About Asian Paints Ltd

Asian Paints Ltd is India's largest, Asia's third largest and World's 9th 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. During the year 2018 under review, in order to consolidate, the Company's investments in overseas subsidiary companies, Asian Paints (International) Limited, Mauritius, wholly owned subsidiary was amalgamated with the Company pursuant to an Order dated 29th November, 2017 passed by the Mumbai Bench of the Hon'ble National Company Law Tribunal pursuant to Sections 230 to 232 and 234, other applicable provisions of the Companies Act, 2013 and any other applicable Regulations. The appointed date for the Scheme of amalgamation was 1st January, 2017. The merger was effective 15th January, 2018 after obtaining necessary approvals including approval from the Registrar of Companies, Mauritius. The company acquired the balance 49% of the paid up share capital of Sleek International Private Limited (Sleek) from the Ahuja family for a consideration of Rs 50 Crores. Sleek became a wholly owned subsidiary of the Company. The Company also acquired 100% stake in Reno Chemicals Pharmaceuticals & Cosmetics Private Limited (Reno) for an amount of Rs 159.52 crores (Rupees one hundred fifty nine crores and fifty two lakhs only) with an objective of using the land and building of Reno to meet the Company's growing infrastructure requirements. The Company also fully exited from its operations in the Caribbean region carried on through Lewis Berger (Overseas Holdings) Limited (LBOH), United Kingdom, indirect subsidiary of the Company, for a consideration of Rs 189.16 crores (Rupees one hundred eighty nine crores and sixteen lakhs only) (approx). The divestment was with an objective to focus on its international presence in growing geographies across the continents of Asia and Africa. During the year 2018, the Company resolved to expand the existing paint manufacturing capacity at its unit situated at Ankleshwar, Gujarat, from 1,30,000 KL to 3,00,000 KL per annum and to augment the manufacturing capacity of synthetic resins and emulsions from existing 32,000 MT to 85,000 MT (approx.) over a span of the next 3 - 4 years. The said expansion and augmentation would involve phasing out the current Phthalic Anhydride and its allied products manufactured at this facility. The Company is awaiting necessary approvals from statutory authorities and will thereafter work on this project in a phased manner. During the Year 2019 under review, the Board of Directors at their meeting held on 9th May, 2019, have, inter alia, approved the following investments approximately in accordance with the applicable provisions of law: (i) 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. During 2019, the Company commenced commercial production of water based paints and intermediaries at 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. and at 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. During the year 2020 under review, The Board of Directors of the Company at their meeing held on 22nd January, 2020, approved the Scheme of Amalgamation of Reno Chemicals Pharmaceuticals & Cosmetics Private Limited (Reno), wholly owned subsidiary of the Company with the Company, subject to necessary statutory and regulatory approvals, including approval of the National Company Law Tribunal, Mumbai. The proposed Amalgamation is, inter alia, to maintain a simple corporate structure, eliminate duplicate corporate procedures and reduce multiplicity of legal and regulatory compliances between both the companies. There is no consideration involved as the entire share capital of Reno is held by the Company along with its nominees. The appointed date for the Scheme of Amalgamation is 1st April, 2019 or such other date as may be approved by the National Company Law Tribunal (NCLT) and the Scheme shall be effective from the last date of receipt of all approvals, permissions as may be required or filing of necessary certified copies of Orders under the applicable section(s) of the Act with the Registrar of Companies, Maharashtra at Mumbai. The NCLT vide its Orders dated 22nd April, 2020 and 27th April, 2020, inter alia admitted the Scheme of Amalgamation. Asian Paints International Private Limited, Singapore (APIPL), wholly owned subsidiary of the Company divested its entire stake in Berger Paints Singapore Pte Limited, Singapore (BPS), wholly owned subsidiary of APIPL to Omega Property Investments Pty Ltd, Australia, for a consideration of approx 20.81 crores (Rupees twenty crores and eighty one lakhs) on 17th September, 2019. BPS had a limited presence in the Singapore coatings market and was not material in overall Company's international operations. The company also continued to focus on building capacity across units to support our growth ambitions. The expansion project of the existing plant in Indonesia progressed on schedule. Work also commenced on the companies second plant in Bangladesh. Capacity expansion was completed in Sri Lanka, Nepal and the UAE. The Company has also completed a blueprint for future expansion in Nepal.

Asian Paints Ltd Chairman Speech

Enhancing our value proposition for customers

DEAR SHAREHOLDERS,

The year gone by was one of the most difficult and challenging ones that many of us have faced, and it has impacted our lives in unforeseen ways. The COVID-19 pandemic has cast a shadow of uncertainty and anxiety all over the world, affecting people across all social strata. Through these difficult times, the relentless effort and determination of all the frontline health and social workers has stood out as a beacon of hope for humanity, and I would like to convey my sincere gratitude to them for not only keeping us safe but also helping the economy move forward. On our part, we have participated in the various initiatives of the government and extended our solidarity by donating to various states across the country and also helping large number of hospitals fight this extreme situation. I am also hopeful that if each one of us acts in a responsible manner, we would be able to put this hardship behind us and look towards brighter, healthier and safer days ahead.

Mr. Amit Syngle took over the position of the Managing Director & CEO of our Company right in the midst of a challenging and unprecedented year, and it gives me immense pleasure to note that under his able leadership, we have not only successfully delivered a very strong set of financial results but have also strengthened our capabilities to endure and respond to such uncertainties. Under his leadership we embraced new challenges and the Asian Paints Group has responded to many adversities with unflinching commitment to our consumers, communities and citizens, finding ingenious ways and means to reach out to them.

Realigning our priorities

As we started the financial year 2020-21 in the midst of the nationwide lockdown, our first and foremost priority was to ensure the health and well-being of all our employees, direct as well as indirect, by setting up work-from-home infrastructure and ensuring safe, sanitized workplaces at our manufacturing plants and various sales locations across the country. The other key priority was to open up access to our customer and the extension of our Health & Hygiene product portfolio through the sanitizers & disinfectants range, for varied surfaces and usage, coupled with our 'San Assure' sanitization service and 'Safe Painting' solutions.

It helped us open our dealer network and provide safe

As an organisation, we have always upheld the highest standards of corporate governance, which has been the bedrock for our growth as a sustainable, responsible corporate citizen. solutions to our customers. This further strengthened our brand salience in the 'Health & Hygiene' category and reinforced Asian Paints as the 'most preferred brand' for our customers. Looking at the huge strain on the public infrastructure due to the pandemic, we also pushed for community safety measures, supporting various local administrations, state governments as well as the central government in providing personal protective equipment, sanitization products and services.

Handholding the customer

In my last communication, I had mentioned that for an organisation to grow and retain its market leadership, it had to guide its customers through the new normal that would emerge out of our collective experiences of this pandemic, and fulfil their requirements through innovative ideas, products and solutions. As we continued to manage the business dynamically to address the uncertainties in the wake of the pandemic, we continued to enhance our focus on understanding the changing customer needs and aspirations across our businesses, and address these through new products and solutions with a strong value proposition for our customers.

Our focus on new categories and new products have yielded us new gains and also given us unique strengths. During the year, we further augmented our Home Decor capabilities, introducing offerings in Lightings, Furnishings and Furniture to cater to customer aspirations. We also partnered with multiple designers, architects, and end-delivery contractors to launch our 'Beautiful Homes Service' that offers end-to-end services - from personalised interior design to professional execution.

In the Industrial Coatings business, we launched a comprehensive Asset Protection Management service, thereby strengthening our relationship with key customers. Many of these new products and solutions were also rolled out in our global markets with relevant market-specific customisations.

As an organisation, we have always upheld the highest standards of corporate governance, which has been the bedrock for our growth as a sustainable, responsible corporate citizen. To further enhance the governance standards, the Board of Directors constituted an Investment Committee to focus on our strategic direction and initiatives.

Looking ahead

As we look at navigating the business forward in the new financial year, uncertainties have resurfaced with the emergence of a strong, second wave of the COVID-19 pandemic. The situation has also worsened in many of our markets in South Asia and the Middle East, with infection numbers surpassing previous peaks. While governments are keen to accelerate vaccination, only an effective drive covering a large proportion of the population, will help us contain this spread.

In the meantime, safety and well-being will remain our highest priority. We will focus on addressing business challenges with agility, working closely with our business partners and stakeholders. I am confident that with the guidance of our experienced Board, dynamic leadership of the management team, and the commitment of our employees, we will not just overcome the challenges but convert these very challenges into opportunities to move to an even higher trajectory of sustainable growth.

WARM REGARDS,

Ashwin Dani

Chairman

Asian Paints Ltd Company History

Asian Paints Ltd is India's largest, Asia's third largest and World's 9th 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. During the year 2018 under review, in order to consolidate, the Company's investments in overseas subsidiary companies, Asian Paints (International) Limited, Mauritius, wholly owned subsidiary was amalgamated with the Company pursuant to an Order dated 29th November, 2017 passed by the Mumbai Bench of the Hon'ble National Company Law Tribunal pursuant to Sections 230 to 232 and 234, other applicable provisions of the Companies Act, 2013 and any other applicable Regulations. The appointed date for the Scheme of amalgamation was 1st January, 2017. The merger was effective 15th January, 2018 after obtaining necessary approvals including approval from the Registrar of Companies, Mauritius. The company acquired the balance 49% of the paid up share capital of Sleek International Private Limited (Sleek) from the Ahuja family for a consideration of Rs 50 Crores. Sleek became a wholly owned subsidiary of the Company. The Company also acquired 100% stake in Reno Chemicals Pharmaceuticals & Cosmetics Private Limited (Reno) for an amount of Rs 159.52 crores (Rupees one hundred fifty nine crores and fifty two lakhs only) with an objective of using the land and building of Reno to meet the Company's growing infrastructure requirements. The Company also fully exited from its operations in the Caribbean region carried on through Lewis Berger (Overseas Holdings) Limited (LBOH), United Kingdom, indirect subsidiary of the Company, for a consideration of Rs 189.16 crores (Rupees one hundred eighty nine crores and sixteen lakhs only) (approx). The divestment was with an objective to focus on its international presence in growing geographies across the continents of Asia and Africa. During the year 2018, the Company resolved to expand the existing paint manufacturing capacity at its unit situated at Ankleshwar, Gujarat, from 1,30,000 KL to 3,00,000 KL per annum and to augment the manufacturing capacity of synthetic resins and emulsions from existing 32,000 MT to 85,000 MT (approx.) over a span of the next 3 - 4 years. The said expansion and augmentation would involve phasing out the current Phthalic Anhydride and its allied products manufactured at this facility. The Company is awaiting necessary approvals from statutory authorities and will thereafter work on this project in a phased manner. During the Year 2019 under review, the Board of Directors at their meeting held on 9th May, 2019, have, inter alia, approved the following investments approximately in accordance with the applicable provisions of law: (i) 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. During 2019, the Company commenced commercial production of water based paints and intermediaries at 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. and at 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. During the year 2020 under review, The Board of Directors of the Company at their meeing held on 22nd January, 2020, approved the Scheme of Amalgamation of Reno Chemicals Pharmaceuticals & Cosmetics Private Limited (Reno), wholly owned subsidiary of the Company with the Company, subject to necessary statutory and regulatory approvals, including approval of the National Company Law Tribunal, Mumbai. The proposed Amalgamation is, inter alia, to maintain a simple corporate structure, eliminate duplicate corporate procedures and reduce multiplicity of legal and regulatory compliances between both the companies. There is no consideration involved as the entire share capital of Reno is held by the Company along with its nominees. The appointed date for the Scheme of Amalgamation is 1st April, 2019 or such other date as may be approved by the National Company Law Tribunal (NCLT) and the Scheme shall be effective from the last date of receipt of all approvals, permissions as may be required or filing of necessary certified copies of Orders under the applicable section(s) of the Act with the Registrar of Companies, Maharashtra at Mumbai. The NCLT vide its Orders dated 22nd April, 2020 and 27th April, 2020, inter alia admitted the Scheme of Amalgamation. Asian Paints International Private Limited, Singapore (APIPL), wholly owned subsidiary of the Company divested its entire stake in Berger Paints Singapore Pte Limited, Singapore (BPS), wholly owned subsidiary of APIPL to Omega Property Investments Pty Ltd, Australia, for a consideration of approx 20.81 crores (Rupees twenty crores and eighty one lakhs) on 17th September, 2019. BPS had a limited presence in the Singapore coatings market and was not material in overall Company's international operations. The company also continued to focus on building capacity across units to support our growth ambitions. The expansion project of the existing plant in Indonesia progressed on schedule. Work also commenced on the companies second plant in Bangladesh. Capacity expansion was completed in Sri Lanka, Nepal and the UAE. The Company has also completed a blueprint for future expansion in Nepal.

Asian Paints Ltd Directors Reports

Dear Members,

The Board of Directors are pleased to present the 75 ^th Integrated Annual Report of the Company along with the audited financial statements (standalone and consolidated) for the financial year 2020-21.

FINANCIAL RESULTS

"Comprise of impairment provision towards investment made in Sleek International Private Limited & Maxbhumi Developers Limited, wholly owned subsidiary companies of the Company of Rs. 29.7 crores and Rs. 3.5 crores respectively.

COMPANY PERFORMANCE OVERVIEW

During the financial year 2020-21:

• During the financial year 2020-21, revenue from operations on standalone basis increased to Rs. 18,516.86 crores as against Rs. 17,194.09 crores in the previous year - a growth of 7.7%.

• Cost of goods sold as a percentage to revenue from operations decreased to 54.5% as against 55.3% in the previous year.

• Employee cost as a percentage to revenue from operations increased to 6.1% ( Rs. 1,128.66 crores) as against 5.7% (? 985.43 crores) in the previous year.

• Other expense as a percentage to revenue from operations decreased to 15.2% ( Rs. 2,812.48 crores) as against 16.5 % ( Rs. 2,845.44 crores) in the previous year.

• The Company has contributed approximately a sum of Rs. 10 crores towards COVID-19 pandemic related relief activities.

• The Profit after Tax for the current year is Rs. 3,052.51 crores as against Rs. 2,653.95 crores in the previous year - a growth of 15.0%.

• On a consolidated basis, the group achieved revenue of Rs. 21,712.29 crores as against Rs. 20,21 1.25 crores - a growth of 7.4%. Net profit after non-controlling interest for the group for the current year is Rs. 3,139.29 crores as against Rs. 2,705.17 crores in the previous year - a growth of 16.0%.

TRANSFER TO RESERVES

During the year under review, there was no amount transferred to any of the reserves by the Company.

DIVIDEND

The Board of Directors at their meeting held on 12^th May, 2021, has recommended payment of Rs. 14.50 (Rupees fourteen and paise fifty only) (1450%) per equity share of the face value of Rs. 1 (Rupee one only) each as final dividend for the financial year ended 31^st March, 2021. The payment of final dividend is subject to the approval of the shareholders at the ensuing Annual General Meeting (AGM) of the Company.

During the year under review, the Board of Directors of the Company at their meeting held on 22^nd October, 2020, declared an Interim dividend of Rs. 3.35 (Rupees three and paise thirty five only) (335%) per equity share of the face value of Rs. 1 (Rupee one only) each. The interim dividend was paid to the shareholders on 12^th November, 2020.

The total dividend amount for the financial year 2020-21, including the proposed final dividend, amounts to Rs. 17.85 (Rupees seventeen and paise eighty five only) per equity share of the face value of Rs. 1 (Rupee one only) each

[total dividend payout for the FY 2020-21 amounting to Rs. 1,712.17 crores (Rupees one thousand seven hundred twelve crores and seventeen lakhs only)] as against the total dividend of Rs. 12 (Rupees twelve only) per equity share of the face value of Rs. 1 (Rupee one only) each paid for the previous financial year 2019-20 [total dividend payout for the FY 2019-20 amounting to Rs. 1,151.04 crores (Rupees one thousand one hundred fifty one crores and four lakhs only)].

In view of the changes made under the Income-tax Act, 1961, by the Finance Act, 2020, dividends paid or distributed by the

Company shall be taxable in the hands of the Shareholders. The Company shall, accordingly, make the payment of the final dividend after deduction of tax at source.

The dividend recommended is in accordance with the Dividend Distribution Policy of the Company. The Dividend Distribution Policy, in terms of Regulation 43A of the Securities and

Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations") is available on the Company's website: https://www. asianDaints.com/more/investors/Dolicies-Droarams.html.

The dividend payout ratio of the Company since last three financial years is more than 50%.

UNCLAIMED DIVIDEND

Pursuant to the applicable provisions of the Companies Act, 2013 ("the Act") read with the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 ("the IEPF Rules"), during the year, unpaid or unclaimed dividend amounting to Rs. 1.34 crores was transferred by the Company to the Investor Education and Protection Fund ("IEPF"), established by the Government of India.

Further, 1,43,738 shares were transferred to the demat account of the IEPF Authority during the year, in accordance with IEPF Rules, as the dividend has not been paid or claimed by the shareholders for 7 (seven) consecutive years or more.

SUBSIDIARIES & ASSOCIATE COMPANIES

The Company has 23 subsidiaries and 2 joint-venture companies as on 31^st March, 2021.

Financial Performance

A list of bodies corporates which are subsidiaries/associates/ joint ventures of the Company is provided as part of the notes to Consolidated Financial Statements.

A separate statement containing the salient features of financial statements of subsidiaries, associates, 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 Rules.

The Company does not have any material subsidiary.

Consolidated Financial Statements

In accordance with the provisions of the Act, Regulation 33 of the Listing Regulations and applicable Accounting Standards, the Audited Consolidated Financial Statements of the Company for the financial year 2020-21, together with the Auditors' Report form part of this Annual Report.

In accordance with Section 136 of the Act, the audited financial statements, including the CFS and related information of the Company and the financial statements of each of the subsidiary companies, are available on our website, www.asianpaints.com. Any Member desirous of making inspection or obtaining copies of the said financial statements may write to the Company Secretary at investor.relations@asianpaints.com.

The Company's Policy for determining material subsidiaries may be accessed on the website of the Company at https://www. asianpaints.com/more/investors/policies-programs.html.

Amalgamation of Reno Chemicals Pharmaceuticals & Cosmetics Private Limited with the Company

The Company Petition filed for amalgamation of Reno Chemicals Pharmaceuticals & Cosmetics Private Limited, Company's wholly owned subsidiary with the Company was admitted on 26^th April, 2021 by Hon'ble National Company Law Tribunal, Mumbai (NCLT).

The said Petition is listed for final hearing before the Hon'ble NCLT.

Merger of Asian Paints (Lanka) Limited with Causeway Paints Lanka (Private) Limited

With effect from 1^st April, 2021, indirect subsidiary of the Company, Asian Paints (Lanka) Limited amalgamated with Causeway Paints Lanka (Private) Limited.

Winding-up of Asian Paints (Tonga) Limited

Asian Paints (Tonga) Limited has ceased its business operations w.e.f. 10^th December, 2020 and liquidated all its assets & liabilities. The name of the Company was struck off from the Business Registries Office, Kingdom of Tonga on 29^th January, 2021.

ASIAN PAINTS EMPLOYEES' STOCK OPTION PLAN

The Board of Directors of the Company at their meetings held on 30^th March, 2021 and 12^th May, 2021, based on the recommendations of the Nomination and Remuneration Committee, approved formulation of Asian Paints Employees' Stock Option Plan 2021 ("2021 Plan"), for grant of stock options to 'Eligible Employees' of the Company and its subsidiary companies. This 2021 Plan will be effective from the financial year 2020-21 onwards and is subject to approval of the shareholders at the ensuing AGM of the Company. The 2021 Plan has been introduced for eligible employees of the Company and/or its subsidiary companies with an objective to motivate and retain professionals by rewarding performance, and in order to further increase shareholder value.

The 2021 Plan is intended to cover Eligible Employees of the Company and its subsidiary companies, including the Managing Director & CEO of the Company. As such, Mr. Amit Syngle, Managing Director & CEO, shall also be eligible to participate in the 2021 Plan.

The appointment and remuneration of Mr. Amit Syngle as the Managing Director & CEO, was approved by the shareholders of the Company in the 74^th AGM of the Company held on 5^th August, 2020 ("Original Resolution").

It is proposed to amend the Original Resolution to include appropriate clauses enabling the grant of stock options to Mr. Amit Syngle, pursuant to the 2021 Plan.

The brief details of the 2021 Plan and other relevant details have been provided in explanatory statement annexed to the Notice of the ensuing 75^th AGM of the Company.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

Board of Directors

Re-appointment and continuation of Mr. R. Seshasayee as an Independent Director of the Company, not liable to retire by rotation.

At the 71^st AGM of the Company held on 27^th June, 2017, the shareholders had approved the appointment of Mr. R Seshasayee (DIN: 00047985) as an Independent Director to hold office for a period of 5 (five) consecutive years up to 22^nd January, 2022.

Based on the outcome of performance evaluation and recommendations of the Nomination and Remuneration Committee, the Board of Directors of the Company, at their meeting held on 12^th May, 2021 have recommended the reappointment of Mr. R Seshasayee as an Independent Director for second term of 5 (five) consecutive years upto 22^nd January, 2027 (not liable to retire by rotation), in accordance with Section 149, 152, Schedule IV and other applicable provisions, if any, of the Act and the Listing Regulations.

In terms of the provisions of the Regulation 17(1A) of the

Listing Regulations, consent of the Shareholders by way of Special Resolution shall be required for continuation of directorship of Mr. R. Seshasayee, Independent Director of the Company, who would attain the prescribed age limit of 75 years during the period of the proposed second term.

In the opinion of the Nomination & Remuneration Committee and Board of Directors of the Company, considering the wealth of experience and expertise of Mr. R Seshasayee and the immense value he brings to the Board and the Company, the re-appointment of Mr. R Seshasayee for a second term of 5 (five) consecutive years from 23^rd January, 2022 to 22^nd January, 2027 (not liable to retire by rotation) and continuation of his directorship beyond 75 (seventy-five) years of age would be in the interest of the Company and its shareholders. Mr. R. Seshasayee is exempt from the requirement to undertake online proficiency self-assessment test conducted by Indian Institute of Corporate Affairs (IICA), Manesar.

Retirement by rotation and subsequent re-appointment

In accordance with the provisions of Section 152 and other applicable provisions, if any, of the Act and the Articles of Association of the Company, Mr. Abhay Vakil and Mr. Jigish Choksi, Non-Executive Directors of the Company, are liable to retire by rotation at the ensuing AGM and being eligible have offered themselves for re-appointment.

The Managing Director & CEO and Independent Directors of the Company are not liable to retire by rotation.

Declaration from Directors

The Company has received the following declarations from all the Independent Directors confirming that:

1. They meet the criteria of independence as prescribed under the provisions of the Act, read with the Schedule and Rules issued thereunder, and the

Listing Regulations. There has been no change in the circumstances affecting their status as Independent Directors of the Company; and

2. They have registered themselves with the Independent

Director's Database maintained by the IICA.

None of the Directors of the Company are disqualified for being appointed as Directors as specified in Section 164(2) of the Act and Rule 14(1) of the Companies (Appointment and Qualification of Directors) Rules, 2014.

Key Managerial Personnel

Mr. Amit Syngle, Managing Director & CEO and Mr. R. J. Jeyamurugan, CFO & Company Secretary, are the Key Managerial Personnel of the Company.

Mr. Amit Syngle was appointed as the Managing Director & CEO of the Company with effect from 1^st April, 2020. During the year under review, there were no other changes to the Key Managerial Personnel of the Company.

NUMBER OF MEETINGS OF THE BOARD

During the year under review, 7 (seven) meetings of the Board of Directors were held. The details of the meetings of

the Board of Directors of the Company held and attended by the Directors during the financial year 2020-21 are given in the Corporate Governance Report which forms part of this Annual Report.

The maximum interval between any two meetings did not exceed 120 days, as prescribed by the Act.

NOMINATION AND REMUNERATION POLICY The Nomination and Remuneration Policy of the Company, inter alia, provides that the Nomination and Remuneration Committee shall, formulate the criteria for Board membership, including the appropriate mix of Executive & Non-Executive Directors, Board Diversity and approve and recommend compensation packages and policies for Directors and Senior Management and lay down the effective manner of performance evaluation of the Board, its Committees and the Directors and such other matters as provided under Section 178 of the Act and Listing Regulations.

The salient features of the Nomination and Remuneration Policy of the Company are outlined in the Corporate Governance Report which forms part of this Annual

Report. The Policy is also available on the website of the Company httDs://www.asianDaints.com/more/investors/ Dolicies-Droarams.html.

REMUNERATION OF DIRECTORS, KEY MANAGERIAL PERSONNEL AND SENIOR MANAGEMENT

The remuneration paid to the Directors, Key Managerial Personnel and Senior Management is in accordance with the Nomination and Remuneration Policy formulated in accordance with Section 178 of the Act and Regulation 19 read with Schedule II of the Listing Regulations. Further details on the same are given in the Corporate Governance Report which forms part of this Annual Report.

The information required under Section 197 of the Act read with Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of Directors/ employees of the Company is set out in the Annexure [A] to this report and is also available on the website of the Company at www.asianpaints.com.

BOARD EVALUATION

During the year under review, the Nomination and Remuneration Committee engaged M/s. Egon Zehnder, external consultants, to conduct evaluation of the Board, Committees of the Board and Directors. The evaluation was conducted based on the criteria and framework adopted by the Board. The evaluation parameters and the process have been explained in the Corporate Governance Report.

FAMILIARIZATION PROGRAM FOR INDEPENDENT DIRECTORS

All I ndependent Directors are familiarized with the operations and functioning of the Company. The details of the training and familiarization program are provided in the Corporate

Governance Report.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to Section 134 of the Act, the Directors of the Company state that:

a. in the preparation of the annual accounts for the financial year ended 31^st March, 2021, the applicable

Asian Paints Limited

Board's Report (Contd.)

Accounting Standards 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, 2021 and of the profits of the Company for the financial year ended 31^st March, 2021;

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.

REGISTRAR AND TRANSFER AGENT

M/s. TSR Darashaw Consultants Private Limited (TSR) is the Registrar and Transfer Agent of the Company.

During the year under review, the registered office and place of operation of TSR has been shifted to Vikhroli, Mumbai.

Accordingly, the Company is required to seek shareholders' approval under Section 94 and other applicable provisions of the Act read with the Companies (Management and Administration) Rules, 2014, for maintenance of the Registers and Indexes of Members of the Company under Section 150 of the Companies Act, 1956 or Section 88 of the Act, as applicable and copies of the returns prepared under Section 159 of the Companies Act, 1956 or Section 92 of the Act, as applicable, read with the Companies (Management and Administration) Rules, 2014 and in accordance with Article 144 of the Articles of Association of the Company, for the period(s) on or after 1^st April, 2003, at TSR's office located in Vikhroli, Mumbai.

Appropriate resolution seeking approval of the shareholders has been placed at the ensuing AGM of the Company.

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.

AUDITORS AND AUDITORS' REPORT

Statutory Auditor

M/s. Deloitte Haskins & Sells LLP, Chartered Accountants (Firm Registration No. 1 17366W/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 ensuing 75^th AGM.

M/s. Deloitte Haskins & Sells LLP, Chartered Accountants are eligible to be re-appointed for a further term of 5 (five) years, in terms of provisions of Sections 139 and 141 of the Act.

Accordingly, the Board of Directors of the Company at their meeting held on 12^th May, 2021 on the recommendation of the Audit Committee and subject to the approval of the shareholders of the Company at the ensuing AGM, have approved the re-appointment of M/s. Deloitte Haskins & Sells LLP, Chartered Accountants (Firm Registration No. 117366W/ W-100018), as the Statutory Auditors, for a further period of 5 (five) years i.e. from the conclusion of the 75^th AGM till the conclusion of 80^th AGM of the Company.

The Company has received written consent and certificate of eligibility in accordance with Sections 139, 141 and other applicable provisions of the Act and Rules issued thereunder, from M/s. Deloitte Haskins & Sells LLP. They have confirmed to hold a valid certificate issued by the Peer Review Board of the Institute of Chartered Accountants of India (ICAI) as required under the Listing Regulations.

The Auditors have issued an unmodified opinion on the Financial Statements, both standalone and consolidated for the financial year ended 31^st March, 2021. The said Auditors' Report(s) for the financial year ended 31^st March, 2021 on the financial statements of the Company forms part of this Annual Report.

Cost Auditor

The Company has maintained cost records for certain products as specified by the Central Government under sub-section (1) of Section 148 of the Act. M/s. RA & Co.,

Cost Accountants, (Firm Registration No. 000242) have carried out the cost audit for applicable products during the financial year 2020-21.

The Board of Directors of the Company, on the recommendations made by the Audit Committee, have appointed M/s. RA & Co., as the Cost Auditors of the Company to conduct the audit of cost records of certain products for the financial year 2021-22. M/s. RA & Co., being eligible, have consented to act as the Cost Auditors of the Company for the financial year 2021-22.

The remuneration proposed to be paid to the Cost Auditor, subject to ratification by the members of the Company at the ensuing 75^th AGM, would not exceed Rs. 8 lakhs (Rupees eight lakhs only) excluding taxes and out of pocket expenses, if any.

Secretarial Auditor

The Board of Directors of the Company have 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 2021-22. The Company has received consent from Dr. K.

124 Annual Report 2020-21

R. Chandratre to act as the auditor for conducting audit of the secretarial records for the financial year ending 31^st March, 2022.

The Secretarial Audit Report for the financial year ended 31^st March, 2021 under the Act, read with Rules made thereunder and Regulation 24A of the Listing Regulations, is set out in the Annexure [B-1] to this report.

The Secretarial Compliance Report for the financial year ended 31^st March, 2021, in relation to compliance of all applicable SEBI Regulations/circulars/guidelines issued thereunder, pursuant to requirement of Regulation 24A of the Listing Regulations, is set out in Annexure [B-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.

COMMITTEES OF THE BOARD

As on 31^st March, 2021, the Board has 7 (seven) committees: Audit Committee, Nomination and Remuneration Committee,

Corporate Social Responsibility Committee, Risk Management Committee, Stakeholders Relationship Committee, Investment Committee and Shareholders Committee.

During the year under review, the Board of Directors constituted a committee called the Investment Committee, inter alia, to consider, evaluate and recommend to the Board viable investment proposals which are in the interest of furthering the strategic goals of the Company.

During the year, all recommendations made by the committees were approved by the Board.

A detailed note on the composition of the Board and its committees, including its terms of reference is provided in the Corporate Governance Report. The composition and terms of reference of all the Committee(s) of the Board of Directors of the Company is in line with the provisions of the Act and Listing Regulations.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

During the financial year ended 31^st March, 2021, the Company incurred CSR Expenditure of Rs. 62.98 crores (Rupees sixty two crores and ninety eight lakhs). 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 httDs://www.asianDaints.com/about-us.html.

Ministry of Corporate Affairs vide its Notification(s) dated

22^nd January, 2021, notified the Companies (Corporate Social Responsibility Policy) Amendment Rules, 2021, which, inter alia, provides for the revised format of annual report for publishing the CSR activities undertaken during the financial year ended 31^st March, 2021. The other changes pursuant to said Notification(s) under the CSR provisions, have been briefly highlighted in the annual report of the Company's CSR activities for the financial year ended 31^st March, 2021.

The Company's CSR Policy statement and annual report on the CSR activities undertaken during the financial year ended 31^st March, 2021, in accordance with Section 135 of the Act and Companies (Corporate Social Responsibility Policy) Rules, 2014 is set out in Annexure [C] to this report.

CORPORATE GOVERNANCE REPORT AND BUSINESS RESPONSIBILITY 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 and 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 part of this Annual Report.

ANNUAL RETURN

The Annual Return of the Company as on 31^st March, 2021 in Form MGT - 7 in accordance with Section 92(3) of the Act read with the Companies (Management and Administration) Rules, 2014, is available on the website of the Company at httDs://www.asianDaints.com/more/investors/ AnnualReportFY2021.html.

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 and the Related Party Framework, formulated and adopted by the Company. An omnibus approval from the Audit Committee is obtained for the related party transactions which are unforeseen in nature. During the year under review, the Related Policy Framework was suitably amended to include the revised pricing structure and certain new transactions which were not anticipated earlier.

All contracts/arrangements/transactions entered into by the Company during the year under review with Related Parties were in the ordinary course of business and on arm's length basis in terms of provisions of the Act.

The Company's Policy on dealing with and Materiality of Related Party Transactions is available on the website of the Company at httDs://www.asianDaints.com/more/investors/ Dolicies-Droarams.html.

There are no materially significant related party transactions that may have potential conflict with interest of the Company at large. There were no transactions of the Company with any person or entity belonging to the Promoter(s)/Promoter(s) Group which individually holds 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 43 to the Standalone Financial Statements of the Company.

The Company in terms of Regulation 23 of the Listing Regulations submits within 30 days from the date of publication of its standalone and consolidated financial results for the half year, disclosures of related party transactions on a consolidated basis, in the format specified in the relevant accounting standards to the stock exchanges. The said disclosures can be accessed on the website of the Company at https://www. asianpaints.com/more/investors/announcements.html.

Form AOC-2 pursuant to Section 134(3)(h) of the Act read with Rule 8(2) of the Companies (Accounts) Rules, 2014 is set out in the Annexure [D] 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, 2021, are set out in Note 36(B) to the Standalone Financial Statements of the Company.

RISK MANAGEMENT

Risk management is integral to your Company's strategy and for the achievement of our long-term goals. Our success as an organization depends on our ability to identify and leverage the opportunities while managing the risks.

The COVID-19 pandemic this year has posed several unprecedented challenges in the form of uncertain lockdowns, unlock phases, health hazards and supply chain disruptions across the globe. These have added a new dimension to the term VUCA (volatile, uncertain, complex and ambiguous).

These changes and challenges have brought a mix of opportunities and uncertainties impacting the Company's objectives. Risk Management, which aims at managing the impact of these uncertainties, is an integral part of the Company's strategy setting process. The Company regularly identifies uncertainties and after assessing them, devises short-term and long-term actions to mitigate any risk which could materially impact your Company's long-term goals. This process of identifying and assessing the risks is a two-way process. Inputs are taken, both bottom up and top down while finalizing the risk treatment plans.

The Risk Management Committee of the Company has been entrusted by the Board with the responsibility of reviewing the risk management process in the Company and ensuring that the risks are brought within acceptable limits.

Our approach to risk management is designed to provide reasonable assurance that our assets are safeguarded, the risks facing the business are being assessed and mitigated and all information that may be required to be disclosed is reported to Company's Senior Management including, where appropriate, the Managing Director & CEO, the Chief Financial Officer, the Audit Committee, the Risk Management Committee and the Board.

Mitigation plans to significant risks are well integrated with functional and business plans and are reviewed on a regular basis by the senior leadership.

The Company endeavors to continually sharpen its Risk Management systems and processes in line with a rapidly changing business environment. 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/ unpublished price sensitive information other than for legitimate purposes, unethical/unfair actions concerning Company vendors/suppliers, malafide manipulation of Company records, discrimination to the Code of Conduct in an anonymous manner.

The Policy also provides adequate protection to the Directors, 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/Dolicies-Droorams.html.

POLICY ON PREVENTION OF SEXUAL HARASSMENT AT WORKPLACE

As per the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 ("Prevention of Sexual Harassment Act"), the Company has formulated a Policy on Prevention of Sexual Harassment at Workplace for prevention, prohibition and redressal of sexual harassment at workplace and an Internal Complaints Committees has 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 2020-21 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 adequate Internal Financial Controls System over financial reporting which ensures that all transactions are authorized, recorded, and reported correctly in a timely manner. The Company's Internal Financial Control over financial reporting is designed to provide reliable financial information and to comply with applicable accounting standards.

The Company has laid down Standard Operating Procedures and policies to guide the operations of the business. Functional heads are responsible to ensure compliance with all laws and regulations and also with the policies and procedures laid down by the Management.

During the year, the Company has updated the delegation of Authority Manual and Commercial Manual to make it in line with the changes in the business environment and underlying systems and processes. The Company has modified the format of the internal certification by functional heads on reporting accuracy (Financial Closure Certificate (FCC)) in line with the changes in accounting and reporting requirements.

The Shared Services Center (SSC) extended the coverage of digital invoice processing for transporters during the year.

This has made the process touchless and seamless. Vendor Invoice Process Automation & Transporter Invoice Process Automation has inbuilt 3-way checks (PO, GR/Service Entry & invoice) in the system leading to accuracy and lower manual errors. To increase the digital footprints with added control, employee reimbursement and digital invoices are processed paperless.

The Company has invested in automation of inventory provisions for damaged, dead, defective, inert stock, etc. leading to robust review and faster closure of financial.

The Company has developed system with built in checks to ensure that GST and tax is collected at source correctly for all applicable transactions ensuring statutory compliance. The Company has also completed development to generate E-invoice through the system as per the government regulations.

The Company periodically tracks all amendments to Accounting Standards and makes changes to the underlying systems, processes and financial controls to ensure adherence to the same. All resultant changes to the policy and impact on financials are disclosed after due validation with the statutory auditors and the Audit Committee.

Corporate accounts function is actively involved in designing large process changes as well as validating changes to IT systems that have a bearing on the books of accounts.

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. International subsidiaries provide information required for consolidation of accounts in the format prescribed by the Company. The accounts of the subsidiary and joint venture companies are audited and certified by their respective Statutory Auditors for consolidation.

OTHER DISCLOSURES

a. None of the Directors of the Company have resigned during the year under review;

b. There are no material changes and commitments affecting the financial position of the Company which have occurred between the end of the financial year 2020-21 and the date of this report;

c. During the year under review, the Company has launched its Home Decor Range in furniture, furnishings and lighting through 'Beautiful Homes'. This was in line with the Company's vision of providing its customers complete home decor solution. There has been no other change in the nature of business carried out by the Company.

d. During the year under review, the Company has not accepted any deposit within the meaning of Sections 73 and 74 of the Act read with the Companies (Acceptance of Deposits) Rules, 2014;

e. 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;

f. 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;

The Competition Commission of India had passed a prima facie Order dated 14^th January, 2020, directing the Director General (DG) to cause an investigation against the Company, under the provisions of Section 26(1) of the Competition Act, 2002. This Order is for initiating an investigation against the Company under the relevant provisions of the Competition Act, but it in no way affects the going concern status of the Company. The investigation is currently ongoing and the Company is fully co-operating and providing necessary information to the authority.

g. The Managing Director & CEO of the Company has not received any remuneration or commission from any of the subsidiary companies. Further the Company doesn't have any Holding Company;

h. None of the Auditors of the Company have reported any fraud as specified under the second proviso of Section 143(12) of the Act;

i. 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 [E] to this report;

j. The Company has formulated Asian Paints Employees Stock Option Plan 2021 (ESOP) for Eligible Director(s) and Employees of the Company and its subsidiaries, which is subject to approval of the shareholders at the ensuing AGM. Hence, the disclosure requirement in relation to ESOP under Rule 12(9) and Rule 16(4) of the Companies (Share Capital and Debentures) Rules, 2014 is not applicable yet;

k. The Company has not issued equity shares with differential rights as to dividend, voting or otherwise;

l. The Company has not issued any sweat equity shares to its directors or employees;

m. There was no revision of financial statements and Board's Report of the Company during the year under review;

n. No application has been made under the Insolvency and Bankruptcy Code; hence the requirement to disclose the details of application made or any proceeding pending under the Insolvency and Bankruptcy Code, 2016 (31 of 2016) during the year alongwith their status as at the end of the financial year is not applicable; and

o. The requirement to disclose the details of difference between amount of the valuation done at the time of onetime settlement and the valuation done while taking loan from the Banks or Financial Institutions along with the reasons thereof, is not applicable.

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

Asian Paints Ltd Company Background

Asian Paints Ltd Company Management

Asian Paints Ltd Listing Information

Asian Paints Ltd Finished Product