MAM HHINDDRARA & MAHINNDRD A LTL D. ANANNUNUALA REPE ORRT 2001515 WorldReginfo - 0cd6c777-56c0-4f13-9576-4861e33bf4aa WorldReginfo - 0cd6c777-56c0-4f13-9576-4861e33bf4aa RESILIENCE THROUGH RESILIENCE THROUGH MARKET LEADERSHIP CUSTOMER CENTRICITY Sustained market leadership in Tractors Ranked 3rd in JD Power SSI survey for over 3 decades Ranked 4th in JD Power CSI Study 5 millionth vehicle rolled out in January 2015 RESILIENCE THROUGH RESILIENCE THROUGH PORTFOLIO DIVERSIFICATION STRONG FINANCIALS Market value of investments in EBITDA (including MVML) grew listed entities ~ Rs. 30,000 at 19% CAGR over the last crores (invested value – Resilience decade ~ Rs. 4,200 crores) AAA rating from all major rating agencies citing Mahindra’s “Resilience to Economic Cycles” RESILIENCE THROUGH INNOVATION RESILIENCE IN VALUE CREATION World class R&D Center at Mahindra Research Valley, Chennai Share price growth at 25% 100% increase in patent applications CAGR over the last decade Unbroken dividend record since listing on BSE in 1956 WorldReginfo - 0cd6c777-56c0-4f13-9576-4861e33bf4aa In January 2015, Mahindra rolled out its 5 millionth vehicle from its automotive plant at Kandivali, Mumbai. The company’s legendary 4x4 off-road vehicle, the Mahindra Thar was chosen for this momentous milestone. Dr. Pawan Goenka, Executive Director, Mahindra & Mahindra Ltd. and Group President (Auto & Farm Sector) presided over the ceremony and dedicated this significant achievement to each and every member of the Mahindra family. WorldReginfo - 0cd6c777-56c0-4f13-9576-4861e33bf4aa Mahindra Drives in the New Age XUV500 The New Age XUV 500 is packed with a host of cutting-edge technology features, bold new cheetah-inspired exterior styling, plush and premium new interiors, exhilarating performance and best-in-class safety. Mahindra pioneers technologically superior farming solutions with the Arjun Novo Technologically advanced and stylishly designed, the Arjun Novo has created new benchmarks in performance, technology and ergonomics and is one of the most comfortable tractors in its category. WorldReginfo - 0cd6c777-56c0-4f13-9576-4861e33bf4aa Driving Positive Change Corporate Social Responsibility or CSR is an integral part of the Mahindra Group with Education, Public Health and the Environment forming the key focus areas of our programme. From providing academic, material and social support to underprivileged girls across India through Project Nanhi Kali to supporting Impact India’s Lifeline Express, the world’s first hospital on wheels, the Mahindra Group seeks to drive positive change and help make the world a better place. The Mahindra Group has pledged to support the Prime Minister’s CLEAN INDIA campaign through the Swachh Bharat Swachh Vidhyalaya program, by committing to build 1,000 toilets blocks (preferably for girls) in government schools across 13 states of India. Employees across the Group also devote their personal time and energy to help the disadvantaged through ESOPs or the Employee Social Options Programme. From blood donation drives and sapling plantation to visits to old age homes, our Esops volunteers are making a difference to the lives of many. We present a few glimpses of Mahindra’s CSR activities through the year. A blood donation drive in progress Mahindra Intertrade donates educational material to school children Tech Mahindra Foundation participates in a Swachh Bharat Campaign Mahindra Lifespaces conducts a medical camp WorldReginfo - 0cd6c777-56c0-4f13-9576-4861e33bf4aa Mahindra Pride School graduates take on the retail sector Training underway at a Mahindra Pride School Mahindra Intertrade donates toys to underprivileged children Mahindra Holidays helps flood affected villagers A smiling Nanhi Kali goes to school WorldReginfo - 0cd6c777-56c0-4f13-9576-4861e33bf4aa Chairman Emeritus & Board of Directors Left to Right: Standing: Anupam Puri, Bharat Doshi, Dr. Pawan Kumar Goenka, Anand G. Mahindra, M. M. Murugappan, Nadir B. Godrej, S. B. Mainak, Vikram Singh Mehta Seated: R. K. Kulkarni, Deepak S. Parekh, Keshub Mahindra (Chairman Emeritus), Dr. Vishakha N. Desai WorldReginfo - 0cd6c777-56c0-4f13-9576-4861e33bf4aa Group Executive Board Left to Right Standing: Ulhas Yargop, Group President (IT Sector) & Group CTO, Pravin Shah, President & Chief Executive (Automotive), Rajesh Jejurikar, President & Chief Executive (Farm Equipment & Two Wheeler), Zhooben Bhiwandiwala, Managing Partner - Mahindra Partners & President (Group Legal), Ruzbeh Irani, President (Group Communications & Ethics) & Chief Brand Officer, Harsh Kumar, Managing Director (Mahindra Intertrade Ltd.), Ramesh Iyer, Managing Director (Mahindra & Mahindra Financial Services Ltd.) & President (Financial Services Sector), Rajeev Dubey, Group President (HR & Corporate Services) & CEO (After-Market Sector), C.P. Gurnani, Managing Director & CEO - Tech Mahindra, Kavinder Singh, Managing Director & CEO (Mahindra Holidays and Resorts India Ltd.) & President (Leisure & Hospitality Sector), Johng-sik Choi, President & CEO - Ssangyong Motor Co. Seated: Anish Shah, Group President (Strategy), V S Parthasarathy, Group CFO, Group CIO & President (Group Finance and M&A), Anand Mahindra, Chairman & Managing Director, Mahindra & Mahindra Ltd., Rajan Wadhera, President & Chief Executive (Truck & Power Train), Head - Mahindra Research Valley (MRV), Ashok Sharma, President & Chief Executive (Agri and Africa & South Asia Operations), Anita Arjundas, Managing Director & CEO (Mahindra Lifespace Developers Ltd.) & President (Real Estate Sector), Pawan Goenka, Executive Director - Mahindra & Mahindra Ltd. & Group President (Auto and Farm Sector), S. P. Shukla, Group President and CEO (Aerospace & Defence Sector), S. Durgashankar, President (Group M&A, Corporate Accounts & Group Secretarial) WorldReginfo - 0cd6c777-56c0-4f13-9576-4861e33bf4aa COMMITTEES OF THE BOARD CHAIRMAN EMERITUS BANKERS Audit Committee Mr. Keshub Mahindra Bank of America N.A. Mr. Deepak S. Parekh - Chairman Bank of Baroda Mr. Nadir B. Godrej BOARD OF DIRECTORS Bank of India Mr. M. M. Murugappan Mr. Anand G. Mahindra Canara Bank Mr. R. K. Kulkarni Chairman & Managing Director Mr. Bharat Doshi Central Bank of India Dr. Pawan Goenka HDFC Bank Limited Stakeholders Relationship Committee Executive Director Standard Chartered Bank Mr. R. K. Kulkarni - Chairman State Bank of India Mr. Anand G. Mahindra Mr. Bharat Doshi Union Bank of India Mr. Bharat Doshi Mr. Deepak S. Parekh Dr. Vishakha N. Desai Mr. Nadir B. Godrej AUDITORS Governance, Nomination and Deloitte Haskins & Sells Mr. M. M. Murugappan Remuneration Committee Tower 3, 27th – 32nd Floor, Mr. M. M. Murugappan - Chairman Mr. R. K. Kulkarni Indiabulls Finance Centre, Mr. Nadir B. Godrej Elphinstone Mill Compound, Mr. Anupam Puri Mr. Vikram Singh Mehta Senapati Bapat Marg, Mr. R. K. Kulkarni Dr. Vishakha N. Desai Elphinstone (W), Mumbai 400 013 Corporate Social Responsibility Committee Mr. Vikram Singh Mehta Dr. Vishakha N. Desai - Chairperson ADVOCATES Mr. S. B. Mainak Mr. Anand G. Mahindra Khaitan & Co., Nominee of Life Insurance Corporation Dr. Pawan Goenka One Indiabulls Centre, of India Mr. Bharat Doshi 13th Floor, 841, Senapati Bapat Marg, Mr. R. K. Kulkarni Elphinstone Road, Mumbai 400 013 Mr. Vikram Singh Mehta Strategic Investment Committee Mr. Narayan Shankar REGISTERED OFFICE Mr. Anand G. Mahindra - Chairman Company Secretary Gateway Building, Apollo Bunder, Mr. Bharat Doshi Mumbai 400 001 Mr. Deepak S. Parekh Mr. Nadir B. Godrej Mr. Vikram Singh Mehta Mr. Anupam Puri Loans & Investment Committee Mr. Anand G. Mahindra - Chairman Mr. Bharat Doshi Dr. Pawan Goenka Mr. R. K. Kulkarni Mr. Vikram Singh Mehta CONTENTS Research & Development Committee Directors’ Report .......................................................................................................9 Mr. M. M. Murugappan - Chairman Mr. Anand G. Mahindra Management Discussion and Analysis ...................................................................71 Dr. Pawan Goenka Mr. Bharat Doshi Corporate Governance ............................................................................................93 Mr. Nadir B. Godrej Risk Management Committee Business Responsibility Report .............................................................................113 Dr. Pawan Goenka - Chairman Mr. Deepak S. Parekh Accounts .................................................................................................................129 Mr. Nadir B. Godrej Mr. M. M. Murugappan Consolidated Accounts ..........................................................................................183 Mr. R. K. Kulkarni Mr. Bharat Doshi 8 WorldReginfo - 0cd6c777-56c0-4f13-9576-4861e33bf4aa WorldReginfo - 0cd6c777-56c0-4f13-9576-4861e33bf4aa WorldReginfo - 0cd6c777-56c0-4f13-9576-4861e33bf4aa MAHINDRA & MAHINDRA LIMITED Directors’ Report Dear Shareholders Stabilisation and recovery are the two words that best characterise India’s economic performance in the Financial Year Your Directors present their Report together with the audited 2014-15. Supported by benign prices across the commodity financial statements of your Company for the year ended complex – food, metals and crude oil, the country’s macros 31st March, 2015. witnessed a sharp and reassuring consolidation. The centre’s fiscal deficit dropped to 4.1% from 4.4% a year ago and is A. FINANCIAL AND OPERATIONAL HIGHLIGHTS set to consolidate further in the current Financial Year. The country’s balance of payments registered a healthy surplus, (Rs. in crores) while the