Minda Industries Limited Annual Report Building Trust. Expanding
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th 28 ANNUAL REPORT 2019-20 Minda Industries Limited BUILDING TRUST. EXPANDING POSSIBILITIES. Building Trust. Expanding Possibilities. Walking along the path of persistence and perseverance, comes success. Every attempt, big or small, brings along opportunities to learn and surmount new obstacles. Every change, predictable or unpredictable, builds our ability to adapt and innovate. Together these build trust that translate into strength. Every challenge and adversity offers a chance to explore and flourish. It brings along the possibility to further expand the existing horizon, while growing on the way, beating all the odds. For more investor related information please visit https://www.unominda.com/investor or simply scan to browse Beating the Odds Sustenance. Experience. Strength. Development. Sustenance leads to experience. Experience leads to strength. Strength leads to development and being future ready. Together these build positivity to beat any doubts. It aids building determination to defeat obstructions. It nurtures the ability for beating the odds. At a time when it is crucial for all the auto component manufacturers to sustain in prevailing conditions, At a time when delivering on stakeholders’ expectations is more important than ever, Our diverse range of products, impeccable service and cutting-edge technology is helping us beat the odds. It equips us with a strength that helps turn every odd into an opportunity. Backed by strong R&D, customer-centric approach and state-of-the-art technology, the Company is instrumental in developing brilliant and pioneering solutions for the existing as well as future trends. Beating the odds pens down the story of Minda Industries Limited’s (‘MIL’) strategy of using its strengths and relationships built over the years. It is a narrative demonstrating how we continue to be robust despite the prevailing industry scenario while confidently striding towards the future. Himalayan Rallies are at the epitome of ‘Beating the Odds’ as the terrains and weather - the odds are stacked for the rider. Across the Pages Chairman and Managing Who we are Beating the Odds: Director’s Message with robust business model 4-7 8-11 12-13 Beating the Odds: Beating the Odds: Beating the Odds: with meaningful by building strength and by technology led engagement reinventing acquisitions 14-15 16-17 18-19 Beating the Odds: About CREAT About INITIA with expansion and moving up the value chain 20-21 22-23 24-25 Beating the Odds: Beating the Odds: Message from CFO by innovation and with extensive global reinventing 26-27 reach 28-29 30-33 Beating the Odds: Beating the Odds: Board of Directors with achievements building trust – community and recognitions development 34-35 36-37 38-39 Top Management Team Corporate Information Synopsis of Group 41 40 42 Companies Statutory Reports Financial Statments 43 Board’s Report 109: Standalone 59 Corporate Governance 190: Consolidated 43-108 91 Management Discussion 109-288 and Analysis 103 Business Responsibility Report INVESTOR INFORMATION BSE Code : 532539 NSE Symbol : MINDAIND Bloomberg Code : MNDA: Natl India 5,465 Crore 619 Crore 266 Crore Revenue Earnings before interest, Profit before tax tax, depreciation and Before Exceptional Item amortisation Switching Systems Lighting Systems Other Products Crore Crore 2,014 1,223 794 Crore Revenue Revenue Revenue 199 Crore 95 Crore 74 Crore EBITDA EBITDA EBITDA Acoustic Systems Light Metal Technology After Market Sales Crore 653 Crore 781 558 Crore Revenue Revenue Revenue 47 Crore 204 Crore 11 Crore EBITDA EBITDA EBITDA Minda Industries Limited Chairman and Managing Director’s Message Despite significant decline across segments, we focused on limiting the decline through our diversified product portfolio, customer mix and cost management drive. 4 Annual Report 2019-20 Corporate Overview Statutory Reports Financial Statements Dear Stakeholders, The financial year 2019-20 saw the Indian automobile future opportunities through sustainable platforms, we industry battered by an unprecedented growth. The entered into a definitive agreement with shareholders slowdown in the economy shadowed its effects on the of the Germany-based automotive lamps engineering, industry, resulting in the worst performance ever in last design and testing Company, Delvis Gmbh. The acquisition 20 years. The depressed demand over the last one year, is a part of our strategy to strengthen technological forced manufacturers to cut production output and offer capabilities in existing product lines. Navigating the steep discounts. Moreover, the transition from BS IV to BS global lighting technology, this acquisition will help us VI also added to the fall. Overall, the sector saw a double- leverage extensive R&D capabilities of Delvis in the Indian digit decline of 15% in volume terms on y-o-y basis. Lastly, automotive space. Refer page 18 towards the end of the financial year, Covid-19 struck India, which resulted in the temporary shutdown of economic Harita Seating Systems is a quality-focused, system- activities. This further dampened the industry sentiments driven organisation, engaged in manufacturing, product and prodded production cuts. development and sales of driver seats and bus passenger seats. Last year, the Company approved the merger Demonstrating the strength and robustness of our of HSSL with MIL. The matter has been delayed due to business model, in these subdued market conditions, Covid-19, but once we have approval in place it will take we continued our pursuit of excellence. We continued around 3 months roughly to complete the entire process to perform better than the industry, while beating the thereafter. odds. Our relentless focus on innovation has continued to differentiate MIL. This has helped us design products I am glad to inform that during the year, the merger with prime importance and relevance with respect to process of 4 wholly-owned subsidiaries was completed. the future. With the right capabilities and strategies, we This merger will help us realise synergies and economy are fully aligned with the megatrends that will shape our of scale benefits besides strengthening our standalone markets and drive the future growth. balance sheet. Performance highlights As part of our consolidation strategy, the Company Despite significant decline across segments, we focused has planned acquisition and amalgamation of Minda I on limiting the decline through our diversified product Connect Private Limited into MIL at an equity valuation of portfolio, customer mix and cost control drive. Aligned ` 17 Crores. The merger process will be taken through SEBI with our business principles, we are continuously exchanges and it has been filed with the exchanges for exploring opportunities to optimise overall revenue mix approval. while being focused on enhancing the kit value. Innovation and more Highlights for the year We continued to invest in innovation to target the future Our technology acquisitions and collaborations have growth, in line with our strategy and purpose. In addition, helped us find our strengths and attain technological our recent technology acquisitions and investments are leadership in the industry. Over the years, they have delivering product development opportunities which could assisted in making good progress while contributing a generate meaningful sales over the next five to ten years. significant share to the revenues. To seize all the exciting The team at our technical centre ‘CREAT’ have identified Annual Report 2019-20 5 Minda Industries Limited future areas for UNO MINDA. These include segments like: stay ahead of this situation and make the right and best decisions to ensure the safety of our families, friends, • Controllers customers, and supply partners. • Lighting • Advanced Driver Assistance Systems Our industry and our world have UNO MINDA’s commitment • Infotainment & Connectivity to health and safety during this crisis and beyond. To the 22,000 global members of #TeamUNOMINDA: thank you • Telematics & IOT for continuing to do what is best for UNO MINDA and our • Electric Vehicle Technologies communities every day. We are in this together. Refer page 20 Going further, the current situation has opened several Covid-19 Response opportunities for India to acquire new room in the As the global impact of Covid-19 continues to evolve, UNO overseas markets. As companies across the world look MINDA’s leadership team is continuing to closely monitor to de-risk and diversify their supply chains or relocate the situation along with support from UNO MINDA’s their manufacturing hubs, we will continue to explore and Covid-19 Task Force. The actions we have taken and will leverage our capabilities. continue to take have the health and safety of UNO MINDA associates and our communities as the primary focus. We have renewed our commitment to collaborate for a We have communication and business plans in place for greater good of our stakeholders. I would like to take this every UNO MINDA location around the world, assisting our opportunity to show our appreciation to our employees leadership teams in making swift decisions pertaining to who, individually and collectively, make us a better and facility operations in accordance with all local, state, and stronger organisation. I also extend my gratitude to our national government orders and mandates. customers, stakeholders, and suppliers for their loyalty and trust in us. Lastly, I express my sincere appreciation to We have taken hard calls in eliminating waste and aligning