Director Report

Dear Shareholders

Your Directors present their Report together with the audited financial statements of your Company for the year ended 31^st March, 2023.

A. FINANCIAL AND OPERATIONAL HIGHLIGHTS

(Rs. in crores)

$ For details refer to 'Statement of Changes in Equity' in the Standalone Financial Statements and 'Consolidated Statement of Changes in Equity' in the Consolidated Financial Statements respectively forming part of the Annual Report.

The Financial Year 2023 was a year of uncertainty, recovery and economic resilience for India. Even as India looked beyond the pandemic, elevated uncertainty due to geopolitical tensions and a war in Ukraine set the tone even before the fiscal year started. The war resulted in higher global supply-chain-related disruptions and fuelled global inflationary forces, which seeped into the domestic consumption basket. Oil breached USD 120 / barrel of crude oil mark, and industrial metal prices soared in the first quarter.

Higher inflation forced major central banks to firefight inflation with an ultra-hawkish policy stance. While the faster-than-normal pace of monetary policy tightening resulted in the peaking of inflationary forces, it also raised headwinds to global growth. A stronger dollar resulting from US Federal Reserve's policy tightening and higher commodity prices accentuated external difficulties for emerging economies including India. The RBI also hiked rates aggressively to combat domestic inflationary pressures in line with the global monetary policy cycle.

Global growth lost momentum as monetary policy actions tightened financial conditions and consumer confidence weakened with the rising cost of livelihood. Inflation remained elevated and persistent across countries as they grappled with food and energy price shocks and shortages. Yet, India's economic resilience stands out with the first advance estimates (FAE) released by the National Statistical Office (NSO), placing India's real gross domestic product (GDP) growth at 7% year-on-year (y-o-y) for FY23, driven by private consumption and investment.

The Profit for the year before Depreciation, Finance Costs, Exceptional items and Taxation recorded an increase of 43.01% at Rs. 12,987.56 crores as against Rs. 9,081.22 crores in the previous year. Profit after tax increased by 34.47% at Rs. 6,548.64 crores as against Rs. 4,869.88 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.

Earnings Per Share (EPS)

The Standalone basic EPS of the Company stood at Rs. 54.70 for the Financial Year ended 31^st March, 2023 as against Rs. 40.73 for the Financial Year ended 31^st March, 2022 and Diluted EPS stood at Rs. 54.49 as against Rs. 40.58 in the previous year.

Details of Material Changes from the end of the Financial Year till the date of this Report

No material changes and commitments have occurred after the closure of the Financial Year 2022-23 till the date of this Report, which would affect the financial position of your Company.

Performance Review

I Automotive Sector

Your Company's Automotive Sector posted total sales of 6,98,456 vehicles (6,39,374 Passenger vehicles, commercial vehicles and 59,082 three-wheelers) as against a total of 4,65,601 vehicles (4,35,086 four-wheelers and 30,515 three- wheelers) in the previous year, registering a growth of 50%.

In the domestic market, your Company sold a total of 6,66,349 vehicles as compared to 4,33,091 vehicles in the previous year, resulting in a growth of 53.9%.

In the Passenger Vehicle (PV) segment, your Company sold 3,59,253 vehicles [including 3,56,961 Utility Vehicles (UVs), 2,078 Vans and 214 Cars] as compared to the previous year's volume of 2,25,895 vehicles [including 2,23,682 Utility Vehicles (UVs), 2,154 Vans and 59 Cars] registering a growth of 59%.

In the Commercial Vehicle (CV) segment, your Company sold 2,48,576 vehicles [including 40,419 vehicles <2T GVW, 1,98,121 vehicles between 2-3.5T GVW, 1,959 Light Commercial Vehicles (LCVs) in the LCV > 3.5T segment, 1,657 vehicles in the 7.5- 16.2T GVW segment, 4,742 Heavy Commercial Vehicles (HCVs) and 1,678 LCV Passenger] registering a growth of 40.3% over the previous year's volume of 1,77,117 vehicles [including 32,039 vehicles < 2T GVW, 1,38,643 vehicles between 2-3.5T GVW, 1,891 Light Commercial Vehicles (LCVs) in the LCV > 3.5T segment, 1,135 vehicles in the 7.5-16.2T GVW segment and 3,409 Heavy Commercial Vehicles (HCVs)].

In the three-wheeler segment, your Company sold 58,520 three-wheelers, registering a growth of 94.6% over the previous year's volume of 30,079 three-wheelers.

For the year under review, the Indian automotive industry (except 2W) grew by 32%, with the PV industry growth of 26.7% and CV industry growth of 34.3%. The UV segment showed growth of 34.5%. Within the CV industry, the LCV goods <3.5T segment grew by 23.9% while the Medium and Heavy Commercial Vehicles (MHCV) Segment grew by 40.1%.

Your Company's UV volumes stood at 3,56,961 units, a growth of 59.6%. The UV market share for your Company stood at 17.8%. For the year under review, the Scorpio-N launched in June 2022, performed well in the UV segment with a volume of 35,112 units for the Financial Year 2023. It garnered 1 lakh bookings within 30 minutes of opening of booking window. XUV700, Thar, Scorpio, XUV300 and Bolero continued to be strong brands for your Company in the UV segment.

In the LCV<3.5T segment, your Company retained its No. 1 position with 45.5% market share. Your Company sold a total of 2,38,540 vehicles in this segment. Your Company has a market share of 59.8% in the LCV 2-3.5T segment, which is the Pickup segment.

In the MHCV Segment, your Company sold 6,399 trucks as against 4,544 trucks in the previous year. This is a growth of 40.8%. Your Company's market share in the MHCV segment stands at 2%.

Your Company is the pioneer for Electric Vehicles (EVs) in India, and for the year under review, sold 46,109 EVs as against 17,006 EVs in the previous year.

During the year under review, your Company posted an export volume of 32,107 vehicles as against the previous year's exports of 32,510 vehicles representing a de-growth of 1.2%.

The sales of spare parts for the year stood at Rs. 3,824.26 crores (including exports of Rs. 396.51 crores) as compared to Rs. 2,859.2 crores (including exports of Rs. 235.2 crores) in the previous year, registering a growth of 33.8%.

I Farm Equipment Sector

Your Company's Farm Equipment Sector recorded total sales of 4,07,545 tractors (domestic + export) as against 3,54,698 tractors sold in the previous year. These figures for the current year sales and previous year sales include tractors sold under the Trakstar brand, which is the third brand of your Company under the subsidiary Gromax Agri Equipment Limited.

For the year under review, the tractor industry in India recorded sales of 9,45,311 tractors, a growth of 12.2%. Tractor Industry recorded growth in Financial Year 2023 on account of record crop output, Government support (MSP), increase in wages and shift of Navratri in Q4 F23.

In the domestic market, your Company sold 3,89,531 tractors, as compared to 3,37,052 tractors in the previous year (these figures for the current year sales and previous year sales include tractors sold by Gromax Agri Equipment Limited), recording a growth of 15.6%. It is the highest ever volume sold by your Company. With market share at 41.2%, a gain of 1.2% over previous year, the Company continues to be the market leader for the 40^th consecutive year. Your Company's performance was supported by good performance of all products in the portfolio.

Your Company continues to focus on growing the farm mechanisation space, by offering affordable mechanisation solutions. The portfolio comprises of Rotavators, Cultivators, Harvesters, Rice transplanters, Balers and Sprayers.

For the year under review, your Company exported 18,014 tractors which is a growth of 2.1% over the previous year.

Net Sales of Spare parts for the Financial Year 2023 stood at Rs. 1,070.5 crores (including exports of Rs. 97.4 crores) as compared to Rs. 917 crores (including exports of Rs. 81 crores) in the previous Financial Year 2022, registering a growth of 16.7%.

Please refer to the paragraph on Operating Results in the Management Discussion & Analysis section for detailed analysis.

Other Businesses

I Powerol

Under the Powerol brand, your Company has been a leader in providing power back-up solutions to the telecom industry for more than 15+ years of operation. Your Company continues to consolidate its presence in the tele-infra management space. Alongside the Telecom, Powerol has been increasing the Retail market share, especially with the extension in HkVA range. With the introduction of CPCB 4+ for gensets, Powerol is gearing up for the transition.

Powerol stands at No. 2 brand by volume in the overall Diesel Genset power back-up segment.

Powerol's move towards sustainability has led to the introduction of the Gas Powered gensets with introduction of 5 nodes between 15 kVA to 315 kVA. They offer lower operating costs and low emissions complying to the new emission norms. During the year, Powerol has also initiated EV Charger business for Home Charger Installations for the EV customers of the Company.

I Construction Equipment

For the year under review, your Company (under the Mahindra EarthMaster brand) sold 989 Backhoe Loaders (BHLs), a 35.7% increase as against 729 sold in the Financial Year 2021-2022. Your Company also has a presence in the road construction equipment business through motor graders (under the Mahindra RoadMaster brand).

For the year under review, your Company sold 188 motor graders, a 60.7% increase as against 117 sold in the Financial Year 2021-2022. Your Company also has a presence in the Sugar Cane Haulage market (under the Mahindra HaulMaster brand) in the export market. For the year under review, your Company sold 247 Haulage Tractors, a 135.2% increase as against 105 sold in the Financial Year 2021-2022. The BHL industry grew by 28% and the motor grader industry grew by 42% due to increased focus from the Government of India on infrastructure.

I Two-Wheeler Business

In line with the strategy for the two-wheeler business, your Company through its subsidiary, Classic Legends Private Limited ("CLPL") had reintroduced the iconic brand 'Jawa' to the Indian market in the Financial Year 2019, with the launch of new range of JAWA motorcycles - Jawa and Jawa Forty-Two and strengthened its portfolio by adding Yezdi in the Financial Year 2021-22. During Financial Year 2022-23, 42 Bobber was introduced to the Indian market and in addition, CLPL forayed into the international market by introducing iconic British brand BSA in UK and European market.

Current Year's review

During the period 1^st April, 2023 to 25^th May, 2023, 1,08,013 vehicles were produced as against 89,041 vehicles and 1,03,410 vehicles were dispatched as against 74,605 vehicles dispatched during the corresponding period in the last year. During the same period 62,235 tractors were produced and 60,435 tractors dispatched as against 61,268 tractors produced and 60,977 tractors dispatched during the corresponding period in the previous year.

The high-interest rate environment has exposed the underlying fault lines of the global economy and the financial system, which has now widened further due to multiple shocks ranging from the pandemic and continuing war in Ukraine. With instances of bank runs amid a loss of confidence and liquidity woes in the advanced economies of the US and Europe, growth and liquidity concerns are back to the fore as central banks continue their pursuit of a 'soft landing'.

Back home, the sustained focus on capital and infrastructure spending in the Union Budget 2023-24 along with continuing fiscal consolidation and strong credit growth creates space for private investment and supports domestic economic activity. However, there are early forecasts of a probable El Nino and external demand is likely to be dented by a slowdown in global activity. Taking all these factors into consideration, the RBI projects real GDP growth for 2023-24 at 6.4%.

Finance

Financial Year 2022-23 saw the global outlook deteriorating markedly as inflation across the world surged to levels not seen for generations and the rising cost of living hit consumer confidence. As soaring food and energy prices threatened to trigger a global crisis, central banks around the world responded by aggressive monetary tightening and increased interest rates in the fastest and most synchronized tightening cycles on record. Due to the aggressive interest rate hikes, easing of global supply chain bottlenecks and lower commodity prices, global headline inflation is set to fall from 8.7% in 2022 to 7.0% in 2023 (IMF estimates), however inflation is expected to remain well above central bank target levels till 2025 in most countries.

Record high interest rates and a resurgence of COVID-19 in China weighed on global growth during the financial year. Tentative signs in 2023 show that the world economy could achieve a soft landing. As per International Monetary Fund ("IMF"), global growth is expected to fall from 3.4% in 2022 to 2.8% in 2023 with advanced economies expecting to see an especially pronounced growth slowdown, from 2.7% in 2022 to 1.3% in 2023. Side-effects from the fast rise in policy rates in the form of banking turmoil in the US and Europe and the accompanying financial stability concerns weigh on the outlook going forward.

In the currency markets, the US dollar hit a two-decade high with the dollar index touching 112 in September 2022. The US dollar has since weakened against most currencies. Volatility impacted emerging market currencies in an environment of risk aversion, safe haven demand and correction in global equity markets.

In contrast, domestic financial markets evolved in an orderly manner. India's economic activity exhibited resilience with GDP growth for FY 2022-23 pegged at 7%, driven by private consumption and investment. Consumer price index inflation (CPI) persisted at elevated levels during the year, impacted by a series of adverse supply shocks and the continuing pass-through of high input costs. The RBI Monetary Policy

Committee increased the policy repo rate by 250 bps during May 2022-February 2023 taking the policy Repo rate to 6.5%. RBI also sucked out liquidity from the system with the system liquidity falling from Rs. 7.8 lakh crore in April, 2022 to Rs. 1.4 lakh crores in March, 2023. Money market rates and short-term bond yields hardened in tandem with policy rate increases and tightness in liquidity, while long term bond yields were largely range-bound. CPI has since eased substantially and is well within RBI's medium-term 4+/- 2% target.

The Indian rupee (INR) depreciated vis-a-vis the US dollar buffeted by global spillovers. The INR touched an all-time low of 83.2 during October, 2022 but has recovered since then on a depreciating US dollar and net inflows through foreign portfolio investments. India's foreign exchange reserves were placed at US$ 578.4 billion as on 31^st March, 2023.

Amidst the aforesaid backdrop, the Bankers continue to rate your Company as a prime customer and extend facilities / services at prime rates. Your Company follows a prudent financial policy and aims not to exceed an optimum financial gearing at any time. The Company's gross Debt to Equity Ratio is 0.11 as at 31^st March, 2023. Further, 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 repaid total borrowings of Rs. 1,861.43 crores whilst maintaining an optimum liquidity level of Rs. 14,410 crores as at 31^st March, 2023.

Further, your Company has been rated by CRISIL Ratings Limited ("CRISIL"), ICRA Limited ("ICRA"), India Ratings and Research Private Limited ("India Ratings") and CARE Ratings Limited ("CARE") for its Banking facilities. All have re-affirmed the highest credit rating for your Company's Short-Term facilities. For Long Term facilities and Non-Convertible Debentures, CRISIL, ICRA, CARE and India Ratings have re-affirmed their credit ratings of CRISIL AAA/Stable, [ICRA]AAA (stable), CARE AAA; Stable, and IND AAA/Stable for the respective facilities rated by them. With the above rating affirmations, your Company continues to enjoy the highest level of rating from all major rating agencies at the same time.

The AAA ratings indicate highest degree of safety regarding timely servicing of financial obligations and is also a vote of confidence reposed in your Company's Management by the rating agencies. It is an acknowledgement of the strong credit profile of your Company over the years, resilience in earnings despite cyclical upturns / downturns, robust financial flexibility arising from the significant market value of its holdings and prudent management.

Your Company is a "Large Corporate" as per the criteria under Securities and Exchange Board of India ("SEBI") Operational Circular No. SEBI/HO/DDHS/P/CIR/2021/613 dated 10^th August, 2021, as amended from time to time. The Company has complied with the provisions of the said Circular and has made requisite disclosures in this regard.

Redemption of Non-Convertible Debentures

Subsequent to the year end, your Company has redeemed the following Unsecured Listed, Rated Redeemable NonConvertible Debentures ("NCDs") issued on private placement basis on the due dates, as per the respective terms of issue:

Further, your Company has on 4^th May, 2023 received Notices from the Holders of M&M 6.19% NCDs (500 Debentures of Rs. 10,00,000 each aggregating Rs. 500 crores) [ISIN: INE101A08112] exercising Put Option to redeem the aforesaid Debentures as per the terms and conditions of the issue. The Company whilst acknowledging the receipt of Put Option Notices from all the Debenture Holders informed them that the aforesaid Debentures would be redeemed on 8^th June, 2023 (being Put Option date) prior to Maturity along with accrued Interest.

Investor Relations (IR)

Your Company always believes in leading from the front with emerging best practices in IR and building a relationship of mutual understanding with domestic and foreign investors/ analysts. In the Financial Year 2023, your Company increased its interaction with investors through video and audio conference calls. The top management, including the Managing Director & CEO, Executive Director and CEO (Auto and Farm Sector) and Group CFO, spent significant time to interact with investors to communicate the strategic direction of the business, capital allocation policy and various ESG activities. All the investor connect events including four quarterly earnings calls / analyst meets and product launch events conducted during the year were also well attended by investors and analysts.

During the year, your Company interacted with more than 950 Indian and overseas investors and analysts (excluding quarterly earnings calls and specific event related calls). Your Company ensures that critical information about the Company is available to all the investors by uploading all such information on the Company's website.

Please refer to the section on "Analyst / Institutional Investors Presentation" in the Corporate Governance section for details of number of Investor / Analyst Interactions held during the year.

Dividend

As per the Dividend Distribution Policy, dividend payout would have to be determined based on available financial resources, investment requirements and taking into account optimal shareholder return. Within these parameters, the Company would endeavour to maintain a total dividend pay-out ratio in the range of 20% to 35% of the annual standalone Profits after Tax (PAT) of the Company.

Your Directors, considering the good performance and a strong cash flow, decided to recommend a Dividend of Rs. 16.25 (325%) per Ordinary (Equity) Share of the face value of Rs. 5 each out of the Profits for the financial year ended 31^st March, 2023.

The equity dividend outgo for the Financial Year 2022-23 would absorb a sum of Rs. 2,020.73 crores resulting in a payout of 25.33% of the standalone net profit of the Company for the Financial Year 2022-23 [as against Rs. 1,435.89 crores comprising the dividend of Rs. 11.55 per Ordinary (Equity) Share of the face value of Rs. 5 each for the previous year]. Dividend will be payable subject to approval of members at the ensuing Annual General Meeting and deduction of tax at source to those Shareholders whose names appear in the Register of Members as on the Book Closure Date. The Board of your Company decided not to transfer any amount to the General Reserve for the year under review.

Dividend Distribution Policy

The Dividend Distribution Policy containing the requirements mentioned in Regulation 43A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations") is attached as Annexure I and forms part of this Annual Report.

The Dividend Distribution Policy of the Company is also uploaded on the Company's website at the following Web-link: https://www.mahindra.com/investor-relations/policies-and- documents.

B. CONSOLIDATED FINANCIAL STATEMENTS

The Consolidated Financial Statements of the Company, its subsidiaries, associates and joint ventures prepared in accordance with the Companies Act, 2013 and applicable Indian Accounting Standards along with all relevant documents and the Auditors' Report form part of this Annual Report. The Consolidated Financial Statements presented by the Company include the financial results of its subsidiary companies, associates and joint ventures.

The Consolidated Revenue from operations is Rs. 1,21,269 crores in the current year as compared to Rs. 90,171 crores in the previous year, registering an increase of 34.5%.

The consolidated profit before exceptional items, share of profit of associates and joint ventures and tax for the year is Rs. 11,305 crores as against Rs. 7,092 crores in the previous year, registering an increase of 59.4%. The consolidated profit after tax after non-controlling interest and exceptional items for the year is Rs. 10,282 crores as against Rs. 6,577 crores in the previous year, registering an increase of 56.3%.

The Financial Statements as stated above are also available on the website of the Company and can be accessed at the Web-link: https://www.mahindra.com/resources/FY23/ AnnualReport.zip.

Subsidiary, Joint Venture and Associate Companies

The Mahindra Group Companies continue to contribute to the overall growth in revenues and overall performance of your Company.

Tech Mahindra Limited, Flagship Company in the IT Sector, reported a consolidated operating revenue of Rs. 53,290 crores in the current year as compared to Rs. 44,646 crores in the previous year, registering an increase of 19.4%. Its consolidated profit after tax after non-controlling interests is Rs. 4,831 crores as compared to Rs. 5,566 crores in the previous year, registering a decrease of 13.2%.

The Group's finance company, Mahindra & Mahindra Financial Services Limited, a listed subsidiary of the Company (Mahindra Finance), reported a consolidated operating revenue of Rs. 12,700 crores during the current year as compared to Rs. 11,318 crores in the previous year, registering an increase of 12.2%. The consolidated profit after tax after non-controlling interests for the year is Rs. 2,072 crores as compared to Rs. 1,137 crores in the previous year, registering an increase of 82.2%.

Mahindra Lifespace Developers Limited, the listed subsidiary in the business of real estate and infrastructure, reported a consolidated operating revenue of Rs. 607 crores as compared to Rs. 394 crores in the previous year, registering an increase of 54.1%. The consolidated profit after tax after non-controlling interest for the year is Rs. 101 crores as compared to Rs. 154 crores in the previous year, registering a decrease of 34.4%.

Mahindra Holidays & Resorts India Limited, the listed subsidiary in the business of timeshare, registered a consolidated operating revenue of Rs. 2,517 crores as compared to Rs. 2,013 crores in the previous year, registering an increase of 25%. The consolidated profit after tax after non-controlling interests for the year is Rs. 115 crores as compared to Rs. 68 crores in the previous year, registering an increase of 69.1%.

Mahindra Logistics Limited, a listed subsidiary in the logistics business, reported a consolidated operating revenue of Rs. 5,128 crores as compared to Rs. 4,141 crores in the previous year registering an increase of 23.8%. The consolidated profit after tax after non-controlling interests for the year is Rs. 26 crores as compared to Rs. 18 crores in the previous year, registering an increase of 44.4%.

Swaraj Engines Limited*, a listed subsidiary in the business of manufacture of Diesel Engines and its components, reported operating revenue of Rs. 1,422 crores as compared to Rs. 1,138 crores in the previous year registering an increase of 25%. The profit after tax for the year is Rs. 134 crores as compared to Rs. 109 crores in the previous year, registering an increase of 22.9%.

* During the year ended 31^stMarch, 2023, the Controlling status was changed from associate to subsidiary.

During the year under review, Mahindra Holidays & Resorts Harihareshwar Limited, Resurgence Solarize Urja Private Limited, V-Link Freight Services Private Limited, Swaraj Engines Limited, Mahindra Electric Automobile Limited, Emergent Solren Private Limited, Guestline Hospitality Management and Developement Services Limited, MLL Global Logistics Limited and M.I.T.R.A Agro Equipments Private Limited became subsidiaries of your Company.

Further, MLL Mobility Private Limited (Formerly known as Meru Mobility Tech Private Limited) ("MLL Mobility"), V-Link Fleet Solutions Private Limited ("VFSPL") and V-Link Automotive Services Private Limited ("VASPL") have ceased to be wholly owned subsidiaries of MLL Express Services Private Limited (Formerly known as Meru Travel Solutions Private Limited) ("MLL Express"), a wholly owned subsidiary of your Company

and have become wholly owned subsidiaries of Mahindra Logistics Limited ("MLL"), a listed subsidiary of your Company. Further, MLL Express has also ceased to be a wholly owned subsidiary of your Company and has become a wholly owned subsidiary of MLL. Since, MLL is a listed subsidiary of your Company, MLL Express, MLL Mobility, VFSPL and VASPL continue to remain the subsidiaries of your Company.

During the year under review, Kiinteisto Oy Himos Gardens, Kiinteisto Oy Vanha Ykkostii, Kiinteisto Oy Katinnurkka, Kiinteisto Oy Tenetinlahti, Kiinteisto Oy Mallosniemi, Kiinteisto Oy Rauhan Ranta 1, Kiinteisto Oy Rauhan Ranta 2, Kiinteisto Oy Tiurunniemi, Kiinteisto Oy Kylpylantorni 1, Kiinteisto Oy Spa Lofts 2, Kiinteisto Oy Spa Lofts 3, Kiinteisto Oy Kuusamon Pulkkajarvi 1, Kiinteisto Oy Rauhan Liikekiinteistot 1, OFD Holding BV, Origin Direct Asia Ltd, Origin Fruit Direct B.V., Origin Fruit Services South America SpA, Origin Direct Asia (Shanghai) Trading Co. Ltd., Mahindra Engineering and Chemical Products Limited, Retail Initiative Holdings Limited, Mahindra Retail Limited, Ssangyong Motor Company, SsangYong Australia Pty Limited, Ssangyong European Parts Center B.V, SY Auto Capital Co., LTD, Merakisan Private Limited, Mahindra Tractor Assembly Inc., Mahindra Integrated Township Limited, Mahindra Residential Developers Limited, Mahindra West Africa Ltd, Peugeot Motocycles S.A.S., Peugeot Motocycles Italia S.r.l. (in liquidazione), Peugeot Motocycles Deutschland GmbH, PMTC Engineering S.r.l., Mahindra Electric Mobility Limited, Mahindra Fresh Fruits Distribution Holding Company (Europe) B.V., HCR Management Oy, Mahindra Bangladesh Private Limited, Mahindra Consulting Engineers Limited and Mahindra Namaste Limited ceased to be subsidiaries of your Company.

Ssangyong Motor Company, after ceasing to be a Subsidiary of the Company, became an Associate for a short period of time and ceased thereafter.

During the year under review, Brainbees Solutions Private Limited became an Associate of your Company pursuant to the Scheme of Merger by Absorption of Mahindra Engineering and Chemical Products Limited, Retail Initiative Holdings Limited and Mahindra Retail Limited with the Company becoming effective.

During the year under review, Swaraj Engines Limited and M.I.T.R.A Agro Equipments Private Limited ceased to be Associates of your Company as they became Subsidiaries of your Company.

During the year under review, Supermarket Capri Oy changed its name to Kiinteisto Oy Rauhan Liikekiinteistot 1, Meru Travel Solutions Private Limited changed its name to MLL Express Services Private Limited, Meru Mobility Tech Private Limited changed its name to MLL Mobility Private

Limited and Mahindra Intertrade Limited changed its name to Mahindra Accelo Limited.

Subsequent to the year end, Bristlecone Ltd. changed its name to Bristlecone Worldwide, Inc. pursuant to its registration in Delaware as a US corporation, Mahindra Telecom Energy Management Services Private Limited changed its name to Mahindra Sustainable Energy Private Limited and Mahindra Renewables Private Limited changed its name to Megasolis Renewables Private Limited.

Subsequent to the year end, Sanyo Special Steel Manufacturing India Private Limited (formerly known as Mahindra Sanyo Special Steel Private Limited) ceased to be an Associate of your Company. Mahindra CIE Automotive Limited, an Associate of the Company, has on 16^th May, 2023 informed the Stock Exchanges that its application for change of name from Mahindra CIE Automotive Limited to CIE Automotive India Limited has been approved by the Central Government on 15^th May, 2023. As on the date of this Report, the Master Data on the website of the Ministry of Corporate Affairs www.mca.gov.in carries the new name of the company and that the 'fresh certificate of Incorporation pursuant to change in name' as per Section 13(3) of the Companies Act, 2013 read with Rule 29 of the Companies (Incorporation) Rules, 2014 was awaited.

A Report on the performance and financial position of each of the subsidiaries, associates and joint venture companies included in the Consolidated Financial Statements and their contribution to the overall performance of the Company, is provided in Form AOC-1 and forms part of this Annual Report.

The Policy for determining material subsidiaries as approved by the Board is uploaded on the Company's website and can be accessed in the Governance section at the Web-link: https://www.mahindra.com/investor-relations/policies-and- documents.

Mahindra Electric Automobile Limited

During the year, Mahindra Electric Automobile Limited (MEAL) was incorporated to undertake the 4 (Four) Wheel Passenger Electric Vehicles business, as a wholly owned subsidiary of the Company. Accordingly, the Company transferred certain identified assets (capital work in progress) pertaining to the 4 (Four) Wheel Passenger Electric Vehicles to MEAL. Further, the Company entered into Securities Subscription Agreement and Shareholders' Agreement with British International Investment Plc ("BII") to invest upto Rs. 1,925 crores each in MEAL in two or more tranches. BII would invest in the form of Compulsory Convertible Preference Shares ("CCPS") at a valuation of upto Rs. 70,070 crores, resulting in 2.75% to 4.76% ownership for BII in MEAL. The said investment by BII also envisages BII having a nominal shareholding of 100 Equity Shares in MEAL. Part of the investment by BII in CCPS of MEAL was completed during the financial year.

Acquiring balance stake in Sampo Rosenlew Oy, Finland ("Sampo")

During the year, your Company exercised the Call Option and entered into the Share Purchase Agreement to acquire the balance 1,317 Equity Shares of Sampo at a price of Euro 3,333 per share from other shareholders, increasing the equity stake of the Company in Sampo from 79.13% to 100%. Consequently, Sampo has become a wholly owned subsidiary of the Company.

Induction of OTPP, the financial partner in Renewables Business

During the year, Mahindra Holdings Limited ("MHL"), a wholly owned subsidiary of your Company, and Mahindra Susten Private Limited ("MSPL"), a wholly owned subsidiary of MHL and of your Company entered into a Share Purchase Agreement and Shareholders' Agreement with 2452991 Ontario Limited ("2OL"), a wholly owned subsidiary of Ontario Teachers' Pension Plan Board ("OTPP") for the sale of 30% stake in MSPL by MHL to 2OL, with an option for an additional 9.99% stake sale in MSPL by MHL to 2OL or any other investor. The agreement also envisages the formation of an Infrastructure Investment Trust ("InvIT") through a series of transactions, subject to applicable laws and regulations, having MSPL and 2OL or any of its affiliates (Ontario Teachers') as Sponsors. The InvIT shall own identified operational renewable assets.

The transaction will enable your Company to unlock value in the Renewable Energy Sector and it will continue to invest along with Ontario Teachers' to help realise its twin objectives of accelerated growth and global leadership in ESG. The first stage of the transaction entailing the sale of 30% stake in MSPL was completed during the financial year.

SsangYong Motor Company (SYMC)

As mentioned in the previous Annual Report, post termination of Investment Agreement executed with Edison Motor Consortium pursuant to Court Receivership process as per the provisions of Korean Debtor Rehabilitation and Bankruptcy Act, SYMC initiated a process to invite new investor(s). During the year, Seoul Bankruptcy Court approved a rehabilitation plan reflecting the Investment Agreement between the KG consortium, led by South Korea based conglomerate KG Group and SYMC. KG consortium acquired a stake of 80.50% in debt-ridden SYMC for KRW 930 billion in one or more tranches. The Company's ownership and outstanding dues in SYMC were restructured as part of the rehabilitation plan. The Company received cash payment of approximately KRW 10.2 billion and the shareholding of the Company stands reduced to approximately 5.2% post the completion of all tranches by KG Group.

Divestment of stake in CIE Automotive India Limited ("CIE")

On 27^th September, 2022, your Company sold 82,42,444 equity shares at a gross price of Rs. 285 per share representing 2.173% of the paid-up share capital of CIE, a listed associate of the Company.

Thereafter, on 13^th March, 2023, your Company further sold 2,29,80,000 equity shares at a gross price of Rs. 357.39 per share representing 6.058% of the paid-up share capital of CIE. Following the aforesaid sale of shares, the shareholding of the Company in CIE has come down from 9.253% to 3.195% of its share capital.

Subsequent to the year end, the Company sold the balance 3.195% equity stake in CIE comprising of 1,21,22,068 equity shares at a gross price of Rs. 447.6501 per share and the Company's shareholding in CIE has become Nil.

Divestment of stake in Peugeot Motocycles S A S. ("PMTC")

During the year, Mahindra Two Wheelers Europe Holdings S.a.r.l. ("MTWEH"), a wholly owned subsidiary of the Company, Peugeot Motocycles S.A.S. ("PMTC") and Purple Holding (a wholly owned subsidiary of Mutares Holding-56 GmbH) executed an Irrevocable Offer and as a part of the said Offer, inter alia agreed to:

• Conversion of existing 3,12,085 ordinary shares held by MTWEH in PMTC to 3,12,085 "Preferred Shares A" whereby the existing 100% shareholding and voting rights of MTWEH in PMTC stand reduced to 50% in terms of shareholding and 19.99% in terms of voting rights.

• Investment by MTWEH in PMTC in the form of subscription to Bonds redeemable into "Preferred Shares A" of PMTC i.e. "Obligations Remboursables en Actions de Preference A" known as "ORA".

• Investment of an amount of Euro 7 million by Purple in PMTC in the form of subscription to 3,12,085 "Preferred Shares B" which would entitle Purple to a 50% shareholding and 80.01% voting rights in PMTC.

Pursuant to the transaction closure on 31^st January, 2023, PMTC and its subsidiaries have ceased to be subsidiaries of MTWEH and consequently of the Company.

Merger of Mahindra Electric Mobility Limited with the Company

As mentioned in the previous Annual Report, the Board of Directors of your Company at its Meeting held on 28^th May, 2021, subject to requisite approvals / consents, approved the Scheme of Merger by Absorption of Mahindra Electric Mobility Limited ("MEML") with the Company and their respective shareholders ("Scheme") under the provisions of sections 230 to 232 and other applicable provisions of the Companies Act, 2013.

The Scheme was made effective from 2^nd February, 2023 upon receipt of approval from the National Company Law Tribunal, Mumbai Bench ("NCLT") and such other statutory / Government authorities as directed by the NCLT. The Appointed Date of the Scheme was 1^st April, 2021 and the entire assets and liabilities of MEML have been transferred to and recorded by the Company as per applicable accounting standards.

Upon the Scheme becoming effective, Ordinary (Equity) Shares of the Company have been issued to the shareholders of MEML (other than the Company or subsidiary(ies) of the Company holding shares directly and jointly with its nominee shareholders) in accordance with the share exchange ratio under the Scheme i.e. 480 (Four Hundred and Eighty) Ordinary (Equity) Shares of Rs. 5 each fully paid-up of the Company for every 10,000 (Ten Thousand) Equity Shares of Rs. 10 each fully paid-up held in MEML as on Record Date. The shares held in MEML by the Company or its subsidiary(ies) directly and jointly with its nominee shareholders stand cancelled upon the Scheme becoming effective. Additionally, the stock options held by the eligible ESOP holders of MEML as on the Record Date have been substituted with ESOPs of the Company in accordance with the Scheme. Accordingly, the Merger by Absorption of MEML with the Company stands completed.

Induction of International Finance Corporation, the financial partner, in Last Mile Mobility Business

During the year, the Company approved sale / transfer of assets and / or business pertaining to the Last Mile Mobility Business of the Company to a new company to be incorporated as a wholly owned subsidiary of the Company ("NewCo"). Further, the Company entered into a Subscription Agreement and Shareholders Agreement with International Finance Corporation ("IFC") a member of the World Bank Group, whereby IFC has agreed to invest upto Rs. 600 crores in the NewCo, in one or more tranches.

IFC's investment will be in the form of Compulsorily Convertible Preference Shares ("CCPS") at a valuation of up to Rs. 6,020 crores, resulting in an ownership of between 9.97% to 13.64% for IFC in NewCo. IFC would inter alia have a right to give voting instructions to the Company upto 11.8% of the paid-up capital of NewCo in tranches until conversion of CCPS.

Increase of stake in Mahindra Aerospace Private Limited

The Company acquired 7,67,59,301 Equity Shares of Mahindra Aerospace Private Limited, a subsidiary of the Company ("MAPL") from the other shareholders of MAPL. Upon completion of the said transaction, the shareholding of the Company in MAPL has increased from 91.59% to 100% of the Equity Share Capital of MAPL. Consequently, MAPL has become a wholly owned subsidiary of the Company.

Sale of Stake held by the Company in TVS Automobile Solutions Private Limited

During the year, your Company sold 3,32,195 Equity Shares of Rs. 10 each and 100 Compulsorily Convertible Preference Shares of Rs. 10 each in TVS Automobile Solutions Private Limited ("TASL") constituting 2.76% of the Paid-up Capital of TASL on a fully diluted basis. Post this sale, the Company does not have any equity interest in TASL.

Increase of stake in M.I.T.R.A. Agro Equipments Private Limited

During the year, your Company increased its shareholding in M.I.T.R.A. Agro Equipments Private Limited ("MITRA"), from 47.33% to 100% on a fully diluted basis, for an aggregate consideration of around Rs. 61.71 crores. MITRA is an Indian company engaged in the business of designing, developing, manufacturing, assembling and selling high precision orchard sprayers and is a trusted brand for farmers growing fruits such as grapes, pomegranates and oranges. The purchase of additional equity shares in MITRA would aid the Company's Farm Equipment Sector's growth and expansion in the growing horticulture sector.

Divestment of stake in Mahindra Waste to Energy Solutions Limited by the Company to Blue Planet Environmental Solutions Pte. Ltd.

During the year, your Company increased its shareholding in Mahindra Waste to Energy Solutions Limited ("MWTESL") from 87.39% to 100% by acquiring the balance 12.61% of the Paid-Up Equity Share Capital of MWTESL making it a wholly owned subsidiary of the Company. Further, the Company entered into a Share Purchase Agreement and a Shareholders Agreement with Blue Planet Environmental Solutions Pte Ltd. ("BPES") for the sale of 80% of the Paid-Up Equity Share Capital of MWTESL to BPES or any of its affiliates, in one or more tranches at a price of Rs. 8.44 per share for an aggregate consideration of Rs. 20.25 crores ("First Closing"). Following the sale, the Company's holding in MWTESL would reduce to 20% and MWTESL would cease to be a Subsidiary of the Company.

Further, the Company will have a right of "put option" to sell the balance 20% of the Paid-Up Equity Share Capital of MWTESL and BPES will have the right of "call option", after 24 months from First Closing, at a price not less than Rs. 8.44 per share, subject to certain closing conditions ("Second Closing"). The Sale price agreed for this tranche shall be higher of Rs. 8.44 (rounded off) or the fair value per share of MWTESL multiplied by the number of shares being sold, as adjusted upwards in the event of occurrence of certain specified events.

Sale of stake in Mahindra Consulting Engineers Limited by the Company to Artelia Holding SAS ("Artelia")

During the year, your Company has sold its entire stake in Mahindra Consulting Engineers Limited ("MCEL"), a subsidiary of the Company i.e. 60.88% of the Paid-Up Equity Share Capital of MCEL to Artelia, in one or more tranches at a price of Rs. 89.66 per share for an aggregate consideration of Rs. 10,31,98,660. Following the sale, MCEL has ceased to be the subsidiary of the Company. Consequent to the above, Mahindra Namaste Limited ("MNL"), a wholly owned subsidiary of MCEL has also ceased to be a subsidiary of the Company.

Increase of stake in Swaraj Engines Limited

During the year, your Company increased its shareholding in Swaraj Engines Limited ("SEL") by acquiring 21,14,349 Equity shares constituting 17.41% of the Paid-up Equity Share Capital of SEL from Kirloskar Industries Limited ("KIL"). Consequently, the shareholding and voting rights of the Company in SEL have increased from 34.72% to 52.13% of the Equity Share Capital of SEL and SEL has become a listed subsidiary of the Company. SEL is into manufacturing and supplying of diesel Engines in the range of 22 HP to above 65 HP for fitment in tractors to Farm Equipment Sector of the Company.

Sale of Stake by Mahindra Agri Solutions Limited ("MASL") in Merakisan Private Limited, a subsidiary of MASL

During the year, Mahindra Agri Solutions Limited ("MASL"), a subsidiary of the Company, has sold its entire stake aggregating 91.59% of the Paid-up Equity Share Capital in Merakisan Private Limited ("MKPL"), a subsidiary of MASL, to Mr. Prashant Patil, founder and Whole time Director & CEO of MKPL. Following the completion of aforesaid sale, MKPL ceased to be a subsidiary of MASL and consequently that of the Company.

Sale of Stake held by the Company in Sanyo Special Steel Manufacturing India Private Limited (Formerly known as Mahindra Sanyo Special Steel Private Limited) pursuant to exercise of a Put Option

As mentioned in the previous Annual Report, the Company had agreed to sell 34,75,264 Equity Shares of Rs. 10 each held by the Company in Sanyo Special Steel Manufacturing India Private Limited (Formerly known as Mahindra Sanyo Special Steel Private Limited) ("SSSMIPL") constituting 22.81% of the Paid-up Capital of SSSMIPL to Sanyo Special Steel Co., Ltd ("Sanyo") pursuant to exercise of a Put Option available to the Company on Sanyo under the Shareholders' Agreement. Following the completion of aforesaid sale, SSSMIPL has ceased to be an Associate of the Company.

D. INTERNAL FINANCIAL CONTROLS

The Corporate Governance Policies guide the conduct of affairs of your Company and clearly delineate the roles, responsibilities and authorities at each level of its governance structure and key functionaries involved in governance. The Code of Conduct for Senior Management and Employees of your Company (the Code of Conduct) commits Management to financial and accounting policies, systems and processes. The Corporate Governance Policies and the Code of Conduct stand widely communicated across your Company at all times.

Your Company's Financial Statements are prepared on the basis of the Significant Accounting Policies that are carefully selected by Management and approved by the Audit Committee and the Board. These Accounting policies are reviewed and updated from time to time.

Your Company uses SAP ERP Systems as a business enabler and to maintain its Books of Account. The transactional controls built into the SAP ERP Systems ensure appropriate segregation of duties, appropriate level of approval mechanisms and maintenance of supporting records. The Policies related to the Information Management reinforce the control environment. The systems, Standard Operating Procedures and controls are reviewed by Management. These systems and controls are subjected to Internal Audit and their findings and recommendations are reviewed by the Audit Committee which ensures the implementation.

The SAP ERP System has feature of recording an Audit Trail of each and every transaction, creating an edit log of each change made in books of account along with the date when such changes were made and ensuring that the audit trail cannot be disabled, as mandated under the recent amendment under Companies (Accounts) Rules, 2014, effective 1^st April, 2023.

Your Company has in place adequate internal financial controls with reference to the Financial Statements commensurate with the size, scale and complexity of its operations. Your Company's Internal Financial Controls were deployed through Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO), that addresses material risks in your Company's operations and financial reporting objectives.

Such controls have been assessed during the year under review taking into consideration the essential components of internal controls stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by The Institute of Chartered Accountants of India. Based on the results of such assessments carried out by the Management, no reportable material weakness or significant deficiencies in the design or operation of internal financial controls was observed.

Your Company recognizes that the Internal Financial Controls cannot provide absolute assurance of achieving financial, operational and compliance reporting objectives because of its inherent limitations. Also, projections of any evaluation of the Internal Financial Controls to future periods are subject to the risk that the Internal Financial Controls may become inadequate because of changes in conditions or that the degree of compliance with the policies or procedures may deteriorate. Accordingly, regular audits and review processes ensure that such systems are reinforced on an ongoing basis.

E. MANAGEMENT DISCUSSION AND ANALYSIS REPORT

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

F. RELATED PARTY TRANSACTIONS

The Company has in place a robust process for approval of Related Party Transactions and on Dealing with Related Parties.

As per the process, necessary details for each of the Related Party Transactions as applicable along with the justification are provided to the Audit Committee in terms of the Company's Policy on Materiality and Dealing with Related Party Transactions and as required under SEBI Circular dated 22^nd November, 2021. The Material Related Party Transactions approved by the Members of the Company are also reviewed / monitored on quarterly basis by the Audit Committee of the Company as per Regulation 23 of the Listing Regulations and Section 177 of the Companies Act, 2013.

All Related Party Transactions entered during the year were in the ordinary course of business and on arm's length basis.

During the year under review, your Company has entered into Material Related Party Transactions as approved by the Members under Regulation 23 of the Listing Regulations.

The Company has not entered into Material Related Party Transactions as per the provisions of the Companies Act, 2013 and a confirmation to this effect as required under section 134(3)(h) of the Companies Act, 2013 is given in Form AOC-2 as Annexure II, which forms part of this Annual Report.

The Policy on Materiality of and Dealing with Related Party Transactions as approved by the Board is uploaded on the Company's website and can be accessed in the Governance section at the Web-link: https://www.mahindra.com/investor- relations/policies-and-documents.

Statutory Auditors and Auditors' Report

Messrs B S R & Co. LLP, Chartered Accountants (ICAI Firm Registration Number 101248W/W-100022) were re-appointed as the Statutory Auditors of the Company to hold office for a second term of 5 years from the conclusion of the 76^th Annual General Meeting (AGM) held on 5^th August, 2022 until the conclusion of the 81^st AGM of the Company to be held in the year 2027.

The Auditors' Report for FY 2022-23 is unmodified i.e. it does not contain any qualification, reservation or adverse remark or disclaimer.

Secretarial Auditor

Pursuant to the provisions of section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Mr. Sachin Bhagwat, Practicing Company Secretary (Certificate of Practice Number: 6029) to undertake the Secretarial Audit of the Company.

The Company has annexed to this Board's Report as Annexure III, a Secretarial Audit Report for the Financial Year 2022-23 given by the Secretarial Auditor.

The Secretarial Audit Report does not contain any qualification, reservation or adverse remark or disclaimer.

Annual Secretarial Compliance Report

The Company has undertaken an audit for the Financial Year 2022-23 for all applicable compliances as per SEBI Regulations and Circulars / Guidelines issued thereunder. The Annual Secretarial Compliance Report duly signed by Mr. Sachin Bhagwat has been submitted to the Stock Exchanges and is annexed at Annexure IV to this Board's Report.

Secretarial Audit of Material Unlisted Indian Subsidiary

There is no Material Unlisted Indian Subsidiary of the Company as on 31^st March, 2023 and as such the requirement under Regulation 24A of the Listing Regulations regarding the Secretarial Audit of Material Unlisted Indian Subsidiary is not applicable to the Company for the Financial Year 2022-23.

Cost Auditors

The Board had appointed Messrs D. C. Dave & Co., Cost Accountants (Firm Registration Number 000611), as Cost Auditor for conducting the audit of cost records of the Company for the Financial Year 2022-23.

The Board of Directors on the recommendation of the Audit Committee, appointed Messrs D. C. Dave & Co., Cost Accountants (Firm Registration Number 000611), as the Cost Auditors of the Company for the Financial Year 2023-24 under section 148 of the Companies Act, 2013. Messrs D. C. Dave & Co. have confirmed that their appointment is within the limits of section 141(3)(g) of the Companies Act, 2013 and have also certified that they are free from any disqualifications specified under section 141(3) and proviso to section 148(3) read with section 141(4) of the Companies Act, 2013.

The Audit Committee has also received a Certificate from the Cost Auditors certifying their independence and arm's length relationship with the Company.

As per the provisions of the Companies Act, 2013, the remuneration payable to the Cost Auditor is required to be placed before the Members in a General Meeting for their ratification. Accordingly, a Resolution seeking Members' ratification for the remuneration payable to Messrs D. C. Dave & Co., Cost Auditors is included in the Notice convening the Annual General Meeting.

Cost Records

As per Section 148 of the Companies Act, 2013, read with the Companies (Cost Records and Audit) Rules, 2014, your Company is required to maintain cost records and accordingly, such accounts and records are maintained.

Reporting of Frauds by Auditors

During the year under review, the Statutory Auditors, Cost Auditors and Secretarial Auditor have not reported any instances of frauds committed in the Company by its Officers or Employees to the Audit Committee under section 143(12) of the Companies Act, 2013.

H. PARTICULARS OF LOANS, GUARANTEES, INVESTMENTS AND SECURITIES

Particulars of the loans given, investment made or guarantee given or security provided and the purpose for which the loan or guarantee or security is proposed to be utilised by the recipient of the loan or guarantee or security are provided in Note Nos. 8 and 40 to the Financial Statements.

I. PUBLIC DEPOSITS AND LOANS/ADVANCES

Your Company had discontinued acceptance of Fixed Deposits with effect from 1^st April, 2014.

All the deposits from public and shareholders had already matured as on 31^st March, 2017. Out of these, 5 deposits aggregating Rs. 0.84 lakhs from the public and shareholders as on 31^st March, 2023 had matured and had not been paid at the end of the Financial Year as there is a restraining

order from the Court / Tribunal / Statutory Authority. Since then, no deposits have been claimed.

There was no default in repayment of deposits or payment of interest thereon during the year under review. There are no deposits which are not in compliance with the requirements of Chapter V of the Companies Act, 2013.

The particulars of loans / advances / investments, etc., required to be disclosed pursuant to Para A of Schedule V of the Listing Regulations are furnished separately in this Annual Report.

The transaction(s) of the Company with a company belonging to the promoter / promoter group which hold(s) more than 10% shareholding in the Company as required pursuant to Para A of Schedule V of the Listing Regulations are disclosed separately in the Financial Statements of the Company.

Key Managerial Personnel (KMP)

The following have been designated as the Key Managerial Personnel of the Company pursuant to Sections 2(51) and 203 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014:

(a) Dr. Anish Shah - Managing Director and CEO

(b) Mr. Rajesh Jejurikar - Executive Director and CEO (Auto and Farm Sector) (re-designated with effect from 15^th March, 2023)

(c) Mr. Manoj Bhat - Group Chief Financial Officer

(d) Mr. Narayan Shankar - Company Secretary

Employees' Stock Option and Employees' Welfare Schemes

During the year under review, based on the recommendation of the Governance, Nomination and Remuneration Committee (GNRC) of your Company, the Trustees of Mahindra & Mahindra Employees' Stock Option Trust have granted Stock Options to employees under the Mahindra & Mahindra Limited Employees Stock Option Scheme 2010. No Stock Options have been granted to employees under the Mahindra & Mahindra Limited Employees Stock Option Scheme 2000 (2000 Scheme).

The Company has in force the following Schemes which get covered under the provisions of SEBI (Share Based

Employee Benefits and Sweat Equity) Regulations, 2021 (SBEB Regulations 2021):

1. Mahindra & Mahindra Limited Employees Stock Option Scheme - 2000 (2000 Scheme)*

2. Mahindra & Mahindra Limited Employees Stock Option Scheme - 2010 (2010 Scheme)

3. M&M Employees Welfare Fund No. 1

4. M&M Employees Welfare Fund No. 2

5. M&M Employees Welfare Fund No. 3

* No outstanding options as on 31^st March, 2023

There are no changes made to the above Schemes during the year under review and these Schemes are in compliance with the SBEB Regulations 2021. Your Company's Secretarial Auditor, Mr. Sachin Bhagwat, has certified that the Company's above-mentioned Schemes have been implemented in accordance with the SBEB Regulations 2021, and the Resolutions passed by the Members for the 2000 Scheme and the 2010 Scheme.

Information as required under Regulation 14 read with Part F of Schedule I of the SBEB Regulations 2021 has been uploaded on the Company's website and can be accessed at the Web-link: https://www.mahindra.com/resources/FY23/ AnnualReport.zip.

Particulars of Employees and related disclosures

The Company had 500 employees who were in receipt of remuneration of not less than Rs. 1,02,00,000 during the year ended 31^st March, 2023 or not less than Rs. 8,50,000 per month during any part of the year.

Details of employee remuneration as required under provisions of Section 197(12) of the Companies Act, 2013 read with Rule 5(2) & 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 will be made available during 21 days before the Annual General Meeting in electronic mode to any Shareholder upon request sent at agm.inspection@mahindra.com. Such details are also available on your Company's website and can be accessed at the Web-link: https://www.mahindra.com/resources/FY23/ AnnualReport.zip.

Disclosures with respect to the remuneration of Directors, Key Managerial Personnel (KMPs) and employees as required under Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are given in Annexure V to this Report.

Industrial Relations

The year under review witnessed a very positive Industrial Relations Scenario across all manufacturing locations for the Automotive and Farm Equipment Sectors.

Your Company's focus continues towards propagating proactive and employee centric practices. The transformational work culture initiative that aims to create an engaged workforce with an innovative, productive and a competitive shop-floor ecosystem continues to grow in strength.

Some examples of the programs put in place includes 'Rise2.0 for Associates', Associate Leadership Development Program, Development of Self-Managed Team, Employee of the year, e-compliance, reward and recognition for associates and programs on Code of Conduct, POSH, ABAC and Human Rights. The Employee Relations Council is dedicated towards building a positive Work Culture and leads the design and implementation of these programs and reviews its progress.

With the objective of capability building, developing future ready workforce and fostering togetherness at the workplace, your Company implements multiple training and engagement programs on an ongoing basis. These include various behavioural and functional programs such as Behavioural based safety, quality tools, TPM, continuous improvement, decision making, learning agility and programs on skill building such as Robotics, PLC Programming, Networking, etc. ASDC certification program for selected Trainees were also on offer. In its continuous endeavour to improve the employee lifecycle processes, your Company has been ensuring that Employee Connect Centre (ECC), the digital form of traditional time office offers better experience in time and payroll management of the associates. To enable self-paced learning, Learning Management System (LMS) on digital platform for associates has been helping immensely during this fast paced work environment.

The Mahindra Skill Excellence initiative, a holistic approach to enhance the skill and capabilities of shop floor associates, is receiving good participation across manufacturing facilities.

In an endeavour to improve quality, reduce cost, ensure safety, and improve productivity, your Company's shop floor associates managed to generate on an average 12 ideas per person in the Financial Year 2023.

This year significant emphasis was also laid towards raising awareness on health and wellness of employees in addition to regular annual medical check-ups and health awareness activities. Diet food has become a way of life. The Company maintains an 'Employee Health Index' at an individual level, and this has been a useful tool in identifying employees who require focussed counselling and monitoring.

Proactive and employee-centric shop floor practices, a focus on transparent communication of business goals, an effective concern resolution mechanism, and a firm belief that employees are the most valuable assets of the Company, are the cornerstone of your Company's employee relations approach. An 'open door policy' with constant dialogue to create win-win situations have helped your Company build trust and harmony.

The industrial relations scenario continued to be largely positive across all the manufacturing locations. Long Term Wage and Bonus settlements were closed amicably for all the plants. The sustained efforts towards building a transformational work culture resulted in zero production loss in the Financial Year 2022-23 and helped create a collaborative, healthy and productive work environment.

Safety, Occupational Health and Environment

Your Company has in place the Safety, Occupational Health & Environment (SOH&E) Policy. During the year under review, the Company started all external physical assessments along with Integrated Management System (IMS) certifications as per the following standards, ISO: 9001: 2015, ISO: 14001: 2015 & ISO: 45001: 2018. The management commitment towards SOH&E is demonstrated by adopting amendment updates (including all notifications published) and incorporating the same in mCompliance portal. The Company implemented various initiatives by incorporating all new emission Government specifications by following respective notifications and guidelines complying to overall health and hygiene parameters. The achievements were assessed through periodic reviews by conducting monitoring and measurement exercised by external authorized agencies.

At manufacturing locations, various annual events like Road Safety Week, National Safety Day / Month and Fire Service Week were celebrated. The training programs were leveraged with new topics followed by on-the-job training (OJT) and virtual reality (V.R.) programs for competency building were deployed to train employees. In Safety, Health and Environment competency building at Abhiyantriki, dexterity training programs were arranged for associates. Special focus is given on safety and fire safety by introducing Self-Managed Teams (SMT's) supporting sustainability roadmap to fulfill the requirements.

The Company continues to focus on safety best practices, by conducting Safety observation tours (SoT), monthly themes on safety topics arising out of OHS risks. Horizontal deployment followed by immediate corrective actions (ICA) as well as permanent corrective actions (PCA) are implemented and reviewed by top management. All monthly themes were well participated and appreciated by all associates and officers.

Vigorous drive to eliminate overall at-risk behaviors is conducted by exercising Behavior Based Safety (BBS) Level 2. In order to reduce fire risk, your Company introduced new Dry Sprinkler Powder Aerosol (DSPA) fire protection system by upgrading and introducing modern technology to eliminate property losses. Monthly results were monitored by reviewing office fire (prevention and protection) systems. Fire load reduction is monitored by setting up targets and working towards sustenance of zero fire incidence across each manufacturing location in each Sector. Additionally, all locations are supported and protected by diesel engine powered hydrant system.

Your Company has followed pattern defined by Central Safety Council (CSC) of Mahindra and Mahindra Group Companies by establishing a cross functional team (CFT) after assessment through The Mahindra Safety Way (TMSW). Total 25 parameters are assessed and evaluated stage wise covering all sectors for the Mahindra Group companies across all the plants. Upgradation of results declaration of reward and recognition is given in Mahindra Rise Awards function. A virtual training program was arranged on the topic - "Fire Safety @ Home" on the occasion of Diwali festival for the employees of Mahindra Group Companies and their families with an objective to create awareness among employees and their family regarding Fire, Fire hazards, Risk and Mitigation of the same.

Your Company carried out Risk to business analysis and its mitigation plan, Management of change process, Gap audits for designated license storage areas which were audited by competent persons authorized by respective authority governing the respective compliance. The Company has exercised Statutory Safety, Occupational Health and Environmental, Fire Safety, Electrical Safety Audits. For the year under review, your Company achieved substantial improvements in the results of Safety index and Fire Safety index by adopting new initiatives. Focused drive was taken on critical processes and operations.

To eliminate and minimize the overall environmental impact in line with the "Environmental, Social and Governance" (ESG) practices, your Company has continuously implemented new projects. By revising the objectives, newer targets were taken. New techniques used in various projects have been implemented by your Company in zero carbon emission, waste avoidance /minimization. Carbon footprint reduction is achieved by new kaizens in new energy conservation and improving share of renewable energy. Many of the Company's new initiatives have been shared by your Company by demonstrating Health & Wellness Stall to enhance sustainability performance for children by celebrating them on the occasion of Founders Day. Rising awareness in the supplier community was initiated to encourage their consultation and participation in order to enable them to overcome current and future business risks.

During the year under review, your Company started reporting by reviewing the implementation status under Extended Producer Responsibility Organizations (EPRO) with existing set targets established by Central Government i.e., Central Pollution Control Board by way of released new notifications on Plastic, Tyers and batteries. Plastic elimination and recyclable packaging material in maximum number of spares is initiated by substituting the material as appropriate. Plastic waste management activities cover pan India network developed for plastic waste recycling management for all the Company's manufacturing plants and spares business units are also involved with state wise network for its Suppliers and Dealers.

Your Company implemented various measures towards water neutrality and achieved recycling by processing STP water through RO and achieving less consumption of freshwater requirement. By demonstrating implementation measures, a marked improvement has been observed in ground water recharging.

Your Company continued its commitment to improve the well-being of employees and contract associates through various activities. Education and awareness sessions were conducted on enhancement by arranging Panel Discussion - Listen to Your Heart and webinars on various topics were held i.e., General health, Awareness & COVID 19 Updates, Work Stress Management, Revive your Passion for work and Session on Absenteeism.

Programs are being conducted by renowned faculties for Mahindra family members such as Mass Blood PressureScreening Camp, Eye Check-up camp, Individual Physiotherapist Consultation, Awareness session on Spine and Joint Care, International Yoga Day Celebration followed by competitions i.e., Best Yoga pose etc.

Additionally, the Company has initiated Nutrition Month to improve health at the operational stages working towards fat elimination at workplace. Mahindra Master Chef, on the spot salad making competition were organized for officers and associates. The objective behind the competition was to inculcate healthy food habits and awareness regarding the choice of food. The participant's creativity was revealed through the beautiful designs and patterns formed with different mouth-watering recipes.

The Company has also initiated a project for Emotional Health with an objective of improvement in sleep quality required to maintain the health at workplace.

Videos were created to improve the dexterity and posture observed by employees at shop floor. First aid refresher training programs were organized for employees and associates.

During the year, programs such as Cancer Awareness on Breast and Cervical Cancer screening camp for Women and Health Talk - "Turn the Clock" for all employees and their family members, were arranged. Robust implementation of compliance for Bio-medical Waste Disposal Management is also monitored.

The Company aims at increasing awareness for environment protection amongst all stakeholders by celebrating World Ozone Day, World Environment Day, World Earth Day, World Water Day and Energy Conservation Week and Water Conservation Week, etc. on an annual basis.

The Total Recordable Frequency Rate (TRFR) was 0.10 accidents per million hours worked in Financial Year 2022-23 as compared to 0.08 in the last fiscal year.

Certifications/Recertifications

All Plants of your Company have undergone Surveillance Audits and were certified for Standard ISO 45001: 2018 and ISO 14001: 2015. Further, all plants have implemented Integrated Management System (IMS). Your Company is re-certified for Zero Waste to Landfill with 99% and above conversion rate which ensures the commitment of recycling of waste at maximum extent to protect the environment.

The Senior Management revises and reviews the performances periodically. Focus on new initiatives involving all stakeholders coupled with management reviews have helped your Company to demonstrate further step towards excellence in SOH&E performance.

Sad Demise of Mr. Keshub Mahindra, Chairman Emeritus of the Company

Mr. Keshub Mahindra, Chairman Emeritus, Mahindra Group passed away on 12^th April, 2023. He was a well-known philanthropist who redefined good corporate governance in India. He was an exemplary statesman and an irreplaceable figure in the Indian industry, revered for his vision, his business acumen, his leadership by example, and above all, for his uncompromising professional integrity.

Quote from Mr. Anand Mahindra, Chairman, Mahindra Group

"Mr. Keshub Mahindra was and will always remain a source of inspiration for me and the entire Mahindra Group. He was a man of principles and led from the front to preserve the legacy of our founders which has ensured that the organisation has remained rooted in ethics, values and good corporate governance. Mr. Keshub Mahindra was known for his astute business acumen that helped in transforming Mahindra Group into a diversified federation of companies. His compassion, and people-centric approach made him a global business icon, who was much loved and respected".

Mr. Keshub Mahindra will continue to be an inspiration to everyone in the Mahindra Group.

Directors

During the Financial Year 2022-23, there was no change in the Directors of the Company.

Independent Directors

The Company has received declarations from all the Independent Directors of the Company confirming that they meet the criteria of independence as prescribed both under the Companies Act, 2013 and Listing Regulations.

The Board is of the opinion that the Independent Directors of the Company hold highest standards of integrity and possess requisite expertise and experience required to fulfil their duties as Independent Directors.

In terms of Section 150 of the Companies Act, 2013 read with Rule 6 of the Companies (Appointment and Qualification of Directors) Rules, 2014, Independent Directors of the Company have confirmed that they have registered themselves with the databank maintained by The Indian Institute of Corporate Affairs, Manesar ("IICA").

The Independent Directors are also required to undertake online proficiency self-assessment test conducted by IICA within a period of 2 (two) years from the date of inclusion of their names in the data bank, unless they meet the criteria specified for exemption.

The Independent Directors of the Company are exempt from the requirement to undertake online proficiency self-assessment test except Mr. Muthiah Murugappan who has successfully completed the online proficiency selfassessment test.

Lead Independent Director

Mr. Vikram Singh Mehta, Independent Director and Chairman of Governance, Nomination and Remuneration Committee is the Lead Independent Director. The role and responsibilities of the Lead Independent Director are provided in the Corporate Governance Report forming part of this Annual Report.

Retirement by rotation

Mr. Anand G. Mahindra and Mr. Vijay Kumar Sharma retire by rotation and being eligible, offer themselves for re-appointment at the 77^th Annual General Meeting of the Company scheduled to be held on 4^th August, 2023.

Board Evaluation

Pursuant to the provisions of the Companies Act, 2013 and the Listing Regulations, the Board has carried out an annual evaluation of its own performance and that of its Committees as well as performance of all the Directors individually including Independent Directors, Chairman of the Board, Managing Director & Chief Executive Officer and Executive Director and CEO (Auto and Farm Sector).

I Feedback Mechanism

Feedback was sought by way of a structured questionnaire covering various aspects of the Board's functioning such as adequacy of the composition of the Board and its Committees, Board Culture, Execution and Performance of Specific Duties, Obligations and Governance and the evaluation was carried out based on responses received from the Directors.

I Evaluation of Committees

The performance evaluation of Committees was based on criteria such as structure and composition of Committees, attendance and participation of member of the Committees, fulfilment of the functions assigned to Committees by the Board and applicable regulatory framework, frequency and adequacy of time allocated at the Committee Meetings to fulfil duties assigned to it, adequacy and timeliness of the Agenda and Minutes circulated, comprehensiveness of the discussions and constructive functioning of the Committees, effectiveness of the Committee's recommendation for the decisions of the Board, etc.

I Evaluation of Directors and Board

A separate exercise was carried out by the Governance, Nomination and Remuneration Committee ("GNRC") of the Board to evaluate the performance of Individual Directors. The performance evaluation of the Non-Independent Directors and the Board as a whole was carried out by the Independent Directors. The performance evaluation of the Chairman of the Board was also carried out by the Independent Directors, taking into account the views of the Executive Directors and Non-Executive Directors. The performance evaluation of the Managing Director and the Executive Director of the Company was carried out by the Chairman of the Board and other Directors.

I Criteria for Independent Directors

The performance evaluation of Independent Directors was based on various criteria, inter alia, including attendance at Board and Committee Meetings, skill, experience, ability to challenge views of others in a constructive manner, knowledge acquired with regard to the Company's business, understanding of industry and global trends, etc.

I Criteria for Chairman

The performance evaluation of Chairman of the Board was based on various criteria, inter alia, including style of Chairman's leadership, effective engagement with other Board members during and outside the meetings, allocation of time provided to other Board members at the meetings, effective engagement with shareholders during general meetings, etc.

I Criteria for Managing Director and Executive Director

The performance evaluation of Managing Director and Executive Director was based on various criteria, inter alia, including leadership style, standards of integrity, fairness and transparency demonstrated, identification of strategic targets, anticipation of future demands and opportunities, resource staffing to meet short term and long term goals, engagement with Board and Committee members, updating Board on significant issues, commitment to organisational values, vision and mission, adaptation to meet changing circumstances, knowledge and sensitivity of stakeholders' needs within and outside the Company, demonstrated and effective communication skills.

I Results of Evaluation

The results of the Evaluation for the year under review were shared with the Board, Chairman of respective Committees and individual Directors. The results of Evaluation showed high level of commitment and Engagement of Board, its various Committees and Senior leadership.

As part of the outcome of the Performance Evaluation exercise it was noted that the Board is Independent, operates at a high level of Governance Standards and is committed to creating value for all stakeholders.

It was also noted that the Meetings of the Board are well planned and run effectively by the Chair, its Committees are managed well and continue to perform on their respective focus areas of Governance and Internal Controls.

It was also noted that the Company during the year under review conducted a session on EV familiarisation with the Board highlighting the Company's Strategy and Approach and an Exclusive Strategy and Technology Meeting with the Board Members to apprise and seek feedback from the Board on future initiatives in these areas.

Based on the outcome of the Evaluation of the year under review, the Board has agreed to maintain the High Standards of Governance, Visibility and Interaction in the coming years.

The Directors expressed their satisfaction with the Evaluation process. During the year under review, GNRC ascertained and reconfirmed that the deployment of "questionnaire" as a methodology, is effective for evaluation of performance of Board and Committees and Individual Directors.

Policies

Your Company has adopted the following Policies which, inter alia, include criteria for determining qualifications, positive attributes and independence of a Director:

(a) Policy on Appointment of Directors and Senior Management and succession planning for orderly succession to the Board and the Senior Management;

(b) Policy for remuneration of the Directors, Key Managerial Personnel and other employees.

Policy (a) mentioned above includes the criteria for determining qualifications, positive attributes and independence of a Director, identification of persons who are qualified to become Directors and who may be appointed in the Senior Management Team in accordance with the criteria laid down in the said Policy, succession planning for Directors and Senior Management, and Policy statement for Talent Management framework of the Company.

Policy (b) mentioned above sets out the approach to Compensation of Directors, Key Managerial Personnel and other employees in the Company.

Policies mentioned at (a) and (b) above are available on the website and can be accessed in the Governance section at the Web-link: https://www.mahindra.com/investor-relations/policies-and- documents.

Familiarisation Programme for Independent Directors / Non-Executive Directors

The Members of the Board of the Company are afforded many opportunities to familiarise themselves with the Company, its Management and its operations. The Directors are provided with all the documents to enable them to have a better understanding of the Company, its various operations and the industry in which it operates.

All the Independent Directors of the Company are made aware of their roles and responsibilities at the time of their appointment through a formal letter of appointment, which also stipulates various terms and conditions of their engagement.

Executive Directors and Senior Management provide an overview of the operations and familiarize the new Non-Executive Directors on matters related to the Company's values and commitments. They are also introduced to the organization structure, constitution of various committees, board procedures, risk management strategies, etc.

Strategic Presentations are made to the Board where Directors get an opportunity to interact with Senior Management. Directors are also informed of the various developments in the Company through Press Releases, emails, etc.

The Company has a web based portal i.e. Board portal, accessible to all the Directors which, inter alia, contains the following information:

• Roles, responsibilities and liabilities of Independent Directors under the Companies Act, 2013 and the Listing Regulations

• Board Minutes, Agenda and Presentations

• Annual Reports

• Code of Conduct for Directors

• Terms and conditions of appointment of Independent Directors.

Pursuant to Regulation 25(7) of the Listing Regulations, the Company imparted various familiarisation programmes for its Directors including periodic review of Investments of the Company at Strategic Investment Committee Meetings, Regulatory updates, Industry Outlook, Business Strategy at the Board Meetings and changes with respect to the Companies Act, Taxation and other matters, Listing Regulations, Framework for Related Party Transactions, etc. at the Audit Committee Meetings, Economic Environment & Global Scenario, Frontier Risks, Business Entity Risks, etc. at the Risk Management Committee Meetings, Products Launch and Showcase of New Vehicles, etc. The details as required under Regulations 46 and 62(1A) of the Listing Regulations are available on the website of your Company at the web link: https://www.mahindra.com/resources/FY23/AnnualReport.zip.

Directors' Responsibility Statement

Pursuant to section 134(5) of the Companies Act, 2013, your Directors, based on the representations received from the Operating Management and after due enquiry, confirm that:

(a) in the preparation of the annual accounts for the Financial Year ended 31^st March, 2023, the applicable accounting standards have been followed;

(b) they had in consultation with Statutory Auditors, selected accounting policies and applied them consistently, and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31^st March, 2023 and of the profit of the Company for the year ended on that date;

(c) they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and irregularities;

(d) they have prepared the annual accounts on a going concern basis;

(e) they have laid down adequate Internal Financial Controls to be followed by the Company and such Internal Financial Controls were operating effectively during the Financial Year ended 31^st March, 2023;

(f) they had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively throughout the Financial Year ended 31^st March, 2023.

Board Meetings, Annual General Meeting and NCLT Convened Meeting

A calendar of Meetings is prepared and circulated in advance to the Directors.

During the year 1^st April, 2022 to 31^st March, 2023, nine Board Meetings were held on: 28^th May, 2022, 7^th July, 2022, 5^th August, 2022, 19^th August, 2022, 9^th September, 2022, 10^th and 11^th November, 2022, 21^st November, 2022, 10^th February, 2023 and 15^th March, 2023. The 76^th Annual General Meeting (AGM) of the Company was held on 5^th August, 2022 through Video Conferencing / Other Audio Visual Means.

Further, a Meeting of the Equity Shareholders of your Company was convened on 19^th August, 2022 through VC / OVAM facility as per the directions of the Hon'ble National Company Law Tribunal ("NCLT"), Mumbai Bench vide its Order dated 10^th June, 2022.

Meetings of Independent Directors

The Independent Directors of your Company often meet before the Board Meetings without the presence of the Chairman of the Board or the Managing Director or the Executive Director or other Non-Independent Directors or Chief Financial Officer or any other Management Personnel.

These Meetings are conducted in an informal and flexible manner to enable the Independent Directors to discuss matters pertaining to, inter alia, review of performance of Non-Independent Directors and the Board as a whole, review the performance of the Chairman of the Company (taking into account the views of the Executive and Non-Executive Directors), assess the quality, quantity and timeliness of flow of information between the Company Management and the Board that is necessary for the Board to effectively and reasonably perform their duties.

Five Meetings of Independent Directors were held during the year and these meetings were well attended.

Audit Committee

The Committee comprises of four Directors viz. Mr. T. N. Manoharan (Chairman of the Committee), Ms. Shikha Sharma, Mr. Vikram Singh Mehta and Mr. Haigreve Khaitan. All the Members of the Committee are Independent Directors and possess strong accounting and financial management knowledge. The Company Secretary of the Company is the Secretary of the Committee.

During the year, the scope of Audit Committee was amended to, inter alia, align with the provisions of SEBI (Listing Obligations and Disclosure Requirements) (Sixth Amendment) Regulations, 2022, the details of which are furnished in the Report on Corporate Governance that forms part of this Annual Report.

All the recommendations of the Audit Committee were accepted by the Board.

Corporate Governance

Your Company has a rich legacy of ethical governance practices many of which were implemented by the Company, even before they were mandated by law. Your Company is committed to transparency in all its dealings and places high emphasis on business ethics.

Your Company continued to feature in the 'Leadership' category in the Corporate Governance Scorecard 2022 which is developed by Institutional Investor Advisory Services India Limited ("IiAS") with support from International Finance Corporation ("IFC") and BSE Limited ("BSE").

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

Compliance Management

The Company has adopted a compliance management tool which provides system-driven alerts to the respective owners for complying with the applicable laws and regulations. Certificates capturing the compliance status of all laws and regulations applicable to the Company are generated at the end of each quarter and submitted by the Managing Director to the Board.

Ethics Framework

The Company's revised Code of Conduct (the Code) for employees outlines the commitment to the principles of integrity, transparency, and fairness. The refreshed Code has been contemporised and aligned with the changes in the internal and the external environments. It enables the Company to make the right choices and demonstrate the highest standards of integrity and ethical behaviour.

The Ethics & Governance framework is also anchored by clearly defined policies and procedures, covering areas such as Anti-Bribery and Anti-Corruption Policy (ABAC), Policy on Gifts & Entertainment (G&E), Policy on Prevention of Sexual Harassment at Workplace (POSH), Whistle-Blower Policy (WB), Business Partner Code of Conduct, Supplier Code of Conduct to ensure robust Corporate Governance.

The Code of Conduct and all the Company's policies are accessible on the Company's website; in the Governance section at the Web-link: https://www.mahindra.com/investor- relations/policies-and-documents and on the Rise@Work the Company's intranet as well as on the mobile app Me-connect.

During the year, ABAC and G&E policies were revised to align it with global governance practices. An annual awareness program was implemented to enhance the understanding of the revised Code and policies. New joiners are mandatorily required to undertake e-learning modules on the Code, POSH and ABAC. For reinforcing Code and policies, existing employees are further required to complete mandatory e-Learning (refresher) modules on the Code of Conduct, and other policies viz; POSH, G&E and ABAC, annually. In addition to this, an Annual Compliance Declaration Module is mandated for the employees.

In order to achieve regular reinforcement of the Code and policies across the Company; the Ethics program has the support of 145 Ethics Counsellors who help the Company to amplify the values which the Company stands for and facilitate regular conversations and training with their cohorts. The Ethics Counsellors are trained by subject matter experts (internal / external) on ethics and policies throughout the year. During the year, they have trained approximately 3,500 employees and associates across various geographies on the Code and policies related to ABAC, G&E, POSH and WB. Further, your Company has driven sensitisation on the Code and other ethics policies vide ethical guidelines, emailers, videos, standees and posters across locations.

The Company's Vigil mechanism process is clearly defined for identifying and resolving breaches related to the Code of Conduct and the Company's Ethics Policies. It is regularly communicated throughout the Company vide the 'Speak Up campaign'. Data relating to such breaches are reviewed by the Corporate Governance Council and the Audit Committee that helps in determining the allocation of resources for future policy development, any review of policies, process improvement, training and awareness initiatives. The Corporate Governance Council ensures that the Ethics & Governance framework is executed effectively. The Group Ethics and Governance Committee and Business Ethics and Governance Committees help to ensure decisions on substantiated cases are taken in a fair, just and consistent manner across various functions of that business.

Vigil Mechanism

The Vigil Mechanism as envisaged in the Companies Act, 2013, the Rules prescribed thereunder, and the Listing Regulations is implemented through the Company's Whistle-Blower Policy. The Whistle-Blower Policy of your Company is available on the Company's website and can be accessed in the Governance section at the Web-link: https://www.mahindra.com/investor-relations/policies-and- documents.

It enables the Directors, employees and all stakeholders of the Company to report genuine concerns (about unethical behaviour, actual or suspected fraud, or violation of the Code) and provides for adequate safeguards against victimisation of persons who use such mechanism and makes provision for direct access to the Chairman of the Audit Committee.

A quarterly report on the whistle-blower complaints, as received, is placed before the Audit Committee for its review.

During the year, the Company received 147 whistle-blower complaints, out of which 132 complaints were investigated and appropriate actions were taken and investigations were underway for the remaining 15 complaints.

The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013

The Company has Zero Tolerance towards sexual harassment at the workplace. A detailed POSH Policy is in place as per the requirements of The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 ("Act"). The POSH Policy of the Company is available on the website of the Company and can be accessed in the Governance section at the Web-link: https://www.mahindra. com/investor-relations/policies-and-documents. All employees (permanent, contractual, temporary, trainees) as defined under the Act are covered in this Policy. The POSH Policy is gender inclusive and the framework ensures complete anonymity and confidentiality, the details of which may be referred to in the Board's Report.

Internal Complaints Committees ("ICC") have been constituted to redress complaints of sexual harassment and the Company has complied with the provisions relating to the constitution of ICC under the Act. While maintaining the highest governance norms, ICC are constituted for various locations. Half of the total members of the ICC are women. The external members with requisite experience in handling such matters are also part of the ICC. The ICC is presided over by a senior woman employee in each case. Inquiries are conducted and recommendations are made by the ICC at the respective locations. The ICC is updated on judicial trends and trained regularly on the nuances of the Act.

During the fiscal year under review, 9 complaints alleging sexual harassment were filed and 9 were resolved vide taking appropriate actions as per the provisions of the Act. No complaints are pending inquiry as of 31^st March, 2023.

Continuous awareness in this area has been created vide the POSH campaign reiterating Mahindra's commitment to providing a safe workplace to all its employees. During the year, the Company organised sensitization and awareness programs vide inductions for new joiners, e-learning modules for all employees, trainees, associates including sending emailers, creating standees and posters to sensitise all employees to conduct themselves in a professional manner. Further, virtual and classroom training sessions were conducted by the Company's Ethics Counsellors. The Company also organised offline leadership conversations on gender sensitisation and employee interactive sessions including conscious inclusions.

Business Responsibility and Sustainability Report

SEBI vide its Notification dated 5^th May, 2021 had amended Regulation 34 of the Listing Regulations, wherein SEBI has mandated that Business Responsibility Report ("BRR") shall be discontinued after the Financial Year 2021-22 and thereafter, with effect from the Financial Year 2022-23, the Top 1,000 listed entities based on market capitalization shall submit a Business Responsibility and Sustainability Report ("BRSR") in the format as specified by SEBI from time to time.

The Company has prepared the BRSR for the Financial Year 2022-23 in accordance with the format as prescribed in the SEBI Circular dated 10^th May, 2021.

The BRSR is intended towards having quantitative and standardized disclosures on ESG parameters to enable comparability across companies, sectors and time. Such disclosures will be helpful for investors to make better investment decisions. The BRSR shall also enable companies to engage more meaningfully with their stakeholders, by encouraging them to look beyond financials and towards social and environmental impacts.

The BRSR of your Company for the Financial Year 2022-23 forms part of this Annual Report as required under Regulation 34(2)(f) of the Listing Regulations.

Your Company strongly believes that sustainable and inclusive growth is possible by using the levers of environmental and social responsibility while setting aspirational targets and improving economic performance to ensure business continuity and rapid growth.

Your Company is committed to leverage 'Alternative Thinking' to build competitive advantage in achieving high shareholder returns through customer centricity, innovation, good governance and inclusive human development while being sensitive to the environment.

Risk Management

Your Company has a well-defined risk management framework in place. The risk management framework works at various levels across the enterprise. These levels form the strategic defence cover of the Company's risk management. The Company has a robust organizational structure for managing and reporting on risks.

Your Company has constituted a Risk Management Committee of the Board which is authorized to monitor and review risk management plan and risk certificate. The Committee is also empowered, inter alia, to review and recommend to the Board modifications to the Risk Management Policy. Further, the Board has constituted a Corporate Risk Council comprising the Senior Executives of the Company. The terms of reference of the Council include review of risks and Risk Management Policy at periodic intervals.

Your Company has developed and implemented a Risk Management Policy which is approved by the Board. The Risk Management Policy, inter alia, includes identification of risks, including cyber security and related risks and also those which in the opinion of the Board may threaten the existence of the Company. Risk management process has been established across the Company and is designed to identify, assess and frame a response to threats that affect the achievement of its objectives. Further, it is embedded across all the major functions and revolves around the goals and objectives of the organization.

Corporate Social Responsibility (CSR)

"Challenge conventional thinking and innovatively use all our resources to drive positive change in the lives of our stakeholders and communities across the world, to enable them to RISE."

Aligned with the above stated core purpose, for more than 75 years, your Company has been at the forefront of helping people RISE through impactful CSR projects that have addressed critical issues of our time. CSR for a business includes being responsible for its business processes and products, and engaging in accountable relationships with its employees, customers, and the community. Your Company has built its reputation as a good corporate citizen by not only doing good business, but also by driving positive change in society. For your Company, CSR is not only about adhering to statutory and legal compliances but also creating social and environmental value for its stakeholders thus contributing to build an equal and future-ready nation.

Your Company has a vibrant CSR portfolio that primarily serves the constituencies of girls and women and supports the environment through a massive tree plantation drive. It has delved into the tenets of Environment, Social and Governance (ESG) and has approached business conscientiously through sustainable and inclusive projects. For the Financial Year 2022-2023, your Company continued to focus on investing in girls, women, and tree plantations through high standard projects in the domains of education, skill development, and environment. This year your Company made special efforts in supporting women in rural as well as urban areas of India. Significant partnerships and strategies led to leveraging expertise and resources leading to greater social impact. As a thought leader and a pioneer in CSR, your Company has invested in transformational collaborations thereby enabling and empowering many more girls, women and farmers across the country to RISE.

The impact of some of the CSR projects your Company invested in for the Financial Year 2022-2023 are shown below:

- Project Nanhi Kali supported the education of 1,86,041 underprivileged girls through 7,674 Academic Support Centres across 22 Districts in 9 States of India. Of these, your Company continued to support 52,658 girls, which includes an additional 14,562 girls enrolled in FY 22-23, while the Mahindra Group in total supported 85,778 girls. Given the high dropout rates and learning gaps amongst teenage girls in India, Project Nanhi Kali also introduced training programmes in Life Skills and Digital Skills to empower underprivileged girls in this age group. Over 31,908 additional girls were trained under these initiatives across 2 states. Of these, the Mahindra Group supported 25,600 girls which included 15,000 girls supported by the Company.

- Mahindra Pride Classrooms: Mahindra Pride Classrooms continued to enhance employability skills of women through Mahindra Pride Classrooms conducted in Government colleges, ITIs and Polytechnic Institutes across 19 states in India. In FY23, the Mahindra Pride Classroom intervention transformed from a youth focussed initiative to a 100% women beneficiary programme and supported skills enhancement of 1,66,666 women in 1,697 colleges. Out of the total women, 1,03,699 women were supported through your Company. The programme also supported 1,256 men, leading to a total beneficiary count of 1,67,922 supported by Mahindra Group.

- Women based farm livelihood: PRERNA Under Prerna intervention, your Company continued to support 11,111 women farmers by training them in effective farming practices and advisory services including soil health, access to gender friendly farm equipment, linkages to Government welfare support initiatives, resource efficient agriculture methodologies, and increasing crop productivity. The intervention was undertaken across 6 states with predominant focus on rural community.

- Women Economic Empowerment through Regenerative Agriculture: The main objective of the programme was to enable women farmers to use regenerative agriculture as a technique to transform the soil on their land, increase productivity and earn profits throughout the year, in addition to ensuring food and nutrition security for their families. Through this project sponsored by your Company, 45,529 women farmers from Moga, Tarn Taran (Punjab),

Shravasti (UP) and Wardha (Maharashtra) were provided knowledge in regenerative organic farming practice. This intervention helped women farmers reduce their agriculture input cost and increase income from sale of crops.

- Women Economic Empowerment in ITES and Apparel Sector: In alignment to your Company's commitment to Women's Empowerment, new pilot projects were initiated to skill and provide employment opportunities for women in ITES and Apparel Sector. The objective of these pilots was to explore the potential job opportunities for women in these Sectors. Under this initiative, 7,076 women have been trained in the respective domain skills in the States of Telangana and Tamil Nadu, of these 6,232 women were trained by your Company.

- Project Hariyali aims to increase the green cover, arrest the rising ecological imbalance, protect the biodiversity and in the process support the livelihood of marginalized farmers. Through this intervention, the Mahindra Group planted 2.21 million trees in FY23. Your Company contributed towards plantation of 1.59 million trees, out of which 1.31 million trees were planted in the Araku Valley, which besides greening the environment also provided livelihood support to 3,275 tribal farmer families. Project Hariyali has been further extended in Northern India in the States of HP, UP and Punjab. With the plantation of more than 19 varieties of fruit, forest and shade trees, farmers are ensured a diversified source of income from these species of saplings planted. The farmers have been trained in global organic farming protocols which rejuvenate the soil, increase water retention and soil organic carbon. To date, 22.86 million trees have been planted through Mahindra Hariyali, of which 14.90 million trees have been planted in Araku which supports the livelihood of 26,000 tribal farmer families.

- Water Conservation: Your Company continued its efforts on Watershed Development Fund (WDF) and Climate Change Adaptation (CCA) Projects with NABARD in two locations:- (1) At Hatta, District Damoh, Madhya Pradesh for developing National Priority Areas of Aspirational District (2) Development of River Basin in Igatpuri Block, Nashik District, Maharashtra covering 34 villages with land area of 18,000 hectares. During FY23, your Company supported 7,939 farmers through various interventions of soil and water conservation works, crop diversification measures, livelihood training / support and drudgery reduction initiatives for Integrated Development of the rural catchment. Besides this, 5 States were covered under region specific water initiatives to cover 19,446 beneficiaries cumulatively.

- Employee Volunteering: Mahindra Group has a robust volunteering programme through the Employee Social Options (Esops) and MySeva platforms. While Esops programme is organised by the Mahindra Group, MySeva recognizes individual acts of Social Responsibility undertaken by Mahindra group employees. Through these employee volunteering platforms 55,873 employees invested 4,53,884.50 person hours of their personal time in numerous volunteering activities. Of these, 10,587 were employees of the Company who contributed 55,272 person hours towards a variety of social causes. At the group level, 1,46,721 person hours were invested through individual acts of Social Responsibility and the balance 3,07,163.50 person hours were contributed through Esops. A major development has been declaration of 5^th December as "Mahindra Volunteering Day". The very first Mahindra Volunteering Day celebrated on 5^th December, 2022 had 9,301 employees contributing 26,944 person hours.

During the Financial Year 2022-23, your Company was humbled to receive following awards for its contribution to the society:

1. Honorable Mention - Skill Development and Livelihood Category - National CSR Awards 2020 by Ministry of Corporate Affairs (Announced in August 2022)

2. Telangana State Industry Award - Silver Category for best CSR practice- Covid relief (March 2023)

3. Global CSR Excellence & Leadership Award 2023 - Winner in the 'Women Empowerment' Category (February 2023)

4. Best CSR Initiative "Project Pani" by ITOTY Awards (July 2022)

5. UBS Forum CSR Excellence Award 2022 for Community Health Project (November 2022)

6. CSR Times Award for Water Conservation Project (December 2022)

7. Best CSR Contribution Certificate by Government of Punjab (January 2023)

CSR Policy

The Corporate Social Responsibility Committee had formulated and recommended to the Board, a Corporate Social Responsibility Policy (CSR Policy) which was subsequently adopted by it and is being implemented by the Company. The CSR Policy including a brief overview of the projects or programs undertaken by the Company can be accessed in the Governance section at the web-link: https://www.mahindra. com/investor-relations/policies-and-documents.

CSR Committee

The CSR Committee comprises of Dr. Vishakha N. Desai (Chairperson), Mr. Anand G. Mahindra, Dr. Anish Shah, Mr. Vikram Singh Mehta and Mr. Muthiah Murugappan.

The Committee, inter alia, reviews and monitors the CSR as well as Business Responsibility and Sustainability activities.

The scope of the Committee was enhanced during the year by including in its Charter Environment, Social and Governance (ESG) related matters, the details of which are furnished in the Report on Corporate Governance that forms part of this Annual Report.

During the year under review, your Company spent Rs. 92.28 crores on CSR activities. The amount equal to 2% of the average net profit for the past three financial years required to be spent on CSR activities was Rs. 91.87 crores. The Board has considered the Impact Assessment Reports at its meeting held on 26^th May, 2023. The detailed Annual Report on the CSR activities undertaken by your Company in the Financial Year 2023 along with the Executive Summary for Impact Assessment Reports of the applicable projects, is annexed herewith and marked as Annexure VI.

The complete Impact Assessment Reports of the applicable projects can be accessed at the Web-link: https://www.mahindra.com/resources/FY23/AnnualReport.zip.

Sustainability

During the year under review, the 15^th Sustainability Report for the year 2021-22 was released. The Report was externally assured by KPMG and prepared in accordance with the GRI Standards - Core option.

The Company plans to build a 'Planet Positive Mahindra' by focusing on three key pillars, greening ourselves, decarbonizing the industry and rejuvenating nature. Under pillar greening ourselves, the Company focuses on enhancing use of renewable energy, improving energy and water productivity, embedding material circularity and ensuring no waste goes to landfill. To decarbonize the industry, transition to electric vehicles and alternate fuels, enabling supply chain to follow environment friendly practices and end of vehicle recycling are major considered aspects. Beyond the industry boundary, to rejuvenate nature, the Company aims regenerative farming, planting over million trees every year, investing in green technologies like solar, green buildings and micro irrigation.

ESG information of the Company has been disclosed under Dow Jones Sustainability Index (DJSI), Carbon Disclosure Project (CDP) and World Economic Forum's (WEF) stakeholder capitalism metrics.

Your Company has committed to Science Based Target, an initiative to restrict average global temperature rise in alignment of Paris Climate Change Agreement. The Mahindra Group is committed to become Carbon Neutral by 2040.

Senior leadership of the Company participated in various engagement programs like SEBI Advisory Committee on BRSR, Circular Economy Symposium by FICCI and WEF CEO Climate Alliance.

The Sustainability performance for your Company for the Financial Year 2022-23 will be elaborated in detail in the GRI Report which is under preparation and will be ready for release shortly.

Your Company was recognized for its leadership position on the ESG dimensions during the year under review, by way of the following:

• Only Automobile Company globally disclosing Core & Expanded metrics as per WEF's Stakeholder Capitalism Metrics during the year 2022.

• Part of Dow Jones Sustainability World & Emerging Market Indices, for the 2^nd consecutive year thereby being the only Indian automobile company to do so.

• Felicitated by CDP as Supplier Engagement Leader for the year 2022.

• Inclusion in S&P Global Sustainability Yearbook 2023.

Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo

The information pertaining to conservation of energy, technology absorption, foreign exchange earnings and outgo as required under section 134(3)(m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 is attached as Annexure VII and forms part of this Report.

Share Capital

During the year under review, the Authorised Share Capital of the Company stood increased to Rs. 11,681.5 crores divided into 2031,30,00,000 Ordinary (Equity) Shares of Rs. 5 each and 25,00,000 Unclassified shares of Rs. 100 each and 150,00,00,000 Preference Shares of Rs. 10 each pursuant to the Scheme of Merger by Absorption of Mahindra Engineering and Chemical Products Limited, Retail Initiative Holdings Limited and Mahindra Retail Limited with the Company becoming effective from 29^th April, 2022.

The Authorised Share Capital of the Company further stands increased to Rs. 12,681.5 crores divided into 2231,30,00,000 Ordinary (Equity) Shares of Rs. 5 each and 25,00,000 Unclassified shares of Rs. 100 each and 150,00,00,000 Preference Shares of Rs. 10 each pursuant to the Scheme of Merger by Absorption of Mahindra Electric Mobility Limited ("MEML") with the Company and their respective shareholders ("MEML Scheme") becoming effective on 2^nd February, 2023.

The issued, subscribed and paid-up Share Capital of the Company was increased from Rs. 621.60 crores comprising of 124,31,92,544 Ordinary (Equity) Shares of Rs. 5 each fully paid-up to Rs. 621.76 crores divided into 124,35,28,831 Ordinary (Equity) shares of Rs. 5 each upon allotment of 3,36,287 Ordinary (Equity) shares of Rs. 5 each to the shareholders of MEML on 23^rd February, 2023 pursuant to the MEML Scheme.

Compliance with the provisions of Secretarial Standard 1 and Secretarial Standard 2

The applicable Secretarial Standards, i.e. SS-1 and SS-2, relating to 'Meetings of the Board of Directors' and 'General Meetings' respectively, have been duly complied by your Company.

Annual Return

Pursuant to section 134(3)(a) and section 92(3) of the Companies Act, 2013 read with Rule 12(1) of the Companies (Management and Administration) Rules, 2014, a copy of the Annual Return is placed on the website of the Company and can be accessed at https://www.mahindra.com/resources/FY23/ AnnualReport.zip.

0. POLICIES

The details of the Key Policies adopted by the Company are mentioned at Annexure VIII to the Board's Report.

P. PROCEEDINGS UNDER THE INSOLVENCY AND BANKRUPTCY CODE, 2016 (31 OF 2016)

There were two proceedings initiated / pending against your Company under the Insolvency and Bankruptcy Code, 2016 which do not materially impact the business of the Company. While in one case the Company has filed its detailed reply and the matter is pending for final hearing, the other matter is still under objection.

Q. GENERAL

Neither the Managing Director nor the Executive Director received any remuneration or commission from any of the subsidiaries of your Company.

Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions / events on these items during the year under review:

1. Issue of equity shares with differential rights as to dividend, voting or otherwise.

2. Issue of Shares (including Sweat Equity Shares) to employees of the Company under any Scheme save and except Employees Stock Option Schemes (ESOS) referred to in this Report.

3. Significant or material orders passed by the Regulators or Courts or Tribunals which impact the going concern status and the Company's operation in future.

4. Voting rights which are not directly exercised by the employees in respect of shares for the subscription / purchase of which loan was given by the Company (as there is no scheme pursuant to which such persons can beneficially hold shares as envisaged under section 67(3)(c) of the Companies Act, 2013).

5. There has been no change in the nature of business of your Company.

6. The Company has not made any one-time settlement for loans taken from the Banks or Financial Institutions, and hence the details of difference between amount of the valuation done at the time of one time settlement and the valuation done while taking loan from the Banks or Financial Institutions along with the reasons thereof is not applicable.

7. There was no revision of financial statements and Board's Report of the Company during the year under review.