COMPANY BOARD’S MANAGEMENT DISCUSSION CORPORATE BUSINESS RESPONSIBILITY STANDALONE CONSOLIDATED

236 OVERVIEW REPORT AND ANALYSIS GOVERNANCE REPORT ACCOUNTS ACCOUNTS

Balance Sheet | as at 31st March 2020

Rupees crores
Note No. 2020 2019
I. ASSETS
NON-CURRENT ASSETS
Property, plant and equipment.......................................................................................................... 4 7,980.76 7,614.71
Capital work-in-progress..................................................................................................................... 1,196.68 706.77
Intangible assets.................................................................................................................................. 5 2,413.83 2,467.04
Intangible assets under development................................................................................................ 2,812.78 1,713.02
Financial assets
(i) Investments.................................................................................................................................. 6 17,748.48 19,032.07
(ii) Loans............................................................................................................................................ 7 138.86 37.55
(iii) Other financial assets................................................................................................................. 8 486.38 494.18
Income tax assets (net)........................................................................................................................ 929.28 827.56
Other non-current assets..................................................................................................................... 9 1,653.52 1,733.10
35,360.57 34,626.00
CURRENT ASSETS
Inventories............................................................................................................................................ 10 3,400.91 3,839.27
Financial assets
(i) Investments.................................................................................................................................. 6 2,189.65 2,983.96
(ii) Trade receivables......................................................................................................................... 11 2,998.98 3,946.30
(iii) Cash and cash equivalents......................................................................................................... 12 2,323.51 2,237.58
(iv) Bank balances other than cash and cash equivalents............................................................. 12 1,913.00 1,494.08
(v) Loans............................................................................................................................................ 7 512.02 673.40
(vi) Other financial assets................................................................................................................. 8 506.41 556.22
Other current assets............................................................................................................................ 9 1,297.01 2,321.84
Assets held for sale.............................................................................................................................. 13 — 18.41
15,141.49 18,071.06
TOTAL ASSETS...................................................................................................................................... 50,502.06 52,697.06
II. EQUITY AND LIABILITIES
EQUITY
Equity share capital............................................................................................................................. 14 596.52 595.80
Other equity......................................................................................................................................... 15 33,871.32 33,613.43
34,467.84 34,209.23
LIABILITIES
NON-CURRENT LIABILITIES
Financial liabilities
(i) Borrowings.................................................................................................................................. 16 2,032.03 2,031.78
(ii) Other financial liabilities............................................................................................................ 17 560.07 451.18
Provisions.............................................................................................................................................. 18 922.98 1,016.93
Deferred tax liabilities (net)................................................................................................................ 19 1,408.17 634.13
Other non-current liabilities............................................................................................................... 20 138.15 153.74
5,061.40 4,287.76
CURRENT LIABILITIES
Financial liabilities
(i) Borrowings.................................................................................................................................. 16 900.00 448.54
(ii) Trade payables
(a) Total outstanding dues of Micro Enterprises and Small Enterprises............................. 21 102.11 118.98
(b)  Total outstanding dues of creditors other than Micro Enterprises and Small
Enterprises............................................................................................................................ 21 6,683.72 9,559.17
(iii) Other financial liabilities............................................................................................................ 17 1,052.85 956.14
Other current liabilities....................................................................................................................... 20 1,422.22 2,362.57
Provisions.............................................................................................................................................. 18 595.56 554.67
Current tax liabilities (net).................................................................................................................. 216.36 200.00
10,972.82 14,200.07
TOTAL EQUITY AND LIABILITIES......................................................................................................... 50,502.06 52,697.06

}
The accompanying notes 1 to 41 are an integral part of the Financial Statements
In terms of our report attached.
Nadir B. Godrej Anand G. Mahindra Executive Chairman
For B S R & Co. LLP M. M. Murugappan
Chartered Accountants Dr. Vishakha N. Desai Dr. Pawan Goenka Managing Director and CEO
Firm’s Registration No : 101248W/W-100022 Vikram Singh Mehta Dr. Anish Shah Deputy Managing Director and Group CFO
T. N. Manoharan Directors
Jamil Khatri Vijay Kumar Sharma Rajesh Jejurikar Executive Director (Auto and Farm Sectors)
Partner Haigreve Khaitan
Membership No : 102527 Narayan Shankar Company Secretary
Shikha Sharma
Mumbai, 12th June, 2020 CP Gurnani Mumbai, 12th June, 2020
 MAHINDRA & MAHINDRA LTD.
INTEGRATED ANNUAL REPORT 2019-20 237

Statement of Profit and Loss | for the year ended 31st March 2020

Rupees crores
Note No. 2020 2019
INCOME
Revenue from operations................................................................................................................... 22 45,487.78 53,614.00
Other income....................................................................................................................................... 23 1,667.81 1,688.97
Total income......................................................................................................................................... 47,155.59 55,302.97

EXPENSES
Cost of materials consumed................................................................................................................ 24 22,873.74 27,095.07
Purchases of stock-in-trade................................................................................................................. 8,349.36 12,111.61
Changes in inventories of finished goods, stock-in-trade and work-in-progress.......................... 25 409.49 (950.19)
Employee benefits expense................................................................................................................ 26 2,880.08 2,980.22
Finance costs........................................................................................................................................ 27 113.23 113.39
Depreciation, amortisation and impairment expense...................................................................... 28 2,222.63 1,860.40
Other expenses.................................................................................................................................... 29 5,384.59 5,867.23
42,233.12 49,077.73
Less: Amounts capitalised................................................................................................................... 207.54 129.50
Total expenses 42,025.58 48,948.23
Profit before exceptional items and tax........................................................................................... 5,130.01 6,354.74
Exceptional items (net)........................................................................................................................ 30 (2,013.98) (29.73)
Profit before tax.................................................................................................................................. 3,116.03 6,325.01
Tax expense
Current tax................................................................................................................................... 19 996.98 1,179.12
Deferred tax................................................................................................................................. 19 788.50 349.85
Profit for the year............................................................................................................................... 1,330.55 4,796.04
Other comprehensive income/(loss)
A. (i) Items that will not be reclassified to profit or loss
(a) Remeasurements of the defined benefit plans....................................................... (11.18) (13.60)
(b) Equity instruments through other comprehensive income.................................... (0.78) (0.73)
(ii) Income tax relating to items that will not be reclassified to profit or loss.................. 3.25 4.75
B. (i) Items that will be reclassified to profit or loss
(a) Debt instruments through other comprehensive income....................................... 0.68 1.88
(b) 
Effective portion of gains and losses on designated portion of hedging
instruments in a cash flow hedge............................................................................ (35.28) 31.84
(ii) Income tax relating to items that will be reclassified to profit or loss......................... 11.21 (11.79)
Total other comprehensive (loss)/income......................................................................................... (32.10) 12.35
Total comprehensive income for the year........................................................................................ 1,298.45 4,808.39
Earnings per equity share:
(Face value Rs. 5/- per share) (Rupees)
Basic...................................................................................................................................................... 31 11.16 40.29
Diluted.................................................................................................................................................. 31 11.12 40.13
The accompanying notes 1 to 41 are an integral part of the Financial Statements

}
In terms of our report attached.
Nadir B. Godrej Anand G. Mahindra Executive Chairman
For B S R & Co. LLP M. M. Murugappan
Chartered Accountants Dr. Vishakha N. Desai Dr. Pawan Goenka Managing Director and CEO
Firm’s Registration No : 101248W/W-100022 Vikram Singh Mehta Dr. Anish Shah Deputy Managing Director and Group CFO
T. N. Manoharan Directors
Jamil Khatri Vijay Kumar Sharma Rajesh Jejurikar Executive Director (Auto and Farm Sectors)
Partner Haigreve Khaitan
Membership No : 102527 Narayan Shankar Company Secretary
Shikha Sharma
Mumbai, 12th June, 2020 CP Gurnani Mumbai, 12th June, 2020
Statement of Changes in Equity | for the year ended 31st March, 2020
238

(A) Equity Share Capital

Rupees crores
COMPANY

2020 2019
OVERVIEW

Issued, Subscribed and Paid-up:

Balance as at the beginning of the year................................................ 595.80 594.97
REPORT
BOARD’S

Add: Allotment of shares by ESOP Trust to Employees........................ 0.72 0.83

Balance as at the end of the year........................................................... 596.52 595.80

(B) Other Equity

AND ANALYSIS

Rupees crores
Reserves and Surplus Items of other comprehensive income Total
Capital Securities General Debenture Share Option Retained Debt Equity Effective
MANAGEMENT DISCUSSION

Reserve Premium Reserve Redemption Outstanding Earnings instrument instrument portion of

(refer note a) (refer note b) Reserve Account through Other through Other Cash Flow
Comprehensive Comprehensive Hedges
Income Income [Note 35.1.(c)]

As at 1st April, 2018........................................ 346.00 2,160.94 1,730.45 36.26 229.33 25,205.82 (0.79) (4.44) (4.50) 29,699.07
CORPORATE
GOVERNANCE

Profit for the year........................................... — — — — — 4,796.04 — — — 4,796.04

Other Comprehensive Income/(Loss)............. — — — — — (8.85) 1.22 (0.73) 20.71 12.35

— — — — — 4,787.19 1.22 (0.73) 20.71 4,808.39

REPORT

Total Comprehensive Income for the year...

Dividend paid on Equity Shares (including

tax thereon)................................................... — — — — — (1,011.92) — — — (1,011.92)

Transfers from retained earnings.................. — — — 14.38 — (14.38) — — — —

BUSINESS RESPONSIBILITY

Exercise of employee stock options.............. — 89.79 — — (89.79) — — — — —

Allotment of shares by ESOP Trust to

Employees....................................................... — 23.83 — — — — — — — 23.83
ACCOUNTS

Allotment of bonus shares by ESOP Trust to

STANDALONE

Employees....................................................... — (0.41) (0.04) — — — — — — (0.45)

On account of employee stock options

lapsed.............................................................. — — 0.13 — (0.13) — — — — —
ACCOUNTS

Share based payment to employees............. — — — — 94.51 — — — — 94.51

CONSOLIDATED

st
As at 31 March, 2019.................................... 346.00 2,274.15 1,730.54 50.64 233.92 28,966.71 0.43 (5.17) 16.21 33,613.43
(B) Other Equity (contd.)
Rupees crores
Reserves and Surplus Items of other comprehensive income Total
Capital Securities General Debenture Share Option Retained Debt Equity Effective
Reserve Premium Reserve Redemption Outstanding Earnings instrument instrument portion of
(refer note a) (refer note b) Reserve Account through Other through Other Cash Flow
Comprehensive Comprehensive Hedges
Income Income [Note 35.1.(c)]
As at 1st April, 2019........................................ 346.00 2,274.15 1,730.54 50.64 233.92 28,966.71 0.43 (5.17) 16.21 33,613.43
Profit for the year........................................... — — — — — 1,330.55 — — — 1,330.55
Other Comprehensive Income/(Loss)............. — — — — — (7.93) 0.57 (0.78) (23.96) (32.10)
Total Comprehensive Income for the year... — — — — — 1,322.62 0.57 (0.78) (23.96) 1,298.45
Dividend paid on Equity Shares (including
tax thereon)................................................... — — — — — (1,187.33) — — — (1,187.33)
Exercise of employee stock options.............. — 87.87 — — (87.87) — — — — —
Allotment of shares by ESOP Trust to
Employees....................................................... — 25.93 — — — — — — — 25.93
Allotment of bonus shares by ESOP Trust to
Employees....................................................... — (0.36) — — — — — — — (0.36)
On account of employee stock options
lapsed.............................................................. — — 2.29 — (2.29) — — — — —
Share based payment to employees............. — — — — 121.20 — — — — 121.20
As at 31st March, 2020.................................... 346.00 2,387.59 1,732.83 50.64 264.96 29,102.00 1.00 (5.95) (7.75) 33,871.32
Remeasurement loss (net) on defined benefit plans Rs. 7.93 crores (2019: Rs. 8.85 crores) has been recognised during the year as part of retained earnings.
(C) Description of the nature and purpose of Other Equity:
(i) Capital reserve: Capital reserve mainly represents the amount of net assets acquired over and above consideration paid consequent to the Scheme of Arrangement.
(ii) Securities premium: Securities premium reserve is used to record the premium on issue of shares. The fair value of employee stock options is recognised in Securities Premium once the shares have been allotted
on exercise of the options.
(iii) General reserve: The General reserve comprises of transfer of profits from retained earnings for appropriation purposes. The reserve can be distributed/utilised by the Company in accordance with the Companies
Act, 2013.
(iv)  Debenture redemption reserve: Debenture redemption reserve is a statutory reserve (as per Companies Act, 2013) created out of profits of the Company available for payment of dividend for the purpose of
redemption of Debentures issued by the Company. On completion of redemption, the reserve is transferred to retained earnings.
(v)  Share option outstanding account: Share option outstanding account represents reserve in respect of equity settled share options granted to the Company’s employees in pursuance of the Employee Stock Option
Plan.
Notes:
(a) The Company has reduced the share capital by Rs. 12.54 crores (2019: Rs. 12.90 crores) and securities premium by Rs. 204.78 crores (2019: Rs. 230.71 crores) for the 2,50,76,433 shares of Rs. 5 each (2019: 2,58,02,706
shares of Rs. 5 each) held by the ESOP Trust pending transfer to the eligible employees.
(b) The share capital of the Company has also been reduced and the securities premium increased by Rs. 12.54 crores (2019: Rs. 12.90 crores) for the 2,50,76,432 bonus shares of Rs. 5 each (2019: 2,58,02,706 bonus
shares of Rs. 5 each) issued by the Company in December, 2017 to the ESOP Trust but not yet transferred by the ESOP Trust to the employees.
The accompanying notes 1 to 41 are an integral part of the Financial Statements.

In terms of our report attached.

Nadir B. Godrej Anand G. Mahindra Executive Chairman
For B S R & Co. LLP M. M. Murugappan
Chartered Accountants Dr. Vishakha N. Desai Dr. Pawan Goenka Managing Director and CEO
Firm’s Registration No : 101248W/W-100022 Vikram Singh Mehta Deputy Managing Director and Group CFO
Dr. Anish Shah
T. N. Manoharan Directors
Jamil Khatri Vijay Kumar Sharma Rajesh Jejurikar Executive Director (Auto and Farm Sectors)
Partner Haigreve Khaitan
INTEGRATED ANNUAL REPORT 2019-20
MAHINDRA & MAHINDRA LTD.

Membership No : 102527 Narayan Shankar Company Secretary

Shikha Sharma
Mumbai, 12th June, 2020 CP Gurnani
} Mumbai, 12th June, 2020
239
 COMPANY BOARD’S MANAGEMENT DISCUSSION CORPORATE BUSINESS RESPONSIBILITY STANDALONE CONSOLIDATED
240 OVERVIEW REPORT AND ANALYSIS GOVERNANCE REPORT ACCOUNTS ACCOUNTS

Cash Flow Statement | for the year ended 31st March 2020

Rupees crores
2020 2019

A. CASH FLOW FROM OPERATING ACTIVITIES:

Profit before exceptional items and tax............................................................................................................... 5,130.01 6,354.74
Adjustments for:
  Depreciation, amortisation and impairment expense..................................................................................... 2,222.63 1,860.40
  Loss/(gain) on foreign exchange fluctuations (net)......................................................................................... 16.48 (28.61)
  Dividend on investment and interest income.................................................................................................. (1,432.71) (1,318.44)
  Net gain/(loss) arising on financial assets measured at fair value.................................................................. 152.66 (115.84)
  Finance costs........................................................................................................................................................ 113.23 113.39
  Share based payment expenses......................................................................................................................... 114.50 89.20
  Gain on sale of current investments (net)........................................................................................................ (156.73) (87.55)
  Profit on property, plant and equipment sold/scrapped/written off (net).................................................... (73.90) (3.30)
Operating profit before working capital changes.............................................................................................. 6,086.17 6,863.99
Changes in:
  Trade and other receivables............................................................................................................................... 2,055.93 (660.74)
 Inventories........................................................................................................................................................... 438.36 (1,137.58)
  Trade and other payables and provisions......................................................................................................... (3,820.29) 1,292.34
(1,326.00) (505.98)
Cash generated from operations.......................................................................................................................... 4,760.17 6,358.01
Income taxes paid (net of refunds)....................................................................................................................... (1,082.34) (1,434.14)
NET CASH FLOW FROM OPERATING ACTIVITIES (A)........................................................................................... 3,677.83 4,923.87
B. CASH FLOW FROM INVESTING ACTIVITIES:
Payments to acquire property, plant and equipment and intangible assets.................................................... (3,991.93) (3,082.14)
Proceeds from sale of property, plant and equipment and intangible assets.................................................. 48.26 50.54
Payments to acquire non-current investments – subsidiaries............................................................................. (2,107.57) (2,558.96)
Payments to acquire non-current investments – associates................................................................................ (24.68) (34.45)
Payments to acquire non-current investments – joint ventures......................................................................... (142.88) (198.72)
Payments to acquire other non-current investments.......................................................................................... (33.46) (2.04)
Payments to acquire current investments............................................................................................................ (1,11,727.63) (1,44,592.65)
Proceeds from sale of current investments.......................................................................................................... 1,12,756.38 1,45,592.59
Share application money paid............................................................................................................................... (23.86) —
Bank deposits placed.............................................................................................................................................. (2,235.57) (1,733.25)
Bank deposits matured.......................................................................................................................................... 1,774.15 1,714.95
Interest received..................................................................................................................................................... 355.60 317.15
Dividends received.................................................................................................................................................. 1,007.35 889.27
Inter-corporate deposits given.............................................................................................................................. (804.06) (1,010.00)
Inter-corporate deposits refunded........................................................................................................................ 885.61 1,324.50
Exceptional Items:
Proceeds from sale of non current investments in subsidiaries, associate, joint ventures and capital
receipt from M&M Benefit Trust................................................................................................................... 1,688.57 774.50
NET CASH FLOW FROM INVESTING ACTIVITIES (B)............................................................................................. (2,575.72) (2,548.71)
 MAHINDRA & MAHINDRA LTD.
INTEGRATED ANNUAL REPORT 2019-20 241

Cash Flow Statement (contd.)

Rupees crores
2020 2019
C. CASH FLOW FROM FINANCING ACTIVITIES:
Proceeds from borrowings..................................................................................................................................... 1,312.42 1,048.28
Repayment of borrowings and lease liabilities.................................................................................................... (983.53) (1,420.81)
Dividends paid (including tax thereon)................................................................................................................ (1,187.37) (1,011.74)
Interest, commitment and finance charges paid................................................................................................. (156.98) (170.95)
NET CASH FLOW FROM FINANCING ACTIVITIES (C)............................................................................................ (1,015.46) (1,555.22)
NET INCREASE IN CASH AND CASH EQUIVALENTS (A+B+C).............................................................................. 86.65 819.94
Cash and cash equivalents at the beginning of the year.................................................................................. 2,237.58 1,417.95
Unrealised loss on foreign currency cash and cash equivalents......................................................................... (0.72) (0.31)
Cash and cash equivalents at the end of the year............................................................................................. 2,323.51 2,237.58
Note:
The above Cash Flow Statement has been prepared under the “indirect method” as set out in ‘Indian Accounting Standard (Ind AS) 7 – Statement
of Cash Flows’.
The accompanying notes 1 to 41 are an integral part of the Financial Statements.

}
In terms of our report attached.
Nadir B. Godrej Anand G. Mahindra Executive Chairman
For B S R & Co. LLP M. M. Murugappan
Chartered Accountants Dr. Vishakha N. Desai Dr. Pawan Goenka Managing Director and CEO
Firm’s Registration No : 101248W/W-100022 Vikram Singh Mehta Dr. Anish Shah Deputy Managing Director and Group CFO
T. N. Manoharan Directors
Jamil Khatri Vijay Kumar Sharma Rajesh Jejurikar Executive Director (Auto and Farm Sectors)
Partner Haigreve Khaitan
Membership No : 102527 Narayan Shankar Company Secretary
Shikha Sharma
Mumbai, 12th June, 2020 CP Gurnani Mumbai, 12th June, 2020