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Mahindra and Mahindra Directors Report, M&M Reports by Directors
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Mahindra and Mahindra
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Download Annual Report PDF Format 2015 | 2014 | 2013 | 2012 | 2011
Directors Report Year End : Mar '15    « Mar 14
 Dear Members
 
 The Directors present their Report together with the audited financial
 statements of your Company for the year ended 31st March, 2015.
 
 A.  FINANCIAL AND OPERATIONAL HIGHLIGHTS
 
                                                         (Rs. in crores)
 
                                                 2015            2014
 
 Gross Income                                   41,982         43,838
 
 Less: Excise Duty on Sales                      2,188          2,612
 
 Net Income                                     39,794         41,226
 
 Profit before Depreciation, Finance
 
 Costs, Exceptional items and Taxation           5,022          5,439
 
 Less: Depreciation/Amortisation                   975            863
 
 Profit before Finance Costs,
 
 Exceptional items and Taxation                  4,047          4,576
 
 Less: Finance Costs                               214            259
 
 Profit before Exceptional items
 
 and Taxation                                    3,833          4,317
 
 Add: Exceptional items                            336             52
 
 Profit before Taxation                          4,169          4,369
 
 Less: Provision for Tax - Current Tax
 
 (including MAT credit entitlement)                743            350
 
 Less: Provision for Tax - Deferred
 
 Tax (Net)                                         105            261
 
 Profit for the year                             3,321          3,758
 
 Balance of profit for earlier years            12,325          9,952
 
 Less: Transfer to Debenture
 
 Redemption Reserve                                 17             17
 
 Profits available for appropriation            15,629         13,693
 
 Add: Reversal of income tax on
 
 dividend paid for 2013-14                           3            —
 
 Less: Transfer to General Reserve                   -            400
 
 Proposed Dividends                                745            862
 
 Income-tax on Proposed Dividend                   102            104
 
 Depreciation as per transitional 
 provision specified in Schedule II of
 the Companies Act, 2013 -
 [Net of Tax of Rs. 18.24 crores]                   35             —
 
 Dividend for 2012-13 paid on
 
 shares issued in June, 2013                         —             2
 
 Income-tax on Dividend Paid                         —             *
 
 Balance carried forward                        14,750         12,325
 
 * denotes amounts less than Rs. 50 lakhs
 
 Stabilisation and recovery are the two words that best characterise
 India''s economic performance in the Financial Year 2014-15. Supported
 by benign prices across the commodity complex - food, metals and crude
 oil, the country''s macros witnessed a sharp and reassuring
 consolidation. The centre''s fiscal deficit dropped to 4.1% from 4.4% a
 year ago and is set to consolidate further in the current Financial
 Year. The country''s balance of payments registered a healthy surplus,
 while the current account deficit came in below 2% of GDP for the
 second year in succession. Furthermore, consumer price inflation is
 currently trending around the 5% mark, a sharp drop from the entrenched
 double digit price acceleration experienced during the last couple of
 years and considerably below the 8% target that the RBI had set for
 itself a year ago. The latter''s monetary stance has, consequently,
 eased considerably and may ease further in the coming months.
 
 Economic activity, at the same time, witnessed a steady, albeit slow,
 recovery through the year. While the regulatory and procedural reforms
 undertaken by the new Government since taking office in June last year
 did help improve the business climate prevailing in the country, weak
 demand continued to constrain private sector activity for the second
 year in succession. With global growth across developed and emerging
 markets remaining below par in 2014, external demand remained tepid and
 uninspiring through the year. At the same time, a poor monsoon season
 coupled with benign food prices severely constrained rural incomes and
 domestic demand. The one bright spot was the turnaround in investment
 plans and expenditures signalled by the sharp pick up in capital goods
 production and new project announcements in the second half of 2014-15,
 which portends well for future growth.
 
 However, even amidst this scenario, your Company demonstrated
 resilience to economic cycles with a decline of only 3.47% in net
 income at Rs. 39,794 crores in the year under review as against Rs.
 41,226 crores in the previous year.
 
 The Profit for the year before Depreciation, Finance Costs, Exceptional
 items and Taxation recorded a decrease of 7.67% at Rs. 5,022 crores as
 against Rs. 5,439 crores in the previous year. Similarly, Profit after
 tax declined by 11.62% at Rs. 3,321 crores as against Rs. 3,758 crores
 in the previous year.
 
 Your Company continues with its rigorous cost restructuring exercises
 and efficiency improvements which have resulted in significant savings
 through continued focus on cost controls and process efficiencies.
 
 No material changes and commitments have occurred after the closure of
 the Financial Year 2014-15 till the date of this Report, which would
 affect the financial position of your Company.
 
 Performance Review 
 
 Automotive Division:
 
 Your Company''s Automotive Division recorded total sales of 3,96,534
 vehicles and 59,404 three-wheelers as compared to 4,34,505 vehicles and
 64,510 three-wheelers in the previous year registering a decline of
 8.7% in vehicle sales and a decline of 7.9% in three-wheeler sales.
 
 On the domestic sales front, your Company sold 2,23,968 Passenger
 Vehicles [including 2,06,837 Utility Vehicles (UVs), 13,947 Multi
 Purpose Vehicles (MPVs) and 3,184 Cars] which is a decline of 11.9%
 over the previous year''s volumes of 2,54,344 Passenger Vehicles
 [including 2,19,421 UVs, 25,189 MPVs and 9,734 Cars]. In the commercial
 vehicle segment, your Company sold 1,45,010 vehicles [including 15,255
 vehicles < 2T GVW and 1,29,755 vehicles between 2-3.5T GVW] registering
 a decline of 4.8% over the previous year''s volume of 1,52,398
 commercial vehicles, [including 29,223 vehicles < 2T GVW and 1,23,175
 vehicles between 2-3.5T GVW]. In the three-wheeler segment, your
 Company sold 56,764 three-wheelers registering a decline of 9.3% over
 the previous year''s volume of 62,614 three-wheelers.
 
 For the year under review, the Passenger Vehicle (PV) industry has
 shown signs of revival, but this has been patchy. The Car industry
 growth is largely driven by new launches. Your Company''s volume decline
 in the UV segment is a reflection of the UV market shift towards
 compact UVs attracting lower excise rates. The < 2T Light Commercial
 Vehicle (LCV) industry continues to shrink and the 2 to 3.5T LCV
 industry (Pik- Ups) suffered due to slowdown in Agri incomes and
 finance availability.
 
 Your Company''s UV sales volume declined by 5.7%, but your Company
 continued to maintain its leadership position in the domestic UV market
 by posting a market share of 37.4%.  During this year, Bolero sales
 once again crossed the milestone of 1 lakh sales in a year. This is the
 fourth consecutive year that Bolero has achieved this milestone. Also,
 Bolero retained the title of India''s largest selling Sports Utility
 Vehicle (SUV) for the 9th consecutive year. It is also the 5th highest
 selling passenger vehicle in India. In September, 2014, the Company 
 launched the New Generation Scorpio. The New Generation Scorpio is 
 built on an all new platform and comes with contemporary styling and 
 advanced technology features. New Generation Scorpio is all set to take
 the Scorpio brand to new heights.  The Scorpio posted record sales 
 since launch and strengthened its iconic status with sales of over 
 50,000 units for the fourth successive year. The XUV500 continued to be
 the customer''s choice in the premium UV segment with sales of over 
 34,000 units in the year.
 
 In the Pik-Up segment of commercial vehicles (LCV 2 to 3.5T), your
 Company strengthened its leadership position with a market share of
 73.3% (a gain of 9.5% points).
 
 Your Company recorded total sales of 8,912 commercial vehicles
 [including 5,413 LCVs in the LCV > 3.5T segment and 3,499 HCVs (Heavy
 Commercial Vehicles)] which is a growth of 9.2% over the previous
 year''s volumes of 8,161 commercial vehicles [including 5,876 LCVs in
 the LCV > 3.5T segment and 2,285 HCVs].
 
 In the Overseas market, your Company''s volume grew 1.8% over the
 previous year. While the markets of Sri Lanka, Nepal, Bangladesh and
 Bhutan witnessed good growth, there was a decline in Chile and South
 Africa. During the year under review, your Company sold 27,556 vehicles
 and 2,640 three-wheelers in the overseas market as compared to 27,763
 vehicles [including 452 vehicles sourced from the erstwhile Trucks and
 Bus Division of Mahindra Trucks and Buses Limited which subsequently
 got demerged into the Company] and 1,896 three-wheelers in the previous
 year.
 
 Spare parts sales for the year stood at Rs. 1,609.90 crores (including
 exports of Rs. 104.04 crores) as compared to Rs. 1,427.81 crores
 (including exports of Rs. 92.98 crores) in the previous year,
 registering a growth of 12.8%.
 
 Farm Division:
 
 In the Financial Year 2014-15, the Indian tractor industry witnessed a
 steep decline of 13.1%. This was on account of poor monsoon followed by
 unseasonal rains. The domestic market recorded sales of 5,50,963
 tractors as compared to 6,33,656 tractors in the previous year.
 
 In the face of this challenging industry situation, your Company''s Farm
 Division (including Swaraj Division) recorded sales of 2,34,766
 tractors as against 2,68,487 tractors sold in the previous year,
 registering a decline of 12.6%.
 
 Your Company''s sales in the domestic market stood at 2,21,020 tractors
 as compared to 2,58,339 tractors in the previous year, registering a
 decline of 14.4%. However, your Company continues to be the market
 leader with a 40% market share.  With a vision to offer class leading
 tractors to the Indian farmer, your Company launched the
 technologically advanced and stylishly designed Arjun Novo. Arjun Novo
 is the first tractor model to roll out of the all new high Horse Power
 (HP) platform, creating new benchmarks in performance, technology,
 comfort and ergonomics. Arjun Novo boasts of a wide array of
 world-class and category first features.
 
 For the year under review, your Company exported 13,746 tractors
 registering a growth of 35.5% over the previous year.  This is the
 highest ever tractor exports by the Company.
 
 Beyond tractors, your Company has presence in crop care solutions and
 distribution of seeds. The focus of this business is to provide quality
 inputs and help improve farm productivity.  In the Financial Year
 2014-15, this business saw a good growth of 49.6% in terms of revenue.
 
 In the power generation space, under the Mahindra Powerol Brand, your
 Company continues to be amongst the leaders in the industry. Your
 Company earned a revenue of Rs. 834.5 crores in the current Financial
 Year as against Rs. 775.5 crores in the previous year, registering a
 growth of 7.6%. Along with the revenue growth, your Company has
 improved its presence in the retail segment and made good progress in
 the ''Energy Management Solutions'' space.
 
 Spare parts sales for the year stood at Rs. 549.43 crores (including
 exports of Rs. 48.84 crores) as compared to Rs. 521.71 crores
 (including exports of Rs. 39.91 crores) in the previous year,
 registering a growth of 5.3%.
 
 Current Year''s review
 
 During the period 1st April, 2015 to 28th May, 2015, 58,905 vehicles
 were despatched as against 59,243 vehicles during the corresponding
 period of the previous year. During the same period, 37,519 tractors
 were despatched as against 43,826 tractors despatched during the
 corresponding period in the previous year.
 
 Looking ahead, your Company expects that the economic recovery,
 currently underway, will gather further strength through 2015-16, led
 by a pick up in mining and infrastructural activity. The global
 economy, while rife with risks, is forecast to grow at a faster pace in
 2015-16. Exports, consequently, are expected to pick up pace in this
 Financial Year. While rural incomes are difficult to forecast, the El 
 Nino warning currently in place, suggests that rural demand may remain 
 below par this year as well. However, multiplier effects flowing from 
 Government and, to a smaller extent, private sector initiatives in the 
 infrastructure space - roads, mining, power, railways, urbanisation and
 smart cities - including projects already under implementation, will 
 help sustain demand through the year.
 
 Finance
 
 The Financial Year 2014-15 witnessed divergent economic performance and
 monetary policies around the world. The United States economy saw
 continued improvement with job creation, the US Fed ended its
 quantitative easing (QE) program in October, 2014 and is the only
 economy among G-20 countries expected to go into an interest rate hike
 cycle.  On the other hand, stagnant economic activity and falling
 commodity prices (especially crude) prompted central banks in Europe
 and Japan to embark on QE programs. Emerging markets witnessed a fall
 in growth rates, led by a slowdown in China, a steep contraction in
 Russia and a recession in Brazil.  A large number of central banks have
 cut rates in the fourth quarter of the Financial Year 2014-15 as they
 fight the threat of deflation with the collapse in crude and other
 commodity prices. The latest World Economic Outlook by IMF projects the
 global growth to remain moderate in 2015. The outlook for advanced
 economies is improving, while growth in emerging markets and developing
 economies is projected to be lower, primarily reflecting weaker
 prospects for some large emerging market economies and oil-exporting
 countries. Financial Year 2014-15 witnessed unprecedented strength in
 the US Dollar against most currencies. Countries over-reliant on
 commodity exports saw their currencies coming under pressure. Indian
 Rupee remained in a relatively narrow band as the new Government''s
 commitment towards fiscal prudence and progressive economic policies,
 led to surge of foreign flows into the country (both FDI and FII). The
 Reserve Bank of India (RBI) steadily intervened in the forex market to
 augment its forex reserves.
 
 On the interest rate front, RBI, stayed on its path of inflation
 targeting. With the CPI inflation target of 8% by March, 2015
 comfortably achieved (Inflation for March, 2015 at 5.25%) and the
 future outlook for coming quarters being benign, RBI reduced repo rate
 by cumulative of 50 bps in the last quarter of the Financial Year
 2014-15. RBI, in addition, effectively managed the systemic liquidity
 conditions by way of its liquidity management framework comprising
 fixed and variable rate repo and reverse repo, term repo and marginal
 standing facility. Going forward, while RBI is expected to broadly
 maintain an accommodative policy stance, future policy actions will be
 dependent on evolving data points.
 
 Your Company continued to focus on managing cash efficiently and
 ensured that it had adequate liquidity and back up lines of credit.
 During the course of the year, your Company repaid Rs. 489 crores of
 borrowings from internal accruals. The Company''s Bankers continue to
 rate your Company as a prime customer and extend facilities/services at
 prime rates. Your Company follows a prudent financial policy and aims
 not to exceed an optimum financial gearing at any time. The Company''s
 total Debt to Equity Ratio was 0.19 as at 31st March, 2015.
 
 Even in this challenging environment, in recognition of its prudent
 financial policies, your Company for the first time now enjoys the
 highest level of rating from all major rating agencies at the same
 time.
 
 Your Company has been rated by CRISIL Limited (CRISIL), ICRA Limited
 (ICRA) and Credit Analysis & Research Limited (CARE) for its banking
 facilities under Basel II norms. All have re-affirmed the highest
 credit rating for your Company''s Short Term facilities.  During the
 year, CRISIL and ICRA have upgraded their ratings on your Company''s
 long-term bank facilities and Non-Convertible Debenture (NCD) programme
 to ''CRISIL AAA/Stable'' and ''[ICRA] AAA (stable)'' respectively. Further,
 CARE has also revised the ratings of the Company''s long-term bank
 facilities upwards to ''CARE AAA''. India Ratings and Research (Ind-Ra, a
 Fitch Group Company) has assigned Long-Term Issuer Rating of ''IND AAA''
 with a Stable outlook to your Company since last year.
 
 The AAA ratings indicate highest degree of safety regarding timely
 servicing of financial obligations and is also a vote of confidence
 reposed in your Company''s Management by the rating agencies. It is an
 acknowledgement of the strong credit profile of your Company over the
 years, resilience in earnings despite cyclical upturns/downturns,
 robust financial flexibility arising from the significant market value
 of its holdings and prudent management.
 
 During the year, your Company earned recognition for Best Financing
 Solution from Treasury Today Asia for its issuance of 50 year
 Non-Convertible Debentures, which was the first of its kind in the
 Indian financial markets.
 
 Investor Relations (IR)
 
 In the continuous search for excellence, your Company continued to
 engage with investors in many ways, including one on one meetings,
 telepresence meetings, participation in investor conferences, 
 quarterly earnings calls and annual analyst meet. Your Company 
 interacted with around 650 Indian and overseas investors and 
 analysts (excluding quarterly earnings calls and specific
 event related calls) during the year.  Your Company continuously
 strives to improve IR engagement with International and Indian
 investors and has set up feedback mechanism to measure IR
 effectiveness. Structured con-calls and periodic investor/analyst
 interactions with the Chairman & Managing Director, Executive Director
 and Business Heads were organised during the year. Your Company always
 believes in leading from the front with emerging best practices in IR
 and building a relationship of mutual understanding with
 investor/analysts. As a key milestone in this continuing endeavour,
 your Company organised its first ever con-call on Environment, Social
 and Corporate Governance (ESG) call for analysts and investors. The
 Company ensures that critical information about the Company is
 available to all the investors by uploading all such information at the
 Company''s website. Your Company has created a ''Group Investor Relations
 Council'' to share best practices across all the listed group companies
 and learn from each other.
 
 Dividend
 
 Your Directors are pleased to recommend a dividend of Rs. 12 per
 Ordinary (Equity) Share of the face value of Rs. 5 each, payable to
 those Shareholders whose names appear in the Register of Members as on
 the Book Closure Date. The equity dividend outgo for the Financial Year
 2014-15, inclusive of tax on distributed profits (after reducing the
 tax on distributed profits of Rs. 50.15 crores on the dividends
 receivable from the subsidiaries during the current Financial Year)
 would absorb a sum of Rs. 846.89 crores [as against Rs. 963.01 crores
 comprising the dividend of Rs. 13.50 per Ordinary (Equity) Share and
 also a Special Dividend of Re. 0.50 per Ordinary (Equity) Share
 aggregating Rs. 14 per Ordinary (Equity) Share of the face value of Rs.
 5 each and tax thereon paid for the previous year].
 
 B. CONSOLIDATED FINANCIAL STATEMENTS
 
 The Consolidated Financial Statements of the Company and its
 subsidiaries, prepared in accordance with the Companies Act, 2013 and
 applicable Accounting Standards form part of this Annual Report.
 
 The Consolidated Financial Statements presented by the Company include
 the financial results of its subsidiary companies, associates and joint
 ventures.
 
 Subsidiary, Joint Venture and Associate Companies
 
 The Group Companies continue to contribute to the overall growth in
 revenues of the Company.
 
 Tech Mahindra Limited (TML), the Company''s Flagship Company in the IT
 Sector, has reported a consolidated revenue of Rs. 22,621 crores in the
 current year as compared to Rs. 18,831 crores in the previous year - an
 increase of 20.1%. Its consolidated Profit After Tax is Rs. 2,628
 crores as compared to Rs. 3,029 crores in the previous year.
 
 The Group''s finance company Mahindra & Mahindra Financial Services
 Limited (Mahindra Finance), reported a total consolidated income of Rs.
 6,061 crores during the current year as compared to Rs. 5,301 crores in
 the previous year registering a growth of 14.3%. The consolidated
 Profit After Tax for the year is Rs. 913 crores as compared to Rs. 954
 crores in the previous year.
 
 Mahindra Lifespace Developers Limited (MLDL), your Company''s subsidiary
 in the business of real estate and infrastructure registered a
 consolidated operating income of Rs. 1,086 crores as compared to Rs.
 705 crores in the previous year registering a growth of 54.0%. The
 consolidated Profit After Tax for the year is Rs. 266 crores as
 compared to Rs. 101 crores in the previous year.
 
 Ssyangyong Motor Company (SYMC), the Korean subsidiary of the Company
 has reported consolidated revenues of Rs. 18,316 crores in the current
 fiscal year as compared to Rs. 20,303 crores in the previous year. The
 consolidated loss for the year is Rs. 721 crores as compared to a
 profit of Rs. 88 crores in the previous year. SYMC is working on
 improving its profitability, which will strengthen its financial
 condition.
 
 The consolidated Group Profit for the year after exceptional items, tax
 and after deducting minority interests is Rs. 3,137 crores as against
 Rs. 4,667 crores earned in the previous year.
 
 During the year under review, Competent Hotels Private Limited,
 Mahindra Racing UK Limited, Mahindra UNIVEG Private Limited, MHR
 Holdings (Mauritius) Limited,
 Covington S.a.r.l., Lords Freight (India) Private Limited, Mriyalguda
 Farm Solution Limited, Mahindra Two Wheelers Europe Holdings S.a.r.l.,
 Mahindra Industrial Park Chennai Limited, Peugeot Motocycles S.A.S.,
 Peugeot Motocycles Italia S.p.A and Peugeot Motocycles Deutschland GmbH
 became subsidiaries of your Company.
 
 During the year under review, Jiangxi Mahindra Yueda Tractor Company
 Limited, Mahindra Holidays and Resorts USA Inc., Mahindra Conveyor
 Systems Private Limited, Bell Tower Resorts Private Limited, Mahindra
 Gears Cyprus Limited, Mahindra Engineering Services Limited, Mahindra
 Engineering Services (Europe) Limited, Mahindra Engineering GmbH
 , Mahindra Technologies Services Inc., Mahindra Ugine Steel Company
 Limited, Mahindra Gears International Limited, Mahindra Gears
 Global Limited, Metalcastello S.P.A., Crest Geartech Private Limited,
 Mahindra Gears & Transmissions Private Limited, Mahindra Investments
 (India) Private Limited, Gateway Housing Finance Corporation Limited
 and Mahindra Construction Company Limited ceased to be subsidiaries
 of your Company.
 
 During the year under review, Mahindra Construction Company Limited
 became an associate of your Company and Mriyalguda Farm Solutions
 Limited ceased to be an associate of your Company.
 
 Subsequent to the year end, Divine Solren Private Limited has become a
 subsidiary of your Company and Mahindra Business & Consulting Services
 Private Limited (MBCSPL) ceased to be a subsidiary of your Company
 pursuant to the Scheme of Amalgamation of MBCSPL with Mahindra &
 Mahindra Financial Services Limited, the appointed date of which was
 1st April, 2014.
 
 During the year, Mahindra United Football Club Private Limited has
 changed its name to Mahindra Internet Commerce Private Limited,
 Mahindra Housing Private Limited has changed its name to Industrial
 Cluster Private Limited, Defence Land Systems India Private Limited has
 changed its name to Defence Land Systems India Limited, Mahindra
 Investments (International) Private Limited has changed its name to
 Mahindra HZPC Private Limited.
 
 Subsequent to the year end, Mriyalguda Farm Solution Limited has
 changed its name to Mahindra eMarket Limited and Mahindra EPC Services
 Private Limited has changed its name to Mahindra Susten Private
 Limited.
 
 A Report on the performance and financial position of each of the
 subsidiaries, associates and joint venture companies included in the
 Consolidated Financial Statement is provided in Form AOC-1 and forms
 part of this Annual Report.
 
 The Policy for determining material subsidiaries as approved by the
 Board is uploaded on the Company''s website and can be accessed at the
 Web link http://www.mahindra.com/Investors/
 Mahindra-and-Mahindra/Governance
 
 C. JOINT VENTURES, ACQUISITIONS AND OTHER MATTERS
 
 Formation of Joint Venture with Holland based company HZPC for seed
 potatoes
 
 Your Company, through its Agri Business vertical has entered into a
 Joint Venture with Holland based HZPC in April, 2014 to offer 
 the best quality seed potatoes to farmers within and outside
 India. Your Company holds 60% in this JV Company which is formed and
 made operational in the name and style of Mahindra HZPC Private
 Limited. The balance 40% is held by HZPC. HZPC is one of the leading
 innovative companies in the world in potato breeding and seed potato
 growing. The Joint Venture will benefit from the expertise of both
 companies where HZPC with their strong R&D focus will bring in access
 to latest technology, new varieties and open up global markets for the
 Indian farmers, while your Company will contribute through its strong
 farmer connect, wide spread domestic distribution and agronomy
 expertise. The new company is in the process of constructing a state of
 the art facility to produce high quality tissue culture plants,
 mini-tubers and early generation seed potatoes.
 
 Mahindra Shubhlabh Services Limited (MSSL) enters into Joint Venture
 with Belgium based Fresh Produce Company
 
 Mahindra Shubhlabh Services Limited (MSSL), an unlisted subsidiary of
 your Company entered into a Joint Venture with UNIVEG, a Belgium based
 Fresh Produce Company in April, 2014.  Your Company holds 60% in this
 JV Company which is formed and made operational in the name and style
 of Mahindra UNIVEG Private Limited The balance 40% is held by UNIVEG.
 The Joint Venture will focus on developing fresh fruit supply chain to
 provide high quality fruits that meets the needs of both the domestic
 and international markets. UNIVEG will provide technical know-how and
 best practices in quality control, post-harvest handling of fresh
 produce, ripening process and farm agronomy practices and procedures to
 meet international quality standards.
 
 Mahindra Two Wheelers and Peugeot Motocycles strategic partnership
 
 Mahindra Two Wheelers Limited, an unlisted subsidiary of your Company
 (MTWL), as part of its strategic initiative, has acquired in January,
 2015 a 51% stake in Peugeot Motocycles (Peugeot Scooters), part of the
 Euro 54 billion PSA (Peugeot) Group based in France. Peugeot Scooters
 is a key urban mobility player in Europe for over one century and is
 the oldest motorised two-wheeler manufacturer in the world.  It offers
 one of the most comprehensive range of scooters and mopeds, from 50cc
 to 400cc, including the successful three-wheeled scooter - Metropolis,
 in the European market.  The partnership would enable both MTWL and
 Peugeot Scooters to speed up their international expansion by driving
 synergies and leveraging respective strengths.
 
 Strategic Partnership with Mitsubishi Heavy Industries through
 acquisition of 33% stake in Mitsubishi Agricultural Machinery
 
 In line with the vision of the Farm Equipment Sector (FES) to become a
 global full line player in the agriculture machinery space and to
 deliver Farm Tech Prosperity, your Company signed a definitive
 agreement on 21st May, 2015, for acquiring a 33% voting stake in
 Mitsubishi Agricultural Machinery Co.  Ltd. (MAM) through fresh issue
 of common shares and Class A (non-voting) shares of MAM.
 
 The transaction is expected to close by October, 2015. The new funding
 will be used for investment in new product development and to increase
 MAM''s capital base. Mitsubishi Agricultural Machinery is a full range
 agri-machinery company producing and selling tractors, combine
 harvesters, rice transplanters and other agri-machinery. It had
 revenues of approximately JPY 50 billion (USD 408 million) in 2014-15.
 This partnership will enhance the product development capability of
 FES, strengthen your Company''s position in the North American market
 and help your Company to gain entry to new markets.
 
 Mahindra First Choice Wheels Limited (MFCWL) raises  million from
 San Francisco Based Valiant Capital
 
 Valiant Capital Management, L.P., a San Francisco based investment
 advisory firm, has invested USD 15 million (Rs. 94 crores) in Mahindra
 First Choice Wheels Limited, an unlisted subsidiary of your Company
 (MFCWL), which is also India''s No. 1 multi-brand used vehicle company.
 This is the second round of external private equity raised by MFCWL,
 with the first one in 2008 from Delhi based Phi Capital, which
 continues to be an investor in MFCWL.
 
 The capital raised by MFCWL will be used to fund its growth plans over
 the next few years, to accelerate both the expansion of its physical
 network as well as adoption of its technology-enabled products and
 services used by industry stakeholders. In addition, it plans to use
 the funds to broaden its reach for its products and services across
 other used-vehicle categories.
 
 Your Company, as part of the secondary offer, has divested 1.5% of its
 stake in favour of Valiant. At the conclusion of the transaction, your
 Company holds 43.7% as at 31st March, 2015. However, your Company has a
 right to appoint majority of Directors and by virtue of section
 2(87)(i) of the Companies Act, 2013, MFCWL continues to be a subsidiary
 of your Company.
 
 Mahindra Engineering Services Limited (MESL) completes merger with Tech
 Mahindra Limited (Tech M)
 
 A merger scheme of Mahindra Engineering Services Limited, an unlisted
 subsidiary of your Company (MESL) was announced on 29th November, 2013
 and was reported last year. Further to this, the Hon''ble High Court of
 Judicature at Bombay on 31st October, 2014 sanctioned the Scheme of
 Amalgamation and Arrangement of MESL with Tech Mahindra Limited (Tech
 M) and their respective Shareholders. The merger is effective from 8th
 December, 2014. The Appointed Date of the Scheme is 1st April, 2013.
 
 Mahindra CIE Merger
 
 On 31st October, 2014, Mahindra CIE Automotive Limited (formerly known
 as Mahindra Forgings Limited) received the approval from the Hon''ble
 High Court of Judicature at Bombay for the Merger Schemes namely (a)
 the Scheme of Amalgamation of Mahindra Hinoday Industries Limited
 (MHIL), Mahindra Ugine Steel Company Limited (MUSCO), Mahindra Gears
 International Limited (MGIL), Mahindra Investments (India) Private
 Limited (MIIPL) and Participaciones Internacionales Autometal Tres,
 S.L. (PIA 3) with Mahindra CIE Automotive Limited (MCIE) (the
 Integrated Scheme) and (b) the Scheme of Amalgamation of Mahindra
 Composites Limited (MCL) with MCIE (Composites Scheme). The Appointed
 Date for the Merger Schemes was 1st October, 2013 and Effective Date of
 the Merger Schemes was 10th December, 2014.
 
 D. INTERNAL FINANCIAL CONTROLS
 
 Your Company has in place, adequate internal financial controls with
 reference to financial statements, commensurate with the size, scale
 and complexity of its operations. During the year, such controls were
 tested and no reportable material weaknesses in the design or operation
 were observed.
 
 E. MANAGEMENT DISCUSSION AND ANALYSIS REPORT
 
 A detailed analysis of your Company''s performance is discussed in the
 Management Discussion and Analysis Report, which forms part of this
 Annual Report.
 
 F. CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
 
 All Related Party Transactions entered during the year were in the
 Ordinary Course of Business and on Arm''s Length basis. No Material
 Related Party Transactions, i.e. transactions exceeding ten percent of
 the annual consolidated turnover as per the last audited financial 
 statements, were entered during the year by your Company. Accordingly, 
 the disclosure of Related Party Transactions to be provided under 
 section 134(3)(h) of the Companies Act, 2013, in Form AOC - 2 is not 
 applicable.
 
 The policy on Related Party Transactions as approved by the Board is
 uploaded on the Company''s website and can be accessed at the Web link:
 http://www.mahindra.com/Investors/ Mahindra-and-Mahindra/Governance
 
 G. AUDITORS
 
 Statutory Auditors and Auditors'' Report
 
 Messrs. Deloitte Haskins & Sells, Chartered Accountants (ICAI
 Registration No. 117364W) were re-appointed as the Statutory Auditors
 of the Company to hold office from the conclusion of the 68th Annual
 General Meeting (AGM) held on 8th August, 2014 until the conclusion of
 the third consecutive AGM of the Company to be held in the year 2017
 (subject to ratification of their appointment by the Members at every
 AGM held after the AGM held on 8th August, 2014).
 
 As required under the provisions of section 139(1) of the Companies
 Act, 2013, the Company has received a written consent from Messrs.
 Deloitte Haskins & Sells, Chartered Accountants to their appointment
 and a Certificate, to the effect that their appointment, if made, would
 be in accordance with the Companies Act, 2013 and the Rules framed
 thereunder and that they satisfy the criteria provided in section 141
 of the Companies Act, 2013.
 
 The Members are requested to ratify the appointment of the Statutory
 Auditors as aforesaid and fix their remuneration.
 
 The Auditors'' Report does not contain any qualification, reservation or
 adverse remark.
 
 Secretarial Auditor
 
 Pursuant to the provisions of section 204 of the Companies Act, 2013
 and the Companies (Appointment and Remuneration of Managerial
 Personnel) Rules, 2014, the Company has appointed Mr. Sachin Bhagwat,
 Practicing Company Secretary (Certificate of Practice Number: 6029) to
 undertake the Secretarial Audit of the Company.
 
 In terms of provisions of sub-section 1 of section 204 of the Companies
 Act, 2013, the Company has annexed to this Board Report as Annexure I,
 a Secretarial Audit Report given by the Secretarial Auditor.
 
 The Secretarial Audit Report does not contain any qualification,
 reservation or adverse remark.
 
 Cost Auditors
 
 The Board had appointed Messrs. N. I. Mehta & Co., Cost Accountants
 (Firm Registration Number 000023), as Cost Auditor for conducting the
 audit of cost records of the Company for the Financial Year 2014-15.
 
 However, as per the Companies (Cost Records and Audit) Rules, 2014 (the
 Rules) issued by Ministry of Corporate Affairs vide Notification dated
 30th June, 2014, the requirement for Cost Audit was not applicable to
 the Company for the Financial Year 2014-15. Accordingly, Cost Audit was
 not conducted for the Financial Year 2014-15.
 
 Further, Ministry of Corporate Affairs vide its Notification dated 31st
 December, 2014 amended the Rules, pursuant to which certain products of
 the Company now require maintenance of Cost Audit records and conduct
 of Cost Audit with effect from 1st April, 2015.
 
 Accordingly, the Board of Directors on the recommendation of the Audit
 Committee, appointed Messrs. N. I. Mehta & Co., Cost Accountants, as
 the Cost Auditors of the Company for the Financial Year 2015-16 under
 section 148 of the Companies Act, 2013. Messrs. N. I. Mehta & Co. have
 confirmed that their appointment is within the limits of section
 141(3)(g) of the Companies Act, 2013 and have also certified that they
 are free from any disqualifications specified under section 141(3) and
 proviso to section 148(3) read with section 141(4) of the Companies
 Act, 2013.
 
 The Audit Committee has also received a Certificate from the Cost
 Auditors certifying their independence and arm''s length relationship
 with the Company.
 
 As per the provisions of the Companies Act, 2013, the remuneration
 payable to the Cost Auditor is required to be placed before the Members
 in a General Meeting for their ratification. Accordingly, a Resolution
 seeking Member''s ratification for the remuneration payable to Messrs.
 N. I.  Mehta & Co., Cost Auditors is included in the Notice convening
 the Annual General Meeting.
 
 H. PARTICULARS OF LOANS, GUARANTEES, INVESTMENTS AND SECURITIES
 
 Particulars of the loans given, investment made or guarantee given or
 security provided and the purpose for which the loan or guarantee or
 security is proposed to be utilised by the recipient of the loan or
 guarantee or security are provided in Note Nos. 43, 13A and 13B to the
 Standalone Financial Statements.
 
 I. PUBLIC DEPOSITS AND LOANS/ADVANCES
 
 Your Company has discontinued its Fixed Deposits Scheme for 36 months
 with effect from the close of office hours on 31st January, 2014 and
 has also discontinued acceptance of Fixed Deposits with effect from 1st
 April, 2014.
 
 Out of the previously accepted total of 6,610 deposits of Rs. 5,910.80
 lakhs from the public and shareholders as at 31st March, 2015, 162
 deposits amounting to Rs. 79.43 lakhs, had matured and had not been
 claimed as at the end of the Financial Year. Since then, 50 of these
 deposits of the value of Rs. 33.12 lakhs have been claimed and 1 of
 these deposits of the value of Rs. 0.10 lakhs has been transferred to
 the Investor Protection Fund.
 
 There was no default in repayment of deposits or payment of interest
 thereon during the year under review. There are no deposits which are
 not in compliance with the requirements of Chapter V of the Companies
 Act, 2013.
 
 The particulars of loans/advances and investment in its own shares by
 listed companies, their subsidiaries, associates, etc., required to be
 disclosed in the Annual Accounts of the Company pursuant to Clause 32
 of the Listing Agreement are furnished separately.
 
 J. EMPLOYEES
 
 Key Managerial Personnel (KMP)
 
 The following have been designated as the Key Managerial Personnel of
 the Company pursuant to sections 2(51) and 203 of the Companies Act,
 2013 read with the Companies (Appointment and Remuneration of
 Managerial Personnel) Rules, 2014:
 
 a) Mr. Anand G. Mahindra - Chairman & Managing Director
 
 b) Dr. Pawan Goenka - Executive Director - Mahindra & Mahindra & Group
 President (Auto and Farm Sector)
 
 c) Mr. V S Parthasarathy - Group CFO, Group CIO & President (Group
 Finance and M&A)
 
 d) Mr. Narayan Shankar - Company Secretary
 
 None of the KMP has resigned during the year under review.
 
 Employees'' Stock Option Scheme
 
 During the year under review, the Trustees of Mahindra & Mahindra
 Employees'' Stock Option Trust have not granted any Stock Options to
 employees under the Mahindra & Mahindra Limited Employees Stock Option 
 Scheme 2010 and the Mahindra & Mahindra Limited Employees Stock Option 
 Scheme 2000 (hereinafter collectively referred to as the Schemes).
 
 Details of the shares issued under the Schemes, as also the disclosures
 in compliance with SEBI (Share Based Employee Benefits) Regulations,
 2014 read with erstwhile SEBI (Employees Stock Option Scheme and
 Employees Stock Purchase Scheme) Guidelines, 1999 are set out in
 Annexure II to this Report.
 
 Particulars of Employees and related disclosures
 
 The Company had 404 employees who were in receipt of remuneration of
 not less than Rs. 60,00,000 during the year ended 31st March, 2015 or
 not less than Rs. 5,00,000 per month during any part of the year.
 
 Disclosures with respect to the remuneration of Directors, KMPs and
 employees as required under section 197 of the Companies Act, 2013 read
 with Rule 5 (1) of the Companies (Appointment and Remuneration of
 Managerial Personnel) Rules, 2014 are given in Annexure III to this
 Report.
 
 Details of employee remuneration as required under provisions of
 section 197 of the Companies Act, 2013 read with Rule 5(2) & 5(3) of
 Companies (Appointment and Remuneration of Managerial Personnel) Rules,
 2014 are available at the Registered Office of the Company during
 working hours 21 days before the Annual General Meeting and shall be
 made available to any Shareholder on request. Such details are also
 available on your Company''s website at: http://www.mahindra.
 com/Investors/Mahindra-and-Mahindra/Resource
 
 Industrial Relations
 
 The year under review has witnessed positive vibes in Industrial
 Relations Scenario across all manufacturing locations for the
 Automotive and Farm Equipment Sectors.
 
 Employees have always been valuable assets of the Company and focus was
 laid in propagating proactive and employee centric practices at the
 shop floor. The Company''s endeavour has been to ensure transparent
 communication of overall business goals and implement an efficient
 concern resolution mechanism.
 
 Your Company has adopted a more holistic approach to enhance skill and
 capabilities of employees at the shop floor through Mahindra Skill
 Excellence Initiative. For the year under review, there was
 participation of over 1,800 employees across all manufacturing
 facilities. Your Company had one highly skilled associate, representing
 India at the World Skill Competition 2014, held at Leipzig Germany.
 
 Over the years, your Company has inculcated a culture of continuous
 improvement through investment in training of employees for resolving
 quality concerns, reducing cost, ensuring safety and improving
 productivity. Processes have been established wherein employees are
 encouraged to generate and implement improvement ideas. For the year
 under review, the workmen generated about 20 ideas per person.
 
 Your Company has taken initiatives to measure Employee Engagement and
 Satisfaction through an Employee Satisfaction Survey (ESS). Employee
 Engagement for all the Company''s Plants shows improvement over the
 previous years.
 
 In January, 2015, your Company signed a wage settlement at the
 Automotive Unit of the Zaheerabad Plant.
 
 The proactive and participative approach adopted, has benefitted the
 Company not just with zero production loss in the Financial Year, but
 has also helped create a peaceful, healthy and collaborative work
 environment.
 
 Safety, Occupational Health and Environment
 
 Your Company has a well-established Safety, Occupational Health &
 Environmental Policy (SH&E Policy) which is in line with the National
 Safety, Occupational Health & Environmental Policy. The Company Policy
 has been further drilled down, through the Policy for the Automotive
 and Farm Equipment Sectors, followed by the respective Plant Policy.
 Each Plant has displayed and communicated the SH&E Policy to all
 stakeholders.  Objectives and Targets derived from the new amended SH&E
 Policy are supported by focussed management programs, safety i4, safety
 Kaizens and mistake proofing projects.
 
 The Safety & Occupational Health of its employees is embedded as core
 organisational values of your Company. The SH&E Policy, inter alia,
 covers and ensures safety of public, employees, plant and equipment,
 ensures compliance on a monthly basis, imparts training to all its
 employees and stakeholders as per training calendar. It also carries
 out statutory safety assurance and audits of its facilities by
 absorbing all new amended legal requirements, conducts regular internal
 and external medical and occupational check-up of its employees and
 promotes health-friendly sustainable activities.
 
 Your Company continued with its commitment to improve the wellbeing of
 its employees and contract workmen by establishing Health and Wellness
 Goals. To achieve the same, your Company organised Occupational Health
 Examination Camps, medical check-ups, consultation and counselling
 sessions. Way2Wellness training sessions covering topics on
 Health were conducted. World Health Day, World Heart Day, World Kidney
 Day and World Diabetes Day are being celebrated.
 
 Your Company observed Road Safety Week, Safety Week and Fire Service
 Day across locations with active participation from employees and other
 stakeholders. World Environment Day, World Earth Day, World Water Day,
 Energy Conservation Week and Water Conservation Week are being
 celebrated through stakeholder engagement and employee''s involvement.
 
 Your Company''s sustainability roadmap is based on the fundamentals of
 Planet, People and Profit. Various projects have been implemented by
 your Company by effective implementation of management driven
 initiatives in the areas of Air Pollution, Water, Waste Water, Solid
 Waste Management and Greenbelt Development with new techniques.
 
 Your Company''s Sustainability Reporting System, provides a framework
 for setting and review of targets towards Safety, Health and
 Environment.
 
 All Plants of the Automotive and Farm Equipment Sectors have been
 recertified with amended standard for ISO 14001: 2004 & OHSAS 18001:
 2007.
 
 Your Company''s commitment to environment stems from the Mahindra
 Group''s abiding concern for Stakeholder engagement. The Company has
 ensured that its operations have a minimal impact on the environment by
 implementing a robust Environmental Management System. Further, your
 Company has taken initiatives to extend sustainability awareness to its
 business associates through ''Green Supply Chain Management''. Support is
 also provided by conducting risk management exercise.
 
 Goals on Sustainable development are included in the Balanced Scorecard
 for various businesses under the Automotive and Farm Equipment Sectors.
 These measures have seen an improvement in performance year on year.
 
 K. BOARD & COMMITTEES
 
 Directors
 
 The Board of Directors based on the recommendation of the Governance,
 Nomination and Remuneration Committee had appointed Mr. Bharat Doshi as
 an Additional Director of the Company with effect from 14th November,
 2013. Thereafter at the Annual General Meeting of the Company held on
 8th August, 2014 he was appointed as a Director liable to retire by
 rotation.
 
 The Board of Directors based on the recommendation of the Governance,
 Nomination and Remuneration Committee had appointed Mr. S. B. Mainak as
 an Additional Director of the Company representing Life Insurance
 Corporation of India with effect from 13th November, 2013. Thereafter
 at the Annual General Meeting of the Company held on 8th August, 2014
 he was appointed as a Director liable to retire by rotation.
 
 The Board of Directors had based on the recommendation of the
 Governance, Nomination and Remuneration Committee and subject to the
 approval of the Members to be obtained at the ensuing Annual General
 Meeting of the Company, appointed Dr. Pawan Goenka as an Additional
 Director and Executive Director of the Company for a period of 5 years
 with effect from 23rd September, 2013 to 22nd September, 2018.
 Thereafter at the Annual General Meeting of the Company held on 8th
 August, 2014 he was appointed as a Director liable to retire by
 rotation and as an Executive Director of the Company.
 
 The Board of Directors at its Meeting held on 30th May, 2014 had
 appointed Mr. M. M. Murugappan, Mr. Deepak S. Parekh, Mr. Nadir B.
 Godrej, Mr. R. K. Kulkarni, Mr. Anupam Puri, Dr. Vishakha N. Desai and
 Mr. Vikram Singh Mehta as Independent Directors, based on the
 recommendation of the Governance, Nomination and Remuneration
 Committee. The Members of the Company at the Annual General Meeting
 held on 8th August, 2014 appointed Mr. R. K. Kulkarni, Mr. Anupam Puri,
 Dr. Vishakha N. Desai and Mr. Vikram Singh Mehta as Independent
 Directors for a period of 5 consecutive years commencing from 8th
 August, 2014, Mr. M. M. Murugappan and Mr. Nadir B. Godrej for a period
 of 4 consecutive years commencing from 8th August, 2014 and Mr. Deepak
 S.  Parekh for a period of 3 consecutive years commencing from 8th
 August, 2014.
 
 As mentioned in the previous Annual Report, Mr. Narayanan Vaghul and
 Mr. A. K. Nanda did not seek re-appointment and accordingly ceased to
 be Directors upon expiry of their term at the 68th Annual General
 Meeting held on 8th August, 2014.
 
 Mr. Anand G. Mahindra retires by rotation and, being eligible, offers
 himself for re-appointment at the 69th Annual General Meeting of the
 Company scheduled to be held on 7th August, 2015.
 
 Mr. Bharat Doshi, Non-Executive Director has conveyed his desire to
 relinquish his position as a Director of the Company with effect from
 the conclusion of the 69th Annual General Meeting scheduled to be held
 on 7th August, 2015.
 
 The Board acceded to his request and placed on record its deep
 appreciation of the invaluable counsel rendered by Mr. Bharat Doshi to
 the Company during his tenure as a Director of the Company.
 
 Quote from Chairman Emeritus
 
 Bharat Doshi joined the Company in 1973. He was elected to the M&M
 Board in 1992 and appointed Executive Director thereafter.
 
 Bharat in his capacity as Group CFO laid down uncompromising standards
 of value and ethics which led to transparency, trust and confidence. He
 created operational techniques, which guided the Organisation in its
 efforts to achieve excellence.  His unique understanding of human
 nature endeared him to many and earned him universal respect.
 
 Bharat truly epitomizes the resilient character of M&M''s culture.
 Although he is stepping down from the M&M Board, I am very happy that
 he will continue to be associated with the Group in other areas. His
 knowledge and experience will continue to be available to the Group.
 
 The Company has received declarations from all the Independent
 Directors of the Company confirming that they meet the criteria of
 independence as prescribed both under the Companies Act, 2013 and
 Clause 49 of the Listing Agreement entered with the Stock Exchanges.
 
 Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of
 the Listing Agreement, the Board has carried out an annual evaluation
 of its own performance and that of its Committees as well as
 performance of the Directors individually.  Feedback was sought by way
 of a structured questionnaire covering various aspects of the Board''s
 functioning such as adequacy of the composition of the Board and its
 Committees, Board culture, execution and performance of specific
 duties, obligations and governance and the evaluation was carried out
 based on responses received from the Directors.
 
 A separate exercise was carried out by the Governance, Nomination and
 Remuneration Committee of the Board to evaluate the performance of
 individual Directors. The performance evaluation of the Non-Independent
 Directors and the Board as a whole was carried out by the Independent
 Directors. The performance evaluation of the Chairman of the Company
 was also carried out by the Independent Directors, taking into account
 the views of the Executive Director and Non-Executive Directors. The
 Directors expressed their satisfaction with the evaluation process.
 
 The details of programs for familiarisation of the Independent
 Directors with the Company, their roles, rights, responsibility in the
 Company, nature of the industry in which the Company operates, business
 model of the Company and related matters are available on the website
 of the Company at the web-link:
 http://www.mahindra.com/Investors/Mahindra-and-Mahindra/ Governance
 
 In line with the principles of transparency and consistency, your
 Company has adopted the following Policies which, inter alia, include
 criteria for determining qualifications, positive attributes and
 independence of a Director.
 
 a) Policy on Appointment of Directors and Senior Management and
 succession planning for orderly succession to the Board and the Senior
 Management.
 
 b) Policy for remuneration of the Directors, Key Managerial Personnel
 and other employees.
 
 The Policies mentioned at ''a'' and ''b'' above are attached as Annexure
 IV-A and IV-B respectively and form part of this Report.
 
 Directors'' Responsibility Statement
 
 Pursuant to section 134(5) of the Companies Act, 2013, your Directors,
 based on the representations received from the Operating Management,
 and after due enquiry, confirm that:
 
 (a) in the preparation of the annual accounts for the Financial Year
 ended 31st March, 2015, the applicable accounting standards have been
 followed;
 
 (b) the Directors had in consultation with Statutory Auditors, selected
 accounting policies and applied them consistently, and made judgments
 and estimates that are reasonable and prudent so as to give a true and
 fair view of the state of affairs of the Company as at 31st March, 2015
 and of the profit of the Company for the year ended on that date;
 
 (c) the Directors have taken proper and sufficient care for the
 maintenance of adequate accounting records in accordance with the
 provisions of the Companies Act, 2013 for safeguarding the assets of
 the Company and for preventing and detecting fraud and irregularities;
 
 (d) the Directors have prepared the annual accounts on a going concern
 basis;
 
 (e) the Directors have laid down adequate Internal Financial Controls
 to be followed by the Company and such Internal Financial Controls were
 operating effectively during the Financial Year ended 31st March, 2015;
 
 (f) the Directors had devised proper systems to ensure compliance with
 the provisions of all applicable laws and that such systems were
 adequate and operating effectively throughout the Financial Year ended
 31st March, 2015.
 
 Board Meetings and Annual General Meeting
 
 A calendar of Meetings is prepared and circulated in advance to the
 Directors.
 
 During the year 1st April, 2014 to 31st March, 2015, five Board
 Meetings were held on the following dates - 30th May, 2014, 8th August,
 2014, 31st October, 2014, 13th February, 2015 and 26th March, 2015. The
 68th Annual General Meeting (AGM) of the Company was held on 8th
 August, 2014.
 
 Meetings of Independent Directors
 
 The Independent Directors of the Company meet before the Board Meetings
 without the presence of the Chairman & Managing Director or Executive
 Director or other Non-Independent Directors or Chief Financial Officer
 or any other Management Personnel.
 
 These Meetings are conducted in an informal and flexible manner to
 enable the Independent Directors to discuss matters pertaining to,
 inter alia, review of performance of Non-Independent Directors and the
 Board as a whole, review the performance of the Chairman of the Company
 (taking into account the views of the Executive and Non-Executive
 Directors), assess the quality, quantity and timeliness of flow of
 information between the Company Management and the Board that is
 necessary for the Board to effectively and reasonably perform their
 duties.
 
 Audit Committee
 
 This Committee comprises of the following Directors viz.  Mr. Deepak S.
 Parekh (Chairman of the Committee), Mr. Nadir B. Godrej, Mr. M. M.
 Murugappan, Mr. R. K. Kulkarni and Mr. Bharat Doshi. Except for Mr.
 Bharat Doshi, all the Members are Independent Directors. All the
 Members of the Committee possess strong accounting and financial
 management knowledge. The Company Secretary of the Company is the
 Secretary of the Committee.
 
 All the recommendations of the Audit Committee were accepted by the
 Board.
 
 L. GOVERNANCE
 
 Corporate Governance
 
 Your Company has a rich legacy of ethical governance practices many of
 which were implemented by the Company, even before they were mandated
 by law. Your Company is committed to transparency in all its dealings
 and places high emphasis on business ethics. A Report on Corporate
 Governance along with a Certificate from the Statutory Auditors of the
 Company regarding compliance with the conditions of Corporate
 Governance as stipulated under Clause 49 of the Listing Agreement form
 part of this Annual Report.
 
 Vigil Mechanism
 
 The Vigil Mechanism as envisaged in the Companies Act, 2013, the Rules
 prescribed thereunder and the Listing Agreement is implemented through
 the Company''s Whistle Blower Policy to enable the Directors and
 employees of the Company to report genuine concerns, to provide for
 adequate safeguards against victimisation of persons who use such
 mechanism and make provision for direct access to the Chairman of the
 Audit Committee.
 
 Whistle Blower Policy of the Company is available on the Company''s
 website at the web-link: http://www.mahindra.
 com/Investors/Mahindra-and-Mahindra/Governance
 
 Further details are available in the Report on Corporate Governance
 that forms part of this Annual Report.
 
 The Sexual Harassment of Women at Workplace (Prevention, Prohibition
 and Redressal) Act, 2013
 
 The Company has in place an Anti-Sexual Harassment Policy in line with
 the requirements of the Sexual Harassment of Women at Workplace
 (Prevention, Prohibition and Redressal) Act, 2013. Internal Complaints
 Committee (ICC) has been set up to redress complaints received
 regarding sexual harassment.  All employees (permanent, contractual,
 temporary, trainees) are covered under this Policy. The Policy is
 gender neutral.
 
 The following is a summary of sexual harassment complaints received and
 disposed off during the year 2014-15:
 
 (a) Number of complaints of sexual harassment received during the year
 - 3
 
 (b) Number of complaints disposed off during the year - 3
 
 (c) Number of cases pending for more than 90 days - 0
 
 (d) Number of workshops/awareness programme against sexual harassment
 carried out - 10
 
 (e) Nature of action taken by the employer or District Officer - 1
 Warning Letter, 2 Respondent Employees Resigned.
 
 Business Responsibility Report
 
 The ''Business Responsibility Report'' (BRR) of your Company for the year
 2014-15 forms part of this Annual Report, in compliance with Clause 55
 of the Listing Agreement. This disclosure on certain non-financial
 parameters is a mandatory requirement for the top 100 listed companies
 (based on market capitalisation) on the National Stock Exchange of
 India Limited and BSE Limited.
 
 Your Company strongly believes that sustainable and inclusive growth is
 possible by using the levers of environmental and social responsibility
 while setting aspirational targets and improving economic performance
 to ensure business continuity and rapid growth. Your Company is
 committed to leverage ''Alternative Thinking'' to build competitive
 advantage in achieving high shareholder returns through customer
 centricity, innovation, good governance and inclusive human development
 while being sensitive to the environment.
 
 Risk Management
 
 Your Company has a well-defined risk management framework in place. The
 risk management framework works at various levels across the
 enterprise. These levels form the strategic defence cover of the
 Company''s risk management. The Company has a robust Organisational
 structure for managing and reporting on risks.
 
 Your Company has constituted a Risk Management Committee of the Board
 which is authorised to monitor and review risk management plan and risk
 certificate. The Committee is also empowered, inter alia, to review and
 recommend to the Board the modifications to the Risk Management Policy.
 Further, the Board has constituted a Corporate Risk Council comprising
 the Senior Executives of the Company. The terms of reference of the
 Council comprises review of risks and Risk Management Policy on
 periodic intervals.
 
 The Board has approved the modifications to the Risk Management Policy
 which are made with the intention of increasing the spectrum and reach
 of the risk management processes across the Company. The Risk
 Management Policy, inter alia, includes identification therein of
 elements of risk, including those that may threaten the existence of
 the Company. Risk management process has been established across the
 organisation and is designed to identify, assess and frame a response
 to threats that affect the achievement of its objectives. Further, it
 is embedded across all the major functions and revolves around the 
 goals and objectives of the organisation.
 
 M. CORPORATE SOCIAL RESPONSIBILITY AND RELATED MATTERS
 
 Corporate Social Responsibility (CSR)
 
 Since its inception your Company has been a socially responsible
 corporate, making investments in the community which go beyond any
 mandatory legal and statutory requirements. The redefined ''Core
 Purpose'' of the Company is to challenge conventional thinking and
 innovatively use all our resources to drive positive change in the
 lives of our stakeholders and communities across the world, to enable
 them to RISE. In line with the Company''s Core purpose, the CSR vision
 is to focus our efforts within the constituencies of girls, youth &
 farmers by innovatively supporting them through programs designed in
 the domains of education, health and environment, while harnessing the
 power of technology. By investing our CSR efforts in these critical
 constituencies which contribute to nation building and the economy,
 your Company will enable the stakeholders and communities to RISE.
 
 CSR Policy
 
 The Corporate Social Responsibility Committee had formulated and
 recommended a Corporate Social Responsibility Policy to the Board of
 the Company which was subsequently adopted by it and is being
 implemented by the Company. The web-link to the CSR Policy is -
 http://www.mahindra.com/
 resources/RHS-Elements/5.0-How-we-help/Mahindra-CSR- Policy.pdf
 
 A brief overview of projects or programs proposed to be undertaken is
 available at the web-link http://www.mahindra.  com/How-We-Help
 
 CSR Committee
 
 Your Company has constituted a CSR Committee comprising of Dr. Vishakha
 N. Desai (Chairperson), Mr. Anand G. Mahindra, Mr. Bharat Doshi, Mr. R.
 K. Kulkarni, Dr. Pawan Goenka and Mr. Vikram Singh Mehta to monitor the
 CSR activities.
 
 CSR Initiatives
 
 Major CSR initiatives undertaken by the Company during the Financial
 Year 2014-15 were as follows:
 
 a. Project Nanhi Kali: Provision of educational support to
 underprivileged girls from poor urban, remote rural and conflict
 afflicted communities across India.
 
 b. Mahindra Pride School: Livelihood training program for youth from
 socially and economically disadvantaged groups.
 
 c. Lifeline Express: A Mobile hospital on a train, providing medical
 interventions and surgeries in remote rural areas.
 
 d. Mahindra Hariyali: Afforestation initiative to improve green cover
 and protect bio-diversity in the country and also contribute to the
 livelihood of farmers.
 
 e. Swachh Bharat Swachh Vidyalaya: Construction of toilets primarily
 for girls in Government Schools.
 
 f. Integrated Watershed Development Project: A public private
 partnership with the Government of Madhya Pradesh for conservation of
 soil and water.
 
 g. Mahindra Saarthi Abhiyaan: Scholarships to daughters of truck
 drivers which allow them to pursue higher education thus reducing drop
 outs amongst girls.
 
 h. Vijay Vidharba: Improving livelihood opportunities and prosperity
 of farmers by training them in effective farming practices including
 soil health, crop planning, creating model farms with bio-dynamic
 farming practices, etc., thereby increasing crop productivity.
 
 i. Biogas Project: Setting up a biogas plant to covert food waste and
 other waste into energy.
 
 j. BAJA: Training under-graduate engineering students in automotive
 engineering enabling them to get jobs in the automobile industry.
 
 k. Employee Social Options (Esops): The Company''s Esops program
 supports employees in creating volunteering projects based on the needs
 of underprivileged communities in and around their places of work.
 
 During the year under review, your Company spent Rs. 83.24 crores on
 CSR activities. The amount equal to 2% of the average net profit for
 the past three Financial Years is Rs. 83.03 crores. The detailed Annual
 Report on CSR activities is annexed herewith and marked as Annexure V.
 
 Sustainability Initiatives
 
 During the year under review, the 7th Sustainability Report for the
 year 2013-14 was released and like earlier six years this Report was
 also externally assured by KPMG with GRI checked application level A .
 
 Your Company continued its ''Sustainability'' journey retaining the focus
 on Environmental, Social and Governance (ESG) parameters, through
 successful implementation of several projects like water management and 
 energy conservation, while consolidating the initiatives of the 
 previous years.
 
 Over the years, after consistently evolving on sustainability
 performance, it was time for your Company to significantly raise the
 bar and widen the sustainability horizon. During the year under review,
 your Company looked deeper into existing as well as emerging
 materiality issues and aligned the sustainability actions with newer
 expectations of external stakeholders to crystallise business specific
 Sustainability Roadmap for a period of 3 years.  The issues included in
 the roadmaps are Eco-efficiency, Green Supply Chain Management,
 Responsible Product Development, Employee Care and Development and
 Community Development.  To ensure that the roadmaps remain relevant at
 all times, an annual review and realignment process has been put in
 place.
 
 During the year, your Company achieved the status of being a Water
 Positive Company using offsetting methodology.  The Micro Irrigation
 installations in Gujarat have saved 8.4 million m3 of water against the
 6.1 million m3 water consumed by the entire Mahindra Group Companies
 put together. This is verified with limited level of assurance by
 Bureau Veritas Certification (BVCI) based on references, data,
 documentation, records and invoices submitted. This is a step towards
 conserving water which is a fast depleting essential resource for
 survival.
 
 Your Company also believes in actively collaborating with the other
 players in the Indian Industry to respond to the Country''s emerging
 challenges. Hence, your Company has signed up for the India Business
 and Bio-diversity Initiative (IBBI) with CII-ITC CESD.
 
 Complete details of the Sustainability performance for 2014-15 will be
 elaborated in the GRI Report which is under preparation and will be
 ready for release shortly.
 
 The consistent performance of your Company on the ESG dimensions was
 recognised during the year, by way of:
 
 * Getting listed on the Dow Jones Sustainability Index - 2014 under the
 ''Emerging Market Index'' for the consecutive second year with
 improvement in percentile scores.
 
 * Retaining its position in the top 10 in the India 200 Carbon
 Disclosure Leadership Index 2014.
 
 * Appearing 3rd in the list of Top 100 companies in India for
 Sustainability and CSR presented by Economic Times Corporate Dossier,
 in partnership with Futurescape and IIM Udaipur.
 
 * Featuring in Sustainalytics - Channel NewsAsia Sustainability Ranking
 - the first of its kind in Asia.
 
 Conservation of Energy, Technology Absorption and Foreign Exchange
 Earnings and Outgo
 
 The information pertaining to conservation of energy, technology
 absorption, foreign exchange earnings and outgo as required under
 section 134(3)(m) of the Companies Act, 2013 read with Rule 8(3) of the
 Companies (Accounts) Rules, 2014 is furnished in Annexure VI and is
 attached to this Report.
 
 N. SECRETARIAL
 
 Share Capital
 
 During the year under review, your Company allotted 52,00,000 Ordinary
 (Equity) Shares of Rs. 5 each to the Trustees of Mahindra & Mahindra
 Employees'' Stock Option Trust.  Consequently, the issued, subscribed
 and paid-up Share Capital of the Company stood at Rs. 310.55 crores as
 at 31st March, 2015 comprising of 62,10,92,384 Ordinary (Equity) Shares
 of Rs. 5 each fully paid-up.
 
 Extract of Annual Return
 
 Pursuant to sub-section 3(a) of section 134 and sub-section (3) of
 section 92 of the Companies Act, 2013 read with Rule 12(1) of the
 Companies (Management and Administration) Rules, 2014, an extract of
 the Annual Return as on 31st March, 2015 in Form No. MGT 9 is attached
 herewith as Annexure VII and forms part of this Report.
 
 General
 
 The Chairman & Managing Director of the Company did not receive any
 remuneration or commission from any of its subsidiaries. The Whole 
 Time Director of the Company did not receive any commission from any 
 of its subsidiaries. However, the Whole Time Director has exercised 
 ESOPs of subsidiaries of the Company during the year, which were 
 granted in the earlier year(s).
 
 Your Directors state that no disclosure or reporting is required in
 respect of the following items as there were no transactions/ events on
 these items during the year under review:
 
 1. Issue of equity shares with differential rights as to dividend,
 voting or otherwise.
 
 2. Issue of Shares (Including Sweat Equity Shares) to employees of the
 Company under any Scheme save and except ESOS referred to in this
 Report.
 
 3.  Significant or material orders passed by the Regulators or Courts
 or Tribunals which impact the going concern status and the Company''s
 operations in future.
 
 4.  Voting rights which are not directly exercised by the employees in
 respect of shares for the subscription/ purchase of which loan was
 given by the Company (as there is no scheme pursuant to which such
 persons can beneficially hold shares as envisaged under section
 67(3)(c) of the Companies Act, 2013).
 
                                          For and on behalf of the Board
 
                                                 ANAND G. MAHINDRA
                                            Chairman & Managing Director
 
 Mumbai, 29th May, 2015
 
Source : Dion Global Solutions Limited
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