choksi has worked in the Sales & Marketing function of the Company for five years and is well versed with the functioning of the Company. He is also actively involved in his family businesses.

Approval of the shareholders is sought at the ensuing AGM for the appointment of Mr. Jigish Choksi as the Non-Executive Director of the Company, liable to retire by rotation. The Board and Nomination & Remuneration Committee recommend his appointment.

(vi) Retirement by rotation and subsequent re-appointment In accordance with the provisions of Section 152 and other applicable provisions, if any, of the Act read with the Companies (Appointment and Qualification of Directors) Rules, 2014 (including any statutory modification(s) or re-enactment(s) thereof for the time being in force) and the Articles of Association of the Company, Mr. Abhay Vakil and Mr. Malav Dani, Non-Executive Directors, are liable to retire by rotation at the ensuing AGM and being eligible have offered themselves for re-appointment.

In accordance with the provisions of the Act read with the Rules issued thereunder, the Listing Regulations and the Articles of Association of the Company, Additional Director, Independent Directors and the Managing Director of the Company are not liable to retire by rotation.

Declaration of independence from Independent Directors:

The Company has received declarations from all the Independent Directors confirming that they meet the criteria of independence as prescribed under the provisions of the Act, read with the Schedules and Rules issued thereunder, as well as clause (b) of sub-regulation (1) of Regulation 16 of the Listing Regulations (including any statutory modification(s) or re-enactment(s) thereof for the time being in force). In terms of Regulation 25(8) of the Listing Regulations, the Independent Directors have confirmed that they are not aware of any circumstance or situation, which exist or may be reasonably anticipated, that could impair or impact their ability to discharge their duties.

Number of meetings of the Board:

7 (seven) meetings of the Board of Directors were held during the financial year 2018 – 19. The details of the meetings of the Board of Directors of the Company convened during the financial year 2018-19 are given in the Corporate Governance Report which forms part of this Annual Report.

Nomination and Remuneration Policy

During the year under review, the Company has revised the Nomination and Remuneration Policy, in accordance with the amendments to Section 178 of the Act and Listing Regulations. The salient features of the Policy and changes therein are set out in the Corporate Governance Report which forms part of this Annual Report.

The said Policy of the Company, inter alia, provides that the Nomination and Remuneration Committee shall formulate the criteria for appointment of Directors on the Board of the Company and persons holding Senior Management positions in the Company, including their remuneration and other matters as provided under Section 178 of the Act and Listing Regulations.

The Policy is also available on the website of the Company https:// www.asianpaints.com/more/investors/policies-programs.html.

Remuneration of Directors, Key Managerial Personnel and particulars of employees:

The remuneration paid to the Directors is in accordance with the Nomination and Remuneration Policy formulated in accordance with Section 178 of the Act and Regulation 19 of the Listing Regulations (including any statutory modification(s) or re-enactment(s) thereof for the time being in force).

The information required under Section 197 of the Act read with Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 (including any statutory modification(s) or re-enactment(s) thereof for the time being in force) in respect of Directors/employees of the Company is set out in the Annexure [B] to this report and is also available on the website of the Company (www.asianpaints.com).

Performance Evaluation:

The Nomination and Remuneration Policy of the Company empowers the Nomination and Remuneration Committee to formulate a process for evaluating the performance of Individual Directors, Committees of the Board and the Board as a whole.

The parameters for the performance evaluation of the Board, inter alia, include performance of the Board on deciding long term strategy, rating the composition and mix of Board members, discharging of governance and fiduciary duties, handling critical and dissenting suggestions, etc.

The parameters for the performance evaluation of the Directors include attendance, effective participation in meetings of the Board, domain knowledge, vision, strategy, etc.

The Chairperson(s) of the respective Committees based on feedback received from the Committee members on the outcome of performance evaluation exercise of the Committee, shares a report to the Board.

The details of the evaluation process are set out in the Corporate Governance Report which forms a part of this Annual Report.

Directors' Responsibility Statement

Pursuant to Section 134 of the Act (including any statutory modification(s) or re-enactment(s) thereof for the time being in force), the Directors of the Company state that: a. in the preparation of the annual accounts for the financial year ended 31^st March, 2019, the applicable Accounting Standards and Schedule III of the Companies Act, 2013, have been followed and there are no material departures from the same; b. the Directors have selected such accounting policies and applied them consistently and made judgements 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 31^st March, 2019 and of the profits of the Company for the financial year ended 31^st March, 2019; c. proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; d. the annual accounts have been prepared on a ‘going concern' basis; e. proper internal financial controls laid down by the Directors were followed by the Company and that such internal financial controls are adequate and operating effectively; and f. proper systems to ensure compliance with the provisions of all applicable laws were in place and that such systems are adequate and operating effectively.

Management Discussion and Analysis

Management Discussion and Analysis as stipulated under the Listing Regulations is presented in a separate section forming part of this Annual Report. It provides details about the overall industry structure, global and domestic economic scenarios, developments in business operations/ performance of the Company's various businesses viz., decorative business, international operations, industrial and home improvement business, internal controls and their adequacy, risk management systems and other material developments during the financial year 2018-19.

Statutory Auditor:

M/s. Deloitte Haskins & Sells LLP, Chartered Accountants (Firm Registration No. 117366W/W-100018), were appointed as Statutory Auditors of the Company at the 70^th AGM held on 28^th June, 2016, to hold office till the conclusion of the 75^th AGM.

M/s. Deloitte Haskins & Sells LLP have confirmed that they are not disqualified from continuing as Auditors of the Company.

The Auditors have issued an unmodified opinion on the Financial Statements for the financial year ended 31^st March, 2019. During the financial year ended 31^st March, 2019, there had been no delay in transferring amounts required to be transferred to the Investor Education and Protection Fund, other than two instances of delays aggregating to Rs. 3.52 lakhs on account of unclaimed sales proceeds of fractional shares arising out of sale of bonus shares in earlier years.

The Auditors' Report for the financial year ended 31^st March, 2019 on the financial statements of the Company is a part of this Annual Report.

Cost Auditor:

The Company is required to maintain cost records for certain products as specified by the Central Government under sub-section (1) of Section 148 of the Act, and accordingly such accounts and records are made and maintained in the prescribed manner.

TheBoardofDirectorsoftheCompany,ontherecommendations made by the Audit Committee, has appointed M/s. RA & Co., Cost Accountants, (Firm Registration No. 000242) as the Cost Auditor of the Company to conduct the audit of cost records of certain products for the financial year 2019 - 20.

The remuneration proposed to be paid to the Cost Auditor, subject to ratification by the members of the Company at the ensuing 73^rd AGM, would not exceed Rs. 6.75 lakhs (Rupees six lakhs and seventy five thousand only) excluding taxes and out of pocket expenses, if any.

The Company has received consent from M/s. RA & Co., Cost Accountants, to act as the Cost Auditor for conducting audit of the cost records for the financial year 2019-20 along with a certificate confirming their independence and arm's length relationship.

Secretarial Auditor:

The Board of Directors of the Company has appointed Dr. K R Chandratre, Practicing Company Secretary (Certificate of Practice No. 5144), as the Secretarial Auditor to conduct an audit of the secretarial records for the financial year 2019 - 20. The Company has received consent from Dr. K. R. Chandratre to act as the auditor for conducting audit of the secretarial records for the financial year ending 31^st March, 2019. The Secretarial Audit Report for the financial year ended 31^st March, 2019 under Companies Act, 2013, read with Rules made thereunder and Regulation 24A of the Listing Regulations (including any statutory modification(s) or re-enactment(s) thereof for the time being in force) is set out in the Annexure [C-1] to this report.

The Secretarial Compliance Report for the financial year ended 31^st March, 2019, in relation to compliance of all applicable SEBI Regulations/circulars/ guidelines issued thereunder, pursuant to requirement of Regulation 24A of Listing Regulations is set out in Annexure [C-2] to this report. The Secretarial Compliance Report has been voluntarily disclosed as part of Annual Report as good disclosure practice.

The Secretarial Audit Report and/or Secretarial Compliance Report does not contain any qualification, reservation or adverse remark.

Audit Committee

As on 1^st April, 2019, the Audit Committee comprises of Mr. M. K. Sharma (Chairman), Mr. Abhay Vakil, Mr. R Seshasayee and Mr. Suresh Narayanan. The Board of Directors at their meeting held on 29^th March, 2019 appointed Mr. Suresh Narayanan, Independent Director as a member of the Committee in place of Mr. Mahendra Shah who retired as a Director on 31^st March, 2019. Mr. Jayesh Merchant acts as Secretary to the Audit Committee.

All members of the Audit Committee are financially literate and have experience in financial management.

All the recommendations made by the Audit Committee were accepted by the Board of Directors of the Company.

Corporate Social Responsibility (CSR)

Ason1^stApril,2019,theCSRCommitteecomprisesofMr.Malav Dani (Chairman), Mrs. Vibha Paul Rishi, Mr. KBS Anand and Ms. Amrita Vakil. The Board of Directors at their meeting held on 29^th March, 2019 appointed Ms. Amrita Vakil as a member of the Committee and Mr. Mahendra Choksi and Mr. S Ramadorai ceased to be members of the Committee consequent to their ceasing to be Directors of the Company. Mr. Jayesh Merchant acts as Secretary to the CSR Committee.

During the financial year ended 31^st March, 2019, the Company incurred CSR Expenditure of Rs. 52.70 crores (Rupees fifty two crores and seventy lakhs only). The CSR initiatives of the Company were under the thrust area of health & hygiene, education, water management and vocational training. The CSR Policy of the Company is available on the website of the Company at https://www.asianpaints.com/more/about-us. html.

The Company's CSR Policy statement and annual report on the CSR activities undertaken during the financial year ended 31^st March, 2019, in accordance with Section 135 of the Act and Companies (Corporate Social Responsibility Policy) Rules, 2014 (including any statutory modification(s) or re-enactment(s) thereof for the time being in force) is set out in Annexure [D] to this report.

Corporate Governance Report

In compliance with Regulation 34 of the Listing Regulations, a separate report on Corporate Governance along with a certificate from the Auditors on its compliance forms an integral part of this Annual Report.

Business Responsibility Report

A Business Responsibility Report as per Regulation 34 of the Listing Regulations, detailing the various initiatives taken by the Company on the environmental, social and governance front forms an integral part of this Annual Report.

Extract of Annual Return

The extract of the Annual Return of the Company as on 31^st March, 2019 in Form MGT - 9 in accordance with Section 92 (3) of the Act read with Companies (Management and Administration) Rules, 2014, is available on the website of the Company at https://www.asianpaints.com/more/investors/ financial-results.html and is set out in Annexure [E] to this Report.

Related Party Transactions

During the year under review, the Company revised its Policy on dealing with and Materiality of Related Party Transactions, in accordance with the amendments to the applicable provisions of the Listing Regulations. The Policy is also available on the website of the Company at https://www.asianpaints.com/ more/investors/policies-programs.html.

All contracts/arrangements/transactions entered into by the Company with Related Parties were in ordinary course of business and on arm's length basis.

The Company has not entered into any contracts/ arrangements/transactions with related parties which qualify as material in accordance with the Policy of the Company on materiality of related party transactions.

All transactions with related parties were reviewed and approved by the Audit Committee and are in accordance with the Policy on dealing with and Materiality of Related Party Transactions, formulated by the Company.

There are no materially significant related party transactions that may have potential conflict with interest of the Company at large. There are no person(s) or entities forming part of the Promoter(s)/Promoter(s) Group which individually hold 10% or more shareholding in the Company.

The details of the related party transactions as per Indian Accounting Standards (IND AS) - 24 are set out in Note 42 to the Standalone Financial Statements of the Company.

Form AOC - 2 pursuant to Section 134 (3) (h) of the Companies Act, 2013 read with Rule 8(2) of the Companies (Accounts) Rules, 2014 is set out in the Annexure [F] to this report.

Loans and Investments

Details of loans, guarantees and investments under the provisions of Section 186 of the Act read with the Companies (Meetings of Board and its Powers) Rules, 2014, as on 31^st March, 2019, are set out in Note 37(B) to the Standalone Financial Statements of the Company.

Manufacturing Capacity Expansion

During the year under review, the Company commenced commercial production of water based paints and intermediaries at its following manufacturing facilities, in India: i. Mysuru Plant situated in the state of Karnataka, with an initial capacity of 3 (three) lakh KL p.a., having ultimate capacity of 6(six) lakh KL p.a.

ii. Vishakhapatnam Plant situated in the state of Andhra Pradesh, with an initial capacity of 3 (three) lakh KL p.a., having ultimate capacity of 5(five) lakh KL p.a.

The said expansion will give the Company the ability to ensure it has sufficient capacity to meet future needs.

Risk Management

The Company has a well-defined process in place to ensure appropriate identification and mitigation of risks. Risk identification exercise is inter-woven with the annual planning cycle which ensures both regularity and comprehensiveness. The Risk Management Committee of the Company has been entrusted by the Board with the responsibility of identification of risks at strategic, business, operational and process levels, formulating mitigation plan and actions for the identified risks, which are driven by senior leadership.

The key strategic, business and operational risks which are significant in terms of their impact to the overall objectives of the Company along with status of the mitigation plans are periodically presented and discussed in the Risk Management Committee meetings. Inputs from the Risk Management Committee are duly incorporated in the action plans. All significant risks mitigation plans are well integrated with functional and business plans and are reviewed on a regular basis by the senior leadership.

The Company, through its risk management process, aims to contain the risks within its risk appetite. There are no risks which in the opinion of the Board threaten the existence of the Company. However, some of the risks which may pose challenges are set out in the Management Discussion and Analysis which forms part of this Annual Report.

Vigil Mechanism

The Company has a robust vigil mechanism through its Whistle Blower Policy approved and adopted by Board of Directors of the Company in compliance with the provisions of Section 177 (10) of the Act and Regulation 22 of the Listing Regulations.

The Company has engaged an agency for managing an 'Ethics Hotline' which can be used to, inter alia, report any instances of financial irregularities, breach of code of conduct, abuse of authority, disclosure of financial / price sensitive information, unethical / unfair actions concerning company vendors / suppliers, mala-fide manipulation of Company records, discrimination to the Code of Conduct in an anonymous manner.

The Policy also provides protection to the employees and business associates who report unethical practices and irregularities.

Any incidents that are reported are investigated and suitable action is taken in line with the Whistle Blower Policy.

The Whistle Blower Policy of the Company can be accessed at website of the Company at https://www.asianpaints.com/more/ investors/policies-programs.html.

Policy on Prevention of Sexual Harassment at Workplace

The Company has formulated a Policy on Prevention of Sexual Harassment at Workplace for prevention, prohibition and redressal of sexual harassment at workplace in accordance with the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 (hereinafter referred to as "Prevention of Sexual Harassment Act"). Internal Complaints Committees have also been set up to redress any such complaints received.

The Company is committed to providing a safe and conducive work environment to all of its employees and associates. The Company periodically conducts sessions for employees across the organization to build awareness about the Policy and the provisions of Prevention of Sexual Harassment Act. Complaints of sexual harassment received during the financial year 2018-19 by the Company were investigated in accordance with the procedures prescribed and adequate steps were taken to resolve them.

Internal Financial Controls Related to Financial Statements

The Company has sound internal financial controls commensurate to the size and nature of its business. The Company periodically reviews the internal financial controls in the light of new statutes, changes in business models, adoption of new technology solutions and suggestions for improvements received from employees.

During the year, the Company upgraded its core ERP system to the latest SAP S/4 HANA version. All key internal controls over financial reporting identified as part of the risk and control matrix were thoroughly tested along with the core functionalities before migrating to the new system.

The shared services center (SSC) deployed automation to read digitally signed invoices from select vendors and after necessary validations parks the document in the SAP system. This has increased efficiency and also works towards eliminating manual errors. The Company is in the process of extending this to other vendors in the coming year.

The Company has workflows to ensure adherence to the delegation of authority manual. This manual specifies the limits at a grade level for approval of various expenses, including capital expenditure. For the ones where workflows have not been deployed, the SSC verifies the same before clearing the payments.

For all amendments to Accounting Standards and the new standards notified, the Company carries out a detailed analysis and presents the impact on accounting policies of the Group, the impact on financial results, including revised disclosures to the Audit Committee. The approach and changes in policies are also validated with the statutory auditors. The Company takes steps to make these amendments as part of the underlying ERP systems to the extent possible.

All key controls are periodically tested by the management and few of them are critically tested for adequacy in design and operating effectiveness by the internal auditors of the Company.

The Company has a stated process and periodicity for physical verification of its inventory and fixed assets. Any variances are analysed and accounted post necessary approvals.

Estimates and judgements made in the preparation of financial statements are reviewed closely by the corporate accounts team. Past trends and variances are analysed by the management and verified by the Statutory auditors.

The Company gets its Standalone financial statements audited every quarter by its Statutory Auditors. The policies to ensure uniform accounting treatment are prescribed to the subsidiary companies as well. The accounts of the subsidiary and joint venture companies are audited and certified by their respective Statutory Auditors for consolidation.

Other Disclosures a. Duringtheyearunderreview,theCompanyhasnotaccepted any deposit within the meaning of Sections 73 and 74 of the Act read with the Companies (Acceptance of Deposits) Rules, 2014 (including any statutory modification(s) or re- enactment(s) thereof for the time being in force); b. The Company has complied with Secretarial Standards issued by the Institute of Company Secretaries of India on Meetings of the Board of Directors and General Meetings; c. There are no significant material orders passed by the Regulators or Courts or Tribunals impacting the going concern status of the Company and its operations in future; d. The information on conservation of energy, technology absorption and foreign exchange earnings and outgo as stipulated under Section 134 of the Act read with the Companies (Accounts) Rules, 2014, is set out in the Annexure [G] to this report; e. The Managing Director & CEO of the Company has not received any remuneration or commission from any of the subsidiary companies; f. None of the Auditors of the Company have reported any fraud as specified under the second proviso of Section 143 (12) of the Companies Act, 2013 (including any statutory modification(s) or re-enactment(s) thereof for the time being in force); g. The Company does not have any scheme or provision of money for the purchase of its own shares by employees/ Directors or by trustees for the benefit of employees/ Directors; and h. The Company has not issued equity shares with differential rights as to dividend, voting or otherwise.

Appreciation

The Board of Directors place on record sincere gratitude and appreciation for all the employees at all levels for their hard work, solidarity, cooperation and dedication during the year.

The Board conveys its appreciation for its customers, shareholders, suppliers as well as vendors, bankers, business associates, regulatory and government authorities for their continued support.

For and on behalf of the Board of Directors

Ashwin Dani

Chairman

(DIN: 00009126)

Place : Mumbai,

Date : 9^th May, 2019

Asian Paints Ltd Company Background

Asian Paints Ltd Company Management

Asian Paints Ltd Listing Information

Asian Paints Ltd Finished Product