Mahindra & Mahindra, Ltd.

Company Profile

Publication Date: 24 Feb 2012

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Mahindra & Mahindra, Ltd. Page 2 © Datamonitor Mahindra & Mahindra, Ltd. TABLE OF CONTENTS

TABLE OF CONTENTS

Company Overview...... 4 Key Facts...... 4 Business Description...... 5 History...... 7 Key Employees...... 12 Key Employee Biographies...... 14 Major Products and Services...... 21 Revenue Analysis...... 23 SWOT Analysis...... 25 Top Competitors...... 32 Company View...... 33 Locations and Subsidiaries...... 47

Mahindra & Mahindra, Ltd. Page 3 © Datamonitor Mahindra & Mahindra, Ltd. Company Overview

COMPANY OVERVIEW

Mahindra & Mahindra, Ltd. (M&M or ‘the group’) is a flagship company of the Mahindra Group, which through its subsidiaries, is primarily engaged in manufacturing and marketing of a range of utility vehicles. In addition, it also provides farm equipment services, steel trading and processing services, financial services, infrastructure development, hospitality services, information technology services, systech, and other services. The group operates in Asia, Americas, Europe, Middle East and Africa and Australia. It is headquartered in Mumbai, India and employs around 17,577 people.

The group recorded revenues of INR323,899.9 million ($7,061 million) during the financial year ended March 2011 (FY2011), an increase of 28% over FY2010. The operating profit of the group was INR5,240.3 million ($114.2 million) in FY2011, as compared to an operating loss of INR17,573.6 million ($383.1 million) in FY2010.The net profit was INR30,797.3 million ($671.4 million) in FY2011, an increase of 24.3% over FY2010.

KEY FACTS

Head Office Mahindra & Mahindra, Ltd. Mahindra Towers G.M. Bhosale Marg Worli Mumbai Maharashtra 400 018 IND Phone 91 22 2497 5074 Fax 91 22 2490 0833 Web Address http://www.mahindra.com Revenue / turnover 323,899.9 (INR Mn) Financial Year End March Employees 17,577 Bombay Stock 500520 Exchange Ticker National of India M Ticker London Stock MHID Exchange Ticker

Mahindra & Mahindra, Ltd. Page 4 © Datamonitor Mahindra & Mahindra, Ltd. Business Description

BUSINESS DESCRIPTION

Mahindra & Mahindra, Ltd. (M&M or ‘the group’) is an Indian manufacturer and marketer of utility vehicles, and tractors. It also provides farm equipment, steel trading and processing, financial, infrastructure development, hospitality, information technology services.The group operates in Asia, Americas, Europe, Middle East and Africa and Australia. At the end of March 2011, the group comprised of the flagship holding company, Mahindra & Mahindra Limited, 110 subsidiaries, 6 joint ventures and 13 associates.

The group mainly operates through nine segments including automotive, farm equipment, Systech, IT (information technology) services, financial services, steel trading and processing, hospitality, infrastructure and other segments.

M&M’s automotive segment comprises of sales of automobiles, spare parts and related services. The group manufactures and markets utility vehicles and light commercial vehicles including three-wheelers. It exports its automotive products to several regions including Europe, Africa, South America, South Asia and the Middle East. In FY2011, M&M automotive segment recorded total sales of 289,333 vehicles and 64,740 three-wheelers in which, the group sold 274,793 vehicles including 230,110 multi utility vehicles (MUVs), 35,493 small 4-wheelers (0.75 ton cargo/passenger) and 9,190 mini four-wheelers (0.5 ton cargo/passenger). Similarly, the group sold 14,540 vehicles including 305 vehicles sourced from Mahindra Navistar Automotives, and 2,598 three-wheelers in the overseas market. M&M markets its vehicles under Alfa, Bolero, Genio, Gio, Korando, Kyron, Loadking, Logan, Maxximo, REVA Electric Cars, Rexton II, Rodius, Scorpio, Thar, Verito, XUV 500 and Xylo brand names.

The group’s farm equipment segment is engaged in the sale of tractors, spare parts and related services. In FY2011, M&M’s farm equipment segment (including Swaraj division) recorded sales of 214,325 tractors and recorded an increase of 22.3% over FY2010 sales. Under this segment, the group markets its vehicles under Arjun, Bhoomiputra, Sarpanch, Shaan, Yuvraj, FengShou, Huanghai Jinma and Swaraj brand names. In addition, in the in the power generation space under the Mahindra Powerol Brand, the group sold 27,748 engines in FY2011.

The group through its Systech segment is engaged in providing automotive components and other related products and services. It provides design and engineering services, CAD and CAE services to the automotive domain, aerospace and general engineering industries. Its products include alloy steel, blankings, castings, composites, ferrites and magnetic products, forgings, gears, ring rolling, and stampings.

M&M’s IT services segment includes services rendered to the technology and telecom industries. It provides a range of services that are focused on the supply chain, including strategy and process consulting, systems implementation and business process outsourcing, to the companies globally.

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M&M’s financial services segment comprise of services relating to financing, leasing and hire purchase of automobiles and tractors. It provides financing for utility vehicles (UVs), tractors and cars in the rural and semi-urban sectors. The group offers direct insurance broking services both in the life and non-life insurance segments with a focus on retail and commercial lines of businesses. The life insurance retail products include children’s plans, endowment, money back, retirement plans, term, unit linked plans and whole-life plans, while the group’s non-life insurance retail products cover personal, industrial, commercial, social and liability plans.

The group’s steel trading and processing segment provides trading and processing of steel services. Its infrastructure segment is engaged in operating commercial complexes, project management and development. The segment offers services related to real estate, special economic zones, infrastructure development, project engineering consultancy and design.

M&M’s hospitality segment includes sale of timeshare, and providing holiday facilities to members for a specified period each year, over a number of years, for which membership fee is collected either in full up front, or on a deferred payment basis.

The group’s other business segment comprises of logistics, after-market, two wheelers, and investment. The after-market sector focuses on the pre-owned vehicles, servicing, spares and the financial instruments and exchange platforms. The business units in the after-market sector include Mahindra Spares Business, Mahindra First Choice Wheels that purchase and sale of pre-owned vehicles, and Mahindra First Choice Services that involves in multi-brand service chain. The group's two wheeler sector is engaged in designing and marketing a range of scooters and motorcycles for the Indian and global markets.

Mahindra & Mahindra, Ltd. Page 6 © Datamonitor Mahindra & Mahindra, Ltd. History

HISTORY

Mahindra & Mahindra (M&M or ‘the group’) was incorporated in 1945 as Mahindra & Mohammed. In 1948, Mahindra & Mohammed was renamed as Mahindra & Mahindra, Ltd. In the following year, the group commenced jeep assembly.

The group established Otis Elevator Company (India) in 1953. In the following year, M&M was technically and financially collaborated with Willys Overland to assemble Jeep-type vehicles.

M&M shares were listed on the Bombay Stock Exchange in 1956. The group's Mahindra Owen was established as a joint venture with Rubery Owen & Company, the UK in 1957. In the following year, the group commenced the operations of machine tools division.

In 1960, M&M entered a joint venture with Bir Field (GKN Group, UK) and established Mahindra Sintered Products. After two years, the group established Mahindra Ugine Steel Company, a joint venture with Ugine Kuhlmann, France. In the following year, International Tractor Company of India was established as a joint venture with International Harvester Company, the US.

M&M established Vickers Sperry of India, a joint venture with Sperry Rand, the US, in 1965. The group's instrumentation and electronics division came into existence in 1968. In the same year, the group also acquired the whole paid-up capital of Mahindra Electro-Chemicals Products Company. International Tractor Company of India merged with M&M to form its tractor division in 1977. Later in 1982, the group established Siro Plast.

In 1984, Mahindra Hellenic Auto Industries was established as a joint venture in Greece to assemble and market utility vehicles in Europe. In the following year, M&M signed a memorandum of understanding (MOU) with British Telecom under which the two companies jointly explored and developed opportunities in telecommunication and technical fields in India.

The group's Tech Mahindra was established as a joint venture with British Telecommunications in the UK in 1986. In the following year, the group acquired International Instruments. In 1989, M&M acquired the automotive pressing unit at Kanhe from Guest Keen Williams.

The group established Mahindra Financial Services, a wholesale fund provider, in 1991. In the following year, M&M merged diverse activities of steel, machine tools and graphics into intertrade division. In 1993, M&M incorporated Mahindra British Telecom International in the US. In the same year, Mahindra Steel Service Centre was established in association with Mitsubishi and Nissho Iwai of Japan. In addition, the group's Mahindra Acres Consulting Engineers was established as a joint venture with Acres International (Canada) to provide multidisciplinary engineering consultancy services. Subsequently, M&M launched Armada range of vehicles.

M&M established Mahindra Realty & Infrastructure Developers and Mahindra USA in 1994. In the same year, the group established EAC Graphics (India) in collaboration with East Asiatic Company,

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Denmark. Additionally, Mahindra Allwyn Nissan was merged with M&M. In the following year, Mahindra Holding & Finance became a subsidiary of M&M to carry out business as an investment company. In the same year, the group entered into technical collaboration with Mitsubishi/Samcor to manufacture the Mitsubishi L300.

In 1996, Mahindra Ford India was established as a joint venture with Ford Motor Company to manufacture passenger cars. In the same year, the group established Mahindra Holidays & Resorts India (MHRIL) and Mahindra Consulting. In the following year, M&M set up an engineering and product development center in India. In the same year, the group set up a joint venture with Mondragon of Spain in the area of iron foundry. In addition, M&M inaugurated the Mahindra United World College of India. Also in 1997, the group established Mahindra World City Developers to set up integrated townships.

The group launched Bijlee, a battery-operated 3-wheeler, in 1999. In the same year, Mahindra Network Services launched online vehicle website in India. In 1999, M&M acquired a major stake in Gujarat Tractors and renamed it as Mahindra Gujarat Tractors. In the same year, Mahindra & Mahindra Financial Services became a subsidiary of M&M. Mahindra Logisoft Business Solutions and Mahindra Intertrade were established in 1999. In the same year, M&M signed an agreement with Plasan Sasa of Israel for the design and development of armored (bullet proof) solutions on the group's utility vehicles designed for use by Indian security forces.

In 2000, M&M and French carmaker Renault signed an agreement to explore the possibility of using Renault petrol engines for M&M's Scorpio SUV vehicle. In the same year, the group established Mahindra Auto Specialities. Further in 2000, M&M set up the satellite tractor plant at Rudrapur and also launched a tractor, Mahindra Arjun 605 DI (60 HP) and Bolero GLX, a utility vehicle.

In 2001, the group launched Mahindra Arjun, a tractor; Champion, a 3-wheeler diesel vehicle; and Mahindra MaXX, a multi-utility vehicle. In the same year, M&M was tied up with Renault for petrol engines. In 2001, the group established Mahindra Special Services Group; Mahindra Infrastructure Developers and Mahindra Lifespace Developers (MLDL). In the following year, M&M launched the Scorpio SUV.

The group launched Invader, a multi purpose convertible SUV; MaXX Pik Up, turbo tractor and Mahindra Sarpanch 595 DI super turbo, in 2003. In the same year, M&M entered into industrial engine business and established Mahindra Engineering Services. Moreover, an alliance was formed between Mahindra Defence and Lockheed Martin Information Systems, the UK, for defense products.

In 2004, Systech (formerly known as MSAT) was established by the group to develop components and provide engineering services. In the same year, the group signed MOU to enter into joint venture with Jiangling Motor Company Group (JMCG) of China, to acquire tractor manufacturing assets from Jiangling Tractor Company, a subsidiary of Jiangling Motor Company Group.

In the following year, the group launched its Australian operations, Mahindra Australia. In the same year, the group and Renault signed a joint venture agreement to produce Logan, developed by Renault in the Indian market. In 2005, M&M signed a joint venture with International Truck & Engine

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to manufacture trucks and buses in India. In the same year, M&M acquired 88% of Plexion Technologies (India), a JP Morgan company.

Further in 2005, the group acquired 51% stake in SAR Transmission, a company engaged in manufacture of gears and transmission shafts. In the same year, M&M acquired 80% stake in the joint venture with Jiangling Motors i.e. in Mahindra (China) Tractor Company. Mahindra Renault, a joint venture with Renault to manufacture and market Logan, a mid-sized sedan, in India and Mahindra International, a joint venture with International Truck and Engine Corporation to manufacture trucks & buses in India, were established in 2005.

M&M acquired Stokes Group, an automotive forging company, in 2006. In the same year, the group acquired, Texas-based Axes Technologies, a telecom solutions provider; DGP Hinoday Industries; Plexion Technologies (India); the Stokes Group, the automotive forgings company in the UK; and Jeco Holding, a forging company of Germany. In the same year, M&M launched, New Scorpio; Scorpio Hybrid; Scorpio and Bolero in Kenya; Scorpio Pik in South Africa; ZEST.

Further in 2006, M&M entered into a joint venture with an American auto major International Truck & Engine to manufacture trucks and buses in India. In the same year, Motorola and Tech Mahindra, the group's subsidiary entered into an agreement, to bring content to the customer through CanvasM. Subsequently, Mahindra Finance and Maruti Udyog, entered into an agreement for rural auto financing.

The group's Tech Mahindra (TechM) partnered with Microsoft's Connected Services Sandbox, in 2007. In the same year, the group signed an agreement for the design and development of the general aviation aircraft between National Aerospace Laboratories, Council of Scientific and Industrial Research, Government of India.

In 2007, the group acquired a 43.3% stake in Punjab Tractors. In the same year, Tech Mahindra and Sun Microsystems India formed a strategic alliance to rollout of IPTV services to the Indian and Asia Pacific markets. During the same year, M&M and its joint venture company, Mahindra Renault, launched its Logan brand sedan in India.

Further in 2007, Tech Mahindra formed a partnership with TAZZ Networks to help service providers accelerate the IP services. In the same year, M&M through its subsidiary, Mahindra Forgings Global based in Mauritius acquired 90.5% stake in Schoneweiss, a Germany based company engaged in the forgings sector.

M&M, through an Italian subsidiary, Mahindra Graphic Research, and Design (MGRD), acquired GR Grafica Ricerca Design (GRD), an Italian auto designing, in 2008. In same year, a consortium of M&M and ICICI Venture Funds Managements signed a definitive agreement agreeing to acquire 100% stake in Metalcastello, an Italian independent gear manufacturer. During the same year, the group formed a new business vertical called after-market sector comprising Mahindra First Choice Services (Multi-brand service chain); Mahindra First Choice (for purchase and sale of pre-owned vehicles); and Mahindra Spares Business (for both Mahindra and non-Mahindra spares) business units.

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The group launched its Mahindra Pik Up Double Cab in Paraguay, in partnership with the Rieder Group in 2008. In the same year, M&M acquired Engines Engineering, a legal entity which was formed transferring the business of Engines Engineering. In the same year, M&M entered into a joint venture with TMI Pacific in Australia. In addition, the group changed Project Ingenio to Mahindra XYLO. In the same year, MHRIL signed a MOU with Kerala Government for promotion of Homestays.

During 2008, M&M acquired majority stake in a tractor company in China. In the same year, Mahindra Renault launched the Logan Edge. Additionally, the group and ICICI Venture consortium signed an agreement to acquire Metalcastello. Subsequently, Mahindra Lifespaces signed MOU to set up a SEZ in Sri Lanka and acquired Italian design house, GRD Italy.

In 2009, MHRIL added Casa Deep Woods, Masinagudi to its chain of Zest resorts. In the same year, M&M launched the Xylo. Also in 2009, MHRIL acquired Casa Deep Woods, Masinagudi (Tamil Nadu). Moreover, State Bank of India signed an agreement with Mahindra World City (Jaipur) to establish its North India hub in the Domestic Tariff Area of Mahindra World City, Jaipur. In the same year, the group signed a MOU with Bank of Baroda for vehicle finance.

During the same year, Mahindra Retail launched its flagship Mom and Me store. In the same year, Tech Mahindra, a subsidiary of the group, acquired a controlling stake in Satyam Computer Services. Additionally, M&M launched Bolero MaxiTruck with Micro Hybrid technology. Furthermore, Tech Mahindra launched an IOT Lab to offer Test Services to Telecom Service Providers (TSPs), Telecom Equipment Manufacturers (TEMs) and Independent Software Vendors (ISVs).

Further in 2009, Mahindra Two Wheelers launched two scooters: Mahindra Rodeo and Mahindra Duro. In the same year, M&M and BAE Systems signed an agreement to create a land systems focused, joint venture defence company, in India. Also in 2009, Mahindra Lifespace Developers (MLDL) launched 'Aqualily', a residential community developed within the Mahindra World City in India. Further, the group entered into two aerospace deals with two Australian companies, Aerostaff Australia and Gippsland Aeronautics.

In 2010, M&M launched the Scorpio Automatic in Egypt, and Maxximo, the mini-truck. In the same year, the group launched. Mahindra Steel Service Centre, a joint venture between Mahindra Intertrade and Metal One of Japan, inaugurated an electrical steel processing plant at Mandideep, Bhopal. Moreover in the same year, M&M and Mitsubishi Agriculture Machinery Company Japan signed a license agreement for the transfer of agricultural machinery technology, to provide mechanization for crop specific solutions.

During 2010, M&M inaugurated its auto manufacturing plant in Chakan in Maharashtra. In the same year, M&M acquired a 55.2% stake in REVA Electric Car and renamed it as Mahindra REVA Electric Vehicle. Furthermore, M&M along with its subsidiary MOICML (Mahindra Overseas Investment Company Mauritius), Arabia Holdings and Ras Al-Khaimah Transport Investments signed an agreement to create a joint venture company in the Emirate of Ras Al Khaimah in the UAE for armoring of vehicles.

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Further in 2010, Mahindra REVA Electric Vehicles launched its new electric vehicle, REVAi in Hyderabad and Delhi. Also in the same year, MLDL signed a joint venture agreement for residential development between its subsidiary company, Mahindra Residential Developers (MRDL) and the private equity real estate fund, ARCH Capital Asian Partners, managed by ARCH Capital Management Company. Subsequently, the group acquired a 70% stake in Ssangyong Motor Company for $463 million. Also M&M introduced its 4X4 off roader the Thar CRDe, in India.

In January 2011, M&M announced an investment of approximately INR1,200 million ($25.3 million) over next three years for building brand position of 'Mahindra Rise' and the new core purpose. Further in the same month, M&M launched the Genio, a 1.2 tonne pick-up vehicle. In addition, M&M signed multifaceted agreement with Sundance Institute to support independent cinema around the world, and Mahindra Navistar launched MN25 & MN31 trucks in Coimbatore and Chennai. Also, in the same month, M&M acquired a minority stake in The East India Company. In the following month, M&M acquired a 38% stake in EPC Industrie.

M&M and Cisco signed a comprehensive MOU in March 2011 to collaborate on go-to-market strategies in areas that include smart cities, virtual dealership, sports and entertainment, and cloud services. Additionally, M&M decided to open new tractor plant in Zaheerabad, Andhra Pradesh with an investment of INR3,000 million ($66.6 million). Further in the same month, M&M launched Gio Compact Cab, a 4-wheeler Compact Cab in Chandigarh.

In April 2011, M&M launched India’s first 15 horse power (HP) tractor, the Yuvraj 215, in Pune, and also launched its sedan the Verito. In the same month, M&M launched its passenger carrier vehicle Maxximo Mini Van in Mumbai. In May 2011, M&M launched the Maxximo mini-truck in Nepal. In the same month, M&M launched its passenger sedan ‘Verito’ in Gujarat and Kerala, and also launched the Scorpio Ex, a new, entry-level offering from Scorpio stable.

M&M launched monsoon challenge 2011 in partnership with Apollo Tires in July 2011. In September 2011, M&M launched the ‘New Bolero’ SUV in Chennai, Patna, and Chandigarh. In the same month, M&M introduced Mahindra Genio range of pick-ups globally to cater to the evolved needs of the small and medium entrepreneurs (SMEs). Also in September 2011, M&M launched the Mahindra XUV500 at Pune in Maharashtra.

In November 2011, M&M entered in to 2012 MotoGP at Valencia MotoGP race. In the same month, M&M and Telephonics Corporation signed a MOU to form a joint venture to provide the Indian Ministry of Defense (MOD) and the Indian civil sector with radar and surveillance systems, Identification Friend or Foe (IFF) devices and communication systems. Subsequently, M&M entered Ecuador market with launch of its vehicles.

M&M launched the new Mahindra Duro DX, a fuel efficient 125 cc scooter in December 2011.

In January 2012, M&M introduced Mahindra XUV5OO at Ahmedabad, Chandigarh, Hyderabad, and Cochin. In February 2012, M&M launched its new XYLO.

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KEY EMPLOYEES

Name Job Title Board Compensation

Anand G. Mahindra Vice Chairman and Managing Executive Board 32940000 INR Director Bharat Narotam Doshi Executive Director and Group Chief Executive Board 22720000 INR Financial Officer Keshub Mahindra Chairman Non Executive Board Deepak S. Parekh Director Non Executive Board Arun K. Nanda Director Non Executive Board Nadir B. Godrej Director Non Executive Board M. M. Murugappan Director Non Executive Board Narayanan Vaghul Director Non Executive Board A. S. Ganguly Director Non Executive Board R. K. Kulkarni Director Non Executive Board Anupam Puri Director Non Executive Board Arun Kanti Dasgupta Director Non Executive Board Pawan Goenka President, Automotive and Farm Senior Management Equipment Sectors Hemant Luthra President, Systech Senior Management Anoop Mathur President, Two-Wheeler Senior Management Rajeev Dubey President, Group HR and Senior Management After-Market Uday Y. Phadke President, Finance, Legal and Senior Management Financial Services Ulhas N.Yargop President, Information Technology Senior Management Sector; and Group Chief Technology Officer Anita Arjundas Managing Director, Mahindra Senior Management Lifespace Developers; and Chief Operating Officer, Real Estate Zhooben Bhiwandiwala Executive Vice President and Senior Management Managing Partner, Mahindra Partners C.P. Gurnani Chief Executive Officer, Mahindra Senior Management Satyam Ruzbeh Irani Chief Executive Officer, International Senior Management Operations, Automotive and Farm Equipment

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Name Job Title Board Compensation

Ramesh Iyer Managing Director, M&M Financial Senior Management Services Rajesh Jejurikar Chief Executive Officer, Automotive Senior Management Division Harsh Kumar Managing Director, Mahindra Senior Management Intertrade Romesh Kaul Global Chief Executive Officer, Senior Management Gears Business, Systech Bishwambhar Mishra Chief Executive Officer, Tractor and Senior Management Farm Mechanization V. S. Parthasarathy Group Chief Information Officer, and Senior Management Executive Vice President, Finance and Mergers and Acquisitions Pravin Shah Chief Executive Officer, International Senior Management Operations Rajan Wadhera Chief Executive Officer, Technology, Senior Management Product Development and Sourcing Shriprakash Shukla President, Special Group Projects Senior Management Rajiv Sawhney Chief Executive Officer, Mahindra Senior Management Holidays and Resorts India

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KEY EMPLOYEE BIOGRAPHIES

Anand G. Mahindra

Board: Executive Board Job Title: Vice Chairman and Managing Director Since: 2003

Mr. Mahindra has been the Vice Chairman and Managing Director at Mahindra & Mahindra since 2003. He was appointed as the Managing Director at the group in 1997. Prior to this, Mr. Mahindra served as the Deputy Managing Director at M&M. He also rendered his service to the group as the President and Deputy Managing Director in 1989. Mr. Mahindra joined M&M in 1981 as an Executive Assistant to the Finance Director at Mahindra Ugine Steel.

Bharat Narotam Doshi

Board: Executive Board Job Title: Executive Director and Group Chief Financial Officer Since: 2007

Mr. Doshi has been the Executive Director and Group Chief Financial Officer at Mahindra & Mahindra since 2007. He is also the Chairman at Mahindra & Mahindra Financial Services and Mahindra Intertrade. In addition, he is also rendering services as a Director of several companies in the Mahindra Group. Prior to this, he was the President of the trade and financial services sector from 1994 to 2007. Moreover, Mr. Bharat served as the Executive Vice President of Corporate Affairs at M&M from 1991 to 1992, when he joined the Board of the group as an Executive Director in charge of Finance and Accounts, Corporate Affairs, and Information Technology. Initially, Mr. Bharat joined the group in 1973 as an Executive. Bharat is the Chairman at Mahindra & Mahindra Financial Services and Mahindra Intertrade. He is also a Director of several companies in the Mahindra Group.

Keshub Mahindra

Board: Non Executive Board Job Title: Chairman Since: 1963

Mr. Mahindra has been the Chairman at Mahindra & Mahindra since 1963. He is the founder of the group. He joined M&M in 1947 and became the Chairman in 1963. Over the years, Mr. Mahindra has been a member of organizations and committees including Prime Minister’s Council on Trade and Industry, Employers’ Federation of India (President Emeritus), Centre for Research in Rural and Industrial Development Society (Chairman). He also worked as the President at Bombay Chamber of Commerce and Industry (1966–67), President at Indo-American Society (1991–92), and Chairman

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at India Nominating Committee “Single Nation Programme” – Eisenhower Exchange Fellowships, the US (1998–2005).

Deepak S. Parekh

Board: Non Executive Board Job Title: Director Since: 1990

Mr. Parekh has been a Non Executive Director at Mahindra & Mahindra since 1990. He is also the Chairman at Housing Development Finance Corporation (HDFC). In addition, he also serves as a Non Executive Chairman at several companies including GlaxoSmithKline Pharmaceuticals, Infrastructure Development Finance Company (IDFC), Lafarge India and Siemens India. Prior to HDFC, Mr. Parekh worked with Grindlays Bank and Chase Manhattan Bank for a year each. He joined HDFC in 1978 and became the Executive Chairmanship at HDFC. Initially, Mr. Parekh began his career with Ernst & Young Management Consultancy Services in New York City, the US.

Arun K. Nanda

Board: Non Executive Board Job Title: Director Since: 1992

Mr. Nanda has been a Non Executive Director at Mahindra & Mahindra since 1992. He is the Founder, Director, and Chairman at Mahindra Holidays & Resorts India (MHRIL). Mr. Nanda is also the Chairman at Confederation of Indian Industry (CII) Western Region, Chairman Emeritus at Indo-French Chamber of Commerce, member of the governing Boards of the council at EU Chambers of Commerce in India and Bombay First. He also served as the Chairman at CII National Committee on Water from 2007 to 2009.

Nadir B. Godrej

Board: Non Executive Board Job Title: Director Since: 1992

Mr. Godrej has been a Non Executive Director at Mahindra & Mahindra since 1992. He is currently the Managing Director at Godrej Industries, and President at Alliance Francaise de Bombay. Mr. Godrej also serves on the Boards of several companies including Tata Teleservices (Maharashtra), Indian Hotels Company, and several Godrej Group companies.

M. M. Murugappan

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Board: Non Executive Board Job Title: Director Since: 1992

Mr. Murugappan has been a Non Executive Director at Mahindra & Mahindra since 1992. He is currently the Chairman at Carborundum Universal, Tube Investments of India, and Wendt India. He is a member of the Supervisory Board at Murugappa Group. In addition, Mr. Murugappan also serves on the Board of Governors at Indian Institute of Technology (IIT), Madras.

Narayanan Vaghul

Board: Non Executive Board Job Title: Director Since: 1996

Mr. Vaghul has been a Non Executive Director at Mahindra & Mahindra since 1996. He is currently serving as the Chairman of the Board at ICICI Bank. Previously, Mr. Vaghul has also served as the Chief Executive Officer at ICICI Bank and on the Boards of Directors of both the Central Bank of India and the Bank of India. He worked as the Chairman and member of several committees and task forces created by the Government and the Reserve Bank of India over the years. In addition, Mr. Vaghul worked on several assignments for the Asian Development Bank, the IFC and the World Bank and briefly served as the Chairman at Government's Foreign Investment Advisory Board.

A. S. Ganguly

Board: Non Executive Board Job Title: Director Since: 1997

Mr. Ganguly has been a Non Executive Director at Mahindra & Mahindra since 1997. He is currently working as the Chairman of Firstchoice Solutions and the media house ABP Pvt Ltd. He is also a Member of Parliament. Over the course of his career, Mr. Ganguly held senior positions with Hindustan Lever, ICI India, British Airways, Wipro, Tata AIG Life Insurance Co, Hemogenomics, and Firstsource Solutions. Mr. Ganguly also advises the Microsoft Corporation’s operations in India, the Blackstone Group, and Dr. Reddy’s Laboratories. In addition, Mr. Ganguly served on several government committees, including the Science Advisory Committee to the Prime Minister, the Investment Commission, and the National Knowledge Commission to the Prime Minister, among others.

R. K. Kulkarni

Board: Non Executive Board Job Title: Director Since: 1997

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Mr. Kulkarni has been a Non Executive Director at Mahindra & Mahindra since 1997. Since 2005, he has been a Senior Partner at the legal firm Khaitan & Co, Mumbai. Mr. Kulkarni works as a member at the Bar Council of Maharashtra and Goa and the Bombay Incorporated Law Society. He is also a member of both the faculty and the Advisory Committee for the Security Law course offered by the Government Law College, Mumbai.

Anupam Puri

Board: Non Executive Board Job Title: Director Since: 2001

Mr. Puri has been a Non Executive Director at Mahindra & Mahindra since 2001. He is also a Director at Tech Mahindra and Dr. Reddy’s Laboratories and on the advisory boards at Spencer Stuart and Corsair Capital, a private equity firm. Mr. Puri is currently serving as a Special Adviser for General Atlantic Partners.

Arun Kanti Dasgupta

Board: Non Executive Board Job Title: Director Since: 2008

Mr. Dasgupta has been a Non Executive Director at Mahindra & Mahindra since 2008. He is currently works as the Managing Director at Life Insurance Corporation of India (LIC). Mr. Dasgupta joined LIC in 1977 as a Probationary Officer at a zonal office in Mumbai, and became Managing Director in 2007.

Pawan Goenka

Board: Senior Management Job Title: President, Automotive and Farm Equipment Sectors Since: 2010

Mr. Goenka has been the President of the Automotive and Farm Equipment Sectors division at Mahindra & Mahindra since 2010. Currently, he is also serving as the President at SIAM (Society of Indian Automobile Manufacturers). In 2005, Mr. Goenka was appointed as President, and in 2003 he was appointed as the Chief Operating Officer of the automotive sector at M&M. Prior to M&M, Mr. Pawan spent 14 years with General Motors (GM) in Detroit, the US.

Hemant Luthra

Board: Senior Management

Mahindra & Mahindra, Ltd. Page 17 © Datamonitor Mahindra & Mahindra, Ltd. Key Employee Biographies

Job Title: President, Systech Since: 2004

Mr. Luthra has been the President of Systech at Mahindra & Mahindra since 2004. He also serves as Director and Chairman of several Mahindra Group companies. He joined M&M in 2001 as Executive Vice President of Corporate Strategy. He began his career with IBM and worked in their Indian and Singapore offices. He spent 18 years with the Thapar Group, a $1 billion conglomerate with interests in paper, chemicals, and engineering, as the Chief Financial Officer and later as the Chief Operating Officer. He later founded a Private Equity fund for the ING Group. Afterwards, he joined the Essar Group as the Chief Executive Officer of their telecom business. Mr. Luthra then worked with Enron India as the Chief Executive Officer of their broadband business.

Anoop Mathur

Board: Senior Management Job Title: President, Two-Wheeler Since: 2007

Mr. Mathur has been the President of Two-Wheeler Sector at Mahindra & Mahindra since 2007. He serves on the Boards at Mahindra Two-Wheelers, Mahindra Shubhlabh Services, Bristlecone, the US; and Mahindra China Tractor Company. In addition, he also serves as a member of the remuneration committee at Bristlecone. Mr. Mathur joined M&M in 2007 as the Senior Advisor to the Vice Chairman and Managing Director. He began his career as a management trainee with Hindustan Lever (HLL) now Hindustan Unilever (HUL) and worked his way up to hold key positions including Executive Director of Technology and Exports. Prior to that, Mr. Mathur was the Technical Director at Unilever, South Africa. His other assignments included Executive Chairman and Chief executive Officer at Hind Lever Chemicals and Executive Director of Chemicals, Agri and Specialties at HLL.

Rajeev Dubey

Board: Senior Management Job Title: President, Group HR and After-Market Since: 2004

Mr. Dubey has been the President of HR and After-Market at Mahindra & Mahindra since 2004. He is also on the Boards of several group companies including Mahindra China Tractor, Mahindra Intertrade, Mahindra First Choice Wheels, Mahindra Insurance Brokers and Mahindra Retail. In addition, Mr. Dubey is the Chairman at Mahindra First Choice Services. Moreover, Mr. Dubey also serves on the CII National Committee of Indian MNCs, the CII Apex Council on Affirmative Action and the CII Western Regional Council. Mr. Dubey is a member of the National Board at NHRDN, the Chairperson at Employer’s Federation of India (EFI) Western Region, and serves on the Boards at Lal Bahadur Shastri Institute of Management and Technology (LBSIMT) and the School of Inspired Leadership (SOIL). Subsequently, he also serves as the Chairman at Sustainability and CSR Councils

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of the group. Mr. Dubey is working as a member of the Governing Council at Mahindra Institute of Quality and the Corporate Governance Cell. Prior to the joining M&M in 2004, Mr. Dubey aliened Tata Group in 1975 and worked for 29 years. He spent 21 years with Tata Steel, and the next 7 years as the Managing Director and Chief Executive Officer at Tata Metaliks and then at Rallis India.

Ulhas N.Yargop

Board: Senior Management Job Title: President, Information Technology Sector; and Group Chief Technology Officer Since: 2010

Mr.Yargop has been the President of Information Technology; and the Group Chief Technology Officer at Mahindra & Mahindra since 2010. Mr.Yargop joined the group in 1992 as the General Manager of Corporate Planning. He is a member of the managing committee at HBS Research Centre, on the Board of Governors at Mahindra United World College of India, and a trustee at K.C. Mahindra Education Trust and Mahindra Foundation. Initially, Mr.Yargop worked at GKN Automotive USA as a Director of Finance. He contributed his service at GKN Invel Transmissions, India as the General Manager of Commercial.

Anita Arjundas

Board: Senior Management Job Title: Managing Director, Mahindra Lifespace Developers; and Chief Operating Officer, Real Estate Since: 2009

Ms. Arjundas has been the Managing Director of Mahindra Lifespace Developers (MLD) and the Chief Operating Officer of Real Estate at Mahindra & Mahindra since 2009. In addition, Ms. Arjundas works as a member at Federation of Indian Chambers of Commerce and Industry (FICCI) Real Estate Council, Asia Society, and the Developer’s Committee of the Export Promotion Council for Export-Oriented Units and Special Economic Zones (EPCES). Ms. Arjundas joined M&M in 2002. Prior to joining the group, she spent ten years with the Murugappa Group in the fast-moving consumer goods (FMCG) space and three years in the IT industry in international marketing.

Zhooben Bhiwandiwala

Board: Senior Management Job Title: Executive Vice President and Managing Partner, Mahindra Partners Since: 1985

Mr. Bhiwandiwala has been the Executive Vice President and Managing Partner, Mahindra Partners at Mahindra & Mahindra since 1985. He has been with the group sin the past 26 years. Apart from overseeing the group’s legal division, Mr. Bhiwandiwala also manages Mahindra Partners, a diversified division that oversees new businesses within the group. Prior to his role with Mahindra Partners,

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Mr. Bhiwandiwala served as the Senior Vice President of Corporate Affairs at M&M. He spent two years with S.B. Billimoria & Co, Chartered Accountants before joining M&M.

C.P. Gurnani

Board: Senior Management Job Title: Chief Executive Officer, Mahindra Satyam

Mr. Gurnani is the Chief Executive Officer of Mahindra Satyam at Mahindra & Mahindra. Prior to this, he headed Tech Mahindra’s global operations, sales, and marketing functions. Mr. Gurnani held several leading positions with companies like Hewlett Packard, Perot Systems and HCL.

Ruzbeh Irani

Board: Senior Management Job Title: Chief Executive Officer, International Operations, Automotive and Farm Equipment Since: 2012

Mr. Irani has been the Chief Executive Officer of International Operations for Automotive and Farm Equipment at Mahindra & Mahindra since February 2012. Previously, he served as the Executive Vice President of Corporate Strategy and the Chief Brand Officer at M&M from 2009 to 2012. Mr. Irani joined the Mahindra Group in 2007 as the Executive Vice President of Corporate Strategy. Before joining M&M, Mr. Irani spent close to 22 years with Hindustan Unilever and Unilever. He joined Hindustan Unilever as a Management Trainee in 1985 and held a number of positions with the group, including Brand Manager for Surf and Regional Manager for Western India. Mr. Irani also worked with Unilever Central Asia (as Marketing Manager – Home and Personal Care), Unilever Africa Regional Group (as Vice President Customer Development) and Unilever Maghreb (as a member of the Board of Directors heading the customer development function for the Maghreb Region).

Mahindra & Mahindra, Ltd. Page 20 © Datamonitor Mahindra & Mahindra, Ltd. Major Products and Services

MAJOR PRODUCTS AND SERVICES

Mahindra & Mahindra (M&M or ‘the group’) is a flagship company of the Mahindra Group, which through its subsidiaries, is primarily engaged in manufacturing and marketing of a range of utility vehicles. The group’s key products, services, and brands include the following:

Products:

Utility vehicles Commercial vehicles Pickups Automotive components Spare parts Scooters Motorcycles Mopeds Electric two-wheelers Electric cars

Services:

IT (Information Technology) and telecom services Financial services Infrastructure development services Hospitality services Logistics services Computer-aided engineering (CAE) services Project management services

Brands:

Actyon Actyon Sports Alfa Arjun Bhoomiputra Bolero Chairman W FengShou Genio Gio Huanghai Jinma Korando Kyron

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Loadking Logan Maxximo REVA Electric Cars Rexton II Rodius Sarpanch Scorpio Shaan Swaraj Thar Verito XUV 500 Xylo Yuvraj

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REVENUE ANALYSIS

Mahindra & Mahindra, Ltd.

The group recorded revenues of INR323, 899.9 million ($7,061 million) in FY2011, an increase of 28% over FY2010. For FY2011, domestic, the group’s largest geographic market, accounted for 90.1% of the total revenues.

M&M generates revenues through nine business segments: automotive (40.4% of the total revenues in FY2011), farm equipment (29.4%), systech (9.4%), IT services (7%), financial services (5.6%), steel trading and processing (1.9%), infrastructure (1.7%), hospitality (1.4%), and others (3.2%).

Revenue by segment*

In FY2011, the automotive segment recorded revenues of INR148,929.5 million ($3,246.7 million), an increase of 32.1% over FY2010.

The farm equipment segment recorded revenues of INR108,411.3 million ($2,363.4 million) in FY2011, an increase of 20.5% over FY2010.

The systech segment recorded revenues of INR34,738.1 million ($757.3 million) in FY2011, an increase of 36.4% over FY2010.

The IT services segment posted revenues of INR25,751.7 million ($561.4 million) in FY2011, a decrease of 46.6% compared to FY2010.

The financial services segment recorded revenues of INR20,559.6 million ($448.2 million) in FY2011, an increase of 30.9% over FY2010.

The steel trading and processing segment recorded revenues of INR6,860.6 million ($149.6 million) in FY2011, an increase of 16.3% over FY2010.

The infrastructure segment recorded revenues of INR6,096.5 million ($132.9 million) in FY2011, an increase of 46.9% over FY2010.

The hospitality segment recorded revenues of INR4,996.3 million ($108.9 million) in FY2011, an increase of 0% over FY2010.

The others segment recorded revenues of INR12,128.9 million ($264.4 million) in FY2011, an increase of 38.6% over FY2010.

*As reported by the company in its annual filing. Percentages are rounded off.

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Revenue by geography**

Domestic, M&M’s largest geographical market, accounted for 90.1% of the total revenues in FY2011. Revenues from domestic reached INR356,339.7 million ($7,768.2 million) in 2011, an increase of 18.5% over FY2010.

Overseas geographical segment accounted for 9.9% of the total revenues in FY2011. Revenues from overseas reached INR38,955.7 million ($849.2 million) in 2011, an increase of 7.9% over FY2010.

** As reported by the company in its annual filing. Percentages are rounded off.

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SWOT ANALYSIS

Mahindra & Mahindra (M&M or ‘the group’) is a flagship company of the Mahindra Group, which through its subsidiaries, is primarily engaged in manufacturing and marketing of a range of utility vehicles. It also provides farm equipment, steel trading and processing, financial, infrastructure development, hospitality, information technology services. The group is well diversified in terms of business lines. Diversified business operations not only allow the group to leverage its financial risk in the adverse situations but also expand its financial and geographical strength. However, increasing competition would adversely impact the group’s market share and profitability.

Strengths Weaknesses

Diversified operations Relatively weak performance in overseas Highest level of credit ratings gain the market investors’ confidence Legal proceedings could tarnish the group’s Leading market position enhances the reputation competitive edge

Opportunities Threats

Strategic business transactions Increasing competition Key collaboration in defense sector Environment and tax regulations Growing automotive market in India Increasing interest rates Significant growth in the Indian IT sector Rising raw material prices

Strengths

Diversified operations

It is difficult task for a group to survive in the highly competitive market with a single source of operation. In order to survive in the competitive market, it is essential to expand its business operations through entering into the different business segments. M&M, along with its 110 subsidiaries, 6 joint ventures and 13 associates, is well diversified in terms of business. The group operates its business through nine reportable segments: automotive, farm equipment, systech, IT (information technology) services, financial services, steel trading and processing, hospitality, infrastructure and others. In FY 2011, the group earned 40.4% of the total revenues from automotive, 29.4% from farm equipment, 9.4% from systech, 7% from IT services, 5.6% revenues from financial services, 1.9% from steel trading and processing, 1.4% from hospitality, 1.7% from infrastructure, and 3.3% revenues from and others segment. Thus, the diversified operations not only provide M&M with an opportunity to leverage its financial risk in the adverse situations but also expand its financial and geographical strength.

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Highest level of credit ratings gain the investors’ confidence

M&M has been rated highest level of ratings by credit rating agenesis including CRISIL, ICRA and Credit Analysis & Research (CARE). During FY2011, the group was re-affirmed the highest level rating “GVC Level 1” by CRISIL, for the fifth year in a row, for its governance and value creation. CRISIL upgraded the group’s rating for long term banking facilities to “AA+/Stable” from the earlier “AA/ Stable”.The group has also been rated by ICRA and CARE for its banking facilities under Basel II norms. ICRA and CARE have maintained a long term rating of “LAA+/Stable” and “CARE AA+” respectively. As M&M has very strong ethical governance practices, this rating indicates the group’s capability with respect to wealth creation for all its stakeholders while adopting strong corporate governance practices is the highest.

Thus, gaining the highest level of credit rating in successive years proves the M&M’s ability of governing, while adhering to the corporate polices, and also provides its investors and stakeholders with a great leverage for their holdings in the group.

Leading market position enhances the competitive edge

M&M has leading market position in various automotive segments. In the tractor industry, the group is widely regarded as the world’s leading tractor manufacturing group. In FY2011, It sold 214,325 tractors under Mahindra and Swaraj brands, against 175,196 tractors in FY2010, an increase of 22%.The group sold 202,513 tractors in the domestic tractor market in FY2011, a significant milestone for a tractor manufacturer anywhere in the world. The group exported 11,812 tractors in FY 2011, as compared to 8,837 tractors exported in FY2010, an increase of 34%. In addition, the group’s US subsidiary Mahindra USA posted a strong 54% growth in tractor sales, significantly higher than the participating industry, gaining market share. This growth was led due to launching of compact and cabin tractor models in FY2011 in this market. As a result of this, the group’s market share increased to 42% in farm equipment sector in Indian tractor market in FY2011 compared to 41.4% in FY2010,

In the multi-utility vehicles (MUV) segment, the group’s sales volume grew by 7.5% in FY2011 and M&M continued its leadership of the domestic MUV market by posting a market share of 60.9%. All products of the group’s passenger MUV portfolio performed very well. For example, Bolero volumes grew by 17.8% over the previous year and Bolero is currently India’s largest selling MUV for five consecutive years. Scorpio and Xylo volumes also posted an impressive growth of 19.1% and 14.6% respectively.

Moreover, the group is the second largest player in the light commercial vehicles (LCV) segment in India with a market share of nearly 32.5%. In addition, in the less than 3.5T LCV segment, M&M has 38% market share in India. Further, M&M maintains 52.2% market share in the domestic utility vehicles segment. Additionally, in the small 4-wheeler cargo segment (0.75 Ton) segment, M&M maintains 19.1% market share in India. In overseas, the group has more than 20% market share in Sri Lanka.

Thus, a strong market position enables the group to maintain an edge over its competitors and also helps the group &M to focus on new inventions and launchings in automotive sector.

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Weaknesses

Relatively weak performance in overseas market

M&M’s overseas market segment has been very weak comparing to domestic market segment. The group’s overseas segment includes sales and services rendered to customers located outside India. M&M’s overseas market segment accounted for mere 9.9% of the total revenues in FY2011, comparatively very low performance from the domestic market, which accounts for 90.1% of the total revenues in FY2011. By contrast, competitor like Tata Motors has more diversified revenue base.This clearly shows M&M’s over dependence on the domestic market. Furthermore, concentration of operations in the domestic market increases the group’s exposure to country specific factors such as labor strikes, changes in economic conditions, and most importantly, increasing competition from other players in the market. Hence, this weak presence in the overseas market could make M&M uncompetitive against its rivals who have globally diversified operations.

Legal proceedings could tarnish the group’s reputation

M&M is subject to various lawsuits, claims, investigations and proceedings during its ordinary course of business. For example, in December 2010, the company’s Mahindra Reva Electric Vehicle was sued by its partner Bannon Automotive, New York seeking $290 million in financial damages on alleged failure in adhering to an agreement inked between Bannon and Reva. As result of this, M&M's plans to launch the electric car Reva in the US faced delays.

Similarly in February 2011, the company’s Mahindra Satyam, settled US lawsuit by paying $125 million. Recently, in May 2011, certain dealers in the US filed suit in US District Court in St. Louis, alleging breach of contract by both M&M and its independent US distributor, Global Vehicles U.S.A. The suit was filed for a refund and for punitive damages. Such lawsuits and legal proceedings would not only have negative impact on the group’s reputation, but also results in additional costs which impacts its profitability.

Opportunities

Strategic business transactions

M&M made many significant business transactions and alliances across the world in FY2011 to expand its geographical reach. For instance, at the end of FY2010, M&M acquired 70% stake in Ssangyong Motor Company (SYMC), a Korean premier manufacturer of sports utility vehicles and recreational vehicles, for approximately $463 million. SYMC has a strong domestic network of over 130 dealers and exports its vehicles to over 90 countries through more than 1,200 dealers. This acquisition helped the group to emerge as a competitive global utility vehicle player by leveraging on its competence in sourcing and marketing strategy.

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In addition, keeping the opportunities in agricultural sector in mind, M&M acquired 38% stake of EPC Industrie, a company engaged in micro irrigation sector, in February 2011. Through this acquisition, M&M entered into micro irrigation business. As the group already has a strong presence in the tractor and farm machinery business, the current entry in the micro irrigation business enables M&M to serve farmers more efficiently and create a strong differentiation for the brand “Mahindra”. Concurrently, in June 2010, M&M, through its wholly-owned subsidiary Mahindra Overseas Investment Company (Mauritius), formed a joint venture company Mahindra Emirates Vehicle Armouring FZ, with Arabia Holdings and Ras-Al-Khaimah Transport Investments in the UAE for armoring of vehicles. M&M holds a 51% stake in the joint venture company, which would design and develop ballistic kits for vehicle protection. This strategic partnership assists M&M in order to address the large and growing market for uparmored vehicles globally especially in West Asia, Central Asia and Africa.

Hence, the strategic acquisitions and alliances such as these would not only allow the group to expand its geographical presence, but also provide with the opportunities of entering into the new business markets to reach across various segments and geographies.

Key collaboration in defense sector

M&M is planning to expand its defense operation in India. In this regard, in November 2011, the group signed an MOU with Telephonics Corporation to form a joint venture (JV), to provide the Indian Ministry of Defence (MOD) and the Indian civil sector with radar and surveillance systems, Identification Friend or Foe (IFF) devices and communication systems. Telephonics is a US-based provider of integrated information and communication systems technology services. The JV which will be established in India would manufacture and service airborne radar systems to support airborne maritime surveillance systems for the Indian Navy and Coast Guard. The JV will license technology from Telephonics for use on a wide range of products that have both defense and civil applications.

M&M is one of the largest private sector suppliers of armored vehicles to the government of the India. The group, through its division Mahindra Defence Systems, is engaged in defense sector in India. The group currently manufactures Sea Mines, Torpedo Launchers, Decoy Launchers and Composites for various naval and other applications from its plant based in Chinchwadgaon, Punem, India.

Hence, this collaboration broadens the road for M&M to achieve its long term goal of becoming the largest private sector defense products supplier to the government of India.

Growing automotive market in India

The outlook of the automotive industry in India remains positive. It is primarily due to the higher disposable incomes and easier vehicle financing options available in the country. India is the seventh largest auto market in the world. Indian automobile industry registered a robust growth during FY 2011 due to the slew of new product introductions by vehicle manufacturers, and growing consumer confidence. The passenger car segment, truck and bus, commercial vehicle, two-wheeler, three-wheeler and the tractor, almost all of these segments are showing exponential growth for two years in a row.

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The passenger vehicle segment grew by 29% with domestic sales crossing 2.5 million vehicles, while the passenger car segment grew by 30%, in line with the overall industry, the multipurpose vehicle (MPV) segment grew by 42%. The utility vehicle (UV) segment registered a growth of 19%. The commercial vehicle (CV) segment grew by 27%, driven by a 32% growth in the medium and heavy commercial vehicle (M&HCV) segment and a 23% growth in the light commercial vehicle (LCV) segment. The three-wheeler segment registered a 19% growth, while two-wheeler segment grew by 25.8%.Within two-wheelers, motorcycles grew by 22.9% and scooters recorded an impressive growth of 41.8%. Mopeds grew at 23.5% in FY2011. Major global players like General Motors, Ford, Mercedes-Benz, Volkswagen, Suzuki, Honda, Fiat, Hyundai, Porsche, Audi and others are active in the country’s automotive industry.

M&M is also a well established player across all the segments of automotive market in India. In FY2011, the group had a market share of 60.9% in the Indian MUV segment; 42% in the tractor industry; and 52.2% in the UV sub-segment. Further, M&M is the second largest player in the LCV segment with a market share of nearly 32.5%. Hence, the rapidly growing Indian automobile market would provide M&M with an opportunity to leverage its strong position in the country.

Significant growth in the Indian IT sector

India is a preferred destination for companies looking to offshore their IT and back-office functions. It also retains its low-cost advantage and is a financially attractive location when viewed in combination with the business environment it offers and the availability of skilled people. According to National Association of Software and Service Companies (NASSCOM), the Indian IT sector recorded revenues of approximately $76 billion in FY2011 growing more than 19% over FY2010. The export revenues recorded approximately $59 billion in FY2011 and contributed 26% as its share in total Indian exports (merchandise plus services). In addition, NASSCOM also expects the sector to grow to more than $225 billion by 2020.

The IT-BPO sector has become one of the most significant growth catalysts for the Indian economy. In addition to fuelling India’s economy, this industry is also positively influencing the lives of its people through an active direct and indirect contribution to various socio-economic parameters such as employment, standard of living and diversity. M&M various IT services to the technology and telecom industries through its IT services segment. It provides a range of services that are focused on the supply chain, including strategy and process consulting, systems implementation and business process outsourcing, to the companies globally. Hence, a growing demand for IT services in India would increase the demand for the groups’ IT services. Thus, the group can leverage the growth and enhance its revenue base.

Threats

Increasing competition

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The global automotive industry is intensely competitive and competition is likely to further intensify in light of continuing globalization and consolidation in the worldwide automotive industry. The competitive factors include product quality and features, innovation and product development time, ability to control costs, pricing, reliability, safety, fuel economy, customer service, and financing terms. M&M faces intense competition from its domestic as well as foreign competitors including Tata Motors, General Motors, Honda Motor, Maruti Udyog, Mitsubishi Motors, Fiat, and Ford, among others. Competition is expected to intensify further as Indian automotive manufacturers obtain greater access to debt and equity financing in the international capital markets or gain access to more advanced technology through alliances.

Additionally, in recent years, the Government of India has permitted automatic approvals for foreign equity ownership of up to 100% in entities manufacturing vehicles and components in India. With the gradual liberalization of the automobile sector, the number of manufacturing facilities in India has grown progressively. Furthermore, Chrysler, Kia, Peugeot, Triumph and Scania are contemplating on foraying into India. These changes have led to noticeably increased competition in product offerings by all the auto manufacturers in India. Increasing competition could adversely impact M&M’s market share and profitability.

Environment and tax regulations

As part of the Bharat Stage (BS) IV carbon emission norms, stringent regulatory norms are being introduced to safeguard the environment, especially in the area of emissions. M&M, as an automobile group, is subjected to extensive governmental regulations regarding vehicle emission levels, noise, safety, and levels of pollutants generated by its production facilities. These regulations are likely to become more stringent and compliance costs may significantly impact the group’s future results of operations. In particular, the US and Europe have stringent regulations relating to vehicular emissions. The proposed tightening of vehicle emissions regulations by the European Union will require significant costs for compliance. During FY2011, the government of India introduced Bharat Stage (BS) IV emission norms for 13 major cities and BSIII norms for the rest of the country for passenger vehicles. In addition, there is a large differential in taxes levied on small cars and larger vehicles in Indian automobile market. With the resulting lower price tag for small cars, many customers may opt to postpone large car purchases or buy a small car.

While M&M is pursuing various technologies in order to meet the required standards in the various countries in which it sells its vehicles, the costs for compliance with these required standards can be significant to the group's operations and may adversely impact M&M’s results of operations.

Increasing interest rates

The bank interest rates in India have been consistently growing from the past few years.The interest rate decisions are taken by the Reserve Bank of India's Central Board of Directors. From 2000 to 2010, India's average interest rate was 5.8% reaching an historical high of 14.5% in August 2000 and a record low of 3.3% in April 2009. In addition, the interest rates in 2011 increased from 5.5% in January 2011 to 7.5% in December 2011. Increasing interest rates tends to influence the consumers’ decision making in buying vehicles as they tend to purchase vehicles at lower interest

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rates. Hence, a consistent increase in the bank interest rates in India would influence the growth in Indian automobile sales which in turn impacts the group’s vehicle sales.

Rising raw material prices

Principal materials and components that M&M uses in manufacturing its vehicles include rolled steel, aluminum, glass, plastic and other resin materials. The group’s financial results could be influenced by the availability and changes in prices of these materials.

The prices of the raw materials witnessed significant increase in the recent years which impacted the group’s profitability. For instance, the cold rolled coil steel price increased by 9.7% to reach INR38,485 ($838.9) in October 2011, compared to INR35,090 ($765) in October 2010. Similarly, the hot rolled coil steel price in India increased from INR31,925 ($696) in October 2010 to INR32,545 ($709.5) in October 2011.The prices are expected to further increase in 2012. Additionally, increased worldwide demand for steel has caused the availability of steel to be a concern. Hence, significant shortages of these materials or price increases could increase M&M’s operating costs and adversely impact the competitive positions of its products which would directly impact the group’s results of operations.

Mahindra & Mahindra, Ltd. Page 31 © Datamonitor Mahindra & Mahindra, Ltd. Top Competitors

TOP COMPETITORS

The following companies are the major competitors of Mahindra & Mahindra, Ltd.

Bajaj Auto Limited Escorts Limited Ashok Leyland Tata Motors Limited Maruti Suzuki India Limited CEAT Ltd. Fiat S.p.A. Ford Motor Company General Motors Company Honda Motor Co., Ltd. Nissan Motor Co., Ltd. Toyota Motor Corporation Volkswagen AG Force Motors Limited Hindustan Motors Limited

Mahindra & Mahindra, Ltd. Page 32 © Datamonitor Mahindra & Mahindra, Ltd. Company View

COMPANY VIEW

A statement by Keshub Mahindra, Chairman of the Board at Mahindra and Mahindra, Ltd. is given below. The statement has been taken from the group’s 2011 annual report.

Dear Shareholders

Your Directors present their Report together with the audited accounts of your Company for the year ended 31st March, 2011.

India’s economic performance in the Financial Year 2011 had both positive and negative elements to it. The economy grew a very creditable 8.5% backed by strong growth in all three Sectors - Agriculture, Industry and Services. However, despite significant monetary tightening by the Reserve Bank of India, inflationary pressures persisted throughout the year, drawing attention to the factors and policies that continue to constrain productive capacities in the economy.

Yields in the Agricultural Sector in India, for instance, are significantly lower than those in other countries, for a wide range of crops. Recognizing the criticality of ensuring food security, at affordable prices for all, the Government of India has taken a series of initiatives focused on enhancing the productive capacities of both farms and farmers. Mahindra Samriddhi, an initiative of the Farm Division of your Company, is making a small but significant contribution in this regard.

Financial Performance

In these challenging times, the Automotive and Farm Divisions of your Company have secured their best performance for the second year in a row reflecting in substantial growth in the net income of the Company by 26.60% to Rs. 23,803 crores in the year under review from Rs.18,801 crores in the previous year.

Consequent to this remarkable performance, the Profit for the year before Depreciation, Interest, Exceptional items and Taxation recorded an increase of 19.37% at Rs. 3,766 crores as against Rs. 3,155 crores in the previous year. Similarly, Profit after tax clocked an increase of 27.51% at Rs. 2,662 crores as against Rs. 2,088 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, process efficiencies and product innovations that exceed customer expectations in all areas thereby enabling the Company to maintain profitable growth in the current economic scenario.

Dividend

Your Directors are pleased to recommend a dividend of Rs.10.50 per Ordinary (Equity) Share and also a Special Dividend of Re.1 per Ordinary (Equity) Share aggregating Rs.11.50 per Ordinary (Equity) Share of the face value of Rs.5 each, payable to those Shareholders whose names appear

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in the Register of Members as on the Book Closure Date.The Special Dividend is being recommended in view of the Profit made by the Company on the sale of its entire holdings in Owens Corning (India) Limited. The proposed dividend will be paid on an enlarged capital base of Rs.306.99 crores (as against Rs.289.21 crores in the previous year). The equity dividend outgo for the Financial Year 2010-11, inclusive of tax on distributed profits (after reducing the tax on distributed profits of Rs.17.98 crores payable by the subsidiaries on the dividends receivable from them during the current Financial Year) would absorb a sum of Rs.802.64 crores (as against Rs.623.75 crores comprising the dividend of Rs.8.75 per Ordinary (Equity) Share and also a Special Dividend of Rs.0.75 per Ordinary (Equity) Share aggregating Rs.9.50 per Ordinary (Equity) Share of the face value of Rs.5 each paid for the previous year).

Performance Review

Automotive Division: Your Company’s Automotive Division recorded total sales of 2,89,333 vehicles and 64,740 three-wheelers as compared to 2,36,759 vehicles and 45,360 three-wheelers in the previous year registering a growth of 22.2% and 42.7% in vehicle sales and three-wheeler sales respectively.

On the domestic sales front, your Company sold 2,74,793 vehicles [including 2,30,110 Multi Utility Vehicles (MUVs), 35,493 small4-wheelers 0.75 Ton cargo/passenger and 9,190 mini 4 wheelers 0.5 Ton cargo/passenger] registering a growth of 21% over the previous year’s volumes of 2,27,114 vehicles [including 2,14,128 MUVs, 3,722 small 4-wheelers 0.75 Ton cargo and 9,264 mini 4 wheelers 0.5 Ton cargo]. The domestic sales volumes of 62,142 three-wheelers were higher by 39.8% as compared to the previous year’s volume of 44,438 three-wheelers.

Your Company’s MUV sales volume grew by 7.5% and your Company continued its leadership of the domestic MUV market by posting a market share of 60.9%. All products of your Company’s Passenger MUV portfolio performed very well. Bolero volumes grew by 17.8% over the previous year and Bolero is currently India’s largest selling MUV for five consecutive years. Scorpio and Xylo volumes also posted an impressive growth of 19.1% and 14.6% respectively.

In February, 2010, your Company had launched Maxximo in a very competitive small 4-wheeler cargo segment (0.75 Ton). During the first full year of sales, Maxximo has impressively established itself in the market, with a sales volume of 35,464 vehicles and a market share of 19.1%.

With an aim to strengthen its product portfolio and to offer better products, your Company has launched four new products viz. Genio, Maxximo Mini Van, Compact Cab–Gio Passenger and Thar which have received good response from the customers.

In the Overseas market, your Company registered a volume growth of 62.2% over the previous year. This growth was driven by volume growth in SAARC, Chile and South Africa. During the year under review, your Company sold 14,540 vehicles [including 305 vehicles sourced from Mahindra Navistar Automotives Limited (“MNAL”)] and 2,598 three-wheelers in the overseas market as compared to 10,567 vehicles [including 1,323 vehicles sourced from MNAL] and 922 three-wheelers in the previous year.

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Spare parts sales for the year stood at Rs.666.97 crores (including Exports of Rs.28.3 crores) as compared to Rs.514.96 crores (including Exports of Rs.22.4 crores) in the previous year, registering a growth of 29.5%.

Farm Division:Your Company’s Farm Division (including Swaraj Division) recorded sales of 2,14,325 tractors as against 1,75,196 tractors sold in the previous year, recording a significant growth of 22.3%.

In the Financial Year 2011, the Indian tractor industry witnessed consecutive second year of high growth. The domestic market recorded sales of 4,80,377 tractors as compared to 4,00,203 tractors in the previous year, recording a growth of 20%.

Your Company outperformed the tractor industry with domestic sales of 2,02,513 tractors as compared to 1,66,359 tractors in the previous year recording a growth of 21.7%. This has also helped your Company to improve its market share which now stands at 42% as compared to 41.4% in the previous financial year, thus completing 28 years of leadership in the Indian tractor industry.Your Company’s tractor exports grew by 33.7% to reach 11,812 tractors as compared to 8,837 tractors exported in the previous year.

Beyond agriculture, in the power generation space under the Mahindra Powerol Brand, your Company sold 27,748 engines in the current financial year as against 48,011 engines in the previous year. Volumes were severely affected due to adverse market conditions in the Telecom Sector.Your Company, while retaining its leadership position in the genset market catering to the telecom space, has focused its presence in the retail segment and has also introduced new products like inverters.

Mahindra Defence Systems Division (MDS): Mahindra Defence Systems (MDS), a Division of your Company is engaged in two businesses – a) Mahindra Defence Naval Systems (MDNS) and b) Mahindra Special Services Group (MSSG).

In the Naval Systems business, your Company currently manufactures Sea Mines, Torpedo Launchers, Decoy Launchers and Composites for various Naval and other applications from its Plant based in Chinchwadgaon, Pune. MDNS has been servicing diverse customers by providing systems and sophisticated components. The Naval Systems business has considerable potential and is poised for a major growth in the field of different types of Sea Mines, Torpedo Decoy Systems and Radar Systems.

In the Special Services Group business, your Company provides corporate risk management consultancy services, assisting organizations in maintaining their competitive edge by protecting Information, Physical and Personnel Assets through implementing the security strategy encompassing people, process and technology. During the year, MSSG has been successful in registering and maintaining the business growth across various industry verticals through a wide range of service offerings in the Corporate Security Risk landscape in India thereby enabling over 150 major corporate customers to secure their people, assets, information and reputation.

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MSSG has witnessed tremendous growth opportunities in the areas of Governance and Fraud Risk Management during the year. MSSG’s marketing and brand promotion activities have been strengthened with increased manpower and as a result, MSSG has been able to make its brand visible in many cities across India.

Management Discussion and Analysis Report

A detailed analysis of the Company’s performance is discussed in the Management Discussion and Analysis Report, which forms part of this Annual Report.

Corporate Governance

Your Company has a rich legacy of ethical governance practices most of which were in place even before they were mandated.Your Company is committed to transparency in all its dealings and places high emphasis on business ethics. During the year, CRISIL has re-affirmed the highest level rating, (Level 1) for Governance and Value Creation for the fifth year in a row. This rating indicates that the capability of the Company with respect to wealth creation for all its stakeholders while adopting strong Corporate Governance practices is the highest.

A Report on Corporate Governance along with a Certificate from the Statutory Auditors of the Company regarding the compliance of conditions of Corporate Governance as stipulated under Clause 49 of the Listing Agreement forms part of this Annual Report.

Share Capital

Increase in Share Capital During the year under review, your Company has allotted: 1)1,81,52,597 Ordinary (Equity) Shares of Rs.5 each upon conversion of Foreign Currency Convertible Bonds into Shares/Global Depositary Receipts (GDRs), each GDR represented by one Ordinary (Equity) Share of Rs.5 each, and 2) 1,73,53,034 Ordinary (Equity) Shares of Rs.5 each to the Trustees of Mahindra & Mahindra Employees’ Stock Option Trust.

Subsequent to the year end, your Company allotted 34,730 Ordinary (Equity) Shares of Rs.5 each to International Finance Corporation, the Shareholder of Mahindra Shubhlabh Services Limited (“MSSL”) in the share exchange ratio of 1 fully paid-up Ordinary (Equity) Share of Rs.5 each for every 190 fully paid-up shares of Rs.10 each held in MSSL pursuant to the Scheme of Arrangement between MSSL and the Company and their respective Shareholders (“the Scheme”). The Scheme became effective on 15th April, 2011.

Post allotment of Equity Shares as aforesaid, the issued, subscribed and paid-up Share Capital of the Company stands at Rs.307 crores comprising of 61,39,74,839 Ordinary (Equity) Shares of Rs.5 each fully paid-up.

Finance

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The overall global growth showed traction in the Financial Year 2011 with Financial Year 2012 promising further improvement, despite the temporary setback arising out of natural calamities in Japan. However globally, monetary and fiscal policies are showing a tightening trend. The developments in Middle East and North Africa coupled with vagaries of global weather have resulted in oil and food prices casting a shadow over forecasts on growth, inflation and policy actions. India’s growth during Financial Year 2011 was strong and various indicators of demand like auto sales, exports, credit off take and cargo movements in recent months show continued upward trends. However, inflation continues to be a worry for monetary and fiscal policy makers. While the Government of India did not take any major adverse measures in Union Budget for Financial Year 2012, the Reserve Bank of India has since March, 2010 raised key policy rates by 350 bps. For the Indian Economy, the Financial Year 2012 could be a challenging year as corporate face commodity price increase and demand gets threatened by rising interest rates.

Your Company continued to focus on managing cash efficiently and ensured that it had adequate liquidity and back up lines of credit. During the year, your Company initiated suitable actions based on financial conditions, to facilitate conversion of debt into equity and raised fresh debt to finance its growth plans.

Your Company had outstanding Foreign Currency Convertible Bonds (“FCCBs”) aggregating USD 189.50 million at the beginning of the year. It issued a notice on 8th October, 2010 for early redemption of its outstanding FCCBs aggregating USD 141.20 million. Prior to the notice for early redemption, the bondholders had opted for conversion of FCCBs aggregating USD 48.30 million into Shares/GDRs. Your Company’s call met with a resounding success with FCCBs aggregating USD 140.10 million representing 99.2% of the outstanding FCCBs of USD 141.20 million being converted into Shares/ GDRs.

Consequently during the year, your Company has on conversion of FCCBs aggregating USD 188.40 million allotted 18.15 million Shares (including Shares underlying GDRs) to the bondholders, who exercised the option to convert these FCCBs into such Shares/ GDRs. Accordingly, your Company’s FCCB debt of Rs.850.85 crores outstanding on its books as at the beginning of the financial year stands extinguished thereby strengthening the credit profile of your Company.

Your Company has also repaid foreign currency loan aggregating Rs.176 crores and Non-Convertible Redeemable Debentures (“NCDs”) of Rs.200 crores during the year. It has successfully raised External Commercial Borrowings aggregating USD 150 million from banks at attractive terms and at benchmark pricing.

Your Company follows a prudent financial policy and aims to maintain optimum financial gearing at all times. The Company’s total Debt to Equity Ratio was 0.23 as at 31st March, 2011.

Your Company has been rated by CRISIL, ICRA Limited (ICRA) and Credit Analysis & Research Limited (CARE) for its banking facilities under Basel II norms. During the year, CRISIL upgraded the rating for Long Term Banking facilities to “AA+/Stable” from the earlier “AA/ Stable”. During the year, ICRA and CARE have maintained a Long Term Rating of “LAA+/Stable” and “CARE AA+” respectively.

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CRISIL, ICRA and CARE have all reaffirmed the highest rating for your Company’s Short Term facilities.Your Company’s Bankers continue to rate your Company as a prime customer and extend facilities/services at prime rates.

Acquisitions and other matters

1)Acquisition of Ssangyong Motor Company Limited (“SYMC”) Your Company acquired SYMC, a premier manufacturer of sports utility vehicles (“SUV”) and recreational vehicles (“RV”) in Korea. The total cost of acquisition of SYMC was KRW 5,22,50,00,00,000 (approximately $463 million) with KRW4,27,09,52,35,000 (approximately $378 million) payable for new stocks and KRW 95,40,47,65,000 (approximately $85 million) in corporate bonds for an equity stake of around 70% in SYMC.

SYMC was founded in 1954 and has been manufacturing automobiles for more than five decades. SYMC has a strong domestic network of over 130 dealers and exports to over 90 countries through over 1,200 dealers.

SYMC has been undergoing a corporate rehabilitation process since February, 2009 and the court receivership has now concluded upon court approval and the corporate rehabilitation process has been terminated in March, 2011.

This acquisition will help your Company to emerge as a competitive global utility vehicle player by leveraging on your Company’s competence in sourcing and marketing strategy and SYMC’s strong global presence.Your Company is committed to nurturing the Ssangyong brand in global markets while preserving its Korean heritage. It is intended that SYMC will continue to function as an independent entity with primarily a Korean Management. The acquisition will offer financial stability to SYMC and will work to further strengthen SYMC’s product portfolio across the globe.

The strong complementarities between SYMC and your Company’s portfolio of products and technology provide an opportunity to create distinct positioning. The wide sales and distribution networks and complementary product lines will provide access to many overseas markets for both the companies.

2)EPC Industrie’ Limited – The Farm Division of your Company has been working in the wider agriculture domain through Mahindra Shubhlabh Services Limited and through various Mahindra Samriddhi centers across the country. Farm Division’s vision is to “Deliver FarmTech Prosperity” and in line with this vision; your Company has decided to foray into the Micro-irrigation industry. Micro-irrigation brings various benefits to the farmer, such as reduced requirement of water, fertilizers, electricity, labor, etc. with increase in productivity. Entry into the micro-irrigation business is an important step towards realization of the Division’s vision. It also signifies your Company’s commitment to conserve the most precious natural resource viz. Water. More than 80% of available water in India is consumed in agriculture. Micro irrigation is a water efficient irrigation technology which has been identified as one of the major focus area by the Agricultural Department.

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Thus, keeping the opportunities in Agricultural Sector in mind, your Company has acquired 38% of the paid-up Equity Share Capital through a Preferential Allotment in EPC Industrie’ Limited (EPC), a company listed on the Bombay Stock Exchange Limited. Pursuant to the above acquisition, the Company is in the process of making an Open Offer under the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 1997 (“Takeover Code”) to the Shareholders of EPC for 20% of the enhanced Share Capital of EPC as per the terms of the Takeover Code.

EPC established in 1981 is based in Nasik, Maharashtra and is known for its quality products. EPC has grown as one of the top five companies in India in the micro-irrigation space.

Your Company already has a very strong presence in the Tractor and Farm machinery business and with the current entry in the micro – irrigation business, your Company would be in a position to serve the farmer in a much better way and create a strong differentiation for the brand “Mahindra”.

3) Demerger of the Non Fruit Business of Mahindra Shubhlabh Services Limited into your Company - The Honourable High Court of Judicature at Bombay has approved the Scheme of Arrangement between Mahindra Shubhlabh Services Limited (“MSSL”) and your Company and their respective Shareholders which inter alia envisages demerger of the Agri Inputs Business along with other common assets and liabilities (“Non Fruit business”) of MSSL into the Company.

4) Strategic Sale of part of the Company’s Shareholding in Mahindra Consulting Engineers Limited (“MACE”) to SAFEGE – a France based Multi Disciplinary Consultancy Company – MACE, a subsidiary of the Company is engaged in engineering, project advisory and infrastructure consulting activities covering urban infrastructure, water, wastewater, waste management, environment, urban planning, industrial infrastructure, transportation, rural infrastructure, etc.

MACE entered into a strategic partnership with SAFEGE, France and post induction of the strategic partner, your Company holds 54.16% of the Equity Share Capital of MACE, whilst 30.83% is held by SAFEGE and balance 15.01% is held by Mahindra Consulting Engineers Employees Stock Option Trust and /or its beneficiaries.

SAFEGE activities are synergetic with thrust and growth areas identified for Indian Engineering and Infrastructure consultancy. “MACE-SAFEGE” partnership will be a strategic vehicle to develop business in India, neighboring countries and the Middle East and Asia besides other international markets in identified areas of activities. Through this strategic partnership, MACE will also offer support to SAFEGE’s International Assignments and MACE would be well poised to handle large domestic projects in India requiring international expertise.

5) Joint Venture with Arabia Holdings Limited and Ras-Al-Khaimah Transport Investments Co. LLC - Through its Mahindra Defence Systems Division (MDS), your Company has over the past eight years acquired a leadership position in India in the field of research, design, development and manufacture of armoured and light military vehicles. In order to address the large and growing market for uparmoured vehicles globally especially in West Asia, Central Asia and Africa, in June, 2010, your Company had entered into a Joint Venture with Arabia Holdings Limited and Ras-Al-Khaimah

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Transport Investments Co. LLC through its wholly owned subsidiary Mahindra Overseas Investment Company (Mauritius) Limited to form a Joint Venture company viz. “Mahindra Emirates Vehicle Armouring FZ LLC” or “MEVA” in the Emirate of Ras-Al- Khaimah in the UAE for armouring of vehicles.

Your Company holds a 51% stake in MEVA which would design and develop ballistic kits for vehicle protection.The other Joint Venture partners would provide necessary infrastructural support to MEVA for establishing the operations in the Emirate of Ras-Al-Khaimah. MEVA intends to launch a number of MDS armoured vehicles such as the Marksman, the uparmoured Scorpio, Cash in Transit Van, etc. which have been very successful in India. MEVA will also be doing armouring of non-MDS vehicles such as Toyota, Nissan, etc.

Stock Options

Pursuant to the approval of the Members at the previous Annual General Meeting held on 28th July, 2010, your Company has adopted and introduced Mahindra & Mahindra Limited Employees Stock Option Scheme - 2010 (“New Scheme”). On the recommendation of the Remuneration/Compensation Committee of your Company, the Trustees of the Mahindra & Mahindra Employees’ Stock Option Trust have granted 32,16,758 Stock Options to Eligible Employees under the New Scheme. During the year under review, no new options have been granted under the Mahindra & Mahindra Limited Employees Stock Option Scheme - 2000.

Details required to be provided under the Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 are set out in Annexure I to this report.

Industrial Relations

Industrial Relations generally remained cordial and harmonious throughout the year, apart from a one day illegal tool down strike by the Nashik Plant Workmen to press for their demands for increase in wages and for up gradation for a section of workmen. The loss of production for that day was compensated within the same week and the Company did not suffer any loss. On the contrary, the highest ever production was recorded in the month of March, 2011.

The Management Discussion and Analysis Report give an overview of the developments in Human Resources/Industrial Relations during the year. In a restructuring exercise to rightsize the work force, your Company has, during the year under review accepted Voluntary Retirement from 146 employees at Kandivali Plant of the Farm Division.Your Company has set an example of harmonious industrial relationship by celebrating the 40th Anniversary of uninterrupted existence of Union at Kandivali Plant of the Farm Division.

Safety, Health and Environmental Performance

Health and Safety Your Company continues to demonstrate a strong commitment towards Safety, Health and Environment and as a part of the same, following measures and actions were taken

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during the year under review.Your Company has a well-established Safety, Occupational Health & Environmental Policy. Objectives and Targets derived from the Policy are supported by Management Programs.

The Safety & Occupational Health of its employees is embedded as core organizational values of the Company. The 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 as per training calendar, carries out statutory safety assurance and audits of its facilities as per legal requirements, conducts regular medical and occupational check-up of its employees and promotes health-friendly sustainable activities.

Fire Service Day and Safety Week are being celebrated; Safety audits/ Inspection along with Safety awareness training with benchmarks on safety performance are conducted.Your Company’s Plants continued their commitment to improve the well being of its employees and contract workmen by organizing Occupational Health Examination Camps, medical check-ups, etc.

Through stakeholder’s engagement and employee’s involvement, your Company demonstrates its road map on the fundamentals of Planet, People and Profit. Various path breaking projects have been implemented by your Company in the areas of Air Pollution Management, Water and Waste Water Management, Solid Waste Management and Greenbelt Development.

New Certifications: The Sustainability Reporting System provides framework for your Company’s environmental initiatives, sets objectives and targets and helps in continually improving its air quality by controlling emissions, water pollution and minimizing waste from its processes. All Plants of the Automotive Division have been certified 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 in and around the Society. Its nature of operations has a low impact on the environment by implementing Environment Management System wherein a healthy work environment is provided to its employees and environment friendly businesses are conducted. Besides, to bring cross cultural sensitivity of the Company’s business associates, promotional activity towards Green Supply Chain Management has also been initiated.

Implementation of Occupational Health & Safety Management System standard has re-enforced the Company’s commitment of Safety and Occupational Health to the highest levels. OHSAS 18001:2007 is the existing best safety practices standard which is implemented through the amended Management System and all Plants of the Automotive Division have been certified during the year 2010-11. The OHSAS system aims to eliminate or minimize risk to employees and other interested parties who may be exposed to Occupational Safety risks associated with its activities. Sustainable development is promoted across the Division through sharing of best practices in the fields of Safety, Occupational Health & Environment.

Corporate Social Responsibility

Through its various Corporate Social Responsibility (“CSR”) initiatives, the Mahindra Group is enabling entire communities to ‘RISE’. With a vision of transforming the lives of youth from socially weaker

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and economically disadvantaged sections of society, the Mahindra Group has established various scholarships and other educational initiatives which help empower these communities. In addition, other CSR initiatives such as Project Hariyali in the area of environment and supporting ‘Lifeline Express’ in the area of health continue to drive positive change in the lives of communities.

CSR continues to be an integral part of the vision of the Mahindra Group and this year too, your Company has pledged 1% of its Profit after Tax for CSR initiatives, largely to benefit the socially and economically disadvantaged sections of Society.

Some of the major initiatives your Company has invested in are described below:

A. Nanhi Kali Nanhi Kali is a sponsorship program that supports the education of disadvantaged girl children in India. Through the Nanhi Kali sponsorship, underprivileged girls are provided not only academic support but also uniforms, school bags, shoes, etc. which allow the girls to attend school with dignity. Through the support of 8,000 donors, the Nanhi Kali project is supporting the education of 70,000 underprivileged girls in 9 states in India. The largest donor is the Mahindra Group which supports the education of 23,000 Nanhi Kalis.

B. Mahindra Pride Schools 2,400 students from socially weaker sections of Society have been provided with livelihood training at Mahindra Pride School in Pune. The training is provided for those who wish to gain employment in the Hospitality Sector, Information Technology Sector for BPOs and KPOs and the Retail Sector. The composition of students consists of scheduled caste and scheduled tribe youth, most of whom have not even completed their education. After completing their training, 100% of the students have been placed in lucrative jobs. The second Mahindra Pride School was opened in Chennai early this year. This school would train approximately 600 students in a year.

C. Scholarships & Grants Mahindra All India Talent Scholarships was awarded to students from lower socio economic strata of society who wish to pursue job oriented Diploma Courses in Government Polytechnics. The K. C. Mahindra Scholarships for Post-Graduate studies abroad provide interest free loan scholarships to various deserving students.Your Company is also supporting 15 Mumbai Public. Schools which provide quality English medium public education to students from lower socio economic strata of Society.

Employee Social Options

Your Company is tapping the potential hidden within each one of its employees to make a sustainable society; one which is healthier, cleaner, greener and more literate. The Mahindra Workforce is a powerhouse of inexhaustible energy where people work with passion in abundance and also for the betterment of the Society. Through your Company’s Employee Social Options (ESOPs) program many Mahindra employees are contributing towards making difference to Society.

Your Company’s ESOPs program encourages employees in supporting volunteering projects based on the needs of underprivileged communities in and around their places of work. Employees generate ideas for projects, prepare annual activity plans, implement each activity and monitor results. To

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fund these Employee initiatives, each Sector donates 0.5 percent of its profit after tax to the ESOPs Central CSR fund.

During the year under review, 15,147 employees volunteered in various initiatives contributing 73,509 man-hours in various social initiatives in and around their local communities.

Some of the notable ESOPs initiatives this year were the Lifeline Express in Farrukhabad for performing surgeries free of cost, Mahindra Hariyali for planting one million trees, ESOPs Awards – 2010, etc.

Your Company’s ESOPs activities also included initiatives in Education, Health, Environment and others having short term as well as long term impact on the beneficiaries.

Sustainability’ Initiative

Your Company embarked on the sustainability journey in November, 2007 and over these last four years has laid a foundation for developing a sustainable enterprise. Conscious efforts have been made to consider the impact of the Company’s business on the environment and its responsibility towards the communities in which it operates, besides focusing on economic progress. During the year, your Company’s triple bottom line performance for 2009-10 was published in accordance with the latest guidelines of the internationally accepted Global Reporting Initiative or the GRI standards and like in case of the previous two Reports, this Report was externally assured by Ernst & Young with an A+ rating and GRI checked. The Report for the year 2010-11 is under preparation and will be released shortly.

During the year 2009-10, a Carbon foot-printing exercise was undertaken to inventories GHG emissions from all your Company’s business operations under Scope I, II and III emissions as per internationally accepted standards. This has enabled the Company to establish a baseline on emissions. This will be an ongoing exercise and continuous reduction in the GHG intensity of all products and processes will be the Company’s constant endeavor.

The focus all along has been on transparent and comprehensive reporting, due to which your Company has been ranked in the list of top 10 companies in India by the Carbon Disclosure Leadership Index 2010 and the Standard & Poor ESG India Index 2010.Your Company also secured a second place in the Green Business Leadership Awards 2010-11, instituted by Financial Express and Emergent Ventures.

Being conscious of the fact that the Company’s products touch many lives and livelihoods in many ways and that the progress of many communities is linked to the Company’s success, with a continued use of the strategic approach of ‘ALTERNATIVE THINKING’, your Company is committed to creating a sustainable enterprise.

Directors

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Mr. Anand G. Mahindra, Mr. Bharat Doshi, Mr. Nadir B. Godrej and Mr. M. M. Murugappan retire by rotation and, being eligible, offer themselves for re-appointment.

Directors’ Responsibility Statement

Pursuant to Section 217(2AA) of the Companies Act, 1956, your Directors, based on the representations received from the Operating Management, and after due enquiry, confirm that: (i) in the preparation of the annual accounts, the applicable accounting standards have been followed; (ii) they have, in the selection of the accounting policies, consulted the Statutory Auditors and these have been applied consistently and reasonable and prudent judgments and estimates have been made so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2011 and of the profit of the Company for the year ended on that date; (iii) proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; (iv) the annual accounts have been prepared on a going concern basis.

Subsidiary Companies

The subsidiary companies of your Company continue to contribute to the overall growth of the Company. Major subsidiaries such as Mahindra & Mahindra Financial Services Limited with a 38.49% growth in its consolidated profits and Mahindra Lifespace Developers Limited with a 37.81% growth in its consolidated profits deserve special mention. The consolidated Group Profit for the year after exceptional items, prior period adjustments and tax and after deducting minority interests is Rs.3,079.73 crores as against Rs. 2,478.56 crores earned in the previous year.

During the year under review, Mahindra Aerospace Australia Pty. Limited, Aerostaff Australia Pty. Limited, Mahindra Reva Electric Vehicles Private Limited (earlier known as Reva Electric Car Company Private Limited), Bristlecone Consulting Limited, Anthurium Developers Limited, Watsonia Developers Limited, Gipp Aero Investments Pty. Limited, Gippsaero Pty. Limited, GA8 Airvan Pty. Limited, GA200 Pty. Limited, Airvan Flight Services Pty. Limited, Gipp Aero International Pty. Limited, Nomad TC Pty. Limited, Mahindra Emirates Vehicle Armouring FZ-LLC, Mahindra Solar One Private Limited, Mahindra BPO Services Private Limited, Mahindra Aerostructures Private Limited, Ssangyong Motor Company Limited, Ssangyong European Parts Center B.V., Ssangyong Motor (Shanghai) Co. Limited, Ssangyong (Yizheng) Auto Parts Manufacturing Co. Limited and Mahindra EPC Services Private Limited became subsidiaries of your Company.

During the year under review, ID-EE S.r.l. and Mahindra Solar One Private Limited ceased to be subsidiaries of the Company.

The Statement pursuant to Section 212 of the Companies Act, 1956 containing details of the Company’s subsidiaries is attached.

In accordance with the General Circular issued by the Ministry of Corporate Affairs, Government of India, the Balance Sheet, Profit and Loss Account and other documents of the subsidiary companies

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are not being attached with the Balance Sheet of the Company. The Company will make available the Annual Accounts of the subsidiary companies and the related detailed information to any Member of the Company who may be interested in obtaining the same. Further, the Annual Accounts of the subsidiaries would also be available for inspection by any Member at the Head Office of the Company and at the Office of the respective subsidiary companies, during working hours upto the date of the annual general meeting.

Consolidated Financial Statements

The Consolidated Financial Statements of the Company and its subsidiaries, prepared in accordance with Accounting Standard AS21 form part of this Annual Report. The Consolidated Financial Statements presented by the Company include the financial results of its subsidiary companies, associates, joint ventures, etc.

Auditors

Messrs. Deloitte Haskins & Sells, Chartered Accountants, retire as Auditors of the Company and have given their consent for reappointment. The Members would be required to elect Auditors for the current year and fix their remuneration. As required under the provisions of Section 224(1B) of the Companies Act, 1956, the Company has obtained a written Certificate from the above Auditors proposed to be re-appointed to the effect that their re-appointment, if made, would be in conformity with the limits specified in the said section.

Cost Auditors

As per the Order of the Central Government and in pursuance of Section 233B of the Companies Act, 1956, your Company carries out an audit of its cost records. The due date for filing of the Cost Audit Report with the Ministry of Corporate Affairs for the financial year ended 31st March, 2010 was 30th September, 2010. This Report was filed on 24th September, 2010. The Board of Directors of your Company has upon recommendation of the Audit Committee appointed M/s. N. I. Mehta & Co., Cost Accountants to audit the cost accounts of the Company for the financial year ending 31st March, 2012, subject to the approval of the Central Government. As required under the provisions of Section 224(1B) of the Companies Act, 1956, the Company has obtained a written confirmation from M/s. N. I. Mehta & Co. to the effect that they are eligible for appointment as Cost Auditors under Section 233B of the Companies Act, 1956.

Public Deposits and Loans/Advances

Out of the total 14,047 deposits of Rs. 93.09 crores from the Public and Shareholders as at 31st March, 2011, 190 deposits amounting to Rs. 0.82 crores had matured and had not been claimed as at the end of the Financial Year. Since then, 63 of these deposits of the value of Rs. 0.45 crores have been claimed.

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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.

Current Year

During the period 1st April, 2011 to 29th May, 2011, 50,216 vehicles were despatched as against 47,022 vehicles during the corresponding period in the previous year. During the same period, 40,971 tractors were despatched as against 30,302 tractors despatched during the corresponding period in the previous year.

With both input costs and interest rates rising, the economic environment is significantly more challenging today than it was a year ago. However, the Company expects to meet these challenges, through its intense and continuous focus on cost controls, innovation, and product quality and market diversification.

Energy Conservation, Technology Absorption and Foreign Exchange Earnings and Outgo

Particulars required to be disclosed under the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 are set out in Annexure II to this Report.

Particulars of Employees

The Company had 113 employees who were in receipt of remuneration of not less than Rs. 60,00,000 during the year ended 31st March, 2011 or not less than Rs. 5,00,000 per month during any part of the said year. However, as per the provisions of Section 219(1) (b)(iv) of the Companies Act, 1956, the Directors’ Report and Accounts are being sent to all the Members of the Company excluding the Statement of particulars of employees. Any Member interested in obtaining a copy of the Statement may write to the Company Secretary of the Company.

Mahindra & Mahindra, Ltd. Page 46 © Datamonitor Mahindra & Mahindra, Ltd. Locations and Subsidiaries

LOCATIONS AND SUBSIDIARIES Head Office Mahindra & Mahindra, Ltd. Mahindra Towers G.M. Bhosale Marg Worli Mumbai Maharashtra 400 018 IND P:91 22 2497 5074 F:91 22 2490 0833 http://www.mahindra.com

Other Locations and Subsidiaries

Mahindra & Mahindra South Africa Mahindra USA, Inc. (Proprietary) Limited USA ZAF

Mahindra Graphic Research Design S.r.l. Mahindra Gears International Limited ITA MUS

NBS International Limited Mahindra Automobile Distributor Private IND Limited (formerly known as Mahindra Renault Private Limited) IND

Mahindra Logistics Limited Mahindra (China) Tractor Company Limited IND CHN

Mahindra Engineering GmbH BAH Hotelanlagen AG DEU AUT

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