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

Transitions

Yet another exciting and challenging year came to a close at Asian Paints. It has truly been a year of many learnings.

As always, we worked relentlessly to offer solutions that deliver enhanced value to a wide cross section of consumers, communities and citizens. Despite a difficult economic environment, we registered healthy growth in each of the first three quarters. The lockdown in March this year affected performance in the last quarter and to an extent cast its impact on the results for year. Viewed in the context of the challenges, we were able to deliver a good performance and make considerable progress across businesses.

After a journey spanning four decades and many roles,

Mr. KBS Anand retired as Managing Director and CEO of the Company. Under his able leadership, the Company moved from being a product-centric to a consumer and service-oriented brand, forayed into Home Improvement, made international acquisitions and established world-class manufacturing plants. His contribution to our growth and development have been truly commendable.

Despite a difficult economic environment, we registered healthy growth in each of the first three quarters

Mr. Amit Syngle, who has succeeded Mr. KBS Anand is a veteran with thirty years of experience in the Company. Credited with game-changing innovations in marketing colour, introducing new age retailing and envisioning product innovations in the industry, Amit brings strong and determined leadership which, I am sure, will take the Company to new heights. Another leadership change was the appointment of Mr. R J Jeyamurugan as Company Secretary and CFO, in place of Mr. Jayesh Merchant who retired after an illustrious 17 years in the organisation.

I am confident that the Company will benefit immensely under the guidance of the new leadership.

Key Areas of Focus

The unexpected events towards the close of the year notwithstanding, Asian Paints achieved many milestones in FY 2019-20. The Decorative business focused on product innovations and growing the overall market in various areas like value for money emulsions, innovative solutions in the waterproofing and construction chemicals segment and more inspiring options in Home decor. In the Home Improvement business, some of the developments in the year included new choices in the Full Kitchen business and a strengthened offering in sanitaryware business. On the International front, attention was on re-energising our business in markets like Egypt, Bangladesh and Sri Lanka which were performing below their potential. The industrial business saw emphasis being put on certain key areas in protective coatings and improved product offerings.

People and the Community

Being one with the community of which we are a part and playing an active role in its development and progress has been an integral aspect of our philosophy. Our Colour Academies continued to hone talents within the painter and contractor teams, orienting them towards taking responsibility for the overall project. In Himachal Pradesh, upskilling programmes were conducted for plumbers, opening the door to more opportunities. Our associations like that with St+Art Foundation resulted in many new initiatives in Chennai and Goa. We made significant strides in promoting inclusive education and health and hygiene awareness in our adjoining communities. During the year, 43,000 persons benefited through our employee volunteering programmes which carried out successful healthcare camps in rural communities. I am also pleased to report our participation in restoration of safe water structures in parts of Gujarat.

In line with our brand saliency, we attempted to connect more strongly with our customers through multiple campaigns and events. Our campaigns promoted our connect with homes, showcasing common day-to-day life moments to bring joy and happiness in customers' lives while at the same time giving a social message of staying safe and at home during the lockdown.

Responding to the Pandemic

The ongoing pandemic and consequent lockdowns are having a devastating effect on lives, occupations and wellbeing of people at large. We have taken several steps to help the community navigate through these troubled times. Contributions to Central and State Emergency Relief Funds, support to NGOs supplying essential items to the needy, protocols to ensure employee safety, addition of hand sanitizers and surface disinfectants to our product portfolio, launch of safe painting campaigns, mitigating hardships faced by retailers and contractors and helping shops restart their business safely are amongst the many initiatives implemented by the Company.

Being a responsible & caring Brand, the Company has forayed into the hand sanitizers and surface disinfectants to support the Government and its stakeholders. To deepen the connect with the consumers and all the stakeholders, the Company has launched a Safe Painting Campaign which continues to receive a very good response. The campaign has attempted to assure the consumers about the Safe Painting Services by helping them overcome their reservations following the pandemic and strengthen the bond which the Company enjoys with the consumers.

Navigating the New

As the world hesitatingly limps back to normalcy, much would change. Business in a post-pandemic world will be full of new challenges and new opportunities. The customer who emerges after months of lockdown would come with new expectations. Skills learnt and talents discovered while in prolonged isolation will not be forsaken easily. As people at large seek to make changes in the way they live, work, travel or unwind or look for new ways to pursue leisure, sports and entertainment, it will inevitably impact our business. Winners will be the organisations that guide customers through the transition with innovative ideas and solutions and bring joy to their lives. I am sure our inherent resilience and the unparalleled dedication of our employees will help us navigate through the exciting times ahead and continue to create unmatched value for all.

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

Yours sincerely,

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 Seventy-Fourth Annual Report of Asian Paints Limited along with the audited financial statements (standalone and consolidated) for the financial year ended 31^st March, 2020.

FINANCIAL RESULTS

The Company's financial performance for the year ended 31^st March, 2020 is summarized below:

* Restated figures after adjusting for retrospective application of Ind AS 116 - Leases.

**Comprise of impairment provision towards investment made in Sleek International Private Limited & Maxbhumi Developers Limited of ' 29.7 crores and ' 3.5 crores respectively.

COMPANY PERFORMANCE OVERVIEW During the financial year 2019-20:

• During the financial year 2019-20, revenue from operations on standalone basis increased to Rs. 17,194.09 crores as against Rs. 16,391.78 crores in the previous year - a growth of 4.9%.

• Even with the loss of sales in the last fortnight of March, 2020, the Company managed to end the year with a double digit volume growth of 11.2% for domestic decorative business. Against this double digit volume growth for the year, the value growth was in single digit as we continue to focus on growing the bottom of the pyramid with concentrated push on the upgradation of emulsions as well as large undercoats market.

• Cost of goods sold as a percentage to revenue from operations decreased to 55.3 % as against 57.4% in the previous year.

• Employee cost as a percentage to revenue from operations increased to 5.7% (Rs.5.43 crores) against 5.5% (Rs.900.14 crores) in the previous year.

• Other expense as a percentage to revenue from operations increased to 16.6% (Rs.2,845.44 crores) as against 15.7% (Rs.2,576.21 crores) in the previous year.

• The Company has contributed Rs. 25 Crores towards COVID-19 pandemic related relief activities.

• The Profit After Tax for the current year is Rs. 2,653.95 crores against Rs. 2,132.17 crores in the previous year - a growth of 24.5%. Higher growth was due to reduction in tax rate during the year.

• On a consolidated basis, the group achieved revenue of Rs.,211.25 crores as against Rs. 19,248.45 crores - a growth of 5.0%. Net profit after non-controlling interest for the group for the current year is Rs. 2,705.17 crores as against Rs. 2,155.92 crores in the previous year - a growth of 25.5%.

IMPACT OF COVID-19

The country witnessed lockdown being implemented in India in the second fortnight of March 2020. There were also restrictions of varying extent across larger part of the world, due to the COVID-19 pandemic. This impacted the business operations of the Company significantly. Since May 2020, the Company started resuming operations in its manufacturing plants and warehouses after taking requisite permissions from Government authorities.

By staying true to its purpose and its values, the top-most priority for the Company was to ensure the safety of its employees. The Company has taken several measures to ensure their well-being including leveraging the power of technology to enable them to work from home. For those employees who are working in sales offices and manufacturing locations, their safety is being ensured by stringent use of protective gear, abiding by social distancing norms and taking all safety precautions.

Standing by its core commitment, the Company is navigating through these unprecedented times by building stronger and deeper relationships with consumers and its partners. The Company is supporting various Government Initiatives and helping communities around to fight the pandemic.

Detailed information on the same has been included under the Management Discussion & Analysis report forming part of this Annual Report.

TRANSFER TO RESERVES

The Company has not transferred any amount to the Reserves for the year ended 31^st March, 2020.

DIVIDEND

During the year under review, the Company paid to its shareholders:

• First 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 in the month of November, 2019; and

• Second interim dividend of Rs. 7.15 (Rupee seven and paise fifteen only) (715%) per equity share of the face value of Rs. 1 (Rupee one only) each in the month of March, 2020.

The Board of Directors at their meeting held on 23^rd June, 2020 has recommended payment of Rs. 1.50 (Rupees one & paise fifty only) 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, 2020. The payout is expected to be Rs. 143.88 crores (Rupees one hundred fourty three crores and eighty eight lakhs). The payment of final dividend is subject to the approval of the shareholders of the Company at the ensuing Annual General Meeting (AGM).

If approved, the total dividend (interim and final dividend) for the financial year 2019 - 20 will be Rs. 12 (Rupees Twelve only) per equity share of the face value of Rs. 1 each (Rupee one only) [Dividend payout for the FY 2019-20 totals to Rs. 1,151.04 crores (Rupees one thousand one hundred fifty one crores and four lakhs)] as against the total dividend of Rs. 10.50 (Rupees ten and paise fifty only) per equity share of the face value of Rs. 1 each (Rupee one only) paid for the previous financial year 2018-19 [Dividend payout for the FY 2018-19 totals to Rs. 1007.16 crores (Rupees One Thousand and Seven Crores and Sixteen Lakhs)].

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 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 (hereinafter referred to as "the Act") read with Investor Education and Protection Fund (Accounting, Audit, Transfer and Refund) Rules, 2016 (hereinafter referred to as the "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 during the FY 2019-20 and corresponding shares on which dividends were unclaimed for seven (7) consecutive years, are provided in the General Shareholders Information section of Corporate Governance report forming part of this Annual Report.

CONSOLIDATED FINANCIAL STATEMENTS

In accordance with the provisions of 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 2019-20, together with the Auditors' Report form part of this Annual Report.

Financial Performance

The Management Discussion and Analysis report forming part of the Annual Report provides a detail overview of the operations of the subsidiaries of the Company.

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 (hereinafter referred to as "CFS") in compliance with Section 129 (3) and other applicable provisions, if any, of the Act read with Rules.

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 and associate companies, are available on our website, www.asianpaints.com

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

The Company does not have a material subsidiary.

During the year under review:

a. The Board of Directors of the Company at their meeing held on 22^nd 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 1^st 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 22^nd April, 2020 and 27^th April, 2020, inter alia admitted the Scheme of Amalgamation.

b. 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 Rs. 20.81 crores (Rupees twenty crores and eighty one lakhs) on 17^th September, 2019. BPS had a limited presence in the Singapore coatings market and was not material in overall Company's international operations.

c. The Company has made an assessment of the recoverable value of investment in its subsidiaries taking into account the past business performance, prevailing business conditions and revised expectations of the future performance. Accordingly, an impairment loss of approximately Rs. 29.70 crores (Rupees twenty nine crores and seventy lakhs) and Rs. 3.50 crores (Rupees three crores and fifty lakhs) have been recognised towards investment in Sleek International Private Limited and Maxbhumi Developers Limited (an asset holding Company having land held for sale), respectively.

Retirement of Mr. KBS Anand as the Managing Director & CEO of the Company

The term of Mr. KBS Anand as the Managing Director and CEO came to an end on 31^st March, 2020 and consequently he ceased to be a Director of the Company.

Mr. KBS Anand had joined the Company in the year 1979 and has held various positions in Decorative, Industrial and Chemical business functions of the Company. He was appointed as the Managing Director & CEO of the Company, w.e.f. 1^st April, 2012. During his tenure as the Managing Director & CEO, he has transformed the Company from being a Paints' major towards a complete decor solutions provider to help customers create their dream homes.

The Board of Directors place on record their deep sense of gratitude and appreciation for the invaluable contribution rendered by Mr. KBS Anand during his four decades long illustrious career with the Company in many roles and recently as the Managing Director & CEO of the Company for the past eight years.

Appointment of Mr. Amit Syngle as an Additional Director/Managing Director & CEO of the Company

The Board of Directors of the Company at their Meeting held on 28^th March, 2020, based on the recommendations of the Nomination and Remuneration Committee of the Board of Directors of the Company, approved the appointment and remuneration of Mr. Amit Syngle as an Additional Director/Managing Director & CEO (Key Managerial Person) of the Company for a period of three years effective from 1^st April, 2020 up to 31^st March, 2023, subject to the approval of the shareholders at ensuing AGM of the Company.

The Board of Directors recommend the appointment of Mr. Amit Syngle as the Managing Dirctor and CEO of the Company. Mr. Amit Syngle has spent 30 years with the Company and has headed Supply Chain, Sales & Marketing and Research & Technology funtions. In addition, he also spearheaded the newly acquired businesses of the Kitchens and Bath spaces in the Home Improvement venture of the Company.

Before being appointed as an Additional Director/ Managing Director & CEO, Mr. Amit Syngle held the position of Chief Operating Officer of the Company.

He has been appointed as the Key Managerial Personnel of the Company in accordance with Section 203 of the Act, w.e.f. 1^st April, 2020.

Appointment of Mr. Manish Choksi as NonExecutive Director 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, erstwhile Chairman. The shareholders had thereafter approved the same.

In terms of sub-section (4) of Section 161 of the Act, Mr. Manish Choksi holds office upto to the date of this AGM.

The Board of Directors of the Company, based on the recommendation of Nomination and Remuneration Committee, have recommended the appointment of Mr. Manish Choksi as a Non - Executive Director of the Company from the date of ensuing AGM, subject to approval of the shareholders, in terms of Section 152 read with Section 160 of the Act, liable to retire by rotation.

Retirement by rotation and subsequent reappointment

In accordance with the provisions of Section 152 and other applicable provisions, if any, of the Act (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. Ashwin Dani and Ms. Amrita Vakil, Non-Executive Directors, 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.

Mr. Ashwin Dani, Chairman and Non - Executive Director of the Company, having attained the prescribed age limit of 75 years, Special Resolution is proposed in accordance with Regulation 17(1A) of Listing Regulations for approval by the Shareholders of the Company.

The Shareholders had earlier approved the continuation of directorship of Mr. Ashwin Dani beyond 75 years of age by passing a Special Resolution.

In the opinion of the Nomination & Remuneration Committee and Board of Directors of the Company, considering his seniority, role played by Mr. Ashwin Dani towards the growth of this Company and to reap the benefits of his rich and varied experience, approval of shareholders is sought for continuation of Mr. Ashwin Dani as a Non-Executive Director, liable to retire by rotation.

Declaration of independence from Independent Directors

The Company has received the following 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 of Regulation 16 of the Listing Regulations.

• In terms of Rule 6(3) of the Companies (Appointment and Qualification of Directors) Rules, 2014, they have registered themselves with the Independent Director's database maintained by the Indian Institute of Corporate Affairs, Manesar.

• In terms of Regulation 25(8) of the Listing Regulations, 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.

In terms of Regulation 25(9) of the Listing Regulations, the Board of Directors has ensured the veracity of the disclosures made under Regulation 25(8) of the Listing Regulations by the Independent Directors of the Company.

CHANGE IN KEY MANAGERIAL PERSON Retirement of Mr. Jayesh Merchant as CFO & Company Secretary, President - Industrial JVs from the Company

Mr. Jayesh Merchant retired from the services of the Company, w.e.f. 26^th November, 2019.

Mr. Jayesh Merchant had joined the Company in the year 2002 as Vice President- Finance & Company Secretary. The Board of Directors designated him as the Chief Financial Officer of the Company in 2006. Since, November, 2012, he also headed the Industrial businesses of the Company operated in India, through two joint ventures companies with PPG Inc., USA.

The Board places on record its appreciation of the contribution of Mr. Jayesh Merchant during his association with the Company.

6 Company Secretary of the Company

Mr. R J Jeyamurugan was appointed as the CFO & Company Secretary of the Company, w.e.f. 27^th November, 2019.

Mr. R J Jeyamurugan is an associate member of the Institute of Chartered Accountants of India (ICAI) and the Institute of Company Secretaries of India (ICSI). He joined the Company in the year 1991. He has considerable experience in the areas of finance, accounts, secretarial and taxation matters. He has held important positions in the organization including Assistant Company Secretary during August, 1997 to May, 1999. He heads the Finance, Accounts, Shared Service Centre, Tax, Legal, Secretarial & Investor relations functions of the Company.

Before his appointment as the CFO & Company Secretary, he held the position of Vice President - Finance of the Company. He has also been the Compliance Officer of the Company since May, 2018.

NUMBER OF MEETINGS OF THE BOARD

7 (seven) meetings of the Board of Directors were held during the financial year 2019 - 20. The details of the meetings of the Board of Directors of the Company convened and attended by the Directors during the financial year 2019-20 are given in the Corporate Governance Report which forms part of this Annual Report.

NOMINATION AND REMUNERATION POLICY

The salient features of the Nomination and Remuneration Policy of the Company 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 & re-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 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 of the Listing Regulations.

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 [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 effective evaluation of the performance of Individual Directors, Committees of the Board and the Board as a whole.

The Board formally assesses its own performance based on parameters which, 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 contribution made at the Board meeting, attendance, instances of sharing best and next practices, domain knowledge, vision, strategy, engagement with senior management, 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 Independent Directors at their separate meeting review the performance of: non-independent directors and the Board as a whole, Chairperson of the Company after taking into account the views of Executive Director and non-executive directors, the quality, quantity and timeliness of flow of information between the Company management and the Board that is necessary for the Board to effectively and reasonably perform their duties.

Based on the outcome of the performance evaluation exercise, areas have been identified for the Board to engage itself with and the same would be acted upon.

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

FAMILIARIZATION PROGRAM FOR INDEPENDENT DIRECTORS

All new independent directors inducted into the Board 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 (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, 2020, the applicable Accounting Standards and Schedule III of the Act, 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, 2020 and of the profits of the Company for the financial year ended 31^st March, 2020;

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 Rs.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.

AUDITORS AND AUDITORS' REPORT 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 has 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, 2020. The Auditors' Report for the financial year ended 31^st March, 2020 on the financial statements of the Company is a 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. R A & Co., Cost Accountants, (Firm Registration No. 000242) carried out the cost audit for applicable businesses during the financial year 2019 - 20.

The Board of Directors of the Company, on the recommendations made by the Audit Committee, have 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 2020 - 21. M/s. RA & Co., being eligible, have consented to act as the Cost Auditors of the Company for the FY 2020 - 21.

The remuneration proposed to be paid to the Cost Auditor, subject to ratification by the members of the Company at the ensuing 74^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 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 2020 - 21. 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, 2021.

The Secretarial Audit Report for the financial year ended 31^st March, 2020 under Act, 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, 2020, 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.

COMMITTEES

As on 31^st March, 2020, the Board has six committees: Audit Committee, Corporate Social Responsibility Committee, Nomination and Remuneration Committee, Risk Management Committee, Stakeholders Relationship Committee and Shareholders Committee.

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 is provided in the Corporate governance report.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

During the financial year ended 31^st March, 2020, the Company incurred CSR Expenditure of Rs. 74.64 crores (Rupees seventy four crores and sixty four 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 https://www. asianDaints.com/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, 2020, 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.

The Company has committed Rs. 35 crores towards COVID-19 pandemic related relief activities, out of which Rs. 15 crores was spent as CSR in the FY 2019-20. The contribution was made to the Central as well as other Disaster Relief State funds to combat COVID-19 pandemic.

CORPORATE GOVERNANCE REPORTAND 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.

EXTRACT OF ANNUAL RETURN

The extract of the Annual Return of the Company as on 31st March, 2020 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 Rport.

RELATED PARTY TRANSACTIONS

AH contracts/arrangements/transactions entered into by the Company during the year under review with Related Parties were in 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 https://www.asianpaints.com/more/ investors/policies-programs.html .

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. During the year under review, the Related Policy Framework was suitably amended to give effect to the changes in the relevant provisions of law.

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 20% 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 for annual results to the stock exchanges. The said disclosures can be accessed on the website of the Company at https://www.asianpaints.com/more/investors.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 [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, 2020, are set out in Note 37(B) to the Standalone Financial Statements of the Company.

RISK MANAGEMENT

The Company operates in a volatile, uncertain, complex and ambiguous (VUCA) world with rapid changes. These changes bring 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 these uncertainties and after assessing them, devises short-term and long-term actions to mitigate any risk which could materially impact the Company's long-term goals.

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.

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. 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.

The Board of Directors of the Company on the recommendation of the Risk Management Committee has developed risk management policy for the Company which articulates the Company's approach to address the uncertainities in its endeavour to achieve its stated and implicit objectives.

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 Rs.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, mala-fide manipulation of Company records, discrimination to the Code of Conduct in an anonymous manner.

The Policy also provides 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 (hereinafter referred to as "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 2019-20 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

Internal financial control over financial reporting have been designed to provide reasonable assurance with regards to recording and providing reliable financial information and complying with applicable accounting standards. These controls are reviewed periodically, and the Company continuously tries to automate these controls to increase its reliability.

The Company uses an established ERP system of SAP S/4 HANA to record day to day transactions for accounting and financial reporting. The ERP system is configured to ensure all transactions are integrated seamlessly with the underlying books of account.

During the year, the Company upgraded its core Navision based ERP system to the latest SAP S/4 HANA version for its International business units except subsidiaries in South

Pacific. All key internal controls over financial reporting were thoroughly tested along with the core functionalities before migrating to the new system.

The Shared Services Center (SSC) further increased the coverage of digital invoice processing during the year. This has made the process touchless and seamless. Necessary validations built in ensures compliance to statutes and internal policies are adhered to.

The Company has invested in an RPA (Robotic Process Automation) to help in doing the GST reconciliation with the data uploaded by the vendors. This has brought about significant efficiencies and enabled the Company to follow up with the vendors in a timely manner so that GST credits taken are not lost.

The Company has a well-defined and documented delegation of authority with specified limits for approval of expenditure, both capital and revenue. The Company has workflows to ensure adherence to the delegation of authority.

The Company has a commercial manual which lays down certain principles and procedures that are to be followed in commercial & purchase contracts transactions across the Company. The SSC verifies the compliance to commercial manual before clearing the payments.

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 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 account.

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. There are no material changes and commitments affecting the financial position of the Company which have occurred between the end of the financial year 2019-20 and the date of this report;

b. During the year under the review, there was no change in the nature of business of the Company.

In the beginning of financial year 2020-21, the Company has expanded its health and hygiene segment by the launch of Viroprotek range of hand sanitisers and Surface disinfectants. This was with a view to address the growing requirement of hand and surface sanitizers for increased protection and assist the Government in fighting against the COVID-19 pandemic;

c. 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;

d. 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;

e. 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;

f. The Competition Commission of India has passed a prima facie Order dated 14^th January, 2020, directing the Director General 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;

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 [G] to this report;

j. 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;

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; and

m. There was no revision of financial statements and Boards report of the Company during the year under review.

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.

Asian Paints Ltd Company Background

Asian Paints Ltd Company Management

Asian Paints Ltd Listing Information

Asian Paints Ltd Finished Product