A Report on

Maruti Suzuki India Limited

Financial Management
Assignment 1

Submitted By:-
Shresth Tyagi 401906006
Chirag Vashishtha 401906033
Jayesh Khemchandani 401903019
Jayant Narayan 401903026

Submitted To:-
Dr. Sabin Panta
Associate Professor

Thapar Institute Of Engineering & Technology

SEPTEMBER 2022
Table Of Content

Board Composition of Maruti Suzuki 3

Board Member Qualities of Maruti Suzuki 4

Attendance at Board Meeting 5

Committees of the Board 6

1. Audit Committee 6

2. Stakeholders’ Relationship Committee 8

3. Nomination and Remuneration Committee 9

4. Corporate Social Responsibility Committee 10

5. Risk Management Committee 10

Workforce Diversity and Inclusion 11

Board Independence 12

Firm’s Performance 12

Conclusion 14
Board Composition
As of 31st March 2022, the Company’s board consists of twelve members. The
Chairman of the board is a Non-Executive Director. The Company has an optimum
combination of Executive and Non-Executive Directors in accordance with Regulation17
of SEBI. The board has three Executive Directors and nine Non-Executive Directors, of
whom four are Independent Directors.

Their composition is given below.

Sr no. Name of Director Designation

1 Mr R. C. Bhargava Chairman, Non-Executive

2 Mr Kenichi Ayukawa Executive Vice Chairman,

Executive

3 Mr Hisashi Takeuchi Managing Director & CEO,

Executive

4 Mr Shigetoshi Torii Joint Managing Director,

Executive

5 Mr Toshihiro Suzuki Director, Non-Executive

6 Mr Kenichiro Toyofuku Director (Corporate

Planning), Non-Executive

7 Mr Osamu Suzuki Director, Non-Executive

8 Mr Kinji Saito Director, Non-Executive

9 Mr D. S. Brar Independent Director

10 Mr R. P. Singh Independent Director

11 Mr Maheswar Sahu Independent Director

12 Ms Lira Goswami Independent Director

Except Mr O. Suzuki and Mr Toshihiro Suzuki who are related to each other, none of
the Directors is related to any other Director. All Independent Directors are persons of
eminence and bring a wide range of expertise and experience to the board thereby
ensuring the best interests of stakeholders and the Company.

Some of the expertise of board members is listed below.

Sr Name of Director Designation Expertise
no.

1 Mr R. C. Bhargava Chairman, Non-Executive IAS, Master in Mathematics,

Master of Arts in
Developmental Economics

2 Mr Kenichi Ayukawa Executive Vice Chairman, A Law graduate

Executive

3 Mr Hisashi Takeuchi Managing Director & CEO, Economics, the experience

Executive of over 33 years

4 Mr Shigetoshi Torii Joint Managing Director, Mechanical Engineering,

Executive Production and Supply
Chain

5 Mr Toshihiro Suzuki Director, Non-Executive Science And Technology

6 Mr Kenichiro Toyofuku Director (Corporate Economy, Trade & Industry

Planning), Non-Executive

7 Mr Osamu Suzuki Director, Non-Executive Faculty of Law,

Policymaking

8 Mr Kinji Saito Director, Non-Executive Economics, Global

Marketing

9 Mr D. S. Brar Independent Director Electrical Engineering, MBA

10 Mr R. P. Singh Independent Director Post Graduate in

Mathematics

11 Mr Maheswar Sahu Independent Director Large Scale Project

Management, Public Sector
Undertaking Management

12 Ms Lira Goswami Independent Director Foreign Investment,

Defence Procurement,
trade, legal support
Attendance at Board Meeting and Last annual Annual General Meeting(AGM)

The board met seven times during the year. The board meets at least four times a year
with a maximum gap of one hundred and twenty days between any two meetings.
Additional meetings are held, whenever necessary.

Below is the attendance record of the Directors at the board meetings as well as the last
annual general meeting (AGM).

Sr no. Name of Director Number of Board Whether attended

Meetings attended last AGM
(Total meetings
held: 7)

1 Mr R. C. Bhargava 7 Yes

2 Mr Kenichi Ayukawa 7 Yes

3 Mr Hisashi Takeuchi 7 Yes

4 Mr Shigetoshi Torii 7 Yes

5 Mr Toshihiro Suzuki 5 Yes

6 Mr Kenichiro Toyofuku 7 Yes

7 Mr Osamu Suzuki 5 Yes

8 Mr Kinji Saito 7 Yes

9 Mr D. S. Brar 7 Yes

10 Mr R. P. Singh 7 Yes

11 Mr Maheswar Sahu 7 Yes

12 Ms Lira Goswami 6 Yes

Committees of the Board

1. Audit Committee: All the members of the audit committee are financially literate
and Mr D. S. Brar, the Chairman, has expertise in accounting and financial
management. The Chairman attended the last annual general meeting to answer
shareholders’ queries. Here is the Audit Composition.

Name of Director Category Designation Number of

meetings
attended(out of 7)

Mr D. S. Brar Independent Chairperson 7

Ms Lira Goswami Independent Member 7
Mr R. P. Singh Independent Member 7
Mr Maheswar Sahu Independent Member 7
The role/terms of reference of the audit committee include the following:
1. Oversight of the Company’s financial reporting process and the disclosure of
its financial information to ensure that the financial statements are correct,
sufficient and credible.
2. Recommending the appointment, remuneration and terms of appointment of
the auditors of the Company.
3. Approval of payment to statutory auditors for any other services rendered by
the statutory auditors.
4. Reviewing, with the management, the annual financial statements and
auditors’ report before submission to the board for approval, with particular
reference to
a) Matters required to be included in the Directors’ responsibility
statement to be included in the board’s report in terms of clause (c) sub-section
(3) of Section 134 of the Companies Act, 2013.
b) Changes, if any, in accounting policies and practices and reasons for
the same.
c) Major accounting entries involving estimates based on the exercise of
judgment by the management.
d) Significant adjustments made in the financial statements arising out of
audit findings.
e) Compliance with listing and other legal requirements relating to financial
statements.
f) Disclosure of any related party transactions.
g) Qualifications in the draft audit report.
5. Reviewing, with the management, the quarterly financial statements before
submission to the board for approval.
6. Reviewing, with the management, the statement of uses/ application of funds
raised through an issue (public issue, rights issue, preferential issue, etc.), the
statement of funds utilised for purposes other than those stated in the offer
document/prospectus/ notice and the report submitted by the monitoring agency
monitoring the utilisation of proceeds of a public or rights issue, and making
appropriate recommendations to the Board to take steps in this matter.
7. Review and monitor the auditors’ independence and performance, and
effectiveness of the audit process.
8. Approval of transactions of the Company with related parties and any
subsequent modification of such transactions.
9. Scrutiny of inter-corporate loans and investments.
10. Valuation of undertakings or assets of the Company, wherever it is
necessary.
11. Evaluation of internal financial controls and risk evaluation and mitigation
systems.
12. Reviewing with the management the performance of statutory and internal
auditors, and adequacy of the internal control systems.
13. Reviewing the adequacy of the internal audit function including the structure
of the internal audit department, staffing and seniority of the official heading the
department, reporting structure, coverage and frequency of internal audit.
14. Discussions with internal auditors of any significant findings and follow-up
thereon.
15. Reviewing the findings of any internal investigations by the internal auditors
into matters where there is suspected fraud or irregularity or a failure of internal
control systems of material nature and reporting the matter to the board.
16. Discussion with statutory auditors before the audit commences, about the
nature and scope of audit as well as post-audit discussion to ascertain and
resolve any areas of concern.
17. To look into the reasons for substantial defaults, if any, in the payment to the
depositors, debenture holders, shareholders (in case of non-payment of declared
dividends) and creditors.
18. To review the functioning of the whistle-blower mechanism.
19. Approval of appointment of the Chief Financial Officer after assessing the
qualifications, experience and background, etc. of the candidate.
20. Carrying out any other function as is mentioned in the charter of the audit
committee.
2. Stakeholders Relationship Committee: The table given below shows the
composition of the Stakeholders’ Relationship Committee and the details of
attendance. Mr R. C. Bhargava, the Chairman attended the last annual general
meeting to address shareholders’ queries.

Name of Director Category Designation Number of

meetings
attended(out of 1)

Mr R. C. Bhargava Non-Executive Chairperson 1

Mr D. S. Brar Independent Member 1
Mr Kenichi Executive Member 1
Ayukawa

Mr Hisashi Executive Member 1

Takeuchi
Objective:
The committee oversees redressal of shareholders’ and investors’ grievances,
transfer of shares, non - receipt of the annual report, non - receipt of declared
dividends and related matters. The committee also oversees the performance of
the registrar and transfer agent, recommends measures for overall improvement
in the quality of investors’ services, approves the issue of
duplicate/split/consolidation of share certificates and reviews all matters
connected with the securities’ transfers.
In order to provide efficient and timely services to the investors, the board has
delegated the power of approval of issue of duplicate/split/consolidation of share
certificates, transfer of shares, the transmission of shares,
dematerialisation/rematerialisation of shares not exceeding 2000 equity shares
per transaction to the Managing Director and Company Secretary severally
3. Nomination and Remuneration Committee (NRC): The table below shows the
composition of the Nomination and Remuneration Committee and the details of
attendance.

Name of Director Category Designation Number of

meetings
attended(out of 3)

Mr D. S. Brar Independent Chairperson 3

Mr R. C. Bhargava Non-Executive Member 3
Ms Lira Goswami Independent Member 3
Mr Maheswar Sahu Independent Member 3
The role/terms of reference of the NRC include the following:
1. Identify persons who are qualified to become Directors and who may be
appointed in senior management and recommend to the board their appointment
and removal.
2. Formulate criteria for evaluation for the performance of every Director and the
board as a whole.
3. Formulate the criteria for determining qualification, positive attributes and
independence of a Director and devising a policy on board diversity.
4. Recommend to the board a remuneration policy applicable to Directors, key
managerial personnel and other employees.
5. Ensure that –
a) The level and composition of remuneration is reasonable and sufficient
to attract, retain and motivate Directors of the quality required to run the
Company successfully;
b) Relationship of remuneration to performance is clear and meets
appropriate performance benchmarks;
c) Remuneration to Directors, key managerial personnel and senior
management involves a balance between fixed and incentive pay reflecting short
and long-term performance objectives appropriate to the working of the Company
and its goals;
d) Any other action as may be required under the Companies Act, 2013
and any amendment thereto, Listing Regulation and guidelines/circular issued by
the Securities and Exchange Board of India from time to time.
4. Corporate Social Responsibility Committee (CSR): The table below shows
the composition of the Corporate Social Responsibility Committee and the details
of attendance.

Name of Director Category Designation Number of

meetings
attended(out of 2)

Mr R. C. Bhargava Non-Executive Chairperson 2

Mr Kenichi Executive Member 2
Ayukawa

Mr Hisashi Executive Member 2

Takeuchi

Mr R. P. Singh Independent Member 2

The role/terms of reference of the CSR include the following:
1. To frame the CSR policy and its review from time-to-time.
2. To ensure effective implementation and monitoring of the CSR activities as per
the approved policy, plans and budget.
3. To ensure compliance with the law, rules and regulations governing the CSR
and to periodically report to the Board of Directors.
5. Risk Management Committee (RMC): An Executive Risk Management
Committee (ERMC) is in place at the management level to review the risk
management activities of the Company on a regular basis. Below is the
composition of the RMC.

Name of Director Category Designation

Mr R. C. Bhargava Independent Chairperson

Mr Kenichi Ayukawa Executive Member
Mr Hisashi Takeuchi Executive Member
Mr Maheswar Sahu Independent Member
Mr Shigetoshi Torii Executive Member
Mr Kenichiro Toyofuku Executive Member
Mr Ajay Seth Chief Financial Officer Member
Mr Rajiv Gandhi Sr. Financial Officer Member
Roles and Responsibilities of the RMC:
 1. Preparation of a charter/policy on risk assessment and minimisation and
mitigation process;
2. Preparation and review of a risk library; and
3. Monitoring and reviewing risk management and mitigation plan.

Workforce Diversity and Inclusion

The Suzuki Group Code of Conduct, which applies to all those working in the Suzuki
Group, addresses to make a workplace that does not have any discrimination or
harassment due to gender, age, nationality, race, religion, belief, etc. Variety of
human resources regardless of gender, age and nationality are active in various
departments.

FY2018 FY2019 FY2020

Male 13,808 13,932 14,220

Employees Female 1,623 1,714 1,853

Total 15,431 15,646 16,073

Male 4,339 4,403 4,577

Of which with
Job titles Female 98 115 133

Total 4,437 4,518 4,710

Male 1,066 1,121 1,185

Of which
managers Female 14 19 19

Total 1,080 1,140 1,204

In order to further realize workplace where women can demonstrate their abilities and
work successfully from FY2020, the Company will raise “increase in number of female
employees with job titles” and “promotion to take paid holiday” for building better
working environment.Based on these issues, the Company will target to “triple the
number of female employees with job titles in 2025 compared to FY2015, before the Act
on the Promotion of Female Participation and Career Advancement in the Workplace
was enforced” as well as to “improve rate of paid holiday taken by all employees
including managers by 10% compared to FY2018 in 2025”.
Board Independences
 1. You shall at the first meeting of the Board in which you participate as an independent
director and thereafter at the first meeting of the Board in every financial year or as
and when there is a change in circumstances, which may affect your status as an
independent director, submit a declaration to the Board that you meet the criteria of
independence specified under Section 149(6) of the Act.
2. You shall disclose any direct or indirect interest, which you may have in any matter
being considered at a board meeting or committee meeting and, save as permitted
under the Articles of Association of the Company, you shall not vote on any
resolution of the Board, or of any of its committees, on any matter where you have
any direct or indirect interest.
3. Unless specifically authorised to do so by the Board, you shall not enter into any
legal or other commitment or contract on behalf of the Company.
4. You shall not hold office
5. (1) as a director (including as an alternate director) in more than twenty companies
at the same time;
6. (2) as a director in more than ten public companies at the same time; and
7. (3) as an independent director in more than seven listed companies at the same time
(provided however, that in case you hold office as a whole time director in a listed
company then you shall not hold office as an independent director in more than three
listed companies).

Firm’s Performance

A firm’s performance can be effectively measured by its stock price, market

capitalization, ROE, ROA, etc. For Maruti Suzuki, the metrics are as follows-

Stock Price - 8922.00 INR (As of 12 Sept, 3:30 pm IST)

As on 12 Sep, 2022, Maruti Suzuki share price was down by 0.27% based on the
previous closing price of Rs 8946. Maruti Suzuki share price was Rs 8922. Return
Performance of Maruti Suzuki Shares:

● 1 Week: Maruti Suzuki share price moved up by 0.30%

● 1 Month: Maruti Suzuki share price moved up by 1.76%

● 3 Month: Maruti Suzuki share price moved up by 14.95%

● 6 Month: Maruti Suzuki share price moved up by 26.68%

Therefore, in terms of stock price and its historical growth, it is safe to say that the
performance of Maruti Suzuki is strong.

Market Capitalization- Within the Auto sector, Maruti Suzuki stock has a market
cap rank of 1. Maruti Suzuki has a market cap of Rs 269697 Cr.

Therefore, in terms of market capitalization as well, Maruti’s performance is strong.

ROE(Return On Equity)- Maruti Suzuki's annualized ROE% for the quarter that ended
in jun 2022 was 7.31% . The average ROE% of this sector is 5.55%.

During the past 13 years, Maruti Suzuki India's highest ROE % was

ROE of automobile companies

Company Name ROE
Maruti Suzuki Ltd 8.32
Mahindra &Mahindra Ltd 14.97
Tata Motors Ltd -25.24

Bajaj auto 21.96

Eicher Motors 17.28
Hero Motocorp 16.93

22.19%.. The lowest was 7.20. And the median was 15.13%

Using the above stats we can conclude, in terms of ROE, Maruti is Decent

ROA(Return On Assets)- Maruti Suzuki's annualized ROA % for the quarter that ended
in June 2022was 5.553% average ROA% of this sector is 3.87% (5 Yrs).
During the past 13 years, Maruti Suzuki India's highest ROA % was 15.86%. The lowest
was 5.31%. And the median was 10.46%.

ROA of automobile companies

Company Name ROA

Maruti Suzuki Ltd 6.23

Mahindra &Mahindra Ltd 3.90

Tata Motors Ltd -3.46

Bajaj auto 18.08

Eicher Motors 13.62

Hero Motocorp 11.23

Using the above stats we can conclude, in terms of ROA, Maruti is DECENT.

Conclusion

Maruti Suzuki India Limited is one of the largest automobile manufacturers in India. It is
fully committed to practising sound corporate governance and upholding the highest
business standards in conducting business. Being a value-driven organisation, the
Company has always worked towards building trust with shareholders, employees,
customers, suppliers and other stakeholders based on the principles of good corporate
governance, viz., integrity, equity, transparency, fairness, disclosure, accountability and
commitment to values. According to the findings of our study, Maruti Suzuki India
Limited comply with all the conditions of corporate governance as stipulated in the SEBI
listing regulations. According to the analysis of the Board and Firm’s performance, we
can speculate the company has generated decent returns. Additionally, the number of
financial ratios suggests that the company has shown steady, sustainable and moderate
growth as compared to its competitors.