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Directors Report of Mahindra & Mahindra Ltd.

Mar 31, 2023

Your directors are pleased to present the Thirty Sixth Annual Report along with the audited accounts of your Company for the year ended March 31, 2023.

FINANCIAL RESULTS (STANDALONE)

('' in Million)

For the year ended March 31

2023

2022#

Income

437,856

372,079

Profit Before Interest, Depreciation and Tax

58,978

72,383

Interest

(1,808)

(689)

Depreciation

(8,129)

(7,403)

Profit Before Tax

49,041

64,291

Provision for Taxation

(11,266)

(14,058)

Profit After Tax

37,775

50,233

Other Comprehensive Income

(2,480)

1,200

Balance brought forward from previous year

216,090

203,329

Profit available for appropriation

253,917

253,292

Equity Dividends

(46,705)1

(43,624)1

Transfer to retained earnings on account of options lapsed

99

74

Transferred from Special Economic Zone re-investment reserve on utilization

7,151

6,348

Balance carried forward

214,462

216,090

# - Figures for the previous year are restated after considering the amalgamation of Tech Mahindra Business Services Limited and Born Commerce Private Limited with the Company.

1 Interim Dividend (Special Dividend) for the Financial Year ended March 31, 2023 and Final Dividend for the Financial Year ended March 31,2022

DIVIDEND

The Board of Directors on November 1, 2022 approved a special interim dividend of '' 18/- per share (i.e. 360%) on the par value of '' 5/- each which was paid by the Company to the shareholders whose names appeared in the Register of Members as on November 10, 2022, being the record date for the payment of dividend. Your Directors are pleased to recommend a final dividend of '' 32/- per share on par value of '' 5/- (i.e. 640%), payable to those Shareholders whose names appear in the Register of Members as on the Book Closure Date. Thus, the total dividend for the FY 2022-23 will be '' 50/- per share (i.e. 1000%) against the dividend of '' 45/- per share (i.e. 900%) paid for the Financial Year 2021-22.

The Board of your Company decided not to transfer any amount to the General Reserve for the year under review.

Your Company has formulated a Dividend Policy which is disclosed on the website of the Company and can be accessed at https://insights.techmahindra.com/ investors/tml-dividend-distribution-policy.pdf

SHARE CAPITAL

During the year under review, your Company allotted 2,313,996 equity shares on the exercise of stock options under various Employee Stock Option Schemes. Consequently, the issued, subscribed and paid-up equity share capital has increased from '' 4,859.17 million divided into 971,833,479 equity shares of '' 5/- each to '' 4,870.74 million divided into 974,147,475 equity shares of '' 5/- each.

ALTERATION OF ‘CAPITAL CLAUSE’ OF MEMORANDUM OF ASSOCIATION

Consequent to the merger of Tech Mahindra Business Services Limited and Born Commerce Private Limited with the Company, the Authorised Capital of the

Company increased from '' 8,336.50 million divided into 1,667,300,000 equity shares of '' 5/- each to '' 9,093 million divided into 1,818,600,000 equity shares of '' 5/- each.

Accordingly, the Capital Clause of the Memorandum of Association of the Company was altered and substituted with the new Clause V to reflect the corresponding changes in the Authorised Share Capital.

BUSINESS PERFORMANCE / FINANCIAL OVERVIEW

Imperative for businesses and your Company to stay relevant is the need to be cognizant of the tectonic shifts occurring around the world. Technological innovations, climate change and the need for inclusive growth and representation among others is defining the way organization’s function. Tech Mahindra has remained on the forefront of all cutting-edge technological advancements and harnessed many emerging technologies to transform customer and employee experiences. Your Company’s execution strategy is indexed to the pillars of client focus, portfolio synergy, operational rigor, new age technology bets and people transformation.

During the Financial Year ended on March 31, 2023, the Company’s revenues grew to '' 532,902 million on a consolidated basis as against '' 446,460 million in the previous year - indicating a robust growth of 19.4%. The growth was broad based across geographies as both Americas and Europe contributed in line with overall business growth. The Company also saw healthy growth across business segments in Communications, Media and Entertainment (CME) and Enterprise verticals.

The EBITDA on a consolidated basis for the Financial Year 2023 was '' 80,288 million, similar to the previous year’s EBITDA of '' 80,200 million. The resultant EBITDA margins were in the range of 15.1% in FY 2023 compared to 18.1% in FY 2022. The post-tax profit of the Company was reduced to '' 48,313 million in FY 2023 as against '' 55,661 million in FY 2022.

The Company saw robust demand for digital transformation services with a focus on customer experience and cloud. The Company has seen new deal wins close to USD 3,000 million during the year, indicating a healthy growth momentum across all business verticals. Your Company’s investments in Enterprise SaaS and Hi-tech capabilities will help

it cater to increasing modernization demands from businesses in the Financial Year 2024 and beyond.

MATERIAL CHANGES AND COMMITMENTS AFFECTING FINANCIAL POSITION BETWEEN THE END OF THE FINANCIAL YEAR AND THE DATE OF THE REPORT

There have been no material changes and commitments which affect the financial position of the Company that have occurred between the end of the financial year to which the financial statements relate and the date of this report.

ACQUISITIONS

Your company made the following acquisition during the FY 2022-23.

THIRDWARE SOLUTIONS LIMITED

The Company acquired 100% of the share capital of Thirdware Solutions Limited ("Thirdware”) on June 3, 2022 at a consideration up to USD 42 million including earnouts. Thirdware is a global player in Enterprise Applications and will enhance the Company’s digital solutions and services in automotive consultant and design, development and implementation in areas like ERP (Enterprise Resource Planning), EPM (Enterprise Performance Management), RPA (Robotic Process Automation) and IloT (Industrial Internet of Things). These capabilities will give the Company an edge in the manufacturing space.

UPDATE ON MERGER

Your directors at their meeting held on January 31, 2021 approved the Scheme of Merger of Tech Mahindra Business Services Limited (TMBSL) and Born Commerce Private Limited (Born) with the Company with the appointed date as April 1, 2021.

Hon’ble NCLT, Mumbai bench and Hon’ble NCLT, Chennai bench vide their order dated January 5, 2023 and January 12, 2023 respectively, approved the scheme of merger by absorption of the TMBSL and Born with the Company and their respective shareholders and the said Scheme has become effective on February 16, 2023.

SUBSIDIARIES, ASSOCIATES AND JOINT VENTURES OF THE COMPANY

The performance and financial position of the subsidiaries, associates, and joint venture companies included in the consolidated financial statement is provided in accordance with the provisions of Section

129 read with Rule 5 of the Companies (Accounts) Rules, 2014 containing the salient features of the financial statement of the Company’s subsidiaries/joint ventures or associate companies in Form AOC - 1 in “Annexure I” to this report.

Pursuant to Rule 8(5)(iv) of the Companies (Accounts) Rules, 2014, the names of the companies which have been incorporated or ceased to be the subsidiaries, joint ventures or associate companies during the year are provided in “Annexure II” to this report. The Company is actively pursuing the initiative on the consolidation of its subsidiaries/branches to optimize the operational costs. During the year under review, your Company has closed/merged twenty subsidiaries.

HUMAN RESOURCES

The employees of the Company are the most critical asset to your Company. The Company has taken several steps to protect, retain, and improve the competencies of these assets including:

Hiring: Forecast to Fulfilment

Your Company has streamlined its talent hiring process adopting some best-in-class practices. By building predictability in talent planning & forecasting for new age skills, your Company has been able to fuel business growth. Your Company has revamped its Buddy Referral programs to recruit talent from existing employee networks while offering attractive incentives. Embracing diversity in the hiring process has improved the global and local representation of talent within the organization. The Company has also redesigned its Candidate Engagement process to focus on creating positive experiences from the issuing joining offer letter to internal deployment to client projects. With rigor in talent allocation and proactive skilling of bench talent, your Company has been able to increase its internal fulfilment to 71% from 48% which is the best in the industry.

Learning: Skilling on the job

With the growth in digital business, your Company has been transforming its workforce both at speed and scale. The Company accelerated skilling initiatives to keep up with the pace of technological developments and built a ‘future-ready’ talent pool. #NAD Learn, the Al-based platform with interactive, on-demand, contextual and hyper-personalised up-skilling is helping the Company develop full-stack professionals. Your Company has supplemented this with young leadership development programs as well

as new policies to promote niche skilling and fast-track career growth. Employees can learn and grow as a Fresher through Elevate, in customer deployments through Project Skilling, for career progression through Future Skilling and into the leadership pipeline through journey-based programs. The Company also offers super-specialization skilling programs including Architect CoE, HiPOT programs at units and Program Manager CoE through EMBARK. Some new programs that the Company has recently launched for high-potential talent development include MALT and TrIBE.

Leadership: Integrative Thinking

The natural culture of empowerment that was supercharged during the pandemic continues to be the mainstay in the current hybrid work environment. Your Company aims to help employees imbibe mindsets & behaviors for the future which include a renewed focus on Integrative Thinking, Business & Financial Acumen, Bias for Action, Closure over Follow-up, Data over Emotions and Extreme Ownership. This was reinforced through the adoption of an industry leading learning platform - Harvard Manage Mentor Spark aimed at imparting best-in-class training at every level in realtime. Your Company has a robust Talent Management process for developing the leadership talent pipeline and has adopted consistent coaching practices for managers. Apart from Coaching, the employees have experienced new forms of learning with technology-enabled tools and pedagogies. For example, the ‘Wheel of Life’ is a customized self-coaching tool with gamified journeys, and personalized Habit Tracking making personal and professional well-being goals accessible to every employee.

Performance: Feedback focused

Your Company launched the Annual Performance Feedback cycle in December 2022. In order to build a culture where performance is enabled through feedback, Managers have been trained to have better performance review dialogues with their direct reports and work on an outcome-based evaluation rather than process or effort measurement. Your Company is creating a High-Performance Culture through hyper-personalized Incentive plans. Your Company has a suite of Incentive plans that are designed to create a strong alignment between Individual growth and Organization performance.

Wellness: Collective well-being

Your Company puts a happier, healthier and more productive workforce at the core of its business, policies and decisions. Your Company has designed

initiatives covering eight dimensions of wellness -Physical, Occupational, Emotional, Spiritual, Social, Environmental, Financial and Intellectual. The focus on preventative care with Corporate paid preventive health check, on-campus doctor consultations & counselling programs, helps employees diagnose any health condition in advance. To tackle IT industry specific issues, the Company organizes wellness sessions on Ergonomics, Healthy eating, Lifestyle management etc. Multiple tech-enabled wellness interventions like Kick the Butt (Smoking Cessation Program), Bend it like TechM (Guide to Ergonomics), Dump the Plump (Weight loss challenge) etc. have helped employees create healthier habits. Through the People Care program, managers are encouraged to show their human side and empower their team members to pursue collective well-being.

Communication: Building purpose

A robust communication process is at the heart of the Company’s vibrant culture. Employees are kept connected and informed through multiple media. Your Company’s 360-degree communication framework ensures employees have access to connect with leaders, peers and the external world. With publications, platforms, storytelling, campaigns, and connects, the organizational culture is shared with all. Your Company shares stories of diverse individuals achieving extraordinary things using structured formats like #RiseFromWithin. Leaders in the Company share not just business updates and success stories but personal anecdotes that reinforce the belief of a shared destiny.

Engagement: Hybrid connects

For an increasingly hybrid workplace, the Company has designed several virtual ‘water-cooler’ moments like All Hand Meets with CXO, Prime Time, Location Connects etc. along with family connects. Employees have platforms like MS Teams and Cisco WebEx for collaborative yet decentralized working. Your Company also organized on-ground engagement linked to TechM’s FIDE partnership for the Chess Olympiad. TechM CARES Action Planning workshops were also organized across different business units to implement changes based on employee feedback. Your Company also organized more than 1,200 engagement programs globally linked to Rise Refresh.

Rise Refresh: #TogetherWeRise

For more than a decade, the Rise philosophy has inspired employees from across the Mahindra Group to come to work and build something meaningful.

Since then, the world has changed with the rise of disruptive technologies, changing start-up ecosystem, climate change and recently, the pandemic. This is why, the Company has defined a new core purpose and brand pillars of Rise to simplify and sharpen its commitments. Your Company has leveraged every possible medium to ensure that this is communicated to all employees. From the conventional posters, communities, blogs, leader-bytes, microsite, quizzes and signatures route to the unconventional music, memes, WhatsApp stickers, GenZ lingo, podcast conversations and comic strips, Rise has touched the heart of every employee.

Diversity: Respecting Individuality

Your Company believes that respecting diversity and ensuring inclusion is fundamentally the right thing to do. It respects, embraces and celebrates the uniqueness of every individual. This also links back to the stated objective of the Company to be human-centered by encouraging associates to bring their most authentic selves to work. Your Company initiated the Maternity Assistance Program (MAP) to support employees who were on Maternity Leave in their transition back to work. The Company has also organized several Fireside chats featuring women with STEAM (Science, Technology, Engineering, Arts, Mathematics) roles to inspire others to grow in these fields. Through the ‘Restart’ Program, the Company aims to help Women IT Professionals restart their career after a break.

Recognition: Appreciation always

Your Company believes in appreciating, recognizing, and celebrating by building a culture where good work and behavior are appreciated. The Company has designed specialized recognition programs where rewards, tenure, performance, and contribution are celebrated, often with the loved ones of employees. The recognition program is centered around n = 1, that is, the individual at the heart of everything. A key part of personalizing recognition is to bring it to the desk of every employee. This is enabled by the KUDOS portal that offers recognition badges as well as redemption options for the points earned. Giving employees the ability to appreciate colleagues and sustained campaigns have led your Company to have an industry leading rewards penetration of ~74% including monetary and non-monetary recognition. Tenure is rewarded with personalized gifts for both the employee and their family members. Lastly, there are several organizational level awards for outstanding achievements like the ACE, STAR, Location Council and Spotlight awards.

HR Digitization: Experiencing technology

Your Company has revolutionized employee experience by deploying technology at different touchpoints of their lifecycle. Your Company continued its internal automation focus by using Robotic Process Automation for completing common workforce actions to reduce manual work. Your Company has also integrated HR Chatbot UVO and Technical Support Chatbot ATOM into MS Teams making it easier to perform workforce actions like leave applications, pending approvals, ticket registrations etc. Developing an "Attrition Prediction Model” has provided Your Company with an early warning system predicting the employees’ likelihood to quit, giving the Business HR team the ability to stage an intervention. The Company has also explored the use of Metaverse where three dimensional avatars interact in a virtual world to develop modules for hiring and on-boarding. Translating these experiences to mobile devices, the Company has developed ‘The Wheel of Life’ application as a self-coaching tool.

QUALITY

The Company continues its focus on quality and strives to exceed customer expectations at all times. During the year, it continued to strengthen the implementation of Quality systems and upgraded the processes/systems to comply with CMMI V 2.0 for both Development and Services and currently assessed for maturity level 5. Similarly it underwent various upgrade and re-certification audits for multiple standards during the year in order to meet client demands and enhance value delivery - successfully re-certified, ISO 9001:2015 (Quality Management System), ISO 20000-1:2018 (Information Technology Service Management System), ISO 27001:2013 (Information Security Management System), ISO 27701:2019 (Privacy Information Management System), TL9000 R 6.2/ R5.7 (Quality Management Systems for Tele Communications industry), ISO 13485:2016 (Quality Management Systems for medical devices - scope of certification limited to medical devices business within Tech Mahindra), AS9100 Rev D (Standard for Aerospace domain - scope of certification limited to the aerospace business within Tech Mahindra), ISO 17025:2017 - Laboratory Quality Management Systems for our device testing labs.

In addition to these, your Company also maintains its commitment to health, safety and environment by continually improving its processes in accordance with ISO 14001:2015 (Environmental Management System) and ISO 45001: 2018 (Occupational Health and Safety

Assessment Series) standards. Your Company is also certified on ISO 22301:2012 (Societal Security and Business Continuity Management System) and has a comprehensive Business Continuity and Disaster Recovery framework, to prevent potential business disruptions in the event of any disaster. It has processes that helped resume services to customer’s acceptable service levels. Automated Service Desk with SLAs for enabling business and Vulnerability Assessment and Penetration Testing Lab for secured corporate network operations are highlights that showcase the information security posture of the Organization.

Tech Mahindra (IT Division) has been assessed for the implementation of high maturity business excellence practices at Mahindra Group (Services Sector). It has been assessed at TMW Maturity Stage 7 (on scale of 1-10 stages) of Mahindra Business Excellence Framework - The Mahindra Way. These certifications are testimony of the robustness of business processes and at large, the quality culture imbibed in the organization.

Your Company has institutionalized the Deliverability Risk Assessment (DRA) practice - to assess the readiness and to identify risks at the beginning of the program, continued to strengthen the process for transforming Quality Assurance processes & delivery methods to adopt and strengthen Delivery excellence, Risk governance, and further enhance automation to enable quality delivery to the customer. Quality index which is a measure of quality of products and services delivery is institutionalized.

The Company is ensuring all these initiatives are in place, to ensure that it delivers as stated in its Quality Policy.

DIRECTORS

During the year under review, all Independent Directors have given declarations that they meet the criteria of Independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Independent Directors have also given declaration of compliance with Rules 6(1) and 6(2) of the Companies (Appointment and Qualification of Directors) Rules, 2014, with respect to their name appearing in the data bank of Independent Directors maintained by the Indian Institute of Corporate Affairs.

Pursuant to the provisions of Section 152(6)(c) of the Companies Act, 2013, Mr. Manoj Bhat, Director (DIN: 05205447) is liable to retire by rotation and being eligible offers himself for reappointment.

During the year under review, Ms. Penelope Fowler (DIN: 09591815) was appointed as Additional Director by the Board of Directors of the Company on May 13, 2022. She was further appointed as an Independent Director pursuant to the special resolution passed by the shareholders at the Annual General Meeting held on July 26, 2022 for a period of 5 years.

In view of the retirement of Mr. C. P Gurnani, Managing Director and CEO, the Board of Directors at its meeting held on June 15, 2023, based on the recommendation of the Nomination and Remuneration Committee approved the Appointment of Mr. Mohit Joshi, (DIN: 08339247) as Additional Director with effect from June 20, 2023 to hold office up to the date of ensuing Annual General Meeting. Further in order to ensure smooth transition into the role of Managing Director as Mr. C. P. Gurnani would retire on December 19, 2023, Mr. Mohit Joshi was also appointed as a Whole Time Director designated as Managing Director (Designate) and Key Managerial Personnel with effect from June 20, 2023 up to December 19, 2023 subject to the approval of the members of the Company and the Central Government.

The Board of Directors, based on the recommendation of Nomination and Remuneration Committee also approved the appointment of Mr. Mohit Joshi as Managing Director & Chief Executive Officer of the Company and Key Managerial Personnel under the Companies Act, 2013 from December 20, 2023 to June 19, 2028 (both days inclusive), subject to approval of the members of the Company and the Central Government.

The Board recommends the appointment of Mr. Manoj Bhat and Mr. Mohit Joshi to the Members at the ensuing Annual General Meeting. The brief profile of Mr. Manoj Bhat and Mr. Mohit Joshi is given in the Notice of the Annual General Meeting.

In terms of Regulation 24(1) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations 2015, Mr. T. N. Manoharan, Lead Independent Director of the Company has been appointed as Director on the Board of Tech Mahindra (Americas) Inc., a wholly

owned unlisted material subsidiary of the Company with effect from May 21, 2019.

In the opinion of the Board of Directors, the Independent Directors have relevant proficiency, expertise and experience.

FAMILIARISATION PROGRAMME

These programmes aim to provide insights into the Company to enable the Independent Directors to understand its business in depth and contribute significantly to the Company. The details of the program for familiarisation of the Independent Directors with the Company are available on its website and can be accessed at https://insights.techmahindra.com/ investors/tml-familarisation-progarmmes-for-IDs.pdf

The Board of Directors are regularly updated on changes in statutory provisions like amendments in Corporate Laws, SEBI Regulations, Taxation Laws and People related laws as applicable at the quarterly Board meetings. The Board members are also updated on the Risk universe applicable to the Company’s business. The MD & CEO of the Company had quarterly sessions with Board members sharing updates about the Company’s business strategy, operations and the key trends in the IT industry that are relevant to the Company. These updates help the Board members in keeping abreast of key changes and their impact on the Company. Further Subject Knowledge Experts from various fields are also invited to the meetings of the Board/Committees to appraise the Board Members of the latest developments in the IT and the business.

TRAINING

The Company has laid down a policy on the training of Independent Directors as part of its governance policies. The Senior Leadership of the Company periodically updates the Directors on regulatory changes, business strategy and operations.

BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and Regulation 19 read with Schedule II, Part D of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has devised a policy on evaluating the performance of the Board of Directors, the Chairman, Committees, and Individual Directors. The evaluation process was carried out through a web-based portal. The summary of the evaluation reports

was presented to the respective Committees and the Board. The Directors had given positive feedback on the overall functioning of the Committees and the Board. The suggestions made by the Directors in the evaluation process have been suitably incorporated in the processes.

NUMBER OF MEETINGS OF THE BOARD

The Board met five times during the Financial Year 2022-23. The meeting details are provided in the Corporate Governance report that forms part of this Annual Report. The maximum interval between any two meetings did not exceed 120 days as prescribed in the Companies Act, 2013 and SEBI Listing Regulations.

COMMITTEES OF THE BOARD

As on March 31, 2023, the Board has constituted seven Committees, namely, Audit Committee, Nomination and Remuneration Committee, Stakeholders Relationship Committee, Risk Management Committee, Corporate Social Responsibility Committee, Investment Committee and Securities Allotment Committee. The details of terms of reference of each Committee and the meetings held during the year are given in the Corporate Governance Report.

The Company has also formed Group Governance Council comprising of Board Members and Senior Management in terms of the SEBI Circular No. SEBI/ HO/CFD/CMD/CIR /P/2018/79 dated May 10, 2018, considering it has a large number of subsidiaries.

POLICY ON DIRECTORS’ APPOINTMENT AND REMUNERATION

The Governance policies laid down by the Board of Directors of your Company include:

i. Policy on the appointment and removal of Directors, Key Managerial Personnel and Senior Management.

ii. Policy on remuneration to the Directors, Key Managerial Personnel and Senior Management and other Employees.

The extract of these two policies is provided in "Annexure III”.

The policies are available on the website of the Company and can be accessed at https://insights. techmahindra.com/investors/Governance-Policies-including-remuneration-to-Directors-KMPS.pdf

SUCCESSION PLAN

In accordance with the principles of transparency and consistency, your Company has adopted governance policies for appointments, remuneration and evaluation of its Board of Directors, Key Managerial Personnel & Senior Management. In line with these Governance policies, the Company has established a formal Succession Planning Program for Key Managerial Personnel across the organization. The Board evaluates all such plans at a regular interval and institutes a formal program for filling any such critical position. The Board evaluates both internal and external candidates for such positions along with the recommendations of the management. The Company also has a leadership development program where it identifies high potential managers, and trains them to take up the positions of higher responsibility. The Company has identified the second line of leadership, which provides stability to the business in case of contingencies.

KEY MANAGERIAL PERSONNEL (KMP)

Pursuant to provisions of Section 203 of the Companies Act, 2013, Mr. C. P. Gurnani, Managing Director & Chief Executive Officer, Mr. Milind Kulkarni, Chief Financial Officer (up to May 31, 2022), Mr. Rohit Anand, Chief Financial Officer (w.e.f. June 1, 2022) and Mr. Anil Khatri, Company Secretary & Compliance Officer were the Key Managerial Personnel of the Company during the year under review.

DIRECTORS’ RESPONSIBILITY STATEMENT

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

i. in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

ii. they have, in the selection of the accounting policies, consulted the Statutory Auditors and these have been applied consistently and, reasonable and prudent judgments and estimates have been made so as to give a true and fair view of the state of affairs of the Company as at March 31, 2023 and of the profit of the Company for the year ended on that date;

iii. proper and sufficient care had been taken 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 other irregularities;

iv. the annual accounts have been prepared on a going concern basis;

v. they had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively;

vi. the proper systems to ensure compliance with the provisions of all applicable laws are in place and are adequate and operating effectively.

DETAILS WITH RESPECT TO ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS

The Company has internal financial controls which are adequate and were operating effectively. The controls are adequate for ensuring the orderly and efficient conduct of the business, including adherence to the Company’s policies, the safeguarding of assets, the prevention and detection of frauds and errors, the accuracy and completeness of accounting records and timely preparation of reliable financial information.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS / PROCEEDINGS

There are no significant and material orders passed by the regulators or courts or tribunal, impacting the going concern status and the Company’s operations in the future.

Further no application against the Company has been filed or is pending under the Insolvency and Bankruptcy Code, 2016, nor has the Company done any one-time settlement with any Bank or Financial institutions.

STATUTORY AUDITORS

The members, in the 35th Annual General Meeting (AGM) held on July 26, 2022, appointed M/s. B S R & Co. LLP, Chartered Accountants, [ICAI Firm’s Registration No. 101248W/W- 100022] as the Statutory Auditors of the Company, to hold office for a further term of five consecutive years from the conclusion of the 35th AGM of the Company held in

the Financial Year 2021-22 until the conclusion of the AGM of the Company for the Financial Year 2026-27 on such remuneration as may be determined by the Board of Directors.

There are no qualifications, reservations, adverse remarks or disclaimers made in the audit report for the Financial Year 2022-23.

SECRETARIAL AUDIT REPORT

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 had appointed Makarand Lele & Co., Practicing Company

Secretary, Pune to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is available at "Annexure IV” to this report. There are no qualifications, reservations, adverse remarks or disclaimers made in the Secretarial Audit Report.

COMPLIANCE WITH SECRETARIAL

STANDARDS

The Company has complied with the applicable Secretarial Standards.

ANNUAL RETURN

Pursuant to the provisions of Section 92(3) read with Section 134(3) (a) of the Companies Act, 2013, the Annual Return in Form MGT-7 is available on the website of the Company and can be accessed at https://insights.techmahindra.com/investors/mgt-7.pdf

INVESTOR EDUCATION AND PROTECTION FUND (IEPF)

During the year, the Company has transferred the unclaimed dividends of '' 2,13,40,674 to the Investor Education and Protection Fund. Further, 2,26,700 corresponding shares on which dividends were unclaimed for seven consecutive years were transferred to the fund as per the requirements of the IEPF Rules. The Members are requested to check the details of the unpaid dividend on the website of the Company and claim their dividend to avoid the shares from being transferred to IEPF.

MANAGERIAL REMUNERATION

Disclosures of the ratio of the remuneration of each director to the median employee’s remuneration and other details as required pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of

Managerial Personnel) Rules, 2014 as amended from time to time, are provided as "Annexure V”. None of the Directors or the Managing Director & CEO of the Company received any remuneration or commission from Subsidiary Companies of your Company.

The details of remuneration paid to the Directors including the Managing Director & CEO of the Company are provided in the Corporate Governance Report.

PARTICULARS OF EMPLOYEES

The information required under Section 197(12) of the Companies Act, 2013 ("the Act”) read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms part of this Report. However, pursuant to first proviso to Section 136(1) of the Act, this report is being sent to the Shareholders excluding the aforesaid information. Any shareholder interested in obtaining said information may write to the Company Secretary at the Registered Office / Corporate Office of the Company and the said information is open for inspection at the Registered Office of the Company.

POLICY ON PREVENTION OF SEXUAL HARASSMENT

Your Company has laid down the Prevention of Sexual Harassment (POSH) policy which is available on its website. The Company has zero tolerance on Sexual Harassment at workplace. During the year under review, there were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

The status of complaints received under POSH and redressed by the POSH Committee of the Company, during the Financial Year under review, are given below:

a) Number of complaints received during the year - 74

b) Number of complaints redressed during the year - 73@

c) Number of complaints pending for redressal as on March 31, 2023 - 3

@ - Includes 2 complaints received during the previous year and redressed during the year.

There are focused campaigns on the POSH policy within the Company and awareness drives that

take place. Furthermore, employees are required to undertake a mandatory certification on POSH to sensitize themselves and strengthen their awareness.

EMPLOYEE STOCK OPTION SCHEMES

During the year under review, there were no material changes in the Employee Stock Option Schemes (ESOPs) of the Company and the Schemes are in compliance with the SEBI Regulations on ESOPs.

As per Regulation 14 of Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021, the details of the ESOPs are uploaded on the website of the Company and can be accessed at https://insights.techmahindra. com/investors/details-of-esops-fy-2022-23.pdf

CORPORATE GOVERNANCE

A report on Corporate Governance covering among others composition of the Board of Directors, details of meetings of the Board and Committees along with a certificate for compliance with the conditions of Corporate Governance in accordance with the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, issued by the Statutory Auditors of the Company, forms part of this Annual Report.

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.

BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT (BRSR)

SEBI, vide its circular dated May 10, 2021, made BRSR mandatory for the top 1,000 listed companies (by market capitalization) with effect from the FY 2022-23. The Company voluntarily published BRSR for the Financial year 2021-22. The BRSR Report for the year 2022-23 is enclosed as part of this Annual Report.

In addition to the BRSR, the Integrated Annual Report of the Company provides an insight on the various ESG initiatives adopted by the Company. The ESG disclosures have been independently assured by KPMG.

COST RECORDS

Maintenance of cost records and requirement of cost audit as prescribed under the provisions of Section 148(1) of the Companies Act, 2013 are not applicable for the business activities of the Company.

RISK MANAGEMENT

The Risk Management Committee of the Board of Directors devised a Risk Management Policy and guides the operating management to identify risks, analyze their probability and impact and prepare mitigation plans. It periodically reviews the Risk Management Framework & Enterprise Risk Register which is presented by the Chief Risk Officer. The Company identifies all potential risks viz. economic, business, currency, operations, climate, governance, finance, cyber, business continuity etc. and prepares a mitigation plan for each of the risks. The elements of risk as identified by the Company with the impact and mitigation strategy are set out in the Management Discussion and Analysis Report.

ESTABLISHMENT OF VIGIL MECHANISM

The Company has laid down Whistle Blower Policy covering Vigil Mechanism with protective clauses for the Whistle Blowers. The Whistle Blower Policy is made available on the website of the Company.

DEPOSITS / LOANS & ADVANCES, GUARANTEES OR INVESTMENTS

The Company has not accepted any deposits from the public during the year under review. The particulars of loans/advances, guarantees and investments under Section 186 of the Companies Act, 2013 are given in the notes forming part of the Financial Statements.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All transactions entered with Related Parties as defined under Section 2(76) of the Companies Act, 2013 and Regulation 23 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, ("The Listing Regulations”), during the financial year under review were in the ordinary course of business and at an arm’s length pricing basis and do not attract the provisions of Section 188 of the Companies Act, 2013. There were no transactions with related parties in the Financial Year which conflicted with the interest of the Company and required compliance of the provisions of Regulation 23 of the Listing Regulations.

Suitable disclosure as required by the Indian Accounting Standards (Ind AS 24) has been made in the notes forming part of the Financial Statements.

The Company has formulated a policy on the Related Party Transactions and dealing with Related Party Transactions which has been uploaded on the website of the Company and can be accessed at https:// insights.techmahindra.com/investors/Related-Party-Transactions-Policy.pdf

The particulars of related party transactions in prescribed Form AOC - 2 are attached as ‘Annexure VI”. Pursuant to Regulation 23(9) of the Listing Regulations, your Company has filed half yearly report on Related Party Transactions with the stock exchanges.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars as prescribed under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 are provided in "Annexure VII” which forms part of this report.

CORPORATE SOCIAL RESPONSIBILITY

The CSR vision of the Company is "Empowerment through Education.”

In compliance with the guidelines prescribed under Section 135 of the Companies Act, 2013, your Company has constituted a Corporate Social Responsibility (CSR) Committee of the Board. The CSR policy, covering the Objectives, Focus Areas, Governance Structure Monitoring and Reporting Framework among others is approved by the Board of Directors. In accordance with the amendments made in Section 135 in January 2021, the CSR Policy has been duly revised and is available on the website of the Company and can be accessed at https://insights. techmahindra.com/investors/tml-csr-policy-23.pdf

The Company has spent more than 2% of the average net profits of the Company during the three immediately preceding Financial Years on CSR.

The Company’s social initiatives are mainly carried out by Tech Mahindra Foundation and Mahindra Educational Institutions, Section 8 (erstwhile Section 25) Companies promoted by the Company.

TECH MAHINDRA FOUNDATION (TMF) EDUCATION

The key initiatives taken by TMF in the arena of school education include:

ALL ROUND IMPROVEMENT IN SCHOOL EDUCATION (ARISE)

Tech Mahindra Foundation’s educational initiatives under ARISE are long-term school improvement programmes, in partnership with local governments and partner organisations. The Foundation in 2022-23 worked with 18 government primary & secondary schools to transform them into model schools of excellence. A total of 5,224 students were positively impacted under this programme, of which 2,832 were girls.

During the year, the Foundation expanded its work for children with special needs through its ARISE programme. This programme is a variant of ARISE in which children with special needs are provided chronic therapy as well as special education to help them lead more fulfilling lives. Through 32 projects, the programme enabled 4,829 children with special needs to become better learners with greater independence in managing their lives. The Foundation has taken up the provision of assistive technology for these children as an important value addition to its work in ARISE .

SHIKSHAANTAR

Shikshaantar, envisioned as a programme for enhancing the capacity of government school teachers, has emerged as an important programme in the education portfolio of the Foundation. TMF works with the Municipal Corporation of Delhi by running their In-Service Teacher Education Institutes. With the merger of the MCDs, TMF now has the responsibility of training teachers from close to 1,500 primary schools in Delhi. During the year under review, as many as 4,379 teachers were trained as part of Shikshaantar. This included specially designed modules for Digital Literacy, Child Safety, Cyber Security and Mental Health that were delivered to the teachers in a hybrid mode.

MOBILE SCIENCE LAB & ROBOTICS LAB

In order to increase the footprint of its work in Education and reach the unreached, TMF launched a unique initiative in 2019-20 - The Mobile Science Lab (MSL). For this, a Mahindra bus has been remodeled to become a science lab on wheels and has been travelling from school to school in East Delhi to provide STEM learning for children in grades 3 and 4 in these

schools. The MSL program benefitted as many as 6,861 students and 77 teachers throughout the year.

Following the success of the MSL program, TMF has also set up a Robotics Lab at one of its ARISE schools in Delhi which is an all-girls school. This lab was inaugurated in November 2022, and nearly 300 girls from this school are the potential beneficiaries.

EMPLOYABILITY

Skills-for-Market Training (SMART) is the Foundation’s flagship programme in employability. It is built on the vision of an educated, enabled and empowered India, and the belief that educated and skilled youth are the country’s true strength. The programme started with 3 Centres in 2012 and is currently running over 85 Centres at 10 locations across India. These include SMART Centres, SMART Centres (training for people with disabilities), and SMART-T Centres (training in technical trades).

In 2022-23, your Company trained 17,641 young women and men under its SMART program, of which, 1,303 were persons with disabilities. More than 70% of the graduates are placed in jobs across multiple industries upon successful completion of the training. The average salaries being earned by the graduates of the SMART program have been steadily rising and saw a 10% jump over the previous year.

The Foundation’s commitment to setting new benchmarks in skill development in India has been underscored by the setting up of Tech Mahindra SMART Academies, which provide the highest quality of skill training to youngsters in Healthcare and Digital Technologies. During FY 2022-23, 3,584 students were trained at the nine Academies that are now functional - 5 in Healthcare, 3 in Digital Technologies, and 1 in Logistics.

TMF’S OUTREACH INITIATIVES

In addition to all the core programs described above, Tech Mahindra Foundation is now also implementing several outreach projects in collaboration with various agencies. As part of these, the TMF team members are engaged in activities such as community health initiatives, teacher training, provision of content for other large-scale projects, etc. As part of such outreach projects, TMF supported 20,734 beneficiaries, taking the total tally of direct beneficiaries for the year to 61,995. This is nearly 50% more than the number of direct beneficiaries for FY 2021-22, which stood at 41,374.

MAHINDRA EDUCATIONAL INSTITUTIONS (MEI)

MEI - a not-for-profit, 100% subsidiary of the Company has set up Mahindra Ecole Centrale in August 2014 - through a collaborative venture between Mahindra Educational Institutions and Ecole Centrale of Paris, France (now known as Centrale Supelec) and the JNTU Hyderabad - to offer undergraduate engineering programs. Through this strong Indo-French Collaboration with Centrale Supelec and Industry connect with Tech Mahindra, MEC has emerged as a disruptive player in the field of Technical Education.

MEI has sponsored the setting up of Mahindra University to introduce diverse streams of education in addition to Engineering. Further the Engineering stream is being transitioned to Mahindra University.

MAHINDRA UNIVERSITY (MU)

Mahindra University ("MU”) (sponsored by Mahindra Educational Institutions, ("MEI”) - a not-for-profit, 100% subsidiary of Tech Mahindra), was notified on May 20, 2020 by the Government of Telangana vide The Telangana State Private Universities (Establishment and Regulation) Act, 2018 for "educating future citizens for and of a better world”.

The Ecole Centrale School of Engineering (ECSoE) currently runs various UG, PG and Ph.D. programs in cutting-edge engineering departments. ECSoE also launched a Centre for Life Sciences and offers courses in biotechnology and computational biology under it. The school plans to launch the 2.5 year integrated programs in Biotechnology & CSE for AY 2023-24.

Cornell University’s SC Johnson College of Business, an ivy league institution is the "Academic Partner” for School of Management. Mahindra University’s School of Management (MU - SoM) will benefit significantly from Cornell University’s expertise in curriculum development, faculty exchange programs including some specialty courses delivery by the Cornell faculty to Mahindra University students, as well as student immersion at Cornell. The School of Management currently conducts BBA, BA, E-MBA, and MBA (starting in 2023) programs.

The School of Law, Mahindra University, commenced operations in September 2021 in Hyderabad offering 5-year integrated programs in BA LL.B and BBA LL.B. It was founded on the philosophy of securing justice, equality, and service to all sections of society. With the needs of modern society evolving rapidly, there is a renewed focus on the importance of the discipline of

law. The School of Law will aim to make a difference to the legal profession and practice by providing a diverse, flexible curriculum and pedagogy, touching on several aspects of domestic and international law, while appraising the students of the latest trends in academia and practice. Starting 2022, the School of Law has launched a 3-year LLB (Hons) program and intend to launch a 6-year integrated B.Tech LLB course starting Academic Year 2023.

The University also plans to launch the following programs/schools for the Academic Year 2023-24:

1. School of Media

a. 4-year B.Tech. (Computation & Media)

b. 3-year BA (Digital Media & Communication)

2. School of Hotel Management

a. 3-year B.Sc. (Hospitality & Hotel Administration)

In the academic year 2022, a total of 2,971 students were studying under various programs across all schools and departments. The new admissions for academic year 2022 are 1,236 students of which 1,128 students are in various UG programs, including School of Management and School of Law, 22 students in the PG programs of School of Engineering and 86 students in the Ph.D programs across all the schools.

The Annual Report on CSR activities is provided as "Annexure VIII”.

SUSTAINABILITY

Your Company aligns closely with the Mahindra Group’s ambition to Rise: Be People positive, Planet positive, and Trust positive. The Company holistically embraces ever greater responsibility towards protecting the environment, empowering the society, and providing good governance.

Your Company’s strategy for creating long-term sustainable value is by improving, scaling, and transparently communicating our ecological, social, and economic impacts. Our strong governance framework led by the Board of Directors of your Company, who have oversight of the Company’s overall strategy and future direction and ensures the planning and implementation of environmental and social programs.

The Company’s holistic approach enables to drive sustainable impact in alignment with leading global frameworks, initiatives, and agendas committed to furthering sustainability such as the TCFD, SASB, GRI, as well as the Paris Agreement, the UNGC and the UN SDGs.

As a business, the Company recognizes the value of following the UN SDGs (Sustainable Development Goals) of People, Planet, Prosperity, and Partnership and continues to create value through initiatives that cater directly to these aspects of our performance.

People:

• Great place to work: Working to enhance our organizational culture by enabling our associates with access to advanced technologies, providing Learning & Development opportunities to help develop their skills and areas of expertise and providing them with robust career development programmes.

• Work-life balance: Providing feasible and flexible work-life balance and integration along with a range of associate-friendly policies and processes to reduce attrition.

• Diversity and inclusion: Ensuring that our organization continues to transcend into the realms of gender diversity and includes people with disabilities as well as people from the LGBTQIA community as part of being a socially responsible business.

• Employee engagement & recognition:

Ensuring our associates are engaged, feel valued, and recognized through a robust performance management system, a flexible system of working, and an extensive system of benefits and perquisites.

• Individual Social Responsibility: Encouraging associates to contribute to the society & environment and make these activities an integral part of their day-to-day activities.

Planet:

• Carbon neutrality and Net zero: Committing to carbon neutrality (2030) and Net zero (2035) by switching to renewable energy through on site installations and open access; improving energy efficiency through installation of LEDs, sensors; boosting green investments by

implementing Carbon Price; optimizing business travel by enabling virtual meetings; encouraging use of public transport and carpooling to reduce employee commute emissions; carbon sequestration through tree plantation; moving towards a low carbon economy by optimizing operations to ensure environmental protection.

• No waste to landfill: Installing Organic Waste Converters and vermicomposting plants at own campuses to convert food waste to manure, cutting down their transportation emissions and reducing waste to landfill.

• No to plastic: Maintaining plastic-free campuses and encouraging all stakeholders to use ecofriendly and biodegradable materials. Spreading awareness and initiating campaigns on preventing single-use plastic.

• Reduce, Reuse, Recycle, Recover: Implementing the process of Reduce, Reuse, Recycle and Recover across the value chain to limit waste and enable a circular economy.

• Being water positive: Improving water efficiency and increasing water savings by using water sensors, restrictors and water-efficient coolers, recycling wastewater through STPs, and recharging groundwater levels with Rainwater Harvesting Pits.

• Promoting Biodiversity: Protecting local flora and fauna across all our locations to ensure that we do not adversely impact biodiversity through our operations.

Prosperity:

• Innovation: Embracing technology and innovation by incorporating IoT, Blockchain, AI and Machine Learning to develop a portfolio of sustainable solutions that help reduce emissions and other negative impacts of climate change.

• Green solutions: Investing in Sustainability reporting solution (i.Sustain) and Climate Risk Management platforms, Smart grid, Microgrid-As-A-Service, Community Action Platform for Energy, Integrated Electric Vehicle Charging systems (IEVCS), Smart data hubs and Smart Cities for our Customers to reduce their carbon emissions.

• Connecting with customers: Embracing brand equity by connecting with our customers to address their current and future needs and ensuring customer satisfaction.

Partnership

• Learning and Sharing: Partnering with collaborators & partner companies to create an alliance ecosystem and supplement each other’s capabilities on joint projects. Collaborating with academia, businesses, NGOs, and governments to address some of the global challenges like health care, climate change, inequality, etc.

• Sustainable supply chain: Ensuring that we are in synch with our value chain in our commitment towards climate action and helping our suppliers follow the highest standards of sustainable and ethical best practices within their own organizations.

Tech Mahindra has drafted its Integrated Annual report in accordance with Global Reporting standards and frameworks with the data assured by a third party thus complying with the highest transparency standards.

The Company’s progress against the sustainability targets and metrics are disclosed in the externally assured Integrated reports available on the website of the company- https://www.techmahindra.com/en-in/ sustainability/

AWARDS AND RECOGNITION

Your Company continued its quest for excellence in its chosen area of business to emerge as a true global brand. Several awards and rankings continue to endorse your Company as a thought leader in the industry. A few of the prominent Awards / recognitions received by the Company during the Financial Year 2022-23 include:

• Tech Mahindra won several medals in the USA for its people practices- Brandon Hall HCM Excellence Awards, Stevie Awards for Great Employers and was also included in the 2023 Bloomberg Gender-Equality Index (GEI).

• Tech Mahindra Philippines was certified as a Great Place to Work.

• The Economic Times bestowed Tech Mahindra with several recognitions including Great Manager Awards (People Business), Human Capital Awards and ‘Best Organizations for Women’ (Femina).

• Tech Mahindra was also recognized by Avtar and Seramount as "Champions” in Most Inclusive Companies Index and "Top 10” in Best Companies for Women in India.

• Dun & Bradstreet India recognized Tech Mahindra as a top performer in the ESG Performance -Software and BPM sector.

• Tech Mahindra won Frost & Sullivan’s Technology Innovation Leadership Award 2022 for Metaverse Technology Services.

• Tech Mahindra was recognized among the Iconic brands at ET Iconic Brands 2022.

• TechM amplifAI0->^ is awarded "Cool Product or Service of the Year in Business 2022.” at the 12th Annual 2022 Business Excellence Awards by Globee® Business Awards.

• Tech Mahindra MEA was recognized for Ground-breaking products/services in Ecommerce at GITEX.

• Tech Mahindra was awarded ‘A’ rating in MSCI ESG ratings 2022.

• Tech Mahindra received the "Mahatma Award 2022 for Social Good & Impact - Decent Work and Economic Growth” for its SMART Program.

These awards are a reflection of the Company’s continued efforts in the fields of business, sustainability, human resource management and its sustained progress towards creating a better society for all.

ACKNOWLEDGEMENTS

Your directors place on records their appreciation for the contributions made by employees towards the success of your Company. Your directors gratefully acknowledge the co-operation and support received from the shareholders, customers, vendors, bankers, Regulatory and Governmental authorities in India and abroad.

For and on behalf of the Board

Anand G. Mahindra Place: Mumbai Chairman

Date: 15th June, 2023 (DIN: 00004695)

Note: The Board of Directors at its meeting held on April 27, 2023, had approved the financial statements for the financial year 2023 and the Director''s Report along with the Annexures. However, in view of the appointment of Mr. Mohit Joshi as Additional Director and Whole Time Director, the revised Director''s Report was approved by the Board at its Meeting held on June 15, 2023.

1

Interim Dividend (Special Dividend) for the Financial Year ended March 31, 2022 and Final Dividend for the Financial Year ended March 31, 2021


Mar 31, 2023

Your directors are pleased to present the Thirty Sixth Annual Report along with the audited accounts of your Company for the year ended March 31, 2023.

FINANCIAL RESULTS (STANDALONE)

('' in Million)

For the year ended March 31

2023

2022#

Income

437,856

372,079

Profit Before Interest, Depreciation and Tax

58,978

72,383

Interest

(1,808)

(689)

Depreciation

(8,129)

(7,403)

Profit Before Tax

49,041

64,291

Provision for Taxation

(11,266)

(14,058)

Profit After Tax

37,775

50,233

Other Comprehensive Income

(2,480)

1,200

Balance brought forward from previous year

216,090

203,329

Profit available for appropriation

253,917

253,292

Equity Dividends

(46,705)1

(43,624)1

Transfer to retained earnings on account of options lapsed

99

74

Transferred from Special Economic Zone re-investment reserve on utilization

7,151

6,348

Balance carried forward

214,462

216,090

# - Figures for the previous year are restated after considering the amalgamation of Tech Mahindra Business Services Limited and Born Commerce Private Limited with the Company.

1 Interim Dividend (Special Dividend) for the Financial Year ended March 31, 2023 and Final Dividend for the Financial Year ended March 31,2022

DIVIDEND

The Board of Directors on November 1, 2022 approved a special interim dividend of '' 18/- per share (i.e. 360%) on the par value of '' 5/- each which was paid by the Company to the shareholders whose names appeared in the Register of Members as on November 10, 2022, being the record date for the payment of dividend. Your Directors are pleased to recommend a final dividend of '' 32/- per share on par value of '' 5/- (i.e. 640%), payable to those Shareholders whose names appear in the Register of Members as on the Book Closure Date. Thus, the total dividend for the FY 2022-23 will be '' 50/- per share (i.e. 1000%) against the dividend of '' 45/- per share (i.e. 900%) paid for the Financial Year 2021-22.

The Board of your Company decided not to transfer any amount to the General Reserve for the year under review.

Your Company has formulated a Dividend Policy which is disclosed on the website of the Company and can be accessed at https://insights.techmahindra.com/ investors/tml-dividend-distribution-policy.pdf

SHARE CAPITAL

During the year under review, your Company allotted 2,313,996 equity shares on the exercise of stock options under various Employee Stock Option Schemes. Consequently, the issued, subscribed and paid-up equity share capital has increased from '' 4,859.17 million divided into 971,833,479 equity shares of '' 5/- each to '' 4,870.74 million divided into 974,147,475 equity shares of '' 5/- each.

ALTERATION OF ‘CAPITAL CLAUSE’ OF MEMORANDUM OF ASSOCIATION

Consequent to the merger of Tech Mahindra Business Services Limited and Born Commerce Private Limited with the Company, the Authorised Capital of the

Company increased from '' 8,336.50 million divided into 1,667,300,000 equity shares of '' 5/- each to '' 9,093 million divided into 1,818,600,000 equity shares of '' 5/- each.

Accordingly, the Capital Clause of the Memorandum of Association of the Company was altered and substituted with the new Clause V to reflect the corresponding changes in the Authorised Share Capital.

BUSINESS PERFORMANCE / FINANCIAL OVERVIEW

Imperative for businesses and your Company to stay relevant is the need to be cognizant of the tectonic shifts occurring around the world. Technological innovations, climate change and the need for inclusive growth and representation among others is defining the way organization’s function. Tech Mahindra has remained on the forefront of all cutting-edge technological advancements and harnessed many emerging technologies to transform customer and employee experiences. Your Company’s execution strategy is indexed to the pillars of client focus, portfolio synergy, operational rigor, new age technology bets and people transformation.

During the Financial Year ended on March 31, 2023, the Company’s revenues grew to '' 532,902 million on a consolidated basis as against '' 446,460 million in the previous year - indicating a robust growth of 19.4%. The growth was broad based across geographies as both Americas and Europe contributed in line with overall business growth. The Company also saw healthy growth across business segments in Communications, Media and Entertainment (CME) and Enterprise verticals.

The EBITDA on a consolidated basis for the Financial Year 2023 was '' 80,288 million, similar to the previous year’s EBITDA of '' 80,200 million. The resultant EBITDA margins were in the range of 15.1% in FY 2023 compared to 18.1% in FY 2022. The post-tax profit of the Company was reduced to '' 48,313 million in FY 2023 as against '' 55,661 million in FY 2022.

The Company saw robust demand for digital transformation services with a focus on customer experience and cloud. The Company has seen new deal wins close to USD 3,000 million during the year, indicating a healthy growth momentum across all business verticals. Your Company’s investments in Enterprise SaaS and Hi-tech capabilities will help

it cater to increasing modernization demands from businesses in the Financial Year 2024 and beyond.

MATERIAL CHANGES AND COMMITMENTS AFFECTING FINANCIAL POSITION BETWEEN THE END OF THE FINANCIAL YEAR AND THE DATE OF THE REPORT

There have been no material changes and commitments which affect the financial position of the Company that have occurred between the end of the financial year to which the financial statements relate and the date of this report.

ACQUISITIONS

Your company made the following acquisition during the FY 2022-23.

THIRDWARE SOLUTIONS LIMITED

The Company acquired 100% of the share capital of Thirdware Solutions Limited ("Thirdware”) on June 3, 2022 at a consideration up to USD 42 million including earnouts. Thirdware is a global player in Enterprise Applications and will enhance the Company’s digital solutions and services in automotive consultant and design, development and implementation in areas like ERP (Enterprise Resource Planning), EPM (Enterprise Performance Management), RPA (Robotic Process Automation) and IloT (Industrial Internet of Things). These capabilities will give the Company an edge in the manufacturing space.

UPDATE ON MERGER

Your directors at their meeting held on January 31, 2021 approved the Scheme of Merger of Tech Mahindra Business Services Limited (TMBSL) and Born Commerce Private Limited (Born) with the Company with the appointed date as April 1, 2021.

Hon’ble NCLT, Mumbai bench and Hon’ble NCLT, Chennai bench vide their order dated January 5, 2023 and January 12, 2023 respectively, approved the scheme of merger by absorption of the TMBSL and Born with the Company and their respective shareholders and the said Scheme has become effective on February 16, 2023.

SUBSIDIARIES, ASSOCIATES AND JOINT VENTURES OF THE COMPANY

The performance and financial position of the subsidiaries, associates, and joint venture companies included in the consolidated financial statement is provided in accordance with the provisions of Section

129 read with Rule 5 of the Companies (Accounts) Rules, 2014 containing the salient features of the financial statement of the Company’s subsidiaries/joint ventures or associate companies in Form AOC - 1 in “Annexure I” to this report.

Pursuant to Rule 8(5)(iv) of the Companies (Accounts) Rules, 2014, the names of the companies which have been incorporated or ceased to be the subsidiaries, joint ventures or associate companies during the year are provided in “Annexure II” to this report. The Company is actively pursuing the initiative on the consolidation of its subsidiaries/branches to optimize the operational costs. During the year under review, your Company has closed/merged twenty subsidiaries.

HUMAN RESOURCES

The employees of the Company are the most critical asset to your Company. The Company has taken several steps to protect, retain, and improve the competencies of these assets including:

Hiring: Forecast to Fulfilment

Your Company has streamlined its talent hiring process adopting some best-in-class practices. By building predictability in talent planning & forecasting for new age skills, your Company has been able to fuel business growth. Your Company has revamped its Buddy Referral programs to recruit talent from existing employee networks while offering attractive incentives. Embracing diversity in the hiring process has improved the global and local representation of talent within the organization. The Company has also redesigned its Candidate Engagement process to focus on creating positive experiences from the issuing joining offer letter to internal deployment to client projects. With rigor in talent allocation and proactive skilling of bench talent, your Company has been able to increase its internal fulfilment to 71% from 48% which is the best in the industry.

Learning: Skilling on the job

With the growth in digital business, your Company has been transforming its workforce both at speed and scale. The Company accelerated skilling initiatives to keep up with the pace of technological developments and built a ‘future-ready’ talent pool. #NAD Learn, the Al-based platform with interactive, on-demand, contextual and hyper-personalised up-skilling is helping the Company develop full-stack professionals. Your Company has supplemented this with young leadership development programs as well

as new policies to promote niche skilling and fast-track career growth. Employees can learn and grow as a Fresher through Elevate, in customer deployments through Project Skilling, for career progression through Future Skilling and into the leadership pipeline through journey-based programs. The Company also offers super-specialization skilling programs including Architect CoE, HiPOT programs at units and Program Manager CoE through EMBARK. Some new programs that the Company has recently launched for high-potential talent development include MALT and TrIBE.

Leadership: Integrative Thinking

The natural culture of empowerment that was supercharged during the pandemic continues to be the mainstay in the current hybrid work environment. Your Company aims to help employees imbibe mindsets & behaviors for the future which include a renewed focus on Integrative Thinking, Business & Financial Acumen, Bias for Action, Closure over Follow-up, Data over Emotions and Extreme Ownership. This was reinforced through the adoption of an industry leading learning platform - Harvard Manage Mentor Spark aimed at imparting best-in-class training at every level in realtime. Your Company has a robust Talent Management process for developing the leadership talent pipeline and has adopted consistent coaching practices for managers. Apart from Coaching, the employees have experienced new forms of learning with technology-enabled tools and pedagogies. For example, the ‘Wheel of Life’ is a customized self-coaching tool with gamified journeys, and personalized Habit Tracking making personal and professional well-being goals accessible to every employee.

Performance: Feedback focused

Your Company launched the Annual Performance Feedback cycle in December 2022. In order to build a culture where performance is enabled through feedback, Managers have been trained to have better performance review dialogues with their direct reports and work on an outcome-based evaluation rather than process or effort measurement. Your Company is creating a High-Performance Culture through hyper-personalized Incentive plans. Your Company has a suite of Incentive plans that are designed to create a strong alignment between Individual growth and Organization performance.

Wellness: Collective well-being

Your Company puts a happier, healthier and more productive workforce at the core of its business, policies and decisions. Your Company has designed

initiatives covering eight dimensions of wellness -Physical, Occupational, Emotional, Spiritual, Social, Environmental, Financial and Intellectual. The focus on preventative care with Corporate paid preventive health check, on-campus doctor consultations & counselling programs, helps employees diagnose any health condition in advance. To tackle IT industry specific issues, the Company organizes wellness sessions on Ergonomics, Healthy eating, Lifestyle management etc. Multiple tech-enabled wellness interventions like Kick the Butt (Smoking Cessation Program), Bend it like TechM (Guide to Ergonomics), Dump the Plump (Weight loss challenge) etc. have helped employees create healthier habits. Through the People Care program, managers are encouraged to show their human side and empower their team members to pursue collective well-being.

Communication: Building purpose

A robust communication process is at the heart of the Company’s vibrant culture. Employees are kept connected and informed through multiple media. Your Company’s 360-degree communication framework ensures employees have access to connect with leaders, peers and the external world. With publications, platforms, storytelling, campaigns, and connects, the organizational culture is shared with all. Your Company shares stories of diverse individuals achieving extraordinary things using structured formats like #RiseFromWithin. Leaders in the Company share not just business updates and success stories but personal anecdotes that reinforce the belief of a shared destiny.

Engagement: Hybrid connects

For an increasingly hybrid workplace, the Company has designed several virtual ‘water-cooler’ moments like All Hand Meets with CXO, Prime Time, Location Connects etc. along with family connects. Employees have platforms like MS Teams and Cisco WebEx for collaborative yet decentralized working. Your Company also organized on-ground engagement linked to TechM’s FIDE partnership for the Chess Olympiad. TechM CARES Action Planning workshops were also organized across different business units to implement changes based on employee feedback. Your Company also organized more than 1,200 engagement programs globally linked to Rise Refresh.

Rise Refresh: #TogetherWeRise

For more than a decade, the Rise philosophy has inspired employees from across the Mahindra Group to come to work and build something meaningful.

Since then, the world has changed with the rise of disruptive technologies, changing start-up ecosystem, climate change and recently, the pandemic. This is why, the Company has defined a new core purpose and brand pillars of Rise to simplify and sharpen its commitments. Your Company has leveraged every possible medium to ensure that this is communicated to all employees. From the conventional posters, communities, blogs, leader-bytes, microsite, quizzes and signatures route to the unconventional music, memes, WhatsApp stickers, GenZ lingo, podcast conversations and comic strips, Rise has touched the heart of every employee.

Diversity: Respecting Individuality

Your Company believes that respecting diversity and ensuring inclusion is fundamentally the right thing to do. It respects, embraces and celebrates the uniqueness of every individual. This also links back to the stated objective of the Company to be human-centered by encouraging associates to bring their most authentic selves to work. Your Company initiated the Maternity Assistance Program (MAP) to support employees who were on Maternity Leave in their transition back to work. The Company has also organized several Fireside chats featuring women with STEAM (Science, Technology, Engineering, Arts, Mathematics) roles to inspire others to grow in these fields. Through the ‘Restart’ Program, the Company aims to help Women IT Professionals restart their career after a break.

Recognition: Appreciation always

Your Company believes in appreciating, recognizing, and celebrating by building a culture where good work and behavior are appreciated. The Company has designed specialized recognition programs where rewards, tenure, performance, and contribution are celebrated, often with the loved ones of employees. The recognition program is centered around n = 1, that is, the individual at the heart of everything. A key part of personalizing recognition is to bring it to the desk of every employee. This is enabled by the KUDOS portal that offers recognition badges as well as redemption options for the points earned. Giving employees the ability to appreciate colleagues and sustained campaigns have led your Company to have an industry leading rewards penetration of ~74% including monetary and non-monetary recognition. Tenure is rewarded with personalized gifts for both the employee and their family members. Lastly, there are several organizational level awards for outstanding achievements like the ACE, STAR, Location Council and Spotlight awards.

HR Digitization: Experiencing technology

Your Company has revolutionized employee experience by deploying technology at different touchpoints of their lifecycle. Your Company continued its internal automation focus by using Robotic Process Automation for completing common workforce actions to reduce manual work. Your Company has also integrated HR Chatbot UVO and Technical Support Chatbot ATOM into MS Teams making it easier to perform workforce actions like leave applications, pending approvals, ticket registrations etc. Developing an "Attrition Prediction Model” has provided Your Company with an early warning system predicting the employees’ likelihood to quit, giving the Business HR team the ability to stage an intervention. The Company has also explored the use of Metaverse where three dimensional avatars interact in a virtual world to develop modules for hiring and on-boarding. Translating these experiences to mobile devices, the Company has developed ‘The Wheel of Life’ application as a self-coaching tool.

QUALITY

The Company continues its focus on quality and strives to exceed customer expectations at all times. During the year, it continued to strengthen the implementation of Quality systems and upgraded the processes/systems to comply with CMMI V 2.0 for both Development and Services and currently assessed for maturity level 5. Similarly it underwent various upgrade and re-certification audits for multiple standards during the year in order to meet client demands and enhance value delivery - successfully re-certified, ISO 9001:2015 (Quality Management System), ISO 20000-1:2018 (Information Technology Service Management System), ISO 27001:2013 (Information Security Management System), ISO 27701:2019 (Privacy Information Management System), TL9000 R 6.2/ R5.7 (Quality Management Systems for Tele Communications industry), ISO 13485:2016 (Quality Management Systems for medical devices - scope of certification limited to medical devices business within Tech Mahindra), AS9100 Rev D (Standard for Aerospace domain - scope of certification limited to the aerospace business within Tech Mahindra), ISO 17025:2017 - Laboratory Quality Management Systems for our device testing labs.

In addition to these, your Company also maintains its commitment to health, safety and environment by continually improving its processes in accordance with ISO 14001:2015 (Environmental Management System) and ISO 45001: 2018 (Occupational Health and Safety

Assessment Series) standards. Your Company is also certified on ISO 22301:2012 (Societal Security and Business Continuity Management System) and has a comprehensive Business Continuity and Disaster Recovery framework, to prevent potential business disruptions in the event of any disaster. It has processes that helped resume services to customer’s acceptable service levels. Automated Service Desk with SLAs for enabling business and Vulnerability Assessment and Penetration Testing Lab for secured corporate network operations are highlights that showcase the information security posture of the Organization.

Tech Mahindra (IT Division) has been assessed for the implementation of high maturity business excellence practices at Mahindra Group (Services Sector). It has been assessed at TMW Maturity Stage 7 (on scale of 1-10 stages) of Mahindra Business Excellence Framework - The Mahindra Way. These certifications are testimony of the robustness of business processes and at large, the quality culture imbibed in the organization.

Your Company has institutionalized the Deliverability Risk Assessment (DRA) practice - to assess the readiness and to identify risks at the beginning of the program, continued to strengthen the process for transforming Quality Assurance processes & delivery methods to adopt and strengthen Delivery excellence, Risk governance, and further enhance automation to enable quality delivery to the customer. Quality index which is a measure of quality of products and services delivery is institutionalized.

The Company is ensuring all these initiatives are in place, to ensure that it delivers as stated in its Quality Policy.

DIRECTORS

During the year under review, all Independent Directors have given declarations that they meet the criteria of Independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Independent Directors have also given declaration of compliance with Rules 6(1) and 6(2) of the Companies (Appointment and Qualification of Directors) Rules, 2014, with respect to their name appearing in the data bank of Independent Directors maintained by the Indian Institute of Corporate Affairs.

Pursuant to the provisions of Section 152(6)(c) of the Companies Act, 2013, Mr. Manoj Bhat, Director (DIN: 05205447) is liable to retire by rotation and being eligible offers himself for reappointment.

During the year under review, Ms. Penelope Fowler (DIN: 09591815) was appointed as Additional Director by the Board of Directors of the Company on May 13, 2022. She was further appointed as an Independent Director pursuant to the special resolution passed by the shareholders at the Annual General Meeting held on July 26, 2022 for a period of 5 years.

In view of the retirement of Mr. C. P Gurnani, Managing Director and CEO, the Board of Directors at its meeting held on June 15, 2023, based on the recommendation of the Nomination and Remuneration Committee approved the Appointment of Mr. Mohit Joshi, (DIN: 08339247) as Additional Director with effect from June 20, 2023 to hold office up to the date of ensuing Annual General Meeting. Further in order to ensure smooth transition into the role of Managing Director as Mr. C. P. Gurnani would retire on December 19, 2023, Mr. Mohit Joshi was also appointed as a Whole Time Director designated as Managing Director (Designate) and Key Managerial Personnel with effect from June 20, 2023 up to December 19, 2023 subject to the approval of the members of the Company and the Central Government.

The Board of Directors, based on the recommendation of Nomination and Remuneration Committee also approved the appointment of Mr. Mohit Joshi as Managing Director & Chief Executive Officer of the Company and Key Managerial Personnel under the Companies Act, 2013 from December 20, 2023 to June 19, 2028 (both days inclusive), subject to approval of the members of the Company and the Central Government.

The Board recommends the appointment of Mr. Manoj Bhat and Mr. Mohit Joshi to the Members at the ensuing Annual General Meeting. The brief profile of Mr. Manoj Bhat and Mr. Mohit Joshi is given in the Notice of the Annual General Meeting.

In terms of Regulation 24(1) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations 2015, Mr. T. N. Manoharan, Lead Independent Director of the Company has been appointed as Director on the Board of Tech Mahindra (Americas) Inc., a wholly

owned unlisted material subsidiary of the Company with effect from May 21, 2019.

In the opinion of the Board of Directors, the Independent Directors have relevant proficiency, expertise and experience.

FAMILIARISATION PROGRAMME

These programmes aim to provide insights into the Company to enable the Independent Directors to understand its business in depth and contribute significantly to the Company. The details of the program for familiarisation of the Independent Directors with the Company are available on its website and can be accessed at https://insights.techmahindra.com/ investors/tml-familarisation-progarmmes-for-IDs.pdf

The Board of Directors are regularly updated on changes in statutory provisions like amendments in Corporate Laws, SEBI Regulations, Taxation Laws and People related laws as applicable at the quarterly Board meetings. The Board members are also updated on the Risk universe applicable to the Company’s business. The MD & CEO of the Company had quarterly sessions with Board members sharing updates about the Company’s business strategy, operations and the key trends in the IT industry that are relevant to the Company. These updates help the Board members in keeping abreast of key changes and their impact on the Company. Further Subject Knowledge Experts from various fields are also invited to the meetings of the Board/Committees to appraise the Board Members of the latest developments in the IT and the business.

TRAINING

The Company has laid down a policy on the training of Independent Directors as part of its governance policies. The Senior Leadership of the Company periodically updates the Directors on regulatory changes, business strategy and operations.

BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and Regulation 19 read with Schedule II, Part D of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has devised a policy on evaluating the performance of the Board of Directors, the Chairman, Committees, and Individual Directors. The evaluation process was carried out through a web-based portal. The summary of the evaluation reports

was presented to the respective Committees and the Board. The Directors had given positive feedback on the overall functioning of the Committees and the Board. The suggestions made by the Directors in the evaluation process have been suitably incorporated in the processes.

NUMBER OF MEETINGS OF THE BOARD

The Board met five times during the Financial Year 2022-23. The meeting details are provided in the Corporate Governance report that forms part of this Annual Report. The maximum interval between any two meetings did not exceed 120 days as prescribed in the Companies Act, 2013 and SEBI Listing Regulations.

COMMITTEES OF THE BOARD

As on March 31, 2023, the Board has constituted seven Committees, namely, Audit Committee, Nomination and Remuneration Committee, Stakeholders Relationship Committee, Risk Management Committee, Corporate Social Responsibility Committee, Investment Committee and Securities Allotment Committee. The details of terms of reference of each Committee and the meetings held during the year are given in the Corporate Governance Report.

The Company has also formed Group Governance Council comprising of Board Members and Senior Management in terms of the SEBI Circular No. SEBI/ HO/CFD/CMD/CIR /P/2018/79 dated May 10, 2018, considering it has a large number of subsidiaries.

POLICY ON DIRECTORS’ APPOINTMENT AND REMUNERATION

The Governance policies laid down by the Board of Directors of your Company include:

i. Policy on the appointment and removal of Directors, Key Managerial Personnel and Senior Management.

ii. Policy on remuneration to the Directors, Key Managerial Personnel and Senior Management and other Employees.

The extract of these two policies is provided in "Annexure III”.

The policies are available on the website of the Company and can be accessed at https://insights. techmahindra.com/investors/Governance-Policies-including-remuneration-to-Directors-KMPS.pdf

SUCCESSION PLAN

In accordance with the principles of transparency and consistency, your Company has adopted governance policies for appointments, remuneration and evaluation of its Board of Directors, Key Managerial Personnel & Senior Management. In line with these Governance policies, the Company has established a formal Succession Planning Program for Key Managerial Personnel across the organization. The Board evaluates all such plans at a regular interval and institutes a formal program for filling any such critical position. The Board evaluates both internal and external candidates for such positions along with the recommendations of the management. The Company also has a leadership development program where it identifies high potential managers, and trains them to take up the positions of higher responsibility. The Company has identified the second line of leadership, which provides stability to the business in case of contingencies.

KEY MANAGERIAL PERSONNEL (KMP)

Pursuant to provisions of Section 203 of the Companies Act, 2013, Mr. C. P. Gurnani, Managing Director & Chief Executive Officer, Mr. Milind Kulkarni, Chief Financial Officer (up to May 31, 2022), Mr. Rohit Anand, Chief Financial Officer (w.e.f. June 1, 2022) and Mr. Anil Khatri, Company Secretary & Compliance Officer were the Key Managerial Personnel of the Company during the year under review.

DIRECTORS’ RESPONSIBILITY STATEMENT

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

i. in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

ii. they have, in the selection of the accounting policies, consulted the Statutory Auditors and these have been applied consistently and, reasonable and prudent judgments and estimates have been made so as to give a true and fair view of the state of affairs of the Company as at March 31, 2023 and of the profit of the Company for the year ended on that date;

iii. proper and sufficient care had been taken 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 other irregularities;

iv. the annual accounts have been prepared on a going concern basis;

v. they had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively;

vi. the proper systems to ensure compliance with the provisions of all applicable laws are in place and are adequate and operating effectively.

DETAILS WITH RESPECT TO ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS

The Company has internal financial controls which are adequate and were operating effectively. The controls are adequate for ensuring the orderly and efficient conduct of the business, including adherence to the Company’s policies, the safeguarding of assets, the prevention and detection of frauds and errors, the accuracy and completeness of accounting records and timely preparation of reliable financial information.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS / PROCEEDINGS

There are no significant and material orders passed by the regulators or courts or tribunal, impacting the going concern status and the Company’s operations in the future.

Further no application against the Company has been filed or is pending under the Insolvency and Bankruptcy Code, 2016, nor has the Company done any one-time settlement with any Bank or Financial institutions.

STATUTORY AUDITORS

The members, in the 35th Annual General Meeting (AGM) held on July 26, 2022, appointed M/s. B S R & Co. LLP, Chartered Accountants, [ICAI Firm’s Registration No. 101248W/W- 100022] as the Statutory Auditors of the Company, to hold office for a further term of five consecutive years from the conclusion of the 35th AGM of the Company held in

the Financial Year 2021-22 until the conclusion of the AGM of the Company for the Financial Year 2026-27 on such remuneration as may be determined by the Board of Directors.

There are no qualifications, reservations, adverse remarks or disclaimers made in the audit report for the Financial Year 2022-23.

SECRETARIAL AUDIT REPORT

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 had appointed Makarand Lele & Co., Practicing Company

Secretary, Pune to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is available at "Annexure IV” to this report. There are no qualifications, reservations, adverse remarks or disclaimers made in the Secretarial Audit Report.

COMPLIANCE WITH SECRETARIAL

STANDARDS

The Company has complied with the applicable Secretarial Standards.

ANNUAL RETURN

Pursuant to the provisions of Section 92(3) read with Section 134(3) (a) of the Companies Act, 2013, the Annual Return in Form MGT-7 is available on the website of the Company and can be accessed at https://insights.techmahindra.com/investors/mgt-7.pdf

INVESTOR EDUCATION AND PROTECTION FUND (IEPF)

During the year, the Company has transferred the unclaimed dividends of '' 2,13,40,674 to the Investor Education and Protection Fund. Further, 2,26,700 corresponding shares on which dividends were unclaimed for seven consecutive years were transferred to the fund as per the requirements of the IEPF Rules. The Members are requested to check the details of the unpaid dividend on the website of the Company and claim their dividend to avoid the shares from being transferred to IEPF.

MANAGERIAL REMUNERATION

Disclosures of the ratio of the remuneration of each director to the median employee’s remuneration and other details as required pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of

Managerial Personnel) Rules, 2014 as amended from time to time, are provided as "Annexure V”. None of the Directors or the Managing Director & CEO of the Company received any remuneration or commission from Subsidiary Companies of your Company.

The details of remuneration paid to the Directors including the Managing Director & CEO of the Company are provided in the Corporate Governance Report.

PARTICULARS OF EMPLOYEES

The information required under Section 197(12) of the Companies Act, 2013 ("the Act”) read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms part of this Report. However, pursuant to first proviso to Section 136(1) of the Act, this report is being sent to the Shareholders excluding the aforesaid information. Any shareholder interested in obtaining said information may write to the Company Secretary at the Registered Office / Corporate Office of the Company and the said information is open for inspection at the Registered Office of the Company.

POLICY ON PREVENTION OF SEXUAL HARASSMENT

Your Company has laid down the Prevention of Sexual Harassment (POSH) policy which is available on its website. The Company has zero tolerance on Sexual Harassment at workplace. During the year under review, there were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

The status of complaints received under POSH and redressed by the POSH Committee of the Company, during the Financial Year under review, are given below:

a) Number of complaints received during the year - 74

b) Number of complaints redressed during the year - 73@

c) Number of complaints pending for redressal as on March 31, 2023 - 3

@ - Includes 2 complaints received during the previous year and redressed during the year.

There are focused campaigns on the POSH policy within the Company and awareness drives that

take place. Furthermore, employees are required to undertake a mandatory certification on POSH to sensitize themselves and strengthen their awareness.

EMPLOYEE STOCK OPTION SCHEMES

During the year under review, there were no material changes in the Employee Stock Option Schemes (ESOPs) of the Company and the Schemes are in compliance with the SEBI Regulations on ESOPs.

As per Regulation 14 of Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021, the details of the ESOPs are uploaded on the website of the Company and can be accessed at https://insights.techmahindra. com/investors/details-of-esops-fy-2022-23.pdf

CORPORATE GOVERNANCE

A report on Corporate Governance covering among others composition of the Board of Directors, details of meetings of the Board and Committees along with a certificate for compliance with the conditions of Corporate Governance in accordance with the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, issued by the Statutory Auditors of the Company, forms part of this Annual Report.

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.

BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT (BRSR)

SEBI, vide its circular dated May 10, 2021, made BRSR mandatory for the top 1,000 listed companies (by market capitalization) with effect from the FY 2022-23. The Company voluntarily published BRSR for the Financial year 2021-22. The BRSR Report for the year 2022-23 is enclosed as part of this Annual Report.

In addition to the BRSR, the Integrated Annual Report of the Company provides an insight on the various ESG initiatives adopted by the Company. The ESG disclosures have been independently assured by KPMG.

COST RECORDS

Maintenance of cost records and requirement of cost audit as prescribed under the provisions of Section 148(1) of the Companies Act, 2013 are not applicable for the business activities of the Company.

RISK MANAGEMENT

The Risk Management Committee of the Board of Directors devised a Risk Management Policy and guides the operating management to identify risks, analyze their probability and impact and prepare mitigation plans. It periodically reviews the Risk Management Framework & Enterprise Risk Register which is presented by the Chief Risk Officer. The Company identifies all potential risks viz. economic, business, currency, operations, climate, governance, finance, cyber, business continuity etc. and prepares a mitigation plan for each of the risks. The elements of risk as identified by the Company with the impact and mitigation strategy are set out in the Management Discussion and Analysis Report.

ESTABLISHMENT OF VIGIL MECHANISM

The Company has laid down Whistle Blower Policy covering Vigil Mechanism with protective clauses for the Whistle Blowers. The Whistle Blower Policy is made available on the website of the Company.

DEPOSITS / LOANS & ADVANCES, GUARANTEES OR INVESTMENTS

The Company has not accepted any deposits from the public during the year under review. The particulars of loans/advances, guarantees and investments under Section 186 of the Companies Act, 2013 are given in the notes forming part of the Financial Statements.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All transactions entered with Related Parties as defined under Section 2(76) of the Companies Act, 2013 and Regulation 23 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, ("The Listing Regulations”), during the financial year under review were in the ordinary course of business and at an arm’s length pricing basis and do not attract the provisions of Section 188 of the Companies Act, 2013. There were no transactions with related parties in the Financial Year which conflicted with the interest of the Company and required compliance of the provisions of Regulation 23 of the Listing Regulations.

Suitable disclosure as required by the Indian Accounting Standards (Ind AS 24) has been made in the notes forming part of the Financial Statements.

The Company has formulated a policy on the Related Party Transactions and dealing with Related Party Transactions which has been uploaded on the website of the Company and can be accessed at https:// insights.techmahindra.com/investors/Related-Party-Transactions-Policy.pdf

The particulars of related party transactions in prescribed Form AOC - 2 are attached as ‘Annexure VI”. Pursuant to Regulation 23(9) of the Listing Regulations, your Company has filed half yearly report on Related Party Transactions with the stock exchanges.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars as prescribed under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 are provided in "Annexure VII” which forms part of this report.

CORPORATE SOCIAL RESPONSIBILITY

The CSR vision of the Company is "Empowerment through Education.”

In compliance with the guidelines prescribed under Section 135 of the Companies Act, 2013, your Company has constituted a Corporate Social Responsibility (CSR) Committee of the Board. The CSR policy, covering the Objectives, Focus Areas, Governance Structure Monitoring and Reporting Framework among others is approved by the Board of Directors. In accordance with the amendments made in Section 135 in January 2021, the CSR Policy has been duly revised and is available on the website of the Company and can be accessed at https://insights. techmahindra.com/investors/tml-csr-policy-23.pdf

The Company has spent more than 2% of the average net profits of the Company during the three immediately preceding Financial Years on CSR.

The Company’s social initiatives are mainly carried out by Tech Mahindra Foundation and Mahindra Educational Institutions, Section 8 (erstwhile Section 25) Companies promoted by the Company.

TECH MAHINDRA FOUNDATION (TMF) EDUCATION

The key initiatives taken by TMF in the arena of school education include:

ALL ROUND IMPROVEMENT IN SCHOOL EDUCATION (ARISE)

Tech Mahindra Foundation’s educational initiatives under ARISE are long-term school improvement programmes, in partnership with local governments and partner organisations. The Foundation in 2022-23 worked with 18 government primary & secondary schools to transform them into model schools of excellence. A total of 5,224 students were positively impacted under this programme, of which 2,832 were girls.

During the year, the Foundation expanded its work for children with special needs through its ARISE programme. This programme is a variant of ARISE in which children with special needs are provided chronic therapy as well as special education to help them lead more fulfilling lives. Through 32 projects, the programme enabled 4,829 children with special needs to become better learners with greater independence in managing their lives. The Foundation has taken up the provision of assistive technology for these children as an important value addition to its work in ARISE .

SHIKSHAANTAR

Shikshaantar, envisioned as a programme for enhancing the capacity of government school teachers, has emerged as an important programme in the education portfolio of the Foundation. TMF works with the Municipal Corporation of Delhi by running their In-Service Teacher Education Institutes. With the merger of the MCDs, TMF now has the responsibility of training teachers from close to 1,500 primary schools in Delhi. During the year under review, as many as 4,379 teachers were trained as part of Shikshaantar. This included specially designed modules for Digital Literacy, Child Safety, Cyber Security and Mental Health that were delivered to the teachers in a hybrid mode.

MOBILE SCIENCE LAB & ROBOTICS LAB

In order to increase the footprint of its work in Education and reach the unreached, TMF launched a unique initiative in 2019-20 - The Mobile Science Lab (MSL). For this, a Mahindra bus has been remodeled to become a science lab on wheels and has been travelling from school to school in East Delhi to provide STEM learning for children in grades 3 and 4 in these

schools. The MSL program benefitted as many as 6,861 students and 77 teachers throughout the year.

Following the success of the MSL program, TMF has also set up a Robotics Lab at one of its ARISE schools in Delhi which is an all-girls school. This lab was inaugurated in November 2022, and nearly 300 girls from this school are the potential beneficiaries.

EMPLOYABILITY

Skills-for-Market Training (SMART) is the Foundation’s flagship programme in employability. It is built on the vision of an educated, enabled and empowered India, and the belief that educated and skilled youth are the country’s true strength. The programme started with 3 Centres in 2012 and is currently running over 85 Centres at 10 locations across India. These include SMART Centres, SMART Centres (training for people with disabilities), and SMART-T Centres (training in technical trades).

In 2022-23, your Company trained 17,641 young women and men under its SMART program, of which, 1,303 were persons with disabilities. More than 70% of the graduates are placed in jobs across multiple industries upon successful completion of the training. The average salaries being earned by the graduates of the SMART program have been steadily rising and saw a 10% jump over the previous year.

The Foundation’s commitment to setting new benchmarks in skill development in India has been underscored by the setting up of Tech Mahindra SMART Academies, which provide the highest quality of skill training to youngsters in Healthcare and Digital Technologies. During FY 2022-23, 3,584 students were trained at the nine Academies that are now functional - 5 in Healthcare, 3 in Digital Technologies, and 1 in Logistics.

TMF’S OUTREACH INITIATIVES

In addition to all the core programs described above, Tech Mahindra Foundation is now also implementing several outreach projects in collaboration with various agencies. As part of these, the TMF team members are engaged in activities such as community health initiatives, teacher training, provision of content for other large-scale projects, etc. As part of such outreach projects, TMF supported 20,734 beneficiaries, taking the total tally of direct beneficiaries for the year to 61,995. This is nearly 50% more than the number of direct beneficiaries for FY 2021-22, which stood at 41,374.

MAHINDRA EDUCATIONAL INSTITUTIONS (MEI)

MEI - a not-for-profit, 100% subsidiary of the Company has set up Mahindra Ecole Centrale in August 2014 - through a collaborative venture between Mahindra Educational Institutions and Ecole Centrale of Paris, France (now known as Centrale Supelec) and the JNTU Hyderabad - to offer undergraduate engineering programs. Through this strong Indo-French Collaboration with Centrale Supelec and Industry connect with Tech Mahindra, MEC has emerged as a disruptive player in the field of Technical Education.

MEI has sponsored the setting up of Mahindra University to introduce diverse streams of education in addition to Engineering. Further the Engineering stream is being transitioned to Mahindra University.

MAHINDRA UNIVERSITY (MU)

Mahindra University ("MU”) (sponsored by Mahindra Educational Institutions, ("MEI”) - a not-for-profit, 100% subsidiary of Tech Mahindra), was notified on May 20, 2020 by the Government of Telangana vide The Telangana State Private Universities (Establishment and Regulation) Act, 2018 for "educating future citizens for and of a better world”.

The Ecole Centrale School of Engineering (ECSoE) currently runs various UG, PG and Ph.D. programs in cutting-edge engineering departments. ECSoE also launched a Centre for Life Sciences and offers courses in biotechnology and computational biology under it. The school plans to launch the 2.5 year integrated programs in Biotechnology & CSE for AY 2023-24.

Cornell University’s SC Johnson College of Business, an ivy league institution is the "Academic Partner” for School of Management. Mahindra University’s School of Management (MU - SoM) will benefit significantly from Cornell University’s expertise in curriculum development, faculty exchange programs including some specialty courses delivery by the Cornell faculty to Mahindra University students, as well as student immersion at Cornell. The School of Management currently conducts BBA, BA, E-MBA, and MBA (starting in 2023) programs.

The School of Law, Mahindra University, commenced operations in September 2021 in Hyderabad offering 5-year integrated programs in BA LL.B and BBA LL.B. It was founded on the philosophy of securing justice, equality, and service to all sections of society. With the needs of modern society evolving rapidly, there is a renewed focus on the importance of the discipline of

law. The School of Law will aim to make a difference to the legal profession and practice by providing a diverse, flexible curriculum and pedagogy, touching on several aspects of domestic and international law, while appraising the students of the latest trends in academia and practice. Starting 2022, the School of Law has launched a 3-year LLB (Hons) program and intend to launch a 6-year integrated B.Tech LLB course starting Academic Year 2023.

The University also plans to launch the following programs/schools for the Academic Year 2023-24:

1. School of Media

a. 4-year B.Tech. (Computation & Media)

b. 3-year BA (Digital Media & Communication)

2. School of Hotel Management

a. 3-year B.Sc. (Hospitality & Hotel Administration)

In the academic year 2022, a total of 2,971 students were studying under various programs across all schools and departments. The new admissions for academic year 2022 are 1,236 students of which 1,128 students are in various UG programs, including School of Management and School of Law, 22 students in the PG programs of School of Engineering and 86 students in the Ph.D programs across all the schools.

The Annual Report on CSR activities is provided as "Annexure VIII”.

SUSTAINABILITY

Your Company aligns closely with the Mahindra Group’s ambition to Rise: Be People positive, Planet positive, and Trust positive. The Company holistically embraces ever greater responsibility towards protecting the environment, empowering the society, and providing good governance.

Your Company’s strategy for creating long-term sustainable value is by improving, scaling, and transparently communicating our ecological, social, and economic impacts. Our strong governance framework led by the Board of Directors of your Company, who have oversight of the Company’s overall strategy and future direction and ensures the planning and implementation of environmental and social programs.

The Company’s holistic approach enables to drive sustainable impact in alignment with leading global frameworks, initiatives, and agendas committed to furthering sustainability such as the TCFD, SASB, GRI, as well as the Paris Agreement, the UNGC and the UN SDGs.

As a business, the Company recognizes the value of following the UN SDGs (Sustainable Development Goals) of People, Planet, Prosperity, and Partnership and continues to create value through initiatives that cater directly to these aspects of our performance.

People:

• Great place to work: Working to enhance our organizational culture by enabling our associates with access to advanced technologies, providing Learning & Development opportunities to help develop their skills and areas of expertise and providing them with robust career development programmes.

• Work-life balance: Providing feasible and flexible work-life balance and integration along with a range of associate-friendly policies and processes to reduce attrition.

• Diversity and inclusion: Ensuring that our organization continues to transcend into the realms of gender diversity and includes people with disabilities as well as people from the LGBTQIA community as part of being a socially responsible business.

• Employee engagement & recognition:

Ensuring our associates are engaged, feel valued, and recognized through a robust performance management system, a flexible system of working, and an extensive system of benefits and perquisites.

• Individual Social Responsibility: Encouraging associates to contribute to the society & environment and make these activities an integral part of their day-to-day activities.

Planet:

• Carbon neutrality and Net zero: Committing to carbon neutrality (2030) and Net zero (2035) by switching to renewable energy through on site installations and open access; improving energy efficiency through installation of LEDs, sensors; boosting green investments by

implementing Carbon Price; optimizing business travel by enabling virtual meetings; encouraging use of public transport and carpooling to reduce employee commute emissions; carbon sequestration through tree plantation; moving towards a low carbon economy by optimizing operations to ensure environmental protection.

• No waste to landfill: Installing Organic Waste Converters and vermicomposting plants at own campuses to convert food waste to manure, cutting down their transportation emissions and reducing waste to landfill.

• No to plastic: Maintaining plastic-free campuses and encouraging all stakeholders to use ecofriendly and biodegradable materials. Spreading awareness and initiating campaigns on preventing single-use plastic.

• Reduce, Reuse, Recycle, Recover: Implementing the process of Reduce, Reuse, Recycle and Recover across the value chain to limit waste and enable a circular economy.

• Being water positive: Improving water efficiency and increasing water savings by using water sensors, restrictors and water-efficient coolers, recycling wastewater through STPs, and recharging groundwater levels with Rainwater Harvesting Pits.

• Promoting Biodiversity: Protecting local flora and fauna across all our locations to ensure that we do not adversely impact biodiversity through our operations.

Prosperity:

• Innovation: Embracing technology and innovation by incorporating IoT, Blockchain, AI and Machine Learning to develop a portfolio of sustainable solutions that help reduce emissions and other negative impacts of climate change.

• Green solutions: Investing in Sustainability reporting solution (i.Sustain) and Climate Risk Management platforms, Smart grid, Microgrid-As-A-Service, Community Action Platform for Energy, Integrated Electric Vehicle Charging systems (IEVCS), Smart data hubs and Smart Cities for our Customers to reduce their carbon emissions.

• Connecting with customers: Embracing brand equity by connecting with our customers to address their current and future needs and ensuring customer satisfaction.

Partnership

• Learning and Sharing: Partnering with collaborators & partner companies to create an alliance ecosystem and supplement each other’s capabilities on joint projects. Collaborating with academia, businesses, NGOs, and governments to address some of the global challenges like health care, climate change, inequality, etc.

• Sustainable supply chain: Ensuring that we are in synch with our value chain in our commitment towards climate action and helping our suppliers follow the highest standards of sustainable and ethical best practices within their own organizations.

Tech Mahindra has drafted its Integrated Annual report in accordance with Global Reporting standards and frameworks with the data assured by a third party thus complying with the highest transparency standards.

The Company’s progress against the sustainability targets and metrics are disclosed in the externally assured Integrated reports available on the website of the company- https://www.techmahindra.com/en-in/ sustainability/

AWARDS AND RECOGNITION

Your Company continued its quest for excellence in its chosen area of business to emerge as a true global brand. Several awards and rankings continue to endorse your Company as a thought leader in the industry. A few of the prominent Awards / recognitions received by the Company during the Financial Year 2022-23 include:

• Tech Mahindra won several medals in the USA for its people practices- Brandon Hall HCM Excellence Awards, Stevie Awards for Great Employers and was also included in the 2023 Bloomberg Gender-Equality Index (GEI).

• Tech Mahindra Philippines was certified as a Great Place to Work.

• The Economic Times bestowed Tech Mahindra with several recognitions including Great Manager Awards (People Business), Human Capital Awards and ‘Best Organizations for Women’ (Femina).

• Tech Mahindra was also recognized by Avtar and Seramount as "Champions” in Most Inclusive Companies Index and "Top 10” in Best Companies for Women in India.

• Dun & Bradstreet India recognized Tech Mahindra as a top performer in the ESG Performance -Software and BPM sector.

• Tech Mahindra won Frost & Sullivan’s Technology Innovation Leadership Award 2022 for Metaverse Technology Services.

• Tech Mahindra was recognized among the Iconic brands at ET Iconic Brands 2022.

• TechM amplifAI0->^ is awarded "Cool Product or Service of the Year in Business 2022.” at the 12th Annual 2022 Business Excellence Awards by Globee® Business Awards.

• Tech Mahindra MEA was recognized for Ground-breaking products/services in Ecommerce at GITEX.

• Tech Mahindra was awarded ‘A’ rating in MSCI ESG ratings 2022.

• Tech Mahindra received the "Mahatma Award 2022 for Social Good & Impact - Decent Work and Economic Growth” for its SMART Program.

These awards are a reflection of the Company’s continued efforts in the fields of business, sustainability, human resource management and its sustained progress towards creating a better society for all.

ACKNOWLEDGEMENTS

Your directors place on records their appreciation for the contributions made by employees towards the success of your Company. Your directors gratefully acknowledge the co-operation and support received from the shareholders, customers, vendors, bankers, Regulatory and Governmental authorities in India and abroad.

For and on behalf of the Board

Anand G. Mahindra Place: Mumbai Chairman

Date: 15th June, 2023 (DIN: 00004695)

Note: The Board of Directors at its meeting held on April 27, 2023, had approved the financial statements for the financial year 2023 and the Director''s Report along with the Annexures. However, in view of the appointment of Mr. Mohit Joshi as Additional Director and Whole Time Director, the revised Director''s Report was approved by the Board at its Meeting held on June 15, 2023.

1

Interim Dividend (Special Dividend) for the Financial Year ended March 31, 2022 and Final Dividend for the Financial Year ended March 31, 2021


Mar 31, 2023

Your directors are pleased to present the Thirty Sixth Annual Report along with the audited accounts of your Company for the year ended March 31, 2023.

FINANCIAL RESULTS (STANDALONE)

('' in Million)

For the year ended March 31

2023

2022#

Income

437,856

372,079

Profit Before Interest, Depreciation and Tax

58,978

72,383

Interest

(1,808)

(689)

Depreciation

(8,129)

(7,403)

Profit Before Tax

49,041

64,291

Provision for Taxation

(11,266)

(14,058)

Profit After Tax

37,775

50,233

Other Comprehensive Income

(2,480)

1,200

Balance brought forward from previous year

216,090

203,329

Profit available for appropriation

253,917

253,292

Equity Dividends

(46,705)1

(43,624)1

Transfer to retained earnings on account of options lapsed

99

74

Transferred from Special Economic Zone re-investment reserve on utilization

7,151

6,348

Balance carried forward

214,462

216,090

# - Figures for the previous year are restated after considering the amalgamation of Tech Mahindra Business Services Limited and Born Commerce Private Limited with the Company.

1 Interim Dividend (Special Dividend) for the Financial Year ended March 31, 2023 and Final Dividend for the Financial Year ended March 31,2022

DIVIDEND

The Board of Directors on November 1, 2022 approved a special interim dividend of '' 18/- per share (i.e. 360%) on the par value of '' 5/- each which was paid by the Company to the shareholders whose names appeared in the Register of Members as on November 10, 2022, being the record date for the payment of dividend. Your Directors are pleased to recommend a final dividend of '' 32/- per share on par value of '' 5/- (i.e. 640%), payable to those Shareholders whose names appear in the Register of Members as on the Book Closure Date. Thus, the total dividend for the FY 2022-23 will be '' 50/- per share (i.e. 1000%) against the dividend of '' 45/- per share (i.e. 900%) paid for the Financial Year 2021-22.

The Board of your Company decided not to transfer any amount to the General Reserve for the year under review.

Your Company has formulated a Dividend Policy which is disclosed on the website of the Company and can be accessed at https://insights.techmahindra.com/ investors/tml-dividend-distribution-policy.pdf

SHARE CAPITAL

During the year under review, your Company allotted 2,313,996 equity shares on the exercise of stock options under various Employee Stock Option Schemes. Consequently, the issued, subscribed and paid-up equity share capital has increased from '' 4,859.17 million divided into 971,833,479 equity shares of '' 5/- each to '' 4,870.74 million divided into 974,147,475 equity shares of '' 5/- each.

ALTERATION OF ‘CAPITAL CLAUSE’ OF MEMORANDUM OF ASSOCIATION

Consequent to the merger of Tech Mahindra Business Services Limited and Born Commerce Private Limited with the Company, the Authorised Capital of the

Company increased from '' 8,336.50 million divided into 1,667,300,000 equity shares of '' 5/- each to '' 9,093 million divided into 1,818,600,000 equity shares of '' 5/- each.

Accordingly, the Capital Clause of the Memorandum of Association of the Company was altered and substituted with the new Clause V to reflect the corresponding changes in the Authorised Share Capital.

BUSINESS PERFORMANCE / FINANCIAL OVERVIEW

Imperative for businesses and your Company to stay relevant is the need to be cognizant of the tectonic shifts occurring around the world. Technological innovations, climate change and the need for inclusive growth and representation among others is defining the way organization’s function. Tech Mahindra has remained on the forefront of all cutting-edge technological advancements and harnessed many emerging technologies to transform customer and employee experiences. Your Company’s execution strategy is indexed to the pillars of client focus, portfolio synergy, operational rigor, new age technology bets and people transformation.

During the Financial Year ended on March 31, 2023, the Company’s revenues grew to '' 532,902 million on a consolidated basis as against '' 446,460 million in the previous year - indicating a robust growth of 19.4%. The growth was broad based across geographies as both Americas and Europe contributed in line with overall business growth. The Company also saw healthy growth across business segments in Communications, Media and Entertainment (CME) and Enterprise verticals.

The EBITDA on a consolidated basis for the Financial Year 2023 was '' 80,288 million, similar to the previous year’s EBITDA of '' 80,200 million. The resultant EBITDA margins were in the range of 15.1% in FY 2023 compared to 18.1% in FY 2022. The post-tax profit of the Company was reduced to '' 48,313 million in FY 2023 as against '' 55,661 million in FY 2022.

The Company saw robust demand for digital transformation services with a focus on customer experience and cloud. The Company has seen new deal wins close to USD 3,000 million during the year, indicating a healthy growth momentum across all business verticals. Your Company’s investments in Enterprise SaaS and Hi-tech capabilities will help

it cater to increasing modernization demands from businesses in the Financial Year 2024 and beyond.

MATERIAL CHANGES AND COMMITMENTS AFFECTING FINANCIAL POSITION BETWEEN THE END OF THE FINANCIAL YEAR AND THE DATE OF THE REPORT

There have been no material changes and commitments which affect the financial position of the Company that have occurred between the end of the financial year to which the financial statements relate and the date of this report.

ACQUISITIONS

Your company made the following acquisition during the FY 2022-23.

THIRDWARE SOLUTIONS LIMITED

The Company acquired 100% of the share capital of Thirdware Solutions Limited ("Thirdware”) on June 3, 2022 at a consideration up to USD 42 million including earnouts. Thirdware is a global player in Enterprise Applications and will enhance the Company’s digital solutions and services in automotive consultant and design, development and implementation in areas like ERP (Enterprise Resource Planning), EPM (Enterprise Performance Management), RPA (Robotic Process Automation) and IloT (Industrial Internet of Things). These capabilities will give the Company an edge in the manufacturing space.

UPDATE ON MERGER

Your directors at their meeting held on January 31, 2021 approved the Scheme of Merger of Tech Mahindra Business Services Limited (TMBSL) and Born Commerce Private Limited (Born) with the Company with the appointed date as April 1, 2021.

Hon’ble NCLT, Mumbai bench and Hon’ble NCLT, Chennai bench vide their order dated January 5, 2023 and January 12, 2023 respectively, approved the scheme of merger by absorption of the TMBSL and Born with the Company and their respective shareholders and the said Scheme has become effective on February 16, 2023.

SUBSIDIARIES, ASSOCIATES AND JOINT VENTURES OF THE COMPANY

The performance and financial position of the subsidiaries, associates, and joint venture companies included in the consolidated financial statement is provided in accordance with the provisions of Section

129 read with Rule 5 of the Companies (Accounts) Rules, 2014 containing the salient features of the financial statement of the Company’s subsidiaries/joint ventures or associate companies in Form AOC - 1 in “Annexure I” to this report.

Pursuant to Rule 8(5)(iv) of the Companies (Accounts) Rules, 2014, the names of the companies which have been incorporated or ceased to be the subsidiaries, joint ventures or associate companies during the year are provided in “Annexure II” to this report. The Company is actively pursuing the initiative on the consolidation of its subsidiaries/branches to optimize the operational costs. During the year under review, your Company has closed/merged twenty subsidiaries.

HUMAN RESOURCES

The employees of the Company are the most critical asset to your Company. The Company has taken several steps to protect, retain, and improve the competencies of these assets including:

Hiring: Forecast to Fulfilment

Your Company has streamlined its talent hiring process adopting some best-in-class practices. By building predictability in talent planning & forecasting for new age skills, your Company has been able to fuel business growth. Your Company has revamped its Buddy Referral programs to recruit talent from existing employee networks while offering attractive incentives. Embracing diversity in the hiring process has improved the global and local representation of talent within the organization. The Company has also redesigned its Candidate Engagement process to focus on creating positive experiences from the issuing joining offer letter to internal deployment to client projects. With rigor in talent allocation and proactive skilling of bench talent, your Company has been able to increase its internal fulfilment to 71% from 48% which is the best in the industry.

Learning: Skilling on the job

With the growth in digital business, your Company has been transforming its workforce both at speed and scale. The Company accelerated skilling initiatives to keep up with the pace of technological developments and built a ‘future-ready’ talent pool. #NAD Learn, the Al-based platform with interactive, on-demand, contextual and hyper-personalised up-skilling is helping the Company develop full-stack professionals. Your Company has supplemented this with young leadership development programs as well

as new policies to promote niche skilling and fast-track career growth. Employees can learn and grow as a Fresher through Elevate, in customer deployments through Project Skilling, for career progression through Future Skilling and into the leadership pipeline through journey-based programs. The Company also offers super-specialization skilling programs including Architect CoE, HiPOT programs at units and Program Manager CoE through EMBARK. Some new programs that the Company has recently launched for high-potential talent development include MALT and TrIBE.

Leadership: Integrative Thinking

The natural culture of empowerment that was supercharged during the pandemic continues to be the mainstay in the current hybrid work environment. Your Company aims to help employees imbibe mindsets & behaviors for the future which include a renewed focus on Integrative Thinking, Business & Financial Acumen, Bias for Action, Closure over Follow-up, Data over Emotions and Extreme Ownership. This was reinforced through the adoption of an industry leading learning platform - Harvard Manage Mentor Spark aimed at imparting best-in-class training at every level in realtime. Your Company has a robust Talent Management process for developing the leadership talent pipeline and has adopted consistent coaching practices for managers. Apart from Coaching, the employees have experienced new forms of learning with technology-enabled tools and pedagogies. For example, the ‘Wheel of Life’ is a customized self-coaching tool with gamified journeys, and personalized Habit Tracking making personal and professional well-being goals accessible to every employee.

Performance: Feedback focused

Your Company launched the Annual Performance Feedback cycle in December 2022. In order to build a culture where performance is enabled through feedback, Managers have been trained to have better performance review dialogues with their direct reports and work on an outcome-based evaluation rather than process or effort measurement. Your Company is creating a High-Performance Culture through hyper-personalized Incentive plans. Your Company has a suite of Incentive plans that are designed to create a strong alignment between Individual growth and Organization performance.

Wellness: Collective well-being

Your Company puts a happier, healthier and more productive workforce at the core of its business, policies and decisions. Your Company has designed

initiatives covering eight dimensions of wellness -Physical, Occupational, Emotional, Spiritual, Social, Environmental, Financial and Intellectual. The focus on preventative care with Corporate paid preventive health check, on-campus doctor consultations & counselling programs, helps employees diagnose any health condition in advance. To tackle IT industry specific issues, the Company organizes wellness sessions on Ergonomics, Healthy eating, Lifestyle management etc. Multiple tech-enabled wellness interventions like Kick the Butt (Smoking Cessation Program), Bend it like TechM (Guide to Ergonomics), Dump the Plump (Weight loss challenge) etc. have helped employees create healthier habits. Through the People Care program, managers are encouraged to show their human side and empower their team members to pursue collective well-being.

Communication: Building purpose

A robust communication process is at the heart of the Company’s vibrant culture. Employees are kept connected and informed through multiple media. Your Company’s 360-degree communication framework ensures employees have access to connect with leaders, peers and the external world. With publications, platforms, storytelling, campaigns, and connects, the organizational culture is shared with all. Your Company shares stories of diverse individuals achieving extraordinary things using structured formats like #RiseFromWithin. Leaders in the Company share not just business updates and success stories but personal anecdotes that reinforce the belief of a shared destiny.

Engagement: Hybrid connects

For an increasingly hybrid workplace, the Company has designed several virtual ‘water-cooler’ moments like All Hand Meets with CXO, Prime Time, Location Connects etc. along with family connects. Employees have platforms like MS Teams and Cisco WebEx for collaborative yet decentralized working. Your Company also organized on-ground engagement linked to TechM’s FIDE partnership for the Chess Olympiad. TechM CARES Action Planning workshops were also organized across different business units to implement changes based on employee feedback. Your Company also organized more than 1,200 engagement programs globally linked to Rise Refresh.

Rise Refresh: #TogetherWeRise

For more than a decade, the Rise philosophy has inspired employees from across the Mahindra Group to come to work and build something meaningful.

Since then, the world has changed with the rise of disruptive technologies, changing start-up ecosystem, climate change and recently, the pandemic. This is why, the Company has defined a new core purpose and brand pillars of Rise to simplify and sharpen its commitments. Your Company has leveraged every possible medium to ensure that this is communicated to all employees. From the conventional posters, communities, blogs, leader-bytes, microsite, quizzes and signatures route to the unconventional music, memes, WhatsApp stickers, GenZ lingo, podcast conversations and comic strips, Rise has touched the heart of every employee.

Diversity: Respecting Individuality

Your Company believes that respecting diversity and ensuring inclusion is fundamentally the right thing to do. It respects, embraces and celebrates the uniqueness of every individual. This also links back to the stated objective of the Company to be human-centered by encouraging associates to bring their most authentic selves to work. Your Company initiated the Maternity Assistance Program (MAP) to support employees who were on Maternity Leave in their transition back to work. The Company has also organized several Fireside chats featuring women with STEAM (Science, Technology, Engineering, Arts, Mathematics) roles to inspire others to grow in these fields. Through the ‘Restart’ Program, the Company aims to help Women IT Professionals restart their career after a break.

Recognition: Appreciation always

Your Company believes in appreciating, recognizing, and celebrating by building a culture where good work and behavior are appreciated. The Company has designed specialized recognition programs where rewards, tenure, performance, and contribution are celebrated, often with the loved ones of employees. The recognition program is centered around n = 1, that is, the individual at the heart of everything. A key part of personalizing recognition is to bring it to the desk of every employee. This is enabled by the KUDOS portal that offers recognition badges as well as redemption options for the points earned. Giving employees the ability to appreciate colleagues and sustained campaigns have led your Company to have an industry leading rewards penetration of ~74% including monetary and non-monetary recognition. Tenure is rewarded with personalized gifts for both the employee and their family members. Lastly, there are several organizational level awards for outstanding achievements like the ACE, STAR, Location Council and Spotlight awards.

HR Digitization: Experiencing technology

Your Company has revolutionized employee experience by deploying technology at different touchpoints of their lifecycle. Your Company continued its internal automation focus by using Robotic Process Automation for completing common workforce actions to reduce manual work. Your Company has also integrated HR Chatbot UVO and Technical Support Chatbot ATOM into MS Teams making it easier to perform workforce actions like leave applications, pending approvals, ticket registrations etc. Developing an "Attrition Prediction Model” has provided Your Company with an early warning system predicting the employees’ likelihood to quit, giving the Business HR team the ability to stage an intervention. The Company has also explored the use of Metaverse where three dimensional avatars interact in a virtual world to develop modules for hiring and on-boarding. Translating these experiences to mobile devices, the Company has developed ‘The Wheel of Life’ application as a self-coaching tool.

QUALITY

The Company continues its focus on quality and strives to exceed customer expectations at all times. During the year, it continued to strengthen the implementation of Quality systems and upgraded the processes/systems to comply with CMMI V 2.0 for both Development and Services and currently assessed for maturity level 5. Similarly it underwent various upgrade and re-certification audits for multiple standards during the year in order to meet client demands and enhance value delivery - successfully re-certified, ISO 9001:2015 (Quality Management System), ISO 20000-1:2018 (Information Technology Service Management System), ISO 27001:2013 (Information Security Management System), ISO 27701:2019 (Privacy Information Management System), TL9000 R 6.2/ R5.7 (Quality Management Systems for Tele Communications industry), ISO 13485:2016 (Quality Management Systems for medical devices - scope of certification limited to medical devices business within Tech Mahindra), AS9100 Rev D (Standard for Aerospace domain - scope of certification limited to the aerospace business within Tech Mahindra), ISO 17025:2017 - Laboratory Quality Management Systems for our device testing labs.

In addition to these, your Company also maintains its commitment to health, safety and environment by continually improving its processes in accordance with ISO 14001:2015 (Environmental Management System) and ISO 45001: 2018 (Occupational Health and Safety

Assessment Series) standards. Your Company is also certified on ISO 22301:2012 (Societal Security and Business Continuity Management System) and has a comprehensive Business Continuity and Disaster Recovery framework, to prevent potential business disruptions in the event of any disaster. It has processes that helped resume services to customer’s acceptable service levels. Automated Service Desk with SLAs for enabling business and Vulnerability Assessment and Penetration Testing Lab for secured corporate network operations are highlights that showcase the information security posture of the Organization.

Tech Mahindra (IT Division) has been assessed for the implementation of high maturity business excellence practices at Mahindra Group (Services Sector). It has been assessed at TMW Maturity Stage 7 (on scale of 1-10 stages) of Mahindra Business Excellence Framework - The Mahindra Way. These certifications are testimony of the robustness of business processes and at large, the quality culture imbibed in the organization.

Your Company has institutionalized the Deliverability Risk Assessment (DRA) practice - to assess the readiness and to identify risks at the beginning of the program, continued to strengthen the process for transforming Quality Assurance processes & delivery methods to adopt and strengthen Delivery excellence, Risk governance, and further enhance automation to enable quality delivery to the customer. Quality index which is a measure of quality of products and services delivery is institutionalized.

The Company is ensuring all these initiatives are in place, to ensure that it delivers as stated in its Quality Policy.

DIRECTORS

During the year under review, all Independent Directors have given declarations that they meet the criteria of Independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Independent Directors have also given declaration of compliance with Rules 6(1) and 6(2) of the Companies (Appointment and Qualification of Directors) Rules, 2014, with respect to their name appearing in the data bank of Independent Directors maintained by the Indian Institute of Corporate Affairs.

Pursuant to the provisions of Section 152(6)(c) of the Companies Act, 2013, Mr. Manoj Bhat, Director (DIN: 05205447) is liable to retire by rotation and being eligible offers himself for reappointment.

During the year under review, Ms. Penelope Fowler (DIN: 09591815) was appointed as Additional Director by the Board of Directors of the Company on May 13, 2022. She was further appointed as an Independent Director pursuant to the special resolution passed by the shareholders at the Annual General Meeting held on July 26, 2022 for a period of 5 years.

In view of the retirement of Mr. C. P Gurnani, Managing Director and CEO, the Board of Directors at its meeting held on June 15, 2023, based on the recommendation of the Nomination and Remuneration Committee approved the Appointment of Mr. Mohit Joshi, (DIN: 08339247) as Additional Director with effect from June 20, 2023 to hold office up to the date of ensuing Annual General Meeting. Further in order to ensure smooth transition into the role of Managing Director as Mr. C. P. Gurnani would retire on December 19, 2023, Mr. Mohit Joshi was also appointed as a Whole Time Director designated as Managing Director (Designate) and Key Managerial Personnel with effect from June 20, 2023 up to December 19, 2023 subject to the approval of the members of the Company and the Central Government.

The Board of Directors, based on the recommendation of Nomination and Remuneration Committee also approved the appointment of Mr. Mohit Joshi as Managing Director & Chief Executive Officer of the Company and Key Managerial Personnel under the Companies Act, 2013 from December 20, 2023 to June 19, 2028 (both days inclusive), subject to approval of the members of the Company and the Central Government.

The Board recommends the appointment of Mr. Manoj Bhat and Mr. Mohit Joshi to the Members at the ensuing Annual General Meeting. The brief profile of Mr. Manoj Bhat and Mr. Mohit Joshi is given in the Notice of the Annual General Meeting.

In terms of Regulation 24(1) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations 2015, Mr. T. N. Manoharan, Lead Independent Director of the Company has been appointed as Director on the Board of Tech Mahindra (Americas) Inc., a wholly

owned unlisted material subsidiary of the Company with effect from May 21, 2019.

In the opinion of the Board of Directors, the Independent Directors have relevant proficiency, expertise and experience.

FAMILIARISATION PROGRAMME

These programmes aim to provide insights into the Company to enable the Independent Directors to understand its business in depth and contribute significantly to the Company. The details of the program for familiarisation of the Independent Directors with the Company are available on its website and can be accessed at https://insights.techmahindra.com/ investors/tml-familarisation-progarmmes-for-IDs.pdf

The Board of Directors are regularly updated on changes in statutory provisions like amendments in Corporate Laws, SEBI Regulations, Taxation Laws and People related laws as applicable at the quarterly Board meetings. The Board members are also updated on the Risk universe applicable to the Company’s business. The MD & CEO of the Company had quarterly sessions with Board members sharing updates about the Company’s business strategy, operations and the key trends in the IT industry that are relevant to the Company. These updates help the Board members in keeping abreast of key changes and their impact on the Company. Further Subject Knowledge Experts from various fields are also invited to the meetings of the Board/Committees to appraise the Board Members of the latest developments in the IT and the business.

TRAINING

The Company has laid down a policy on the training of Independent Directors as part of its governance policies. The Senior Leadership of the Company periodically updates the Directors on regulatory changes, business strategy and operations.

BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and Regulation 19 read with Schedule II, Part D of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has devised a policy on evaluating the performance of the Board of Directors, the Chairman, Committees, and Individual Directors. The evaluation process was carried out through a web-based portal. The summary of the evaluation reports

was presented to the respective Committees and the Board. The Directors had given positive feedback on the overall functioning of the Committees and the Board. The suggestions made by the Directors in the evaluation process have been suitably incorporated in the processes.

NUMBER OF MEETINGS OF THE BOARD

The Board met five times during the Financial Year 2022-23. The meeting details are provided in the Corporate Governance report that forms part of this Annual Report. The maximum interval between any two meetings did not exceed 120 days as prescribed in the Companies Act, 2013 and SEBI Listing Regulations.

COMMITTEES OF THE BOARD

As on March 31, 2023, the Board has constituted seven Committees, namely, Audit Committee, Nomination and Remuneration Committee, Stakeholders Relationship Committee, Risk Management Committee, Corporate Social Responsibility Committee, Investment Committee and Securities Allotment Committee. The details of terms of reference of each Committee and the meetings held during the year are given in the Corporate Governance Report.

The Company has also formed Group Governance Council comprising of Board Members and Senior Management in terms of the SEBI Circular No. SEBI/ HO/CFD/CMD/CIR /P/2018/79 dated May 10, 2018, considering it has a large number of subsidiaries.

POLICY ON DIRECTORS’ APPOINTMENT AND REMUNERATION

The Governance policies laid down by the Board of Directors of your Company include:

i. Policy on the appointment and removal of Directors, Key Managerial Personnel and Senior Management.

ii. Policy on remuneration to the Directors, Key Managerial Personnel and Senior Management and other Employees.

The extract of these two policies is provided in "Annexure III”.

The policies are available on the website of the Company and can be accessed at https://insights. techmahindra.com/investors/Governance-Policies-including-remuneration-to-Directors-KMPS.pdf

SUCCESSION PLAN

In accordance with the principles of transparency and consistency, your Company has adopted governance policies for appointments, remuneration and evaluation of its Board of Directors, Key Managerial Personnel & Senior Management. In line with these Governance policies, the Company has established a formal Succession Planning Program for Key Managerial Personnel across the organization. The Board evaluates all such plans at a regular interval and institutes a formal program for filling any such critical position. The Board evaluates both internal and external candidates for such positions along with the recommendations of the management. The Company also has a leadership development program where it identifies high potential managers, and trains them to take up the positions of higher responsibility. The Company has identified the second line of leadership, which provides stability to the business in case of contingencies.

KEY MANAGERIAL PERSONNEL (KMP)

Pursuant to provisions of Section 203 of the Companies Act, 2013, Mr. C. P. Gurnani, Managing Director & Chief Executive Officer, Mr. Milind Kulkarni, Chief Financial Officer (up to May 31, 2022), Mr. Rohit Anand, Chief Financial Officer (w.e.f. June 1, 2022) and Mr. Anil Khatri, Company Secretary & Compliance Officer were the Key Managerial Personnel of the Company during the year under review.

DIRECTORS’ RESPONSIBILITY STATEMENT

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

i. in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

ii. they have, in the selection of the accounting policies, consulted the Statutory Auditors and these have been applied consistently and, reasonable and prudent judgments and estimates have been made so as to give a true and fair view of the state of affairs of the Company as at March 31, 2023 and of the profit of the Company for the year ended on that date;

iii. proper and sufficient care had been taken 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 other irregularities;

iv. the annual accounts have been prepared on a going concern basis;

v. they had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively;

vi. the proper systems to ensure compliance with the provisions of all applicable laws are in place and are adequate and operating effectively.

DETAILS WITH RESPECT TO ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS

The Company has internal financial controls which are adequate and were operating effectively. The controls are adequate for ensuring the orderly and efficient conduct of the business, including adherence to the Company’s policies, the safeguarding of assets, the prevention and detection of frauds and errors, the accuracy and completeness of accounting records and timely preparation of reliable financial information.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS / PROCEEDINGS

There are no significant and material orders passed by the regulators or courts or tribunal, impacting the going concern status and the Company’s operations in the future.

Further no application against the Company has been filed or is pending under the Insolvency and Bankruptcy Code, 2016, nor has the Company done any one-time settlement with any Bank or Financial institutions.

STATUTORY AUDITORS

The members, in the 35th Annual General Meeting (AGM) held on July 26, 2022, appointed M/s. B S R & Co. LLP, Chartered Accountants, [ICAI Firm’s Registration No. 101248W/W- 100022] as the Statutory Auditors of the Company, to hold office for a further term of five consecutive years from the conclusion of the 35th AGM of the Company held in

the Financial Year 2021-22 until the conclusion of the AGM of the Company for the Financial Year 2026-27 on such remuneration as may be determined by the Board of Directors.

There are no qualifications, reservations, adverse remarks or disclaimers made in the audit report for the Financial Year 2022-23.

SECRETARIAL AUDIT REPORT

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 had appointed Makarand Lele & Co., Practicing Company

Secretary, Pune to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is available at "Annexure IV” to this report. There are no qualifications, reservations, adverse remarks or disclaimers made in the Secretarial Audit Report.

COMPLIANCE WITH SECRETARIAL

STANDARDS

The Company has complied with the applicable Secretarial Standards.

ANNUAL RETURN

Pursuant to the provisions of Section 92(3) read with Section 134(3) (a) of the Companies Act, 2013, the Annual Return in Form MGT-7 is available on the website of the Company and can be accessed at https://insights.techmahindra.com/investors/mgt-7.pdf

INVESTOR EDUCATION AND PROTECTION FUND (IEPF)

During the year, the Company has transferred the unclaimed dividends of '' 2,13,40,674 to the Investor Education and Protection Fund. Further, 2,26,700 corresponding shares on which dividends were unclaimed for seven consecutive years were transferred to the fund as per the requirements of the IEPF Rules. The Members are requested to check the details of the unpaid dividend on the website of the Company and claim their dividend to avoid the shares from being transferred to IEPF.

MANAGERIAL REMUNERATION

Disclosures of the ratio of the remuneration of each director to the median employee’s remuneration and other details as required pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of

Managerial Personnel) Rules, 2014 as amended from time to time, are provided as "Annexure V”. None of the Directors or the Managing Director & CEO of the Company received any remuneration or commission from Subsidiary Companies of your Company.

The details of remuneration paid to the Directors including the Managing Director & CEO of the Company are provided in the Corporate Governance Report.

PARTICULARS OF EMPLOYEES

The information required under Section 197(12) of the Companies Act, 2013 ("the Act”) read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms part of this Report. However, pursuant to first proviso to Section 136(1) of the Act, this report is being sent to the Shareholders excluding the aforesaid information. Any shareholder interested in obtaining said information may write to the Company Secretary at the Registered Office / Corporate Office of the Company and the said information is open for inspection at the Registered Office of the Company.

POLICY ON PREVENTION OF SEXUAL HARASSMENT

Your Company has laid down the Prevention of Sexual Harassment (POSH) policy which is available on its website. The Company has zero tolerance on Sexual Harassment at workplace. During the year under review, there were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

The status of complaints received under POSH and redressed by the POSH Committee of the Company, during the Financial Year under review, are given below:

a) Number of complaints received during the year - 74

b) Number of complaints redressed during the year - 73@

c) Number of complaints pending for redressal as on March 31, 2023 - 3

@ - Includes 2 complaints received during the previous year and redressed during the year.

There are focused campaigns on the POSH policy within the Company and awareness drives that

take place. Furthermore, employees are required to undertake a mandatory certification on POSH to sensitize themselves and strengthen their awareness.

EMPLOYEE STOCK OPTION SCHEMES

During the year under review, there were no material changes in the Employee Stock Option Schemes (ESOPs) of the Company and the Schemes are in compliance with the SEBI Regulations on ESOPs.

As per Regulation 14 of Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021, the details of the ESOPs are uploaded on the website of the Company and can be accessed at https://insights.techmahindra. com/investors/details-of-esops-fy-2022-23.pdf

CORPORATE GOVERNANCE

A report on Corporate Governance covering among others composition of the Board of Directors, details of meetings of the Board and Committees along with a certificate for compliance with the conditions of Corporate Governance in accordance with the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, issued by the Statutory Auditors of the Company, forms part of this Annual Report.

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.

BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT (BRSR)

SEBI, vide its circular dated May 10, 2021, made BRSR mandatory for the top 1,000 listed companies (by market capitalization) with effect from the FY 2022-23. The Company voluntarily published BRSR for the Financial year 2021-22. The BRSR Report for the year 2022-23 is enclosed as part of this Annual Report.

In addition to the BRSR, the Integrated Annual Report of the Company provides an insight on the various ESG initiatives adopted by the Company. The ESG disclosures have been independently assured by KPMG.

COST RECORDS

Maintenance of cost records and requirement of cost audit as prescribed under the provisions of Section 148(1) of the Companies Act, 2013 are not applicable for the business activities of the Company.

RISK MANAGEMENT

The Risk Management Committee of the Board of Directors devised a Risk Management Policy and guides the operating management to identify risks, analyze their probability and impact and prepare mitigation plans. It periodically reviews the Risk Management Framework & Enterprise Risk Register which is presented by the Chief Risk Officer. The Company identifies all potential risks viz. economic, business, currency, operations, climate, governance, finance, cyber, business continuity etc. and prepares a mitigation plan for each of the risks. The elements of risk as identified by the Company with the impact and mitigation strategy are set out in the Management Discussion and Analysis Report.

ESTABLISHMENT OF VIGIL MECHANISM

The Company has laid down Whistle Blower Policy covering Vigil Mechanism with protective clauses for the Whistle Blowers. The Whistle Blower Policy is made available on the website of the Company.

DEPOSITS / LOANS & ADVANCES, GUARANTEES OR INVESTMENTS

The Company has not accepted any deposits from the public during the year under review. The particulars of loans/advances, guarantees and investments under Section 186 of the Companies Act, 2013 are given in the notes forming part of the Financial Statements.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All transactions entered with Related Parties as defined under Section 2(76) of the Companies Act, 2013 and Regulation 23 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, ("The Listing Regulations”), during the financial year under review were in the ordinary course of business and at an arm’s length pricing basis and do not attract the provisions of Section 188 of the Companies Act, 2013. There were no transactions with related parties in the Financial Year which conflicted with the interest of the Company and required compliance of the provisions of Regulation 23 of the Listing Regulations.

Suitable disclosure as required by the Indian Accounting Standards (Ind AS 24) has been made in the notes forming part of the Financial Statements.

The Company has formulated a policy on the Related Party Transactions and dealing with Related Party Transactions which has been uploaded on the website of the Company and can be accessed at https:// insights.techmahindra.com/investors/Related-Party-Transactions-Policy.pdf

The particulars of related party transactions in prescribed Form AOC - 2 are attached as ‘Annexure VI”. Pursuant to Regulation 23(9) of the Listing Regulations, your Company has filed half yearly report on Related Party Transactions with the stock exchanges.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars as prescribed under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 are provided in "Annexure VII” which forms part of this report.

CORPORATE SOCIAL RESPONSIBILITY

The CSR vision of the Company is "Empowerment through Education.”

In compliance with the guidelines prescribed under Section 135 of the Companies Act, 2013, your Company has constituted a Corporate Social Responsibility (CSR) Committee of the Board. The CSR policy, covering the Objectives, Focus Areas, Governance Structure Monitoring and Reporting Framework among others is approved by the Board of Directors. In accordance with the amendments made in Section 135 in January 2021, the CSR Policy has been duly revised and is available on the website of the Company and can be accessed at https://insights. techmahindra.com/investors/tml-csr-policy-23.pdf

The Company has spent more than 2% of the average net profits of the Company during the three immediately preceding Financial Years on CSR.

The Company’s social initiatives are mainly carried out by Tech Mahindra Foundation and Mahindra Educational Institutions, Section 8 (erstwhile Section 25) Companies promoted by the Company.

TECH MAHINDRA FOUNDATION (TMF) EDUCATION

The key initiatives taken by TMF in the arena of school education include:

ALL ROUND IMPROVEMENT IN SCHOOL EDUCATION (ARISE)

Tech Mahindra Foundation’s educational initiatives under ARISE are long-term school improvement programmes, in partnership with local governments and partner organisations. The Foundation in 2022-23 worked with 18 government primary & secondary schools to transform them into model schools of excellence. A total of 5,224 students were positively impacted under this programme, of which 2,832 were girls.

During the year, the Foundation expanded its work for children with special needs through its ARISE programme. This programme is a variant of ARISE in which children with special needs are provided chronic therapy as well as special education to help them lead more fulfilling lives. Through 32 projects, the programme enabled 4,829 children with special needs to become better learners with greater independence in managing their lives. The Foundation has taken up the provision of assistive technology for these children as an important value addition to its work in ARISE .

SHIKSHAANTAR

Shikshaantar, envisioned as a programme for enhancing the capacity of government school teachers, has emerged as an important programme in the education portfolio of the Foundation. TMF works with the Municipal Corporation of Delhi by running their In-Service Teacher Education Institutes. With the merger of the MCDs, TMF now has the responsibility of training teachers from close to 1,500 primary schools in Delhi. During the year under review, as many as 4,379 teachers were trained as part of Shikshaantar. This included specially designed modules for Digital Literacy, Child Safety, Cyber Security and Mental Health that were delivered to the teachers in a hybrid mode.

MOBILE SCIENCE LAB & ROBOTICS LAB

In order to increase the footprint of its work in Education and reach the unreached, TMF launched a unique initiative in 2019-20 - The Mobile Science Lab (MSL). For this, a Mahindra bus has been remodeled to become a science lab on wheels and has been travelling from school to school in East Delhi to provide STEM learning for children in grades 3 and 4 in these

schools. The MSL program benefitted as many as 6,861 students and 77 teachers throughout the year.

Following the success of the MSL program, TMF has also set up a Robotics Lab at one of its ARISE schools in Delhi which is an all-girls school. This lab was inaugurated in November 2022, and nearly 300 girls from this school are the potential beneficiaries.

EMPLOYABILITY

Skills-for-Market Training (SMART) is the Foundation’s flagship programme in employability. It is built on the vision of an educated, enabled and empowered India, and the belief that educated and skilled youth are the country’s true strength. The programme started with 3 Centres in 2012 and is currently running over 85 Centres at 10 locations across India. These include SMART Centres, SMART Centres (training for people with disabilities), and SMART-T Centres (training in technical trades).

In 2022-23, your Company trained 17,641 young women and men under its SMART program, of which, 1,303 were persons with disabilities. More than 70% of the graduates are placed in jobs across multiple industries upon successful completion of the training. The average salaries being earned by the graduates of the SMART program have been steadily rising and saw a 10% jump over the previous year.

The Foundation’s commitment to setting new benchmarks in skill development in India has been underscored by the setting up of Tech Mahindra SMART Academies, which provide the highest quality of skill training to youngsters in Healthcare and Digital Technologies. During FY 2022-23, 3,584 students were trained at the nine Academies that are now functional - 5 in Healthcare, 3 in Digital Technologies, and 1 in Logistics.

TMF’S OUTREACH INITIATIVES

In addition to all the core programs described above, Tech Mahindra Foundation is now also implementing several outreach projects in collaboration with various agencies. As part of these, the TMF team members are engaged in activities such as community health initiatives, teacher training, provision of content for other large-scale projects, etc. As part of such outreach projects, TMF supported 20,734 beneficiaries, taking the total tally of direct beneficiaries for the year to 61,995. This is nearly 50% more than the number of direct beneficiaries for FY 2021-22, which stood at 41,374.

MAHINDRA EDUCATIONAL INSTITUTIONS (MEI)

MEI - a not-for-profit, 100% subsidiary of the Company has set up Mahindra Ecole Centrale in August 2014 - through a collaborative venture between Mahindra Educational Institutions and Ecole Centrale of Paris, France (now known as Centrale Supelec) and the JNTU Hyderabad - to offer undergraduate engineering programs. Through this strong Indo-French Collaboration with Centrale Supelec and Industry connect with Tech Mahindra, MEC has emerged as a disruptive player in the field of Technical Education.

MEI has sponsored the setting up of Mahindra University to introduce diverse streams of education in addition to Engineering. Further the Engineering stream is being transitioned to Mahindra University.

MAHINDRA UNIVERSITY (MU)

Mahindra University ("MU”) (sponsored by Mahindra Educational Institutions, ("MEI”) - a not-for-profit, 100% subsidiary of Tech Mahindra), was notified on May 20, 2020 by the Government of Telangana vide The Telangana State Private Universities (Establishment and Regulation) Act, 2018 for "educating future citizens for and of a better world”.

The Ecole Centrale School of Engineering (ECSoE) currently runs various UG, PG and Ph.D. programs in cutting-edge engineering departments. ECSoE also launched a Centre for Life Sciences and offers courses in biotechnology and computational biology under it. The school plans to launch the 2.5 year integrated programs in Biotechnology & CSE for AY 2023-24.

Cornell University’s SC Johnson College of Business, an ivy league institution is the "Academic Partner” for School of Management. Mahindra University’s School of Management (MU - SoM) will benefit significantly from Cornell University’s expertise in curriculum development, faculty exchange programs including some specialty courses delivery by the Cornell faculty to Mahindra University students, as well as student immersion at Cornell. The School of Management currently conducts BBA, BA, E-MBA, and MBA (starting in 2023) programs.

The School of Law, Mahindra University, commenced operations in September 2021 in Hyderabad offering 5-year integrated programs in BA LL.B and BBA LL.B. It was founded on the philosophy of securing justice, equality, and service to all sections of society. With the needs of modern society evolving rapidly, there is a renewed focus on the importance of the discipline of

law. The School of Law will aim to make a difference to the legal profession and practice by providing a diverse, flexible curriculum and pedagogy, touching on several aspects of domestic and international law, while appraising the students of the latest trends in academia and practice. Starting 2022, the School of Law has launched a 3-year LLB (Hons) program and intend to launch a 6-year integrated B.Tech LLB course starting Academic Year 2023.

The University also plans to launch the following programs/schools for the Academic Year 2023-24:

1. School of Media

a. 4-year B.Tech. (Computation & Media)

b. 3-year BA (Digital Media & Communication)

2. School of Hotel Management

a. 3-year B.Sc. (Hospitality & Hotel Administration)

In the academic year 2022, a total of 2,971 students were studying under various programs across all schools and departments. The new admissions for academic year 2022 are 1,236 students of which 1,128 students are in various UG programs, including School of Management and School of Law, 22 students in the PG programs of School of Engineering and 86 students in the Ph.D programs across all the schools.

The Annual Report on CSR activities is provided as "Annexure VIII”.

SUSTAINABILITY

Your Company aligns closely with the Mahindra Group’s ambition to Rise: Be People positive, Planet positive, and Trust positive. The Company holistically embraces ever greater responsibility towards protecting the environment, empowering the society, and providing good governance.

Your Company’s strategy for creating long-term sustainable value is by improving, scaling, and transparently communicating our ecological, social, and economic impacts. Our strong governance framework led by the Board of Directors of your Company, who have oversight of the Company’s overall strategy and future direction and ensures the planning and implementation of environmental and social programs.

The Company’s holistic approach enables to drive sustainable impact in alignment with leading global frameworks, initiatives, and agendas committed to furthering sustainability such as the TCFD, SASB, GRI, as well as the Paris Agreement, the UNGC and the UN SDGs.

As a business, the Company recognizes the value of following the UN SDGs (Sustainable Development Goals) of People, Planet, Prosperity, and Partnership and continues to create value through initiatives that cater directly to these aspects of our performance.

People:

• Great place to work: Working to enhance our organizational culture by enabling our associates with access to advanced technologies, providing Learning & Development opportunities to help develop their skills and areas of expertise and providing them with robust career development programmes.

• Work-life balance: Providing feasible and flexible work-life balance and integration along with a range of associate-friendly policies and processes to reduce attrition.

• Diversity and inclusion: Ensuring that our organization continues to transcend into the realms of gender diversity and includes people with disabilities as well as people from the LGBTQIA community as part of being a socially responsible business.

• Employee engagement & recognition:

Ensuring our associates are engaged, feel valued, and recognized through a robust performance management system, a flexible system of working, and an extensive system of benefits and perquisites.

• Individual Social Responsibility: Encouraging associates to contribute to the society & environment and make these activities an integral part of their day-to-day activities.

Planet:

• Carbon neutrality and Net zero: Committing to carbon neutrality (2030) and Net zero (2035) by switching to renewable energy through on site installations and open access; improving energy efficiency through installation of LEDs, sensors; boosting green investments by

implementing Carbon Price; optimizing business travel by enabling virtual meetings; encouraging use of public transport and carpooling to reduce employee commute emissions; carbon sequestration through tree plantation; moving towards a low carbon economy by optimizing operations to ensure environmental protection.

• No waste to landfill: Installing Organic Waste Converters and vermicomposting plants at own campuses to convert food waste to manure, cutting down their transportation emissions and reducing waste to landfill.

• No to plastic: Maintaining plastic-free campuses and encouraging all stakeholders to use ecofriendly and biodegradable materials. Spreading awareness and initiating campaigns on preventing single-use plastic.

• Reduce, Reuse, Recycle, Recover: Implementing the process of Reduce, Reuse, Recycle and Recover across the value chain to limit waste and enable a circular economy.

• Being water positive: Improving water efficiency and increasing water savings by using water sensors, restrictors and water-efficient coolers, recycling wastewater through STPs, and recharging groundwater levels with Rainwater Harvesting Pits.

• Promoting Biodiversity: Protecting local flora and fauna across all our locations to ensure that we do not adversely impact biodiversity through our operations.

Prosperity:

• Innovation: Embracing technology and innovation by incorporating IoT, Blockchain, AI and Machine Learning to develop a portfolio of sustainable solutions that help reduce emissions and other negative impacts of climate change.

• Green solutions: Investing in Sustainability reporting solution (i.Sustain) and Climate Risk Management platforms, Smart grid, Microgrid-As-A-Service, Community Action Platform for Energy, Integrated Electric Vehicle Charging systems (IEVCS), Smart data hubs and Smart Cities for our Customers to reduce their carbon emissions.

• Connecting with customers: Embracing brand equity by connecting with our customers to address their current and future needs and ensuring customer satisfaction.

Partnership

• Learning and Sharing: Partnering with collaborators & partner companies to create an alliance ecosystem and supplement each other’s capabilities on joint projects. Collaborating with academia, businesses, NGOs, and governments to address some of the global challenges like health care, climate change, inequality, etc.

• Sustainable supply chain: Ensuring that we are in synch with our value chain in our commitment towards climate action and helping our suppliers follow the highest standards of sustainable and ethical best practices within their own organizations.

Tech Mahindra has drafted its Integrated Annual report in accordance with Global Reporting standards and frameworks with the data assured by a third party thus complying with the highest transparency standards.

The Company’s progress against the sustainability targets and metrics are disclosed in the externally assured Integrated reports available on the website of the company- https://www.techmahindra.com/en-in/ sustainability/

AWARDS AND RECOGNITION

Your Company continued its quest for excellence in its chosen area of business to emerge as a true global brand. Several awards and rankings continue to endorse your Company as a thought leader in the industry. A few of the prominent Awards / recognitions received by the Company during the Financial Year 2022-23 include:

• Tech Mahindra won several medals in the USA for its people practices- Brandon Hall HCM Excellence Awards, Stevie Awards for Great Employers and was also included in the 2023 Bloomberg Gender-Equality Index (GEI).

• Tech Mahindra Philippines was certified as a Great Place to Work.

• The Economic Times bestowed Tech Mahindra with several recognitions including Great Manager Awards (People Business), Human Capital Awards and ‘Best Organizations for Women’ (Femina).

• Tech Mahindra was also recognized by Avtar and Seramount as "Champions” in Most Inclusive Companies Index and "Top 10” in Best Companies for Women in India.

• Dun & Bradstreet India recognized Tech Mahindra as a top performer in the ESG Performance -Software and BPM sector.

• Tech Mahindra won Frost & Sullivan’s Technology Innovation Leadership Award 2022 for Metaverse Technology Services.

• Tech Mahindra was recognized among the Iconic brands at ET Iconic Brands 2022.

• TechM amplifAI0->^ is awarded "Cool Product or Service of the Year in Business 2022.” at the 12th Annual 2022 Business Excellence Awards by Globee® Business Awards.

• Tech Mahindra MEA was recognized for Ground-breaking products/services in Ecommerce at GITEX.

• Tech Mahindra was awarded ‘A’ rating in MSCI ESG ratings 2022.

• Tech Mahindra received the "Mahatma Award 2022 for Social Good & Impact - Decent Work and Economic Growth” for its SMART Program.

These awards are a reflection of the Company’s continued efforts in the fields of business, sustainability, human resource management and its sustained progress towards creating a better society for all.

ACKNOWLEDGEMENTS

Your directors place on records their appreciation for the contributions made by employees towards the success of your Company. Your directors gratefully acknowledge the co-operation and support received from the shareholders, customers, vendors, bankers, Regulatory and Governmental authorities in India and abroad.

For and on behalf of the Board

Anand G. Mahindra Place: Mumbai Chairman

Date: 15th June, 2023 (DIN: 00004695)

Note: The Board of Directors at its meeting held on April 27, 2023, had approved the financial statements for the financial year 2023 and the Director''s Report along with the Annexures. However, in view of the appointment of Mr. Mohit Joshi as Additional Director and Whole Time Director, the revised Director''s Report was approved by the Board at its Meeting held on June 15, 2023.

1

Interim Dividend (Special Dividend) for the Financial Year ended March 31, 2022 and Final Dividend for the Financial Year ended March 31, 2021


Mar 31, 2023

Your directors are pleased to present the Thirty Sixth Annual Report along with the audited accounts of your Company for the year ended March 31, 2023.

FINANCIAL RESULTS (STANDALONE)

('' in Million)

For the year ended March 31

2023

2022#

Income

437,856

372,079

Profit Before Interest, Depreciation and Tax

58,978

72,383

Interest

(1,808)

(689)

Depreciation

(8,129)

(7,403)

Profit Before Tax

49,041

64,291

Provision for Taxation

(11,266)

(14,058)

Profit After Tax

37,775

50,233

Other Comprehensive Income

(2,480)

1,200

Balance brought forward from previous year

216,090

203,329

Profit available for appropriation

253,917

253,292

Equity Dividends

(46,705)1

(43,624)1

Transfer to retained earnings on account of options lapsed

99

74

Transferred from Special Economic Zone re-investment reserve on utilization

7,151

6,348

Balance carried forward

214,462

216,090

# - Figures for the previous year are restated after considering the amalgamation of Tech Mahindra Business Services Limited and Born Commerce Private Limited with the Company.

1 Interim Dividend (Special Dividend) for the Financial Year ended March 31, 2023 and Final Dividend for the Financial Year ended March 31,2022

DIVIDEND

The Board of Directors on November 1, 2022 approved a special interim dividend of '' 18/- per share (i.e. 360%) on the par value of '' 5/- each which was paid by the Company to the shareholders whose names appeared in the Register of Members as on November 10, 2022, being the record date for the payment of dividend. Your Directors are pleased to recommend a final dividend of '' 32/- per share on par value of '' 5/- (i.e. 640%), payable to those Shareholders whose names appear in the Register of Members as on the Book Closure Date. Thus, the total dividend for the FY 2022-23 will be '' 50/- per share (i.e. 1000%) against the dividend of '' 45/- per share (i.e. 900%) paid for the Financial Year 2021-22.

The Board of your Company decided not to transfer any amount to the General Reserve for the year under review.

Your Company has formulated a Dividend Policy which is disclosed on the website of the Company and can be accessed at https://insights.techmahindra.com/ investors/tml-dividend-distribution-policy.pdf

SHARE CAPITAL

During the year under review, your Company allotted 2,313,996 equity shares on the exercise of stock options under various Employee Stock Option Schemes. Consequently, the issued, subscribed and paid-up equity share capital has increased from '' 4,859.17 million divided into 971,833,479 equity shares of '' 5/- each to '' 4,870.74 million divided into 974,147,475 equity shares of '' 5/- each.

ALTERATION OF ‘CAPITAL CLAUSE’ OF MEMORANDUM OF ASSOCIATION

Consequent to the merger of Tech Mahindra Business Services Limited and Born Commerce Private Limited with the Company, the Authorised Capital of the

Company increased from '' 8,336.50 million divided into 1,667,300,000 equity shares of '' 5/- each to '' 9,093 million divided into 1,818,600,000 equity shares of '' 5/- each.

Accordingly, the Capital Clause of the Memorandum of Association of the Company was altered and substituted with the new Clause V to reflect the corresponding changes in the Authorised Share Capital.

BUSINESS PERFORMANCE / FINANCIAL OVERVIEW

Imperative for businesses and your Company to stay relevant is the need to be cognizant of the tectonic shifts occurring around the world. Technological innovations, climate change and the need for inclusive growth and representation among others is defining the way organization’s function. Tech Mahindra has remained on the forefront of all cutting-edge technological advancements and harnessed many emerging technologies to transform customer and employee experiences. Your Company’s execution strategy is indexed to the pillars of client focus, portfolio synergy, operational rigor, new age technology bets and people transformation.

During the Financial Year ended on March 31, 2023, the Company’s revenues grew to '' 532,902 million on a consolidated basis as against '' 446,460 million in the previous year - indicating a robust growth of 19.4%. The growth was broad based across geographies as both Americas and Europe contributed in line with overall business growth. The Company also saw healthy growth across business segments in Communications, Media and Entertainment (CME) and Enterprise verticals.

The EBITDA on a consolidated basis for the Financial Year 2023 was '' 80,288 million, similar to the previous year’s EBITDA of '' 80,200 million. The resultant EBITDA margins were in the range of 15.1% in FY 2023 compared to 18.1% in FY 2022. The post-tax profit of the Company was reduced to '' 48,313 million in FY 2023 as against '' 55,661 million in FY 2022.

The Company saw robust demand for digital transformation services with a focus on customer experience and cloud. The Company has seen new deal wins close to USD 3,000 million during the year, indicating a healthy growth momentum across all business verticals. Your Company’s investments in Enterprise SaaS and Hi-tech capabilities will help

it cater to increasing modernization demands from businesses in the Financial Year 2024 and beyond.

MATERIAL CHANGES AND COMMITMENTS AFFECTING FINANCIAL POSITION BETWEEN THE END OF THE FINANCIAL YEAR AND THE DATE OF THE REPORT

There have been no material changes and commitments which affect the financial position of the Company that have occurred between the end of the financial year to which the financial statements relate and the date of this report.

ACQUISITIONS

Your company made the following acquisition during the FY 2022-23.

THIRDWARE SOLUTIONS LIMITED

The Company acquired 100% of the share capital of Thirdware Solutions Limited ("Thirdware”) on June 3, 2022 at a consideration up to USD 42 million including earnouts. Thirdware is a global player in Enterprise Applications and will enhance the Company’s digital solutions and services in automotive consultant and design, development and implementation in areas like ERP (Enterprise Resource Planning), EPM (Enterprise Performance Management), RPA (Robotic Process Automation) and IloT (Industrial Internet of Things). These capabilities will give the Company an edge in the manufacturing space.

UPDATE ON MERGER

Your directors at their meeting held on January 31, 2021 approved the Scheme of Merger of Tech Mahindra Business Services Limited (TMBSL) and Born Commerce Private Limited (Born) with the Company with the appointed date as April 1, 2021.

Hon’ble NCLT, Mumbai bench and Hon’ble NCLT, Chennai bench vide their order dated January 5, 2023 and January 12, 2023 respectively, approved the scheme of merger by absorption of the TMBSL and Born with the Company and their respective shareholders and the said Scheme has become effective on February 16, 2023.

SUBSIDIARIES, ASSOCIATES AND JOINT VENTURES OF THE COMPANY

The performance and financial position of the subsidiaries, associates, and joint venture companies included in the consolidated financial statement is provided in accordance with the provisions of Section

129 read with Rule 5 of the Companies (Accounts) Rules, 2014 containing the salient features of the financial statement of the Company’s subsidiaries/joint ventures or associate companies in Form AOC - 1 in “Annexure I” to this report.

Pursuant to Rule 8(5)(iv) of the Companies (Accounts) Rules, 2014, the names of the companies which have been incorporated or ceased to be the subsidiaries, joint ventures or associate companies during the year are provided in “Annexure II” to this report. The Company is actively pursuing the initiative on the consolidation of its subsidiaries/branches to optimize the operational costs. During the year under review, your Company has closed/merged twenty subsidiaries.

HUMAN RESOURCES

The employees of the Company are the most critical asset to your Company. The Company has taken several steps to protect, retain, and improve the competencies of these assets including:

Hiring: Forecast to Fulfilment

Your Company has streamlined its talent hiring process adopting some best-in-class practices. By building predictability in talent planning & forecasting for new age skills, your Company has been able to fuel business growth. Your Company has revamped its Buddy Referral programs to recruit talent from existing employee networks while offering attractive incentives. Embracing diversity in the hiring process has improved the global and local representation of talent within the organization. The Company has also redesigned its Candidate Engagement process to focus on creating positive experiences from the issuing joining offer letter to internal deployment to client projects. With rigor in talent allocation and proactive skilling of bench talent, your Company has been able to increase its internal fulfilment to 71% from 48% which is the best in the industry.

Learning: Skilling on the job

With the growth in digital business, your Company has been transforming its workforce both at speed and scale. The Company accelerated skilling initiatives to keep up with the pace of technological developments and built a ‘future-ready’ talent pool. #NAD Learn, the Al-based platform with interactive, on-demand, contextual and hyper-personalised up-skilling is helping the Company develop full-stack professionals. Your Company has supplemented this with young leadership development programs as well

as new policies to promote niche skilling and fast-track career growth. Employees can learn and grow as a Fresher through Elevate, in customer deployments through Project Skilling, for career progression through Future Skilling and into the leadership pipeline through journey-based programs. The Company also offers super-specialization skilling programs including Architect CoE, HiPOT programs at units and Program Manager CoE through EMBARK. Some new programs that the Company has recently launched for high-potential talent development include MALT and TrIBE.

Leadership: Integrative Thinking

The natural culture of empowerment that was supercharged during the pandemic continues to be the mainstay in the current hybrid work environment. Your Company aims to help employees imbibe mindsets & behaviors for the future which include a renewed focus on Integrative Thinking, Business & Financial Acumen, Bias for Action, Closure over Follow-up, Data over Emotions and Extreme Ownership. This was reinforced through the adoption of an industry leading learning platform - Harvard Manage Mentor Spark aimed at imparting best-in-class training at every level in realtime. Your Company has a robust Talent Management process for developing the leadership talent pipeline and has adopted consistent coaching practices for managers. Apart from Coaching, the employees have experienced new forms of learning with technology-enabled tools and pedagogies. For example, the ‘Wheel of Life’ is a customized self-coaching tool with gamified journeys, and personalized Habit Tracking making personal and professional well-being goals accessible to every employee.

Performance: Feedback focused

Your Company launched the Annual Performance Feedback cycle in December 2022. In order to build a culture where performance is enabled through feedback, Managers have been trained to have better performance review dialogues with their direct reports and work on an outcome-based evaluation rather than process or effort measurement. Your Company is creating a High-Performance Culture through hyper-personalized Incentive plans. Your Company has a suite of Incentive plans that are designed to create a strong alignment between Individual growth and Organization performance.

Wellness: Collective well-being

Your Company puts a happier, healthier and more productive workforce at the core of its business, policies and decisions. Your Company has designed

initiatives covering eight dimensions of wellness -Physical, Occupational, Emotional, Spiritual, Social, Environmental, Financial and Intellectual. The focus on preventative care with Corporate paid preventive health check, on-campus doctor consultations & counselling programs, helps employees diagnose any health condition in advance. To tackle IT industry specific issues, the Company organizes wellness sessions on Ergonomics, Healthy eating, Lifestyle management etc. Multiple tech-enabled wellness interventions like Kick the Butt (Smoking Cessation Program), Bend it like TechM (Guide to Ergonomics), Dump the Plump (Weight loss challenge) etc. have helped employees create healthier habits. Through the People Care program, managers are encouraged to show their human side and empower their team members to pursue collective well-being.

Communication: Building purpose

A robust communication process is at the heart of the Company’s vibrant culture. Employees are kept connected and informed through multiple media. Your Company’s 360-degree communication framework ensures employees have access to connect with leaders, peers and the external world. With publications, platforms, storytelling, campaigns, and connects, the organizational culture is shared with all. Your Company shares stories of diverse individuals achieving extraordinary things using structured formats like #RiseFromWithin. Leaders in the Company share not just business updates and success stories but personal anecdotes that reinforce the belief of a shared destiny.

Engagement: Hybrid connects

For an increasingly hybrid workplace, the Company has designed several virtual ‘water-cooler’ moments like All Hand Meets with CXO, Prime Time, Location Connects etc. along with family connects. Employees have platforms like MS Teams and Cisco WebEx for collaborative yet decentralized working. Your Company also organized on-ground engagement linked to TechM’s FIDE partnership for the Chess Olympiad. TechM CARES Action Planning workshops were also organized across different business units to implement changes based on employee feedback. Your Company also organized more than 1,200 engagement programs globally linked to Rise Refresh.

Rise Refresh: #TogetherWeRise

For more than a decade, the Rise philosophy has inspired employees from across the Mahindra Group to come to work and build something meaningful.

Since then, the world has changed with the rise of disruptive technologies, changing start-up ecosystem, climate change and recently, the pandemic. This is why, the Company has defined a new core purpose and brand pillars of Rise to simplify and sharpen its commitments. Your Company has leveraged every possible medium to ensure that this is communicated to all employees. From the conventional posters, communities, blogs, leader-bytes, microsite, quizzes and signatures route to the unconventional music, memes, WhatsApp stickers, GenZ lingo, podcast conversations and comic strips, Rise has touched the heart of every employee.

Diversity: Respecting Individuality

Your Company believes that respecting diversity and ensuring inclusion is fundamentally the right thing to do. It respects, embraces and celebrates the uniqueness of every individual. This also links back to the stated objective of the Company to be human-centered by encouraging associates to bring their most authentic selves to work. Your Company initiated the Maternity Assistance Program (MAP) to support employees who were on Maternity Leave in their transition back to work. The Company has also organized several Fireside chats featuring women with STEAM (Science, Technology, Engineering, Arts, Mathematics) roles to inspire others to grow in these fields. Through the ‘Restart’ Program, the Company aims to help Women IT Professionals restart their career after a break.

Recognition: Appreciation always

Your Company believes in appreciating, recognizing, and celebrating by building a culture where good work and behavior are appreciated. The Company has designed specialized recognition programs where rewards, tenure, performance, and contribution are celebrated, often with the loved ones of employees. The recognition program is centered around n = 1, that is, the individual at the heart of everything. A key part of personalizing recognition is to bring it to the desk of every employee. This is enabled by the KUDOS portal that offers recognition badges as well as redemption options for the points earned. Giving employees the ability to appreciate colleagues and sustained campaigns have led your Company to have an industry leading rewards penetration of ~74% including monetary and non-monetary recognition. Tenure is rewarded with personalized gifts for both the employee and their family members. Lastly, there are several organizational level awards for outstanding achievements like the ACE, STAR, Location Council and Spotlight awards.

HR Digitization: Experiencing technology

Your Company has revolutionized employee experience by deploying technology at different touchpoints of their lifecycle. Your Company continued its internal automation focus by using Robotic Process Automation for completing common workforce actions to reduce manual work. Your Company has also integrated HR Chatbot UVO and Technical Support Chatbot ATOM into MS Teams making it easier to perform workforce actions like leave applications, pending approvals, ticket registrations etc. Developing an "Attrition Prediction Model” has provided Your Company with an early warning system predicting the employees’ likelihood to quit, giving the Business HR team the ability to stage an intervention. The Company has also explored the use of Metaverse where three dimensional avatars interact in a virtual world to develop modules for hiring and on-boarding. Translating these experiences to mobile devices, the Company has developed ‘The Wheel of Life’ application as a self-coaching tool.

QUALITY

The Company continues its focus on quality and strives to exceed customer expectations at all times. During the year, it continued to strengthen the implementation of Quality systems and upgraded the processes/systems to comply with CMMI V 2.0 for both Development and Services and currently assessed for maturity level 5. Similarly it underwent various upgrade and re-certification audits for multiple standards during the year in order to meet client demands and enhance value delivery - successfully re-certified, ISO 9001:2015 (Quality Management System), ISO 20000-1:2018 (Information Technology Service Management System), ISO 27001:2013 (Information Security Management System), ISO 27701:2019 (Privacy Information Management System), TL9000 R 6.2/ R5.7 (Quality Management Systems for Tele Communications industry), ISO 13485:2016 (Quality Management Systems for medical devices - scope of certification limited to medical devices business within Tech Mahindra), AS9100 Rev D (Standard for Aerospace domain - scope of certification limited to the aerospace business within Tech Mahindra), ISO 17025:2017 - Laboratory Quality Management Systems for our device testing labs.

In addition to these, your Company also maintains its commitment to health, safety and environment by continually improving its processes in accordance with ISO 14001:2015 (Environmental Management System) and ISO 45001: 2018 (Occupational Health and Safety

Assessment Series) standards. Your Company is also certified on ISO 22301:2012 (Societal Security and Business Continuity Management System) and has a comprehensive Business Continuity and Disaster Recovery framework, to prevent potential business disruptions in the event of any disaster. It has processes that helped resume services to customer’s acceptable service levels. Automated Service Desk with SLAs for enabling business and Vulnerability Assessment and Penetration Testing Lab for secured corporate network operations are highlights that showcase the information security posture of the Organization.

Tech Mahindra (IT Division) has been assessed for the implementation of high maturity business excellence practices at Mahindra Group (Services Sector). It has been assessed at TMW Maturity Stage 7 (on scale of 1-10 stages) of Mahindra Business Excellence Framework - The Mahindra Way. These certifications are testimony of the robustness of business processes and at large, the quality culture imbibed in the organization.

Your Company has institutionalized the Deliverability Risk Assessment (DRA) practice - to assess the readiness and to identify risks at the beginning of the program, continued to strengthen the process for transforming Quality Assurance processes & delivery methods to adopt and strengthen Delivery excellence, Risk governance, and further enhance automation to enable quality delivery to the customer. Quality index which is a measure of quality of products and services delivery is institutionalized.

The Company is ensuring all these initiatives are in place, to ensure that it delivers as stated in its Quality Policy.

DIRECTORS

During the year under review, all Independent Directors have given declarations that they meet the criteria of Independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Independent Directors have also given declaration of compliance with Rules 6(1) and 6(2) of the Companies (Appointment and Qualification of Directors) Rules, 2014, with respect to their name appearing in the data bank of Independent Directors maintained by the Indian Institute of Corporate Affairs.

Pursuant to the provisions of Section 152(6)(c) of the Companies Act, 2013, Mr. Manoj Bhat, Director (DIN: 05205447) is liable to retire by rotation and being eligible offers himself for reappointment.

During the year under review, Ms. Penelope Fowler (DIN: 09591815) was appointed as Additional Director by the Board of Directors of the Company on May 13, 2022. She was further appointed as an Independent Director pursuant to the special resolution passed by the shareholders at the Annual General Meeting held on July 26, 2022 for a period of 5 years.

In view of the retirement of Mr. C. P Gurnani, Managing Director and CEO, the Board of Directors at its meeting held on June 15, 2023, based on the recommendation of the Nomination and Remuneration Committee approved the Appointment of Mr. Mohit Joshi, (DIN: 08339247) as Additional Director with effect from June 20, 2023 to hold office up to the date of ensuing Annual General Meeting. Further in order to ensure smooth transition into the role of Managing Director as Mr. C. P. Gurnani would retire on December 19, 2023, Mr. Mohit Joshi was also appointed as a Whole Time Director designated as Managing Director (Designate) and Key Managerial Personnel with effect from June 20, 2023 up to December 19, 2023 subject to the approval of the members of the Company and the Central Government.

The Board of Directors, based on the recommendation of Nomination and Remuneration Committee also approved the appointment of Mr. Mohit Joshi as Managing Director & Chief Executive Officer of the Company and Key Managerial Personnel under the Companies Act, 2013 from December 20, 2023 to June 19, 2028 (both days inclusive), subject to approval of the members of the Company and the Central Government.

The Board recommends the appointment of Mr. Manoj Bhat and Mr. Mohit Joshi to the Members at the ensuing Annual General Meeting. The brief profile of Mr. Manoj Bhat and Mr. Mohit Joshi is given in the Notice of the Annual General Meeting.

In terms of Regulation 24(1) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations 2015, Mr. T. N. Manoharan, Lead Independent Director of the Company has been appointed as Director on the Board of Tech Mahindra (Americas) Inc., a wholly

owned unlisted material subsidiary of the Company with effect from May 21, 2019.

In the opinion of the Board of Directors, the Independent Directors have relevant proficiency, expertise and experience.

FAMILIARISATION PROGRAMME

These programmes aim to provide insights into the Company to enable the Independent Directors to understand its business in depth and contribute significantly to the Company. The details of the program for familiarisation of the Independent Directors with the Company are available on its website and can be accessed at https://insights.techmahindra.com/ investors/tml-familarisation-progarmmes-for-IDs.pdf

The Board of Directors are regularly updated on changes in statutory provisions like amendments in Corporate Laws, SEBI Regulations, Taxation Laws and People related laws as applicable at the quarterly Board meetings. The Board members are also updated on the Risk universe applicable to the Company’s business. The MD & CEO of the Company had quarterly sessions with Board members sharing updates about the Company’s business strategy, operations and the key trends in the IT industry that are relevant to the Company. These updates help the Board members in keeping abreast of key changes and their impact on the Company. Further Subject Knowledge Experts from various fields are also invited to the meetings of the Board/Committees to appraise the Board Members of the latest developments in the IT and the business.

TRAINING

The Company has laid down a policy on the training of Independent Directors as part of its governance policies. The Senior Leadership of the Company periodically updates the Directors on regulatory changes, business strategy and operations.

BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and Regulation 19 read with Schedule II, Part D of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has devised a policy on evaluating the performance of the Board of Directors, the Chairman, Committees, and Individual Directors. The evaluation process was carried out through a web-based portal. The summary of the evaluation reports

was presented to the respective Committees and the Board. The Directors had given positive feedback on the overall functioning of the Committees and the Board. The suggestions made by the Directors in the evaluation process have been suitably incorporated in the processes.

NUMBER OF MEETINGS OF THE BOARD

The Board met five times during the Financial Year 2022-23. The meeting details are provided in the Corporate Governance report that forms part of this Annual Report. The maximum interval between any two meetings did not exceed 120 days as prescribed in the Companies Act, 2013 and SEBI Listing Regulations.

COMMITTEES OF THE BOARD

As on March 31, 2023, the Board has constituted seven Committees, namely, Audit Committee, Nomination and Remuneration Committee, Stakeholders Relationship Committee, Risk Management Committee, Corporate Social Responsibility Committee, Investment Committee and Securities Allotment Committee. The details of terms of reference of each Committee and the meetings held during the year are given in the Corporate Governance Report.

The Company has also formed Group Governance Council comprising of Board Members and Senior Management in terms of the SEBI Circular No. SEBI/ HO/CFD/CMD/CIR /P/2018/79 dated May 10, 2018, considering it has a large number of subsidiaries.

POLICY ON DIRECTORS’ APPOINTMENT AND REMUNERATION

The Governance policies laid down by the Board of Directors of your Company include:

i. Policy on the appointment and removal of Directors, Key Managerial Personnel and Senior Management.

ii. Policy on remuneration to the Directors, Key Managerial Personnel and Senior Management and other Employees.

The extract of these two policies is provided in "Annexure III”.

The policies are available on the website of the Company and can be accessed at https://insights. techmahindra.com/investors/Governance-Policies-including-remuneration-to-Directors-KMPS.pdf

SUCCESSION PLAN

In accordance with the principles of transparency and consistency, your Company has adopted governance policies for appointments, remuneration and evaluation of its Board of Directors, Key Managerial Personnel & Senior Management. In line with these Governance policies, the Company has established a formal Succession Planning Program for Key Managerial Personnel across the organization. The Board evaluates all such plans at a regular interval and institutes a formal program for filling any such critical position. The Board evaluates both internal and external candidates for such positions along with the recommendations of the management. The Company also has a leadership development program where it identifies high potential managers, and trains them to take up the positions of higher responsibility. The Company has identified the second line of leadership, which provides stability to the business in case of contingencies.

KEY MANAGERIAL PERSONNEL (KMP)

Pursuant to provisions of Section 203 of the Companies Act, 2013, Mr. C. P. Gurnani, Managing Director & Chief Executive Officer, Mr. Milind Kulkarni, Chief Financial Officer (up to May 31, 2022), Mr. Rohit Anand, Chief Financial Officer (w.e.f. June 1, 2022) and Mr. Anil Khatri, Company Secretary & Compliance Officer were the Key Managerial Personnel of the Company during the year under review.

DIRECTORS’ RESPONSIBILITY STATEMENT

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

i. in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

ii. they have, in the selection of the accounting policies, consulted the Statutory Auditors and these have been applied consistently and, reasonable and prudent judgments and estimates have been made so as to give a true and fair view of the state of affairs of the Company as at March 31, 2023 and of the profit of the Company for the year ended on that date;

iii. proper and sufficient care had been taken 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 other irregularities;

iv. the annual accounts have been prepared on a going concern basis;

v. they had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively;

vi. the proper systems to ensure compliance with the provisions of all applicable laws are in place and are adequate and operating effectively.

DETAILS WITH RESPECT TO ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS

The Company has internal financial controls which are adequate and were operating effectively. The controls are adequate for ensuring the orderly and efficient conduct of the business, including adherence to the Company’s policies, the safeguarding of assets, the prevention and detection of frauds and errors, the accuracy and completeness of accounting records and timely preparation of reliable financial information.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS / PROCEEDINGS

There are no significant and material orders passed by the regulators or courts or tribunal, impacting the going concern status and the Company’s operations in the future.

Further no application against the Company has been filed or is pending under the Insolvency and Bankruptcy Code, 2016, nor has the Company done any one-time settlement with any Bank or Financial institutions.

STATUTORY AUDITORS

The members, in the 35th Annual General Meeting (AGM) held on July 26, 2022, appointed M/s. B S R & Co. LLP, Chartered Accountants, [ICAI Firm’s Registration No. 101248W/W- 100022] as the Statutory Auditors of the Company, to hold office for a further term of five consecutive years from the conclusion of the 35th AGM of the Company held in

the Financial Year 2021-22 until the conclusion of the AGM of the Company for the Financial Year 2026-27 on such remuneration as may be determined by the Board of Directors.

There are no qualifications, reservations, adverse remarks or disclaimers made in the audit report for the Financial Year 2022-23.

SECRETARIAL AUDIT REPORT

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 had appointed Makarand Lele & Co., Practicing Company

Secretary, Pune to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is available at "Annexure IV” to this report. There are no qualifications, reservations, adverse remarks or disclaimers made in the Secretarial Audit Report.

COMPLIANCE WITH SECRETARIAL

STANDARDS

The Company has complied with the applicable Secretarial Standards.

ANNUAL RETURN

Pursuant to the provisions of Section 92(3) read with Section 134(3) (a) of the Companies Act, 2013, the Annual Return in Form MGT-7 is available on the website of the Company and can be accessed at https://insights.techmahindra.com/investors/mgt-7.pdf

INVESTOR EDUCATION AND PROTECTION FUND (IEPF)

During the year, the Company has transferred the unclaimed dividends of '' 2,13,40,674 to the Investor Education and Protection Fund. Further, 2,26,700 corresponding shares on which dividends were unclaimed for seven consecutive years were transferred to the fund as per the requirements of the IEPF Rules. The Members are requested to check the details of the unpaid dividend on the website of the Company and claim their dividend to avoid the shares from being transferred to IEPF.

MANAGERIAL REMUNERATION

Disclosures of the ratio of the remuneration of each director to the median employee’s remuneration and other details as required pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of

Managerial Personnel) Rules, 2014 as amended from time to time, are provided as "Annexure V”. None of the Directors or the Managing Director & CEO of the Company received any remuneration or commission from Subsidiary Companies of your Company.

The details of remuneration paid to the Directors including the Managing Director & CEO of the Company are provided in the Corporate Governance Report.

PARTICULARS OF EMPLOYEES

The information required under Section 197(12) of the Companies Act, 2013 ("the Act”) read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms part of this Report. However, pursuant to first proviso to Section 136(1) of the Act, this report is being sent to the Shareholders excluding the aforesaid information. Any shareholder interested in obtaining said information may write to the Company Secretary at the Registered Office / Corporate Office of the Company and the said information is open for inspection at the Registered Office of the Company.

POLICY ON PREVENTION OF SEXUAL HARASSMENT

Your Company has laid down the Prevention of Sexual Harassment (POSH) policy which is available on its website. The Company has zero tolerance on Sexual Harassment at workplace. During the year under review, there were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

The status of complaints received under POSH and redressed by the POSH Committee of the Company, during the Financial Year under review, are given below:

a) Number of complaints received during the year - 74

b) Number of complaints redressed during the year - 73@

c) Number of complaints pending for redressal as on March 31, 2023 - 3

@ - Includes 2 complaints received during the previous year and redressed during the year.

There are focused campaigns on the POSH policy within the Company and awareness drives that

take place. Furthermore, employees are required to undertake a mandatory certification on POSH to sensitize themselves and strengthen their awareness.

EMPLOYEE STOCK OPTION SCHEMES

During the year under review, there were no material changes in the Employee Stock Option Schemes (ESOPs) of the Company and the Schemes are in compliance with the SEBI Regulations on ESOPs.

As per Regulation 14 of Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021, the details of the ESOPs are uploaded on the website of the Company and can be accessed at https://insights.techmahindra. com/investors/details-of-esops-fy-2022-23.pdf

CORPORATE GOVERNANCE

A report on Corporate Governance covering among others composition of the Board of Directors, details of meetings of the Board and Committees along with a certificate for compliance with the conditions of Corporate Governance in accordance with the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, issued by the Statutory Auditors of the Company, forms part of this Annual Report.

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.

BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT (BRSR)

SEBI, vide its circular dated May 10, 2021, made BRSR mandatory for the top 1,000 listed companies (by market capitalization) with effect from the FY 2022-23. The Company voluntarily published BRSR for the Financial year 2021-22. The BRSR Report for the year 2022-23 is enclosed as part of this Annual Report.

In addition to the BRSR, the Integrated Annual Report of the Company provides an insight on the various ESG initiatives adopted by the Company. The ESG disclosures have been independently assured by KPMG.

COST RECORDS

Maintenance of cost records and requirement of cost audit as prescribed under the provisions of Section 148(1) of the Companies Act, 2013 are not applicable for the business activities of the Company.

RISK MANAGEMENT

The Risk Management Committee of the Board of Directors devised a Risk Management Policy and guides the operating management to identify risks, analyze their probability and impact and prepare mitigation plans. It periodically reviews the Risk Management Framework & Enterprise Risk Register which is presented by the Chief Risk Officer. The Company identifies all potential risks viz. economic, business, currency, operations, climate, governance, finance, cyber, business continuity etc. and prepares a mitigation plan for each of the risks. The elements of risk as identified by the Company with the impact and mitigation strategy are set out in the Management Discussion and Analysis Report.

ESTABLISHMENT OF VIGIL MECHANISM

The Company has laid down Whistle Blower Policy covering Vigil Mechanism with protective clauses for the Whistle Blowers. The Whistle Blower Policy is made available on the website of the Company.

DEPOSITS / LOANS & ADVANCES, GUARANTEES OR INVESTMENTS

The Company has not accepted any deposits from the public during the year under review. The particulars of loans/advances, guarantees and investments under Section 186 of the Companies Act, 2013 are given in the notes forming part of the Financial Statements.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All transactions entered with Related Parties as defined under Section 2(76) of the Companies Act, 2013 and Regulation 23 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, ("The Listing Regulations”), during the financial year under review were in the ordinary course of business and at an arm’s length pricing basis and do not attract the provisions of Section 188 of the Companies Act, 2013. There were no transactions with related parties in the Financial Year which conflicted with the interest of the Company and required compliance of the provisions of Regulation 23 of the Listing Regulations.

Suitable disclosure as required by the Indian Accounting Standards (Ind AS 24) has been made in the notes forming part of the Financial Statements.

The Company has formulated a policy on the Related Party Transactions and dealing with Related Party Transactions which has been uploaded on the website of the Company and can be accessed at https:// insights.techmahindra.com/investors/Related-Party-Transactions-Policy.pdf

The particulars of related party transactions in prescribed Form AOC - 2 are attached as ‘Annexure VI”. Pursuant to Regulation 23(9) of the Listing Regulations, your Company has filed half yearly report on Related Party Transactions with the stock exchanges.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars as prescribed under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 are provided in "Annexure VII” which forms part of this report.

CORPORATE SOCIAL RESPONSIBILITY

The CSR vision of the Company is "Empowerment through Education.”

In compliance with the guidelines prescribed under Section 135 of the Companies Act, 2013, your Company has constituted a Corporate Social Responsibility (CSR) Committee of the Board. The CSR policy, covering the Objectives, Focus Areas, Governance Structure Monitoring and Reporting Framework among others is approved by the Board of Directors. In accordance with the amendments made in Section 135 in January 2021, the CSR Policy has been duly revised and is available on the website of the Company and can be accessed at https://insights. techmahindra.com/investors/tml-csr-policy-23.pdf

The Company has spent more than 2% of the average net profits of the Company during the three immediately preceding Financial Years on CSR.

The Company’s social initiatives are mainly carried out by Tech Mahindra Foundation and Mahindra Educational Institutions, Section 8 (erstwhile Section 25) Companies promoted by the Company.

TECH MAHINDRA FOUNDATION (TMF) EDUCATION

The key initiatives taken by TMF in the arena of school education include:

ALL ROUND IMPROVEMENT IN SCHOOL EDUCATION (ARISE)

Tech Mahindra Foundation’s educational initiatives under ARISE are long-term school improvement programmes, in partnership with local governments and partner organisations. The Foundation in 2022-23 worked with 18 government primary & secondary schools to transform them into model schools of excellence. A total of 5,224 students were positively impacted under this programme, of which 2,832 were girls.

During the year, the Foundation expanded its work for children with special needs through its ARISE programme. This programme is a variant of ARISE in which children with special needs are provided chronic therapy as well as special education to help them lead more fulfilling lives. Through 32 projects, the programme enabled 4,829 children with special needs to become better learners with greater independence in managing their lives. The Foundation has taken up the provision of assistive technology for these children as an important value addition to its work in ARISE .

SHIKSHAANTAR

Shikshaantar, envisioned as a programme for enhancing the capacity of government school teachers, has emerged as an important programme in the education portfolio of the Foundation. TMF works with the Municipal Corporation of Delhi by running their In-Service Teacher Education Institutes. With the merger of the MCDs, TMF now has the responsibility of training teachers from close to 1,500 primary schools in Delhi. During the year under review, as many as 4,379 teachers were trained as part of Shikshaantar. This included specially designed modules for Digital Literacy, Child Safety, Cyber Security and Mental Health that were delivered to the teachers in a hybrid mode.

MOBILE SCIENCE LAB & ROBOTICS LAB

In order to increase the footprint of its work in Education and reach the unreached, TMF launched a unique initiative in 2019-20 - The Mobile Science Lab (MSL). For this, a Mahindra bus has been remodeled to become a science lab on wheels and has been travelling from school to school in East Delhi to provide STEM learning for children in grades 3 and 4 in these

schools. The MSL program benefitted as many as 6,861 students and 77 teachers throughout the year.

Following the success of the MSL program, TMF has also set up a Robotics Lab at one of its ARISE schools in Delhi which is an all-girls school. This lab was inaugurated in November 2022, and nearly 300 girls from this school are the potential beneficiaries.

EMPLOYABILITY

Skills-for-Market Training (SMART) is the Foundation’s flagship programme in employability. It is built on the vision of an educated, enabled and empowered India, and the belief that educated and skilled youth are the country’s true strength. The programme started with 3 Centres in 2012 and is currently running over 85 Centres at 10 locations across India. These include SMART Centres, SMART Centres (training for people with disabilities), and SMART-T Centres (training in technical trades).

In 2022-23, your Company trained 17,641 young women and men under its SMART program, of which, 1,303 were persons with disabilities. More than 70% of the graduates are placed in jobs across multiple industries upon successful completion of the training. The average salaries being earned by the graduates of the SMART program have been steadily rising and saw a 10% jump over the previous year.

The Foundation’s commitment to setting new benchmarks in skill development in India has been underscored by the setting up of Tech Mahindra SMART Academies, which provide the highest quality of skill training to youngsters in Healthcare and Digital Technologies. During FY 2022-23, 3,584 students were trained at the nine Academies that are now functional - 5 in Healthcare, 3 in Digital Technologies, and 1 in Logistics.

TMF’S OUTREACH INITIATIVES

In addition to all the core programs described above, Tech Mahindra Foundation is now also implementing several outreach projects in collaboration with various agencies. As part of these, the TMF team members are engaged in activities such as community health initiatives, teacher training, provision of content for other large-scale projects, etc. As part of such outreach projects, TMF supported 20,734 beneficiaries, taking the total tally of direct beneficiaries for the year to 61,995. This is nearly 50% more than the number of direct beneficiaries for FY 2021-22, which stood at 41,374.

MAHINDRA EDUCATIONAL INSTITUTIONS (MEI)

MEI - a not-for-profit, 100% subsidiary of the Company has set up Mahindra Ecole Centrale in August 2014 - through a collaborative venture between Mahindra Educational Institutions and Ecole Centrale of Paris, France (now known as Centrale Supelec) and the JNTU Hyderabad - to offer undergraduate engineering programs. Through this strong Indo-French Collaboration with Centrale Supelec and Industry connect with Tech Mahindra, MEC has emerged as a disruptive player in the field of Technical Education.

MEI has sponsored the setting up of Mahindra University to introduce diverse streams of education in addition to Engineering. Further the Engineering stream is being transitioned to Mahindra University.

MAHINDRA UNIVERSITY (MU)

Mahindra University ("MU”) (sponsored by Mahindra Educational Institutions, ("MEI”) - a not-for-profit, 100% subsidiary of Tech Mahindra), was notified on May 20, 2020 by the Government of Telangana vide The Telangana State Private Universities (Establishment and Regulation) Act, 2018 for "educating future citizens for and of a better world”.

The Ecole Centrale School of Engineering (ECSoE) currently runs various UG, PG and Ph.D. programs in cutting-edge engineering departments. ECSoE also launched a Centre for Life Sciences and offers courses in biotechnology and computational biology under it. The school plans to launch the 2.5 year integrated programs in Biotechnology & CSE for AY 2023-24.

Cornell University’s SC Johnson College of Business, an ivy league institution is the "Academic Partner” for School of Management. Mahindra University’s School of Management (MU - SoM) will benefit significantly from Cornell University’s expertise in curriculum development, faculty exchange programs including some specialty courses delivery by the Cornell faculty to Mahindra University students, as well as student immersion at Cornell. The School of Management currently conducts BBA, BA, E-MBA, and MBA (starting in 2023) programs.

The School of Law, Mahindra University, commenced operations in September 2021 in Hyderabad offering 5-year integrated programs in BA LL.B and BBA LL.B. It was founded on the philosophy of securing justice, equality, and service to all sections of society. With the needs of modern society evolving rapidly, there is a renewed focus on the importance of the discipline of

law. The School of Law will aim to make a difference to the legal profession and practice by providing a diverse, flexible curriculum and pedagogy, touching on several aspects of domestic and international law, while appraising the students of the latest trends in academia and practice. Starting 2022, the School of Law has launched a 3-year LLB (Hons) program and intend to launch a 6-year integrated B.Tech LLB course starting Academic Year 2023.

The University also plans to launch the following programs/schools for the Academic Year 2023-24:

1. School of Media

a. 4-year B.Tech. (Computation & Media)

b. 3-year BA (Digital Media & Communication)

2. School of Hotel Management

a. 3-year B.Sc. (Hospitality & Hotel Administration)

In the academic year 2022, a total of 2,971 students were studying under various programs across all schools and departments. The new admissions for academic year 2022 are 1,236 students of which 1,128 students are in various UG programs, including School of Management and School of Law, 22 students in the PG programs of School of Engineering and 86 students in the Ph.D programs across all the schools.

The Annual Report on CSR activities is provided as "Annexure VIII”.

SUSTAINABILITY

Your Company aligns closely with the Mahindra Group’s ambition to Rise: Be People positive, Planet positive, and Trust positive. The Company holistically embraces ever greater responsibility towards protecting the environment, empowering the society, and providing good governance.

Your Company’s strategy for creating long-term sustainable value is by improving, scaling, and transparently communicating our ecological, social, and economic impacts. Our strong governance framework led by the Board of Directors of your Company, who have oversight of the Company’s overall strategy and future direction and ensures the planning and implementation of environmental and social programs.

The Company’s holistic approach enables to drive sustainable impact in alignment with leading global frameworks, initiatives, and agendas committed to furthering sustainability such as the TCFD, SASB, GRI, as well as the Paris Agreement, the UNGC and the UN SDGs.

As a business, the Company recognizes the value of following the UN SDGs (Sustainable Development Goals) of People, Planet, Prosperity, and Partnership and continues to create value through initiatives that cater directly to these aspects of our performance.

People:

• Great place to work: Working to enhance our organizational culture by enabling our associates with access to advanced technologies, providing Learning & Development opportunities to help develop their skills and areas of expertise and providing them with robust career development programmes.

• Work-life balance: Providing feasible and flexible work-life balance and integration along with a range of associate-friendly policies and processes to reduce attrition.

• Diversity and inclusion: Ensuring that our organization continues to transcend into the realms of gender diversity and includes people with disabilities as well as people from the LGBTQIA community as part of being a socially responsible business.

• Employee engagement & recognition:

Ensuring our associates are engaged, feel valued, and recognized through a robust performance management system, a flexible system of working, and an extensive system of benefits and perquisites.

• Individual Social Responsibility: Encouraging associates to contribute to the society & environment and make these activities an integral part of their day-to-day activities.

Planet:

• Carbon neutrality and Net zero: Committing to carbon neutrality (2030) and Net zero (2035) by switching to renewable energy through on site installations and open access; improving energy efficiency through installation of LEDs, sensors; boosting green investments by

implementing Carbon Price; optimizing business travel by enabling virtual meetings; encouraging use of public transport and carpooling to reduce employee commute emissions; carbon sequestration through tree plantation; moving towards a low carbon economy by optimizing operations to ensure environmental protection.

• No waste to landfill: Installing Organic Waste Converters and vermicomposting plants at own campuses to convert food waste to manure, cutting down their transportation emissions and reducing waste to landfill.

• No to plastic: Maintaining plastic-free campuses and encouraging all stakeholders to use ecofriendly and biodegradable materials. Spreading awareness and initiating campaigns on preventing single-use plastic.

• Reduce, Reuse, Recycle, Recover: Implementing the process of Reduce, Reuse, Recycle and Recover across the value chain to limit waste and enable a circular economy.

• Being water positive: Improving water efficiency and increasing water savings by using water sensors, restrictors and water-efficient coolers, recycling wastewater through STPs, and recharging groundwater levels with Rainwater Harvesting Pits.

• Promoting Biodiversity: Protecting local flora and fauna across all our locations to ensure that we do not adversely impact biodiversity through our operations.

Prosperity:

• Innovation: Embracing technology and innovation by incorporating IoT, Blockchain, AI and Machine Learning to develop a portfolio of sustainable solutions that help reduce emissions and other negative impacts of climate change.

• Green solutions: Investing in Sustainability reporting solution (i.Sustain) and Climate Risk Management platforms, Smart grid, Microgrid-As-A-Service, Community Action Platform for Energy, Integrated Electric Vehicle Charging systems (IEVCS), Smart data hubs and Smart Cities for our Customers to reduce their carbon emissions.

• Connecting with customers: Embracing brand equity by connecting with our customers to address their current and future needs and ensuring customer satisfaction.

Partnership

• Learning and Sharing: Partnering with collaborators & partner companies to create an alliance ecosystem and supplement each other’s capabilities on joint projects. Collaborating with academia, businesses, NGOs, and governments to address some of the global challenges like health care, climate change, inequality, etc.

• Sustainable supply chain: Ensuring that we are in synch with our value chain in our commitment towards climate action and helping our suppliers follow the highest standards of sustainable and ethical best practices within their own organizations.

Tech Mahindra has drafted its Integrated Annual report in accordance with Global Reporting standards and frameworks with the data assured by a third party thus complying with the highest transparency standards.

The Company’s progress against the sustainability targets and metrics are disclosed in the externally assured Integrated reports available on the website of the company- https://www.techmahindra.com/en-in/ sustainability/

AWARDS AND RECOGNITION

Your Company continued its quest for excellence in its chosen area of business to emerge as a true global brand. Several awards and rankings continue to endorse your Company as a thought leader in the industry. A few of the prominent Awards / recognitions received by the Company during the Financial Year 2022-23 include:

• Tech Mahindra won several medals in the USA for its people practices- Brandon Hall HCM Excellence Awards, Stevie Awards for Great Employers and was also included in the 2023 Bloomberg Gender-Equality Index (GEI).

• Tech Mahindra Philippines was certified as a Great Place to Work.

• The Economic Times bestowed Tech Mahindra with several recognitions including Great Manager Awards (People Business), Human Capital Awards and ‘Best Organizations for Women’ (Femina).

• Tech Mahindra was also recognized by Avtar and Seramount as "Champions” in Most Inclusive Companies Index and "Top 10” in Best Companies for Women in India.

• Dun & Bradstreet India recognized Tech Mahindra as a top performer in the ESG Performance -Software and BPM sector.

• Tech Mahindra won Frost & Sullivan’s Technology Innovation Leadership Award 2022 for Metaverse Technology Services.

• Tech Mahindra was recognized among the Iconic brands at ET Iconic Brands 2022.

• TechM amplifAI0->^ is awarded "Cool Product or Service of the Year in Business 2022.” at the 12th Annual 2022 Business Excellence Awards by Globee® Business Awards.

• Tech Mahindra MEA was recognized for Ground-breaking products/services in Ecommerce at GITEX.

• Tech Mahindra was awarded ‘A’ rating in MSCI ESG ratings 2022.

• Tech Mahindra received the "Mahatma Award 2022 for Social Good & Impact - Decent Work and Economic Growth” for its SMART Program.

These awards are a reflection of the Company’s continued efforts in the fields of business, sustainability, human resource management and its sustained progress towards creating a better society for all.

ACKNOWLEDGEMENTS

Your directors place on records their appreciation for the contributions made by employees towards the success of your Company. Your directors gratefully acknowledge the co-operation and support received from the shareholders, customers, vendors, bankers, Regulatory and Governmental authorities in India and abroad.

For and on behalf of the Board

Anand G. Mahindra Place: Mumbai Chairman

Date: 15th June, 2023 (DIN: 00004695)

Note: The Board of Directors at its meeting held on April 27, 2023, had approved the financial statements for the financial year 2023 and the Director''s Report along with the Annexures. However, in view of the appointment of Mr. Mohit Joshi as Additional Director and Whole Time Director, the revised Director''s Report was approved by the Board at its Meeting held on June 15, 2023.

1

Interim Dividend (Special Dividend) for the Financial Year ended March 31, 2022 and Final Dividend for the Financial Year ended March 31, 2021


Mar 31, 2023

Your directors are pleased to present the Thirty Sixth Annual Report along with the audited accounts of your Company for the year ended March 31, 2023.

FINANCIAL RESULTS (STANDALONE)

('' in Million)

For the year ended March 31

2023

2022#

Income

437,856

372,079

Profit Before Interest, Depreciation and Tax

58,978

72,383

Interest

(1,808)

(689)

Depreciation

(8,129)

(7,403)

Profit Before Tax

49,041

64,291

Provision for Taxation

(11,266)

(14,058)

Profit After Tax

37,775

50,233

Other Comprehensive Income

(2,480)

1,200

Balance brought forward from previous year

216,090

203,329

Profit available for appropriation

253,917

253,292

Equity Dividends

(46,705)1

(43,624)1

Transfer to retained earnings on account of options lapsed

99

74

Transferred from Special Economic Zone re-investment reserve on utilization

7,151

6,348

Balance carried forward

214,462

216,090

# - Figures for the previous year are restated after considering the amalgamation of Tech Mahindra Business Services Limited and Born Commerce Private Limited with the Company.

1 Interim Dividend (Special Dividend) for the Financial Year ended March 31, 2023 and Final Dividend for the Financial Year ended March 31,2022

DIVIDEND

The Board of Directors on November 1, 2022 approved a special interim dividend of '' 18/- per share (i.e. 360%) on the par value of '' 5/- each which was paid by the Company to the shareholders whose names appeared in the Register of Members as on November 10, 2022, being the record date for the payment of dividend. Your Directors are pleased to recommend a final dividend of '' 32/- per share on par value of '' 5/- (i.e. 640%), payable to those Shareholders whose names appear in the Register of Members as on the Book Closure Date. Thus, the total dividend for the FY 2022-23 will be '' 50/- per share (i.e. 1000%) against the dividend of '' 45/- per share (i.e. 900%) paid for the Financial Year 2021-22.

The Board of your Company decided not to transfer any amount to the General Reserve for the year under review.

Your Company has formulated a Dividend Policy which is disclosed on the website of the Company and can be accessed at https://insights.techmahindra.com/ investors/tml-dividend-distribution-policy.pdf

SHARE CAPITAL

During the year under review, your Company allotted 2,313,996 equity shares on the exercise of stock options under various Employee Stock Option Schemes. Consequently, the issued, subscribed and paid-up equity share capital has increased from '' 4,859.17 million divided into 971,833,479 equity shares of '' 5/- each to '' 4,870.74 million divided into 974,147,475 equity shares of '' 5/- each.

ALTERATION OF ‘CAPITAL CLAUSE’ OF MEMORANDUM OF ASSOCIATION

Consequent to the merger of Tech Mahindra Business Services Limited and Born Commerce Private Limited with the Company, the Authorised Capital of the

Company increased from '' 8,336.50 million divided into 1,667,300,000 equity shares of '' 5/- each to '' 9,093 million divided into 1,818,600,000 equity shares of '' 5/- each.

Accordingly, the Capital Clause of the Memorandum of Association of the Company was altered and substituted with the new Clause V to reflect the corresponding changes in the Authorised Share Capital.

BUSINESS PERFORMANCE / FINANCIAL OVERVIEW

Imperative for businesses and your Company to stay relevant is the need to be cognizant of the tectonic shifts occurring around the world. Technological innovations, climate change and the need for inclusive growth and representation among others is defining the way organization’s function. Tech Mahindra has remained on the forefront of all cutting-edge technological advancements and harnessed many emerging technologies to transform customer and employee experiences. Your Company’s execution strategy is indexed to the pillars of client focus, portfolio synergy, operational rigor, new age technology bets and people transformation.

During the Financial Year ended on March 31, 2023, the Company’s revenues grew to '' 532,902 million on a consolidated basis as against '' 446,460 million in the previous year - indicating a robust growth of 19.4%. The growth was broad based across geographies as both Americas and Europe contributed in line with overall business growth. The Company also saw healthy growth across business segments in Communications, Media and Entertainment (CME) and Enterprise verticals.

The EBITDA on a consolidated basis for the Financial Year 2023 was '' 80,288 million, similar to the previous year’s EBITDA of '' 80,200 million. The resultant EBITDA margins were in the range of 15.1% in FY 2023 compared to 18.1% in FY 2022. The post-tax profit of the Company was reduced to '' 48,313 million in FY 2023 as against '' 55,661 million in FY 2022.

The Company saw robust demand for digital transformation services with a focus on customer experience and cloud. The Company has seen new deal wins close to USD 3,000 million during the year, indicating a healthy growth momentum across all business verticals. Your Company’s investments in Enterprise SaaS and Hi-tech capabilities will help

it cater to increasing modernization demands from businesses in the Financial Year 2024 and beyond.

MATERIAL CHANGES AND COMMITMENTS AFFECTING FINANCIAL POSITION BETWEEN THE END OF THE FINANCIAL YEAR AND THE DATE OF THE REPORT

There have been no material changes and commitments which affect the financial position of the Company that have occurred between the end of the financial year to which the financial statements relate and the date of this report.

ACQUISITIONS

Your company made the following acquisition during the FY 2022-23.

THIRDWARE SOLUTIONS LIMITED

The Company acquired 100% of the share capital of Thirdware Solutions Limited ("Thirdware”) on June 3, 2022 at a consideration up to USD 42 million including earnouts. Thirdware is a global player in Enterprise Applications and will enhance the Company’s digital solutions and services in automotive consultant and design, development and implementation in areas like ERP (Enterprise Resource Planning), EPM (Enterprise Performance Management), RPA (Robotic Process Automation) and IloT (Industrial Internet of Things). These capabilities will give the Company an edge in the manufacturing space.

UPDATE ON MERGER

Your directors at their meeting held on January 31, 2021 approved the Scheme of Merger of Tech Mahindra Business Services Limited (TMBSL) and Born Commerce Private Limited (Born) with the Company with the appointed date as April 1, 2021.

Hon’ble NCLT, Mumbai bench and Hon’ble NCLT, Chennai bench vide their order dated January 5, 2023 and January 12, 2023 respectively, approved the scheme of merger by absorption of the TMBSL and Born with the Company and their respective shareholders and the said Scheme has become effective on February 16, 2023.

SUBSIDIARIES, ASSOCIATES AND JOINT VENTURES OF THE COMPANY

The performance and financial position of the subsidiaries, associates, and joint venture companies included in the consolidated financial statement is provided in accordance with the provisions of Section

129 read with Rule 5 of the Companies (Accounts) Rules, 2014 containing the salient features of the financial statement of the Company’s subsidiaries/joint ventures or associate companies in Form AOC - 1 in “Annexure I” to this report.

Pursuant to Rule 8(5)(iv) of the Companies (Accounts) Rules, 2014, the names of the companies which have been incorporated or ceased to be the subsidiaries, joint ventures or associate companies during the year are provided in “Annexure II” to this report. The Company is actively pursuing the initiative on the consolidation of its subsidiaries/branches to optimize the operational costs. During the year under review, your Company has closed/merged twenty subsidiaries.

HUMAN RESOURCES

The employees of the Company are the most critical asset to your Company. The Company has taken several steps to protect, retain, and improve the competencies of these assets including:

Hiring: Forecast to Fulfilment

Your Company has streamlined its talent hiring process adopting some best-in-class practices. By building predictability in talent planning & forecasting for new age skills, your Company has been able to fuel business growth. Your Company has revamped its Buddy Referral programs to recruit talent from existing employee networks while offering attractive incentives. Embracing diversity in the hiring process has improved the global and local representation of talent within the organization. The Company has also redesigned its Candidate Engagement process to focus on creating positive experiences from the issuing joining offer letter to internal deployment to client projects. With rigor in talent allocation and proactive skilling of bench talent, your Company has been able to increase its internal fulfilment to 71% from 48% which is the best in the industry.

Learning: Skilling on the job

With the growth in digital business, your Company has been transforming its workforce both at speed and scale. The Company accelerated skilling initiatives to keep up with the pace of technological developments and built a ‘future-ready’ talent pool. #NAD Learn, the Al-based platform with interactive, on-demand, contextual and hyper-personalised up-skilling is helping the Company develop full-stack professionals. Your Company has supplemented this with young leadership development programs as well

as new policies to promote niche skilling and fast-track career growth. Employees can learn and grow as a Fresher through Elevate, in customer deployments through Project Skilling, for career progression through Future Skilling and into the leadership pipeline through journey-based programs. The Company also offers super-specialization skilling programs including Architect CoE, HiPOT programs at units and Program Manager CoE through EMBARK. Some new programs that the Company has recently launched for high-potential talent development include MALT and TrIBE.

Leadership: Integrative Thinking

The natural culture of empowerment that was supercharged during the pandemic continues to be the mainstay in the current hybrid work environment. Your Company aims to help employees imbibe mindsets & behaviors for the future which include a renewed focus on Integrative Thinking, Business & Financial Acumen, Bias for Action, Closure over Follow-up, Data over Emotions and Extreme Ownership. This was reinforced through the adoption of an industry leading learning platform - Harvard Manage Mentor Spark aimed at imparting best-in-class training at every level in realtime. Your Company has a robust Talent Management process for developing the leadership talent pipeline and has adopted consistent coaching practices for managers. Apart from Coaching, the employees have experienced new forms of learning with technology-enabled tools and pedagogies. For example, the ‘Wheel of Life’ is a customized self-coaching tool with gamified journeys, and personalized Habit Tracking making personal and professional well-being goals accessible to every employee.

Performance: Feedback focused

Your Company launched the Annual Performance Feedback cycle in December 2022. In order to build a culture where performance is enabled through feedback, Managers have been trained to have better performance review dialogues with their direct reports and work on an outcome-based evaluation rather than process or effort measurement. Your Company is creating a High-Performance Culture through hyper-personalized Incentive plans. Your Company has a suite of Incentive plans that are designed to create a strong alignment between Individual growth and Organization performance.

Wellness: Collective well-being

Your Company puts a happier, healthier and more productive workforce at the core of its business, policies and decisions. Your Company has designed

initiatives covering eight dimensions of wellness -Physical, Occupational, Emotional, Spiritual, Social, Environmental, Financial and Intellectual. The focus on preventative care with Corporate paid preventive health check, on-campus doctor consultations & counselling programs, helps employees diagnose any health condition in advance. To tackle IT industry specific issues, the Company organizes wellness sessions on Ergonomics, Healthy eating, Lifestyle management etc. Multiple tech-enabled wellness interventions like Kick the Butt (Smoking Cessation Program), Bend it like TechM (Guide to Ergonomics), Dump the Plump (Weight loss challenge) etc. have helped employees create healthier habits. Through the People Care program, managers are encouraged to show their human side and empower their team members to pursue collective well-being.

Communication: Building purpose

A robust communication process is at the heart of the Company’s vibrant culture. Employees are kept connected and informed through multiple media. Your Company’s 360-degree communication framework ensures employees have access to connect with leaders, peers and the external world. With publications, platforms, storytelling, campaigns, and connects, the organizational culture is shared with all. Your Company shares stories of diverse individuals achieving extraordinary things using structured formats like #RiseFromWithin. Leaders in the Company share not just business updates and success stories but personal anecdotes that reinforce the belief of a shared destiny.

Engagement: Hybrid connects

For an increasingly hybrid workplace, the Company has designed several virtual ‘water-cooler’ moments like All Hand Meets with CXO, Prime Time, Location Connects etc. along with family connects. Employees have platforms like MS Teams and Cisco WebEx for collaborative yet decentralized working. Your Company also organized on-ground engagement linked to TechM’s FIDE partnership for the Chess Olympiad. TechM CARES Action Planning workshops were also organized across different business units to implement changes based on employee feedback. Your Company also organized more than 1,200 engagement programs globally linked to Rise Refresh.

Rise Refresh: #TogetherWeRise

For more than a decade, the Rise philosophy has inspired employees from across the Mahindra Group to come to work and build something meaningful.

Since then, the world has changed with the rise of disruptive technologies, changing start-up ecosystem, climate change and recently, the pandemic. This is why, the Company has defined a new core purpose and brand pillars of Rise to simplify and sharpen its commitments. Your Company has leveraged every possible medium to ensure that this is communicated to all employees. From the conventional posters, communities, blogs, leader-bytes, microsite, quizzes and signatures route to the unconventional music, memes, WhatsApp stickers, GenZ lingo, podcast conversations and comic strips, Rise has touched the heart of every employee.

Diversity: Respecting Individuality

Your Company believes that respecting diversity and ensuring inclusion is fundamentally the right thing to do. It respects, embraces and celebrates the uniqueness of every individual. This also links back to the stated objective of the Company to be human-centered by encouraging associates to bring their most authentic selves to work. Your Company initiated the Maternity Assistance Program (MAP) to support employees who were on Maternity Leave in their transition back to work. The Company has also organized several Fireside chats featuring women with STEAM (Science, Technology, Engineering, Arts, Mathematics) roles to inspire others to grow in these fields. Through the ‘Restart’ Program, the Company aims to help Women IT Professionals restart their career after a break.

Recognition: Appreciation always

Your Company believes in appreciating, recognizing, and celebrating by building a culture where good work and behavior are appreciated. The Company has designed specialized recognition programs where rewards, tenure, performance, and contribution are celebrated, often with the loved ones of employees. The recognition program is centered around n = 1, that is, the individual at the heart of everything. A key part of personalizing recognition is to bring it to the desk of every employee. This is enabled by the KUDOS portal that offers recognition badges as well as redemption options for the points earned. Giving employees the ability to appreciate colleagues and sustained campaigns have led your Company to have an industry leading rewards penetration of ~74% including monetary and non-monetary recognition. Tenure is rewarded with personalized gifts for both the employee and their family members. Lastly, there are several organizational level awards for outstanding achievements like the ACE, STAR, Location Council and Spotlight awards.

HR Digitization: Experiencing technology

Your Company has revolutionized employee experience by deploying technology at different touchpoints of their lifecycle. Your Company continued its internal automation focus by using Robotic Process Automation for completing common workforce actions to reduce manual work. Your Company has also integrated HR Chatbot UVO and Technical Support Chatbot ATOM into MS Teams making it easier to perform workforce actions like leave applications, pending approvals, ticket registrations etc. Developing an "Attrition Prediction Model” has provided Your Company with an early warning system predicting the employees’ likelihood to quit, giving the Business HR team the ability to stage an intervention. The Company has also explored the use of Metaverse where three dimensional avatars interact in a virtual world to develop modules for hiring and on-boarding. Translating these experiences to mobile devices, the Company has developed ‘The Wheel of Life’ application as a self-coaching tool.

QUALITY

The Company continues its focus on quality and strives to exceed customer expectations at all times. During the year, it continued to strengthen the implementation of Quality systems and upgraded the processes/systems to comply with CMMI V 2.0 for both Development and Services and currently assessed for maturity level 5. Similarly it underwent various upgrade and re-certification audits for multiple standards during the year in order to meet client demands and enhance value delivery - successfully re-certified, ISO 9001:2015 (Quality Management System), ISO 20000-1:2018 (Information Technology Service Management System), ISO 27001:2013 (Information Security Management System), ISO 27701:2019 (Privacy Information Management System), TL9000 R 6.2/ R5.7 (Quality Management Systems for Tele Communications industry), ISO 13485:2016 (Quality Management Systems for medical devices - scope of certification limited to medical devices business within Tech Mahindra), AS9100 Rev D (Standard for Aerospace domain - scope of certification limited to the aerospace business within Tech Mahindra), ISO 17025:2017 - Laboratory Quality Management Systems for our device testing labs.

In addition to these, your Company also maintains its commitment to health, safety and environment by continually improving its processes in accordance with ISO 14001:2015 (Environmental Management System) and ISO 45001: 2018 (Occupational Health and Safety

Assessment Series) standards. Your Company is also certified on ISO 22301:2012 (Societal Security and Business Continuity Management System) and has a comprehensive Business Continuity and Disaster Recovery framework, to prevent potential business disruptions in the event of any disaster. It has processes that helped resume services to customer’s acceptable service levels. Automated Service Desk with SLAs for enabling business and Vulnerability Assessment and Penetration Testing Lab for secured corporate network operations are highlights that showcase the information security posture of the Organization.

Tech Mahindra (IT Division) has been assessed for the implementation of high maturity business excellence practices at Mahindra Group (Services Sector). It has been assessed at TMW Maturity Stage 7 (on scale of 1-10 stages) of Mahindra Business Excellence Framework - The Mahindra Way. These certifications are testimony of the robustness of business processes and at large, the quality culture imbibed in the organization.

Your Company has institutionalized the Deliverability Risk Assessment (DRA) practice - to assess the readiness and to identify risks at the beginning of the program, continued to strengthen the process for transforming Quality Assurance processes & delivery methods to adopt and strengthen Delivery excellence, Risk governance, and further enhance automation to enable quality delivery to the customer. Quality index which is a measure of quality of products and services delivery is institutionalized.

The Company is ensuring all these initiatives are in place, to ensure that it delivers as stated in its Quality Policy.

DIRECTORS

During the year under review, all Independent Directors have given declarations that they meet the criteria of Independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Independent Directors have also given declaration of compliance with Rules 6(1) and 6(2) of the Companies (Appointment and Qualification of Directors) Rules, 2014, with respect to their name appearing in the data bank of Independent Directors maintained by the Indian Institute of Corporate Affairs.

Pursuant to the provisions of Section 152(6)(c) of the Companies Act, 2013, Mr. Manoj Bhat, Director (DIN: 05205447) is liable to retire by rotation and being eligible offers himself for reappointment.

During the year under review, Ms. Penelope Fowler (DIN: 09591815) was appointed as Additional Director by the Board of Directors of the Company on May 13, 2022. She was further appointed as an Independent Director pursuant to the special resolution passed by the shareholders at the Annual General Meeting held on July 26, 2022 for a period of 5 years.

In view of the retirement of Mr. C. P Gurnani, Managing Director and CEO, the Board of Directors at its meeting held on June 15, 2023, based on the recommendation of the Nomination and Remuneration Committee approved the Appointment of Mr. Mohit Joshi, (DIN: 08339247) as Additional Director with effect from June 20, 2023 to hold office up to the date of ensuing Annual General Meeting. Further in order to ensure smooth transition into the role of Managing Director as Mr. C. P. Gurnani would retire on December 19, 2023, Mr. Mohit Joshi was also appointed as a Whole Time Director designated as Managing Director (Designate) and Key Managerial Personnel with effect from June 20, 2023 up to December 19, 2023 subject to the approval of the members of the Company and the Central Government.

The Board of Directors, based on the recommendation of Nomination and Remuneration Committee also approved the appointment of Mr. Mohit Joshi as Managing Director & Chief Executive Officer of the Company and Key Managerial Personnel under the Companies Act, 2013 from December 20, 2023 to June 19, 2028 (both days inclusive), subject to approval of the members of the Company and the Central Government.

The Board recommends the appointment of Mr. Manoj Bhat and Mr. Mohit Joshi to the Members at the ensuing Annual General Meeting. The brief profile of Mr. Manoj Bhat and Mr. Mohit Joshi is given in the Notice of the Annual General Meeting.

In terms of Regulation 24(1) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations 2015, Mr. T. N. Manoharan, Lead Independent Director of the Company has been appointed as Director on the Board of Tech Mahindra (Americas) Inc., a wholly

owned unlisted material subsidiary of the Company with effect from May 21, 2019.

In the opinion of the Board of Directors, the Independent Directors have relevant proficiency, expertise and experience.

FAMILIARISATION PROGRAMME

These programmes aim to provide insights into the Company to enable the Independent Directors to understand its business in depth and contribute significantly to the Company. The details of the program for familiarisation of the Independent Directors with the Company are available on its website and can be accessed at https://insights.techmahindra.com/ investors/tml-familarisation-progarmmes-for-IDs.pdf

The Board of Directors are regularly updated on changes in statutory provisions like amendments in Corporate Laws, SEBI Regulations, Taxation Laws and People related laws as applicable at the quarterly Board meetings. The Board members are also updated on the Risk universe applicable to the Company’s business. The MD & CEO of the Company had quarterly sessions with Board members sharing updates about the Company’s business strategy, operations and the key trends in the IT industry that are relevant to the Company. These updates help the Board members in keeping abreast of key changes and their impact on the Company. Further Subject Knowledge Experts from various fields are also invited to the meetings of the Board/Committees to appraise the Board Members of the latest developments in the IT and the business.

TRAINING

The Company has laid down a policy on the training of Independent Directors as part of its governance policies. The Senior Leadership of the Company periodically updates the Directors on regulatory changes, business strategy and operations.

BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and Regulation 19 read with Schedule II, Part D of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has devised a policy on evaluating the performance of the Board of Directors, the Chairman, Committees, and Individual Directors. The evaluation process was carried out through a web-based portal. The summary of the evaluation reports

was presented to the respective Committees and the Board. The Directors had given positive feedback on the overall functioning of the Committees and the Board. The suggestions made by the Directors in the evaluation process have been suitably incorporated in the processes.

NUMBER OF MEETINGS OF THE BOARD

The Board met five times during the Financial Year 2022-23. The meeting details are provided in the Corporate Governance report that forms part of this Annual Report. The maximum interval between any two meetings did not exceed 120 days as prescribed in the Companies Act, 2013 and SEBI Listing Regulations.

COMMITTEES OF THE BOARD

As on March 31, 2023, the Board has constituted seven Committees, namely, Audit Committee, Nomination and Remuneration Committee, Stakeholders Relationship Committee, Risk Management Committee, Corporate Social Responsibility Committee, Investment Committee and Securities Allotment Committee. The details of terms of reference of each Committee and the meetings held during the year are given in the Corporate Governance Report.

The Company has also formed Group Governance Council comprising of Board Members and Senior Management in terms of the SEBI Circular No. SEBI/ HO/CFD/CMD/CIR /P/2018/79 dated May 10, 2018, considering it has a large number of subsidiaries.

POLICY ON DIRECTORS’ APPOINTMENT AND REMUNERATION

The Governance policies laid down by the Board of Directors of your Company include:

i. Policy on the appointment and removal of Directors, Key Managerial Personnel and Senior Management.

ii. Policy on remuneration to the Directors, Key Managerial Personnel and Senior Management and other Employees.

The extract of these two policies is provided in "Annexure III”.

The policies are available on the website of the Company and can be accessed at https://insights. techmahindra.com/investors/Governance-Policies-including-remuneration-to-Directors-KMPS.pdf

SUCCESSION PLAN

In accordance with the principles of transparency and consistency, your Company has adopted governance policies for appointments, remuneration and evaluation of its Board of Directors, Key Managerial Personnel & Senior Management. In line with these Governance policies, the Company has established a formal Succession Planning Program for Key Managerial Personnel across the organization. The Board evaluates all such plans at a regular interval and institutes a formal program for filling any such critical position. The Board evaluates both internal and external candidates for such positions along with the recommendations of the management. The Company also has a leadership development program where it identifies high potential managers, and trains them to take up the positions of higher responsibility. The Company has identified the second line of leadership, which provides stability to the business in case of contingencies.

KEY MANAGERIAL PERSONNEL (KMP)

Pursuant to provisions of Section 203 of the Companies Act, 2013, Mr. C. P. Gurnani, Managing Director & Chief Executive Officer, Mr. Milind Kulkarni, Chief Financial Officer (up to May 31, 2022), Mr. Rohit Anand, Chief Financial Officer (w.e.f. June 1, 2022) and Mr. Anil Khatri, Company Secretary & Compliance Officer were the Key Managerial Personnel of the Company during the year under review.

DIRECTORS’ RESPONSIBILITY STATEMENT

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

i. in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

ii. they have, in the selection of the accounting policies, consulted the Statutory Auditors and these have been applied consistently and, reasonable and prudent judgments and estimates have been made so as to give a true and fair view of the state of affairs of the Company as at March 31, 2023 and of the profit of the Company for the year ended on that date;

iii. proper and sufficient care had been taken 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 other irregularities;

iv. the annual accounts have been prepared on a going concern basis;

v. they had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively;

vi. the proper systems to ensure compliance with the provisions of all applicable laws are in place and are adequate and operating effectively.

DETAILS WITH RESPECT TO ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS

The Company has internal financial controls which are adequate and were operating effectively. The controls are adequate for ensuring the orderly and efficient conduct of the business, including adherence to the Company’s policies, the safeguarding of assets, the prevention and detection of frauds and errors, the accuracy and completeness of accounting records and timely preparation of reliable financial information.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS / PROCEEDINGS

There are no significant and material orders passed by the regulators or courts or tribunal, impacting the going concern status and the Company’s operations in the future.

Further no application against the Company has been filed or is pending under the Insolvency and Bankruptcy Code, 2016, nor has the Company done any one-time settlement with any Bank or Financial institutions.

STATUTORY AUDITORS

The members, in the 35th Annual General Meeting (AGM) held on July 26, 2022, appointed M/s. B S R & Co. LLP, Chartered Accountants, [ICAI Firm’s Registration No. 101248W/W- 100022] as the Statutory Auditors of the Company, to hold office for a further term of five consecutive years from the conclusion of the 35th AGM of the Company held in

the Financial Year 2021-22 until the conclusion of the AGM of the Company for the Financial Year 2026-27 on such remuneration as may be determined by the Board of Directors.

There are no qualifications, reservations, adverse remarks or disclaimers made in the audit report for the Financial Year 2022-23.

SECRETARIAL AUDIT REPORT

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 had appointed Makarand Lele & Co., Practicing Company

Secretary, Pune to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is available at "Annexure IV” to this report. There are no qualifications, reservations, adverse remarks or disclaimers made in the Secretarial Audit Report.

COMPLIANCE WITH SECRETARIAL

STANDARDS

The Company has complied with the applicable Secretarial Standards.

ANNUAL RETURN

Pursuant to the provisions of Section 92(3) read with Section 134(3) (a) of the Companies Act, 2013, the Annual Return in Form MGT-7 is available on the website of the Company and can be accessed at https://insights.techmahindra.com/investors/mgt-7.pdf

INVESTOR EDUCATION AND PROTECTION FUND (IEPF)

During the year, the Company has transferred the unclaimed dividends of '' 2,13,40,674 to the Investor Education and Protection Fund. Further, 2,26,700 corresponding shares on which dividends were unclaimed for seven consecutive years were transferred to the fund as per the requirements of the IEPF Rules. The Members are requested to check the details of the unpaid dividend on the website of the Company and claim their dividend to avoid the shares from being transferred to IEPF.

MANAGERIAL REMUNERATION

Disclosures of the ratio of the remuneration of each director to the median employee’s remuneration and other details as required pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of

Managerial Personnel) Rules, 2014 as amended from time to time, are provided as "Annexure V”. None of the Directors or the Managing Director & CEO of the Company received any remuneration or commission from Subsidiary Companies of your Company.

The details of remuneration paid to the Directors including the Managing Director & CEO of the Company are provided in the Corporate Governance Report.

PARTICULARS OF EMPLOYEES

The information required under Section 197(12) of the Companies Act, 2013 ("the Act”) read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms part of this Report. However, pursuant to first proviso to Section 136(1) of the Act, this report is being sent to the Shareholders excluding the aforesaid information. Any shareholder interested in obtaining said information may write to the Company Secretary at the Registered Office / Corporate Office of the Company and the said information is open for inspection at the Registered Office of the Company.

POLICY ON PREVENTION OF SEXUAL HARASSMENT

Your Company has laid down the Prevention of Sexual Harassment (POSH) policy which is available on its website. The Company has zero tolerance on Sexual Harassment at workplace. During the year under review, there were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

The status of complaints received under POSH and redressed by the POSH Committee of the Company, during the Financial Year under review, are given below:

a) Number of complaints received during the year - 74

b) Number of complaints redressed during the year - 73@

c) Number of complaints pending for redressal as on March 31, 2023 - 3

@ - Includes 2 complaints received during the previous year and redressed during the year.

There are focused campaigns on the POSH policy within the Company and awareness drives that

take place. Furthermore, employees are required to undertake a mandatory certification on POSH to sensitize themselves and strengthen their awareness.

EMPLOYEE STOCK OPTION SCHEMES

During the year under review, there were no material changes in the Employee Stock Option Schemes (ESOPs) of the Company and the Schemes are in compliance with the SEBI Regulations on ESOPs.

As per Regulation 14 of Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021, the details of the ESOPs are uploaded on the website of the Company and can be accessed at https://insights.techmahindra. com/investors/details-of-esops-fy-2022-23.pdf

CORPORATE GOVERNANCE

A report on Corporate Governance covering among others composition of the Board of Directors, details of meetings of the Board and Committees along with a certificate for compliance with the conditions of Corporate Governance in accordance with the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, issued by the Statutory Auditors of the Company, forms part of this Annual Report.

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.

BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT (BRSR)

SEBI, vide its circular dated May 10, 2021, made BRSR mandatory for the top 1,000 listed companies (by market capitalization) with effect from the FY 2022-23. The Company voluntarily published BRSR for the Financial year 2021-22. The BRSR Report for the year 2022-23 is enclosed as part of this Annual Report.

In addition to the BRSR, the Integrated Annual Report of the Company provides an insight on the various ESG initiatives adopted by the Company. The ESG disclosures have been independently assured by KPMG.

COST RECORDS

Maintenance of cost records and requirement of cost audit as prescribed under the provisions of Section 148(1) of the Companies Act, 2013 are not applicable for the business activities of the Company.

RISK MANAGEMENT

The Risk Management Committee of the Board of Directors devised a Risk Management Policy and guides the operating management to identify risks, analyze their probability and impact and prepare mitigation plans. It periodically reviews the Risk Management Framework & Enterprise Risk Register which is presented by the Chief Risk Officer. The Company identifies all potential risks viz. economic, business, currency, operations, climate, governance, finance, cyber, business continuity etc. and prepares a mitigation plan for each of the risks. The elements of risk as identified by the Company with the impact and mitigation strategy are set out in the Management Discussion and Analysis Report.

ESTABLISHMENT OF VIGIL MECHANISM

The Company has laid down Whistle Blower Policy covering Vigil Mechanism with protective clauses for the Whistle Blowers. The Whistle Blower Policy is made available on the website of the Company.

DEPOSITS / LOANS & ADVANCES, GUARANTEES OR INVESTMENTS

The Company has not accepted any deposits from the public during the year under review. The particulars of loans/advances, guarantees and investments under Section 186 of the Companies Act, 2013 are given in the notes forming part of the Financial Statements.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All transactions entered with Related Parties as defined under Section 2(76) of the Companies Act, 2013 and Regulation 23 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, ("The Listing Regulations”), during the financial year under review were in the ordinary course of business and at an arm’s length pricing basis and do not attract the provisions of Section 188 of the Companies Act, 2013. There were no transactions with related parties in the Financial Year which conflicted with the interest of the Company and required compliance of the provisions of Regulation 23 of the Listing Regulations.

Suitable disclosure as required by the Indian Accounting Standards (Ind AS 24) has been made in the notes forming part of the Financial Statements.

The Company has formulated a policy on the Related Party Transactions and dealing with Related Party Transactions which has been uploaded on the website of the Company and can be accessed at https:// insights.techmahindra.com/investors/Related-Party-Transactions-Policy.pdf

The particulars of related party transactions in prescribed Form AOC - 2 are attached as ‘Annexure VI”. Pursuant to Regulation 23(9) of the Listing Regulations, your Company has filed half yearly report on Related Party Transactions with the stock exchanges.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars as prescribed under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 are provided in "Annexure VII” which forms part of this report.

CORPORATE SOCIAL RESPONSIBILITY

The CSR vision of the Company is "Empowerment through Education.”

In compliance with the guidelines prescribed under Section 135 of the Companies Act, 2013, your Company has constituted a Corporate Social Responsibility (CSR) Committee of the Board. The CSR policy, covering the Objectives, Focus Areas, Governance Structure Monitoring and Reporting Framework among others is approved by the Board of Directors. In accordance with the amendments made in Section 135 in January 2021, the CSR Policy has been duly revised and is available on the website of the Company and can be accessed at https://insights. techmahindra.com/investors/tml-csr-policy-23.pdf

The Company has spent more than 2% of the average net profits of the Company during the three immediately preceding Financial Years on CSR.

The Company’s social initiatives are mainly carried out by Tech Mahindra Foundation and Mahindra Educational Institutions, Section 8 (erstwhile Section 25) Companies promoted by the Company.

TECH MAHINDRA FOUNDATION (TMF) EDUCATION

The key initiatives taken by TMF in the arena of school education include:

ALL ROUND IMPROVEMENT IN SCHOOL EDUCATION (ARISE)

Tech Mahindra Foundation’s educational initiatives under ARISE are long-term school improvement programmes, in partnership with local governments and partner organisations. The Foundation in 2022-23 worked with 18 government primary & secondary schools to transform them into model schools of excellence. A total of 5,224 students were positively impacted under this programme, of which 2,832 were girls.

During the year, the Foundation expanded its work for children with special needs through its ARISE programme. This programme is a variant of ARISE in which children with special needs are provided chronic therapy as well as special education to help them lead more fulfilling lives. Through 32 projects, the programme enabled 4,829 children with special needs to become better learners with greater independence in managing their lives. The Foundation has taken up the provision of assistive technology for these children as an important value addition to its work in ARISE .

SHIKSHAANTAR

Shikshaantar, envisioned as a programme for enhancing the capacity of government school teachers, has emerged as an important programme in the education portfolio of the Foundation. TMF works with the Municipal Corporation of Delhi by running their In-Service Teacher Education Institutes. With the merger of the MCDs, TMF now has the responsibility of training teachers from close to 1,500 primary schools in Delhi. During the year under review, as many as 4,379 teachers were trained as part of Shikshaantar. This included specially designed modules for Digital Literacy, Child Safety, Cyber Security and Mental Health that were delivered to the teachers in a hybrid mode.

MOBILE SCIENCE LAB & ROBOTICS LAB

In order to increase the footprint of its work in Education and reach the unreached, TMF launched a unique initiative in 2019-20 - The Mobile Science Lab (MSL). For this, a Mahindra bus has been remodeled to become a science lab on wheels and has been travelling from school to school in East Delhi to provide STEM learning for children in grades 3 and 4 in these

schools. The MSL program benefitted as many as 6,861 students and 77 teachers throughout the year.

Following the success of the MSL program, TMF has also set up a Robotics Lab at one of its ARISE schools in Delhi which is an all-girls school. This lab was inaugurated in November 2022, and nearly 300 girls from this school are the potential beneficiaries.

EMPLOYABILITY

Skills-for-Market Training (SMART) is the Foundation’s flagship programme in employability. It is built on the vision of an educated, enabled and empowered India, and the belief that educated and skilled youth are the country’s true strength. The programme started with 3 Centres in 2012 and is currently running over 85 Centres at 10 locations across India. These include SMART Centres, SMART Centres (training for people with disabilities), and SMART-T Centres (training in technical trades).

In 2022-23, your Company trained 17,641 young women and men under its SMART program, of which, 1,303 were persons with disabilities. More than 70% of the graduates are placed in jobs across multiple industries upon successful completion of the training. The average salaries being earned by the graduates of the SMART program have been steadily rising and saw a 10% jump over the previous year.

The Foundation’s commitment to setting new benchmarks in skill development in India has been underscored by the setting up of Tech Mahindra SMART Academies, which provide the highest quality of skill training to youngsters in Healthcare and Digital Technologies. During FY 2022-23, 3,584 students were trained at the nine Academies that are now functional - 5 in Healthcare, 3 in Digital Technologies, and 1 in Logistics.

TMF’S OUTREACH INITIATIVES

In addition to all the core programs described above, Tech Mahindra Foundation is now also implementing several outreach projects in collaboration with various agencies. As part of these, the TMF team members are engaged in activities such as community health initiatives, teacher training, provision of content for other large-scale projects, etc. As part of such outreach projects, TMF supported 20,734 beneficiaries, taking the total tally of direct beneficiaries for the year to 61,995. This is nearly 50% more than the number of direct beneficiaries for FY 2021-22, which stood at 41,374.

MAHINDRA EDUCATIONAL INSTITUTIONS (MEI)

MEI - a not-for-profit, 100% subsidiary of the Company has set up Mahindra Ecole Centrale in August 2014 - through a collaborative venture between Mahindra Educational Institutions and Ecole Centrale of Paris, France (now known as Centrale Supelec) and the JNTU Hyderabad - to offer undergraduate engineering programs. Through this strong Indo-French Collaboration with Centrale Supelec and Industry connect with Tech Mahindra, MEC has emerged as a disruptive player in the field of Technical Education.

MEI has sponsored the setting up of Mahindra University to introduce diverse streams of education in addition to Engineering. Further the Engineering stream is being transitioned to Mahindra University.

MAHINDRA UNIVERSITY (MU)

Mahindra University ("MU”) (sponsored by Mahindra Educational Institutions, ("MEI”) - a not-for-profit, 100% subsidiary of Tech Mahindra), was notified on May 20, 2020 by the Government of Telangana vide The Telangana State Private Universities (Establishment and Regulation) Act, 2018 for "educating future citizens for and of a better world”.

The Ecole Centrale School of Engineering (ECSoE) currently runs various UG, PG and Ph.D. programs in cutting-edge engineering departments. ECSoE also launched a Centre for Life Sciences and offers courses in biotechnology and computational biology under it. The school plans to launch the 2.5 year integrated programs in Biotechnology & CSE for AY 2023-24.

Cornell University’s SC Johnson College of Business, an ivy league institution is the "Academic Partner” for School of Management. Mahindra University’s School of Management (MU - SoM) will benefit significantly from Cornell University’s expertise in curriculum development, faculty exchange programs including some specialty courses delivery by the Cornell faculty to Mahindra University students, as well as student immersion at Cornell. The School of Management currently conducts BBA, BA, E-MBA, and MBA (starting in 2023) programs.

The School of Law, Mahindra University, commenced operations in September 2021 in Hyderabad offering 5-year integrated programs in BA LL.B and BBA LL.B. It was founded on the philosophy of securing justice, equality, and service to all sections of society. With the needs of modern society evolving rapidly, there is a renewed focus on the importance of the discipline of

law. The School of Law will aim to make a difference to the legal profession and practice by providing a diverse, flexible curriculum and pedagogy, touching on several aspects of domestic and international law, while appraising the students of the latest trends in academia and practice. Starting 2022, the School of Law has launched a 3-year LLB (Hons) program and intend to launch a 6-year integrated B.Tech LLB course starting Academic Year 2023.

The University also plans to launch the following programs/schools for the Academic Year 2023-24:

1. School of Media

a. 4-year B.Tech. (Computation & Media)

b. 3-year BA (Digital Media & Communication)

2. School of Hotel Management

a. 3-year B.Sc. (Hospitality & Hotel Administration)

In the academic year 2022, a total of 2,971 students were studying under various programs across all schools and departments. The new admissions for academic year 2022 are 1,236 students of which 1,128 students are in various UG programs, including School of Management and School of Law, 22 students in the PG programs of School of Engineering and 86 students in the Ph.D programs across all the schools.

The Annual Report on CSR activities is provided as "Annexure VIII”.

SUSTAINABILITY

Your Company aligns closely with the Mahindra Group’s ambition to Rise: Be People positive, Planet positive, and Trust positive. The Company holistically embraces ever greater responsibility towards protecting the environment, empowering the society, and providing good governance.

Your Company’s strategy for creating long-term sustainable value is by improving, scaling, and transparently communicating our ecological, social, and economic impacts. Our strong governance framework led by the Board of Directors of your Company, who have oversight of the Company’s overall strategy and future direction and ensures the planning and implementation of environmental and social programs.

The Company’s holistic approach enables to drive sustainable impact in alignment with leading global frameworks, initiatives, and agendas committed to furthering sustainability such as the TCFD, SASB, GRI, as well as the Paris Agreement, the UNGC and the UN SDGs.

As a business, the Company recognizes the value of following the UN SDGs (Sustainable Development Goals) of People, Planet, Prosperity, and Partnership and continues to create value through initiatives that cater directly to these aspects of our performance.

People:

• Great place to work: Working to enhance our organizational culture by enabling our associates with access to advanced technologies, providing Learning & Development opportunities to help develop their skills and areas of expertise and providing them with robust career development programmes.

• Work-life balance: Providing feasible and flexible work-life balance and integration along with a range of associate-friendly policies and processes to reduce attrition.

• Diversity and inclusion: Ensuring that our organization continues to transcend into the realms of gender diversity and includes people with disabilities as well as people from the LGBTQIA community as part of being a socially responsible business.

• Employee engagement & recognition:

Ensuring our associates are engaged, feel valued, and recognized through a robust performance management system, a flexible system of working, and an extensive system of benefits and perquisites.

• Individual Social Responsibility: Encouraging associates to contribute to the society & environment and make these activities an integral part of their day-to-day activities.

Planet:

• Carbon neutrality and Net zero: Committing to carbon neutrality (2030) and Net zero (2035) by switching to renewable energy through on site installations and open access; improving energy efficiency through installation of LEDs, sensors; boosting green investments by

implementing Carbon Price; optimizing business travel by enabling virtual meetings; encouraging use of public transport and carpooling to reduce employee commute emissions; carbon sequestration through tree plantation; moving towards a low carbon economy by optimizing operations to ensure environmental protection.

• No waste to landfill: Installing Organic Waste Converters and vermicomposting plants at own campuses to convert food waste to manure, cutting down their transportation emissions and reducing waste to landfill.

• No to plastic: Maintaining plastic-free campuses and encouraging all stakeholders to use ecofriendly and biodegradable materials. Spreading awareness and initiating campaigns on preventing single-use plastic.

• Reduce, Reuse, Recycle, Recover: Implementing the process of Reduce, Reuse, Recycle and Recover across the value chain to limit waste and enable a circular economy.

• Being water positive: Improving water efficiency and increasing water savings by using water sensors, restrictors and water-efficient coolers, recycling wastewater through STPs, and recharging groundwater levels with Rainwater Harvesting Pits.

• Promoting Biodiversity: Protecting local flora and fauna across all our locations to ensure that we do not adversely impact biodiversity through our operations.

Prosperity:

• Innovation: Embracing technology and innovation by incorporating IoT, Blockchain, AI and Machine Learning to develop a portfolio of sustainable solutions that help reduce emissions and other negative impacts of climate change.

• Green solutions: Investing in Sustainability reporting solution (i.Sustain) and Climate Risk Management platforms, Smart grid, Microgrid-As-A-Service, Community Action Platform for Energy, Integrated Electric Vehicle Charging systems (IEVCS), Smart data hubs and Smart Cities for our Customers to reduce their carbon emissions.

• Connecting with customers: Embracing brand equity by connecting with our customers to address their current and future needs and ensuring customer satisfaction.

Partnership

• Learning and Sharing: Partnering with collaborators & partner companies to create an alliance ecosystem and supplement each other’s capabilities on joint projects. Collaborating with academia, businesses, NGOs, and governments to address some of the global challenges like health care, climate change, inequality, etc.

• Sustainable supply chain: Ensuring that we are in synch with our value chain in our commitment towards climate action and helping our suppliers follow the highest standards of sustainable and ethical best practices within their own organizations.

Tech Mahindra has drafted its Integrated Annual report in accordance with Global Reporting standards and frameworks with the data assured by a third party thus complying with the highest transparency standards.

The Company’s progress against the sustainability targets and metrics are disclosed in the externally assured Integrated reports available on the website of the company- https://www.techmahindra.com/en-in/ sustainability/

AWARDS AND RECOGNITION

Your Company continued its quest for excellence in its chosen area of business to emerge as a true global brand. Several awards and rankings continue to endorse your Company as a thought leader in the industry. A few of the prominent Awards / recognitions received by the Company during the Financial Year 2022-23 include:

• Tech Mahindra won several medals in the USA for its people practices- Brandon Hall HCM Excellence Awards, Stevie Awards for Great Employers and was also included in the 2023 Bloomberg Gender-Equality Index (GEI).

• Tech Mahindra Philippines was certified as a Great Place to Work.

• The Economic Times bestowed Tech Mahindra with several recognitions including Great Manager Awards (People Business), Human Capital Awards and ‘Best Organizations for Women’ (Femina).

• Tech Mahindra was also recognized by Avtar and Seramount as "Champions” in Most Inclusive Companies Index and "Top 10” in Best Companies for Women in India.

• Dun & Bradstreet India recognized Tech Mahindra as a top performer in the ESG Performance -Software and BPM sector.

• Tech Mahindra won Frost & Sullivan’s Technology Innovation Leadership Award 2022 for Metaverse Technology Services.

• Tech Mahindra was recognized among the Iconic brands at ET Iconic Brands 2022.

• TechM amplifAI0->^ is awarded "Cool Product or Service of the Year in Business 2022.” at the 12th Annual 2022 Business Excellence Awards by Globee® Business Awards.

• Tech Mahindra MEA was recognized for Ground-breaking products/services in Ecommerce at GITEX.

• Tech Mahindra was awarded ‘A’ rating in MSCI ESG ratings 2022.

• Tech Mahindra received the "Mahatma Award 2022 for Social Good & Impact - Decent Work and Economic Growth” for its SMART Program.

These awards are a reflection of the Company’s continued efforts in the fields of business, sustainability, human resource management and its sustained progress towards creating a better society for all.

ACKNOWLEDGEMENTS

Your directors place on records their appreciation for the contributions made by employees towards the success of your Company. Your directors gratefully acknowledge the co-operation and support received from the shareholders, customers, vendors, bankers, Regulatory and Governmental authorities in India and abroad.

For and on behalf of the Board

Anand G. Mahindra Place: Mumbai Chairman

Date: 15th June, 2023 (DIN: 00004695)

Note: The Board of Directors at its meeting held on April 27, 2023, had approved the financial statements for the financial year 2023 and the Director''s Report along with the Annexures. However, in view of the appointment of Mr. Mohit Joshi as Additional Director and Whole Time Director, the revised Director''s Report was approved by the Board at its Meeting held on June 15, 2023.

1

Interim Dividend (Special Dividend) for the Financial Year ended March 31, 2022 and Final Dividend for the Financial Year ended March 31, 2021


Mar 31, 2023

Your directors are pleased to present the Thirty Sixth Annual Report along with the audited accounts of your Company for the year ended March 31, 2023.

FINANCIAL RESULTS (STANDALONE)

('' in Million)

For the year ended March 31

2023

2022#

Income

437,856

372,079

Profit Before Interest, Depreciation and Tax

58,978

72,383

Interest

(1,808)

(689)

Depreciation

(8,129)

(7,403)

Profit Before Tax

49,041

64,291

Provision for Taxation

(11,266)

(14,058)

Profit After Tax

37,775

50,233

Other Comprehensive Income

(2,480)

1,200

Balance brought forward from previous year

216,090

203,329

Profit available for appropriation

253,917

253,292

Equity Dividends

(46,705)1

(43,624)1

Transfer to retained earnings on account of options lapsed

99

74

Transferred from Special Economic Zone re-investment reserve on utilization

7,151

6,348

Balance carried forward

214,462

216,090

# - Figures for the previous year are restated after considering the amalgamation of Tech Mahindra Business Services Limited and Born Commerce Private Limited with the Company.

1 Interim Dividend (Special Dividend) for the Financial Year ended March 31, 2023 and Final Dividend for the Financial Year ended March 31,2022

DIVIDEND

The Board of Directors on November 1, 2022 approved a special interim dividend of '' 18/- per share (i.e. 360%) on the par value of '' 5/- each which was paid by the Company to the shareholders whose names appeared in the Register of Members as on November 10, 2022, being the record date for the payment of dividend. Your Directors are pleased to recommend a final dividend of '' 32/- per share on par value of '' 5/- (i.e. 640%), payable to those Shareholders whose names appear in the Register of Members as on the Book Closure Date. Thus, the total dividend for the FY 2022-23 will be '' 50/- per share (i.e. 1000%) against the dividend of '' 45/- per share (i.e. 900%) paid for the Financial Year 2021-22.

The Board of your Company decided not to transfer any amount to the General Reserve for the year under review.

Your Company has formulated a Dividend Policy which is disclosed on the website of the Company and can be accessed at https://insights.techmahindra.com/ investors/tml-dividend-distribution-policy.pdf

SHARE CAPITAL

During the year under review, your Company allotted 2,313,996 equity shares on the exercise of stock options under various Employee Stock Option Schemes. Consequently, the issued, subscribed and paid-up equity share capital has increased from '' 4,859.17 million divided into 971,833,479 equity shares of '' 5/- each to '' 4,870.74 million divided into 974,147,475 equity shares of '' 5/- each.

ALTERATION OF ‘CAPITAL CLAUSE’ OF MEMORANDUM OF ASSOCIATION

Consequent to the merger of Tech Mahindra Business Services Limited and Born Commerce Private Limited with the Company, the Authorised Capital of the

Company increased from '' 8,336.50 million divided into 1,667,300,000 equity shares of '' 5/- each to '' 9,093 million divided into 1,818,600,000 equity shares of '' 5/- each.

Accordingly, the Capital Clause of the Memorandum of Association of the Company was altered and substituted with the new Clause V to reflect the corresponding changes in the Authorised Share Capital.

BUSINESS PERFORMANCE / FINANCIAL OVERVIEW

Imperative for businesses and your Company to stay relevant is the need to be cognizant of the tectonic shifts occurring around the world. Technological innovations, climate change and the need for inclusive growth and representation among others is defining the way organization’s function. Tech Mahindra has remained on the forefront of all cutting-edge technological advancements and harnessed many emerging technologies to transform customer and employee experiences. Your Company’s execution strategy is indexed to the pillars of client focus, portfolio synergy, operational rigor, new age technology bets and people transformation.

During the Financial Year ended on March 31, 2023, the Company’s revenues grew to '' 532,902 million on a consolidated basis as against '' 446,460 million in the previous year - indicating a robust growth of 19.4%. The growth was broad based across geographies as both Americas and Europe contributed in line with overall business growth. The Company also saw healthy growth across business segments in Communications, Media and Entertainment (CME) and Enterprise verticals.

The EBITDA on a consolidated basis for the Financial Year 2023 was '' 80,288 million, similar to the previous year’s EBITDA of '' 80,200 million. The resultant EBITDA margins were in the range of 15.1% in FY 2023 compared to 18.1% in FY 2022. The post-tax profit of the Company was reduced to '' 48,313 million in FY 2023 as against '' 55,661 million in FY 2022.

The Company saw robust demand for digital transformation services with a focus on customer experience and cloud. The Company has seen new deal wins close to USD 3,000 million during the year, indicating a healthy growth momentum across all business verticals. Your Company’s investments in Enterprise SaaS and Hi-tech capabilities will help

it cater to increasing modernization demands from businesses in the Financial Year 2024 and beyond.

MATERIAL CHANGES AND COMMITMENTS AFFECTING FINANCIAL POSITION BETWEEN THE END OF THE FINANCIAL YEAR AND THE DATE OF THE REPORT

There have been no material changes and commitments which affect the financial position of the Company that have occurred between the end of the financial year to which the financial statements relate and the date of this report.

ACQUISITIONS

Your company made the following acquisition during the FY 2022-23.

THIRDWARE SOLUTIONS LIMITED

The Company acquired 100% of the share capital of Thirdware Solutions Limited ("Thirdware”) on June 3, 2022 at a consideration up to USD 42 million including earnouts. Thirdware is a global player in Enterprise Applications and will enhance the Company’s digital solutions and services in automotive consultant and design, development and implementation in areas like ERP (Enterprise Resource Planning), EPM (Enterprise Performance Management), RPA (Robotic Process Automation) and IloT (Industrial Internet of Things). These capabilities will give the Company an edge in the manufacturing space.

UPDATE ON MERGER

Your directors at their meeting held on January 31, 2021 approved the Scheme of Merger of Tech Mahindra Business Services Limited (TMBSL) and Born Commerce Private Limited (Born) with the Company with the appointed date as April 1, 2021.

Hon’ble NCLT, Mumbai bench and Hon’ble NCLT, Chennai bench vide their order dated January 5, 2023 and January 12, 2023 respectively, approved the scheme of merger by absorption of the TMBSL and Born with the Company and their respective shareholders and the said Scheme has become effective on February 16, 2023.

SUBSIDIARIES, ASSOCIATES AND JOINT VENTURES OF THE COMPANY

The performance and financial position of the subsidiaries, associates, and joint venture companies included in the consolidated financial statement is provided in accordance with the provisions of Section

129 read with Rule 5 of the Companies (Accounts) Rules, 2014 containing the salient features of the financial statement of the Company’s subsidiaries/joint ventures or associate companies in Form AOC - 1 in “Annexure I” to this report.

Pursuant to Rule 8(5)(iv) of the Companies (Accounts) Rules, 2014, the names of the companies which have been incorporated or ceased to be the subsidiaries, joint ventures or associate companies during the year are provided in “Annexure II” to this report. The Company is actively pursuing the initiative on the consolidation of its subsidiaries/branches to optimize the operational costs. During the year under review, your Company has closed/merged twenty subsidiaries.

HUMAN RESOURCES

The employees of the Company are the most critical asset to your Company. The Company has taken several steps to protect, retain, and improve the competencies of these assets including:

Hiring: Forecast to Fulfilment

Your Company has streamlined its talent hiring process adopting some best-in-class practices. By building predictability in talent planning & forecasting for new age skills, your Company has been able to fuel business growth. Your Company has revamped its Buddy Referral programs to recruit talent from existing employee networks while offering attractive incentives. Embracing diversity in the hiring process has improved the global and local representation of talent within the organization. The Company has also redesigned its Candidate Engagement process to focus on creating positive experiences from the issuing joining offer letter to internal deployment to client projects. With rigor in talent allocation and proactive skilling of bench talent, your Company has been able to increase its internal fulfilment to 71% from 48% which is the best in the industry.

Learning: Skilling on the job

With the growth in digital business, your Company has been transforming its workforce both at speed and scale. The Company accelerated skilling initiatives to keep up with the pace of technological developments and built a ‘future-ready’ talent pool. #NAD Learn, the Al-based platform with interactive, on-demand, contextual and hyper-personalised up-skilling is helping the Company develop full-stack professionals. Your Company has supplemented this with young leadership development programs as well

as new policies to promote niche skilling and fast-track career growth. Employees can learn and grow as a Fresher through Elevate, in customer deployments through Project Skilling, for career progression through Future Skilling and into the leadership pipeline through journey-based programs. The Company also offers super-specialization skilling programs including Architect CoE, HiPOT programs at units and Program Manager CoE through EMBARK. Some new programs that the Company has recently launched for high-potential talent development include MALT and TrIBE.

Leadership: Integrative Thinking

The natural culture of empowerment that was supercharged during the pandemic continues to be the mainstay in the current hybrid work environment. Your Company aims to help employees imbibe mindsets & behaviors for the future which include a renewed focus on Integrative Thinking, Business & Financial Acumen, Bias for Action, Closure over Follow-up, Data over Emotions and Extreme Ownership. This was reinforced through the adoption of an industry leading learning platform - Harvard Manage Mentor Spark aimed at imparting best-in-class training at every level in realtime. Your Company has a robust Talent Management process for developing the leadership talent pipeline and has adopted consistent coaching practices for managers. Apart from Coaching, the employees have experienced new forms of learning with technology-enabled tools and pedagogies. For example, the ‘Wheel of Life’ is a customized self-coaching tool with gamified journeys, and personalized Habit Tracking making personal and professional well-being goals accessible to every employee.

Performance: Feedback focused

Your Company launched the Annual Performance Feedback cycle in December 2022. In order to build a culture where performance is enabled through feedback, Managers have been trained to have better performance review dialogues with their direct reports and work on an outcome-based evaluation rather than process or effort measurement. Your Company is creating a High-Performance Culture through hyper-personalized Incentive plans. Your Company has a suite of Incentive plans that are designed to create a strong alignment between Individual growth and Organization performance.

Wellness: Collective well-being

Your Company puts a happier, healthier and more productive workforce at the core of its business, policies and decisions. Your Company has designed

initiatives covering eight dimensions of wellness -Physical, Occupational, Emotional, Spiritual, Social, Environmental, Financial and Intellectual. The focus on preventative care with Corporate paid preventive health check, on-campus doctor consultations & counselling programs, helps employees diagnose any health condition in advance. To tackle IT industry specific issues, the Company organizes wellness sessions on Ergonomics, Healthy eating, Lifestyle management etc. Multiple tech-enabled wellness interventions like Kick the Butt (Smoking Cessation Program), Bend it like TechM (Guide to Ergonomics), Dump the Plump (Weight loss challenge) etc. have helped employees create healthier habits. Through the People Care program, managers are encouraged to show their human side and empower their team members to pursue collective well-being.

Communication: Building purpose

A robust communication process is at the heart of the Company’s vibrant culture. Employees are kept connected and informed through multiple media. Your Company’s 360-degree communication framework ensures employees have access to connect with leaders, peers and the external world. With publications, platforms, storytelling, campaigns, and connects, the organizational culture is shared with all. Your Company shares stories of diverse individuals achieving extraordinary things using structured formats like #RiseFromWithin. Leaders in the Company share not just business updates and success stories but personal anecdotes that reinforce the belief of a shared destiny.

Engagement: Hybrid connects

For an increasingly hybrid workplace, the Company has designed several virtual ‘water-cooler’ moments like All Hand Meets with CXO, Prime Time, Location Connects etc. along with family connects. Employees have platforms like MS Teams and Cisco WebEx for collaborative yet decentralized working. Your Company also organized on-ground engagement linked to TechM’s FIDE partnership for the Chess Olympiad. TechM CARES Action Planning workshops were also organized across different business units to implement changes based on employee feedback. Your Company also organized more than 1,200 engagement programs globally linked to Rise Refresh.

Rise Refresh: #TogetherWeRise

For more than a decade, the Rise philosophy has inspired employees from across the Mahindra Group to come to work and build something meaningful.

Since then, the world has changed with the rise of disruptive technologies, changing start-up ecosystem, climate change and recently, the pandemic. This is why, the Company has defined a new core purpose and brand pillars of Rise to simplify and sharpen its commitments. Your Company has leveraged every possible medium to ensure that this is communicated to all employees. From the conventional posters, communities, blogs, leader-bytes, microsite, quizzes and signatures route to the unconventional music, memes, WhatsApp stickers, GenZ lingo, podcast conversations and comic strips, Rise has touched the heart of every employee.

Diversity: Respecting Individuality

Your Company believes that respecting diversity and ensuring inclusion is fundamentally the right thing to do. It respects, embraces and celebrates the uniqueness of every individual. This also links back to the stated objective of the Company to be human-centered by encouraging associates to bring their most authentic selves to work. Your Company initiated the Maternity Assistance Program (MAP) to support employees who were on Maternity Leave in their transition back to work. The Company has also organized several Fireside chats featuring women with STEAM (Science, Technology, Engineering, Arts, Mathematics) roles to inspire others to grow in these fields. Through the ‘Restart’ Program, the Company aims to help Women IT Professionals restart their career after a break.

Recognition: Appreciation always

Your Company believes in appreciating, recognizing, and celebrating by building a culture where good work and behavior are appreciated. The Company has designed specialized recognition programs where rewards, tenure, performance, and contribution are celebrated, often with the loved ones of employees. The recognition program is centered around n = 1, that is, the individual at the heart of everything. A key part of personalizing recognition is to bring it to the desk of every employee. This is enabled by the KUDOS portal that offers recognition badges as well as redemption options for the points earned. Giving employees the ability to appreciate colleagues and sustained campaigns have led your Company to have an industry leading rewards penetration of ~74% including monetary and non-monetary recognition. Tenure is rewarded with personalized gifts for both the employee and their family members. Lastly, there are several organizational level awards for outstanding achievements like the ACE, STAR, Location Council and Spotlight awards.

HR Digitization: Experiencing technology

Your Company has revolutionized employee experience by deploying technology at different touchpoints of their lifecycle. Your Company continued its internal automation focus by using Robotic Process Automation for completing common workforce actions to reduce manual work. Your Company has also integrated HR Chatbot UVO and Technical Support Chatbot ATOM into MS Teams making it easier to perform workforce actions like leave applications, pending approvals, ticket registrations etc. Developing an "Attrition Prediction Model” has provided Your Company with an early warning system predicting the employees’ likelihood to quit, giving the Business HR team the ability to stage an intervention. The Company has also explored the use of Metaverse where three dimensional avatars interact in a virtual world to develop modules for hiring and on-boarding. Translating these experiences to mobile devices, the Company has developed ‘The Wheel of Life’ application as a self-coaching tool.

QUALITY

The Company continues its focus on quality and strives to exceed customer expectations at all times. During the year, it continued to strengthen the implementation of Quality systems and upgraded the processes/systems to comply with CMMI V 2.0 for both Development and Services and currently assessed for maturity level 5. Similarly it underwent various upgrade and re-certification audits for multiple standards during the year in order to meet client demands and enhance value delivery - successfully re-certified, ISO 9001:2015 (Quality Management System), ISO 20000-1:2018 (Information Technology Service Management System), ISO 27001:2013 (Information Security Management System), ISO 27701:2019 (Privacy Information Management System), TL9000 R 6.2/ R5.7 (Quality Management Systems for Tele Communications industry), ISO 13485:2016 (Quality Management Systems for medical devices - scope of certification limited to medical devices business within Tech Mahindra), AS9100 Rev D (Standard for Aerospace domain - scope of certification limited to the aerospace business within Tech Mahindra), ISO 17025:2017 - Laboratory Quality Management Systems for our device testing labs.

In addition to these, your Company also maintains its commitment to health, safety and environment by continually improving its processes in accordance with ISO 14001:2015 (Environmental Management System) and ISO 45001: 2018 (Occupational Health and Safety

Assessment Series) standards. Your Company is also certified on ISO 22301:2012 (Societal Security and Business Continuity Management System) and has a comprehensive Business Continuity and Disaster Recovery framework, to prevent potential business disruptions in the event of any disaster. It has processes that helped resume services to customer’s acceptable service levels. Automated Service Desk with SLAs for enabling business and Vulnerability Assessment and Penetration Testing Lab for secured corporate network operations are highlights that showcase the information security posture of the Organization.

Tech Mahindra (IT Division) has been assessed for the implementation of high maturity business excellence practices at Mahindra Group (Services Sector). It has been assessed at TMW Maturity Stage 7 (on scale of 1-10 stages) of Mahindra Business Excellence Framework - The Mahindra Way. These certifications are testimony of the robustness of business processes and at large, the quality culture imbibed in the organization.

Your Company has institutionalized the Deliverability Risk Assessment (DRA) practice - to assess the readiness and to identify risks at the beginning of the program, continued to strengthen the process for transforming Quality Assurance processes & delivery methods to adopt and strengthen Delivery excellence, Risk governance, and further enhance automation to enable quality delivery to the customer. Quality index which is a measure of quality of products and services delivery is institutionalized.

The Company is ensuring all these initiatives are in place, to ensure that it delivers as stated in its Quality Policy.

DIRECTORS

During the year under review, all Independent Directors have given declarations that they meet the criteria of Independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Independent Directors have also given declaration of compliance with Rules 6(1) and 6(2) of the Companies (Appointment and Qualification of Directors) Rules, 2014, with respect to their name appearing in the data bank of Independent Directors maintained by the Indian Institute of Corporate Affairs.

Pursuant to the provisions of Section 152(6)(c) of the Companies Act, 2013, Mr. Manoj Bhat, Director (DIN: 05205447) is liable to retire by rotation and being eligible offers himself for reappointment.

During the year under review, Ms. Penelope Fowler (DIN: 09591815) was appointed as Additional Director by the Board of Directors of the Company on May 13, 2022. She was further appointed as an Independent Director pursuant to the special resolution passed by the shareholders at the Annual General Meeting held on July 26, 2022 for a period of 5 years.

In view of the retirement of Mr. C. P Gurnani, Managing Director and CEO, the Board of Directors at its meeting held on June 15, 2023, based on the recommendation of the Nomination and Remuneration Committee approved the Appointment of Mr. Mohit Joshi, (DIN: 08339247) as Additional Director with effect from June 20, 2023 to hold office up to the date of ensuing Annual General Meeting. Further in order to ensure smooth transition into the role of Managing Director as Mr. C. P. Gurnani would retire on December 19, 2023, Mr. Mohit Joshi was also appointed as a Whole Time Director designated as Managing Director (Designate) and Key Managerial Personnel with effect from June 20, 2023 up to December 19, 2023 subject to the approval of the members of the Company and the Central Government.

The Board of Directors, based on the recommendation of Nomination and Remuneration Committee also approved the appointment of Mr. Mohit Joshi as Managing Director & Chief Executive Officer of the Company and Key Managerial Personnel under the Companies Act, 2013 from December 20, 2023 to June 19, 2028 (both days inclusive), subject to approval of the members of the Company and the Central Government.

The Board recommends the appointment of Mr. Manoj Bhat and Mr. Mohit Joshi to the Members at the ensuing Annual General Meeting. The brief profile of Mr. Manoj Bhat and Mr. Mohit Joshi is given in the Notice of the Annual General Meeting.

In terms of Regulation 24(1) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations 2015, Mr. T. N. Manoharan, Lead Independent Director of the Company has been appointed as Director on the Board of Tech Mahindra (Americas) Inc., a wholly

owned unlisted material subsidiary of the Company with effect from May 21, 2019.

In the opinion of the Board of Directors, the Independent Directors have relevant proficiency, expertise and experience.

FAMILIARISATION PROGRAMME

These programmes aim to provide insights into the Company to enable the Independent Directors to understand its business in depth and contribute significantly to the Company. The details of the program for familiarisation of the Independent Directors with the Company are available on its website and can be accessed at https://insights.techmahindra.com/ investors/tml-familarisation-progarmmes-for-IDs.pdf

The Board of Directors are regularly updated on changes in statutory provisions like amendments in Corporate Laws, SEBI Regulations, Taxation Laws and People related laws as applicable at the quarterly Board meetings. The Board members are also updated on the Risk universe applicable to the Company’s business. The MD & CEO of the Company had quarterly sessions with Board members sharing updates about the Company’s business strategy, operations and the key trends in the IT industry that are relevant to the Company. These updates help the Board members in keeping abreast of key changes and their impact on the Company. Further Subject Knowledge Experts from various fields are also invited to the meetings of the Board/Committees to appraise the Board Members of the latest developments in the IT and the business.

TRAINING

The Company has laid down a policy on the training of Independent Directors as part of its governance policies. The Senior Leadership of the Company periodically updates the Directors on regulatory changes, business strategy and operations.

BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and Regulation 19 read with Schedule II, Part D of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has devised a policy on evaluating the performance of the Board of Directors, the Chairman, Committees, and Individual Directors. The evaluation process was carried out through a web-based portal. The summary of the evaluation reports

was presented to the respective Committees and the Board. The Directors had given positive feedback on the overall functioning of the Committees and the Board. The suggestions made by the Directors in the evaluation process have been suitably incorporated in the processes.

NUMBER OF MEETINGS OF THE BOARD

The Board met five times during the Financial Year 2022-23. The meeting details are provided in the Corporate Governance report that forms part of this Annual Report. The maximum interval between any two meetings did not exceed 120 days as prescribed in the Companies Act, 2013 and SEBI Listing Regulations.

COMMITTEES OF THE BOARD

As on March 31, 2023, the Board has constituted seven Committees, namely, Audit Committee, Nomination and Remuneration Committee, Stakeholders Relationship Committee, Risk Management Committee, Corporate Social Responsibility Committee, Investment Committee and Securities Allotment Committee. The details of terms of reference of each Committee and the meetings held during the year are given in the Corporate Governance Report.

The Company has also formed Group Governance Council comprising of Board Members and Senior Management in terms of the SEBI Circular No. SEBI/ HO/CFD/CMD/CIR /P/2018/79 dated May 10, 2018, considering it has a large number of subsidiaries.

POLICY ON DIRECTORS’ APPOINTMENT AND REMUNERATION

The Governance policies laid down by the Board of Directors of your Company include:

i. Policy on the appointment and removal of Directors, Key Managerial Personnel and Senior Management.

ii. Policy on remuneration to the Directors, Key Managerial Personnel and Senior Management and other Employees.

The extract of these two policies is provided in "Annexure III”.

The policies are available on the website of the Company and can be accessed at https://insights. techmahindra.com/investors/Governance-Policies-including-remuneration-to-Directors-KMPS.pdf

SUCCESSION PLAN

In accordance with the principles of transparency and consistency, your Company has adopted governance policies for appointments, remuneration and evaluation of its Board of Directors, Key Managerial Personnel & Senior Management. In line with these Governance policies, the Company has established a formal Succession Planning Program for Key Managerial Personnel across the organization. The Board evaluates all such plans at a regular interval and institutes a formal program for filling any such critical position. The Board evaluates both internal and external candidates for such positions along with the recommendations of the management. The Company also has a leadership development program where it identifies high potential managers, and trains them to take up the positions of higher responsibility. The Company has identified the second line of leadership, which provides stability to the business in case of contingencies.

KEY MANAGERIAL PERSONNEL (KMP)

Pursuant to provisions of Section 203 of the Companies Act, 2013, Mr. C. P. Gurnani, Managing Director & Chief Executive Officer, Mr. Milind Kulkarni, Chief Financial Officer (up to May 31, 2022), Mr. Rohit Anand, Chief Financial Officer (w.e.f. June 1, 2022) and Mr. Anil Khatri, Company Secretary & Compliance Officer were the Key Managerial Personnel of the Company during the year under review.

DIRECTORS’ RESPONSIBILITY STATEMENT

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

i. in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

ii. they have, in the selection of the accounting policies, consulted the Statutory Auditors and these have been applied consistently and, reasonable and prudent judgments and estimates have been made so as to give a true and fair view of the state of affairs of the Company as at March 31, 2023 and of the profit of the Company for the year ended on that date;

iii. proper and sufficient care had been taken 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 other irregularities;

iv. the annual accounts have been prepared on a going concern basis;

v. they had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively;

vi. the proper systems to ensure compliance with the provisions of all applicable laws are in place and are adequate and operating effectively.

DETAILS WITH RESPECT TO ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS

The Company has internal financial controls which are adequate and were operating effectively. The controls are adequate for ensuring the orderly and efficient conduct of the business, including adherence to the Company’s policies, the safeguarding of assets, the prevention and detection of frauds and errors, the accuracy and completeness of accounting records and timely preparation of reliable financial information.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS / PROCEEDINGS

There are no significant and material orders passed by the regulators or courts or tribunal, impacting the going concern status and the Company’s operations in the future.

Further no application against the Company has been filed or is pending under the Insolvency and Bankruptcy Code, 2016, nor has the Company done any one-time settlement with any Bank or Financial institutions.

STATUTORY AUDITORS

The members, in the 35th Annual General Meeting (AGM) held on July 26, 2022, appointed M/s. B S R & Co. LLP, Chartered Accountants, [ICAI Firm’s Registration No. 101248W/W- 100022] as the Statutory Auditors of the Company, to hold office for a further term of five consecutive years from the conclusion of the 35th AGM of the Company held in

the Financial Year 2021-22 until the conclusion of the AGM of the Company for the Financial Year 2026-27 on such remuneration as may be determined by the Board of Directors.

There are no qualifications, reservations, adverse remarks or disclaimers made in the audit report for the Financial Year 2022-23.

SECRETARIAL AUDIT REPORT

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 had appointed Makarand Lele & Co., Practicing Company

Secretary, Pune to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is available at "Annexure IV” to this report. There are no qualifications, reservations, adverse remarks or disclaimers made in the Secretarial Audit Report.

COMPLIANCE WITH SECRETARIAL

STANDARDS

The Company has complied with the applicable Secretarial Standards.

ANNUAL RETURN

Pursuant to the provisions of Section 92(3) read with Section 134(3) (a) of the Companies Act, 2013, the Annual Return in Form MGT-7 is available on the website of the Company and can be accessed at https://insights.techmahindra.com/investors/mgt-7.pdf

INVESTOR EDUCATION AND PROTECTION FUND (IEPF)

During the year, the Company has transferred the unclaimed dividends of '' 2,13,40,674 to the Investor Education and Protection Fund. Further, 2,26,700 corresponding shares on which dividends were unclaimed for seven consecutive years were transferred to the fund as per the requirements of the IEPF Rules. The Members are requested to check the details of the unpaid dividend on the website of the Company and claim their dividend to avoid the shares from being transferred to IEPF.

MANAGERIAL REMUNERATION

Disclosures of the ratio of the remuneration of each director to the median employee’s remuneration and other details as required pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of

Managerial Personnel) Rules, 2014 as amended from time to time, are provided as "Annexure V”. None of the Directors or the Managing Director & CEO of the Company received any remuneration or commission from Subsidiary Companies of your Company.

The details of remuneration paid to the Directors including the Managing Director & CEO of the Company are provided in the Corporate Governance Report.

PARTICULARS OF EMPLOYEES

The information required under Section 197(12) of the Companies Act, 2013 ("the Act”) read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms part of this Report. However, pursuant to first proviso to Section 136(1) of the Act, this report is being sent to the Shareholders excluding the aforesaid information. Any shareholder interested in obtaining said information may write to the Company Secretary at the Registered Office / Corporate Office of the Company and the said information is open for inspection at the Registered Office of the Company.

POLICY ON PREVENTION OF SEXUAL HARASSMENT

Your Company has laid down the Prevention of Sexual Harassment (POSH) policy which is available on its website. The Company has zero tolerance on Sexual Harassment at workplace. During the year under review, there were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

The status of complaints received under POSH and redressed by the POSH Committee of the Company, during the Financial Year under review, are given below:

a) Number of complaints received during the year - 74

b) Number of complaints redressed during the year - 73@

c) Number of complaints pending for redressal as on March 31, 2023 - 3

@ - Includes 2 complaints received during the previous year and redressed during the year.

There are focused campaigns on the POSH policy within the Company and awareness drives that

take place. Furthermore, employees are required to undertake a mandatory certification on POSH to sensitize themselves and strengthen their awareness.

EMPLOYEE STOCK OPTION SCHEMES

During the year under review, there were no material changes in the Employee Stock Option Schemes (ESOPs) of the Company and the Schemes are in compliance with the SEBI Regulations on ESOPs.

As per Regulation 14 of Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021, the details of the ESOPs are uploaded on the website of the Company and can be accessed at https://insights.techmahindra. com/investors/details-of-esops-fy-2022-23.pdf

CORPORATE GOVERNANCE

A report on Corporate Governance covering among others composition of the Board of Directors, details of meetings of the Board and Committees along with a certificate for compliance with the conditions of Corporate Governance in accordance with the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, issued by the Statutory Auditors of the Company, forms part of this Annual Report.

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.

BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT (BRSR)

SEBI, vide its circular dated May 10, 2021, made BRSR mandatory for the top 1,000 listed companies (by market capitalization) with effect from the FY 2022-23. The Company voluntarily published BRSR for the Financial year 2021-22. The BRSR Report for the year 2022-23 is enclosed as part of this Annual Report.

In addition to the BRSR, the Integrated Annual Report of the Company provides an insight on the various ESG initiatives adopted by the Company. The ESG disclosures have been independently assured by KPMG.

COST RECORDS

Maintenance of cost records and requirement of cost audit as prescribed under the provisions of Section 148(1) of the Companies Act, 2013 are not applicable for the business activities of the Company.

RISK MANAGEMENT

The Risk Management Committee of the Board of Directors devised a Risk Management Policy and guides the operating management to identify risks, analyze their probability and impact and prepare mitigation plans. It periodically reviews the Risk Management Framework & Enterprise Risk Register which is presented by the Chief Risk Officer. The Company identifies all potential risks viz. economic, business, currency, operations, climate, governance, finance, cyber, business continuity etc. and prepares a mitigation plan for each of the risks. The elements of risk as identified by the Company with the impact and mitigation strategy are set out in the Management Discussion and Analysis Report.

ESTABLISHMENT OF VIGIL MECHANISM

The Company has laid down Whistle Blower Policy covering Vigil Mechanism with protective clauses for the Whistle Blowers. The Whistle Blower Policy is made available on the website of the Company.

DEPOSITS / LOANS & ADVANCES, GUARANTEES OR INVESTMENTS

The Company has not accepted any deposits from the public during the year under review. The particulars of loans/advances, guarantees and investments under Section 186 of the Companies Act, 2013 are given in the notes forming part of the Financial Statements.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All transactions entered with Related Parties as defined under Section 2(76) of the Companies Act, 2013 and Regulation 23 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, ("The Listing Regulations”), during the financial year under review were in the ordinary course of business and at an arm’s length pricing basis and do not attract the provisions of Section 188 of the Companies Act, 2013. There were no transactions with related parties in the Financial Year which conflicted with the interest of the Company and required compliance of the provisions of Regulation 23 of the Listing Regulations.

Suitable disclosure as required by the Indian Accounting Standards (Ind AS 24) has been made in the notes forming part of the Financial Statements.

The Company has formulated a policy on the Related Party Transactions and dealing with Related Party Transactions which has been uploaded on the website of the Company and can be accessed at https:// insights.techmahindra.com/investors/Related-Party-Transactions-Policy.pdf

The particulars of related party transactions in prescribed Form AOC - 2 are attached as ‘Annexure VI”. Pursuant to Regulation 23(9) of the Listing Regulations, your Company has filed half yearly report on Related Party Transactions with the stock exchanges.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars as prescribed under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 are provided in "Annexure VII” which forms part of this report.

CORPORATE SOCIAL RESPONSIBILITY

The CSR vision of the Company is "Empowerment through Education.”

In compliance with the guidelines prescribed under Section 135 of the Companies Act, 2013, your Company has constituted a Corporate Social Responsibility (CSR) Committee of the Board. The CSR policy, covering the Objectives, Focus Areas, Governance Structure Monitoring and Reporting Framework among others is approved by the Board of Directors. In accordance with the amendments made in Section 135 in January 2021, the CSR Policy has been duly revised and is available on the website of the Company and can be accessed at https://insights. techmahindra.com/investors/tml-csr-policy-23.pdf

The Company has spent more than 2% of the average net profits of the Company during the three immediately preceding Financial Years on CSR.

The Company’s social initiatives are mainly carried out by Tech Mahindra Foundation and Mahindra Educational Institutions, Section 8 (erstwhile Section 25) Companies promoted by the Company.

TECH MAHINDRA FOUNDATION (TMF) EDUCATION

The key initiatives taken by TMF in the arena of school education include:

ALL ROUND IMPROVEMENT IN SCHOOL EDUCATION (ARISE)

Tech Mahindra Foundation’s educational initiatives under ARISE are long-term school improvement programmes, in partnership with local governments and partner organisations. The Foundation in 2022-23 worked with 18 government primary & secondary schools to transform them into model schools of excellence. A total of 5,224 students were positively impacted under this programme, of which 2,832 were girls.

During the year, the Foundation expanded its work for children with special needs through its ARISE programme. This programme is a variant of ARISE in which children with special needs are provided chronic therapy as well as special education to help them lead more fulfilling lives. Through 32 projects, the programme enabled 4,829 children with special needs to become better learners with greater independence in managing their lives. The Foundation has taken up the provision of assistive technology for these children as an important value addition to its work in ARISE .

SHIKSHAANTAR

Shikshaantar, envisioned as a programme for enhancing the capacity of government school teachers, has emerged as an important programme in the education portfolio of the Foundation. TMF works with the Municipal Corporation of Delhi by running their In-Service Teacher Education Institutes. With the merger of the MCDs, TMF now has the responsibility of training teachers from close to 1,500 primary schools in Delhi. During the year under review, as many as 4,379 teachers were trained as part of Shikshaantar. This included specially designed modules for Digital Literacy, Child Safety, Cyber Security and Mental Health that were delivered to the teachers in a hybrid mode.

MOBILE SCIENCE LAB & ROBOTICS LAB

In order to increase the footprint of its work in Education and reach the unreached, TMF launched a unique initiative in 2019-20 - The Mobile Science Lab (MSL). For this, a Mahindra bus has been remodeled to become a science lab on wheels and has been travelling from school to school in East Delhi to provide STEM learning for children in grades 3 and 4 in these

schools. The MSL program benefitted as many as 6,861 students and 77 teachers throughout the year.

Following the success of the MSL program, TMF has also set up a Robotics Lab at one of its ARISE schools in Delhi which is an all-girls school. This lab was inaugurated in November 2022, and nearly 300 girls from this school are the potential beneficiaries.

EMPLOYABILITY

Skills-for-Market Training (SMART) is the Foundation’s flagship programme in employability. It is built on the vision of an educated, enabled and empowered India, and the belief that educated and skilled youth are the country’s true strength. The programme started with 3 Centres in 2012 and is currently running over 85 Centres at 10 locations across India. These include SMART Centres, SMART Centres (training for people with disabilities), and SMART-T Centres (training in technical trades).

In 2022-23, your Company trained 17,641 young women and men under its SMART program, of which, 1,303 were persons with disabilities. More than 70% of the graduates are placed in jobs across multiple industries upon successful completion of the training. The average salaries being earned by the graduates of the SMART program have been steadily rising and saw a 10% jump over the previous year.

The Foundation’s commitment to setting new benchmarks in skill development in India has been underscored by the setting up of Tech Mahindra SMART Academies, which provide the highest quality of skill training to youngsters in Healthcare and Digital Technologies. During FY 2022-23, 3,584 students were trained at the nine Academies that are now functional - 5 in Healthcare, 3 in Digital Technologies, and 1 in Logistics.

TMF’S OUTREACH INITIATIVES

In addition to all the core programs described above, Tech Mahindra Foundation is now also implementing several outreach projects in collaboration with various agencies. As part of these, the TMF team members are engaged in activities such as community health initiatives, teacher training, provision of content for other large-scale projects, etc. As part of such outreach projects, TMF supported 20,734 beneficiaries, taking the total tally of direct beneficiaries for the year to 61,995. This is nearly 50% more than the number of direct beneficiaries for FY 2021-22, which stood at 41,374.

MAHINDRA EDUCATIONAL INSTITUTIONS (MEI)

MEI - a not-for-profit, 100% subsidiary of the Company has set up Mahindra Ecole Centrale in August 2014 - through a collaborative venture between Mahindra Educational Institutions and Ecole Centrale of Paris, France (now known as Centrale Supelec) and the JNTU Hyderabad - to offer undergraduate engineering programs. Through this strong Indo-French Collaboration with Centrale Supelec and Industry connect with Tech Mahindra, MEC has emerged as a disruptive player in the field of Technical Education.

MEI has sponsored the setting up of Mahindra University to introduce diverse streams of education in addition to Engineering. Further the Engineering stream is being transitioned to Mahindra University.

MAHINDRA UNIVERSITY (MU)

Mahindra University ("MU”) (sponsored by Mahindra Educational Institutions, ("MEI”) - a not-for-profit, 100% subsidiary of Tech Mahindra), was notified on May 20, 2020 by the Government of Telangana vide The Telangana State Private Universities (Establishment and Regulation) Act, 2018 for "educating future citizens for and of a better world”.

The Ecole Centrale School of Engineering (ECSoE) currently runs various UG, PG and Ph.D. programs in cutting-edge engineering departments. ECSoE also launched a Centre for Life Sciences and offers courses in biotechnology and computational biology under it. The school plans to launch the 2.5 year integrated programs in Biotechnology & CSE for AY 2023-24.

Cornell University’s SC Johnson College of Business, an ivy league institution is the "Academic Partner” for School of Management. Mahindra University’s School of Management (MU - SoM) will benefit significantly from Cornell University’s expertise in curriculum development, faculty exchange programs including some specialty courses delivery by the Cornell faculty to Mahindra University students, as well as student immersion at Cornell. The School of Management currently conducts BBA, BA, E-MBA, and MBA (starting in 2023) programs.

The School of Law, Mahindra University, commenced operations in September 2021 in Hyderabad offering 5-year integrated programs in BA LL.B and BBA LL.B. It was founded on the philosophy of securing justice, equality, and service to all sections of society. With the needs of modern society evolving rapidly, there is a renewed focus on the importance of the discipline of

law. The School of Law will aim to make a difference to the legal profession and practice by providing a diverse, flexible curriculum and pedagogy, touching on several aspects of domestic and international law, while appraising the students of the latest trends in academia and practice. Starting 2022, the School of Law has launched a 3-year LLB (Hons) program and intend to launch a 6-year integrated B.Tech LLB course starting Academic Year 2023.

The University also plans to launch the following programs/schools for the Academic Year 2023-24:

1. School of Media

a. 4-year B.Tech. (Computation & Media)

b. 3-year BA (Digital Media & Communication)

2. School of Hotel Management

a. 3-year B.Sc. (Hospitality & Hotel Administration)

In the academic year 2022, a total of 2,971 students were studying under various programs across all schools and departments. The new admissions for academic year 2022 are 1,236 students of which 1,128 students are in various UG programs, including School of Management and School of Law, 22 students in the PG programs of School of Engineering and 86 students in the Ph.D programs across all the schools.

The Annual Report on CSR activities is provided as "Annexure VIII”.

SUSTAINABILITY

Your Company aligns closely with the Mahindra Group’s ambition to Rise: Be People positive, Planet positive, and Trust positive. The Company holistically embraces ever greater responsibility towards protecting the environment, empowering the society, and providing good governance.

Your Company’s strategy for creating long-term sustainable value is by improving, scaling, and transparently communicating our ecological, social, and economic impacts. Our strong governance framework led by the Board of Directors of your Company, who have oversight of the Company’s overall strategy and future direction and ensures the planning and implementation of environmental and social programs.

The Company’s holistic approach enables to drive sustainable impact in alignment with leading global frameworks, initiatives, and agendas committed to furthering sustainability such as the TCFD, SASB, GRI, as well as the Paris Agreement, the UNGC and the UN SDGs.

As a business, the Company recognizes the value of following the UN SDGs (Sustainable Development Goals) of People, Planet, Prosperity, and Partnership and continues to create value through initiatives that cater directly to these aspects of our performance.

People:

• Great place to work: Working to enhance our organizational culture by enabling our associates with access to advanced technologies, providing Learning & Development opportunities to help develop their skills and areas of expertise and providing them with robust career development programmes.

• Work-life balance: Providing feasible and flexible work-life balance and integration along with a range of associate-friendly policies and processes to reduce attrition.

• Diversity and inclusion: Ensuring that our organization continues to transcend into the realms of gender diversity and includes people with disabilities as well as people from the LGBTQIA community as part of being a socially responsible business.

• Employee engagement & recognition:

Ensuring our associates are engaged, feel valued, and recognized through a robust performance management system, a flexible system of working, and an extensive system of benefits and perquisites.

• Individual Social Responsibility: Encouraging associates to contribute to the society & environment and make these activities an integral part of their day-to-day activities.

Planet:

• Carbon neutrality and Net zero: Committing to carbon neutrality (2030) and Net zero (2035) by switching to renewable energy through on site installations and open access; improving energy efficiency through installation of LEDs, sensors; boosting green investments by

implementing Carbon Price; optimizing business travel by enabling virtual meetings; encouraging use of public transport and carpooling to reduce employee commute emissions; carbon sequestration through tree plantation; moving towards a low carbon economy by optimizing operations to ensure environmental protection.

• No waste to landfill: Installing Organic Waste Converters and vermicomposting plants at own campuses to convert food waste to manure, cutting down their transportation emissions and reducing waste to landfill.

• No to plastic: Maintaining plastic-free campuses and encouraging all stakeholders to use ecofriendly and biodegradable materials. Spreading awareness and initiating campaigns on preventing single-use plastic.

• Reduce, Reuse, Recycle, Recover: Implementing the process of Reduce, Reuse, Recycle and Recover across the value chain to limit waste and enable a circular economy.

• Being water positive: Improving water efficiency and increasing water savings by using water sensors, restrictors and water-efficient coolers, recycling wastewater through STPs, and recharging groundwater levels with Rainwater Harvesting Pits.

• Promoting Biodiversity: Protecting local flora and fauna across all our locations to ensure that we do not adversely impact biodiversity through our operations.

Prosperity:

• Innovation: Embracing technology and innovation by incorporating IoT, Blockchain, AI and Machine Learning to develop a portfolio of sustainable solutions that help reduce emissions and other negative impacts of climate change.

• Green solutions: Investing in Sustainability reporting solution (i.Sustain) and Climate Risk Management platforms, Smart grid, Microgrid-As-A-Service, Community Action Platform for Energy, Integrated Electric Vehicle Charging systems (IEVCS), Smart data hubs and Smart Cities for our Customers to reduce their carbon emissions.

• Connecting with customers: Embracing brand equity by connecting with our customers to address their current and future needs and ensuring customer satisfaction.

Partnership

• Learning and Sharing: Partnering with collaborators & partner companies to create an alliance ecosystem and supplement each other’s capabilities on joint projects. Collaborating with academia, businesses, NGOs, and governments to address some of the global challenges like health care, climate change, inequality, etc.

• Sustainable supply chain: Ensuring that we are in synch with our value chain in our commitment towards climate action and helping our suppliers follow the highest standards of sustainable and ethical best practices within their own organizations.

Tech Mahindra has drafted its Integrated Annual report in accordance with Global Reporting standards and frameworks with the data assured by a third party thus complying with the highest transparency standards.

The Company’s progress against the sustainability targets and metrics are disclosed in the externally assured Integrated reports available on the website of the company- https://www.techmahindra.com/en-in/ sustainability/

AWARDS AND RECOGNITION

Your Company continued its quest for excellence in its chosen area of business to emerge as a true global brand. Several awards and rankings continue to endorse your Company as a thought leader in the industry. A few of the prominent Awards / recognitions received by the Company during the Financial Year 2022-23 include:

• Tech Mahindra won several medals in the USA for its people practices- Brandon Hall HCM Excellence Awards, Stevie Awards for Great Employers and was also included in the 2023 Bloomberg Gender-Equality Index (GEI).

• Tech Mahindra Philippines was certified as a Great Place to Work.

• The Economic Times bestowed Tech Mahindra with several recognitions including Great Manager Awards (People Business), Human Capital Awards and ‘Best Organizations for Women’ (Femina).

• Tech Mahindra was also recognized by Avtar and Seramount as "Champions” in Most Inclusive Companies Index and "Top 10” in Best Companies for Women in India.

• Dun & Bradstreet India recognized Tech Mahindra as a top performer in the ESG Performance -Software and BPM sector.

• Tech Mahindra won Frost & Sullivan’s Technology Innovation Leadership Award 2022 for Metaverse Technology Services.

• Tech Mahindra was recognized among the Iconic brands at ET Iconic Brands 2022.

• TechM amplifAI0->^ is awarded "Cool Product or Service of the Year in Business 2022.” at the 12th Annual 2022 Business Excellence Awards by Globee® Business Awards.

• Tech Mahindra MEA was recognized for Ground-breaking products/services in Ecommerce at GITEX.

• Tech Mahindra was awarded ‘A’ rating in MSCI ESG ratings 2022.

• Tech Mahindra received the "Mahatma Award 2022 for Social Good & Impact - Decent Work and Economic Growth” for its SMART Program.

These awards are a reflection of the Company’s continued efforts in the fields of business, sustainability, human resource management and its sustained progress towards creating a better society for all.

ACKNOWLEDGEMENTS

Your directors place on records their appreciation for the contributions made by employees towards the success of your Company. Your directors gratefully acknowledge the co-operation and support received from the shareholders, customers, vendors, bankers, Regulatory and Governmental authorities in India and abroad.

For and on behalf of the Board

Anand G. Mahindra Place: Mumbai Chairman

Date: 15th June, 2023 (DIN: 00004695)

Note: The Board of Directors at its meeting held on April 27, 2023, had approved the financial statements for the financial year 2023 and the Director''s Report along with the Annexures. However, in view of the appointment of Mr. Mohit Joshi as Additional Director and Whole Time Director, the revised Director''s Report was approved by the Board at its Meeting held on June 15, 2023.

1

Interim Dividend (Special Dividend) for the Financial Year ended March 31, 2022 and Final Dividend for the Financial Year ended March 31, 2021


Mar 31, 2023

Your directors are pleased to present the Thirty Sixth Annual Report along with the audited accounts of your Company for the year ended March 31, 2023.

FINANCIAL RESULTS (STANDALONE)

('' in Million)

For the year ended March 31

2023

2022#

Income

437,856

372,079

Profit Before Interest, Depreciation and Tax

58,978

72,383

Interest

(1,808)

(689)

Depreciation

(8,129)

(7,403)

Profit Before Tax

49,041

64,291

Provision for Taxation

(11,266)

(14,058)

Profit After Tax

37,775

50,233

Other Comprehensive Income

(2,480)

1,200

Balance brought forward from previous year

216,090

203,329

Profit available for appropriation

253,917

253,292

Equity Dividends

(46,705)1

(43,624)1

Transfer to retained earnings on account of options lapsed

99

74

Transferred from Special Economic Zone re-investment reserve on utilization

7,151

6,348

Balance carried forward

214,462

216,090

# - Figures for the previous year are restated after considering the amalgamation of Tech Mahindra Business Services Limited and Born Commerce Private Limited with the Company.

1 Interim Dividend (Special Dividend) for the Financial Year ended March 31, 2023 and Final Dividend for the Financial Year ended March 31,2022

DIVIDEND

The Board of Directors on November 1, 2022 approved a special interim dividend of '' 18/- per share (i.e. 360%) on the par value of '' 5/- each which was paid by the Company to the shareholders whose names appeared in the Register of Members as on November 10, 2022, being the record date for the payment of dividend. Your Directors are pleased to recommend a final dividend of '' 32/- per share on par value of '' 5/- (i.e. 640%), payable to those Shareholders whose names appear in the Register of Members as on the Book Closure Date. Thus, the total dividend for the FY 2022-23 will be '' 50/- per share (i.e. 1000%) against the dividend of '' 45/- per share (i.e. 900%) paid for the Financial Year 2021-22.

The Board of your Company decided not to transfer any amount to the General Reserve for the year under review.

Your Company has formulated a Dividend Policy which is disclosed on the website of the Company and can be accessed at https://insights.techmahindra.com/ investors/tml-dividend-distribution-policy.pdf

SHARE CAPITAL

During the year under review, your Company allotted 2,313,996 equity shares on the exercise of stock options under various Employee Stock Option Schemes. Consequently, the issued, subscribed and paid-up equity share capital has increased from '' 4,859.17 million divided into 971,833,479 equity shares of '' 5/- each to '' 4,870.74 million divided into 974,147,475 equity shares of '' 5/- each.

ALTERATION OF ‘CAPITAL CLAUSE’ OF MEMORANDUM OF ASSOCIATION

Consequent to the merger of Tech Mahindra Business Services Limited and Born Commerce Private Limited with the Company, the Authorised Capital of the

Company increased from '' 8,336.50 million divided into 1,667,300,000 equity shares of '' 5/- each to '' 9,093 million divided into 1,818,600,000 equity shares of '' 5/- each.

Accordingly, the Capital Clause of the Memorandum of Association of the Company was altered and substituted with the new Clause V to reflect the corresponding changes in the Authorised Share Capital.

BUSINESS PERFORMANCE / FINANCIAL OVERVIEW

Imperative for businesses and your Company to stay relevant is the need to be cognizant of the tectonic shifts occurring around the world. Technological innovations, climate change and the need for inclusive growth and representation among others is defining the way organization’s function. Tech Mahindra has remained on the forefront of all cutting-edge technological advancements and harnessed many emerging technologies to transform customer and employee experiences. Your Company’s execution strategy is indexed to the pillars of client focus, portfolio synergy, operational rigor, new age technology bets and people transformation.

During the Financial Year ended on March 31, 2023, the Company’s revenues grew to '' 532,902 million on a consolidated basis as against '' 446,460 million in the previous year - indicating a robust growth of 19.4%. The growth was broad based across geographies as both Americas and Europe contributed in line with overall business growth. The Company also saw healthy growth across business segments in Communications, Media and Entertainment (CME) and Enterprise verticals.

The EBITDA on a consolidated basis for the Financial Year 2023 was '' 80,288 million, similar to the previous year’s EBITDA of '' 80,200 million. The resultant EBITDA margins were in the range of 15.1% in FY 2023 compared to 18.1% in FY 2022. The post-tax profit of the Company was reduced to '' 48,313 million in FY 2023 as against '' 55,661 million in FY 2022.

The Company saw robust demand for digital transformation services with a focus on customer experience and cloud. The Company has seen new deal wins close to USD 3,000 million during the year, indicating a healthy growth momentum across all business verticals. Your Company’s investments in Enterprise SaaS and Hi-tech capabilities will help

it cater to increasing modernization demands from businesses in the Financial Year 2024 and beyond.

MATERIAL CHANGES AND COMMITMENTS AFFECTING FINANCIAL POSITION BETWEEN THE END OF THE FINANCIAL YEAR AND THE DATE OF THE REPORT

There have been no material changes and commitments which affect the financial position of the Company that have occurred between the end of the financial year to which the financial statements relate and the date of this report.

ACQUISITIONS

Your company made the following acquisition during the FY 2022-23.

THIRDWARE SOLUTIONS LIMITED

The Company acquired 100% of the share capital of Thirdware Solutions Limited ("Thirdware”) on June 3, 2022 at a consideration up to USD 42 million including earnouts. Thirdware is a global player in Enterprise Applications and will enhance the Company’s digital solutions and services in automotive consultant and design, development and implementation in areas like ERP (Enterprise Resource Planning), EPM (Enterprise Performance Management), RPA (Robotic Process Automation) and IloT (Industrial Internet of Things). These capabilities will give the Company an edge in the manufacturing space.

UPDATE ON MERGER

Your directors at their meeting held on January 31, 2021 approved the Scheme of Merger of Tech Mahindra Business Services Limited (TMBSL) and Born Commerce Private Limited (Born) with the Company with the appointed date as April 1, 2021.

Hon’ble NCLT, Mumbai bench and Hon’ble NCLT, Chennai bench vide their order dated January 5, 2023 and January 12, 2023 respectively, approved the scheme of merger by absorption of the TMBSL and Born with the Company and their respective shareholders and the said Scheme has become effective on February 16, 2023.

SUBSIDIARIES, ASSOCIATES AND JOINT VENTURES OF THE COMPANY

The performance and financial position of the subsidiaries, associates, and joint venture companies included in the consolidated financial statement is provided in accordance with the provisions of Section

129 read with Rule 5 of the Companies (Accounts) Rules, 2014 containing the salient features of the financial statement of the Company’s subsidiaries/joint ventures or associate companies in Form AOC - 1 in “Annexure I” to this report.

Pursuant to Rule 8(5)(iv) of the Companies (Accounts) Rules, 2014, the names of the companies which have been incorporated or ceased to be the subsidiaries, joint ventures or associate companies during the year are provided in “Annexure II” to this report. The Company is actively pursuing the initiative on the consolidation of its subsidiaries/branches to optimize the operational costs. During the year under review, your Company has closed/merged twenty subsidiaries.

HUMAN RESOURCES

The employees of the Company are the most critical asset to your Company. The Company has taken several steps to protect, retain, and improve the competencies of these assets including:

Hiring: Forecast to Fulfilment

Your Company has streamlined its talent hiring process adopting some best-in-class practices. By building predictability in talent planning & forecasting for new age skills, your Company has been able to fuel business growth. Your Company has revamped its Buddy Referral programs to recruit talent from existing employee networks while offering attractive incentives. Embracing diversity in the hiring process has improved the global and local representation of talent within the organization. The Company has also redesigned its Candidate Engagement process to focus on creating positive experiences from the issuing joining offer letter to internal deployment to client projects. With rigor in talent allocation and proactive skilling of bench talent, your Company has been able to increase its internal fulfilment to 71% from 48% which is the best in the industry.

Learning: Skilling on the job

With the growth in digital business, your Company has been transforming its workforce both at speed and scale. The Company accelerated skilling initiatives to keep up with the pace of technological developments and built a ‘future-ready’ talent pool. #NAD Learn, the Al-based platform with interactive, on-demand, contextual and hyper-personalised up-skilling is helping the Company develop full-stack professionals. Your Company has supplemented this with young leadership development programs as well

as new policies to promote niche skilling and fast-track career growth. Employees can learn and grow as a Fresher through Elevate, in customer deployments through Project Skilling, for career progression through Future Skilling and into the leadership pipeline through journey-based programs. The Company also offers super-specialization skilling programs including Architect CoE, HiPOT programs at units and Program Manager CoE through EMBARK. Some new programs that the Company has recently launched for high-potential talent development include MALT and TrIBE.

Leadership: Integrative Thinking

The natural culture of empowerment that was supercharged during the pandemic continues to be the mainstay in the current hybrid work environment. Your Company aims to help employees imbibe mindsets & behaviors for the future which include a renewed focus on Integrative Thinking, Business & Financial Acumen, Bias for Action, Closure over Follow-up, Data over Emotions and Extreme Ownership. This was reinforced through the adoption of an industry leading learning platform - Harvard Manage Mentor Spark aimed at imparting best-in-class training at every level in realtime. Your Company has a robust Talent Management process for developing the leadership talent pipeline and has adopted consistent coaching practices for managers. Apart from Coaching, the employees have experienced new forms of learning with technology-enabled tools and pedagogies. For example, the ‘Wheel of Life’ is a customized self-coaching tool with gamified journeys, and personalized Habit Tracking making personal and professional well-being goals accessible to every employee.

Performance: Feedback focused

Your Company launched the Annual Performance Feedback cycle in December 2022. In order to build a culture where performance is enabled through feedback, Managers have been trained to have better performance review dialogues with their direct reports and work on an outcome-based evaluation rather than process or effort measurement. Your Company is creating a High-Performance Culture through hyper-personalized Incentive plans. Your Company has a suite of Incentive plans that are designed to create a strong alignment between Individual growth and Organization performance.

Wellness: Collective well-being

Your Company puts a happier, healthier and more productive workforce at the core of its business, policies and decisions. Your Company has designed

initiatives covering eight dimensions of wellness -Physical, Occupational, Emotional, Spiritual, Social, Environmental, Financial and Intellectual. The focus on preventative care with Corporate paid preventive health check, on-campus doctor consultations & counselling programs, helps employees diagnose any health condition in advance. To tackle IT industry specific issues, the Company organizes wellness sessions on Ergonomics, Healthy eating, Lifestyle management etc. Multiple tech-enabled wellness interventions like Kick the Butt (Smoking Cessation Program), Bend it like TechM (Guide to Ergonomics), Dump the Plump (Weight loss challenge) etc. have helped employees create healthier habits. Through the People Care program, managers are encouraged to show their human side and empower their team members to pursue collective well-being.

Communication: Building purpose

A robust communication process is at the heart of the Company’s vibrant culture. Employees are kept connected and informed through multiple media. Your Company’s 360-degree communication framework ensures employees have access to connect with leaders, peers and the external world. With publications, platforms, storytelling, campaigns, and connects, the organizational culture is shared with all. Your Company shares stories of diverse individuals achieving extraordinary things using structured formats like #RiseFromWithin. Leaders in the Company share not just business updates and success stories but personal anecdotes that reinforce the belief of a shared destiny.

Engagement: Hybrid connects

For an increasingly hybrid workplace, the Company has designed several virtual ‘water-cooler’ moments like All Hand Meets with CXO, Prime Time, Location Connects etc. along with family connects. Employees have platforms like MS Teams and Cisco WebEx for collaborative yet decentralized working. Your Company also organized on-ground engagement linked to TechM’s FIDE partnership for the Chess Olympiad. TechM CARES Action Planning workshops were also organized across different business units to implement changes based on employee feedback. Your Company also organized more than 1,200 engagement programs globally linked to Rise Refresh.

Rise Refresh: #TogetherWeRise

For more than a decade, the Rise philosophy has inspired employees from across the Mahindra Group to come to work and build something meaningful.

Since then, the world has changed with the rise of disruptive technologies, changing start-up ecosystem, climate change and recently, the pandemic. This is why, the Company has defined a new core purpose and brand pillars of Rise to simplify and sharpen its commitments. Your Company has leveraged every possible medium to ensure that this is communicated to all employees. From the conventional posters, communities, blogs, leader-bytes, microsite, quizzes and signatures route to the unconventional music, memes, WhatsApp stickers, GenZ lingo, podcast conversations and comic strips, Rise has touched the heart of every employee.

Diversity: Respecting Individuality

Your Company believes that respecting diversity and ensuring inclusion is fundamentally the right thing to do. It respects, embraces and celebrates the uniqueness of every individual. This also links back to the stated objective of the Company to be human-centered by encouraging associates to bring their most authentic selves to work. Your Company initiated the Maternity Assistance Program (MAP) to support employees who were on Maternity Leave in their transition back to work. The Company has also organized several Fireside chats featuring women with STEAM (Science, Technology, Engineering, Arts, Mathematics) roles to inspire others to grow in these fields. Through the ‘Restart’ Program, the Company aims to help Women IT Professionals restart their career after a break.

Recognition: Appreciation always

Your Company believes in appreciating, recognizing, and celebrating by building a culture where good work and behavior are appreciated. The Company has designed specialized recognition programs where rewards, tenure, performance, and contribution are celebrated, often with the loved ones of employees. The recognition program is centered around n = 1, that is, the individual at the heart of everything. A key part of personalizing recognition is to bring it to the desk of every employee. This is enabled by the KUDOS portal that offers recognition badges as well as redemption options for the points earned. Giving employees the ability to appreciate colleagues and sustained campaigns have led your Company to have an industry leading rewards penetration of ~74% including monetary and non-monetary recognition. Tenure is rewarded with personalized gifts for both the employee and their family members. Lastly, there are several organizational level awards for outstanding achievements like the ACE, STAR, Location Council and Spotlight awards.

HR Digitization: Experiencing technology

Your Company has revolutionized employee experience by deploying technology at different touchpoints of their lifecycle. Your Company continued its internal automation focus by using Robotic Process Automation for completing common workforce actions to reduce manual work. Your Company has also integrated HR Chatbot UVO and Technical Support Chatbot ATOM into MS Teams making it easier to perform workforce actions like leave applications, pending approvals, ticket registrations etc. Developing an "Attrition Prediction Model” has provided Your Company with an early warning system predicting the employees’ likelihood to quit, giving the Business HR team the ability to stage an intervention. The Company has also explored the use of Metaverse where three dimensional avatars interact in a virtual world to develop modules for hiring and on-boarding. Translating these experiences to mobile devices, the Company has developed ‘The Wheel of Life’ application as a self-coaching tool.

QUALITY

The Company continues its focus on quality and strives to exceed customer expectations at all times. During the year, it continued to strengthen the implementation of Quality systems and upgraded the processes/systems to comply with CMMI V 2.0 for both Development and Services and currently assessed for maturity level 5. Similarly it underwent various upgrade and re-certification audits for multiple standards during the year in order to meet client demands and enhance value delivery - successfully re-certified, ISO 9001:2015 (Quality Management System), ISO 20000-1:2018 (Information Technology Service Management System), ISO 27001:2013 (Information Security Management System), ISO 27701:2019 (Privacy Information Management System), TL9000 R 6.2/ R5.7 (Quality Management Systems for Tele Communications industry), ISO 13485:2016 (Quality Management Systems for medical devices - scope of certification limited to medical devices business within Tech Mahindra), AS9100 Rev D (Standard for Aerospace domain - scope of certification limited to the aerospace business within Tech Mahindra), ISO 17025:2017 - Laboratory Quality Management Systems for our device testing labs.

In addition to these, your Company also maintains its commitment to health, safety and environment by continually improving its processes in accordance with ISO 14001:2015 (Environmental Management System) and ISO 45001: 2018 (Occupational Health and Safety

Assessment Series) standards. Your Company is also certified on ISO 22301:2012 (Societal Security and Business Continuity Management System) and has a comprehensive Business Continuity and Disaster Recovery framework, to prevent potential business disruptions in the event of any disaster. It has processes that helped resume services to customer’s acceptable service levels. Automated Service Desk with SLAs for enabling business and Vulnerability Assessment and Penetration Testing Lab for secured corporate network operations are highlights that showcase the information security posture of the Organization.

Tech Mahindra (IT Division) has been assessed for the implementation of high maturity business excellence practices at Mahindra Group (Services Sector). It has been assessed at TMW Maturity Stage 7 (on scale of 1-10 stages) of Mahindra Business Excellence Framework - The Mahindra Way. These certifications are testimony of the robustness of business processes and at large, the quality culture imbibed in the organization.

Your Company has institutionalized the Deliverability Risk Assessment (DRA) practice - to assess the readiness and to identify risks at the beginning of the program, continued to strengthen the process for transforming Quality Assurance processes & delivery methods to adopt and strengthen Delivery excellence, Risk governance, and further enhance automation to enable quality delivery to the customer. Quality index which is a measure of quality of products and services delivery is institutionalized.

The Company is ensuring all these initiatives are in place, to ensure that it delivers as stated in its Quality Policy.

DIRECTORS

During the year under review, all Independent Directors have given declarations that they meet the criteria of Independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Independent Directors have also given declaration of compliance with Rules 6(1) and 6(2) of the Companies (Appointment and Qualification of Directors) Rules, 2014, with respect to their name appearing in the data bank of Independent Directors maintained by the Indian Institute of Corporate Affairs.

Pursuant to the provisions of Section 152(6)(c) of the Companies Act, 2013, Mr. Manoj Bhat, Director (DIN: 05205447) is liable to retire by rotation and being eligible offers himself for reappointment.

During the year under review, Ms. Penelope Fowler (DIN: 09591815) was appointed as Additional Director by the Board of Directors of the Company on May 13, 2022. She was further appointed as an Independent Director pursuant to the special resolution passed by the shareholders at the Annual General Meeting held on July 26, 2022 for a period of 5 years.

In view of the retirement of Mr. C. P Gurnani, Managing Director and CEO, the Board of Directors at its meeting held on June 15, 2023, based on the recommendation of the Nomination and Remuneration Committee approved the Appointment of Mr. Mohit Joshi, (DIN: 08339247) as Additional Director with effect from June 20, 2023 to hold office up to the date of ensuing Annual General Meeting. Further in order to ensure smooth transition into the role of Managing Director as Mr. C. P. Gurnani would retire on December 19, 2023, Mr. Mohit Joshi was also appointed as a Whole Time Director designated as Managing Director (Designate) and Key Managerial Personnel with effect from June 20, 2023 up to December 19, 2023 subject to the approval of the members of the Company and the Central Government.

The Board of Directors, based on the recommendation of Nomination and Remuneration Committee also approved the appointment of Mr. Mohit Joshi as Managing Director & Chief Executive Officer of the Company and Key Managerial Personnel under the Companies Act, 2013 from December 20, 2023 to June 19, 2028 (both days inclusive), subject to approval of the members of the Company and the Central Government.

The Board recommends the appointment of Mr. Manoj Bhat and Mr. Mohit Joshi to the Members at the ensuing Annual General Meeting. The brief profile of Mr. Manoj Bhat and Mr. Mohit Joshi is given in the Notice of the Annual General Meeting.

In terms of Regulation 24(1) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations 2015, Mr. T. N. Manoharan, Lead Independent Director of the Company has been appointed as Director on the Board of Tech Mahindra (Americas) Inc., a wholly

owned unlisted material subsidiary of the Company with effect from May 21, 2019.

In the opinion of the Board of Directors, the Independent Directors have relevant proficiency, expertise and experience.

FAMILIARISATION PROGRAMME

These programmes aim to provide insights into the Company to enable the Independent Directors to understand its business in depth and contribute significantly to the Company. The details of the program for familiarisation of the Independent Directors with the Company are available on its website and can be accessed at https://insights.techmahindra.com/ investors/tml-familarisation-progarmmes-for-IDs.pdf

The Board of Directors are regularly updated on changes in statutory provisions like amendments in Corporate Laws, SEBI Regulations, Taxation Laws and People related laws as applicable at the quarterly Board meetings. The Board members are also updated on the Risk universe applicable to the Company’s business. The MD & CEO of the Company had quarterly sessions with Board members sharing updates about the Company’s business strategy, operations and the key trends in the IT industry that are relevant to the Company. These updates help the Board members in keeping abreast of key changes and their impact on the Company. Further Subject Knowledge Experts from various fields are also invited to the meetings of the Board/Committees to appraise the Board Members of the latest developments in the IT and the business.

TRAINING

The Company has laid down a policy on the training of Independent Directors as part of its governance policies. The Senior Leadership of the Company periodically updates the Directors on regulatory changes, business strategy and operations.

BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and Regulation 19 read with Schedule II, Part D of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has devised a policy on evaluating the performance of the Board of Directors, the Chairman, Committees, and Individual Directors. The evaluation process was carried out through a web-based portal. The summary of the evaluation reports

was presented to the respective Committees and the Board. The Directors had given positive feedback on the overall functioning of the Committees and the Board. The suggestions made by the Directors in the evaluation process have been suitably incorporated in the processes.

NUMBER OF MEETINGS OF THE BOARD

The Board met five times during the Financial Year 2022-23. The meeting details are provided in the Corporate Governance report that forms part of this Annual Report. The maximum interval between any two meetings did not exceed 120 days as prescribed in the Companies Act, 2013 and SEBI Listing Regulations.

COMMITTEES OF THE BOARD

As on March 31, 2023, the Board has constituted seven Committees, namely, Audit Committee, Nomination and Remuneration Committee, Stakeholders Relationship Committee, Risk Management Committee, Corporate Social Responsibility Committee, Investment Committee and Securities Allotment Committee. The details of terms of reference of each Committee and the meetings held during the year are given in the Corporate Governance Report.

The Company has also formed Group Governance Council comprising of Board Members and Senior Management in terms of the SEBI Circular No. SEBI/ HO/CFD/CMD/CIR /P/2018/79 dated May 10, 2018, considering it has a large number of subsidiaries.

POLICY ON DIRECTORS’ APPOINTMENT AND REMUNERATION

The Governance policies laid down by the Board of Directors of your Company include:

i. Policy on the appointment and removal of Directors, Key Managerial Personnel and Senior Management.

ii. Policy on remuneration to the Directors, Key Managerial Personnel and Senior Management and other Employees.

The extract of these two policies is provided in "Annexure III”.

The policies are available on the website of the Company and can be accessed at https://insights. techmahindra.com/investors/Governance-Policies-including-remuneration-to-Directors-KMPS.pdf

SUCCESSION PLAN

In accordance with the principles of transparency and consistency, your Company has adopted governance policies for appointments, remuneration and evaluation of its Board of Directors, Key Managerial Personnel & Senior Management. In line with these Governance policies, the Company has established a formal Succession Planning Program for Key Managerial Personnel across the organization. The Board evaluates all such plans at a regular interval and institutes a formal program for filling any such critical position. The Board evaluates both internal and external candidates for such positions along with the recommendations of the management. The Company also has a leadership development program where it identifies high potential managers, and trains them to take up the positions of higher responsibility. The Company has identified the second line of leadership, which provides stability to the business in case of contingencies.

KEY MANAGERIAL PERSONNEL (KMP)

Pursuant to provisions of Section 203 of the Companies Act, 2013, Mr. C. P. Gurnani, Managing Director & Chief Executive Officer, Mr. Milind Kulkarni, Chief Financial Officer (up to May 31, 2022), Mr. Rohit Anand, Chief Financial Officer (w.e.f. June 1, 2022) and Mr. Anil Khatri, Company Secretary & Compliance Officer were the Key Managerial Personnel of the Company during the year under review.

DIRECTORS’ RESPONSIBILITY STATEMENT

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

i. in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

ii. they have, in the selection of the accounting policies, consulted the Statutory Auditors and these have been applied consistently and, reasonable and prudent judgments and estimates have been made so as to give a true and fair view of the state of affairs of the Company as at March 31, 2023 and of the profit of the Company for the year ended on that date;

iii. proper and sufficient care had been taken 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 other irregularities;

iv. the annual accounts have been prepared on a going concern basis;

v. they had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively;

vi. the proper systems to ensure compliance with the provisions of all applicable laws are in place and are adequate and operating effectively.

DETAILS WITH RESPECT TO ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS

The Company has internal financial controls which are adequate and were operating effectively. The controls are adequate for ensuring the orderly and efficient conduct of the business, including adherence to the Company’s policies, the safeguarding of assets, the prevention and detection of frauds and errors, the accuracy and completeness of accounting records and timely preparation of reliable financial information.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS / PROCEEDINGS

There are no significant and material orders passed by the regulators or courts or tribunal, impacting the going concern status and the Company’s operations in the future.

Further no application against the Company has been filed or is pending under the Insolvency and Bankruptcy Code, 2016, nor has the Company done any one-time settlement with any Bank or Financial institutions.

STATUTORY AUDITORS

The members, in the 35th Annual General Meeting (AGM) held on July 26, 2022, appointed M/s. B S R & Co. LLP, Chartered Accountants, [ICAI Firm’s Registration No. 101248W/W- 100022] as the Statutory Auditors of the Company, to hold office for a further term of five consecutive years from the conclusion of the 35th AGM of the Company held in

the Financial Year 2021-22 until the conclusion of the AGM of the Company for the Financial Year 2026-27 on such remuneration as may be determined by the Board of Directors.

There are no qualifications, reservations, adverse remarks or disclaimers made in the audit report for the Financial Year 2022-23.

SECRETARIAL AUDIT REPORT

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 had appointed Makarand Lele & Co., Practicing Company

Secretary, Pune to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is available at "Annexure IV” to this report. There are no qualifications, reservations, adverse remarks or disclaimers made in the Secretarial Audit Report.

COMPLIANCE WITH SECRETARIAL

STANDARDS

The Company has complied with the applicable Secretarial Standards.

ANNUAL RETURN

Pursuant to the provisions of Section 92(3) read with Section 134(3) (a) of the Companies Act, 2013, the Annual Return in Form MGT-7 is available on the website of the Company and can be accessed at https://insights.techmahindra.com/investors/mgt-7.pdf

INVESTOR EDUCATION AND PROTECTION FUND (IEPF)

During the year, the Company has transferred the unclaimed dividends of '' 2,13,40,674 to the Investor Education and Protection Fund. Further, 2,26,700 corresponding shares on which dividends were unclaimed for seven consecutive years were transferred to the fund as per the requirements of the IEPF Rules. The Members are requested to check the details of the unpaid dividend on the website of the Company and claim their dividend to avoid the shares from being transferred to IEPF.

MANAGERIAL REMUNERATION

Disclosures of the ratio of the remuneration of each director to the median employee’s remuneration and other details as required pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of

Managerial Personnel) Rules, 2014 as amended from time to time, are provided as "Annexure V”. None of the Directors or the Managing Director & CEO of the Company received any remuneration or commission from Subsidiary Companies of your Company.

The details of remuneration paid to the Directors including the Managing Director & CEO of the Company are provided in the Corporate Governance Report.

PARTICULARS OF EMPLOYEES

The information required under Section 197(12) of the Companies Act, 2013 ("the Act”) read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms part of this Report. However, pursuant to first proviso to Section 136(1) of the Act, this report is being sent to the Shareholders excluding the aforesaid information. Any shareholder interested in obtaining said information may write to the Company Secretary at the Registered Office / Corporate Office of the Company and the said information is open for inspection at the Registered Office of the Company.

POLICY ON PREVENTION OF SEXUAL HARASSMENT

Your Company has laid down the Prevention of Sexual Harassment (POSH) policy which is available on its website. The Company has zero tolerance on Sexual Harassment at workplace. During the year under review, there were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

The status of complaints received under POSH and redressed by the POSH Committee of the Company, during the Financial Year under review, are given below:

a) Number of complaints received during the year - 74

b) Number of complaints redressed during the year - 73@

c) Number of complaints pending for redressal as on March 31, 2023 - 3

@ - Includes 2 complaints received during the previous year and redressed during the year.

There are focused campaigns on the POSH policy within the Company and awareness drives that

take place. Furthermore, employees are required to undertake a mandatory certification on POSH to sensitize themselves and strengthen their awareness.

EMPLOYEE STOCK OPTION SCHEMES

During the year under review, there were no material changes in the Employee Stock Option Schemes (ESOPs) of the Company and the Schemes are in compliance with the SEBI Regulations on ESOPs.

As per Regulation 14 of Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021, the details of the ESOPs are uploaded on the website of the Company and can be accessed at https://insights.techmahindra. com/investors/details-of-esops-fy-2022-23.pdf

CORPORATE GOVERNANCE

A report on Corporate Governance covering among others composition of the Board of Directors, details of meetings of the Board and Committees along with a certificate for compliance with the conditions of Corporate Governance in accordance with the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, issued by the Statutory Auditors of the Company, forms part of this Annual Report.

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.

BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT (BRSR)

SEBI, vide its circular dated May 10, 2021, made BRSR mandatory for the top 1,000 listed companies (by market capitalization) with effect from the FY 2022-23. The Company voluntarily published BRSR for the Financial year 2021-22. The BRSR Report for the year 2022-23 is enclosed as part of this Annual Report.

In addition to the BRSR, the Integrated Annual Report of the Company provides an insight on the various ESG initiatives adopted by the Company. The ESG disclosures have been independently assured by KPMG.

COST RECORDS

Maintenance of cost records and requirement of cost audit as prescribed under the provisions of Section 148(1) of the Companies Act, 2013 are not applicable for the business activities of the Company.

RISK MANAGEMENT

The Risk Management Committee of the Board of Directors devised a Risk Management Policy and guides the operating management to identify risks, analyze their probability and impact and prepare mitigation plans. It periodically reviews the Risk Management Framework & Enterprise Risk Register which is presented by the Chief Risk Officer. The Company identifies all potential risks viz. economic, business, currency, operations, climate, governance, finance, cyber, business continuity etc. and prepares a mitigation plan for each of the risks. The elements of risk as identified by the Company with the impact and mitigation strategy are set out in the Management Discussion and Analysis Report.

ESTABLISHMENT OF VIGIL MECHANISM

The Company has laid down Whistle Blower Policy covering Vigil Mechanism with protective clauses for the Whistle Blowers. The Whistle Blower Policy is made available on the website of the Company.

DEPOSITS / LOANS & ADVANCES, GUARANTEES OR INVESTMENTS

The Company has not accepted any deposits from the public during the year under review. The particulars of loans/advances, guarantees and investments under Section 186 of the Companies Act, 2013 are given in the notes forming part of the Financial Statements.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All transactions entered with Related Parties as defined under Section 2(76) of the Companies Act, 2013 and Regulation 23 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, ("The Listing Regulations”), during the financial year under review were in the ordinary course of business and at an arm’s length pricing basis and do not attract the provisions of Section 188 of the Companies Act, 2013. There were no transactions with related parties in the Financial Year which conflicted with the interest of the Company and required compliance of the provisions of Regulation 23 of the Listing Regulations.

Suitable disclosure as required by the Indian Accounting Standards (Ind AS 24) has been made in the notes forming part of the Financial Statements.

The Company has formulated a policy on the Related Party Transactions and dealing with Related Party Transactions which has been uploaded on the website of the Company and can be accessed at https:// insights.techmahindra.com/investors/Related-Party-Transactions-Policy.pdf

The particulars of related party transactions in prescribed Form AOC - 2 are attached as ‘Annexure VI”. Pursuant to Regulation 23(9) of the Listing Regulations, your Company has filed half yearly report on Related Party Transactions with the stock exchanges.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars as prescribed under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 are provided in "Annexure VII” which forms part of this report.

CORPORATE SOCIAL RESPONSIBILITY

The CSR vision of the Company is "Empowerment through Education.”

In compliance with the guidelines prescribed under Section 135 of the Companies Act, 2013, your Company has constituted a Corporate Social Responsibility (CSR) Committee of the Board. The CSR policy, covering the Objectives, Focus Areas, Governance Structure Monitoring and Reporting Framework among others is approved by the Board of Directors. In accordance with the amendments made in Section 135 in January 2021, the CSR Policy has been duly revised and is available on the website of the Company and can be accessed at https://insights. techmahindra.com/investors/tml-csr-policy-23.pdf

The Company has spent more than 2% of the average net profits of the Company during the three immediately preceding Financial Years on CSR.

The Company’s social initiatives are mainly carried out by Tech Mahindra Foundation and Mahindra Educational Institutions, Section 8 (erstwhile Section 25) Companies promoted by the Company.

TECH MAHINDRA FOUNDATION (TMF) EDUCATION

The key initiatives taken by TMF in the arena of school education include:

ALL ROUND IMPROVEMENT IN SCHOOL EDUCATION (ARISE)

Tech Mahindra Foundation’s educational initiatives under ARISE are long-term school improvement programmes, in partnership with local governments and partner organisations. The Foundation in 2022-23 worked with 18 government primary & secondary schools to transform them into model schools of excellence. A total of 5,224 students were positively impacted under this programme, of which 2,832 were girls.

During the year, the Foundation expanded its work for children with special needs through its ARISE programme. This programme is a variant of ARISE in which children with special needs are provided chronic therapy as well as special education to help them lead more fulfilling lives. Through 32 projects, the programme enabled 4,829 children with special needs to become better learners with greater independence in managing their lives. The Foundation has taken up the provision of assistive technology for these children as an important value addition to its work in ARISE .

SHIKSHAANTAR

Shikshaantar, envisioned as a programme for enhancing the capacity of government school teachers, has emerged as an important programme in the education portfolio of the Foundation. TMF works with the Municipal Corporation of Delhi by running their In-Service Teacher Education Institutes. With the merger of the MCDs, TMF now has the responsibility of training teachers from close to 1,500 primary schools in Delhi. During the year under review, as many as 4,379 teachers were trained as part of Shikshaantar. This included specially designed modules for Digital Literacy, Child Safety, Cyber Security and Mental Health that were delivered to the teachers in a hybrid mode.

MOBILE SCIENCE LAB & ROBOTICS LAB

In order to increase the footprint of its work in Education and reach the unreached, TMF launched a unique initiative in 2019-20 - The Mobile Science Lab (MSL). For this, a Mahindra bus has been remodeled to become a science lab on wheels and has been travelling from school to school in East Delhi to provide STEM learning for children in grades 3 and 4 in these

schools. The MSL program benefitted as many as 6,861 students and 77 teachers throughout the year.

Following the success of the MSL program, TMF has also set up a Robotics Lab at one of its ARISE schools in Delhi which is an all-girls school. This lab was inaugurated in November 2022, and nearly 300 girls from this school are the potential beneficiaries.

EMPLOYABILITY

Skills-for-Market Training (SMART) is the Foundation’s flagship programme in employability. It is built on the vision of an educated, enabled and empowered India, and the belief that educated and skilled youth are the country’s true strength. The programme started with 3 Centres in 2012 and is currently running over 85 Centres at 10 locations across India. These include SMART Centres, SMART Centres (training for people with disabilities), and SMART-T Centres (training in technical trades).

In 2022-23, your Company trained 17,641 young women and men under its SMART program, of which, 1,303 were persons with disabilities. More than 70% of the graduates are placed in jobs across multiple industries upon successful completion of the training. The average salaries being earned by the graduates of the SMART program have been steadily rising and saw a 10% jump over the previous year.

The Foundation’s commitment to setting new benchmarks in skill development in India has been underscored by the setting up of Tech Mahindra SMART Academies, which provide the highest quality of skill training to youngsters in Healthcare and Digital Technologies. During FY 2022-23, 3,584 students were trained at the nine Academies that are now functional - 5 in Healthcare, 3 in Digital Technologies, and 1 in Logistics.

TMF’S OUTREACH INITIATIVES

In addition to all the core programs described above, Tech Mahindra Foundation is now also implementing several outreach projects in collaboration with various agencies. As part of these, the TMF team members are engaged in activities such as community health initiatives, teacher training, provision of content for other large-scale projects, etc. As part of such outreach projects, TMF supported 20,734 beneficiaries, taking the total tally of direct beneficiaries for the year to 61,995. This is nearly 50% more than the number of direct beneficiaries for FY 2021-22, which stood at 41,374.

MAHINDRA EDUCATIONAL INSTITUTIONS (MEI)

MEI - a not-for-profit, 100% subsidiary of the Company has set up Mahindra Ecole Centrale in August 2014 - through a collaborative venture between Mahindra Educational Institutions and Ecole Centrale of Paris, France (now known as Centrale Supelec) and the JNTU Hyderabad - to offer undergraduate engineering programs. Through this strong Indo-French Collaboration with Centrale Supelec and Industry connect with Tech Mahindra, MEC has emerged as a disruptive player in the field of Technical Education.

MEI has sponsored the setting up of Mahindra University to introduce diverse streams of education in addition to Engineering. Further the Engineering stream is being transitioned to Mahindra University.

MAHINDRA UNIVERSITY (MU)

Mahindra University ("MU”) (sponsored by Mahindra Educational Institutions, ("MEI”) - a not-for-profit, 100% subsidiary of Tech Mahindra), was notified on May 20, 2020 by the Government of Telangana vide The Telangana State Private Universities (Establishment and Regulation) Act, 2018 for "educating future citizens for and of a better world”.

The Ecole Centrale School of Engineering (ECSoE) currently runs various UG, PG and Ph.D. programs in cutting-edge engineering departments. ECSoE also launched a Centre for Life Sciences and offers courses in biotechnology and computational biology under it. The school plans to launch the 2.5 year integrated programs in Biotechnology & CSE for AY 2023-24.

Cornell University’s SC Johnson College of Business, an ivy league institution is the "Academic Partner” for School of Management. Mahindra University’s School of Management (MU - SoM) will benefit significantly from Cornell University’s expertise in curriculum development, faculty exchange programs including some specialty courses delivery by the Cornell faculty to Mahindra University students, as well as student immersion at Cornell. The School of Management currently conducts BBA, BA, E-MBA, and MBA (starting in 2023) programs.

The School of Law, Mahindra University, commenced operations in September 2021 in Hyderabad offering 5-year integrated programs in BA LL.B and BBA LL.B. It was founded on the philosophy of securing justice, equality, and service to all sections of society. With the needs of modern society evolving rapidly, there is a renewed focus on the importance of the discipline of

law. The School of Law will aim to make a difference to the legal profession and practice by providing a diverse, flexible curriculum and pedagogy, touching on several aspects of domestic and international law, while appraising the students of the latest trends in academia and practice. Starting 2022, the School of Law has launched a 3-year LLB (Hons) program and intend to launch a 6-year integrated B.Tech LLB course starting Academic Year 2023.

The University also plans to launch the following programs/schools for the Academic Year 2023-24:

1. School of Media

a. 4-year B.Tech. (Computation & Media)

b. 3-year BA (Digital Media & Communication)

2. School of Hotel Management

a. 3-year B.Sc. (Hospitality & Hotel Administration)

In the academic year 2022, a total of 2,971 students were studying under various programs across all schools and departments. The new admissions for academic year 2022 are 1,236 students of which 1,128 students are in various UG programs, including School of Management and School of Law, 22 students in the PG programs of School of Engineering and 86 students in the Ph.D programs across all the schools.

The Annual Report on CSR activities is provided as "Annexure VIII”.

SUSTAINABILITY

Your Company aligns closely with the Mahindra Group’s ambition to Rise: Be People positive, Planet positive, and Trust positive. The Company holistically embraces ever greater responsibility towards protecting the environment, empowering the society, and providing good governance.

Your Company’s strategy for creating long-term sustainable value is by improving, scaling, and transparently communicating our ecological, social, and economic impacts. Our strong governance framework led by the Board of Directors of your Company, who have oversight of the Company’s overall strategy and future direction and ensures the planning and implementation of environmental and social programs.

The Company’s holistic approach enables to drive sustainable impact in alignment with leading global frameworks, initiatives, and agendas committed to furthering sustainability such as the TCFD, SASB, GRI, as well as the Paris Agreement, the UNGC and the UN SDGs.

As a business, the Company recognizes the value of following the UN SDGs (Sustainable Development Goals) of People, Planet, Prosperity, and Partnership and continues to create value through initiatives that cater directly to these aspects of our performance.

People:

• Great place to work: Working to enhance our organizational culture by enabling our associates with access to advanced technologies, providing Learning & Development opportunities to help develop their skills and areas of expertise and providing them with robust career development programmes.

• Work-life balance: Providing feasible and flexible work-life balance and integration along with a range of associate-friendly policies and processes to reduce attrition.

• Diversity and inclusion: Ensuring that our organization continues to transcend into the realms of gender diversity and includes people with disabilities as well as people from the LGBTQIA community as part of being a socially responsible business.

• Employee engagement & recognition:

Ensuring our associates are engaged, feel valued, and recognized through a robust performance management system, a flexible system of working, and an extensive system of benefits and perquisites.

• Individual Social Responsibility: Encouraging associates to contribute to the society & environment and make these activities an integral part of their day-to-day activities.

Planet:

• Carbon neutrality and Net zero: Committing to carbon neutrality (2030) and Net zero (2035) by switching to renewable energy through on site installations and open access; improving energy efficiency through installation of LEDs, sensors; boosting green investments by

implementing Carbon Price; optimizing business travel by enabling virtual meetings; encouraging use of public transport and carpooling to reduce employee commute emissions; carbon sequestration through tree plantation; moving towards a low carbon economy by optimizing operations to ensure environmental protection.

• No waste to landfill: Installing Organic Waste Converters and vermicomposting plants at own campuses to convert food waste to manure, cutting down their transportation emissions and reducing waste to landfill.

• No to plastic: Maintaining plastic-free campuses and encouraging all stakeholders to use ecofriendly and biodegradable materials. Spreading awareness and initiating campaigns on preventing single-use plastic.

• Reduce, Reuse, Recycle, Recover: Implementing the process of Reduce, Reuse, Recycle and Recover across the value chain to limit waste and enable a circular economy.

• Being water positive: Improving water efficiency and increasing water savings by using water sensors, restrictors and water-efficient coolers, recycling wastewater through STPs, and recharging groundwater levels with Rainwater Harvesting Pits.

• Promoting Biodiversity: Protecting local flora and fauna across all our locations to ensure that we do not adversely impact biodiversity through our operations.

Prosperity:

• Innovation: Embracing technology and innovation by incorporating IoT, Blockchain, AI and Machine Learning to develop a portfolio of sustainable solutions that help reduce emissions and other negative impacts of climate change.

• Green solutions: Investing in Sustainability reporting solution (i.Sustain) and Climate Risk Management platforms, Smart grid, Microgrid-As-A-Service, Community Action Platform for Energy, Integrated Electric Vehicle Charging systems (IEVCS), Smart data hubs and Smart Cities for our Customers to reduce their carbon emissions.

• Connecting with customers: Embracing brand equity by connecting with our customers to address their current and future needs and ensuring customer satisfaction.

Partnership

• Learning and Sharing: Partnering with collaborators & partner companies to create an alliance ecosystem and supplement each other’s capabilities on joint projects. Collaborating with academia, businesses, NGOs, and governments to address some of the global challenges like health care, climate change, inequality, etc.

• Sustainable supply chain: Ensuring that we are in synch with our value chain in our commitment towards climate action and helping our suppliers follow the highest standards of sustainable and ethical best practices within their own organizations.

Tech Mahindra has drafted its Integrated Annual report in accordance with Global Reporting standards and frameworks with the data assured by a third party thus complying with the highest transparency standards.

The Company’s progress against the sustainability targets and metrics are disclosed in the externally assured Integrated reports available on the website of the company- https://www.techmahindra.com/en-in/ sustainability/

AWARDS AND RECOGNITION

Your Company continued its quest for excellence in its chosen area of business to emerge as a true global brand. Several awards and rankings continue to endorse your Company as a thought leader in the industry. A few of the prominent Awards / recognitions received by the Company during the Financial Year 2022-23 include:

• Tech Mahindra won several medals in the USA for its people practices- Brandon Hall HCM Excellence Awards, Stevie Awards for Great Employers and was also included in the 2023 Bloomberg Gender-Equality Index (GEI).

• Tech Mahindra Philippines was certified as a Great Place to Work.

• The Economic Times bestowed Tech Mahindra with several recognitions including Great Manager Awards (People Business), Human Capital Awards and ‘Best Organizations for Women’ (Femina).

• Tech Mahindra was also recognized by Avtar and Seramount as "Champions” in Most Inclusive Companies Index and "Top 10” in Best Companies for Women in India.

• Dun & Bradstreet India recognized Tech Mahindra as a top performer in the ESG Performance -Software and BPM sector.

• Tech Mahindra won Frost & Sullivan’s Technology Innovation Leadership Award 2022 for Metaverse Technology Services.

• Tech Mahindra was recognized among the Iconic brands at ET Iconic Brands 2022.

• TechM amplifAI0->^ is awarded "Cool Product or Service of the Year in Business 2022.” at the 12th Annual 2022 Business Excellence Awards by Globee® Business Awards.

• Tech Mahindra MEA was recognized for Ground-breaking products/services in Ecommerce at GITEX.

• Tech Mahindra was awarded ‘A’ rating in MSCI ESG ratings 2022.

• Tech Mahindra received the "Mahatma Award 2022 for Social Good & Impact - Decent Work and Economic Growth” for its SMART Program.

These awards are a reflection of the Company’s continued efforts in the fields of business, sustainability, human resource management and its sustained progress towards creating a better society for all.

ACKNOWLEDGEMENTS

Your directors place on records their appreciation for the contributions made by employees towards the success of your Company. Your directors gratefully acknowledge the co-operation and support received from the shareholders, customers, vendors, bankers, Regulatory and Governmental authorities in India and abroad.

For and on behalf of the Board

Anand G. Mahindra Place: Mumbai Chairman

Date: 15th June, 2023 (DIN: 00004695)

Note: The Board of Directors at its meeting held on April 27, 2023, had approved the financial statements for the financial year 2023 and the Director''s Report along with the Annexures. However, in view of the appointment of Mr. Mohit Joshi as Additional Director and Whole Time Director, the revised Director''s Report was approved by the Board at its Meeting held on June 15, 2023.

1

Interim Dividend (Special Dividend) for the Financial Year ended March 31, 2022 and Final Dividend for the Financial Year ended March 31, 2021


Mar 31, 2022

Your Directors present the Thirty Fifth Annual Report along with the audited accounts of your Company for the year ended March 31, 2022.

FINANCIAL RESULTS (STANDALONE)

('' in Million)

For the year ended March 31

2022

2021

Income

362,489

305,627

Profit Before Interest, Depreciation and Tax

70,081

62,521

Interest

(636)

(632)

Depreciation

(6,599)

(6,623)

Profit Before Tax

62,846

55,266

Provision for Taxation

(13,715)

(12,875)

Profit After Tax

49,131

42,391

Other Comprehensive Income

1,081

2,453

Balance brought forward from previous year

200,874

184,021

Profit available for appropriation

249,753

226,432

Equity Dividends (Including tax on dividend)

(43,624)1

(19,335)2

Transfer to retained earnings on account of options lapsed

74

96

Transferred to Special Economic Zone re-investment reserve (net of utilisation)

-

(6,319)

Transferred from Special Economic Zone re-investment reserve on utilization

6,348

-

Balance carried forward

212,551

200,874

1 Interim Dividend (Special Dividend) for the Financial Year ended March 31,2022 and Final Dividend for the Financial Year ended March 31,2021

2 Interim Dividend (Special Dividend) for the Financial Year ended March 31,2021 and Final Dividend for the Financial Year ended March 31,2020

SHARE CAPITAL

During the year under review, your Company allotted 3,573,412 equity shares on the exercise of stock options under various Employee Stock Option Schemes. Consequently, the issued, subscribed and paid-up equity share capital has increased from '' 4,841 million divided into 968,260,067 equity shares of '' 5/- each to '' 4,859 million divided into 971,833,479 equity shares of '' 5/- each.

BUSINESS PERFORMANCE / FINANCIAL OVERVIEW

Tech Mahindra lives by the philosophy of creating a connected world built on connected experiences. It thrives on change powered by the intelligent symphony of technology and humans, designing both meaningful and sustainable experiences. Your Company is strongly positioned to succeed in this new normal and deliver what’s NXT.NOW for its customers. The Company has a rare combination of connectivity and experience as its endowment which, along with


DIVIDEND

The Board of Directors on October 25, 2021 approved a special dividend of '' 15/- per share (i.e. 300%) on par value of '' 5/- each which was paid by the Company to the shareholders whose names appeared in the Register of Members as on November 5, 2021, being the record date for the payment of dividend. Your Directors are pleased to recommend a final dividend of '' 30/- per share (including a special dividend of '' 15/- per share) on par value of '' 5/- (i.e. 600%), payable to those Shareholders whose names appear in the Register of Members as on the Book Closure Date. Thus, the total dividend for the F Y 202122 will be '' 45/- per share (i.e. 900%) similar to the dividend of '' 45/- per share (i.e. 900%) paid for the Financial Year 2020-21.

Your Company has formulated a Dividend Policy which is disclosed on the website of the Company and can be accessed at https://insights.techmahindra.com/ investors/tml-dividend-distribution-policy.pdf

its big bets on Cloud and engineering, form the Company’s NXT.NOW strategy.

The main components of the NXT.NOW Strategy are:

Connectivity - Modernizing networks has been our legacy for more than 25 years, serving the top global wireless communication service providers.

Experience - The Company provides award-winning and industry-leading capabilities in human-centric design.

Cloud - The Company continues to invest in rapidly scaling its partnerships and is uniquely positioned to deliver on the promise of Cloud, AI, and cyber security for its customers.

Engineering - The Company is home to leading products and software capabilities, enabled by a network of global excellence centers and top engineering talent.

During the Financial Year ended on March 31, 2022, the Company’s revenues grew to '' 446,460 million on consolidated basis as against '' 378,551 million in the previous year - indicating a robust growth of 18%. The growth was broad based across geographies as both Americas and Europe contributed in line with overall revenue growth. The Company also saw healthy growth across business segments in CME and Enterprise verticals.

The EBITDA on consolidated basis for the Financial Year 2022 was '' 80,200 million, a growth of 17% over the previous year EBITDA of '' 68,470 million. The resultant EBITDA margins were in a similar range - 18% in FY 2022 as against 18.1% in FY 2021. The post-tax profit of the Company increased by 25.7% to '' 55,661 million in FY 2022 as against '' 44,280 million in FY 2021.

The Company saw robust demand for digital transformation services with focus on customer experience and cloud. The Company has seen new deal wins of over USD 3,000 million in the previous year indicating a healthy growth momentum across all business verticals. Your Company’s investments in Enterprise SaaS and Hi-tech capabilities will help it cater to increasing modernization demands from businesses in Financial Year 2023 and beyond.

ACQUISITIONS

Your company made the following acquisitions during the financial year 2021-22.

DIGITALONUS

The Company on May 7, 2021, acquired 100% of the share capital of DigitalOnUs Inc. through its wholly owned subsidiary company Tech Mahindra (Americas) Inc. at a consideration of USD 120 million including earnouts and retention bonus. The company is headquartered in California, USA and is focused on Cloud Native Development and Hybrid Cloud Automation Services. This acquisition helped your Company in enhancing capability in Cloud Native Engineering and positioned the Company to develop cutting-edge digital solutions for its customers.

EVENTUS SOLUTIONS GROUP

The Company on June 18, 2021, acquired 100% of the share capital of Eventus Solutions Group, LLC (Eventus) through its wholly owned subsidiary company Tech Mahindra (Americas) Inc. at a consideration of USD 44 million including earnouts. Eventus is headquartered in Denver, Colorado, USA and has strong consulting capability in customer experience (CX) and customer management and enabled your Company to build an industry leading consulting practice in BPS business.

BERIS CONSULTING GMBH

The Company on October 1, 2021, acquired 100% of the share capital of Beris Consulting GmbH (Beris) through its subsidiary Company Tech Mahindra GmbH at a consideration of EUR 7 million including earnouts. Beris has 125 employees and helps your Company to unlock the transformational growth in the IT and application space for the automotive industry as a result of industry trends such as EV, Sharing & Mobility. It will also help your Company to expand its presence, hone local expertise and client relationships in the German market.

INFOSTAR LLC

The Company acquired 100% of the share capital of Infostar LLC (Lodestone) through its wholly owned subsidiary company Tech Mahindra (Americas) Inc. on October 25, 2021 at a consideration of USD 105 million including earnouts. Lodestone is headquartered in California, USA and helps your company to bolster end to end digital product engineering capabilities across design, build and test by employing Lodestone’s expertise in data strategy and providing end to end product quality assurance across hardware, software and data layers.

WE MAKE WEBSITES

The Company acquired 100% of the share capital of We Make Websites, UK through its step-down

subsidiary company Born London Limited, UK on October 25, 2021 at a consideration of GBP 9.4 million. The company is headquartered in UK and its offerings include Custom Shopify App Development, focused Ecommerce Agency, Design & UX, re-platforming, SEO & Data Migration, Headless Commerce, CRO, Performance Enhancement, Payments & Checkout, Compliance, Accessibility and O2O strategy.

BRAINSCALE

The Company on November 17, 2021, acquired 100% of the equity shares in Brainscale Inc. (Brainscale) through its wholly owned subsidiary company Tech Mahindra (Americas) Inc. at a consideration of USD 28.8 million including earnouts. Brainscale has expertise in Cloud consulting, Cloud enablement, Application Development and Data Analytics, which will bolster your company’s consulting capabilities in the Cloud transformation space and will enable your Company to drive growth of Cloud related IT services.

ACTIVUS

The Company on December 3, 2021, acquired 100% of the equity shares in Activus Connect LLC and Activus Connect PR LLC (together called as Activus) through its wholly owned subsidiary company Tech Mahindra (Americas) Inc. at a consideration of USD 62 million including earnouts. Activus is headquartered in Florida USA and has 1750 employees and is in the business of remote customer experience and customer care solution. This acquisition will help improve your company’s capability in the work from home Customer Experience Management by employing unique delivery model and disruptive platform called Smart Virtual.

ALLYIS

The Company on December 31, 2021, acquired 100% of the equity shares in Green Investments LLC (Allyis) through its wholly owned subsidiary company Tech Mahindra (Americas) Inc. at a consideration of USD 122.4 million including retention bonus and earnouts. Allyis is headquartered in Seattle, USA and has presence in US, Romania, Costa-Rica and India. The Indian subsidiary was acquired by Tech Mahindra Limited, at a consideration of USD 2.6 million. Allyis offers Technology consulting and managed services that help Organizations to reduce costs, improve performance which would help your Company’s capabilities in digital experience solutions and engineering, cloud and automation, BI and Analytics and Technical Support services.

CTC

The Company on January 17, 2022, acquired 100% of the equity shares in Com Tech Co IT Limited (CTC) through its wholly owned subsidiary company Tech Mahindra London Limited at a consideration of EUR 310 million including earnouts. CTC has 720 employees and is a specialized digital engineering and outsourced product development organization with development centers in Latvia and Belarus. It offers high-end-digital engineering services to some of the largest insurance and reinsurance organisations globally. Your Company also acquired 25% equity shares each in SWFT Technologies and Surance Ltd which are early stage InsurTech SaaS ventures with a proven technology.

GEOMATIC.AI

The Company acquired 80% of the share capital of Geomatic.AI Pty Ltd, Australia through its wholly owned subsidiary company Tech Mahindra (Singapore) Pte. Ltd on February 15, 2022 at a consideration of A$6 million. Geomatic.AI is headquartered in Australia and its offerings include digital platforms led nonlinear growth in partnership with AusNet Services an Australian Energy & Utilities distributor and will build digital twins for linear assets leveraging Cloud, Drone and Mobility technologies in the Geospatial domain.

DETAILS OF SUBSIDIARIES / JOINT VENTURES / ASSOCIATE COMPANIES

The performance and financial position of the subsidiaries, associate and joint venture companies included in the consolidated financial statement is provided in accordance with the provisions of Section 129 read with Rule 5 of the Companies (Accounts) Rules, 2014 containing the salient features of the financial statement of the Company’s subsidiaries/joint ventures or associate companies in Form AOC - 1 in "Annexure I” to this report.

Pursuant to Rule 8(5)(iv) of the Companies (Accounts) Rules, 2014, the names of the companies which have been incorporated or ceased to be the subsidiaries, joint ventures or associate companies during the year are provided in "Annexure II” to this report. The Company is actively pursuing the initiative on the consolidation of its subsidiaries/branches to optimize the operational costs. During the year under review, your Company has closed/merged fourteen subsidiaries.

In terms of the provisions of Regulation 24 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations 2015, Tech Mahindra (Americas) Inc. is a wholly owned unlisted material subsidiary of the Company.

The policy for determining material subsidiaries formulated by the Board of Directors is disclosed on the website of the Company and can be accessed at https://insights.techmahindra.com/investors/Policy-For-Determining-Material-Subsidiaries.pdf

UPDATE ON MERGER

The Board of Directors at its meeting held on January 31, 2021 approved the Scheme of Merger of Tech Mahindra Business Services Ltd and Born Commerce Private Ltd with the Company. Accordingly, the companies filed the petitions before the Hon’ble National Company Law Tribunal (NCLT), Mumbai and Chennai Benches respectively. The petitions are pending for final hearing as on the date of this Report.

HUMAN RESOURCES

The employees of the Company are the most critical asset to your Company. The Company has taken several steps to protect, retain, and improve the competencies of these assets including:

Hiring: War for Talent

Your Company responded to the ‘Great Resignation’ by adopting many innovative practices such as remote hiring, hybrid working, productivity to the engagement of remote workforce. With no location constraints, your Company could hire diverse talent including stay-at-home women, retired professionals, Persons with Disabilities (PwDs), gig workers, and more. Through the NXT.Town program, your Company started small centres in Tier-II and Tier-III cities across India to proactively look beyond set boundaries and focus on skill-based hiring in emerging technologies. Your Company is also committed to diversifying talent hiring at global delivery centres to improve local customer connect. Your Company has restructured its referral and campus recruitment programs to actively encourage hiring at the ‘bottom of the pyramid’. The Digital RMG platform has helped your Company proactively hire based on forecasted demand through a custom-built applicant tracking system that allows collaborative hiring and improves the candidate experience.

Learning: Build v/s Buy Talent

At your Company, learning plays a strategic role in the achievement of business goals by facilitating upskilling and creating a future-ready workforce, all the while fulfilling its associates’ career aspirations. In order to enable end-to-end digital transformation for global customers, your Company is building skills and keeping its talent pool brimming with new-age technologies. By offering skill-based and accelerated career movement allowance through the Career Acceleration Policy, your Company is encouraging niche skilling, thus creating a win-win situation. Your Company has launched a Cloud Finishing School for creating project-ready talent in Cloud technologies to fulfil business needs. After the success of the EMBARK capability building program for Program Managers, your Company has started an Architect COE for solution and technical architects who work on digital transformation. In an effort to build a roster of young and diverse leadership, the Company has launched focused young leader and women leader programs, with an emphasis on deploying them into new roles once their learning journey is complete. The Company has also partnered with Harvard to offer bite-sized learning content via the Harvard Manager Mentor (HMM) SPARK platform. Your Company continues to leverage its #NAD Learn platform to create full-stack professionals through initiatives like fresher-skilling, project-skilling, future-skilling and bench-skilling (Competence to Deployment) to create future-ready talent, in line with its NXT.NOW philosophy.

Leadership: Extreme Ownership

The natural culture of empowerment at your Company was supercharged during the pandemic as associates took ownership for their deliverables and leaders at all levels were an integral part of the decision-making process. The Leadership team of the Company aims to imbibe the following atomic habits -alternate thinking, bias for action, closure over followup, data over emotions and extreme ownership. This was reinforced through the adoption of a real-time Performance Management Dashboard for the 300 talent-to-value business leaders whose continuous executive coaching and performance management was instrumental in your Company meeting its financial and strategic goals. Apart from coaching, the Leaders at the Company have also had the opportunity to experience new forms of learning with technology-enabled pedagogies like habit builders, qubit

thinking, cinema-based learning, gamification etc. The Company also launched the Leadership Retreat, an eight-day-long learn-as-you-work residential program to replenish the physical, emotional, cognitive, and social energies of mid and senior level leaders.

Performance: Outcome-Driven

Your Company launched the Annual Performance Feedback cycle in December 2021 and has completed its performance appraisal. Aspiring to build a culture where performance is enabled through feedback, managers have been trained to engage in better performance review dialogues with their direct reports and work on an outcome-based evaluation, rather than process or effort measurement. Your Company is creating a high-performance culture through hyper-personalized incentive plans. Your Company has a suite of incentive plans that are designed to create a strong alignment between individual wealth creation and organizational performance. In addition to broad-based incentive plans, your Company has also customized quarterly sprint incentives which create avenues for instant gratification for associates across the front, middle, back offices as well as enabling functions, thereby inculcating a spirit of collaboration. With platforms like Talex, #NAD Learn and a revamped job rotations policy, your Company continued to improve internal mobility.

Wellness: Holistic Wellbeing

The ‘Wellness Before Business’ mantra followed by your Company has ensured the collective well-being and safety of its entire ecosystem of stakeholders, including associates, customers, and partners. The Wealth of Wellness (WoW) program ensures preventive, personalized, and proactive holistic wellness across all 8 dimensions of wellness including physical, mental, emotional, and financial parameters. The Company has launched new policies like the Bereavement Support for Dependents (COVID Support) Policy, Sabbatical Leave Policy, and more in response to the unique challenges posed by the pandemic. Your Company also provided financial security and crucial support through the Associate Welfare Trust for 190 associates, disbursing '' 2.8 crores. To highlight the importance of physical well-being, your Company launched the Wellness 101 Challenge as well as the Run Anywhere virtual marathon to engage its associates who predominantly worked from home and encouraged them to reclaim their fitness. Mental well-being was prioritized through initiatives like the Mind Plan, People Care Manager Program and the Emotional Wellness Self-Assessment.

Pandemic: #ResolveToRise

#ResolveToRise was an organization-wide campaign by the Company, rallying associates to embrace the Rise credo and encouraging them to stay strong by sharing inspiring stories and initiatives from the ground, including COVID warriors assisting those in need, Company-led innovations using #TechForGood to help the most vulnerable, community-wide volunteering efforts, and more. During the pandemic, the Company also setup a COVID-19 Support Fund, providing much-needed relief to affected families, setting up oxygen plants and donating ambulances to charitable hospitals. Your Company also setup COVID care centres at five major locations to help both associates and the larger community. Through the SOS Seva, your Company helped patients access critical care including hospital beds, oxygen cylinders, oxygen concentrators, medicines, and plasma. Through a series of vaccination drives, your Company has encouraged protection and prevention, vaccinating associates, their family members, and other third-party staff.

Communication: Building Purpose

Through effective internal communications, your Company ensures that the connected purpose of the organisation is communicated to all associates, thus reiterating the core philosophy of the brand: creating a connected world with connected experiences. With hybrid working being the norm, your Company has made virtual connectedness a way of life through various digital initiatives that were purpose-led, peoplecentric, and performance-driven. Multiple mediums were used to reach out to associates including social media, e-chats, emailers, campaigns, screensavers and more. With a 360-degree-communication approach, your Company has built a culture that is based on celebration, positive change, and the credo of Rise which has resulted in a unifying pride for the Company - their #LoveToBeTechM.

Diversity: Being Yourself

Your Company considers ‘diversity of people’, ensuring ‘equitable opportunities’ and ‘inclusion at the workplace’ as an instrument of growth. This has reflected in the definition of the new vision statement of your Company. The earlier Vision 2021 was about fostering innovation and that comes from ‘diversity of thought’. The new Vision 2024 is about creating a purpose-led company. Your Company is committed to pursuing ‘Purpose beyond Profits’ by embedding Environmental, Social and Governance

Engagement: TechM CARES Survey

Your Company has taken active steps to build remote engagement by creating virtual ‘water-cooler’ moments and updating policies in line with the ‘new normal’. To ensure that associates were continuously engaged through the right channels and received the right information at the right time, your Company followed the 4C model - Connect, Collaborate, Career, and Celebrate. Associates have expressed their confidence and delight through the TechM CARES survey where your Company has secured an overall rating of 4.58/5 - the highest score in its history. This engagement score represents a 54 basis points increase over the last survey score of 4.04/5 and reinforces your Company’s commitment to create human-centered experiences for its associates.

QUALITY

The Company continues its focus on quality and strives to exceed customer expectations at all times. During the year, it continued to strengthen the implementation of Quality systems and upgraded various processes to comply with CMMI V 2.0 for both Dev and Services. The Organization is recently assessed at Level 5 maturity. Similarly it underwent various upgrade and re-certification audits for multiple standards during the year in order to meet client demands and enhance value delivery. The Company has Successfully re-certified, ISO 9001:2015 (Quality Management System), ISO 20000-1:2018 (Information Technology Service Management System), ISO 27001:2013 (Information Security Management System), ISO 27701:2019 (Privacy Information Management System), TL9000 R 6.2/ R5.7 (Quality Management Systems for Tele Communications industry), ISO 13485:2016 (Quality Management Systems for medical devices - scope of certification limited to medical devices business within Tech Mahindra), AS9100 Rev D (Standard for Aerospace domain - scope of certification limited to the aerospace business within Tech Mahindra), ISO 17025:2017 - Laboratory Quality Management Systems for device testing labs.

In addition to these, your Company also maintains its commitment to health, safety and environment by continually improving its processes in accordance with ISO 14001:2015 (Environmental Management System) and ISO 45001: 2018 (Occupational Health and Safety Assessment Series) standards. Your Company is also certified on ISO 22301:2012 (Societal Security and

(ESG) principles into its core strategy, thus creating a long-term positive impact on the planet and society while providing greater value for all its stakeholders. Improvements in Diversity, Equity and Inclusion practices is critical to improve the Social aspect of ESG, and hence your Company has defined a roadmap for improvements across the dimensions of Gender, Generation, People with Disabilities, the LGBTQ community as well as cultures and nationalities. This also links back to the stated objective of your Company to be human-centered by encouraging associates to bring their most authentic selves to work.

Recognition: People at the Core

While timely recognition is key to a happy workforce, your Company also prioritizes creating a culture of appreciation. Your Company’s robust digital platform ensures both recognition and appreciation with monetary and non-monetary rewards badges linked to redemption points. Your Company also encourages its associates to donate their reward points towards social causes and has an industryleading rewards penetration of approximately 40%. To celebrate achievements in the virtual world, your Company introduced the quarterly Spotlight awards and other timely sales- focused awards to reward growth, collaboration, and high-impact initiatives. Your Company also included associates’ family members to virtually felicitate both Long Service Awardees and ACERs (consistent performers for two years) for their outstanding contributions and commitment.

HR Digitization: Automation at every Step

Your Company has continued to invest in its flagship product, ‘Dove,’ for new joiners, enabling new capabilities for document submissions and personal information updates. Your Company has continued to enhance self-service capabilities for existing associates in diverse areas such as letter generation, work permits, automated approvals, and proactive notifications for key events. Your Company has adopted Office 365 as well as the Enate and UNO platforms to automate routine business transactions through BOTs. Your Company has also taken steps to improve the post-joining and pre-exit processes to improve communication as a step towards empowering associates with the right information. Your Company has also leveraged Artificial Intelligence/ Machine learning to build internal applications to provide associates with customer-like experiences.

Business Continuity Management System) and has a comprehensive Business Continuity and Disaster Recovery framework, to prevent potential business disruptions in the event of any disaster. The Company has processes that helped resume services to customer’s acceptable service levels. Automated Service Desk with SLAs for enabling business and Vulnerability Assessment and Penetration Testing Lab for secured corporate network operations are highlights that showcase the information security posture of the Organization.

During the second year of the pandemic, the entire quality management system was put to test with majority of the associates working from home. Complying with the Company’s security requirements, they were able to deliver services as per contractual commitments, leading to great customer satisfaction.

Tech Mahindra (IT Division) has been assessed for the implementation of high maturity business excellence practices at Mahindra Group (Services Sector). It has been assessed at TMW Maturity Stage 7 (on scale of 1-10 stages) of Mahindra Business Excellence Framework - The Mahindra Way. These certifications are testimony of the robustness of business processes and at large the quality culture imbibed in the organization.

Your Company has continued to strengthen the process for transforming Quality Assurance processes & delivery methods to adopt and strengthen Delivery excellence, Risk governance, and further enhance automation to enable quality delivery to the customer. Quality index which is a measure of quality of products and services delivery is institutionalized.

All these actions are being taken to ensure that the Company deliver as stated in its Quality Policy.

DIRECTORS

During the year under review, all Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Independent Directors have also given declaration of compliance with Rules 6(1) and 6(2) of the Companies (Appointment and Qualification of Directors) Rules, 2014, with respect to

their name appearing in the data bank of Independent Directors maintained by the Indian Institute of Corporate Affairs.

Pursuant to the provisions of Section 152(6)(c) of the Companies Act, 2013, Mr. C. P. Gurnani, Managing Director & CEO (DIN: 00018234) is liable to retire by rotation and offers himself for reappointment.

Further the term of Mr. C. P. Gurnani as Managing Director & CEO expires on August 9, 2022. The Board of Directors based on the recommendation of Nomination and Remuneration Committee considering the performance of the Managing Director & CEO over the last 10 years & his contribution to the growth of the Company approved and recommends the re-appointment of Mr. C. P. Gurnani as Managing Director & CEO for another term from August 10, 2022 upto December 19, 2023, which is his date of retirement from the Company, subject to the approval of shareholders at the ensuing Annual General Meeting.

Your Directors co-opted Ms. Penelope Fowler (DIN: 09591815) as an Additional Director with effect from May 13, 2022. The term of Ms. Fowler will end at the ensuing Annual General Meeting. As Ms. Penelope Fowler meets the criteria of an Independent Director, the Board recommends her appointment as an Independent Director for a period of 5 years for the approval of shareholders at the ensuing Annual General Meeting.

Mr. M. Damodaran (DIN: 00125299) has retired as an Independent Director of the Company with effect from March 31, 2022. Your Board places on record its sincere appreciation for the valuable contribution and timely guidance from Mr. M. Damodaran to the Company during his tenure.

In terms of Regulation 24(1) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations 2015, Mr. T. N. Manoharan, Lead Independent Director of the Company has been appointed as Director on the Board of Tech Mahindra (Americas) Inc., a wholly owned unlisted material subsidiary of the Company with effect from May 21, 2019.

In the opinion of the Board of Directors the Independent Directors have relevant proficiency, expertise and experience.

i. Policy on the appointment and removal of Directors, Key Managerial Personnel and Senior Management.

ii. Policy on remuneration to the Directors, Key Managerial Personnel and Senior Management and other Employees.

The extract of these two policies is provided in "Annexure III''

The policies are available on the website of the Company and can be accessed at https://insights. techmahindra.com/investors/Governance-Policies-including-remuneration-to-Directors-KMPS.pdf

SUCCESSION PLAN

In accordance with the principles of transparency and consistency, your Company has adopted governance policies for appointments, remuneration and evaluation of its Board of Directors, Key Managerial Personnel & Senior Management. In line with these Governance policies, the Company has established a formal Succession Planning Program for key managerial persons across the organization. The Board evaluates all such plans at a regular interval and institutes a formal program for filling any such critical position. The Board evaluates both internal and external candidates for such positions alongwith the recommendations of the Company. The Company also has a leadership development program where it identifies high potential managers, and trains them to take up the positions of higher responsibility. The Company has identified the second line of leadership, which provides stability to the business in any contingencies.

TRAINING

The Company has laid down a policy on the training of Independent Directors as part of its governance policies. The Senior Leadership of the Company periodically updates the Directors on regulatory changes, business strategy and the Company has laid down a policy on the training of Independent Directors as part of its governance policies. The Senior Leadership of the Company periodically updates the Directors on regulatory changes, business strategy and operations.

KEY MANAGERIAL PERSONNEL (KMP) Pursuant to provisions of Section 203 of the Companies Act, 2013, Mr. C. P Gurnani, Managing Director & Chief Executive Officer, Mr. Manoj Bhat, Chief Financial Officer (up to April 1, 2021), Mr. Milind Kulkarni,


FAMILIARISATION PROGRAMME

These programmes aim to provide insights into the Company to enable the Independent Directors to understand its business in depth and contribute significantly to the Company. The details of program for familiarisation of the Independent Directors with the Company are available on its website and can be accessed at https://insights.techmahindra.com/ investorsltml-familarisation-progarmmes-for-IDs.pdf

The Board members are also regularly updated on changes in statutory provisions like changes in Corporate Laws, SEBI Regulations, Taxation Laws and People related laws as applicable at the quarterly Board meetings. The Board members are also updated on the Risk universe applicable to the Company’s business. The MD & CEO of the Company had quarterly sessions with Board members sharing updates about the Company’s business strategy, operations and the key trends in the IT industry that are relevant to the Company. These updates help the Board members in keeping abreast of key changes and their impact on the Company.

BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and Regulation 19 read with Schedule II, Part D of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has devised a policy on evaluating the performance of the Board of Directors, the Chairman, Committees, and Individual Directors. The evaluation process was carried out through a web-based portal. The summary of the evaluation reports was presented to the respective Committees and the Board. The Directors had given a positive feedback on the overall functioning of the Committees and the Board. The suggestions made by the Directors in the evaluation process have been suitably incorporated in the processes.

NUMBER OF MEETINGS OF THE BOARD

The Board met four times during the Financial Year 2021-22. The meeting details are provided in Corporate Governance report that forms part of this Annual Report. The maximum interval between any two meetings did not exceed 120 days as prescribed in the Companies Act, 2013 and SEBI Listing Regulations.

POLICY ON DIRECTORS’ APPOINTMENT AND REMUNERATION

The Governance policies laid down by the Board of Directors of your Company include:

are adequate for ensuring the orderly and efficient conduct of the business, including adherence to the Company’s policies, the safe guarding of assets, the prevention and detection of frauds and errors, the accuracy and completeness of accounting records and timely preparation of reliable financial information.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS / PROCEEDINGS

There are no significant and material orders passed by the regulators or courts or tribunal impacting the going concern status and the Company’s operations in the future.

Further no application against the Company has been filed or is pending under the Insolvency and Bankruptcy Code, 2016, nor the Company has done any one time settlement with any Bank or Financial institutions.

STATUTORY AUDITORS

The members, in the 30th Annual General Meeting (AGM) held on August 1, 2017, appointed

M/s. B S R & Co. LLP, Chartered Accountants, [ICAI Firm’s Registration No. 101248W/W- 100022] as the Statutory Auditors of the Company, to hold office for a term of five years from the conclusion of the 30th AGM of the Company held in the Financial Year 2017-18 until the conclusion of the AGM of the Company for the Financial Year 2021- 22 on such remuneration as may be determined by the Board of Directors.

Pursuant to Section 139 of the Companies Act, 2013 the Statutory Auditors M/s. B S R & Co. LLP, Chartered Accountants have confirmed that they are eligible to continue as auditors.

In accordance with provision of Section 139 of the Companies Act, 2013 read with Rules framed thereunder, the Board of Directors of the Company on the recommendation of the Audit Committee, proposes appointment of M/s. B SR & Co. LLP, Chartered Accountants (ICAI Firm’s Registration No. 101248W/W - 100022) as Statutory Auditors of the Company to hold office from the conclusion of ensuing 35th AGM for a term of five consecutive years till the conclusion of 40th AGM. The appointment of M/s. B S R & Co. LLP as the statutory auditors of the Company is placed before the members for approval at the ensuing AGM.

As required under provision of Section 139(1) of the Companies Act, 2013 the Company has received a written consent from M/s. B S R & Co. LLP for their

Chief Financial Officer (w.e.f. April 2, 2021) and Mr. Anil Khatri, Company Secretary & Compliance Officer were the Key Managerial Personnel of the Company during the year under review. Mr. Milind Kulkarni will retire as Chief Financial Officer of the Company w.e.f. May 31, 2022 and Mr. Rohit Anand was appointed as Chief Financial Officer of the Company w.e.f. June 1, 2022.

DIRECTORS’ RESPONSIBILITY STATEMENT

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

i. in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

ii. they have, in the selection of the accounting policies, consulted the Statutory Auditors and these have been applied consistently and, reasonable and prudent judgments and estimates have been made so as to give a true and fair view of the state of affairs of the Company as at March 31, 2022 and of the profit of the Company for the year ended on that date;

iii. proper and sufficient care had been taken 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 other irregularities;

iv. the annual accounts have been prepared on a going concern basis;

v. they had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively;

vi. the proper systems to ensure compliance with the provisions of all applicable laws are in place and are adequate and operating effectively.

DETAILS WITH RESPECT TO ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS

The Company has internal financial controls which are adequate and were operating effectively. The controls appointment and a certificate to the effect that their appointment, if made, would be in accordance with the Companies Act, 2013 and the Rules framed thereunder and that they satisfy the criteria provided in Section 141 of the Companies Act, 2013 read with Rule 4(1) of the Companies (Audit and Auditors) Rules, 2014 and that they are not disqualified for appointment as statutory auditors of the Company.

There are no qualifications, reservations, adverse remarks or disclaimer made in the audit report for the Financial Year 2021-22.

SECRETARIAL AUDIT REPORT

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 had appointed Mr. Makarand Lele & Co., Practicing Company Secretary, Pune to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is available at ‘Annexure IV” to this report. There are no qualifications, reservations, adverse remarks or disclaimer made in the Secretarial Audit Report.

COMPLIANCE WITH SECRETARIAL STANDARDS

The Company has complied with the applicable Secretarial Standards.

ANNUAL RETURN

Pursuant to the provisions of Section 92(3) read with Section 134(3) (a) of the Companies Act, 2013, the Annual Return in Form MGT-7 is available on the website of the Company and can be accessed at https://insights.techmahindra.com/investors/mgt7-annual-return-2021-22.pdf

MANAGERIAL REMUNERATION

Disclosures of the ratio of the remuneration of each director to the median employee’s remuneration and other details as required pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended from time to time, are provided as "Annexure V”.

None of the directors or Managing Director & CEO of the Company, received any remuneration or commission from Subsidiary Companies of your Company.

The details of remuneration paid to the Directors including the Managing Director & CEO of the Company is provided in Corporate Governance Report.

PARTICULARS OF EMPLOYEES

The information required under Section 197(12) of the Companies Act, 2013 ("the Act”) read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms part of this Report. However, pursuant to first proviso to Section 136(1) of the Act, this Report is being sent to the Shareholders excluding the aforesaid information. Any shareholder interested in obtaining said information, may write to the Company Secretary at the Registered Office / Corporate Office of the Company and the said information is open for inspection at the Registered Office of the Company.

POLICY ON PREVENTION OF SEXUAL HARASSMENT

Your Company laid down the Prevention of Sexual Harassment (POSH) policy which is available on its website. The Company has zero tolerance on Sexual Harassment at workplace. During the year under review there were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

The status of complaints received under POSH and redressed by the POSH Committee of the Company, during the Financial Year under review, are given below:

a) Number of complaints received - 45

b) Number of complaints redressed - 43

c) Number of complaints pending - 2

There are focused campaigns on the POSH policy within the Company and awareness drives that take place with the help of its BPS teams. Furthermore, the employees are required to undertake a mandatory annual certification on POSH to sensitize themselves and strengthen their awareness.

EMPLOYEE STOCK OPTION SCHEMES

During the year under review, there were no material changes in the Employee Stock Option Schemes (ESOPs) of the Company and the Schemes are in compliance with the SEBI Regulations on ESOPs.

As per Regulation 14 of Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021, the details of the ESOPs are uploaded on the website of the Company and can be accessed at https://insights.techmahindra. com/investors/Details-of-ESOPs-FY-2021-22.pdf

CORPORATE GOVERNANCE

A report on Corporate Governance covering among others composition, details of meetings of the Board and Committees along with a certificate for compliance with the conditions of Corporate Governance in accordance with the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, issued by the Statutory Auditors of the Company, forms part of this Annual Report.

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.

COST RECORDS

Maintenance of cost records and requirement of cost audit as prescribed under the provisions of Section 148(1) of the Companies Act, 2013 are not applicable for the business activities of the Company.

RISK MANAGEMENT

The Risk Management Committee of the Board of Directors guides the operating management to identify risks, analyze their probability and impact and prepare mitigation plans. It periodically reviews the Risk Management Framework & Enterprise Risk Register which is presented by the Chief Risk Officer. The Company identifies all potential risks viz. economical, business, currency, operational, climate, governance, financial, cyber, business continuity etc. and prepares a mitigation plan for each of the risks. The elements of risk as identified by the Company with the impact and mitigation strategy are set out in the Management Discussion and Analysis Report (MDA).

ESTABLISHMENT OF VIGIL MECHANISM

The Company has laid down Whistle Blower Policy covering Vigil Mechanism with protective Clauses for the Whistle Blowers. The Whistle Blower Policy is made available on the website of the Company.

DEPOSITS / LOANS & ADVANCES, GUARANTEES OR INVESTMENTS

The Company has not accepted any deposits from the public during the year under review. The particulars of loans/advances, guarantees and investments under Section 186 of the Companies Act, 2013 are given in the notes forming part of the Financial Statements.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All transactions entered into with Related Parties as defined under Section 2(76) of the Companies Act, 2013 and Regulation 23 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, ("The Listing Regulations”), during the Financial Year under review were in the ordinary course of business and at an arm’s length pricing basis and do not attract the provisions of Section 188 of the Companies Act, 2013. There were no transactions with related parties in the Financial Year which were in conflict with the interest of the Company and requiring compliance of the provisions of Regulation 23 of the Listing Regulations.

Suitable disclosure as required by the Indian Accounting Standards (Ind AS 24) has been made in the notes forming part of the Financial Statements.

The Company has formulated a policy on the materiality of Related Party Transactions and dealing with Related Party Transactions which has been uploaded on the website of the Company and can be accessed at https://insights.techmahindra.com/investors/Related-Party-Transactions-Policy.pdf

The particulars of related party transactions in prescribed Form AOC - 2 are attached

as ‘Annexure VI”.

Pursuant to Regulation 23(9) of the Listing Regulations, your Company has filed half yearly report on Related Party Transactions with the stock exchanges.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars as prescribed under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 are provided in “Annexure VII” which forms part of this report.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

The CSR vision of the Company is "Empowerment through Education.”

In compliance with the guidelines prescribed under Section 135 of the Companies Act, 2013, your Company has constituted a Corporate Social Responsibility (CSR) Committee of the Board. The CSR policy, covering the Objectives, Focus Areas, Governance Structure Monitoring and Reporting Framework among others is approved by the Board of Directors. In accordance with the amendments made in Section 135 in January 2021, the CSR Policy has been duly revised and is available on the website of the Company and can be accessed at https://files. techmahindra.com/static/img/pdf/csr-policy-techm-v3-march2021.pdf

The Company has spent more than 2% of the average net profits of the Company during the three immediately preceding Financial Years on CSR.

The Company’s social initiatives are mainly carried out by Tech Mahindra Foundation and Mahindra Educational Institutions, Section 8 (erstwhile Section 25) Companies promoted by the Company.

TECH MAHINDRA FOUNDATION (TMF) EDUCATION

The key initiatives taken by TMF in the arena of school education include:

ALL ROUND IMPROVEMENT IN SCHOOL EDUCATION (ARISE)

Tech Mahindra Foundation’s educational initiatives under ARISE are long-term school improvement programmes, in partnership with local governments and partner organisations. The Foundation in 2021-22 worked with 18 government primary schools to transform them into model schools of excellence. A total of 4,928 students were positively impacted under this programme, of which 2,646 were girls.

During the year, the Foundation expanded its work for children with special needs through its ARISE programme. This programme is a variant of ARISE in which children with special needs are provided chronic therapy as well as special education to help them lead more fulfilling lives. Through 28 projects, the programme enabled 3,792 children with special needs to become better learners with greater independence in managing their lives. The Foundation is also working

with some of the most committed NGOs in the disability sector to positively impact even more children.

SHIKSHAANTAR

Shikshaantar, envisioned as a programme for enhancing capacity of government school teachers, has emerged as an important programme in the education portfolio of the Foundation. TMF works with the Municipal Corporations in East Delhi and North Delhi by running their In-Service Teacher Education Institutes and during the year under review, as many as 9,573 teachers were trained as part of this initiative. This included specially designed modules for Digital Literacy, Child Safety, Cyber Security and Mental Health that were delivered to the teachers through online sessions. Physical training sessions with teachers resumed in the last few months of the year.

MOBILE SCIENCE LAB

In order to increase the footprint of its work in Education and reach the unreached, TMF had launched a unique initiative in 2019-20. The Mobile Science Lab (MSL). For this, a Mahindra bus has been remodeled to become a science lab on wheels and has been travelling from school to school in East Delhi to provide STEM learning for children in grades 3 and 4 in these schools. The MSL program resumed its operations in 2021-22 after a break of over a year, and during the year, as many as 4,590 students and 99 teachers were benefitted.

EMPLOYABILITY

Skills-for-Market Training (SMART) is the Foundation’s flagship programme in employability. It is built on the vision of an educated, enabled and empowered India, and the belief that educated and skilled youth are the country’s true strength. The programme started with 3 Centres in 2012 and is currently running over 85 Centres at 11 locations across India. These include SMART Centres, SMART Centres (training for people with disabilities), and SMART-T Centres (training in technical trades).

In 2021-22, your Company trained 16,715 young women and men under its SMART program, of which, 1,529 were persons with disabilities. More than 70% of the graduates are placed in jobs across multiple industries upon successful completion of the training. The average salaries being earned by the graduates of the SMART program have been steadily rising and crossed the '' 12,000 per month mark for the first time.

The Foundation’s commitment to setting new benchmarks in skill development in India has been underscored by the setting up of Tech Mahindra SMART Academies, which provide the highest quality of skill training to youngsters in Healthcare and Digital Technologies. During FY 2021-22, 1,677 students were trained at the eight Academies that are now functional - 4 in Healthcare, 3 in Digital Technologies, and 1 in Logistics.

TMF’S WORK IN COVID RELIEF

As FY 2021-22 began, the country was swept by a severe second wave of COVID-19, devastating large sections of the population. Continuing the COVID relief operations of the previous year, Tech Mahindra Foundation reached out to some of the most marginalized and vulnerable communities

- distributing ration kits, cooked meals, medical equipment, masks and PPE kits. More significantly, the Foundation managed to donate 20 fully equipped ambulances and install 10 oxygen plants at various charitable hospitals. In all, the COVID relief efforts of the Foundation have impacted over 2.3 million lives in 17 States of India through a wide range of initiatives.

MAHINDRA EDUCATIONAL INSTITUTIONS (MEI)

MEI - a not-for-profit, 100% subsidiary of the Company has set up Mahindra Ecole Centrale in August 2014

- through a collaborative venture between Mahindra Educational Institutions and Ecole Centrale of Paris, France (now known as Centrale Supelec) and the JNTU Hyderabad - to offer undergraduate engineering programs. Through this strong Indo-French Collaboration with Centrale Supelec and Industry connect with Tech Mahindra, MEC has emerged as a disruptive player in the field of Technical Education.

MEI has sponsored the setting up of Mahindra University to introduce diverse streams of education in addition to Engineering.

MAHINDRA UNIVERSITY (MU)

Mahindra University ("MU”) (sponsored by Mahindra Educational Institutions, ("MEI”) - a not-for-profit, 100% subsidiary of Tech Mahindra), was notified on May 20, 2020 by the Government of Telangana vide The Telangana State Private Universities (Establishment and Regulation) Act, 2018. for "educating future citizens for and of a better world”.

In 2021-22, Mahindra University launched 3 new schools besides the existing Ecole Centrale School

of Engineering— School of Management, School of Law and Indira Mahindra School of Education. Each of these Schools will run UG, PG and Ph.D. programs. Further, the University has subsequently planned to launch School of Media & Liberal Arts and School of Design in the next 2 years.

Cornell University’s SC Johnson College of Business, an ivy league institution is the "Academic Partner” for School of Management. Mahindra University’s School of Management (MU - SoM) will benefit significantly from Cornell University’s expertise in curriculum development, faculty exchange programs including some specialty courses delivery by the Cornell faculty to Mahindra University students, as well as student immersion at Cornell.

The School of Law, Mahindra University, commenced operations in September 2021 in Hyderabad and was founded on the philosophy of securing justice, equality, and service to all sections of society. With the needs of modern society evolving rapidly, there is a renewed focus on the importance of the discipline of law. The School of Law will aim to make a difference to the legal profession and practice by providing a diverse, flexible curriculum and pedagogy, touching on several aspects of domestic and international law, while appraising the students of the latest trends in academia and practice.

Indira Mahindra School of Education (IMSE) commenced its academic activities in 2021, with the PhD program. IMSE’s vision is to be a focused training ground for the next generation of teachers and school leaders through study of education where both researchers and practitioners are developed for working in and on educational issues.

In the academic year 2021, a total of 817 students were admitted to the University - of which 757 students were in various UG programs, including School of Management and School of Law, 24 students in the PG programs of School of Engineering and 36 students in the Ph.D programs across all the schools.

The Annual Report on CSR activities is provided as "Annexure VIII”.

SUSTAINABILITY

Climate change, escalation of wars and the pandemic have forced the world to look at Sustainability as the savior of our existence. The impact of the present crises can be handled better if a Sustainable

• Being Net Zero: Committed to be Net zero well before 2040 through adoption of renewable energy, increasing the use of energy-efficient equipment & tools across operations, creating eco-design of services, optimizing the use of resources across operations and preserving the biodiversity of areas in which we operate.

• Saying No to plastic: Maintaining plastic-free campuses and encouraging associates and stakeholders to use eco-friendly & biodegradable materials. Spreading awareness and initiating campaigns on preventing single-use plastic.

• Reduce, Reuse, Recycle, Recover: Implement process of Reduce, Reuse, Recycle and Recover across the value chain to limit waste and enable a circular economy.

• Sustainable supply chain: Ensure our suppliers follow the highest standards of sustainable and ethical best practices; optimise logistics and transportation to reduce emissions.

• Work-life balance: Provide an assured career development path and a feasible and flexi work-life balance to our associates along with a range of associate-friendly policies and processes to reduce attrition.

• Fostering Diversity: Offering improved opportunities and increasing the number of women, members of the LGBQ community, and PwDs to promote a diverse culture in the organization.

• Employee engagement and recognition:

Working diligently towards Employee engagement and increasing the number of employees recognized every year.

• Innovation: Becoming future-ready by proactively encouraging Innovative thinking across the organization, adopting technology disruption, and going digital to reduce emissions. Incorporating technologies such as loT, Blockchain, AI and Machine Learning to develop a portfolio of sustainable solutions that help reduce emissions and other negative impacts of climate change.

• Green solutions: Investing in Smart grid, Microgrid-As-A-Service, Community Action

business strategy is adopted by organizations globally. Sustainability must become an integral part of business strategy and management to ensure business continuity and profitable growth.

Being forerunners in the sustainability space, Tech Mahindra’s long-term growth strategy has always had ESG principles embedded in its core to help mitigate risks and drive profitable growth. Adopting proactive strategies that are resilient in nature has been the key to our continued success. Sustainable transformation with a focus on low carbon future has helped us to quickly adapt to disruptive changes and leverage these capabilities towards business continuity and management. Tech Mahindra’s sustainability commitments across environmental, social and governance pillars span across all our business verticals and even extends to our value chain. Being an organization with purpose, we have delivered on our promise to run better, change faster and grow greater while also creating meaningful human experiences for all.

Tech Mahindra is sourcing renewable energy, using energy-efficient equipment, and optimizing operations to achieve ecological balance while investing in and pioneering new solutions for sustainable development. Tech Mahindra’s emphasis on ESG is seen in our commitment of achieving Carbon Neutrality by 2030 and being Net zero well-before 2040. We are making optimum use of resources, moving towards low-emission technologies, and taking 5-year targets for ensuring diversity, equality, and innovation, while also updating policies and procedures to maintain a robust and compliant governance.

Tech Mahindra is aligned towards the UN SDGs (Sustainable Development Goals) and its sustainability focus areas are as below:

• Going Carbon Neutral: Increasing use of renewable energy through onsite installations and open access; improving energy efficiency through installation of LEDs, sensors; boosting green investments by implementing Carbon Price; optimizing business travel by enabling virtual meetings; encouraging use of public transport and carpooling to reduce commute emissions; planting trees to offset carbon footprints; moving towards a low carbon economy to ensure environmental protection.

Platform for Energy, Integrated Electric Vehicle Charging systems (IEVCS), Smart data hubs and Smart Cities for our Customers to reduce their emissions.

• Individual Social Responsibility: encouraging associates to make sustainability a part of their day-to-day lives.

• Transparency: Reporting our organizational policies & practices, along with financial, environmental and social data in the Integrated Annual Report.

The recognitions received by Tech Mahindra are a validation of the performance towards the company’s commitments, the details of the awards & recognitions are included in Corporate Overview, kindly refer page no. 25 of this Annual Report.

The Integrated Annual Report is based on various global standards and frameworks such as TCFD (Taskforce on Climate Related Financial Disclosures), CDSB (Climate Disclosure Standards Board), SASB (Sustainability Accounting Standard Board) and GRI standards and assured by third party according to ISAE (International Standard on Assurance Engagement) 3000 standards.

Tech Mahindra discloses climate-related risks and opportunities in line with the recommendations of TCFD which focusses on the financial impact of climate-related changes on our operations.

The TechM Board owns all risks and opportunities. The MD & CEO of the Company chairs the CSR Committee of the Board and has the ultimate responsibility for Sustainability. He is ably supported by the Senior Management members of the Sustainability Council and the Chief Sustainability Officer who manage all aspects of climate change.

The pandemic has taught the Company some concrete lessons and new ways of management in order to thrive in the new post-pandemic world. Tech Mahindra has made good progress on its commitments to provide for a better and more sustainable future by embedding sustainability into its business strategy and ensuring economic recovery and business profitability. The Company strategy includes futureproofing our growth against impending

changes in policies and regulations and increasing our compliance readiness. Your Company are agile and adaptive to dynamic changes in internal and external intricacies with strategies in place to manage all business and ESG risks in an effective way. With a robust business continuity management framework and incident response team, the Company have ensured that we are resilient to any ESG risks.

The targets and the metrics used for managing climate-related & other risks and the progress against these targets are disclosed in the externally assured Integrated reports available on the website of the Company and can be accessed at https://www. techmahindra.com/en-in/sustainability/.

AWARDS AND RECOGNITION

Your Company continued its quest for excellence in its chosen area of business to emerge as a true global brand. Several awards and rankings continue to endorse your Company as a thought leader in the industry. Few of the Awards / recognitions received by the Company during the year 2021-22 include:

• Tech Mahindra recognized among the Economic Times Iconic Brands 2021.

• Tech Mahindra was declared winner of

NASSCOM Engineering & Innovation Excellence Awards 2021 for Service Delivery Excellence & Next-Gen Products for our projects on Vehicle Top Hats & Distributed Ledger DnD.

• Tech Mahindra listed among 2021 Best

Workplaces in Asia by Great Place to Work®.

• Tech Mahindra received HRH, The Prince

of Wales’ Terra Carta Seal in Recognition of the Company’s Commitment to Creating a Sustainable Future.

• Tech Mahindra won 3 Golds at the prestigious 2021 Stevie Awards for Great Employers.

• Tech Mahindra Recognized as the Fastest

Growing Organization in ‘Brand Strength’ by Brand Finance.

• Tech Mahindra emerges as the only Indian

company in the Forbes’ Blockchain 50.

• Mr. C. P. Gurnani has been recognized by The Economic Times among ‘Most Inspiring Business Leaders of Asia’ at The Economic Times 6th Edition Asia’s Promising Business Leaders.

• Tech Mahindra Included in Bloomberg Gender-Equality Index for Third Consecutive Year.

• Tech Mahindra was recognized for its pathbreaking sustainable efforts and was ranked 2nd amongst the Top 35 companies in Business world India’s Most Sustainable Companies 2022.

These awards are a reflection of the Company’s continued efforts in the fields of business, sustainability, human resource management and its sustained progress towards creating a better society for all.

ACKNOWLEDGEMENTS

Your Directors place on record their appreciation for the contributions made by employees towards the success of your Company more particularly ensuring business as usual in spite of the impact of COVID-19. Your Directors gratefully acknowledge the cooperation and support received from the shareholders, customers, vendors, bankers, regulatory and Governmental authorities in India and abroad.

For and on behalf of the Board

Anand G. Mahindra Place: Mumbai Chairman

Date: May 13, 2022 (DIN: 00004695)


Mar 31, 2022

Your Directors present the Thirty Fifth Annual Report along with the audited accounts of your Company for the year ended March 31, 2022.

FINANCIAL RESULTS (STANDALONE)

('' in Million)

For the year ended March 31

2022

2021

Income

362,489

305,627

Profit Before Interest, Depreciation and Tax

70,081

62,521

Interest

(636)

(632)

Depreciation

(6,599)

(6,623)

Profit Before Tax

62,846

55,266

Provision for Taxation

(13,715)

(12,875)

Profit After Tax

49,131

42,391

Other Comprehensive Income

1,081

2,453

Balance brought forward from previous year

200,874

184,021

Profit available for appropriation

249,753

226,432

Equity Dividends (Including tax on dividend)

(43,624)1

(19,335)2

Transfer to retained earnings on account of options lapsed

74

96

Transferred to Special Economic Zone re-investment reserve (net of utilisation)

-

(6,319)

Transferred from Special Economic Zone re-investment reserve on utilization

6,348

-

Balance carried forward

212,551

200,874

1 Interim Dividend (Special Dividend) for the Financial Year ended March 31,2022 and Final Dividend for the Financial Year ended March 31,2021

2 Interim Dividend (Special Dividend) for the Financial Year ended March 31,2021 and Final Dividend for the Financial Year ended March 31,2020

SHARE CAPITAL

During the year under review, your Company allotted 3,573,412 equity shares on the exercise of stock options under various Employee Stock Option Schemes. Consequently, the issued, subscribed and paid-up equity share capital has increased from '' 4,841 million divided into 968,260,067 equity shares of '' 5/- each to '' 4,859 million divided into 971,833,479 equity shares of '' 5/- each.

BUSINESS PERFORMANCE / FINANCIAL OVERVIEW

Tech Mahindra lives by the philosophy of creating a connected world built on connected experiences. It thrives on change powered by the intelligent symphony of technology and humans, designing both meaningful and sustainable experiences. Your Company is strongly positioned to succeed in this new normal and deliver what’s NXT.NOW for its customers. The Company has a rare combination of connectivity and experience as its endowment which, along with


DIVIDEND

The Board of Directors on October 25, 2021 approved a special dividend of '' 15/- per share (i.e. 300%) on par value of '' 5/- each which was paid by the Company to the shareholders whose names appeared in the Register of Members as on November 5, 2021, being the record date for the payment of dividend. Your Directors are pleased to recommend a final dividend of '' 30/- per share (including a special dividend of '' 15/- per share) on par value of '' 5/- (i.e. 600%), payable to those Shareholders whose names appear in the Register of Members as on the Book Closure Date. Thus, the total dividend for the F Y 202122 will be '' 45/- per share (i.e. 900%) similar to the dividend of '' 45/- per share (i.e. 900%) paid for the Financial Year 2020-21.

Your Company has formulated a Dividend Policy which is disclosed on the website of the Company and can be accessed at https://insights.techmahindra.com/ investors/tml-dividend-distribution-policy.pdf

its big bets on Cloud and engineering, form the Company’s NXT.NOW strategy.

The main components of the NXT.NOW Strategy are:

Connectivity - Modernizing networks has been our legacy for more than 25 years, serving the top global wireless communication service providers.

Experience - The Company provides award-winning and industry-leading capabilities in human-centric design.

Cloud - The Company continues to invest in rapidly scaling its partnerships and is uniquely positioned to deliver on the promise of Cloud, AI, and cyber security for its customers.

Engineering - The Company is home to leading products and software capabilities, enabled by a network of global excellence centers and top engineering talent.

During the Financial Year ended on March 31, 2022, the Company’s revenues grew to '' 446,460 million on consolidated basis as against '' 378,551 million in the previous year - indicating a robust growth of 18%. The growth was broad based across geographies as both Americas and Europe contributed in line with overall revenue growth. The Company also saw healthy growth across business segments in CME and Enterprise verticals.

The EBITDA on consolidated basis for the Financial Year 2022 was '' 80,200 million, a growth of 17% over the previous year EBITDA of '' 68,470 million. The resultant EBITDA margins were in a similar range - 18% in FY 2022 as against 18.1% in FY 2021. The post-tax profit of the Company increased by 25.7% to '' 55,661 million in FY 2022 as against '' 44,280 million in FY 2021.

The Company saw robust demand for digital transformation services with focus on customer experience and cloud. The Company has seen new deal wins of over USD 3,000 million in the previous year indicating a healthy growth momentum across all business verticals. Your Company’s investments in Enterprise SaaS and Hi-tech capabilities will help it cater to increasing modernization demands from businesses in Financial Year 2023 and beyond.

ACQUISITIONS

Your company made the following acquisitions during the financial year 2021-22.

DIGITALONUS

The Company on May 7, 2021, acquired 100% of the share capital of DigitalOnUs Inc. through its wholly owned subsidiary company Tech Mahindra (Americas) Inc. at a consideration of USD 120 million including earnouts and retention bonus. The company is headquartered in California, USA and is focused on Cloud Native Development and Hybrid Cloud Automation Services. This acquisition helped your Company in enhancing capability in Cloud Native Engineering and positioned the Company to develop cutting-edge digital solutions for its customers.

EVENTUS SOLUTIONS GROUP

The Company on June 18, 2021, acquired 100% of the share capital of Eventus Solutions Group, LLC (Eventus) through its wholly owned subsidiary company Tech Mahindra (Americas) Inc. at a consideration of USD 44 million including earnouts. Eventus is headquartered in Denver, Colorado, USA and has strong consulting capability in customer experience (CX) and customer management and enabled your Company to build an industry leading consulting practice in BPS business.

BERIS CONSULTING GMBH

The Company on October 1, 2021, acquired 100% of the share capital of Beris Consulting GmbH (Beris) through its subsidiary Company Tech Mahindra GmbH at a consideration of EUR 7 million including earnouts. Beris has 125 employees and helps your Company to unlock the transformational growth in the IT and application space for the automotive industry as a result of industry trends such as EV, Sharing & Mobility. It will also help your Company to expand its presence, hone local expertise and client relationships in the German market.

INFOSTAR LLC

The Company acquired 100% of the share capital of Infostar LLC (Lodestone) through its wholly owned subsidiary company Tech Mahindra (Americas) Inc. on October 25, 2021 at a consideration of USD 105 million including earnouts. Lodestone is headquartered in California, USA and helps your company to bolster end to end digital product engineering capabilities across design, build and test by employing Lodestone’s expertise in data strategy and providing end to end product quality assurance across hardware, software and data layers.

WE MAKE WEBSITES

The Company acquired 100% of the share capital of We Make Websites, UK through its step-down

subsidiary company Born London Limited, UK on October 25, 2021 at a consideration of GBP 9.4 million. The company is headquartered in UK and its offerings include Custom Shopify App Development, focused Ecommerce Agency, Design & UX, re-platforming, SEO & Data Migration, Headless Commerce, CRO, Performance Enhancement, Payments & Checkout, Compliance, Accessibility and O2O strategy.

BRAINSCALE

The Company on November 17, 2021, acquired 100% of the equity shares in Brainscale Inc. (Brainscale) through its wholly owned subsidiary company Tech Mahindra (Americas) Inc. at a consideration of USD 28.8 million including earnouts. Brainscale has expertise in Cloud consulting, Cloud enablement, Application Development and Data Analytics, which will bolster your company’s consulting capabilities in the Cloud transformation space and will enable your Company to drive growth of Cloud related IT services.

ACTIVUS

The Company on December 3, 2021, acquired 100% of the equity shares in Activus Connect LLC and Activus Connect PR LLC (together called as Activus) through its wholly owned subsidiary company Tech Mahindra (Americas) Inc. at a consideration of USD 62 million including earnouts. Activus is headquartered in Florida USA and has 1750 employees and is in the business of remote customer experience and customer care solution. This acquisition will help improve your company’s capability in the work from home Customer Experience Management by employing unique delivery model and disruptive platform called Smart Virtual.

ALLYIS

The Company on December 31, 2021, acquired 100% of the equity shares in Green Investments LLC (Allyis) through its wholly owned subsidiary company Tech Mahindra (Americas) Inc. at a consideration of USD 122.4 million including retention bonus and earnouts. Allyis is headquartered in Seattle, USA and has presence in US, Romania, Costa-Rica and India. The Indian subsidiary was acquired by Tech Mahindra Limited, at a consideration of USD 2.6 million. Allyis offers Technology consulting and managed services that help Organizations to reduce costs, improve performance which would help your Company’s capabilities in digital experience solutions and engineering, cloud and automation, BI and Analytics and Technical Support services.

CTC

The Company on January 17, 2022, acquired 100% of the equity shares in Com Tech Co IT Limited (CTC) through its wholly owned subsidiary company Tech Mahindra London Limited at a consideration of EUR 310 million including earnouts. CTC has 720 employees and is a specialized digital engineering and outsourced product development organization with development centers in Latvia and Belarus. It offers high-end-digital engineering services to some of the largest insurance and reinsurance organisations globally. Your Company also acquired 25% equity shares each in SWFT Technologies and Surance Ltd which are early stage InsurTech SaaS ventures with a proven technology.

GEOMATIC.AI

The Company acquired 80% of the share capital of Geomatic.AI Pty Ltd, Australia through its wholly owned subsidiary company Tech Mahindra (Singapore) Pte. Ltd on February 15, 2022 at a consideration of A$6 million. Geomatic.AI is headquartered in Australia and its offerings include digital platforms led nonlinear growth in partnership with AusNet Services an Australian Energy & Utilities distributor and will build digital twins for linear assets leveraging Cloud, Drone and Mobility technologies in the Geospatial domain.

DETAILS OF SUBSIDIARIES / JOINT VENTURES / ASSOCIATE COMPANIES

The performance and financial position of the subsidiaries, associate and joint venture companies included in the consolidated financial statement is provided in accordance with the provisions of Section 129 read with Rule 5 of the Companies (Accounts) Rules, 2014 containing the salient features of the financial statement of the Company’s subsidiaries/joint ventures or associate companies in Form AOC - 1 in "Annexure I” to this report.

Pursuant to Rule 8(5)(iv) of the Companies (Accounts) Rules, 2014, the names of the companies which have been incorporated or ceased to be the subsidiaries, joint ventures or associate companies during the year are provided in "Annexure II” to this report. The Company is actively pursuing the initiative on the consolidation of its subsidiaries/branches to optimize the operational costs. During the year under review, your Company has closed/merged fourteen subsidiaries.

In terms of the provisions of Regulation 24 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations 2015, Tech Mahindra (Americas) Inc. is a wholly owned unlisted material subsidiary of the Company.

The policy for determining material subsidiaries formulated by the Board of Directors is disclosed on the website of the Company and can be accessed at https://insights.techmahindra.com/investors/Policy-For-Determining-Material-Subsidiaries.pdf

UPDATE ON MERGER

The Board of Directors at its meeting held on January 31, 2021 approved the Scheme of Merger of Tech Mahindra Business Services Ltd and Born Commerce Private Ltd with the Company. Accordingly, the companies filed the petitions before the Hon’ble National Company Law Tribunal (NCLT), Mumbai and Chennai Benches respectively. The petitions are pending for final hearing as on the date of this Report.

HUMAN RESOURCES

The employees of the Company are the most critical asset to your Company. The Company has taken several steps to protect, retain, and improve the competencies of these assets including:

Hiring: War for Talent

Your Company responded to the ‘Great Resignation’ by adopting many innovative practices such as remote hiring, hybrid working, productivity to the engagement of remote workforce. With no location constraints, your Company could hire diverse talent including stay-at-home women, retired professionals, Persons with Disabilities (PwDs), gig workers, and more. Through the NXT.Town program, your Company started small centres in Tier-II and Tier-III cities across India to proactively look beyond set boundaries and focus on skill-based hiring in emerging technologies. Your Company is also committed to diversifying talent hiring at global delivery centres to improve local customer connect. Your Company has restructured its referral and campus recruitment programs to actively encourage hiring at the ‘bottom of the pyramid’. The Digital RMG platform has helped your Company proactively hire based on forecasted demand through a custom-built applicant tracking system that allows collaborative hiring and improves the candidate experience.

Learning: Build v/s Buy Talent

At your Company, learning plays a strategic role in the achievement of business goals by facilitating upskilling and creating a future-ready workforce, all the while fulfilling its associates’ career aspirations. In order to enable end-to-end digital transformation for global customers, your Company is building skills and keeping its talent pool brimming with new-age technologies. By offering skill-based and accelerated career movement allowance through the Career Acceleration Policy, your Company is encouraging niche skilling, thus creating a win-win situation. Your Company has launched a Cloud Finishing School for creating project-ready talent in Cloud technologies to fulfil business needs. After the success of the EMBARK capability building program for Program Managers, your Company has started an Architect COE for solution and technical architects who work on digital transformation. In an effort to build a roster of young and diverse leadership, the Company has launched focused young leader and women leader programs, with an emphasis on deploying them into new roles once their learning journey is complete. The Company has also partnered with Harvard to offer bite-sized learning content via the Harvard Manager Mentor (HMM) SPARK platform. Your Company continues to leverage its #NAD Learn platform to create full-stack professionals through initiatives like fresher-skilling, project-skilling, future-skilling and bench-skilling (Competence to Deployment) to create future-ready talent, in line with its NXT.NOW philosophy.

Leadership: Extreme Ownership

The natural culture of empowerment at your Company was supercharged during the pandemic as associates took ownership for their deliverables and leaders at all levels were an integral part of the decision-making process. The Leadership team of the Company aims to imbibe the following atomic habits -alternate thinking, bias for action, closure over followup, data over emotions and extreme ownership. This was reinforced through the adoption of a real-time Performance Management Dashboard for the 300 talent-to-value business leaders whose continuous executive coaching and performance management was instrumental in your Company meeting its financial and strategic goals. Apart from coaching, the Leaders at the Company have also had the opportunity to experience new forms of learning with technology-enabled pedagogies like habit builders, qubit

thinking, cinema-based learning, gamification etc. The Company also launched the Leadership Retreat, an eight-day-long learn-as-you-work residential program to replenish the physical, emotional, cognitive, and social energies of mid and senior level leaders.

Performance: Outcome-Driven

Your Company launched the Annual Performance Feedback cycle in December 2021 and has completed its performance appraisal. Aspiring to build a culture where performance is enabled through feedback, managers have been trained to engage in better performance review dialogues with their direct reports and work on an outcome-based evaluation, rather than process or effort measurement. Your Company is creating a high-performance culture through hyper-personalized incentive plans. Your Company has a suite of incentive plans that are designed to create a strong alignment between individual wealth creation and organizational performance. In addition to broad-based incentive plans, your Company has also customized quarterly sprint incentives which create avenues for instant gratification for associates across the front, middle, back offices as well as enabling functions, thereby inculcating a spirit of collaboration. With platforms like Talex, #NAD Learn and a revamped job rotations policy, your Company continued to improve internal mobility.

Wellness: Holistic Wellbeing

The ‘Wellness Before Business’ mantra followed by your Company has ensured the collective well-being and safety of its entire ecosystem of stakeholders, including associates, customers, and partners. The Wealth of Wellness (WoW) program ensures preventive, personalized, and proactive holistic wellness across all 8 dimensions of wellness including physical, mental, emotional, and financial parameters. The Company has launched new policies like the Bereavement Support for Dependents (COVID Support) Policy, Sabbatical Leave Policy, and more in response to the unique challenges posed by the pandemic. Your Company also provided financial security and crucial support through the Associate Welfare Trust for 190 associates, disbursing '' 2.8 crores. To highlight the importance of physical well-being, your Company launched the Wellness 101 Challenge as well as the Run Anywhere virtual marathon to engage its associates who predominantly worked from home and encouraged them to reclaim their fitness. Mental well-being was prioritized through initiatives like the Mind Plan, People Care Manager Program and the Emotional Wellness Self-Assessment.

Pandemic: #ResolveToRise

#ResolveToRise was an organization-wide campaign by the Company, rallying associates to embrace the Rise credo and encouraging them to stay strong by sharing inspiring stories and initiatives from the ground, including COVID warriors assisting those in need, Company-led innovations using #TechForGood to help the most vulnerable, community-wide volunteering efforts, and more. During the pandemic, the Company also setup a COVID-19 Support Fund, providing much-needed relief to affected families, setting up oxygen plants and donating ambulances to charitable hospitals. Your Company also setup COVID care centres at five major locations to help both associates and the larger community. Through the SOS Seva, your Company helped patients access critical care including hospital beds, oxygen cylinders, oxygen concentrators, medicines, and plasma. Through a series of vaccination drives, your Company has encouraged protection and prevention, vaccinating associates, their family members, and other third-party staff.

Communication: Building Purpose

Through effective internal communications, your Company ensures that the connected purpose of the organisation is communicated to all associates, thus reiterating the core philosophy of the brand: creating a connected world with connected experiences. With hybrid working being the norm, your Company has made virtual connectedness a way of life through various digital initiatives that were purpose-led, peoplecentric, and performance-driven. Multiple mediums were used to reach out to associates including social media, e-chats, emailers, campaigns, screensavers and more. With a 360-degree-communication approach, your Company has built a culture that is based on celebration, positive change, and the credo of Rise which has resulted in a unifying pride for the Company - their #LoveToBeTechM.

Diversity: Being Yourself

Your Company considers ‘diversity of people’, ensuring ‘equitable opportunities’ and ‘inclusion at the workplace’ as an instrument of growth. This has reflected in the definition of the new vision statement of your Company. The earlier Vision 2021 was about fostering innovation and that comes from ‘diversity of thought’. The new Vision 2024 is about creating a purpose-led company. Your Company is committed to pursuing ‘Purpose beyond Profits’ by embedding Environmental, Social and Governance

Engagement: TechM CARES Survey

Your Company has taken active steps to build remote engagement by creating virtual ‘water-cooler’ moments and updating policies in line with the ‘new normal’. To ensure that associates were continuously engaged through the right channels and received the right information at the right time, your Company followed the 4C model - Connect, Collaborate, Career, and Celebrate. Associates have expressed their confidence and delight through the TechM CARES survey where your Company has secured an overall rating of 4.58/5 - the highest score in its history. This engagement score represents a 54 basis points increase over the last survey score of 4.04/5 and reinforces your Company’s commitment to create human-centered experiences for its associates.

QUALITY

The Company continues its focus on quality and strives to exceed customer expectations at all times. During the year, it continued to strengthen the implementation of Quality systems and upgraded various processes to comply with CMMI V 2.0 for both Dev and Services. The Organization is recently assessed at Level 5 maturity. Similarly it underwent various upgrade and re-certification audits for multiple standards during the year in order to meet client demands and enhance value delivery. The Company has Successfully re-certified, ISO 9001:2015 (Quality Management System), ISO 20000-1:2018 (Information Technology Service Management System), ISO 27001:2013 (Information Security Management System), ISO 27701:2019 (Privacy Information Management System), TL9000 R 6.2/ R5.7 (Quality Management Systems for Tele Communications industry), ISO 13485:2016 (Quality Management Systems for medical devices - scope of certification limited to medical devices business within Tech Mahindra), AS9100 Rev D (Standard for Aerospace domain - scope of certification limited to the aerospace business within Tech Mahindra), ISO 17025:2017 - Laboratory Quality Management Systems for device testing labs.

In addition to these, your Company also maintains its commitment to health, safety and environment by continually improving its processes in accordance with ISO 14001:2015 (Environmental Management System) and ISO 45001: 2018 (Occupational Health and Safety Assessment Series) standards. Your Company is also certified on ISO 22301:2012 (Societal Security and

(ESG) principles into its core strategy, thus creating a long-term positive impact on the planet and society while providing greater value for all its stakeholders. Improvements in Diversity, Equity and Inclusion practices is critical to improve the Social aspect of ESG, and hence your Company has defined a roadmap for improvements across the dimensions of Gender, Generation, People with Disabilities, the LGBTQ community as well as cultures and nationalities. This also links back to the stated objective of your Company to be human-centered by encouraging associates to bring their most authentic selves to work.

Recognition: People at the Core

While timely recognition is key to a happy workforce, your Company also prioritizes creating a culture of appreciation. Your Company’s robust digital platform ensures both recognition and appreciation with monetary and non-monetary rewards badges linked to redemption points. Your Company also encourages its associates to donate their reward points towards social causes and has an industryleading rewards penetration of approximately 40%. To celebrate achievements in the virtual world, your Company introduced the quarterly Spotlight awards and other timely sales- focused awards to reward growth, collaboration, and high-impact initiatives. Your Company also included associates’ family members to virtually felicitate both Long Service Awardees and ACERs (consistent performers for two years) for their outstanding contributions and commitment.

HR Digitization: Automation at every Step

Your Company has continued to invest in its flagship product, ‘Dove,’ for new joiners, enabling new capabilities for document submissions and personal information updates. Your Company has continued to enhance self-service capabilities for existing associates in diverse areas such as letter generation, work permits, automated approvals, and proactive notifications for key events. Your Company has adopted Office 365 as well as the Enate and UNO platforms to automate routine business transactions through BOTs. Your Company has also taken steps to improve the post-joining and pre-exit processes to improve communication as a step towards empowering associates with the right information. Your Company has also leveraged Artificial Intelligence/ Machine learning to build internal applications to provide associates with customer-like experiences.

Business Continuity Management System) and has a comprehensive Business Continuity and Disaster Recovery framework, to prevent potential business disruptions in the event of any disaster. The Company has processes that helped resume services to customer’s acceptable service levels. Automated Service Desk with SLAs for enabling business and Vulnerability Assessment and Penetration Testing Lab for secured corporate network operations are highlights that showcase the information security posture of the Organization.

During the second year of the pandemic, the entire quality management system was put to test with majority of the associates working from home. Complying with the Company’s security requirements, they were able to deliver services as per contractual commitments, leading to great customer satisfaction.

Tech Mahindra (IT Division) has been assessed for the implementation of high maturity business excellence practices at Mahindra Group (Services Sector). It has been assessed at TMW Maturity Stage 7 (on scale of 1-10 stages) of Mahindra Business Excellence Framework - The Mahindra Way. These certifications are testimony of the robustness of business processes and at large the quality culture imbibed in the organization.

Your Company has continued to strengthen the process for transforming Quality Assurance processes & delivery methods to adopt and strengthen Delivery excellence, Risk governance, and further enhance automation to enable quality delivery to the customer. Quality index which is a measure of quality of products and services delivery is institutionalized.

All these actions are being taken to ensure that the Company deliver as stated in its Quality Policy.

DIRECTORS

During the year under review, all Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Independent Directors have also given declaration of compliance with Rules 6(1) and 6(2) of the Companies (Appointment and Qualification of Directors) Rules, 2014, with respect to

their name appearing in the data bank of Independent Directors maintained by the Indian Institute of Corporate Affairs.

Pursuant to the provisions of Section 152(6)(c) of the Companies Act, 2013, Mr. C. P. Gurnani, Managing Director & CEO (DIN: 00018234) is liable to retire by rotation and offers himself for reappointment.

Further the term of Mr. C. P. Gurnani as Managing Director & CEO expires on August 9, 2022. The Board of Directors based on the recommendation of Nomination and Remuneration Committee considering the performance of the Managing Director & CEO over the last 10 years & his contribution to the growth of the Company approved and recommends the re-appointment of Mr. C. P. Gurnani as Managing Director & CEO for another term from August 10, 2022 upto December 19, 2023, which is his date of retirement from the Company, subject to the approval of shareholders at the ensuing Annual General Meeting.

Your Directors co-opted Ms. Penelope Fowler (DIN: 09591815) as an Additional Director with effect from May 13, 2022. The term of Ms. Fowler will end at the ensuing Annual General Meeting. As Ms. Penelope Fowler meets the criteria of an Independent Director, the Board recommends her appointment as an Independent Director for a period of 5 years for the approval of shareholders at the ensuing Annual General Meeting.

Mr. M. Damodaran (DIN: 00125299) has retired as an Independent Director of the Company with effect from March 31, 2022. Your Board places on record its sincere appreciation for the valuable contribution and timely guidance from Mr. M. Damodaran to the Company during his tenure.

In terms of Regulation 24(1) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations 2015, Mr. T. N. Manoharan, Lead Independent Director of the Company has been appointed as Director on the Board of Tech Mahindra (Americas) Inc., a wholly owned unlisted material subsidiary of the Company with effect from May 21, 2019.

In the opinion of the Board of Directors the Independent Directors have relevant proficiency, expertise and experience.

i. Policy on the appointment and removal of Directors, Key Managerial Personnel and Senior Management.

ii. Policy on remuneration to the Directors, Key Managerial Personnel and Senior Management and other Employees.

The extract of these two policies is provided in "Annexure III''

The policies are available on the website of the Company and can be accessed at https://insights. techmahindra.com/investors/Governance-Policies-including-remuneration-to-Directors-KMPS.pdf

SUCCESSION PLAN

In accordance with the principles of transparency and consistency, your Company has adopted governance policies for appointments, remuneration and evaluation of its Board of Directors, Key Managerial Personnel & Senior Management. In line with these Governance policies, the Company has established a formal Succession Planning Program for key managerial persons across the organization. The Board evaluates all such plans at a regular interval and institutes a formal program for filling any such critical position. The Board evaluates both internal and external candidates for such positions alongwith the recommendations of the Company. The Company also has a leadership development program where it identifies high potential managers, and trains them to take up the positions of higher responsibility. The Company has identified the second line of leadership, which provides stability to the business in any contingencies.

TRAINING

The Company has laid down a policy on the training of Independent Directors as part of its governance policies. The Senior Leadership of the Company periodically updates the Directors on regulatory changes, business strategy and the Company has laid down a policy on the training of Independent Directors as part of its governance policies. The Senior Leadership of the Company periodically updates the Directors on regulatory changes, business strategy and operations.

KEY MANAGERIAL PERSONNEL (KMP) Pursuant to provisions of Section 203 of the Companies Act, 2013, Mr. C. P Gurnani, Managing Director & Chief Executive Officer, Mr. Manoj Bhat, Chief Financial Officer (up to April 1, 2021), Mr. Milind Kulkarni,


FAMILIARISATION PROGRAMME

These programmes aim to provide insights into the Company to enable the Independent Directors to understand its business in depth and contribute significantly to the Company. The details of program for familiarisation of the Independent Directors with the Company are available on its website and can be accessed at https://insights.techmahindra.com/ investorsltml-familarisation-progarmmes-for-IDs.pdf

The Board members are also regularly updated on changes in statutory provisions like changes in Corporate Laws, SEBI Regulations, Taxation Laws and People related laws as applicable at the quarterly Board meetings. The Board members are also updated on the Risk universe applicable to the Company’s business. The MD & CEO of the Company had quarterly sessions with Board members sharing updates about the Company’s business strategy, operations and the key trends in the IT industry that are relevant to the Company. These updates help the Board members in keeping abreast of key changes and their impact on the Company.

BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and Regulation 19 read with Schedule II, Part D of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has devised a policy on evaluating the performance of the Board of Directors, the Chairman, Committees, and Individual Directors. The evaluation process was carried out through a web-based portal. The summary of the evaluation reports was presented to the respective Committees and the Board. The Directors had given a positive feedback on the overall functioning of the Committees and the Board. The suggestions made by the Directors in the evaluation process have been suitably incorporated in the processes.

NUMBER OF MEETINGS OF THE BOARD

The Board met four times during the Financial Year 2021-22. The meeting details are provided in Corporate Governance report that forms part of this Annual Report. The maximum interval between any two meetings did not exceed 120 days as prescribed in the Companies Act, 2013 and SEBI Listing Regulations.

POLICY ON DIRECTORS’ APPOINTMENT AND REMUNERATION

The Governance policies laid down by the Board of Directors of your Company include:

are adequate for ensuring the orderly and efficient conduct of the business, including adherence to the Company’s policies, the safe guarding of assets, the prevention and detection of frauds and errors, the accuracy and completeness of accounting records and timely preparation of reliable financial information.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS / PROCEEDINGS

There are no significant and material orders passed by the regulators or courts or tribunal impacting the going concern status and the Company’s operations in the future.

Further no application against the Company has been filed or is pending under the Insolvency and Bankruptcy Code, 2016, nor the Company has done any one time settlement with any Bank or Financial institutions.

STATUTORY AUDITORS

The members, in the 30th Annual General Meeting (AGM) held on August 1, 2017, appointed

M/s. B S R & Co. LLP, Chartered Accountants, [ICAI Firm’s Registration No. 101248W/W- 100022] as the Statutory Auditors of the Company, to hold office for a term of five years from the conclusion of the 30th AGM of the Company held in the Financial Year 2017-18 until the conclusion of the AGM of the Company for the Financial Year 2021- 22 on such remuneration as may be determined by the Board of Directors.

Pursuant to Section 139 of the Companies Act, 2013 the Statutory Auditors M/s. B S R & Co. LLP, Chartered Accountants have confirmed that they are eligible to continue as auditors.

In accordance with provision of Section 139 of the Companies Act, 2013 read with Rules framed thereunder, the Board of Directors of the Company on the recommendation of the Audit Committee, proposes appointment of M/s. B SR & Co. LLP, Chartered Accountants (ICAI Firm’s Registration No. 101248W/W - 100022) as Statutory Auditors of the Company to hold office from the conclusion of ensuing 35th AGM for a term of five consecutive years till the conclusion of 40th AGM. The appointment of M/s. B S R & Co. LLP as the statutory auditors of the Company is placed before the members for approval at the ensuing AGM.

As required under provision of Section 139(1) of the Companies Act, 2013 the Company has received a written consent from M/s. B S R & Co. LLP for their

Chief Financial Officer (w.e.f. April 2, 2021) and Mr. Anil Khatri, Company Secretary & Compliance Officer were the Key Managerial Personnel of the Company during the year under review. Mr. Milind Kulkarni will retire as Chief Financial Officer of the Company w.e.f. May 31, 2022 and Mr. Rohit Anand was appointed as Chief Financial Officer of the Company w.e.f. June 1, 2022.

DIRECTORS’ RESPONSIBILITY STATEMENT

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

i. in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

ii. they have, in the selection of the accounting policies, consulted the Statutory Auditors and these have been applied consistently and, reasonable and prudent judgments and estimates have been made so as to give a true and fair view of the state of affairs of the Company as at March 31, 2022 and of the profit of the Company for the year ended on that date;

iii. proper and sufficient care had been taken 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 other irregularities;

iv. the annual accounts have been prepared on a going concern basis;

v. they had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively;

vi. the proper systems to ensure compliance with the provisions of all applicable laws are in place and are adequate and operating effectively.

DETAILS WITH RESPECT TO ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS

The Company has internal financial controls which are adequate and were operating effectively. The controls appointment and a certificate to the effect that their appointment, if made, would be in accordance with the Companies Act, 2013 and the Rules framed thereunder and that they satisfy the criteria provided in Section 141 of the Companies Act, 2013 read with Rule 4(1) of the Companies (Audit and Auditors) Rules, 2014 and that they are not disqualified for appointment as statutory auditors of the Company.

There are no qualifications, reservations, adverse remarks or disclaimer made in the audit report for the Financial Year 2021-22.

SECRETARIAL AUDIT REPORT

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 had appointed Mr. Makarand Lele & Co., Practicing Company Secretary, Pune to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is available at ‘Annexure IV” to this report. There are no qualifications, reservations, adverse remarks or disclaimer made in the Secretarial Audit Report.

COMPLIANCE WITH SECRETARIAL STANDARDS

The Company has complied with the applicable Secretarial Standards.

ANNUAL RETURN

Pursuant to the provisions of Section 92(3) read with Section 134(3) (a) of the Companies Act, 2013, the Annual Return in Form MGT-7 is available on the website of the Company and can be accessed at https://insights.techmahindra.com/investors/mgt7-annual-return-2021-22.pdf

MANAGERIAL REMUNERATION

Disclosures of the ratio of the remuneration of each director to the median employee’s remuneration and other details as required pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended from time to time, are provided as "Annexure V”.

None of the directors or Managing Director & CEO of the Company, received any remuneration or commission from Subsidiary Companies of your Company.

The details of remuneration paid to the Directors including the Managing Director & CEO of the Company is provided in Corporate Governance Report.

PARTICULARS OF EMPLOYEES

The information required under Section 197(12) of the Companies Act, 2013 ("the Act”) read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms part of this Report. However, pursuant to first proviso to Section 136(1) of the Act, this Report is being sent to the Shareholders excluding the aforesaid information. Any shareholder interested in obtaining said information, may write to the Company Secretary at the Registered Office / Corporate Office of the Company and the said information is open for inspection at the Registered Office of the Company.

POLICY ON PREVENTION OF SEXUAL HARASSMENT

Your Company laid down the Prevention of Sexual Harassment (POSH) policy which is available on its website. The Company has zero tolerance on Sexual Harassment at workplace. During the year under review there were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

The status of complaints received under POSH and redressed by the POSH Committee of the Company, during the Financial Year under review, are given below:

a) Number of complaints received - 45

b) Number of complaints redressed - 43

c) Number of complaints pending - 2

There are focused campaigns on the POSH policy within the Company and awareness drives that take place with the help of its BPS teams. Furthermore, the employees are required to undertake a mandatory annual certification on POSH to sensitize themselves and strengthen their awareness.

EMPLOYEE STOCK OPTION SCHEMES

During the year under review, there were no material changes in the Employee Stock Option Schemes (ESOPs) of the Company and the Schemes are in compliance with the SEBI Regulations on ESOPs.

As per Regulation 14 of Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021, the details of the ESOPs are uploaded on the website of the Company and can be accessed at https://insights.techmahindra. com/investors/Details-of-ESOPs-FY-2021-22.pdf

CORPORATE GOVERNANCE

A report on Corporate Governance covering among others composition, details of meetings of the Board and Committees along with a certificate for compliance with the conditions of Corporate Governance in accordance with the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, issued by the Statutory Auditors of the Company, forms part of this Annual Report.

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.

COST RECORDS

Maintenance of cost records and requirement of cost audit as prescribed under the provisions of Section 148(1) of the Companies Act, 2013 are not applicable for the business activities of the Company.

RISK MANAGEMENT

The Risk Management Committee of the Board of Directors guides the operating management to identify risks, analyze their probability and impact and prepare mitigation plans. It periodically reviews the Risk Management Framework & Enterprise Risk Register which is presented by the Chief Risk Officer. The Company identifies all potential risks viz. economical, business, currency, operational, climate, governance, financial, cyber, business continuity etc. and prepares a mitigation plan for each of the risks. The elements of risk as identified by the Company with the impact and mitigation strategy are set out in the Management Discussion and Analysis Report (MDA).

ESTABLISHMENT OF VIGIL MECHANISM

The Company has laid down Whistle Blower Policy covering Vigil Mechanism with protective Clauses for the Whistle Blowers. The Whistle Blower Policy is made available on the website of the Company.

DEPOSITS / LOANS & ADVANCES, GUARANTEES OR INVESTMENTS

The Company has not accepted any deposits from the public during the year under review. The particulars of loans/advances, guarantees and investments under Section 186 of the Companies Act, 2013 are given in the notes forming part of the Financial Statements.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All transactions entered into with Related Parties as defined under Section 2(76) of the Companies Act, 2013 and Regulation 23 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, ("The Listing Regulations”), during the Financial Year under review were in the ordinary course of business and at an arm’s length pricing basis and do not attract the provisions of Section 188 of the Companies Act, 2013. There were no transactions with related parties in the Financial Year which were in conflict with the interest of the Company and requiring compliance of the provisions of Regulation 23 of the Listing Regulations.

Suitable disclosure as required by the Indian Accounting Standards (Ind AS 24) has been made in the notes forming part of the Financial Statements.

The Company has formulated a policy on the materiality of Related Party Transactions and dealing with Related Party Transactions which has been uploaded on the website of the Company and can be accessed at https://insights.techmahindra.com/investors/Related-Party-Transactions-Policy.pdf

The particulars of related party transactions in prescribed Form AOC - 2 are attached

as ‘Annexure VI”.

Pursuant to Regulation 23(9) of the Listing Regulations, your Company has filed half yearly report on Related Party Transactions with the stock exchanges.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars as prescribed under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 are provided in “Annexure VII” which forms part of this report.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

The CSR vision of the Company is "Empowerment through Education.”

In compliance with the guidelines prescribed under Section 135 of the Companies Act, 2013, your Company has constituted a Corporate Social Responsibility (CSR) Committee of the Board. The CSR policy, covering the Objectives, Focus Areas, Governance Structure Monitoring and Reporting Framework among others is approved by the Board of Directors. In accordance with the amendments made in Section 135 in January 2021, the CSR Policy has been duly revised and is available on the website of the Company and can be accessed at https://files. techmahindra.com/static/img/pdf/csr-policy-techm-v3-march2021.pdf

The Company has spent more than 2% of the average net profits of the Company during the three immediately preceding Financial Years on CSR.

The Company’s social initiatives are mainly carried out by Tech Mahindra Foundation and Mahindra Educational Institutions, Section 8 (erstwhile Section 25) Companies promoted by the Company.

TECH MAHINDRA FOUNDATION (TMF) EDUCATION

The key initiatives taken by TMF in the arena of school education include:

ALL ROUND IMPROVEMENT IN SCHOOL EDUCATION (ARISE)

Tech Mahindra Foundation’s educational initiatives under ARISE are long-term school improvement programmes, in partnership with local governments and partner organisations. The Foundation in 2021-22 worked with 18 government primary schools to transform them into model schools of excellence. A total of 4,928 students were positively impacted under this programme, of which 2,646 were girls.

During the year, the Foundation expanded its work for children with special needs through its ARISE programme. This programme is a variant of ARISE in which children with special needs are provided chronic therapy as well as special education to help them lead more fulfilling lives. Through 28 projects, the programme enabled 3,792 children with special needs to become better learners with greater independence in managing their lives. The Foundation is also working

with some of the most committed NGOs in the disability sector to positively impact even more children.

SHIKSHAANTAR

Shikshaantar, envisioned as a programme for enhancing capacity of government school teachers, has emerged as an important programme in the education portfolio of the Foundation. TMF works with the Municipal Corporations in East Delhi and North Delhi by running their In-Service Teacher Education Institutes and during the year under review, as many as 9,573 teachers were trained as part of this initiative. This included specially designed modules for Digital Literacy, Child Safety, Cyber Security and Mental Health that were delivered to the teachers through online sessions. Physical training sessions with teachers resumed in the last few months of the year.

MOBILE SCIENCE LAB

In order to increase the footprint of its work in Education and reach the unreached, TMF had launched a unique initiative in 2019-20. The Mobile Science Lab (MSL). For this, a Mahindra bus has been remodeled to become a science lab on wheels and has been travelling from school to school in East Delhi to provide STEM learning for children in grades 3 and 4 in these schools. The MSL program resumed its operations in 2021-22 after a break of over a year, and during the year, as many as 4,590 students and 99 teachers were benefitted.

EMPLOYABILITY

Skills-for-Market Training (SMART) is the Foundation’s flagship programme in employability. It is built on the vision of an educated, enabled and empowered India, and the belief that educated and skilled youth are the country’s true strength. The programme started with 3 Centres in 2012 and is currently running over 85 Centres at 11 locations across India. These include SMART Centres, SMART Centres (training for people with disabilities), and SMART-T Centres (training in technical trades).

In 2021-22, your Company trained 16,715 young women and men under its SMART program, of which, 1,529 were persons with disabilities. More than 70% of the graduates are placed in jobs across multiple industries upon successful completion of the training. The average salaries being earned by the graduates of the SMART program have been steadily rising and crossed the '' 12,000 per month mark for the first time.

The Foundation’s commitment to setting new benchmarks in skill development in India has been underscored by the setting up of Tech Mahindra SMART Academies, which provide the highest quality of skill training to youngsters in Healthcare and Digital Technologies. During FY 2021-22, 1,677 students were trained at the eight Academies that are now functional - 4 in Healthcare, 3 in Digital Technologies, and 1 in Logistics.

TMF’S WORK IN COVID RELIEF

As FY 2021-22 began, the country was swept by a severe second wave of COVID-19, devastating large sections of the population. Continuing the COVID relief operations of the previous year, Tech Mahindra Foundation reached out to some of the most marginalized and vulnerable communities

- distributing ration kits, cooked meals, medical equipment, masks and PPE kits. More significantly, the Foundation managed to donate 20 fully equipped ambulances and install 10 oxygen plants at various charitable hospitals. In all, the COVID relief efforts of the Foundation have impacted over 2.3 million lives in 17 States of India through a wide range of initiatives.

MAHINDRA EDUCATIONAL INSTITUTIONS (MEI)

MEI - a not-for-profit, 100% subsidiary of the Company has set up Mahindra Ecole Centrale in August 2014

- through a collaborative venture between Mahindra Educational Institutions and Ecole Centrale of Paris, France (now known as Centrale Supelec) and the JNTU Hyderabad - to offer undergraduate engineering programs. Through this strong Indo-French Collaboration with Centrale Supelec and Industry connect with Tech Mahindra, MEC has emerged as a disruptive player in the field of Technical Education.

MEI has sponsored the setting up of Mahindra University to introduce diverse streams of education in addition to Engineering.

MAHINDRA UNIVERSITY (MU)

Mahindra University ("MU”) (sponsored by Mahindra Educational Institutions, ("MEI”) - a not-for-profit, 100% subsidiary of Tech Mahindra), was notified on May 20, 2020 by the Government of Telangana vide The Telangana State Private Universities (Establishment and Regulation) Act, 2018. for "educating future citizens for and of a better world”.

In 2021-22, Mahindra University launched 3 new schools besides the existing Ecole Centrale School

of Engineering— School of Management, School of Law and Indira Mahindra School of Education. Each of these Schools will run UG, PG and Ph.D. programs. Further, the University has subsequently planned to launch School of Media & Liberal Arts and School of Design in the next 2 years.

Cornell University’s SC Johnson College of Business, an ivy league institution is the "Academic Partner” for School of Management. Mahindra University’s School of Management (MU - SoM) will benefit significantly from Cornell University’s expertise in curriculum development, faculty exchange programs including some specialty courses delivery by the Cornell faculty to Mahindra University students, as well as student immersion at Cornell.

The School of Law, Mahindra University, commenced operations in September 2021 in Hyderabad and was founded on the philosophy of securing justice, equality, and service to all sections of society. With the needs of modern society evolving rapidly, there is a renewed focus on the importance of the discipline of law. The School of Law will aim to make a difference to the legal profession and practice by providing a diverse, flexible curriculum and pedagogy, touching on several aspects of domestic and international law, while appraising the students of the latest trends in academia and practice.

Indira Mahindra School of Education (IMSE) commenced its academic activities in 2021, with the PhD program. IMSE’s vision is to be a focused training ground for the next generation of teachers and school leaders through study of education where both researchers and practitioners are developed for working in and on educational issues.

In the academic year 2021, a total of 817 students were admitted to the University - of which 757 students were in various UG programs, including School of Management and School of Law, 24 students in the PG programs of School of Engineering and 36 students in the Ph.D programs across all the schools.

The Annual Report on CSR activities is provided as "Annexure VIII”.

SUSTAINABILITY

Climate change, escalation of wars and the pandemic have forced the world to look at Sustainability as the savior of our existence. The impact of the present crises can be handled better if a Sustainable

• Being Net Zero: Committed to be Net zero well before 2040 through adoption of renewable energy, increasing the use of energy-efficient equipment & tools across operations, creating eco-design of services, optimizing the use of resources across operations and preserving the biodiversity of areas in which we operate.

• Saying No to plastic: Maintaining plastic-free campuses and encouraging associates and stakeholders to use eco-friendly & biodegradable materials. Spreading awareness and initiating campaigns on preventing single-use plastic.

• Reduce, Reuse, Recycle, Recover: Implement process of Reduce, Reuse, Recycle and Recover across the value chain to limit waste and enable a circular economy.

• Sustainable supply chain: Ensure our suppliers follow the highest standards of sustainable and ethical best practices; optimise logistics and transportation to reduce emissions.

• Work-life balance: Provide an assured career development path and a feasible and flexi work-life balance to our associates along with a range of associate-friendly policies and processes to reduce attrition.

• Fostering Diversity: Offering improved opportunities and increasing the number of women, members of the LGBQ community, and PwDs to promote a diverse culture in the organization.

• Employee engagement and recognition:

Working diligently towards Employee engagement and increasing the number of employees recognized every year.

• Innovation: Becoming future-ready by proactively encouraging Innovative thinking across the organization, adopting technology disruption, and going digital to reduce emissions. Incorporating technologies such as loT, Blockchain, AI and Machine Learning to develop a portfolio of sustainable solutions that help reduce emissions and other negative impacts of climate change.

• Green solutions: Investing in Smart grid, Microgrid-As-A-Service, Community Action

business strategy is adopted by organizations globally. Sustainability must become an integral part of business strategy and management to ensure business continuity and profitable growth.

Being forerunners in the sustainability space, Tech Mahindra’s long-term growth strategy has always had ESG principles embedded in its core to help mitigate risks and drive profitable growth. Adopting proactive strategies that are resilient in nature has been the key to our continued success. Sustainable transformation with a focus on low carbon future has helped us to quickly adapt to disruptive changes and leverage these capabilities towards business continuity and management. Tech Mahindra’s sustainability commitments across environmental, social and governance pillars span across all our business verticals and even extends to our value chain. Being an organization with purpose, we have delivered on our promise to run better, change faster and grow greater while also creating meaningful human experiences for all.

Tech Mahindra is sourcing renewable energy, using energy-efficient equipment, and optimizing operations to achieve ecological balance while investing in and pioneering new solutions for sustainable development. Tech Mahindra’s emphasis on ESG is seen in our commitment of achieving Carbon Neutrality by 2030 and being Net zero well-before 2040. We are making optimum use of resources, moving towards low-emission technologies, and taking 5-year targets for ensuring diversity, equality, and innovation, while also updating policies and procedures to maintain a robust and compliant governance.

Tech Mahindra is aligned towards the UN SDGs (Sustainable Development Goals) and its sustainability focus areas are as below:

• Going Carbon Neutral: Increasing use of renewable energy through onsite installations and open access; improving energy efficiency through installation of LEDs, sensors; boosting green investments by implementing Carbon Price; optimizing business travel by enabling virtual meetings; encouraging use of public transport and carpooling to reduce commute emissions; planting trees to offset carbon footprints; moving towards a low carbon economy to ensure environmental protection.

Platform for Energy, Integrated Electric Vehicle Charging systems (IEVCS), Smart data hubs and Smart Cities for our Customers to reduce their emissions.

• Individual Social Responsibility: encouraging associates to make sustainability a part of their day-to-day lives.

• Transparency: Reporting our organizational policies & practices, along with financial, environmental and social data in the Integrated Annual Report.

The recognitions received by Tech Mahindra are a validation of the performance towards the company’s commitments, the details of the awards & recognitions are included in Corporate Overview, kindly refer page no. 25 of this Annual Report.

The Integrated Annual Report is based on various global standards and frameworks such as TCFD (Taskforce on Climate Related Financial Disclosures), CDSB (Climate Disclosure Standards Board), SASB (Sustainability Accounting Standard Board) and GRI standards and assured by third party according to ISAE (International Standard on Assurance Engagement) 3000 standards.

Tech Mahindra discloses climate-related risks and opportunities in line with the recommendations of TCFD which focusses on the financial impact of climate-related changes on our operations.

The TechM Board owns all risks and opportunities. The MD & CEO of the Company chairs the CSR Committee of the Board and has the ultimate responsibility for Sustainability. He is ably supported by the Senior Management members of the Sustainability Council and the Chief Sustainability Officer who manage all aspects of climate change.

The pandemic has taught the Company some concrete lessons and new ways of management in order to thrive in the new post-pandemic world. Tech Mahindra has made good progress on its commitments to provide for a better and more sustainable future by embedding sustainability into its business strategy and ensuring economic recovery and business profitability. The Company strategy includes futureproofing our growth against impending

changes in policies and regulations and increasing our compliance readiness. Your Company are agile and adaptive to dynamic changes in internal and external intricacies with strategies in place to manage all business and ESG risks in an effective way. With a robust business continuity management framework and incident response team, the Company have ensured that we are resilient to any ESG risks.

The targets and the metrics used for managing climate-related & other risks and the progress against these targets are disclosed in the externally assured Integrated reports available on the website of the Company and can be accessed at https://www. techmahindra.com/en-in/sustainability/.

AWARDS AND RECOGNITION

Your Company continued its quest for excellence in its chosen area of business to emerge as a true global brand. Several awards and rankings continue to endorse your Company as a thought leader in the industry. Few of the Awards / recognitions received by the Company during the year 2021-22 include:

• Tech Mahindra recognized among the Economic Times Iconic Brands 2021.

• Tech Mahindra was declared winner of

NASSCOM Engineering & Innovation Excellence Awards 2021 for Service Delivery Excellence & Next-Gen Products for our projects on Vehicle Top Hats & Distributed Ledger DnD.

• Tech Mahindra listed among 2021 Best

Workplaces in Asia by Great Place to Work®.

• Tech Mahindra received HRH, The Prince

of Wales’ Terra Carta Seal in Recognition of the Company’s Commitment to Creating a Sustainable Future.

• Tech Mahindra won 3 Golds at the prestigious 2021 Stevie Awards for Great Employers.

• Tech Mahindra Recognized as the Fastest

Growing Organization in ‘Brand Strength’ by Brand Finance.

• Tech Mahindra emerges as the only Indian

company in the Forbes’ Blockchain 50.

• Mr. C. P. Gurnani has been recognized by The Economic Times among ‘Most Inspiring Business Leaders of Asia’ at The Economic Times 6th Edition Asia’s Promising Business Leaders.

• Tech Mahindra Included in Bloomberg Gender-Equality Index for Third Consecutive Year.

• Tech Mahindra was recognized for its pathbreaking sustainable efforts and was ranked 2nd amongst the Top 35 companies in Business world India’s Most Sustainable Companies 2022.

These awards are a reflection of the Company’s continued efforts in the fields of business, sustainability, human resource management and its sustained progress towards creating a better society for all.

ACKNOWLEDGEMENTS

Your Directors place on record their appreciation for the contributions made by employees towards the success of your Company more particularly ensuring business as usual in spite of the impact of COVID-19. Your Directors gratefully acknowledge the cooperation and support received from the shareholders, customers, vendors, bankers, regulatory and Governmental authorities in India and abroad.

For and on behalf of the Board

Anand G. Mahindra Place: Mumbai Chairman

Date: May 13, 2022 (DIN: 00004695)


Mar 31, 2022

Your Directors present the Thirty Fifth Annual Report along with the audited accounts of your Company for the year ended March 31, 2022.

FINANCIAL RESULTS (STANDALONE)

('' in Million)

For the year ended March 31

2022

2021

Income

362,489

305,627

Profit Before Interest, Depreciation and Tax

70,081

62,521

Interest

(636)

(632)

Depreciation

(6,599)

(6,623)

Profit Before Tax

62,846

55,266

Provision for Taxation

(13,715)

(12,875)

Profit After Tax

49,131

42,391

Other Comprehensive Income

1,081

2,453

Balance brought forward from previous year

200,874

184,021

Profit available for appropriation

249,753

226,432

Equity Dividends (Including tax on dividend)

(43,624)1

(19,335)2

Transfer to retained earnings on account of options lapsed

74

96

Transferred to Special Economic Zone re-investment reserve (net of utilisation)

-

(6,319)

Transferred from Special Economic Zone re-investment reserve on utilization

6,348

-

Balance carried forward

212,551

200,874

1 Interim Dividend (Special Dividend) for the Financial Year ended March 31,2022 and Final Dividend for the Financial Year ended March 31,2021

2 Interim Dividend (Special Dividend) for the Financial Year ended March 31,2021 and Final Dividend for the Financial Year ended March 31,2020

SHARE CAPITAL

During the year under review, your Company allotted 3,573,412 equity shares on the exercise of stock options under various Employee Stock Option Schemes. Consequently, the issued, subscribed and paid-up equity share capital has increased from '' 4,841 million divided into 968,260,067 equity shares of '' 5/- each to '' 4,859 million divided into 971,833,479 equity shares of '' 5/- each.

BUSINESS PERFORMANCE / FINANCIAL OVERVIEW

Tech Mahindra lives by the philosophy of creating a connected world built on connected experiences. It thrives on change powered by the intelligent symphony of technology and humans, designing both meaningful and sustainable experiences. Your Company is strongly positioned to succeed in this new normal and deliver what’s NXT.NOW for its customers. The Company has a rare combination of connectivity and experience as its endowment which, along with


DIVIDEND

The Board of Directors on October 25, 2021 approved a special dividend of '' 15/- per share (i.e. 300%) on par value of '' 5/- each which was paid by the Company to the shareholders whose names appeared in the Register of Members as on November 5, 2021, being the record date for the payment of dividend. Your Directors are pleased to recommend a final dividend of '' 30/- per share (including a special dividend of '' 15/- per share) on par value of '' 5/- (i.e. 600%), payable to those Shareholders whose names appear in the Register of Members as on the Book Closure Date. Thus, the total dividend for the F Y 202122 will be '' 45/- per share (i.e. 900%) similar to the dividend of '' 45/- per share (i.e. 900%) paid for the Financial Year 2020-21.

Your Company has formulated a Dividend Policy which is disclosed on the website of the Company and can be accessed at https://insights.techmahindra.com/ investors/tml-dividend-distribution-policy.pdf

its big bets on Cloud and engineering, form the Company’s NXT.NOW strategy.

The main components of the NXT.NOW Strategy are:

Connectivity - Modernizing networks has been our legacy for more than 25 years, serving the top global wireless communication service providers.

Experience - The Company provides award-winning and industry-leading capabilities in human-centric design.

Cloud - The Company continues to invest in rapidly scaling its partnerships and is uniquely positioned to deliver on the promise of Cloud, AI, and cyber security for its customers.

Engineering - The Company is home to leading products and software capabilities, enabled by a network of global excellence centers and top engineering talent.

During the Financial Year ended on March 31, 2022, the Company’s revenues grew to '' 446,460 million on consolidated basis as against '' 378,551 million in the previous year - indicating a robust growth of 18%. The growth was broad based across geographies as both Americas and Europe contributed in line with overall revenue growth. The Company also saw healthy growth across business segments in CME and Enterprise verticals.

The EBITDA on consolidated basis for the Financial Year 2022 was '' 80,200 million, a growth of 17% over the previous year EBITDA of '' 68,470 million. The resultant EBITDA margins were in a similar range - 18% in FY 2022 as against 18.1% in FY 2021. The post-tax profit of the Company increased by 25.7% to '' 55,661 million in FY 2022 as against '' 44,280 million in FY 2021.

The Company saw robust demand for digital transformation services with focus on customer experience and cloud. The Company has seen new deal wins of over USD 3,000 million in the previous year indicating a healthy growth momentum across all business verticals. Your Company’s investments in Enterprise SaaS and Hi-tech capabilities will help it cater to increasing modernization demands from businesses in Financial Year 2023 and beyond.

ACQUISITIONS

Your company made the following acquisitions during the financial year 2021-22.

DIGITALONUS

The Company on May 7, 2021, acquired 100% of the share capital of DigitalOnUs Inc. through its wholly owned subsidiary company Tech Mahindra (Americas) Inc. at a consideration of USD 120 million including earnouts and retention bonus. The company is headquartered in California, USA and is focused on Cloud Native Development and Hybrid Cloud Automation Services. This acquisition helped your Company in enhancing capability in Cloud Native Engineering and positioned the Company to develop cutting-edge digital solutions for its customers.

EVENTUS SOLUTIONS GROUP

The Company on June 18, 2021, acquired 100% of the share capital of Eventus Solutions Group, LLC (Eventus) through its wholly owned subsidiary company Tech Mahindra (Americas) Inc. at a consideration of USD 44 million including earnouts. Eventus is headquartered in Denver, Colorado, USA and has strong consulting capability in customer experience (CX) and customer management and enabled your Company to build an industry leading consulting practice in BPS business.

BERIS CONSULTING GMBH

The Company on October 1, 2021, acquired 100% of the share capital of Beris Consulting GmbH (Beris) through its subsidiary Company Tech Mahindra GmbH at a consideration of EUR 7 million including earnouts. Beris has 125 employees and helps your Company to unlock the transformational growth in the IT and application space for the automotive industry as a result of industry trends such as EV, Sharing & Mobility. It will also help your Company to expand its presence, hone local expertise and client relationships in the German market.

INFOSTAR LLC

The Company acquired 100% of the share capital of Infostar LLC (Lodestone) through its wholly owned subsidiary company Tech Mahindra (Americas) Inc. on October 25, 2021 at a consideration of USD 105 million including earnouts. Lodestone is headquartered in California, USA and helps your company to bolster end to end digital product engineering capabilities across design, build and test by employing Lodestone’s expertise in data strategy and providing end to end product quality assurance across hardware, software and data layers.

WE MAKE WEBSITES

The Company acquired 100% of the share capital of We Make Websites, UK through its step-down

subsidiary company Born London Limited, UK on October 25, 2021 at a consideration of GBP 9.4 million. The company is headquartered in UK and its offerings include Custom Shopify App Development, focused Ecommerce Agency, Design & UX, re-platforming, SEO & Data Migration, Headless Commerce, CRO, Performance Enhancement, Payments & Checkout, Compliance, Accessibility and O2O strategy.

BRAINSCALE

The Company on November 17, 2021, acquired 100% of the equity shares in Brainscale Inc. (Brainscale) through its wholly owned subsidiary company Tech Mahindra (Americas) Inc. at a consideration of USD 28.8 million including earnouts. Brainscale has expertise in Cloud consulting, Cloud enablement, Application Development and Data Analytics, which will bolster your company’s consulting capabilities in the Cloud transformation space and will enable your Company to drive growth of Cloud related IT services.

ACTIVUS

The Company on December 3, 2021, acquired 100% of the equity shares in Activus Connect LLC and Activus Connect PR LLC (together called as Activus) through its wholly owned subsidiary company Tech Mahindra (Americas) Inc. at a consideration of USD 62 million including earnouts. Activus is headquartered in Florida USA and has 1750 employees and is in the business of remote customer experience and customer care solution. This acquisition will help improve your company’s capability in the work from home Customer Experience Management by employing unique delivery model and disruptive platform called Smart Virtual.

ALLYIS

The Company on December 31, 2021, acquired 100% of the equity shares in Green Investments LLC (Allyis) through its wholly owned subsidiary company Tech Mahindra (Americas) Inc. at a consideration of USD 122.4 million including retention bonus and earnouts. Allyis is headquartered in Seattle, USA and has presence in US, Romania, Costa-Rica and India. The Indian subsidiary was acquired by Tech Mahindra Limited, at a consideration of USD 2.6 million. Allyis offers Technology consulting and managed services that help Organizations to reduce costs, improve performance which would help your Company’s capabilities in digital experience solutions and engineering, cloud and automation, BI and Analytics and Technical Support services.

CTC

The Company on January 17, 2022, acquired 100% of the equity shares in Com Tech Co IT Limited (CTC) through its wholly owned subsidiary company Tech Mahindra London Limited at a consideration of EUR 310 million including earnouts. CTC has 720 employees and is a specialized digital engineering and outsourced product development organization with development centers in Latvia and Belarus. It offers high-end-digital engineering services to some of the largest insurance and reinsurance organisations globally. Your Company also acquired 25% equity shares each in SWFT Technologies and Surance Ltd which are early stage InsurTech SaaS ventures with a proven technology.

GEOMATIC.AI

The Company acquired 80% of the share capital of Geomatic.AI Pty Ltd, Australia through its wholly owned subsidiary company Tech Mahindra (Singapore) Pte. Ltd on February 15, 2022 at a consideration of A$6 million. Geomatic.AI is headquartered in Australia and its offerings include digital platforms led nonlinear growth in partnership with AusNet Services an Australian Energy & Utilities distributor and will build digital twins for linear assets leveraging Cloud, Drone and Mobility technologies in the Geospatial domain.

DETAILS OF SUBSIDIARIES / JOINT VENTURES / ASSOCIATE COMPANIES

The performance and financial position of the subsidiaries, associate and joint venture companies included in the consolidated financial statement is provided in accordance with the provisions of Section 129 read with Rule 5 of the Companies (Accounts) Rules, 2014 containing the salient features of the financial statement of the Company’s subsidiaries/joint ventures or associate companies in Form AOC - 1 in "Annexure I” to this report.

Pursuant to Rule 8(5)(iv) of the Companies (Accounts) Rules, 2014, the names of the companies which have been incorporated or ceased to be the subsidiaries, joint ventures or associate companies during the year are provided in "Annexure II” to this report. The Company is actively pursuing the initiative on the consolidation of its subsidiaries/branches to optimize the operational costs. During the year under review, your Company has closed/merged fourteen subsidiaries.

In terms of the provisions of Regulation 24 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations 2015, Tech Mahindra (Americas) Inc. is a wholly owned unlisted material subsidiary of the Company.

The policy for determining material subsidiaries formulated by the Board of Directors is disclosed on the website of the Company and can be accessed at https://insights.techmahindra.com/investors/Policy-For-Determining-Material-Subsidiaries.pdf

UPDATE ON MERGER

The Board of Directors at its meeting held on January 31, 2021 approved the Scheme of Merger of Tech Mahindra Business Services Ltd and Born Commerce Private Ltd with the Company. Accordingly, the companies filed the petitions before the Hon’ble National Company Law Tribunal (NCLT), Mumbai and Chennai Benches respectively. The petitions are pending for final hearing as on the date of this Report.

HUMAN RESOURCES

The employees of the Company are the most critical asset to your Company. The Company has taken several steps to protect, retain, and improve the competencies of these assets including:

Hiring: War for Talent

Your Company responded to the ‘Great Resignation’ by adopting many innovative practices such as remote hiring, hybrid working, productivity to the engagement of remote workforce. With no location constraints, your Company could hire diverse talent including stay-at-home women, retired professionals, Persons with Disabilities (PwDs), gig workers, and more. Through the NXT.Town program, your Company started small centres in Tier-II and Tier-III cities across India to proactively look beyond set boundaries and focus on skill-based hiring in emerging technologies. Your Company is also committed to diversifying talent hiring at global delivery centres to improve local customer connect. Your Company has restructured its referral and campus recruitment programs to actively encourage hiring at the ‘bottom of the pyramid’. The Digital RMG platform has helped your Company proactively hire based on forecasted demand through a custom-built applicant tracking system that allows collaborative hiring and improves the candidate experience.

Learning: Build v/s Buy Talent

At your Company, learning plays a strategic role in the achievement of business goals by facilitating upskilling and creating a future-ready workforce, all the while fulfilling its associates’ career aspirations. In order to enable end-to-end digital transformation for global customers, your Company is building skills and keeping its talent pool brimming with new-age technologies. By offering skill-based and accelerated career movement allowance through the Career Acceleration Policy, your Company is encouraging niche skilling, thus creating a win-win situation. Your Company has launched a Cloud Finishing School for creating project-ready talent in Cloud technologies to fulfil business needs. After the success of the EMBARK capability building program for Program Managers, your Company has started an Architect COE for solution and technical architects who work on digital transformation. In an effort to build a roster of young and diverse leadership, the Company has launched focused young leader and women leader programs, with an emphasis on deploying them into new roles once their learning journey is complete. The Company has also partnered with Harvard to offer bite-sized learning content via the Harvard Manager Mentor (HMM) SPARK platform. Your Company continues to leverage its #NAD Learn platform to create full-stack professionals through initiatives like fresher-skilling, project-skilling, future-skilling and bench-skilling (Competence to Deployment) to create future-ready talent, in line with its NXT.NOW philosophy.

Leadership: Extreme Ownership

The natural culture of empowerment at your Company was supercharged during the pandemic as associates took ownership for their deliverables and leaders at all levels were an integral part of the decision-making process. The Leadership team of the Company aims to imbibe the following atomic habits -alternate thinking, bias for action, closure over followup, data over emotions and extreme ownership. This was reinforced through the adoption of a real-time Performance Management Dashboard for the 300 talent-to-value business leaders whose continuous executive coaching and performance management was instrumental in your Company meeting its financial and strategic goals. Apart from coaching, the Leaders at the Company have also had the opportunity to experience new forms of learning with technology-enabled pedagogies like habit builders, qubit

thinking, cinema-based learning, gamification etc. The Company also launched the Leadership Retreat, an eight-day-long learn-as-you-work residential program to replenish the physical, emotional, cognitive, and social energies of mid and senior level leaders.

Performance: Outcome-Driven

Your Company launched the Annual Performance Feedback cycle in December 2021 and has completed its performance appraisal. Aspiring to build a culture where performance is enabled through feedback, managers have been trained to engage in better performance review dialogues with their direct reports and work on an outcome-based evaluation, rather than process or effort measurement. Your Company is creating a high-performance culture through hyper-personalized incentive plans. Your Company has a suite of incentive plans that are designed to create a strong alignment between individual wealth creation and organizational performance. In addition to broad-based incentive plans, your Company has also customized quarterly sprint incentives which create avenues for instant gratification for associates across the front, middle, back offices as well as enabling functions, thereby inculcating a spirit of collaboration. With platforms like Talex, #NAD Learn and a revamped job rotations policy, your Company continued to improve internal mobility.

Wellness: Holistic Wellbeing

The ‘Wellness Before Business’ mantra followed by your Company has ensured the collective well-being and safety of its entire ecosystem of stakeholders, including associates, customers, and partners. The Wealth of Wellness (WoW) program ensures preventive, personalized, and proactive holistic wellness across all 8 dimensions of wellness including physical, mental, emotional, and financial parameters. The Company has launched new policies like the Bereavement Support for Dependents (COVID Support) Policy, Sabbatical Leave Policy, and more in response to the unique challenges posed by the pandemic. Your Company also provided financial security and crucial support through the Associate Welfare Trust for 190 associates, disbursing '' 2.8 crores. To highlight the importance of physical well-being, your Company launched the Wellness 101 Challenge as well as the Run Anywhere virtual marathon to engage its associates who predominantly worked from home and encouraged them to reclaim their fitness. Mental well-being was prioritized through initiatives like the Mind Plan, People Care Manager Program and the Emotional Wellness Self-Assessment.

Pandemic: #ResolveToRise

#ResolveToRise was an organization-wide campaign by the Company, rallying associates to embrace the Rise credo and encouraging them to stay strong by sharing inspiring stories and initiatives from the ground, including COVID warriors assisting those in need, Company-led innovations using #TechForGood to help the most vulnerable, community-wide volunteering efforts, and more. During the pandemic, the Company also setup a COVID-19 Support Fund, providing much-needed relief to affected families, setting up oxygen plants and donating ambulances to charitable hospitals. Your Company also setup COVID care centres at five major locations to help both associates and the larger community. Through the SOS Seva, your Company helped patients access critical care including hospital beds, oxygen cylinders, oxygen concentrators, medicines, and plasma. Through a series of vaccination drives, your Company has encouraged protection and prevention, vaccinating associates, their family members, and other third-party staff.

Communication: Building Purpose

Through effective internal communications, your Company ensures that the connected purpose of the organisation is communicated to all associates, thus reiterating the core philosophy of the brand: creating a connected world with connected experiences. With hybrid working being the norm, your Company has made virtual connectedness a way of life through various digital initiatives that were purpose-led, peoplecentric, and performance-driven. Multiple mediums were used to reach out to associates including social media, e-chats, emailers, campaigns, screensavers and more. With a 360-degree-communication approach, your Company has built a culture that is based on celebration, positive change, and the credo of Rise which has resulted in a unifying pride for the Company - their #LoveToBeTechM.

Diversity: Being Yourself

Your Company considers ‘diversity of people’, ensuring ‘equitable opportunities’ and ‘inclusion at the workplace’ as an instrument of growth. This has reflected in the definition of the new vision statement of your Company. The earlier Vision 2021 was about fostering innovation and that comes from ‘diversity of thought’. The new Vision 2024 is about creating a purpose-led company. Your Company is committed to pursuing ‘Purpose beyond Profits’ by embedding Environmental, Social and Governance

Engagement: TechM CARES Survey

Your Company has taken active steps to build remote engagement by creating virtual ‘water-cooler’ moments and updating policies in line with the ‘new normal’. To ensure that associates were continuously engaged through the right channels and received the right information at the right time, your Company followed the 4C model - Connect, Collaborate, Career, and Celebrate. Associates have expressed their confidence and delight through the TechM CARES survey where your Company has secured an overall rating of 4.58/5 - the highest score in its history. This engagement score represents a 54 basis points increase over the last survey score of 4.04/5 and reinforces your Company’s commitment to create human-centered experiences for its associates.

QUALITY

The Company continues its focus on quality and strives to exceed customer expectations at all times. During the year, it continued to strengthen the implementation of Quality systems and upgraded various processes to comply with CMMI V 2.0 for both Dev and Services. The Organization is recently assessed at Level 5 maturity. Similarly it underwent various upgrade and re-certification audits for multiple standards during the year in order to meet client demands and enhance value delivery. The Company has Successfully re-certified, ISO 9001:2015 (Quality Management System), ISO 20000-1:2018 (Information Technology Service Management System), ISO 27001:2013 (Information Security Management System), ISO 27701:2019 (Privacy Information Management System), TL9000 R 6.2/ R5.7 (Quality Management Systems for Tele Communications industry), ISO 13485:2016 (Quality Management Systems for medical devices - scope of certification limited to medical devices business within Tech Mahindra), AS9100 Rev D (Standard for Aerospace domain - scope of certification limited to the aerospace business within Tech Mahindra), ISO 17025:2017 - Laboratory Quality Management Systems for device testing labs.

In addition to these, your Company also maintains its commitment to health, safety and environment by continually improving its processes in accordance with ISO 14001:2015 (Environmental Management System) and ISO 45001: 2018 (Occupational Health and Safety Assessment Series) standards. Your Company is also certified on ISO 22301:2012 (Societal Security and

(ESG) principles into its core strategy, thus creating a long-term positive impact on the planet and society while providing greater value for all its stakeholders. Improvements in Diversity, Equity and Inclusion practices is critical to improve the Social aspect of ESG, and hence your Company has defined a roadmap for improvements across the dimensions of Gender, Generation, People with Disabilities, the LGBTQ community as well as cultures and nationalities. This also links back to the stated objective of your Company to be human-centered by encouraging associates to bring their most authentic selves to work.

Recognition: People at the Core

While timely recognition is key to a happy workforce, your Company also prioritizes creating a culture of appreciation. Your Company’s robust digital platform ensures both recognition and appreciation with monetary and non-monetary rewards badges linked to redemption points. Your Company also encourages its associates to donate their reward points towards social causes and has an industryleading rewards penetration of approximately 40%. To celebrate achievements in the virtual world, your Company introduced the quarterly Spotlight awards and other timely sales- focused awards to reward growth, collaboration, and high-impact initiatives. Your Company also included associates’ family members to virtually felicitate both Long Service Awardees and ACERs (consistent performers for two years) for their outstanding contributions and commitment.

HR Digitization: Automation at every Step

Your Company has continued to invest in its flagship product, ‘Dove,’ for new joiners, enabling new capabilities for document submissions and personal information updates. Your Company has continued to enhance self-service capabilities for existing associates in diverse areas such as letter generation, work permits, automated approvals, and proactive notifications for key events. Your Company has adopted Office 365 as well as the Enate and UNO platforms to automate routine business transactions through BOTs. Your Company has also taken steps to improve the post-joining and pre-exit processes to improve communication as a step towards empowering associates with the right information. Your Company has also leveraged Artificial Intelligence/ Machine learning to build internal applications to provide associates with customer-like experiences.

Business Continuity Management System) and has a comprehensive Business Continuity and Disaster Recovery framework, to prevent potential business disruptions in the event of any disaster. The Company has processes that helped resume services to customer’s acceptable service levels. Automated Service Desk with SLAs for enabling business and Vulnerability Assessment and Penetration Testing Lab for secured corporate network operations are highlights that showcase the information security posture of the Organization.

During the second year of the pandemic, the entire quality management system was put to test with majority of the associates working from home. Complying with the Company’s security requirements, they were able to deliver services as per contractual commitments, leading to great customer satisfaction.

Tech Mahindra (IT Division) has been assessed for the implementation of high maturity business excellence practices at Mahindra Group (Services Sector). It has been assessed at TMW Maturity Stage 7 (on scale of 1-10 stages) of Mahindra Business Excellence Framework - The Mahindra Way. These certifications are testimony of the robustness of business processes and at large the quality culture imbibed in the organization.

Your Company has continued to strengthen the process for transforming Quality Assurance processes & delivery methods to adopt and strengthen Delivery excellence, Risk governance, and further enhance automation to enable quality delivery to the customer. Quality index which is a measure of quality of products and services delivery is institutionalized.

All these actions are being taken to ensure that the Company deliver as stated in its Quality Policy.

DIRECTORS

During the year under review, all Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Independent Directors have also given declaration of compliance with Rules 6(1) and 6(2) of the Companies (Appointment and Qualification of Directors) Rules, 2014, with respect to

their name appearing in the data bank of Independent Directors maintained by the Indian Institute of Corporate Affairs.

Pursuant to the provisions of Section 152(6)(c) of the Companies Act, 2013, Mr. C. P. Gurnani, Managing Director & CEO (DIN: 00018234) is liable to retire by rotation and offers himself for reappointment.

Further the term of Mr. C. P. Gurnani as Managing Director & CEO expires on August 9, 2022. The Board of Directors based on the recommendation of Nomination and Remuneration Committee considering the performance of the Managing Director & CEO over the last 10 years & his contribution to the growth of the Company approved and recommends the re-appointment of Mr. C. P. Gurnani as Managing Director & CEO for another term from August 10, 2022 upto December 19, 2023, which is his date of retirement from the Company, subject to the approval of shareholders at the ensuing Annual General Meeting.

Your Directors co-opted Ms. Penelope Fowler (DIN: 09591815) as an Additional Director with effect from May 13, 2022. The term of Ms. Fowler will end at the ensuing Annual General Meeting. As Ms. Penelope Fowler meets the criteria of an Independent Director, the Board recommends her appointment as an Independent Director for a period of 5 years for the approval of shareholders at the ensuing Annual General Meeting.

Mr. M. Damodaran (DIN: 00125299) has retired as an Independent Director of the Company with effect from March 31, 2022. Your Board places on record its sincere appreciation for the valuable contribution and timely guidance from Mr. M. Damodaran to the Company during his tenure.

In terms of Regulation 24(1) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations 2015, Mr. T. N. Manoharan, Lead Independent Director of the Company has been appointed as Director on the Board of Tech Mahindra (Americas) Inc., a wholly owned unlisted material subsidiary of the Company with effect from May 21, 2019.

In the opinion of the Board of Directors the Independent Directors have relevant proficiency, expertise and experience.

i. Policy on the appointment and removal of Directors, Key Managerial Personnel and Senior Management.

ii. Policy on remuneration to the Directors, Key Managerial Personnel and Senior Management and other Employees.

The extract of these two policies is provided in "Annexure III''

The policies are available on the website of the Company and can be accessed at https://insights. techmahindra.com/investors/Governance-Policies-including-remuneration-to-Directors-KMPS.pdf

SUCCESSION PLAN

In accordance with the principles of transparency and consistency, your Company has adopted governance policies for appointments, remuneration and evaluation of its Board of Directors, Key Managerial Personnel & Senior Management. In line with these Governance policies, the Company has established a formal Succession Planning Program for key managerial persons across the organization. The Board evaluates all such plans at a regular interval and institutes a formal program for filling any such critical position. The Board evaluates both internal and external candidates for such positions alongwith the recommendations of the Company. The Company also has a leadership development program where it identifies high potential managers, and trains them to take up the positions of higher responsibility. The Company has identified the second line of leadership, which provides stability to the business in any contingencies.

TRAINING

The Company has laid down a policy on the training of Independent Directors as part of its governance policies. The Senior Leadership of the Company periodically updates the Directors on regulatory changes, business strategy and the Company has laid down a policy on the training of Independent Directors as part of its governance policies. The Senior Leadership of the Company periodically updates the Directors on regulatory changes, business strategy and operations.

KEY MANAGERIAL PERSONNEL (KMP) Pursuant to provisions of Section 203 of the Companies Act, 2013, Mr. C. P Gurnani, Managing Director & Chief Executive Officer, Mr. Manoj Bhat, Chief Financial Officer (up to April 1, 2021), Mr. Milind Kulkarni,


FAMILIARISATION PROGRAMME

These programmes aim to provide insights into the Company to enable the Independent Directors to understand its business in depth and contribute significantly to the Company. The details of program for familiarisation of the Independent Directors with the Company are available on its website and can be accessed at https://insights.techmahindra.com/ investorsltml-familarisation-progarmmes-for-IDs.pdf

The Board members are also regularly updated on changes in statutory provisions like changes in Corporate Laws, SEBI Regulations, Taxation Laws and People related laws as applicable at the quarterly Board meetings. The Board members are also updated on the Risk universe applicable to the Company’s business. The MD & CEO of the Company had quarterly sessions with Board members sharing updates about the Company’s business strategy, operations and the key trends in the IT industry that are relevant to the Company. These updates help the Board members in keeping abreast of key changes and their impact on the Company.

BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and Regulation 19 read with Schedule II, Part D of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has devised a policy on evaluating the performance of the Board of Directors, the Chairman, Committees, and Individual Directors. The evaluation process was carried out through a web-based portal. The summary of the evaluation reports was presented to the respective Committees and the Board. The Directors had given a positive feedback on the overall functioning of the Committees and the Board. The suggestions made by the Directors in the evaluation process have been suitably incorporated in the processes.

NUMBER OF MEETINGS OF THE BOARD

The Board met four times during the Financial Year 2021-22. The meeting details are provided in Corporate Governance report that forms part of this Annual Report. The maximum interval between any two meetings did not exceed 120 days as prescribed in the Companies Act, 2013 and SEBI Listing Regulations.

POLICY ON DIRECTORS’ APPOINTMENT AND REMUNERATION

The Governance policies laid down by the Board of Directors of your Company include:

are adequate for ensuring the orderly and efficient conduct of the business, including adherence to the Company’s policies, the safe guarding of assets, the prevention and detection of frauds and errors, the accuracy and completeness of accounting records and timely preparation of reliable financial information.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS / PROCEEDINGS

There are no significant and material orders passed by the regulators or courts or tribunal impacting the going concern status and the Company’s operations in the future.

Further no application against the Company has been filed or is pending under the Insolvency and Bankruptcy Code, 2016, nor the Company has done any one time settlement with any Bank or Financial institutions.

STATUTORY AUDITORS

The members, in the 30th Annual General Meeting (AGM) held on August 1, 2017, appointed

M/s. B S R & Co. LLP, Chartered Accountants, [ICAI Firm’s Registration No. 101248W/W- 100022] as the Statutory Auditors of the Company, to hold office for a term of five years from the conclusion of the 30th AGM of the Company held in the Financial Year 2017-18 until the conclusion of the AGM of the Company for the Financial Year 2021- 22 on such remuneration as may be determined by the Board of Directors.

Pursuant to Section 139 of the Companies Act, 2013 the Statutory Auditors M/s. B S R & Co. LLP, Chartered Accountants have confirmed that they are eligible to continue as auditors.

In accordance with provision of Section 139 of the Companies Act, 2013 read with Rules framed thereunder, the Board of Directors of the Company on the recommendation of the Audit Committee, proposes appointment of M/s. B SR & Co. LLP, Chartered Accountants (ICAI Firm’s Registration No. 101248W/W - 100022) as Statutory Auditors of the Company to hold office from the conclusion of ensuing 35th AGM for a term of five consecutive years till the conclusion of 40th AGM. The appointment of M/s. B S R & Co. LLP as the statutory auditors of the Company is placed before the members for approval at the ensuing AGM.

As required under provision of Section 139(1) of the Companies Act, 2013 the Company has received a written consent from M/s. B S R & Co. LLP for their

Chief Financial Officer (w.e.f. April 2, 2021) and Mr. Anil Khatri, Company Secretary & Compliance Officer were the Key Managerial Personnel of the Company during the year under review. Mr. Milind Kulkarni will retire as Chief Financial Officer of the Company w.e.f. May 31, 2022 and Mr. Rohit Anand was appointed as Chief Financial Officer of the Company w.e.f. June 1, 2022.

DIRECTORS’ RESPONSIBILITY STATEMENT

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

i. in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

ii. they have, in the selection of the accounting policies, consulted the Statutory Auditors and these have been applied consistently and, reasonable and prudent judgments and estimates have been made so as to give a true and fair view of the state of affairs of the Company as at March 31, 2022 and of the profit of the Company for the year ended on that date;

iii. proper and sufficient care had been taken 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 other irregularities;

iv. the annual accounts have been prepared on a going concern basis;

v. they had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively;

vi. the proper systems to ensure compliance with the provisions of all applicable laws are in place and are adequate and operating effectively.

DETAILS WITH RESPECT TO ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS

The Company has internal financial controls which are adequate and were operating effectively. The controls appointment and a certificate to the effect that their appointment, if made, would be in accordance with the Companies Act, 2013 and the Rules framed thereunder and that they satisfy the criteria provided in Section 141 of the Companies Act, 2013 read with Rule 4(1) of the Companies (Audit and Auditors) Rules, 2014 and that they are not disqualified for appointment as statutory auditors of the Company.

There are no qualifications, reservations, adverse remarks or disclaimer made in the audit report for the Financial Year 2021-22.

SECRETARIAL AUDIT REPORT

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 had appointed Mr. Makarand Lele & Co., Practicing Company Secretary, Pune to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is available at ‘Annexure IV” to this report. There are no qualifications, reservations, adverse remarks or disclaimer made in the Secretarial Audit Report.

COMPLIANCE WITH SECRETARIAL STANDARDS

The Company has complied with the applicable Secretarial Standards.

ANNUAL RETURN

Pursuant to the provisions of Section 92(3) read with Section 134(3) (a) of the Companies Act, 2013, the Annual Return in Form MGT-7 is available on the website of the Company and can be accessed at https://insights.techmahindra.com/investors/mgt7-annual-return-2021-22.pdf

MANAGERIAL REMUNERATION

Disclosures of the ratio of the remuneration of each director to the median employee’s remuneration and other details as required pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended from time to time, are provided as "Annexure V”.

None of the directors or Managing Director & CEO of the Company, received any remuneration or commission from Subsidiary Companies of your Company.

The details of remuneration paid to the Directors including the Managing Director & CEO of the Company is provided in Corporate Governance Report.

PARTICULARS OF EMPLOYEES

The information required under Section 197(12) of the Companies Act, 2013 ("the Act”) read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms part of this Report. However, pursuant to first proviso to Section 136(1) of the Act, this Report is being sent to the Shareholders excluding the aforesaid information. Any shareholder interested in obtaining said information, may write to the Company Secretary at the Registered Office / Corporate Office of the Company and the said information is open for inspection at the Registered Office of the Company.

POLICY ON PREVENTION OF SEXUAL HARASSMENT

Your Company laid down the Prevention of Sexual Harassment (POSH) policy which is available on its website. The Company has zero tolerance on Sexual Harassment at workplace. During the year under review there were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

The status of complaints received under POSH and redressed by the POSH Committee of the Company, during the Financial Year under review, are given below:

a) Number of complaints received - 45

b) Number of complaints redressed - 43

c) Number of complaints pending - 2

There are focused campaigns on the POSH policy within the Company and awareness drives that take place with the help of its BPS teams. Furthermore, the employees are required to undertake a mandatory annual certification on POSH to sensitize themselves and strengthen their awareness.

EMPLOYEE STOCK OPTION SCHEMES

During the year under review, there were no material changes in the Employee Stock Option Schemes (ESOPs) of the Company and the Schemes are in compliance with the SEBI Regulations on ESOPs.

As per Regulation 14 of Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021, the details of the ESOPs are uploaded on the website of the Company and can be accessed at https://insights.techmahindra. com/investors/Details-of-ESOPs-FY-2021-22.pdf

CORPORATE GOVERNANCE

A report on Corporate Governance covering among others composition, details of meetings of the Board and Committees along with a certificate for compliance with the conditions of Corporate Governance in accordance with the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, issued by the Statutory Auditors of the Company, forms part of this Annual Report.

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.

COST RECORDS

Maintenance of cost records and requirement of cost audit as prescribed under the provisions of Section 148(1) of the Companies Act, 2013 are not applicable for the business activities of the Company.

RISK MANAGEMENT

The Risk Management Committee of the Board of Directors guides the operating management to identify risks, analyze their probability and impact and prepare mitigation plans. It periodically reviews the Risk Management Framework & Enterprise Risk Register which is presented by the Chief Risk Officer. The Company identifies all potential risks viz. economical, business, currency, operational, climate, governance, financial, cyber, business continuity etc. and prepares a mitigation plan for each of the risks. The elements of risk as identified by the Company with the impact and mitigation strategy are set out in the Management Discussion and Analysis Report (MDA).

ESTABLISHMENT OF VIGIL MECHANISM

The Company has laid down Whistle Blower Policy covering Vigil Mechanism with protective Clauses for the Whistle Blowers. The Whistle Blower Policy is made available on the website of the Company.

DEPOSITS / LOANS & ADVANCES, GUARANTEES OR INVESTMENTS

The Company has not accepted any deposits from the public during the year under review. The particulars of loans/advances, guarantees and investments under Section 186 of the Companies Act, 2013 are given in the notes forming part of the Financial Statements.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All transactions entered into with Related Parties as defined under Section 2(76) of the Companies Act, 2013 and Regulation 23 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, ("The Listing Regulations”), during the Financial Year under review were in the ordinary course of business and at an arm’s length pricing basis and do not attract the provisions of Section 188 of the Companies Act, 2013. There were no transactions with related parties in the Financial Year which were in conflict with the interest of the Company and requiring compliance of the provisions of Regulation 23 of the Listing Regulations.

Suitable disclosure as required by the Indian Accounting Standards (Ind AS 24) has been made in the notes forming part of the Financial Statements.

The Company has formulated a policy on the materiality of Related Party Transactions and dealing with Related Party Transactions which has been uploaded on the website of the Company and can be accessed at https://insights.techmahindra.com/investors/Related-Party-Transactions-Policy.pdf

The particulars of related party transactions in prescribed Form AOC - 2 are attached

as ‘Annexure VI”.

Pursuant to Regulation 23(9) of the Listing Regulations, your Company has filed half yearly report on Related Party Transactions with the stock exchanges.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars as prescribed under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 are provided in “Annexure VII” which forms part of this report.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

The CSR vision of the Company is "Empowerment through Education.”

In compliance with the guidelines prescribed under Section 135 of the Companies Act, 2013, your Company has constituted a Corporate Social Responsibility (CSR) Committee of the Board. The CSR policy, covering the Objectives, Focus Areas, Governance Structure Monitoring and Reporting Framework among others is approved by the Board of Directors. In accordance with the amendments made in Section 135 in January 2021, the CSR Policy has been duly revised and is available on the website of the Company and can be accessed at https://files. techmahindra.com/static/img/pdf/csr-policy-techm-v3-march2021.pdf

The Company has spent more than 2% of the average net profits of the Company during the three immediately preceding Financial Years on CSR.

The Company’s social initiatives are mainly carried out by Tech Mahindra Foundation and Mahindra Educational Institutions, Section 8 (erstwhile Section 25) Companies promoted by the Company.

TECH MAHINDRA FOUNDATION (TMF) EDUCATION

The key initiatives taken by TMF in the arena of school education include:

ALL ROUND IMPROVEMENT IN SCHOOL EDUCATION (ARISE)

Tech Mahindra Foundation’s educational initiatives under ARISE are long-term school improvement programmes, in partnership with local governments and partner organisations. The Foundation in 2021-22 worked with 18 government primary schools to transform them into model schools of excellence. A total of 4,928 students were positively impacted under this programme, of which 2,646 were girls.

During the year, the Foundation expanded its work for children with special needs through its ARISE programme. This programme is a variant of ARISE in which children with special needs are provided chronic therapy as well as special education to help them lead more fulfilling lives. Through 28 projects, the programme enabled 3,792 children with special needs to become better learners with greater independence in managing their lives. The Foundation is also working

with some of the most committed NGOs in the disability sector to positively impact even more children.

SHIKSHAANTAR

Shikshaantar, envisioned as a programme for enhancing capacity of government school teachers, has emerged as an important programme in the education portfolio of the Foundation. TMF works with the Municipal Corporations in East Delhi and North Delhi by running their In-Service Teacher Education Institutes and during the year under review, as many as 9,573 teachers were trained as part of this initiative. This included specially designed modules for Digital Literacy, Child Safety, Cyber Security and Mental Health that were delivered to the teachers through online sessions. Physical training sessions with teachers resumed in the last few months of the year.

MOBILE SCIENCE LAB

In order to increase the footprint of its work in Education and reach the unreached, TMF had launched a unique initiative in 2019-20. The Mobile Science Lab (MSL). For this, a Mahindra bus has been remodeled to become a science lab on wheels and has been travelling from school to school in East Delhi to provide STEM learning for children in grades 3 and 4 in these schools. The MSL program resumed its operations in 2021-22 after a break of over a year, and during the year, as many as 4,590 students and 99 teachers were benefitted.

EMPLOYABILITY

Skills-for-Market Training (SMART) is the Foundation’s flagship programme in employability. It is built on the vision of an educated, enabled and empowered India, and the belief that educated and skilled youth are the country’s true strength. The programme started with 3 Centres in 2012 and is currently running over 85 Centres at 11 locations across India. These include SMART Centres, SMART Centres (training for people with disabilities), and SMART-T Centres (training in technical trades).

In 2021-22, your Company trained 16,715 young women and men under its SMART program, of which, 1,529 were persons with disabilities. More than 70% of the graduates are placed in jobs across multiple industries upon successful completion of the training. The average salaries being earned by the graduates of the SMART program have been steadily rising and crossed the '' 12,000 per month mark for the first time.

The Foundation’s commitment to setting new benchmarks in skill development in India has been underscored by the setting up of Tech Mahindra SMART Academies, which provide the highest quality of skill training to youngsters in Healthcare and Digital Technologies. During FY 2021-22, 1,677 students were trained at the eight Academies that are now functional - 4 in Healthcare, 3 in Digital Technologies, and 1 in Logistics.

TMF’S WORK IN COVID RELIEF

As FY 2021-22 began, the country was swept by a severe second wave of COVID-19, devastating large sections of the population. Continuing the COVID relief operations of the previous year, Tech Mahindra Foundation reached out to some of the most marginalized and vulnerable communities

- distributing ration kits, cooked meals, medical equipment, masks and PPE kits. More significantly, the Foundation managed to donate 20 fully equipped ambulances and install 10 oxygen plants at various charitable hospitals. In all, the COVID relief efforts of the Foundation have impacted over 2.3 million lives in 17 States of India through a wide range of initiatives.

MAHINDRA EDUCATIONAL INSTITUTIONS (MEI)

MEI - a not-for-profit, 100% subsidiary of the Company has set up Mahindra Ecole Centrale in August 2014

- through a collaborative venture between Mahindra Educational Institutions and Ecole Centrale of Paris, France (now known as Centrale Supelec) and the JNTU Hyderabad - to offer undergraduate engineering programs. Through this strong Indo-French Collaboration with Centrale Supelec and Industry connect with Tech Mahindra, MEC has emerged as a disruptive player in the field of Technical Education.

MEI has sponsored the setting up of Mahindra University to introduce diverse streams of education in addition to Engineering.

MAHINDRA UNIVERSITY (MU)

Mahindra University ("MU”) (sponsored by Mahindra Educational Institutions, ("MEI”) - a not-for-profit, 100% subsidiary of Tech Mahindra), was notified on May 20, 2020 by the Government of Telangana vide The Telangana State Private Universities (Establishment and Regulation) Act, 2018. for "educating future citizens for and of a better world”.

In 2021-22, Mahindra University launched 3 new schools besides the existing Ecole Centrale School

of Engineering— School of Management, School of Law and Indira Mahindra School of Education. Each of these Schools will run UG, PG and Ph.D. programs. Further, the University has subsequently planned to launch School of Media & Liberal Arts and School of Design in the next 2 years.

Cornell University’s SC Johnson College of Business, an ivy league institution is the "Academic Partner” for School of Management. Mahindra University’s School of Management (MU - SoM) will benefit significantly from Cornell University’s expertise in curriculum development, faculty exchange programs including some specialty courses delivery by the Cornell faculty to Mahindra University students, as well as student immersion at Cornell.

The School of Law, Mahindra University, commenced operations in September 2021 in Hyderabad and was founded on the philosophy of securing justice, equality, and service to all sections of society. With the needs of modern society evolving rapidly, there is a renewed focus on the importance of the discipline of law. The School of Law will aim to make a difference to the legal profession and practice by providing a diverse, flexible curriculum and pedagogy, touching on several aspects of domestic and international law, while appraising the students of the latest trends in academia and practice.

Indira Mahindra School of Education (IMSE) commenced its academic activities in 2021, with the PhD program. IMSE’s vision is to be a focused training ground for the next generation of teachers and school leaders through study of education where both researchers and practitioners are developed for working in and on educational issues.

In the academic year 2021, a total of 817 students were admitted to the University - of which 757 students were in various UG programs, including School of Management and School of Law, 24 students in the PG programs of School of Engineering and 36 students in the Ph.D programs across all the schools.

The Annual Report on CSR activities is provided as "Annexure VIII”.

SUSTAINABILITY

Climate change, escalation of wars and the pandemic have forced the world to look at Sustainability as the savior of our existence. The impact of the present crises can be handled better if a Sustainable

• Being Net Zero: Committed to be Net zero well before 2040 through adoption of renewable energy, increasing the use of energy-efficient equipment & tools across operations, creating eco-design of services, optimizing the use of resources across operations and preserving the biodiversity of areas in which we operate.

• Saying No to plastic: Maintaining plastic-free campuses and encouraging associates and stakeholders to use eco-friendly & biodegradable materials. Spreading awareness and initiating campaigns on preventing single-use plastic.

• Reduce, Reuse, Recycle, Recover: Implement process of Reduce, Reuse, Recycle and Recover across the value chain to limit waste and enable a circular economy.

• Sustainable supply chain: Ensure our suppliers follow the highest standards of sustainable and ethical best practices; optimise logistics and transportation to reduce emissions.

• Work-life balance: Provide an assured career development path and a feasible and flexi work-life balance to our associates along with a range of associate-friendly policies and processes to reduce attrition.

• Fostering Diversity: Offering improved opportunities and increasing the number of women, members of the LGBQ community, and PwDs to promote a diverse culture in the organization.

• Employee engagement and recognition:

Working diligently towards Employee engagement and increasing the number of employees recognized every year.

• Innovation: Becoming future-ready by proactively encouraging Innovative thinking across the organization, adopting technology disruption, and going digital to reduce emissions. Incorporating technologies such as loT, Blockchain, AI and Machine Learning to develop a portfolio of sustainable solutions that help reduce emissions and other negative impacts of climate change.

• Green solutions: Investing in Smart grid, Microgrid-As-A-Service, Community Action

business strategy is adopted by organizations globally. Sustainability must become an integral part of business strategy and management to ensure business continuity and profitable growth.

Being forerunners in the sustainability space, Tech Mahindra’s long-term growth strategy has always had ESG principles embedded in its core to help mitigate risks and drive profitable growth. Adopting proactive strategies that are resilient in nature has been the key to our continued success. Sustainable transformation with a focus on low carbon future has helped us to quickly adapt to disruptive changes and leverage these capabilities towards business continuity and management. Tech Mahindra’s sustainability commitments across environmental, social and governance pillars span across all our business verticals and even extends to our value chain. Being an organization with purpose, we have delivered on our promise to run better, change faster and grow greater while also creating meaningful human experiences for all.

Tech Mahindra is sourcing renewable energy, using energy-efficient equipment, and optimizing operations to achieve ecological balance while investing in and pioneering new solutions for sustainable development. Tech Mahindra’s emphasis on ESG is seen in our commitment of achieving Carbon Neutrality by 2030 and being Net zero well-before 2040. We are making optimum use of resources, moving towards low-emission technologies, and taking 5-year targets for ensuring diversity, equality, and innovation, while also updating policies and procedures to maintain a robust and compliant governance.

Tech Mahindra is aligned towards the UN SDGs (Sustainable Development Goals) and its sustainability focus areas are as below:

• Going Carbon Neutral: Increasing use of renewable energy through onsite installations and open access; improving energy efficiency through installation of LEDs, sensors; boosting green investments by implementing Carbon Price; optimizing business travel by enabling virtual meetings; encouraging use of public transport and carpooling to reduce commute emissions; planting trees to offset carbon footprints; moving towards a low carbon economy to ensure environmental protection.

Platform for Energy, Integrated Electric Vehicle Charging systems (IEVCS), Smart data hubs and Smart Cities for our Customers to reduce their emissions.

• Individual Social Responsibility: encouraging associates to make sustainability a part of their day-to-day lives.

• Transparency: Reporting our organizational policies & practices, along with financial, environmental and social data in the Integrated Annual Report.

The recognitions received by Tech Mahindra are a validation of the performance towards the company’s commitments, the details of the awards & recognitions are included in Corporate Overview, kindly refer page no. 25 of this Annual Report.

The Integrated Annual Report is based on various global standards and frameworks such as TCFD (Taskforce on Climate Related Financial Disclosures), CDSB (Climate Disclosure Standards Board), SASB (Sustainability Accounting Standard Board) and GRI standards and assured by third party according to ISAE (International Standard on Assurance Engagement) 3000 standards.

Tech Mahindra discloses climate-related risks and opportunities in line with the recommendations of TCFD which focusses on the financial impact of climate-related changes on our operations.

The TechM Board owns all risks and opportunities. The MD & CEO of the Company chairs the CSR Committee of the Board and has the ultimate responsibility for Sustainability. He is ably supported by the Senior Management members of the Sustainability Council and the Chief Sustainability Officer who manage all aspects of climate change.

The pandemic has taught the Company some concrete lessons and new ways of management in order to thrive in the new post-pandemic world. Tech Mahindra has made good progress on its commitments to provide for a better and more sustainable future by embedding sustainability into its business strategy and ensuring economic recovery and business profitability. The Company strategy includes futureproofing our growth against impending

changes in policies and regulations and increasing our compliance readiness. Your Company are agile and adaptive to dynamic changes in internal and external intricacies with strategies in place to manage all business and ESG risks in an effective way. With a robust business continuity management framework and incident response team, the Company have ensured that we are resilient to any ESG risks.

The targets and the metrics used for managing climate-related & other risks and the progress against these targets are disclosed in the externally assured Integrated reports available on the website of the Company and can be accessed at https://www. techmahindra.com/en-in/sustainability/.

AWARDS AND RECOGNITION

Your Company continued its quest for excellence in its chosen area of business to emerge as a true global brand. Several awards and rankings continue to endorse your Company as a thought leader in the industry. Few of the Awards / recognitions received by the Company during the year 2021-22 include:

• Tech Mahindra recognized among the Economic Times Iconic Brands 2021.

• Tech Mahindra was declared winner of

NASSCOM Engineering & Innovation Excellence Awards 2021 for Service Delivery Excellence & Next-Gen Products for our projects on Vehicle Top Hats & Distributed Ledger DnD.

• Tech Mahindra listed among 2021 Best

Workplaces in Asia by Great Place to Work®.

• Tech Mahindra received HRH, The Prince

of Wales’ Terra Carta Seal in Recognition of the Company’s Commitment to Creating a Sustainable Future.

• Tech Mahindra won 3 Golds at the prestigious 2021 Stevie Awards for Great Employers.

• Tech Mahindra Recognized as the Fastest

Growing Organization in ‘Brand Strength’ by Brand Finance.

• Tech Mahindra emerges as the only Indian

company in the Forbes’ Blockchain 50.

• Mr. C. P. Gurnani has been recognized by The Economic Times among ‘Most Inspiring Business Leaders of Asia’ at The Economic Times 6th Edition Asia’s Promising Business Leaders.

• Tech Mahindra Included in Bloomberg Gender-Equality Index for Third Consecutive Year.

• Tech Mahindra was recognized for its pathbreaking sustainable efforts and was ranked 2nd amongst the Top 35 companies in Business world India’s Most Sustainable Companies 2022.

These awards are a reflection of the Company’s continued efforts in the fields of business, sustainability, human resource management and its sustained progress towards creating a better society for all.

ACKNOWLEDGEMENTS

Your Directors place on record their appreciation for the contributions made by employees towards the success of your Company more particularly ensuring business as usual in spite of the impact of COVID-19. Your Directors gratefully acknowledge the cooperation and support received from the shareholders, customers, vendors, bankers, regulatory and Governmental authorities in India and abroad.

For and on behalf of the Board

Anand G. Mahindra Place: Mumbai Chairman

Date: May 13, 2022 (DIN: 00004695)


Mar 31, 2022

Your Directors present the Thirty Fifth Annual Report along with the audited accounts of your Company for the year ended March 31, 2022.

FINANCIAL RESULTS (STANDALONE)

('' in Million)

For the year ended March 31

2022

2021

Income

362,489

305,627

Profit Before Interest, Depreciation and Tax

70,081

62,521

Interest

(636)

(632)

Depreciation

(6,599)

(6,623)

Profit Before Tax

62,846

55,266

Provision for Taxation

(13,715)

(12,875)

Profit After Tax

49,131

42,391

Other Comprehensive Income

1,081

2,453

Balance brought forward from previous year

200,874

184,021

Profit available for appropriation

249,753

226,432

Equity Dividends (Including tax on dividend)

(43,624)1

(19,335)2

Transfer to retained earnings on account of options lapsed

74

96

Transferred to Special Economic Zone re-investment reserve (net of utilisation)

-

(6,319)

Transferred from Special Economic Zone re-investment reserve on utilization

6,348

-

Balance carried forward

212,551

200,874

1 Interim Dividend (Special Dividend) for the Financial Year ended March 31,2022 and Final Dividend for the Financial Year ended March 31,2021

2 Interim Dividend (Special Dividend) for the Financial Year ended March 31,2021 and Final Dividend for the Financial Year ended March 31,2020

SHARE CAPITAL

During the year under review, your Company allotted 3,573,412 equity shares on the exercise of stock options under various Employee Stock Option Schemes. Consequently, the issued, subscribed and paid-up equity share capital has increased from '' 4,841 million divided into 968,260,067 equity shares of '' 5/- each to '' 4,859 million divided into 971,833,479 equity shares of '' 5/- each.

BUSINESS PERFORMANCE / FINANCIAL OVERVIEW

Tech Mahindra lives by the philosophy of creating a connected world built on connected experiences. It thrives on change powered by the intelligent symphony of technology and humans, designing both meaningful and sustainable experiences. Your Company is strongly positioned to succeed in this new normal and deliver what’s NXT.NOW for its customers. The Company has a rare combination of connectivity and experience as its endowment which, along with


DIVIDEND

The Board of Directors on October 25, 2021 approved a special dividend of '' 15/- per share (i.e. 300%) on par value of '' 5/- each which was paid by the Company to the shareholders whose names appeared in the Register of Members as on November 5, 2021, being the record date for the payment of dividend. Your Directors are pleased to recommend a final dividend of '' 30/- per share (including a special dividend of '' 15/- per share) on par value of '' 5/- (i.e. 600%), payable to those Shareholders whose names appear in the Register of Members as on the Book Closure Date. Thus, the total dividend for the F Y 202122 will be '' 45/- per share (i.e. 900%) similar to the dividend of '' 45/- per share (i.e. 900%) paid for the Financial Year 2020-21.

Your Company has formulated a Dividend Policy which is disclosed on the website of the Company and can be accessed at https://insights.techmahindra.com/ investors/tml-dividend-distribution-policy.pdf

its big bets on Cloud and engineering, form the Company’s NXT.NOW strategy.

The main components of the NXT.NOW Strategy are:

Connectivity - Modernizing networks has been our legacy for more than 25 years, serving the top global wireless communication service providers.

Experience - The Company provides award-winning and industry-leading capabilities in human-centric design.

Cloud - The Company continues to invest in rapidly scaling its partnerships and is uniquely positioned to deliver on the promise of Cloud, AI, and cyber security for its customers.

Engineering - The Company is home to leading products and software capabilities, enabled by a network of global excellence centers and top engineering talent.

During the Financial Year ended on March 31, 2022, the Company’s revenues grew to '' 446,460 million on consolidated basis as against '' 378,551 million in the previous year - indicating a robust growth of 18%. The growth was broad based across geographies as both Americas and Europe contributed in line with overall revenue growth. The Company also saw healthy growth across business segments in CME and Enterprise verticals.

The EBITDA on consolidated basis for the Financial Year 2022 was '' 80,200 million, a growth of 17% over the previous year EBITDA of '' 68,470 million. The resultant EBITDA margins were in a similar range - 18% in FY 2022 as against 18.1% in FY 2021. The post-tax profit of the Company increased by 25.7% to '' 55,661 million in FY 2022 as against '' 44,280 million in FY 2021.

The Company saw robust demand for digital transformation services with focus on customer experience and cloud. The Company has seen new deal wins of over USD 3,000 million in the previous year indicating a healthy growth momentum across all business verticals. Your Company’s investments in Enterprise SaaS and Hi-tech capabilities will help it cater to increasing modernization demands from businesses in Financial Year 2023 and beyond.

ACQUISITIONS

Your company made the following acquisitions during the financial year 2021-22.

DIGITALONUS

The Company on May 7, 2021, acquired 100% of the share capital of DigitalOnUs Inc. through its wholly owned subsidiary company Tech Mahindra (Americas) Inc. at a consideration of USD 120 million including earnouts and retention bonus. The company is headquartered in California, USA and is focused on Cloud Native Development and Hybrid Cloud Automation Services. This acquisition helped your Company in enhancing capability in Cloud Native Engineering and positioned the Company to develop cutting-edge digital solutions for its customers.

EVENTUS SOLUTIONS GROUP

The Company on June 18, 2021, acquired 100% of the share capital of Eventus Solutions Group, LLC (Eventus) through its wholly owned subsidiary company Tech Mahindra (Americas) Inc. at a consideration of USD 44 million including earnouts. Eventus is headquartered in Denver, Colorado, USA and has strong consulting capability in customer experience (CX) and customer management and enabled your Company to build an industry leading consulting practice in BPS business.

BERIS CONSULTING GMBH

The Company on October 1, 2021, acquired 100% of the share capital of Beris Consulting GmbH (Beris) through its subsidiary Company Tech Mahindra GmbH at a consideration of EUR 7 million including earnouts. Beris has 125 employees and helps your Company to unlock the transformational growth in the IT and application space for the automotive industry as a result of industry trends such as EV, Sharing & Mobility. It will also help your Company to expand its presence, hone local expertise and client relationships in the German market.

INFOSTAR LLC

The Company acquired 100% of the share capital of Infostar LLC (Lodestone) through its wholly owned subsidiary company Tech Mahindra (Americas) Inc. on October 25, 2021 at a consideration of USD 105 million including earnouts. Lodestone is headquartered in California, USA and helps your company to bolster end to end digital product engineering capabilities across design, build and test by employing Lodestone’s expertise in data strategy and providing end to end product quality assurance across hardware, software and data layers.

WE MAKE WEBSITES

The Company acquired 100% of the share capital of We Make Websites, UK through its step-down

subsidiary company Born London Limited, UK on October 25, 2021 at a consideration of GBP 9.4 million. The company is headquartered in UK and its offerings include Custom Shopify App Development, focused Ecommerce Agency, Design & UX, re-platforming, SEO & Data Migration, Headless Commerce, CRO, Performance Enhancement, Payments & Checkout, Compliance, Accessibility and O2O strategy.

BRAINSCALE

The Company on November 17, 2021, acquired 100% of the equity shares in Brainscale Inc. (Brainscale) through its wholly owned subsidiary company Tech Mahindra (Americas) Inc. at a consideration of USD 28.8 million including earnouts. Brainscale has expertise in Cloud consulting, Cloud enablement, Application Development and Data Analytics, which will bolster your company’s consulting capabilities in the Cloud transformation space and will enable your Company to drive growth of Cloud related IT services.

ACTIVUS

The Company on December 3, 2021, acquired 100% of the equity shares in Activus Connect LLC and Activus Connect PR LLC (together called as Activus) through its wholly owned subsidiary company Tech Mahindra (Americas) Inc. at a consideration of USD 62 million including earnouts. Activus is headquartered in Florida USA and has 1750 employees and is in the business of remote customer experience and customer care solution. This acquisition will help improve your company’s capability in the work from home Customer Experience Management by employing unique delivery model and disruptive platform called Smart Virtual.

ALLYIS

The Company on December 31, 2021, acquired 100% of the equity shares in Green Investments LLC (Allyis) through its wholly owned subsidiary company Tech Mahindra (Americas) Inc. at a consideration of USD 122.4 million including retention bonus and earnouts. Allyis is headquartered in Seattle, USA and has presence in US, Romania, Costa-Rica and India. The Indian subsidiary was acquired by Tech Mahindra Limited, at a consideration of USD 2.6 million. Allyis offers Technology consulting and managed services that help Organizations to reduce costs, improve performance which would help your Company’s capabilities in digital experience solutions and engineering, cloud and automation, BI and Analytics and Technical Support services.

CTC

The Company on January 17, 2022, acquired 100% of the equity shares in Com Tech Co IT Limited (CTC) through its wholly owned subsidiary company Tech Mahindra London Limited at a consideration of EUR 310 million including earnouts. CTC has 720 employees and is a specialized digital engineering and outsourced product development organization with development centers in Latvia and Belarus. It offers high-end-digital engineering services to some of the largest insurance and reinsurance organisations globally. Your Company also acquired 25% equity shares each in SWFT Technologies and Surance Ltd which are early stage InsurTech SaaS ventures with a proven technology.

GEOMATIC.AI

The Company acquired 80% of the share capital of Geomatic.AI Pty Ltd, Australia through its wholly owned subsidiary company Tech Mahindra (Singapore) Pte. Ltd on February 15, 2022 at a consideration of A$6 million. Geomatic.AI is headquartered in Australia and its offerings include digital platforms led nonlinear growth in partnership with AusNet Services an Australian Energy & Utilities distributor and will build digital twins for linear assets leveraging Cloud, Drone and Mobility technologies in the Geospatial domain.

DETAILS OF SUBSIDIARIES / JOINT VENTURES / ASSOCIATE COMPANIES

The performance and financial position of the subsidiaries, associate and joint venture companies included in the consolidated financial statement is provided in accordance with the provisions of Section 129 read with Rule 5 of the Companies (Accounts) Rules, 2014 containing the salient features of the financial statement of the Company’s subsidiaries/joint ventures or associate companies in Form AOC - 1 in "Annexure I” to this report.

Pursuant to Rule 8(5)(iv) of the Companies (Accounts) Rules, 2014, the names of the companies which have been incorporated or ceased to be the subsidiaries, joint ventures or associate companies during the year are provided in "Annexure II” to this report. The Company is actively pursuing the initiative on the consolidation of its subsidiaries/branches to optimize the operational costs. During the year under review, your Company has closed/merged fourteen subsidiaries.

In terms of the provisions of Regulation 24 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations 2015, Tech Mahindra (Americas) Inc. is a wholly owned unlisted material subsidiary of the Company.

The policy for determining material subsidiaries formulated by the Board of Directors is disclosed on the website of the Company and can be accessed at https://insights.techmahindra.com/investors/Policy-For-Determining-Material-Subsidiaries.pdf

UPDATE ON MERGER

The Board of Directors at its meeting held on January 31, 2021 approved the Scheme of Merger of Tech Mahindra Business Services Ltd and Born Commerce Private Ltd with the Company. Accordingly, the companies filed the petitions before the Hon’ble National Company Law Tribunal (NCLT), Mumbai and Chennai Benches respectively. The petitions are pending for final hearing as on the date of this Report.

HUMAN RESOURCES

The employees of the Company are the most critical asset to your Company. The Company has taken several steps to protect, retain, and improve the competencies of these assets including:

Hiring: War for Talent

Your Company responded to the ‘Great Resignation’ by adopting many innovative practices such as remote hiring, hybrid working, productivity to the engagement of remote workforce. With no location constraints, your Company could hire diverse talent including stay-at-home women, retired professionals, Persons with Disabilities (PwDs), gig workers, and more. Through the NXT.Town program, your Company started small centres in Tier-II and Tier-III cities across India to proactively look beyond set boundaries and focus on skill-based hiring in emerging technologies. Your Company is also committed to diversifying talent hiring at global delivery centres to improve local customer connect. Your Company has restructured its referral and campus recruitment programs to actively encourage hiring at the ‘bottom of the pyramid’. The Digital RMG platform has helped your Company proactively hire based on forecasted demand through a custom-built applicant tracking system that allows collaborative hiring and improves the candidate experience.

Learning: Build v/s Buy Talent

At your Company, learning plays a strategic role in the achievement of business goals by facilitating upskilling and creating a future-ready workforce, all the while fulfilling its associates’ career aspirations. In order to enable end-to-end digital transformation for global customers, your Company is building skills and keeping its talent pool brimming with new-age technologies. By offering skill-based and accelerated career movement allowance through the Career Acceleration Policy, your Company is encouraging niche skilling, thus creating a win-win situation. Your Company has launched a Cloud Finishing School for creating project-ready talent in Cloud technologies to fulfil business needs. After the success of the EMBARK capability building program for Program Managers, your Company has started an Architect COE for solution and technical architects who work on digital transformation. In an effort to build a roster of young and diverse leadership, the Company has launched focused young leader and women leader programs, with an emphasis on deploying them into new roles once their learning journey is complete. The Company has also partnered with Harvard to offer bite-sized learning content via the Harvard Manager Mentor (HMM) SPARK platform. Your Company continues to leverage its #NAD Learn platform to create full-stack professionals through initiatives like fresher-skilling, project-skilling, future-skilling and bench-skilling (Competence to Deployment) to create future-ready talent, in line with its NXT.NOW philosophy.

Leadership: Extreme Ownership

The natural culture of empowerment at your Company was supercharged during the pandemic as associates took ownership for their deliverables and leaders at all levels were an integral part of the decision-making process. The Leadership team of the Company aims to imbibe the following atomic habits -alternate thinking, bias for action, closure over followup, data over emotions and extreme ownership. This was reinforced through the adoption of a real-time Performance Management Dashboard for the 300 talent-to-value business leaders whose continuous executive coaching and performance management was instrumental in your Company meeting its financial and strategic goals. Apart from coaching, the Leaders at the Company have also had the opportunity to experience new forms of learning with technology-enabled pedagogies like habit builders, qubit

thinking, cinema-based learning, gamification etc. The Company also launched the Leadership Retreat, an eight-day-long learn-as-you-work residential program to replenish the physical, emotional, cognitive, and social energies of mid and senior level leaders.

Performance: Outcome-Driven

Your Company launched the Annual Performance Feedback cycle in December 2021 and has completed its performance appraisal. Aspiring to build a culture where performance is enabled through feedback, managers have been trained to engage in better performance review dialogues with their direct reports and work on an outcome-based evaluation, rather than process or effort measurement. Your Company is creating a high-performance culture through hyper-personalized incentive plans. Your Company has a suite of incentive plans that are designed to create a strong alignment between individual wealth creation and organizational performance. In addition to broad-based incentive plans, your Company has also customized quarterly sprint incentives which create avenues for instant gratification for associates across the front, middle, back offices as well as enabling functions, thereby inculcating a spirit of collaboration. With platforms like Talex, #NAD Learn and a revamped job rotations policy, your Company continued to improve internal mobility.

Wellness: Holistic Wellbeing

The ‘Wellness Before Business’ mantra followed by your Company has ensured the collective well-being and safety of its entire ecosystem of stakeholders, including associates, customers, and partners. The Wealth of Wellness (WoW) program ensures preventive, personalized, and proactive holistic wellness across all 8 dimensions of wellness including physical, mental, emotional, and financial parameters. The Company has launched new policies like the Bereavement Support for Dependents (COVID Support) Policy, Sabbatical Leave Policy, and more in response to the unique challenges posed by the pandemic. Your Company also provided financial security and crucial support through the Associate Welfare Trust for 190 associates, disbursing '' 2.8 crores. To highlight the importance of physical well-being, your Company launched the Wellness 101 Challenge as well as the Run Anywhere virtual marathon to engage its associates who predominantly worked from home and encouraged them to reclaim their fitness. Mental well-being was prioritized through initiatives like the Mind Plan, People Care Manager Program and the Emotional Wellness Self-Assessment.

Pandemic: #ResolveToRise

#ResolveToRise was an organization-wide campaign by the Company, rallying associates to embrace the Rise credo and encouraging them to stay strong by sharing inspiring stories and initiatives from the ground, including COVID warriors assisting those in need, Company-led innovations using #TechForGood to help the most vulnerable, community-wide volunteering efforts, and more. During the pandemic, the Company also setup a COVID-19 Support Fund, providing much-needed relief to affected families, setting up oxygen plants and donating ambulances to charitable hospitals. Your Company also setup COVID care centres at five major locations to help both associates and the larger community. Through the SOS Seva, your Company helped patients access critical care including hospital beds, oxygen cylinders, oxygen concentrators, medicines, and plasma. Through a series of vaccination drives, your Company has encouraged protection and prevention, vaccinating associates, their family members, and other third-party staff.

Communication: Building Purpose

Through effective internal communications, your Company ensures that the connected purpose of the organisation is communicated to all associates, thus reiterating the core philosophy of the brand: creating a connected world with connected experiences. With hybrid working being the norm, your Company has made virtual connectedness a way of life through various digital initiatives that were purpose-led, peoplecentric, and performance-driven. Multiple mediums were used to reach out to associates including social media, e-chats, emailers, campaigns, screensavers and more. With a 360-degree-communication approach, your Company has built a culture that is based on celebration, positive change, and the credo of Rise which has resulted in a unifying pride for the Company - their #LoveToBeTechM.

Diversity: Being Yourself

Your Company considers ‘diversity of people’, ensuring ‘equitable opportunities’ and ‘inclusion at the workplace’ as an instrument of growth. This has reflected in the definition of the new vision statement of your Company. The earlier Vision 2021 was about fostering innovation and that comes from ‘diversity of thought’. The new Vision 2024 is about creating a purpose-led company. Your Company is committed to pursuing ‘Purpose beyond Profits’ by embedding Environmental, Social and Governance

Engagement: TechM CARES Survey

Your Company has taken active steps to build remote engagement by creating virtual ‘water-cooler’ moments and updating policies in line with the ‘new normal’. To ensure that associates were continuously engaged through the right channels and received the right information at the right time, your Company followed the 4C model - Connect, Collaborate, Career, and Celebrate. Associates have expressed their confidence and delight through the TechM CARES survey where your Company has secured an overall rating of 4.58/5 - the highest score in its history. This engagement score represents a 54 basis points increase over the last survey score of 4.04/5 and reinforces your Company’s commitment to create human-centered experiences for its associates.

QUALITY

The Company continues its focus on quality and strives to exceed customer expectations at all times. During the year, it continued to strengthen the implementation of Quality systems and upgraded various processes to comply with CMMI V 2.0 for both Dev and Services. The Organization is recently assessed at Level 5 maturity. Similarly it underwent various upgrade and re-certification audits for multiple standards during the year in order to meet client demands and enhance value delivery. The Company has Successfully re-certified, ISO 9001:2015 (Quality Management System), ISO 20000-1:2018 (Information Technology Service Management System), ISO 27001:2013 (Information Security Management System), ISO 27701:2019 (Privacy Information Management System), TL9000 R 6.2/ R5.7 (Quality Management Systems for Tele Communications industry), ISO 13485:2016 (Quality Management Systems for medical devices - scope of certification limited to medical devices business within Tech Mahindra), AS9100 Rev D (Standard for Aerospace domain - scope of certification limited to the aerospace business within Tech Mahindra), ISO 17025:2017 - Laboratory Quality Management Systems for device testing labs.

In addition to these, your Company also maintains its commitment to health, safety and environment by continually improving its processes in accordance with ISO 14001:2015 (Environmental Management System) and ISO 45001: 2018 (Occupational Health and Safety Assessment Series) standards. Your Company is also certified on ISO 22301:2012 (Societal Security and

(ESG) principles into its core strategy, thus creating a long-term positive impact on the planet and society while providing greater value for all its stakeholders. Improvements in Diversity, Equity and Inclusion practices is critical to improve the Social aspect of ESG, and hence your Company has defined a roadmap for improvements across the dimensions of Gender, Generation, People with Disabilities, the LGBTQ community as well as cultures and nationalities. This also links back to the stated objective of your Company to be human-centered by encouraging associates to bring their most authentic selves to work.

Recognition: People at the Core

While timely recognition is key to a happy workforce, your Company also prioritizes creating a culture of appreciation. Your Company’s robust digital platform ensures both recognition and appreciation with monetary and non-monetary rewards badges linked to redemption points. Your Company also encourages its associates to donate their reward points towards social causes and has an industryleading rewards penetration of approximately 40%. To celebrate achievements in the virtual world, your Company introduced the quarterly Spotlight awards and other timely sales- focused awards to reward growth, collaboration, and high-impact initiatives. Your Company also included associates’ family members to virtually felicitate both Long Service Awardees and ACERs (consistent performers for two years) for their outstanding contributions and commitment.

HR Digitization: Automation at every Step

Your Company has continued to invest in its flagship product, ‘Dove,’ for new joiners, enabling new capabilities for document submissions and personal information updates. Your Company has continued to enhance self-service capabilities for existing associates in diverse areas such as letter generation, work permits, automated approvals, and proactive notifications for key events. Your Company has adopted Office 365 as well as the Enate and UNO platforms to automate routine business transactions through BOTs. Your Company has also taken steps to improve the post-joining and pre-exit processes to improve communication as a step towards empowering associates with the right information. Your Company has also leveraged Artificial Intelligence/ Machine learning to build internal applications to provide associates with customer-like experiences.

Business Continuity Management System) and has a comprehensive Business Continuity and Disaster Recovery framework, to prevent potential business disruptions in the event of any disaster. The Company has processes that helped resume services to customer’s acceptable service levels. Automated Service Desk with SLAs for enabling business and Vulnerability Assessment and Penetration Testing Lab for secured corporate network operations are highlights that showcase the information security posture of the Organization.

During the second year of the pandemic, the entire quality management system was put to test with majority of the associates working from home. Complying with the Company’s security requirements, they were able to deliver services as per contractual commitments, leading to great customer satisfaction.

Tech Mahindra (IT Division) has been assessed for the implementation of high maturity business excellence practices at Mahindra Group (Services Sector). It has been assessed at TMW Maturity Stage 7 (on scale of 1-10 stages) of Mahindra Business Excellence Framework - The Mahindra Way. These certifications are testimony of the robustness of business processes and at large the quality culture imbibed in the organization.

Your Company has continued to strengthen the process for transforming Quality Assurance processes & delivery methods to adopt and strengthen Delivery excellence, Risk governance, and further enhance automation to enable quality delivery to the customer. Quality index which is a measure of quality of products and services delivery is institutionalized.

All these actions are being taken to ensure that the Company deliver as stated in its Quality Policy.

DIRECTORS

During the year under review, all Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Independent Directors have also given declaration of compliance with Rules 6(1) and 6(2) of the Companies (Appointment and Qualification of Directors) Rules, 2014, with respect to

their name appearing in the data bank of Independent Directors maintained by the Indian Institute of Corporate Affairs.

Pursuant to the provisions of Section 152(6)(c) of the Companies Act, 2013, Mr. C. P. Gurnani, Managing Director & CEO (DIN: 00018234) is liable to retire by rotation and offers himself for reappointment.

Further the term of Mr. C. P. Gurnani as Managing Director & CEO expires on August 9, 2022. The Board of Directors based on the recommendation of Nomination and Remuneration Committee considering the performance of the Managing Director & CEO over the last 10 years & his contribution to the growth of the Company approved and recommends the re-appointment of Mr. C. P. Gurnani as Managing Director & CEO for another term from August 10, 2022 upto December 19, 2023, which is his date of retirement from the Company, subject to the approval of shareholders at the ensuing Annual General Meeting.

Your Directors co-opted Ms. Penelope Fowler (DIN: 09591815) as an Additional Director with effect from May 13, 2022. The term of Ms. Fowler will end at the ensuing Annual General Meeting. As Ms. Penelope Fowler meets the criteria of an Independent Director, the Board recommends her appointment as an Independent Director for a period of 5 years for the approval of shareholders at the ensuing Annual General Meeting.

Mr. M. Damodaran (DIN: 00125299) has retired as an Independent Director of the Company with effect from March 31, 2022. Your Board places on record its sincere appreciation for the valuable contribution and timely guidance from Mr. M. Damodaran to the Company during his tenure.

In terms of Regulation 24(1) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations 2015, Mr. T. N. Manoharan, Lead Independent Director of the Company has been appointed as Director on the Board of Tech Mahindra (Americas) Inc., a wholly owned unlisted material subsidiary of the Company with effect from May 21, 2019.

In the opinion of the Board of Directors the Independent Directors have relevant proficiency, expertise and experience.

i. Policy on the appointment and removal of Directors, Key Managerial Personnel and Senior Management.

ii. Policy on remuneration to the Directors, Key Managerial Personnel and Senior Management and other Employees.

The extract of these two policies is provided in "Annexure III''

The policies are available on the website of the Company and can be accessed at https://insights. techmahindra.com/investors/Governance-Policies-including-remuneration-to-Directors-KMPS.pdf

SUCCESSION PLAN

In accordance with the principles of transparency and consistency, your Company has adopted governance policies for appointments, remuneration and evaluation of its Board of Directors, Key Managerial Personnel & Senior Management. In line with these Governance policies, the Company has established a formal Succession Planning Program for key managerial persons across the organization. The Board evaluates all such plans at a regular interval and institutes a formal program for filling any such critical position. The Board evaluates both internal and external candidates for such positions alongwith the recommendations of the Company. The Company also has a leadership development program where it identifies high potential managers, and trains them to take up the positions of higher responsibility. The Company has identified the second line of leadership, which provides stability to the business in any contingencies.

TRAINING

The Company has laid down a policy on the training of Independent Directors as part of its governance policies. The Senior Leadership of the Company periodically updates the Directors on regulatory changes, business strategy and the Company has laid down a policy on the training of Independent Directors as part of its governance policies. The Senior Leadership of the Company periodically updates the Directors on regulatory changes, business strategy and operations.

KEY MANAGERIAL PERSONNEL (KMP) Pursuant to provisions of Section 203 of the Companies Act, 2013, Mr. C. P Gurnani, Managing Director & Chief Executive Officer, Mr. Manoj Bhat, Chief Financial Officer (up to April 1, 2021), Mr. Milind Kulkarni,


FAMILIARISATION PROGRAMME

These programmes aim to provide insights into the Company to enable the Independent Directors to understand its business in depth and contribute significantly to the Company. The details of program for familiarisation of the Independent Directors with the Company are available on its website and can be accessed at https://insights.techmahindra.com/ investorsltml-familarisation-progarmmes-for-IDs.pdf

The Board members are also regularly updated on changes in statutory provisions like changes in Corporate Laws, SEBI Regulations, Taxation Laws and People related laws as applicable at the quarterly Board meetings. The Board members are also updated on the Risk universe applicable to the Company’s business. The MD & CEO of the Company had quarterly sessions with Board members sharing updates about the Company’s business strategy, operations and the key trends in the IT industry that are relevant to the Company. These updates help the Board members in keeping abreast of key changes and their impact on the Company.

BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and Regulation 19 read with Schedule II, Part D of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has devised a policy on evaluating the performance of the Board of Directors, the Chairman, Committees, and Individual Directors. The evaluation process was carried out through a web-based portal. The summary of the evaluation reports was presented to the respective Committees and the Board. The Directors had given a positive feedback on the overall functioning of the Committees and the Board. The suggestions made by the Directors in the evaluation process have been suitably incorporated in the processes.

NUMBER OF MEETINGS OF THE BOARD

The Board met four times during the Financial Year 2021-22. The meeting details are provided in Corporate Governance report that forms part of this Annual Report. The maximum interval between any two meetings did not exceed 120 days as prescribed in the Companies Act, 2013 and SEBI Listing Regulations.

POLICY ON DIRECTORS’ APPOINTMENT AND REMUNERATION

The Governance policies laid down by the Board of Directors of your Company include:

are adequate for ensuring the orderly and efficient conduct of the business, including adherence to the Company’s policies, the safe guarding of assets, the prevention and detection of frauds and errors, the accuracy and completeness of accounting records and timely preparation of reliable financial information.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS / PROCEEDINGS

There are no significant and material orders passed by the regulators or courts or tribunal impacting the going concern status and the Company’s operations in the future.

Further no application against the Company has been filed or is pending under the Insolvency and Bankruptcy Code, 2016, nor the Company has done any one time settlement with any Bank or Financial institutions.

STATUTORY AUDITORS

The members, in the 30th Annual General Meeting (AGM) held on August 1, 2017, appointed

M/s. B S R & Co. LLP, Chartered Accountants, [ICAI Firm’s Registration No. 101248W/W- 100022] as the Statutory Auditors of the Company, to hold office for a term of five years from the conclusion of the 30th AGM of the Company held in the Financial Year 2017-18 until the conclusion of the AGM of the Company for the Financial Year 2021- 22 on such remuneration as may be determined by the Board of Directors.

Pursuant to Section 139 of the Companies Act, 2013 the Statutory Auditors M/s. B S R & Co. LLP, Chartered Accountants have confirmed that they are eligible to continue as auditors.

In accordance with provision of Section 139 of the Companies Act, 2013 read with Rules framed thereunder, the Board of Directors of the Company on the recommendation of the Audit Committee, proposes appointment of M/s. B SR & Co. LLP, Chartered Accountants (ICAI Firm’s Registration No. 101248W/W - 100022) as Statutory Auditors of the Company to hold office from the conclusion of ensuing 35th AGM for a term of five consecutive years till the conclusion of 40th AGM. The appointment of M/s. B S R & Co. LLP as the statutory auditors of the Company is placed before the members for approval at the ensuing AGM.

As required under provision of Section 139(1) of the Companies Act, 2013 the Company has received a written consent from M/s. B S R & Co. LLP for their

Chief Financial Officer (w.e.f. April 2, 2021) and Mr. Anil Khatri, Company Secretary & Compliance Officer were the Key Managerial Personnel of the Company during the year under review. Mr. Milind Kulkarni will retire as Chief Financial Officer of the Company w.e.f. May 31, 2022 and Mr. Rohit Anand was appointed as Chief Financial Officer of the Company w.e.f. June 1, 2022.

DIRECTORS’ RESPONSIBILITY STATEMENT

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

i. in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

ii. they have, in the selection of the accounting policies, consulted the Statutory Auditors and these have been applied consistently and, reasonable and prudent judgments and estimates have been made so as to give a true and fair view of the state of affairs of the Company as at March 31, 2022 and of the profit of the Company for the year ended on that date;

iii. proper and sufficient care had been taken 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 other irregularities;

iv. the annual accounts have been prepared on a going concern basis;

v. they had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively;

vi. the proper systems to ensure compliance with the provisions of all applicable laws are in place and are adequate and operating effectively.

DETAILS WITH RESPECT TO ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS

The Company has internal financial controls which are adequate and were operating effectively. The controls appointment and a certificate to the effect that their appointment, if made, would be in accordance with the Companies Act, 2013 and the Rules framed thereunder and that they satisfy the criteria provided in Section 141 of the Companies Act, 2013 read with Rule 4(1) of the Companies (Audit and Auditors) Rules, 2014 and that they are not disqualified for appointment as statutory auditors of the Company.

There are no qualifications, reservations, adverse remarks or disclaimer made in the audit report for the Financial Year 2021-22.

SECRETARIAL AUDIT REPORT

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 had appointed Mr. Makarand Lele & Co., Practicing Company Secretary, Pune to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is available at ‘Annexure IV” to this report. There are no qualifications, reservations, adverse remarks or disclaimer made in the Secretarial Audit Report.

COMPLIANCE WITH SECRETARIAL STANDARDS

The Company has complied with the applicable Secretarial Standards.

ANNUAL RETURN

Pursuant to the provisions of Section 92(3) read with Section 134(3) (a) of the Companies Act, 2013, the Annual Return in Form MGT-7 is available on the website of the Company and can be accessed at https://insights.techmahindra.com/investors/mgt7-annual-return-2021-22.pdf

MANAGERIAL REMUNERATION

Disclosures of the ratio of the remuneration of each director to the median employee’s remuneration and other details as required pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended from time to time, are provided as "Annexure V”.

None of the directors or Managing Director & CEO of the Company, received any remuneration or commission from Subsidiary Companies of your Company.

The details of remuneration paid to the Directors including the Managing Director & CEO of the Company is provided in Corporate Governance Report.

PARTICULARS OF EMPLOYEES

The information required under Section 197(12) of the Companies Act, 2013 ("the Act”) read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms part of this Report. However, pursuant to first proviso to Section 136(1) of the Act, this Report is being sent to the Shareholders excluding the aforesaid information. Any shareholder interested in obtaining said information, may write to the Company Secretary at the Registered Office / Corporate Office of the Company and the said information is open for inspection at the Registered Office of the Company.

POLICY ON PREVENTION OF SEXUAL HARASSMENT

Your Company laid down the Prevention of Sexual Harassment (POSH) policy which is available on its website. The Company has zero tolerance on Sexual Harassment at workplace. During the year under review there were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

The status of complaints received under POSH and redressed by the POSH Committee of the Company, during the Financial Year under review, are given below:

a) Number of complaints received - 45

b) Number of complaints redressed - 43

c) Number of complaints pending - 2

There are focused campaigns on the POSH policy within the Company and awareness drives that take place with the help of its BPS teams. Furthermore, the employees are required to undertake a mandatory annual certification on POSH to sensitize themselves and strengthen their awareness.

EMPLOYEE STOCK OPTION SCHEMES

During the year under review, there were no material changes in the Employee Stock Option Schemes (ESOPs) of the Company and the Schemes are in compliance with the SEBI Regulations on ESOPs.

As per Regulation 14 of Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021, the details of the ESOPs are uploaded on the website of the Company and can be accessed at https://insights.techmahindra. com/investors/Details-of-ESOPs-FY-2021-22.pdf

CORPORATE GOVERNANCE

A report on Corporate Governance covering among others composition, details of meetings of the Board and Committees along with a certificate for compliance with the conditions of Corporate Governance in accordance with the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, issued by the Statutory Auditors of the Company, forms part of this Annual Report.

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.

COST RECORDS

Maintenance of cost records and requirement of cost audit as prescribed under the provisions of Section 148(1) of the Companies Act, 2013 are not applicable for the business activities of the Company.

RISK MANAGEMENT

The Risk Management Committee of the Board of Directors guides the operating management to identify risks, analyze their probability and impact and prepare mitigation plans. It periodically reviews the Risk Management Framework & Enterprise Risk Register which is presented by the Chief Risk Officer. The Company identifies all potential risks viz. economical, business, currency, operational, climate, governance, financial, cyber, business continuity etc. and prepares a mitigation plan for each of the risks. The elements of risk as identified by the Company with the impact and mitigation strategy are set out in the Management Discussion and Analysis Report (MDA).

ESTABLISHMENT OF VIGIL MECHANISM

The Company has laid down Whistle Blower Policy covering Vigil Mechanism with protective Clauses for the Whistle Blowers. The Whistle Blower Policy is made available on the website of the Company.

DEPOSITS / LOANS & ADVANCES, GUARANTEES OR INVESTMENTS

The Company has not accepted any deposits from the public during the year under review. The particulars of loans/advances, guarantees and investments under Section 186 of the Companies Act, 2013 are given in the notes forming part of the Financial Statements.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All transactions entered into with Related Parties as defined under Section 2(76) of the Companies Act, 2013 and Regulation 23 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, ("The Listing Regulations”), during the Financial Year under review were in the ordinary course of business and at an arm’s length pricing basis and do not attract the provisions of Section 188 of the Companies Act, 2013. There were no transactions with related parties in the Financial Year which were in conflict with the interest of the Company and requiring compliance of the provisions of Regulation 23 of the Listing Regulations.

Suitable disclosure as required by the Indian Accounting Standards (Ind AS 24) has been made in the notes forming part of the Financial Statements.

The Company has formulated a policy on the materiality of Related Party Transactions and dealing with Related Party Transactions which has been uploaded on the website of the Company and can be accessed at https://insights.techmahindra.com/investors/Related-Party-Transactions-Policy.pdf

The particulars of related party transactions in prescribed Form AOC - 2 are attached

as ‘Annexure VI”.

Pursuant to Regulation 23(9) of the Listing Regulations, your Company has filed half yearly report on Related Party Transactions with the stock exchanges.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars as prescribed under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 are provided in “Annexure VII” which forms part of this report.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

The CSR vision of the Company is "Empowerment through Education.”

In compliance with the guidelines prescribed under Section 135 of the Companies Act, 2013, your Company has constituted a Corporate Social Responsibility (CSR) Committee of the Board. The CSR policy, covering the Objectives, Focus Areas, Governance Structure Monitoring and Reporting Framework among others is approved by the Board of Directors. In accordance with the amendments made in Section 135 in January 2021, the CSR Policy has been duly revised and is available on the website of the Company and can be accessed at https://files. techmahindra.com/static/img/pdf/csr-policy-techm-v3-march2021.pdf

The Company has spent more than 2% of the average net profits of the Company during the three immediately preceding Financial Years on CSR.

The Company’s social initiatives are mainly carried out by Tech Mahindra Foundation and Mahindra Educational Institutions, Section 8 (erstwhile Section 25) Companies promoted by the Company.

TECH MAHINDRA FOUNDATION (TMF) EDUCATION

The key initiatives taken by TMF in the arena of school education include:

ALL ROUND IMPROVEMENT IN SCHOOL EDUCATION (ARISE)

Tech Mahindra Foundation’s educational initiatives under ARISE are long-term school improvement programmes, in partnership with local governments and partner organisations. The Foundation in 2021-22 worked with 18 government primary schools to transform them into model schools of excellence. A total of 4,928 students were positively impacted under this programme, of which 2,646 were girls.

During the year, the Foundation expanded its work for children with special needs through its ARISE programme. This programme is a variant of ARISE in which children with special needs are provided chronic therapy as well as special education to help them lead more fulfilling lives. Through 28 projects, the programme enabled 3,792 children with special needs to become better learners with greater independence in managing their lives. The Foundation is also working

with some of the most committed NGOs in the disability sector to positively impact even more children.

SHIKSHAANTAR

Shikshaantar, envisioned as a programme for enhancing capacity of government school teachers, has emerged as an important programme in the education portfolio of the Foundation. TMF works with the Municipal Corporations in East Delhi and North Delhi by running their In-Service Teacher Education Institutes and during the year under review, as many as 9,573 teachers were trained as part of this initiative. This included specially designed modules for Digital Literacy, Child Safety, Cyber Security and Mental Health that were delivered to the teachers through online sessions. Physical training sessions with teachers resumed in the last few months of the year.

MOBILE SCIENCE LAB

In order to increase the footprint of its work in Education and reach the unreached, TMF had launched a unique initiative in 2019-20. The Mobile Science Lab (MSL). For this, a Mahindra bus has been remodeled to become a science lab on wheels and has been travelling from school to school in East Delhi to provide STEM learning for children in grades 3 and 4 in these schools. The MSL program resumed its operations in 2021-22 after a break of over a year, and during the year, as many as 4,590 students and 99 teachers were benefitted.

EMPLOYABILITY

Skills-for-Market Training (SMART) is the Foundation’s flagship programme in employability. It is built on the vision of an educated, enabled and empowered India, and the belief that educated and skilled youth are the country’s true strength. The programme started with 3 Centres in 2012 and is currently running over 85 Centres at 11 locations across India. These include SMART Centres, SMART Centres (training for people with disabilities), and SMART-T Centres (training in technical trades).

In 2021-22, your Company trained 16,715 young women and men under its SMART program, of which, 1,529 were persons with disabilities. More than 70% of the graduates are placed in jobs across multiple industries upon successful completion of the training. The average salaries being earned by the graduates of the SMART program have been steadily rising and crossed the '' 12,000 per month mark for the first time.

The Foundation’s commitment to setting new benchmarks in skill development in India has been underscored by the setting up of Tech Mahindra SMART Academies, which provide the highest quality of skill training to youngsters in Healthcare and Digital Technologies. During FY 2021-22, 1,677 students were trained at the eight Academies that are now functional - 4 in Healthcare, 3 in Digital Technologies, and 1 in Logistics.

TMF’S WORK IN COVID RELIEF

As FY 2021-22 began, the country was swept by a severe second wave of COVID-19, devastating large sections of the population. Continuing the COVID relief operations of the previous year, Tech Mahindra Foundation reached out to some of the most marginalized and vulnerable communities

- distributing ration kits, cooked meals, medical equipment, masks and PPE kits. More significantly, the Foundation managed to donate 20 fully equipped ambulances and install 10 oxygen plants at various charitable hospitals. In all, the COVID relief efforts of the Foundation have impacted over 2.3 million lives in 17 States of India through a wide range of initiatives.

MAHINDRA EDUCATIONAL INSTITUTIONS (MEI)

MEI - a not-for-profit, 100% subsidiary of the Company has set up Mahindra Ecole Centrale in August 2014

- through a collaborative venture between Mahindra Educational Institutions and Ecole Centrale of Paris, France (now known as Centrale Supelec) and the JNTU Hyderabad - to offer undergraduate engineering programs. Through this strong Indo-French Collaboration with Centrale Supelec and Industry connect with Tech Mahindra, MEC has emerged as a disruptive player in the field of Technical Education.

MEI has sponsored the setting up of Mahindra University to introduce diverse streams of education in addition to Engineering.

MAHINDRA UNIVERSITY (MU)

Mahindra University ("MU”) (sponsored by Mahindra Educational Institutions, ("MEI”) - a not-for-profit, 100% subsidiary of Tech Mahindra), was notified on May 20, 2020 by the Government of Telangana vide The Telangana State Private Universities (Establishment and Regulation) Act, 2018. for "educating future citizens for and of a better world”.

In 2021-22, Mahindra University launched 3 new schools besides the existing Ecole Centrale School

of Engineering— School of Management, School of Law and Indira Mahindra School of Education. Each of these Schools will run UG, PG and Ph.D. programs. Further, the University has subsequently planned to launch School of Media & Liberal Arts and School of Design in the next 2 years.

Cornell University’s SC Johnson College of Business, an ivy league institution is the "Academic Partner” for School of Management. Mahindra University’s School of Management (MU - SoM) will benefit significantly from Cornell University’s expertise in curriculum development, faculty exchange programs including some specialty courses delivery by the Cornell faculty to Mahindra University students, as well as student immersion at Cornell.

The School of Law, Mahindra University, commenced operations in September 2021 in Hyderabad and was founded on the philosophy of securing justice, equality, and service to all sections of society. With the needs of modern society evolving rapidly, there is a renewed focus on the importance of the discipline of law. The School of Law will aim to make a difference to the legal profession and practice by providing a diverse, flexible curriculum and pedagogy, touching on several aspects of domestic and international law, while appraising the students of the latest trends in academia and practice.

Indira Mahindra School of Education (IMSE) commenced its academic activities in 2021, with the PhD program. IMSE’s vision is to be a focused training ground for the next generation of teachers and school leaders through study of education where both researchers and practitioners are developed for working in and on educational issues.

In the academic year 2021, a total of 817 students were admitted to the University - of which 757 students were in various UG programs, including School of Management and School of Law, 24 students in the PG programs of School of Engineering and 36 students in the Ph.D programs across all the schools.

The Annual Report on CSR activities is provided as "Annexure VIII”.

SUSTAINABILITY

Climate change, escalation of wars and the pandemic have forced the world to look at Sustainability as the savior of our existence. The impact of the present crises can be handled better if a Sustainable

• Being Net Zero: Committed to be Net zero well before 2040 through adoption of renewable energy, increasing the use of energy-efficient equipment & tools across operations, creating eco-design of services, optimizing the use of resources across operations and preserving the biodiversity of areas in which we operate.

• Saying No to plastic: Maintaining plastic-free campuses and encouraging associates and stakeholders to use eco-friendly & biodegradable materials. Spreading awareness and initiating campaigns on preventing single-use plastic.

• Reduce, Reuse, Recycle, Recover: Implement process of Reduce, Reuse, Recycle and Recover across the value chain to limit waste and enable a circular economy.

• Sustainable supply chain: Ensure our suppliers follow the highest standards of sustainable and ethical best practices; optimise logistics and transportation to reduce emissions.

• Work-life balance: Provide an assured career development path and a feasible and flexi work-life balance to our associates along with a range of associate-friendly policies and processes to reduce attrition.

• Fostering Diversity: Offering improved opportunities and increasing the number of women, members of the LGBQ community, and PwDs to promote a diverse culture in the organization.

• Employee engagement and recognition:

Working diligently towards Employee engagement and increasing the number of employees recognized every year.

• Innovation: Becoming future-ready by proactively encouraging Innovative thinking across the organization, adopting technology disruption, and going digital to reduce emissions. Incorporating technologies such as loT, Blockchain, AI and Machine Learning to develop a portfolio of sustainable solutions that help reduce emissions and other negative impacts of climate change.

• Green solutions: Investing in Smart grid, Microgrid-As-A-Service, Community Action

business strategy is adopted by organizations globally. Sustainability must become an integral part of business strategy and management to ensure business continuity and profitable growth.

Being forerunners in the sustainability space, Tech Mahindra’s long-term growth strategy has always had ESG principles embedded in its core to help mitigate risks and drive profitable growth. Adopting proactive strategies that are resilient in nature has been the key to our continued success. Sustainable transformation with a focus on low carbon future has helped us to quickly adapt to disruptive changes and leverage these capabilities towards business continuity and management. Tech Mahindra’s sustainability commitments across environmental, social and governance pillars span across all our business verticals and even extends to our value chain. Being an organization with purpose, we have delivered on our promise to run better, change faster and grow greater while also creating meaningful human experiences for all.

Tech Mahindra is sourcing renewable energy, using energy-efficient equipment, and optimizing operations to achieve ecological balance while investing in and pioneering new solutions for sustainable development. Tech Mahindra’s emphasis on ESG is seen in our commitment of achieving Carbon Neutrality by 2030 and being Net zero well-before 2040. We are making optimum use of resources, moving towards low-emission technologies, and taking 5-year targets for ensuring diversity, equality, and innovation, while also updating policies and procedures to maintain a robust and compliant governance.

Tech Mahindra is aligned towards the UN SDGs (Sustainable Development Goals) and its sustainability focus areas are as below:

• Going Carbon Neutral: Increasing use of renewable energy through onsite installations and open access; improving energy efficiency through installation of LEDs, sensors; boosting green investments by implementing Carbon Price; optimizing business travel by enabling virtual meetings; encouraging use of public transport and carpooling to reduce commute emissions; planting trees to offset carbon footprints; moving towards a low carbon economy to ensure environmental protection.

Platform for Energy, Integrated Electric Vehicle Charging systems (IEVCS), Smart data hubs and Smart Cities for our Customers to reduce their emissions.

• Individual Social Responsibility: encouraging associates to make sustainability a part of their day-to-day lives.

• Transparency: Reporting our organizational policies & practices, along with financial, environmental and social data in the Integrated Annual Report.

The recognitions received by Tech Mahindra are a validation of the performance towards the company’s commitments, the details of the awards & recognitions are included in Corporate Overview, kindly refer page no. 25 of this Annual Report.

The Integrated Annual Report is based on various global standards and frameworks such as TCFD (Taskforce on Climate Related Financial Disclosures), CDSB (Climate Disclosure Standards Board), SASB (Sustainability Accounting Standard Board) and GRI standards and assured by third party according to ISAE (International Standard on Assurance Engagement) 3000 standards.

Tech Mahindra discloses climate-related risks and opportunities in line with the recommendations of TCFD which focusses on the financial impact of climate-related changes on our operations.

The TechM Board owns all risks and opportunities. The MD & CEO of the Company chairs the CSR Committee of the Board and has the ultimate responsibility for Sustainability. He is ably supported by the Senior Management members of the Sustainability Council and the Chief Sustainability Officer who manage all aspects of climate change.

The pandemic has taught the Company some concrete lessons and new ways of management in order to thrive in the new post-pandemic world. Tech Mahindra has made good progress on its commitments to provide for a better and more sustainable future by embedding sustainability into its business strategy and ensuring economic recovery and business profitability. The Company strategy includes futureproofing our growth against impending

changes in policies and regulations and increasing our compliance readiness. Your Company are agile and adaptive to dynamic changes in internal and external intricacies with strategies in place to manage all business and ESG risks in an effective way. With a robust business continuity management framework and incident response team, the Company have ensured that we are resilient to any ESG risks.

The targets and the metrics used for managing climate-related & other risks and the progress against these targets are disclosed in the externally assured Integrated reports available on the website of the Company and can be accessed at https://www. techmahindra.com/en-in/sustainability/.

AWARDS AND RECOGNITION

Your Company continued its quest for excellence in its chosen area of business to emerge as a true global brand. Several awards and rankings continue to endorse your Company as a thought leader in the industry. Few of the Awards / recognitions received by the Company during the year 2021-22 include:

• Tech Mahindra recognized among the Economic Times Iconic Brands 2021.

• Tech Mahindra was declared winner of

NASSCOM Engineering & Innovation Excellence Awards 2021 for Service Delivery Excellence & Next-Gen Products for our projects on Vehicle Top Hats & Distributed Ledger DnD.

• Tech Mahindra listed among 2021 Best

Workplaces in Asia by Great Place to Work®.

• Tech Mahindra received HRH, The Prince

of Wales’ Terra Carta Seal in Recognition of the Company’s Commitment to Creating a Sustainable Future.

• Tech Mahindra won 3 Golds at the prestigious 2021 Stevie Awards for Great Employers.

• Tech Mahindra Recognized as the Fastest

Growing Organization in ‘Brand Strength’ by Brand Finance.

• Tech Mahindra emerges as the only Indian

company in the Forbes’ Blockchain 50.

• Mr. C. P. Gurnani has been recognized by The Economic Times among ‘Most Inspiring Business Leaders of Asia’ at The Economic Times 6th Edition Asia’s Promising Business Leaders.

• Tech Mahindra Included in Bloomberg Gender-Equality Index for Third Consecutive Year.

• Tech Mahindra was recognized for its pathbreaking sustainable efforts and was ranked 2nd amongst the Top 35 companies in Business world India’s Most Sustainable Companies 2022.

These awards are a reflection of the Company’s continued efforts in the fields of business, sustainability, human resource management and its sustained progress towards creating a better society for all.

ACKNOWLEDGEMENTS

Your Directors place on record their appreciation for the contributions made by employees towards the success of your Company more particularly ensuring business as usual in spite of the impact of COVID-19. Your Directors gratefully acknowledge the cooperation and support received from the shareholders, customers, vendors, bankers, regulatory and Governmental authorities in India and abroad.

For and on behalf of the Board

Anand G. Mahindra Place: Mumbai Chairman

Date: May 13, 2022 (DIN: 00004695)


Mar 31, 2022

Your Directors present the Thirty Fifth Annual Report along with the audited accounts of your Company for the year ended March 31, 2022.

FINANCIAL RESULTS (STANDALONE)

('' in Million)

For the year ended March 31

2022

2021

Income

362,489

305,627

Profit Before Interest, Depreciation and Tax

70,081

62,521

Interest

(636)

(632)

Depreciation

(6,599)

(6,623)

Profit Before Tax

62,846

55,266

Provision for Taxation

(13,715)

(12,875)

Profit After Tax

49,131

42,391

Other Comprehensive Income

1,081

2,453

Balance brought forward from previous year

200,874

184,021

Profit available for appropriation

249,753

226,432

Equity Dividends (Including tax on dividend)

(43,624)1

(19,335)2

Transfer to retained earnings on account of options lapsed

74

96

Transferred to Special Economic Zone re-investment reserve (net of utilisation)

-

(6,319)

Transferred from Special Economic Zone re-investment reserve on utilization

6,348

-

Balance carried forward

212,551

200,874

1 Interim Dividend (Special Dividend) for the Financial Year ended March 31,2022 and Final Dividend for the Financial Year ended March 31,2021

2 Interim Dividend (Special Dividend) for the Financial Year ended March 31,2021 and Final Dividend for the Financial Year ended March 31,2020

SHARE CAPITAL

During the year under review, your Company allotted 3,573,412 equity shares on the exercise of stock options under various Employee Stock Option Schemes. Consequently, the issued, subscribed and paid-up equity share capital has increased from '' 4,841 million divided into 968,260,067 equity shares of '' 5/- each to '' 4,859 million divided into 971,833,479 equity shares of '' 5/- each.

BUSINESS PERFORMANCE / FINANCIAL OVERVIEW

Tech Mahindra lives by the philosophy of creating a connected world built on connected experiences. It thrives on change powered by the intelligent symphony of technology and humans, designing both meaningful and sustainable experiences. Your Company is strongly positioned to succeed in this new normal and deliver what’s NXT.NOW for its customers. The Company has a rare combination of connectivity and experience as its endowment which, along with


DIVIDEND

The Board of Directors on October 25, 2021 approved a special dividend of '' 15/- per share (i.e. 300%) on par value of '' 5/- each which was paid by the Company to the shareholders whose names appeared in the Register of Members as on November 5, 2021, being the record date for the payment of dividend. Your Directors are pleased to recommend a final dividend of '' 30/- per share (including a special dividend of '' 15/- per share) on par value of '' 5/- (i.e. 600%), payable to those Shareholders whose names appear in the Register of Members as on the Book Closure Date. Thus, the total dividend for the F Y 202122 will be '' 45/- per share (i.e. 900%) similar to the dividend of '' 45/- per share (i.e. 900%) paid for the Financial Year 2020-21.

Your Company has formulated a Dividend Policy which is disclosed on the website of the Company and can be accessed at https://insights.techmahindra.com/ investors/tml-dividend-distribution-policy.pdf

its big bets on Cloud and engineering, form the Company’s NXT.NOW strategy.

The main components of the NXT.NOW Strategy are:

Connectivity - Modernizing networks has been our legacy for more than 25 years, serving the top global wireless communication service providers.

Experience - The Company provides award-winning and industry-leading capabilities in human-centric design.

Cloud - The Company continues to invest in rapidly scaling its partnerships and is uniquely positioned to deliver on the promise of Cloud, AI, and cyber security for its customers.

Engineering - The Company is home to leading products and software capabilities, enabled by a network of global excellence centers and top engineering talent.

During the Financial Year ended on March 31, 2022, the Company’s revenues grew to '' 446,460 million on consolidated basis as against '' 378,551 million in the previous year - indicating a robust growth of 18%. The growth was broad based across geographies as both Americas and Europe contributed in line with overall revenue growth. The Company also saw healthy growth across business segments in CME and Enterprise verticals.

The EBITDA on consolidated basis for the Financial Year 2022 was '' 80,200 million, a growth of 17% over the previous year EBITDA of '' 68,470 million. The resultant EBITDA margins were in a similar range - 18% in FY 2022 as against 18.1% in FY 2021. The post-tax profit of the Company increased by 25.7% to '' 55,661 million in FY 2022 as against '' 44,280 million in FY 2021.

The Company saw robust demand for digital transformation services with focus on customer experience and cloud. The Company has seen new deal wins of over USD 3,000 million in the previous year indicating a healthy growth momentum across all business verticals. Your Company’s investments in Enterprise SaaS and Hi-tech capabilities will help it cater to increasing modernization demands from businesses in Financial Year 2023 and beyond.

ACQUISITIONS

Your company made the following acquisitions during the financial year 2021-22.

DIGITALONUS

The Company on May 7, 2021, acquired 100% of the share capital of DigitalOnUs Inc. through its wholly owned subsidiary company Tech Mahindra (Americas) Inc. at a consideration of USD 120 million including earnouts and retention bonus. The company is headquartered in California, USA and is focused on Cloud Native Development and Hybrid Cloud Automation Services. This acquisition helped your Company in enhancing capability in Cloud Native Engineering and positioned the Company to develop cutting-edge digital solutions for its customers.

EVENTUS SOLUTIONS GROUP

The Company on June 18, 2021, acquired 100% of the share capital of Eventus Solutions Group, LLC (Eventus) through its wholly owned subsidiary company Tech Mahindra (Americas) Inc. at a consideration of USD 44 million including earnouts. Eventus is headquartered in Denver, Colorado, USA and has strong consulting capability in customer experience (CX) and customer management and enabled your Company to build an industry leading consulting practice in BPS business.

BERIS CONSULTING GMBH

The Company on October 1, 2021, acquired 100% of the share capital of Beris Consulting GmbH (Beris) through its subsidiary Company Tech Mahindra GmbH at a consideration of EUR 7 million including earnouts. Beris has 125 employees and helps your Company to unlock the transformational growth in the IT and application space for the automotive industry as a result of industry trends such as EV, Sharing & Mobility. It will also help your Company to expand its presence, hone local expertise and client relationships in the German market.

INFOSTAR LLC

The Company acquired 100% of the share capital of Infostar LLC (Lodestone) through its wholly owned subsidiary company Tech Mahindra (Americas) Inc. on October 25, 2021 at a consideration of USD 105 million including earnouts. Lodestone is headquartered in California, USA and helps your company to bolster end to end digital product engineering capabilities across design, build and test by employing Lodestone’s expertise in data strategy and providing end to end product quality assurance across hardware, software and data layers.

WE MAKE WEBSITES

The Company acquired 100% of the share capital of We Make Websites, UK through its step-down

subsidiary company Born London Limited, UK on October 25, 2021 at a consideration of GBP 9.4 million. The company is headquartered in UK and its offerings include Custom Shopify App Development, focused Ecommerce Agency, Design & UX, re-platforming, SEO & Data Migration, Headless Commerce, CRO, Performance Enhancement, Payments & Checkout, Compliance, Accessibility and O2O strategy.

BRAINSCALE

The Company on November 17, 2021, acquired 100% of the equity shares in Brainscale Inc. (Brainscale) through its wholly owned subsidiary company Tech Mahindra (Americas) Inc. at a consideration of USD 28.8 million including earnouts. Brainscale has expertise in Cloud consulting, Cloud enablement, Application Development and Data Analytics, which will bolster your company’s consulting capabilities in the Cloud transformation space and will enable your Company to drive growth of Cloud related IT services.

ACTIVUS

The Company on December 3, 2021, acquired 100% of the equity shares in Activus Connect LLC and Activus Connect PR LLC (together called as Activus) through its wholly owned subsidiary company Tech Mahindra (Americas) Inc. at a consideration of USD 62 million including earnouts. Activus is headquartered in Florida USA and has 1750 employees and is in the business of remote customer experience and customer care solution. This acquisition will help improve your company’s capability in the work from home Customer Experience Management by employing unique delivery model and disruptive platform called Smart Virtual.

ALLYIS

The Company on December 31, 2021, acquired 100% of the equity shares in Green Investments LLC (Allyis) through its wholly owned subsidiary company Tech Mahindra (Americas) Inc. at a consideration of USD 122.4 million including retention bonus and earnouts. Allyis is headquartered in Seattle, USA and has presence in US, Romania, Costa-Rica and India. The Indian subsidiary was acquired by Tech Mahindra Limited, at a consideration of USD 2.6 million. Allyis offers Technology consulting and managed services that help Organizations to reduce costs, improve performance which would help your Company’s capabilities in digital experience solutions and engineering, cloud and automation, BI and Analytics and Technical Support services.

CTC

The Company on January 17, 2022, acquired 100% of the equity shares in Com Tech Co IT Limited (CTC) through its wholly owned subsidiary company Tech Mahindra London Limited at a consideration of EUR 310 million including earnouts. CTC has 720 employees and is a specialized digital engineering and outsourced product development organization with development centers in Latvia and Belarus. It offers high-end-digital engineering services to some of the largest insurance and reinsurance organisations globally. Your Company also acquired 25% equity shares each in SWFT Technologies and Surance Ltd which are early stage InsurTech SaaS ventures with a proven technology.

GEOMATIC.AI

The Company acquired 80% of the share capital of Geomatic.AI Pty Ltd, Australia through its wholly owned subsidiary company Tech Mahindra (Singapore) Pte. Ltd on February 15, 2022 at a consideration of A$6 million. Geomatic.AI is headquartered in Australia and its offerings include digital platforms led nonlinear growth in partnership with AusNet Services an Australian Energy & Utilities distributor and will build digital twins for linear assets leveraging Cloud, Drone and Mobility technologies in the Geospatial domain.

DETAILS OF SUBSIDIARIES / JOINT VENTURES / ASSOCIATE COMPANIES

The performance and financial position of the subsidiaries, associate and joint venture companies included in the consolidated financial statement is provided in accordance with the provisions of Section 129 read with Rule 5 of the Companies (Accounts) Rules, 2014 containing the salient features of the financial statement of the Company’s subsidiaries/joint ventures or associate companies in Form AOC - 1 in "Annexure I” to this report.

Pursuant to Rule 8(5)(iv) of the Companies (Accounts) Rules, 2014, the names of the companies which have been incorporated or ceased to be the subsidiaries, joint ventures or associate companies during the year are provided in "Annexure II” to this report. The Company is actively pursuing the initiative on the consolidation of its subsidiaries/branches to optimize the operational costs. During the year under review, your Company has closed/merged fourteen subsidiaries.

In terms of the provisions of Regulation 24 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations 2015, Tech Mahindra (Americas) Inc. is a wholly owned unlisted material subsidiary of the Company.

The policy for determining material subsidiaries formulated by the Board of Directors is disclosed on the website of the Company and can be accessed at https://insights.techmahindra.com/investors/Policy-For-Determining-Material-Subsidiaries.pdf

UPDATE ON MERGER

The Board of Directors at its meeting held on January 31, 2021 approved the Scheme of Merger of Tech Mahindra Business Services Ltd and Born Commerce Private Ltd with the Company. Accordingly, the companies filed the petitions before the Hon’ble National Company Law Tribunal (NCLT), Mumbai and Chennai Benches respectively. The petitions are pending for final hearing as on the date of this Report.

HUMAN RESOURCES

The employees of the Company are the most critical asset to your Company. The Company has taken several steps to protect, retain, and improve the competencies of these assets including:

Hiring: War for Talent

Your Company responded to the ‘Great Resignation’ by adopting many innovative practices such as remote hiring, hybrid working, productivity to the engagement of remote workforce. With no location constraints, your Company could hire diverse talent including stay-at-home women, retired professionals, Persons with Disabilities (PwDs), gig workers, and more. Through the NXT.Town program, your Company started small centres in Tier-II and Tier-III cities across India to proactively look beyond set boundaries and focus on skill-based hiring in emerging technologies. Your Company is also committed to diversifying talent hiring at global delivery centres to improve local customer connect. Your Company has restructured its referral and campus recruitment programs to actively encourage hiring at the ‘bottom of the pyramid’. The Digital RMG platform has helped your Company proactively hire based on forecasted demand through a custom-built applicant tracking system that allows collaborative hiring and improves the candidate experience.

Learning: Build v/s Buy Talent

At your Company, learning plays a strategic role in the achievement of business goals by facilitating upskilling and creating a future-ready workforce, all the while fulfilling its associates’ career aspirations. In order to enable end-to-end digital transformation for global customers, your Company is building skills and keeping its talent pool brimming with new-age technologies. By offering skill-based and accelerated career movement allowance through the Career Acceleration Policy, your Company is encouraging niche skilling, thus creating a win-win situation. Your Company has launched a Cloud Finishing School for creating project-ready talent in Cloud technologies to fulfil business needs. After the success of the EMBARK capability building program for Program Managers, your Company has started an Architect COE for solution and technical architects who work on digital transformation. In an effort to build a roster of young and diverse leadership, the Company has launched focused young leader and women leader programs, with an emphasis on deploying them into new roles once their learning journey is complete. The Company has also partnered with Harvard to offer bite-sized learning content via the Harvard Manager Mentor (HMM) SPARK platform. Your Company continues to leverage its #NAD Learn platform to create full-stack professionals through initiatives like fresher-skilling, project-skilling, future-skilling and bench-skilling (Competence to Deployment) to create future-ready talent, in line with its NXT.NOW philosophy.

Leadership: Extreme Ownership

The natural culture of empowerment at your Company was supercharged during the pandemic as associates took ownership for their deliverables and leaders at all levels were an integral part of the decision-making process. The Leadership team of the Company aims to imbibe the following atomic habits -alternate thinking, bias for action, closure over followup, data over emotions and extreme ownership. This was reinforced through the adoption of a real-time Performance Management Dashboard for the 300 talent-to-value business leaders whose continuous executive coaching and performance management was instrumental in your Company meeting its financial and strategic goals. Apart from coaching, the Leaders at the Company have also had the opportunity to experience new forms of learning with technology-enabled pedagogies like habit builders, qubit

thinking, cinema-based learning, gamification etc. The Company also launched the Leadership Retreat, an eight-day-long learn-as-you-work residential program to replenish the physical, emotional, cognitive, and social energies of mid and senior level leaders.

Performance: Outcome-Driven

Your Company launched the Annual Performance Feedback cycle in December 2021 and has completed its performance appraisal. Aspiring to build a culture where performance is enabled through feedback, managers have been trained to engage in better performance review dialogues with their direct reports and work on an outcome-based evaluation, rather than process or effort measurement. Your Company is creating a high-performance culture through hyper-personalized incentive plans. Your Company has a suite of incentive plans that are designed to create a strong alignment between individual wealth creation and organizational performance. In addition to broad-based incentive plans, your Company has also customized quarterly sprint incentives which create avenues for instant gratification for associates across the front, middle, back offices as well as enabling functions, thereby inculcating a spirit of collaboration. With platforms like Talex, #NAD Learn and a revamped job rotations policy, your Company continued to improve internal mobility.

Wellness: Holistic Wellbeing

The ‘Wellness Before Business’ mantra followed by your Company has ensured the collective well-being and safety of its entire ecosystem of stakeholders, including associates, customers, and partners. The Wealth of Wellness (WoW) program ensures preventive, personalized, and proactive holistic wellness across all 8 dimensions of wellness including physical, mental, emotional, and financial parameters. The Company has launched new policies like the Bereavement Support for Dependents (COVID Support) Policy, Sabbatical Leave Policy, and more in response to the unique challenges posed by the pandemic. Your Company also provided financial security and crucial support through the Associate Welfare Trust for 190 associates, disbursing '' 2.8 crores. To highlight the importance of physical well-being, your Company launched the Wellness 101 Challenge as well as the Run Anywhere virtual marathon to engage its associates who predominantly worked from home and encouraged them to reclaim their fitness. Mental well-being was prioritized through initiatives like the Mind Plan, People Care Manager Program and the Emotional Wellness Self-Assessment.

Pandemic: #ResolveToRise

#ResolveToRise was an organization-wide campaign by the Company, rallying associates to embrace the Rise credo and encouraging them to stay strong by sharing inspiring stories and initiatives from the ground, including COVID warriors assisting those in need, Company-led innovations using #TechForGood to help the most vulnerable, community-wide volunteering efforts, and more. During the pandemic, the Company also setup a COVID-19 Support Fund, providing much-needed relief to affected families, setting up oxygen plants and donating ambulances to charitable hospitals. Your Company also setup COVID care centres at five major locations to help both associates and the larger community. Through the SOS Seva, your Company helped patients access critical care including hospital beds, oxygen cylinders, oxygen concentrators, medicines, and plasma. Through a series of vaccination drives, your Company has encouraged protection and prevention, vaccinating associates, their family members, and other third-party staff.

Communication: Building Purpose

Through effective internal communications, your Company ensures that the connected purpose of the organisation is communicated to all associates, thus reiterating the core philosophy of the brand: creating a connected world with connected experiences. With hybrid working being the norm, your Company has made virtual connectedness a way of life through various digital initiatives that were purpose-led, peoplecentric, and performance-driven. Multiple mediums were used to reach out to associates including social media, e-chats, emailers, campaigns, screensavers and more. With a 360-degree-communication approach, your Company has built a culture that is based on celebration, positive change, and the credo of Rise which has resulted in a unifying pride for the Company - their #LoveToBeTechM.

Diversity: Being Yourself

Your Company considers ‘diversity of people’, ensuring ‘equitable opportunities’ and ‘inclusion at the workplace’ as an instrument of growth. This has reflected in the definition of the new vision statement of your Company. The earlier Vision 2021 was about fostering innovation and that comes from ‘diversity of thought’. The new Vision 2024 is about creating a purpose-led company. Your Company is committed to pursuing ‘Purpose beyond Profits’ by embedding Environmental, Social and Governance

Engagement: TechM CARES Survey

Your Company has taken active steps to build remote engagement by creating virtual ‘water-cooler’ moments and updating policies in line with the ‘new normal’. To ensure that associates were continuously engaged through the right channels and received the right information at the right time, your Company followed the 4C model - Connect, Collaborate, Career, and Celebrate. Associates have expressed their confidence and delight through the TechM CARES survey where your Company has secured an overall rating of 4.58/5 - the highest score in its history. This engagement score represents a 54 basis points increase over the last survey score of 4.04/5 and reinforces your Company’s commitment to create human-centered experiences for its associates.

QUALITY

The Company continues its focus on quality and strives to exceed customer expectations at all times. During the year, it continued to strengthen the implementation of Quality systems and upgraded various processes to comply with CMMI V 2.0 for both Dev and Services. The Organization is recently assessed at Level 5 maturity. Similarly it underwent various upgrade and re-certification audits for multiple standards during the year in order to meet client demands and enhance value delivery. The Company has Successfully re-certified, ISO 9001:2015 (Quality Management System), ISO 20000-1:2018 (Information Technology Service Management System), ISO 27001:2013 (Information Security Management System), ISO 27701:2019 (Privacy Information Management System), TL9000 R 6.2/ R5.7 (Quality Management Systems for Tele Communications industry), ISO 13485:2016 (Quality Management Systems for medical devices - scope of certification limited to medical devices business within Tech Mahindra), AS9100 Rev D (Standard for Aerospace domain - scope of certification limited to the aerospace business within Tech Mahindra), ISO 17025:2017 - Laboratory Quality Management Systems for device testing labs.

In addition to these, your Company also maintains its commitment to health, safety and environment by continually improving its processes in accordance with ISO 14001:2015 (Environmental Management System) and ISO 45001: 2018 (Occupational Health and Safety Assessment Series) standards. Your Company is also certified on ISO 22301:2012 (Societal Security and

(ESG) principles into its core strategy, thus creating a long-term positive impact on the planet and society while providing greater value for all its stakeholders. Improvements in Diversity, Equity and Inclusion practices is critical to improve the Social aspect of ESG, and hence your Company has defined a roadmap for improvements across the dimensions of Gender, Generation, People with Disabilities, the LGBTQ community as well as cultures and nationalities. This also links back to the stated objective of your Company to be human-centered by encouraging associates to bring their most authentic selves to work.

Recognition: People at the Core

While timely recognition is key to a happy workforce, your Company also prioritizes creating a culture of appreciation. Your Company’s robust digital platform ensures both recognition and appreciation with monetary and non-monetary rewards badges linked to redemption points. Your Company also encourages its associates to donate their reward points towards social causes and has an industryleading rewards penetration of approximately 40%. To celebrate achievements in the virtual world, your Company introduced the quarterly Spotlight awards and other timely sales- focused awards to reward growth, collaboration, and high-impact initiatives. Your Company also included associates’ family members to virtually felicitate both Long Service Awardees and ACERs (consistent performers for two years) for their outstanding contributions and commitment.

HR Digitization: Automation at every Step

Your Company has continued to invest in its flagship product, ‘Dove,’ for new joiners, enabling new capabilities for document submissions and personal information updates. Your Company has continued to enhance self-service capabilities for existing associates in diverse areas such as letter generation, work permits, automated approvals, and proactive notifications for key events. Your Company has adopted Office 365 as well as the Enate and UNO platforms to automate routine business transactions through BOTs. Your Company has also taken steps to improve the post-joining and pre-exit processes to improve communication as a step towards empowering associates with the right information. Your Company has also leveraged Artificial Intelligence/ Machine learning to build internal applications to provide associates with customer-like experiences.

Business Continuity Management System) and has a comprehensive Business Continuity and Disaster Recovery framework, to prevent potential business disruptions in the event of any disaster. The Company has processes that helped resume services to customer’s acceptable service levels. Automated Service Desk with SLAs for enabling business and Vulnerability Assessment and Penetration Testing Lab for secured corporate network operations are highlights that showcase the information security posture of the Organization.

During the second year of the pandemic, the entire quality management system was put to test with majority of the associates working from home. Complying with the Company’s security requirements, they were able to deliver services as per contractual commitments, leading to great customer satisfaction.

Tech Mahindra (IT Division) has been assessed for the implementation of high maturity business excellence practices at Mahindra Group (Services Sector). It has been assessed at TMW Maturity Stage 7 (on scale of 1-10 stages) of Mahindra Business Excellence Framework - The Mahindra Way. These certifications are testimony of the robustness of business processes and at large the quality culture imbibed in the organization.

Your Company has continued to strengthen the process for transforming Quality Assurance processes & delivery methods to adopt and strengthen Delivery excellence, Risk governance, and further enhance automation to enable quality delivery to the customer. Quality index which is a measure of quality of products and services delivery is institutionalized.

All these actions are being taken to ensure that the Company deliver as stated in its Quality Policy.

DIRECTORS

During the year under review, all Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Independent Directors have also given declaration of compliance with Rules 6(1) and 6(2) of the Companies (Appointment and Qualification of Directors) Rules, 2014, with respect to

their name appearing in the data bank of Independent Directors maintained by the Indian Institute of Corporate Affairs.

Pursuant to the provisions of Section 152(6)(c) of the Companies Act, 2013, Mr. C. P. Gurnani, Managing Director & CEO (DIN: 00018234) is liable to retire by rotation and offers himself for reappointment.

Further the term of Mr. C. P. Gurnani as Managing Director & CEO expires on August 9, 2022. The Board of Directors based on the recommendation of Nomination and Remuneration Committee considering the performance of the Managing Director & CEO over the last 10 years & his contribution to the growth of the Company approved and recommends the re-appointment of Mr. C. P. Gurnani as Managing Director & CEO for another term from August 10, 2022 upto December 19, 2023, which is his date of retirement from the Company, subject to the approval of shareholders at the ensuing Annual General Meeting.

Your Directors co-opted Ms. Penelope Fowler (DIN: 09591815) as an Additional Director with effect from May 13, 2022. The term of Ms. Fowler will end at the ensuing Annual General Meeting. As Ms. Penelope Fowler meets the criteria of an Independent Director, the Board recommends her appointment as an Independent Director for a period of 5 years for the approval of shareholders at the ensuing Annual General Meeting.

Mr. M. Damodaran (DIN: 00125299) has retired as an Independent Director of the Company with effect from March 31, 2022. Your Board places on record its sincere appreciation for the valuable contribution and timely guidance from Mr. M. Damodaran to the Company during his tenure.

In terms of Regulation 24(1) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations 2015, Mr. T. N. Manoharan, Lead Independent Director of the Company has been appointed as Director on the Board of Tech Mahindra (Americas) Inc., a wholly owned unlisted material subsidiary of the Company with effect from May 21, 2019.

In the opinion of the Board of Directors the Independent Directors have relevant proficiency, expertise and experience.

i. Policy on the appointment and removal of Directors, Key Managerial Personnel and Senior Management.

ii. Policy on remuneration to the Directors, Key Managerial Personnel and Senior Management and other Employees.

The extract of these two policies is provided in "Annexure III''

The policies are available on the website of the Company and can be accessed at https://insights. techmahindra.com/investors/Governance-Policies-including-remuneration-to-Directors-KMPS.pdf

SUCCESSION PLAN

In accordance with the principles of transparency and consistency, your Company has adopted governance policies for appointments, remuneration and evaluation of its Board of Directors, Key Managerial Personnel & Senior Management. In line with these Governance policies, the Company has established a formal Succession Planning Program for key managerial persons across the organization. The Board evaluates all such plans at a regular interval and institutes a formal program for filling any such critical position. The Board evaluates both internal and external candidates for such positions alongwith the recommendations of the Company. The Company also has a leadership development program where it identifies high potential managers, and trains them to take up the positions of higher responsibility. The Company has identified the second line of leadership, which provides stability to the business in any contingencies.

TRAINING

The Company has laid down a policy on the training of Independent Directors as part of its governance policies. The Senior Leadership of the Company periodically updates the Directors on regulatory changes, business strategy and the Company has laid down a policy on the training of Independent Directors as part of its governance policies. The Senior Leadership of the Company periodically updates the Directors on regulatory changes, business strategy and operations.

KEY MANAGERIAL PERSONNEL (KMP) Pursuant to provisions of Section 203 of the Companies Act, 2013, Mr. C. P Gurnani, Managing Director & Chief Executive Officer, Mr. Manoj Bhat, Chief Financial Officer (up to April 1, 2021), Mr. Milind Kulkarni,


FAMILIARISATION PROGRAMME

These programmes aim to provide insights into the Company to enable the Independent Directors to understand its business in depth and contribute significantly to the Company. The details of program for familiarisation of the Independent Directors with the Company are available on its website and can be accessed at https://insights.techmahindra.com/ investorsltml-familarisation-progarmmes-for-IDs.pdf

The Board members are also regularly updated on changes in statutory provisions like changes in Corporate Laws, SEBI Regulations, Taxation Laws and People related laws as applicable at the quarterly Board meetings. The Board members are also updated on the Risk universe applicable to the Company’s business. The MD & CEO of the Company had quarterly sessions with Board members sharing updates about the Company’s business strategy, operations and the key trends in the IT industry that are relevant to the Company. These updates help the Board members in keeping abreast of key changes and their impact on the Company.

BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and Regulation 19 read with Schedule II, Part D of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has devised a policy on evaluating the performance of the Board of Directors, the Chairman, Committees, and Individual Directors. The evaluation process was carried out through a web-based portal. The summary of the evaluation reports was presented to the respective Committees and the Board. The Directors had given a positive feedback on the overall functioning of the Committees and the Board. The suggestions made by the Directors in the evaluation process have been suitably incorporated in the processes.

NUMBER OF MEETINGS OF THE BOARD

The Board met four times during the Financial Year 2021-22. The meeting details are provided in Corporate Governance report that forms part of this Annual Report. The maximum interval between any two meetings did not exceed 120 days as prescribed in the Companies Act, 2013 and SEBI Listing Regulations.

POLICY ON DIRECTORS’ APPOINTMENT AND REMUNERATION

The Governance policies laid down by the Board of Directors of your Company include:

are adequate for ensuring the orderly and efficient conduct of the business, including adherence to the Company’s policies, the safe guarding of assets, the prevention and detection of frauds and errors, the accuracy and completeness of accounting records and timely preparation of reliable financial information.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS / PROCEEDINGS

There are no significant and material orders passed by the regulators or courts or tribunal impacting the going concern status and the Company’s operations in the future.

Further no application against the Company has been filed or is pending under the Insolvency and Bankruptcy Code, 2016, nor the Company has done any one time settlement with any Bank or Financial institutions.

STATUTORY AUDITORS

The members, in the 30th Annual General Meeting (AGM) held on August 1, 2017, appointed

M/s. B S R & Co. LLP, Chartered Accountants, [ICAI Firm’s Registration No. 101248W/W- 100022] as the Statutory Auditors of the Company, to hold office for a term of five years from the conclusion of the 30th AGM of the Company held in the Financial Year 2017-18 until the conclusion of the AGM of the Company for the Financial Year 2021- 22 on such remuneration as may be determined by the Board of Directors.

Pursuant to Section 139 of the Companies Act, 2013 the Statutory Auditors M/s. B S R & Co. LLP, Chartered Accountants have confirmed that they are eligible to continue as auditors.

In accordance with provision of Section 139 of the Companies Act, 2013 read with Rules framed thereunder, the Board of Directors of the Company on the recommendation of the Audit Committee, proposes appointment of M/s. B SR & Co. LLP, Chartered Accountants (ICAI Firm’s Registration No. 101248W/W - 100022) as Statutory Auditors of the Company to hold office from the conclusion of ensuing 35th AGM for a term of five consecutive years till the conclusion of 40th AGM. The appointment of M/s. B S R & Co. LLP as the statutory auditors of the Company is placed before the members for approval at the ensuing AGM.

As required under provision of Section 139(1) of the Companies Act, 2013 the Company has received a written consent from M/s. B S R & Co. LLP for their

Chief Financial Officer (w.e.f. April 2, 2021) and Mr. Anil Khatri, Company Secretary & Compliance Officer were the Key Managerial Personnel of the Company during the year under review. Mr. Milind Kulkarni will retire as Chief Financial Officer of the Company w.e.f. May 31, 2022 and Mr. Rohit Anand was appointed as Chief Financial Officer of the Company w.e.f. June 1, 2022.

DIRECTORS’ RESPONSIBILITY STATEMENT

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

i. in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

ii. they have, in the selection of the accounting policies, consulted the Statutory Auditors and these have been applied consistently and, reasonable and prudent judgments and estimates have been made so as to give a true and fair view of the state of affairs of the Company as at March 31, 2022 and of the profit of the Company for the year ended on that date;

iii. proper and sufficient care had been taken 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 other irregularities;

iv. the annual accounts have been prepared on a going concern basis;

v. they had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively;

vi. the proper systems to ensure compliance with the provisions of all applicable laws are in place and are adequate and operating effectively.

DETAILS WITH RESPECT TO ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS

The Company has internal financial controls which are adequate and were operating effectively. The controls appointment and a certificate to the effect that their appointment, if made, would be in accordance with the Companies Act, 2013 and the Rules framed thereunder and that they satisfy the criteria provided in Section 141 of the Companies Act, 2013 read with Rule 4(1) of the Companies (Audit and Auditors) Rules, 2014 and that they are not disqualified for appointment as statutory auditors of the Company.

There are no qualifications, reservations, adverse remarks or disclaimer made in the audit report for the Financial Year 2021-22.

SECRETARIAL AUDIT REPORT

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 had appointed Mr. Makarand Lele & Co., Practicing Company Secretary, Pune to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is available at ‘Annexure IV” to this report. There are no qualifications, reservations, adverse remarks or disclaimer made in the Secretarial Audit Report.

COMPLIANCE WITH SECRETARIAL STANDARDS

The Company has complied with the applicable Secretarial Standards.

ANNUAL RETURN

Pursuant to the provisions of Section 92(3) read with Section 134(3) (a) of the Companies Act, 2013, the Annual Return in Form MGT-7 is available on the website of the Company and can be accessed at https://insights.techmahindra.com/investors/mgt7-annual-return-2021-22.pdf

MANAGERIAL REMUNERATION

Disclosures of the ratio of the remuneration of each director to the median employee’s remuneration and other details as required pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended from time to time, are provided as "Annexure V”.

None of the directors or Managing Director & CEO of the Company, received any remuneration or commission from Subsidiary Companies of your Company.

The details of remuneration paid to the Directors including the Managing Director & CEO of the Company is provided in Corporate Governance Report.

PARTICULARS OF EMPLOYEES

The information required under Section 197(12) of the Companies Act, 2013 ("the Act”) read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms part of this Report. However, pursuant to first proviso to Section 136(1) of the Act, this Report is being sent to the Shareholders excluding the aforesaid information. Any shareholder interested in obtaining said information, may write to the Company Secretary at the Registered Office / Corporate Office of the Company and the said information is open for inspection at the Registered Office of the Company.

POLICY ON PREVENTION OF SEXUAL HARASSMENT

Your Company laid down the Prevention of Sexual Harassment (POSH) policy which is available on its website. The Company has zero tolerance on Sexual Harassment at workplace. During the year under review there were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

The status of complaints received under POSH and redressed by the POSH Committee of the Company, during the Financial Year under review, are given below:

a) Number of complaints received - 45

b) Number of complaints redressed - 43

c) Number of complaints pending - 2

There are focused campaigns on the POSH policy within the Company and awareness drives that take place with the help of its BPS teams. Furthermore, the employees are required to undertake a mandatory annual certification on POSH to sensitize themselves and strengthen their awareness.

EMPLOYEE STOCK OPTION SCHEMES

During the year under review, there were no material changes in the Employee Stock Option Schemes (ESOPs) of the Company and the Schemes are in compliance with the SEBI Regulations on ESOPs.

As per Regulation 14 of Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021, the details of the ESOPs are uploaded on the website of the Company and can be accessed at https://insights.techmahindra. com/investors/Details-of-ESOPs-FY-2021-22.pdf

CORPORATE GOVERNANCE

A report on Corporate Governance covering among others composition, details of meetings of the Board and Committees along with a certificate for compliance with the conditions of Corporate Governance in accordance with the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, issued by the Statutory Auditors of the Company, forms part of this Annual Report.

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.

COST RECORDS

Maintenance of cost records and requirement of cost audit as prescribed under the provisions of Section 148(1) of the Companies Act, 2013 are not applicable for the business activities of the Company.

RISK MANAGEMENT

The Risk Management Committee of the Board of Directors guides the operating management to identify risks, analyze their probability and impact and prepare mitigation plans. It periodically reviews the Risk Management Framework & Enterprise Risk Register which is presented by the Chief Risk Officer. The Company identifies all potential risks viz. economical, business, currency, operational, climate, governance, financial, cyber, business continuity etc. and prepares a mitigation plan for each of the risks. The elements of risk as identified by the Company with the impact and mitigation strategy are set out in the Management Discussion and Analysis Report (MDA).

ESTABLISHMENT OF VIGIL MECHANISM

The Company has laid down Whistle Blower Policy covering Vigil Mechanism with protective Clauses for the Whistle Blowers. The Whistle Blower Policy is made available on the website of the Company.

DEPOSITS / LOANS & ADVANCES, GUARANTEES OR INVESTMENTS

The Company has not accepted any deposits from the public during the year under review. The particulars of loans/advances, guarantees and investments under Section 186 of the Companies Act, 2013 are given in the notes forming part of the Financial Statements.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All transactions entered into with Related Parties as defined under Section 2(76) of the Companies Act, 2013 and Regulation 23 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, ("The Listing Regulations”), during the Financial Year under review were in the ordinary course of business and at an arm’s length pricing basis and do not attract the provisions of Section 188 of the Companies Act, 2013. There were no transactions with related parties in the Financial Year which were in conflict with the interest of the Company and requiring compliance of the provisions of Regulation 23 of the Listing Regulations.

Suitable disclosure as required by the Indian Accounting Standards (Ind AS 24) has been made in the notes forming part of the Financial Statements.

The Company has formulated a policy on the materiality of Related Party Transactions and dealing with Related Party Transactions which has been uploaded on the website of the Company and can be accessed at https://insights.techmahindra.com/investors/Related-Party-Transactions-Policy.pdf

The particulars of related party transactions in prescribed Form AOC - 2 are attached

as ‘Annexure VI”.

Pursuant to Regulation 23(9) of the Listing Regulations, your Company has filed half yearly report on Related Party Transactions with the stock exchanges.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars as prescribed under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 are provided in “Annexure VII” which forms part of this report.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

The CSR vision of the Company is "Empowerment through Education.”

In compliance with the guidelines prescribed under Section 135 of the Companies Act, 2013, your Company has constituted a Corporate Social Responsibility (CSR) Committee of the Board. The CSR policy, covering the Objectives, Focus Areas, Governance Structure Monitoring and Reporting Framework among others is approved by the Board of Directors. In accordance with the amendments made in Section 135 in January 2021, the CSR Policy has been duly revised and is available on the website of the Company and can be accessed at https://files. techmahindra.com/static/img/pdf/csr-policy-techm-v3-march2021.pdf

The Company has spent more than 2% of the average net profits of the Company during the three immediately preceding Financial Years on CSR.

The Company’s social initiatives are mainly carried out by Tech Mahindra Foundation and Mahindra Educational Institutions, Section 8 (erstwhile Section 25) Companies promoted by the Company.

TECH MAHINDRA FOUNDATION (TMF) EDUCATION

The key initiatives taken by TMF in the arena of school education include:

ALL ROUND IMPROVEMENT IN SCHOOL EDUCATION (ARISE)

Tech Mahindra Foundation’s educational initiatives under ARISE are long-term school improvement programmes, in partnership with local governments and partner organisations. The Foundation in 2021-22 worked with 18 government primary schools to transform them into model schools of excellence. A total of 4,928 students were positively impacted under this programme, of which 2,646 were girls.

During the year, the Foundation expanded its work for children with special needs through its ARISE programme. This programme is a variant of ARISE in which children with special needs are provided chronic therapy as well as special education to help them lead more fulfilling lives. Through 28 projects, the programme enabled 3,792 children with special needs to become better learners with greater independence in managing their lives. The Foundation is also working

with some of the most committed NGOs in the disability sector to positively impact even more children.

SHIKSHAANTAR

Shikshaantar, envisioned as a programme for enhancing capacity of government school teachers, has emerged as an important programme in the education portfolio of the Foundation. TMF works with the Municipal Corporations in East Delhi and North Delhi by running their In-Service Teacher Education Institutes and during the year under review, as many as 9,573 teachers were trained as part of this initiative. This included specially designed modules for Digital Literacy, Child Safety, Cyber Security and Mental Health that were delivered to the teachers through online sessions. Physical training sessions with teachers resumed in the last few months of the year.

MOBILE SCIENCE LAB

In order to increase the footprint of its work in Education and reach the unreached, TMF had launched a unique initiative in 2019-20. The Mobile Science Lab (MSL). For this, a Mahindra bus has been remodeled to become a science lab on wheels and has been travelling from school to school in East Delhi to provide STEM learning for children in grades 3 and 4 in these schools. The MSL program resumed its operations in 2021-22 after a break of over a year, and during the year, as many as 4,590 students and 99 teachers were benefitted.

EMPLOYABILITY

Skills-for-Market Training (SMART) is the Foundation’s flagship programme in employability. It is built on the vision of an educated, enabled and empowered India, and the belief that educated and skilled youth are the country’s true strength. The programme started with 3 Centres in 2012 and is currently running over 85 Centres at 11 locations across India. These include SMART Centres, SMART Centres (training for people with disabilities), and SMART-T Centres (training in technical trades).

In 2021-22, your Company trained 16,715 young women and men under its SMART program, of which, 1,529 were persons with disabilities. More than 70% of the graduates are placed in jobs across multiple industries upon successful completion of the training. The average salaries being earned by the graduates of the SMART program have been steadily rising and crossed the '' 12,000 per month mark for the first time.

The Foundation’s commitment to setting new benchmarks in skill development in India has been underscored by the setting up of Tech Mahindra SMART Academies, which provide the highest quality of skill training to youngsters in Healthcare and Digital Technologies. During FY 2021-22, 1,677 students were trained at the eight Academies that are now functional - 4 in Healthcare, 3 in Digital Technologies, and 1 in Logistics.

TMF’S WORK IN COVID RELIEF

As FY 2021-22 began, the country was swept by a severe second wave of COVID-19, devastating large sections of the population. Continuing the COVID relief operations of the previous year, Tech Mahindra Foundation reached out to some of the most marginalized and vulnerable communities

- distributing ration kits, cooked meals, medical equipment, masks and PPE kits. More significantly, the Foundation managed to donate 20 fully equipped ambulances and install 10 oxygen plants at various charitable hospitals. In all, the COVID relief efforts of the Foundation have impacted over 2.3 million lives in 17 States of India through a wide range of initiatives.

MAHINDRA EDUCATIONAL INSTITUTIONS (MEI)

MEI - a not-for-profit, 100% subsidiary of the Company has set up Mahindra Ecole Centrale in August 2014

- through a collaborative venture between Mahindra Educational Institutions and Ecole Centrale of Paris, France (now known as Centrale Supelec) and the JNTU Hyderabad - to offer undergraduate engineering programs. Through this strong Indo-French Collaboration with Centrale Supelec and Industry connect with Tech Mahindra, MEC has emerged as a disruptive player in the field of Technical Education.

MEI has sponsored the setting up of Mahindra University to introduce diverse streams of education in addition to Engineering.

MAHINDRA UNIVERSITY (MU)

Mahindra University ("MU”) (sponsored by Mahindra Educational Institutions, ("MEI”) - a not-for-profit, 100% subsidiary of Tech Mahindra), was notified on May 20, 2020 by the Government of Telangana vide The Telangana State Private Universities (Establishment and Regulation) Act, 2018. for "educating future citizens for and of a better world”.

In 2021-22, Mahindra University launched 3 new schools besides the existing Ecole Centrale School

of Engineering— School of Management, School of Law and Indira Mahindra School of Education. Each of these Schools will run UG, PG and Ph.D. programs. Further, the University has subsequently planned to launch School of Media & Liberal Arts and School of Design in the next 2 years.

Cornell University’s SC Johnson College of Business, an ivy league institution is the "Academic Partner” for School of Management. Mahindra University’s School of Management (MU - SoM) will benefit significantly from Cornell University’s expertise in curriculum development, faculty exchange programs including some specialty courses delivery by the Cornell faculty to Mahindra University students, as well as student immersion at Cornell.

The School of Law, Mahindra University, commenced operations in September 2021 in Hyderabad and was founded on the philosophy of securing justice, equality, and service to all sections of society. With the needs of modern society evolving rapidly, there is a renewed focus on the importance of the discipline of law. The School of Law will aim to make a difference to the legal profession and practice by providing a diverse, flexible curriculum and pedagogy, touching on several aspects of domestic and international law, while appraising the students of the latest trends in academia and practice.

Indira Mahindra School of Education (IMSE) commenced its academic activities in 2021, with the PhD program. IMSE’s vision is to be a focused training ground for the next generation of teachers and school leaders through study of education where both researchers and practitioners are developed for working in and on educational issues.

In the academic year 2021, a total of 817 students were admitted to the University - of which 757 students were in various UG programs, including School of Management and School of Law, 24 students in the PG programs of School of Engineering and 36 students in the Ph.D programs across all the schools.

The Annual Report on CSR activities is provided as "Annexure VIII”.

SUSTAINABILITY

Climate change, escalation of wars and the pandemic have forced the world to look at Sustainability as the savior of our existence. The impact of the present crises can be handled better if a Sustainable

• Being Net Zero: Committed to be Net zero well before 2040 through adoption of renewable energy, increasing the use of energy-efficient equipment & tools across operations, creating eco-design of services, optimizing the use of resources across operations and preserving the biodiversity of areas in which we operate.

• Saying No to plastic: Maintaining plastic-free campuses and encouraging associates and stakeholders to use eco-friendly & biodegradable materials. Spreading awareness and initiating campaigns on preventing single-use plastic.

• Reduce, Reuse, Recycle, Recover: Implement process of Reduce, Reuse, Recycle and Recover across the value chain to limit waste and enable a circular economy.

• Sustainable supply chain: Ensure our suppliers follow the highest standards of sustainable and ethical best practices; optimise logistics and transportation to reduce emissions.

• Work-life balance: Provide an assured career development path and a feasible and flexi work-life balance to our associates along with a range of associate-friendly policies and processes to reduce attrition.

• Fostering Diversity: Offering improved opportunities and increasing the number of women, members of the LGBQ community, and PwDs to promote a diverse culture in the organization.

• Employee engagement and recognition:

Working diligently towards Employee engagement and increasing the number of employees recognized every year.

• Innovation: Becoming future-ready by proactively encouraging Innovative thinking across the organization, adopting technology disruption, and going digital to reduce emissions. Incorporating technologies such as loT, Blockchain, AI and Machine Learning to develop a portfolio of sustainable solutions that help reduce emissions and other negative impacts of climate change.

• Green solutions: Investing in Smart grid, Microgrid-As-A-Service, Community Action

business strategy is adopted by organizations globally. Sustainability must become an integral part of business strategy and management to ensure business continuity and profitable growth.

Being forerunners in the sustainability space, Tech Mahindra’s long-term growth strategy has always had ESG principles embedded in its core to help mitigate risks and drive profitable growth. Adopting proactive strategies that are resilient in nature has been the key to our continued success. Sustainable transformation with a focus on low carbon future has helped us to quickly adapt to disruptive changes and leverage these capabilities towards business continuity and management. Tech Mahindra’s sustainability commitments across environmental, social and governance pillars span across all our business verticals and even extends to our value chain. Being an organization with purpose, we have delivered on our promise to run better, change faster and grow greater while also creating meaningful human experiences for all.

Tech Mahindra is sourcing renewable energy, using energy-efficient equipment, and optimizing operations to achieve ecological balance while investing in and pioneering new solutions for sustainable development. Tech Mahindra’s emphasis on ESG is seen in our commitment of achieving Carbon Neutrality by 2030 and being Net zero well-before 2040. We are making optimum use of resources, moving towards low-emission technologies, and taking 5-year targets for ensuring diversity, equality, and innovation, while also updating policies and procedures to maintain a robust and compliant governance.

Tech Mahindra is aligned towards the UN SDGs (Sustainable Development Goals) and its sustainability focus areas are as below:

• Going Carbon Neutral: Increasing use of renewable energy through onsite installations and open access; improving energy efficiency through installation of LEDs, sensors; boosting green investments by implementing Carbon Price; optimizing business travel by enabling virtual meetings; encouraging use of public transport and carpooling to reduce commute emissions; planting trees to offset carbon footprints; moving towards a low carbon economy to ensure environmental protection.

Platform for Energy, Integrated Electric Vehicle Charging systems (IEVCS), Smart data hubs and Smart Cities for our Customers to reduce their emissions.

• Individual Social Responsibility: encouraging associates to make sustainability a part of their day-to-day lives.

• Transparency: Reporting our organizational policies & practices, along with financial, environmental and social data in the Integrated Annual Report.

The recognitions received by Tech Mahindra are a validation of the performance towards the company’s commitments, the details of the awards & recognitions are included in Corporate Overview, kindly refer page no. 25 of this Annual Report.

The Integrated Annual Report is based on various global standards and frameworks such as TCFD (Taskforce on Climate Related Financial Disclosures), CDSB (Climate Disclosure Standards Board), SASB (Sustainability Accounting Standard Board) and GRI standards and assured by third party according to ISAE (International Standard on Assurance Engagement) 3000 standards.

Tech Mahindra discloses climate-related risks and opportunities in line with the recommendations of TCFD which focusses on the financial impact of climate-related changes on our operations.

The TechM Board owns all risks and opportunities. The MD & CEO of the Company chairs the CSR Committee of the Board and has the ultimate responsibility for Sustainability. He is ably supported by the Senior Management members of the Sustainability Council and the Chief Sustainability Officer who manage all aspects of climate change.

The pandemic has taught the Company some concrete lessons and new ways of management in order to thrive in the new post-pandemic world. Tech Mahindra has made good progress on its commitments to provide for a better and more sustainable future by embedding sustainability into its business strategy and ensuring economic recovery and business profitability. The Company strategy includes futureproofing our growth against impending

changes in policies and regulations and increasing our compliance readiness. Your Company are agile and adaptive to dynamic changes in internal and external intricacies with strategies in place to manage all business and ESG risks in an effective way. With a robust business continuity management framework and incident response team, the Company have ensured that we are resilient to any ESG risks.

The targets and the metrics used for managing climate-related & other risks and the progress against these targets are disclosed in the externally assured Integrated reports available on the website of the Company and can be accessed at https://www. techmahindra.com/en-in/sustainability/.

AWARDS AND RECOGNITION

Your Company continued its quest for excellence in its chosen area of business to emerge as a true global brand. Several awards and rankings continue to endorse your Company as a thought leader in the industry. Few of the Awards / recognitions received by the Company during the year 2021-22 include:

• Tech Mahindra recognized among the Economic Times Iconic Brands 2021.

• Tech Mahindra was declared winner of

NASSCOM Engineering & Innovation Excellence Awards 2021 for Service Delivery Excellence & Next-Gen Products for our projects on Vehicle Top Hats & Distributed Ledger DnD.

• Tech Mahindra listed among 2021 Best

Workplaces in Asia by Great Place to Work®.

• Tech Mahindra received HRH, The Prince

of Wales’ Terra Carta Seal in Recognition of the Company’s Commitment to Creating a Sustainable Future.

• Tech Mahindra won 3 Golds at the prestigious 2021 Stevie Awards for Great Employers.

• Tech Mahindra Recognized as the Fastest

Growing Organization in ‘Brand Strength’ by Brand Finance.

• Tech Mahindra emerges as the only Indian

company in the Forbes’ Blockchain 50.

• Mr. C. P. Gurnani has been recognized by The Economic Times among ‘Most Inspiring Business Leaders of Asia’ at The Economic Times 6th Edition Asia’s Promising Business Leaders.

• Tech Mahindra Included in Bloomberg Gender-Equality Index for Third Consecutive Year.

• Tech Mahindra was recognized for its pathbreaking sustainable efforts and was ranked 2nd amongst the Top 35 companies in Business world India’s Most Sustainable Companies 2022.

These awards are a reflection of the Company’s continued efforts in the fields of business, sustainability, human resource management and its sustained progress towards creating a better society for all.

ACKNOWLEDGEMENTS

Your Directors place on record their appreciation for the contributions made by employees towards the success of your Company more particularly ensuring business as usual in spite of the impact of COVID-19. Your Directors gratefully acknowledge the cooperation and support received from the shareholders, customers, vendors, bankers, regulatory and Governmental authorities in India and abroad.

For and on behalf of the Board

Anand G. Mahindra Place: Mumbai Chairman

Date: May 13, 2022 (DIN: 00004695)


Mar 31, 2022

Your Directors present the Thirty Fifth Annual Report along with the audited accounts of your Company for the year ended March 31, 2022.

FINANCIAL RESULTS (STANDALONE)

('' in Million)

For the year ended March 31

2022

2021

Income

362,489

305,627

Profit Before Interest, Depreciation and Tax

70,081

62,521

Interest

(636)

(632)

Depreciation

(6,599)

(6,623)

Profit Before Tax

62,846

55,266

Provision for Taxation

(13,715)

(12,875)

Profit After Tax

49,131

42,391

Other Comprehensive Income

1,081

2,453

Balance brought forward from previous year

200,874

184,021

Profit available for appropriation

249,753

226,432

Equity Dividends (Including tax on dividend)

(43,624)1

(19,335)2

Transfer to retained earnings on account of options lapsed

74

96

Transferred to Special Economic Zone re-investment reserve (net of utilisation)

-

(6,319)

Transferred from Special Economic Zone re-investment reserve on utilization

6,348

-

Balance carried forward

212,551

200,874

1 Interim Dividend (Special Dividend) for the Financial Year ended March 31,2022 and Final Dividend for the Financial Year ended March 31,2021

2 Interim Dividend (Special Dividend) for the Financial Year ended March 31,2021 and Final Dividend for the Financial Year ended March 31,2020

SHARE CAPITAL

During the year under review, your Company allotted 3,573,412 equity shares on the exercise of stock options under various Employee Stock Option Schemes. Consequently, the issued, subscribed and paid-up equity share capital has increased from '' 4,841 million divided into 968,260,067 equity shares of '' 5/- each to '' 4,859 million divided into 971,833,479 equity shares of '' 5/- each.

BUSINESS PERFORMANCE / FINANCIAL OVERVIEW

Tech Mahindra lives by the philosophy of creating a connected world built on connected experiences. It thrives on change powered by the intelligent symphony of technology and humans, designing both meaningful and sustainable experiences. Your Company is strongly positioned to succeed in this new normal and deliver what’s NXT.NOW for its customers. The Company has a rare combination of connectivity and experience as its endowment which, along with


DIVIDEND

The Board of Directors on October 25, 2021 approved a special dividend of '' 15/- per share (i.e. 300%) on par value of '' 5/- each which was paid by the Company to the shareholders whose names appeared in the Register of Members as on November 5, 2021, being the record date for the payment of dividend. Your Directors are pleased to recommend a final dividend of '' 30/- per share (including a special dividend of '' 15/- per share) on par value of '' 5/- (i.e. 600%), payable to those Shareholders whose names appear in the Register of Members as on the Book Closure Date. Thus, the total dividend for the F Y 202122 will be '' 45/- per share (i.e. 900%) similar to the dividend of '' 45/- per share (i.e. 900%) paid for the Financial Year 2020-21.

Your Company has formulated a Dividend Policy which is disclosed on the website of the Company and can be accessed at https://insights.techmahindra.com/ investors/tml-dividend-distribution-policy.pdf

its big bets on Cloud and engineering, form the Company’s NXT.NOW strategy.

The main components of the NXT.NOW Strategy are:

Connectivity - Modernizing networks has been our legacy for more than 25 years, serving the top global wireless communication service providers.

Experience - The Company provides award-winning and industry-leading capabilities in human-centric design.

Cloud - The Company continues to invest in rapidly scaling its partnerships and is uniquely positioned to deliver on the promise of Cloud, AI, and cyber security for its customers.

Engineering - The Company is home to leading products and software capabilities, enabled by a network of global excellence centers and top engineering talent.

During the Financial Year ended on March 31, 2022, the Company’s revenues grew to '' 446,460 million on consolidated basis as against '' 378,551 million in the previous year - indicating a robust growth of 18%. The growth was broad based across geographies as both Americas and Europe contributed in line with overall revenue growth. The Company also saw healthy growth across business segments in CME and Enterprise verticals.

The EBITDA on consolidated basis for the Financial Year 2022 was '' 80,200 million, a growth of 17% over the previous year EBITDA of '' 68,470 million. The resultant EBITDA margins were in a similar range - 18% in FY 2022 as against 18.1% in FY 2021. The post-tax profit of the Company increased by 25.7% to '' 55,661 million in FY 2022 as against '' 44,280 million in FY 2021.

The Company saw robust demand for digital transformation services with focus on customer experience and cloud. The Company has seen new deal wins of over USD 3,000 million in the previous year indicating a healthy growth momentum across all business verticals. Your Company’s investments in Enterprise SaaS and Hi-tech capabilities will help it cater to increasing modernization demands from businesses in Financial Year 2023 and beyond.

ACQUISITIONS

Your company made the following acquisitions during the financial year 2021-22.

DIGITALONUS

The Company on May 7, 2021, acquired 100% of the share capital of DigitalOnUs Inc. through its wholly owned subsidiary company Tech Mahindra (Americas) Inc. at a consideration of USD 120 million including earnouts and retention bonus. The company is headquartered in California, USA and is focused on Cloud Native Development and Hybrid Cloud Automation Services. This acquisition helped your Company in enhancing capability in Cloud Native Engineering and positioned the Company to develop cutting-edge digital solutions for its customers.

EVENTUS SOLUTIONS GROUP

The Company on June 18, 2021, acquired 100% of the share capital of Eventus Solutions Group, LLC (Eventus) through its wholly owned subsidiary company Tech Mahindra (Americas) Inc. at a consideration of USD 44 million including earnouts. Eventus is headquartered in Denver, Colorado, USA and has strong consulting capability in customer experience (CX) and customer management and enabled your Company to build an industry leading consulting practice in BPS business.

BERIS CONSULTING GMBH

The Company on October 1, 2021, acquired 100% of the share capital of Beris Consulting GmbH (Beris) through its subsidiary Company Tech Mahindra GmbH at a consideration of EUR 7 million including earnouts. Beris has 125 employees and helps your Company to unlock the transformational growth in the IT and application space for the automotive industry as a result of industry trends such as EV, Sharing & Mobility. It will also help your Company to expand its presence, hone local expertise and client relationships in the German market.

INFOSTAR LLC

The Company acquired 100% of the share capital of Infostar LLC (Lodestone) through its wholly owned subsidiary company Tech Mahindra (Americas) Inc. on October 25, 2021 at a consideration of USD 105 million including earnouts. Lodestone is headquartered in California, USA and helps your company to bolster end to end digital product engineering capabilities across design, build and test by employing Lodestone’s expertise in data strategy and providing end to end product quality assurance across hardware, software and data layers.

WE MAKE WEBSITES

The Company acquired 100% of the share capital of We Make Websites, UK through its step-down

subsidiary company Born London Limited, UK on October 25, 2021 at a consideration of GBP 9.4 million. The company is headquartered in UK and its offerings include Custom Shopify App Development, focused Ecommerce Agency, Design & UX, re-platforming, SEO & Data Migration, Headless Commerce, CRO, Performance Enhancement, Payments & Checkout, Compliance, Accessibility and O2O strategy.

BRAINSCALE

The Company on November 17, 2021, acquired 100% of the equity shares in Brainscale Inc. (Brainscale) through its wholly owned subsidiary company Tech Mahindra (Americas) Inc. at a consideration of USD 28.8 million including earnouts. Brainscale has expertise in Cloud consulting, Cloud enablement, Application Development and Data Analytics, which will bolster your company’s consulting capabilities in the Cloud transformation space and will enable your Company to drive growth of Cloud related IT services.

ACTIVUS

The Company on December 3, 2021, acquired 100% of the equity shares in Activus Connect LLC and Activus Connect PR LLC (together called as Activus) through its wholly owned subsidiary company Tech Mahindra (Americas) Inc. at a consideration of USD 62 million including earnouts. Activus is headquartered in Florida USA and has 1750 employees and is in the business of remote customer experience and customer care solution. This acquisition will help improve your company’s capability in the work from home Customer Experience Management by employing unique delivery model and disruptive platform called Smart Virtual.

ALLYIS

The Company on December 31, 2021, acquired 100% of the equity shares in Green Investments LLC (Allyis) through its wholly owned subsidiary company Tech Mahindra (Americas) Inc. at a consideration of USD 122.4 million including retention bonus and earnouts. Allyis is headquartered in Seattle, USA and has presence in US, Romania, Costa-Rica and India. The Indian subsidiary was acquired by Tech Mahindra Limited, at a consideration of USD 2.6 million. Allyis offers Technology consulting and managed services that help Organizations to reduce costs, improve performance which would help your Company’s capabilities in digital experience solutions and engineering, cloud and automation, BI and Analytics and Technical Support services.

CTC

The Company on January 17, 2022, acquired 100% of the equity shares in Com Tech Co IT Limited (CTC) through its wholly owned subsidiary company Tech Mahindra London Limited at a consideration of EUR 310 million including earnouts. CTC has 720 employees and is a specialized digital engineering and outsourced product development organization with development centers in Latvia and Belarus. It offers high-end-digital engineering services to some of the largest insurance and reinsurance organisations globally. Your Company also acquired 25% equity shares each in SWFT Technologies and Surance Ltd which are early stage InsurTech SaaS ventures with a proven technology.

GEOMATIC.AI

The Company acquired 80% of the share capital of Geomatic.AI Pty Ltd, Australia through its wholly owned subsidiary company Tech Mahindra (Singapore) Pte. Ltd on February 15, 2022 at a consideration of A$6 million. Geomatic.AI is headquartered in Australia and its offerings include digital platforms led nonlinear growth in partnership with AusNet Services an Australian Energy & Utilities distributor and will build digital twins for linear assets leveraging Cloud, Drone and Mobility technologies in the Geospatial domain.

DETAILS OF SUBSIDIARIES / JOINT VENTURES / ASSOCIATE COMPANIES

The performance and financial position of the subsidiaries, associate and joint venture companies included in the consolidated financial statement is provided in accordance with the provisions of Section 129 read with Rule 5 of the Companies (Accounts) Rules, 2014 containing the salient features of the financial statement of the Company’s subsidiaries/joint ventures or associate companies in Form AOC - 1 in "Annexure I” to this report.

Pursuant to Rule 8(5)(iv) of the Companies (Accounts) Rules, 2014, the names of the companies which have been incorporated or ceased to be the subsidiaries, joint ventures or associate companies during the year are provided in "Annexure II” to this report. The Company is actively pursuing the initiative on the consolidation of its subsidiaries/branches to optimize the operational costs. During the year under review, your Company has closed/merged fourteen subsidiaries.

In terms of the provisions of Regulation 24 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations 2015, Tech Mahindra (Americas) Inc. is a wholly owned unlisted material subsidiary of the Company.

The policy for determining material subsidiaries formulated by the Board of Directors is disclosed on the website of the Company and can be accessed at https://insights.techmahindra.com/investors/Policy-For-Determining-Material-Subsidiaries.pdf

UPDATE ON MERGER

The Board of Directors at its meeting held on January 31, 2021 approved the Scheme of Merger of Tech Mahindra Business Services Ltd and Born Commerce Private Ltd with the Company. Accordingly, the companies filed the petitions before the Hon’ble National Company Law Tribunal (NCLT), Mumbai and Chennai Benches respectively. The petitions are pending for final hearing as on the date of this Report.

HUMAN RESOURCES

The employees of the Company are the most critical asset to your Company. The Company has taken several steps to protect, retain, and improve the competencies of these assets including:

Hiring: War for Talent

Your Company responded to the ‘Great Resignation’ by adopting many innovative practices such as remote hiring, hybrid working, productivity to the engagement of remote workforce. With no location constraints, your Company could hire diverse talent including stay-at-home women, retired professionals, Persons with Disabilities (PwDs), gig workers, and more. Through the NXT.Town program, your Company started small centres in Tier-II and Tier-III cities across India to proactively look beyond set boundaries and focus on skill-based hiring in emerging technologies. Your Company is also committed to diversifying talent hiring at global delivery centres to improve local customer connect. Your Company has restructured its referral and campus recruitment programs to actively encourage hiring at the ‘bottom of the pyramid’. The Digital RMG platform has helped your Company proactively hire based on forecasted demand through a custom-built applicant tracking system that allows collaborative hiring and improves the candidate experience.

Learning: Build v/s Buy Talent

At your Company, learning plays a strategic role in the achievement of business goals by facilitating upskilling and creating a future-ready workforce, all the while fulfilling its associates’ career aspirations. In order to enable end-to-end digital transformation for global customers, your Company is building skills and keeping its talent pool brimming with new-age technologies. By offering skill-based and accelerated career movement allowance through the Career Acceleration Policy, your Company is encouraging niche skilling, thus creating a win-win situation. Your Company has launched a Cloud Finishing School for creating project-ready talent in Cloud technologies to fulfil business needs. After the success of the EMBARK capability building program for Program Managers, your Company has started an Architect COE for solution and technical architects who work on digital transformation. In an effort to build a roster of young and diverse leadership, the Company has launched focused young leader and women leader programs, with an emphasis on deploying them into new roles once their learning journey is complete. The Company has also partnered with Harvard to offer bite-sized learning content via the Harvard Manager Mentor (HMM) SPARK platform. Your Company continues to leverage its #NAD Learn platform to create full-stack professionals through initiatives like fresher-skilling, project-skilling, future-skilling and bench-skilling (Competence to Deployment) to create future-ready talent, in line with its NXT.NOW philosophy.

Leadership: Extreme Ownership

The natural culture of empowerment at your Company was supercharged during the pandemic as associates took ownership for their deliverables and leaders at all levels were an integral part of the decision-making process. The Leadership team of the Company aims to imbibe the following atomic habits -alternate thinking, bias for action, closure over followup, data over emotions and extreme ownership. This was reinforced through the adoption of a real-time Performance Management Dashboard for the 300 talent-to-value business leaders whose continuous executive coaching and performance management was instrumental in your Company meeting its financial and strategic goals. Apart from coaching, the Leaders at the Company have also had the opportunity to experience new forms of learning with technology-enabled pedagogies like habit builders, qubit

thinking, cinema-based learning, gamification etc. The Company also launched the Leadership Retreat, an eight-day-long learn-as-you-work residential program to replenish the physical, emotional, cognitive, and social energies of mid and senior level leaders.

Performance: Outcome-Driven

Your Company launched the Annual Performance Feedback cycle in December 2021 and has completed its performance appraisal. Aspiring to build a culture where performance is enabled through feedback, managers have been trained to engage in better performance review dialogues with their direct reports and work on an outcome-based evaluation, rather than process or effort measurement. Your Company is creating a high-performance culture through hyper-personalized incentive plans. Your Company has a suite of incentive plans that are designed to create a strong alignment between individual wealth creation and organizational performance. In addition to broad-based incentive plans, your Company has also customized quarterly sprint incentives which create avenues for instant gratification for associates across the front, middle, back offices as well as enabling functions, thereby inculcating a spirit of collaboration. With platforms like Talex, #NAD Learn and a revamped job rotations policy, your Company continued to improve internal mobility.

Wellness: Holistic Wellbeing

The ‘Wellness Before Business’ mantra followed by your Company has ensured the collective well-being and safety of its entire ecosystem of stakeholders, including associates, customers, and partners. The Wealth of Wellness (WoW) program ensures preventive, personalized, and proactive holistic wellness across all 8 dimensions of wellness including physical, mental, emotional, and financial parameters. The Company has launched new policies like the Bereavement Support for Dependents (COVID Support) Policy, Sabbatical Leave Policy, and more in response to the unique challenges posed by the pandemic. Your Company also provided financial security and crucial support through the Associate Welfare Trust for 190 associates, disbursing '' 2.8 crores. To highlight the importance of physical well-being, your Company launched the Wellness 101 Challenge as well as the Run Anywhere virtual marathon to engage its associates who predominantly worked from home and encouraged them to reclaim their fitness. Mental well-being was prioritized through initiatives like the Mind Plan, People Care Manager Program and the Emotional Wellness Self-Assessment.

Pandemic: #ResolveToRise

#ResolveToRise was an organization-wide campaign by the Company, rallying associates to embrace the Rise credo and encouraging them to stay strong by sharing inspiring stories and initiatives from the ground, including COVID warriors assisting those in need, Company-led innovations using #TechForGood to help the most vulnerable, community-wide volunteering efforts, and more. During the pandemic, the Company also setup a COVID-19 Support Fund, providing much-needed relief to affected families, setting up oxygen plants and donating ambulances to charitable hospitals. Your Company also setup COVID care centres at five major locations to help both associates and the larger community. Through the SOS Seva, your Company helped patients access critical care including hospital beds, oxygen cylinders, oxygen concentrators, medicines, and plasma. Through a series of vaccination drives, your Company has encouraged protection and prevention, vaccinating associates, their family members, and other third-party staff.

Communication: Building Purpose

Through effective internal communications, your Company ensures that the connected purpose of the organisation is communicated to all associates, thus reiterating the core philosophy of the brand: creating a connected world with connected experiences. With hybrid working being the norm, your Company has made virtual connectedness a way of life through various digital initiatives that were purpose-led, peoplecentric, and performance-driven. Multiple mediums were used to reach out to associates including social media, e-chats, emailers, campaigns, screensavers and more. With a 360-degree-communication approach, your Company has built a culture that is based on celebration, positive change, and the credo of Rise which has resulted in a unifying pride for the Company - their #LoveToBeTechM.

Diversity: Being Yourself

Your Company considers ‘diversity of people’, ensuring ‘equitable opportunities’ and ‘inclusion at the workplace’ as an instrument of growth. This has reflected in the definition of the new vision statement of your Company. The earlier Vision 2021 was about fostering innovation and that comes from ‘diversity of thought’. The new Vision 2024 is about creating a purpose-led company. Your Company is committed to pursuing ‘Purpose beyond Profits’ by embedding Environmental, Social and Governance

Engagement: TechM CARES Survey

Your Company has taken active steps to build remote engagement by creating virtual ‘water-cooler’ moments and updating policies in line with the ‘new normal’. To ensure that associates were continuously engaged through the right channels and received the right information at the right time, your Company followed the 4C model - Connect, Collaborate, Career, and Celebrate. Associates have expressed their confidence and delight through the TechM CARES survey where your Company has secured an overall rating of 4.58/5 - the highest score in its history. This engagement score represents a 54 basis points increase over the last survey score of 4.04/5 and reinforces your Company’s commitment to create human-centered experiences for its associates.

QUALITY

The Company continues its focus on quality and strives to exceed customer expectations at all times. During the year, it continued to strengthen the implementation of Quality systems and upgraded various processes to comply with CMMI V 2.0 for both Dev and Services. The Organization is recently assessed at Level 5 maturity. Similarly it underwent various upgrade and re-certification audits for multiple standards during the year in order to meet client demands and enhance value delivery. The Company has Successfully re-certified, ISO 9001:2015 (Quality Management System), ISO 20000-1:2018 (Information Technology Service Management System), ISO 27001:2013 (Information Security Management System), ISO 27701:2019 (Privacy Information Management System), TL9000 R 6.2/ R5.7 (Quality Management Systems for Tele Communications industry), ISO 13485:2016 (Quality Management Systems for medical devices - scope of certification limited to medical devices business within Tech Mahindra), AS9100 Rev D (Standard for Aerospace domain - scope of certification limited to the aerospace business within Tech Mahindra), ISO 17025:2017 - Laboratory Quality Management Systems for device testing labs.

In addition to these, your Company also maintains its commitment to health, safety and environment by continually improving its processes in accordance with ISO 14001:2015 (Environmental Management System) and ISO 45001: 2018 (Occupational Health and Safety Assessment Series) standards. Your Company is also certified on ISO 22301:2012 (Societal Security and

(ESG) principles into its core strategy, thus creating a long-term positive impact on the planet and society while providing greater value for all its stakeholders. Improvements in Diversity, Equity and Inclusion practices is critical to improve the Social aspect of ESG, and hence your Company has defined a roadmap for improvements across the dimensions of Gender, Generation, People with Disabilities, the LGBTQ community as well as cultures and nationalities. This also links back to the stated objective of your Company to be human-centered by encouraging associates to bring their most authentic selves to work.

Recognition: People at the Core

While timely recognition is key to a happy workforce, your Company also prioritizes creating a culture of appreciation. Your Company’s robust digital platform ensures both recognition and appreciation with monetary and non-monetary rewards badges linked to redemption points. Your Company also encourages its associates to donate their reward points towards social causes and has an industryleading rewards penetration of approximately 40%. To celebrate achievements in the virtual world, your Company introduced the quarterly Spotlight awards and other timely sales- focused awards to reward growth, collaboration, and high-impact initiatives. Your Company also included associates’ family members to virtually felicitate both Long Service Awardees and ACERs (consistent performers for two years) for their outstanding contributions and commitment.

HR Digitization: Automation at every Step

Your Company has continued to invest in its flagship product, ‘Dove,’ for new joiners, enabling new capabilities for document submissions and personal information updates. Your Company has continued to enhance self-service capabilities for existing associates in diverse areas such as letter generation, work permits, automated approvals, and proactive notifications for key events. Your Company has adopted Office 365 as well as the Enate and UNO platforms to automate routine business transactions through BOTs. Your Company has also taken steps to improve the post-joining and pre-exit processes to improve communication as a step towards empowering associates with the right information. Your Company has also leveraged Artificial Intelligence/ Machine learning to build internal applications to provide associates with customer-like experiences.

Business Continuity Management System) and has a comprehensive Business Continuity and Disaster Recovery framework, to prevent potential business disruptions in the event of any disaster. The Company has processes that helped resume services to customer’s acceptable service levels. Automated Service Desk with SLAs for enabling business and Vulnerability Assessment and Penetration Testing Lab for secured corporate network operations are highlights that showcase the information security posture of the Organization.

During the second year of the pandemic, the entire quality management system was put to test with majority of the associates working from home. Complying with the Company’s security requirements, they were able to deliver services as per contractual commitments, leading to great customer satisfaction.

Tech Mahindra (IT Division) has been assessed for the implementation of high maturity business excellence practices at Mahindra Group (Services Sector). It has been assessed at TMW Maturity Stage 7 (on scale of 1-10 stages) of Mahindra Business Excellence Framework - The Mahindra Way. These certifications are testimony of the robustness of business processes and at large the quality culture imbibed in the organization.

Your Company has continued to strengthen the process for transforming Quality Assurance processes & delivery methods to adopt and strengthen Delivery excellence, Risk governance, and further enhance automation to enable quality delivery to the customer. Quality index which is a measure of quality of products and services delivery is institutionalized.

All these actions are being taken to ensure that the Company deliver as stated in its Quality Policy.

DIRECTORS

During the year under review, all Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Independent Directors have also given declaration of compliance with Rules 6(1) and 6(2) of the Companies (Appointment and Qualification of Directors) Rules, 2014, with respect to

their name appearing in the data bank of Independent Directors maintained by the Indian Institute of Corporate Affairs.

Pursuant to the provisions of Section 152(6)(c) of the Companies Act, 2013, Mr. C. P. Gurnani, Managing Director & CEO (DIN: 00018234) is liable to retire by rotation and offers himself for reappointment.

Further the term of Mr. C. P. Gurnani as Managing Director & CEO expires on August 9, 2022. The Board of Directors based on the recommendation of Nomination and Remuneration Committee considering the performance of the Managing Director & CEO over the last 10 years & his contribution to the growth of the Company approved and recommends the re-appointment of Mr. C. P. Gurnani as Managing Director & CEO for another term from August 10, 2022 upto December 19, 2023, which is his date of retirement from the Company, subject to the approval of shareholders at the ensuing Annual General Meeting.

Your Directors co-opted Ms. Penelope Fowler (DIN: 09591815) as an Additional Director with effect from May 13, 2022. The term of Ms. Fowler will end at the ensuing Annual General Meeting. As Ms. Penelope Fowler meets the criteria of an Independent Director, the Board recommends her appointment as an Independent Director for a period of 5 years for the approval of shareholders at the ensuing Annual General Meeting.

Mr. M. Damodaran (DIN: 00125299) has retired as an Independent Director of the Company with effect from March 31, 2022. Your Board places on record its sincere appreciation for the valuable contribution and timely guidance from Mr. M. Damodaran to the Company during his tenure.

In terms of Regulation 24(1) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations 2015, Mr. T. N. Manoharan, Lead Independent Director of the Company has been appointed as Director on the Board of Tech Mahindra (Americas) Inc., a wholly owned unlisted material subsidiary of the Company with effect from May 21, 2019.

In the opinion of the Board of Directors the Independent Directors have relevant proficiency, expertise and experience.

i. Policy on the appointment and removal of Directors, Key Managerial Personnel and Senior Management.

ii. Policy on remuneration to the Directors, Key Managerial Personnel and Senior Management and other Employees.

The extract of these two policies is provided in "Annexure III''

The policies are available on the website of the Company and can be accessed at https://insights. techmahindra.com/investors/Governance-Policies-including-remuneration-to-Directors-KMPS.pdf

SUCCESSION PLAN

In accordance with the principles of transparency and consistency, your Company has adopted governance policies for appointments, remuneration and evaluation of its Board of Directors, Key Managerial Personnel & Senior Management. In line with these Governance policies, the Company has established a formal Succession Planning Program for key managerial persons across the organization. The Board evaluates all such plans at a regular interval and institutes a formal program for filling any such critical position. The Board evaluates both internal and external candidates for such positions alongwith the recommendations of the Company. The Company also has a leadership development program where it identifies high potential managers, and trains them to take up the positions of higher responsibility. The Company has identified the second line of leadership, which provides stability to the business in any contingencies.

TRAINING

The Company has laid down a policy on the training of Independent Directors as part of its governance policies. The Senior Leadership of the Company periodically updates the Directors on regulatory changes, business strategy and the Company has laid down a policy on the training of Independent Directors as part of its governance policies. The Senior Leadership of the Company periodically updates the Directors on regulatory changes, business strategy and operations.

KEY MANAGERIAL PERSONNEL (KMP) Pursuant to provisions of Section 203 of the Companies Act, 2013, Mr. C. P Gurnani, Managing Director & Chief Executive Officer, Mr. Manoj Bhat, Chief Financial Officer (up to April 1, 2021), Mr. Milind Kulkarni,


FAMILIARISATION PROGRAMME

These programmes aim to provide insights into the Company to enable the Independent Directors to understand its business in depth and contribute significantly to the Company. The details of program for familiarisation of the Independent Directors with the Company are available on its website and can be accessed at https://insights.techmahindra.com/ investorsltml-familarisation-progarmmes-for-IDs.pdf

The Board members are also regularly updated on changes in statutory provisions like changes in Corporate Laws, SEBI Regulations, Taxation Laws and People related laws as applicable at the quarterly Board meetings. The Board members are also updated on the Risk universe applicable to the Company’s business. The MD & CEO of the Company had quarterly sessions with Board members sharing updates about the Company’s business strategy, operations and the key trends in the IT industry that are relevant to the Company. These updates help the Board members in keeping abreast of key changes and their impact on the Company.

BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and Regulation 19 read with Schedule II, Part D of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has devised a policy on evaluating the performance of the Board of Directors, the Chairman, Committees, and Individual Directors. The evaluation process was carried out through a web-based portal. The summary of the evaluation reports was presented to the respective Committees and the Board. The Directors had given a positive feedback on the overall functioning of the Committees and the Board. The suggestions made by the Directors in the evaluation process have been suitably incorporated in the processes.

NUMBER OF MEETINGS OF THE BOARD

The Board met four times during the Financial Year 2021-22. The meeting details are provided in Corporate Governance report that forms part of this Annual Report. The maximum interval between any two meetings did not exceed 120 days as prescribed in the Companies Act, 2013 and SEBI Listing Regulations.

POLICY ON DIRECTORS’ APPOINTMENT AND REMUNERATION

The Governance policies laid down by the Board of Directors of your Company include:

are adequate for ensuring the orderly and efficient conduct of the business, including adherence to the Company’s policies, the safe guarding of assets, the prevention and detection of frauds and errors, the accuracy and completeness of accounting records and timely preparation of reliable financial information.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS / PROCEEDINGS

There are no significant and material orders passed by the regulators or courts or tribunal impacting the going concern status and the Company’s operations in the future.

Further no application against the Company has been filed or is pending under the Insolvency and Bankruptcy Code, 2016, nor the Company has done any one time settlement with any Bank or Financial institutions.

STATUTORY AUDITORS

The members, in the 30th Annual General Meeting (AGM) held on August 1, 2017, appointed

M/s. B S R & Co. LLP, Chartered Accountants, [ICAI Firm’s Registration No. 101248W/W- 100022] as the Statutory Auditors of the Company, to hold office for a term of five years from the conclusion of the 30th AGM of the Company held in the Financial Year 2017-18 until the conclusion of the AGM of the Company for the Financial Year 2021- 22 on such remuneration as may be determined by the Board of Directors.

Pursuant to Section 139 of the Companies Act, 2013 the Statutory Auditors M/s. B S R & Co. LLP, Chartered Accountants have confirmed that they are eligible to continue as auditors.

In accordance with provision of Section 139 of the Companies Act, 2013 read with Rules framed thereunder, the Board of Directors of the Company on the recommendation of the Audit Committee, proposes appointment of M/s. B SR & Co. LLP, Chartered Accountants (ICAI Firm’s Registration No. 101248W/W - 100022) as Statutory Auditors of the Company to hold office from the conclusion of ensuing 35th AGM for a term of five consecutive years till the conclusion of 40th AGM. The appointment of M/s. B S R & Co. LLP as the statutory auditors of the Company is placed before the members for approval at the ensuing AGM.

As required under provision of Section 139(1) of the Companies Act, 2013 the Company has received a written consent from M/s. B S R & Co. LLP for their

Chief Financial Officer (w.e.f. April 2, 2021) and Mr. Anil Khatri, Company Secretary & Compliance Officer were the Key Managerial Personnel of the Company during the year under review. Mr. Milind Kulkarni will retire as Chief Financial Officer of the Company w.e.f. May 31, 2022 and Mr. Rohit Anand was appointed as Chief Financial Officer of the Company w.e.f. June 1, 2022.

DIRECTORS’ RESPONSIBILITY STATEMENT

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

i. in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

ii. they have, in the selection of the accounting policies, consulted the Statutory Auditors and these have been applied consistently and, reasonable and prudent judgments and estimates have been made so as to give a true and fair view of the state of affairs of the Company as at March 31, 2022 and of the profit of the Company for the year ended on that date;

iii. proper and sufficient care had been taken 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 other irregularities;

iv. the annual accounts have been prepared on a going concern basis;

v. they had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively;

vi. the proper systems to ensure compliance with the provisions of all applicable laws are in place and are adequate and operating effectively.

DETAILS WITH RESPECT TO ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS

The Company has internal financial controls which are adequate and were operating effectively. The controls appointment and a certificate to the effect that their appointment, if made, would be in accordance with the Companies Act, 2013 and the Rules framed thereunder and that they satisfy the criteria provided in Section 141 of the Companies Act, 2013 read with Rule 4(1) of the Companies (Audit and Auditors) Rules, 2014 and that they are not disqualified for appointment as statutory auditors of the Company.

There are no qualifications, reservations, adverse remarks or disclaimer made in the audit report for the Financial Year 2021-22.

SECRETARIAL AUDIT REPORT

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 had appointed Mr. Makarand Lele & Co., Practicing Company Secretary, Pune to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is available at ‘Annexure IV” to this report. There are no qualifications, reservations, adverse remarks or disclaimer made in the Secretarial Audit Report.

COMPLIANCE WITH SECRETARIAL STANDARDS

The Company has complied with the applicable Secretarial Standards.

ANNUAL RETURN

Pursuant to the provisions of Section 92(3) read with Section 134(3) (a) of the Companies Act, 2013, the Annual Return in Form MGT-7 is available on the website of the Company and can be accessed at https://insights.techmahindra.com/investors/mgt7-annual-return-2021-22.pdf

MANAGERIAL REMUNERATION

Disclosures of the ratio of the remuneration of each director to the median employee’s remuneration and other details as required pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended from time to time, are provided as "Annexure V”.

None of the directors or Managing Director & CEO of the Company, received any remuneration or commission from Subsidiary Companies of your Company.

The details of remuneration paid to the Directors including the Managing Director & CEO of the Company is provided in Corporate Governance Report.

PARTICULARS OF EMPLOYEES

The information required under Section 197(12) of the Companies Act, 2013 ("the Act”) read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms part of this Report. However, pursuant to first proviso to Section 136(1) of the Act, this Report is being sent to the Shareholders excluding the aforesaid information. Any shareholder interested in obtaining said information, may write to the Company Secretary at the Registered Office / Corporate Office of the Company and the said information is open for inspection at the Registered Office of the Company.

POLICY ON PREVENTION OF SEXUAL HARASSMENT

Your Company laid down the Prevention of Sexual Harassment (POSH) policy which is available on its website. The Company has zero tolerance on Sexual Harassment at workplace. During the year under review there were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

The status of complaints received under POSH and redressed by the POSH Committee of the Company, during the Financial Year under review, are given below:

a) Number of complaints received - 45

b) Number of complaints redressed - 43

c) Number of complaints pending - 2

There are focused campaigns on the POSH policy within the Company and awareness drives that take place with the help of its BPS teams. Furthermore, the employees are required to undertake a mandatory annual certification on POSH to sensitize themselves and strengthen their awareness.

EMPLOYEE STOCK OPTION SCHEMES

During the year under review, there were no material changes in the Employee Stock Option Schemes (ESOPs) of the Company and the Schemes are in compliance with the SEBI Regulations on ESOPs.

As per Regulation 14 of Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021, the details of the ESOPs are uploaded on the website of the Company and can be accessed at https://insights.techmahindra. com/investors/Details-of-ESOPs-FY-2021-22.pdf

CORPORATE GOVERNANCE

A report on Corporate Governance covering among others composition, details of meetings of the Board and Committees along with a certificate for compliance with the conditions of Corporate Governance in accordance with the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, issued by the Statutory Auditors of the Company, forms part of this Annual Report.

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.

COST RECORDS

Maintenance of cost records and requirement of cost audit as prescribed under the provisions of Section 148(1) of the Companies Act, 2013 are not applicable for the business activities of the Company.

RISK MANAGEMENT

The Risk Management Committee of the Board of Directors guides the operating management to identify risks, analyze their probability and impact and prepare mitigation plans. It periodically reviews the Risk Management Framework & Enterprise Risk Register which is presented by the Chief Risk Officer. The Company identifies all potential risks viz. economical, business, currency, operational, climate, governance, financial, cyber, business continuity etc. and prepares a mitigation plan for each of the risks. The elements of risk as identified by the Company with the impact and mitigation strategy are set out in the Management Discussion and Analysis Report (MDA).

ESTABLISHMENT OF VIGIL MECHANISM

The Company has laid down Whistle Blower Policy covering Vigil Mechanism with protective Clauses for the Whistle Blowers. The Whistle Blower Policy is made available on the website of the Company.

DEPOSITS / LOANS & ADVANCES, GUARANTEES OR INVESTMENTS

The Company has not accepted any deposits from the public during the year under review. The particulars of loans/advances, guarantees and investments under Section 186 of the Companies Act, 2013 are given in the notes forming part of the Financial Statements.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All transactions entered into with Related Parties as defined under Section 2(76) of the Companies Act, 2013 and Regulation 23 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, ("The Listing Regulations”), during the Financial Year under review were in the ordinary course of business and at an arm’s length pricing basis and do not attract the provisions of Section 188 of the Companies Act, 2013. There were no transactions with related parties in the Financial Year which were in conflict with the interest of the Company and requiring compliance of the provisions of Regulation 23 of the Listing Regulations.

Suitable disclosure as required by the Indian Accounting Standards (Ind AS 24) has been made in the notes forming part of the Financial Statements.

The Company has formulated a policy on the materiality of Related Party Transactions and dealing with Related Party Transactions which has been uploaded on the website of the Company and can be accessed at https://insights.techmahindra.com/investors/Related-Party-Transactions-Policy.pdf

The particulars of related party transactions in prescribed Form AOC - 2 are attached

as ‘Annexure VI”.

Pursuant to Regulation 23(9) of the Listing Regulations, your Company has filed half yearly report on Related Party Transactions with the stock exchanges.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars as prescribed under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 are provided in “Annexure VII” which forms part of this report.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

The CSR vision of the Company is "Empowerment through Education.”

In compliance with the guidelines prescribed under Section 135 of the Companies Act, 2013, your Company has constituted a Corporate Social Responsibility (CSR) Committee of the Board. The CSR policy, covering the Objectives, Focus Areas, Governance Structure Monitoring and Reporting Framework among others is approved by the Board of Directors. In accordance with the amendments made in Section 135 in January 2021, the CSR Policy has been duly revised and is available on the website of the Company and can be accessed at https://files. techmahindra.com/static/img/pdf/csr-policy-techm-v3-march2021.pdf

The Company has spent more than 2% of the average net profits of the Company during the three immediately preceding Financial Years on CSR.

The Company’s social initiatives are mainly carried out by Tech Mahindra Foundation and Mahindra Educational Institutions, Section 8 (erstwhile Section 25) Companies promoted by the Company.

TECH MAHINDRA FOUNDATION (TMF) EDUCATION

The key initiatives taken by TMF in the arena of school education include:

ALL ROUND IMPROVEMENT IN SCHOOL EDUCATION (ARISE)

Tech Mahindra Foundation’s educational initiatives under ARISE are long-term school improvement programmes, in partnership with local governments and partner organisations. The Foundation in 2021-22 worked with 18 government primary schools to transform them into model schools of excellence. A total of 4,928 students were positively impacted under this programme, of which 2,646 were girls.

During the year, the Foundation expanded its work for children with special needs through its ARISE programme. This programme is a variant of ARISE in which children with special needs are provided chronic therapy as well as special education to help them lead more fulfilling lives. Through 28 projects, the programme enabled 3,792 children with special needs to become better learners with greater independence in managing their lives. The Foundation is also working

with some of the most committed NGOs in the disability sector to positively impact even more children.

SHIKSHAANTAR

Shikshaantar, envisioned as a programme for enhancing capacity of government school teachers, has emerged as an important programme in the education portfolio of the Foundation. TMF works with the Municipal Corporations in East Delhi and North Delhi by running their In-Service Teacher Education Institutes and during the year under review, as many as 9,573 teachers were trained as part of this initiative. This included specially designed modules for Digital Literacy, Child Safety, Cyber Security and Mental Health that were delivered to the teachers through online sessions. Physical training sessions with teachers resumed in the last few months of the year.

MOBILE SCIENCE LAB

In order to increase the footprint of its work in Education and reach the unreached, TMF had launched a unique initiative in 2019-20. The Mobile Science Lab (MSL). For this, a Mahindra bus has been remodeled to become a science lab on wheels and has been travelling from school to school in East Delhi to provide STEM learning for children in grades 3 and 4 in these schools. The MSL program resumed its operations in 2021-22 after a break of over a year, and during the year, as many as 4,590 students and 99 teachers were benefitted.

EMPLOYABILITY

Skills-for-Market Training (SMART) is the Foundation’s flagship programme in employability. It is built on the vision of an educated, enabled and empowered India, and the belief that educated and skilled youth are the country’s true strength. The programme started with 3 Centres in 2012 and is currently running over 85 Centres at 11 locations across India. These include SMART Centres, SMART Centres (training for people with disabilities), and SMART-T Centres (training in technical trades).

In 2021-22, your Company trained 16,715 young women and men under its SMART program, of which, 1,529 were persons with disabilities. More than 70% of the graduates are placed in jobs across multiple industries upon successful completion of the training. The average salaries being earned by the graduates of the SMART program have been steadily rising and crossed the '' 12,000 per month mark for the first time.

The Foundation’s commitment to setting new benchmarks in skill development in India has been underscored by the setting up of Tech Mahindra SMART Academies, which provide the highest quality of skill training to youngsters in Healthcare and Digital Technologies. During FY 2021-22, 1,677 students were trained at the eight Academies that are now functional - 4 in Healthcare, 3 in Digital Technologies, and 1 in Logistics.

TMF’S WORK IN COVID RELIEF

As FY 2021-22 began, the country was swept by a severe second wave of COVID-19, devastating large sections of the population. Continuing the COVID relief operations of the previous year, Tech Mahindra Foundation reached out to some of the most marginalized and vulnerable communities

- distributing ration kits, cooked meals, medical equipment, masks and PPE kits. More significantly, the Foundation managed to donate 20 fully equipped ambulances and install 10 oxygen plants at various charitable hospitals. In all, the COVID relief efforts of the Foundation have impacted over 2.3 million lives in 17 States of India through a wide range of initiatives.

MAHINDRA EDUCATIONAL INSTITUTIONS (MEI)

MEI - a not-for-profit, 100% subsidiary of the Company has set up Mahindra Ecole Centrale in August 2014

- through a collaborative venture between Mahindra Educational Institutions and Ecole Centrale of Paris, France (now known as Centrale Supelec) and the JNTU Hyderabad - to offer undergraduate engineering programs. Through this strong Indo-French Collaboration with Centrale Supelec and Industry connect with Tech Mahindra, MEC has emerged as a disruptive player in the field of Technical Education.

MEI has sponsored the setting up of Mahindra University to introduce diverse streams of education in addition to Engineering.

MAHINDRA UNIVERSITY (MU)

Mahindra University ("MU”) (sponsored by Mahindra Educational Institutions, ("MEI”) - a not-for-profit, 100% subsidiary of Tech Mahindra), was notified on May 20, 2020 by the Government of Telangana vide The Telangana State Private Universities (Establishment and Regulation) Act, 2018. for "educating future citizens for and of a better world”.

In 2021-22, Mahindra University launched 3 new schools besides the existing Ecole Centrale School

of Engineering— School of Management, School of Law and Indira Mahindra School of Education. Each of these Schools will run UG, PG and Ph.D. programs. Further, the University has subsequently planned to launch School of Media & Liberal Arts and School of Design in the next 2 years.

Cornell University’s SC Johnson College of Business, an ivy league institution is the "Academic Partner” for School of Management. Mahindra University’s School of Management (MU - SoM) will benefit significantly from Cornell University’s expertise in curriculum development, faculty exchange programs including some specialty courses delivery by the Cornell faculty to Mahindra University students, as well as student immersion at Cornell.

The School of Law, Mahindra University, commenced operations in September 2021 in Hyderabad and was founded on the philosophy of securing justice, equality, and service to all sections of society. With the needs of modern society evolving rapidly, there is a renewed focus on the importance of the discipline of law. The School of Law will aim to make a difference to the legal profession and practice by providing a diverse, flexible curriculum and pedagogy, touching on several aspects of domestic and international law, while appraising the students of the latest trends in academia and practice.

Indira Mahindra School of Education (IMSE) commenced its academic activities in 2021, with the PhD program. IMSE’s vision is to be a focused training ground for the next generation of teachers and school leaders through study of education where both researchers and practitioners are developed for working in and on educational issues.

In the academic year 2021, a total of 817 students were admitted to the University - of which 757 students were in various UG programs, including School of Management and School of Law, 24 students in the PG programs of School of Engineering and 36 students in the Ph.D programs across all the schools.

The Annual Report on CSR activities is provided as "Annexure VIII”.

SUSTAINABILITY

Climate change, escalation of wars and the pandemic have forced the world to look at Sustainability as the savior of our existence. The impact of the present crises can be handled better if a Sustainable

• Being Net Zero: Committed to be Net zero well before 2040 through adoption of renewable energy, increasing the use of energy-efficient equipment & tools across operations, creating eco-design of services, optimizing the use of resources across operations and preserving the biodiversity of areas in which we operate.

• Saying No to plastic: Maintaining plastic-free campuses and encouraging associates and stakeholders to use eco-friendly & biodegradable materials. Spreading awareness and initiating campaigns on preventing single-use plastic.

• Reduce, Reuse, Recycle, Recover: Implement process of Reduce, Reuse, Recycle and Recover across the value chain to limit waste and enable a circular economy.

• Sustainable supply chain: Ensure our suppliers follow the highest standards of sustainable and ethical best practices; optimise logistics and transportation to reduce emissions.

• Work-life balance: Provide an assured career development path and a feasible and flexi work-life balance to our associates along with a range of associate-friendly policies and processes to reduce attrition.

• Fostering Diversity: Offering improved opportunities and increasing the number of women, members of the LGBQ community, and PwDs to promote a diverse culture in the organization.

• Employee engagement and recognition:

Working diligently towards Employee engagement and increasing the number of employees recognized every year.

• Innovation: Becoming future-ready by proactively encouraging Innovative thinking across the organization, adopting technology disruption, and going digital to reduce emissions. Incorporating technologies such as loT, Blockchain, AI and Machine Learning to develop a portfolio of sustainable solutions that help reduce emissions and other negative impacts of climate change.

• Green solutions: Investing in Smart grid, Microgrid-As-A-Service, Community Action

business strategy is adopted by organizations globally. Sustainability must become an integral part of business strategy and management to ensure business continuity and profitable growth.

Being forerunners in the sustainability space, Tech Mahindra’s long-term growth strategy has always had ESG principles embedded in its core to help mitigate risks and drive profitable growth. Adopting proactive strategies that are resilient in nature has been the key to our continued success. Sustainable transformation with a focus on low carbon future has helped us to quickly adapt to disruptive changes and leverage these capabilities towards business continuity and management. Tech Mahindra’s sustainability commitments across environmental, social and governance pillars span across all our business verticals and even extends to our value chain. Being an organization with purpose, we have delivered on our promise to run better, change faster and grow greater while also creating meaningful human experiences for all.

Tech Mahindra is sourcing renewable energy, using energy-efficient equipment, and optimizing operations to achieve ecological balance while investing in and pioneering new solutions for sustainable development. Tech Mahindra’s emphasis on ESG is seen in our commitment of achieving Carbon Neutrality by 2030 and being Net zero well-before 2040. We are making optimum use of resources, moving towards low-emission technologies, and taking 5-year targets for ensuring diversity, equality, and innovation, while also updating policies and procedures to maintain a robust and compliant governance.

Tech Mahindra is aligned towards the UN SDGs (Sustainable Development Goals) and its sustainability focus areas are as below:

• Going Carbon Neutral: Increasing use of renewable energy through onsite installations and open access; improving energy efficiency through installation of LEDs, sensors; boosting green investments by implementing Carbon Price; optimizing business travel by enabling virtual meetings; encouraging use of public transport and carpooling to reduce commute emissions; planting trees to offset carbon footprints; moving towards a low carbon economy to ensure environmental protection.

Platform for Energy, Integrated Electric Vehicle Charging systems (IEVCS), Smart data hubs and Smart Cities for our Customers to reduce their emissions.

• Individual Social Responsibility: encouraging associates to make sustainability a part of their day-to-day lives.

• Transparency: Reporting our organizational policies & practices, along with financial, environmental and social data in the Integrated Annual Report.

The recognitions received by Tech Mahindra are a validation of the performance towards the company’s commitments, the details of the awards & recognitions are included in Corporate Overview, kindly refer page no. 25 of this Annual Report.

The Integrated Annual Report is based on various global standards and frameworks such as TCFD (Taskforce on Climate Related Financial Disclosures), CDSB (Climate Disclosure Standards Board), SASB (Sustainability Accounting Standard Board) and GRI standards and assured by third party according to ISAE (International Standard on Assurance Engagement) 3000 standards.

Tech Mahindra discloses climate-related risks and opportunities in line with the recommendations of TCFD which focusses on the financial impact of climate-related changes on our operations.

The TechM Board owns all risks and opportunities. The MD & CEO of the Company chairs the CSR Committee of the Board and has the ultimate responsibility for Sustainability. He is ably supported by the Senior Management members of the Sustainability Council and the Chief Sustainability Officer who manage all aspects of climate change.

The pandemic has taught the Company some concrete lessons and new ways of management in order to thrive in the new post-pandemic world. Tech Mahindra has made good progress on its commitments to provide for a better and more sustainable future by embedding sustainability into its business strategy and ensuring economic recovery and business profitability. The Company strategy includes futureproofing our growth against impending

changes in policies and regulations and increasing our compliance readiness. Your Company are agile and adaptive to dynamic changes in internal and external intricacies with strategies in place to manage all business and ESG risks in an effective way. With a robust business continuity management framework and incident response team, the Company have ensured that we are resilient to any ESG risks.

The targets and the metrics used for managing climate-related & other risks and the progress against these targets are disclosed in the externally assured Integrated reports available on the website of the Company and can be accessed at https://www. techmahindra.com/en-in/sustainability/.

AWARDS AND RECOGNITION

Your Company continued its quest for excellence in its chosen area of business to emerge as a true global brand. Several awards and rankings continue to endorse your Company as a thought leader in the industry. Few of the Awards / recognitions received by the Company during the year 2021-22 include:

• Tech Mahindra recognized among the Economic Times Iconic Brands 2021.

• Tech Mahindra was declared winner of

NASSCOM Engineering & Innovation Excellence Awards 2021 for Service Delivery Excellence & Next-Gen Products for our projects on Vehicle Top Hats & Distributed Ledger DnD.

• Tech Mahindra listed among 2021 Best

Workplaces in Asia by Great Place to Work®.

• Tech Mahindra received HRH, The Prince

of Wales’ Terra Carta Seal in Recognition of the Company’s Commitment to Creating a Sustainable Future.

• Tech Mahindra won 3 Golds at the prestigious 2021 Stevie Awards for Great Employers.

• Tech Mahindra Recognized as the Fastest

Growing Organization in ‘Brand Strength’ by Brand Finance.

• Tech Mahindra emerges as the only Indian

company in the Forbes’ Blockchain 50.

• Mr. C. P. Gurnani has been recognized by The Economic Times among ‘Most Inspiring Business Leaders of Asia’ at The Economic Times 6th Edition Asia’s Promising Business Leaders.

• Tech Mahindra Included in Bloomberg Gender-Equality Index for Third Consecutive Year.

• Tech Mahindra was recognized for its pathbreaking sustainable efforts and was ranked 2nd amongst the Top 35 companies in Business world India’s Most Sustainable Companies 2022.

These awards are a reflection of the Company’s continued efforts in the fields of business, sustainability, human resource management and its sustained progress towards creating a better society for all.

ACKNOWLEDGEMENTS

Your Directors place on record their appreciation for the contributions made by employees towards the success of your Company more particularly ensuring business as usual in spite of the impact of COVID-19. Your Directors gratefully acknowledge the cooperation and support received from the shareholders, customers, vendors, bankers, regulatory and Governmental authorities in India and abroad.

For and on behalf of the Board

Anand G. Mahindra Place: Mumbai Chairman

Date: May 13, 2022 (DIN: 00004695)


Mar 31, 2022

Your Directors present the Thirty Fifth Annual Report along with the audited accounts of your Company for the year ended March 31, 2022.

FINANCIAL RESULTS (STANDALONE)

('' in Million)

For the year ended March 31

2022

2021

Income

362,489

305,627

Profit Before Interest, Depreciation and Tax

70,081

62,521

Interest

(636)

(632)

Depreciation

(6,599)

(6,623)

Profit Before Tax

62,846

55,266

Provision for Taxation

(13,715)

(12,875)

Profit After Tax

49,131

42,391

Other Comprehensive Income

1,081

2,453

Balance brought forward from previous year

200,874

184,021

Profit available for appropriation

249,753

226,432

Equity Dividends (Including tax on dividend)

(43,624)1

(19,335)2

Transfer to retained earnings on account of options lapsed

74

96

Transferred to Special Economic Zone re-investment reserve (net of utilisation)

-

(6,319)

Transferred from Special Economic Zone re-investment reserve on utilization

6,348

-

Balance carried forward

212,551

200,874

1 Interim Dividend (Special Dividend) for the Financial Year ended March 31,2022 and Final Dividend for the Financial Year ended March 31,2021

2 Interim Dividend (Special Dividend) for the Financial Year ended March 31,2021 and Final Dividend for the Financial Year ended March 31,2020

SHARE CAPITAL

During the year under review, your Company allotted 3,573,412 equity shares on the exercise of stock options under various Employee Stock Option Schemes. Consequently, the issued, subscribed and paid-up equity share capital has increased from '' 4,841 million divided into 968,260,067 equity shares of '' 5/- each to '' 4,859 million divided into 971,833,479 equity shares of '' 5/- each.

BUSINESS PERFORMANCE / FINANCIAL OVERVIEW

Tech Mahindra lives by the philosophy of creating a connected world built on connected experiences. It thrives on change powered by the intelligent symphony of technology and humans, designing both meaningful and sustainable experiences. Your Company is strongly positioned to succeed in this new normal and deliver what’s NXT.NOW for its customers. The Company has a rare combination of connectivity and experience as its endowment which, along with


DIVIDEND

The Board of Directors on October 25, 2021 approved a special dividend of '' 15/- per share (i.e. 300%) on par value of '' 5/- each which was paid by the Company to the shareholders whose names appeared in the Register of Members as on November 5, 2021, being the record date for the payment of dividend. Your Directors are pleased to recommend a final dividend of '' 30/- per share (including a special dividend of '' 15/- per share) on par value of '' 5/- (i.e. 600%), payable to those Shareholders whose names appear in the Register of Members as on the Book Closure Date. Thus, the total dividend for the F Y 202122 will be '' 45/- per share (i.e. 900%) similar to the dividend of '' 45/- per share (i.e. 900%) paid for the Financial Year 2020-21.

Your Company has formulated a Dividend Policy which is disclosed on the website of the Company and can be accessed at https://insights.techmahindra.com/ investors/tml-dividend-distribution-policy.pdf

its big bets on Cloud and engineering, form the Company’s NXT.NOW strategy.

The main components of the NXT.NOW Strategy are:

Connectivity - Modernizing networks has been our legacy for more than 25 years, serving the top global wireless communication service providers.

Experience - The Company provides award-winning and industry-leading capabilities in human-centric design.

Cloud - The Company continues to invest in rapidly scaling its partnerships and is uniquely positioned to deliver on the promise of Cloud, AI, and cyber security for its customers.

Engineering - The Company is home to leading products and software capabilities, enabled by a network of global excellence centers and top engineering talent.

During the Financial Year ended on March 31, 2022, the Company’s revenues grew to '' 446,460 million on consolidated basis as against '' 378,551 million in the previous year - indicating a robust growth of 18%. The growth was broad based across geographies as both Americas and Europe contributed in line with overall revenue growth. The Company also saw healthy growth across business segments in CME and Enterprise verticals.

The EBITDA on consolidated basis for the Financial Year 2022 was '' 80,200 million, a growth of 17% over the previous year EBITDA of '' 68,470 million. The resultant EBITDA margins were in a similar range - 18% in FY 2022 as against 18.1% in FY 2021. The post-tax profit of the Company increased by 25.7% to '' 55,661 million in FY 2022 as against '' 44,280 million in FY 2021.

The Company saw robust demand for digital transformation services with focus on customer experience and cloud. The Company has seen new deal wins of over USD 3,000 million in the previous year indicating a healthy growth momentum across all business verticals. Your Company’s investments in Enterprise SaaS and Hi-tech capabilities will help it cater to increasing modernization demands from businesses in Financial Year 2023 and beyond.

ACQUISITIONS

Your company made the following acquisitions during the financial year 2021-22.

DIGITALONUS

The Company on May 7, 2021, acquired 100% of the share capital of DigitalOnUs Inc. through its wholly owned subsidiary company Tech Mahindra (Americas) Inc. at a consideration of USD 120 million including earnouts and retention bonus. The company is headquartered in California, USA and is focused on Cloud Native Development and Hybrid Cloud Automation Services. This acquisition helped your Company in enhancing capability in Cloud Native Engineering and positioned the Company to develop cutting-edge digital solutions for its customers.

EVENTUS SOLUTIONS GROUP

The Company on June 18, 2021, acquired 100% of the share capital of Eventus Solutions Group, LLC (Eventus) through its wholly owned subsidiary company Tech Mahindra (Americas) Inc. at a consideration of USD 44 million including earnouts. Eventus is headquartered in Denver, Colorado, USA and has strong consulting capability in customer experience (CX) and customer management and enabled your Company to build an industry leading consulting practice in BPS business.

BERIS CONSULTING GMBH

The Company on October 1, 2021, acquired 100% of the share capital of Beris Consulting GmbH (Beris) through its subsidiary Company Tech Mahindra GmbH at a consideration of EUR 7 million including earnouts. Beris has 125 employees and helps your Company to unlock the transformational growth in the IT and application space for the automotive industry as a result of industry trends such as EV, Sharing & Mobility. It will also help your Company to expand its presence, hone local expertise and client relationships in the German market.

INFOSTAR LLC

The Company acquired 100% of the share capital of Infostar LLC (Lodestone) through its wholly owned subsidiary company Tech Mahindra (Americas) Inc. on October 25, 2021 at a consideration of USD 105 million including earnouts. Lodestone is headquartered in California, USA and helps your company to bolster end to end digital product engineering capabilities across design, build and test by employing Lodestone’s expertise in data strategy and providing end to end product quality assurance across hardware, software and data layers.

WE MAKE WEBSITES

The Company acquired 100% of the share capital of We Make Websites, UK through its step-down

subsidiary company Born London Limited, UK on October 25, 2021 at a consideration of GBP 9.4 million. The company is headquartered in UK and its offerings include Custom Shopify App Development, focused Ecommerce Agency, Design & UX, re-platforming, SEO & Data Migration, Headless Commerce, CRO, Performance Enhancement, Payments & Checkout, Compliance, Accessibility and O2O strategy.

BRAINSCALE

The Company on November 17, 2021, acquired 100% of the equity shares in Brainscale Inc. (Brainscale) through its wholly owned subsidiary company Tech Mahindra (Americas) Inc. at a consideration of USD 28.8 million including earnouts. Brainscale has expertise in Cloud consulting, Cloud enablement, Application Development and Data Analytics, which will bolster your company’s consulting capabilities in the Cloud transformation space and will enable your Company to drive growth of Cloud related IT services.

ACTIVUS

The Company on December 3, 2021, acquired 100% of the equity shares in Activus Connect LLC and Activus Connect PR LLC (together called as Activus) through its wholly owned subsidiary company Tech Mahindra (Americas) Inc. at a consideration of USD 62 million including earnouts. Activus is headquartered in Florida USA and has 1750 employees and is in the business of remote customer experience and customer care solution. This acquisition will help improve your company’s capability in the work from home Customer Experience Management by employing unique delivery model and disruptive platform called Smart Virtual.

ALLYIS

The Company on December 31, 2021, acquired 100% of the equity shares in Green Investments LLC (Allyis) through its wholly owned subsidiary company Tech Mahindra (Americas) Inc. at a consideration of USD 122.4 million including retention bonus and earnouts. Allyis is headquartered in Seattle, USA and has presence in US, Romania, Costa-Rica and India. The Indian subsidiary was acquired by Tech Mahindra Limited, at a consideration of USD 2.6 million. Allyis offers Technology consulting and managed services that help Organizations to reduce costs, improve performance which would help your Company’s capabilities in digital experience solutions and engineering, cloud and automation, BI and Analytics and Technical Support services.

CTC

The Company on January 17, 2022, acquired 100% of the equity shares in Com Tech Co IT Limited (CTC) through its wholly owned subsidiary company Tech Mahindra London Limited at a consideration of EUR 310 million including earnouts. CTC has 720 employees and is a specialized digital engineering and outsourced product development organization with development centers in Latvia and Belarus. It offers high-end-digital engineering services to some of the largest insurance and reinsurance organisations globally. Your Company also acquired 25% equity shares each in SWFT Technologies and Surance Ltd which are early stage InsurTech SaaS ventures with a proven technology.

GEOMATIC.AI

The Company acquired 80% of the share capital of Geomatic.AI Pty Ltd, Australia through its wholly owned subsidiary company Tech Mahindra (Singapore) Pte. Ltd on February 15, 2022 at a consideration of A$6 million. Geomatic.AI is headquartered in Australia and its offerings include digital platforms led nonlinear growth in partnership with AusNet Services an Australian Energy & Utilities distributor and will build digital twins for linear assets leveraging Cloud, Drone and Mobility technologies in the Geospatial domain.

DETAILS OF SUBSIDIARIES / JOINT VENTURES / ASSOCIATE COMPANIES

The performance and financial position of the subsidiaries, associate and joint venture companies included in the consolidated financial statement is provided in accordance with the provisions of Section 129 read with Rule 5 of the Companies (Accounts) Rules, 2014 containing the salient features of the financial statement of the Company’s subsidiaries/joint ventures or associate companies in Form AOC - 1 in "Annexure I” to this report.

Pursuant to Rule 8(5)(iv) of the Companies (Accounts) Rules, 2014, the names of the companies which have been incorporated or ceased to be the subsidiaries, joint ventures or associate companies during the year are provided in "Annexure II” to this report. The Company is actively pursuing the initiative on the consolidation of its subsidiaries/branches to optimize the operational costs. During the year under review, your Company has closed/merged fourteen subsidiaries.

In terms of the provisions of Regulation 24 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations 2015, Tech Mahindra (Americas) Inc. is a wholly owned unlisted material subsidiary of the Company.

The policy for determining material subsidiaries formulated by the Board of Directors is disclosed on the website of the Company and can be accessed at https://insights.techmahindra.com/investors/Policy-For-Determining-Material-Subsidiaries.pdf

UPDATE ON MERGER

The Board of Directors at its meeting held on January 31, 2021 approved the Scheme of Merger of Tech Mahindra Business Services Ltd and Born Commerce Private Ltd with the Company. Accordingly, the companies filed the petitions before the Hon’ble National Company Law Tribunal (NCLT), Mumbai and Chennai Benches respectively. The petitions are pending for final hearing as on the date of this Report.

HUMAN RESOURCES

The employees of the Company are the most critical asset to your Company. The Company has taken several steps to protect, retain, and improve the competencies of these assets including:

Hiring: War for Talent

Your Company responded to the ‘Great Resignation’ by adopting many innovative practices such as remote hiring, hybrid working, productivity to the engagement of remote workforce. With no location constraints, your Company could hire diverse talent including stay-at-home women, retired professionals, Persons with Disabilities (PwDs), gig workers, and more. Through the NXT.Town program, your Company started small centres in Tier-II and Tier-III cities across India to proactively look beyond set boundaries and focus on skill-based hiring in emerging technologies. Your Company is also committed to diversifying talent hiring at global delivery centres to improve local customer connect. Your Company has restructured its referral and campus recruitment programs to actively encourage hiring at the ‘bottom of the pyramid’. The Digital RMG platform has helped your Company proactively hire based on forecasted demand through a custom-built applicant tracking system that allows collaborative hiring and improves the candidate experience.

Learning: Build v/s Buy Talent

At your Company, learning plays a strategic role in the achievement of business goals by facilitating upskilling and creating a future-ready workforce, all the while fulfilling its associates’ career aspirations. In order to enable end-to-end digital transformation for global customers, your Company is building skills and keeping its talent pool brimming with new-age technologies. By offering skill-based and accelerated career movement allowance through the Career Acceleration Policy, your Company is encouraging niche skilling, thus creating a win-win situation. Your Company has launched a Cloud Finishing School for creating project-ready talent in Cloud technologies to fulfil business needs. After the success of the EMBARK capability building program for Program Managers, your Company has started an Architect COE for solution and technical architects who work on digital transformation. In an effort to build a roster of young and diverse leadership, the Company has launched focused young leader and women leader programs, with an emphasis on deploying them into new roles once their learning journey is complete. The Company has also partnered with Harvard to offer bite-sized learning content via the Harvard Manager Mentor (HMM) SPARK platform. Your Company continues to leverage its #NAD Learn platform to create full-stack professionals through initiatives like fresher-skilling, project-skilling, future-skilling and bench-skilling (Competence to Deployment) to create future-ready talent, in line with its NXT.NOW philosophy.

Leadership: Extreme Ownership

The natural culture of empowerment at your Company was supercharged during the pandemic as associates took ownership for their deliverables and leaders at all levels were an integral part of the decision-making process. The Leadership team of the Company aims to imbibe the following atomic habits -alternate thinking, bias for action, closure over followup, data over emotions and extreme ownership. This was reinforced through the adoption of a real-time Performance Management Dashboard for the 300 talent-to-value business leaders whose continuous executive coaching and performance management was instrumental in your Company meeting its financial and strategic goals. Apart from coaching, the Leaders at the Company have also had the opportunity to experience new forms of learning with technology-enabled pedagogies like habit builders, qubit

thinking, cinema-based learning, gamification etc. The Company also launched the Leadership Retreat, an eight-day-long learn-as-you-work residential program to replenish the physical, emotional, cognitive, and social energies of mid and senior level leaders.

Performance: Outcome-Driven

Your Company launched the Annual Performance Feedback cycle in December 2021 and has completed its performance appraisal. Aspiring to build a culture where performance is enabled through feedback, managers have been trained to engage in better performance review dialogues with their direct reports and work on an outcome-based evaluation, rather than process or effort measurement. Your Company is creating a high-performance culture through hyper-personalized incentive plans. Your Company has a suite of incentive plans that are designed to create a strong alignment between individual wealth creation and organizational performance. In addition to broad-based incentive plans, your Company has also customized quarterly sprint incentives which create avenues for instant gratification for associates across the front, middle, back offices as well as enabling functions, thereby inculcating a spirit of collaboration. With platforms like Talex, #NAD Learn and a revamped job rotations policy, your Company continued to improve internal mobility.

Wellness: Holistic Wellbeing

The ‘Wellness Before Business’ mantra followed by your Company has ensured the collective well-being and safety of its entire ecosystem of stakeholders, including associates, customers, and partners. The Wealth of Wellness (WoW) program ensures preventive, personalized, and proactive holistic wellness across all 8 dimensions of wellness including physical, mental, emotional, and financial parameters. The Company has launched new policies like the Bereavement Support for Dependents (COVID Support) Policy, Sabbatical Leave Policy, and more in response to the unique challenges posed by the pandemic. Your Company also provided financial security and crucial support through the Associate Welfare Trust for 190 associates, disbursing '' 2.8 crores. To highlight the importance of physical well-being, your Company launched the Wellness 101 Challenge as well as the Run Anywhere virtual marathon to engage its associates who predominantly worked from home and encouraged them to reclaim their fitness. Mental well-being was prioritized through initiatives like the Mind Plan, People Care Manager Program and the Emotional Wellness Self-Assessment.

Pandemic: #ResolveToRise

#ResolveToRise was an organization-wide campaign by the Company, rallying associates to embrace the Rise credo and encouraging them to stay strong by sharing inspiring stories and initiatives from the ground, including COVID warriors assisting those in need, Company-led innovations using #TechForGood to help the most vulnerable, community-wide volunteering efforts, and more. During the pandemic, the Company also setup a COVID-19 Support Fund, providing much-needed relief to affected families, setting up oxygen plants and donating ambulances to charitable hospitals. Your Company also setup COVID care centres at five major locations to help both associates and the larger community. Through the SOS Seva, your Company helped patients access critical care including hospital beds, oxygen cylinders, oxygen concentrators, medicines, and plasma. Through a series of vaccination drives, your Company has encouraged protection and prevention, vaccinating associates, their family members, and other third-party staff.

Communication: Building Purpose

Through effective internal communications, your Company ensures that the connected purpose of the organisation is communicated to all associates, thus reiterating the core philosophy of the brand: creating a connected world with connected experiences. With hybrid working being the norm, your Company has made virtual connectedness a way of life through various digital initiatives that were purpose-led, peoplecentric, and performance-driven. Multiple mediums were used to reach out to associates including social media, e-chats, emailers, campaigns, screensavers and more. With a 360-degree-communication approach, your Company has built a culture that is based on celebration, positive change, and the credo of Rise which has resulted in a unifying pride for the Company - their #LoveToBeTechM.

Diversity: Being Yourself

Your Company considers ‘diversity of people’, ensuring ‘equitable opportunities’ and ‘inclusion at the workplace’ as an instrument of growth. This has reflected in the definition of the new vision statement of your Company. The earlier Vision 2021 was about fostering innovation and that comes from ‘diversity of thought’. The new Vision 2024 is about creating a purpose-led company. Your Company is committed to pursuing ‘Purpose beyond Profits’ by embedding Environmental, Social and Governance

Engagement: TechM CARES Survey

Your Company has taken active steps to build remote engagement by creating virtual ‘water-cooler’ moments and updating policies in line with the ‘new normal’. To ensure that associates were continuously engaged through the right channels and received the right information at the right time, your Company followed the 4C model - Connect, Collaborate, Career, and Celebrate. Associates have expressed their confidence and delight through the TechM CARES survey where your Company has secured an overall rating of 4.58/5 - the highest score in its history. This engagement score represents a 54 basis points increase over the last survey score of 4.04/5 and reinforces your Company’s commitment to create human-centered experiences for its associates.

QUALITY

The Company continues its focus on quality and strives to exceed customer expectations at all times. During the year, it continued to strengthen the implementation of Quality systems and upgraded various processes to comply with CMMI V 2.0 for both Dev and Services. The Organization is recently assessed at Level 5 maturity. Similarly it underwent various upgrade and re-certification audits for multiple standards during the year in order to meet client demands and enhance value delivery. The Company has Successfully re-certified, ISO 9001:2015 (Quality Management System), ISO 20000-1:2018 (Information Technology Service Management System), ISO 27001:2013 (Information Security Management System), ISO 27701:2019 (Privacy Information Management System), TL9000 R 6.2/ R5.7 (Quality Management Systems for Tele Communications industry), ISO 13485:2016 (Quality Management Systems for medical devices - scope of certification limited to medical devices business within Tech Mahindra), AS9100 Rev D (Standard for Aerospace domain - scope of certification limited to the aerospace business within Tech Mahindra), ISO 17025:2017 - Laboratory Quality Management Systems for device testing labs.

In addition to these, your Company also maintains its commitment to health, safety and environment by continually improving its processes in accordance with ISO 14001:2015 (Environmental Management System) and ISO 45001: 2018 (Occupational Health and Safety Assessment Series) standards. Your Company is also certified on ISO 22301:2012 (Societal Security and

(ESG) principles into its core strategy, thus creating a long-term positive impact on the planet and society while providing greater value for all its stakeholders. Improvements in Diversity, Equity and Inclusion practices is critical to improve the Social aspect of ESG, and hence your Company has defined a roadmap for improvements across the dimensions of Gender, Generation, People with Disabilities, the LGBTQ community as well as cultures and nationalities. This also links back to the stated objective of your Company to be human-centered by encouraging associates to bring their most authentic selves to work.

Recognition: People at the Core

While timely recognition is key to a happy workforce, your Company also prioritizes creating a culture of appreciation. Your Company’s robust digital platform ensures both recognition and appreciation with monetary and non-monetary rewards badges linked to redemption points. Your Company also encourages its associates to donate their reward points towards social causes and has an industryleading rewards penetration of approximately 40%. To celebrate achievements in the virtual world, your Company introduced the quarterly Spotlight awards and other timely sales- focused awards to reward growth, collaboration, and high-impact initiatives. Your Company also included associates’ family members to virtually felicitate both Long Service Awardees and ACERs (consistent performers for two years) for their outstanding contributions and commitment.

HR Digitization: Automation at every Step

Your Company has continued to invest in its flagship product, ‘Dove,’ for new joiners, enabling new capabilities for document submissions and personal information updates. Your Company has continued to enhance self-service capabilities for existing associates in diverse areas such as letter generation, work permits, automated approvals, and proactive notifications for key events. Your Company has adopted Office 365 as well as the Enate and UNO platforms to automate routine business transactions through BOTs. Your Company has also taken steps to improve the post-joining and pre-exit processes to improve communication as a step towards empowering associates with the right information. Your Company has also leveraged Artificial Intelligence/ Machine learning to build internal applications to provide associates with customer-like experiences.

Business Continuity Management System) and has a comprehensive Business Continuity and Disaster Recovery framework, to prevent potential business disruptions in the event of any disaster. The Company has processes that helped resume services to customer’s acceptable service levels. Automated Service Desk with SLAs for enabling business and Vulnerability Assessment and Penetration Testing Lab for secured corporate network operations are highlights that showcase the information security posture of the Organization.

During the second year of the pandemic, the entire quality management system was put to test with majority of the associates working from home. Complying with the Company’s security requirements, they were able to deliver services as per contractual commitments, leading to great customer satisfaction.

Tech Mahindra (IT Division) has been assessed for the implementation of high maturity business excellence practices at Mahindra Group (Services Sector). It has been assessed at TMW Maturity Stage 7 (on scale of 1-10 stages) of Mahindra Business Excellence Framework - The Mahindra Way. These certifications are testimony of the robustness of business processes and at large the quality culture imbibed in the organization.

Your Company has continued to strengthen the process for transforming Quality Assurance processes & delivery methods to adopt and strengthen Delivery excellence, Risk governance, and further enhance automation to enable quality delivery to the customer. Quality index which is a measure of quality of products and services delivery is institutionalized.

All these actions are being taken to ensure that the Company deliver as stated in its Quality Policy.

DIRECTORS

During the year under review, all Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Independent Directors have also given declaration of compliance with Rules 6(1) and 6(2) of the Companies (Appointment and Qualification of Directors) Rules, 2014, with respect to

their name appearing in the data bank of Independent Directors maintained by the Indian Institute of Corporate Affairs.

Pursuant to the provisions of Section 152(6)(c) of the Companies Act, 2013, Mr. C. P. Gurnani, Managing Director & CEO (DIN: 00018234) is liable to retire by rotation and offers himself for reappointment.

Further the term of Mr. C. P. Gurnani as Managing Director & CEO expires on August 9, 2022. The Board of Directors based on the recommendation of Nomination and Remuneration Committee considering the performance of the Managing Director & CEO over the last 10 years & his contribution to the growth of the Company approved and recommends the re-appointment of Mr. C. P. Gurnani as Managing Director & CEO for another term from August 10, 2022 upto December 19, 2023, which is his date of retirement from the Company, subject to the approval of shareholders at the ensuing Annual General Meeting.

Your Directors co-opted Ms. Penelope Fowler (DIN: 09591815) as an Additional Director with effect from May 13, 2022. The term of Ms. Fowler will end at the ensuing Annual General Meeting. As Ms. Penelope Fowler meets the criteria of an Independent Director, the Board recommends her appointment as an Independent Director for a period of 5 years for the approval of shareholders at the ensuing Annual General Meeting.

Mr. M. Damodaran (DIN: 00125299) has retired as an Independent Director of the Company with effect from March 31, 2022. Your Board places on record its sincere appreciation for the valuable contribution and timely guidance from Mr. M. Damodaran to the Company during his tenure.

In terms of Regulation 24(1) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations 2015, Mr. T. N. Manoharan, Lead Independent Director of the Company has been appointed as Director on the Board of Tech Mahindra (Americas) Inc., a wholly owned unlisted material subsidiary of the Company with effect from May 21, 2019.

In the opinion of the Board of Directors the Independent Directors have relevant proficiency, expertise and experience.

i. Policy on the appointment and removal of Directors, Key Managerial Personnel and Senior Management.

ii. Policy on remuneration to the Directors, Key Managerial Personnel and Senior Management and other Employees.

The extract of these two policies is provided in "Annexure III''

The policies are available on the website of the Company and can be accessed at https://insights. techmahindra.com/investors/Governance-Policies-including-remuneration-to-Directors-KMPS.pdf

SUCCESSION PLAN

In accordance with the principles of transparency and consistency, your Company has adopted governance policies for appointments, remuneration and evaluation of its Board of Directors, Key Managerial Personnel & Senior Management. In line with these Governance policies, the Company has established a formal Succession Planning Program for key managerial persons across the organization. The Board evaluates all such plans at a regular interval and institutes a formal program for filling any such critical position. The Board evaluates both internal and external candidates for such positions alongwith the recommendations of the Company. The Company also has a leadership development program where it identifies high potential managers, and trains them to take up the positions of higher responsibility. The Company has identified the second line of leadership, which provides stability to the business in any contingencies.

TRAINING

The Company has laid down a policy on the training of Independent Directors as part of its governance policies. The Senior Leadership of the Company periodically updates the Directors on regulatory changes, business strategy and the Company has laid down a policy on the training of Independent Directors as part of its governance policies. The Senior Leadership of the Company periodically updates the Directors on regulatory changes, business strategy and operations.

KEY MANAGERIAL PERSONNEL (KMP) Pursuant to provisions of Section 203 of the Companies Act, 2013, Mr. C. P Gurnani, Managing Director & Chief Executive Officer, Mr. Manoj Bhat, Chief Financial Officer (up to April 1, 2021), Mr. Milind Kulkarni,


FAMILIARISATION PROGRAMME

These programmes aim to provide insights into the Company to enable the Independent Directors to understand its business in depth and contribute significantly to the Company. The details of program for familiarisation of the Independent Directors with the Company are available on its website and can be accessed at https://insights.techmahindra.com/ investorsltml-familarisation-progarmmes-for-IDs.pdf

The Board members are also regularly updated on changes in statutory provisions like changes in Corporate Laws, SEBI Regulations, Taxation Laws and People related laws as applicable at the quarterly Board meetings. The Board members are also updated on the Risk universe applicable to the Company’s business. The MD & CEO of the Company had quarterly sessions with Board members sharing updates about the Company’s business strategy, operations and the key trends in the IT industry that are relevant to the Company. These updates help the Board members in keeping abreast of key changes and their impact on the Company.

BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and Regulation 19 read with Schedule II, Part D of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has devised a policy on evaluating the performance of the Board of Directors, the Chairman, Committees, and Individual Directors. The evaluation process was carried out through a web-based portal. The summary of the evaluation reports was presented to the respective Committees and the Board. The Directors had given a positive feedback on the overall functioning of the Committees and the Board. The suggestions made by the Directors in the evaluation process have been suitably incorporated in the processes.

NUMBER OF MEETINGS OF THE BOARD

The Board met four times during the Financial Year 2021-22. The meeting details are provided in Corporate Governance report that forms part of this Annual Report. The maximum interval between any two meetings did not exceed 120 days as prescribed in the Companies Act, 2013 and SEBI Listing Regulations.

POLICY ON DIRECTORS’ APPOINTMENT AND REMUNERATION

The Governance policies laid down by the Board of Directors of your Company include:

are adequate for ensuring the orderly and efficient conduct of the business, including adherence to the Company’s policies, the safe guarding of assets, the prevention and detection of frauds and errors, the accuracy and completeness of accounting records and timely preparation of reliable financial information.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS / PROCEEDINGS

There are no significant and material orders passed by the regulators or courts or tribunal impacting the going concern status and the Company’s operations in the future.

Further no application against the Company has been filed or is pending under the Insolvency and Bankruptcy Code, 2016, nor the Company has done any one time settlement with any Bank or Financial institutions.

STATUTORY AUDITORS

The members, in the 30th Annual General Meeting (AGM) held on August 1, 2017, appointed

M/s. B S R & Co. LLP, Chartered Accountants, [ICAI Firm’s Registration No. 101248W/W- 100022] as the Statutory Auditors of the Company, to hold office for a term of five years from the conclusion of the 30th AGM of the Company held in the Financial Year 2017-18 until the conclusion of the AGM of the Company for the Financial Year 2021- 22 on such remuneration as may be determined by the Board of Directors.

Pursuant to Section 139 of the Companies Act, 2013 the Statutory Auditors M/s. B S R & Co. LLP, Chartered Accountants have confirmed that they are eligible to continue as auditors.

In accordance with provision of Section 139 of the Companies Act, 2013 read with Rules framed thereunder, the Board of Directors of the Company on the recommendation of the Audit Committee, proposes appointment of M/s. B SR & Co. LLP, Chartered Accountants (ICAI Firm’s Registration No. 101248W/W - 100022) as Statutory Auditors of the Company to hold office from the conclusion of ensuing 35th AGM for a term of five consecutive years till the conclusion of 40th AGM. The appointment of M/s. B S R & Co. LLP as the statutory auditors of the Company is placed before the members for approval at the ensuing AGM.

As required under provision of Section 139(1) of the Companies Act, 2013 the Company has received a written consent from M/s. B S R & Co. LLP for their

Chief Financial Officer (w.e.f. April 2, 2021) and Mr. Anil Khatri, Company Secretary & Compliance Officer were the Key Managerial Personnel of the Company during the year under review. Mr. Milind Kulkarni will retire as Chief Financial Officer of the Company w.e.f. May 31, 2022 and Mr. Rohit Anand was appointed as Chief Financial Officer of the Company w.e.f. June 1, 2022.

DIRECTORS’ RESPONSIBILITY STATEMENT

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

i. in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

ii. they have, in the selection of the accounting policies, consulted the Statutory Auditors and these have been applied consistently and, reasonable and prudent judgments and estimates have been made so as to give a true and fair view of the state of affairs of the Company as at March 31, 2022 and of the profit of the Company for the year ended on that date;

iii. proper and sufficient care had been taken 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 other irregularities;

iv. the annual accounts have been prepared on a going concern basis;

v. they had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively;

vi. the proper systems to ensure compliance with the provisions of all applicable laws are in place and are adequate and operating effectively.

DETAILS WITH RESPECT TO ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS

The Company has internal financial controls which are adequate and were operating effectively. The controls appointment and a certificate to the effect that their appointment, if made, would be in accordance with the Companies Act, 2013 and the Rules framed thereunder and that they satisfy the criteria provided in Section 141 of the Companies Act, 2013 read with Rule 4(1) of the Companies (Audit and Auditors) Rules, 2014 and that they are not disqualified for appointment as statutory auditors of the Company.

There are no qualifications, reservations, adverse remarks or disclaimer made in the audit report for the Financial Year 2021-22.

SECRETARIAL AUDIT REPORT

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 had appointed Mr. Makarand Lele & Co., Practicing Company Secretary, Pune to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is available at ‘Annexure IV” to this report. There are no qualifications, reservations, adverse remarks or disclaimer made in the Secretarial Audit Report.

COMPLIANCE WITH SECRETARIAL STANDARDS

The Company has complied with the applicable Secretarial Standards.

ANNUAL RETURN

Pursuant to the provisions of Section 92(3) read with Section 134(3) (a) of the Companies Act, 2013, the Annual Return in Form MGT-7 is available on the website of the Company and can be accessed at https://insights.techmahindra.com/investors/mgt7-annual-return-2021-22.pdf

MANAGERIAL REMUNERATION

Disclosures of the ratio of the remuneration of each director to the median employee’s remuneration and other details as required pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended from time to time, are provided as "Annexure V”.

None of the directors or Managing Director & CEO of the Company, received any remuneration or commission from Subsidiary Companies of your Company.

The details of remuneration paid to the Directors including the Managing Director & CEO of the Company is provided in Corporate Governance Report.

PARTICULARS OF EMPLOYEES

The information required under Section 197(12) of the Companies Act, 2013 ("the Act”) read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms part of this Report. However, pursuant to first proviso to Section 136(1) of the Act, this Report is being sent to the Shareholders excluding the aforesaid information. Any shareholder interested in obtaining said information, may write to the Company Secretary at the Registered Office / Corporate Office of the Company and the said information is open for inspection at the Registered Office of the Company.

POLICY ON PREVENTION OF SEXUAL HARASSMENT

Your Company laid down the Prevention of Sexual Harassment (POSH) policy which is available on its website. The Company has zero tolerance on Sexual Harassment at workplace. During the year under review there were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

The status of complaints received under POSH and redressed by the POSH Committee of the Company, during the Financial Year under review, are given below:

a) Number of complaints received - 45

b) Number of complaints redressed - 43

c) Number of complaints pending - 2

There are focused campaigns on the POSH policy within the Company and awareness drives that take place with the help of its BPS teams. Furthermore, the employees are required to undertake a mandatory annual certification on POSH to sensitize themselves and strengthen their awareness.

EMPLOYEE STOCK OPTION SCHEMES

During the year under review, there were no material changes in the Employee Stock Option Schemes (ESOPs) of the Company and the Schemes are in compliance with the SEBI Regulations on ESOPs.

As per Regulation 14 of Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021, the details of the ESOPs are uploaded on the website of the Company and can be accessed at https://insights.techmahindra. com/investors/Details-of-ESOPs-FY-2021-22.pdf

CORPORATE GOVERNANCE

A report on Corporate Governance covering among others composition, details of meetings of the Board and Committees along with a certificate for compliance with the conditions of Corporate Governance in accordance with the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, issued by the Statutory Auditors of the Company, forms part of this Annual Report.

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.

COST RECORDS

Maintenance of cost records and requirement of cost audit as prescribed under the provisions of Section 148(1) of the Companies Act, 2013 are not applicable for the business activities of the Company.

RISK MANAGEMENT

The Risk Management Committee of the Board of Directors guides the operating management to identify risks, analyze their probability and impact and prepare mitigation plans. It periodically reviews the Risk Management Framework & Enterprise Risk Register which is presented by the Chief Risk Officer. The Company identifies all potential risks viz. economical, business, currency, operational, climate, governance, financial, cyber, business continuity etc. and prepares a mitigation plan for each of the risks. The elements of risk as identified by the Company with the impact and mitigation strategy are set out in the Management Discussion and Analysis Report (MDA).

ESTABLISHMENT OF VIGIL MECHANISM

The Company has laid down Whistle Blower Policy covering Vigil Mechanism with protective Clauses for the Whistle Blowers. The Whistle Blower Policy is made available on the website of the Company.

DEPOSITS / LOANS & ADVANCES, GUARANTEES OR INVESTMENTS

The Company has not accepted any deposits from the public during the year under review. The particulars of loans/advances, guarantees and investments under Section 186 of the Companies Act, 2013 are given in the notes forming part of the Financial Statements.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All transactions entered into with Related Parties as defined under Section 2(76) of the Companies Act, 2013 and Regulation 23 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, ("The Listing Regulations”), during the Financial Year under review were in the ordinary course of business and at an arm’s length pricing basis and do not attract the provisions of Section 188 of the Companies Act, 2013. There were no transactions with related parties in the Financial Year which were in conflict with the interest of the Company and requiring compliance of the provisions of Regulation 23 of the Listing Regulations.

Suitable disclosure as required by the Indian Accounting Standards (Ind AS 24) has been made in the notes forming part of the Financial Statements.

The Company has formulated a policy on the materiality of Related Party Transactions and dealing with Related Party Transactions which has been uploaded on the website of the Company and can be accessed at https://insights.techmahindra.com/investors/Related-Party-Transactions-Policy.pdf

The particulars of related party transactions in prescribed Form AOC - 2 are attached

as ‘Annexure VI”.

Pursuant to Regulation 23(9) of the Listing Regulations, your Company has filed half yearly report on Related Party Transactions with the stock exchanges.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars as prescribed under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 are provided in “Annexure VII” which forms part of this report.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

The CSR vision of the Company is "Empowerment through Education.”

In compliance with the guidelines prescribed under Section 135 of the Companies Act, 2013, your Company has constituted a Corporate Social Responsibility (CSR) Committee of the Board. The CSR policy, covering the Objectives, Focus Areas, Governance Structure Monitoring and Reporting Framework among others is approved by the Board of Directors. In accordance with the amendments made in Section 135 in January 2021, the CSR Policy has been duly revised and is available on the website of the Company and can be accessed at https://files. techmahindra.com/static/img/pdf/csr-policy-techm-v3-march2021.pdf

The Company has spent more than 2% of the average net profits of the Company during the three immediately preceding Financial Years on CSR.

The Company’s social initiatives are mainly carried out by Tech Mahindra Foundation and Mahindra Educational Institutions, Section 8 (erstwhile Section 25) Companies promoted by the Company.

TECH MAHINDRA FOUNDATION (TMF) EDUCATION

The key initiatives taken by TMF in the arena of school education include:

ALL ROUND IMPROVEMENT IN SCHOOL EDUCATION (ARISE)

Tech Mahindra Foundation’s educational initiatives under ARISE are long-term school improvement programmes, in partnership with local governments and partner organisations. The Foundation in 2021-22 worked with 18 government primary schools to transform them into model schools of excellence. A total of 4,928 students were positively impacted under this programme, of which 2,646 were girls.

During the year, the Foundation expanded its work for children with special needs through its ARISE programme. This programme is a variant of ARISE in which children with special needs are provided chronic therapy as well as special education to help them lead more fulfilling lives. Through 28 projects, the programme enabled 3,792 children with special needs to become better learners with greater independence in managing their lives. The Foundation is also working

with some of the most committed NGOs in the disability sector to positively impact even more children.

SHIKSHAANTAR

Shikshaantar, envisioned as a programme for enhancing capacity of government school teachers, has emerged as an important programme in the education portfolio of the Foundation. TMF works with the Municipal Corporations in East Delhi and North Delhi by running their In-Service Teacher Education Institutes and during the year under review, as many as 9,573 teachers were trained as part of this initiative. This included specially designed modules for Digital Literacy, Child Safety, Cyber Security and Mental Health that were delivered to the teachers through online sessions. Physical training sessions with teachers resumed in the last few months of the year.

MOBILE SCIENCE LAB

In order to increase the footprint of its work in Education and reach the unreached, TMF had launched a unique initiative in 2019-20. The Mobile Science Lab (MSL). For this, a Mahindra bus has been remodeled to become a science lab on wheels and has been travelling from school to school in East Delhi to provide STEM learning for children in grades 3 and 4 in these schools. The MSL program resumed its operations in 2021-22 after a break of over a year, and during the year, as many as 4,590 students and 99 teachers were benefitted.

EMPLOYABILITY

Skills-for-Market Training (SMART) is the Foundation’s flagship programme in employability. It is built on the vision of an educated, enabled and empowered India, and the belief that educated and skilled youth are the country’s true strength. The programme started with 3 Centres in 2012 and is currently running over 85 Centres at 11 locations across India. These include SMART Centres, SMART Centres (training for people with disabilities), and SMART-T Centres (training in technical trades).

In 2021-22, your Company trained 16,715 young women and men under its SMART program, of which, 1,529 were persons with disabilities. More than 70% of the graduates are placed in jobs across multiple industries upon successful completion of the training. The average salaries being earned by the graduates of the SMART program have been steadily rising and crossed the '' 12,000 per month mark for the first time.

The Foundation’s commitment to setting new benchmarks in skill development in India has been underscored by the setting up of Tech Mahindra SMART Academies, which provide the highest quality of skill training to youngsters in Healthcare and Digital Technologies. During FY 2021-22, 1,677 students were trained at the eight Academies that are now functional - 4 in Healthcare, 3 in Digital Technologies, and 1 in Logistics.

TMF’S WORK IN COVID RELIEF

As FY 2021-22 began, the country was swept by a severe second wave of COVID-19, devastating large sections of the population. Continuing the COVID relief operations of the previous year, Tech Mahindra Foundation reached out to some of the most marginalized and vulnerable communities

- distributing ration kits, cooked meals, medical equipment, masks and PPE kits. More significantly, the Foundation managed to donate 20 fully equipped ambulances and install 10 oxygen plants at various charitable hospitals. In all, the COVID relief efforts of the Foundation have impacted over 2.3 million lives in 17 States of India through a wide range of initiatives.

MAHINDRA EDUCATIONAL INSTITUTIONS (MEI)

MEI - a not-for-profit, 100% subsidiary of the Company has set up Mahindra Ecole Centrale in August 2014

- through a collaborative venture between Mahindra Educational Institutions and Ecole Centrale of Paris, France (now known as Centrale Supelec) and the JNTU Hyderabad - to offer undergraduate engineering programs. Through this strong Indo-French Collaboration with Centrale Supelec and Industry connect with Tech Mahindra, MEC has emerged as a disruptive player in the field of Technical Education.

MEI has sponsored the setting up of Mahindra University to introduce diverse streams of education in addition to Engineering.

MAHINDRA UNIVERSITY (MU)

Mahindra University ("MU”) (sponsored by Mahindra Educational Institutions, ("MEI”) - a not-for-profit, 100% subsidiary of Tech Mahindra), was notified on May 20, 2020 by the Government of Telangana vide The Telangana State Private Universities (Establishment and Regulation) Act, 2018. for "educating future citizens for and of a better world”.

In 2021-22, Mahindra University launched 3 new schools besides the existing Ecole Centrale School

of Engineering— School of Management, School of Law and Indira Mahindra School of Education. Each of these Schools will run UG, PG and Ph.D. programs. Further, the University has subsequently planned to launch School of Media & Liberal Arts and School of Design in the next 2 years.

Cornell University’s SC Johnson College of Business, an ivy league institution is the "Academic Partner” for School of Management. Mahindra University’s School of Management (MU - SoM) will benefit significantly from Cornell University’s expertise in curriculum development, faculty exchange programs including some specialty courses delivery by the Cornell faculty to Mahindra University students, as well as student immersion at Cornell.

The School of Law, Mahindra University, commenced operations in September 2021 in Hyderabad and was founded on the philosophy of securing justice, equality, and service to all sections of society. With the needs of modern society evolving rapidly, there is a renewed focus on the importance of the discipline of law. The School of Law will aim to make a difference to the legal profession and practice by providing a diverse, flexible curriculum and pedagogy, touching on several aspects of domestic and international law, while appraising the students of the latest trends in academia and practice.

Indira Mahindra School of Education (IMSE) commenced its academic activities in 2021, with the PhD program. IMSE’s vision is to be a focused training ground for the next generation of teachers and school leaders through study of education where both researchers and practitioners are developed for working in and on educational issues.

In the academic year 2021, a total of 817 students were admitted to the University - of which 757 students were in various UG programs, including School of Management and School of Law, 24 students in the PG programs of School of Engineering and 36 students in the Ph.D programs across all the schools.

The Annual Report on CSR activities is provided as "Annexure VIII”.

SUSTAINABILITY

Climate change, escalation of wars and the pandemic have forced the world to look at Sustainability as the savior of our existence. The impact of the present crises can be handled better if a Sustainable

• Being Net Zero: Committed to be Net zero well before 2040 through adoption of renewable energy, increasing the use of energy-efficient equipment & tools across operations, creating eco-design of services, optimizing the use of resources across operations and preserving the biodiversity of areas in which we operate.

• Saying No to plastic: Maintaining plastic-free campuses and encouraging associates and stakeholders to use eco-friendly & biodegradable materials. Spreading awareness and initiating campaigns on preventing single-use plastic.

• Reduce, Reuse, Recycle, Recover: Implement process of Reduce, Reuse, Recycle and Recover across the value chain to limit waste and enable a circular economy.

• Sustainable supply chain: Ensure our suppliers follow the highest standards of sustainable and ethical best practices; optimise logistics and transportation to reduce emissions.

• Work-life balance: Provide an assured career development path and a feasible and flexi work-life balance to our associates along with a range of associate-friendly policies and processes to reduce attrition.

• Fostering Diversity: Offering improved opportunities and increasing the number of women, members of the LGBQ community, and PwDs to promote a diverse culture in the organization.

• Employee engagement and recognition:

Working diligently towards Employee engagement and increasing the number of employees recognized every year.

• Innovation: Becoming future-ready by proactively encouraging Innovative thinking across the organization, adopting technology disruption, and going digital to reduce emissions. Incorporating technologies such as loT, Blockchain, AI and Machine Learning to develop a portfolio of sustainable solutions that help reduce emissions and other negative impacts of climate change.

• Green solutions: Investing in Smart grid, Microgrid-As-A-Service, Community Action

business strategy is adopted by organizations globally. Sustainability must become an integral part of business strategy and management to ensure business continuity and profitable growth.

Being forerunners in the sustainability space, Tech Mahindra’s long-term growth strategy has always had ESG principles embedded in its core to help mitigate risks and drive profitable growth. Adopting proactive strategies that are resilient in nature has been the key to our continued success. Sustainable transformation with a focus on low carbon future has helped us to quickly adapt to disruptive changes and leverage these capabilities towards business continuity and management. Tech Mahindra’s sustainability commitments across environmental, social and governance pillars span across all our business verticals and even extends to our value chain. Being an organization with purpose, we have delivered on our promise to run better, change faster and grow greater while also creating meaningful human experiences for all.

Tech Mahindra is sourcing renewable energy, using energy-efficient equipment, and optimizing operations to achieve ecological balance while investing in and pioneering new solutions for sustainable development. Tech Mahindra’s emphasis on ESG is seen in our commitment of achieving Carbon Neutrality by 2030 and being Net zero well-before 2040. We are making optimum use of resources, moving towards low-emission technologies, and taking 5-year targets for ensuring diversity, equality, and innovation, while also updating policies and procedures to maintain a robust and compliant governance.

Tech Mahindra is aligned towards the UN SDGs (Sustainable Development Goals) and its sustainability focus areas are as below:

• Going Carbon Neutral: Increasing use of renewable energy through onsite installations and open access; improving energy efficiency through installation of LEDs, sensors; boosting green investments by implementing Carbon Price; optimizing business travel by enabling virtual meetings; encouraging use of public transport and carpooling to reduce commute emissions; planting trees to offset carbon footprints; moving towards a low carbon economy to ensure environmental protection.

Platform for Energy, Integrated Electric Vehicle Charging systems (IEVCS), Smart data hubs and Smart Cities for our Customers to reduce their emissions.

• Individual Social Responsibility: encouraging associates to make sustainability a part of their day-to-day lives.

• Transparency: Reporting our organizational policies & practices, along with financial, environmental and social data in the Integrated Annual Report.

The recognitions received by Tech Mahindra are a validation of the performance towards the company’s commitments, the details of the awards & recognitions are included in Corporate Overview, kindly refer page no. 25 of this Annual Report.

The Integrated Annual Report is based on various global standards and frameworks such as TCFD (Taskforce on Climate Related Financial Disclosures), CDSB (Climate Disclosure Standards Board), SASB (Sustainability Accounting Standard Board) and GRI standards and assured by third party according to ISAE (International Standard on Assurance Engagement) 3000 standards.

Tech Mahindra discloses climate-related risks and opportunities in line with the recommendations of TCFD which focusses on the financial impact of climate-related changes on our operations.

The TechM Board owns all risks and opportunities. The MD & CEO of the Company chairs the CSR Committee of the Board and has the ultimate responsibility for Sustainability. He is ably supported by the Senior Management members of the Sustainability Council and the Chief Sustainability Officer who manage all aspects of climate change.

The pandemic has taught the Company some concrete lessons and new ways of management in order to thrive in the new post-pandemic world. Tech Mahindra has made good progress on its commitments to provide for a better and more sustainable future by embedding sustainability into its business strategy and ensuring economic recovery and business profitability. The Company strategy includes futureproofing our growth against impending

changes in policies and regulations and increasing our compliance readiness. Your Company are agile and adaptive to dynamic changes in internal and external intricacies with strategies in place to manage all business and ESG risks in an effective way. With a robust business continuity management framework and incident response team, the Company have ensured that we are resilient to any ESG risks.

The targets and the metrics used for managing climate-related & other risks and the progress against these targets are disclosed in the externally assured Integrated reports available on the website of the Company and can be accessed at https://www. techmahindra.com/en-in/sustainability/.

AWARDS AND RECOGNITION

Your Company continued its quest for excellence in its chosen area of business to emerge as a true global brand. Several awards and rankings continue to endorse your Company as a thought leader in the industry. Few of the Awards / recognitions received by the Company during the year 2021-22 include:

• Tech Mahindra recognized among the Economic Times Iconic Brands 2021.

• Tech Mahindra was declared winner of

NASSCOM Engineering & Innovation Excellence Awards 2021 for Service Delivery Excellence & Next-Gen Products for our projects on Vehicle Top Hats & Distributed Ledger DnD.

• Tech Mahindra listed among 2021 Best

Workplaces in Asia by Great Place to Work®.

• Tech Mahindra received HRH, The Prince

of Wales’ Terra Carta Seal in Recognition of the Company’s Commitment to Creating a Sustainable Future.

• Tech Mahindra won 3 Golds at the prestigious 2021 Stevie Awards for Great Employers.

• Tech Mahindra Recognized as the Fastest

Growing Organization in ‘Brand Strength’ by Brand Finance.

• Tech Mahindra emerges as the only Indian

company in the Forbes’ Blockchain 50.

• Mr. C. P. Gurnani has been recognized by The Economic Times among ‘Most Inspiring Business Leaders of Asia’ at The Economic Times 6th Edition Asia’s Promising Business Leaders.

• Tech Mahindra Included in Bloomberg Gender-Equality Index for Third Consecutive Year.

• Tech Mahindra was recognized for its pathbreaking sustainable efforts and was ranked 2nd amongst the Top 35 companies in Business world India’s Most Sustainable Companies 2022.

These awards are a reflection of the Company’s continued efforts in the fields of business, sustainability, human resource management and its sustained progress towards creating a better society for all.

ACKNOWLEDGEMENTS

Your Directors place on record their appreciation for the contributions made by employees towards the success of your Company more particularly ensuring business as usual in spite of the impact of COVID-19. Your Directors gratefully acknowledge the cooperation and support received from the shareholders, customers, vendors, bankers, regulatory and Governmental authorities in India and abroad.

For and on behalf of the Board

Anand G. Mahindra Place: Mumbai Chairman

Date: May 13, 2022 (DIN: 00004695)


Mar 31, 2022

Your Directors present the Thirty Fifth Annual Report along with the audited accounts of your Company for the year ended March 31, 2022.

FINANCIAL RESULTS (STANDALONE)

('' in Million)

For the year ended March 31

2022

2021

Income

362,489

305,627

Profit Before Interest, Depreciation and Tax

70,081

62,521

Interest

(636)

(632)

Depreciation

(6,599)

(6,623)

Profit Before Tax

62,846

55,266

Provision for Taxation

(13,715)

(12,875)

Profit After Tax

49,131

42,391

Other Comprehensive Income

1,081

2,453

Balance brought forward from previous year

200,874

184,021

Profit available for appropriation

249,753

226,432

Equity Dividends (Including tax on dividend)

(43,624)1

(19,335)2

Transfer to retained earnings on account of options lapsed

74

96

Transferred to Special Economic Zone re-investment reserve (net of utilisation)

-

(6,319)

Transferred from Special Economic Zone re-investment reserve on utilization

6,348

-

Balance carried forward

212,551

200,874

1 Interim Dividend (Special Dividend) for the Financial Year ended March 31,2022 and Final Dividend for the Financial Year ended March 31,2021

2 Interim Dividend (Special Dividend) for the Financial Year ended March 31,2021 and Final Dividend for the Financial Year ended March 31,2020

SHARE CAPITAL

During the year under review, your Company allotted 3,573,412 equity shares on the exercise of stock options under various Employee Stock Option Schemes. Consequently, the issued, subscribed and paid-up equity share capital has increased from '' 4,841 million divided into 968,260,067 equity shares of '' 5/- each to '' 4,859 million divided into 971,833,479 equity shares of '' 5/- each.

BUSINESS PERFORMANCE / FINANCIAL OVERVIEW

Tech Mahindra lives by the philosophy of creating a connected world built on connected experiences. It thrives on change powered by the intelligent symphony of technology and humans, designing both meaningful and sustainable experiences. Your Company is strongly positioned to succeed in this new normal and deliver what’s NXT.NOW for its customers. The Company has a rare combination of connectivity and experience as its endowment which, along with


DIVIDEND

The Board of Directors on October 25, 2021 approved a special dividend of '' 15/- per share (i.e. 300%) on par value of '' 5/- each which was paid by the Company to the shareholders whose names appeared in the Register of Members as on November 5, 2021, being the record date for the payment of dividend. Your Directors are pleased to recommend a final dividend of '' 30/- per share (including a special dividend of '' 15/- per share) on par value of '' 5/- (i.e. 600%), payable to those Shareholders whose names appear in the Register of Members as on the Book Closure Date. Thus, the total dividend for the F Y 202122 will be '' 45/- per share (i.e. 900%) similar to the dividend of '' 45/- per share (i.e. 900%) paid for the Financial Year 2020-21.

Your Company has formulated a Dividend Policy which is disclosed on the website of the Company and can be accessed at https://insights.techmahindra.com/ investors/tml-dividend-distribution-policy.pdf

its big bets on Cloud and engineering, form the Company’s NXT.NOW strategy.

The main components of the NXT.NOW Strategy are:

Connectivity - Modernizing networks has been our legacy for more than 25 years, serving the top global wireless communication service providers.

Experience - The Company provides award-winning and industry-leading capabilities in human-centric design.

Cloud - The Company continues to invest in rapidly scaling its partnerships and is uniquely positioned to deliver on the promise of Cloud, AI, and cyber security for its customers.

Engineering - The Company is home to leading products and software capabilities, enabled by a network of global excellence centers and top engineering talent.

During the Financial Year ended on March 31, 2022, the Company’s revenues grew to '' 446,460 million on consolidated basis as against '' 378,551 million in the previous year - indicating a robust growth of 18%. The growth was broad based across geographies as both Americas and Europe contributed in line with overall revenue growth. The Company also saw healthy growth across business segments in CME and Enterprise verticals.

The EBITDA on consolidated basis for the Financial Year 2022 was '' 80,200 million, a growth of 17% over the previous year EBITDA of '' 68,470 million. The resultant EBITDA margins were in a similar range - 18% in FY 2022 as against 18.1% in FY 2021. The post-tax profit of the Company increased by 25.7% to '' 55,661 million in FY 2022 as against '' 44,280 million in FY 2021.

The Company saw robust demand for digital transformation services with focus on customer experience and cloud. The Company has seen new deal wins of over USD 3,000 million in the previous year indicating a healthy growth momentum across all business verticals. Your Company’s investments in Enterprise SaaS and Hi-tech capabilities will help it cater to increasing modernization demands from businesses in Financial Year 2023 and beyond.

ACQUISITIONS

Your company made the following acquisitions during the financial year 2021-22.

DIGITALONUS

The Company on May 7, 2021, acquired 100% of the share capital of DigitalOnUs Inc. through its wholly owned subsidiary company Tech Mahindra (Americas) Inc. at a consideration of USD 120 million including earnouts and retention bonus. The company is headquartered in California, USA and is focused on Cloud Native Development and Hybrid Cloud Automation Services. This acquisition helped your Company in enhancing capability in Cloud Native Engineering and positioned the Company to develop cutting-edge digital solutions for its customers.

EVENTUS SOLUTIONS GROUP

The Company on June 18, 2021, acquired 100% of the share capital of Eventus Solutions Group, LLC (Eventus) through its wholly owned subsidiary company Tech Mahindra (Americas) Inc. at a consideration of USD 44 million including earnouts. Eventus is headquartered in Denver, Colorado, USA and has strong consulting capability in customer experience (CX) and customer management and enabled your Company to build an industry leading consulting practice in BPS business.

BERIS CONSULTING GMBH

The Company on October 1, 2021, acquired 100% of the share capital of Beris Consulting GmbH (Beris) through its subsidiary Company Tech Mahindra GmbH at a consideration of EUR 7 million including earnouts. Beris has 125 employees and helps your Company to unlock the transformational growth in the IT and application space for the automotive industry as a result of industry trends such as EV, Sharing & Mobility. It will also help your Company to expand its presence, hone local expertise and client relationships in the German market.

INFOSTAR LLC

The Company acquired 100% of the share capital of Infostar LLC (Lodestone) through its wholly owned subsidiary company Tech Mahindra (Americas) Inc. on October 25, 2021 at a consideration of USD 105 million including earnouts. Lodestone is headquartered in California, USA and helps your company to bolster end to end digital product engineering capabilities across design, build and test by employing Lodestone’s expertise in data strategy and providing end to end product quality assurance across hardware, software and data layers.

WE MAKE WEBSITES

The Company acquired 100% of the share capital of We Make Websites, UK through its step-down

subsidiary company Born London Limited, UK on October 25, 2021 at a consideration of GBP 9.4 million. The company is headquartered in UK and its offerings include Custom Shopify App Development, focused Ecommerce Agency, Design & UX, re-platforming, SEO & Data Migration, Headless Commerce, CRO, Performance Enhancement, Payments & Checkout, Compliance, Accessibility and O2O strategy.

BRAINSCALE

The Company on November 17, 2021, acquired 100% of the equity shares in Brainscale Inc. (Brainscale) through its wholly owned subsidiary company Tech Mahindra (Americas) Inc. at a consideration of USD 28.8 million including earnouts. Brainscale has expertise in Cloud consulting, Cloud enablement, Application Development and Data Analytics, which will bolster your company’s consulting capabilities in the Cloud transformation space and will enable your Company to drive growth of Cloud related IT services.

ACTIVUS

The Company on December 3, 2021, acquired 100% of the equity shares in Activus Connect LLC and Activus Connect PR LLC (together called as Activus) through its wholly owned subsidiary company Tech Mahindra (Americas) Inc. at a consideration of USD 62 million including earnouts. Activus is headquartered in Florida USA and has 1750 employees and is in the business of remote customer experience and customer care solution. This acquisition will help improve your company’s capability in the work from home Customer Experience Management by employing unique delivery model and disruptive platform called Smart Virtual.

ALLYIS

The Company on December 31, 2021, acquired 100% of the equity shares in Green Investments LLC (Allyis) through its wholly owned subsidiary company Tech Mahindra (Americas) Inc. at a consideration of USD 122.4 million including retention bonus and earnouts. Allyis is headquartered in Seattle, USA and has presence in US, Romania, Costa-Rica and India. The Indian subsidiary was acquired by Tech Mahindra Limited, at a consideration of USD 2.6 million. Allyis offers Technology consulting and managed services that help Organizations to reduce costs, improve performance which would help your Company’s capabilities in digital experience solutions and engineering, cloud and automation, BI and Analytics and Technical Support services.

CTC

The Company on January 17, 2022, acquired 100% of the equity shares in Com Tech Co IT Limited (CTC) through its wholly owned subsidiary company Tech Mahindra London Limited at a consideration of EUR 310 million including earnouts. CTC has 720 employees and is a specialized digital engineering and outsourced product development organization with development centers in Latvia and Belarus. It offers high-end-digital engineering services to some of the largest insurance and reinsurance organisations globally. Your Company also acquired 25% equity shares each in SWFT Technologies and Surance Ltd which are early stage InsurTech SaaS ventures with a proven technology.

GEOMATIC.AI

The Company acquired 80% of the share capital of Geomatic.AI Pty Ltd, Australia through its wholly owned subsidiary company Tech Mahindra (Singapore) Pte. Ltd on February 15, 2022 at a consideration of A$6 million. Geomatic.AI is headquartered in Australia and its offerings include digital platforms led nonlinear growth in partnership with AusNet Services an Australian Energy & Utilities distributor and will build digital twins for linear assets leveraging Cloud, Drone and Mobility technologies in the Geospatial domain.

DETAILS OF SUBSIDIARIES / JOINT VENTURES / ASSOCIATE COMPANIES

The performance and financial position of the subsidiaries, associate and joint venture companies included in the consolidated financial statement is provided in accordance with the provisions of Section 129 read with Rule 5 of the Companies (Accounts) Rules, 2014 containing the salient features of the financial statement of the Company’s subsidiaries/joint ventures or associate companies in Form AOC - 1 in "Annexure I” to this report.

Pursuant to Rule 8(5)(iv) of the Companies (Accounts) Rules, 2014, the names of the companies which have been incorporated or ceased to be the subsidiaries, joint ventures or associate companies during the year are provided in "Annexure II” to this report. The Company is actively pursuing the initiative on the consolidation of its subsidiaries/branches to optimize the operational costs. During the year under review, your Company has closed/merged fourteen subsidiaries.

In terms of the provisions of Regulation 24 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations 2015, Tech Mahindra (Americas) Inc. is a wholly owned unlisted material subsidiary of the Company.

The policy for determining material subsidiaries formulated by the Board of Directors is disclosed on the website of the Company and can be accessed at https://insights.techmahindra.com/investors/Policy-For-Determining-Material-Subsidiaries.pdf

UPDATE ON MERGER

The Board of Directors at its meeting held on January 31, 2021 approved the Scheme of Merger of Tech Mahindra Business Services Ltd and Born Commerce Private Ltd with the Company. Accordingly, the companies filed the petitions before the Hon’ble National Company Law Tribunal (NCLT), Mumbai and Chennai Benches respectively. The petitions are pending for final hearing as on the date of this Report.

HUMAN RESOURCES

The employees of the Company are the most critical asset to your Company. The Company has taken several steps to protect, retain, and improve the competencies of these assets including:

Hiring: War for Talent

Your Company responded to the ‘Great Resignation’ by adopting many innovative practices such as remote hiring, hybrid working, productivity to the engagement of remote workforce. With no location constraints, your Company could hire diverse talent including stay-at-home women, retired professionals, Persons with Disabilities (PwDs), gig workers, and more. Through the NXT.Town program, your Company started small centres in Tier-II and Tier-III cities across India to proactively look beyond set boundaries and focus on skill-based hiring in emerging technologies. Your Company is also committed to diversifying talent hiring at global delivery centres to improve local customer connect. Your Company has restructured its referral and campus recruitment programs to actively encourage hiring at the ‘bottom of the pyramid’. The Digital RMG platform has helped your Company proactively hire based on forecasted demand through a custom-built applicant tracking system that allows collaborative hiring and improves the candidate experience.

Learning: Build v/s Buy Talent

At your Company, learning plays a strategic role in the achievement of business goals by facilitating upskilling and creating a future-ready workforce, all the while fulfilling its associates’ career aspirations. In order to enable end-to-end digital transformation for global customers, your Company is building skills and keeping its talent pool brimming with new-age technologies. By offering skill-based and accelerated career movement allowance through the Career Acceleration Policy, your Company is encouraging niche skilling, thus creating a win-win situation. Your Company has launched a Cloud Finishing School for creating project-ready talent in Cloud technologies to fulfil business needs. After the success of the EMBARK capability building program for Program Managers, your Company has started an Architect COE for solution and technical architects who work on digital transformation. In an effort to build a roster of young and diverse leadership, the Company has launched focused young leader and women leader programs, with an emphasis on deploying them into new roles once their learning journey is complete. The Company has also partnered with Harvard to offer bite-sized learning content via the Harvard Manager Mentor (HMM) SPARK platform. Your Company continues to leverage its #NAD Learn platform to create full-stack professionals through initiatives like fresher-skilling, project-skilling, future-skilling and bench-skilling (Competence to Deployment) to create future-ready talent, in line with its NXT.NOW philosophy.

Leadership: Extreme Ownership

The natural culture of empowerment at your Company was supercharged during the pandemic as associates took ownership for their deliverables and leaders at all levels were an integral part of the decision-making process. The Leadership team of the Company aims to imbibe the following atomic habits -alternate thinking, bias for action, closure over followup, data over emotions and extreme ownership. This was reinforced through the adoption of a real-time Performance Management Dashboard for the 300 talent-to-value business leaders whose continuous executive coaching and performance management was instrumental in your Company meeting its financial and strategic goals. Apart from coaching, the Leaders at the Company have also had the opportunity to experience new forms of learning with technology-enabled pedagogies like habit builders, qubit

thinking, cinema-based learning, gamification etc. The Company also launched the Leadership Retreat, an eight-day-long learn-as-you-work residential program to replenish the physical, emotional, cognitive, and social energies of mid and senior level leaders.

Performance: Outcome-Driven

Your Company launched the Annual Performance Feedback cycle in December 2021 and has completed its performance appraisal. Aspiring to build a culture where performance is enabled through feedback, managers have been trained to engage in better performance review dialogues with their direct reports and work on an outcome-based evaluation, rather than process or effort measurement. Your Company is creating a high-performance culture through hyper-personalized incentive plans. Your Company has a suite of incentive plans that are designed to create a strong alignment between individual wealth creation and organizational performance. In addition to broad-based incentive plans, your Company has also customized quarterly sprint incentives which create avenues for instant gratification for associates across the front, middle, back offices as well as enabling functions, thereby inculcating a spirit of collaboration. With platforms like Talex, #NAD Learn and a revamped job rotations policy, your Company continued to improve internal mobility.

Wellness: Holistic Wellbeing

The ‘Wellness Before Business’ mantra followed by your Company has ensured the collective well-being and safety of its entire ecosystem of stakeholders, including associates, customers, and partners. The Wealth of Wellness (WoW) program ensures preventive, personalized, and proactive holistic wellness across all 8 dimensions of wellness including physical, mental, emotional, and financial parameters. The Company has launched new policies like the Bereavement Support for Dependents (COVID Support) Policy, Sabbatical Leave Policy, and more in response to the unique challenges posed by the pandemic. Your Company also provided financial security and crucial support through the Associate Welfare Trust for 190 associates, disbursing '' 2.8 crores. To highlight the importance of physical well-being, your Company launched the Wellness 101 Challenge as well as the Run Anywhere virtual marathon to engage its associates who predominantly worked from home and encouraged them to reclaim their fitness. Mental well-being was prioritized through initiatives like the Mind Plan, People Care Manager Program and the Emotional Wellness Self-Assessment.

Pandemic: #ResolveToRise

#ResolveToRise was an organization-wide campaign by the Company, rallying associates to embrace the Rise credo and encouraging them to stay strong by sharing inspiring stories and initiatives from the ground, including COVID warriors assisting those in need, Company-led innovations using #TechForGood to help the most vulnerable, community-wide volunteering efforts, and more. During the pandemic, the Company also setup a COVID-19 Support Fund, providing much-needed relief to affected families, setting up oxygen plants and donating ambulances to charitable hospitals. Your Company also setup COVID care centres at five major locations to help both associates and the larger community. Through the SOS Seva, your Company helped patients access critical care including hospital beds, oxygen cylinders, oxygen concentrators, medicines, and plasma. Through a series of vaccination drives, your Company has encouraged protection and prevention, vaccinating associates, their family members, and other third-party staff.

Communication: Building Purpose

Through effective internal communications, your Company ensures that the connected purpose of the organisation is communicated to all associates, thus reiterating the core philosophy of the brand: creating a connected world with connected experiences. With hybrid working being the norm, your Company has made virtual connectedness a way of life through various digital initiatives that were purpose-led, peoplecentric, and performance-driven. Multiple mediums were used to reach out to associates including social media, e-chats, emailers, campaigns, screensavers and more. With a 360-degree-communication approach, your Company has built a culture that is based on celebration, positive change, and the credo of Rise which has resulted in a unifying pride for the Company - their #LoveToBeTechM.

Diversity: Being Yourself

Your Company considers ‘diversity of people’, ensuring ‘equitable opportunities’ and ‘inclusion at the workplace’ as an instrument of growth. This has reflected in the definition of the new vision statement of your Company. The earlier Vision 2021 was about fostering innovation and that comes from ‘diversity of thought’. The new Vision 2024 is about creating a purpose-led company. Your Company is committed to pursuing ‘Purpose beyond Profits’ by embedding Environmental, Social and Governance

Engagement: TechM CARES Survey

Your Company has taken active steps to build remote engagement by creating virtual ‘water-cooler’ moments and updating policies in line with the ‘new normal’. To ensure that associates were continuously engaged through the right channels and received the right information at the right time, your Company followed the 4C model - Connect, Collaborate, Career, and Celebrate. Associates have expressed their confidence and delight through the TechM CARES survey where your Company has secured an overall rating of 4.58/5 - the highest score in its history. This engagement score represents a 54 basis points increase over the last survey score of 4.04/5 and reinforces your Company’s commitment to create human-centered experiences for its associates.

QUALITY

The Company continues its focus on quality and strives to exceed customer expectations at all times. During the year, it continued to strengthen the implementation of Quality systems and upgraded various processes to comply with CMMI V 2.0 for both Dev and Services. The Organization is recently assessed at Level 5 maturity. Similarly it underwent various upgrade and re-certification audits for multiple standards during the year in order to meet client demands and enhance value delivery. The Company has Successfully re-certified, ISO 9001:2015 (Quality Management System), ISO 20000-1:2018 (Information Technology Service Management System), ISO 27001:2013 (Information Security Management System), ISO 27701:2019 (Privacy Information Management System), TL9000 R 6.2/ R5.7 (Quality Management Systems for Tele Communications industry), ISO 13485:2016 (Quality Management Systems for medical devices - scope of certification limited to medical devices business within Tech Mahindra), AS9100 Rev D (Standard for Aerospace domain - scope of certification limited to the aerospace business within Tech Mahindra), ISO 17025:2017 - Laboratory Quality Management Systems for device testing labs.

In addition to these, your Company also maintains its commitment to health, safety and environment by continually improving its processes in accordance with ISO 14001:2015 (Environmental Management System) and ISO 45001: 2018 (Occupational Health and Safety Assessment Series) standards. Your Company is also certified on ISO 22301:2012 (Societal Security and

(ESG) principles into its core strategy, thus creating a long-term positive impact on the planet and society while providing greater value for all its stakeholders. Improvements in Diversity, Equity and Inclusion practices is critical to improve the Social aspect of ESG, and hence your Company has defined a roadmap for improvements across the dimensions of Gender, Generation, People with Disabilities, the LGBTQ community as well as cultures and nationalities. This also links back to the stated objective of your Company to be human-centered by encouraging associates to bring their most authentic selves to work.

Recognition: People at the Core

While timely recognition is key to a happy workforce, your Company also prioritizes creating a culture of appreciation. Your Company’s robust digital platform ensures both recognition and appreciation with monetary and non-monetary rewards badges linked to redemption points. Your Company also encourages its associates to donate their reward points towards social causes and has an industryleading rewards penetration of approximately 40%. To celebrate achievements in the virtual world, your Company introduced the quarterly Spotlight awards and other timely sales- focused awards to reward growth, collaboration, and high-impact initiatives. Your Company also included associates’ family members to virtually felicitate both Long Service Awardees and ACERs (consistent performers for two years) for their outstanding contributions and commitment.

HR Digitization: Automation at every Step

Your Company has continued to invest in its flagship product, ‘Dove,’ for new joiners, enabling new capabilities for document submissions and personal information updates. Your Company has continued to enhance self-service capabilities for existing associates in diverse areas such as letter generation, work permits, automated approvals, and proactive notifications for key events. Your Company has adopted Office 365 as well as the Enate and UNO platforms to automate routine business transactions through BOTs. Your Company has also taken steps to improve the post-joining and pre-exit processes to improve communication as a step towards empowering associates with the right information. Your Company has also leveraged Artificial Intelligence/ Machine learning to build internal applications to provide associates with customer-like experiences.

Business Continuity Management System) and has a comprehensive Business Continuity and Disaster Recovery framework, to prevent potential business disruptions in the event of any disaster. The Company has processes that helped resume services to customer’s acceptable service levels. Automated Service Desk with SLAs for enabling business and Vulnerability Assessment and Penetration Testing Lab for secured corporate network operations are highlights that showcase the information security posture of the Organization.

During the second year of the pandemic, the entire quality management system was put to test with majority of the associates working from home. Complying with the Company’s security requirements, they were able to deliver services as per contractual commitments, leading to great customer satisfaction.

Tech Mahindra (IT Division) has been assessed for the implementation of high maturity business excellence practices at Mahindra Group (Services Sector). It has been assessed at TMW Maturity Stage 7 (on scale of 1-10 stages) of Mahindra Business Excellence Framework - The Mahindra Way. These certifications are testimony of the robustness of business processes and at large the quality culture imbibed in the organization.

Your Company has continued to strengthen the process for transforming Quality Assurance processes & delivery methods to adopt and strengthen Delivery excellence, Risk governance, and further enhance automation to enable quality delivery to the customer. Quality index which is a measure of quality of products and services delivery is institutionalized.

All these actions are being taken to ensure that the Company deliver as stated in its Quality Policy.

DIRECTORS

During the year under review, all Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Independent Directors have also given declaration of compliance with Rules 6(1) and 6(2) of the Companies (Appointment and Qualification of Directors) Rules, 2014, with respect to

their name appearing in the data bank of Independent Directors maintained by the Indian Institute of Corporate Affairs.

Pursuant to the provisions of Section 152(6)(c) of the Companies Act, 2013, Mr. C. P. Gurnani, Managing Director & CEO (DIN: 00018234) is liable to retire by rotation and offers himself for reappointment.

Further the term of Mr. C. P. Gurnani as Managing Director & CEO expires on August 9, 2022. The Board of Directors based on the recommendation of Nomination and Remuneration Committee considering the performance of the Managing Director & CEO over the last 10 years & his contribution to the growth of the Company approved and recommends the re-appointment of Mr. C. P. Gurnani as Managing Director & CEO for another term from August 10, 2022 upto December 19, 2023, which is his date of retirement from the Company, subject to the approval of shareholders at the ensuing Annual General Meeting.

Your Directors co-opted Ms. Penelope Fowler (DIN: 09591815) as an Additional Director with effect from May 13, 2022. The term of Ms. Fowler will end at the ensuing Annual General Meeting. As Ms. Penelope Fowler meets the criteria of an Independent Director, the Board recommends her appointment as an Independent Director for a period of 5 years for the approval of shareholders at the ensuing Annual General Meeting.

Mr. M. Damodaran (DIN: 00125299) has retired as an Independent Director of the Company with effect from March 31, 2022. Your Board places on record its sincere appreciation for the valuable contribution and timely guidance from Mr. M. Damodaran to the Company during his tenure.

In terms of Regulation 24(1) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations 2015, Mr. T. N. Manoharan, Lead Independent Director of the Company has been appointed as Director on the Board of Tech Mahindra (Americas) Inc., a wholly owned unlisted material subsidiary of the Company with effect from May 21, 2019.

In the opinion of the Board of Directors the Independent Directors have relevant proficiency, expertise and experience.

i. Policy on the appointment and removal of Directors, Key Managerial Personnel and Senior Management.

ii. Policy on remuneration to the Directors, Key Managerial Personnel and Senior Management and other Employees.

The extract of these two policies is provided in "Annexure III''

The policies are available on the website of the Company and can be accessed at https://insights. techmahindra.com/investors/Governance-Policies-including-remuneration-to-Directors-KMPS.pdf

SUCCESSION PLAN

In accordance with the principles of transparency and consistency, your Company has adopted governance policies for appointments, remuneration and evaluation of its Board of Directors, Key Managerial Personnel & Senior Management. In line with these Governance policies, the Company has established a formal Succession Planning Program for key managerial persons across the organization. The Board evaluates all such plans at a regular interval and institutes a formal program for filling any such critical position. The Board evaluates both internal and external candidates for such positions alongwith the recommendations of the Company. The Company also has a leadership development program where it identifies high potential managers, and trains them to take up the positions of higher responsibility. The Company has identified the second line of leadership, which provides stability to the business in any contingencies.

TRAINING

The Company has laid down a policy on the training of Independent Directors as part of its governance policies. The Senior Leadership of the Company periodically updates the Directors on regulatory changes, business strategy and the Company has laid down a policy on the training of Independent Directors as part of its governance policies. The Senior Leadership of the Company periodically updates the Directors on regulatory changes, business strategy and operations.

KEY MANAGERIAL PERSONNEL (KMP) Pursuant to provisions of Section 203 of the Companies Act, 2013, Mr. C. P Gurnani, Managing Director & Chief Executive Officer, Mr. Manoj Bhat, Chief Financial Officer (up to April 1, 2021), Mr. Milind Kulkarni,


FAMILIARISATION PROGRAMME

These programmes aim to provide insights into the Company to enable the Independent Directors to understand its business in depth and contribute significantly to the Company. The details of program for familiarisation of the Independent Directors with the Company are available on its website and can be accessed at https://insights.techmahindra.com/ investorsltml-familarisation-progarmmes-for-IDs.pdf

The Board members are also regularly updated on changes in statutory provisions like changes in Corporate Laws, SEBI Regulations, Taxation Laws and People related laws as applicable at the quarterly Board meetings. The Board members are also updated on the Risk universe applicable to the Company’s business. The MD & CEO of the Company had quarterly sessions with Board members sharing updates about the Company’s business strategy, operations and the key trends in the IT industry that are relevant to the Company. These updates help the Board members in keeping abreast of key changes and their impact on the Company.

BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and Regulation 19 read with Schedule II, Part D of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has devised a policy on evaluating the performance of the Board of Directors, the Chairman, Committees, and Individual Directors. The evaluation process was carried out through a web-based portal. The summary of the evaluation reports was presented to the respective Committees and the Board. The Directors had given a positive feedback on the overall functioning of the Committees and the Board. The suggestions made by the Directors in the evaluation process have been suitably incorporated in the processes.

NUMBER OF MEETINGS OF THE BOARD

The Board met four times during the Financial Year 2021-22. The meeting details are provided in Corporate Governance report that forms part of this Annual Report. The maximum interval between any two meetings did not exceed 120 days as prescribed in the Companies Act, 2013 and SEBI Listing Regulations.

POLICY ON DIRECTORS’ APPOINTMENT AND REMUNERATION

The Governance policies laid down by the Board of Directors of your Company include:

are adequate for ensuring the orderly and efficient conduct of the business, including adherence to the Company’s policies, the safe guarding of assets, the prevention and detection of frauds and errors, the accuracy and completeness of accounting records and timely preparation of reliable financial information.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS / PROCEEDINGS

There are no significant and material orders passed by the regulators or courts or tribunal impacting the going concern status and the Company’s operations in the future.

Further no application against the Company has been filed or is pending under the Insolvency and Bankruptcy Code, 2016, nor the Company has done any one time settlement with any Bank or Financial institutions.

STATUTORY AUDITORS

The members, in the 30th Annual General Meeting (AGM) held on August 1, 2017, appointed

M/s. B S R & Co. LLP, Chartered Accountants, [ICAI Firm’s Registration No. 101248W/W- 100022] as the Statutory Auditors of the Company, to hold office for a term of five years from the conclusion of the 30th AGM of the Company held in the Financial Year 2017-18 until the conclusion of the AGM of the Company for the Financial Year 2021- 22 on such remuneration as may be determined by the Board of Directors.

Pursuant to Section 139 of the Companies Act, 2013 the Statutory Auditors M/s. B S R & Co. LLP, Chartered Accountants have confirmed that they are eligible to continue as auditors.

In accordance with provision of Section 139 of the Companies Act, 2013 read with Rules framed thereunder, the Board of Directors of the Company on the recommendation of the Audit Committee, proposes appointment of M/s. B SR & Co. LLP, Chartered Accountants (ICAI Firm’s Registration No. 101248W/W - 100022) as Statutory Auditors of the Company to hold office from the conclusion of ensuing 35th AGM for a term of five consecutive years till the conclusion of 40th AGM. The appointment of M/s. B S R & Co. LLP as the statutory auditors of the Company is placed before the members for approval at the ensuing AGM.

As required under provision of Section 139(1) of the Companies Act, 2013 the Company has received a written consent from M/s. B S R & Co. LLP for their

Chief Financial Officer (w.e.f. April 2, 2021) and Mr. Anil Khatri, Company Secretary & Compliance Officer were the Key Managerial Personnel of the Company during the year under review. Mr. Milind Kulkarni will retire as Chief Financial Officer of the Company w.e.f. May 31, 2022 and Mr. Rohit Anand was appointed as Chief Financial Officer of the Company w.e.f. June 1, 2022.

DIRECTORS’ RESPONSIBILITY STATEMENT

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

i. in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

ii. they have, in the selection of the accounting policies, consulted the Statutory Auditors and these have been applied consistently and, reasonable and prudent judgments and estimates have been made so as to give a true and fair view of the state of affairs of the Company as at March 31, 2022 and of the profit of the Company for the year ended on that date;

iii. proper and sufficient care had been taken 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 other irregularities;

iv. the annual accounts have been prepared on a going concern basis;

v. they had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively;

vi. the proper systems to ensure compliance with the provisions of all applicable laws are in place and are adequate and operating effectively.

DETAILS WITH RESPECT TO ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS

The Company has internal financial controls which are adequate and were operating effectively. The controls appointment and a certificate to the effect that their appointment, if made, would be in accordance with the Companies Act, 2013 and the Rules framed thereunder and that they satisfy the criteria provided in Section 141 of the Companies Act, 2013 read with Rule 4(1) of the Companies (Audit and Auditors) Rules, 2014 and that they are not disqualified for appointment as statutory auditors of the Company.

There are no qualifications, reservations, adverse remarks or disclaimer made in the audit report for the Financial Year 2021-22.

SECRETARIAL AUDIT REPORT

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 had appointed Mr. Makarand Lele & Co., Practicing Company Secretary, Pune to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is available at ‘Annexure IV” to this report. There are no qualifications, reservations, adverse remarks or disclaimer made in the Secretarial Audit Report.

COMPLIANCE WITH SECRETARIAL STANDARDS

The Company has complied with the applicable Secretarial Standards.

ANNUAL RETURN

Pursuant to the provisions of Section 92(3) read with Section 134(3) (a) of the Companies Act, 2013, the Annual Return in Form MGT-7 is available on the website of the Company and can be accessed at https://insights.techmahindra.com/investors/mgt7-annual-return-2021-22.pdf

MANAGERIAL REMUNERATION

Disclosures of the ratio of the remuneration of each director to the median employee’s remuneration and other details as required pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended from time to time, are provided as "Annexure V”.

None of the directors or Managing Director & CEO of the Company, received any remuneration or commission from Subsidiary Companies of your Company.

The details of remuneration paid to the Directors including the Managing Director & CEO of the Company is provided in Corporate Governance Report.

PARTICULARS OF EMPLOYEES

The information required under Section 197(12) of the Companies Act, 2013 ("the Act”) read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms part of this Report. However, pursuant to first proviso to Section 136(1) of the Act, this Report is being sent to the Shareholders excluding the aforesaid information. Any shareholder interested in obtaining said information, may write to the Company Secretary at the Registered Office / Corporate Office of the Company and the said information is open for inspection at the Registered Office of the Company.

POLICY ON PREVENTION OF SEXUAL HARASSMENT

Your Company laid down the Prevention of Sexual Harassment (POSH) policy which is available on its website. The Company has zero tolerance on Sexual Harassment at workplace. During the year under review there were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

The status of complaints received under POSH and redressed by the POSH Committee of the Company, during the Financial Year under review, are given below:

a) Number of complaints received - 45

b) Number of complaints redressed - 43

c) Number of complaints pending - 2

There are focused campaigns on the POSH policy within the Company and awareness drives that take place with the help of its BPS teams. Furthermore, the employees are required to undertake a mandatory annual certification on POSH to sensitize themselves and strengthen their awareness.

EMPLOYEE STOCK OPTION SCHEMES

During the year under review, there were no material changes in the Employee Stock Option Schemes (ESOPs) of the Company and the Schemes are in compliance with the SEBI Regulations on ESOPs.

As per Regulation 14 of Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021, the details of the ESOPs are uploaded on the website of the Company and can be accessed at https://insights.techmahindra. com/investors/Details-of-ESOPs-FY-2021-22.pdf

CORPORATE GOVERNANCE

A report on Corporate Governance covering among others composition, details of meetings of the Board and Committees along with a certificate for compliance with the conditions of Corporate Governance in accordance with the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, issued by the Statutory Auditors of the Company, forms part of this Annual Report.

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.

COST RECORDS

Maintenance of cost records and requirement of cost audit as prescribed under the provisions of Section 148(1) of the Companies Act, 2013 are not applicable for the business activities of the Company.

RISK MANAGEMENT

The Risk Management Committee of the Board of Directors guides the operating management to identify risks, analyze their probability and impact and prepare mitigation plans. It periodically reviews the Risk Management Framework & Enterprise Risk Register which is presented by the Chief Risk Officer. The Company identifies all potential risks viz. economical, business, currency, operational, climate, governance, financial, cyber, business continuity etc. and prepares a mitigation plan for each of the risks. The elements of risk as identified by the Company with the impact and mitigation strategy are set out in the Management Discussion and Analysis Report (MDA).

ESTABLISHMENT OF VIGIL MECHANISM

The Company has laid down Whistle Blower Policy covering Vigil Mechanism with protective Clauses for the Whistle Blowers. The Whistle Blower Policy is made available on the website of the Company.

DEPOSITS / LOANS & ADVANCES, GUARANTEES OR INVESTMENTS

The Company has not accepted any deposits from the public during the year under review. The particulars of loans/advances, guarantees and investments under Section 186 of the Companies Act, 2013 are given in the notes forming part of the Financial Statements.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All transactions entered into with Related Parties as defined under Section 2(76) of the Companies Act, 2013 and Regulation 23 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, ("The Listing Regulations”), during the Financial Year under review were in the ordinary course of business and at an arm’s length pricing basis and do not attract the provisions of Section 188 of the Companies Act, 2013. There were no transactions with related parties in the Financial Year which were in conflict with the interest of the Company and requiring compliance of the provisions of Regulation 23 of the Listing Regulations.

Suitable disclosure as required by the Indian Accounting Standards (Ind AS 24) has been made in the notes forming part of the Financial Statements.

The Company has formulated a policy on the materiality of Related Party Transactions and dealing with Related Party Transactions which has been uploaded on the website of the Company and can be accessed at https://insights.techmahindra.com/investors/Related-Party-Transactions-Policy.pdf

The particulars of related party transactions in prescribed Form AOC - 2 are attached

as ‘Annexure VI”.

Pursuant to Regulation 23(9) of the Listing Regulations, your Company has filed half yearly report on Related Party Transactions with the stock exchanges.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars as prescribed under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 are provided in “Annexure VII” which forms part of this report.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

The CSR vision of the Company is "Empowerment through Education.”

In compliance with the guidelines prescribed under Section 135 of the Companies Act, 2013, your Company has constituted a Corporate Social Responsibility (CSR) Committee of the Board. The CSR policy, covering the Objectives, Focus Areas, Governance Structure Monitoring and Reporting Framework among others is approved by the Board of Directors. In accordance with the amendments made in Section 135 in January 2021, the CSR Policy has been duly revised and is available on the website of the Company and can be accessed at https://files. techmahindra.com/static/img/pdf/csr-policy-techm-v3-march2021.pdf

The Company has spent more than 2% of the average net profits of the Company during the three immediately preceding Financial Years on CSR.

The Company’s social initiatives are mainly carried out by Tech Mahindra Foundation and Mahindra Educational Institutions, Section 8 (erstwhile Section 25) Companies promoted by the Company.

TECH MAHINDRA FOUNDATION (TMF) EDUCATION

The key initiatives taken by TMF in the arena of school education include:

ALL ROUND IMPROVEMENT IN SCHOOL EDUCATION (ARISE)

Tech Mahindra Foundation’s educational initiatives under ARISE are long-term school improvement programmes, in partnership with local governments and partner organisations. The Foundation in 2021-22 worked with 18 government primary schools to transform them into model schools of excellence. A total of 4,928 students were positively impacted under this programme, of which 2,646 were girls.

During the year, the Foundation expanded its work for children with special needs through its ARISE programme. This programme is a variant of ARISE in which children with special needs are provided chronic therapy as well as special education to help them lead more fulfilling lives. Through 28 projects, the programme enabled 3,792 children with special needs to become better learners with greater independence in managing their lives. The Foundation is also working

with some of the most committed NGOs in the disability sector to positively impact even more children.

SHIKSHAANTAR

Shikshaantar, envisioned as a programme for enhancing capacity of government school teachers, has emerged as an important programme in the education portfolio of the Foundation. TMF works with the Municipal Corporations in East Delhi and North Delhi by running their In-Service Teacher Education Institutes and during the year under review, as many as 9,573 teachers were trained as part of this initiative. This included specially designed modules for Digital Literacy, Child Safety, Cyber Security and Mental Health that were delivered to the teachers through online sessions. Physical training sessions with teachers resumed in the last few months of the year.

MOBILE SCIENCE LAB

In order to increase the footprint of its work in Education and reach the unreached, TMF had launched a unique initiative in 2019-20. The Mobile Science Lab (MSL). For this, a Mahindra bus has been remodeled to become a science lab on wheels and has been travelling from school to school in East Delhi to provide STEM learning for children in grades 3 and 4 in these schools. The MSL program resumed its operations in 2021-22 after a break of over a year, and during the year, as many as 4,590 students and 99 teachers were benefitted.

EMPLOYABILITY

Skills-for-Market Training (SMART) is the Foundation’s flagship programme in employability. It is built on the vision of an educated, enabled and empowered India, and the belief that educated and skilled youth are the country’s true strength. The programme started with 3 Centres in 2012 and is currently running over 85 Centres at 11 locations across India. These include SMART Centres, SMART Centres (training for people with disabilities), and SMART-T Centres (training in technical trades).

In 2021-22, your Company trained 16,715 young women and men under its SMART program, of which, 1,529 were persons with disabilities. More than 70% of the graduates are placed in jobs across multiple industries upon successful completion of the training. The average salaries being earned by the graduates of the SMART program have been steadily rising and crossed the '' 12,000 per month mark for the first time.

The Foundation’s commitment to setting new benchmarks in skill development in India has been underscored by the setting up of Tech Mahindra SMART Academies, which provide the highest quality of skill training to youngsters in Healthcare and Digital Technologies. During FY 2021-22, 1,677 students were trained at the eight Academies that are now functional - 4 in Healthcare, 3 in Digital Technologies, and 1 in Logistics.

TMF’S WORK IN COVID RELIEF

As FY 2021-22 began, the country was swept by a severe second wave of COVID-19, devastating large sections of the population. Continuing the COVID relief operations of the previous year, Tech Mahindra Foundation reached out to some of the most marginalized and vulnerable communities

- distributing ration kits, cooked meals, medical equipment, masks and PPE kits. More significantly, the Foundation managed to donate 20 fully equipped ambulances and install 10 oxygen plants at various charitable hospitals. In all, the COVID relief efforts of the Foundation have impacted over 2.3 million lives in 17 States of India through a wide range of initiatives.

MAHINDRA EDUCATIONAL INSTITUTIONS (MEI)

MEI - a not-for-profit, 100% subsidiary of the Company has set up Mahindra Ecole Centrale in August 2014

- through a collaborative venture between Mahindra Educational Institutions and Ecole Centrale of Paris, France (now known as Centrale Supelec) and the JNTU Hyderabad - to offer undergraduate engineering programs. Through this strong Indo-French Collaboration with Centrale Supelec and Industry connect with Tech Mahindra, MEC has emerged as a disruptive player in the field of Technical Education.

MEI has sponsored the setting up of Mahindra University to introduce diverse streams of education in addition to Engineering.

MAHINDRA UNIVERSITY (MU)

Mahindra University ("MU”) (sponsored by Mahindra Educational Institutions, ("MEI”) - a not-for-profit, 100% subsidiary of Tech Mahindra), was notified on May 20, 2020 by the Government of Telangana vide The Telangana State Private Universities (Establishment and Regulation) Act, 2018. for "educating future citizens for and of a better world”.

In 2021-22, Mahindra University launched 3 new schools besides the existing Ecole Centrale School

of Engineering— School of Management, School of Law and Indira Mahindra School of Education. Each of these Schools will run UG, PG and Ph.D. programs. Further, the University has subsequently planned to launch School of Media & Liberal Arts and School of Design in the next 2 years.

Cornell University’s SC Johnson College of Business, an ivy league institution is the "Academic Partner” for School of Management. Mahindra University’s School of Management (MU - SoM) will benefit significantly from Cornell University’s expertise in curriculum development, faculty exchange programs including some specialty courses delivery by the Cornell faculty to Mahindra University students, as well as student immersion at Cornell.

The School of Law, Mahindra University, commenced operations in September 2021 in Hyderabad and was founded on the philosophy of securing justice, equality, and service to all sections of society. With the needs of modern society evolving rapidly, there is a renewed focus on the importance of the discipline of law. The School of Law will aim to make a difference to the legal profession and practice by providing a diverse, flexible curriculum and pedagogy, touching on several aspects of domestic and international law, while appraising the students of the latest trends in academia and practice.

Indira Mahindra School of Education (IMSE) commenced its academic activities in 2021, with the PhD program. IMSE’s vision is to be a focused training ground for the next generation of teachers and school leaders through study of education where both researchers and practitioners are developed for working in and on educational issues.

In the academic year 2021, a total of 817 students were admitted to the University - of which 757 students were in various UG programs, including School of Management and School of Law, 24 students in the PG programs of School of Engineering and 36 students in the Ph.D programs across all the schools.

The Annual Report on CSR activities is provided as "Annexure VIII”.

SUSTAINABILITY

Climate change, escalation of wars and the pandemic have forced the world to look at Sustainability as the savior of our existence. The impact of the present crises can be handled better if a Sustainable

• Being Net Zero: Committed to be Net zero well before 2040 through adoption of renewable energy, increasing the use of energy-efficient equipment & tools across operations, creating eco-design of services, optimizing the use of resources across operations and preserving the biodiversity of areas in which we operate.

• Saying No to plastic: Maintaining plastic-free campuses and encouraging associates and stakeholders to use eco-friendly & biodegradable materials. Spreading awareness and initiating campaigns on preventing single-use plastic.

• Reduce, Reuse, Recycle, Recover: Implement process of Reduce, Reuse, Recycle and Recover across the value chain to limit waste and enable a circular economy.

• Sustainable supply chain: Ensure our suppliers follow the highest standards of sustainable and ethical best practices; optimise logistics and transportation to reduce emissions.

• Work-life balance: Provide an assured career development path and a feasible and flexi work-life balance to our associates along with a range of associate-friendly policies and processes to reduce attrition.

• Fostering Diversity: Offering improved opportunities and increasing the number of women, members of the LGBQ community, and PwDs to promote a diverse culture in the organization.

• Employee engagement and recognition:

Working diligently towards Employee engagement and increasing the number of employees recognized every year.

• Innovation: Becoming future-ready by proactively encouraging Innovative thinking across the organization, adopting technology disruption, and going digital to reduce emissions. Incorporating technologies such as loT, Blockchain, AI and Machine Learning to develop a portfolio of sustainable solutions that help reduce emissions and other negative impacts of climate change.

• Green solutions: Investing in Smart grid, Microgrid-As-A-Service, Community Action

business strategy is adopted by organizations globally. Sustainability must become an integral part of business strategy and management to ensure business continuity and profitable growth.

Being forerunners in the sustainability space, Tech Mahindra’s long-term growth strategy has always had ESG principles embedded in its core to help mitigate risks and drive profitable growth. Adopting proactive strategies that are resilient in nature has been the key to our continued success. Sustainable transformation with a focus on low carbon future has helped us to quickly adapt to disruptive changes and leverage these capabilities towards business continuity and management. Tech Mahindra’s sustainability commitments across environmental, social and governance pillars span across all our business verticals and even extends to our value chain. Being an organization with purpose, we have delivered on our promise to run better, change faster and grow greater while also creating meaningful human experiences for all.

Tech Mahindra is sourcing renewable energy, using energy-efficient equipment, and optimizing operations to achieve ecological balance while investing in and pioneering new solutions for sustainable development. Tech Mahindra’s emphasis on ESG is seen in our commitment of achieving Carbon Neutrality by 2030 and being Net zero well-before 2040. We are making optimum use of resources, moving towards low-emission technologies, and taking 5-year targets for ensuring diversity, equality, and innovation, while also updating policies and procedures to maintain a robust and compliant governance.

Tech Mahindra is aligned towards the UN SDGs (Sustainable Development Goals) and its sustainability focus areas are as below:

• Going Carbon Neutral: Increasing use of renewable energy through onsite installations and open access; improving energy efficiency through installation of LEDs, sensors; boosting green investments by implementing Carbon Price; optimizing business travel by enabling virtual meetings; encouraging use of public transport and carpooling to reduce commute emissions; planting trees to offset carbon footprints; moving towards a low carbon economy to ensure environmental protection.

Platform for Energy, Integrated Electric Vehicle Charging systems (IEVCS), Smart data hubs and Smart Cities for our Customers to reduce their emissions.

• Individual Social Responsibility: encouraging associates to make sustainability a part of their day-to-day lives.

• Transparency: Reporting our organizational policies & practices, along with financial, environmental and social data in the Integrated Annual Report.

The recognitions received by Tech Mahindra are a validation of the performance towards the company’s commitments, the details of the awards & recognitions are included in Corporate Overview, kindly refer page no. 25 of this Annual Report.

The Integrated Annual Report is based on various global standards and frameworks such as TCFD (Taskforce on Climate Related Financial Disclosures), CDSB (Climate Disclosure Standards Board), SASB (Sustainability Accounting Standard Board) and GRI standards and assured by third party according to ISAE (International Standard on Assurance Engagement) 3000 standards.

Tech Mahindra discloses climate-related risks and opportunities in line with the recommendations of TCFD which focusses on the financial impact of climate-related changes on our operations.

The TechM Board owns all risks and opportunities. The MD & CEO of the Company chairs the CSR Committee of the Board and has the ultimate responsibility for Sustainability. He is ably supported by the Senior Management members of the Sustainability Council and the Chief Sustainability Officer who manage all aspects of climate change.

The pandemic has taught the Company some concrete lessons and new ways of management in order to thrive in the new post-pandemic world. Tech Mahindra has made good progress on its commitments to provide for a better and more sustainable future by embedding sustainability into its business strategy and ensuring economic recovery and business profitability. The Company strategy includes futureproofing our growth against impending

changes in policies and regulations and increasing our compliance readiness. Your Company are agile and adaptive to dynamic changes in internal and external intricacies with strategies in place to manage all business and ESG risks in an effective way. With a robust business continuity management framework and incident response team, the Company have ensured that we are resilient to any ESG risks.

The targets and the metrics used for managing climate-related & other risks and the progress against these targets are disclosed in the externally assured Integrated reports available on the website of the Company and can be accessed at https://www. techmahindra.com/en-in/sustainability/.

AWARDS AND RECOGNITION

Your Company continued its quest for excellence in its chosen area of business to emerge as a true global brand. Several awards and rankings continue to endorse your Company as a thought leader in the industry. Few of the Awards / recognitions received by the Company during the year 2021-22 include:

• Tech Mahindra recognized among the Economic Times Iconic Brands 2021.

• Tech Mahindra was declared winner of

NASSCOM Engineering & Innovation Excellence Awards 2021 for Service Delivery Excellence & Next-Gen Products for our projects on Vehicle Top Hats & Distributed Ledger DnD.

• Tech Mahindra listed among 2021 Best

Workplaces in Asia by Great Place to Work®.

• Tech Mahindra received HRH, The Prince

of Wales’ Terra Carta Seal in Recognition of the Company’s Commitment to Creating a Sustainable Future.

• Tech Mahindra won 3 Golds at the prestigious 2021 Stevie Awards for Great Employers.

• Tech Mahindra Recognized as the Fastest

Growing Organization in ‘Brand Strength’ by Brand Finance.

• Tech Mahindra emerges as the only Indian

company in the Forbes’ Blockchain 50.

• Mr. C. P. Gurnani has been recognized by The Economic Times among ‘Most Inspiring Business Leaders of Asia’ at The Economic Times 6th Edition Asia’s Promising Business Leaders.

• Tech Mahindra Included in Bloomberg Gender-Equality Index for Third Consecutive Year.

• Tech Mahindra was recognized for its pathbreaking sustainable efforts and was ranked 2nd amongst the Top 35 companies in Business world India’s Most Sustainable Companies 2022.

These awards are a reflection of the Company’s continued efforts in the fields of business, sustainability, human resource management and its sustained progress towards creating a better society for all.

ACKNOWLEDGEMENTS

Your Directors place on record their appreciation for the contributions made by employees towards the success of your Company more particularly ensuring business as usual in spite of the impact of COVID-19. Your Directors gratefully acknowledge the cooperation and support received from the shareholders, customers, vendors, bankers, regulatory and Governmental authorities in India and abroad.

For and on behalf of the Board

Anand G. Mahindra Place: Mumbai Chairman

Date: May 13, 2022 (DIN: 00004695)


Mar 31, 2021

DIRECTORS’ REPORT

Your Directors present Thirty Fourth Annual Report together with the audited accounts of your Company for the year ended March 31, 2021.

FINANCIAL RESULTS (STANDALONE)

('' in Million)

For the year ended March 31

2021

2020

Income

305,627

315,916

Profit Before Interest, Depreciation and Tax

62,521

60,663

Interest

(632)

(667)

Depreciation

(6,623)

(6,674)

Profit Before Tax

55,266

53,322

Provision for Taxation

(12,875)

(7,977)

Profit After Tax

42,391

45,345

Other Comprehensive Income

2,453

(3,234)

Balance brought forward from previous year

184,021

171,952

Transition impact of Ind AS 116, net of tax

-

(78)

Balance

184,021

171,874

Profit available for appropriation

226,432

217,130

Equity Dividends (Including tax on Dividends)

(19,335) 2

(27,522)1

Transfer to retained earnings on account of options lapsed

96

59

Others

-

26

Transferred to Special Economic Zone re-investment reserve (net of utilisation)

(6,319)

(5,540)

Buyback of equity shares (refer note 18(v))

-

(132)

Balance carried forward

200,874

184,021

1 Interim Dividend for the financial year ended March 31, 2020 and Final Dividend for the financial year ended March 31, 2019

2 Interim Dividend (Special Dividend) for the financial year ended March 31, 2021 and Final Dividend for the financial year ended March 31, 2020

DIVIDEND

The Board of Directors on October 23, 2020 approved a special dividend of '' 15/- per equity share (i.e. 300%) on par value of '' 5/- each which was paid by the Company to the shareholders whose names were appearing in the Register of Members as on November 2, 2020 being the record date for the payment of dividend. Your Directors are pleased to recommend a final dividend of '' 30/- per share (including a special dividend of '' 15/-per share) on par value of '' 5/- (i.e. 600%), payable to those Shareholders whose names appear in the Register of Members as on the Book Closure Date. Thus, the total dividend for the Financial Year 2020-21 will be '' 45/- per share (i.e. 900%) as against '' 15/- per share (i.e. 300%) in the Financial Year 2019-20.

Your Company has formulated a Dividend Policy which is disclosed on the website of the Company at https:// insights.techmahindra.com/investors/tml-dividend-distribution-policy.pdf

SHARE CAPITAL

During the year under review, your Company allotted 2,407,703 equity shares on the exercise of stock options under various Employee Stock Option Schemes. Consequently, the issued, subscribed and paid-up equity share capital has increased from '' 4,829 million divided into 965,852,364 equity shares of '' 5/- each to '' 4,841 million divided into 968,260,067 equity shares of '' 5/- each.

BUSINESS PERFORMANCE / FINANCIAL OVERVIEW

The Company provides connected experiences, offering innovative and customer-centric information technology experiences, enabling Enterprises, Associates and the Society to Rise™. The Company has over 121,000 professionals in over 90 countries, helping 1,007 global customers including many Fortune 500 companies. The Company’s convergent, digital, design experiences, innovation platforms

and reusable assets connect across a number of technologies to deliver tangible business value and experiences to stakeholders. Your Company also focuses on sustainable business strategy, managing social and environmental impacts, while ensuring that corporate decisions lead to an equitable growth. As a result, Tech Mahindra is one of the three companies from India to be included in the DJSI World Index 2020 and one of the eleven Indian companies in the Emerging markets category.

During the Financial Year 2020-21, the Company’s consolidated revenues increased to '' 378,551 million from '' 368,677 million in the previous year, a growth of 2.7%. The geographic split of revenue is 47.5% from the Americas, 26% from Europe and 26.5% from the Rest of the World.

The consolidated Profit (including other income) before Interest, Depreciation and Tax was at '' 75,846 million, against '' 66,955 million in the previous year.

The consolidated Profit after Tax amounted to '' 43,530 million as against '' 38,974 million in the previous year.

In an age of regular technological disruption, Tech Mahindra is delivering value to its customers with its domain expertise and wide range of offerings in blockchain, machine learning, artificial intelligence, cloud, cyber security, quantum computing and IoT combined with an intimate understanding of each customer and their objectives. The Company has collaborated with industry leaders and startups, academia and partners under TechMNxt charter to provide customized yet simplified solutions for customers.

IMPACT OF COVID-19

The COVID - 19 pandemic that began in Q4 of FY 2019-20, continues to impact people globally, causing healthcare crisis, impacting economies and businesses at large. Economic activity took a backseat as most efforts were channelized in strengthening health infrastructure and supporting weaker sections of the economy. The Company did witness impact in several of its clients, as organizations resorted to cash conservation and reduction of discretionary spending. This impacted demand in the first half of Financial Year 2020-21. Your Company undertook several initiatives to ensuring safety of its people, assets and communities at large. The Company deployed business continuity plans ensuring continues service to customers throughout these tough times. Your

Company realigned its strategy, modified the delivery model and crafted solutions focused on enabling the clients to imagine the future of their business, building and running it for them. This led to a robust demand in the second half of the year, as your Company helped adopt massive technological changes and new business models.

ACQUISITIONS

CERIUM

The Company on April 9, 2020 acquired 51% of the share capital of Cerium Systems Private Limited (Cerium). The enterprise value of Cerium is '' 2,450 million. Cerium is an integrated circuit and embedded software design service provider that is expected to help bolster Tech Mahindra’s capabilities in the areas of semiconductor design and testing, embedded software development / testing and product engineering. The remaining 49% to be acquired over the next three years at a valuation linked to the financial performance of Cerium. During the year, the Company acquired a further 6% stake thereby taking the total shareholding to 57%.

ZEN3

The Company on April 9, 2020, acquired 100% of the share capital of Zen3 for a cash consideration of USD 64 million, out of which USD 35 million was paid upfront, USD 4 million will be paid over two years and maximum upto USD 25 million will be paid over three years linked to financial performance. Zen3 is leading software solution group with strong capabilities in AI enablement services, AI speech solutions, cloud engineering, software product engineering and DevOps. Zen3 has more than 1,300 employees across offices in Seattle, Dublin, Bengaluru, Hyderabad and Vishakhapatnam.

TENZING

The Company acquired 100% of the share capital of Tenzing Ltd and Tenzing Australia Ltd (Tenzing Group) through its wholly owned subsidiary Tech Mahindra (Singapore) Pte Ltd at a consideration of USD 29.5 million including earnouts. The Company is headquartered in Auckland, New Zealand and is engaged in the business of Management Consulting, Digital Transformation and Technology services. It has 145 employees and a turnover of USD 27.4 million. The acquisition will bring strong capabilities primarily in the Insurance vertical along with expanding footprint in the Australia and New Zealand (ANZ) market. The acquisition was completed on December 1, 2020.

MOMENTON

Momenton Pty. Ltd. ("Momenton”) was acquired by the Company through its wholly owned subsidiary viz., Tech Mahindra (Singapore) Pte Limited at a consideration upto AUD 14.3 million including earnouts. The company is headquartered in Melbourne, Australia and has approximately 55 employees. Turnover for the financial year ended 30th June 2020, was AUD 10.8 million. Momenton is a cloud and engineering services provider with a Banking and Financial Services (BFS) focus. The acquisition will enhance Tech Mahindra’s digital transformation capabilities and provide Tech Mahindra a scaled-up presence in the Australian BFS market. This acquisition was completed on 12th February 2021.

PERIGORD

The Company acquired 70% of Perigord Asset Holdings Limited ("Perigord”) through its wholly owned subsidiary Mahindra Engineering Services (Europe) Ltd at a consideration of EUR 21 Million and the remaining 30% will be acquired over the next four years at a valuation linked to financial performance of the company. Perigord is headquartered in Dublin, Ireland with a presence in Germany, USA and India with 380 employees. For the financial year ending 31st December 2020, the company had revenue of EUR 19.5 million The Indian subsidiaries of Perigord were acquired by the Company directly.

Perigord specialized in end to end packaging supply chain solutions to the life sciences industry with services such as packaging artwork & labelling services, strategic consultancy, creative and digital, strategic outsourcing, managed services and software solutions. The acquisition was completed on 15th March, 2021.

PAYMENTS TECHNOLOGY SERVICES LIMITED

The Company announced the acquisition of Payments Technology Services Limited, Hongkong on 12th January 2021 at a consideration of USD 9 million. The company is headquartered in Hong Kong and has approximately 109 employees. Turnover of the Company for the financial year ended 31st December 2019 was USD 5.4 million.

The Payments Technology Services entity is a step-down subsidiary of Fidelity Information Services (FIS). The acquired capabilities in the payments space will give us access to IPs and licenses for two products, which is consistent with the strategy of

pivoting the business towards products and platform implementations as well as participating in the banking transformation programs. This acquisition will open up other opportunities for Tech Mahindra across a number of areas in partnership with FIS.

DIGITALONUS

The Company announced the acquisition of DigitalOnUs, Inc. ("DigitalOnUs”) on 19th April 2021 at an enterprise value of USD 120 million through its wholly owned subsidiary, Tech Mahindra (Americas) Inc. The company is headquartered in San Jose, California, USA. DigitalOnUs is focused on Cloud Native Development and Hybrid Cloud Automation services. The acquisition of DigitalOnUs will enhance Tech Mahindra’s capability in cloud native engineering and position it to develop cutting-edge digital solutions for its customers. DigitalOnUs has more than 380 employees. For the financial year ending 31st December 2020, the company had revenue of USD 30.6 million. The Indian subsidiary of DigitalOnUs namely DigitalOps Technology Private Limited has been acquired by the Company.

EVENTUS

The Company announced the acquisition of Eventus Solutions Group, LLC. ("Eventus”) on April 26, 2021 through its wholly owned subsidiary Tech Mahindra (Americas) Inc. at a consideration of USD 44 million. Eventus provides end-to-end customer engagement solutions, such as strategy consulting, cloud based tools and automation services and managed services. The company is headquartered in Denver, Colorado. It has a turnover of USD 33.2 million in CY2020, with an employee base of around 100 spread across various states in the US.

The acquisition of Payment Technology Services Ltd, DigitalOnUs and Eventus are yet to be consummated on the date of this report.

DETAILS OF SUBSIDIARIES / JOINT VENTURES / ASSOCIATE COMPANIES

The performance and financial position of the subsidiaries, associate companies and joint venture companies included in the consolidated financial statement is provided in accordance with the provisions of Section 129 read with Rule 5 of the Companies (Accounts) Rules, 2014 containing the salient features of the financial statement of Company’s subsidiaries/joint ventures or associate companies in Form AOC - 1 in “Annexure I” to this report.

Pursuant to Rule 8(5)(iv) of the Companies (Accounts) Rules, 2014, the names of the companies which have been incorporated or ceased to be the subsidiaries, joint ventures or associate companies during the year are provided in “Annexure II” to this report. The Company is actively pursuing the initiative on consolidation of its subsidiaries/branches to optimise the operational costs. During the year under review, your Company has closed/merged Eight subsidiaries.

In terms of the provisions of Regulation 24 of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, Tech Mahindra (Americas) Inc. is a wholly owned unlisted material subsidiary of the Company.

The policy for determining material subsidiaries formulated by the Board of Directors is disclosed on the Company’s website and is accessible on https:// insights.techmahindra.com/investors/Policy-For-Determining-Material-Subsidiaries.pdf

UPDATE ON MERGER

The Board of Directors at its meeting held on January 31, 2021 approved the Scheme of Merger of Tech Mahindra Business Services Ltd and Born Commerce Private Ltd with the Company. Accordingly, the companies filed the applications before Hon’ble National Company Law Tribunal (NCLT), Mumbai and Chennai Benches respectively. The applications are pending for admission as on the date of this Report.

HUMAN RESOURCES

Your Company has taken several initiatives in the development of human resources, the most important asset of the Company. Some of the initiatives taken in this area are -

Wellness: Putting Well-being at the Forefront

Since 2017, your Company has been leading a unique corporate wellness program called "Wellness Before Business” that has helped prioritize health as the foundation of its associates’ professional, personal, and spiritual well-being. Your Company was able to adapt faster to the challenges of the COVID-19 pandemic, with all actions aligned to this belief. It also gave birth to the mantra of #WellnessFirst and encouraged mental & virtual connect amongst teams while remaining physically apart. Your Company launched the AMIGO Program for holistic emotional and mental wellness for associates and their dependents. Your Company conducted daily health sessions for mental (psychological experts with byte sized videos), emotional (stay connected virtually while

maintaining social distance) and physical (how to stay healthy and fit) wellness. By transitioning to virtual wellness services, daily sessions with experts and incentivizing wellness benefits, your Company has encouraged its associates stay distant, yet connected.

Pandemic: Enabling Work from Home

Your Company was amongst the first to publicly express the need for staying distant and being safe with a logo tweak, the "e” in "Tech Mahindra” being boxed inside a home. Your Company formed Rapid Action Task forces at different locations for business continuity and enabling work from home. These teams helped in collaborating with government authorities, complying with health advisories, implementing best practices like travel restrictions and defining local emergency protocols. Your Company also rolled out several new policies like Remote Workstation set up, Laptop Rental, Special COVID-19 Leave Benefit, Insurance cover for Home Quarantine and Vaccination Cost Reimbursement to support working from home. Associates were also provided with infrastructure support for networking and security requirements. To make associates and managers accustomed to working from home, the WFH101 program was launched within a week of the lockdown. These activities enabled over 90% of associates to work from home productively within 72 hours of the government’s lockdown announcement.

Leadership: Peacetime Leaders to Wartime Generals

The COVID-19 pandemic changed the leadership paradigm and style of functioning. Your Peacetime Leaders became Wartime Generals. Like in war, one does not have the luxury of time to mull over decision making, the pandemic called for leaders to become agile, think fast and act faster. It meant being focused and yet open to revisiting strategies, taking bold risks, judiciously deploying resources and above all, working tirelessly till the war was won! This new model of ‘Wartime Generals’ is what your Company sought to create. These new leaders helped rally their teams, kept the team engaged and communicated clear, crisp messages frequently while challenging conventional thinking. Your Company has launched a real-time Performance Management System for its top 300 leaders to drive a high-performance culture which ensures that key business initiatives and leaders’ goals are in-sync and tracked regularly. Your Company has also setup five transformation offices and identified 36 strategic initiatives along with output metrics, targets and RACI.

Communication: Frequent, Transparent and Empathetic

With associates working from home, your Company faced natural challenges in ensuring that a distributed workforce stayed connected. Your Company communicated with urgency, transparency and empathy to help associates adjust to the constantly changing conditions crises bring and to maintain a single source of truth. Your Company created a live microsite to prioritize consistent and continuous communication. Your Company launched a daily newsletter called TechM Coronicles that included a video message from a leader, inspirational stories, clarification of rumours, training calendars, associate engagements and customer kudos. Additionally, a new connect series called PrimeTime was introduced to keep associates updated and inspired by external speakers. This was a daily one-hour virtual connect and it featured global leaders from a cross section of industries including Sports, Cinema and Politics. There were close to 150 episodes of Primetime over the course of the year.

Engagement: lovetobeTechM has no boundaries

Your Company used connected technologies to create meaningful experiences for associates working remotely and organized several collaborative activities that included their families. Through the "Each One House One” initiative associates welcomed their colleagues from their neighborhood into their homes. Your Company also facilitated the return of approximately 2000 associates and their families who were stranded abroad through repatriation flights.

Rewards: Nurturing A Culture of Giving

Your Company and its associates believe in driving positive change especially the vulnerable communities impacted during pandemic through individual and Company social responsibility. Last year associates donated ''1.5 million towards social causes - a 105% increase over the previous year. Associates also helped vulnerable communities through voluntary services like grocery/grain distribution, tree plantation and community drives, taking care of migrant workers, donating PPE kits / medical supplies etc. Your Company also facilitated the screening of around 10,000 third-party vendors, associates and members of the partner ecosystem including those working in pantry, sanitation and security departments through the Mhealthy platform. Mhealthy was launched in July 2020 with 32 screening tests, risk profile, access to medical care, antibody test for COVID-19 to secure the workplace. Through these numerous measures,

your Company has continued to recognise the extra ordinary resilience shown by associates through its digital platform that nurtures appreciation and social sharing.

Hiring: Reversing the pyramid

Your Company has taken proactive steps to introduce young talent that will thrive in the ‘new normal.’ With the launch of new programs like LEAP and ELEVATE, your Company gives fresh graduates the flexibility of remote work from home. These programs in addition to the existing ELITE Engineering graduate hiring, Management Trainee program (for hiring fresh talent from B-schools) and Global Leadership Cadre program (for fast-tracking the growth of young leaders) help your Company reverse the pyramid. Your Company has also expanded the use of the #NewAgeDelivery platform in the hiring process by checking for internal talent that are to be released from projects or those already on the bench so as to reduce external hiring costs.

Learning: Becoming Fit4Future

During the year virtual learning picked up momentum as your Company prioritized re-skilling and upskilling through the NAD Learn (formerly Upskilling as a Service) platform. This self-learning ecosystem has offered more than 55,000 associates the opportunity to become full-stack/ full cycle professionals. 20,000 associates are engaged in the RIDE Future Skilling program that is helping your Company transition to new age technologies. Your Company launched EMBARK to train 500 Program Managers on ten special competencies. The top 300 Leaders who completed the Chrysalis program last year had a special 3-month development journey to help them lead during this unprecedented time. Your Company has also helped 400 customers across 31 countries prepare for a post COVID-19 world by sharing best practices and learning content.

Diversity: Creating a sense of Belonging

Your Company reinforced its commitment to being intentionally diverse by becoming a signatory of UN Women and a part of the WEP (Women’s Empowerment Principles) Community. The Women Leaders Program has helped your Company identify more than 50 trailblazers who can drive future business in the ‘new normal.’ Focussed efforts were made towards generational diversity as young leaders were developed through programs like AIM, Ascend and Transcend.

QUALITY

The Company continues its focus on quality and strives to exceed customer expectations at all times. During the year, it continued to strengthen the implementation of CMMI Dev v1.3 (Capability Maturity Model Integration) Dev v1.3 (Capability Maturity Model Integration) (Development) for which the organization is assessed at L5. Similarly it underwent various upgrade and continuous evaluation audits for multiple standards during the year in order to meet client demands and enhance value delivery - Successfully assessed for, CMMI Dev v 1.3, Level 5, ISO 9001:2015 (Quality Management System), ISO 20000-1:2018 (Information Technology Service Management System), ISO 27001:2013 (Information Security Management System), TL9000 R 6.2/ R5.6 (Quality Management Systems for Tele Communications industry), ISO 13485:2016 (Quality Management Systems for medical devices - scope of certification limited to medical devices business within Tech Mahindra), AS9100 Rev D (Standard for Aerospace domain - scope of certification limited to the aerospace business within Tech Mahindra).

In addition to these, your Company also maintains its commitment to health, safety and environment by continually improving its processes in accordance with ISO 14001:2015 (Environmental Management System) and ISO 45001: 2018 (Occupational Health and Safety Assessment Series) standards. Your Company is also certified on ISO 22301:2012 (Societal Security and Business Continuity Management System) and has a comprehensive Business Continuity and Disaster Recovery framework, to prevent potential business disruptions in the event of any disaster. It has processes that helped resume services to customer’s acceptable service levels. Automated Service Desk with SLAs for enabling business and Vulnerability Assessment and Penetration Testing Lab for secured corporate network operations are highlights that showcase the information security posture of the Organization.

During the pandemic year, the entire quality management system was put to test, associates were working from home while complying with all security requirements and able to deliver the services to the desired quality as per customer contractual commitments.

Tech Mahindra (IT Division) has been assessed for the implementation of high maturity business excellence practices at Mahindra Group (Services Sector). It has

been assessed at TMW Maturity Stage 6 (on scale of 1-10 stages) of Mahindra Business Excellence Framework - The Mahindra Way. These certifications are testimony of the robustness of business processes and at large the quality culture imbibed in the organization.

Your Company has continued to strengthen the process for transforming Quality Assurance processes & delivery methods to New Age Delivery processes through the #NewAgeDelivery Engine. This engine focuses on asset creation and re-usability, enabling associates to be rightly skilled through Upskilling as a service, enabling projects and programs to deploy smart planning and crowd sourcing through Capability as a service, providing an automated workflow environment for the associates to execute the project seamlessly through Digital inside and Continuous Delivery. All of this has lead to better customer experience and faster quality delivery. This engine is further strengthened with command center view for the programs and units to access their realtime performance against the targets. Moreover the system is enabled with automated signals and alerts when the performance breaches the threshold for the owner to take corrective actions. The Company is putting all these initiatives in place to ensure that it deliver as stated in its Quality Policy.

DIRECTORS

During the year under review, all Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Independent Directors have also given declaration of compliance with Rules 6(1) and 6(2) of the Companies (Appointment and Qualification of Directors) Rules, 2014, with respect to their name appearing in the data bank of Independent Directors maintained by the Indian Institute of Corporate Affairs.

Pursuant to the provisions of Section 152(6)(c) of the Companies Act, 2013, Dr. Anish Shah is liable to retire by rotation and offers himself for reappointment.

Dr. Anish Shah (DIN: 02719429) who was appointed as an Additional Director with effect from September 10, 2019 has been appointed as Director of the Company at the Annual General Meeting held on July 28, 2020.

Your Directors co-opted Mr. Manoj Bhat (DIN: 05205447) as an Additional Director with effect from 2nd April 2021 whose term will end at the ensuing Annual General Meeting and being eligible offers himself for appointment.

Mr. V.S. Parthasarathy, (DIN: 00125299) resigned as director of the Company with effect from 31st January 2021. Your board places on record its sincere appreciation for the valuable services rendered by Mr. Parthasarathy to the Company during his tenure.

In terms of Regulation 24(1) of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, Mr. T. N. Manoharan, Independent Director of the Company has been appointed as Director in Tech Mahindra (Americas) Inc., a Wholly owned unlisted material subsidiary of the Company with effect from May 21, 2019.

Mr. T. N. Manoharan was also appointed as Lead Independent Director by the Board of Directors at its Meeting held on April 26, 2021.

In the opinion of the Board of Directors the Independent Directors have relevant proficiency, expertise and experience.

FAMILIARISATION PROGRAMME

These programmes aim to provide insights into the Company to enable the Independent Directors to understand its business in depth and contribute significantly to the Company. The details of program for familiarisation of the Independent Directors with the Company are available on the Company’s website and can be accessed at; https://insights. techmahindra.com/investors/tml-familarisation-progarmmes-for-IDs.pdf

The Board members are also regularly updated on changes in the statutory provisions like changes in Corporate Laws, SEBI Regulations, Taxation Laws and People related laws as applicable at the quarterly Board meetings. The Board members are also updated on the Risk universe applicable to the Company’s business. The MD & CEO of the Company had a quarterly session with Board members sharing updates about the Company’s business strategy, operations and the key trends in the IT industry that are relevant for the Company. These updates help the board members in keeping abreast of the key changes and their impact on the Company.

BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and Regulation 19 read with Schedule II, Part D of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has devised a policy on evaluating the performance of the Board of Directors, the Chairman, Committees, and Individual Directors. The evaluation process was carried out through a web-based portal. The summary of the evaluation reports was presented to the respective Committees and the Board. The Directors had a positive feedback on the overall functioning of the Committees and the Board. The suggestions made by the Directors in the evaluation process have been suitably incorporated in the processes.

NUMBER OF MEETINGS OF THE BOARD

The Board met seven times during the financial year 2020-21. The meeting details are provided in Corporate Governance report that forms part of this Annual Report. The maximum interval between any two meetings did not exceed 120 days as prescribed in the Companies Act, 2013 and SEBI Listing Regulations.

POLICY ON DIRECTORS’ APPOINTMENT AND REMUNERATION

The Governance policies laid down by the Board of Directors of your Company include:

i. Policy on appointment and removal of Directors, Key Managerial Personnel and Senior Management.

ii. Policy on remuneration to the Directors, Key Managerial Personnel and Senior Management and other Employees.

The extract of these two policies are provided in “Annexure III”.

The policies are available on the Company’s website on https://insights.techmahindra.com/investors/ Governance-Policies-including-remuneration-to-Directors-KMPS.pdf

SUCCESSION PLAN

In accordance with the principles of transparency and consistency, your Company has adopted governance policies for its Board of Directors, Key Managerial Personnel & senior management appointments, remuneration and evaluation. In line with these Governance policies, the Company has

established a formal Succession Planning Program for key managerial persons across the organization. The Board evaluates all such plans at a regular intervals and institutes a formal program for filling any such critical position. The Board evaluates both internal and external candidates for such positions alongwith the recommendations of the Company. The Company also has a leadership development program where it identifies high potential managers, and trains them to take up the positions of higher responsibilities. The Company has identified the second line of leadership, which provides stability to the business in any contingencies.

TRAINING

The Company has laid down a policy on training for Independent Directors, as part of the governance policies. The Senior Leadership of the Company update the Directors on the regulatory changes, Business strategy and operations periodically.

KEY MANAGERIAL PERSONNEL (KMP)

Pursuant to provisions of Section 203 of the Companies Act, 2013, Mr. C. P Gurnani, Managing Director & Chief Executive Officer, Mr. Manoj Bhat, Chief Financial Officer and Mr. Anil Khatri, Company Secretary & Compliance Officer were the Key Managerial Personnel of the Company during the year under review. Mr. Milind Kulkarni was appointed as Chief Financial Officer of the Company w.e.f. 2nd April 2021.

DIRECTORS’ RESPONSIBILITY STATEMENT

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

i. in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

ii. they have, in the selection of the accounting policies, consulted the Statutory Auditors and these have been applied consistently and, reasonable and prudent judgments and estimates have been made so as to give a true and fair view of the state of affairs of the Company as at March 31, 2021 and of the profit of the Company for the year ended on that date;

iii. proper and sufficient care had been taken 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 other irregularities;

iv. the annual accounts have been prepared on a going concern basis;

v. they had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively;

vi. the proper systems to ensure compliance with the provisions of all applicable laws are in place and are adequate and operating effectively.

DETAILS WITH RESPECT TO ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS

The Company has internal financial controls which are adequate and were operating effectively. The controls are adequate for ensuring the orderly and efficient conduct of the business, including adherence to the Company’s policies, the safe guarding of assets, the prevention & detection of frauds & errors, the accuracy and completeness of accounting records and timely preparation of reliable financial information.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS / PROCEEDINGS

There are no significant and material orders passed by the regulators or courts or tribunal impacting the going concern status and the Company’s operations in the future.

Further no application against the Company has been filed or is pending under the Insolvency and Bankruptcy Code, 2016, nor the Company has done any one time settlement with any Bank or Financial institutions.

STATUTORY AUDITORS

The members, in the 30th Annual General Meeting held on August 1, 2017, appointed B S R & Co. LLP, Chartered Accountants, [Firm’s Registration No. 101248W/W- 100022] as the Statutory Auditors of the Company, to hold office for a term of five years from the conclusion of the 30th Annual General Meeting (AGM) of the Company held in the financial year 201718 until the conclusion of the AGM of the Company for the financial year 2021- 22 on such remuneration as may be determined by the Board of Directors.

The members may note that the Ministry of Corporate Affairs vide notification dated May 07, 2018, has done away with the requirement of yearly ratification of appointment of Statutory Auditors, at the AGM.

Pursuant to Section 139 of the Companies Act, 2013 the statutory auditors B S R & Co. LLP, Chartered Accountants have confirmed that they are eligible to continue as auditors.

There are no qualifications, reservations, adverse remark or disclaimer made in the audit report for the Financial Year 2020-21.

SECRETARIAL AUDIT REPORT

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 had appointed Dr. K. R. Chandratre, Practicing Company Secretary, Pune to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is available at “Annexure IV” to this report. There are no qualifications, reservations, adverse remark or disclaimer made in the Secretarial Audit Report.

COMPLIANCE WITH SECRETARIAL STANDARDS

The Company has complied with the applicable Secretarial Standards.

ANNUAL RETURN

Pursuant to the provisions of Section 92(3) read with Section 134(3) (a) of the Companies Act, 2013, the Annual Return in Form MGT-7 is available at the web link: https://insights.techmahindra.com/investors/mgt7-annual-return-202021.pdf

MANAGERIAL REMUNERATION

Disclosures of the ratio of the remuneration of each director to the median employee’s remuneration and other details as required pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended from time to time, are provided as “Annexure V”.

None of the directors or Managing Director & CEO of the Company, received any remuneration or commission from Subsidiary Companies of your Company.

The details of remuneration paid to the Directors including the Managing Director & CEO of the Company are given in Corporate Governance Report.

PARTICULARS OF EMPLOYEES

The information required under Section 197(12) of the Companies Act, 2013 ("the Act”) read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms part of this Report. However, pursuant to first proviso to Section 136(1) of the Act, this Report is being sent to the Shareholders excluding the aforesaid information. Any shareholder interested in obtaining said information, may write to the Company Secretary at the Registered Office / Corporate Office of the Company and the said information is open for inspection at the Registered Office of the Company.

POLICY ON PREVENTION OF SEXUAL HARASSMENT

Your Company laid down Prevention of Sexual Harassment (POSH) policy which is available on its website. The Company has zero tolerance on Sexual Harassment at workplace. During the year under review there were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

The status of complaints received under POSH and redressed by the POSH Committee of the Company, during the financial year under review, are given below:

a) Number of complaints received - 30

b) Number of complaints redressed - 28

c) Number of complaints pending - 2

The Company carried out focused campaign on POSH and Awareness drives with the help of its BPS teams. Further the employees are required to undertake mandatory certification on POSH to strengthen the POSH awareness and sensitivity.

EMPLOYEE STOCK OPTION SCHEMES

During the year under review, there were no material changes in the Employee Stock Option Schemes (ESOPs) of the Company and the Schemes are in compliance with the SEBI Regulations on ESOPs. As per Regulation 14 of SEBI (Share Based Employee Benefits) Regulations, 2014 read with SEBI circular dated June 16, 2015 the details of the ESOPs are uploaded on the Company’s website; https:// insights.techmahindra.com/investors/Details-of-ESOPs-FY-2020-21.pdf

CORPORATE GOVERNANCE

A report on Corporate Governance covering among others composition, details of meetings of the Board and Committees along with a certificate for compliance with the conditions of Corporate Governance in accordance with the Securities and Exchange Board of India (Listing Obligations And Disclosure Requirements) Regulations, 2015, issued by the Statutory Auditors of the Company, forms part of this Annual Report.

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.

COST RECORDS

Maintenance of cost records and requirement of cost audit as prescribed under the provisions of Section 148 (1) of the Companies Act, 2013 are not applicable for the business activities of the Company.

RISK MANAGEMENT

The Risk Management Committee of the Board of Directors guides the operating management to identify risks, analyze their probability and impact and prepare mitigation plans. It periodically reviews the Risk Management Framework & Enterprise Risk Register which is presented by the Chief Risk Officer. The Company identifies all potential risks, economical, business, currency, operational, climate, governance, financial etc and prepares a mitigation plan for each of the risks. The elements of risk as identified by the Company with the impact and mitigation strategy are set out in the Management Discussion and Analysis Report (MDA).

ESTABLISHMENT OF VIGIL MECHANISM

The Company has laid down Whistle Blower Policy covering Vigil Mechanism with protective Clauses for the Whistle Blowers. The Whistle Blower Policy is made available on the website of the Company.

DEPOSITS / LOANS & ADVANCES, GUARANTEES OR INVESTMENTS

The Company has not accepted any deposits from the public during the year under review. The particulars of loans/advances, guarantees and investments under Section 186 of the Companies Act, 2013 are given in the notes forming part of the Financial Statements.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All transactions entered into with Related Parties as defined under Section 2(76) of the Companies Act, 2013 and Regulation 23 of the Securities and Exchange Board of India (Listing Obligations And Disclosure Requirements) Regulations, 2015, ("The Listing Regulations”), during the financial year under review were in the ordinary course of business and at an arm’s length pricing basis and do not attract the provisions of Section 188 of the Companies Act, 2013. There were no transactions with related parties in the financial year which were in conflict with the interest of the Company and requiring compliance of the provisions of Regulation 23 of the Listing Regulations. Suitable disclosure as required by the Indian Accounting Standards (Ind AS 24) has been made in the notes forming part of the Financial Statements.

The Company has formulated a policy on the materiality of Related Party Transactions and dealing with Related Party Transactions which has been uploaded on the Company’s website and can be accessed at following link https://insights.techmahindra.com/investors/Related-Party-Transactions-Policy.pdf

The particulars of related party transactions in prescribed Form AOC - 2 are attached as “Annexure VI”.

Pursuant to Regulation 23(9) of the Listing Regulations your Company has filed half yearly report on Related Party Transactions with the stock exchanges.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars as prescribed under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 are provided in “Annexure VII” which forms part of this report.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

The CSR vision of the Company is "Empowerment through Education.”

In compliance with the guidelines prescribed under Section 135 of the Companies Act, 2013, your Company has constituted a Corporate Social Responsibility (CSR) Committee of the Board. The CSR policy, covering the Objectives, Focus Areas, Governance Structure Monitoring and Reporting

Framework among others is approved by the Board of Directors. In accordance with the amendments made in Section 135 in January 2021, the CSR Policy has been duly revised and is available at https://files. techmahindra.com/static/img/pdf/csr-policy-techm-v3-march2021.pdf

The Company has spent more than 2% of the average net profits of the Company during the three immediately preceding financial years on CSR. During the year under review, the Company contributed a significant amount towards COVID-19 relief efforts.

The Company’s social initiatives are mainly carried out by Tech Mahindra Foundation and Mahindra Educational Institutions, Section 8 (erstwhile Section 25) Companies promoted by the Company.

TECH MAHINDRA FOUNDATION (TMF)

The Foundation was set up in 2006, as a Section 25 Company (referred to as a Section 8 Company in the Companies Act, 2013). Since then, it has worked tirelessly towards the overarching vision of "Empowerment through Education”, establishing itself as a prominent CSR player within the Mahindra Group as well as a leading social organization at the national level. The Foundation essentially works with children, youth and teachers from disadvantaged urban communities in India, with a special focus on women and persons with disabilities. During the year under review, Tech Mahindra Foundation has successfully implemented 150 high-impact projects with more than 90 partners, directly benefitting 31,767 individuals. In addition, the Foundation reached out to over 1.5 Million people across the country through its COVID Relief efforts.

EDUCATION

The key initiatives in the area of School Education include:

ALL ROUND IMPROVEMENT IN SCHOOL EDUCATION (ARISE)

Tech Mahindra Foundation’s educational initiatives under ARISE are long-term school improvement programmes, in partnership with local governments and partner organisations. The Foundation in 202021 worked with 30 government schools to turn them around into model schools of excellence. Around 6,400 students were covered under this programme.

During the year, the Foundation expanded its work for children with disabilities through its ARISE

programme. This programme is a variant of ARISE in which children with disabilities are provided chronic therapy as well as special education to help them lead more fulfilling lives. Through 25 projects, the programme enabled 2,776 differently-abled students to become better learners and more independent in managing themselves. As the interventions shifted to online mode, 430 students were provided digital tablets to ensure continuity of learning.

SHIKSHAANTAR

Shikshaantar, envisioned as a programme for enhancing capacity of government school teachers, has emerged as an important programme in the education portfolio of the Foundation. TMF works with the Municipal Corporations in East Delhi and North Delhi by running their In-Service Teacher Education Institutes, and during the year under review, as many as 6,378 teachers were trained as part of this initiative. This included specially designed modules for Digital Literacy, Cyber Security and Mental Health that were delivered to the teachers through online sessions.

MOBILE SCIENCE LAB

In order to increase the footprint of its work in education and reach the unreached, TMF launched a unique initiative in 2019-20 - the Mobile Science Lab. For this, a Mahindra bus was remodeled into a science lab on wheels that travelled across schools in East Delhi to provide STEM learning for children in grades 3 and 4. Though the program could not be implemented because of COVID, a second Mobile Science Lab was commissioned through funding received from the National Scheduled Caste Finance & Development Corporation.

EMPLOYABILITY

Skills-for-Market Training (SMART) is the Foundation’s flagship programme in employability. It is built on the vision of an educated, enabled and empowered India, and the belief that educated and skilled youth are the country’s true strength. The programme started with three Centres in 2012 and is currently running over 100 Centres at 11 locations across India. These include SMART Centres, SMART Centres (training for people with disabilities), and SMART-T Centres (training in technical trades).

I n financial year 2020-21, your Company trained 14,394 young women and men under its SMART program, of which, 1,687 were persons with disabilities. Upon successful completion of the course, more than 70% of the graduates are placed in jobs across multiple

industries. A significant achievement for the year was that the average salaries earned by the students increased by over '' 500 per month, despite the severe impact of the pandemic.

The Foundation’s commitment to setting new benchmarks in skill development in India has been underscored by the setting up of Tech Mahindra SMART Academies, which provide the highest quality of skill training to youngsters in Healthcare and Digital Technologies. During FY 2020-21, 1,317 students were enrolled to the four Healthcare Academies in Delhi, Mohali, Mumbai, and Pune, the last of which started functioning in March 2021. In addition, another 710 students were enrolled at the SMART Academies for Digital Technologies in Vizag, Hyderabad and Mohali.

TMF’s work in COVID Relief

As soon as the pandemic broke out in the beginning of the Financial Year, the TMF team shifted its emphasis towards carrying out relief activities for those who were the hardest hit - daily wagers, migrant workers, farmers, persons with disabilities and the transgender community. Through a structured and efficient intervention, the Foundation distributed nearly 6 lakhs ration kits, 3.20 lakhs cooked meals, PPE kits, masks, and medical equipment to hospitals. In all, relief efforts worth '' 14.82 crores were carried out over the year that continued into the current financial year as well. Till date, over 20 lakhs people have benefitted through these efforts.

MAHINDRA EDUCATIONAL INSTITUTIONS (MEI)

MEI - a not-for-profit, 100% subsidiary of the Company has set up Mahindra Ecole Centrale in August 2014 - through a collaborative venture between Mahindra Educational Institutions and Ecole Centrale of Paris, France (now known as Centrale Supelec) and the JNTU Hyderabad - to offer undergraduate engineering programs. Through this strong Indo-French Collaboration with Centrale Supelec and Industry connect with Tech Mahindra, MEC has emerged as a disruptive player in the field of Technical Education.

MEI has sponsored the setting up of Mahindra University to introduce diverse streams of education in addition to Engineering.

MAHINDRA UNIVERSITY

Mahindra University (MU) was notified by the Government of Telangana vide Telangana Ordinance No. 1 of 2020 dated 20th May 2020 as per the

Telangana State Private Universities (Establishment and Regulation) Act, 2018 for "educating future citizens for and of a better world”.

Mr. Anand Mahindra, Chairman of the Company and the Mahindra Group is the Founding Chancellor of the University and he believes that Professional Courses have the greatest potential to contribute to economic inclusivity and sustainable development.

The University will drive a meaningful shift in the way we deliver higher education, besides focusing on infusing emerging technologies into the education space, it will drive interdisciplinary academic excellence, integrating science technology, humanities, ethics, philosophy and design, with purpose. It will also stress on developing multiskilled leaders, who are ethical and empathetic, and capable of reflection as well as innovation.

The University is India’s first to leverage AI & EI (artificial & emotional intelligence) for both education as well as collaboration, across the board.

Besides the existing programs in Civil Engineering, Computer Science Engineering, Electrical & Electronics Engineering, and Mechanical Engineering, the Ecole Centrale School of Engineering is offering 4-year UG programs of study in Electronics & Computer Engineering, Artificial Intelligence, and Computation and Mathematics from academic session 2020-21.

In the 2020 academic session, 657 students were admitted to the University in UG engineering programs, including 42 students in the PhD program in Engineering. Due to constraints imposed by the pandemic, classes had to be held online for most of the academic session.

The University started its accreditation process with submission of requisite documentation to the National Board of Accreditation for the four UG programs in CSE, EEE, Civil and Mechanical Engineering.

The Annual Report on CSR activities is provided as “Annexure VIII”.

SUSTAINABILITY

The pandemic has reinforced the fact that a focused sustainable strategy is needed for business continuity and profitable growth. All businesses have a critical role to play as a source of finance, driving innovation, and ensuring economic growth and employment.

materials. Spread awareness and initiate campaigns on preventing single-use plastic

• Reduce, Reuse, Recycle, Recover: Implement process of Reduce, Reuse, Recycle and Recover across the value chain to limit waste and enable a circular economy

• Sustainable supply chain: Ensure our suppliers follow the highest standard of sustainable and ethical best practices; optimise logistics and transportation to reduce emissions

• Work-life balance: Provide an assured career development path and a feasible and flexi work-life balance to our associates along with a range of associate-friendly policies and processes

• Innovation: Becoming future ready by proactively encouraging Innovative thinking across the organization, adopting technology disruption to reduce emissions and going digital. Developed sustainable solutions with technologies like loT, Automation, Blockchain and AI in sustainability that will help enable a pathway to reduce emissions and other impacts of climate change.

• Green solutions: Investing in Smart grid, Microgrid-As-A-Services, Community Action Platform for Energy, Integrated Electric Vehicle Charging systems, Smart data hubs and Smart Cities for our Customers to reduce their emissions

• Individual Social Responsibility: encourage associates in making sustainability a part of their daily lives even while working from Home

• Transparency: Showcase our organizational policies, processes, risk management along with financial, environmental and social data in the Integrated Reports available online

The commitment and performances are validated by

the external recognition the Company received:

> The only Indian company to be listed in Carbon Clean 200 by Corporate Knights and As You Sow

> The only Indian IT company to score double ‘A’ in CDP Climate and CDP Water

> Included in the Climate Disclosure Project (CDP) Supplier Engagement Leaderboard 2020

The environment, social and governance (ESG) principles built-in the Tech Mahindra long-term growth strategy have helped to mitigate risks and drive profitable growth even in this crisis situation. Adopting resilient strategies and sustainable transformation with a focus on low carbon future have helped the Company to quickly adapt to disruptions and leverage the processes towards Business continuity. The Company’s commitment to environment sustainability, climate change and water security spans the entire business. As a Company with a purpose, it has delivered on its promise to run better, change faster and grow greater while also creating meaningful human experiences for all. The Cpmpany is pursuing plans that will have long-term impacts on the planet and communities, leading to a balance between sustainability and overall business profitability.

With a structured stakeholder engagement process, Tech Mahindra has been able to design strategies and initiatives, which not only improves our sustainability credentials but also reinforces its overall business philosophy. The Company is breaking through new frontiers, turning to renewable energy to achieve ecological balance while ensuring that when it comes to investments, the Company is pioneering new solutions for sustainable development. Your Company emphasis on green eco-system is seen through its commitment to going carbon neutral, making optimum use of resources and moving towards a low emission technology. The profitability of the Comopany is aligned with its principles, allowing to set sustainability milestones on its journey toward a secure future.

Your Company is aligned to the SDGs (Sustainable Development Goals) and its sustainability focus areas are as below:

• Going Carbon Neutral: Increase use of renewable energy through onsite installation and open access; improve energy efficiency through installation of LEDs, sensors; boost green investments by implementing Carbon Price; optimize business travel by enabling virtual meetings; encourage use of public transport and carpool to reduce commute emissions; plant trees to offset carbon footprints; move towards a low carbon economy ensuring environmental protection

• Saying No to plastic: Maintain plastic-free campuses and encourage associates and stakeholders to use eco-friendly & biodegradable

> One amongst only 3 companies from India to be in DJSI World Index 2020

> One of only 11 Indian Companies in DJSI Emerging Markets 2020

> Only Indian company recognized amongst the ‘2021 Global 100 Most Sustainable Corporations’ by Corporate Knights

> Scored A and included in the top 5 of India’s most Sustainable companies by Business World in collaboration with Sustain Labs Paris

> Awarded Gold rating with 94 percentile in 2020 by ECOVADIS

> Constituent of FTSE4Good Index 2020 by Financial Times Stock Exchange-Russell Group

> Winner of Mahindra Group Sustainability Performance Award 2020

> Leaders with 99 percentiles in SUSTAINALYTICS

The Integrated Annual Report is based on various global standards and frameworks like TCFD (Taskforce on Climate Related Financial Disclosures), CDSB (Climate Disclosure Standards Board), SASB (Sustainability Accounting Standard Board) and GRI standards and assured by third party according to ISAE International Standard on Assurance Engagement) 3000 standard.

Tech Mahindra discloses climate-related risks and opportunities in line with the recommendations of TCFD which focusses on the financial impact of climate-related changes on our operations.

The TechM Board is accountable for all risks and opportunities. The MD and CEO of the Company chairs the CSR Committee of the Board and has the ultimate responsibility for Sustainability. He is ably supported by the Chief Sustainability Officer who directly reports to him and Senior Management members of the Sustainability Council who manage all aspects of climate change including climate-related risks and opportunities.

The pandemic has made it imperative to make this a time of change and a time of learning. Your Company embed sustainability into COVID-19 economic recovery, implement their promises and stretch

its commitments to provide for a better and more sustainable future. Tech Mahindra is committed to the SDGs and is transitioning to a low-carbon economy to achieve the goals of Paris agreement. The strategy includes futureproofing its growth against impending changes in policies and regulations and increasing its compliance readiness. The Company is agile and adaptive to dynamic changes in internal and external environment with strategies in place to manage all business and climate change risks in an effective way. The Company has a robust business continuity management framework and incident response team that ensure it is resilient to any climate change risks.

The targets and the metrics used for managing climate related risks and the progress against these targets are disclosed in the externally assured Integrated reports available here- https://www.techmahindra. com/en-in/sustainability/

AWARDS AND RECOGNITION

Your Company continued its quest for excellence in its chosen area of business to emerge as a true global brand. Several awards and rankings continue to endorse your Company as a thought leader in the industry. Few of the Awards / recognitions received by the Company during the year 2020-21 include:

• Tech Mahindra ranked 10th - winner of ATD Best Award in the ‘Other - IT’ category

• Tech Mahindra won Gold Stevie and Bronze Stevie at "2020 Stevie Awards for Great Employers”

• Tech Mahindra’s Mhealthy won ETHealth Award for Best Technology Solution for COVID-19

• Tech Mahindra amongst 50 best workplaces for women by the Great Place to Work Institute.

• Tech Mahindra recognized amongst ‘India’s Top 20 Companies for Sustainability and CSR 2020’ by The Economic Times and Futurescape 7th Responsible Business Rankings during ETSDG Impact Summit 2020.

• Tech Mahindra recognized as a leader in 2020 Gartner Magic Quadrant for IT Services for communications service providers, worldwide.

• Tech Mahindra has featured amongst the Top 10 "Best Companies for Women in India (BCWI)” by Avtar and Working Mother for the third year in a

row and declared ‘Champions of Inclusion’ in the most inclusive companies of India Index.

• Mr. C. P. Gurnani recognized as ‘The Technology Icon of India’ by VARINDIA Brand book on ICT industry.

• Tech Mahindra featured in Fortune India 500 most valuable firms.

• TMF is a winner for the category ‘Best Corporate Foundation COVID-19 Relief Project [Large Impact]’ at the 9th India CSR Awards 2021.

• Tech Mahindra’s Surveillance Solution for Kanpur Smart City is amongst the winners at FICCI India Smart Urban Innovation Awards 2021.

• Tech Mahindra amongst Forbes Top 50 Organizations in Blockchain for 2021.

• Tech Mahindra recognized as a Leader in Gartner 2021 Magic Quadrant for Customer Service BPO.

ACKNOWLEDGEMENTS

Your Directors place on record their appreciation for the contributions made by employees towards the success of your Company more particularly ensuring business as usual in spite of COVID-19 impact. Your Directors gratefully acknowledge the co-operation and support received from the shareholders, customers, vendors, bankers, regulatory and Governmental authorities in India and abroad.

For and on behalf of the Board

Anand G. Mahindra Place: Mumbai Chairman

Date: April 26, 2021 (DIN: 00004695)


Mar 31, 2021

DIRECTORS’ REPORT

Your Directors present Thirty Fourth Annual Report together with the audited accounts of your Company for the year ended March 31, 2021.

FINANCIAL RESULTS (STANDALONE)

('' in Million)

For the year ended March 31

2021

2020

Income

305,627

315,916

Profit Before Interest, Depreciation and Tax

62,521

60,663

Interest

(632)

(667)

Depreciation

(6,623)

(6,674)

Profit Before Tax

55,266

53,322

Provision for Taxation

(12,875)

(7,977)

Profit After Tax

42,391

45,345

Other Comprehensive Income

2,453

(3,234)

Balance brought forward from previous year

184,021

171,952

Transition impact of Ind AS 116, net of tax

-

(78)

Balance

184,021

171,874

Profit available for appropriation

226,432

217,130

Equity Dividends (Including tax on Dividends)

(19,335) 2

(27,522)1

Transfer to retained earnings on account of options lapsed

96

59

Others

-

26

Transferred to Special Economic Zone re-investment reserve (net of utilisation)

(6,319)

(5,540)

Buyback of equity shares (refer note 18(v))

-

(132)

Balance carried forward

200,874

184,021

1 Interim Dividend for the financial year ended March 31, 2020 and Final Dividend for the financial year ended March 31, 2019

2 Interim Dividend (Special Dividend) for the financial year ended March 31, 2021 and Final Dividend for the financial year ended March 31, 2020

DIVIDEND

The Board of Directors on October 23, 2020 approved a special dividend of '' 15/- per equity share (i.e. 300%) on par value of '' 5/- each which was paid by the Company to the shareholders whose names were appearing in the Register of Members as on November 2, 2020 being the record date for the payment of dividend. Your Directors are pleased to recommend a final dividend of '' 30/- per share (including a special dividend of '' 15/-per share) on par value of '' 5/- (i.e. 600%), payable to those Shareholders whose names appear in the Register of Members as on the Book Closure Date. Thus, the total dividend for the Financial Year 2020-21 will be '' 45/- per share (i.e. 900%) as against '' 15/- per share (i.e. 300%) in the Financial Year 2019-20.

Your Company has formulated a Dividend Policy which is disclosed on the website of the Company at https:// insights.techmahindra.com/investors/tml-dividend-distribution-policy.pdf

SHARE CAPITAL

During the year under review, your Company allotted 2,407,703 equity shares on the exercise of stock options under various Employee Stock Option Schemes. Consequently, the issued, subscribed and paid-up equity share capital has increased from '' 4,829 million divided into 965,852,364 equity shares of '' 5/- each to '' 4,841 million divided into 968,260,067 equity shares of '' 5/- each.

BUSINESS PERFORMANCE / FINANCIAL OVERVIEW

The Company provides connected experiences, offering innovative and customer-centric information technology experiences, enabling Enterprises, Associates and the Society to Rise™. The Company has over 121,000 professionals in over 90 countries, helping 1,007 global customers including many Fortune 500 companies. The Company’s convergent, digital, design experiences, innovation platforms

and reusable assets connect across a number of technologies to deliver tangible business value and experiences to stakeholders. Your Company also focuses on sustainable business strategy, managing social and environmental impacts, while ensuring that corporate decisions lead to an equitable growth. As a result, Tech Mahindra is one of the three companies from India to be included in the DJSI World Index 2020 and one of the eleven Indian companies in the Emerging markets category.

During the Financial Year 2020-21, the Company’s consolidated revenues increased to '' 378,551 million from '' 368,677 million in the previous year, a growth of 2.7%. The geographic split of revenue is 47.5% from the Americas, 26% from Europe and 26.5% from the Rest of the World.

The consolidated Profit (including other income) before Interest, Depreciation and Tax was at '' 75,846 million, against '' 66,955 million in the previous year.

The consolidated Profit after Tax amounted to '' 43,530 million as against '' 38,974 million in the previous year.

In an age of regular technological disruption, Tech Mahindra is delivering value to its customers with its domain expertise and wide range of offerings in blockchain, machine learning, artificial intelligence, cloud, cyber security, quantum computing and IoT combined with an intimate understanding of each customer and their objectives. The Company has collaborated with industry leaders and startups, academia and partners under TechMNxt charter to provide customized yet simplified solutions for customers.

IMPACT OF COVID-19

The COVID - 19 pandemic that began in Q4 of FY 2019-20, continues to impact people globally, causing healthcare crisis, impacting economies and businesses at large. Economic activity took a backseat as most efforts were channelized in strengthening health infrastructure and supporting weaker sections of the economy. The Company did witness impact in several of its clients, as organizations resorted to cash conservation and reduction of discretionary spending. This impacted demand in the first half of Financial Year 2020-21. Your Company undertook several initiatives to ensuring safety of its people, assets and communities at large. The Company deployed business continuity plans ensuring continues service to customers throughout these tough times. Your

Company realigned its strategy, modified the delivery model and crafted solutions focused on enabling the clients to imagine the future of their business, building and running it for them. This led to a robust demand in the second half of the year, as your Company helped adopt massive technological changes and new business models.

ACQUISITIONS

CERIUM

The Company on April 9, 2020 acquired 51% of the share capital of Cerium Systems Private Limited (Cerium). The enterprise value of Cerium is '' 2,450 million. Cerium is an integrated circuit and embedded software design service provider that is expected to help bolster Tech Mahindra’s capabilities in the areas of semiconductor design and testing, embedded software development / testing and product engineering. The remaining 49% to be acquired over the next three years at a valuation linked to the financial performance of Cerium. During the year, the Company acquired a further 6% stake thereby taking the total shareholding to 57%.

ZEN3

The Company on April 9, 2020, acquired 100% of the share capital of Zen3 for a cash consideration of USD 64 million, out of which USD 35 million was paid upfront, USD 4 million will be paid over two years and maximum upto USD 25 million will be paid over three years linked to financial performance. Zen3 is leading software solution group with strong capabilities in AI enablement services, AI speech solutions, cloud engineering, software product engineering and DevOps. Zen3 has more than 1,300 employees across offices in Seattle, Dublin, Bengaluru, Hyderabad and Vishakhapatnam.

TENZING

The Company acquired 100% of the share capital of Tenzing Ltd and Tenzing Australia Ltd (Tenzing Group) through its wholly owned subsidiary Tech Mahindra (Singapore) Pte Ltd at a consideration of USD 29.5 million including earnouts. The Company is headquartered in Auckland, New Zealand and is engaged in the business of Management Consulting, Digital Transformation and Technology services. It has 145 employees and a turnover of USD 27.4 million. The acquisition will bring strong capabilities primarily in the Insurance vertical along with expanding footprint in the Australia and New Zealand (ANZ) market. The acquisition was completed on December 1, 2020.

MOMENTON

Momenton Pty. Ltd. ("Momenton”) was acquired by the Company through its wholly owned subsidiary viz., Tech Mahindra (Singapore) Pte Limited at a consideration upto AUD 14.3 million including earnouts. The company is headquartered in Melbourne, Australia and has approximately 55 employees. Turnover for the financial year ended 30th June 2020, was AUD 10.8 million. Momenton is a cloud and engineering services provider with a Banking and Financial Services (BFS) focus. The acquisition will enhance Tech Mahindra’s digital transformation capabilities and provide Tech Mahindra a scaled-up presence in the Australian BFS market. This acquisition was completed on 12th February 2021.

PERIGORD

The Company acquired 70% of Perigord Asset Holdings Limited ("Perigord”) through its wholly owned subsidiary Mahindra Engineering Services (Europe) Ltd at a consideration of EUR 21 Million and the remaining 30% will be acquired over the next four years at a valuation linked to financial performance of the company. Perigord is headquartered in Dublin, Ireland with a presence in Germany, USA and India with 380 employees. For the financial year ending 31st December 2020, the company had revenue of EUR 19.5 million The Indian subsidiaries of Perigord were acquired by the Company directly.

Perigord specialized in end to end packaging supply chain solutions to the life sciences industry with services such as packaging artwork & labelling services, strategic consultancy, creative and digital, strategic outsourcing, managed services and software solutions. The acquisition was completed on 15th March, 2021.

PAYMENTS TECHNOLOGY SERVICES LIMITED

The Company announced the acquisition of Payments Technology Services Limited, Hongkong on 12th January 2021 at a consideration of USD 9 million. The company is headquartered in Hong Kong and has approximately 109 employees. Turnover of the Company for the financial year ended 31st December 2019 was USD 5.4 million.

The Payments Technology Services entity is a step-down subsidiary of Fidelity Information Services (FIS). The acquired capabilities in the payments space will give us access to IPs and licenses for two products, which is consistent with the strategy of

pivoting the business towards products and platform implementations as well as participating in the banking transformation programs. This acquisition will open up other opportunities for Tech Mahindra across a number of areas in partnership with FIS.

DIGITALONUS

The Company announced the acquisition of DigitalOnUs, Inc. ("DigitalOnUs”) on 19th April 2021 at an enterprise value of USD 120 million through its wholly owned subsidiary, Tech Mahindra (Americas) Inc. The company is headquartered in San Jose, California, USA. DigitalOnUs is focused on Cloud Native Development and Hybrid Cloud Automation services. The acquisition of DigitalOnUs will enhance Tech Mahindra’s capability in cloud native engineering and position it to develop cutting-edge digital solutions for its customers. DigitalOnUs has more than 380 employees. For the financial year ending 31st December 2020, the company had revenue of USD 30.6 million. The Indian subsidiary of DigitalOnUs namely DigitalOps Technology Private Limited has been acquired by the Company.

EVENTUS

The Company announced the acquisition of Eventus Solutions Group, LLC. ("Eventus”) on April 26, 2021 through its wholly owned subsidiary Tech Mahindra (Americas) Inc. at a consideration of USD 44 million. Eventus provides end-to-end customer engagement solutions, such as strategy consulting, cloud based tools and automation services and managed services. The company is headquartered in Denver, Colorado. It has a turnover of USD 33.2 million in CY2020, with an employee base of around 100 spread across various states in the US.

The acquisition of Payment Technology Services Ltd, DigitalOnUs and Eventus are yet to be consummated on the date of this report.

DETAILS OF SUBSIDIARIES / JOINT VENTURES / ASSOCIATE COMPANIES

The performance and financial position of the subsidiaries, associate companies and joint venture companies included in the consolidated financial statement is provided in accordance with the provisions of Section 129 read with Rule 5 of the Companies (Accounts) Rules, 2014 containing the salient features of the financial statement of Company’s subsidiaries/joint ventures or associate companies in Form AOC - 1 in “Annexure I” to this report.

Pursuant to Rule 8(5)(iv) of the Companies (Accounts) Rules, 2014, the names of the companies which have been incorporated or ceased to be the subsidiaries, joint ventures or associate companies during the year are provided in “Annexure II” to this report. The Company is actively pursuing the initiative on consolidation of its subsidiaries/branches to optimise the operational costs. During the year under review, your Company has closed/merged Eight subsidiaries.

In terms of the provisions of Regulation 24 of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, Tech Mahindra (Americas) Inc. is a wholly owned unlisted material subsidiary of the Company.

The policy for determining material subsidiaries formulated by the Board of Directors is disclosed on the Company’s website and is accessible on https:// insights.techmahindra.com/investors/Policy-For-Determining-Material-Subsidiaries.pdf

UPDATE ON MERGER

The Board of Directors at its meeting held on January 31, 2021 approved the Scheme of Merger of Tech Mahindra Business Services Ltd and Born Commerce Private Ltd with the Company. Accordingly, the companies filed the applications before Hon’ble National Company Law Tribunal (NCLT), Mumbai and Chennai Benches respectively. The applications are pending for admission as on the date of this Report.

HUMAN RESOURCES

Your Company has taken several initiatives in the development of human resources, the most important asset of the Company. Some of the initiatives taken in this area are -

Wellness: Putting Well-being at the Forefront

Since 2017, your Company has been leading a unique corporate wellness program called "Wellness Before Business” that has helped prioritize health as the foundation of its associates’ professional, personal, and spiritual well-being. Your Company was able to adapt faster to the challenges of the COVID-19 pandemic, with all actions aligned to this belief. It also gave birth to the mantra of #WellnessFirst and encouraged mental & virtual connect amongst teams while remaining physically apart. Your Company launched the AMIGO Program for holistic emotional and mental wellness for associates and their dependents. Your Company conducted daily health sessions for mental (psychological experts with byte sized videos), emotional (stay connected virtually while

maintaining social distance) and physical (how to stay healthy and fit) wellness. By transitioning to virtual wellness services, daily sessions with experts and incentivizing wellness benefits, your Company has encouraged its associates stay distant, yet connected.

Pandemic: Enabling Work from Home

Your Company was amongst the first to publicly express the need for staying distant and being safe with a logo tweak, the "e” in "Tech Mahindra” being boxed inside a home. Your Company formed Rapid Action Task forces at different locations for business continuity and enabling work from home. These teams helped in collaborating with government authorities, complying with health advisories, implementing best practices like travel restrictions and defining local emergency protocols. Your Company also rolled out several new policies like Remote Workstation set up, Laptop Rental, Special COVID-19 Leave Benefit, Insurance cover for Home Quarantine and Vaccination Cost Reimbursement to support working from home. Associates were also provided with infrastructure support for networking and security requirements. To make associates and managers accustomed to working from home, the WFH101 program was launched within a week of the lockdown. These activities enabled over 90% of associates to work from home productively within 72 hours of the government’s lockdown announcement.

Leadership: Peacetime Leaders to Wartime Generals

The COVID-19 pandemic changed the leadership paradigm and style of functioning. Your Peacetime Leaders became Wartime Generals. Like in war, one does not have the luxury of time to mull over decision making, the pandemic called for leaders to become agile, think fast and act faster. It meant being focused and yet open to revisiting strategies, taking bold risks, judiciously deploying resources and above all, working tirelessly till the war was won! This new model of ‘Wartime Generals’ is what your Company sought to create. These new leaders helped rally their teams, kept the team engaged and communicated clear, crisp messages frequently while challenging conventional thinking. Your Company has launched a real-time Performance Management System for its top 300 leaders to drive a high-performance culture which ensures that key business initiatives and leaders’ goals are in-sync and tracked regularly. Your Company has also setup five transformation offices and identified 36 strategic initiatives along with output metrics, targets and RACI.

Communication: Frequent, Transparent and Empathetic

With associates working from home, your Company faced natural challenges in ensuring that a distributed workforce stayed connected. Your Company communicated with urgency, transparency and empathy to help associates adjust to the constantly changing conditions crises bring and to maintain a single source of truth. Your Company created a live microsite to prioritize consistent and continuous communication. Your Company launched a daily newsletter called TechM Coronicles that included a video message from a leader, inspirational stories, clarification of rumours, training calendars, associate engagements and customer kudos. Additionally, a new connect series called PrimeTime was introduced to keep associates updated and inspired by external speakers. This was a daily one-hour virtual connect and it featured global leaders from a cross section of industries including Sports, Cinema and Politics. There were close to 150 episodes of Primetime over the course of the year.

Engagement: lovetobeTechM has no boundaries

Your Company used connected technologies to create meaningful experiences for associates working remotely and organized several collaborative activities that included their families. Through the "Each One House One” initiative associates welcomed their colleagues from their neighborhood into their homes. Your Company also facilitated the return of approximately 2000 associates and their families who were stranded abroad through repatriation flights.

Rewards: Nurturing A Culture of Giving

Your Company and its associates believe in driving positive change especially the vulnerable communities impacted during pandemic through individual and Company social responsibility. Last year associates donated ''1.5 million towards social causes - a 105% increase over the previous year. Associates also helped vulnerable communities through voluntary services like grocery/grain distribution, tree plantation and community drives, taking care of migrant workers, donating PPE kits / medical supplies etc. Your Company also facilitated the screening of around 10,000 third-party vendors, associates and members of the partner ecosystem including those working in pantry, sanitation and security departments through the Mhealthy platform. Mhealthy was launched in July 2020 with 32 screening tests, risk profile, access to medical care, antibody test for COVID-19 to secure the workplace. Through these numerous measures,

your Company has continued to recognise the extra ordinary resilience shown by associates through its digital platform that nurtures appreciation and social sharing.

Hiring: Reversing the pyramid

Your Company has taken proactive steps to introduce young talent that will thrive in the ‘new normal.’ With the launch of new programs like LEAP and ELEVATE, your Company gives fresh graduates the flexibility of remote work from home. These programs in addition to the existing ELITE Engineering graduate hiring, Management Trainee program (for hiring fresh talent from B-schools) and Global Leadership Cadre program (for fast-tracking the growth of young leaders) help your Company reverse the pyramid. Your Company has also expanded the use of the #NewAgeDelivery platform in the hiring process by checking for internal talent that are to be released from projects or those already on the bench so as to reduce external hiring costs.

Learning: Becoming Fit4Future

During the year virtual learning picked up momentum as your Company prioritized re-skilling and upskilling through the NAD Learn (formerly Upskilling as a Service) platform. This self-learning ecosystem has offered more than 55,000 associates the opportunity to become full-stack/ full cycle professionals. 20,000 associates are engaged in the RIDE Future Skilling program that is helping your Company transition to new age technologies. Your Company launched EMBARK to train 500 Program Managers on ten special competencies. The top 300 Leaders who completed the Chrysalis program last year had a special 3-month development journey to help them lead during this unprecedented time. Your Company has also helped 400 customers across 31 countries prepare for a post COVID-19 world by sharing best practices and learning content.

Diversity: Creating a sense of Belonging

Your Company reinforced its commitment to being intentionally diverse by becoming a signatory of UN Women and a part of the WEP (Women’s Empowerment Principles) Community. The Women Leaders Program has helped your Company identify more than 50 trailblazers who can drive future business in the ‘new normal.’ Focussed efforts were made towards generational diversity as young leaders were developed through programs like AIM, Ascend and Transcend.

QUALITY

The Company continues its focus on quality and strives to exceed customer expectations at all times. During the year, it continued to strengthen the implementation of CMMI Dev v1.3 (Capability Maturity Model Integration) Dev v1.3 (Capability Maturity Model Integration) (Development) for which the organization is assessed at L5. Similarly it underwent various upgrade and continuous evaluation audits for multiple standards during the year in order to meet client demands and enhance value delivery - Successfully assessed for, CMMI Dev v 1.3, Level 5, ISO 9001:2015 (Quality Management System), ISO 20000-1:2018 (Information Technology Service Management System), ISO 27001:2013 (Information Security Management System), TL9000 R 6.2/ R5.6 (Quality Management Systems for Tele Communications industry), ISO 13485:2016 (Quality Management Systems for medical devices - scope of certification limited to medical devices business within Tech Mahindra), AS9100 Rev D (Standard for Aerospace domain - scope of certification limited to the aerospace business within Tech Mahindra).

In addition to these, your Company also maintains its commitment to health, safety and environment by continually improving its processes in accordance with ISO 14001:2015 (Environmental Management System) and ISO 45001: 2018 (Occupational Health and Safety Assessment Series) standards. Your Company is also certified on ISO 22301:2012 (Societal Security and Business Continuity Management System) and has a comprehensive Business Continuity and Disaster Recovery framework, to prevent potential business disruptions in the event of any disaster. It has processes that helped resume services to customer’s acceptable service levels. Automated Service Desk with SLAs for enabling business and Vulnerability Assessment and Penetration Testing Lab for secured corporate network operations are highlights that showcase the information security posture of the Organization.

During the pandemic year, the entire quality management system was put to test, associates were working from home while complying with all security requirements and able to deliver the services to the desired quality as per customer contractual commitments.

Tech Mahindra (IT Division) has been assessed for the implementation of high maturity business excellence practices at Mahindra Group (Services Sector). It has

been assessed at TMW Maturity Stage 6 (on scale of 1-10 stages) of Mahindra Business Excellence Framework - The Mahindra Way. These certifications are testimony of the robustness of business processes and at large the quality culture imbibed in the organization.

Your Company has continued to strengthen the process for transforming Quality Assurance processes & delivery methods to New Age Delivery processes through the #NewAgeDelivery Engine. This engine focuses on asset creation and re-usability, enabling associates to be rightly skilled through Upskilling as a service, enabling projects and programs to deploy smart planning and crowd sourcing through Capability as a service, providing an automated workflow environment for the associates to execute the project seamlessly through Digital inside and Continuous Delivery. All of this has lead to better customer experience and faster quality delivery. This engine is further strengthened with command center view for the programs and units to access their realtime performance against the targets. Moreover the system is enabled with automated signals and alerts when the performance breaches the threshold for the owner to take corrective actions. The Company is putting all these initiatives in place to ensure that it deliver as stated in its Quality Policy.

DIRECTORS

During the year under review, all Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Independent Directors have also given declaration of compliance with Rules 6(1) and 6(2) of the Companies (Appointment and Qualification of Directors) Rules, 2014, with respect to their name appearing in the data bank of Independent Directors maintained by the Indian Institute of Corporate Affairs.

Pursuant to the provisions of Section 152(6)(c) of the Companies Act, 2013, Dr. Anish Shah is liable to retire by rotation and offers himself for reappointment.

Dr. Anish Shah (DIN: 02719429) who was appointed as an Additional Director with effect from September 10, 2019 has been appointed as Director of the Company at the Annual General Meeting held on July 28, 2020.

Your Directors co-opted Mr. Manoj Bhat (DIN: 05205447) as an Additional Director with effect from 2nd April 2021 whose term will end at the ensuing Annual General Meeting and being eligible offers himself for appointment.

Mr. V.S. Parthasarathy, (DIN: 00125299) resigned as director of the Company with effect from 31st January 2021. Your board places on record its sincere appreciation for the valuable services rendered by Mr. Parthasarathy to the Company during his tenure.

In terms of Regulation 24(1) of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, Mr. T. N. Manoharan, Independent Director of the Company has been appointed as Director in Tech Mahindra (Americas) Inc., a Wholly owned unlisted material subsidiary of the Company with effect from May 21, 2019.

Mr. T. N. Manoharan was also appointed as Lead Independent Director by the Board of Directors at its Meeting held on April 26, 2021.

In the opinion of the Board of Directors the Independent Directors have relevant proficiency, expertise and experience.

FAMILIARISATION PROGRAMME

These programmes aim to provide insights into the Company to enable the Independent Directors to understand its business in depth and contribute significantly to the Company. The details of program for familiarisation of the Independent Directors with the Company are available on the Company’s website and can be accessed at; https://insights. techmahindra.com/investors/tml-familarisation-progarmmes-for-IDs.pdf

The Board members are also regularly updated on changes in the statutory provisions like changes in Corporate Laws, SEBI Regulations, Taxation Laws and People related laws as applicable at the quarterly Board meetings. The Board members are also updated on the Risk universe applicable to the Company’s business. The MD & CEO of the Company had a quarterly session with Board members sharing updates about the Company’s business strategy, operations and the key trends in the IT industry that are relevant for the Company. These updates help the board members in keeping abreast of the key changes and their impact on the Company.

BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and Regulation 19 read with Schedule II, Part D of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has devised a policy on evaluating the performance of the Board of Directors, the Chairman, Committees, and Individual Directors. The evaluation process was carried out through a web-based portal. The summary of the evaluation reports was presented to the respective Committees and the Board. The Directors had a positive feedback on the overall functioning of the Committees and the Board. The suggestions made by the Directors in the evaluation process have been suitably incorporated in the processes.

NUMBER OF MEETINGS OF THE BOARD

The Board met seven times during the financial year 2020-21. The meeting details are provided in Corporate Governance report that forms part of this Annual Report. The maximum interval between any two meetings did not exceed 120 days as prescribed in the Companies Act, 2013 and SEBI Listing Regulations.

POLICY ON DIRECTORS’ APPOINTMENT AND REMUNERATION

The Governance policies laid down by the Board of Directors of your Company include:

i. Policy on appointment and removal of Directors, Key Managerial Personnel and Senior Management.

ii. Policy on remuneration to the Directors, Key Managerial Personnel and Senior Management and other Employees.

The extract of these two policies are provided in “Annexure III”.

The policies are available on the Company’s website on https://insights.techmahindra.com/investors/ Governance-Policies-including-remuneration-to-Directors-KMPS.pdf

SUCCESSION PLAN

In accordance with the principles of transparency and consistency, your Company has adopted governance policies for its Board of Directors, Key Managerial Personnel & senior management appointments, remuneration and evaluation. In line with these Governance policies, the Company has

established a formal Succession Planning Program for key managerial persons across the organization. The Board evaluates all such plans at a regular intervals and institutes a formal program for filling any such critical position. The Board evaluates both internal and external candidates for such positions alongwith the recommendations of the Company. The Company also has a leadership development program where it identifies high potential managers, and trains them to take up the positions of higher responsibilities. The Company has identified the second line of leadership, which provides stability to the business in any contingencies.

TRAINING

The Company has laid down a policy on training for Independent Directors, as part of the governance policies. The Senior Leadership of the Company update the Directors on the regulatory changes, Business strategy and operations periodically.

KEY MANAGERIAL PERSONNEL (KMP)

Pursuant to provisions of Section 203 of the Companies Act, 2013, Mr. C. P Gurnani, Managing Director & Chief Executive Officer, Mr. Manoj Bhat, Chief Financial Officer and Mr. Anil Khatri, Company Secretary & Compliance Officer were the Key Managerial Personnel of the Company during the year under review. Mr. Milind Kulkarni was appointed as Chief Financial Officer of the Company w.e.f. 2nd April 2021.

DIRECTORS’ RESPONSIBILITY STATEMENT

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

i. in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

ii. they have, in the selection of the accounting policies, consulted the Statutory Auditors and these have been applied consistently and, reasonable and prudent judgments and estimates have been made so as to give a true and fair view of the state of affairs of the Company as at March 31, 2021 and of the profit of the Company for the year ended on that date;

iii. proper and sufficient care had been taken 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 other irregularities;

iv. the annual accounts have been prepared on a going concern basis;

v. they had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively;

vi. the proper systems to ensure compliance with the provisions of all applicable laws are in place and are adequate and operating effectively.

DETAILS WITH RESPECT TO ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS

The Company has internal financial controls which are adequate and were operating effectively. The controls are adequate for ensuring the orderly and efficient conduct of the business, including adherence to the Company’s policies, the safe guarding of assets, the prevention & detection of frauds & errors, the accuracy and completeness of accounting records and timely preparation of reliable financial information.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS / PROCEEDINGS

There are no significant and material orders passed by the regulators or courts or tribunal impacting the going concern status and the Company’s operations in the future.

Further no application against the Company has been filed or is pending under the Insolvency and Bankruptcy Code, 2016, nor the Company has done any one time settlement with any Bank or Financial institutions.

STATUTORY AUDITORS

The members, in the 30th Annual General Meeting held on August 1, 2017, appointed B S R & Co. LLP, Chartered Accountants, [Firm’s Registration No. 101248W/W- 100022] as the Statutory Auditors of the Company, to hold office for a term of five years from the conclusion of the 30th Annual General Meeting (AGM) of the Company held in the financial year 201718 until the conclusion of the AGM of the Company for the financial year 2021- 22 on such remuneration as may be determined by the Board of Directors.

The members may note that the Ministry of Corporate Affairs vide notification dated May 07, 2018, has done away with the requirement of yearly ratification of appointment of Statutory Auditors, at the AGM.

Pursuant to Section 139 of the Companies Act, 2013 the statutory auditors B S R & Co. LLP, Chartered Accountants have confirmed that they are eligible to continue as auditors.

There are no qualifications, reservations, adverse remark or disclaimer made in the audit report for the Financial Year 2020-21.

SECRETARIAL AUDIT REPORT

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 had appointed Dr. K. R. Chandratre, Practicing Company Secretary, Pune to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is available at “Annexure IV” to this report. There are no qualifications, reservations, adverse remark or disclaimer made in the Secretarial Audit Report.

COMPLIANCE WITH SECRETARIAL STANDARDS

The Company has complied with the applicable Secretarial Standards.

ANNUAL RETURN

Pursuant to the provisions of Section 92(3) read with Section 134(3) (a) of the Companies Act, 2013, the Annual Return in Form MGT-7 is available at the web link: https://insights.techmahindra.com/investors/mgt7-annual-return-202021.pdf

MANAGERIAL REMUNERATION

Disclosures of the ratio of the remuneration of each director to the median employee’s remuneration and other details as required pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended from time to time, are provided as “Annexure V”.

None of the directors or Managing Director & CEO of the Company, received any remuneration or commission from Subsidiary Companies of your Company.

The details of remuneration paid to the Directors including the Managing Director & CEO of the Company are given in Corporate Governance Report.

PARTICULARS OF EMPLOYEES

The information required under Section 197(12) of the Companies Act, 2013 ("the Act”) read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms part of this Report. However, pursuant to first proviso to Section 136(1) of the Act, this Report is being sent to the Shareholders excluding the aforesaid information. Any shareholder interested in obtaining said information, may write to the Company Secretary at the Registered Office / Corporate Office of the Company and the said information is open for inspection at the Registered Office of the Company.

POLICY ON PREVENTION OF SEXUAL HARASSMENT

Your Company laid down Prevention of Sexual Harassment (POSH) policy which is available on its website. The Company has zero tolerance on Sexual Harassment at workplace. During the year under review there were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

The status of complaints received under POSH and redressed by the POSH Committee of the Company, during the financial year under review, are given below:

a) Number of complaints received - 30

b) Number of complaints redressed - 28

c) Number of complaints pending - 2

The Company carried out focused campaign on POSH and Awareness drives with the help of its BPS teams. Further the employees are required to undertake mandatory certification on POSH to strengthen the POSH awareness and sensitivity.

EMPLOYEE STOCK OPTION SCHEMES

During the year under review, there were no material changes in the Employee Stock Option Schemes (ESOPs) of the Company and the Schemes are in compliance with the SEBI Regulations on ESOPs. As per Regulation 14 of SEBI (Share Based Employee Benefits) Regulations, 2014 read with SEBI circular dated June 16, 2015 the details of the ESOPs are uploaded on the Company’s website; https:// insights.techmahindra.com/investors/Details-of-ESOPs-FY-2020-21.pdf

CORPORATE GOVERNANCE

A report on Corporate Governance covering among others composition, details of meetings of the Board and Committees along with a certificate for compliance with the conditions of Corporate Governance in accordance with the Securities and Exchange Board of India (Listing Obligations And Disclosure Requirements) Regulations, 2015, issued by the Statutory Auditors of the Company, forms part of this Annual Report.

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.

COST RECORDS

Maintenance of cost records and requirement of cost audit as prescribed under the provisions of Section 148 (1) of the Companies Act, 2013 are not applicable for the business activities of the Company.

RISK MANAGEMENT

The Risk Management Committee of the Board of Directors guides the operating management to identify risks, analyze their probability and impact and prepare mitigation plans. It periodically reviews the Risk Management Framework & Enterprise Risk Register which is presented by the Chief Risk Officer. The Company identifies all potential risks, economical, business, currency, operational, climate, governance, financial etc and prepares a mitigation plan for each of the risks. The elements of risk as identified by the Company with the impact and mitigation strategy are set out in the Management Discussion and Analysis Report (MDA).

ESTABLISHMENT OF VIGIL MECHANISM

The Company has laid down Whistle Blower Policy covering Vigil Mechanism with protective Clauses for the Whistle Blowers. The Whistle Blower Policy is made available on the website of the Company.

DEPOSITS / LOANS & ADVANCES, GUARANTEES OR INVESTMENTS

The Company has not accepted any deposits from the public during the year under review. The particulars of loans/advances, guarantees and investments under Section 186 of the Companies Act, 2013 are given in the notes forming part of the Financial Statements.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All transactions entered into with Related Parties as defined under Section 2(76) of the Companies Act, 2013 and Regulation 23 of the Securities and Exchange Board of India (Listing Obligations And Disclosure Requirements) Regulations, 2015, ("The Listing Regulations”), during the financial year under review were in the ordinary course of business and at an arm’s length pricing basis and do not attract the provisions of Section 188 of the Companies Act, 2013. There were no transactions with related parties in the financial year which were in conflict with the interest of the Company and requiring compliance of the provisions of Regulation 23 of the Listing Regulations. Suitable disclosure as required by the Indian Accounting Standards (Ind AS 24) has been made in the notes forming part of the Financial Statements.

The Company has formulated a policy on the materiality of Related Party Transactions and dealing with Related Party Transactions which has been uploaded on the Company’s website and can be accessed at following link https://insights.techmahindra.com/investors/Related-Party-Transactions-Policy.pdf

The particulars of related party transactions in prescribed Form AOC - 2 are attached as “Annexure VI”.

Pursuant to Regulation 23(9) of the Listing Regulations your Company has filed half yearly report on Related Party Transactions with the stock exchanges.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars as prescribed under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 are provided in “Annexure VII” which forms part of this report.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

The CSR vision of the Company is "Empowerment through Education.”

In compliance with the guidelines prescribed under Section 135 of the Companies Act, 2013, your Company has constituted a Corporate Social Responsibility (CSR) Committee of the Board. The CSR policy, covering the Objectives, Focus Areas, Governance Structure Monitoring and Reporting

Framework among others is approved by the Board of Directors. In accordance with the amendments made in Section 135 in January 2021, the CSR Policy has been duly revised and is available at https://files. techmahindra.com/static/img/pdf/csr-policy-techm-v3-march2021.pdf

The Company has spent more than 2% of the average net profits of the Company during the three immediately preceding financial years on CSR. During the year under review, the Company contributed a significant amount towards COVID-19 relief efforts.

The Company’s social initiatives are mainly carried out by Tech Mahindra Foundation and Mahindra Educational Institutions, Section 8 (erstwhile Section 25) Companies promoted by the Company.

TECH MAHINDRA FOUNDATION (TMF)

The Foundation was set up in 2006, as a Section 25 Company (referred to as a Section 8 Company in the Companies Act, 2013). Since then, it has worked tirelessly towards the overarching vision of "Empowerment through Education”, establishing itself as a prominent CSR player within the Mahindra Group as well as a leading social organization at the national level. The Foundation essentially works with children, youth and teachers from disadvantaged urban communities in India, with a special focus on women and persons with disabilities. During the year under review, Tech Mahindra Foundation has successfully implemented 150 high-impact projects with more than 90 partners, directly benefitting 31,767 individuals. In addition, the Foundation reached out to over 1.5 Million people across the country through its COVID Relief efforts.

EDUCATION

The key initiatives in the area of School Education include:

ALL ROUND IMPROVEMENT IN SCHOOL EDUCATION (ARISE)

Tech Mahindra Foundation’s educational initiatives under ARISE are long-term school improvement programmes, in partnership with local governments and partner organisations. The Foundation in 202021 worked with 30 government schools to turn them around into model schools of excellence. Around 6,400 students were covered under this programme.

During the year, the Foundation expanded its work for children with disabilities through its ARISE

programme. This programme is a variant of ARISE in which children with disabilities are provided chronic therapy as well as special education to help them lead more fulfilling lives. Through 25 projects, the programme enabled 2,776 differently-abled students to become better learners and more independent in managing themselves. As the interventions shifted to online mode, 430 students were provided digital tablets to ensure continuity of learning.

SHIKSHAANTAR

Shikshaantar, envisioned as a programme for enhancing capacity of government school teachers, has emerged as an important programme in the education portfolio of the Foundation. TMF works with the Municipal Corporations in East Delhi and North Delhi by running their In-Service Teacher Education Institutes, and during the year under review, as many as 6,378 teachers were trained as part of this initiative. This included specially designed modules for Digital Literacy, Cyber Security and Mental Health that were delivered to the teachers through online sessions.

MOBILE SCIENCE LAB

In order to increase the footprint of its work in education and reach the unreached, TMF launched a unique initiative in 2019-20 - the Mobile Science Lab. For this, a Mahindra bus was remodeled into a science lab on wheels that travelled across schools in East Delhi to provide STEM learning for children in grades 3 and 4. Though the program could not be implemented because of COVID, a second Mobile Science Lab was commissioned through funding received from the National Scheduled Caste Finance & Development Corporation.

EMPLOYABILITY

Skills-for-Market Training (SMART) is the Foundation’s flagship programme in employability. It is built on the vision of an educated, enabled and empowered India, and the belief that educated and skilled youth are the country’s true strength. The programme started with three Centres in 2012 and is currently running over 100 Centres at 11 locations across India. These include SMART Centres, SMART Centres (training for people with disabilities), and SMART-T Centres (training in technical trades).

I n financial year 2020-21, your Company trained 14,394 young women and men under its SMART program, of which, 1,687 were persons with disabilities. Upon successful completion of the course, more than 70% of the graduates are placed in jobs across multiple

industries. A significant achievement for the year was that the average salaries earned by the students increased by over '' 500 per month, despite the severe impact of the pandemic.

The Foundation’s commitment to setting new benchmarks in skill development in India has been underscored by the setting up of Tech Mahindra SMART Academies, which provide the highest quality of skill training to youngsters in Healthcare and Digital Technologies. During FY 2020-21, 1,317 students were enrolled to the four Healthcare Academies in Delhi, Mohali, Mumbai, and Pune, the last of which started functioning in March 2021. In addition, another 710 students were enrolled at the SMART Academies for Digital Technologies in Vizag, Hyderabad and Mohali.

TMF’s work in COVID Relief

As soon as the pandemic broke out in the beginning of the Financial Year, the TMF team shifted its emphasis towards carrying out relief activities for those who were the hardest hit - daily wagers, migrant workers, farmers, persons with disabilities and the transgender community. Through a structured and efficient intervention, the Foundation distributed nearly 6 lakhs ration kits, 3.20 lakhs cooked meals, PPE kits, masks, and medical equipment to hospitals. In all, relief efforts worth '' 14.82 crores were carried out over the year that continued into the current financial year as well. Till date, over 20 lakhs people have benefitted through these efforts.

MAHINDRA EDUCATIONAL INSTITUTIONS (MEI)

MEI - a not-for-profit, 100% subsidiary of the Company has set up Mahindra Ecole Centrale in August 2014 - through a collaborative venture between Mahindra Educational Institutions and Ecole Centrale of Paris, France (now known as Centrale Supelec) and the JNTU Hyderabad - to offer undergraduate engineering programs. Through this strong Indo-French Collaboration with Centrale Supelec and Industry connect with Tech Mahindra, MEC has emerged as a disruptive player in the field of Technical Education.

MEI has sponsored the setting up of Mahindra University to introduce diverse streams of education in addition to Engineering.

MAHINDRA UNIVERSITY

Mahindra University (MU) was notified by the Government of Telangana vide Telangana Ordinance No. 1 of 2020 dated 20th May 2020 as per the

Telangana State Private Universities (Establishment and Regulation) Act, 2018 for "educating future citizens for and of a better world”.

Mr. Anand Mahindra, Chairman of the Company and the Mahindra Group is the Founding Chancellor of the University and he believes that Professional Courses have the greatest potential to contribute to economic inclusivity and sustainable development.

The University will drive a meaningful shift in the way we deliver higher education, besides focusing on infusing emerging technologies into the education space, it will drive interdisciplinary academic excellence, integrating science technology, humanities, ethics, philosophy and design, with purpose. It will also stress on developing multiskilled leaders, who are ethical and empathetic, and capable of reflection as well as innovation.

The University is India’s first to leverage AI & EI (artificial & emotional intelligence) for both education as well as collaboration, across the board.

Besides the existing programs in Civil Engineering, Computer Science Engineering, Electrical & Electronics Engineering, and Mechanical Engineering, the Ecole Centrale School of Engineering is offering 4-year UG programs of study in Electronics & Computer Engineering, Artificial Intelligence, and Computation and Mathematics from academic session 2020-21.

In the 2020 academic session, 657 students were admitted to the University in UG engineering programs, including 42 students in the PhD program in Engineering. Due to constraints imposed by the pandemic, classes had to be held online for most of the academic session.

The University started its accreditation process with submission of requisite documentation to the National Board of Accreditation for the four UG programs in CSE, EEE, Civil and Mechanical Engineering.

The Annual Report on CSR activities is provided as “Annexure VIII”.

SUSTAINABILITY

The pandemic has reinforced the fact that a focused sustainable strategy is needed for business continuity and profitable growth. All businesses have a critical role to play as a source of finance, driving innovation, and ensuring economic growth and employment.

materials. Spread awareness and initiate campaigns on preventing single-use plastic

• Reduce, Reuse, Recycle, Recover: Implement process of Reduce, Reuse, Recycle and Recover across the value chain to limit waste and enable a circular economy

• Sustainable supply chain: Ensure our suppliers follow the highest standard of sustainable and ethical best practices; optimise logistics and transportation to reduce emissions

• Work-life balance: Provide an assured career development path and a feasible and flexi work-life balance to our associates along with a range of associate-friendly policies and processes

• Innovation: Becoming future ready by proactively encouraging Innovative thinking across the organization, adopting technology disruption to reduce emissions and going digital. Developed sustainable solutions with technologies like loT, Automation, Blockchain and AI in sustainability that will help enable a pathway to reduce emissions and other impacts of climate change.

• Green solutions: Investing in Smart grid, Microgrid-As-A-Services, Community Action Platform for Energy, Integrated Electric Vehicle Charging systems, Smart data hubs and Smart Cities for our Customers to reduce their emissions

• Individual Social Responsibility: encourage associates in making sustainability a part of their daily lives even while working from Home

• Transparency: Showcase our organizational policies, processes, risk management along with financial, environmental and social data in the Integrated Reports available online

The commitment and performances are validated by

the external recognition the Company received:

> The only Indian company to be listed in Carbon Clean 200 by Corporate Knights and As You Sow

> The only Indian IT company to score double ‘A’ in CDP Climate and CDP Water

> Included in the Climate Disclosure Project (CDP) Supplier Engagement Leaderboard 2020

The environment, social and governance (ESG) principles built-in the Tech Mahindra long-term growth strategy have helped to mitigate risks and drive profitable growth even in this crisis situation. Adopting resilient strategies and sustainable transformation with a focus on low carbon future have helped the Company to quickly adapt to disruptions and leverage the processes towards Business continuity. The Company’s commitment to environment sustainability, climate change and water security spans the entire business. As a Company with a purpose, it has delivered on its promise to run better, change faster and grow greater while also creating meaningful human experiences for all. The Cpmpany is pursuing plans that will have long-term impacts on the planet and communities, leading to a balance between sustainability and overall business profitability.

With a structured stakeholder engagement process, Tech Mahindra has been able to design strategies and initiatives, which not only improves our sustainability credentials but also reinforces its overall business philosophy. The Company is breaking through new frontiers, turning to renewable energy to achieve ecological balance while ensuring that when it comes to investments, the Company is pioneering new solutions for sustainable development. Your Company emphasis on green eco-system is seen through its commitment to going carbon neutral, making optimum use of resources and moving towards a low emission technology. The profitability of the Comopany is aligned with its principles, allowing to set sustainability milestones on its journey toward a secure future.

Your Company is aligned to the SDGs (Sustainable Development Goals) and its sustainability focus areas are as below:

• Going Carbon Neutral: Increase use of renewable energy through onsite installation and open access; improve energy efficiency through installation of LEDs, sensors; boost green investments by implementing Carbon Price; optimize business travel by enabling virtual meetings; encourage use of public transport and carpool to reduce commute emissions; plant trees to offset carbon footprints; move towards a low carbon economy ensuring environmental protection

• Saying No to plastic: Maintain plastic-free campuses and encourage associates and stakeholders to use eco-friendly & biodegradable

> One amongst only 3 companies from India to be in DJSI World Index 2020

> One of only 11 Indian Companies in DJSI Emerging Markets 2020

> Only Indian company recognized amongst the ‘2021 Global 100 Most Sustainable Corporations’ by Corporate Knights

> Scored A and included in the top 5 of India’s most Sustainable companies by Business World in collaboration with Sustain Labs Paris

> Awarded Gold rating with 94 percentile in 2020 by ECOVADIS

> Constituent of FTSE4Good Index 2020 by Financial Times Stock Exchange-Russell Group

> Winner of Mahindra Group Sustainability Performance Award 2020

> Leaders with 99 percentiles in SUSTAINALYTICS

The Integrated Annual Report is based on various global standards and frameworks like TCFD (Taskforce on Climate Related Financial Disclosures), CDSB (Climate Disclosure Standards Board), SASB (Sustainability Accounting Standard Board) and GRI standards and assured by third party according to ISAE International Standard on Assurance Engagement) 3000 standard.

Tech Mahindra discloses climate-related risks and opportunities in line with the recommendations of TCFD which focusses on the financial impact of climate-related changes on our operations.

The TechM Board is accountable for all risks and opportunities. The MD and CEO of the Company chairs the CSR Committee of the Board and has the ultimate responsibility for Sustainability. He is ably supported by the Chief Sustainability Officer who directly reports to him and Senior Management members of the Sustainability Council who manage all aspects of climate change including climate-related risks and opportunities.

The pandemic has made it imperative to make this a time of change and a time of learning. Your Company embed sustainability into COVID-19 economic recovery, implement their promises and stretch

its commitments to provide for a better and more sustainable future. Tech Mahindra is committed to the SDGs and is transitioning to a low-carbon economy to achieve the goals of Paris agreement. The strategy includes futureproofing its growth against impending changes in policies and regulations and increasing its compliance readiness. The Company is agile and adaptive to dynamic changes in internal and external environment with strategies in place to manage all business and climate change risks in an effective way. The Company has a robust business continuity management framework and incident response team that ensure it is resilient to any climate change risks.

The targets and the metrics used for managing climate related risks and the progress against these targets are disclosed in the externally assured Integrated reports available here- https://www.techmahindra. com/en-in/sustainability/

AWARDS AND RECOGNITION

Your Company continued its quest for excellence in its chosen area of business to emerge as a true global brand. Several awards and rankings continue to endorse your Company as a thought leader in the industry. Few of the Awards / recognitions received by the Company during the year 2020-21 include:

• Tech Mahindra ranked 10th - winner of ATD Best Award in the ‘Other - IT’ category

• Tech Mahindra won Gold Stevie and Bronze Stevie at "2020 Stevie Awards for Great Employers”

• Tech Mahindra’s Mhealthy won ETHealth Award for Best Technology Solution for COVID-19

• Tech Mahindra amongst 50 best workplaces for women by the Great Place to Work Institute.

• Tech Mahindra recognized amongst ‘India’s Top 20 Companies for Sustainability and CSR 2020’ by The Economic Times and Futurescape 7th Responsible Business Rankings during ETSDG Impact Summit 2020.

• Tech Mahindra recognized as a leader in 2020 Gartner Magic Quadrant for IT Services for communications service providers, worldwide.

• Tech Mahindra has featured amongst the Top 10 "Best Companies for Women in India (BCWI)” by Avtar and Working Mother for the third year in a

row and declared ‘Champions of Inclusion’ in the most inclusive companies of India Index.

• Mr. C. P. Gurnani recognized as ‘The Technology Icon of India’ by VARINDIA Brand book on ICT industry.

• Tech Mahindra featured in Fortune India 500 most valuable firms.

• TMF is a winner for the category ‘Best Corporate Foundation COVID-19 Relief Project [Large Impact]’ at the 9th India CSR Awards 2021.

• Tech Mahindra’s Surveillance Solution for Kanpur Smart City is amongst the winners at FICCI India Smart Urban Innovation Awards 2021.

• Tech Mahindra amongst Forbes Top 50 Organizations in Blockchain for 2021.

• Tech Mahindra recognized as a Leader in Gartner 2021 Magic Quadrant for Customer Service BPO.

ACKNOWLEDGEMENTS

Your Directors place on record their appreciation for the contributions made by employees towards the success of your Company more particularly ensuring business as usual in spite of COVID-19 impact. Your Directors gratefully acknowledge the co-operation and support received from the shareholders, customers, vendors, bankers, regulatory and Governmental authorities in India and abroad.

For and on behalf of the Board

Anand G. Mahindra Place: Mumbai Chairman

Date: April 26, 2021 (DIN: 00004695)


Mar 31, 2021

DIRECTORS’ REPORT

Your Directors present Thirty Fourth Annual Report together with the audited accounts of your Company for the year ended March 31, 2021.

FINANCIAL RESULTS (STANDALONE)

('' in Million)

For the year ended March 31

2021

2020

Income

305,627

315,916

Profit Before Interest, Depreciation and Tax

62,521

60,663

Interest

(632)

(667)

Depreciation

(6,623)

(6,674)

Profit Before Tax

55,266

53,322

Provision for Taxation

(12,875)

(7,977)

Profit After Tax

42,391

45,345

Other Comprehensive Income

2,453

(3,234)

Balance brought forward from previous year

184,021

171,952

Transition impact of Ind AS 116, net of tax

-

(78)

Balance

184,021

171,874

Profit available for appropriation

226,432

217,130

Equity Dividends (Including tax on Dividends)

(19,335) 2

(27,522)1

Transfer to retained earnings on account of options lapsed

96

59

Others

-

26

Transferred to Special Economic Zone re-investment reserve (net of utilisation)

(6,319)

(5,540)

Buyback of equity shares (refer note 18(v))

-

(132)

Balance carried forward

200,874

184,021

1 Interim Dividend for the financial year ended March 31, 2020 and Final Dividend for the financial year ended March 31, 2019

2 Interim Dividend (Special Dividend) for the financial year ended March 31, 2021 and Final Dividend for the financial year ended March 31, 2020

DIVIDEND

The Board of Directors on October 23, 2020 approved a special dividend of '' 15/- per equity share (i.e. 300%) on par value of '' 5/- each which was paid by the Company to the shareholders whose names were appearing in the Register of Members as on November 2, 2020 being the record date for the payment of dividend. Your Directors are pleased to recommend a final dividend of '' 30/- per share (including a special dividend of '' 15/-per share) on par value of '' 5/- (i.e. 600%), payable to those Shareholders whose names appear in the Register of Members as on the Book Closure Date. Thus, the total dividend for the Financial Year 2020-21 will be '' 45/- per share (i.e. 900%) as against '' 15/- per share (i.e. 300%) in the Financial Year 2019-20.

Your Company has formulated a Dividend Policy which is disclosed on the website of the Company at https:// insights.techmahindra.com/investors/tml-dividend-distribution-policy.pdf

SHARE CAPITAL

During the year under review, your Company allotted 2,407,703 equity shares on the exercise of stock options under various Employee Stock Option Schemes. Consequently, the issued, subscribed and paid-up equity share capital has increased from '' 4,829 million divided into 965,852,364 equity shares of '' 5/- each to '' 4,841 million divided into 968,260,067 equity shares of '' 5/- each.

BUSINESS PERFORMANCE / FINANCIAL OVERVIEW

The Company provides connected experiences, offering innovative and customer-centric information technology experiences, enabling Enterprises, Associates and the Society to Rise™. The Company has over 121,000 professionals in over 90 countries, helping 1,007 global customers including many Fortune 500 companies. The Company’s convergent, digital, design experiences, innovation platforms

and reusable assets connect across a number of technologies to deliver tangible business value and experiences to stakeholders. Your Company also focuses on sustainable business strategy, managing social and environmental impacts, while ensuring that corporate decisions lead to an equitable growth. As a result, Tech Mahindra is one of the three companies from India to be included in the DJSI World Index 2020 and one of the eleven Indian companies in the Emerging markets category.

During the Financial Year 2020-21, the Company’s consolidated revenues increased to '' 378,551 million from '' 368,677 million in the previous year, a growth of 2.7%. The geographic split of revenue is 47.5% from the Americas, 26% from Europe and 26.5% from the Rest of the World.

The consolidated Profit (including other income) before Interest, Depreciation and Tax was at '' 75,846 million, against '' 66,955 million in the previous year.

The consolidated Profit after Tax amounted to '' 43,530 million as against '' 38,974 million in the previous year.

In an age of regular technological disruption, Tech Mahindra is delivering value to its customers with its domain expertise and wide range of offerings in blockchain, machine learning, artificial intelligence, cloud, cyber security, quantum computing and IoT combined with an intimate understanding of each customer and their objectives. The Company has collaborated with industry leaders and startups, academia and partners under TechMNxt charter to provide customized yet simplified solutions for customers.

IMPACT OF COVID-19

The COVID - 19 pandemic that began in Q4 of FY 2019-20, continues to impact people globally, causing healthcare crisis, impacting economies and businesses at large. Economic activity took a backseat as most efforts were channelized in strengthening health infrastructure and supporting weaker sections of the economy. The Company did witness impact in several of its clients, as organizations resorted to cash conservation and reduction of discretionary spending. This impacted demand in the first half of Financial Year 2020-21. Your Company undertook several initiatives to ensuring safety of its people, assets and communities at large. The Company deployed business continuity plans ensuring continues service to customers throughout these tough times. Your

Company realigned its strategy, modified the delivery model and crafted solutions focused on enabling the clients to imagine the future of their business, building and running it for them. This led to a robust demand in the second half of the year, as your Company helped adopt massive technological changes and new business models.

ACQUISITIONS

CERIUM

The Company on April 9, 2020 acquired 51% of the share capital of Cerium Systems Private Limited (Cerium). The enterprise value of Cerium is '' 2,450 million. Cerium is an integrated circuit and embedded software design service provider that is expected to help bolster Tech Mahindra’s capabilities in the areas of semiconductor design and testing, embedded software development / testing and product engineering. The remaining 49% to be acquired over the next three years at a valuation linked to the financial performance of Cerium. During the year, the Company acquired a further 6% stake thereby taking the total shareholding to 57%.

ZEN3

The Company on April 9, 2020, acquired 100% of the share capital of Zen3 for a cash consideration of USD 64 million, out of which USD 35 million was paid upfront, USD 4 million will be paid over two years and maximum upto USD 25 million will be paid over three years linked to financial performance. Zen3 is leading software solution group with strong capabilities in AI enablement services, AI speech solutions, cloud engineering, software product engineering and DevOps. Zen3 has more than 1,300 employees across offices in Seattle, Dublin, Bengaluru, Hyderabad and Vishakhapatnam.

TENZING

The Company acquired 100% of the share capital of Tenzing Ltd and Tenzing Australia Ltd (Tenzing Group) through its wholly owned subsidiary Tech Mahindra (Singapore) Pte Ltd at a consideration of USD 29.5 million including earnouts. The Company is headquartered in Auckland, New Zealand and is engaged in the business of Management Consulting, Digital Transformation and Technology services. It has 145 employees and a turnover of USD 27.4 million. The acquisition will bring strong capabilities primarily in the Insurance vertical along with expanding footprint in the Australia and New Zealand (ANZ) market. The acquisition was completed on December 1, 2020.

MOMENTON

Momenton Pty. Ltd. ("Momenton”) was acquired by the Company through its wholly owned subsidiary viz., Tech Mahindra (Singapore) Pte Limited at a consideration upto AUD 14.3 million including earnouts. The company is headquartered in Melbourne, Australia and has approximately 55 employees. Turnover for the financial year ended 30th June 2020, was AUD 10.8 million. Momenton is a cloud and engineering services provider with a Banking and Financial Services (BFS) focus. The acquisition will enhance Tech Mahindra’s digital transformation capabilities and provide Tech Mahindra a scaled-up presence in the Australian BFS market. This acquisition was completed on 12th February 2021.

PERIGORD

The Company acquired 70% of Perigord Asset Holdings Limited ("Perigord”) through its wholly owned subsidiary Mahindra Engineering Services (Europe) Ltd at a consideration of EUR 21 Million and the remaining 30% will be acquired over the next four years at a valuation linked to financial performance of the company. Perigord is headquartered in Dublin, Ireland with a presence in Germany, USA and India with 380 employees. For the financial year ending 31st December 2020, the company had revenue of EUR 19.5 million The Indian subsidiaries of Perigord were acquired by the Company directly.

Perigord specialized in end to end packaging supply chain solutions to the life sciences industry with services such as packaging artwork & labelling services, strategic consultancy, creative and digital, strategic outsourcing, managed services and software solutions. The acquisition was completed on 15th March, 2021.

PAYMENTS TECHNOLOGY SERVICES LIMITED

The Company announced the acquisition of Payments Technology Services Limited, Hongkong on 12th January 2021 at a consideration of USD 9 million. The company is headquartered in Hong Kong and has approximately 109 employees. Turnover of the Company for the financial year ended 31st December 2019 was USD 5.4 million.

The Payments Technology Services entity is a step-down subsidiary of Fidelity Information Services (FIS). The acquired capabilities in the payments space will give us access to IPs and licenses for two products, which is consistent with the strategy of

pivoting the business towards products and platform implementations as well as participating in the banking transformation programs. This acquisition will open up other opportunities for Tech Mahindra across a number of areas in partnership with FIS.

DIGITALONUS

The Company announced the acquisition of DigitalOnUs, Inc. ("DigitalOnUs”) on 19th April 2021 at an enterprise value of USD 120 million through its wholly owned subsidiary, Tech Mahindra (Americas) Inc. The company is headquartered in San Jose, California, USA. DigitalOnUs is focused on Cloud Native Development and Hybrid Cloud Automation services. The acquisition of DigitalOnUs will enhance Tech Mahindra’s capability in cloud native engineering and position it to develop cutting-edge digital solutions for its customers. DigitalOnUs has more than 380 employees. For the financial year ending 31st December 2020, the company had revenue of USD 30.6 million. The Indian subsidiary of DigitalOnUs namely DigitalOps Technology Private Limited has been acquired by the Company.

EVENTUS

The Company announced the acquisition of Eventus Solutions Group, LLC. ("Eventus”) on April 26, 2021 through its wholly owned subsidiary Tech Mahindra (Americas) Inc. at a consideration of USD 44 million. Eventus provides end-to-end customer engagement solutions, such as strategy consulting, cloud based tools and automation services and managed services. The company is headquartered in Denver, Colorado. It has a turnover of USD 33.2 million in CY2020, with an employee base of around 100 spread across various states in the US.

The acquisition of Payment Technology Services Ltd, DigitalOnUs and Eventus are yet to be consummated on the date of this report.

DETAILS OF SUBSIDIARIES / JOINT VENTURES / ASSOCIATE COMPANIES

The performance and financial position of the subsidiaries, associate companies and joint venture companies included in the consolidated financial statement is provided in accordance with the provisions of Section 129 read with Rule 5 of the Companies (Accounts) Rules, 2014 containing the salient features of the financial statement of Company’s subsidiaries/joint ventures or associate companies in Form AOC - 1 in “Annexure I” to this report.

Pursuant to Rule 8(5)(iv) of the Companies (Accounts) Rules, 2014, the names of the companies which have been incorporated or ceased to be the subsidiaries, joint ventures or associate companies during the year are provided in “Annexure II” to this report. The Company is actively pursuing the initiative on consolidation of its subsidiaries/branches to optimise the operational costs. During the year under review, your Company has closed/merged Eight subsidiaries.

In terms of the provisions of Regulation 24 of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, Tech Mahindra (Americas) Inc. is a wholly owned unlisted material subsidiary of the Company.

The policy for determining material subsidiaries formulated by the Board of Directors is disclosed on the Company’s website and is accessible on https:// insights.techmahindra.com/investors/Policy-For-Determining-Material-Subsidiaries.pdf

UPDATE ON MERGER

The Board of Directors at its meeting held on January 31, 2021 approved the Scheme of Merger of Tech Mahindra Business Services Ltd and Born Commerce Private Ltd with the Company. Accordingly, the companies filed the applications before Hon’ble National Company Law Tribunal (NCLT), Mumbai and Chennai Benches respectively. The applications are pending for admission as on the date of this Report.

HUMAN RESOURCES

Your Company has taken several initiatives in the development of human resources, the most important asset of the Company. Some of the initiatives taken in this area are -

Wellness: Putting Well-being at the Forefront

Since 2017, your Company has been leading a unique corporate wellness program called "Wellness Before Business” that has helped prioritize health as the foundation of its associates’ professional, personal, and spiritual well-being. Your Company was able to adapt faster to the challenges of the COVID-19 pandemic, with all actions aligned to this belief. It also gave birth to the mantra of #WellnessFirst and encouraged mental & virtual connect amongst teams while remaining physically apart. Your Company launched the AMIGO Program for holistic emotional and mental wellness for associates and their dependents. Your Company conducted daily health sessions for mental (psychological experts with byte sized videos), emotional (stay connected virtually while

maintaining social distance) and physical (how to stay healthy and fit) wellness. By transitioning to virtual wellness services, daily sessions with experts and incentivizing wellness benefits, your Company has encouraged its associates stay distant, yet connected.

Pandemic: Enabling Work from Home

Your Company was amongst the first to publicly express the need for staying distant and being safe with a logo tweak, the "e” in "Tech Mahindra” being boxed inside a home. Your Company formed Rapid Action Task forces at different locations for business continuity and enabling work from home. These teams helped in collaborating with government authorities, complying with health advisories, implementing best practices like travel restrictions and defining local emergency protocols. Your Company also rolled out several new policies like Remote Workstation set up, Laptop Rental, Special COVID-19 Leave Benefit, Insurance cover for Home Quarantine and Vaccination Cost Reimbursement to support working from home. Associates were also provided with infrastructure support for networking and security requirements. To make associates and managers accustomed to working from home, the WFH101 program was launched within a week of the lockdown. These activities enabled over 90% of associates to work from home productively within 72 hours of the government’s lockdown announcement.

Leadership: Peacetime Leaders to Wartime Generals

The COVID-19 pandemic changed the leadership paradigm and style of functioning. Your Peacetime Leaders became Wartime Generals. Like in war, one does not have the luxury of time to mull over decision making, the pandemic called for leaders to become agile, think fast and act faster. It meant being focused and yet open to revisiting strategies, taking bold risks, judiciously deploying resources and above all, working tirelessly till the war was won! This new model of ‘Wartime Generals’ is what your Company sought to create. These new leaders helped rally their teams, kept the team engaged and communicated clear, crisp messages frequently while challenging conventional thinking. Your Company has launched a real-time Performance Management System for its top 300 leaders to drive a high-performance culture which ensures that key business initiatives and leaders’ goals are in-sync and tracked regularly. Your Company has also setup five transformation offices and identified 36 strategic initiatives along with output metrics, targets and RACI.

Communication: Frequent, Transparent and Empathetic

With associates working from home, your Company faced natural challenges in ensuring that a distributed workforce stayed connected. Your Company communicated with urgency, transparency and empathy to help associates adjust to the constantly changing conditions crises bring and to maintain a single source of truth. Your Company created a live microsite to prioritize consistent and continuous communication. Your Company launched a daily newsletter called TechM Coronicles that included a video message from a leader, inspirational stories, clarification of rumours, training calendars, associate engagements and customer kudos. Additionally, a new connect series called PrimeTime was introduced to keep associates updated and inspired by external speakers. This was a daily one-hour virtual connect and it featured global leaders from a cross section of industries including Sports, Cinema and Politics. There were close to 150 episodes of Primetime over the course of the year.

Engagement: lovetobeTechM has no boundaries

Your Company used connected technologies to create meaningful experiences for associates working remotely and organized several collaborative activities that included their families. Through the "Each One House One” initiative associates welcomed their colleagues from their neighborhood into their homes. Your Company also facilitated the return of approximately 2000 associates and their families who were stranded abroad through repatriation flights.

Rewards: Nurturing A Culture of Giving

Your Company and its associates believe in driving positive change especially the vulnerable communities impacted during pandemic through individual and Company social responsibility. Last year associates donated ''1.5 million towards social causes - a 105% increase over the previous year. Associates also helped vulnerable communities through voluntary services like grocery/grain distribution, tree plantation and community drives, taking care of migrant workers, donating PPE kits / medical supplies etc. Your Company also facilitated the screening of around 10,000 third-party vendors, associates and members of the partner ecosystem including those working in pantry, sanitation and security departments through the Mhealthy platform. Mhealthy was launched in July 2020 with 32 screening tests, risk profile, access to medical care, antibody test for COVID-19 to secure the workplace. Through these numerous measures,

your Company has continued to recognise the extra ordinary resilience shown by associates through its digital platform that nurtures appreciation and social sharing.

Hiring: Reversing the pyramid

Your Company has taken proactive steps to introduce young talent that will thrive in the ‘new normal.’ With the launch of new programs like LEAP and ELEVATE, your Company gives fresh graduates the flexibility of remote work from home. These programs in addition to the existing ELITE Engineering graduate hiring, Management Trainee program (for hiring fresh talent from B-schools) and Global Leadership Cadre program (for fast-tracking the growth of young leaders) help your Company reverse the pyramid. Your Company has also expanded the use of the #NewAgeDelivery platform in the hiring process by checking for internal talent that are to be released from projects or those already on the bench so as to reduce external hiring costs.

Learning: Becoming Fit4Future

During the year virtual learning picked up momentum as your Company prioritized re-skilling and upskilling through the NAD Learn (formerly Upskilling as a Service) platform. This self-learning ecosystem has offered more than 55,000 associates the opportunity to become full-stack/ full cycle professionals. 20,000 associates are engaged in the RIDE Future Skilling program that is helping your Company transition to new age technologies. Your Company launched EMBARK to train 500 Program Managers on ten special competencies. The top 300 Leaders who completed the Chrysalis program last year had a special 3-month development journey to help them lead during this unprecedented time. Your Company has also helped 400 customers across 31 countries prepare for a post COVID-19 world by sharing best practices and learning content.

Diversity: Creating a sense of Belonging

Your Company reinforced its commitment to being intentionally diverse by becoming a signatory of UN Women and a part of the WEP (Women’s Empowerment Principles) Community. The Women Leaders Program has helped your Company identify more than 50 trailblazers who can drive future business in the ‘new normal.’ Focussed efforts were made towards generational diversity as young leaders were developed through programs like AIM, Ascend and Transcend.

QUALITY

The Company continues its focus on quality and strives to exceed customer expectations at all times. During the year, it continued to strengthen the implementation of CMMI Dev v1.3 (Capability Maturity Model Integration) Dev v1.3 (Capability Maturity Model Integration) (Development) for which the organization is assessed at L5. Similarly it underwent various upgrade and continuous evaluation audits for multiple standards during the year in order to meet client demands and enhance value delivery - Successfully assessed for, CMMI Dev v 1.3, Level 5, ISO 9001:2015 (Quality Management System), ISO 20000-1:2018 (Information Technology Service Management System), ISO 27001:2013 (Information Security Management System), TL9000 R 6.2/ R5.6 (Quality Management Systems for Tele Communications industry), ISO 13485:2016 (Quality Management Systems for medical devices - scope of certification limited to medical devices business within Tech Mahindra), AS9100 Rev D (Standard for Aerospace domain - scope of certification limited to the aerospace business within Tech Mahindra).

In addition to these, your Company also maintains its commitment to health, safety and environment by continually improving its processes in accordance with ISO 14001:2015 (Environmental Management System) and ISO 45001: 2018 (Occupational Health and Safety Assessment Series) standards. Your Company is also certified on ISO 22301:2012 (Societal Security and Business Continuity Management System) and has a comprehensive Business Continuity and Disaster Recovery framework, to prevent potential business disruptions in the event of any disaster. It has processes that helped resume services to customer’s acceptable service levels. Automated Service Desk with SLAs for enabling business and Vulnerability Assessment and Penetration Testing Lab for secured corporate network operations are highlights that showcase the information security posture of the Organization.

During the pandemic year, the entire quality management system was put to test, associates were working from home while complying with all security requirements and able to deliver the services to the desired quality as per customer contractual commitments.

Tech Mahindra (IT Division) has been assessed for the implementation of high maturity business excellence practices at Mahindra Group (Services Sector). It has

been assessed at TMW Maturity Stage 6 (on scale of 1-10 stages) of Mahindra Business Excellence Framework - The Mahindra Way. These certifications are testimony of the robustness of business processes and at large the quality culture imbibed in the organization.

Your Company has continued to strengthen the process for transforming Quality Assurance processes & delivery methods to New Age Delivery processes through the #NewAgeDelivery Engine. This engine focuses on asset creation and re-usability, enabling associates to be rightly skilled through Upskilling as a service, enabling projects and programs to deploy smart planning and crowd sourcing through Capability as a service, providing an automated workflow environment for the associates to execute the project seamlessly through Digital inside and Continuous Delivery. All of this has lead to better customer experience and faster quality delivery. This engine is further strengthened with command center view for the programs and units to access their realtime performance against the targets. Moreover the system is enabled with automated signals and alerts when the performance breaches the threshold for the owner to take corrective actions. The Company is putting all these initiatives in place to ensure that it deliver as stated in its Quality Policy.

DIRECTORS

During the year under review, all Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Independent Directors have also given declaration of compliance with Rules 6(1) and 6(2) of the Companies (Appointment and Qualification of Directors) Rules, 2014, with respect to their name appearing in the data bank of Independent Directors maintained by the Indian Institute of Corporate Affairs.

Pursuant to the provisions of Section 152(6)(c) of the Companies Act, 2013, Dr. Anish Shah is liable to retire by rotation and offers himself for reappointment.

Dr. Anish Shah (DIN: 02719429) who was appointed as an Additional Director with effect from September 10, 2019 has been appointed as Director of the Company at the Annual General Meeting held on July 28, 2020.

Your Directors co-opted Mr. Manoj Bhat (DIN: 05205447) as an Additional Director with effect from 2nd April 2021 whose term will end at the ensuing Annual General Meeting and being eligible offers himself for appointment.

Mr. V.S. Parthasarathy, (DIN: 00125299) resigned as director of the Company with effect from 31st January 2021. Your board places on record its sincere appreciation for the valuable services rendered by Mr. Parthasarathy to the Company during his tenure.

In terms of Regulation 24(1) of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, Mr. T. N. Manoharan, Independent Director of the Company has been appointed as Director in Tech Mahindra (Americas) Inc., a Wholly owned unlisted material subsidiary of the Company with effect from May 21, 2019.

Mr. T. N. Manoharan was also appointed as Lead Independent Director by the Board of Directors at its Meeting held on April 26, 2021.

In the opinion of the Board of Directors the Independent Directors have relevant proficiency, expertise and experience.

FAMILIARISATION PROGRAMME

These programmes aim to provide insights into the Company to enable the Independent Directors to understand its business in depth and contribute significantly to the Company. The details of program for familiarisation of the Independent Directors with the Company are available on the Company’s website and can be accessed at; https://insights. techmahindra.com/investors/tml-familarisation-progarmmes-for-IDs.pdf

The Board members are also regularly updated on changes in the statutory provisions like changes in Corporate Laws, SEBI Regulations, Taxation Laws and People related laws as applicable at the quarterly Board meetings. The Board members are also updated on the Risk universe applicable to the Company’s business. The MD & CEO of the Company had a quarterly session with Board members sharing updates about the Company’s business strategy, operations and the key trends in the IT industry that are relevant for the Company. These updates help the board members in keeping abreast of the key changes and their impact on the Company.

BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and Regulation 19 read with Schedule II, Part D of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has devised a policy on evaluating the performance of the Board of Directors, the Chairman, Committees, and Individual Directors. The evaluation process was carried out through a web-based portal. The summary of the evaluation reports was presented to the respective Committees and the Board. The Directors had a positive feedback on the overall functioning of the Committees and the Board. The suggestions made by the Directors in the evaluation process have been suitably incorporated in the processes.

NUMBER OF MEETINGS OF THE BOARD

The Board met seven times during the financial year 2020-21. The meeting details are provided in Corporate Governance report that forms part of this Annual Report. The maximum interval between any two meetings did not exceed 120 days as prescribed in the Companies Act, 2013 and SEBI Listing Regulations.

POLICY ON DIRECTORS’ APPOINTMENT AND REMUNERATION

The Governance policies laid down by the Board of Directors of your Company include:

i. Policy on appointment and removal of Directors, Key Managerial Personnel and Senior Management.

ii. Policy on remuneration to the Directors, Key Managerial Personnel and Senior Management and other Employees.

The extract of these two policies are provided in “Annexure III”.

The policies are available on the Company’s website on https://insights.techmahindra.com/investors/ Governance-Policies-including-remuneration-to-Directors-KMPS.pdf

SUCCESSION PLAN

In accordance with the principles of transparency and consistency, your Company has adopted governance policies for its Board of Directors, Key Managerial Personnel & senior management appointments, remuneration and evaluation. In line with these Governance policies, the Company has

established a formal Succession Planning Program for key managerial persons across the organization. The Board evaluates all such plans at a regular intervals and institutes a formal program for filling any such critical position. The Board evaluates both internal and external candidates for such positions alongwith the recommendations of the Company. The Company also has a leadership development program where it identifies high potential managers, and trains them to take up the positions of higher responsibilities. The Company has identified the second line of leadership, which provides stability to the business in any contingencies.

TRAINING

The Company has laid down a policy on training for Independent Directors, as part of the governance policies. The Senior Leadership of the Company update the Directors on the regulatory changes, Business strategy and operations periodically.

KEY MANAGERIAL PERSONNEL (KMP)

Pursuant to provisions of Section 203 of the Companies Act, 2013, Mr. C. P Gurnani, Managing Director & Chief Executive Officer, Mr. Manoj Bhat, Chief Financial Officer and Mr. Anil Khatri, Company Secretary & Compliance Officer were the Key Managerial Personnel of the Company during the year under review. Mr. Milind Kulkarni was appointed as Chief Financial Officer of the Company w.e.f. 2nd April 2021.

DIRECTORS’ RESPONSIBILITY STATEMENT

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

i. in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

ii. they have, in the selection of the accounting policies, consulted the Statutory Auditors and these have been applied consistently and, reasonable and prudent judgments and estimates have been made so as to give a true and fair view of the state of affairs of the Company as at March 31, 2021 and of the profit of the Company for the year ended on that date;

iii. proper and sufficient care had been taken 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 other irregularities;

iv. the annual accounts have been prepared on a going concern basis;

v. they had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively;

vi. the proper systems to ensure compliance with the provisions of all applicable laws are in place and are adequate and operating effectively.

DETAILS WITH RESPECT TO ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS

The Company has internal financial controls which are adequate and were operating effectively. The controls are adequate for ensuring the orderly and efficient conduct of the business, including adherence to the Company’s policies, the safe guarding of assets, the prevention & detection of frauds & errors, the accuracy and completeness of accounting records and timely preparation of reliable financial information.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS / PROCEEDINGS

There are no significant and material orders passed by the regulators or courts or tribunal impacting the going concern status and the Company’s operations in the future.

Further no application against the Company has been filed or is pending under the Insolvency and Bankruptcy Code, 2016, nor the Company has done any one time settlement with any Bank or Financial institutions.

STATUTORY AUDITORS

The members, in the 30th Annual General Meeting held on August 1, 2017, appointed B S R & Co. LLP, Chartered Accountants, [Firm’s Registration No. 101248W/W- 100022] as the Statutory Auditors of the Company, to hold office for a term of five years from the conclusion of the 30th Annual General Meeting (AGM) of the Company held in the financial year 201718 until the conclusion of the AGM of the Company for the financial year 2021- 22 on such remuneration as may be determined by the Board of Directors.

The members may note that the Ministry of Corporate Affairs vide notification dated May 07, 2018, has done away with the requirement of yearly ratification of appointment of Statutory Auditors, at the AGM.

Pursuant to Section 139 of the Companies Act, 2013 the statutory auditors B S R & Co. LLP, Chartered Accountants have confirmed that they are eligible to continue as auditors.

There are no qualifications, reservations, adverse remark or disclaimer made in the audit report for the Financial Year 2020-21.

SECRETARIAL AUDIT REPORT

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 had appointed Dr. K. R. Chandratre, Practicing Company Secretary, Pune to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is available at “Annexure IV” to this report. There are no qualifications, reservations, adverse remark or disclaimer made in the Secretarial Audit Report.

COMPLIANCE WITH SECRETARIAL STANDARDS

The Company has complied with the applicable Secretarial Standards.

ANNUAL RETURN

Pursuant to the provisions of Section 92(3) read with Section 134(3) (a) of the Companies Act, 2013, the Annual Return in Form MGT-7 is available at the web link: https://insights.techmahindra.com/investors/mgt7-annual-return-202021.pdf

MANAGERIAL REMUNERATION

Disclosures of the ratio of the remuneration of each director to the median employee’s remuneration and other details as required pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended from time to time, are provided as “Annexure V”.

None of the directors or Managing Director & CEO of the Company, received any remuneration or commission from Subsidiary Companies of your Company.

The details of remuneration paid to the Directors including the Managing Director & CEO of the Company are given in Corporate Governance Report.

PARTICULARS OF EMPLOYEES

The information required under Section 197(12) of the Companies Act, 2013 ("the Act”) read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms part of this Report. However, pursuant to first proviso to Section 136(1) of the Act, this Report is being sent to the Shareholders excluding the aforesaid information. Any shareholder interested in obtaining said information, may write to the Company Secretary at the Registered Office / Corporate Office of the Company and the said information is open for inspection at the Registered Office of the Company.

POLICY ON PREVENTION OF SEXUAL HARASSMENT

Your Company laid down Prevention of Sexual Harassment (POSH) policy which is available on its website. The Company has zero tolerance on Sexual Harassment at workplace. During the year under review there were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

The status of complaints received under POSH and redressed by the POSH Committee of the Company, during the financial year under review, are given below:

a) Number of complaints received - 30

b) Number of complaints redressed - 28

c) Number of complaints pending - 2

The Company carried out focused campaign on POSH and Awareness drives with the help of its BPS teams. Further the employees are required to undertake mandatory certification on POSH to strengthen the POSH awareness and sensitivity.

EMPLOYEE STOCK OPTION SCHEMES

During the year under review, there were no material changes in the Employee Stock Option Schemes (ESOPs) of the Company and the Schemes are in compliance with the SEBI Regulations on ESOPs. As per Regulation 14 of SEBI (Share Based Employee Benefits) Regulations, 2014 read with SEBI circular dated June 16, 2015 the details of the ESOPs are uploaded on the Company’s website; https:// insights.techmahindra.com/investors/Details-of-ESOPs-FY-2020-21.pdf

CORPORATE GOVERNANCE

A report on Corporate Governance covering among others composition, details of meetings of the Board and Committees along with a certificate for compliance with the conditions of Corporate Governance in accordance with the Securities and Exchange Board of India (Listing Obligations And Disclosure Requirements) Regulations, 2015, issued by the Statutory Auditors of the Company, forms part of this Annual Report.

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.

COST RECORDS

Maintenance of cost records and requirement of cost audit as prescribed under the provisions of Section 148 (1) of the Companies Act, 2013 are not applicable for the business activities of the Company.

RISK MANAGEMENT

The Risk Management Committee of the Board of Directors guides the operating management to identify risks, analyze their probability and impact and prepare mitigation plans. It periodically reviews the Risk Management Framework & Enterprise Risk Register which is presented by the Chief Risk Officer. The Company identifies all potential risks, economical, business, currency, operational, climate, governance, financial etc and prepares a mitigation plan for each of the risks. The elements of risk as identified by the Company with the impact and mitigation strategy are set out in the Management Discussion and Analysis Report (MDA).

ESTABLISHMENT OF VIGIL MECHANISM

The Company has laid down Whistle Blower Policy covering Vigil Mechanism with protective Clauses for the Whistle Blowers. The Whistle Blower Policy is made available on the website of the Company.

DEPOSITS / LOANS & ADVANCES, GUARANTEES OR INVESTMENTS

The Company has not accepted any deposits from the public during the year under review. The particulars of loans/advances, guarantees and investments under Section 186 of the Companies Act, 2013 are given in the notes forming part of the Financial Statements.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All transactions entered into with Related Parties as defined under Section 2(76) of the Companies Act, 2013 and Regulation 23 of the Securities and Exchange Board of India (Listing Obligations And Disclosure Requirements) Regulations, 2015, ("The Listing Regulations”), during the financial year under review were in the ordinary course of business and at an arm’s length pricing basis and do not attract the provisions of Section 188 of the Companies Act, 2013. There were no transactions with related parties in the financial year which were in conflict with the interest of the Company and requiring compliance of the provisions of Regulation 23 of the Listing Regulations. Suitable disclosure as required by the Indian Accounting Standards (Ind AS 24) has been made in the notes forming part of the Financial Statements.

The Company has formulated a policy on the materiality of Related Party Transactions and dealing with Related Party Transactions which has been uploaded on the Company’s website and can be accessed at following link https://insights.techmahindra.com/investors/Related-Party-Transactions-Policy.pdf

The particulars of related party transactions in prescribed Form AOC - 2 are attached as “Annexure VI”.

Pursuant to Regulation 23(9) of the Listing Regulations your Company has filed half yearly report on Related Party Transactions with the stock exchanges.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars as prescribed under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 are provided in “Annexure VII” which forms part of this report.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

The CSR vision of the Company is "Empowerment through Education.”

In compliance with the guidelines prescribed under Section 135 of the Companies Act, 2013, your Company has constituted a Corporate Social Responsibility (CSR) Committee of the Board. The CSR policy, covering the Objectives, Focus Areas, Governance Structure Monitoring and Reporting

Framework among others is approved by the Board of Directors. In accordance with the amendments made in Section 135 in January 2021, the CSR Policy has been duly revised and is available at https://files. techmahindra.com/static/img/pdf/csr-policy-techm-v3-march2021.pdf

The Company has spent more than 2% of the average net profits of the Company during the three immediately preceding financial years on CSR. During the year under review, the Company contributed a significant amount towards COVID-19 relief efforts.

The Company’s social initiatives are mainly carried out by Tech Mahindra Foundation and Mahindra Educational Institutions, Section 8 (erstwhile Section 25) Companies promoted by the Company.

TECH MAHINDRA FOUNDATION (TMF)

The Foundation was set up in 2006, as a Section 25 Company (referred to as a Section 8 Company in the Companies Act, 2013). Since then, it has worked tirelessly towards the overarching vision of "Empowerment through Education”, establishing itself as a prominent CSR player within the Mahindra Group as well as a leading social organization at the national level. The Foundation essentially works with children, youth and teachers from disadvantaged urban communities in India, with a special focus on women and persons with disabilities. During the year under review, Tech Mahindra Foundation has successfully implemented 150 high-impact projects with more than 90 partners, directly benefitting 31,767 individuals. In addition, the Foundation reached out to over 1.5 Million people across the country through its COVID Relief efforts.

EDUCATION

The key initiatives in the area of School Education include:

ALL ROUND IMPROVEMENT IN SCHOOL EDUCATION (ARISE)

Tech Mahindra Foundation’s educational initiatives under ARISE are long-term school improvement programmes, in partnership with local governments and partner organisations. The Foundation in 202021 worked with 30 government schools to turn them around into model schools of excellence. Around 6,400 students were covered under this programme.

During the year, the Foundation expanded its work for children with disabilities through its ARISE

programme. This programme is a variant of ARISE in which children with disabilities are provided chronic therapy as well as special education to help them lead more fulfilling lives. Through 25 projects, the programme enabled 2,776 differently-abled students to become better learners and more independent in managing themselves. As the interventions shifted to online mode, 430 students were provided digital tablets to ensure continuity of learning.

SHIKSHAANTAR

Shikshaantar, envisioned as a programme for enhancing capacity of government school teachers, has emerged as an important programme in the education portfolio of the Foundation. TMF works with the Municipal Corporations in East Delhi and North Delhi by running their In-Service Teacher Education Institutes, and during the year under review, as many as 6,378 teachers were trained as part of this initiative. This included specially designed modules for Digital Literacy, Cyber Security and Mental Health that were delivered to the teachers through online sessions.

MOBILE SCIENCE LAB

In order to increase the footprint of its work in education and reach the unreached, TMF launched a unique initiative in 2019-20 - the Mobile Science Lab. For this, a Mahindra bus was remodeled into a science lab on wheels that travelled across schools in East Delhi to provide STEM learning for children in grades 3 and 4. Though the program could not be implemented because of COVID, a second Mobile Science Lab was commissioned through funding received from the National Scheduled Caste Finance & Development Corporation.

EMPLOYABILITY

Skills-for-Market Training (SMART) is the Foundation’s flagship programme in employability. It is built on the vision of an educated, enabled and empowered India, and the belief that educated and skilled youth are the country’s true strength. The programme started with three Centres in 2012 and is currently running over 100 Centres at 11 locations across India. These include SMART Centres, SMART Centres (training for people with disabilities), and SMART-T Centres (training in technical trades).

I n financial year 2020-21, your Company trained 14,394 young women and men under its SMART program, of which, 1,687 were persons with disabilities. Upon successful completion of the course, more than 70% of the graduates are placed in jobs across multiple

industries. A significant achievement for the year was that the average salaries earned by the students increased by over '' 500 per month, despite the severe impact of the pandemic.

The Foundation’s commitment to setting new benchmarks in skill development in India has been underscored by the setting up of Tech Mahindra SMART Academies, which provide the highest quality of skill training to youngsters in Healthcare and Digital Technologies. During FY 2020-21, 1,317 students were enrolled to the four Healthcare Academies in Delhi, Mohali, Mumbai, and Pune, the last of which started functioning in March 2021. In addition, another 710 students were enrolled at the SMART Academies for Digital Technologies in Vizag, Hyderabad and Mohali.

TMF’s work in COVID Relief

As soon as the pandemic broke out in the beginning of the Financial Year, the TMF team shifted its emphasis towards carrying out relief activities for those who were the hardest hit - daily wagers, migrant workers, farmers, persons with disabilities and the transgender community. Through a structured and efficient intervention, the Foundation distributed nearly 6 lakhs ration kits, 3.20 lakhs cooked meals, PPE kits, masks, and medical equipment to hospitals. In all, relief efforts worth '' 14.82 crores were carried out over the year that continued into the current financial year as well. Till date, over 20 lakhs people have benefitted through these efforts.

MAHINDRA EDUCATIONAL INSTITUTIONS (MEI)

MEI - a not-for-profit, 100% subsidiary of the Company has set up Mahindra Ecole Centrale in August 2014 - through a collaborative venture between Mahindra Educational Institutions and Ecole Centrale of Paris, France (now known as Centrale Supelec) and the JNTU Hyderabad - to offer undergraduate engineering programs. Through this strong Indo-French Collaboration with Centrale Supelec and Industry connect with Tech Mahindra, MEC has emerged as a disruptive player in the field of Technical Education.

MEI has sponsored the setting up of Mahindra University to introduce diverse streams of education in addition to Engineering.

MAHINDRA UNIVERSITY

Mahindra University (MU) was notified by the Government of Telangana vide Telangana Ordinance No. 1 of 2020 dated 20th May 2020 as per the

Telangana State Private Universities (Establishment and Regulation) Act, 2018 for "educating future citizens for and of a better world”.

Mr. Anand Mahindra, Chairman of the Company and the Mahindra Group is the Founding Chancellor of the University and he believes that Professional Courses have the greatest potential to contribute to economic inclusivity and sustainable development.

The University will drive a meaningful shift in the way we deliver higher education, besides focusing on infusing emerging technologies into the education space, it will drive interdisciplinary academic excellence, integrating science technology, humanities, ethics, philosophy and design, with purpose. It will also stress on developing multiskilled leaders, who are ethical and empathetic, and capable of reflection as well as innovation.

The University is India’s first to leverage AI & EI (artificial & emotional intelligence) for both education as well as collaboration, across the board.

Besides the existing programs in Civil Engineering, Computer Science Engineering, Electrical & Electronics Engineering, and Mechanical Engineering, the Ecole Centrale School of Engineering is offering 4-year UG programs of study in Electronics & Computer Engineering, Artificial Intelligence, and Computation and Mathematics from academic session 2020-21.

In the 2020 academic session, 657 students were admitted to the University in UG engineering programs, including 42 students in the PhD program in Engineering. Due to constraints imposed by the pandemic, classes had to be held online for most of the academic session.

The University started its accreditation process with submission of requisite documentation to the National Board of Accreditation for the four UG programs in CSE, EEE, Civil and Mechanical Engineering.

The Annual Report on CSR activities is provided as “Annexure VIII”.

SUSTAINABILITY

The pandemic has reinforced the fact that a focused sustainable strategy is needed for business continuity and profitable growth. All businesses have a critical role to play as a source of finance, driving innovation, and ensuring economic growth and employment.

materials. Spread awareness and initiate campaigns on preventing single-use plastic

• Reduce, Reuse, Recycle, Recover: Implement process of Reduce, Reuse, Recycle and Recover across the value chain to limit waste and enable a circular economy

• Sustainable supply chain: Ensure our suppliers follow the highest standard of sustainable and ethical best practices; optimise logistics and transportation to reduce emissions

• Work-life balance: Provide an assured career development path and a feasible and flexi work-life balance to our associates along with a range of associate-friendly policies and processes

• Innovation: Becoming future ready by proactively encouraging Innovative thinking across the organization, adopting technology disruption to reduce emissions and going digital. Developed sustainable solutions with technologies like loT, Automation, Blockchain and AI in sustainability that will help enable a pathway to reduce emissions and other impacts of climate change.

• Green solutions: Investing in Smart grid, Microgrid-As-A-Services, Community Action Platform for Energy, Integrated Electric Vehicle Charging systems, Smart data hubs and Smart Cities for our Customers to reduce their emissions

• Individual Social Responsibility: encourage associates in making sustainability a part of their daily lives even while working from Home

• Transparency: Showcase our organizational policies, processes, risk management along with financial, environmental and social data in the Integrated Reports available online

The commitment and performances are validated by

the external recognition the Company received:

> The only Indian company to be listed in Carbon Clean 200 by Corporate Knights and As You Sow

> The only Indian IT company to score double ‘A’ in CDP Climate and CDP Water

> Included in the Climate Disclosure Project (CDP) Supplier Engagement Leaderboard 2020

The environment, social and governance (ESG) principles built-in the Tech Mahindra long-term growth strategy have helped to mitigate risks and drive profitable growth even in this crisis situation. Adopting resilient strategies and sustainable transformation with a focus on low carbon future have helped the Company to quickly adapt to disruptions and leverage the processes towards Business continuity. The Company’s commitment to environment sustainability, climate change and water security spans the entire business. As a Company with a purpose, it has delivered on its promise to run better, change faster and grow greater while also creating meaningful human experiences for all. The Cpmpany is pursuing plans that will have long-term impacts on the planet and communities, leading to a balance between sustainability and overall business profitability.

With a structured stakeholder engagement process, Tech Mahindra has been able to design strategies and initiatives, which not only improves our sustainability credentials but also reinforces its overall business philosophy. The Company is breaking through new frontiers, turning to renewable energy to achieve ecological balance while ensuring that when it comes to investments, the Company is pioneering new solutions for sustainable development. Your Company emphasis on green eco-system is seen through its commitment to going carbon neutral, making optimum use of resources and moving towards a low emission technology. The profitability of the Comopany is aligned with its principles, allowing to set sustainability milestones on its journey toward a secure future.

Your Company is aligned to the SDGs (Sustainable Development Goals) and its sustainability focus areas are as below:

• Going Carbon Neutral: Increase use of renewable energy through onsite installation and open access; improve energy efficiency through installation of LEDs, sensors; boost green investments by implementing Carbon Price; optimize business travel by enabling virtual meetings; encourage use of public transport and carpool to reduce commute emissions; plant trees to offset carbon footprints; move towards a low carbon economy ensuring environmental protection

• Saying No to plastic: Maintain plastic-free campuses and encourage associates and stakeholders to use eco-friendly & biodegradable

> One amongst only 3 companies from India to be in DJSI World Index 2020

> One of only 11 Indian Companies in DJSI Emerging Markets 2020

> Only Indian company recognized amongst the ‘2021 Global 100 Most Sustainable Corporations’ by Corporate Knights

> Scored A and included in the top 5 of India’s most Sustainable companies by Business World in collaboration with Sustain Labs Paris

> Awarded Gold rating with 94 percentile in 2020 by ECOVADIS

> Constituent of FTSE4Good Index 2020 by Financial Times Stock Exchange-Russell Group

> Winner of Mahindra Group Sustainability Performance Award 2020

> Leaders with 99 percentiles in SUSTAINALYTICS

The Integrated Annual Report is based on various global standards and frameworks like TCFD (Taskforce on Climate Related Financial Disclosures), CDSB (Climate Disclosure Standards Board), SASB (Sustainability Accounting Standard Board) and GRI standards and assured by third party according to ISAE International Standard on Assurance Engagement) 3000 standard.

Tech Mahindra discloses climate-related risks and opportunities in line with the recommendations of TCFD which focusses on the financial impact of climate-related changes on our operations.

The TechM Board is accountable for all risks and opportunities. The MD and CEO of the Company chairs the CSR Committee of the Board and has the ultimate responsibility for Sustainability. He is ably supported by the Chief Sustainability Officer who directly reports to him and Senior Management members of the Sustainability Council who manage all aspects of climate change including climate-related risks and opportunities.

The pandemic has made it imperative to make this a time of change and a time of learning. Your Company embed sustainability into COVID-19 economic recovery, implement their promises and stretch

its commitments to provide for a better and more sustainable future. Tech Mahindra is committed to the SDGs and is transitioning to a low-carbon economy to achieve the goals of Paris agreement. The strategy includes futureproofing its growth against impending changes in policies and regulations and increasing its compliance readiness. The Company is agile and adaptive to dynamic changes in internal and external environment with strategies in place to manage all business and climate change risks in an effective way. The Company has a robust business continuity management framework and incident response team that ensure it is resilient to any climate change risks.

The targets and the metrics used for managing climate related risks and the progress against these targets are disclosed in the externally assured Integrated reports available here- https://www.techmahindra. com/en-in/sustainability/

AWARDS AND RECOGNITION

Your Company continued its quest for excellence in its chosen area of business to emerge as a true global brand. Several awards and rankings continue to endorse your Company as a thought leader in the industry. Few of the Awards / recognitions received by the Company during the year 2020-21 include:

• Tech Mahindra ranked 10th - winner of ATD Best Award in the ‘Other - IT’ category

• Tech Mahindra won Gold Stevie and Bronze Stevie at "2020 Stevie Awards for Great Employers”

• Tech Mahindra’s Mhealthy won ETHealth Award for Best Technology Solution for COVID-19

• Tech Mahindra amongst 50 best workplaces for women by the Great Place to Work Institute.

• Tech Mahindra recognized amongst ‘India’s Top 20 Companies for Sustainability and CSR 2020’ by The Economic Times and Futurescape 7th Responsible Business Rankings during ETSDG Impact Summit 2020.

• Tech Mahindra recognized as a leader in 2020 Gartner Magic Quadrant for IT Services for communications service providers, worldwide.

• Tech Mahindra has featured amongst the Top 10 "Best Companies for Women in India (BCWI)” by Avtar and Working Mother for the third year in a

row and declared ‘Champions of Inclusion’ in the most inclusive companies of India Index.

• Mr. C. P. Gurnani recognized as ‘The Technology Icon of India’ by VARINDIA Brand book on ICT industry.

• Tech Mahindra featured in Fortune India 500 most valuable firms.

• TMF is a winner for the category ‘Best Corporate Foundation COVID-19 Relief Project [Large Impact]’ at the 9th India CSR Awards 2021.

• Tech Mahindra’s Surveillance Solution for Kanpur Smart City is amongst the winners at FICCI India Smart Urban Innovation Awards 2021.

• Tech Mahindra amongst Forbes Top 50 Organizations in Blockchain for 2021.

• Tech Mahindra recognized as a Leader in Gartner 2021 Magic Quadrant for Customer Service BPO.

ACKNOWLEDGEMENTS

Your Directors place on record their appreciation for the contributions made by employees towards the success of your Company more particularly ensuring business as usual in spite of COVID-19 impact. Your Directors gratefully acknowledge the co-operation and support received from the shareholders, customers, vendors, bankers, regulatory and Governmental authorities in India and abroad.

For and on behalf of the Board

Anand G. Mahindra Place: Mumbai Chairman

Date: April 26, 2021 (DIN: 00004695)


Mar 31, 2021

DIRECTORS’ REPORT

Your Directors present Thirty Fourth Annual Report together with the audited accounts of your Company for the year ended March 31, 2021.

FINANCIAL RESULTS (STANDALONE)

('' in Million)

For the year ended March 31

2021

2020

Income

305,627

315,916

Profit Before Interest, Depreciation and Tax

62,521

60,663

Interest

(632)

(667)

Depreciation

(6,623)

(6,674)

Profit Before Tax

55,266

53,322

Provision for Taxation

(12,875)

(7,977)

Profit After Tax

42,391

45,345

Other Comprehensive Income

2,453

(3,234)

Balance brought forward from previous year

184,021

171,952

Transition impact of Ind AS 116, net of tax

-

(78)

Balance

184,021

171,874

Profit available for appropriation

226,432

217,130

Equity Dividends (Including tax on Dividends)

(19,335) 2

(27,522)1

Transfer to retained earnings on account of options lapsed

96

59

Others

-

26

Transferred to Special Economic Zone re-investment reserve (net of utilisation)

(6,319)

(5,540)

Buyback of equity shares (refer note 18(v))

-

(132)

Balance carried forward

200,874

184,021

1 Interim Dividend for the financial year ended March 31, 2020 and Final Dividend for the financial year ended March 31, 2019

2 Interim Dividend (Special Dividend) for the financial year ended March 31, 2021 and Final Dividend for the financial year ended March 31, 2020

DIVIDEND

The Board of Directors on October 23, 2020 approved a special dividend of '' 15/- per equity share (i.e. 300%) on par value of '' 5/- each which was paid by the Company to the shareholders whose names were appearing in the Register of Members as on November 2, 2020 being the record date for the payment of dividend. Your Directors are pleased to recommend a final dividend of '' 30/- per share (including a special dividend of '' 15/-per share) on par value of '' 5/- (i.e. 600%), payable to those Shareholders whose names appear in the Register of Members as on the Book Closure Date. Thus, the total dividend for the Financial Year 2020-21 will be '' 45/- per share (i.e. 900%) as against '' 15/- per share (i.e. 300%) in the Financial Year 2019-20.

Your Company has formulated a Dividend Policy which is disclosed on the website of the Company at https:// insights.techmahindra.com/investors/tml-dividend-distribution-policy.pdf

SHARE CAPITAL

During the year under review, your Company allotted 2,407,703 equity shares on the exercise of stock options under various Employee Stock Option Schemes. Consequently, the issued, subscribed and paid-up equity share capital has increased from '' 4,829 million divided into 965,852,364 equity shares of '' 5/- each to '' 4,841 million divided into 968,260,067 equity shares of '' 5/- each.

BUSINESS PERFORMANCE / FINANCIAL OVERVIEW

The Company provides connected experiences, offering innovative and customer-centric information technology experiences, enabling Enterprises, Associates and the Society to Rise™. The Company has over 121,000 professionals in over 90 countries, helping 1,007 global customers including many Fortune 500 companies. The Company’s convergent, digital, design experiences, innovation platforms

and reusable assets connect across a number of technologies to deliver tangible business value and experiences to stakeholders. Your Company also focuses on sustainable business strategy, managing social and environmental impacts, while ensuring that corporate decisions lead to an equitable growth. As a result, Tech Mahindra is one of the three companies from India to be included in the DJSI World Index 2020 and one of the eleven Indian companies in the Emerging markets category.

During the Financial Year 2020-21, the Company’s consolidated revenues increased to '' 378,551 million from '' 368,677 million in the previous year, a growth of 2.7%. The geographic split of revenue is 47.5% from the Americas, 26% from Europe and 26.5% from the Rest of the World.

The consolidated Profit (including other income) before Interest, Depreciation and Tax was at '' 75,846 million, against '' 66,955 million in the previous year.

The consolidated Profit after Tax amounted to '' 43,530 million as against '' 38,974 million in the previous year.

In an age of regular technological disruption, Tech Mahindra is delivering value to its customers with its domain expertise and wide range of offerings in blockchain, machine learning, artificial intelligence, cloud, cyber security, quantum computing and IoT combined with an intimate understanding of each customer and their objectives. The Company has collaborated with industry leaders and startups, academia and partners under TechMNxt charter to provide customized yet simplified solutions for customers.

IMPACT OF COVID-19

The COVID - 19 pandemic that began in Q4 of FY 2019-20, continues to impact people globally, causing healthcare crisis, impacting economies and businesses at large. Economic activity took a backseat as most efforts were channelized in strengthening health infrastructure and supporting weaker sections of the economy. The Company did witness impact in several of its clients, as organizations resorted to cash conservation and reduction of discretionary spending. This impacted demand in the first half of Financial Year 2020-21. Your Company undertook several initiatives to ensuring safety of its people, assets and communities at large. The Company deployed business continuity plans ensuring continues service to customers throughout these tough times. Your

Company realigned its strategy, modified the delivery model and crafted solutions focused on enabling the clients to imagine the future of their business, building and running it for them. This led to a robust demand in the second half of the year, as your Company helped adopt massive technological changes and new business models.

ACQUISITIONS

CERIUM

The Company on April 9, 2020 acquired 51% of the share capital of Cerium Systems Private Limited (Cerium). The enterprise value of Cerium is '' 2,450 million. Cerium is an integrated circuit and embedded software design service provider that is expected to help bolster Tech Mahindra’s capabilities in the areas of semiconductor design and testing, embedded software development / testing and product engineering. The remaining 49% to be acquired over the next three years at a valuation linked to the financial performance of Cerium. During the year, the Company acquired a further 6% stake thereby taking the total shareholding to 57%.

ZEN3

The Company on April 9, 2020, acquired 100% of the share capital of Zen3 for a cash consideration of USD 64 million, out of which USD 35 million was paid upfront, USD 4 million will be paid over two years and maximum upto USD 25 million will be paid over three years linked to financial performance. Zen3 is leading software solution group with strong capabilities in AI enablement services, AI speech solutions, cloud engineering, software product engineering and DevOps. Zen3 has more than 1,300 employees across offices in Seattle, Dublin, Bengaluru, Hyderabad and Vishakhapatnam.

TENZING

The Company acquired 100% of the share capital of Tenzing Ltd and Tenzing Australia Ltd (Tenzing Group) through its wholly owned subsidiary Tech Mahindra (Singapore) Pte Ltd at a consideration of USD 29.5 million including earnouts. The Company is headquartered in Auckland, New Zealand and is engaged in the business of Management Consulting, Digital Transformation and Technology services. It has 145 employees and a turnover of USD 27.4 million. The acquisition will bring strong capabilities primarily in the Insurance vertical along with expanding footprint in the Australia and New Zealand (ANZ) market. The acquisition was completed on December 1, 2020.

MOMENTON

Momenton Pty. Ltd. ("Momenton”) was acquired by the Company through its wholly owned subsidiary viz., Tech Mahindra (Singapore) Pte Limited at a consideration upto AUD 14.3 million including earnouts. The company is headquartered in Melbourne, Australia and has approximately 55 employees. Turnover for the financial year ended 30th June 2020, was AUD 10.8 million. Momenton is a cloud and engineering services provider with a Banking and Financial Services (BFS) focus. The acquisition will enhance Tech Mahindra’s digital transformation capabilities and provide Tech Mahindra a scaled-up presence in the Australian BFS market. This acquisition was completed on 12th February 2021.

PERIGORD

The Company acquired 70% of Perigord Asset Holdings Limited ("Perigord”) through its wholly owned subsidiary Mahindra Engineering Services (Europe) Ltd at a consideration of EUR 21 Million and the remaining 30% will be acquired over the next four years at a valuation linked to financial performance of the company. Perigord is headquartered in Dublin, Ireland with a presence in Germany, USA and India with 380 employees. For the financial year ending 31st December 2020, the company had revenue of EUR 19.5 million The Indian subsidiaries of Perigord were acquired by the Company directly.

Perigord specialized in end to end packaging supply chain solutions to the life sciences industry with services such as packaging artwork & labelling services, strategic consultancy, creative and digital, strategic outsourcing, managed services and software solutions. The acquisition was completed on 15th March, 2021.

PAYMENTS TECHNOLOGY SERVICES LIMITED

The Company announced the acquisition of Payments Technology Services Limited, Hongkong on 12th January 2021 at a consideration of USD 9 million. The company is headquartered in Hong Kong and has approximately 109 employees. Turnover of the Company for the financial year ended 31st December 2019 was USD 5.4 million.

The Payments Technology Services entity is a step-down subsidiary of Fidelity Information Services (FIS). The acquired capabilities in the payments space will give us access to IPs and licenses for two products, which is consistent with the strategy of

pivoting the business towards products and platform implementations as well as participating in the banking transformation programs. This acquisition will open up other opportunities for Tech Mahindra across a number of areas in partnership with FIS.

DIGITALONUS

The Company announced the acquisition of DigitalOnUs, Inc. ("DigitalOnUs”) on 19th April 2021 at an enterprise value of USD 120 million through its wholly owned subsidiary, Tech Mahindra (Americas) Inc. The company is headquartered in San Jose, California, USA. DigitalOnUs is focused on Cloud Native Development and Hybrid Cloud Automation services. The acquisition of DigitalOnUs will enhance Tech Mahindra’s capability in cloud native engineering and position it to develop cutting-edge digital solutions for its customers. DigitalOnUs has more than 380 employees. For the financial year ending 31st December 2020, the company had revenue of USD 30.6 million. The Indian subsidiary of DigitalOnUs namely DigitalOps Technology Private Limited has been acquired by the Company.

EVENTUS

The Company announced the acquisition of Eventus Solutions Group, LLC. ("Eventus”) on April 26, 2021 through its wholly owned subsidiary Tech Mahindra (Americas) Inc. at a consideration of USD 44 million. Eventus provides end-to-end customer engagement solutions, such as strategy consulting, cloud based tools and automation services and managed services. The company is headquartered in Denver, Colorado. It has a turnover of USD 33.2 million in CY2020, with an employee base of around 100 spread across various states in the US.

The acquisition of Payment Technology Services Ltd, DigitalOnUs and Eventus are yet to be consummated on the date of this report.

DETAILS OF SUBSIDIARIES / JOINT VENTURES / ASSOCIATE COMPANIES

The performance and financial position of the subsidiaries, associate companies and joint venture companies included in the consolidated financial statement is provided in accordance with the provisions of Section 129 read with Rule 5 of the Companies (Accounts) Rules, 2014 containing the salient features of the financial statement of Company’s subsidiaries/joint ventures or associate companies in Form AOC - 1 in “Annexure I” to this report.

Pursuant to Rule 8(5)(iv) of the Companies (Accounts) Rules, 2014, the names of the companies which have been incorporated or ceased to be the subsidiaries, joint ventures or associate companies during the year are provided in “Annexure II” to this report. The Company is actively pursuing the initiative on consolidation of its subsidiaries/branches to optimise the operational costs. During the year under review, your Company has closed/merged Eight subsidiaries.

In terms of the provisions of Regulation 24 of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, Tech Mahindra (Americas) Inc. is a wholly owned unlisted material subsidiary of the Company.

The policy for determining material subsidiaries formulated by the Board of Directors is disclosed on the Company’s website and is accessible on https:// insights.techmahindra.com/investors/Policy-For-Determining-Material-Subsidiaries.pdf

UPDATE ON MERGER

The Board of Directors at its meeting held on January 31, 2021 approved the Scheme of Merger of Tech Mahindra Business Services Ltd and Born Commerce Private Ltd with the Company. Accordingly, the companies filed the applications before Hon’ble National Company Law Tribunal (NCLT), Mumbai and Chennai Benches respectively. The applications are pending for admission as on the date of this Report.

HUMAN RESOURCES

Your Company has taken several initiatives in the development of human resources, the most important asset of the Company. Some of the initiatives taken in this area are -

Wellness: Putting Well-being at the Forefront

Since 2017, your Company has been leading a unique corporate wellness program called "Wellness Before Business” that has helped prioritize health as the foundation of its associates’ professional, personal, and spiritual well-being. Your Company was able to adapt faster to the challenges of the COVID-19 pandemic, with all actions aligned to this belief. It also gave birth to the mantra of #WellnessFirst and encouraged mental & virtual connect amongst teams while remaining physically apart. Your Company launched the AMIGO Program for holistic emotional and mental wellness for associates and their dependents. Your Company conducted daily health sessions for mental (psychological experts with byte sized videos), emotional (stay connected virtually while

maintaining social distance) and physical (how to stay healthy and fit) wellness. By transitioning to virtual wellness services, daily sessions with experts and incentivizing wellness benefits, your Company has encouraged its associates stay distant, yet connected.

Pandemic: Enabling Work from Home

Your Company was amongst the first to publicly express the need for staying distant and being safe with a logo tweak, the "e” in "Tech Mahindra” being boxed inside a home. Your Company formed Rapid Action Task forces at different locations for business continuity and enabling work from home. These teams helped in collaborating with government authorities, complying with health advisories, implementing best practices like travel restrictions and defining local emergency protocols. Your Company also rolled out several new policies like Remote Workstation set up, Laptop Rental, Special COVID-19 Leave Benefit, Insurance cover for Home Quarantine and Vaccination Cost Reimbursement to support working from home. Associates were also provided with infrastructure support for networking and security requirements. To make associates and managers accustomed to working from home, the WFH101 program was launched within a week of the lockdown. These activities enabled over 90% of associates to work from home productively within 72 hours of the government’s lockdown announcement.

Leadership: Peacetime Leaders to Wartime Generals

The COVID-19 pandemic changed the leadership paradigm and style of functioning. Your Peacetime Leaders became Wartime Generals. Like in war, one does not have the luxury of time to mull over decision making, the pandemic called for leaders to become agile, think fast and act faster. It meant being focused and yet open to revisiting strategies, taking bold risks, judiciously deploying resources and above all, working tirelessly till the war was won! This new model of ‘Wartime Generals’ is what your Company sought to create. These new leaders helped rally their teams, kept the team engaged and communicated clear, crisp messages frequently while challenging conventional thinking. Your Company has launched a real-time Performance Management System for its top 300 leaders to drive a high-performance culture which ensures that key business initiatives and leaders’ goals are in-sync and tracked regularly. Your Company has also setup five transformation offices and identified 36 strategic initiatives along with output metrics, targets and RACI.

Communication: Frequent, Transparent and Empathetic

With associates working from home, your Company faced natural challenges in ensuring that a distributed workforce stayed connected. Your Company communicated with urgency, transparency and empathy to help associates adjust to the constantly changing conditions crises bring and to maintain a single source of truth. Your Company created a live microsite to prioritize consistent and continuous communication. Your Company launched a daily newsletter called TechM Coronicles that included a video message from a leader, inspirational stories, clarification of rumours, training calendars, associate engagements and customer kudos. Additionally, a new connect series called PrimeTime was introduced to keep associates updated and inspired by external speakers. This was a daily one-hour virtual connect and it featured global leaders from a cross section of industries including Sports, Cinema and Politics. There were close to 150 episodes of Primetime over the course of the year.

Engagement: lovetobeTechM has no boundaries

Your Company used connected technologies to create meaningful experiences for associates working remotely and organized several collaborative activities that included their families. Through the "Each One House One” initiative associates welcomed their colleagues from their neighborhood into their homes. Your Company also facilitated the return of approximately 2000 associates and their families who were stranded abroad through repatriation flights.

Rewards: Nurturing A Culture of Giving

Your Company and its associates believe in driving positive change especially the vulnerable communities impacted during pandemic through individual and Company social responsibility. Last year associates donated ''1.5 million towards social causes - a 105% increase over the previous year. Associates also helped vulnerable communities through voluntary services like grocery/grain distribution, tree plantation and community drives, taking care of migrant workers, donating PPE kits / medical supplies etc. Your Company also facilitated the screening of around 10,000 third-party vendors, associates and members of the partner ecosystem including those working in pantry, sanitation and security departments through the Mhealthy platform. Mhealthy was launched in July 2020 with 32 screening tests, risk profile, access to medical care, antibody test for COVID-19 to secure the workplace. Through these numerous measures,

your Company has continued to recognise the extra ordinary resilience shown by associates through its digital platform that nurtures appreciation and social sharing.

Hiring: Reversing the pyramid

Your Company has taken proactive steps to introduce young talent that will thrive in the ‘new normal.’ With the launch of new programs like LEAP and ELEVATE, your Company gives fresh graduates the flexibility of remote work from home. These programs in addition to the existing ELITE Engineering graduate hiring, Management Trainee program (for hiring fresh talent from B-schools) and Global Leadership Cadre program (for fast-tracking the growth of young leaders) help your Company reverse the pyramid. Your Company has also expanded the use of the #NewAgeDelivery platform in the hiring process by checking for internal talent that are to be released from projects or those already on the bench so as to reduce external hiring costs.

Learning: Becoming Fit4Future

During the year virtual learning picked up momentum as your Company prioritized re-skilling and upskilling through the NAD Learn (formerly Upskilling as a Service) platform. This self-learning ecosystem has offered more than 55,000 associates the opportunity to become full-stack/ full cycle professionals. 20,000 associates are engaged in the RIDE Future Skilling program that is helping your Company transition to new age technologies. Your Company launched EMBARK to train 500 Program Managers on ten special competencies. The top 300 Leaders who completed the Chrysalis program last year had a special 3-month development journey to help them lead during this unprecedented time. Your Company has also helped 400 customers across 31 countries prepare for a post COVID-19 world by sharing best practices and learning content.

Diversity: Creating a sense of Belonging

Your Company reinforced its commitment to being intentionally diverse by becoming a signatory of UN Women and a part of the WEP (Women’s Empowerment Principles) Community. The Women Leaders Program has helped your Company identify more than 50 trailblazers who can drive future business in the ‘new normal.’ Focussed efforts were made towards generational diversity as young leaders were developed through programs like AIM, Ascend and Transcend.

QUALITY

The Company continues its focus on quality and strives to exceed customer expectations at all times. During the year, it continued to strengthen the implementation of CMMI Dev v1.3 (Capability Maturity Model Integration) Dev v1.3 (Capability Maturity Model Integration) (Development) for which the organization is assessed at L5. Similarly it underwent various upgrade and continuous evaluation audits for multiple standards during the year in order to meet client demands and enhance value delivery - Successfully assessed for, CMMI Dev v 1.3, Level 5, ISO 9001:2015 (Quality Management System), ISO 20000-1:2018 (Information Technology Service Management System), ISO 27001:2013 (Information Security Management System), TL9000 R 6.2/ R5.6 (Quality Management Systems for Tele Communications industry), ISO 13485:2016 (Quality Management Systems for medical devices - scope of certification limited to medical devices business within Tech Mahindra), AS9100 Rev D (Standard for Aerospace domain - scope of certification limited to the aerospace business within Tech Mahindra).

In addition to these, your Company also maintains its commitment to health, safety and environment by continually improving its processes in accordance with ISO 14001:2015 (Environmental Management System) and ISO 45001: 2018 (Occupational Health and Safety Assessment Series) standards. Your Company is also certified on ISO 22301:2012 (Societal Security and Business Continuity Management System) and has a comprehensive Business Continuity and Disaster Recovery framework, to prevent potential business disruptions in the event of any disaster. It has processes that helped resume services to customer’s acceptable service levels. Automated Service Desk with SLAs for enabling business and Vulnerability Assessment and Penetration Testing Lab for secured corporate network operations are highlights that showcase the information security posture of the Organization.

During the pandemic year, the entire quality management system was put to test, associates were working from home while complying with all security requirements and able to deliver the services to the desired quality as per customer contractual commitments.

Tech Mahindra (IT Division) has been assessed for the implementation of high maturity business excellence practices at Mahindra Group (Services Sector). It has

been assessed at TMW Maturity Stage 6 (on scale of 1-10 stages) of Mahindra Business Excellence Framework - The Mahindra Way. These certifications are testimony of the robustness of business processes and at large the quality culture imbibed in the organization.

Your Company has continued to strengthen the process for transforming Quality Assurance processes & delivery methods to New Age Delivery processes through the #NewAgeDelivery Engine. This engine focuses on asset creation and re-usability, enabling associates to be rightly skilled through Upskilling as a service, enabling projects and programs to deploy smart planning and crowd sourcing through Capability as a service, providing an automated workflow environment for the associates to execute the project seamlessly through Digital inside and Continuous Delivery. All of this has lead to better customer experience and faster quality delivery. This engine is further strengthened with command center view for the programs and units to access their realtime performance against the targets. Moreover the system is enabled with automated signals and alerts when the performance breaches the threshold for the owner to take corrective actions. The Company is putting all these initiatives in place to ensure that it deliver as stated in its Quality Policy.

DIRECTORS

During the year under review, all Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Independent Directors have also given declaration of compliance with Rules 6(1) and 6(2) of the Companies (Appointment and Qualification of Directors) Rules, 2014, with respect to their name appearing in the data bank of Independent Directors maintained by the Indian Institute of Corporate Affairs.

Pursuant to the provisions of Section 152(6)(c) of the Companies Act, 2013, Dr. Anish Shah is liable to retire by rotation and offers himself for reappointment.

Dr. Anish Shah (DIN: 02719429) who was appointed as an Additional Director with effect from September 10, 2019 has been appointed as Director of the Company at the Annual General Meeting held on July 28, 2020.

Your Directors co-opted Mr. Manoj Bhat (DIN: 05205447) as an Additional Director with effect from 2nd April 2021 whose term will end at the ensuing Annual General Meeting and being eligible offers himself for appointment.

Mr. V.S. Parthasarathy, (DIN: 00125299) resigned as director of the Company with effect from 31st January 2021. Your board places on record its sincere appreciation for the valuable services rendered by Mr. Parthasarathy to the Company during his tenure.

In terms of Regulation 24(1) of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, Mr. T. N. Manoharan, Independent Director of the Company has been appointed as Director in Tech Mahindra (Americas) Inc., a Wholly owned unlisted material subsidiary of the Company with effect from May 21, 2019.

Mr. T. N. Manoharan was also appointed as Lead Independent Director by the Board of Directors at its Meeting held on April 26, 2021.

In the opinion of the Board of Directors the Independent Directors have relevant proficiency, expertise and experience.

FAMILIARISATION PROGRAMME

These programmes aim to provide insights into the Company to enable the Independent Directors to understand its business in depth and contribute significantly to the Company. The details of program for familiarisation of the Independent Directors with the Company are available on the Company’s website and can be accessed at; https://insights. techmahindra.com/investors/tml-familarisation-progarmmes-for-IDs.pdf

The Board members are also regularly updated on changes in the statutory provisions like changes in Corporate Laws, SEBI Regulations, Taxation Laws and People related laws as applicable at the quarterly Board meetings. The Board members are also updated on the Risk universe applicable to the Company’s business. The MD & CEO of the Company had a quarterly session with Board members sharing updates about the Company’s business strategy, operations and the key trends in the IT industry that are relevant for the Company. These updates help the board members in keeping abreast of the key changes and their impact on the Company.

BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and Regulation 19 read with Schedule II, Part D of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has devised a policy on evaluating the performance of the Board of Directors, the Chairman, Committees, and Individual Directors. The evaluation process was carried out through a web-based portal. The summary of the evaluation reports was presented to the respective Committees and the Board. The Directors had a positive feedback on the overall functioning of the Committees and the Board. The suggestions made by the Directors in the evaluation process have been suitably incorporated in the processes.

NUMBER OF MEETINGS OF THE BOARD

The Board met seven times during the financial year 2020-21. The meeting details are provided in Corporate Governance report that forms part of this Annual Report. The maximum interval between any two meetings did not exceed 120 days as prescribed in the Companies Act, 2013 and SEBI Listing Regulations.

POLICY ON DIRECTORS’ APPOINTMENT AND REMUNERATION

The Governance policies laid down by the Board of Directors of your Company include:

i. Policy on appointment and removal of Directors, Key Managerial Personnel and Senior Management.

ii. Policy on remuneration to the Directors, Key Managerial Personnel and Senior Management and other Employees.

The extract of these two policies are provided in “Annexure III”.

The policies are available on the Company’s website on https://insights.techmahindra.com/investors/ Governance-Policies-including-remuneration-to-Directors-KMPS.pdf

SUCCESSION PLAN

In accordance with the principles of transparency and consistency, your Company has adopted governance policies for its Board of Directors, Key Managerial Personnel & senior management appointments, remuneration and evaluation. In line with these Governance policies, the Company has

established a formal Succession Planning Program for key managerial persons across the organization. The Board evaluates all such plans at a regular intervals and institutes a formal program for filling any such critical position. The Board evaluates both internal and external candidates for such positions alongwith the recommendations of the Company. The Company also has a leadership development program where it identifies high potential managers, and trains them to take up the positions of higher responsibilities. The Company has identified the second line of leadership, which provides stability to the business in any contingencies.

TRAINING

The Company has laid down a policy on training for Independent Directors, as part of the governance policies. The Senior Leadership of the Company update the Directors on the regulatory changes, Business strategy and operations periodically.

KEY MANAGERIAL PERSONNEL (KMP)

Pursuant to provisions of Section 203 of the Companies Act, 2013, Mr. C. P Gurnani, Managing Director & Chief Executive Officer, Mr. Manoj Bhat, Chief Financial Officer and Mr. Anil Khatri, Company Secretary & Compliance Officer were the Key Managerial Personnel of the Company during the year under review. Mr. Milind Kulkarni was appointed as Chief Financial Officer of the Company w.e.f. 2nd April 2021.

DIRECTORS’ RESPONSIBILITY STATEMENT

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

i. in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

ii. they have, in the selection of the accounting policies, consulted the Statutory Auditors and these have been applied consistently and, reasonable and prudent judgments and estimates have been made so as to give a true and fair view of the state of affairs of the Company as at March 31, 2021 and of the profit of the Company for the year ended on that date;

iii. proper and sufficient care had been taken 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 other irregularities;

iv. the annual accounts have been prepared on a going concern basis;

v. they had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively;

vi. the proper systems to ensure compliance with the provisions of all applicable laws are in place and are adequate and operating effectively.

DETAILS WITH RESPECT TO ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS

The Company has internal financial controls which are adequate and were operating effectively. The controls are adequate for ensuring the orderly and efficient conduct of the business, including adherence to the Company’s policies, the safe guarding of assets, the prevention & detection of frauds & errors, the accuracy and completeness of accounting records and timely preparation of reliable financial information.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS / PROCEEDINGS

There are no significant and material orders passed by the regulators or courts or tribunal impacting the going concern status and the Company’s operations in the future.

Further no application against the Company has been filed or is pending under the Insolvency and Bankruptcy Code, 2016, nor the Company has done any one time settlement with any Bank or Financial institutions.

STATUTORY AUDITORS

The members, in the 30th Annual General Meeting held on August 1, 2017, appointed B S R & Co. LLP, Chartered Accountants, [Firm’s Registration No. 101248W/W- 100022] as the Statutory Auditors of the Company, to hold office for a term of five years from the conclusion of the 30th Annual General Meeting (AGM) of the Company held in the financial year 201718 until the conclusion of the AGM of the Company for the financial year 2021- 22 on such remuneration as may be determined by the Board of Directors.

The members may note that the Ministry of Corporate Affairs vide notification dated May 07, 2018, has done away with the requirement of yearly ratification of appointment of Statutory Auditors, at the AGM.

Pursuant to Section 139 of the Companies Act, 2013 the statutory auditors B S R & Co. LLP, Chartered Accountants have confirmed that they are eligible to continue as auditors.

There are no qualifications, reservations, adverse remark or disclaimer made in the audit report for the Financial Year 2020-21.

SECRETARIAL AUDIT REPORT

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 had appointed Dr. K. R. Chandratre, Practicing Company Secretary, Pune to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is available at “Annexure IV” to this report. There are no qualifications, reservations, adverse remark or disclaimer made in the Secretarial Audit Report.

COMPLIANCE WITH SECRETARIAL STANDARDS

The Company has complied with the applicable Secretarial Standards.

ANNUAL RETURN

Pursuant to the provisions of Section 92(3) read with Section 134(3) (a) of the Companies Act, 2013, the Annual Return in Form MGT-7 is available at the web link: https://insights.techmahindra.com/investors/mgt7-annual-return-202021.pdf

MANAGERIAL REMUNERATION

Disclosures of the ratio of the remuneration of each director to the median employee’s remuneration and other details as required pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended from time to time, are provided as “Annexure V”.

None of the directors or Managing Director & CEO of the Company, received any remuneration or commission from Subsidiary Companies of your Company.

The details of remuneration paid to the Directors including the Managing Director & CEO of the Company are given in Corporate Governance Report.

PARTICULARS OF EMPLOYEES

The information required under Section 197(12) of the Companies Act, 2013 ("the Act”) read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms part of this Report. However, pursuant to first proviso to Section 136(1) of the Act, this Report is being sent to the Shareholders excluding the aforesaid information. Any shareholder interested in obtaining said information, may write to the Company Secretary at the Registered Office / Corporate Office of the Company and the said information is open for inspection at the Registered Office of the Company.

POLICY ON PREVENTION OF SEXUAL HARASSMENT

Your Company laid down Prevention of Sexual Harassment (POSH) policy which is available on its website. The Company has zero tolerance on Sexual Harassment at workplace. During the year under review there were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

The status of complaints received under POSH and redressed by the POSH Committee of the Company, during the financial year under review, are given below:

a) Number of complaints received - 30

b) Number of complaints redressed - 28

c) Number of complaints pending - 2

The Company carried out focused campaign on POSH and Awareness drives with the help of its BPS teams. Further the employees are required to undertake mandatory certification on POSH to strengthen the POSH awareness and sensitivity.

EMPLOYEE STOCK OPTION SCHEMES

During the year under review, there were no material changes in the Employee Stock Option Schemes (ESOPs) of the Company and the Schemes are in compliance with the SEBI Regulations on ESOPs. As per Regulation 14 of SEBI (Share Based Employee Benefits) Regulations, 2014 read with SEBI circular dated June 16, 2015 the details of the ESOPs are uploaded on the Company’s website; https:// insights.techmahindra.com/investors/Details-of-ESOPs-FY-2020-21.pdf

CORPORATE GOVERNANCE

A report on Corporate Governance covering among others composition, details of meetings of the Board and Committees along with a certificate for compliance with the conditions of Corporate Governance in accordance with the Securities and Exchange Board of India (Listing Obligations And Disclosure Requirements) Regulations, 2015, issued by the Statutory Auditors of the Company, forms part of this Annual Report.

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.

COST RECORDS

Maintenance of cost records and requirement of cost audit as prescribed under the provisions of Section 148 (1) of the Companies Act, 2013 are not applicable for the business activities of the Company.

RISK MANAGEMENT

The Risk Management Committee of the Board of Directors guides the operating management to identify risks, analyze their probability and impact and prepare mitigation plans. It periodically reviews the Risk Management Framework & Enterprise Risk Register which is presented by the Chief Risk Officer. The Company identifies all potential risks, economical, business, currency, operational, climate, governance, financial etc and prepares a mitigation plan for each of the risks. The elements of risk as identified by the Company with the impact and mitigation strategy are set out in the Management Discussion and Analysis Report (MDA).

ESTABLISHMENT OF VIGIL MECHANISM

The Company has laid down Whistle Blower Policy covering Vigil Mechanism with protective Clauses for the Whistle Blowers. The Whistle Blower Policy is made available on the website of the Company.

DEPOSITS / LOANS & ADVANCES, GUARANTEES OR INVESTMENTS

The Company has not accepted any deposits from the public during the year under review. The particulars of loans/advances, guarantees and investments under Section 186 of the Companies Act, 2013 are given in the notes forming part of the Financial Statements.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All transactions entered into with Related Parties as defined under Section 2(76) of the Companies Act, 2013 and Regulation 23 of the Securities and Exchange Board of India (Listing Obligations And Disclosure Requirements) Regulations, 2015, ("The Listing Regulations”), during the financial year under review were in the ordinary course of business and at an arm’s length pricing basis and do not attract the provisions of Section 188 of the Companies Act, 2013. There were no transactions with related parties in the financial year which were in conflict with the interest of the Company and requiring compliance of the provisions of Regulation 23 of the Listing Regulations. Suitable disclosure as required by the Indian Accounting Standards (Ind AS 24) has been made in the notes forming part of the Financial Statements.

The Company has formulated a policy on the materiality of Related Party Transactions and dealing with Related Party Transactions which has been uploaded on the Company’s website and can be accessed at following link https://insights.techmahindra.com/investors/Related-Party-Transactions-Policy.pdf

The particulars of related party transactions in prescribed Form AOC - 2 are attached as “Annexure VI”.

Pursuant to Regulation 23(9) of the Listing Regulations your Company has filed half yearly report on Related Party Transactions with the stock exchanges.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars as prescribed under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 are provided in “Annexure VII” which forms part of this report.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

The CSR vision of the Company is "Empowerment through Education.”

In compliance with the guidelines prescribed under Section 135 of the Companies Act, 2013, your Company has constituted a Corporate Social Responsibility (CSR) Committee of the Board. The CSR policy, covering the Objectives, Focus Areas, Governance Structure Monitoring and Reporting

Framework among others is approved by the Board of Directors. In accordance with the amendments made in Section 135 in January 2021, the CSR Policy has been duly revised and is available at https://files. techmahindra.com/static/img/pdf/csr-policy-techm-v3-march2021.pdf

The Company has spent more than 2% of the average net profits of the Company during the three immediately preceding financial years on CSR. During the year under review, the Company contributed a significant amount towards COVID-19 relief efforts.

The Company’s social initiatives are mainly carried out by Tech Mahindra Foundation and Mahindra Educational Institutions, Section 8 (erstwhile Section 25) Companies promoted by the Company.

TECH MAHINDRA FOUNDATION (TMF)

The Foundation was set up in 2006, as a Section 25 Company (referred to as a Section 8 Company in the Companies Act, 2013). Since then, it has worked tirelessly towards the overarching vision of "Empowerment through Education”, establishing itself as a prominent CSR player within the Mahindra Group as well as a leading social organization at the national level. The Foundation essentially works with children, youth and teachers from disadvantaged urban communities in India, with a special focus on women and persons with disabilities. During the year under review, Tech Mahindra Foundation has successfully implemented 150 high-impact projects with more than 90 partners, directly benefitting 31,767 individuals. In addition, the Foundation reached out to over 1.5 Million people across the country through its COVID Relief efforts.

EDUCATION

The key initiatives in the area of School Education include:

ALL ROUND IMPROVEMENT IN SCHOOL EDUCATION (ARISE)

Tech Mahindra Foundation’s educational initiatives under ARISE are long-term school improvement programmes, in partnership with local governments and partner organisations. The Foundation in 202021 worked with 30 government schools to turn them around into model schools of excellence. Around 6,400 students were covered under this programme.

During the year, the Foundation expanded its work for children with disabilities through its ARISE

programme. This programme is a variant of ARISE in which children with disabilities are provided chronic therapy as well as special education to help them lead more fulfilling lives. Through 25 projects, the programme enabled 2,776 differently-abled students to become better learners and more independent in managing themselves. As the interventions shifted to online mode, 430 students were provided digital tablets to ensure continuity of learning.

SHIKSHAANTAR

Shikshaantar, envisioned as a programme for enhancing capacity of government school teachers, has emerged as an important programme in the education portfolio of the Foundation. TMF works with the Municipal Corporations in East Delhi and North Delhi by running their In-Service Teacher Education Institutes, and during the year under review, as many as 6,378 teachers were trained as part of this initiative. This included specially designed modules for Digital Literacy, Cyber Security and Mental Health that were delivered to the teachers through online sessions.

MOBILE SCIENCE LAB

In order to increase the footprint of its work in education and reach the unreached, TMF launched a unique initiative in 2019-20 - the Mobile Science Lab. For this, a Mahindra bus was remodeled into a science lab on wheels that travelled across schools in East Delhi to provide STEM learning for children in grades 3 and 4. Though the program could not be implemented because of COVID, a second Mobile Science Lab was commissioned through funding received from the National Scheduled Caste Finance & Development Corporation.

EMPLOYABILITY

Skills-for-Market Training (SMART) is the Foundation’s flagship programme in employability. It is built on the vision of an educated, enabled and empowered India, and the belief that educated and skilled youth are the country’s true strength. The programme started with three Centres in 2012 and is currently running over 100 Centres at 11 locations across India. These include SMART Centres, SMART Centres (training for people with disabilities), and SMART-T Centres (training in technical trades).

I n financial year 2020-21, your Company trained 14,394 young women and men under its SMART program, of which, 1,687 were persons with disabilities. Upon successful completion of the course, more than 70% of the graduates are placed in jobs across multiple

industries. A significant achievement for the year was that the average salaries earned by the students increased by over '' 500 per month, despite the severe impact of the pandemic.

The Foundation’s commitment to setting new benchmarks in skill development in India has been underscored by the setting up of Tech Mahindra SMART Academies, which provide the highest quality of skill training to youngsters in Healthcare and Digital Technologies. During FY 2020-21, 1,317 students were enrolled to the four Healthcare Academies in Delhi, Mohali, Mumbai, and Pune, the last of which started functioning in March 2021. In addition, another 710 students were enrolled at the SMART Academies for Digital Technologies in Vizag, Hyderabad and Mohali.

TMF’s work in COVID Relief

As soon as the pandemic broke out in the beginning of the Financial Year, the TMF team shifted its emphasis towards carrying out relief activities for those who were the hardest hit - daily wagers, migrant workers, farmers, persons with disabilities and the transgender community. Through a structured and efficient intervention, the Foundation distributed nearly 6 lakhs ration kits, 3.20 lakhs cooked meals, PPE kits, masks, and medical equipment to hospitals. In all, relief efforts worth '' 14.82 crores were carried out over the year that continued into the current financial year as well. Till date, over 20 lakhs people have benefitted through these efforts.

MAHINDRA EDUCATIONAL INSTITUTIONS (MEI)

MEI - a not-for-profit, 100% subsidiary of the Company has set up Mahindra Ecole Centrale in August 2014 - through a collaborative venture between Mahindra Educational Institutions and Ecole Centrale of Paris, France (now known as Centrale Supelec) and the JNTU Hyderabad - to offer undergraduate engineering programs. Through this strong Indo-French Collaboration with Centrale Supelec and Industry connect with Tech Mahindra, MEC has emerged as a disruptive player in the field of Technical Education.

MEI has sponsored the setting up of Mahindra University to introduce diverse streams of education in addition to Engineering.

MAHINDRA UNIVERSITY

Mahindra University (MU) was notified by the Government of Telangana vide Telangana Ordinance No. 1 of 2020 dated 20th May 2020 as per the

Telangana State Private Universities (Establishment and Regulation) Act, 2018 for "educating future citizens for and of a better world”.

Mr. Anand Mahindra, Chairman of the Company and the Mahindra Group is the Founding Chancellor of the University and he believes that Professional Courses have the greatest potential to contribute to economic inclusivity and sustainable development.

The University will drive a meaningful shift in the way we deliver higher education, besides focusing on infusing emerging technologies into the education space, it will drive interdisciplinary academic excellence, integrating science technology, humanities, ethics, philosophy and design, with purpose. It will also stress on developing multiskilled leaders, who are ethical and empathetic, and capable of reflection as well as innovation.

The University is India’s first to leverage AI & EI (artificial & emotional intelligence) for both education as well as collaboration, across the board.

Besides the existing programs in Civil Engineering, Computer Science Engineering, Electrical & Electronics Engineering, and Mechanical Engineering, the Ecole Centrale School of Engineering is offering 4-year UG programs of study in Electronics & Computer Engineering, Artificial Intelligence, and Computation and Mathematics from academic session 2020-21.

In the 2020 academic session, 657 students were admitted to the University in UG engineering programs, including 42 students in the PhD program in Engineering. Due to constraints imposed by the pandemic, classes had to be held online for most of the academic session.

The University started its accreditation process with submission of requisite documentation to the National Board of Accreditation for the four UG programs in CSE, EEE, Civil and Mechanical Engineering.

The Annual Report on CSR activities is provided as “Annexure VIII”.

SUSTAINABILITY

The pandemic has reinforced the fact that a focused sustainable strategy is needed for business continuity and profitable growth. All businesses have a critical role to play as a source of finance, driving innovation, and ensuring economic growth and employment.

materials. Spread awareness and initiate campaigns on preventing single-use plastic

• Reduce, Reuse, Recycle, Recover: Implement process of Reduce, Reuse, Recycle and Recover across the value chain to limit waste and enable a circular economy

• Sustainable supply chain: Ensure our suppliers follow the highest standard of sustainable and ethical best practices; optimise logistics and transportation to reduce emissions

• Work-life balance: Provide an assured career development path and a feasible and flexi work-life balance to our associates along with a range of associate-friendly policies and processes

• Innovation: Becoming future ready by proactively encouraging Innovative thinking across the organization, adopting technology disruption to reduce emissions and going digital. Developed sustainable solutions with technologies like loT, Automation, Blockchain and AI in sustainability that will help enable a pathway to reduce emissions and other impacts of climate change.

• Green solutions: Investing in Smart grid, Microgrid-As-A-Services, Community Action Platform for Energy, Integrated Electric Vehicle Charging systems, Smart data hubs and Smart Cities for our Customers to reduce their emissions

• Individual Social Responsibility: encourage associates in making sustainability a part of their daily lives even while working from Home

• Transparency: Showcase our organizational policies, processes, risk management along with financial, environmental and social data in the Integrated Reports available online

The commitment and performances are validated by

the external recognition the Company received:

> The only Indian company to be listed in Carbon Clean 200 by Corporate Knights and As You Sow

> The only Indian IT company to score double ‘A’ in CDP Climate and CDP Water

> Included in the Climate Disclosure Project (CDP) Supplier Engagement Leaderboard 2020

The environment, social and governance (ESG) principles built-in the Tech Mahindra long-term growth strategy have helped to mitigate risks and drive profitable growth even in this crisis situation. Adopting resilient strategies and sustainable transformation with a focus on low carbon future have helped the Company to quickly adapt to disruptions and leverage the processes towards Business continuity. The Company’s commitment to environment sustainability, climate change and water security spans the entire business. As a Company with a purpose, it has delivered on its promise to run better, change faster and grow greater while also creating meaningful human experiences for all. The Cpmpany is pursuing plans that will have long-term impacts on the planet and communities, leading to a balance between sustainability and overall business profitability.

With a structured stakeholder engagement process, Tech Mahindra has been able to design strategies and initiatives, which not only improves our sustainability credentials but also reinforces its overall business philosophy. The Company is breaking through new frontiers, turning to renewable energy to achieve ecological balance while ensuring that when it comes to investments, the Company is pioneering new solutions for sustainable development. Your Company emphasis on green eco-system is seen through its commitment to going carbon neutral, making optimum use of resources and moving towards a low emission technology. The profitability of the Comopany is aligned with its principles, allowing to set sustainability milestones on its journey toward a secure future.

Your Company is aligned to the SDGs (Sustainable Development Goals) and its sustainability focus areas are as below:

• Going Carbon Neutral: Increase use of renewable energy through onsite installation and open access; improve energy efficiency through installation of LEDs, sensors; boost green investments by implementing Carbon Price; optimize business travel by enabling virtual meetings; encourage use of public transport and carpool to reduce commute emissions; plant trees to offset carbon footprints; move towards a low carbon economy ensuring environmental protection

• Saying No to plastic: Maintain plastic-free campuses and encourage associates and stakeholders to use eco-friendly & biodegradable

> One amongst only 3 companies from India to be in DJSI World Index 2020

> One of only 11 Indian Companies in DJSI Emerging Markets 2020

> Only Indian company recognized amongst the ‘2021 Global 100 Most Sustainable Corporations’ by Corporate Knights

> Scored A and included in the top 5 of India’s most Sustainable companies by Business World in collaboration with Sustain Labs Paris

> Awarded Gold rating with 94 percentile in 2020 by ECOVADIS

> Constituent of FTSE4Good Index 2020 by Financial Times Stock Exchange-Russell Group

> Winner of Mahindra Group Sustainability Performance Award 2020

> Leaders with 99 percentiles in SUSTAINALYTICS

The Integrated Annual Report is based on various global standards and frameworks like TCFD (Taskforce on Climate Related Financial Disclosures), CDSB (Climate Disclosure Standards Board), SASB (Sustainability Accounting Standard Board) and GRI standards and assured by third party according to ISAE International Standard on Assurance Engagement) 3000 standard.

Tech Mahindra discloses climate-related risks and opportunities in line with the recommendations of TCFD which focusses on the financial impact of climate-related changes on our operations.

The TechM Board is accountable for all risks and opportunities. The MD and CEO of the Company chairs the CSR Committee of the Board and has the ultimate responsibility for Sustainability. He is ably supported by the Chief Sustainability Officer who directly reports to him and Senior Management members of the Sustainability Council who manage all aspects of climate change including climate-related risks and opportunities.

The pandemic has made it imperative to make this a time of change and a time of learning. Your Company embed sustainability into COVID-19 economic recovery, implement their promises and stretch

its commitments to provide for a better and more sustainable future. Tech Mahindra is committed to the SDGs and is transitioning to a low-carbon economy to achieve the goals of Paris agreement. The strategy includes futureproofing its growth against impending changes in policies and regulations and increasing its compliance readiness. The Company is agile and adaptive to dynamic changes in internal and external environment with strategies in place to manage all business and climate change risks in an effective way. The Company has a robust business continuity management framework and incident response team that ensure it is resilient to any climate change risks.

The targets and the metrics used for managing climate related risks and the progress against these targets are disclosed in the externally assured Integrated reports available here- https://www.techmahindra. com/en-in/sustainability/

AWARDS AND RECOGNITION

Your Company continued its quest for excellence in its chosen area of business to emerge as a true global brand. Several awards and rankings continue to endorse your Company as a thought leader in the industry. Few of the Awards / recognitions received by the Company during the year 2020-21 include:

• Tech Mahindra ranked 10th - winner of ATD Best Award in the ‘Other - IT’ category

• Tech Mahindra won Gold Stevie and Bronze Stevie at "2020 Stevie Awards for Great Employers”

• Tech Mahindra’s Mhealthy won ETHealth Award for Best Technology Solution for COVID-19

• Tech Mahindra amongst 50 best workplaces for women by the Great Place to Work Institute.

• Tech Mahindra recognized amongst ‘India’s Top 20 Companies for Sustainability and CSR 2020’ by The Economic Times and Futurescape 7th Responsible Business Rankings during ETSDG Impact Summit 2020.

• Tech Mahindra recognized as a leader in 2020 Gartner Magic Quadrant for IT Services for communications service providers, worldwide.

• Tech Mahindra has featured amongst the Top 10 "Best Companies for Women in India (BCWI)” by Avtar and Working Mother for the third year in a

row and declared ‘Champions of Inclusion’ in the most inclusive companies of India Index.

• Mr. C. P. Gurnani recognized as ‘The Technology Icon of India’ by VARINDIA Brand book on ICT industry.

• Tech Mahindra featured in Fortune India 500 most valuable firms.

• TMF is a winner for the category ‘Best Corporate Foundation COVID-19 Relief Project [Large Impact]’ at the 9th India CSR Awards 2021.

• Tech Mahindra’s Surveillance Solution for Kanpur Smart City is amongst the winners at FICCI India Smart Urban Innovation Awards 2021.

• Tech Mahindra amongst Forbes Top 50 Organizations in Blockchain for 2021.

• Tech Mahindra recognized as a Leader in Gartner 2021 Magic Quadrant for Customer Service BPO.

ACKNOWLEDGEMENTS

Your Directors place on record their appreciation for the contributions made by employees towards the success of your Company more particularly ensuring business as usual in spite of COVID-19 impact. Your Directors gratefully acknowledge the co-operation and support received from the shareholders, customers, vendors, bankers, regulatory and Governmental authorities in India and abroad.

For and on behalf of the Board

Anand G. Mahindra Place: Mumbai Chairman

Date: April 26, 2021 (DIN: 00004695)


Mar 31, 2021

DIRECTORS’ REPORT

Your Directors present Thirty Fourth Annual Report together with the audited accounts of your Company for the year ended March 31, 2021.

FINANCIAL RESULTS (STANDALONE)

('' in Million)

For the year ended March 31

2021

2020

Income

305,627

315,916

Profit Before Interest, Depreciation and Tax

62,521

60,663

Interest

(632)

(667)

Depreciation

(6,623)

(6,674)

Profit Before Tax

55,266

53,322

Provision for Taxation

(12,875)

(7,977)

Profit After Tax

42,391

45,345

Other Comprehensive Income

2,453

(3,234)

Balance brought forward from previous year

184,021

171,952

Transition impact of Ind AS 116, net of tax

-

(78)

Balance

184,021

171,874

Profit available for appropriation

226,432

217,130

Equity Dividends (Including tax on Dividends)

(19,335) 2

(27,522)1

Transfer to retained earnings on account of options lapsed

96

59

Others

-

26

Transferred to Special Economic Zone re-investment reserve (net of utilisation)

(6,319)

(5,540)

Buyback of equity shares (refer note 18(v))

-

(132)

Balance carried forward

200,874

184,021

1 Interim Dividend for the financial year ended March 31, 2020 and Final Dividend for the financial year ended March 31, 2019

2 Interim Dividend (Special Dividend) for the financial year ended March 31, 2021 and Final Dividend for the financial year ended March 31, 2020

DIVIDEND

The Board of Directors on October 23, 2020 approved a special dividend of '' 15/- per equity share (i.e. 300%) on par value of '' 5/- each which was paid by the Company to the shareholders whose names were appearing in the Register of Members as on November 2, 2020 being the record date for the payment of dividend. Your Directors are pleased to recommend a final dividend of '' 30/- per share (including a special dividend of '' 15/-per share) on par value of '' 5/- (i.e. 600%), payable to those Shareholders whose names appear in the Register of Members as on the Book Closure Date. Thus, the total dividend for the Financial Year 2020-21 will be '' 45/- per share (i.e. 900%) as against '' 15/- per share (i.e. 300%) in the Financial Year 2019-20.

Your Company has formulated a Dividend Policy which is disclosed on the website of the Company at https:// insights.techmahindra.com/investors/tml-dividend-distribution-policy.pdf

SHARE CAPITAL

During the year under review, your Company allotted 2,407,703 equity shares on the exercise of stock options under various Employee Stock Option Schemes. Consequently, the issued, subscribed and paid-up equity share capital has increased from '' 4,829 million divided into 965,852,364 equity shares of '' 5/- each to '' 4,841 million divided into 968,260,067 equity shares of '' 5/- each.

BUSINESS PERFORMANCE / FINANCIAL OVERVIEW

The Company provides connected experiences, offering innovative and customer-centric information technology experiences, enabling Enterprises, Associates and the Society to Rise™. The Company has over 121,000 professionals in over 90 countries, helping 1,007 global customers including many Fortune 500 companies. The Company’s convergent, digital, design experiences, innovation platforms

and reusable assets connect across a number of technologies to deliver tangible business value and experiences to stakeholders. Your Company also focuses on sustainable business strategy, managing social and environmental impacts, while ensuring that corporate decisions lead to an equitable growth. As a result, Tech Mahindra is one of the three companies from India to be included in the DJSI World Index 2020 and one of the eleven Indian companies in the Emerging markets category.

During the Financial Year 2020-21, the Company’s consolidated revenues increased to '' 378,551 million from '' 368,677 million in the previous year, a growth of 2.7%. The geographic split of revenue is 47.5% from the Americas, 26% from Europe and 26.5% from the Rest of the World.

The consolidated Profit (including other income) before Interest, Depreciation and Tax was at '' 75,846 million, against '' 66,955 million in the previous year.

The consolidated Profit after Tax amounted to '' 43,530 million as against '' 38,974 million in the previous year.

In an age of regular technological disruption, Tech Mahindra is delivering value to its customers with its domain expertise and wide range of offerings in blockchain, machine learning, artificial intelligence, cloud, cyber security, quantum computing and IoT combined with an intimate understanding of each customer and their objectives. The Company has collaborated with industry leaders and startups, academia and partners under TechMNxt charter to provide customized yet simplified solutions for customers.

IMPACT OF COVID-19

The COVID - 19 pandemic that began in Q4 of FY 2019-20, continues to impact people globally, causing healthcare crisis, impacting economies and businesses at large. Economic activity took a backseat as most efforts were channelized in strengthening health infrastructure and supporting weaker sections of the economy. The Company did witness impact in several of its clients, as organizations resorted to cash conservation and reduction of discretionary spending. This impacted demand in the first half of Financial Year 2020-21. Your Company undertook several initiatives to ensuring safety of its people, assets and communities at large. The Company deployed business continuity plans ensuring continues service to customers throughout these tough times. Your

Company realigned its strategy, modified the delivery model and crafted solutions focused on enabling the clients to imagine the future of their business, building and running it for them. This led to a robust demand in the second half of the year, as your Company helped adopt massive technological changes and new business models.

ACQUISITIONS

CERIUM

The Company on April 9, 2020 acquired 51% of the share capital of Cerium Systems Private Limited (Cerium). The enterprise value of Cerium is '' 2,450 million. Cerium is an integrated circuit and embedded software design service provider that is expected to help bolster Tech Mahindra’s capabilities in the areas of semiconductor design and testing, embedded software development / testing and product engineering. The remaining 49% to be acquired over the next three years at a valuation linked to the financial performance of Cerium. During the year, the Company acquired a further 6% stake thereby taking the total shareholding to 57%.

ZEN3

The Company on April 9, 2020, acquired 100% of the share capital of Zen3 for a cash consideration of USD 64 million, out of which USD 35 million was paid upfront, USD 4 million will be paid over two years and maximum upto USD 25 million will be paid over three years linked to financial performance. Zen3 is leading software solution group with strong capabilities in AI enablement services, AI speech solutions, cloud engineering, software product engineering and DevOps. Zen3 has more than 1,300 employees across offices in Seattle, Dublin, Bengaluru, Hyderabad and Vishakhapatnam.

TENZING

The Company acquired 100% of the share capital of Tenzing Ltd and Tenzing Australia Ltd (Tenzing Group) through its wholly owned subsidiary Tech Mahindra (Singapore) Pte Ltd at a consideration of USD 29.5 million including earnouts. The Company is headquartered in Auckland, New Zealand and is engaged in the business of Management Consulting, Digital Transformation and Technology services. It has 145 employees and a turnover of USD 27.4 million. The acquisition will bring strong capabilities primarily in the Insurance vertical along with expanding footprint in the Australia and New Zealand (ANZ) market. The acquisition was completed on December 1, 2020.

MOMENTON

Momenton Pty. Ltd. ("Momenton”) was acquired by the Company through its wholly owned subsidiary viz., Tech Mahindra (Singapore) Pte Limited at a consideration upto AUD 14.3 million including earnouts. The company is headquartered in Melbourne, Australia and has approximately 55 employees. Turnover for the financial year ended 30th June 2020, was AUD 10.8 million. Momenton is a cloud and engineering services provider with a Banking and Financial Services (BFS) focus. The acquisition will enhance Tech Mahindra’s digital transformation capabilities and provide Tech Mahindra a scaled-up presence in the Australian BFS market. This acquisition was completed on 12th February 2021.

PERIGORD

The Company acquired 70% of Perigord Asset Holdings Limited ("Perigord”) through its wholly owned subsidiary Mahindra Engineering Services (Europe) Ltd at a consideration of EUR 21 Million and the remaining 30% will be acquired over the next four years at a valuation linked to financial performance of the company. Perigord is headquartered in Dublin, Ireland with a presence in Germany, USA and India with 380 employees. For the financial year ending 31st December 2020, the company had revenue of EUR 19.5 million The Indian subsidiaries of Perigord were acquired by the Company directly.

Perigord specialized in end to end packaging supply chain solutions to the life sciences industry with services such as packaging artwork & labelling services, strategic consultancy, creative and digital, strategic outsourcing, managed services and software solutions. The acquisition was completed on 15th March, 2021.

PAYMENTS TECHNOLOGY SERVICES LIMITED

The Company announced the acquisition of Payments Technology Services Limited, Hongkong on 12th January 2021 at a consideration of USD 9 million. The company is headquartered in Hong Kong and has approximately 109 employees. Turnover of the Company for the financial year ended 31st December 2019 was USD 5.4 million.

The Payments Technology Services entity is a step-down subsidiary of Fidelity Information Services (FIS). The acquired capabilities in the payments space will give us access to IPs and licenses for two products, which is consistent with the strategy of

pivoting the business towards products and platform implementations as well as participating in the banking transformation programs. This acquisition will open up other opportunities for Tech Mahindra across a number of areas in partnership with FIS.

DIGITALONUS

The Company announced the acquisition of DigitalOnUs, Inc. ("DigitalOnUs”) on 19th April 2021 at an enterprise value of USD 120 million through its wholly owned subsidiary, Tech Mahindra (Americas) Inc. The company is headquartered in San Jose, California, USA. DigitalOnUs is focused on Cloud Native Development and Hybrid Cloud Automation services. The acquisition of DigitalOnUs will enhance Tech Mahindra’s capability in cloud native engineering and position it to develop cutting-edge digital solutions for its customers. DigitalOnUs has more than 380 employees. For the financial year ending 31st December 2020, the company had revenue of USD 30.6 million. The Indian subsidiary of DigitalOnUs namely DigitalOps Technology Private Limited has been acquired by the Company.

EVENTUS

The Company announced the acquisition of Eventus Solutions Group, LLC. ("Eventus”) on April 26, 2021 through its wholly owned subsidiary Tech Mahindra (Americas) Inc. at a consideration of USD 44 million. Eventus provides end-to-end customer engagement solutions, such as strategy consulting, cloud based tools and automation services and managed services. The company is headquartered in Denver, Colorado. It has a turnover of USD 33.2 million in CY2020, with an employee base of around 100 spread across various states in the US.

The acquisition of Payment Technology Services Ltd, DigitalOnUs and Eventus are yet to be consummated on the date of this report.

DETAILS OF SUBSIDIARIES / JOINT VENTURES / ASSOCIATE COMPANIES

The performance and financial position of the subsidiaries, associate companies and joint venture companies included in the consolidated financial statement is provided in accordance with the provisions of Section 129 read with Rule 5 of the Companies (Accounts) Rules, 2014 containing the salient features of the financial statement of Company’s subsidiaries/joint ventures or associate companies in Form AOC - 1 in “Annexure I” to this report.

Pursuant to Rule 8(5)(iv) of the Companies (Accounts) Rules, 2014, the names of the companies which have been incorporated or ceased to be the subsidiaries, joint ventures or associate companies during the year are provided in “Annexure II” to this report. The Company is actively pursuing the initiative on consolidation of its subsidiaries/branches to optimise the operational costs. During the year under review, your Company has closed/merged Eight subsidiaries.

In terms of the provisions of Regulation 24 of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, Tech Mahindra (Americas) Inc. is a wholly owned unlisted material subsidiary of the Company.

The policy for determining material subsidiaries formulated by the Board of Directors is disclosed on the Company’s website and is accessible on https:// insights.techmahindra.com/investors/Policy-For-Determining-Material-Subsidiaries.pdf

UPDATE ON MERGER

The Board of Directors at its meeting held on January 31, 2021 approved the Scheme of Merger of Tech Mahindra Business Services Ltd and Born Commerce Private Ltd with the Company. Accordingly, the companies filed the applications before Hon’ble National Company Law Tribunal (NCLT), Mumbai and Chennai Benches respectively. The applications are pending for admission as on the date of this Report.

HUMAN RESOURCES

Your Company has taken several initiatives in the development of human resources, the most important asset of the Company. Some of the initiatives taken in this area are -

Wellness: Putting Well-being at the Forefront

Since 2017, your Company has been leading a unique corporate wellness program called "Wellness Before Business” that has helped prioritize health as the foundation of its associates’ professional, personal, and spiritual well-being. Your Company was able to adapt faster to the challenges of the COVID-19 pandemic, with all actions aligned to this belief. It also gave birth to the mantra of #WellnessFirst and encouraged mental & virtual connect amongst teams while remaining physically apart. Your Company launched the AMIGO Program for holistic emotional and mental wellness for associates and their dependents. Your Company conducted daily health sessions for mental (psychological experts with byte sized videos), emotional (stay connected virtually while

maintaining social distance) and physical (how to stay healthy and fit) wellness. By transitioning to virtual wellness services, daily sessions with experts and incentivizing wellness benefits, your Company has encouraged its associates stay distant, yet connected.

Pandemic: Enabling Work from Home

Your Company was amongst the first to publicly express the need for staying distant and being safe with a logo tweak, the "e” in "Tech Mahindra” being boxed inside a home. Your Company formed Rapid Action Task forces at different locations for business continuity and enabling work from home. These teams helped in collaborating with government authorities, complying with health advisories, implementing best practices like travel restrictions and defining local emergency protocols. Your Company also rolled out several new policies like Remote Workstation set up, Laptop Rental, Special COVID-19 Leave Benefit, Insurance cover for Home Quarantine and Vaccination Cost Reimbursement to support working from home. Associates were also provided with infrastructure support for networking and security requirements. To make associates and managers accustomed to working from home, the WFH101 program was launched within a week of the lockdown. These activities enabled over 90% of associates to work from home productively within 72 hours of the government’s lockdown announcement.

Leadership: Peacetime Leaders to Wartime Generals

The COVID-19 pandemic changed the leadership paradigm and style of functioning. Your Peacetime Leaders became Wartime Generals. Like in war, one does not have the luxury of time to mull over decision making, the pandemic called for leaders to become agile, think fast and act faster. It meant being focused and yet open to revisiting strategies, taking bold risks, judiciously deploying resources and above all, working tirelessly till the war was won! This new model of ‘Wartime Generals’ is what your Company sought to create. These new leaders helped rally their teams, kept the team engaged and communicated clear, crisp messages frequently while challenging conventional thinking. Your Company has launched a real-time Performance Management System for its top 300 leaders to drive a high-performance culture which ensures that key business initiatives and leaders’ goals are in-sync and tracked regularly. Your Company has also setup five transformation offices and identified 36 strategic initiatives along with output metrics, targets and RACI.

Communication: Frequent, Transparent and Empathetic

With associates working from home, your Company faced natural challenges in ensuring that a distributed workforce stayed connected. Your Company communicated with urgency, transparency and empathy to help associates adjust to the constantly changing conditions crises bring and to maintain a single source of truth. Your Company created a live microsite to prioritize consistent and continuous communication. Your Company launched a daily newsletter called TechM Coronicles that included a video message from a leader, inspirational stories, clarification of rumours, training calendars, associate engagements and customer kudos. Additionally, a new connect series called PrimeTime was introduced to keep associates updated and inspired by external speakers. This was a daily one-hour virtual connect and it featured global leaders from a cross section of industries including Sports, Cinema and Politics. There were close to 150 episodes of Primetime over the course of the year.

Engagement: lovetobeTechM has no boundaries

Your Company used connected technologies to create meaningful experiences for associates working remotely and organized several collaborative activities that included their families. Through the "Each One House One” initiative associates welcomed their colleagues from their neighborhood into their homes. Your Company also facilitated the return of approximately 2000 associates and their families who were stranded abroad through repatriation flights.

Rewards: Nurturing A Culture of Giving

Your Company and its associates believe in driving positive change especially the vulnerable communities impacted during pandemic through individual and Company social responsibility. Last year associates donated ''1.5 million towards social causes - a 105% increase over the previous year. Associates also helped vulnerable communities through voluntary services like grocery/grain distribution, tree plantation and community drives, taking care of migrant workers, donating PPE kits / medical supplies etc. Your Company also facilitated the screening of around 10,000 third-party vendors, associates and members of the partner ecosystem including those working in pantry, sanitation and security departments through the Mhealthy platform. Mhealthy was launched in July 2020 with 32 screening tests, risk profile, access to medical care, antibody test for COVID-19 to secure the workplace. Through these numerous measures,

your Company has continued to recognise the extra ordinary resilience shown by associates through its digital platform that nurtures appreciation and social sharing.

Hiring: Reversing the pyramid

Your Company has taken proactive steps to introduce young talent that will thrive in the ‘new normal.’ With the launch of new programs like LEAP and ELEVATE, your Company gives fresh graduates the flexibility of remote work from home. These programs in addition to the existing ELITE Engineering graduate hiring, Management Trainee program (for hiring fresh talent from B-schools) and Global Leadership Cadre program (for fast-tracking the growth of young leaders) help your Company reverse the pyramid. Your Company has also expanded the use of the #NewAgeDelivery platform in the hiring process by checking for internal talent that are to be released from projects or those already on the bench so as to reduce external hiring costs.

Learning: Becoming Fit4Future

During the year virtual learning picked up momentum as your Company prioritized re-skilling and upskilling through the NAD Learn (formerly Upskilling as a Service) platform. This self-learning ecosystem has offered more than 55,000 associates the opportunity to become full-stack/ full cycle professionals. 20,000 associates are engaged in the RIDE Future Skilling program that is helping your Company transition to new age technologies. Your Company launched EMBARK to train 500 Program Managers on ten special competencies. The top 300 Leaders who completed the Chrysalis program last year had a special 3-month development journey to help them lead during this unprecedented time. Your Company has also helped 400 customers across 31 countries prepare for a post COVID-19 world by sharing best practices and learning content.

Diversity: Creating a sense of Belonging

Your Company reinforced its commitment to being intentionally diverse by becoming a signatory of UN Women and a part of the WEP (Women’s Empowerment Principles) Community. The Women Leaders Program has helped your Company identify more than 50 trailblazers who can drive future business in the ‘new normal.’ Focussed efforts were made towards generational diversity as young leaders were developed through programs like AIM, Ascend and Transcend.

QUALITY

The Company continues its focus on quality and strives to exceed customer expectations at all times. During the year, it continued to strengthen the implementation of CMMI Dev v1.3 (Capability Maturity Model Integration) Dev v1.3 (Capability Maturity Model Integration) (Development) for which the organization is assessed at L5. Similarly it underwent various upgrade and continuous evaluation audits for multiple standards during the year in order to meet client demands and enhance value delivery - Successfully assessed for, CMMI Dev v 1.3, Level 5, ISO 9001:2015 (Quality Management System), ISO 20000-1:2018 (Information Technology Service Management System), ISO 27001:2013 (Information Security Management System), TL9000 R 6.2/ R5.6 (Quality Management Systems for Tele Communications industry), ISO 13485:2016 (Quality Management Systems for medical devices - scope of certification limited to medical devices business within Tech Mahindra), AS9100 Rev D (Standard for Aerospace domain - scope of certification limited to the aerospace business within Tech Mahindra).

In addition to these, your Company also maintains its commitment to health, safety and environment by continually improving its processes in accordance with ISO 14001:2015 (Environmental Management System) and ISO 45001: 2018 (Occupational Health and Safety Assessment Series) standards. Your Company is also certified on ISO 22301:2012 (Societal Security and Business Continuity Management System) and has a comprehensive Business Continuity and Disaster Recovery framework, to prevent potential business disruptions in the event of any disaster. It has processes that helped resume services to customer’s acceptable service levels. Automated Service Desk with SLAs for enabling business and Vulnerability Assessment and Penetration Testing Lab for secured corporate network operations are highlights that showcase the information security posture of the Organization.

During the pandemic year, the entire quality management system was put to test, associates were working from home while complying with all security requirements and able to deliver the services to the desired quality as per customer contractual commitments.

Tech Mahindra (IT Division) has been assessed for the implementation of high maturity business excellence practices at Mahindra Group (Services Sector). It has

been assessed at TMW Maturity Stage 6 (on scale of 1-10 stages) of Mahindra Business Excellence Framework - The Mahindra Way. These certifications are testimony of the robustness of business processes and at large the quality culture imbibed in the organization.

Your Company has continued to strengthen the process for transforming Quality Assurance processes & delivery methods to New Age Delivery processes through the #NewAgeDelivery Engine. This engine focuses on asset creation and re-usability, enabling associates to be rightly skilled through Upskilling as a service, enabling projects and programs to deploy smart planning and crowd sourcing through Capability as a service, providing an automated workflow environment for the associates to execute the project seamlessly through Digital inside and Continuous Delivery. All of this has lead to better customer experience and faster quality delivery. This engine is further strengthened with command center view for the programs and units to access their realtime performance against the targets. Moreover the system is enabled with automated signals and alerts when the performance breaches the threshold for the owner to take corrective actions. The Company is putting all these initiatives in place to ensure that it deliver as stated in its Quality Policy.

DIRECTORS

During the year under review, all Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Independent Directors have also given declaration of compliance with Rules 6(1) and 6(2) of the Companies (Appointment and Qualification of Directors) Rules, 2014, with respect to their name appearing in the data bank of Independent Directors maintained by the Indian Institute of Corporate Affairs.

Pursuant to the provisions of Section 152(6)(c) of the Companies Act, 2013, Dr. Anish Shah is liable to retire by rotation and offers himself for reappointment.

Dr. Anish Shah (DIN: 02719429) who was appointed as an Additional Director with effect from September 10, 2019 has been appointed as Director of the Company at the Annual General Meeting held on July 28, 2020.

Your Directors co-opted Mr. Manoj Bhat (DIN: 05205447) as an Additional Director with effect from 2nd April 2021 whose term will end at the ensuing Annual General Meeting and being eligible offers himself for appointment.

Mr. V.S. Parthasarathy, (DIN: 00125299) resigned as director of the Company with effect from 31st January 2021. Your board places on record its sincere appreciation for the valuable services rendered by Mr. Parthasarathy to the Company during his tenure.

In terms of Regulation 24(1) of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, Mr. T. N. Manoharan, Independent Director of the Company has been appointed as Director in Tech Mahindra (Americas) Inc., a Wholly owned unlisted material subsidiary of the Company with effect from May 21, 2019.

Mr. T. N. Manoharan was also appointed as Lead Independent Director by the Board of Directors at its Meeting held on April 26, 2021.

In the opinion of the Board of Directors the Independent Directors have relevant proficiency, expertise and experience.

FAMILIARISATION PROGRAMME

These programmes aim to provide insights into the Company to enable the Independent Directors to understand its business in depth and contribute significantly to the Company. The details of program for familiarisation of the Independent Directors with the Company are available on the Company’s website and can be accessed at; https://insights. techmahindra.com/investors/tml-familarisation-progarmmes-for-IDs.pdf

The Board members are also regularly updated on changes in the statutory provisions like changes in Corporate Laws, SEBI Regulations, Taxation Laws and People related laws as applicable at the quarterly Board meetings. The Board members are also updated on the Risk universe applicable to the Company’s business. The MD & CEO of the Company had a quarterly session with Board members sharing updates about the Company’s business strategy, operations and the key trends in the IT industry that are relevant for the Company. These updates help the board members in keeping abreast of the key changes and their impact on the Company.

BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and Regulation 19 read with Schedule II, Part D of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has devised a policy on evaluating the performance of the Board of Directors, the Chairman, Committees, and Individual Directors. The evaluation process was carried out through a web-based portal. The summary of the evaluation reports was presented to the respective Committees and the Board. The Directors had a positive feedback on the overall functioning of the Committees and the Board. The suggestions made by the Directors in the evaluation process have been suitably incorporated in the processes.

NUMBER OF MEETINGS OF THE BOARD

The Board met seven times during the financial year 2020-21. The meeting details are provided in Corporate Governance report that forms part of this Annual Report. The maximum interval between any two meetings did not exceed 120 days as prescribed in the Companies Act, 2013 and SEBI Listing Regulations.

POLICY ON DIRECTORS’ APPOINTMENT AND REMUNERATION

The Governance policies laid down by the Board of Directors of your Company include:

i. Policy on appointment and removal of Directors, Key Managerial Personnel and Senior Management.

ii. Policy on remuneration to the Directors, Key Managerial Personnel and Senior Management and other Employees.

The extract of these two policies are provided in “Annexure III”.

The policies are available on the Company’s website on https://insights.techmahindra.com/investors/ Governance-Policies-including-remuneration-to-Directors-KMPS.pdf

SUCCESSION PLAN

In accordance with the principles of transparency and consistency, your Company has adopted governance policies for its Board of Directors, Key Managerial Personnel & senior management appointments, remuneration and evaluation. In line with these Governance policies, the Company has

established a formal Succession Planning Program for key managerial persons across the organization. The Board evaluates all such plans at a regular intervals and institutes a formal program for filling any such critical position. The Board evaluates both internal and external candidates for such positions alongwith the recommendations of the Company. The Company also has a leadership development program where it identifies high potential managers, and trains them to take up the positions of higher responsibilities. The Company has identified the second line of leadership, which provides stability to the business in any contingencies.

TRAINING

The Company has laid down a policy on training for Independent Directors, as part of the governance policies. The Senior Leadership of the Company update the Directors on the regulatory changes, Business strategy and operations periodically.

KEY MANAGERIAL PERSONNEL (KMP)

Pursuant to provisions of Section 203 of the Companies Act, 2013, Mr. C. P Gurnani, Managing Director & Chief Executive Officer, Mr. Manoj Bhat, Chief Financial Officer and Mr. Anil Khatri, Company Secretary & Compliance Officer were the Key Managerial Personnel of the Company during the year under review. Mr. Milind Kulkarni was appointed as Chief Financial Officer of the Company w.e.f. 2nd April 2021.

DIRECTORS’ RESPONSIBILITY STATEMENT

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

i. in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

ii. they have, in the selection of the accounting policies, consulted the Statutory Auditors and these have been applied consistently and, reasonable and prudent judgments and estimates have been made so as to give a true and fair view of the state of affairs of the Company as at March 31, 2021 and of the profit of the Company for the year ended on that date;

iii. proper and sufficient care had been taken 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 other irregularities;

iv. the annual accounts have been prepared on a going concern basis;

v. they had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively;

vi. the proper systems to ensure compliance with the provisions of all applicable laws are in place and are adequate and operating effectively.

DETAILS WITH RESPECT TO ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS

The Company has internal financial controls which are adequate and were operating effectively. The controls are adequate for ensuring the orderly and efficient conduct of the business, including adherence to the Company’s policies, the safe guarding of assets, the prevention & detection of frauds & errors, the accuracy and completeness of accounting records and timely preparation of reliable financial information.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS / PROCEEDINGS

There are no significant and material orders passed by the regulators or courts or tribunal impacting the going concern status and the Company’s operations in the future.

Further no application against the Company has been filed or is pending under the Insolvency and Bankruptcy Code, 2016, nor the Company has done any one time settlement with any Bank or Financial institutions.

STATUTORY AUDITORS

The members, in the 30th Annual General Meeting held on August 1, 2017, appointed B S R & Co. LLP, Chartered Accountants, [Firm’s Registration No. 101248W/W- 100022] as the Statutory Auditors of the Company, to hold office for a term of five years from the conclusion of the 30th Annual General Meeting (AGM) of the Company held in the financial year 201718 until the conclusion of the AGM of the Company for the financial year 2021- 22 on such remuneration as may be determined by the Board of Directors.

The members may note that the Ministry of Corporate Affairs vide notification dated May 07, 2018, has done away with the requirement of yearly ratification of appointment of Statutory Auditors, at the AGM.

Pursuant to Section 139 of the Companies Act, 2013 the statutory auditors B S R & Co. LLP, Chartered Accountants have confirmed that they are eligible to continue as auditors.

There are no qualifications, reservations, adverse remark or disclaimer made in the audit report for the Financial Year 2020-21.

SECRETARIAL AUDIT REPORT

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 had appointed Dr. K. R. Chandratre, Practicing Company Secretary, Pune to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is available at “Annexure IV” to this report. There are no qualifications, reservations, adverse remark or disclaimer made in the Secretarial Audit Report.

COMPLIANCE WITH SECRETARIAL STANDARDS

The Company has complied with the applicable Secretarial Standards.

ANNUAL RETURN

Pursuant to the provisions of Section 92(3) read with Section 134(3) (a) of the Companies Act, 2013, the Annual Return in Form MGT-7 is available at the web link: https://insights.techmahindra.com/investors/mgt7-annual-return-202021.pdf

MANAGERIAL REMUNERATION

Disclosures of the ratio of the remuneration of each director to the median employee’s remuneration and other details as required pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended from time to time, are provided as “Annexure V”.

None of the directors or Managing Director & CEO of the Company, received any remuneration or commission from Subsidiary Companies of your Company.

The details of remuneration paid to the Directors including the Managing Director & CEO of the Company are given in Corporate Governance Report.

PARTICULARS OF EMPLOYEES

The information required under Section 197(12) of the Companies Act, 2013 ("the Act”) read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms part of this Report. However, pursuant to first proviso to Section 136(1) of the Act, this Report is being sent to the Shareholders excluding the aforesaid information. Any shareholder interested in obtaining said information, may write to the Company Secretary at the Registered Office / Corporate Office of the Company and the said information is open for inspection at the Registered Office of the Company.

POLICY ON PREVENTION OF SEXUAL HARASSMENT

Your Company laid down Prevention of Sexual Harassment (POSH) policy which is available on its website. The Company has zero tolerance on Sexual Harassment at workplace. During the year under review there were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

The status of complaints received under POSH and redressed by the POSH Committee of the Company, during the financial year under review, are given below:

a) Number of complaints received - 30

b) Number of complaints redressed - 28

c) Number of complaints pending - 2

The Company carried out focused campaign on POSH and Awareness drives with the help of its BPS teams. Further the employees are required to undertake mandatory certification on POSH to strengthen the POSH awareness and sensitivity.

EMPLOYEE STOCK OPTION SCHEMES

During the year under review, there were no material changes in the Employee Stock Option Schemes (ESOPs) of the Company and the Schemes are in compliance with the SEBI Regulations on ESOPs. As per Regulation 14 of SEBI (Share Based Employee Benefits) Regulations, 2014 read with SEBI circular dated June 16, 2015 the details of the ESOPs are uploaded on the Company’s website; https:// insights.techmahindra.com/investors/Details-of-ESOPs-FY-2020-21.pdf

CORPORATE GOVERNANCE

A report on Corporate Governance covering among others composition, details of meetings of the Board and Committees along with a certificate for compliance with the conditions of Corporate Governance in accordance with the Securities and Exchange Board of India (Listing Obligations And Disclosure Requirements) Regulations, 2015, issued by the Statutory Auditors of the Company, forms part of this Annual Report.

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.

COST RECORDS

Maintenance of cost records and requirement of cost audit as prescribed under the provisions of Section 148 (1) of the Companies Act, 2013 are not applicable for the business activities of the Company.

RISK MANAGEMENT

The Risk Management Committee of the Board of Directors guides the operating management to identify risks, analyze their probability and impact and prepare mitigation plans. It periodically reviews the Risk Management Framework & Enterprise Risk Register which is presented by the Chief Risk Officer. The Company identifies all potential risks, economical, business, currency, operational, climate, governance, financial etc and prepares a mitigation plan for each of the risks. The elements of risk as identified by the Company with the impact and mitigation strategy are set out in the Management Discussion and Analysis Report (MDA).

ESTABLISHMENT OF VIGIL MECHANISM

The Company has laid down Whistle Blower Policy covering Vigil Mechanism with protective Clauses for the Whistle Blowers. The Whistle Blower Policy is made available on the website of the Company.

DEPOSITS / LOANS & ADVANCES, GUARANTEES OR INVESTMENTS

The Company has not accepted any deposits from the public during the year under review. The particulars of loans/advances, guarantees and investments under Section 186 of the Companies Act, 2013 are given in the notes forming part of the Financial Statements.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All transactions entered into with Related Parties as defined under Section 2(76) of the Companies Act, 2013 and Regulation 23 of the Securities and Exchange Board of India (Listing Obligations And Disclosure Requirements) Regulations, 2015, ("The Listing Regulations”), during the financial year under review were in the ordinary course of business and at an arm’s length pricing basis and do not attract the provisions of Section 188 of the Companies Act, 2013. There were no transactions with related parties in the financial year which were in conflict with the interest of the Company and requiring compliance of the provisions of Regulation 23 of the Listing Regulations. Suitable disclosure as required by the Indian Accounting Standards (Ind AS 24) has been made in the notes forming part of the Financial Statements.

The Company has formulated a policy on the materiality of Related Party Transactions and dealing with Related Party Transactions which has been uploaded on the Company’s website and can be accessed at following link https://insights.techmahindra.com/investors/Related-Party-Transactions-Policy.pdf

The particulars of related party transactions in prescribed Form AOC - 2 are attached as “Annexure VI”.

Pursuant to Regulation 23(9) of the Listing Regulations your Company has filed half yearly report on Related Party Transactions with the stock exchanges.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars as prescribed under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 are provided in “Annexure VII” which forms part of this report.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

The CSR vision of the Company is "Empowerment through Education.”

In compliance with the guidelines prescribed under Section 135 of the Companies Act, 2013, your Company has constituted a Corporate Social Responsibility (CSR) Committee of the Board. The CSR policy, covering the Objectives, Focus Areas, Governance Structure Monitoring and Reporting

Framework among others is approved by the Board of Directors. In accordance with the amendments made in Section 135 in January 2021, the CSR Policy has been duly revised and is available at https://files. techmahindra.com/static/img/pdf/csr-policy-techm-v3-march2021.pdf

The Company has spent more than 2% of the average net profits of the Company during the three immediately preceding financial years on CSR. During the year under review, the Company contributed a significant amount towards COVID-19 relief efforts.

The Company’s social initiatives are mainly carried out by Tech Mahindra Foundation and Mahindra Educational Institutions, Section 8 (erstwhile Section 25) Companies promoted by the Company.

TECH MAHINDRA FOUNDATION (TMF)

The Foundation was set up in 2006, as a Section 25 Company (referred to as a Section 8 Company in the Companies Act, 2013). Since then, it has worked tirelessly towards the overarching vision of "Empowerment through Education”, establishing itself as a prominent CSR player within the Mahindra Group as well as a leading social organization at the national level. The Foundation essentially works with children, youth and teachers from disadvantaged urban communities in India, with a special focus on women and persons with disabilities. During the year under review, Tech Mahindra Foundation has successfully implemented 150 high-impact projects with more than 90 partners, directly benefitting 31,767 individuals. In addition, the Foundation reached out to over 1.5 Million people across the country through its COVID Relief efforts.

EDUCATION

The key initiatives in the area of School Education include:

ALL ROUND IMPROVEMENT IN SCHOOL EDUCATION (ARISE)

Tech Mahindra Foundation’s educational initiatives under ARISE are long-term school improvement programmes, in partnership with local governments and partner organisations. The Foundation in 202021 worked with 30 government schools to turn them around into model schools of excellence. Around 6,400 students were covered under this programme.

During the year, the Foundation expanded its work for children with disabilities through its ARISE

programme. This programme is a variant of ARISE in which children with disabilities are provided chronic therapy as well as special education to help them lead more fulfilling lives. Through 25 projects, the programme enabled 2,776 differently-abled students to become better learners and more independent in managing themselves. As the interventions shifted to online mode, 430 students were provided digital tablets to ensure continuity of learning.

SHIKSHAANTAR

Shikshaantar, envisioned as a programme for enhancing capacity of government school teachers, has emerged as an important programme in the education portfolio of the Foundation. TMF works with the Municipal Corporations in East Delhi and North Delhi by running their In-Service Teacher Education Institutes, and during the year under review, as many as 6,378 teachers were trained as part of this initiative. This included specially designed modules for Digital Literacy, Cyber Security and Mental Health that were delivered to the teachers through online sessions.

MOBILE SCIENCE LAB

In order to increase the footprint of its work in education and reach the unreached, TMF launched a unique initiative in 2019-20 - the Mobile Science Lab. For this, a Mahindra bus was remodeled into a science lab on wheels that travelled across schools in East Delhi to provide STEM learning for children in grades 3 and 4. Though the program could not be implemented because of COVID, a second Mobile Science Lab was commissioned through funding received from the National Scheduled Caste Finance & Development Corporation.

EMPLOYABILITY

Skills-for-Market Training (SMART) is the Foundation’s flagship programme in employability. It is built on the vision of an educated, enabled and empowered India, and the belief that educated and skilled youth are the country’s true strength. The programme started with three Centres in 2012 and is currently running over 100 Centres at 11 locations across India. These include SMART Centres, SMART Centres (training for people with disabilities), and SMART-T Centres (training in technical trades).

I n financial year 2020-21, your Company trained 14,394 young women and men under its SMART program, of which, 1,687 were persons with disabilities. Upon successful completion of the course, more than 70% of the graduates are placed in jobs across multiple

industries. A significant achievement for the year was that the average salaries earned by the students increased by over '' 500 per month, despite the severe impact of the pandemic.

The Foundation’s commitment to setting new benchmarks in skill development in India has been underscored by the setting up of Tech Mahindra SMART Academies, which provide the highest quality of skill training to youngsters in Healthcare and Digital Technologies. During FY 2020-21, 1,317 students were enrolled to the four Healthcare Academies in Delhi, Mohali, Mumbai, and Pune, the last of which started functioning in March 2021. In addition, another 710 students were enrolled at the SMART Academies for Digital Technologies in Vizag, Hyderabad and Mohali.

TMF’s work in COVID Relief

As soon as the pandemic broke out in the beginning of the Financial Year, the TMF team shifted its emphasis towards carrying out relief activities for those who were the hardest hit - daily wagers, migrant workers, farmers, persons with disabilities and the transgender community. Through a structured and efficient intervention, the Foundation distributed nearly 6 lakhs ration kits, 3.20 lakhs cooked meals, PPE kits, masks, and medical equipment to hospitals. In all, relief efforts worth '' 14.82 crores were carried out over the year that continued into the current financial year as well. Till date, over 20 lakhs people have benefitted through these efforts.

MAHINDRA EDUCATIONAL INSTITUTIONS (MEI)

MEI - a not-for-profit, 100% subsidiary of the Company has set up Mahindra Ecole Centrale in August 2014 - through a collaborative venture between Mahindra Educational Institutions and Ecole Centrale of Paris, France (now known as Centrale Supelec) and the JNTU Hyderabad - to offer undergraduate engineering programs. Through this strong Indo-French Collaboration with Centrale Supelec and Industry connect with Tech Mahindra, MEC has emerged as a disruptive player in the field of Technical Education.

MEI has sponsored the setting up of Mahindra University to introduce diverse streams of education in addition to Engineering.

MAHINDRA UNIVERSITY

Mahindra University (MU) was notified by the Government of Telangana vide Telangana Ordinance No. 1 of 2020 dated 20th May 2020 as per the

Telangana State Private Universities (Establishment and Regulation) Act, 2018 for "educating future citizens for and of a better world”.

Mr. Anand Mahindra, Chairman of the Company and the Mahindra Group is the Founding Chancellor of the University and he believes that Professional Courses have the greatest potential to contribute to economic inclusivity and sustainable development.

The University will drive a meaningful shift in the way we deliver higher education, besides focusing on infusing emerging technologies into the education space, it will drive interdisciplinary academic excellence, integrating science technology, humanities, ethics, philosophy and design, with purpose. It will also stress on developing multiskilled leaders, who are ethical and empathetic, and capable of reflection as well as innovation.

The University is India’s first to leverage AI & EI (artificial & emotional intelligence) for both education as well as collaboration, across the board.

Besides the existing programs in Civil Engineering, Computer Science Engineering, Electrical & Electronics Engineering, and Mechanical Engineering, the Ecole Centrale School of Engineering is offering 4-year UG programs of study in Electronics & Computer Engineering, Artificial Intelligence, and Computation and Mathematics from academic session 2020-21.

In the 2020 academic session, 657 students were admitted to the University in UG engineering programs, including 42 students in the PhD program in Engineering. Due to constraints imposed by the pandemic, classes had to be held online for most of the academic session.

The University started its accreditation process with submission of requisite documentation to the National Board of Accreditation for the four UG programs in CSE, EEE, Civil and Mechanical Engineering.

The Annual Report on CSR activities is provided as “Annexure VIII”.

SUSTAINABILITY

The pandemic has reinforced the fact that a focused sustainable strategy is needed for business continuity and profitable growth. All businesses have a critical role to play as a source of finance, driving innovation, and ensuring economic growth and employment.

materials. Spread awareness and initiate campaigns on preventing single-use plastic

• Reduce, Reuse, Recycle, Recover: Implement process of Reduce, Reuse, Recycle and Recover across the value chain to limit waste and enable a circular economy

• Sustainable supply chain: Ensure our suppliers follow the highest standard of sustainable and ethical best practices; optimise logistics and transportation to reduce emissions

• Work-life balance: Provide an assured career development path and a feasible and flexi work-life balance to our associates along with a range of associate-friendly policies and processes

• Innovation: Becoming future ready by proactively encouraging Innovative thinking across the organization, adopting technology disruption to reduce emissions and going digital. Developed sustainable solutions with technologies like loT, Automation, Blockchain and AI in sustainability that will help enable a pathway to reduce emissions and other impacts of climate change.

• Green solutions: Investing in Smart grid, Microgrid-As-A-Services, Community Action Platform for Energy, Integrated Electric Vehicle Charging systems, Smart data hubs and Smart Cities for our Customers to reduce their emissions

• Individual Social Responsibility: encourage associates in making sustainability a part of their daily lives even while working from Home

• Transparency: Showcase our organizational policies, processes, risk management along with financial, environmental and social data in the Integrated Reports available online

The commitment and performances are validated by

the external recognition the Company received:

> The only Indian company to be listed in Carbon Clean 200 by Corporate Knights and As You Sow

> The only Indian IT company to score double ‘A’ in CDP Climate and CDP Water

> Included in the Climate Disclosure Project (CDP) Supplier Engagement Leaderboard 2020

The environment, social and governance (ESG) principles built-in the Tech Mahindra long-term growth strategy have helped to mitigate risks and drive profitable growth even in this crisis situation. Adopting resilient strategies and sustainable transformation with a focus on low carbon future have helped the Company to quickly adapt to disruptions and leverage the processes towards Business continuity. The Company’s commitment to environment sustainability, climate change and water security spans the entire business. As a Company with a purpose, it has delivered on its promise to run better, change faster and grow greater while also creating meaningful human experiences for all. The Cpmpany is pursuing plans that will have long-term impacts on the planet and communities, leading to a balance between sustainability and overall business profitability.

With a structured stakeholder engagement process, Tech Mahindra has been able to design strategies and initiatives, which not only improves our sustainability credentials but also reinforces its overall business philosophy. The Company is breaking through new frontiers, turning to renewable energy to achieve ecological balance while ensuring that when it comes to investments, the Company is pioneering new solutions for sustainable development. Your Company emphasis on green eco-system is seen through its commitment to going carbon neutral, making optimum use of resources and moving towards a low emission technology. The profitability of the Comopany is aligned with its principles, allowing to set sustainability milestones on its journey toward a secure future.

Your Company is aligned to the SDGs (Sustainable Development Goals) and its sustainability focus areas are as below:

• Going Carbon Neutral: Increase use of renewable energy through onsite installation and open access; improve energy efficiency through installation of LEDs, sensors; boost green investments by implementing Carbon Price; optimize business travel by enabling virtual meetings; encourage use of public transport and carpool to reduce commute emissions; plant trees to offset carbon footprints; move towards a low carbon economy ensuring environmental protection

• Saying No to plastic: Maintain plastic-free campuses and encourage associates and stakeholders to use eco-friendly & biodegradable

> One amongst only 3 companies from India to be in DJSI World Index 2020

> One of only 11 Indian Companies in DJSI Emerging Markets 2020

> Only Indian company recognized amongst the ‘2021 Global 100 Most Sustainable Corporations’ by Corporate Knights

> Scored A and included in the top 5 of India’s most Sustainable companies by Business World in collaboration with Sustain Labs Paris

> Awarded Gold rating with 94 percentile in 2020 by ECOVADIS

> Constituent of FTSE4Good Index 2020 by Financial Times Stock Exchange-Russell Group

> Winner of Mahindra Group Sustainability Performance Award 2020

> Leaders with 99 percentiles in SUSTAINALYTICS

The Integrated Annual Report is based on various global standards and frameworks like TCFD (Taskforce on Climate Related Financial Disclosures), CDSB (Climate Disclosure Standards Board), SASB (Sustainability Accounting Standard Board) and GRI standards and assured by third party according to ISAE International Standard on Assurance Engagement) 3000 standard.

Tech Mahindra discloses climate-related risks and opportunities in line with the recommendations of TCFD which focusses on the financial impact of climate-related changes on our operations.

The TechM Board is accountable for all risks and opportunities. The MD and CEO of the Company chairs the CSR Committee of the Board and has the ultimate responsibility for Sustainability. He is ably supported by the Chief Sustainability Officer who directly reports to him and Senior Management members of the Sustainability Council who manage all aspects of climate change including climate-related risks and opportunities.

The pandemic has made it imperative to make this a time of change and a time of learning. Your Company embed sustainability into COVID-19 economic recovery, implement their promises and stretch

its commitments to provide for a better and more sustainable future. Tech Mahindra is committed to the SDGs and is transitioning to a low-carbon economy to achieve the goals of Paris agreement. The strategy includes futureproofing its growth against impending changes in policies and regulations and increasing its compliance readiness. The Company is agile and adaptive to dynamic changes in internal and external environment with strategies in place to manage all business and climate change risks in an effective way. The Company has a robust business continuity management framework and incident response team that ensure it is resilient to any climate change risks.

The targets and the metrics used for managing climate related risks and the progress against these targets are disclosed in the externally assured Integrated reports available here- https://www.techmahindra. com/en-in/sustainability/

AWARDS AND RECOGNITION

Your Company continued its quest for excellence in its chosen area of business to emerge as a true global brand. Several awards and rankings continue to endorse your Company as a thought leader in the industry. Few of the Awards / recognitions received by the Company during the year 2020-21 include:

• Tech Mahindra ranked 10th - winner of ATD Best Award in the ‘Other - IT’ category

• Tech Mahindra won Gold Stevie and Bronze Stevie at "2020 Stevie Awards for Great Employers”

• Tech Mahindra’s Mhealthy won ETHealth Award for Best Technology Solution for COVID-19

• Tech Mahindra amongst 50 best workplaces for women by the Great Place to Work Institute.

• Tech Mahindra recognized amongst ‘India’s Top 20 Companies for Sustainability and CSR 2020’ by The Economic Times and Futurescape 7th Responsible Business Rankings during ETSDG Impact Summit 2020.

• Tech Mahindra recognized as a leader in 2020 Gartner Magic Quadrant for IT Services for communications service providers, worldwide.

• Tech Mahindra has featured amongst the Top 10 "Best Companies for Women in India (BCWI)” by Avtar and Working Mother for the third year in a

row and declared ‘Champions of Inclusion’ in the most inclusive companies of India Index.

• Mr. C. P. Gurnani recognized as ‘The Technology Icon of India’ by VARINDIA Brand book on ICT industry.

• Tech Mahindra featured in Fortune India 500 most valuable firms.

• TMF is a winner for the category ‘Best Corporate Foundation COVID-19 Relief Project [Large Impact]’ at the 9th India CSR Awards 2021.

• Tech Mahindra’s Surveillance Solution for Kanpur Smart City is amongst the winners at FICCI India Smart Urban Innovation Awards 2021.

• Tech Mahindra amongst Forbes Top 50 Organizations in Blockchain for 2021.

• Tech Mahindra recognized as a Leader in Gartner 2021 Magic Quadrant for Customer Service BPO.

ACKNOWLEDGEMENTS

Your Directors place on record their appreciation for the contributions made by employees towards the success of your Company more particularly ensuring business as usual in spite of COVID-19 impact. Your Directors gratefully acknowledge the co-operation and support received from the shareholders, customers, vendors, bankers, regulatory and Governmental authorities in India and abroad.

For and on behalf of the Board

Anand G. Mahindra Place: Mumbai Chairman

Date: April 26, 2021 (DIN: 00004695)


Mar 31, 2021

DIRECTORS’ REPORT

Your Directors present Thirty Fourth Annual Report together with the audited accounts of your Company for the year ended March 31, 2021.

FINANCIAL RESULTS (STANDALONE)

('' in Million)

For the year ended March 31

2021

2020

Income

305,627

315,916

Profit Before Interest, Depreciation and Tax

62,521

60,663

Interest

(632)

(667)

Depreciation

(6,623)

(6,674)

Profit Before Tax

55,266

53,322

Provision for Taxation

(12,875)

(7,977)

Profit After Tax

42,391

45,345

Other Comprehensive Income

2,453

(3,234)

Balance brought forward from previous year

184,021

171,952

Transition impact of Ind AS 116, net of tax

-

(78)

Balance

184,021

171,874

Profit available for appropriation

226,432

217,130

Equity Dividends (Including tax on Dividends)

(19,335) 2

(27,522)1

Transfer to retained earnings on account of options lapsed

96

59

Others

-

26

Transferred to Special Economic Zone re-investment reserve (net of utilisation)

(6,319)

(5,540)

Buyback of equity shares (refer note 18(v))

-

(132)

Balance carried forward

200,874

184,021

1 Interim Dividend for the financial year ended March 31, 2020 and Final Dividend for the financial year ended March 31, 2019

2 Interim Dividend (Special Dividend) for the financial year ended March 31, 2021 and Final Dividend for the financial year ended March 31, 2020

DIVIDEND

The Board of Directors on October 23, 2020 approved a special dividend of '' 15/- per equity share (i.e. 300%) on par value of '' 5/- each which was paid by the Company to the shareholders whose names were appearing in the Register of Members as on November 2, 2020 being the record date for the payment of dividend. Your Directors are pleased to recommend a final dividend of '' 30/- per share (including a special dividend of '' 15/-per share) on par value of '' 5/- (i.e. 600%), payable to those Shareholders whose names appear in the Register of Members as on the Book Closure Date. Thus, the total dividend for the Financial Year 2020-21 will be '' 45/- per share (i.e. 900%) as against '' 15/- per share (i.e. 300%) in the Financial Year 2019-20.

Your Company has formulated a Dividend Policy which is disclosed on the website of the Company at https:// insights.techmahindra.com/investors/tml-dividend-distribution-policy.pdf

SHARE CAPITAL

During the year under review, your Company allotted 2,407,703 equity shares on the exercise of stock options under various Employee Stock Option Schemes. Consequently, the issued, subscribed and paid-up equity share capital has increased from '' 4,829 million divided into 965,852,364 equity shares of '' 5/- each to '' 4,841 million divided into 968,260,067 equity shares of '' 5/- each.

BUSINESS PERFORMANCE / FINANCIAL OVERVIEW

The Company provides connected experiences, offering innovative and customer-centric information technology experiences, enabling Enterprises, Associates and the Society to Rise™. The Company has over 121,000 professionals in over 90 countries, helping 1,007 global customers including many Fortune 500 companies. The Company’s convergent, digital, design experiences, innovation platforms

and reusable assets connect across a number of technologies to deliver tangible business value and experiences to stakeholders. Your Company also focuses on sustainable business strategy, managing social and environmental impacts, while ensuring that corporate decisions lead to an equitable growth. As a result, Tech Mahindra is one of the three companies from India to be included in the DJSI World Index 2020 and one of the eleven Indian companies in the Emerging markets category.

During the Financial Year 2020-21, the Company’s consolidated revenues increased to '' 378,551 million from '' 368,677 million in the previous year, a growth of 2.7%. The geographic split of revenue is 47.5% from the Americas, 26% from Europe and 26.5% from the Rest of the World.

The consolidated Profit (including other income) before Interest, Depreciation and Tax was at '' 75,846 million, against '' 66,955 million in the previous year.

The consolidated Profit after Tax amounted to '' 43,530 million as against '' 38,974 million in the previous year.

In an age of regular technological disruption, Tech Mahindra is delivering value to its customers with its domain expertise and wide range of offerings in blockchain, machine learning, artificial intelligence, cloud, cyber security, quantum computing and IoT combined with an intimate understanding of each customer and their objectives. The Company has collaborated with industry leaders and startups, academia and partners under TechMNxt charter to provide customized yet simplified solutions for customers.

IMPACT OF COVID-19

The COVID - 19 pandemic that began in Q4 of FY 2019-20, continues to impact people globally, causing healthcare crisis, impacting economies and businesses at large. Economic activity took a backseat as most efforts were channelized in strengthening health infrastructure and supporting weaker sections of the economy. The Company did witness impact in several of its clients, as organizations resorted to cash conservation and reduction of discretionary spending. This impacted demand in the first half of Financial Year 2020-21. Your Company undertook several initiatives to ensuring safety of its people, assets and communities at large. The Company deployed business continuity plans ensuring continues service to customers throughout these tough times. Your

Company realigned its strategy, modified the delivery model and crafted solutions focused on enabling the clients to imagine the future of their business, building and running it for them. This led to a robust demand in the second half of the year, as your Company helped adopt massive technological changes and new business models.

ACQUISITIONS

CERIUM

The Company on April 9, 2020 acquired 51% of the share capital of Cerium Systems Private Limited (Cerium). The enterprise value of Cerium is '' 2,450 million. Cerium is an integrated circuit and embedded software design service provider that is expected to help bolster Tech Mahindra’s capabilities in the areas of semiconductor design and testing, embedded software development / testing and product engineering. The remaining 49% to be acquired over the next three years at a valuation linked to the financial performance of Cerium. During the year, the Company acquired a further 6% stake thereby taking the total shareholding to 57%.

ZEN3

The Company on April 9, 2020, acquired 100% of the share capital of Zen3 for a cash consideration of USD 64 million, out of which USD 35 million was paid upfront, USD 4 million will be paid over two years and maximum upto USD 25 million will be paid over three years linked to financial performance. Zen3 is leading software solution group with strong capabilities in AI enablement services, AI speech solutions, cloud engineering, software product engineering and DevOps. Zen3 has more than 1,300 employees across offices in Seattle, Dublin, Bengaluru, Hyderabad and Vishakhapatnam.

TENZING

The Company acquired 100% of the share capital of Tenzing Ltd and Tenzing Australia Ltd (Tenzing Group) through its wholly owned subsidiary Tech Mahindra (Singapore) Pte Ltd at a consideration of USD 29.5 million including earnouts. The Company is headquartered in Auckland, New Zealand and is engaged in the business of Management Consulting, Digital Transformation and Technology services. It has 145 employees and a turnover of USD 27.4 million. The acquisition will bring strong capabilities primarily in the Insurance vertical along with expanding footprint in the Australia and New Zealand (ANZ) market. The acquisition was completed on December 1, 2020.

MOMENTON

Momenton Pty. Ltd. ("Momenton”) was acquired by the Company through its wholly owned subsidiary viz., Tech Mahindra (Singapore) Pte Limited at a consideration upto AUD 14.3 million including earnouts. The company is headquartered in Melbourne, Australia and has approximately 55 employees. Turnover for the financial year ended 30th June 2020, was AUD 10.8 million. Momenton is a cloud and engineering services provider with a Banking and Financial Services (BFS) focus. The acquisition will enhance Tech Mahindra’s digital transformation capabilities and provide Tech Mahindra a scaled-up presence in the Australian BFS market. This acquisition was completed on 12th February 2021.

PERIGORD

The Company acquired 70% of Perigord Asset Holdings Limited ("Perigord”) through its wholly owned subsidiary Mahindra Engineering Services (Europe) Ltd at a consideration of EUR 21 Million and the remaining 30% will be acquired over the next four years at a valuation linked to financial performance of the company. Perigord is headquartered in Dublin, Ireland with a presence in Germany, USA and India with 380 employees. For the financial year ending 31st December 2020, the company had revenue of EUR 19.5 million The Indian subsidiaries of Perigord were acquired by the Company directly.

Perigord specialized in end to end packaging supply chain solutions to the life sciences industry with services such as packaging artwork & labelling services, strategic consultancy, creative and digital, strategic outsourcing, managed services and software solutions. The acquisition was completed on 15th March, 2021.

PAYMENTS TECHNOLOGY SERVICES LIMITED

The Company announced the acquisition of Payments Technology Services Limited, Hongkong on 12th January 2021 at a consideration of USD 9 million. The company is headquartered in Hong Kong and has approximately 109 employees. Turnover of the Company for the financial year ended 31st December 2019 was USD 5.4 million.

The Payments Technology Services entity is a step-down subsidiary of Fidelity Information Services (FIS). The acquired capabilities in the payments space will give us access to IPs and licenses for two products, which is consistent with the strategy of

pivoting the business towards products and platform implementations as well as participating in the banking transformation programs. This acquisition will open up other opportunities for Tech Mahindra across a number of areas in partnership with FIS.

DIGITALONUS

The Company announced the acquisition of DigitalOnUs, Inc. ("DigitalOnUs”) on 19th April 2021 at an enterprise value of USD 120 million through its wholly owned subsidiary, Tech Mahindra (Americas) Inc. The company is headquartered in San Jose, California, USA. DigitalOnUs is focused on Cloud Native Development and Hybrid Cloud Automation services. The acquisition of DigitalOnUs will enhance Tech Mahindra’s capability in cloud native engineering and position it to develop cutting-edge digital solutions for its customers. DigitalOnUs has more than 380 employees. For the financial year ending 31st December 2020, the company had revenue of USD 30.6 million. The Indian subsidiary of DigitalOnUs namely DigitalOps Technology Private Limited has been acquired by the Company.

EVENTUS

The Company announced the acquisition of Eventus Solutions Group, LLC. ("Eventus”) on April 26, 2021 through its wholly owned subsidiary Tech Mahindra (Americas) Inc. at a consideration of USD 44 million. Eventus provides end-to-end customer engagement solutions, such as strategy consulting, cloud based tools and automation services and managed services. The company is headquartered in Denver, Colorado. It has a turnover of USD 33.2 million in CY2020, with an employee base of around 100 spread across various states in the US.

The acquisition of Payment Technology Services Ltd, DigitalOnUs and Eventus are yet to be consummated on the date of this report.

DETAILS OF SUBSIDIARIES / JOINT VENTURES / ASSOCIATE COMPANIES

The performance and financial position of the subsidiaries, associate companies and joint venture companies included in the consolidated financial statement is provided in accordance with the provisions of Section 129 read with Rule 5 of the Companies (Accounts) Rules, 2014 containing the salient features of the financial statement of Company’s subsidiaries/joint ventures or associate companies in Form AOC - 1 in “Annexure I” to this report.

Pursuant to Rule 8(5)(iv) of the Companies (Accounts) Rules, 2014, the names of the companies which have been incorporated or ceased to be the subsidiaries, joint ventures or associate companies during the year are provided in “Annexure II” to this report. The Company is actively pursuing the initiative on consolidation of its subsidiaries/branches to optimise the operational costs. During the year under review, your Company has closed/merged Eight subsidiaries.

In terms of the provisions of Regulation 24 of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, Tech Mahindra (Americas) Inc. is a wholly owned unlisted material subsidiary of the Company.

The policy for determining material subsidiaries formulated by the Board of Directors is disclosed on the Company’s website and is accessible on https:// insights.techmahindra.com/investors/Policy-For-Determining-Material-Subsidiaries.pdf

UPDATE ON MERGER

The Board of Directors at its meeting held on January 31, 2021 approved the Scheme of Merger of Tech Mahindra Business Services Ltd and Born Commerce Private Ltd with the Company. Accordingly, the companies filed the applications before Hon’ble National Company Law Tribunal (NCLT), Mumbai and Chennai Benches respectively. The applications are pending for admission as on the date of this Report.

HUMAN RESOURCES

Your Company has taken several initiatives in the development of human resources, the most important asset of the Company. Some of the initiatives taken in this area are -

Wellness: Putting Well-being at the Forefront

Since 2017, your Company has been leading a unique corporate wellness program called "Wellness Before Business” that has helped prioritize health as the foundation of its associates’ professional, personal, and spiritual well-being. Your Company was able to adapt faster to the challenges of the COVID-19 pandemic, with all actions aligned to this belief. It also gave birth to the mantra of #WellnessFirst and encouraged mental & virtual connect amongst teams while remaining physically apart. Your Company launched the AMIGO Program for holistic emotional and mental wellness for associates and their dependents. Your Company conducted daily health sessions for mental (psychological experts with byte sized videos), emotional (stay connected virtually while

maintaining social distance) and physical (how to stay healthy and fit) wellness. By transitioning to virtual wellness services, daily sessions with experts and incentivizing wellness benefits, your Company has encouraged its associates stay distant, yet connected.

Pandemic: Enabling Work from Home

Your Company was amongst the first to publicly express the need for staying distant and being safe with a logo tweak, the "e” in "Tech Mahindra” being boxed inside a home. Your Company formed Rapid Action Task forces at different locations for business continuity and enabling work from home. These teams helped in collaborating with government authorities, complying with health advisories, implementing best practices like travel restrictions and defining local emergency protocols. Your Company also rolled out several new policies like Remote Workstation set up, Laptop Rental, Special COVID-19 Leave Benefit, Insurance cover for Home Quarantine and Vaccination Cost Reimbursement to support working from home. Associates were also provided with infrastructure support for networking and security requirements. To make associates and managers accustomed to working from home, the WFH101 program was launched within a week of the lockdown. These activities enabled over 90% of associates to work from home productively within 72 hours of the government’s lockdown announcement.

Leadership: Peacetime Leaders to Wartime Generals

The COVID-19 pandemic changed the leadership paradigm and style of functioning. Your Peacetime Leaders became Wartime Generals. Like in war, one does not have the luxury of time to mull over decision making, the pandemic called for leaders to become agile, think fast and act faster. It meant being focused and yet open to revisiting strategies, taking bold risks, judiciously deploying resources and above all, working tirelessly till the war was won! This new model of ‘Wartime Generals’ is what your Company sought to create. These new leaders helped rally their teams, kept the team engaged and communicated clear, crisp messages frequently while challenging conventional thinking. Your Company has launched a real-time Performance Management System for its top 300 leaders to drive a high-performance culture which ensures that key business initiatives and leaders’ goals are in-sync and tracked regularly. Your Company has also setup five transformation offices and identified 36 strategic initiatives along with output metrics, targets and RACI.

Communication: Frequent, Transparent and Empathetic

With associates working from home, your Company faced natural challenges in ensuring that a distributed workforce stayed connected. Your Company communicated with urgency, transparency and empathy to help associates adjust to the constantly changing conditions crises bring and to maintain a single source of truth. Your Company created a live microsite to prioritize consistent and continuous communication. Your Company launched a daily newsletter called TechM Coronicles that included a video message from a leader, inspirational stories, clarification of rumours, training calendars, associate engagements and customer kudos. Additionally, a new connect series called PrimeTime was introduced to keep associates updated and inspired by external speakers. This was a daily one-hour virtual connect and it featured global leaders from a cross section of industries including Sports, Cinema and Politics. There were close to 150 episodes of Primetime over the course of the year.

Engagement: lovetobeTechM has no boundaries

Your Company used connected technologies to create meaningful experiences for associates working remotely and organized several collaborative activities that included their families. Through the "Each One House One” initiative associates welcomed their colleagues from their neighborhood into their homes. Your Company also facilitated the return of approximately 2000 associates and their families who were stranded abroad through repatriation flights.

Rewards: Nurturing A Culture of Giving

Your Company and its associates believe in driving positive change especially the vulnerable communities impacted during pandemic through individual and Company social responsibility. Last year associates donated ''1.5 million towards social causes - a 105% increase over the previous year. Associates also helped vulnerable communities through voluntary services like grocery/grain distribution, tree plantation and community drives, taking care of migrant workers, donating PPE kits / medical supplies etc. Your Company also facilitated the screening of around 10,000 third-party vendors, associates and members of the partner ecosystem including those working in pantry, sanitation and security departments through the Mhealthy platform. Mhealthy was launched in July 2020 with 32 screening tests, risk profile, access to medical care, antibody test for COVID-19 to secure the workplace. Through these numerous measures,

your Company has continued to recognise the extra ordinary resilience shown by associates through its digital platform that nurtures appreciation and social sharing.

Hiring: Reversing the pyramid

Your Company has taken proactive steps to introduce young talent that will thrive in the ‘new normal.’ With the launch of new programs like LEAP and ELEVATE, your Company gives fresh graduates the flexibility of remote work from home. These programs in addition to the existing ELITE Engineering graduate hiring, Management Trainee program (for hiring fresh talent from B-schools) and Global Leadership Cadre program (for fast-tracking the growth of young leaders) help your Company reverse the pyramid. Your Company has also expanded the use of the #NewAgeDelivery platform in the hiring process by checking for internal talent that are to be released from projects or those already on the bench so as to reduce external hiring costs.

Learning: Becoming Fit4Future

During the year virtual learning picked up momentum as your Company prioritized re-skilling and upskilling through the NAD Learn (formerly Upskilling as a Service) platform. This self-learning ecosystem has offered more than 55,000 associates the opportunity to become full-stack/ full cycle professionals. 20,000 associates are engaged in the RIDE Future Skilling program that is helping your Company transition to new age technologies. Your Company launched EMBARK to train 500 Program Managers on ten special competencies. The top 300 Leaders who completed the Chrysalis program last year had a special 3-month development journey to help them lead during this unprecedented time. Your Company has also helped 400 customers across 31 countries prepare for a post COVID-19 world by sharing best practices and learning content.

Diversity: Creating a sense of Belonging

Your Company reinforced its commitment to being intentionally diverse by becoming a signatory of UN Women and a part of the WEP (Women’s Empowerment Principles) Community. The Women Leaders Program has helped your Company identify more than 50 trailblazers who can drive future business in the ‘new normal.’ Focussed efforts were made towards generational diversity as young leaders were developed through programs like AIM, Ascend and Transcend.

QUALITY

The Company continues its focus on quality and strives to exceed customer expectations at all times. During the year, it continued to strengthen the implementation of CMMI Dev v1.3 (Capability Maturity Model Integration) Dev v1.3 (Capability Maturity Model Integration) (Development) for which the organization is assessed at L5. Similarly it underwent various upgrade and continuous evaluation audits for multiple standards during the year in order to meet client demands and enhance value delivery - Successfully assessed for, CMMI Dev v 1.3, Level 5, ISO 9001:2015 (Quality Management System), ISO 20000-1:2018 (Information Technology Service Management System), ISO 27001:2013 (Information Security Management System), TL9000 R 6.2/ R5.6 (Quality Management Systems for Tele Communications industry), ISO 13485:2016 (Quality Management Systems for medical devices - scope of certification limited to medical devices business within Tech Mahindra), AS9100 Rev D (Standard for Aerospace domain - scope of certification limited to the aerospace business within Tech Mahindra).

In addition to these, your Company also maintains its commitment to health, safety and environment by continually improving its processes in accordance with ISO 14001:2015 (Environmental Management System) and ISO 45001: 2018 (Occupational Health and Safety Assessment Series) standards. Your Company is also certified on ISO 22301:2012 (Societal Security and Business Continuity Management System) and has a comprehensive Business Continuity and Disaster Recovery framework, to prevent potential business disruptions in the event of any disaster. It has processes that helped resume services to customer’s acceptable service levels. Automated Service Desk with SLAs for enabling business and Vulnerability Assessment and Penetration Testing Lab for secured corporate network operations are highlights that showcase the information security posture of the Organization.

During the pandemic year, the entire quality management system was put to test, associates were working from home while complying with all security requirements and able to deliver the services to the desired quality as per customer contractual commitments.

Tech Mahindra (IT Division) has been assessed for the implementation of high maturity business excellence practices at Mahindra Group (Services Sector). It has

been assessed at TMW Maturity Stage 6 (on scale of 1-10 stages) of Mahindra Business Excellence Framework - The Mahindra Way. These certifications are testimony of the robustness of business processes and at large the quality culture imbibed in the organization.

Your Company has continued to strengthen the process for transforming Quality Assurance processes & delivery methods to New Age Delivery processes through the #NewAgeDelivery Engine. This engine focuses on asset creation and re-usability, enabling associates to be rightly skilled through Upskilling as a service, enabling projects and programs to deploy smart planning and crowd sourcing through Capability as a service, providing an automated workflow environment for the associates to execute the project seamlessly through Digital inside and Continuous Delivery. All of this has lead to better customer experience and faster quality delivery. This engine is further strengthened with command center view for the programs and units to access their realtime performance against the targets. Moreover the system is enabled with automated signals and alerts when the performance breaches the threshold for the owner to take corrective actions. The Company is putting all these initiatives in place to ensure that it deliver as stated in its Quality Policy.

DIRECTORS

During the year under review, all Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Independent Directors have also given declaration of compliance with Rules 6(1) and 6(2) of the Companies (Appointment and Qualification of Directors) Rules, 2014, with respect to their name appearing in the data bank of Independent Directors maintained by the Indian Institute of Corporate Affairs.

Pursuant to the provisions of Section 152(6)(c) of the Companies Act, 2013, Dr. Anish Shah is liable to retire by rotation and offers himself for reappointment.

Dr. Anish Shah (DIN: 02719429) who was appointed as an Additional Director with effect from September 10, 2019 has been appointed as Director of the Company at the Annual General Meeting held on July 28, 2020.

Your Directors co-opted Mr. Manoj Bhat (DIN: 05205447) as an Additional Director with effect from 2nd April 2021 whose term will end at the ensuing Annual General Meeting and being eligible offers himself for appointment.

Mr. V.S. Parthasarathy, (DIN: 00125299) resigned as director of the Company with effect from 31st January 2021. Your board places on record its sincere appreciation for the valuable services rendered by Mr. Parthasarathy to the Company during his tenure.

In terms of Regulation 24(1) of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, Mr. T. N. Manoharan, Independent Director of the Company has been appointed as Director in Tech Mahindra (Americas) Inc., a Wholly owned unlisted material subsidiary of the Company with effect from May 21, 2019.

Mr. T. N. Manoharan was also appointed as Lead Independent Director by the Board of Directors at its Meeting held on April 26, 2021.

In the opinion of the Board of Directors the Independent Directors have relevant proficiency, expertise and experience.

FAMILIARISATION PROGRAMME

These programmes aim to provide insights into the Company to enable the Independent Directors to understand its business in depth and contribute significantly to the Company. The details of program for familiarisation of the Independent Directors with the Company are available on the Company’s website and can be accessed at; https://insights. techmahindra.com/investors/tml-familarisation-progarmmes-for-IDs.pdf

The Board members are also regularly updated on changes in the statutory provisions like changes in Corporate Laws, SEBI Regulations, Taxation Laws and People related laws as applicable at the quarterly Board meetings. The Board members are also updated on the Risk universe applicable to the Company’s business. The MD & CEO of the Company had a quarterly session with Board members sharing updates about the Company’s business strategy, operations and the key trends in the IT industry that are relevant for the Company. These updates help the board members in keeping abreast of the key changes and their impact on the Company.

BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and Regulation 19 read with Schedule II, Part D of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has devised a policy on evaluating the performance of the Board of Directors, the Chairman, Committees, and Individual Directors. The evaluation process was carried out through a web-based portal. The summary of the evaluation reports was presented to the respective Committees and the Board. The Directors had a positive feedback on the overall functioning of the Committees and the Board. The suggestions made by the Directors in the evaluation process have been suitably incorporated in the processes.

NUMBER OF MEETINGS OF THE BOARD

The Board met seven times during the financial year 2020-21. The meeting details are provided in Corporate Governance report that forms part of this Annual Report. The maximum interval between any two meetings did not exceed 120 days as prescribed in the Companies Act, 2013 and SEBI Listing Regulations.

POLICY ON DIRECTORS’ APPOINTMENT AND REMUNERATION

The Governance policies laid down by the Board of Directors of your Company include:

i. Policy on appointment and removal of Directors, Key Managerial Personnel and Senior Management.

ii. Policy on remuneration to the Directors, Key Managerial Personnel and Senior Management and other Employees.

The extract of these two policies are provided in “Annexure III”.

The policies are available on the Company’s website on https://insights.techmahindra.com/investors/ Governance-Policies-including-remuneration-to-Directors-KMPS.pdf

SUCCESSION PLAN

In accordance with the principles of transparency and consistency, your Company has adopted governance policies for its Board of Directors, Key Managerial Personnel & senior management appointments, remuneration and evaluation. In line with these Governance policies, the Company has

established a formal Succession Planning Program for key managerial persons across the organization. The Board evaluates all such plans at a regular intervals and institutes a formal program for filling any such critical position. The Board evaluates both internal and external candidates for such positions alongwith the recommendations of the Company. The Company also has a leadership development program where it identifies high potential managers, and trains them to take up the positions of higher responsibilities. The Company has identified the second line of leadership, which provides stability to the business in any contingencies.

TRAINING

The Company has laid down a policy on training for Independent Directors, as part of the governance policies. The Senior Leadership of the Company update the Directors on the regulatory changes, Business strategy and operations periodically.

KEY MANAGERIAL PERSONNEL (KMP)

Pursuant to provisions of Section 203 of the Companies Act, 2013, Mr. C. P Gurnani, Managing Director & Chief Executive Officer, Mr. Manoj Bhat, Chief Financial Officer and Mr. Anil Khatri, Company Secretary & Compliance Officer were the Key Managerial Personnel of the Company during the year under review. Mr. Milind Kulkarni was appointed as Chief Financial Officer of the Company w.e.f. 2nd April 2021.

DIRECTORS’ RESPONSIBILITY STATEMENT

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

i. in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

ii. they have, in the selection of the accounting policies, consulted the Statutory Auditors and these have been applied consistently and, reasonable and prudent judgments and estimates have been made so as to give a true and fair view of the state of affairs of the Company as at March 31, 2021 and of the profit of the Company for the year ended on that date;

iii. proper and sufficient care had been taken 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 other irregularities;

iv. the annual accounts have been prepared on a going concern basis;

v. they had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively;

vi. the proper systems to ensure compliance with the provisions of all applicable laws are in place and are adequate and operating effectively.

DETAILS WITH RESPECT TO ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS

The Company has internal financial controls which are adequate and were operating effectively. The controls are adequate for ensuring the orderly and efficient conduct of the business, including adherence to the Company’s policies, the safe guarding of assets, the prevention & detection of frauds & errors, the accuracy and completeness of accounting records and timely preparation of reliable financial information.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS / PROCEEDINGS

There are no significant and material orders passed by the regulators or courts or tribunal impacting the going concern status and the Company’s operations in the future.

Further no application against the Company has been filed or is pending under the Insolvency and Bankruptcy Code, 2016, nor the Company has done any one time settlement with any Bank or Financial institutions.

STATUTORY AUDITORS

The members, in the 30th Annual General Meeting held on August 1, 2017, appointed B S R & Co. LLP, Chartered Accountants, [Firm’s Registration No. 101248W/W- 100022] as the Statutory Auditors of the Company, to hold office for a term of five years from the conclusion of the 30th Annual General Meeting (AGM) of the Company held in the financial year 201718 until the conclusion of the AGM of the Company for the financial year 2021- 22 on such remuneration as may be determined by the Board of Directors.

The members may note that the Ministry of Corporate Affairs vide notification dated May 07, 2018, has done away with the requirement of yearly ratification of appointment of Statutory Auditors, at the AGM.

Pursuant to Section 139 of the Companies Act, 2013 the statutory auditors B S R & Co. LLP, Chartered Accountants have confirmed that they are eligible to continue as auditors.

There are no qualifications, reservations, adverse remark or disclaimer made in the audit report for the Financial Year 2020-21.

SECRETARIAL AUDIT REPORT

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 had appointed Dr. K. R. Chandratre, Practicing Company Secretary, Pune to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is available at “Annexure IV” to this report. There are no qualifications, reservations, adverse remark or disclaimer made in the Secretarial Audit Report.

COMPLIANCE WITH SECRETARIAL STANDARDS

The Company has complied with the applicable Secretarial Standards.

ANNUAL RETURN

Pursuant to the provisions of Section 92(3) read with Section 134(3) (a) of the Companies Act, 2013, the Annual Return in Form MGT-7 is available at the web link: https://insights.techmahindra.com/investors/mgt7-annual-return-202021.pdf

MANAGERIAL REMUNERATION

Disclosures of the ratio of the remuneration of each director to the median employee’s remuneration and other details as required pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended from time to time, are provided as “Annexure V”.

None of the directors or Managing Director & CEO of the Company, received any remuneration or commission from Subsidiary Companies of your Company.

The details of remuneration paid to the Directors including the Managing Director & CEO of the Company are given in Corporate Governance Report.

PARTICULARS OF EMPLOYEES

The information required under Section 197(12) of the Companies Act, 2013 ("the Act”) read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms part of this Report. However, pursuant to first proviso to Section 136(1) of the Act, this Report is being sent to the Shareholders excluding the aforesaid information. Any shareholder interested in obtaining said information, may write to the Company Secretary at the Registered Office / Corporate Office of the Company and the said information is open for inspection at the Registered Office of the Company.

POLICY ON PREVENTION OF SEXUAL HARASSMENT

Your Company laid down Prevention of Sexual Harassment (POSH) policy which is available on its website. The Company has zero tolerance on Sexual Harassment at workplace. During the year under review there were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

The status of complaints received under POSH and redressed by the POSH Committee of the Company, during the financial year under review, are given below:

a) Number of complaints received - 30

b) Number of complaints redressed - 28

c) Number of complaints pending - 2

The Company carried out focused campaign on POSH and Awareness drives with the help of its BPS teams. Further the employees are required to undertake mandatory certification on POSH to strengthen the POSH awareness and sensitivity.

EMPLOYEE STOCK OPTION SCHEMES

During the year under review, there were no material changes in the Employee Stock Option Schemes (ESOPs) of the Company and the Schemes are in compliance with the SEBI Regulations on ESOPs. As per Regulation 14 of SEBI (Share Based Employee Benefits) Regulations, 2014 read with SEBI circular dated June 16, 2015 the details of the ESOPs are uploaded on the Company’s website; https:// insights.techmahindra.com/investors/Details-of-ESOPs-FY-2020-21.pdf

CORPORATE GOVERNANCE

A report on Corporate Governance covering among others composition, details of meetings of the Board and Committees along with a certificate for compliance with the conditions of Corporate Governance in accordance with the Securities and Exchange Board of India (Listing Obligations And Disclosure Requirements) Regulations, 2015, issued by the Statutory Auditors of the Company, forms part of this Annual Report.

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.

COST RECORDS

Maintenance of cost records and requirement of cost audit as prescribed under the provisions of Section 148 (1) of the Companies Act, 2013 are not applicable for the business activities of the Company.

RISK MANAGEMENT

The Risk Management Committee of the Board of Directors guides the operating management to identify risks, analyze their probability and impact and prepare mitigation plans. It periodically reviews the Risk Management Framework & Enterprise Risk Register which is presented by the Chief Risk Officer. The Company identifies all potential risks, economical, business, currency, operational, climate, governance, financial etc and prepares a mitigation plan for each of the risks. The elements of risk as identified by the Company with the impact and mitigation strategy are set out in the Management Discussion and Analysis Report (MDA).

ESTABLISHMENT OF VIGIL MECHANISM

The Company has laid down Whistle Blower Policy covering Vigil Mechanism with protective Clauses for the Whistle Blowers. The Whistle Blower Policy is made available on the website of the Company.

DEPOSITS / LOANS & ADVANCES, GUARANTEES OR INVESTMENTS

The Company has not accepted any deposits from the public during the year under review. The particulars of loans/advances, guarantees and investments under Section 186 of the Companies Act, 2013 are given in the notes forming part of the Financial Statements.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All transactions entered into with Related Parties as defined under Section 2(76) of the Companies Act, 2013 and Regulation 23 of the Securities and Exchange Board of India (Listing Obligations And Disclosure Requirements) Regulations, 2015, ("The Listing Regulations”), during the financial year under review were in the ordinary course of business and at an arm’s length pricing basis and do not attract the provisions of Section 188 of the Companies Act, 2013. There were no transactions with related parties in the financial year which were in conflict with the interest of the Company and requiring compliance of the provisions of Regulation 23 of the Listing Regulations. Suitable disclosure as required by the Indian Accounting Standards (Ind AS 24) has been made in the notes forming part of the Financial Statements.

The Company has formulated a policy on the materiality of Related Party Transactions and dealing with Related Party Transactions which has been uploaded on the Company’s website and can be accessed at following link https://insights.techmahindra.com/investors/Related-Party-Transactions-Policy.pdf

The particulars of related party transactions in prescribed Form AOC - 2 are attached as “Annexure VI”.

Pursuant to Regulation 23(9) of the Listing Regulations your Company has filed half yearly report on Related Party Transactions with the stock exchanges.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars as prescribed under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 are provided in “Annexure VII” which forms part of this report.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

The CSR vision of the Company is "Empowerment through Education.”

In compliance with the guidelines prescribed under Section 135 of the Companies Act, 2013, your Company has constituted a Corporate Social Responsibility (CSR) Committee of the Board. The CSR policy, covering the Objectives, Focus Areas, Governance Structure Monitoring and Reporting

Framework among others is approved by the Board of Directors. In accordance with the amendments made in Section 135 in January 2021, the CSR Policy has been duly revised and is available at https://files. techmahindra.com/static/img/pdf/csr-policy-techm-v3-march2021.pdf

The Company has spent more than 2% of the average net profits of the Company during the three immediately preceding financial years on CSR. During the year under review, the Company contributed a significant amount towards COVID-19 relief efforts.

The Company’s social initiatives are mainly carried out by Tech Mahindra Foundation and Mahindra Educational Institutions, Section 8 (erstwhile Section 25) Companies promoted by the Company.

TECH MAHINDRA FOUNDATION (TMF)

The Foundation was set up in 2006, as a Section 25 Company (referred to as a Section 8 Company in the Companies Act, 2013). Since then, it has worked tirelessly towards the overarching vision of "Empowerment through Education”, establishing itself as a prominent CSR player within the Mahindra Group as well as a leading social organization at the national level. The Foundation essentially works with children, youth and teachers from disadvantaged urban communities in India, with a special focus on women and persons with disabilities. During the year under review, Tech Mahindra Foundation has successfully implemented 150 high-impact projects with more than 90 partners, directly benefitting 31,767 individuals. In addition, the Foundation reached out to over 1.5 Million people across the country through its COVID Relief efforts.

EDUCATION

The key initiatives in the area of School Education include:

ALL ROUND IMPROVEMENT IN SCHOOL EDUCATION (ARISE)

Tech Mahindra Foundation’s educational initiatives under ARISE are long-term school improvement programmes, in partnership with local governments and partner organisations. The Foundation in 202021 worked with 30 government schools to turn them around into model schools of excellence. Around 6,400 students were covered under this programme.

During the year, the Foundation expanded its work for children with disabilities through its ARISE

programme. This programme is a variant of ARISE in which children with disabilities are provided chronic therapy as well as special education to help them lead more fulfilling lives. Through 25 projects, the programme enabled 2,776 differently-abled students to become better learners and more independent in managing themselves. As the interventions shifted to online mode, 430 students were provided digital tablets to ensure continuity of learning.

SHIKSHAANTAR

Shikshaantar, envisioned as a programme for enhancing capacity of government school teachers, has emerged as an important programme in the education portfolio of the Foundation. TMF works with the Municipal Corporations in East Delhi and North Delhi by running their In-Service Teacher Education Institutes, and during the year under review, as many as 6,378 teachers were trained as part of this initiative. This included specially designed modules for Digital Literacy, Cyber Security and Mental Health that were delivered to the teachers through online sessions.

MOBILE SCIENCE LAB

In order to increase the footprint of its work in education and reach the unreached, TMF launched a unique initiative in 2019-20 - the Mobile Science Lab. For this, a Mahindra bus was remodeled into a science lab on wheels that travelled across schools in East Delhi to provide STEM learning for children in grades 3 and 4. Though the program could not be implemented because of COVID, a second Mobile Science Lab was commissioned through funding received from the National Scheduled Caste Finance & Development Corporation.

EMPLOYABILITY

Skills-for-Market Training (SMART) is the Foundation’s flagship programme in employability. It is built on the vision of an educated, enabled and empowered India, and the belief that educated and skilled youth are the country’s true strength. The programme started with three Centres in 2012 and is currently running over 100 Centres at 11 locations across India. These include SMART Centres, SMART Centres (training for people with disabilities), and SMART-T Centres (training in technical trades).

I n financial year 2020-21, your Company trained 14,394 young women and men under its SMART program, of which, 1,687 were persons with disabilities. Upon successful completion of the course, more than 70% of the graduates are placed in jobs across multiple

industries. A significant achievement for the year was that the average salaries earned by the students increased by over '' 500 per month, despite the severe impact of the pandemic.

The Foundation’s commitment to setting new benchmarks in skill development in India has been underscored by the setting up of Tech Mahindra SMART Academies, which provide the highest quality of skill training to youngsters in Healthcare and Digital Technologies. During FY 2020-21, 1,317 students were enrolled to the four Healthcare Academies in Delhi, Mohali, Mumbai, and Pune, the last of which started functioning in March 2021. In addition, another 710 students were enrolled at the SMART Academies for Digital Technologies in Vizag, Hyderabad and Mohali.

TMF’s work in COVID Relief

As soon as the pandemic broke out in the beginning of the Financial Year, the TMF team shifted its emphasis towards carrying out relief activities for those who were the hardest hit - daily wagers, migrant workers, farmers, persons with disabilities and the transgender community. Through a structured and efficient intervention, the Foundation distributed nearly 6 lakhs ration kits, 3.20 lakhs cooked meals, PPE kits, masks, and medical equipment to hospitals. In all, relief efforts worth '' 14.82 crores were carried out over the year that continued into the current financial year as well. Till date, over 20 lakhs people have benefitted through these efforts.

MAHINDRA EDUCATIONAL INSTITUTIONS (MEI)

MEI - a not-for-profit, 100% subsidiary of the Company has set up Mahindra Ecole Centrale in August 2014 - through a collaborative venture between Mahindra Educational Institutions and Ecole Centrale of Paris, France (now known as Centrale Supelec) and the JNTU Hyderabad - to offer undergraduate engineering programs. Through this strong Indo-French Collaboration with Centrale Supelec and Industry connect with Tech Mahindra, MEC has emerged as a disruptive player in the field of Technical Education.

MEI has sponsored the setting up of Mahindra University to introduce diverse streams of education in addition to Engineering.

MAHINDRA UNIVERSITY

Mahindra University (MU) was notified by the Government of Telangana vide Telangana Ordinance No. 1 of 2020 dated 20th May 2020 as per the

Telangana State Private Universities (Establishment and Regulation) Act, 2018 for "educating future citizens for and of a better world”.

Mr. Anand Mahindra, Chairman of the Company and the Mahindra Group is the Founding Chancellor of the University and he believes that Professional Courses have the greatest potential to contribute to economic inclusivity and sustainable development.

The University will drive a meaningful shift in the way we deliver higher education, besides focusing on infusing emerging technologies into the education space, it will drive interdisciplinary academic excellence, integrating science technology, humanities, ethics, philosophy and design, with purpose. It will also stress on developing multiskilled leaders, who are ethical and empathetic, and capable of reflection as well as innovation.

The University is India’s first to leverage AI & EI (artificial & emotional intelligence) for both education as well as collaboration, across the board.

Besides the existing programs in Civil Engineering, Computer Science Engineering, Electrical & Electronics Engineering, and Mechanical Engineering, the Ecole Centrale School of Engineering is offering 4-year UG programs of study in Electronics & Computer Engineering, Artificial Intelligence, and Computation and Mathematics from academic session 2020-21.

In the 2020 academic session, 657 students were admitted to the University in UG engineering programs, including 42 students in the PhD program in Engineering. Due to constraints imposed by the pandemic, classes had to be held online for most of the academic session.

The University started its accreditation process with submission of requisite documentation to the National Board of Accreditation for the four UG programs in CSE, EEE, Civil and Mechanical Engineering.

The Annual Report on CSR activities is provided as “Annexure VIII”.

SUSTAINABILITY

The pandemic has reinforced the fact that a focused sustainable strategy is needed for business continuity and profitable growth. All businesses have a critical role to play as a source of finance, driving innovation, and ensuring economic growth and employment.

materials. Spread awareness and initiate campaigns on preventing single-use plastic

• Reduce, Reuse, Recycle, Recover: Implement process of Reduce, Reuse, Recycle and Recover across the value chain to limit waste and enable a circular economy

• Sustainable supply chain: Ensure our suppliers follow the highest standard of sustainable and ethical best practices; optimise logistics and transportation to reduce emissions

• Work-life balance: Provide an assured career development path and a feasible and flexi work-life balance to our associates along with a range of associate-friendly policies and processes

• Innovation: Becoming future ready by proactively encouraging Innovative thinking across the organization, adopting technology disruption to reduce emissions and going digital. Developed sustainable solutions with technologies like loT, Automation, Blockchain and AI in sustainability that will help enable a pathway to reduce emissions and other impacts of climate change.

• Green solutions: Investing in Smart grid, Microgrid-As-A-Services, Community Action Platform for Energy, Integrated Electric Vehicle Charging systems, Smart data hubs and Smart Cities for our Customers to reduce their emissions

• Individual Social Responsibility: encourage associates in making sustainability a part of their daily lives even while working from Home

• Transparency: Showcase our organizational policies, processes, risk management along with financial, environmental and social data in the Integrated Reports available online

The commitment and performances are validated by

the external recognition the Company received:

> The only Indian company to be listed in Carbon Clean 200 by Corporate Knights and As You Sow

> The only Indian IT company to score double ‘A’ in CDP Climate and CDP Water

> Included in the Climate Disclosure Project (CDP) Supplier Engagement Leaderboard 2020

The environment, social and governance (ESG) principles built-in the Tech Mahindra long-term growth strategy have helped to mitigate risks and drive profitable growth even in this crisis situation. Adopting resilient strategies and sustainable transformation with a focus on low carbon future have helped the Company to quickly adapt to disruptions and leverage the processes towards Business continuity. The Company’s commitment to environment sustainability, climate change and water security spans the entire business. As a Company with a purpose, it has delivered on its promise to run better, change faster and grow greater while also creating meaningful human experiences for all. The Cpmpany is pursuing plans that will have long-term impacts on the planet and communities, leading to a balance between sustainability and overall business profitability.

With a structured stakeholder engagement process, Tech Mahindra has been able to design strategies and initiatives, which not only improves our sustainability credentials but also reinforces its overall business philosophy. The Company is breaking through new frontiers, turning to renewable energy to achieve ecological balance while ensuring that when it comes to investments, the Company is pioneering new solutions for sustainable development. Your Company emphasis on green eco-system is seen through its commitment to going carbon neutral, making optimum use of resources and moving towards a low emission technology. The profitability of the Comopany is aligned with its principles, allowing to set sustainability milestones on its journey toward a secure future.

Your Company is aligned to the SDGs (Sustainable Development Goals) and its sustainability focus areas are as below:

• Going Carbon Neutral: Increase use of renewable energy through onsite installation and open access; improve energy efficiency through installation of LEDs, sensors; boost green investments by implementing Carbon Price; optimize business travel by enabling virtual meetings; encourage use of public transport and carpool to reduce commute emissions; plant trees to offset carbon footprints; move towards a low carbon economy ensuring environmental protection

• Saying No to plastic: Maintain plastic-free campuses and encourage associates and stakeholders to use eco-friendly & biodegradable

> One amongst only 3 companies from India to be in DJSI World Index 2020

> One of only 11 Indian Companies in DJSI Emerging Markets 2020

> Only Indian company recognized amongst the ‘2021 Global 100 Most Sustainable Corporations’ by Corporate Knights

> Scored A and included in the top 5 of India’s most Sustainable companies by Business World in collaboration with Sustain Labs Paris

> Awarded Gold rating with 94 percentile in 2020 by ECOVADIS

> Constituent of FTSE4Good Index 2020 by Financial Times Stock Exchange-Russell Group

> Winner of Mahindra Group Sustainability Performance Award 2020

> Leaders with 99 percentiles in SUSTAINALYTICS

The Integrated Annual Report is based on various global standards and frameworks like TCFD (Taskforce on Climate Related Financial Disclosures), CDSB (Climate Disclosure Standards Board), SASB (Sustainability Accounting Standard Board) and GRI standards and assured by third party according to ISAE International Standard on Assurance Engagement) 3000 standard.

Tech Mahindra discloses climate-related risks and opportunities in line with the recommendations of TCFD which focusses on the financial impact of climate-related changes on our operations.

The TechM Board is accountable for all risks and opportunities. The MD and CEO of the Company chairs the CSR Committee of the Board and has the ultimate responsibility for Sustainability. He is ably supported by the Chief Sustainability Officer who directly reports to him and Senior Management members of the Sustainability Council who manage all aspects of climate change including climate-related risks and opportunities.

The pandemic has made it imperative to make this a time of change and a time of learning. Your Company embed sustainability into COVID-19 economic recovery, implement their promises and stretch

its commitments to provide for a better and more sustainable future. Tech Mahindra is committed to the SDGs and is transitioning to a low-carbon economy to achieve the goals of Paris agreement. The strategy includes futureproofing its growth against impending changes in policies and regulations and increasing its compliance readiness. The Company is agile and adaptive to dynamic changes in internal and external environment with strategies in place to manage all business and climate change risks in an effective way. The Company has a robust business continuity management framework and incident response team that ensure it is resilient to any climate change risks.

The targets and the metrics used for managing climate related risks and the progress against these targets are disclosed in the externally assured Integrated reports available here- https://www.techmahindra. com/en-in/sustainability/

AWARDS AND RECOGNITION

Your Company continued its quest for excellence in its chosen area of business to emerge as a true global brand. Several awards and rankings continue to endorse your Company as a thought leader in the industry. Few of the Awards / recognitions received by the Company during the year 2020-21 include:

• Tech Mahindra ranked 10th - winner of ATD Best Award in the ‘Other - IT’ category

• Tech Mahindra won Gold Stevie and Bronze Stevie at "2020 Stevie Awards for Great Employers”

• Tech Mahindra’s Mhealthy won ETHealth Award for Best Technology Solution for COVID-19

• Tech Mahindra amongst 50 best workplaces for women by the Great Place to Work Institute.

• Tech Mahindra recognized amongst ‘India’s Top 20 Companies for Sustainability and CSR 2020’ by The Economic Times and Futurescape 7th Responsible Business Rankings during ETSDG Impact Summit 2020.

• Tech Mahindra recognized as a leader in 2020 Gartner Magic Quadrant for IT Services for communications service providers, worldwide.

• Tech Mahindra has featured amongst the Top 10 "Best Companies for Women in India (BCWI)” by Avtar and Working Mother for the third year in a

row and declared ‘Champions of Inclusion’ in the most inclusive companies of India Index.

• Mr. C. P. Gurnani recognized as ‘The Technology Icon of India’ by VARINDIA Brand book on ICT industry.

• Tech Mahindra featured in Fortune India 500 most valuable firms.

• TMF is a winner for the category ‘Best Corporate Foundation COVID-19 Relief Project [Large Impact]’ at the 9th India CSR Awards 2021.

• Tech Mahindra’s Surveillance Solution for Kanpur Smart City is amongst the winners at FICCI India Smart Urban Innovation Awards 2021.

• Tech Mahindra amongst Forbes Top 50 Organizations in Blockchain for 2021.

• Tech Mahindra recognized as a Leader in Gartner 2021 Magic Quadrant for Customer Service BPO.

ACKNOWLEDGEMENTS

Your Directors place on record their appreciation for the contributions made by employees towards the success of your Company more particularly ensuring business as usual in spite of COVID-19 impact. Your Directors gratefully acknowledge the co-operation and support received from the shareholders, customers, vendors, bankers, regulatory and Governmental authorities in India and abroad.

For and on behalf of the Board

Anand G. Mahindra Place: Mumbai Chairman

Date: April 26, 2021 (DIN: 00004695)


Mar 31, 2021

Your Directors present their Report together with the audited financial statements of your Company for the year ended 31st March, 2021.

A. FINANCIAL AND OPERATIONAL HIGHLIGHTS

(Rs. in crores)

Particulars

2021

2020

Revenue from Operations..............................

45,041

45,488

Other Income..................................................

1,221

1,668

Profit before Depreciation, Finance Costs, Exceptional items and Taxation.....................

7,727

7,466

Less: Depreciation, Amortisation and Impairment Expenses ............................

2,233

2,223

Profit before Finance Costs, Exceptional items and Taxation .........................................

5,494

5,243

Less: Finance Costs..........................................

371

113

Profit before Exceptional items and Taxation...

5,123

5,130

Add: Exceptional items...................................

(3,663)

(2,014)

Profit before Taxation....................................

1,460

3,116

Less: Tax Expense............................................

1,191

1,785

Profit for the year...........................................

269

1,331

Balance of profit for earlier years.................

29,102

28,967

Less: Transfer to Debenture Redemption Reserve ....................................................

_

_

Profits available for appropriation................

29,371

30,298

Add: Other Comprehensive Income/(Loss)* ..

(60)

(8)

Less: Dividend paid on Equity Shares............

292

1,057

Less: Income-tax on Dividend paid................

_

131

Balance carried forward.................................

29,019

29,102

* Remeasurement of (loss)/gain (net) on defined benefit plans, recognised as part of retained earnings.

Financial Year 2021 was one of the worst years for the Indian economy since independence. As per the Second Advanced Estimates of National Income released by the CSO, real economic activity is expected to have contracted by 6.5% during the fiscal as the COVID-19 pandemic took a toll on economic activity. This was the first instance of a contraction since the Financial Year 1980. Nominal per capita income fell quite sharply during the year.

The pandemic hit all segments of the economy quite hard with the manufacturing, construction and services

segments reporting large contractions during the fiscal. Agriculture, however, was the lone bright spot in the economy, growing by 3.6% in the Financial Year 2021. Rural areas were not hit as hard by COVID-19 vis-a-vis urban India. Besides, the Government also proactively intervened and supported this segment by way of cash and kind transfers, record food grain procurement, frontloading rural-related Government spending, hiking MGNREGA spending sharply, initiating a temporary rural works program for returnee migrants and ensuring ample supply of credit. All these measures provided support to the segment. India''s food grain output is estimated to have touched 305.4 million tonnes in Financial Year 2021 which is the highest level ever. Likewise, horticulture output is also pegged at a record level of 326.6 million tonnes during the year.

On the demand side, all drivers of economic activity fared poorly in the Financial Year 2021. Private consumption spending declined sharply owing to a fall in Household incomes while capital formation contracted as the private sector delayed investments owing to weak demand and low capacity utilisation levels. Exports also fell sharply with a contraction in world trade volumes owing to weak demand across the globe.

The Profit for the year before Depreciation, Finance Costs, Exceptional items and Taxation recorded an increase of 3.5% at Rs. 7,727 crores as against Rs. 7,466 crores in the previous year. Profit after tax decreased by 79.8% at Rs. 269 crores as against Rs. 1,331 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.

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

The rampant spread of the Second Wave of COVID-19 and Lockdowns enforced in various States/Parts of the Country coupled with disruption in the supply of oxygen for industrial use, demand and supply for Vehicles and Tractors is expected to be impacted temporarily.

In addition, on the supply side, global shortage of microprocessors (semi-conductors) used in Electronic Control Unit (ECUs) fitted in different components/aggregates for Vehicles continues to pose challenges to the smooth Production Schedules.

The Company''s estimated Sales Volume for the Quarter ending June 2021 is expected to be lower by 15-20% as compared to the fourth quarter of Financial Year 2020-21.

The Revenue and profitability will be impacted in line with the fall in Volumes as mentioned above. However, the Company is taking various cost optimisation measures to limit the adverse impact.

The Company is also carefully reviewing the demand and supply situation and re-calibrating its operations accordingly while protecting the interest of its customers, dealers and suppliers. The endeavour is to ensure optimal level of inventory at plants and dealerships in order to be prepared for a rebound in demand once the situation returns to normalcy.

Performance Review

Automotive Sector

Your Company''s Automotive Sector posted total sales of 3,48,621 vehicles (3,31,384 Passenger vehicles, commercial vehicles and 17,237 three-wheelers) as against a total of 4,71,141 vehicles (4,11,345 four-wheelers and 59,796 three-wheelers) in the previous year, registering a de-growth of 26.0%.

In the domestic market, your Company sold a total of 3,30,271 vehicles as compared to 4,44,218 vehicles in the previous year, resulting in a de-growth of 25.7%.

In the Passenger Vehicle (PV) segment, your Company sold 1,57,215 vehicles [including 1,55,530 Utility Vehicles (UVs), 1,676 Vans and 9 Cars] registering a de-growth of 15.9%, as compared to the previous year''s volume of 1,86,942 vehicles [including 1,79,405 UVs, 6,679 Vans and 858 Cars].

In the Commercial Vehicle (CV) segment, your Company sold 1,56,159 vehicles [including 23,789 vehicles <2T GVW, 1,28,100 vehicles between 2-3.5T GVW, 1,160 Light Commercial Vehicles (LCVs) in the LCV > 3.5T segment, 684 vehicles in the 7.5-16.2T GVW segment and 2,426 Heavy Commercial Vehicles (HCVs)] registering a de-growth of 21.6% over the previous year''s volume of 1,99,131 vehicles [including 36,475 vehicles < 2T GVW, 1,51,384 vehicles between 2-3.5T GVW, 5,415 LCVs in the LCV > 3.5T segment, 760 vehicles in the 7.5-16.2T GVW segment and 5,097 HCVs].

In the three-wheeler segment, your Company sold 16,897 three-wheelers, registering a de-growth of 70.9% over the previous year''s volume of 58,145 three-wheelers.

For the year under review, the Indian automotive industry (except 2W) de-grew by 15.3%, with the PV industry de-growth of 2.2% and CV industry degrowth of 20.8%. The UV segment was the only segment to show growth in Financial Year 2021 with 12.1%. Within the CV industry, the LCV goods <3.5T segment de-grew by 11.0% while the HCV goods segment de-grew by 14.5%.

Your Company''s UV volumes stood at 1,55,530 units, a de-growth of 13.3%. The UV market share for your Company stood at 14.7%. For the year under review, your Company''s PV volume stood at 1,57,215 units with a market share of 5.8%. The stylish and off-roader New Thar launched in October 2020, performed well in the UV segment with a volume of 14,186 units for the Financial Year 2021. Scorpio, XUV500 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 a 41.5% market share. Your Company sold a total of 1,51,889 vehicles in this segment. Your Company has a market share of 56.8% in the LCV 2-3.5T segment, which is the Pik-UP segment.

In the Medium and Heavy Commercial Segment (MHCV) segment, your Company sold 3,110 trucks as against 5,857 in the previous year. This is a de-growth of 46.9%. Your Company''s market share in the HCV segment stands at 2.8%.

Your Company is the pioneer for Electric Vehicles (EVs) in India, and for the year under review, sold (along with its subsidiary Mahindra Electric Mobility Limited) 5,418 EVs (27 four wheelers and 5,391 three-wheelers) as against 14,602 EVs (966 four wheelers and 13,636 three-wheelers) in the previous year.

During the year under review, your Company posted an export volume of 18,350 vehicles as against the previous year''s exports of 26,923 vehicles. This is a de-growth of 31.8%.

The spare parts sales for the year stood at Rs. 2,165.3 crores (including exports of Rs. 133.5 crores) as compared to Rs. 2,494.5 crores (including exports of Rs. 230.8 crores) in the previous year, registering a de-growth of 13.2%.

Farm Equipment Sector

Your Company''s Farm Equipment Sector recorded total sales of 3,54,498 tractors (domestic export) as against 3,01,915 tractors sold in the previous year, registering a growth of 17.4%. This includes 3,067 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 highest ever sales of 8,99,407 tractors, a growth of 26.9%. Tractor Industry recorded growth in Financial Year 2021 after a de-growth in Financial Year 2020.

In the domestic market, your Company sold 3,43,833 tractors (including Gromax Agri Equipment Limited), as compared to 2,91,901 tractors in the previous year, recording a growth of 17.8%. It is the highest ever volume sold for your Company. Given the COVID-19 situation, the Company faced constraints on supply chain and supplier capacity; hence market share is not a good performance indicator for Financial Year 2021. With the market share at 38.2%, the Company continues to be the market leader for the 38th 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 10,665 tractors which is a growth of 6.5% over the previous year.

Spare parts net sales for the year stood at Rs. 758.2 crores (including exports of Rs. 48.8 crores) in Financial Year 2021 as compared to Rs. 718.2 crores (including exports of Rs. 42.4 crores) in the previous Financial year 2020, registering a growth of 5.6%.

Other Businesses Mahindra Powerol

Under the Powerol brand, your Company has been a leader in providing power back-up solutions to the telecom industry for over a decade. To cater to the

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changing customer needs, your Company continues to consolidate its presence in tele-infra management and in the energy management solutions space. In the overall genset business, your Company is No. 2 brand by volume, offering a wide range of solutions from Lower KVA range to mid to higher KVA range.

Your Company is also focusing on Gas Powered Gensets and presently offers solutions in 25 to 125 KVA range.

In addition to lowering emission, these gensets offer a significantly lower operating cost. This segment will be the future growth area.

With a focus on green energy solutions, your Company also offers Energy Storage Solutions powered with Lithium-ion batteries. These are for application in telecom towers and bank ATMs. With the evolving BS IV engine demands, your Company''s Industrial Equipment vertical has already taken the first mover advantage and introduced various nodes to its customers.

Despite the pandemic, Powerol was offering relentless service and support to emergency services like healthcare, telecom, etc.

Construction Equipment Business

For the year under review, your Company (under the Mahindra EarthMaster brand) sold 681 Backhoe Loaders (BHLs) as compared to 880 in the Financial Year 2020, which is a de-growth of 22.6%. The Construction Equipment industry recovered in the second quarter onwards. With the increasing focus and spend in infrastructure sector by the Government, the BHL market in India grew by 21% over the previous year.

Your Company also has presence in the road construction equipment business through motor graders (under the Mahindra RoadMaster brand). During the year under review, your Company sold 82 motor graders.

Two-Wheeler Business

In line with the strategy for the two-wheeler business, your Company through its subsidiary, Classic Legends Private Limited 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. A new addition to that range - JAWA Perak was launched in the Financial Year 2019-20 and the sale of the same started in the Financial Year 2020-21.

Current Year’s review

During the period 1st April, 2021 to 27th May, 2021, 43,414 vehicles were produced as against 2,656 vehicles and 38,959 vehicles were dispatched as against 2,700 vehicles during the corresponding period in the last year. During the same period 55,904 tractors were produced and 55,682 tractors dispatched as against 8,445 tractors produced and 9,307 tractors dispatched during the corresponding period in the previous year.

The world continues to recover from the biggest crisis it has faced in the modern times. Vaccination drives have been initiated across major economies since January 2021 and the pace of vaccination would be critical to support economic recovery in the medium term particularly as one country after another continue to reel under fresh waves of infections and newer strains of the virus. The IMF expects global economic activity to rebound with projections of a 6% growth in 2021 after a 3.3% contraction in 2020. The strength of the recovery varies across countries, depending upon the severity of the crisis, the extent of disruptions and the effectiveness of policy support.

The RBI expects India''s economic activity to rebound quite strongly, with a growth projection of 10.5% for the Financial Year 2022. Both, fiscal and monetary policy have lent support to India''s growth recovery in Financial Year 2021 and this support is expected to continue through Financial Year 2022. The Financial Year 2022 Union Budget clearly focused on growth, not just for now but also for the medium term with a laser focus on reviving investment demand. Government Capex has significantly higher multipliers than other forms of spending and would play an important role in substituting and even crowding in private investments in the economy at a time when private sector investment demand is likely to remain subdued. The RBI cut rates, infused significant liquidity and eased regulatory burden to support the economy and has guided that it would continue with the accommodative stance as long as necessary to sustain growth on a durable basis.

The ongoing second wave of infections since end-February 2021 with many States imposing localised lockdowns and restrictions and any future fresh waves of infections, like those seen in other major economies, impart downside risks and huge uncertainty to the growth trajectory. However, rapid mass vaccination and timely fiscal and monetary support could provide the necessary backstop to economic activity.

Finance

Financial Year 2020-21 was an unprecedented year by all means, as the outbreak of COVID-19 pandemic not only resulted in the loss of countless human lives, it also impacted the global trade and commerce severely. Most major economies entered recession during the year, as widespread lockdown measures to contain the spread of the pandemic brought business activities to a standstill. Leave aside interest rates, it was the year in which even ''oil'' treaded into the negative territory. The global output declined by 3.3% in the calendar year 2020, as per IMF estimates, and most of the major economies, except China, registered a negative growth.

In order to support the battered economies, Central Banks came to the forefront, announcing massive rate cuts and stimulus measures, doling out trillions of dollars to pump growth. Policy easing by the Central Banks was timely, swift, significant in scale and most importantly coordinated. Meanwhile, Central Governments juggled to maintain the right balance between containing the spread of the pandemic through strict lockdown measures and re-opening the economies to boost consumption.

Unfazed by the subdued business activity, the equity markets across the world roared back from the March 2020 lows and rose sharply during the later part of the year. The gains in the equity markets were driven by prospects of synchronous growth recovery in 2021-22, fuelled by sustained fiscal policy support and further aided by a global vaccination drive.

The year 2020 saw global bond yields plunge to record lows amidst large scale rate cuts and accommodative monetary policy stance of Central Banks to aid growth and counter the impact of COVID-19 pandemic. Yields have risen sharply since end-2020 across the globe, led by US, as inflation pressures are rising across. As Bond yields surge, markets are seen to be discounting the Central Banks'' assurances of continued accommodative monetary policy.

Commodity prices also witnessed an unabated rally during the year, with most of commodities touching record highs in the pandemic-stricken year. However, this was not before COVID-19 had caused widespread declines in commodity prices in the first half of Calendar Year 2020. The rally since then has been fuelled by a strong economic recovery in China, massive fiscal and monetary stimulus, stronger push towards renewable energy, supply side disruptions and the return of commodities as an asset class amidst economic uncertainty.

As the year 2020 drew to a close, the ramp up of global vaccination drive provided optimism about a strong vaccine-led growth recovery in 2021. However, this crisis will likely leave scars well into medium term as labour markets take time to heal, investment is held back by uncertainty and Balance Sheet problems. As per the latest IMF estimates, the global economy is expected to rebound by 6% in 2021 but would moderate to 4.4% in 2022 for the aforementioned reasons.

The global community still confronts extreme social and economic strain, with the rising human toll worldwide amidst the resurgence of COVID-19 wave. Moreover, burgeoning debt and deficits, rising inflation and impact of unwinding of quantitative easing are some key risks that persist.

On the domestic front, India also witnessed sharp slowdown during the year. The Central Government announced strict nationwide lockdown in March 2020, which was followed by several localized lockdowns across States during the course of the year.

Reserve Bank of India further cut repo rate by 40 bps in the Financial Year 2020-21, having already cut the rates by a cumulative of 160 bps in the preceding year. Moreover, RBI announced several liquidity boosting measures including targeted long-term repo operations, moratorium of loans, etc. The interest rates had fallen sharply in money market due to the liquidity glut, resulting in real lending rates to fall to decade lows.

Extraordinary, novel and out of box measures taken by Reserve Bank of India to mitigate the impact of pandemic have anchored financial stability and cushioned the damaging effects of COVID-19 on economic activity.

Indian economy experienced subdued 1st half of Financial Year 2021, however it started seeing good recovery in 2nd half of Financial Year 2021. Sensex reflected growth sentiments as it wrapped 2020 on a bullish note by gaining 16% from a record low of March 2020. However, after close to six months of a receding case count, India is witnessing a rise in the COVID-19 cases and the resultant partial/complete lockdowns by States, to counter the rising cases, is expected to dent the ongoing economic recovery.

The Financial Year 2020-21 has been a roller-coaster ride for the rupee due to COVID-19. The pandemic induced massive sell-off in the equity market led the rupee breach record low of 76.90. However, easing of lockdown restrictions, infusion of stimulus by Government and central banks all over the world, optimism over vaccine,

enthused investors resulting in sustained foreign fund inflows, helped rupee vault back to 72 zone.

In the Financial Year 2021, Foreign portfolio investment (FPI) in India was at a 6-year high with record inflows into the equity markets and marginal outflows from the debt markets. The total FPI inflows into the equity, debt and hybrid markets during the Financial Year 2021 was at $36.1 billion compared with the previous two years of outflows of $5.5 billion in the Financial Year 2019 and $3 billion in the Financial Year 2020.

Your Company continued to monitor the liquidity situation carefully. Given the unprecedented impact that COVID-19 had on the business, the Company borrowed funds to shore up liquidity as a precautionary measure. During the year, your Company raised long term borrowings of Rs. 5,536.59 crores by way of a mix of both, market instrument like Non-Convertible Debentures and Bank Loans. Additionally, short term borrowings of Rs. 2,376.90 crores were raised by issuance of Commercial Papers and availing of bank lines during the year. This ensured sufficient liquidity to manage the adverse effects of pandemic. Since the economic activity improved from June-July 2020, your Company saw robust operating cash flows. As the year drew close to an end, sufficient liquidity prompted pre/ repayment of some of the borrowings. During the year, your Company repaid Rs. 3,387.41 crores of the total borrowings (long term, short term borrowing and lease liabilities). As on 31st March, 2021, Rs. 7,642.07 crores of Long-Term borrowing (including current maturities and lease liabilities) and Rs. 24.74 crores of Short Term borrowing was outstanding. With a high liquidity level of Rs. 10,743.89 crores as at 31st March, 2021, your Company is better placed to tide over the impact of the re-surge in COVID-19 cases on the business, if any.

The Company''s 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 total Debt to Equity Ratio is 0.22 as at 31st March, 2021.

Your Company has been rated by CRISIL 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 Debenture ("NCD") programme, CRISIL, ICRA and India Ratings have re-affirmed their

credit ratings of CRISIL AAA/Stable, [ICRA]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 SEBI Circular No. SEBI/HO/DDHS/CIR/P/2018/144 dated 26th November, 2018.

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 2021, the year characterised by a lot of uncertainty amongst pandemic and lockdowns, your Company increased its interaction with investors through video and audio conference calls. The top management, including the Managing Director, Deputy Managing Director and Group CFO and Executive Director-Auto & Farm Sectors, spent significant time to interact with investors to communicate the strategic direction of the business, capital allocation policy and the way the Company was handling COVID-19 crisis. All the four quarterly earnings calls conducted during the year were also well attended by investors and analysts. Apart from the earning calls, the Company also had a special investor/analyst call to discuss the implications of strategic steps being taken by your Company.

During the year, your Company interacted with around 1,079 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. Your Company also engages with investors on Environment, Social and Corporate Governance (ESG), which has received excellent feedback from investors and ESG analysts. Your Company was awarded The Institute of Chartered Accountants of India''s prestigious Gold Shield Award for its Integrated Annual Report of Financial Year 2020.

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.

Despite the pandemic, your Company was able to deliver a good operational performance during the period under review. While the performance has been good, the Profit After Tax was low on account of exceptional items.

Your Directors, considering the good performance, a strong cash flow and this being a milestone 75th Year of your Company, decided to recommend a Dividend of Rs. 8.75 (175%) per Ordinary (Equity) Share of the face value of Rs. 5 each on the Share Capital out of the accumulated balance of retained earnings representing the accumulated surplus in the profit and loss account as at 31st March, 2021.

The equity dividend outgo for the Financial Year 2020-21 would absorb a sum of Rs. 1,087.79 crores [as against Rs. 292.15 crores comprising the dividend of Rs. 2.35 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 Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations") is attached as Annexure I and forms part of this Annual Report.

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 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/FY21/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, has reported a consolidated operating revenue of Rs. 37,855 crores in the current year as compared to Rs. 36,868 crores in the previous year, an increase of 3%. Its consolidated profit after tax after non-controlling interests is Rs. 4,428 crores as compared to Rs. 4,033 crores in the previous year, registering an increase of 10%.

The Group''s finance company, Mahindra & Mahindra Financial Services Limited (Mahindra Finance), reported a consolidated operating income of Rs. 12,050 crores during the current year as compared to Rs. 11,883 crores in the previous year, registering a growth of 1%. The consolidated profit after tax after non-controlling interests for the year is Rs. 773 crores as compared to Rs. 1,075 crores in the previous year.

Mahindra Lifespace Developers Limited, the subsidiary in the business of real estate and infrastructure registered a consolidated operating income of Rs. 166 crores as compared to Rs. 611 crores in the previous year. The consolidated loss after tax after non-controlling interest for the year is Rs. 72 crores as compared to a loss of Rs. 193 crores in the previous year.

Mahindra Holidays & Resorts India Limited, the subsidiary in the business of timeshare registered a consolidated operating income of Rs. 1,730 crores as compared to Rs. 2,372 crores in the previous year. The consolidated loss after tax after non-controlling interests for the year is Rs. 13 crores as compared to a loss of Rs. 132 crores in the previous year.

Mahindra Logistics Limited, a listed subsidiary in the logistics business has registered a consolidated operating income of Rs. 3,264 crores as compared to Rs. 3,471 crores in the previous year. The consolidated profit after tax after non-controlling interests for the year is Rs. 30 crores as compared to Rs. 55 crores in the previous year.

Ssangyong Motor Company, the Korean subsidiary of the Company (under the Companies Act, 2013), treated as discontinued operation for the purpose of consolidation, has reported consolidated operating revenues of Rs. 18,763 crores in the current fiscal year (January 2020 to December 2020) as compared to Rs. 21,707 crores in the previous year. The consolidated loss after tax after non-controlling interests for the year is Rs. 3,208 crores as compared to a consolidated loss of Rs. 2,045 crores in the previous year.

The consolidated profit before exceptional item and tax for the year from continuing operations is Rs. 5,229 crores as against Rs. 4,832 crores in the previous year. The consolidated profit after tax after non-controlling interest and exceptional items for the year from

continuing operations is Rs. 3,347 crores as against Rs. 2,392 crores in the previous year.

The consolidated profit after tax after non-controlling interest and exceptional items for the year from

continuing and discontinued operations is Rs. 1,812 crores as against Rs. 127 crores in the previous year.

During the year under review, Sampo Rosenlew Oy ceased to be an Associate and became a Subsidiary of your Company.

Further, Martial Solren Private Limited, The Birmingham Small Arms Company Limited, BSA Corporation Limited and B.S.A. Motor Cycles Limited became Subsidiaries of your Company.

During the year under review, Graphic Research Design s.r.l., Divine Solren Private Limited, Mahindra Trucks and Buses Limited, Mahindra Automobile Distributor Private Limited, Mahindra First Choice Services Limited and Auto Digitech Private Limited ceased to be Subsidiaries of your Company.

During the year under review, Mahindra Asset Management Company Private Limited changed its name to Mahindra Manulife Investment Management Private Limited and Mahindra Trustee Company Private Limited changed its name to Mahindra Manulife Trustee Private Limited.

Further, Mahindra ''Electoral Trust'' Company, a Section 8 Company has converted itself into a Public Company and changed its name to Mahindra Publications Limited.

Subsequent to the year end, Mahindra Solarize Private Limited became a Subsidiary of your Company.

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/investors/ reports-and-filings

Merger of Mahindra Vehicle Manufacturers Limited into Mahindra & Mahindra Limited

As mentioned in the previous Annual Report, the Board of Directors of the Company at its Meeting held on 29th May, 2019, subject to requisite approvals /consents, approved the Scheme of Merger by Absorption of Mahindra Vehicle Manufacturers Limited, a wholly owned subsidiary of the Company ("MVML") with the Company and their respective shareholders ("Scheme") under the provisions of sections 230 to 232 of the Companies Act, 2013. The Scheme is subject to receipt of approvals from Directorate of Industries, Maharashtra Industrial Development Corporation, National Company Law Tribunal, Mumbai Bench ("NCLT") and such other statutory / Government authorities as may be directed by the NCLT. The Appointed Date of the Scheme is 1st April, 2019 and the entire assets and liabilities of MVML would be transferred to and recorded by the Company at book values. The entire share capital of MVML is held by the Company. Upon the Scheme being effective, all shares (''Preference and Equity'') held by the Company in MVML shall stand cancelled, without any further act or deed and no consideration shall be issued on merger. NCLT has approved the Scheme basis its Pronouncement of Order on 26th April, 2021. However, the certified copy of the order is awaited.

Scheme of Merger by Absorption of Mahindra Trucks and Buses Limited and Mahindra Automobile Distributor Private Limited with Mahindra Two Wheelers Limited (“Scheme”)

The National Company Law Tribunal has approved the Scheme vide its order dated 30th June, 2020. The Appointed Date of the Scheme is 1st April, 2019 and the Scheme is effective from 31st July, 2020. Pursuant to the Scheme becoming effective, Mahindra Trucks and Buses Limited and Mahindra Automobile Distributor Private Limited ceased to be subsidiaries of the Company.

Divestment of 100% stake in Mahindra First Choice Services Limited (“MFCS”) and Auto Digitech Private Limited (“ADPL”) by Mahindra Holdings Limited (“MHL”) to TVS Automobile Solutions Private Limited (“TASL”)

During the year, MHL, a 100% subsidiary of your Company agreed to divest its 100% stake in MFCS and ADPL to TASL for a consideration of Rs. 35 crores. Your Company invested the same amount in TASL for an upfront stake of around 2.76% and an earn-out right and potential. On 25th February, 2021, your Company was allotted 3,32,195 Series IV Compulsorily Convertible Preference Shares ("CCPS") in TASL for Rs. 34.99 crores and consequently MHL divested 100% equity stake in MFCS and Optionally Convertible Redeemable Preference Shares held in ADPL to TASL. Accordingly, both MFCS and ADPL ceased to be subsidiaries of your Company. On 26th February, 2021, the Company acquired additional 100 earn-out shares (i.e. Series V CCPS) for Rs. 0.01 crores.

Scheme of Merger by Absorption of Mahindra Electric Mobility Limited, a subsidiary of the Company with the Company and their respective Shareholders

The Board of Directors of the Company at its Meeting held on 26th March, 2021, subject to requisite permissions/ approvals/consents, accorded its in-principle approval for consolidation of Mahindra Electric Mobility Limited ("MEML"), a subsidiary of the Company into the Company. This consolidation is part of the Company''s Electric Vehicle ("EV") strategy to simplify the structure and re-organise its EV operations into two focused verticals of Last Mile Mobility and EV Tech Centre. With the electric vehicle business at an inflection point and poised to grow exponentially, the realignment will help in providing resources and direction to realize targeted growth.

Subsequent to the year end, the Board of Directors of the Company at its Meeting held on 28th May, 2021, subject to requisite approvals/consents, approved the Scheme of Merger by Absorption of MEML with the Company and their respective Shareholders ("Scheme") under sections 230 to 232 and other applicable provisions of the Companies Act, 2013. The Appointed Date of the Scheme is 1st April, 2021 or such other date as may be directed or approved by the National Company Law Tribunal or any other appropriate authority. The entire assets and liabilities

of MEML would be transferred to and recorded by the Company as per applicable accounting standards. The Scheme provides for issue of Ordinary (Equity) Shares by the Company to the shareholders of MEML (other than the Company or subsidiary(ies) of the Company holding shares directly and jointly with its nominee shareholders).

The share exchange Ratio is 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. Fractional entitlements to be rounded off to the next higher whole number.

The shares held in MEML by the Company or its subsidiary(ies) directly and jointly with its nominee shareholders, shall be cancelled upon the Scheme becoming effective.

Additionally, the stock options held by the eligible ESOP holders of MEML as on the Record Date shall be substituted with ESOPs of the Company in accordance with the Scheme.

Scheme of Merger by Absorption of Mahindra Engineering and Chemical Products Limited, Retail Initiative Holdings Limited and Mahindra Retail Limited with the Company and their respective Shareholders

Subsequent to the year end, the Board of Directors of the Company at its Meeting held on 28th May, 2021, subject to requisite approvals/consents, approved the Scheme of Merger by Absorption of Mahindra Engineering and Chemical Products Limited ("First Transferor Company" or "MECPL"), Retail Initiative Holdings Limited ("Second Transferor Company" or "RIHL") and Mahindra Retail Limited ("Third Transferor Company" or "MRL") (together referred to as ''Transferor Companies''), direct/indirect wholly owned subsidiaries of the Company, with the Company and their respective Shareholders ("Scheme") under sections 230 to 232 and other applicable provisions of the Companies Act, 2013. The Appointed Date of the Scheme would be 1st April, 2021 or such other date as may be directed or approved by the National Company Law Tribunal or any other appropriate authority.

The entire assets and liabilities of MECPL, RIHL and MRL are to be transferred to and recorded by the Company at their carrying values. All inter-company balances and investments amongst MECPL, RIHL, MRL and the

Company will stand cancelled as a result of the proposed merger. The entire share capital of the Transferor Companies is held directly/indirectly by the Company. Upon the Scheme becoming effective, no shares of the Company shall be allotted in lieu or exchange of the holding of the Company in the First Transferor Company or one Transferor Company in another Transferor Company (held directly and jointly with its nominee shareholders) and accordingly, equity shares held in the Transferor Companies shall stand cancelled on the Effective Date without any further act, instrument or deed.

Investment in Carnot Technologies Private Limited

During the year, your Company increased its shareholding in Carnot Technologies Private Limited ("Carnot"), from 22.9% to 48.05% on a fully diluted basis, for an aggregate consideration of Rs. 12 crores comprising of primary infusion in the Company of Rs. 3 crores and secondary purchase from its shareholders of Rs. 9 crores. Carnot is an Indian Company engaged in the business of research and development, related to IOT based products and services. Carnot is expected to support the Company''s strategy by developing information technology solutions for its products, customers and businesses, especially for the Farm Equipment Sector.

Increase of stake in Sampo Rosenlew Oy, Finland (‘’Sampo”)

During the year, the Company''s voting rights in Sampo increased from 49.04% to 79.13%, through conversion of Compulsorily Convertible Preference Shares, acquisition of shares from other shareholders, and primary infusion of capital in Sampo, with a total incremental outlay of Euro 8.5 million (approximately Rs. 72.9 crores). On account of the increase in stake, Sampo ceased to be an Associate and became a Subsidiary of the Company. Harvesting machinery is the second largest category in the global farm equipment industry. The Company''s scale in tractors and Sampo''s expertise in combine harvesters allows both companies to offer a broader product portfolio to address the needs of farmers in various countries. In India, the combine harvester market is currently much smaller than tractors but is growing rapidly with the penetration of mechanisation. Your Company is building a strong position in this product line for India and other export markets.

Termination of Joint Venture discussions with Ford Motor Company

The Company and Ford Motor Company Inc., USA (''Ford'') mutually determined that they will not complete a previously announced Joint Venture between the companies. This followed the passing of the expiration date of the definitive agreements signed between the two companies. This outcome was driven by fundamental changes in global economic and business conditions since the agreement was first announced. Those changes influenced separate decisions by Ford and the Company to reassess their respective capital allocation priorities.

Ssangyong Motor Company (“Ssangyong”)

During the year, the Board of your Company decided not to make any further equity investment in Ssangyong Motor Company, a subsidiary in South Korea. Pursuant to the decision, Ssangyong management initiated a search for a potential investor to invest equity.

During the year under review, the Members of the Company have, by way of a Postal Ballot, approved the proposal of Transfer/Dilution of stake in Ssangyong and/or cessation of control of the Company over Ssangyong.

Following a global search, one North America based investor expressed an interest to invest and acquire a majority stake in Ssangyong. However, a term sheet could not be concluded due to regulatory constraints. Following Ssangyong''s inability to pay bank loans which were due in December, 2020, Ssangyong applied to Korean Courts for commencement of rehabilitation procedure. The Court allowed three months to Ssangyong to arrive at a private investment agreement with the said investor.

Since that could not be concluded within the stipulated time, the Court initiated rehabilitation process on 15th April, 2021 and appointed a Court receiver who took over the day-to-day management of Ssangyong.

An examiner appointed by the Court will determine whether Ssangyong should be sold as a going concern or liquidated. If the examiner recommends a sale, the receiver will oversee the preparation of a rehabilitation plan which may include a combination of capital reduction, debt waiver, debt-to-equity conversion and other similar actions. The rehabilitation plan is expected to be submitted to the Court by July, 2021.

Pursuant to the admission in the Autonomous Restructuring Support (ARS) program and following the guidance under Ind AS 110 - Consolidated Financial

Statements, the Company has ceased consolidating Ssangyong as a subsidiary from 28th December, 2020 and has classified the investment to be measured at fair value as per Ind AS 109 - Financial instruments. Accordingly, the losses from operations, resultant gain on deconsolidation of Ssangyong and impairments/ provisions for the exposures of the Company to Ssangyong have been recognised and presented under ''Profit/(loss) before tax from discontinued operation'' in the Consolidated Statement of Profit and Loss. However, Ssangyong continues to be a subsidiary of the Company under the Companies Act, 2013.

100% shareholding in Meru through primary infusion and secondary share purchase

In December 2019, your Company acquired 36.63% of the equity share capital along with control of Meru Travel Solutions Private Limited ("Meru"), holding company of the Meru Group.

In January 2021, your Company increased its stake in Meru to 43.20% by way of a primary investment of Rs. 15 crores in Meru. Further to this and with the intent of increasing the focus on Mobility Sector, in May 2021 your Company acquired the balance stake from the erstwhile shareholders of Meru for Rs. 97 crores. Meru also redeemed its preference shares held by its then shareholder through proceeds of fresh issue on rights basis which was subscribed by your Company for Rs. 3 lacs. Post the above transactions, Meru is now a wholly owned subsidiary of your Company.

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 Information Management Policy reinforces the control environment. The systems, Standard Operating Procedures and controls are reviewed by Management. These systems and controls are audited by Internal Audit and their findings and recommendations are reviewed by the Audit Committee which ensures the implementation.

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.

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

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 had entered into Material Related Party Transactions i.e. transactions exceeding ten percent of the annual consolidated turnover as per the last audited financial statements, with Mahindra Vehicle Manufacturers Limited, a wholly owned subsidiary of your Company. These transactions too were in the ordinary course of business of your Company and were on arm''s length basis, details of which are disclosed in Form AOC-2 as Annexure II pursuant to the requirements of section 134(3)(h) of the Companies Act, 2013, 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/investors/reports-and-filings.

Statutory Auditors and Auditors’ Report

Messrs B S R & Co. LLP, Chartered Accountants (ICAI Firm Registration Number 101248W/W-100022) were appointed as the Statutory Auditors of the Company to hold office for a term of 5 years from the conclusion of the 71st Annual General Meeting (AGM) held on 4th August, 2017 until the conclusion of the 76th AGM of the Company to be held in the year 2022.

The Auditors'' Report 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 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 2020-21 for all applicable compliances as per Securities and Exchange Board of India 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 as Annexure IV to this Board''s Report.

Secretarial Audit of Material Unlisted Indian Subsidiary

Mahindra Vehicle Manufacturers Limited ("MVML"), a material subsidiary of the Company carried out Secretarial Audit for the Financial Year 2020-21 pursuant to section 204 of the Companies Act, 2013 and Regulation 24A of the Listing Regulations. The Secretarial Audit Report of MVML submitted by Mr. Sachin Bhagwat, Practicing Company Secretary is attached as Annexure V to this Report and does not contain any qualification, reservation or adverse remark or disclaimer.

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 2020-21.

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 2021-22 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.

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. 6 and 36 to the Financial Statements.

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

All the deposits from public and shareholders had already matured as at 31st March, 2017. All the 22 outstanding deposits aggregating Rs. 9.44 lakhs from the public and shareholders as at 31st March, 2021 had matured and had not been claimed as at the end of the Financial Year. 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.

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 is disclosed separately in the Financial Statements of the Company.

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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) Mr. Anand G. Mahindra - Executive Chairman

(b) Dr. Anish Shah - Managing Director and CEO (with effect from 2nd April, 2021)

(c) Mr. Rajesh Jejurikar - Executive Director (Automotive and Farm Sectors)

(d) Mr. Manoj Bhat - Group Chief Financial Officer (appointed with effect from 2nd April, 2021)

(e) Mr. Narayan Shankar - Company Secretary

Dr. Pawan Goenka ceased to be the Managing Director and CEO of the Company with effect from 2nd April, 2021. Dr. Anish Shah was re-designated as Managing Director and CEO of the Company and ceased to be the Group Chief Financial Officer of the Company, with effect from 2nd April, 2021.

Employees’ Stock Option Scheme

During the year under review, 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.

The Company has in force the following Schemes which get covered under the provisions of SEBI (Share Based Employee Benefits) Regulations, 2014 ("SBEB Regulations"):

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

There are no material changes made to the above Schemes and these Schemes are in compliance with the

SBEB Regulations. Your Company''s Auditors, Messrs B S R & Co. LLP, have certified that the Company''s above-mentioned Schemes have been implemented in accordance with the SBEB Regulations, and the Resolutions passed by the Members for the 2000 Scheme and the 2010 Scheme.

Information as required under the SBEB Regulations read with SEBI Circular CIR/CFD/POLICYCELL/2/2015 dated 16th June, 2015 have been uploaded on the Company''s website and can be accessed at the Web-link: https:// www.mahindra.com/resources/FY21/AnnualReport.zip.

Particulars of Employees and related disclosures

The Company had 273 employees who were in receipt of remuneration of not less than Rs. 1,02,00,000 during the year ended 31st March, 2021 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 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 [email protected]. Such details are also available on your Company''s website and can be accessed at the Web-link: https://www.mahindra. com/resources/FY21/AnnualReport.zip.

Disclosures with respect to the remuneration of Directors, 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 VI 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 even during the toughest time of Pandemic.

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 include ''Rise for Associates'', industrial relations skills for frontline officers,

transformational work culture projects, e-compliance, e-portal for reward and recognition of associates, and Code of Conduct for associates. The newly constituted Employee Relations Council is taking forward the work of Transformational Work Culture Committee (TWCC) 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 team effectiveness, individual effectiveness, safety and environment, quality tools, TPM, skill building programs, continuous improvement, result orientation, relationship management, decision making and programs on union leadership development. The Company launched the Success Factors Learning Management System for associates to enable self-paced learning on a digital space.

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. As a result of this effort, till previous year associates from your Company have participated at various international skill competitions which include China Arc Cup 2020, WorldSkills 2019 and Beijing Arc Cup.

One of the Company''s associates won the 1st prize in 135 GMAW process (Welding) in the China Arc Cup 2020. The Company''s associate won the ''Medallion of Excellence'' at the WorldSkills 2019. At the Beijing Arc Cup, the Company''s associate won the bronze medal in finished product category and a female associate from your Company was awarded as ''Excellent Female Welder''. However, since Pandemic has grappled the entire globe and countries are struggling to fight back the COVID-19 effect, in Financial Year 2021, all international competitions were put on hold.

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 11.5 ideas per person in the Financial Year 2021 even during the time of uncertainties and even though the plant was non-operational for some time.

This year significant emphasis was also laid towards raising awareness on health and wellness of employees and their family members on protection from COVID-19 under the brand program on "2417 Swasth Raho Mast Raho" over Google Teams platform in addition to regular

annual medical check-ups, health awareness activities. Diet food has become a way of life over the past four years. Your Company maintains an ''Employee Health Index'' at an individual level and this has been a useful tool in identifying employees who require focused 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. Bonus settlements were amicably agreed upon at all locations. The sustained efforts towards building a transformational work culture resulted in zero production loss in the Financial Year 2020-21 and helped create a collaborative, healthy and productive work environment.

Safety, Occupational Health and Environment

During the year under review, your Company revised its Safety, Occupational Health & Environment (SOH&E) Policy and started its implementation as per the new standard, ISO: 45001: 2018. The management commitment towards SOH&E is demonstrated through adoption of new compliance and notifications during the pandemic period along with its voluntary commitments. The Company implemented various initiatives under the new normal guidelines with overall health and hygiene being merged with the SOH&E policy. The achievements were assessed through management reviews from time to time.

At each Plant location, annual events like Road Safety Week, National Safety Day/Month and Fire Service Week were organized virtually. As per new normal, various topics were deployed to train employees on Safety, Health and Environment. Similarly, virtual meetings and training programs were deployed for suppliers, with special focus on safety and fire safety. The training programs were leveraged by sharing small clips to enhance learning.

To strengthen the safety practices, the Company continues to focus on theme-based safety topics including Behavior Based Safety (BBS) Level 2. Additionally, your Company introduced chemical safety management and office fire prevention and protection new standards.

Overall, 16 safety standards for standardization in the M&M group companies are under implementation across all plants.

Your Company carried out statutory Safety audits, Fire Safety Audit, Electrical Safety Audit, Risk Assessment as per updated safety standards. For the year under review, your Company achieved substantial reduction in the fire incidences by reducing fire load. The initiatives in this space include installation of modern equipment and recyclable stores packaging material in critical areas by substituting the flammable material as appropriate.

To eliminate and minimize the overall environmental impact in line with the ''science-based targets'' philosophy, your Company is continuously adopting new techniques. Towards this objective, various projects have been implemented by your Company in air, water-waste water management, solid waste recycling management, plastic waste recycling management and E-waste recycling management. Carbon footprint reduction is achieved by deploying IE3 motors and increasing share of renewable energy. Many of the Company''s new initiatives have been shared by your Company with the supplier community.

During the year under review, your Company started reporting the status under Extended Producer Responsibility Organizations (EPRO) to Central Pollution Control Board. This activity covers integral plastic waste recycling management for all the Company''s plants, Suppliers and Dealers.

Your Company implemented Central Ground Water Authority regulations for ground water recharging and water recycling management. This has helped your Company reduce its freshwater requirement and move towards water neutrality.

Your Company continued its commitment to improve the well-being of employees and contract associates through various activities by screening at all gates and regular distribution of vitamin supplement. Further, strict adherence to usage of PPE, displaying posters of hand washing technique and precautions to be taken, formation of isolation room and hands-free sanitization stands were provided.

Additionally, the Company reduced the sitting capacity in canteen area and sitting capacity in buses by 50%, installed safety screens at each table of canteen, observed distancing at shop floor and promoted more of virtual communications. Exclusive tie-up with various tertiary care hospitals, special tie-up with ambulance services for transferring COVID-19 positive persons to the Quarantine Centre or Hospitals, special tie up with Nightingale for virtual consultation with Doctors,

Medicinal kit and Hygiene kit Development at Mahindra COVID Centers were the additional measures taken by the Company to combat COVID-19.

The Company has successfully treated employees from all Mahindra Group Companies. This includes activities like medical check-post vaccination drive, continuous consultation and counselling on pandemic illness, special advisory publishing for all employees and family members were also conducted. Robust implementation of compliance for Bio medical Waste disposal Management as per pandemic notifications were also carried out.

To create awareness among society at large, your Company has installed a LED display screen that displays consented real time readings for all air, water and hazardous as well as non-hazardous waste generation and disposal limits. This screen is installed just outside the manufacturing plant in Mumbai, which is located on the Western Express highway. In addition, environment protection awareness is generated virtually amongst all stakeholders on an annual basis for World Ozone Day, World Environment Day, World Earth Day, World Water Day and Energy Conservation Week and Water Conservation Week, etc.

Certifications/Recertifications

All Plants of your Company are certified for Standard ISO 45001: 2018 and re-certification of ISO 14001: 2015. Further, all plants have implemented Integrated Management System (IMS), along with updated standard ISO 45001:2018.

All plants of your Company are 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 Company revises its year on year targets under SOH&E, and the performances are reviewed periodically by the senior management. Focused initiatives involving all stakeholders coupled with management reviews have helped your Company to improve SOH&E performance.

Directors

As mentioned in the previous Annual Report, Dr. Pawan Goenka was re-designated as "Managing Director and Chief Executive Officer" with effect from 1st April, 2020 and re-appointed as "Managing Director and Chief Executive Officer" of the Company from 12th November, 2020 to 1st April, 2021.

Dr. Anish Shah was appointed as Whole-time Director designated as "Deputy Managing Director and Group Chief Financial Officer" from 1st April, 2020 to 1st April, 2021 and as the Managing Director of the Company designated as "Managing Director and Chief Executive Officer" from 2nd April, 2021 to 31st March, 2025.

Mr. Rajesh Jejurikar was appointed as Whole-time Director designated as "Executive Director (Automotive and Farm Sectors)" for a period of 5 years from 1st April, 2020 to 31st March, 2025.

Mr. CP Gurnani was appointed as Non-Executive Non-Independent Director of the Company with effect from 1st April, 2020.

Mr. M. M. Murugappan and Mr. Nadir B. Godrej ceased to hold office as Independent Directors of the Company from 8th August, 2020, upon completion of their tenure as approved by the Shareholders at the 72nd Annual General Meeting of the Company held on 7th August, 2018.

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 fulfill 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 the 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 would be undertaking the said test in due course.

Lead Independent Director

Mr. Vikram Singh Mehta, Independent Director and Chairman of Governance, Nomination and Remuneration Committee has been appointed as the Lead Independent Director with effect from 1st April, 2021. The role and responsibilities of the Lead Independent Director are provided in the Corporate Governance Report forming part of the Annual Report.

Re-appointment of Independent Director for a Second Term

The Governance, Nomination and Remuneration Committee, on the basis of performance evaluation of Mr. T. N. Manoharan and taking into account the external business environment, the business knowledge, acumen, experience and the substantial contribution made by him during his tenure, has recommended to the Board that the continued association of Mr. T. N. Manoharan as Independent Director would be beneficial to the Company. Based on the above and his performance evaluation, the Board recommends the re-appointment of Mr. T. N. Manoharan as an Independent Director for a further period of 5 consecutive years commencing from 11th November, 2021 to 10th November, 2026. The Company has received the requisite Notice from a Member in writing proposing his appointment as Independent Director.

Appointment of Independent Directors Ms. Nisaba Godrej

Pursuant to the recommendation of the Governance, Nomination and Remuneration Committee, the Board at its Meeting held on 7th August, 2020 approved appointment of Ms. Nisaba Godrej, as an Additional Director (Independent and Non-Executive) on the Board of Directors of the Company, with effect from 8th August, 2020 to hold office up to the date of the Annual General Meeting of the Company to be held thereafter and subject to the approval of the Members at the said Annual General Meeting, to hold office as an Independent Director for a term of 5 (five) consecutive years commencing from 8th August, 2020 to 7th August, 2025 (both days inclusive).

The Company has received the requisite Notice from a Member in writing proposing her appointment as an Independent Director of the Company.

Mr. Muthiah Murugappan

Pursuant to the recommendation of the Governance, Nomination and Remuneration Committee, the Board at its

Meeting held on 7th August, 2020 approved appointment of Mr. Muthiah Murugappan, as an Additional Director (Independent and Non-Executive) on the Board of Directors of the Company, with effect from 8th August, 2020 to hold office up to the date of the Annual General Meeting of the Company to be held thereafter and subject to the approval of the Members at the said Annual General Meeting, to hold office as an Independent Director for a term of 5 (five) consecutive years commencing from 8th August, 2020 to 7th August, 2025 (both days inclusive).

The Company has received the requisite Notice from a Member in writing proposing his appointment as an Independent Director of the Company.

Completion of tenure of Dr. Pawan Goenka

Dr. Pawan Goenka ceased to hold office as "Managing Director and CEO" of the Company with effect from 2nd April, 2021 upon completion of his tenure as approved by the Shareholders at the 74th Annual General Meeting of the Company. Dr. Goenka also ceased to be a Member of the Board of Directors of the Company with effect from 2nd April, 2021.

Dr. Pawan Goenka joined the Company as General Manager (R&D) in the year 1993. During his R&D tenure he led the development of the Scorpio SUV. He was appointed COO (Automotive Sector) in April 2003, President (Automotive Sector) in September 2005, President (Automotive & Farm Equipment Sectors) in April 2010. Dr. Pawan Goenka was first appointed as an Executive Director and President (AFS) on the Board of the Company on 23rd September, 2013, Executive Director and Group President (AFS) in April 2015, Managing Director of Mahindra & Mahindra Limited, in November 2016 and designated as Managing Director & CEO on 1st April, 2020.

The Company has witnessed phenomenal growth under his leadership. The path through which the Company passed through and the valuable contribution made by him in guiding and shaping the business model and future of the Company and the Group is commendable. He was instrumental in translating the global vision of the Company into a reality.

He has been the Chairman of the Risk Management Committee and Member of the Corporate Social Responsibility Committee, Loans & Investment Committee, Stakeholders Relationship Committee, Research & Development Committee and Sale of Assets Committee of the Board.

The Board placed on record its deep appreciation of the invaluable services rendered by Dr. Pawan Goenka to the Company for over more than 27 illustrious years with the Company.

Quote from Executive Chairman

"Pawan joined your Company in 1993, fresh from a long stint in the USA, wanting to make a career in India but uncertain about how this would work out. From that day to this, he has spent 28 exciting years in the Company. He started as a General Manager reporting to the head of Automotive R&D at Nashik and rose to cap his career as the MD and CEO of your Company. That is an impressive trajectory.

Pawan''s unique combination of engineering skills and commercial acumen have added great value to your Company. Under his leadership, particularly in the area of R&D, your Company produced a stream of products that put us on the automotive map. When he shared the first Scorpio prototype with me, my spontaneous reaction was that I was witnessing the birth of a new era. The Scorpio changed the Company''s DNA, image and fortunes. From the Scorpio to the XUV 700, Pawan has been the driving force behind the quantum leap achieved by the R&D Function in M&M.

Pawan is a role model for many in your Company. His understanding of complex engineering processes along with the demands of the market has been instrumental in translating the Company''s global vision into a reality. His commitment to Quality focus and Customer first is now a part of the folklore of your Company. He has always possessed a natural inclination towards fairness and transparency and has great respect for his own time and the time of others. He believes he can learn from anyone, even the most junior of colleagues. Fostering a meritocracy at Mahindra has always been a priority for him. He is the living embodiment of our Core Values.

He has officially retired, but I know that our loss is going to be society''s gain. Amongst the many activities he has planned, giving back to the community in some form or the other is a large part of his agenda. And although he will devote much less time to our organisation, it is a comfort to know that we will always have access to his experience and wisdom.

I wish Pawan a very happy, productive and fulfilling next chapter in his life. Wherever his destiny takes him, he will always remain a valued part of our Mahindra Group family."

Transition of Mr. Anand G. Mahindra, Executive Chairman to the role of Non-Executive Chairman of the Company with effect from 12th November, 2021

At the 71st Annual General Meeting of the Company, based on the recommendations of the Governance, Nomination and Remuneration Committee of the Board ("GNRC") and the Board of Directors, the Company had appointed Mr. Anand G. Mahindra as Executive Chairman of the Company for a period of 5 (Five) years with effect from 12th November, 2016 upto and including 11th November, 2021.

In line with the requirement of Regulation 17(1 B) of the Listing Regulations, the Board of Directors pursuant to the recommendations of GNRC at its meeting held on 20th December, 2019, had approved the transition of Mr. Anand G. Mahindra, Executive Chairman to the role of Non-Executive Chairman with effect from 1st April, 2020.

Subsequently, pursuant to the Securities and Exchange Board of India ("SEBI") notification dated 10th January, 2020 deferring the deadline for compliance with Regulation 17(1B) of the Listing Regulations from 1st April, 2020 to 1st April, 2022, the GNRC and the Board at their Meetings held on 7th February, 2020 and 8th February, 2020 respectively, unanimously requested Mr. Anand G. Mahindra to continue as the Executive Chairman till his original term of appointment as approved by the Shareholders of the Company i.e. upto 11th November, 2021.

In deference to the wishes of the GNRC and Board, Mr. Anand G. Mahindra had acceded to the request to continue as the Executive Chairman till his original term of appointment i.e. upto 11th November, 2021.

Upon completion of his tenure as Executive Chairman, Mr. Anand G. Mahindra will transit to the role of Non-Executive Chairman of the Company with effect from 12th November, 2021, who shall be liable to retire by rotation. This will further enhance the independence of the Board.

As Non-Executive Chairman, he will serve as mentor and sounding board for the Managing Director and Senior Management especially in the areas of strategic planning, risk mitigation and external interface. He will continue to play an important role in epitomising and building Brand Mahindra. He will be available to provide feedback and counsel to the Managing Director and Senior Management on key issues facing the Company.

Retirement by rotation

Mr. Vijay Kumar Sharma and Mr. CP Gurnani retire by rotation and, being eligible, offer themselves for re-appointment at the 75th Annual General Meeting of the Company scheduled to be held on 6th August, 2021.

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, Deputy Managing Director and Group Chief Financial Officer and Executive Director (Auto and Farm Sectors).

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.

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.

Evaluation of Directors and Board

A separate exercise was carried out by the Governance, Nomination and Remuneration Committee 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 Executive Chairman of the Company 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 of the Company was carried out by the Executive Chairman and other Directors.

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.

Criteria for Chairman

The performance evaluation of Chairman 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.

Criteria for Managing Director and Executive Directors

The performance evaluation of Managing Director and Executive Directors was based on various criteria, inter-alia, including leadership style, standards of integrity, fairness and transparency demonstrated, identification of strategic aim, 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.

Results of Evaluation

The results of evaluation showed high level of commitment and engagement of Board, its various committees and senior leadership. The results of the evaluation were shared with the Board, Chairman of respective Committees and individual Directors. Based on the outcome of the evaluation, the Board and Committees have agreed on an action plan to further improve the effectiveness and functioning of the Board and Committees.

The Directors expressed their satisfaction with the evaluation process. During the year under review, the Committee 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/investors/reports-and-filings.

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 familiarization programmes for its Directors including review of Investments of the Company by Strategic Investment Committee, Industry Outlook at the Board Meetings, Regulatory updates at Board and Audit Committee Meetings covering changes with respect to the Companies Act, 2013, Listing Regulations, Taxation and other matters, Presentations on Internal Control over Financial Reporting, Operational Control over Financial Reporting, Prevention of Insider Trading Regulations, Framework for Related Party Transactions, Plant Visit, Meeting with Senior Executive(s) of your Company, etc. Pursuant to Regulation 46 of the Listing Regulations, the details required are available on the website of your Company at the web link: https://www.mahindra.com/resources/FY21/ 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) i n the preparation of the annual accounts for the Financial Year ended 31st March, 2021, 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 31st March, 2021 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 31st March, 2021;

(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 31st March, 2021.

Board Meetings and Annual General Meeting

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

During the year 1st April, 2020 to 31st March, 2021, seven Board Meetings were held on: 3rd April, 2020, 23rd April, 2020, 12th June, 2020, 7th August, 2020, 10th November, 2020, 5th February, 2021 and 26th March, 2021. The 74th Annual General Meeting (AGM) of the Company was held on 7th August, 2020 through Video Conferencing.

Meetings of Independent Directors

The Independent Directors of your Company meet before the Board Meetings without the presence of the Executive Chairman or the Managing Director or other Non-Independent Director 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 Executive Chairman of the Company (taking into account the views of the Executive and Non-Executive Directors), review the performance of the Company, 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 Board at its Meeting held on 7th August, 2020 re-constituted the Audit Committee and appointed Mr. Vikram Singh Mehta and Mr. Haigreve Khaitan as the Members with effect from 8th August, 2020. Mr. Nadir B. Godrej and Mr. M. M. Murugappan ceased to be the Members of the Committee upon the end of their term. 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.

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.

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 the Annual Report.

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 to enable the Directors, employees and all stakeholders of the Company to report genuine concerns, to provide for adequate safeguards against victimisation of persons who use such mechanism and make provision for direct access to the Chairman of the Audit Committee.

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/investors/reports-and-filings.

Further details are available in the Report on Corporate Governance that forms part of this Annual Report.

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

The Company has a detailed policy in place in line with the requirements of The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 ("Act"). Internal Complaints Committees ("ICC") have been set up to redress complaints received regarding sexual harassment and the Company has complied with provisions relating to the constitution of ICC under the Act. All employees (permanent, contractual, temporary, trainees) are covered under this Policy.

During the year under review, 7 complaints with allegations of sexual harassment were filed and 5 were disposed off as per the provisions of the Act. 2 complaints are pending as of 31st March, 2021.

Business Responsibility Report

The ''Business Responsibility Report'' (BRR) of your Company for the year 2020-21 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 the 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)

This year marks the 75th year of inception of your Company. Over the past seven decades, 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. The core purpose of the Company is to "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".

This year was a particularly challenging year for humanity, with the adverse impact of the COVID-19 pandemic felt by one and all but more so by the vulnerable and marginalized groups on whom the impact has been the hardest. Your Company has invested in a concerted manner to provide COVID-19 relief and rehabilitation with an aim of building resilient communities. Apart from contributing to the Prime Minister''s Citizen Assistance and Relief in Emergency Situations Fund towards the end of Financial Year 2020, the Mahindra Group swiftly responded to the pandemic by putting into action a series of relief initiatives.

Your factories were converted to produce face shields, face masks, sanitizers and aerosol boxes to support the frontline warriors in the fight against the

pandemic. Further, a COVID-19 Relief Fund under the aegis of Mahindra Foundation was set up to provide sustenance grants and in-kind support to those most severely affected by the pandemic e.g. small businesses and traders, daily wage labourers, frontline COVID warriors, etc. Till 31st March, 2021, the Mahindra Group has distributed 4,06,700 face shields, 14,35,950 face masks and 624 aerosol boxes to hospitals and frontline workers including the police force. The Group has also distributed 5,25,068 cooked food packets, and ration and other essentials to 7,03,486 individuals including migrants and communities around its office and factory locations. Your Company also supported Ratna Nidhi Charitable Trust, with the provision of ICU beds for a COVID care centre set up at NESCO in Goregaon, Mumbai, by BMC.

With the objective of building resilient communities, your Company''s long-term focus has been towards supporting the livelihood of communities, particularly migrants, adversely affected by the pandemic. This was done through a partnership with Swades Foundation for providing livelihood (goat rearing and fishing) support to 679 COVID-19 impacted households in Raigad district of Maharashtra. Your Company also entered into a partnership with Naandi Foundation to support 6,000 individuals through an Agri-Entrepreneurship Skilling Programme.

You will be happy to know that your Company has in line with its CSR vision, continued to support the constituencies of girls, youth and farmers through projects in the domains of education, health, and the environment. By investing CSR efforts in these critical constituencies who contribute to nation building and the economy, the Company will enable our stakeholders and communities to RISE.

The impact of some of the CSR projects your Company invested in Financial Year 2021 are shown below:

- Project Nanhi Kali supported the education of over 1,71,950 underprivileged girls through 6,346 Academic Support Centres across 24 locations in 9 states of India. Of these 33,046 girls were supported by your Company, while the Mahindra Group as a whole, supported 73,699 girls.

- Through the support of the Mahindra Group, the Mahindra Pride Schools (MPS) trained 4,342 youth from socially and economically disadvantaged communities across 7 locations in Financial Year 2021. Of these, your Company supported the MPS in Chandigarh, Varanasi, and 2 schools in Chennai, which together skilled 2,520 youth. Further, the Mahindra Group supported training of 92,304 students through 1,816 Mahindra Pride Classrooms (MPC) set up in ITIs, Polytechnics, Arts and Science Colleges across 13 states. Of this, your Company supported the training of 61,677 MPC students. The delivery of instruction was through virtual training thereby complying with the Government regulations with respect to COVID-19.

- Over 12,500 students have benefited through a variety of Scholarship Programs. These ranged from providing opportunities to youth from low income group families to undergo diploma courses at vocational education institutes, to enabling meritorious students to pursue their post graduate studies at reputed universities overseas, to allowing deserving students to study at the Mahindra United World College in Pune.

- Through Mahindra Hariyali, the Mahindra Group planted 1.14 million trees, which contributed to building green cover and protecting the rich biodiversity of the country. Your Company contributed towards plantation of 1 million trees of which

0.90 million trees were planted in the Araku valley, which besides greening the environment also provided livelihood support to tribal farmers growing coffee and fruit bearing trees in this region. Till date, 19.08 million trees have been planted through Mahindra Hariyali, of which 11.68 million trees were planted in Araku to support the livelihood of 25,000 tribal farmer families.

- Your Company entered into a Public Private Partnership (PPP) for an Integrated Water Management Program (IWMP) with Government of Madhya Pradesh at Bhopal and with National Bank for Agriculture and Rural Development (NABARD) at Hatta. Your Company has also partnered with NABARD in Maharashtra for a watershed project in Igatpuri, in Nashik District covering 20 villages, over 13,500 hectares and benefiting a population of more than 23,020 individuals.

- Through the Wardha Farmer Family Project, Prerna and Krishi Mitra Project, your Company continued to support small and marginal farmers by training them in effective farming practices including soil health, resource efficient agriculture, creating model farms with bio-dynamic farming practices, and increasing agricultural income through increasing crop productivity.

- Rise for Safe Roads: Through this first of its kind ''Road Safety'' project in India, your Company aimed to make the Mumbai Pune Expressway a near ''Zero Fatality Corridor'' by 2021. The interventions have been guided by the "4E" principle i.e. Engineering, Enforcement, Education and Emergency Response. In addition, long haul truck drivers were trained through the Anticipatory Driving and Action Prevention Training (ADAPT™) program.

- Despite the challenges posed by the pandemic, our employees continued to drive a positive change by volunteering. The employee volunteering platform provided 31,503 employees across the Group a menu of volunteering opportunities, enabling them to invest 2,72,467 hours towards giving back to society. Of these, 10,184 M&M employees contributed 83,789 hours towards various social causes. Your Company also launched the MySeva initiative, which encouraged employees to extend the spirit of giving in their personal capacity by recognizing their individual acts of social responsibility. Of the total volunteering hours, 51,625 hours was contributed by employees across the Group through the MySeva initiative and the balance were contributed through the ESOPs (Employee Social Options).

During the last Financial Year, your Company''s efforts to drive positive change were acknowledged by various forums and your Company received the following awards:

• India CSR Summit 2020 award for Watershed Management at Zaheerabad Plant and for Project Prerna in Maharashtra, Karnataka.

• SIAM award in Category - Skills & Education for Project Prerna.

• Indo French Chamber of Commerce & Industry (IFCCI) - CSR Award for Project Hariyali in the category of Environment and Sustainability.

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 can be accessed in the Governance section at the Web-link https://www.mahindra.com/investors/reports-and-filings.

CSR Committee

The Board at its Meeting held on 26th March, 2021 re-constituted the Corporate Social Responsibility Committee. Dr. Pawan Goenka ceased to be the Member of the Committee with effect from 2nd April, 2021, upon cessation as a Director of the Company.

Further, the Board at its Meeting held on 28th May, 2021 re-constituted the Corporate Social Responsibility Committee by inducting Mr. Muthiah Murugappan as a Member of the 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 Sustainability activities.

During the year under review, your Company spent Rs. 112,78,17,286 (including a set off of Rs. 20 crores for contributions made by the Company to the PM CARES Fund) 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. 112,56,00,000. The detailed Annual Report on the CSR activities undertaken by your Company in the Financial Year 2021, is annexed herewith marked as Annexure VII.

The Company had contributed a sum of Rs. 20 crores to the PM CARES Fund on 31st March, 2020 in pursuance of MCA''s appeal dated 30th March, 2020 made to the MDs/CEOs of top 1000 companies in terms of market capitalization, to contribute generously to PM CARES Fund.

In terms of the MCA Circular No.CSR-01/4/2021-CSR-MCA dated 20th May, 2021, Mr. Manoj Bhat, Group Chief Financial Officer and BSR & Co., the Statutory Auditors of the Company have certified that the contribution to "PM CARES Fund" was indeed made on 31st March, 2020 in pursuance of the appeal and the same was over and above the mandatory CSR obligation under section 135(5) of the Companies Act, 2013 for Financial Year 2019-20.

The said contribution of a sum of Rs. 20 crores to PM CARES Fund was made by the Company over and above the mandatory CSR obligation under section 135(5) of the Companies Act, 2013 for Financial Year 2019-20, which has been offset against the mandatory CSR obligation for Financial Year 2020-21.

Sustainability

During the year under review, the 13th Sustainability Report for the year 2019-20 was released. The report was externally assured by KPMG and prepared in accordance with the GRI Standards - Core option.

Your Company continued the focus on the Environmental, Social and Governance (ESG) parameters by implementing Mahindra Sustainability Framework. This framework defines sustainability as "Building enduring business by rejuvenating the environment and enabling stakeholders to rise". Various actions have been implemented across the Group based on three pillars of the framework, People, Planet and Profit. The ESG information is disclosed under Dow Jones Sustainability Index (DJSI) and Carbon Disclosure Project (CDP). In DJSI, your Company has retained its position in the Emerging Market Index. In CDP Carbon and CDP water, your Company has achieved level A.

Your Company has committed to Science Based Target, an initiative to restrict average global temperature rise in alignment of Paris Climate Change Agreement. During the year, 21 companies across the Group have committed to Science Based Target, while 16 companies have received approval for their targets. By actively working towards making the locations certified for Zero Waste to Landfill (ZWL), your Company is demonstrating its concern about the environment. During the year, 22 Group locations got certified for ZWL.

Mr. Anand G. Mahindra, Executive Chairman of your Company participated at panel of global CEO''s session at International Solar Alliance, ''First World Solar Technology Summit''. Being one of the Board Members, he attended the United Nations Global Compact Meeting.

The Sustainability performance for your Company for the Financial Year 2020-21 will be elaborated in detail in the GRI Report which is under preparation and will be ready for release shortly.

During the year under review, your Company was recognized for its leadership position on the ESG dimensions by way of:

• Recognition as a part of 2020 CDP Supplier Engagement Leader-board. The Company is among the top 7% assessed for supplier engagement on climate change, based on 2020 CDP disclosure.

• Receiving an India Corporate Governance & Sustainability Vision Award 2021, organised by The Indian Chamber of Commerce in the category of ''Sustainability Performance''.

• Recognition as part of ''100 Most Sustainably Managed Companies in the World'' by The Wall Street Journal. The Company ranked 17th which is highest for an automobile company and highest for an Indian company.

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 VIII and forms part of this Report.

Share Capital

The issued, subscribed and paid-up Share Capital of the Company stood at Rs. 621.60 crores as at 31st March, 2021 comprising of 1,24,31,92,544 Ordinary (Equity) Shares of Rs. 5 each fully paid-up. There was no change in Share Capital during the year under review.

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/FY21/AnnualReport.zip.

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

Neither the Executive Chairman nor the Managing Director of the Company received any remuneration or commission from any of the subsidiary 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. I ssue 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. No application was made or any proceeding is pending under the Insolvency and Bankruptcy Code, 2016 during the year in respect of your Company.

7. There was no one time settlement of loan obtained from the Banks or Financial Institutions.

For and on behalf of the Board

ANAND G. MAHINDRA

Executive Chairman

Mumbai, 28th May, 2021


Mar 31, 2021

DIRECTORS’ REPORT

Your Directors present Thirty Fourth Annual Report together with the audited accounts of your Company for the year ended March 31, 2021.

FINANCIAL RESULTS (STANDALONE)

('' in Million)

For the year ended March 31

2021

2020

Income

305,627

315,916

Profit Before Interest, Depreciation and Tax

62,521

60,663

Interest

(632)

(667)

Depreciation

(6,623)

(6,674)

Profit Before Tax

55,266

53,322

Provision for Taxation

(12,875)

(7,977)

Profit After Tax

42,391

45,345

Other Comprehensive Income

2,453

(3,234)

Balance brought forward from previous year

184,021

171,952

Transition impact of Ind AS 116, net of tax

-

(78)

Balance

184,021

171,874

Profit available for appropriation

226,432

217,130

Equity Dividends (Including tax on Dividends)

(19,335) 2

(27,522)1

Transfer to retained earnings on account of options lapsed

96

59

Others

-

26

Transferred to Special Economic Zone re-investment reserve (net of utilisation)

(6,319)

(5,540)

Buyback of equity shares (refer note 18(v))

-

(132)

Balance carried forward

200,874

184,021

1 Interim Dividend for the financial year ended March 31, 2020 and Final Dividend for the financial year ended March 31, 2019

2 Interim Dividend (Special Dividend) for the financial year ended March 31, 2021 and Final Dividend for the financial year ended March 31, 2020

DIVIDEND

The Board of Directors on October 23, 2020 approved a special dividend of '' 15/- per equity share (i.e. 300%) on par value of '' 5/- each which was paid by the Company to the shareholders whose names were appearing in the Register of Members as on November 2, 2020 being the record date for the payment of dividend. Your Directors are pleased to recommend a final dividend of '' 30/- per share (including a special dividend of '' 15/-per share) on par value of '' 5/- (i.e. 600%), payable to those Shareholders whose names appear in the Register of Members as on the Book Closure Date. Thus, the total dividend for the Financial Year 2020-21 will be '' 45/- per share (i.e. 900%) as against '' 15/- per share (i.e. 300%) in the Financial Year 2019-20.

Your Company has formulated a Dividend Policy which is disclosed on the website of the Company at https:// insights.techmahindra.com/investors/tml-dividend-distribution-policy.pdf

SHARE CAPITAL

During the year under review, your Company allotted 2,407,703 equity shares on the exercise of stock options under various Employee Stock Option Schemes. Consequently, the issued, subscribed and paid-up equity share capital has increased from '' 4,829 million divided into 965,852,364 equity shares of '' 5/- each to '' 4,841 million divided into 968,260,067 equity shares of '' 5/- each.

BUSINESS PERFORMANCE / FINANCIAL OVERVIEW

The Company provides connected experiences, offering innovative and customer-centric information technology experiences, enabling Enterprises, Associates and the Society to Rise™. The Company has over 121,000 professionals in over 90 countries, helping 1,007 global customers including many Fortune 500 companies. The Company’s convergent, digital, design experiences, innovation platforms

and reusable assets connect across a number of technologies to deliver tangible business value and experiences to stakeholders. Your Company also focuses on sustainable business strategy, managing social and environmental impacts, while ensuring that corporate decisions lead to an equitable growth. As a result, Tech Mahindra is one of the three companies from India to be included in the DJSI World Index 2020 and one of the eleven Indian companies in the Emerging markets category.

During the Financial Year 2020-21, the Company’s consolidated revenues increased to '' 378,551 million from '' 368,677 million in the previous year, a growth of 2.7%. The geographic split of revenue is 47.5% from the Americas, 26% from Europe and 26.5% from the Rest of the World.

The consolidated Profit (including other income) before Interest, Depreciation and Tax was at '' 75,846 million, against '' 66,955 million in the previous year.

The consolidated Profit after Tax amounted to '' 43,530 million as against '' 38,974 million in the previous year.

In an age of regular technological disruption, Tech Mahindra is delivering value to its customers with its domain expertise and wide range of offerings in blockchain, machine learning, artificial intelligence, cloud, cyber security, quantum computing and IoT combined with an intimate understanding of each customer and their objectives. The Company has collaborated with industry leaders and startups, academia and partners under TechMNxt charter to provide customized yet simplified solutions for customers.

IMPACT OF COVID-19

The COVID - 19 pandemic that began in Q4 of FY 2019-20, continues to impact people globally, causing healthcare crisis, impacting economies and businesses at large. Economic activity took a backseat as most efforts were channelized in strengthening health infrastructure and supporting weaker sections of the economy. The Company did witness impact in several of its clients, as organizations resorted to cash conservation and reduction of discretionary spending. This impacted demand in the first half of Financial Year 2020-21. Your Company undertook several initiatives to ensuring safety of its people, assets and communities at large. The Company deployed business continuity plans ensuring continues service to customers throughout these tough times. Your

Company realigned its strategy, modified the delivery model and crafted solutions focused on enabling the clients to imagine the future of their business, building and running it for them. This led to a robust demand in the second half of the year, as your Company helped adopt massive technological changes and new business models.

ACQUISITIONS

CERIUM

The Company on April 9, 2020 acquired 51% of the share capital of Cerium Systems Private Limited (Cerium). The enterprise value of Cerium is '' 2,450 million. Cerium is an integrated circuit and embedded software design service provider that is expected to help bolster Tech Mahindra’s capabilities in the areas of semiconductor design and testing, embedded software development / testing and product engineering. The remaining 49% to be acquired over the next three years at a valuation linked to the financial performance of Cerium. During the year, the Company acquired a further 6% stake thereby taking the total shareholding to 57%.

ZEN3

The Company on April 9, 2020, acquired 100% of the share capital of Zen3 for a cash consideration of USD 64 million, out of which USD 35 million was paid upfront, USD 4 million will be paid over two years and maximum upto USD 25 million will be paid over three years linked to financial performance. Zen3 is leading software solution group with strong capabilities in AI enablement services, AI speech solutions, cloud engineering, software product engineering and DevOps. Zen3 has more than 1,300 employees across offices in Seattle, Dublin, Bengaluru, Hyderabad and Vishakhapatnam.

TENZING

The Company acquired 100% of the share capital of Tenzing Ltd and Tenzing Australia Ltd (Tenzing Group) through its wholly owned subsidiary Tech Mahindra (Singapore) Pte Ltd at a consideration of USD 29.5 million including earnouts. The Company is headquartered in Auckland, New Zealand and is engaged in the business of Management Consulting, Digital Transformation and Technology services. It has 145 employees and a turnover of USD 27.4 million. The acquisition will bring strong capabilities primarily in the Insurance vertical along with expanding footprint in the Australia and New Zealand (ANZ) market. The acquisition was completed on December 1, 2020.

MOMENTON

Momenton Pty. Ltd. ("Momenton”) was acquired by the Company through its wholly owned subsidiary viz., Tech Mahindra (Singapore) Pte Limited at a consideration upto AUD 14.3 million including earnouts. The company is headquartered in Melbourne, Australia and has approximately 55 employees. Turnover for the financial year ended 30th June 2020, was AUD 10.8 million. Momenton is a cloud and engineering services provider with a Banking and Financial Services (BFS) focus. The acquisition will enhance Tech Mahindra’s digital transformation capabilities and provide Tech Mahindra a scaled-up presence in the Australian BFS market. This acquisition was completed on 12th February 2021.

PERIGORD

The Company acquired 70% of Perigord Asset Holdings Limited ("Perigord”) through its wholly owned subsidiary Mahindra Engineering Services (Europe) Ltd at a consideration of EUR 21 Million and the remaining 30% will be acquired over the next four years at a valuation linked to financial performance of the company. Perigord is headquartered in Dublin, Ireland with a presence in Germany, USA and India with 380 employees. For the financial year ending 31st December 2020, the company had revenue of EUR 19.5 million The Indian subsidiaries of Perigord were acquired by the Company directly.

Perigord specialized in end to end packaging supply chain solutions to the life sciences industry with services such as packaging artwork & labelling services, strategic consultancy, creative and digital, strategic outsourcing, managed services and software solutions. The acquisition was completed on 15th March, 2021.

PAYMENTS TECHNOLOGY SERVICES LIMITED

The Company announced the acquisition of Payments Technology Services Limited, Hongkong on 12th January 2021 at a consideration of USD 9 million. The company is headquartered in Hong Kong and has approximately 109 employees. Turnover of the Company for the financial year ended 31st December 2019 was USD 5.4 million.

The Payments Technology Services entity is a step-down subsidiary of Fidelity Information Services (FIS). The acquired capabilities in the payments space will give us access to IPs and licenses for two products, which is consistent with the strategy of

pivoting the business towards products and platform implementations as well as participating in the banking transformation programs. This acquisition will open up other opportunities for Tech Mahindra across a number of areas in partnership with FIS.

DIGITALONUS

The Company announced the acquisition of DigitalOnUs, Inc. ("DigitalOnUs”) on 19th April 2021 at an enterprise value of USD 120 million through its wholly owned subsidiary, Tech Mahindra (Americas) Inc. The company is headquartered in San Jose, California, USA. DigitalOnUs is focused on Cloud Native Development and Hybrid Cloud Automation services. The acquisition of DigitalOnUs will enhance Tech Mahindra’s capability in cloud native engineering and position it to develop cutting-edge digital solutions for its customers. DigitalOnUs has more than 380 employees. For the financial year ending 31st December 2020, the company had revenue of USD 30.6 million. The Indian subsidiary of DigitalOnUs namely DigitalOps Technology Private Limited has been acquired by the Company.

EVENTUS

The Company announced the acquisition of Eventus Solutions Group, LLC. ("Eventus”) on April 26, 2021 through its wholly owned subsidiary Tech Mahindra (Americas) Inc. at a consideration of USD 44 million. Eventus provides end-to-end customer engagement solutions, such as strategy consulting, cloud based tools and automation services and managed services. The company is headquartered in Denver, Colorado. It has a turnover of USD 33.2 million in CY2020, with an employee base of around 100 spread across various states in the US.

The acquisition of Payment Technology Services Ltd, DigitalOnUs and Eventus are yet to be consummated on the date of this report.

DETAILS OF SUBSIDIARIES / JOINT VENTURES / ASSOCIATE COMPANIES

The performance and financial position of the subsidiaries, associate companies and joint venture companies included in the consolidated financial statement is provided in accordance with the provisions of Section 129 read with Rule 5 of the Companies (Accounts) Rules, 2014 containing the salient features of the financial statement of Company’s subsidiaries/joint ventures or associate companies in Form AOC - 1 in “Annexure I” to this report.

Pursuant to Rule 8(5)(iv) of the Companies (Accounts) Rules, 2014, the names of the companies which have been incorporated or ceased to be the subsidiaries, joint ventures or associate companies during the year are provided in “Annexure II” to this report. The Company is actively pursuing the initiative on consolidation of its subsidiaries/branches to optimise the operational costs. During the year under review, your Company has closed/merged Eight subsidiaries.

In terms of the provisions of Regulation 24 of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, Tech Mahindra (Americas) Inc. is a wholly owned unlisted material subsidiary of the Company.

The policy for determining material subsidiaries formulated by the Board of Directors is disclosed on the Company’s website and is accessible on https:// insights.techmahindra.com/investors/Policy-For-Determining-Material-Subsidiaries.pdf

UPDATE ON MERGER

The Board of Directors at its meeting held on January 31, 2021 approved the Scheme of Merger of Tech Mahindra Business Services Ltd and Born Commerce Private Ltd with the Company. Accordingly, the companies filed the applications before Hon’ble National Company Law Tribunal (NCLT), Mumbai and Chennai Benches respectively. The applications are pending for admission as on the date of this Report.

HUMAN RESOURCES

Your Company has taken several initiatives in the development of human resources, the most important asset of the Company. Some of the initiatives taken in this area are -

Wellness: Putting Well-being at the Forefront

Since 2017, your Company has been leading a unique corporate wellness program called "Wellness Before Business” that has helped prioritize health as the foundation of its associates’ professional, personal, and spiritual well-being. Your Company was able to adapt faster to the challenges of the COVID-19 pandemic, with all actions aligned to this belief. It also gave birth to the mantra of #WellnessFirst and encouraged mental & virtual connect amongst teams while remaining physically apart. Your Company launched the AMIGO Program for holistic emotional and mental wellness for associates and their dependents. Your Company conducted daily health sessions for mental (psychological experts with byte sized videos), emotional (stay connected virtually while

maintaining social distance) and physical (how to stay healthy and fit) wellness. By transitioning to virtual wellness services, daily sessions with experts and incentivizing wellness benefits, your Company has encouraged its associates stay distant, yet connected.

Pandemic: Enabling Work from Home

Your Company was amongst the first to publicly express the need for staying distant and being safe with a logo tweak, the "e” in "Tech Mahindra” being boxed inside a home. Your Company formed Rapid Action Task forces at different locations for business continuity and enabling work from home. These teams helped in collaborating with government authorities, complying with health advisories, implementing best practices like travel restrictions and defining local emergency protocols. Your Company also rolled out several new policies like Remote Workstation set up, Laptop Rental, Special COVID-19 Leave Benefit, Insurance cover for Home Quarantine and Vaccination Cost Reimbursement to support working from home. Associates were also provided with infrastructure support for networking and security requirements. To make associates and managers accustomed to working from home, the WFH101 program was launched within a week of the lockdown. These activities enabled over 90% of associates to work from home productively within 72 hours of the government’s lockdown announcement.

Leadership: Peacetime Leaders to Wartime Generals

The COVID-19 pandemic changed the leadership paradigm and style of functioning. Your Peacetime Leaders became Wartime Generals. Like in war, one does not have the luxury of time to mull over decision making, the pandemic called for leaders to become agile, think fast and act faster. It meant being focused and yet open to revisiting strategies, taking bold risks, judiciously deploying resources and above all, working tirelessly till the war was won! This new model of ‘Wartime Generals’ is what your Company sought to create. These new leaders helped rally their teams, kept the team engaged and communicated clear, crisp messages frequently while challenging conventional thinking. Your Company has launched a real-time Performance Management System for its top 300 leaders to drive a high-performance culture which ensures that key business initiatives and leaders’ goals are in-sync and tracked regularly. Your Company has also setup five transformation offices and identified 36 strategic initiatives along with output metrics, targets and RACI.

Communication: Frequent, Transparent and Empathetic

With associates working from home, your Company faced natural challenges in ensuring that a distributed workforce stayed connected. Your Company communicated with urgency, transparency and empathy to help associates adjust to the constantly changing conditions crises bring and to maintain a single source of truth. Your Company created a live microsite to prioritize consistent and continuous communication. Your Company launched a daily newsletter called TechM Coronicles that included a video message from a leader, inspirational stories, clarification of rumours, training calendars, associate engagements and customer kudos. Additionally, a new connect series called PrimeTime was introduced to keep associates updated and inspired by external speakers. This was a daily one-hour virtual connect and it featured global leaders from a cross section of industries including Sports, Cinema and Politics. There were close to 150 episodes of Primetime over the course of the year.

Engagement: lovetobeTechM has no boundaries

Your Company used connected technologies to create meaningful experiences for associates working remotely and organized several collaborative activities that included their families. Through the "Each One House One” initiative associates welcomed their colleagues from their neighborhood into their homes. Your Company also facilitated the return of approximately 2000 associates and their families who were stranded abroad through repatriation flights.

Rewards: Nurturing A Culture of Giving

Your Company and its associates believe in driving positive change especially the vulnerable communities impacted during pandemic through individual and Company social responsibility. Last year associates donated ''1.5 million towards social causes - a 105% increase over the previous year. Associates also helped vulnerable communities through voluntary services like grocery/grain distribution, tree plantation and community drives, taking care of migrant workers, donating PPE kits / medical supplies etc. Your Company also facilitated the screening of around 10,000 third-party vendors, associates and members of the partner ecosystem including those working in pantry, sanitation and security departments through the Mhealthy platform. Mhealthy was launched in July 2020 with 32 screening tests, risk profile, access to medical care, antibody test for COVID-19 to secure the workplace. Through these numerous measures,

your Company has continued to recognise the extra ordinary resilience shown by associates through its digital platform that nurtures appreciation and social sharing.

Hiring: Reversing the pyramid

Your Company has taken proactive steps to introduce young talent that will thrive in the ‘new normal.’ With the launch of new programs like LEAP and ELEVATE, your Company gives fresh graduates the flexibility of remote work from home. These programs in addition to the existing ELITE Engineering graduate hiring, Management Trainee program (for hiring fresh talent from B-schools) and Global Leadership Cadre program (for fast-tracking the growth of young leaders) help your Company reverse the pyramid. Your Company has also expanded the use of the #NewAgeDelivery platform in the hiring process by checking for internal talent that are to be released from projects or those already on the bench so as to reduce external hiring costs.

Learning: Becoming Fit4Future

During the year virtual learning picked up momentum as your Company prioritized re-skilling and upskilling through the NAD Learn (formerly Upskilling as a Service) platform. This self-learning ecosystem has offered more than 55,000 associates the opportunity to become full-stack/ full cycle professionals. 20,000 associates are engaged in the RIDE Future Skilling program that is helping your Company transition to new age technologies. Your Company launched EMBARK to train 500 Program Managers on ten special competencies. The top 300 Leaders who completed the Chrysalis program last year had a special 3-month development journey to help them lead during this unprecedented time. Your Company has also helped 400 customers across 31 countries prepare for a post COVID-19 world by sharing best practices and learning content.

Diversity: Creating a sense of Belonging

Your Company reinforced its commitment to being intentionally diverse by becoming a signatory of UN Women and a part of the WEP (Women’s Empowerment Principles) Community. The Women Leaders Program has helped your Company identify more than 50 trailblazers who can drive future business in the ‘new normal.’ Focussed efforts were made towards generational diversity as young leaders were developed through programs like AIM, Ascend and Transcend.

QUALITY

The Company continues its focus on quality and strives to exceed customer expectations at all times. During the year, it continued to strengthen the implementation of CMMI Dev v1.3 (Capability Maturity Model Integration) Dev v1.3 (Capability Maturity Model Integration) (Development) for which the organization is assessed at L5. Similarly it underwent various upgrade and continuous evaluation audits for multiple standards during the year in order to meet client demands and enhance value delivery - Successfully assessed for, CMMI Dev v 1.3, Level 5, ISO 9001:2015 (Quality Management System), ISO 20000-1:2018 (Information Technology Service Management System), ISO 27001:2013 (Information Security Management System), TL9000 R 6.2/ R5.6 (Quality Management Systems for Tele Communications industry), ISO 13485:2016 (Quality Management Systems for medical devices - scope of certification limited to medical devices business within Tech Mahindra), AS9100 Rev D (Standard for Aerospace domain - scope of certification limited to the aerospace business within Tech Mahindra).

In addition to these, your Company also maintains its commitment to health, safety and environment by continually improving its processes in accordance with ISO 14001:2015 (Environmental Management System) and ISO 45001: 2018 (Occupational Health and Safety Assessment Series) standards. Your Company is also certified on ISO 22301:2012 (Societal Security and Business Continuity Management System) and has a comprehensive Business Continuity and Disaster Recovery framework, to prevent potential business disruptions in the event of any disaster. It has processes that helped resume services to customer’s acceptable service levels. Automated Service Desk with SLAs for enabling business and Vulnerability Assessment and Penetration Testing Lab for secured corporate network operations are highlights that showcase the information security posture of the Organization.

During the pandemic year, the entire quality management system was put to test, associates were working from home while complying with all security requirements and able to deliver the services to the desired quality as per customer contractual commitments.

Tech Mahindra (IT Division) has been assessed for the implementation of high maturity business excellence practices at Mahindra Group (Services Sector). It has

been assessed at TMW Maturity Stage 6 (on scale of 1-10 stages) of Mahindra Business Excellence Framework - The Mahindra Way. These certifications are testimony of the robustness of business processes and at large the quality culture imbibed in the organization.

Your Company has continued to strengthen the process for transforming Quality Assurance processes & delivery methods to New Age Delivery processes through the #NewAgeDelivery Engine. This engine focuses on asset creation and re-usability, enabling associates to be rightly skilled through Upskilling as a service, enabling projects and programs to deploy smart planning and crowd sourcing through Capability as a service, providing an automated workflow environment for the associates to execute the project seamlessly through Digital inside and Continuous Delivery. All of this has lead to better customer experience and faster quality delivery. This engine is further strengthened with command center view for the programs and units to access their realtime performance against the targets. Moreover the system is enabled with automated signals and alerts when the performance breaches the threshold for the owner to take corrective actions. The Company is putting all these initiatives in place to ensure that it deliver as stated in its Quality Policy.

DIRECTORS

During the year under review, all Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Independent Directors have also given declaration of compliance with Rules 6(1) and 6(2) of the Companies (Appointment and Qualification of Directors) Rules, 2014, with respect to their name appearing in the data bank of Independent Directors maintained by the Indian Institute of Corporate Affairs.

Pursuant to the provisions of Section 152(6)(c) of the Companies Act, 2013, Dr. Anish Shah is liable to retire by rotation and offers himself for reappointment.

Dr. Anish Shah (DIN: 02719429) who was appointed as an Additional Director with effect from September 10, 2019 has been appointed as Director of the Company at the Annual General Meeting held on July 28, 2020.

Your Directors co-opted Mr. Manoj Bhat (DIN: 05205447) as an Additional Director with effect from 2nd April 2021 whose term will end at the ensuing Annual General Meeting and being eligible offers himself for appointment.

Mr. V.S. Parthasarathy, (DIN: 00125299) resigned as director of the Company with effect from 31st January 2021. Your board places on record its sincere appreciation for the valuable services rendered by Mr. Parthasarathy to the Company during his tenure.

In terms of Regulation 24(1) of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, Mr. T. N. Manoharan, Independent Director of the Company has been appointed as Director in Tech Mahindra (Americas) Inc., a Wholly owned unlisted material subsidiary of the Company with effect from May 21, 2019.

Mr. T. N. Manoharan was also appointed as Lead Independent Director by the Board of Directors at its Meeting held on April 26, 2021.

In the opinion of the Board of Directors the Independent Directors have relevant proficiency, expertise and experience.

FAMILIARISATION PROGRAMME

These programmes aim to provide insights into the Company to enable the Independent Directors to understand its business in depth and contribute significantly to the Company. The details of program for familiarisation of the Independent Directors with the Company are available on the Company’s website and can be accessed at; https://insights. techmahindra.com/investors/tml-familarisation-progarmmes-for-IDs.pdf

The Board members are also regularly updated on changes in the statutory provisions like changes in Corporate Laws, SEBI Regulations, Taxation Laws and People related laws as applicable at the quarterly Board meetings. The Board members are also updated on the Risk universe applicable to the Company’s business. The MD & CEO of the Company had a quarterly session with Board members sharing updates about the Company’s business strategy, operations and the key trends in the IT industry that are relevant for the Company. These updates help the board members in keeping abreast of the key changes and their impact on the Company.

BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and Regulation 19 read with Schedule II, Part D of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has devised a policy on evaluating the performance of the Board of Directors, the Chairman, Committees, and Individual Directors. The evaluation process was carried out through a web-based portal. The summary of the evaluation reports was presented to the respective Committees and the Board. The Directors had a positive feedback on the overall functioning of the Committees and the Board. The suggestions made by the Directors in the evaluation process have been suitably incorporated in the processes.

NUMBER OF MEETINGS OF THE BOARD

The Board met seven times during the financial year 2020-21. The meeting details are provided in Corporate Governance report that forms part of this Annual Report. The maximum interval between any two meetings did not exceed 120 days as prescribed in the Companies Act, 2013 and SEBI Listing Regulations.

POLICY ON DIRECTORS’ APPOINTMENT AND REMUNERATION

The Governance policies laid down by the Board of Directors of your Company include:

i. Policy on appointment and removal of Directors, Key Managerial Personnel and Senior Management.

ii. Policy on remuneration to the Directors, Key Managerial Personnel and Senior Management and other Employees.

The extract of these two policies are provided in “Annexure III”.

The policies are available on the Company’s website on https://insights.techmahindra.com/investors/ Governance-Policies-including-remuneration-to-Directors-KMPS.pdf

SUCCESSION PLAN

In accordance with the principles of transparency and consistency, your Company has adopted governance policies for its Board of Directors, Key Managerial Personnel & senior management appointments, remuneration and evaluation. In line with these Governance policies, the Company has

established a formal Succession Planning Program for key managerial persons across the organization. The Board evaluates all such plans at a regular intervals and institutes a formal program for filling any such critical position. The Board evaluates both internal and external candidates for such positions alongwith the recommendations of the Company. The Company also has a leadership development program where it identifies high potential managers, and trains them to take up the positions of higher responsibilities. The Company has identified the second line of leadership, which provides stability to the business in any contingencies.

TRAINING

The Company has laid down a policy on training for Independent Directors, as part of the governance policies. The Senior Leadership of the Company update the Directors on the regulatory changes, Business strategy and operations periodically.

KEY MANAGERIAL PERSONNEL (KMP)

Pursuant to provisions of Section 203 of the Companies Act, 2013, Mr. C. P Gurnani, Managing Director & Chief Executive Officer, Mr. Manoj Bhat, Chief Financial Officer and Mr. Anil Khatri, Company Secretary & Compliance Officer were the Key Managerial Personnel of the Company during the year under review. Mr. Milind Kulkarni was appointed as Chief Financial Officer of the Company w.e.f. 2nd April 2021.

DIRECTORS’ RESPONSIBILITY STATEMENT

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

i. in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

ii. they have, in the selection of the accounting policies, consulted the Statutory Auditors and these have been applied consistently and, reasonable and prudent judgments and estimates have been made so as to give a true and fair view of the state of affairs of the Company as at March 31, 2021 and of the profit of the Company for the year ended on that date;

iii. proper and sufficient care had been taken 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 other irregularities;

iv. the annual accounts have been prepared on a going concern basis;

v. they had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively;

vi. the proper systems to ensure compliance with the provisions of all applicable laws are in place and are adequate and operating effectively.

DETAILS WITH RESPECT TO ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS

The Company has internal financial controls which are adequate and were operating effectively. The controls are adequate for ensuring the orderly and efficient conduct of the business, including adherence to the Company’s policies, the safe guarding of assets, the prevention & detection of frauds & errors, the accuracy and completeness of accounting records and timely preparation of reliable financial information.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS / PROCEEDINGS

There are no significant and material orders passed by the regulators or courts or tribunal impacting the going concern status and the Company’s operations in the future.

Further no application against the Company has been filed or is pending under the Insolvency and Bankruptcy Code, 2016, nor the Company has done any one time settlement with any Bank or Financial institutions.

STATUTORY AUDITORS

The members, in the 30th Annual General Meeting held on August 1, 2017, appointed B S R & Co. LLP, Chartered Accountants, [Firm’s Registration No. 101248W/W- 100022] as the Statutory Auditors of the Company, to hold office for a term of five years from the conclusion of the 30th Annual General Meeting (AGM) of the Company held in the financial year 201718 until the conclusion of the AGM of the Company for the financial year 2021- 22 on such remuneration as may be determined by the Board of Directors.

The members may note that the Ministry of Corporate Affairs vide notification dated May 07, 2018, has done away with the requirement of yearly ratification of appointment of Statutory Auditors, at the AGM.

Pursuant to Section 139 of the Companies Act, 2013 the statutory auditors B S R & Co. LLP, Chartered Accountants have confirmed that they are eligible to continue as auditors.

There are no qualifications, reservations, adverse remark or disclaimer made in the audit report for the Financial Year 2020-21.

SECRETARIAL AUDIT REPORT

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 had appointed Dr. K. R. Chandratre, Practicing Company Secretary, Pune to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is available at “Annexure IV” to this report. There are no qualifications, reservations, adverse remark or disclaimer made in the Secretarial Audit Report.

COMPLIANCE WITH SECRETARIAL STANDARDS

The Company has complied with the applicable Secretarial Standards.

ANNUAL RETURN

Pursuant to the provisions of Section 92(3) read with Section 134(3) (a) of the Companies Act, 2013, the Annual Return in Form MGT-7 is available at the web link: https://insights.techmahindra.com/investors/mgt7-annual-return-202021.pdf

MANAGERIAL REMUNERATION

Disclosures of the ratio of the remuneration of each director to the median employee’s remuneration and other details as required pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended from time to time, are provided as “Annexure V”.

None of the directors or Managing Director & CEO of the Company, received any remuneration or commission from Subsidiary Companies of your Company.

The details of remuneration paid to the Directors including the Managing Director & CEO of the Company are given in Corporate Governance Report.

PARTICULARS OF EMPLOYEES

The information required under Section 197(12) of the Companies Act, 2013 ("the Act”) read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms part of this Report. However, pursuant to first proviso to Section 136(1) of the Act, this Report is being sent to the Shareholders excluding the aforesaid information. Any shareholder interested in obtaining said information, may write to the Company Secretary at the Registered Office / Corporate Office of the Company and the said information is open for inspection at the Registered Office of the Company.

POLICY ON PREVENTION OF SEXUAL HARASSMENT

Your Company laid down Prevention of Sexual Harassment (POSH) policy which is available on its website. The Company has zero tolerance on Sexual Harassment at workplace. During the year under review there were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

The status of complaints received under POSH and redressed by the POSH Committee of the Company, during the financial year under review, are given below:

a) Number of complaints received - 30

b) Number of complaints redressed - 28

c) Number of complaints pending - 2

The Company carried out focused campaign on POSH and Awareness drives with the help of its BPS teams. Further the employees are required to undertake mandatory certification on POSH to strengthen the POSH awareness and sensitivity.

EMPLOYEE STOCK OPTION SCHEMES

During the year under review, there were no material changes in the Employee Stock Option Schemes (ESOPs) of the Company and the Schemes are in compliance with the SEBI Regulations on ESOPs. As per Regulation 14 of SEBI (Share Based Employee Benefits) Regulations, 2014 read with SEBI circular dated June 16, 2015 the details of the ESOPs are uploaded on the Company’s website; https:// insights.techmahindra.com/investors/Details-of-ESOPs-FY-2020-21.pdf

CORPORATE GOVERNANCE

A report on Corporate Governance covering among others composition, details of meetings of the Board and Committees along with a certificate for compliance with the conditions of Corporate Governance in accordance with the Securities and Exchange Board of India (Listing Obligations And Disclosure Requirements) Regulations, 2015, issued by the Statutory Auditors of the Company, forms part of this Annual Report.

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.

COST RECORDS

Maintenance of cost records and requirement of cost audit as prescribed under the provisions of Section 148 (1) of the Companies Act, 2013 are not applicable for the business activities of the Company.

RISK MANAGEMENT

The Risk Management Committee of the Board of Directors guides the operating management to identify risks, analyze their probability and impact and prepare mitigation plans. It periodically reviews the Risk Management Framework & Enterprise Risk Register which is presented by the Chief Risk Officer. The Company identifies all potential risks, economical, business, currency, operational, climate, governance, financial etc and prepares a mitigation plan for each of the risks. The elements of risk as identified by the Company with the impact and mitigation strategy are set out in the Management Discussion and Analysis Report (MDA).

ESTABLISHMENT OF VIGIL MECHANISM

The Company has laid down Whistle Blower Policy covering Vigil Mechanism with protective Clauses for the Whistle Blowers. The Whistle Blower Policy is made available on the website of the Company.

DEPOSITS / LOANS & ADVANCES, GUARANTEES OR INVESTMENTS

The Company has not accepted any deposits from the public during the year under review. The particulars of loans/advances, guarantees and investments under Section 186 of the Companies Act, 2013 are given in the notes forming part of the Financial Statements.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All transactions entered into with Related Parties as defined under Section 2(76) of the Companies Act, 2013 and Regulation 23 of the Securities and Exchange Board of India (Listing Obligations And Disclosure Requirements) Regulations, 2015, ("The Listing Regulations”), during the financial year under review were in the ordinary course of business and at an arm’s length pricing basis and do not attract the provisions of Section 188 of the Companies Act, 2013. There were no transactions with related parties in the financial year which were in conflict with the interest of the Company and requiring compliance of the provisions of Regulation 23 of the Listing Regulations. Suitable disclosure as required by the Indian Accounting Standards (Ind AS 24) has been made in the notes forming part of the Financial Statements.

The Company has formulated a policy on the materiality of Related Party Transactions and dealing with Related Party Transactions which has been uploaded on the Company’s website and can be accessed at following link https://insights.techmahindra.com/investors/Related-Party-Transactions-Policy.pdf

The particulars of related party transactions in prescribed Form AOC - 2 are attached as “Annexure VI”.

Pursuant to Regulation 23(9) of the Listing Regulations your Company has filed half yearly report on Related Party Transactions with the stock exchanges.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars as prescribed under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 are provided in “Annexure VII” which forms part of this report.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

The CSR vision of the Company is "Empowerment through Education.”

In compliance with the guidelines prescribed under Section 135 of the Companies Act, 2013, your Company has constituted a Corporate Social Responsibility (CSR) Committee of the Board. The CSR policy, covering the Objectives, Focus Areas, Governance Structure Monitoring and Reporting

Framework among others is approved by the Board of Directors. In accordance with the amendments made in Section 135 in January 2021, the CSR Policy has been duly revised and is available at https://files. techmahindra.com/static/img/pdf/csr-policy-techm-v3-march2021.pdf

The Company has spent more than 2% of the average net profits of the Company during the three immediately preceding financial years on CSR. During the year under review, the Company contributed a significant amount towards COVID-19 relief efforts.

The Company’s social initiatives are mainly carried out by Tech Mahindra Foundation and Mahindra Educational Institutions, Section 8 (erstwhile Section 25) Companies promoted by the Company.

TECH MAHINDRA FOUNDATION (TMF)

The Foundation was set up in 2006, as a Section 25 Company (referred to as a Section 8 Company in the Companies Act, 2013). Since then, it has worked tirelessly towards the overarching vision of "Empowerment through Education”, establishing itself as a prominent CSR player within the Mahindra Group as well as a leading social organization at the national level. The Foundation essentially works with children, youth and teachers from disadvantaged urban communities in India, with a special focus on women and persons with disabilities. During the year under review, Tech Mahindra Foundation has successfully implemented 150 high-impact projects with more than 90 partners, directly benefitting 31,767 individuals. In addition, the Foundation reached out to over 1.5 Million people across the country through its COVID Relief efforts.

EDUCATION

The key initiatives in the area of School Education include:

ALL ROUND IMPROVEMENT IN SCHOOL EDUCATION (ARISE)

Tech Mahindra Foundation’s educational initiatives under ARISE are long-term school improvement programmes, in partnership with local governments and partner organisations. The Foundation in 202021 worked with 30 government schools to turn them around into model schools of excellence. Around 6,400 students were covered under this programme.

During the year, the Foundation expanded its work for children with disabilities through its ARISE

programme. This programme is a variant of ARISE in which children with disabilities are provided chronic therapy as well as special education to help them lead more fulfilling lives. Through 25 projects, the programme enabled 2,776 differently-abled students to become better learners and more independent in managing themselves. As the interventions shifted to online mode, 430 students were provided digital tablets to ensure continuity of learning.

SHIKSHAANTAR

Shikshaantar, envisioned as a programme for enhancing capacity of government school teachers, has emerged as an important programme in the education portfolio of the Foundation. TMF works with the Municipal Corporations in East Delhi and North Delhi by running their In-Service Teacher Education Institutes, and during the year under review, as many as 6,378 teachers were trained as part of this initiative. This included specially designed modules for Digital Literacy, Cyber Security and Mental Health that were delivered to the teachers through online sessions.

MOBILE SCIENCE LAB

In order to increase the footprint of its work in education and reach the unreached, TMF launched a unique initiative in 2019-20 - the Mobile Science Lab. For this, a Mahindra bus was remodeled into a science lab on wheels that travelled across schools in East Delhi to provide STEM learning for children in grades 3 and 4. Though the program could not be implemented because of COVID, a second Mobile Science Lab was commissioned through funding received from the National Scheduled Caste Finance & Development Corporation.

EMPLOYABILITY

Skills-for-Market Training (SMART) is the Foundation’s flagship programme in employability. It is built on the vision of an educated, enabled and empowered India, and the belief that educated and skilled youth are the country’s true strength. The programme started with three Centres in 2012 and is currently running over 100 Centres at 11 locations across India. These include SMART Centres, SMART Centres (training for people with disabilities), and SMART-T Centres (training in technical trades).

I n financial year 2020-21, your Company trained 14,394 young women and men under its SMART program, of which, 1,687 were persons with disabilities. Upon successful completion of the course, more than 70% of the graduates are placed in jobs across multiple

industries. A significant achievement for the year was that the average salaries earned by the students increased by over '' 500 per month, despite the severe impact of the pandemic.

The Foundation’s commitment to setting new benchmarks in skill development in India has been underscored by the setting up of Tech Mahindra SMART Academies, which provide the highest quality of skill training to youngsters in Healthcare and Digital Technologies. During FY 2020-21, 1,317 students were enrolled to the four Healthcare Academies in Delhi, Mohali, Mumbai, and Pune, the last of which started functioning in March 2021. In addition, another 710 students were enrolled at the SMART Academies for Digital Technologies in Vizag, Hyderabad and Mohali.

TMF’s work in COVID Relief

As soon as the pandemic broke out in the beginning of the Financial Year, the TMF team shifted its emphasis towards carrying out relief activities for those who were the hardest hit - daily wagers, migrant workers, farmers, persons with disabilities and the transgender community. Through a structured and efficient intervention, the Foundation distributed nearly 6 lakhs ration kits, 3.20 lakhs cooked meals, PPE kits, masks, and medical equipment to hospitals. In all, relief efforts worth '' 14.82 crores were carried out over the year that continued into the current financial year as well. Till date, over 20 lakhs people have benefitted through these efforts.

MAHINDRA EDUCATIONAL INSTITUTIONS (MEI)

MEI - a not-for-profit, 100% subsidiary of the Company has set up Mahindra Ecole Centrale in August 2014 - through a collaborative venture between Mahindra Educational Institutions and Ecole Centrale of Paris, France (now known as Centrale Supelec) and the JNTU Hyderabad - to offer undergraduate engineering programs. Through this strong Indo-French Collaboration with Centrale Supelec and Industry connect with Tech Mahindra, MEC has emerged as a disruptive player in the field of Technical Education.

MEI has sponsored the setting up of Mahindra University to introduce diverse streams of education in addition to Engineering.

MAHINDRA UNIVERSITY

Mahindra University (MU) was notified by the Government of Telangana vide Telangana Ordinance No. 1 of 2020 dated 20th May 2020 as per the

Telangana State Private Universities (Establishment and Regulation) Act, 2018 for "educating future citizens for and of a better world”.

Mr. Anand Mahindra, Chairman of the Company and the Mahindra Group is the Founding Chancellor of the University and he believes that Professional Courses have the greatest potential to contribute to economic inclusivity and sustainable development.

The University will drive a meaningful shift in the way we deliver higher education, besides focusing on infusing emerging technologies into the education space, it will drive interdisciplinary academic excellence, integrating science technology, humanities, ethics, philosophy and design, with purpose. It will also stress on developing multiskilled leaders, who are ethical and empathetic, and capable of reflection as well as innovation.

The University is India’s first to leverage AI & EI (artificial & emotional intelligence) for both education as well as collaboration, across the board.

Besides the existing programs in Civil Engineering, Computer Science Engineering, Electrical & Electronics Engineering, and Mechanical Engineering, the Ecole Centrale School of Engineering is offering 4-year UG programs of study in Electronics & Computer Engineering, Artificial Intelligence, and Computation and Mathematics from academic session 2020-21.

In the 2020 academic session, 657 students were admitted to the University in UG engineering programs, including 42 students in the PhD program in Engineering. Due to constraints imposed by the pandemic, classes had to be held online for most of the academic session.

The University started its accreditation process with submission of requisite documentation to the National Board of Accreditation for the four UG programs in CSE, EEE, Civil and Mechanical Engineering.

The Annual Report on CSR activities is provided as “Annexure VIII”.

SUSTAINABILITY

The pandemic has reinforced the fact that a focused sustainable strategy is needed for business continuity and profitable growth. All businesses have a critical role to play as a source of finance, driving innovation, and ensuring economic growth and employment.

materials. Spread awareness and initiate campaigns on preventing single-use plastic

• Reduce, Reuse, Recycle, Recover: Implement process of Reduce, Reuse, Recycle and Recover across the value chain to limit waste and enable a circular economy

• Sustainable supply chain: Ensure our suppliers follow the highest standard of sustainable and ethical best practices; optimise logistics and transportation to reduce emissions

• Work-life balance: Provide an assured career development path and a feasible and flexi work-life balance to our associates along with a range of associate-friendly policies and processes

• Innovation: Becoming future ready by proactively encouraging Innovative thinking across the organization, adopting technology disruption to reduce emissions and going digital. Developed sustainable solutions with technologies like loT, Automation, Blockchain and AI in sustainability that will help enable a pathway to reduce emissions and other impacts of climate change.

• Green solutions: Investing in Smart grid, Microgrid-As-A-Services, Community Action Platform for Energy, Integrated Electric Vehicle Charging systems, Smart data hubs and Smart Cities for our Customers to reduce their emissions

• Individual Social Responsibility: encourage associates in making sustainability a part of their daily lives even while working from Home

• Transparency: Showcase our organizational policies, processes, risk management along with financial, environmental and social data in the Integrated Reports available online

The commitment and performances are validated by

the external recognition the Company received:

> The only Indian company to be listed in Carbon Clean 200 by Corporate Knights and As You Sow

> The only Indian IT company to score double ‘A’ in CDP Climate and CDP Water

> Included in the Climate Disclosure Project (CDP) Supplier Engagement Leaderboard 2020

The environment, social and governance (ESG) principles built-in the Tech Mahindra long-term growth strategy have helped to mitigate risks and drive profitable growth even in this crisis situation. Adopting resilient strategies and sustainable transformation with a focus on low carbon future have helped the Company to quickly adapt to disruptions and leverage the processes towards Business continuity. The Company’s commitment to environment sustainability, climate change and water security spans the entire business. As a Company with a purpose, it has delivered on its promise to run better, change faster and grow greater while also creating meaningful human experiences for all. The Cpmpany is pursuing plans that will have long-term impacts on the planet and communities, leading to a balance between sustainability and overall business profitability.

With a structured stakeholder engagement process, Tech Mahindra has been able to design strategies and initiatives, which not only improves our sustainability credentials but also reinforces its overall business philosophy. The Company is breaking through new frontiers, turning to renewable energy to achieve ecological balance while ensuring that when it comes to investments, the Company is pioneering new solutions for sustainable development. Your Company emphasis on green eco-system is seen through its commitment to going carbon neutral, making optimum use of resources and moving towards a low emission technology. The profitability of the Comopany is aligned with its principles, allowing to set sustainability milestones on its journey toward a secure future.

Your Company is aligned to the SDGs (Sustainable Development Goals) and its sustainability focus areas are as below:

• Going Carbon Neutral: Increase use of renewable energy through onsite installation and open access; improve energy efficiency through installation of LEDs, sensors; boost green investments by implementing Carbon Price; optimize business travel by enabling virtual meetings; encourage use of public transport and carpool to reduce commute emissions; plant trees to offset carbon footprints; move towards a low carbon economy ensuring environmental protection

• Saying No to plastic: Maintain plastic-free campuses and encourage associates and stakeholders to use eco-friendly & biodegradable

> One amongst only 3 companies from India to be in DJSI World Index 2020

> One of only 11 Indian Companies in DJSI Emerging Markets 2020

> Only Indian company recognized amongst the ‘2021 Global 100 Most Sustainable Corporations’ by Corporate Knights

> Scored A and included in the top 5 of India’s most Sustainable companies by Business World in collaboration with Sustain Labs Paris

> Awarded Gold rating with 94 percentile in 2020 by ECOVADIS

> Constituent of FTSE4Good Index 2020 by Financial Times Stock Exchange-Russell Group

> Winner of Mahindra Group Sustainability Performance Award 2020

> Leaders with 99 percentiles in SUSTAINALYTICS

The Integrated Annual Report is based on various global standards and frameworks like TCFD (Taskforce on Climate Related Financial Disclosures), CDSB (Climate Disclosure Standards Board), SASB (Sustainability Accounting Standard Board) and GRI standards and assured by third party according to ISAE International Standard on Assurance Engagement) 3000 standard.

Tech Mahindra discloses climate-related risks and opportunities in line with the recommendations of TCFD which focusses on the financial impact of climate-related changes on our operations.

The TechM Board is accountable for all risks and opportunities. The MD and CEO of the Company chairs the CSR Committee of the Board and has the ultimate responsibility for Sustainability. He is ably supported by the Chief Sustainability Officer who directly reports to him and Senior Management members of the Sustainability Council who manage all aspects of climate change including climate-related risks and opportunities.

The pandemic has made it imperative to make this a time of change and a time of learning. Your Company embed sustainability into COVID-19 economic recovery, implement their promises and stretch

its commitments to provide for a better and more sustainable future. Tech Mahindra is committed to the SDGs and is transitioning to a low-carbon economy to achieve the goals of Paris agreement. The strategy includes futureproofing its growth against impending changes in policies and regulations and increasing its compliance readiness. The Company is agile and adaptive to dynamic changes in internal and external environment with strategies in place to manage all business and climate change risks in an effective way. The Company has a robust business continuity management framework and incident response team that ensure it is resilient to any climate change risks.

The targets and the metrics used for managing climate related risks and the progress against these targets are disclosed in the externally assured Integrated reports available here- https://www.techmahindra. com/en-in/sustainability/

AWARDS AND RECOGNITION

Your Company continued its quest for excellence in its chosen area of business to emerge as a true global brand. Several awards and rankings continue to endorse your Company as a thought leader in the industry. Few of the Awards / recognitions received by the Company during the year 2020-21 include:

• Tech Mahindra ranked 10th - winner of ATD Best Award in the ‘Other - IT’ category

• Tech Mahindra won Gold Stevie and Bronze Stevie at "2020 Stevie Awards for Great Employers”

• Tech Mahindra’s Mhealthy won ETHealth Award for Best Technology Solution for COVID-19

• Tech Mahindra amongst 50 best workplaces for women by the Great Place to Work Institute.

• Tech Mahindra recognized amongst ‘India’s Top 20 Companies for Sustainability and CSR 2020’ by The Economic Times and Futurescape 7th Responsible Business Rankings during ETSDG Impact Summit 2020.

• Tech Mahindra recognized as a leader in 2020 Gartner Magic Quadrant for IT Services for communications service providers, worldwide.

• Tech Mahindra has featured amongst the Top 10 "Best Companies for Women in India (BCWI)” by Avtar and Working Mother for the third year in a

row and declared ‘Champions of Inclusion’ in the most inclusive companies of India Index.

• Mr. C. P. Gurnani recognized as ‘The Technology Icon of India’ by VARINDIA Brand book on ICT industry.

• Tech Mahindra featured in Fortune India 500 most valuable firms.

• TMF is a winner for the category ‘Best Corporate Foundation COVID-19 Relief Project [Large Impact]’ at the 9th India CSR Awards 2021.

• Tech Mahindra’s Surveillance Solution for Kanpur Smart City is amongst the winners at FICCI India Smart Urban Innovation Awards 2021.

• Tech Mahindra amongst Forbes Top 50 Organizations in Blockchain for 2021.

• Tech Mahindra recognized as a Leader in Gartner 2021 Magic Quadrant for Customer Service BPO.

ACKNOWLEDGEMENTS

Your Directors place on record their appreciation for the contributions made by employees towards the success of your Company more particularly ensuring business as usual in spite of COVID-19 impact. Your Directors gratefully acknowledge the co-operation and support received from the shareholders, customers, vendors, bankers, regulatory and Governmental authorities in India and abroad.

For and on behalf of the Board

Anand G. Mahindra Place: Mumbai Chairman

Date: April 26, 2021 (DIN: 00004695)


Mar 31, 2019

Dear Shareholders

The Directors present their Report together with the audited financial statements of your Company for the year ended 31st March, 2019.

A. FINANCIAL AND OPERATIONAL HIGHLIGHTS

(Rs. in crores)

Particulars

2019

2018

Revenue from Operations

53,614

49,445

Other Income

1,689

1,036

Profit before Depreciation, Finance Costs, Exceptional items and Taxation

8,328

7,259

Less: Depreciation and Amortisation Expenses...

1,860

1,479

Profit before Finance Costs, Exceptional items and Taxation

6,468

5,780

Less: Finance Costs

113

112

Profit before Exceptional items and Taxation

6,355

5,668

Add: Exceptional items

(30)

434

Profit before Taxation

6,325

6,102

Less: Tax Expense

1,529

1,746

Profit for the year

4,796

4,356

Balance of profit for earlier years

25,206

21,781

Less: Transfer to Debenture Redemption Reserve

14

14

Profits available for appropriation

29,988

26,123

Add: Other Comprehensive Income/(Loss)*

(9)

8

Less: Dividend paid on Equity Shares

932

807

Less: Income-tax on Dividend paid

80

118

Balance carried forward

28,967

25,206

* Remeasurement of (loss)/gain (net) on defined benefit plans, recognised as part of retained earnings.

Growth in global economic expansion and trade decelerated in the year gone by. Increased trade tensions and tariff hikes between the United States and China and the subsequent impact on other trading partners, took a toll on sentiment. Moreover, economic turmoil in Argentina and Turkey and the associated tightening in financial conditions across Emerging Markets, continued deceleration in China’s growth and geopolitical tensions led to a softening in global activity.

Domestic economic activity also slowed down through the year and weakened notably in the second half of Financial Year 2019. Monetary tightening during the first half of the Financial Year, sharp movements in the Rupee, tighter financial conditions, a deceleration in NBFC lending and a surge in borrowing costs affected NBFC lending post the IL&FS default and impacted growth.

However, even amidst this scenario, your Company recorded an increase of 8.4% in revenue from operations at Rs. 53,614 crores in the year under review as against Rs. 49,445 crores in the previous year.

The Profit for the year before Depreciation, Finance Costs, Exceptional items and Taxation recorded an increase of 14.7% at Rs. 8,328 crores as against Rs. 7,259 crores in the previous year. Profit after tax increased by 10.1% at Rs. 4,796 crores as against Rs. 4,356 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.

No material changes and commitments have occurred after the closure of the Financial Year 2018-19 till the date of this Report, which would affect the financial position of your Company. There has been no change in the nature of business of your Company.

Performance Review

Automotive Sector:

Your Company’s Automotive Sector, posted record total sales of 6,07,548 vehicles (5,37,639 four-wheelers and 69,909 three-wheelers) as against a total of 5,48,508 vehicles (4,90,870 four-wheelers and 57,638 three-wheelers) in the previous year, registering a growth of 10.8%.

In the domestic market, your Company sold a total of 5,69,092 vehicles as compared to 5,20,286 vehicles in the previous year resulting in a growth of 9.4%.

In the Passenger Vehicle (PV) segment, your Company sold 2,54,351 vehicles [including 2,35,362 Utility Vehicles (UVs), 17,451 Vans and 1,538 Cars] registering a growth of 2.2%, as compared to the previous year’s volume of 2,48,859 vehicles [including 2,33,915 UVs, 14,219 Vans and 725 Cars].

In the Commercial Vehicle (CV) segment, your Company sold 2,48,601 vehicles [including 53,149 vehicles <2T GVW, 1,76,203 vehicles between 2-3.5T GVW, 8,235 LCVs in the LCV > 3.5T segment, 176 vehicles in the 7.5-16.2T GVW segment and 10,838 Heavy Commercial Vehicles (HCVs)] registering a growth of 14.7% over the previous year’s volume of 2,16,802 commercial vehicles, [including 41,305 vehicles < 2T GVW, 1,58,269 vehicles between 2-3.5T GVW, 7,744 LCVs in the LCV > 3.5T segment and 9,484 HCVs].

In the three-wheeler segment, your Company sold 66,140 three wheelers, registering a growth of 21.1% over the previous year’s volume of 54,625 three wheelers.

For the year under review, the Indian automotive industry (except 2W) grew 6.4%, with the PV industry growth of 2.7% and CV industry growth of 17.6%. The UV segment of the PV industry had a very nominal growth of 2.1% as against a growth of 21% in Financial Year 2018. The LCV<3.5T segment grew 22.4% while the HCV goods segment grew 10.2%.

Your Company’s UV volume stood at 2,35,362 units, a growth of 0.6%. The UV market share for your Company stood at 25%. Your Company strengthened its UV portfolio with the launch of Marazzo in September, 2018, Premium SUV Alturas G4 in November, 2018 and the Stylish and Thrilling XUV300 in February, 2019. All three launches were well received by the market and media. As a result of the new launches, the UV market share for the Fourth Quarter of the Financial year 2019 stood at 27.9%. Scorpio, XUV500 and Bolero continued to be strong brands for your Company in the UV segment.

Your Company is the pioneer for Electric Vehicles (EVs) in India, and for the year under review, sold [along with its subsidiary Mahindra Electric Mobility Limited (MEML)] 10,276 EVs (1,811 four wheelers and 8,465 three wheelers) as against 4,026 EVs in the previous year. This growth is supported by the Governments’ thrust on adopting EVs, and sustained effort by your Company in working with various stakeholders, especially fleet operators.

In the LCV<3.5T segment, your Company retained its No.1 position with a 44.5% market share. Your Company sold a total of 2,29,352 vehicles in this segment, which is a growth of 14.9% over the previous year. The LCV<3.5T segment has two sub segments viz. LCV<2T and LCV 2-3.5T, which is the Pik-UP segment. Your Company has a market share of 22.6% and 62.9% in the two sub segments respectively.

In the HCV segment, your Company sold 10,838 trucks as against 9,484 in the previous year. This is a growth of 14.3%. The Blazo series of trucks which are backed by guarantees on mileage and service are instrumental in building the brand and growing sales. Your Company’s market share in the HCV segment stands at 4.6%.

During the year under review, your Company posted an export volume of 38,456 vehicles as against the previous year’s exports of 28,222 vehicles. This is a growth of 36.3%. This is the highest ever exports by your Company.

The spare parts sales for the year stood at Rs. 2,340.6 crores (including exports of Rs. 284 crores) as compared to Rs. 2,103 crores (including exports of Rs. 195.3 crores) in the previous year, registering a growth of 11.3%.

Farm Equipment Sector

Your Company’s Farm Equipment Sector recorded total sales of 3,30,436 tractors (domestic export) as against 3,19,623 tractors sold in the previous year thus recording a growth of 3.4%. This includes 3,403 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 7,87,304 tractors, a growth of 8%. In the first half of the year, the industry had good growth on back of a third consecutive year of good monsoon, increase in MSPs and Governments’ thrust on Agriculture and rural development. In the second half of the year, there was a reversal of the sentiment at large, resulting in slowing down of the demand.

In the domestic market, your Company sold 3,16,742 tractors, as compared to 3,04,019 tractors in the previous year, recording a growth of 4.2%. In a very competitive industry, your Company continued its market leadership for the 36th consecutive year, with a market share at 40.2%.

Your Company’s growth was driven by good performance of all products under the Mahindra and Swaraj Brands. The new product trio of Mahindra NOVO, YUVO and JIVO have helped build the ‘technology leadership’ image for the Company. For the year under review, your Company launched Mahindra NOVO 65 and 75 HP tractors in the higher HP segment.

For the year under review, your Company exported 13,555 tractors which is a degrowth of 12.3% over the previous year. This degrowth is due to one-time trade stock correction in key export markets.

Spare parts net sales for the year stood at Rs. 691.7 crores (including exports of Rs. 56.5 crores) as compared to Rs. 605.3 crores (including exports of Rs. 52.9 crores) in the previous year, registering a growth of 14.3%.

Other Businesses

Mahindra Powerol

Under the Mahindra Powerol Brand, your Company has been a leader in providing power back-up solutions to the telecom industry for the past 12 years. To cater to changing customer needs, your Company has expanded presence in tele infra management and in the energy management solutions space.

In the retail genset business, your Company is the No. 2 brand by volume, offering a wide range of solutions from Lower KVA range to mid to higher KVA range. With a focus to provide greener solutions, your Company became first in the country to launch Gas Powered Gensets.

Construction Equipment Business

For the year under review, your Company (under the Mahindra EarthMaster brand) sold 1,286 Backhoe Loaders (BHLs) against 1,229 in Financial Year 2018, which is a growth of 4.6%. With growth in the infrastructure sector, the BHL market in India grew 24.5% over the previous year. Your Company continues to be at 4th position in the BHL industry.

Your Company has presence in the fast-growing road construction equipment business through motor graders (under the Mahindra RoadMaster brand). For the year under review, your Company sold 319 motor graders as against 164 in the Financial Year 2018.

Two-Wheeler Business

For the Financial Year 2018-19, your Company sold 10,496 two-wheelers (including 6,480 exports).

In line with the revised strategy for the two-wheeler business, your Company through its subsidiary, Classic Legends Private Limited (CLPL) reintroduced the iconic brand ‘Jawa’ to the Indian market with the launch of new range of JAWA motorcycles - Jawa and Jawa Forty Two.

Current Year’s review

During the period 1st April, 2019 to 28th May, 2019, 69,280 vehicles were produced as against 72,813 vehicles and 65,200 vehicles were dispatched as against 67,244 vehicles during the corresponding period in the last year. During the same period 53,715 tractors were produced and 52,016 tractors dispatched as against 56,961 tractors produced and 57,290 tractors dispatched during the corresponding period in the previous year.

Going forward, economic activity is likely to be supported by several favourable factors. The India Meteorological Department has forecast ‘a near normal monsoon’ for the coming season. Bank credit off-take has improved and is becoming increasingly broad-based and there has been an increase in financial flows to the commercial sector. Further, the Reserve Bank of India has cut policy rates by 50 basis points in early 2019 and is expected to remain accommodative as inflation is projected to remain below its target level of 4% during the year. Importantly, stability in crude oil and other commodity prices too may bode well for growth.

However, there could be headwinds from greater than expected moderation in global growth and global trade as well as unanticipated volatility in global financial markets.

Finance

Financial Year 2018-19 started on a strong note, however cracks began to appear towards the second half of the year as the global expansion - while persisting overall - became more divergent. Business activity softened on account of trade tensions between the United States and China, ambiguity on Brexit and tightening of financial conditions amidst policy uncertainty. Global GDP which grew at a multi-year high of 3.8% in 2017, dropped to 3.6% in 2018 and is expected to taper down to 3.3% in 2019 as per IMF estimates.

The growth momentum in US remained strong amid strong employment generation and consumption growth, however the global headwinds have made the Federal Reserve pause on its interest rate hike path. Euro area economy lost more momentum than expected as consumer and business confidence weakened across all major economies causing the European Central Bank to remain accommodative for longer than expected.

Crude oil prices saw huge volatility during the financial year reflecting supply influences, including US policy on Iranian oil exports and fears of softening global demand.

Emerging market economies had a turbulent year as they contended with rising US interest rates, strengthening dollar, trade tensions and volatile crude prices. Countries with weaker fundamentals and homegrown problems such as Argentina and Turkey were the hardest hit. China’s economic growth rate which has been in a secular decline was the most affected by trade uncertainties. To ease the pressure on the economy and prevent a dramatic slowdown, Chinese officials steadily increased stimulus and also sought to control its burgeoning debt levels.

On the domestic front, while India remained one of the global outperformers in terms of growth, the momentum showed moderation in the second half. Consumer Price inflation declined sharply since mid-2018 driven by the sustained fall in food inflation, with the full year inflation printing at 3.4% against RBI’s target of 4%. RBI which raised policy rates by 50 bps in the first half of the year in response to the impact of Fed rate hikes, felt confident to give a 25 bps cut towards the end of the year supported by benign inflation and slowing growth.

The Indian rupee too came under sustained pressure during the first half due to higher crude oil prices and foreign portfolio outflows touching an all-time high of 74.48 in October, 2018. However, in the later part of the financial year, moderation in international crude oil prices, a dovish US Fed policy stance, buoyed appetite for emerging market assets led to an appreciation bias with Rupee closing the year at 69.20. The financial markets went through a challenging year as nonbanking financial companies (NBFCs) suffered liquidity issues, raising concerns of systemic risk and liquidity across the entire financial system. Systemic Liquidity was under pressure throughout the year leading the RBI to inject a total liquidity of Rs. 2.98 lakh crore in the market in 2018-19. Due to credit concerns coupled with tight liquidity, the transmission of RBI rate cuts is yet to be seen.

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 availed short term trade finance, including factoring of receivables. As on 31st March, 2019, Rs. 448.54 crores of short term trade finance, including receivables factored, was outstanding. During the year, your Company repaid Rs. 151.54 crores of long term borrowings from internal accruals.

The Company’s 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 total Debt to Equity Ratio was 0.08 as at 31st March, 2019.

Your Company has been rated by CRISIL 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 Debenture (“NCD”) programme, CRISIL, ICRA and India Ratings have re-affirmed their credit ratings of CRISIL AAA/Stable, [ICRA]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 has also been identified as a “Large Corporate” as per the criteria under SEBI Circular No. SEBI/HO/DDHS/CIR/P/2018/144 dated November 26, 2018.

Investor Relations (IR)

Your Company continuously strives for excellence in its IR engagement with International and Domestic investors and has set up feedback mechanism to measure IR effectiveness. Structured conference calls and periodic investor/analyst interactions including one-on-one meetings, participation in investor conferences, quarterly earnings calls, Video Conferencing across various key geographies and annual analyst meet with the Chairman, Managing Director and Business Heads were organised during the year. Your Company interacted with around 685 Indian and overseas investors and analysts (excluding quarterly earnings calls and specific event related calls) during the year. Your Company always believes in leading from the front with emerging best practices in IR and building a relationship of mutual understanding with investor/analysts. As a key milestone in this continuing endeavour, your Company created a digital interactive annual review of the Company’s performance on the Corporate website to provide an interactive experience beyond what is available in the Annual Report. The Company had created its first Integrated Annual Report (for Financial Year 2018). Your Company also continues to organise con-call on Environment, Social and Corporate Governance (ESG) for analysts and investors, which has received excellent feedback from investors and ESG analysts for this pioneering initiative. Your Company ensures that critical information about the Company is available to all the investors by uploading all such information at the Company’s website. Your Company has created a ‘Group Investor Relations Council’ to share best practices across all the listed Group Companies and learn from each other. Your Company has also been nominated for the IR Magazine Awards - India 2019 in 3 categories namely Best financial reporting (large cap), Best use of media and technology and Best investor meetings (large cap).

Dividend

Your Directors are pleased to recommend a dividend of Rs. 8.50 per Ordinary (Equity) Share of the face value of Rs. 5 each on the Share Capital, payable to those Shareholders whose names appear in the Register of Members as on the Book Closure Date. The equity dividend outgo for the Financial Year 2018-19, inclusive of tax on distributed profits (after reducing the tax on distributed profits of Rs. 86.58 crores on the dividends declared by subsidiaries as of the date of this report and receivable during the current Financial Year 2019-20) would absorb a sum of Rs. 1,187.35 crores [as against Rs. 1,054.53 crores comprising the dividend of Rs. 7.50 per Ordinary (Equity) Share of the face value of Rs. 5 each on the enhanced share capital and tax thereon paid for the previous year]. Further, the Board of your Company decided not to transfer any amount to the General Reserve for the year under review.

The dividend pay-out is in accordance with the Company’s Dividend Distribution Policy.

Dividend Distribution Policy

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

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 Financial Statements as stated above are also available on the website of the Company and can be accessed at the Web-link: http://www.mahindra.com/ resources/FY19/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, has reported a consolidated operating revenue of Rs. 34,742 crores in the current year as compared to Rs. 30,773 crores in the previous year, an increase of 13%. Its consolidated profit after tax after noncontrolling interests is Rs. 4,298 crores as compared to Rs. 3,800 crores in the previous year, an increase of 13%.

The Group’s finance company, Mahindra & Mahindra Financial Services Limited (Mahindra Finance), reported a consolidated operating income of Rs. 10,372 crores during the current year as compared to Rs. 7,884 crores in the previous year, a growth of 32%. The consolidated profit after tax after non-controlling interests for the year is Rs. 1,827 crores as compared to Rs. 1,185 crores in the previous year, a growth of 54%.

Mahindra Lifespace Developers Limited, the subsidiary in the business of real estate and infrastructure registered a consolidated operating income of Rs. 593 crores as compared to Rs. 566 crores in the previous year. The consolidated profit after tax after non-controlling interests for the year is Rs. 120 crores as compared to Rs. 101 crores in the previous year.

Mahindra Holidays & Resorts India Limited, the subsidiary in the business of timeshare registered a consolidated operating income of Rs. 2,239 crores as compared to Rs. 2,317 crores in the previous year. The consolidated profit after tax after non-controlling interests for the year is Rs. 60 crores as compared to Rs. 132 crores in the previous year.

Mahindra Logistics Limited, a listed subsidiary in the logistics business has registered a consolidated operating income of Rs. 3,851 crores as compared to Rs. 3,416 crores in the previous year, an increase of 13%. The consolidated profit after tax after non-controlling interests for the year is Rs. 86 crores as compared to Rs. 64 crores in the previous year, an increase of 34%.

Ssyangyong Motor Company, the Korean subsidiary of the Company has reported revenues of Rs. 24,184 crores in the current fiscal year as compared to Rs. 20,410 crores in the previous year. The loss for the year is Rs. 345 crores as compared to loss of Rs. 498 crores in the previous year.

The consolidated group profit before exceptional item and tax for the year is Rs. 7,280 crores as against Rs. 6,590 crores in the previous year - a growth of 10.47%. The consolidated profit after tax after non-controlling interest and exceptional items for the year is Rs. 5,315 crores as against Rs. 7,510 crores in the previous year.

During the year under review, Mahindra Susten Bangladesh Private Limited, Mahindra Knowledge Park Mohali Limited, Blitz 18-371 GmbH, Ssangyong Australia Pty Limited, Mahindra Summit Agriscience Limited, Mahindra Automotive Mauritius Limited, Mahindra Top Greenhouses Private Limited, Passeport Sante SL, PT Mahindra Accelo Steel Indonesia, Harkey Acquisition, L.L.C., USA, MSPE Urja S.R.L. and Mahindra Armored Vehicles Jordan, LLC. became subsidiaries of your Company.

Subsequent to the year end, Mahindra Finance CSR Foundation (Section 8 company) became subsidiary of your Company.

During the year under review, Merakisan Private Limited, Gipp Aero Investments Pty Ltd, Aerostaff Australia Pty. Ltd, Mahindra Sanyo Special Steel Private Limited and Kiinteisto Oy Himoksen Tahti 2, Finland ceased to be subsidiaries of your Company.

Subsequent to the year end, Orizonte Business Solutions Limited ceased to be a subsidiary of your Company.

During the year under review, Mahindra Retail Private Limited was converted into a Public Limited Company and accordingly changed its name to Mahindra Retail Limited. Further, Blitz 18-371 GmbH changed its name to Automobili Pininfarina GmbH, Industrial Cluster Private Limited changed its name to Mahindra Industrial Park Private Limited, Mahindra Racing SpA changed its name to PMTC Engineering SpA, Mahindra Bebanco Developers Limited changed its name to Mahindra Bloomdale Developers Limited, Harkey Acquisition, L.L.C., USA changed its name to Automobili Pininfarina Americas Inc. and EPC Industrie Limited changed its name to Mahindra EPC Irrigation Limited.

Subsequent to the year end, Machinepulse Tech Private Limited changed its name to Mahindra Teqo Private Limited and Passeport Sante SL changed its name to Holiday Club Canarias Vacation Club SLU.

During the year under review, Mahindra Ideal Lanka (Private) Limited and Mahindra Sanyo Special Steel Private Limited became Associates of your Company.

A Report on the performance and financial position of each of the subsidiaries, associates and joint venture companies included in the Consolidated Financial Statement 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 at the Web-link: http:// www.mahindra.com/resources/FY19/AnnualReport.zip

C. JOINT VENTURES, ACQUISITIONS AND OTHER MATTERS

Resson

Your Company acquired a 10% equity stake on a fully diluted basis in Resson Aerospace Corporation, a start-up based in Canada and focussed on precision agriculture solutions, by subscribing to 800,402 Series C Preferred Shares. Resson uses imagery analytics to develop artificial intelligence based solutions to assist farmers in predicting anomalies in crops and to take preventive action. This investment is a step in your Company’s aim to bring pioneering technology to Indian farming.

Sampo

During the year, your Company increased its shareholding in Sampo Rosenlew, OY, from 35% to 49%, by investing approximately Euro 4.66 million. Sampo Rosenlew, based in Finland, makes combine harvesters with markets in Europe, Africa and CIS.

Joint Venture between EPC Industrie Limited and Top Greenhouses Ltd

During the year, Mahindra EPC Irrigation Limited (formerly known as EPC Industrie Limited), a subsidiary of the Company, formed a Joint Venture with Top Greenhouses Ltd, an Israeli company, wherein Mahindra EPC Irrigation Limited holds a 60% equity stake. Top Greenhouses is a leading player in Israel for protected cultivation, and the Joint Venture is expected to bring world-class greenhouse technology to Indian farmers.

OFD sold 40% stake in its subsidiary ODA to Advantage Group

During the year, Origin Fruit Direct B.V. (“OFD”) based out of Netherlands, an indirectly owned subsidiary of your Company sold 40% stake in its subsidiary named Origin Direct Asia Ltd., Hong Kong (“ODA”) to Advantage Group Holdings Ltd. (“Advantage”). Advantage is an affiliate to Zest Fruit Pty Ltd. (“Zest”) based out of South Africa which is a large grower/distributor of fruits. Prior to the transaction, Zest was a supplier of fruits to OFD and intended to expand its operations in China through an investment in ODA. As part of the overall transaction, there is a long-term supply agreement that has been executed between ODA and Zest. By entering into this relationship it is envisaged that ODA’s market position would strengthen due to its “direct linkage” to Zest, a major grower resulting in security of stable fruit supply for ODA.

Mahindra Agri enters into Crop Care JV with Sumitomo Corporation

In October, 2018, Mahindra Agri Solutions Limited (“MASL”), a subsidiary of your Company entered into a definitive agreement with Sumitomo Corporation, Japan (“SC”) to form a joint venture company named Mahindra Summit Agriscience Limited (“MSAL”) to be held 60% by MASL and 40% by SC. As a first step MASL spun-off its existing Crop Care business into MSAL, pursuant to which in April, 2019, SC along with its affiliates purchased a 40% stake in MSAL from MASL. The combined strength of both the shareholders will leapfrog MSAL into the next orbit of growth. The partnership envisages a pipeline of specialty, new generation products with unique and latest molecules to effectively manage pest and insect related challenges faced by farmers. With this, MASL became the first Indian company to have a JV partner that has deep relationships with large Japanese R&D houses.

Automobili Pininfarina, the World’s Newest Sustainable Luxury Car Brand

During the year, your Company incorporated a new step down subsidiary named Automobili Pininfarina GmbH (“AP”) based out of Munich, Germany. Currently, AP is 100% owned by a newly incorporated Mauritian holding company named Mahindra Automotive Mauritius Ltd. AP will design, engineer and manufacture high technology, extreme performance and luxury electric vehicles. The intention is to launch an electric hypercar in 2020 offering extreme performance.

In May 2016, your Company’s Joint Venture entity (held 40% by the Company and 60% by Tech Mahindra) had acquired a majority stake in Pininfarina SpA. AP will leverage Pininfarina’s legendary automotive design expertise.

Capital Raising by Ssangyong Motor Company, a South Korean listed subsidiary of your Company through a Third Party Allotment Process

During the year under review, Ssangyong Motor Company (“SYMC”), a South Korean listed subsidiary of your Company, received approval of its Shareholders in October, 2018 for raising KRW 50 billion through equity issuance at a minimum price of KRW 4,200 per share, to meet future capex requirement for new product development and to strengthen its Balance Sheet.

Pursuant to this, and as approved by SYMC’s Board of Directors, in January, 2019, SYMC issued 1,18,90,606 shares at a price of KRW 4,205 per share, by way of Third Party Allotment process, in accordance with Korean Regulations. Your Company was the sole subscriber to this issuance and invested KRW 50 billion (approximately Rs. 316.5 crores). Consequently, your Company’s equity stake in SYMC increased from 72.46% to 74.65%.

Consolidation of Smartshift and Porter

Orizonte Business Solutions Limited (“Smartshift”) was a step down subsidiary of your Company which owned and operated a technology enabled load exchange marketplace platform for matching the needs of cargo owners with transporters. Resfeber Labs Private Limited (“Porter”) is in a similar business. As mentioned in the last Annual Report of your Company, in order to leverage synergies and obtain greater economies of scale for both businesses, your Company agreed to a Scheme to merge Smartshift and Porter and make additional investments into both these entities.

The National Company Law Tribunal approved the Scheme and the Scheme has been made effective from 25th April, 2019. Pursuant to the merger being effective, Smartshift ceased to be a subsidiary of the Company. Post-merger, the shareholding of your Company and its subsidiaries in Porter (the combined entity) taken on a fully diluted basis is 30.8% for the Company, 2.5% for Mahindra & Mahindra Financial Services Limited and 6.9% for Mahindra Trucks and Buses Limited.

Mahindra and Ford strengthen ongoing strategic collaboration

In the Financial Year 2017-18, your Company had announced its intent to explore a strategic alliance with Ford Motor Company (“Ford”), to leverage Ford’s global reach and expertise and your Company’s scale in India and its successful operational model during a period of unprecedented transformation in the global automotive industry. To that end the Company had signed several MoUs with Ford which included specific areas of connected vehicle projects, battery electric vehicle, powertrains and product development of midsize and compact SUVs.

In pursuance of the above, your Company and Ford signed definitive agreements for:

- Powertrain sharing: As part of this arrangement, your Company would supply Bharat Stage VI (BS-VI) compliant gasoline engines to Ford for product programs in India.

- Connected car: As per this agreement, your Company and Ford would jointly develop connected vehicle solutions to be deployed across your Company’s and Ford products.

- Development and supply of SUVs: This arrangement entails development, manufacturing and supply of a new mid-size SUV on a Mahindra product platform by your Company for Ford.

The above agreements are significant steps towards strengthening the ongoing strategic collaboration between your Company and Ford.

Mahindra First Choice Services Limited acquires key assets of Carnation Auto (India) Private Limited

During this year, Mahindra First Choice Services Limited (“MFCS”), a subsidiary of your Company, had acquired key assets of Carnation Auto (India) Private Limited (“CAPL” or “Carnation”). This was an asset acquisition under IBC liquidation process (Insolvency & Bankruptcy Code) run by the Official Liquidator of CAPL appointed by an order of National Company Law Tribunal (“NCLT”). MFCS acquired key assets of Carnation’s car servicing business including the trademark ‘Carnation’, its website, software licenses and Carnation’s franchisee workshop network. The asset acquisition does not include the liabilities and past dues. This strategic move will strengthen the MFCS business and further consolidate its leadership position in the Indian Automotive Aftermarket Segment.

Divestment in Mahindra Sanyo Special Steel Private Limited

During this year, your Company has sold 26,36,401 Equity Shares (22% of the share capital) of Rs. 10 each in Mahindra Sanyo Special Steel Private Limited (“MSSSPL”), a subsidiary of your Company. Pursuant to this transaction, the shareholding of the Company in MSSSPL has come down from 51% to 29% of its share capital. Consequently, MSSSPL ceased to be a subsidiary of the Company. Consideration received from such sale was Rs. 146,32,02,555. Subsequently MSSSPL has further raised capital from its existing shareholders and due to non-subscription to the capital issue of MSSSPL by your Company, the stake of your Company in MSSSPL has further diluted to 22.81%.

Scheme of Merger by Absorption of Mahindra Vehicle Manufacturers Limited, a wholly owned subsidiary of the Company (“MVML”) with the Company

Subsequent to the year end, the Board of Directors of the Company at its Meeting held on 29th May, 2019, subject to requisite approvals/consents, approved the Scheme of Merger by Absorption of Mahindra Vehicle Manufacturers Limited, a wholly owned subsidiary of the Company (“MVML”) with the Company and their respective Shareholders (“Scheme”) under the provisions of sections 230 to 232 of the Companies Act, 2013. The Appointed Date of the Scheme would be 1st April, 2019 and the entire assets and liabilities of MVML would be transferred to and recorded by the Company at book values. The entire share capital of MVML is held by the Company. Upon the Scheme being effective, all shares (preference and equity) held by the Company in MVML as on the Effective Date shall stand cancelled, without any further act or deed.

D. INTERNAL FINANCIAL CONTROLS

The Corporate Governance Policies guide the conduct of affairs of your Company and clearly delineates 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 Information Management Policy reinforces the control environment. The systems, Standard Operating Procedures and controls are reviewed by Management. These systems and controls are audited by Internal Audit and their findings and recommendations are reviewed by the Audit Committee which ensures the implementation.

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 Management, no reportable material weakness or significant deficiencies in the design or operation of internal financial controls was observed.

Your Company recognises 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 Control 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. CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All Related Party Transactions entered during the year were in the ordinary course of business and on arms length basis. During the year under review, your Company had entered into Material Related Party Transactions, i.e. transactions exceeding ten percent of the annual consolidated turnover as per the last audited financial statements, with Mahindra Vehicle Manufacturers Limited, a wholly owned subsidiary of your Company. These transactions too were in the ordinary course of business of your Company and were on arms length basis, details of which, as required to be provided under section 134(3)(h) of the Companies Act, 2013 are disclosed in Form AOC-2 as Annexure II and 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 at the Web-link: http://www.mahindra.com/resources/FY19/ AnnualReport.zip

G. AUDITORS

Statutory Auditors and Auditors’ Report

Messrs B S R & Co. LLP, Chartered Accountants (ICAI Firm Registration Number 101248W/W-100022) were appointed as the Statutory Auditors of the Company to hold office for a term of 5 years from the conclusion of the 71st Annual General Meeting (AGM) held on 4th August, 2017 until the conclusion of the 76th AGM of the Company to be held in the year 2022.

The Auditors’ Report 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 given by the Secretarial Auditor.

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

Secretarial Audit of Material Unlisted Indian Subsidiary

Mahindra Vehicle Manufacturers Limited (“MVML”), a material subsidiary of the Company undertakes Secretarial Audit every year under Section 204 of the Companies Act, 2013. The Secretarial Audit of MVML for the Financial Year 2018-19 was carried out pursuant to Section 204 of the Companies Act, 2013 and Regulation 24A of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Secretarial Audit Report of MVML submitted by Mr. Sachin Bhagwat, Practicing Company Secretary, 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 2018-19 for all applicable compliances as per Securities and Exchange Board of India Regulations and Circulars/Guidelines issued thereunder. The Annual Secretarial Compliance Report duly signed by Mr. Sachin Bhagwat has been submitted to the Stock Exchanges within 60 days of the end of the Financial Year and is annexed at Annexure IV to this Board’s Report.

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 2018-19.

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 2019-20 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, details of which needs to be mentioned in this Report.

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. 6 and 35 to the Financial Statements.

I. PUBLIC DEPOSITS AND LOANS/ ADVANCES

Your Company had discontinued its Fixed Deposit Scheme for 36 months with effect from the close of office hours on 31st January, 2014 and has also discontinued acceptance of Fixed Deposits with effect from 1st April, 2014.

All the deposits from public and Shareholders had already matured as at 31st March, 2017. Out of the total outstanding of 41 deposits of Rs. 17.24 lakhs from the public and shareholders as at 31st March, 2019, all deposits amounting to Rs. 17.24 lakhs, had matured and had not been claimed as at the end of the Financial Year. Since then 1 of these deposits of the value of Rs. 0.45 lakhs 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 SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 are furnished separately.

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 SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is disclosed separately in the Financial Statements of the Company.

J. EMPLOYEES

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) Mr. Anand G. Mahindra - Executive Chairman

(b) Dr. Pawan Goenka - Managing Director

(c) Mr. V S Parthasarathy - Group CFO & Group CIO

(d) Mr. Narayan Shankar - Company Secretary

There has been no change in the KMPs during the year under review.

Employees’ Stock Option Scheme

During the year under review, on the recommendation of the Governance, Nomination and Remuneration Committee 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.

The Company has in force the following Schemes which get covered under the provisions of SEBI (Share Based Employee Benefits) Regulations, 2014 (SBEB Regulations):

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

There are no material changes made to the above Schemes and these Schemes are in compliance with the SBEB Regulations. Your Company’s Auditors, Messrs B S R & Co. LLP, have certified that the Company’s above-mentioned Schemes have been implemented in accordance with the SBEB Regulations, and the Resolutions passed by the Members for the 2000 Scheme and the 2010 Scheme.

Information as required under the SBEB Regulations read with SEBI Circular CIR/CFD/POLICY CELL/2/2015 dated 16th June, 2015 have been uploaded on the Company’s website and can be accessed at the Web-link: http:// www.mahindra.com/resources/FY19/AnnualReport.zip

Particulars of Employees and related disclosures

The Company had 258 employees who were in receipt of remuneration of not less than Rs. 1,02,00,000 during the year ended 31st March, 2019 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 Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are available at the Registered Office of the Company during working hours, 21 days before the Annual General Meeting and shall be made available to any Shareholder on request. Such details are also available on your Company’s website and can be accessed at the Web-link: http://www.mahindra.com/resources/FY19/ AnnualReport.zip

Disclosures with respect to the remuneration of Directors, 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 include ‘Rise for Associates’, industrial relations skills for frontline officers, cultural diagnostics projects, transformational work culture projects, e-compliance, e-portal for reward and recognition of associates and Code of Conduct for associates. The Transformational Work Culture Committee (TWCC) leads the design and implementation of these programs.

With the objective of developing skills and fostering togetherness at the workplace, your Company implements multiple training and engagement programs on an ongoing basis. These include positive attitude, stress management, creativity, team effectiveness, safety and environment, quality tools, TPM, skill building programs, customer focus and a program for union leadership development.

The Mahindra Skill Excellence initiative is a holistic approach to enhance the skill and capabilities of shop floor associates and has received good participation across manufacturing facilities. As a result of this effort, associates from your Company have participated at various international skill competitions which include Beijing Arc Cup and Euroskills 2018. At the Beijing Arc Cup, a female associate from your Company was awarded as ‘Outstanding Female Welder’.

In an endeavor to improve quality, reduce cost, ensure safety and improve productivity, your Company’s shop floor associates generated on an average 18 ideas per person.

Significant emphasis was also laid towards raising awareness on health and wellness of employees through annual medical check-ups, health awareness activities. Diet food has become a way of life over the past three years. Your Company maintains an ‘Employee Health Index’ at an individual level and this has been a useful tool in identifying employees who require focused 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. Bonus settlements were amicably agreed upon at all locations.

In a span of 16 months (September, 2017 to March, 2019), nine wage settlements with various Unions were amicably concluded with an overall productivity rise ranging from 10% to 15%.

The sustained efforts towards building a transformational work culture resulted in zero production loss in the Financial Year 2018-19 and helped create a collaborative, healthy and productive work environment.

Safety, Occupational Health and Environment

During the year under review, your Company revised its Safety, Occupational Health & Environment (SOH&E) Policy. The leadership’s commitment towards SOH&E, is demonstrated through inclusion of many new compliances along with its voluntary commitments. Implementation of various initiatives under the policy and achievement to set objectives were assessed through management reviews.

At each Plant location, annual events were organised and commemorated like Road Safety Week, National Safety Day/ Month, Fire Service Week. Awareness programs were conducted for all stakeholders through classroom sessions and e-learning modules. To strengthen the safety culture, Behaviour Based Safety (BBS) - Level 2 is being implemented at all Plants.

Your Company carried out statutory safety audits, Fire Equipment Audit, Risk Assessment of Licensed premises, as per the amended legal requirements. For the year under review, your Company achieved substantial reduction in the fire load by way of installation of modern equipment in critical areas and relocation of flammable material as appropriate.

In line with the ‘Go Green’ philosophy, your Company is continuously adopting new techniques to eliminate and minimize the environmental impact. Various projects have been implemented by your Company in air, water-waste water management and solid waste management. These initiatives are also extended to the supplier community of your Company.

During the year under review, your Company signed agreements with Extended Producer Responsibility Organizations (EPRO) recognized by Pollution Control Boards for 100% integral Plastic Waste Management. These agreements include the plastic waste generated at premises of suppliers and dealers of your Company.

Your Company continued the commitment to improve the wellbeing of employees and contract associates through various activities under project ‘Parivartan’. This includes activities like fitness improvement challenge (MRise), Mindfulness, Walkathon, Yoga, Zumba, medical check-ups, health consultation and counselling. As a result of many initiatives, the average Health index of its employees has improved as compared to the previous year. Further, all locations observed World Health Day, World Heart Day, World Kidney Day and World Diabetes Day. All associates of your Company were trained in First Aid.

To create awareness among society at large, your Company has installed a display screen that displays real time readings for all parameters of Air Quality. This screen is installed just outside the manufacturing plant in Mumbai, which is located on the Western Express highway with high density vehicular traffic.

Your Company has adopted the standard on Global Reporting Initiative (GRI) and has undertaken various projects aimed at climate change mitigation, sustainable source use and protection of bio-diversity. Some examples of successful initiatives are Waste Heat Recovery, Green Platinum rated Buildings in Existing Building Category, Projects for Carbon Neutrality and Solar power installation.

In addition to above, World Ozone Day, World Environment Day, No Print Day, World Earth Day, World Water Day and Energy Conservation Week and Water Conservation Week are observed on an annual basis.

Certifications/Recertifications

All Plants of your Company have been recertified under standard ISO 14001: 2015 and OHSAS 18001: 2007. Further, all Plants are in the process of implementing, integrated management system along with adopting the revised standard ISO 45001:2018.

As a result of efforts over the last few years, nine plants of your Company are certified ‘Zero Waste to Landfill’, by Intertek USA.

The Company revises its targets under SOH&E year on year, and the performance against these targets are reviewed periodically by Senior Management. Focused initiatives involving all stakeholders coupled with management reviews have helped to improve the SOH&E performance of your Company in the period 2018-19.

K. BOARD & COMMITTEES

Directors

As mentioned in the previous Annual Report, Mr. S. B. Mainak resigned from the Board of the Company and ceased to be a Director of the Company with effect from 11th May, 2018.

Mr. M. M. Murugappan and Mr. Nadir B. Godrej were re-appointed at the 72nd Annual General Meeting held on 7th August, 2018, as Independent and Non-Executive Directors of the Company for a second term of two consecutive years each commencing from 8th August, 2018 to 7th August, 2020.

Appointment of Mr. Vijay Kumar Sharma

Pursuant to the recommendation of the Governance, Nomination and Remuneration Committee, the Board at its Meeting held on 14th November, 2018, appointed Mr. Vijay Kumar Sharma as an Additional Non-Executive Non-Independent Director of the Company representing Life Insurance Corporation of India, liable to retire by rotation with effect from 14th November, 2018. He shall hold office as an Additional Director upto the date of the Annual General Meeting of the Company to be held on 7th August, 2019.

Mr. Vijay Kumar Sharma, is a Post-Graduate and superannuated as Chairman, Life Insurance Corporation of India on 31st December, 2018. From December, 2010 to November, 2013, he served as Managing Director & Chief Executive Officer, LIC Housing Finance Limited (LICHFL), a premier housing finance company in the country. He is also on the Boards of various companies.

The Company has received the requisite Notice from a Member in writing proposing his appointment as a Non-Executive Non-Independent Director of the Company.

Retirement by rotation

Dr. Pawan Goenka retires by rotation and, being eligible, offers himself for re-appointment at the 73rd Annual General Meeting (AGM) of the Company scheduled to be held on 7th August, 2019.

Re-appointment of Independent Directors for a Second Term

The Governance, Nomination and Remuneration Committee, on the basis of performance evaluation of Independent Directors and taking into account the external business environment, the business knowledge, acumen, experience and the substantial contribution made by Dr. Vishakha N. Desai and Mr. Vikram Singh Mehta during their tenure, has recommended to the Board that continued association of Dr. Vishakha N. Desai and Mr. Vikram Singh Mehta as Independent Directors would be beneficial to the Company. Based on the above and the performance evaluation of Independent Directors, the Board recommends re-appointment of:

(i) Dr. Vishakha N. Desai for a further period from 8th August, 2019 to 30th April, 2024; and

(ii) Mr. Vikram Singh Mehta for a further period of five consecutive years commencing from 8th August, 2019 to 7th August, 2024 to hold office as Independent Directors of the Company, not liable to retire by rotation on the Board of the Company. The Company has received the requisite Notices from a Member in writing proposing their appointment as 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 SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Completion of Tenure of Independent Directors

Mr. R. K. Kulkarni and Mr. Anupam Puri would cease to hold office as Independent Directors of the Company from 8th August, 2019, upon completion of their tenure as approved by the Shareholders at the 68th AGM of the Company.

Mr. R. K. Kulkarni has been on the Board of the Company for around 22 years and has enriched the Board with his immense experience in all aspects of corporate law, M&A, litigations, strategy and management, financial reporting and processes. His vast experience in advising large Indian and multinational clients in various business sectors and expertise in legal and fiscal management was pivotal in steering the growth & diversification initiatives of the Company over a period of time.

He has been the Chairman of the Stakeholders Relationship Committee, Member of Audit Committee, Governance, Nomination and Remuneration Committee and other committees of the Board.

Quote from Executive Chairman

“Mr. R. K. Kulkarni joined the Board of the Company in 1997 and played a key role in nurturing the Legal, Compliance and Governance culture of your Company.

Apart from being a leading proponent of governance, ethics and values, he also brought a commercial mindset while framing, evaluating and executing strategies of your Company. This rare combination of qualities added a valuable perspective and dimension to the deliberations and decision making of the Board.

He has always brought a solution based approach to issues while remaining committed to the highest standards of governance and excellence. He has made significant contributions as a Director of the Company and as a member of several of its committees and his inputs have greatly benefited the Board and the Company.

I am grateful for Mr. Kulkarni’s counsel and friendship. Even though his term as a Director is ending, he has assured the Management of his continuous availability and support, which the Management will certainly draw upon. I wish him many years of good health and happiness.”

Mr. Anupam Puri has been on the Board of the Company for around 18 years. He brought with him a global mindset and experience in driving business success in markets around the world with an understanding of diverse business environments, economic conditions, sensitivity to cultural diversity and adaptability. He provided thought leadership in business strategy and handling various organizational issues with his immense international knowledge, financial expertise and experience. He has been a Member of the Strategic Investment Committee and has contributed in evaluating various proposals which has enabled the Company build a strong and diversified portfolio of investments with sustainable growth.

Quote from Executive Chairman

“Mr. Anupam Puri, fondly known as “Tino” joined the Board of your Company in 2001.

With his extensive experience in business strategy and financial structuring, he critically and constructively challenged management on various business and growth proposals put forth at the Strategic Investment Committee and the Board, and his concurrence provided valuable validation to the Management and Board in pursuing such opportunities.

Tino’s expertise in striking a delicate balance between maintaining independence and governance oversight and providing constructive support to Management (especially on matters of strategy and M&A) has been particularly valuable. He championed the cause of fostering a culture that promotes long-term thinking, discipline, and accountability.

Tino has been on your Company’s Board for a long time. The baseline model he has helped to create will continue to guide your Company in its pursuit of organic and inorganic growth opportunities. I wish Tino many years of good health and happiness.”

The Board placed on record its deep appreciation of the valuable services rendered by Mr. R. K. Kulkarni and Mr. Anupam Puri during their tenure as Directors of the Company.

Performance Evaluation

Pursuant to the provisions of the Companies Act, 2013, and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has carried out an annual evaluation of its own performance and that of its Committees as well as performance of the Directors individually. 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.

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.

A separate exercise was carried out by the Governance, Nomination and Remuneration Committee 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 Executive Chairman of the Company was also carried out by the Independent Directors, taking into account the views of the Managing Director and Non-Executive Directors. The Directors expressed their satisfaction with the evaluation process. The Independent Directors and Executive Chairman also carried out performance evaluation of the Managing Director of the Company.

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.

During the year under review, your Company made changes in the Policies mentioned at (a) and (b) above to align with the amendments made pursuant to the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Policies mentioned at (a) and (b) above are available on the website at the following link: http://www.mahindra. com/resources/FY19/AnnualReport.zip

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 SEBI 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 SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (the “Listing Regulations”), the Company imparted various familiarisation programmes for its Directors including review of Investments of the Company by Strategic Investment Committee, Industry Outlook at the Board Meetings, Regulatory updates at Board and Audit Committee Meetings covering changes with respect to the Companies Act, the Listing Regulations, Taxation and other matters, Presentations on Internal Control over Financial Reporting, Operational Control over Financial Reporting, Prevention of Insider Trading Regulations, SEBI Listing Regulations, Framework for Related Party Transactions, Plant Visit, Meeting with Senior Executive(s) of your Company, etc. Pursuant to Regulation 46, the details required are available on the website of your Company at the web link: http://www. mahindra.com/resources/FY19/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 31st March, 2019, 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 31st March, 2019 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 31st March, 2019;

(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 31st March, 2019.

Board Meetings and Annual General Meeting

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

During the year 1st April, 2018 to 31st March, 2019, five Board Meetings were held on: 29th May, 2018, 7th August, 2018, 14th November, 2018, 7th & 8th February, 2019 and 25th March, 2019. The 72nd Annual General Meeting (AGM) of the Company was held on 7th August, 2018.

Meetings of Independent Directors

The Independent Directors of your Company meet before the Board Meetings without the presence of the Executive Chairman or the Managing Director or other Non-Independent Director 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 Executive Chairman of the Company (taking into account the views of the Executive and Non-Executive Directors), review the performance of the Company, 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), Mr. Nadir B. Godrej, Mr. M. M. Murugappan and Mr. R. K. Kulkarni. 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.

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

L. GOVERNANCE

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. 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 SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 forms part of the Annual Report.

Vigil Mechanism

The Vigil Mechanism as envisaged in the Companies Act, 2013, the Rules prescribed thereunder and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is implemented through the Company’s Whistle Blower Policy to enable the Directors, employees and all stakeholders of the Company to report genuine concerns, to provide for adequate safeguards against victimisation of persons who use such mechanism and make provision for direct access to the Chairman of the Audit Committee.

Whistle Blower Policy of your Company is available on the Company’s website and can be accessed at the Web-link: http://www.mahindra.com/resources/FY19/ AnnualReport.zip

Further details are available in the Report on Corporate Governance that forms part of this Annual Report.

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

The Company has in place an Anti-Sexual Harassment Policy in line with the requirements of The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment and the Company has complied with provisions relating to the constitution of Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. All employees (permanent, contractual, temporary, trainees) are covered under this Policy. The Policy is gender neutral.

During the year under review, 4 complaints with allegations of sexual harassment were filed, which were disposed-off as per the provisions of The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and as of 31st March, 2019, no complaint was pending.

Business Responsibility Report

The ‘Business Responsibility Report’ (BRR) of your Company for the year 2018-19 forms part of this Annual Report as required under Regulation 34(2)(f) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

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 organisational structure for managing and reporting on risks.

Your Company has constituted a Risk Management Committee of the Board which is authorised to monitor and review risk management plan and risk certificate. The Committee is also empowered, inter alia, to review and recommend to the Board the 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 comprises review of risks and Risk Management Policy on 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 organisation.

M. CORPORATE SOCIAL RESPONSIBILITY AND SUSTAINABILITY

Corporate Social Responsibility (CSR)

With a Core Purpose which states that “we will 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”, it is amply evident that Corporate Social Responsibility is integral to, and at the core of whatever is done at Mahindra. With a deeper understanding of societal issues, your Company has built the ‘Rise for Good’ mission around the four pillars of Community, People, Governance and Environment. With its focus on driving positive change to enable communities to Rise, your Company’s CSR initiatives are designed to support the constituencies of girls, youth and farmers through the domains of education, health and environment. The impact of some of the flagship CSR initiatives that your Company undertook in the last financial year are given below: -

- Project Nanhi Kali, supported the education of over 1,65,291 underprivileged girls across 10 States of India. While the Company supported 18,974 Nanhi Kalis, the Mahindra Group supported the education of 66,348 Nanhi Kalis and the balance were supported by other donors. In Financial Year 2019, 71,394 girls at secondary school level were provided access to digital tablets preloaded with smart, audio visual educational content.

- Financial Year 2019 was a milestone year for the Mahindra Pride Programme, with the Mahindra Pride Classrooms crossing the 1,00,000 outreach mark. Through 2,597 Mahindra Pride Classrooms, 1,19,349 youth from ITI’s, Polytechnics and Arts & Science colleges were trained in English, Lifeskills and job preparedness, across 14 States. Of these 79,566 students were supported by the Company. The Mahindra Group also supported 9 Mahindra Pride Schools through which 6,561 youth from socially and economically disadvantaged communities were trained in ITES, Retail Hospitality & Auto Service and 100% of them were placed in lucrative jobs. The Company supported 5 Mahindra Pride Schools in Chandigarh, Chennai, Srinagar, Hyderabad and Varanasi through which 3,108 youth received livelihood training.

- Over 4,300 students benefitted through a variety of Scholarship Programs, which ranged from providing opportunities to youth from low income group families to undergo diploma courses at vocational education institutes, to allowing meritorious students to pursue their post graduate studies at reputed universities overseas, to allowing meritorious and deserving students to study at the Mahindra United World College in Pune.

- In the area of public health, your Company sponsored its 20th Lifeline Express (hospital on a train) in Arrah Bihar, through which medical care, treatment, and surgical intervention was provided to 11,119 individuals.

- Through Mahindra Hariyali 0.95 million trees were planted which contributed to improving green cover and protecting bio-diversity in the country. Of these 0.83 million trees were planted in the Araku valley, which besides greening the environment also provided livelihood support to tribal farmers growing coffee in this region. The Mahindra Group as a whole planted 1.45 million trees pan India.

- The Integrated Water Management Program (IWMP) in Hatta and Bhopal (Madhya Pradesh) led to increased water availability in 48 villages of Bhopal, thereby directly improving agricultural productivity and increasing farmer income.

- Through the Wardha Farmer Family Project and Krishi Mitra Project your Company continued to support small and marginal farmers by training them in effective farming practices including soil health, crop planning, creating model farms with biodynamic farming practices, and increasing the water table with a view to increasing crop productivity.

- Rise for Safe Roads: The first of its kind in India ‘Road Safety’ project aims to make the Mumbai Pune Express way a near ‘Zero Fatality Corridor’ by 2021. Interventions under 4E’s are conducted i.e. Engineering, Enforcement, Education and

Emergency Response. In addition, long haul truck drivers went through the Anticipatory Driving and Action Prevention Training (ADAPT™) program.

- The unique ESOPs (Employee Social Options) platform provided 26,126 employees a menu of volunteering opportunities enabling them to contribute 1,88,833 - person hours towards giving back to society.

During the last financial year, your Company received a “4 Good” rating from Economic Times, for overall excellence in CSR, as part of the ‘ET2Good4Good’ CSR Rating. Further, your Company was awarded the CII National Award for Excellence in Water Management and FICCI CSR Awards in Environment Sustainability Category for the Integrated Watershed Management Project in Bhopal.

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 can be accessed at the Company’s website through the Web-link: http:// www.mahindra.com/resources/FY19/AnnualReport.zip

CSR Committee

The CSR Committee comprises of Dr. Vishakha N. Desai (Chairperson), Mr. Anand G. Mahindra, Mr. R. K. Kulkarni, Dr. Pawan Goenka and Mr. Vikram Singh Mehta. The Committee, inter alia, reviews and monitors the CSR as well as Sustainability activities.

During the year under review, your Company spent Rs. 93.50 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. 93.37 crores. The detailed Annual Report on the CSR activities undertaken by your Company in Financial Year 2019, is annexed herewith marked as Annexure VI.

Sustainability

During the year under review, the 11th Sustainability Report for the year 2017-18 was released. The report was externally assured by DNV-GL and prepared in accordance with the GRI Standards-Core option.

Your Company continued the focus on the Environmental, Social and Governance (ESG) parameters, in the year under review by implementing Mahindra Sustainability Framework ensuring common language for sustainability across the Group. This framework defines sustainability as “Building enduring businesses by rejuvenating the environment and enabling stakeholders to rise”. Under the three pillars People, Planet and Profit of Sustainability Framework; various actions have been identified for implementation across the Group. Many of these actions are already underway as demonstrated by the Igatpuri Plant being certified as ‘Carbon Neutral’. Rudrapur, Nagpur and Jaipur are certified as ‘Zero Waste to Landfill’ plants.

Mr. Anand G. Mahindra, Executive Chairman of your Company is on the Governing Board of United Nations Global Compact. He was a co-chair at the Global Climate Action Summit held in September, 2018 in San Francisco, California.

Your Company has committed to adopt Science Based Target to restrict average global temperature rise to 2 degree Celsius in alignment of Paris Climate Change Agreement.

The Sustainability performance for your Company for the Financial Year 2018-19 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:

- Winning Asia Sustainability Reporting Award 2018 -Best Supply Chain Reporting.

- Winning Asia Sustainability Reporting Award 2018 -Best Carbon Disclosure.

- Indian Chamber of Commerce “India Corporate Governance & Sustainability Vision” Awards.

- Retaining the status of getting listed on the Dow Jones Sustainability Index - 2018 under the ‘Emerging Market Index’ for fifth year with improvement in percentile scores.

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.

N. SECRETARIAL

Share Capital

The issued, subscribed and paid-up Share Capital of the Company stood at Rs. 621.60 crores as at 31st March, 2019 comprising of 124,31,92,544 Ordinary (Equity) Shares of Rs. 5 each fully paid-up. There was no change in Share Capital during the year under review.

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, an extract of the Annual Return as on 31st March, 2019 in Form No. MGT-9 is attached as Annexure VIII and forms part of this Report.

The Annual Return of the Company has been placed on the website of the Company and can be accessed at http://www.mahindra.com/resources/FY19/ AnnualReport.zip

O. POLICIES

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

P. GENERAL

Neither the Executive Chairman nor the Managing Director of the Company received any remuneration or commission from any of the subsidiary 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 except as stated hereunder:

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 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).

For and on behalf of the Board

ANAND G. MAHINDRA

Executive Chairman

Mumbai, 29th May, 2019


Mar 31, 2019

Board’s Report

To,

The Members of

Mahindna & Mahindra Financial Services Limited

Your Directors are pleased to present their Twenty-Ninth Report together with the audited financial statements of your Company for the Financial Year ended 31st March, 2019.

The performance highlights and summarized financial results of the Company are given below:

PERFORMANCE HIGHLIGHTS

- Consolidated income for the year increased by 32% to Rs. 10,430.9 Crores as compared to Rs. 7,912.2 Crores in 2017-18;

- Consolidated income from operations for the year was Rs. 10,371.7 Crores as compared to Rs. 7,883.9 Crores in 2017-18, a growth of 32%;

- Consolidated profit before tax for the year was Rs. 2,840.8 Crores as compared to Rs. 1,904.8 Crores in

2017-18;

- Consolidated profit after tax and non-controlling interest for the year was Rs. 1,827.3 Crores as compared to Rs.1,185.2 Crores in 2017-18.

FINANCIAL RESULTS

Rs. in Crores

CONSOLIDATED

STANDALONE

March 2019

March 2018

March 2019

March 2018

Total Income

10,430.9

7,912.2

8,809.8

6,685.2

Less : Finance Costs

4,432.3

3,436.2

3,944.6

3,081.6

Expenditure

3,129.3

2,546.7

2,422.6

1,957.5

Depreciation, Amortization and Impairment

75.5

55.2

60.2

44.2

Total Expenses

7,637.1

6,038.1

6,427.4

5,083.3

Profit Before Exceptional Items and Taxes

2,793.8

1,874.1

2,382.4

1,601.9

Share of profit of associate

47.0

30.7

-

-

Exceptional items

-

-

-

64.9

Profit Before Tax

2,840.8

1,904.8

2,382.4

1,666.8

Less : Provision For Tax

Current Tax

711.4

665.2

576.8

549.5

Deferred Tax

262.1

23.3

248.5

41.2

Profit After Tax for the Year

1,867.3

1,216.3

1,557.1

1,076.1

Less : Non-controlling interests

40.0

31.1

-

-

Profit for the Year attributable to Owners of the Company

1,827.3

1,185.2

1,557.1

1,076.1

Balance of profit for earlier years

3,282.5

2,909.0

3,193.2

2,608.4

Less : Transfer to Debenture Redemption Reserve

146.7

50.5

146.7

50.5

Profit available for Appropriation

4,963.1

4,043.7

4,603.6

3,634.0

Add : Other Comprehensive Income/(Loss)

(9.5)

(13.6)

(8.6)

(12.3)

Less : Dividend paid on Equity Shares

296.6

163.4

293.8

161.0

General Reserve

155.8

88.4

155.8

89.1

Statutory Reserve

385.2

224.3

311.4

178.4

Gross obligation at fair value to acquire non-controlling interest

158.6

316.8

-

-

Transaction with non-controlling interest

-

5.4

-

-

Securities Premium on fresh issue of equity share capital

0.1

-

-

-

Add : Profit on sale of Equity Shares of subsidiaries

-

50.7

-

-

Balance carried forward

3,957.3

3,282.5

3,834.0

3,193.2

IMPLEMENTATION OF INDIAN ACCOUNTING STANDARDS (“IND AS”)

Your Company has prepared the Financial Statements in accordance with Indian Accounting Standards ("IND AS”) notified under the Companies (Indian Accounting Standards) Rules, 2015 as amended by the Companies (Indian Accounting Standards) Rules, 2016. The Company has adopted IND AS from 1st April, 2018 with effective transition date of 1st April, 2017 and accordingly, these Financial Statements together with the Financial Statements for the comparative reporting period have been prepared with the recognition and measurement principles stated therein, prescribed under Section 133 of the Companies Act, 2013 ("the Act”) read with relevant Rules issued there under and the other accounting principles generally accepted in India.

This transition to IND AS has been carried out from the erstwhile Accounting Standards notified under the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014 (as amended), guidelines issued by the Reserve Bank of India ("RBI”) and other generally accepted accounting principles in India (collectively referred to as ''''the previous GAAP”). Accordingly, the impact of transition has been recorded in the opening reserve as at 1st April, 2017 and the corresponding adjustments pertaining to comparative previous year as presented in these Financial Statements have been restated/reclassified in order to conform to current year presentation.

TRANSFER TO RESERVES

The Company proposes to transfer an amount of Rs. 155.8 Crores to the General Reserve, Rs. 311.4 Crores to the Statutory Reserve and Rs. 146.7 Crores to the Debenture Redemption Reserve. An amount of Rs. 3,834.0 Crores is proposed to be retained in the Statement of Profit and Loss.

DIVIDEND

Your Directors are pleased to recommend a dividend of Rs. 4.0 per Equity Share and also a Special Dividend of Rs. 2.5 per Equity Share aggregating Rs.6.5 per Equity Share of the face value of Rs. 2 each payable to those Members whose names appear in the Register of Members as on the Book Closure date. The Special Dividend is being recommended in the light of the very successful completion of twenty-five years of the business operations of the Company.

The dividend including dividend tax for the Financial Year 2018-19 will absorb a sum of Rs. 477.9 Crores [as against Rs. 293.8 Crores on account of dividend of Rs. 4.0 per Equity Share and tax thereon, paid for the previous year].

The dividend pay-out is in accordance with the Dividend Distribution Policy of the Company which has been approved by the Board of Directors.

DIVIDEND DISTRIBUTION POLICY

The Dividend Distribution Policy, containing the requirements prescribed in Regulation 43A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 is appended as “Annexure I” and forms part of this Annual Report.

The Dividend Distribution Policy can also be accessed on the Company''s website at the web-link: https://www.mahindrafinance.com/policies.aspx.

During the year, an amount of Rs. 4,97,120 being the unclaimed/unpaid dividend of the Company for the Financial Year ended 31st March, 2011 was transferred in September, 2018 to the Investor Education and Protection Fund Authority.

OPERATIONS

During the year under review, your Company completed 25 glorious years of its business operations in rural and semi-urban markets. Rural sentiments continued to be positive for the Company from the start of the year till November 2018. During this period both farm and infra cash flows were good enabling higher collection efficiency on a consistent basis despite subdued automobile growth. Elections in few States in November

2018 and the impending Lok Sabha Elections slowed down growth in the last few months of the year. However, even during this slowdown, your Company could maintain the asset growth as well as collections, by continuously engaging with customers.

Your Company further strengthened its position as a significant financier in rural and semi-urban geographies by providing a wide range of products and services. Your Company has retained its leadership position in financing the Mahindra range of vehicles and tractors. Your Company not only retained the status of major financier for Maruti vehicles in semi-urban and rural India but also expanded its coverage to include several leading vehicle dealers. With the Company''s vast semi-urban and rural distribution network, it could attract many OEMs like Hyundai, Renault, Nissan for a tie-up. Your Company consolidated its position as a leading financier in all Aggregator (like Ola and Uber) and Selfdrive vehicles (like Zoom and Revv) segment. In this year, your Company also emerged as a significant player in financing of Heavy, Medium Commercial Vehicles and Construction Equipment for major OEMs. Your Company has also launched pilot projects to understand the upcoming opportunities in Leasing. Your Company maintains a leading presence in the growing market of financing of pre-owned vehicles such as Cars, Utility Vehicles and Tractors.

Network Expansion

Your Company strengthened its pan-India presence with a network of 1,321 offices, which is one of the largest amongst Non-Banking Financial Companies. Your Company further expanded its geographical presence by reaching out to untapped villages and increased its footprint by opening new branches and making it more accessible to its customers. Your Company''s nationwide network of branches and locally recruited employees have facilitated in catering to the diverse financial requirements of its customers by identifying and understanding the needs and aspirations of the people. With its strong presence covering even the most remote areas of the country, your Company is providing flexible financing opportunities to aspiring individuals to realize their dreams and helping them to ''RISE''. Your Company believes that incessantly serving its customers and channel partners and enhancing customer relationship is the starting point of a great successful journey.

Enhanced Product Offerings

Your Company has earned the trust and confidence of its customers with its consistent, transparent and reliable services and as a result, customer satisfaction across its network continues to remain high. Your Company has cumulatively financed the aspirations of over 6 million customers since its inception, most of whom had no prior credit history. Your Company''s philosophy of helping rural customers by providing tailor-made products and services at their doorstep has given a big boost in transforming rural lives. Your Company has also launched Suvidha Loans to meet specific needs of its existing customers through its numerous Branches.

During the year under review, your Company continued to expand its reach in the Micro Small and Medium Enterprises ("MSME”) segment. MSME Assets Under Management crossed more than Rs. 3,655.90 Crores during the period under review, covering 3,719 customers.

A reorganized collection structure has enabled your Company to take advantage of improved rural cash flows from better yields and Minimum Support Price which augmented its overall collections.

Digital

Your Company remains firmly focused on addressing the changing but unique needs of its rural and semi-urban customers. Your Company has successfully implemented low bandwidth end-to-end mobile sales application with real time integrations with government databases and credit bureaus to disburse loans to customers anytime, anywhere. Your Company has also launched multilingual mobile application for its customers to view their current loan details and make payments. It also helps in getting pre-approved Suvidha Loans. The digital strategy of your Company focuses on providing tailor-made solutions to meet its customers'' needs. Your Company and its subsidiaries have embraced digital in performing different activities like customers'' acquisition, selling of Fixed Deposits, Mutual Funds and Insurance products in partnership with Common Service Centers Scheme. Your Company will continue to further its digital presence by extending its coverage to more activities including improving employee efficiency.

Getting Future Ready

In order to provide superior experience to its customers, your Company has entered into a long term partnership with a leading technology service provider. With this state-of-the-art technology, your Company will be in a position to delight its customers.

Building Analytics Capability

Your Company has consistently serviced over 6 million semi-urban and rural customers across 3.6 lakh villages, for the past 25 years. In the process, the Company has acquired a very rich database of these millions of customers which could be productively mined for not only increasing repeat business but also to cross-sell many other financial and insurance products. Towards this purpose, the Company has set up a Data Analytics and Insight Department with experienced data science professionals.

The overall disbursement registered a growth of 22% at Rs. 46,210.3 Crores as compared to Rs. 37,772.9 Crores in the previous year. Total Income grew by 32% at Rs. 8,809.8 Crores for the year ended 31st March, 2019 as compared to Rs. 6,685.2 Crores for the previous year. Profit Before Tax (PBT) grew by 43% at Rs. 2,382.4 Crores as compared to Rs. 1,666.8 Crores for the previous year. Profit After Tax (PAT) increased by 45% at Rs. 1,557.10 Crores as compared to Rs. 1,076.10 Crores in the previous year.

During the year under review, the Assets Under Management stood at Rs. 67,078 Crores as at 31st March, 2019 as against Rs. 52,793 Crores as at 31st March, 2018, a growth of 27%.

There has been no change in the nature of business of the Company during the year under review.

DISTRIBUTION OF MUTUAL FUND PRODUCTS

During the year under review, the activity of distribution of Mutual Fund Products (MFP) was carried out across 160 branches covering 24 States.

As on 31st March, 2019, the amount of Assets Under Management outstanding through the Company''s Distribution Services on MFP, aggregate of institutional and retail segment, was Rs. 1,373.48 Crores and the number of clients stood at 57,389.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

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

CORPORATE GOVERNANCE

Your Company practices a culture that is built on core values and ethical governance practices. Your Company is committed to transparency in all its dealings and places high emphasis on business ethics. A Report on Corporate Governance along with a Certificate from Messrs. KSR & Co., Company Secretaries LLP regarding compliance with the conditions of Corporate Governance as stipulated in Regulations 17 to 27, clauses (b) to (i) of sub-regulation (2) of Regulation 46 and paragraphs C, D and E of Schedule V of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, forms part of the Annual Report.

SHARE CAPITAL

The issued, subscribed and paid-up Equity Share Capital as on 31st March, 2019 was Rs. 123.55 Crores, comprising of 61,77,64,960 Equity Shares of the face value of Rs. 2 each, fully paid-up.

There was no change in the Share Capital during the year under review.

The Company has neither issued shares with differential rights as to dividend, voting or otherwise, nor has issued sweat equity, other than Employee Stock Options under the Employees'' Stock Option Scheme referred to in this Report, during the year under review.

As on 31st March, 2019, none of the Directors of the Company holds instruments convertible into Equity Shares of the Company.

STOCK OPTIONS

During the year under review, on the recommendation of the Nomination and Remuneration Committee of your Company, the Trustees of the Mahindra & Mahindra Financial Services Limited Employees'' Stock Option Trust have granted 21,94,249 Stock Options to Eligible Employees under the Mahindra & Mahindra Financial Services Limited Employees'' Stock Option Scheme-2010 ("2010 Scheme”). No new Options were granted under the Mahindra & Mahindra Financial Services Limited Employees'' Stock Option Scheme-2005 ("2005 Scheme”). The Company does not have any scheme to fund its employees to purchase the shares of the Company. No employee has been issued stock options during the year, equal to or exceeding 1% of the issued capital of the Company at the time of grant.

During the year, the Nomination and Remuneration Committee has inter alia, approved the transfer of 7,85,275 Stock Options, being the balance number of Options available in the 2005 Scheme to the 2010 Scheme.

Pursuant to the aforesaid transfer of 7,85,275 Options to the 2010 Scheme on 14th March, 2019, the 2005 Scheme stands closed, effective from the date of the said transfer.

The 2010 Scheme of the Company is in compliance with the Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014 ("SBEB Regulations”) and there were no material changes made to the said Scheme. A Certificate from Messrs. B S R & Co. LLP, Chartered Accountants, Statutory Auditors of the Company, pursuant to Regulation 13 of the SBEB Regulations would be placed at the Annual General Meeting for inspection by Members.

Voting rights on the Shares issued to employees under the aforesaid Scheme are either exercised by them directly or through their appointed proxy.

The details of the Employees'' Stock Options and the Company''s Employees'' Stock Option Trust as required under the SBEB Regulations read with SEBI Circular CIR/CFD/ POLICY CELL/2/2015 dated 16th June, 2015 have been uploaded on the Company''s website and can be accessed at the web-link: https://www. mahindrafinance.com/annual-reports.aspx.

ECONOMY

Global

After strong growth in 2017 and early 2018, global economic activity slowed notably in the second half of last year, reflecting a confluence of factors affecting major economies. From an accelerating economic activity almost across the world with projected growth in 2019 being at 3.9 percent, a lot have changed in the last year. China''s growth declined following a combination of needed regulatory tightening to rein in shadow banking and an increase in trade tensions with the United States. The euro area economy lost more momentum than expected as consumer and business confidence weakened and car production in Germany was disrupted by the introduction of new emission standards; investment dropped in Italy as sovereign spreads widened; and external demand, especially from emerging Asia, softened. Elsewhere, natural disasters hurt activity in Japan.

Trade tensions increasingly took a toll on business confidence and, so, financial market sentiment worsened, with financial conditions tightening for vulnerable emerging markets and advanced economies, weighing on global demand. Conditions have eased in 2019 as the US Federal Reserve signaled a more accommodative monetary policy stance and markets became more optimistic about a US-China trade deal, but they remain slightly more restrictive than in the fall.

Outlook

As a result of these developments, global growth is now projected to slow from 3.6 percent in 2018 to 3.3 percent in 2019, before returning to 3.6 percent in 2020. The projected pickup in the second half of 2019 is predicated on an ongoing buildup of policy stimulus in China, recent improvements in global financial market sentiment, the waning of some temporary drags on growth in the euro area, and a gradual stabilization of conditions in stressed emerging market economies.

While global growth could surprise favorably if trade differences are resolved quickly so that business confidence rebounds and investor sentiment strengthens further, the balance of risks to the outlook remains on the downside. A further escalation of trade tensions and the associated increases in policy uncertainty could further weaken growth. Across all economies, the imperative is to take actions that boost potential output, improve inclusiveness, and strengthen resilience.

Domestic

After averaging close to 8 per cent through Q3:2017-18 to Q1:2018-19, domestic economic activity lost speed. Domestic economic activity lost pace in Q2 and Q3:FY2019, with coincident indicators suggesting a sharper deceleration in Q4. Aggregate demand weakened in Q2 by a large drag from net exports, which became entrenched in Q3 due to deceleration in public spending and private consumption.

Headline CPI inflation has declined sharply since mid- 2018, driven by the sustained fall in food inflation (even turning into deflation during October 2018-February 2019), the waning away of the direct impact of house rent allowances for central government employees, and more recently, by a sharp fall in fuel inflation.

During the end of second quarter, amid certain defaults in the NBFC sector, a credit freeze was witnessed in the bond market especially for NBFCs. The spread of 5-year AAA corporate bond yield over 5-year G-sec yield went up, further the spread for NBFCs/HFCs were even higher with availability of liquidity being limited. For NBFCs and HFCs combined, the share of participation in the issuance of Commercial Paper reduced from upwards of one-half to closer to one-third of the total issuances reflecting increased credit risk premia in the aftermath of the defaults.

Outlook

Looking ahead, favorable factors such as an increase in financial flows to the commercial sector, stabilization of crude oil and other commodity prices, consumption and investment enhancing proposals in the Union Budget 2019-20, and, the expectation of a normal monsoon are expected to boost economic activity. However, there could be headwinds from greater than expected moderation in global growth and global trade as well as unanticipated volatility in global financial markets.

GDP growth is projected to improve from 7.0 per cent in 2018-19 to 7.2 per cent in 2019-20. There are upside as well as downside risks to the baseline growth scenario. The boost to private investment activity from faster resolution of stressed assets and increased as well as more broad-based credit off take amidst rising capacity utilization can raise the baseline growth projection. Conversely, further escalation of trade tensions and protectionist trends, increased volatility in global financial conditions over the uncertainty of the stance of monetary policy in the US and other advanced economies, uncertainty surrounding Brexit, a sharper slowdown in the Chinese economy and deviations of the south-west monsoon from the baseline assumption of a normal monsoon may pose downside risks to the baseline growth path.

Source: International Monetary Fund (IMF), RBI Finance

The NBFC sector experienced liquidity problems in the second half of the financial year 2018-19. The funding squeeze has contributed to higher funding costs and a slowdown in loan growth for non-banking financial companies. 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 under review, the Reserve Bank of India ("RBI”) held six Bi-monthly Monetary Policy Committee ("MPC”) meetings. The Policy Repo rates under the Liquidity Adjustment Facility ("LAF”) was at 6.00% at the beginning of the year. The MPC took the decision to increase the Policy Repo Rate under the LAF by 25 basis points each in the second and third meetings to 6.50% and maintained it at that level till the fifth meeting. Finally, in the sixth meeting, MPC took the decision to reduce the Policy Repo Rate under the LAF by 25 basis points from 6.50% to 6.25%. The MPC changed its stance from "neutral” to "calibrated tightening” in the fourth policy review and reverted back to "neutral” in the sixth policy review. The market continued to expect further reduction in the policy rate.

At the start of the fiscal year (April 2018), 10-year G-Sec benchmark yields (7.17% Gov Stock 2028), were trading at 7.40% levels which was at similar level by end of March 2019. However, in the wake of rising trade tensions, concerns about a "no deal” Brexit and signs of slowing down of the global economy, financial markets sentiments turned cautious and 10-year G-Sec yield touched a peak of 8.18% (around September 2018). The spread of 5-year AAA corporate bond yield over 5-year G-Sec yield moved up, reflecting increased credit risk premia in the aftermath of certain defaults in the NBFC sector. The defaults also led to a liquidity crisis for several non-banking financial companies. The spread declined consequent to the Reserve Bank''s announcement to inject rupee liquidity through long-term foreign exchange buy/sell swap auction. Divergent movements were observed in various segments of the domestic financial market as they reacted differently to the evolving global and local developments during second half of the Financial Year 2018-19. Lower inflation prints, continuing fall in crude oil prices and buoyed sentiments after the announcement of multiple open market purchases by the RBI, resulted in a decline in yields.

During the last quarter of the year under review, a new 10-year benchmark (7.26% GS 2029 - issued in January 2019) which closed the year at 7.35% was issued. During the year, the INR depreciated by 6.7% from INR 65 to INR 69 per USD with intermittent levels being at INR 74/USD around mid-October. The sudden sharp increase and heightened volatility in the currency resulted in inflows from international market being tightened, resulting in further pressure on the currency, which subsided with the global crude prices subsiding.

With a view to promoting and developing a liquid and dynamic corporate bond market, the Securities and Exchange Board of India ("SEBI”) vide its Circular No. SEBI/HO/DDHS/CIR/P/2018/144 dated 26th November, 2018 has provided a framework comprising detailed guidelines for raising of funds by issuance of debt securities and mandated all "large corporates” to raise at least 25 per cent of their incremental borrowings during a financial year by issuing debt securities from the financial year 201920 onwards.

Your Company has been identified as a "Large Corporate” as per the applicability criteria stipulated in the aforesaid SEBI Circular.

During the year under review, your Company continued with its diverse methods of sourcing funds in addition to regular borrowings like Secured and Unsecured Debentures, Term Loans, Fixed Deposits, Commercial Papers, etc., and maintained prudential Asset/ Liability match throughout the year. Your Company sourced long-term debentures and loans from banks and other institutions at attractive rates. Your Company, for the first time has raised funds through issuance of Market Linked Debentures, External Commercial Borrowings ("ECB”) and internationally rated securitisation transactions.

During the year, your Company has successfully completed 7 (seven) securitisation transactions aggregating to Rs. 4,389.20 crores and raised around US- 200 million through ECB.

- Private Placement Issues of Non-Convertible Debentures

During the year under review, your Company issued Secured/Unsecured Redeemable NonConvertible Debentures including Secured Redeemable Principal Protected Non-Convertible Market Linked Debentures ("NCDs”) aggregating to Rs. 6,800.90 Crores on a private placement basis, in various tranches.

As specified in the respective offer documents, the funds raised from NCDs were utilised for the purpose of financing, repayment of dues of other financial institutions/Banks or for longterm working capital.

- Public Issuance of Non-Convertible Debentures

Your Company continues to broaden the liability mix by bringing in new instruments as well as diversifying the investor base and profile. During the year under review, your Company successfully raised Rs. 2,146.99 Crores through its third public issue of 2,14,69,947 Secured Redeemable Non-Convertible Debentures and Unsecured Subordinated Redeemable Non-Convertible Debentures of face value of Rs. 1,000 each, consisting of 1,81,01,224 Secured Redeemable NonConvertible Debentures and 33,68,723 Unsecured Subordinated Redeemable NonConvertible Debentures ("NCDs”). With this issuance, approximately 8% of your Company''s borrowing is funded through this instrument. The NCDs were allotted on 18th January, 2019 and listed on BSE Limited on 21st January, 2019.

The net proceeds received from the Public Issue were used for the purpose of onward lending, financing, refinancing the existing indebtedness of the Company, long-term working capital requirements, Issue expenses and for general corporate purposes. Details of the Issue and the end use were furnished to the Audit Committee.

The Company has been regular in making payments of principal and interest on the NCDs. There are no NCDs which have not been claimed by investors or not paid by the Company after the date on which the NCDs became due for redemption.

- Rupee Denominated Medium Term Note (MTN)

The Rupee Denominated Medium Term Note (MTN) programme of your Company, is listed on the Singapore Exchange Securities Trading Limited. During the year under review, no securities have been issued by your Company under the programme.

INVESTOR RELATIONS

Your Company has been continuously interacting and endeavours to further improve its engagement with Domestic and International investors/analysts by participating either in-person meetings or through use of technology i.e. conference calls, video-conferencing, Tele-presence meetings. Your Company attended multiple investor meets organised by reputed Global and Domestic Broking Houses during the year, both in India and abroad, to communicate details of its performance, important regulatory and market developments and exchange of information. Quarterly and annual earnings calls are scheduled through structured conference calls to keep various stakeholders informed about the past performance and future outlook of the industry, especially those having a bearing on the Company. These interactions with institutional shareholders, fund managers and analysts are based on generally available information that is accessible to the public on a non-discriminatory basis. Your Company uploads the transcript of the quarterly earnings calls on its website which can be accessed by existing and potential investors and lenders.

Your Company believes in transparent communication and building a relationship of mutual understanding and trust. Your Company further ensures that critical information about the Company is available to all the investors by hosting such information on the Company''s website.

CAPITAL ADEQUACY

As on 31st March, 2019, the Capital to Risk Assets Ratio (CRAR) of your Company was 20.3% which is well above the minimum requirement of 15% CRAR prescribed by the Reserve Bank of India.

CREDIT RATING

The credit rating details of the Company as on 31st March, 2019 were as follows:

Rating Agency

Type of Instrument

Rating*

Remarks

India Ratings & Research Private Limited

Commercial Paper Programme and Bank Facilities (Fund/NonFund Based Working Capital Limit)

''IND A1 ''

The ''A1'' rating indicates the Highest Level of Rating. Instruments with this rating are considered to have very strong degree of safety regarding timely payment of financial obligations. Such instruments carry lowest credit risk.

Long-term Debt instruments, Subordinated Debt Programme and Bank Facilities (Fund/NonFund Based Working Capital Limit)

''IND AAA/Stable''

''IND PP-MLD AAA emr/Stable''

The ''AAA'' ratings denote the highest degree of safety regarding timely servicing of financial obligations. Such instruments carry lowest credit risk.

''PP-MLD'' indicates the full principal protection in the equity-linked notes wherein the issuer is obligated to pay the full principal upon maturity.

Suffix “eirr” denotes the exclusion of the embedded market risk from the rating.

CARE Ratings Limited (Formerly known as Credit Analysis & Research Limited)

Long-term Debt instruments and Subordinated Debt Programme

''CARE AAA/Stable''

Brickwork Ratings India Private Limited

Long-term Subordinated Debt Programme

''BWR AAA/Stable''

CRISIL Limited

Fixed Deposit Programme

''CRISIL FAAA/Stable''

Long-term Debt Instruments, Subordinated Debt Programme and Bank Loan Facilities

''CRISIL AA /Stable''

The ''AA '' rating indicates a high degree of safety with regard to timely payment of financial obligations. Such instruments carry very low credit risk.

Commercial Paper Programme and Bank Loan Facilities

''CRISIL A1 ''

The ''A1'' rating indicates the Highest Level of Rating. Instruments with this rating are considered to have very strong degree of safety regarding timely payment of financial obligations. Such instruments carry lowest credit risk.

* The ratings mentioned above were reaffirmed by the Rating Agencies during the Financial Year 2018-19. With the above rating affirmations, your Company continues to enjoy the highest level of rating from all major rating agencies at the same time.

Out of the above, Tier I capital adequacy ratio stood at 15.5% and Tier II capital adequacy ratio stood at 4.8%, respectively.

RBI GUIDELINES

The Company continues to comply with all the applicable regulations prescribed by the Reserve Bank of India ("RBI”), from time to time.

ACHIEVEMENTS

Your Company won several awards and accolades during the year under review. Select few awards/ recognition are enumerated hereunder:

Corporate Governance

- Listed amongst the Top 10 Companies of the ''S&P BSE 100 Companies'' with a ''High Corporate Governance Score'' for the second time in a row, in a study jointly conducted by International Finance Corporation (IFC), a member of the World Bank Group, BSE Limited (BSE) and Institutional Investor Advisory Services (IiAS), based on G20/OECD Principles of Corporate Governance.

Business & Marketing:

- Adjudged the Gold Award Winner as the "Retail NBFC of the Year 2018” by Outlook Money Awards 2018.

- Won two prestigious Awards at the "Rural Marketing Forum and Awards 2019” in the following categories:

a. Most Effective use of Direct Marketing to Rural Consumers for "2 Wheeler to 20 Wheeler Maha Loan Mela”.

b. Best Integrated Rural Marketing Campaign for "Vehicle Loan Festival”.

- Won the Silver Award for MF SUTRADHAAR program and Bronze Award for Suvidha Loans at Flame Awards Asia 2018.

- Won the PRCI (Public Relations Council of India) Collateral Awards 2019 in the following categories:

i) Crystal Award for Table Calendar-2019

ii) Gold Award for Annual Report design

iii) Advertisement Campaign on Vehicle Loan Festival

CSR & Sustainability

- Conferred with the coveted Golden Peacock Award for Corporate Social Responsibility-2018 by the Institute of Directors.

- Listed in Dow Jones Sustainability Index (DJSI) Emerging Markets category for the 6th consecutive year.

- Honoured with ET NOW CSR Leadership Award 2018 for Best CSR Practices and Skill development.

- Included in the "Sustainability Yearbook 2019” released by RobecoSAM.

- Won the Gold Award for Women and Child Health initiative at the CSR Health Impact Awards 2018.

Human Resources

- Listed by Great Place to Work® Institute India in the Top 100 list of Great Places to work in India for 3 years in a row.

- Ranked 11th amongst "25 Best Large Workplaces in Asia 2019”, by Great Place to Work® Institute.

- Won three awards from Great Place to Work® Institute India:

a. Ranked 14th in India''s Best Companies to Work for 2018.

b. Special Category Award in Career Management.

c. Ranked among India''s 15 Best Workplaces in BFSI-2018.

- Listed in Top 100 Best Companies for Women - 2018 by Working Mother and Avtar.

- Won two awards at the TISS Leapvault CLO Summit 2018 in the following categories:

a. Gold Award for the Best Coaching/ Mentoring intervention for "GURU-Mentoring Program”.

b. Silver Award for Best Mobile Learning Intervention for "Manthan - Training Module”.

- Bagged four awards at the Mega Corporate Film Festival Seminar & Awards 2018 in the following categories:

a. First Prize in the Best Corporate Film - "Communicating Employee Engagement-2018”.

b. Second Runners-up in the Best Corporate Film "Communicating Vision, Values, Mission, Purpose - 2018”.

c. Second Runners-up in the Best Corporate Film for "Communicating Organizational Culture - 2018”.

d. Third Runners-up in "Communicating Commitment to Woman Empowerment -2018”.

Information & Technology

- The Project, Voice Induced Business Enablement has won the "Flame Awards - Asia” (Gold category) for the Best Small Budget Campaign of the Year.

FIXED DEPOSITS AND LOANS/ADVANCES

Your Company provides a wide range of Fixed Deposit schemes that cater to the investment needs of various classes of investors. These Deposits carry attractive interest rates with superior service enabled by robust processes and technology. In order to tap rural and semi-urban savings and reach out to the farthest customers, your Company continues to expand its network and make its presence felt in the most remote regions of the country.

During the year, CRISIL has reaffirmed a rating of ''CRISIL FAAA/Stable'' for your Company''s Fixed Deposits. This rating represents the highest degree of safety regarding timely servicing of financial obligations and carries the lowest credit risk. Your Company''s Deposits continue to be a preferred investment amongst the investors.

As on 31st March, 2019, your Company has mobilized funds from Fixed Deposits to the tune of Rs. 5,698.88 Crores, with an investor base of over 1,86,359 investors.

Your Company continues to serve the investors by introducing several customer centric measures on an ongoing basis to further strengthen its processes in sync with the requirements of the Fixed Deposit holders. The Company communicates various intimations via SMS, e-mails, post, etc., to its investors as well as sends reminder emails to clients whose TDS is likely to be deducted before any payout/ accrual. Your Company also provides online renewal facility, online generation of TDS certificates from customer/broker portal and Seamless Investment process for employees.

During the year under review, your Company has rolled out several initiatives aimed at offering a superior customer experience. Some key ones are:

- Initiation of online acceptance of Deposits through the Company''s website;

- Introduction of Dhan Samruddhi Deposits which are available through Digital Channel Partners;

- Introduction of Bulk Deposits above Rs. 5 Crores.

As at 31st March, 2019, 6,152 Deposits amounting to Rs.7.22 Crores had matured for payment and remained unclaimed. The unclaimed Deposits have since reduced to 5,421 Deposits amounting to Rs.

6.02 Crores. There has been no default in repayment of Deposits or payment of interest during the year.

Your Company being a Non-Banking Financial Company, the disclosures required as per Rule 8 (5) (v) and (vi) of the Companies (Accounts) Rules, 2014 read with Sections 73 and 74 of the Companies Act, 2013, are not applicable to it.

The information pursuant to Clause 35(1) of Master Direction DNBR.PD.002/03.10.119/2016-17 dated 25th August, 2016 issued by the Reserve Bank of India on Non-Banking Financial Companies Acceptance of Public Deposits (Reserve Bank) Directions, 2016, regarding unpaid/unclaimed public deposits as on 31st March, 2019, is furnished below:

i. total number of accounts of Public Deposits of the Company which have not been claimed by the depositors or not paid by the Company after the date on which the deposit became due for repayment: 6,152.

ii. the total amounts due under such accounts remaining unclaimed or unpaid beyond the dates referred to in clause (i) as aforesaid: Rs. 7,22,20,437.

Depositors were intimated regarding the maturity of deposits with a request to either renew or claim their Deposits. Your Company continues to send intimation letters via registered post every 3 months to all those Fixed Deposit holders whose Deposits have matured as well as to those whose Deposits remain unclaimed. Where the Deposit remains unclaimed, follow-up action is also initiated through the concerned agent or branch.

Pursuant to Section 125(2) (i) of the Companies Act, 2013 read with the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 ("the IEPF Rules”) as amended from time to time, matured Deposits remaining unclaimed for a period of seven years from the date they became due for payment are required to be transferred to the Investor Education and Protection Fund (IEPF) Authority established by the Central Government. Further, interest accrued on the matured deposits which remain unclaimed for a period of seven years from the date of payment will also be transferred to the IEPF under Section 125(2] (k). The concerned depositor can claim the Deposit and/or interest from the IEPF Authority by following the procedure laid down in the IEPF Rules.

During the year under review, an amount of Rs. 0.09 Crores has been transferred to the IEPF Authority.

During the year under review, the Company has not given any loans and advances in the nature of loans to its subsidiaries or associate or loans and advances in the nature of loans to firms/companies in which Directors are interested.

Accordingly, the disclosure of particulars of loans/ advances, etc., as required to be furnished in the Annual Accounts of the Company pursuant to Regulations 34(3) and 53(f) read with paragraph A of Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is not applicable to the Company.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS IN SECURITIES

Pursuant to Section 186(11) of the Companies Act, 2013 ("the Act”), the provisions of Section 186(4) of the Act requiring disclosure in the Financial Statements of the full particulars of the loans made and guarantees given or securities provided by a Non Banking Financial Company in the ordinary course of its business and the purpose for which the loan or guarantee or security is proposed to be utilized by the recipient of the loan or guarantee or security are exempted from disclosure in the Annual Report.

Further, pursuant to the provisions of Section 186 (4) of the Act, the details of investments made by the Company are given in the Notes to the Financial Statements.

SUSTAINABILITY INITIATIVES

Sustainability has invariably been a core to the purpose of Mahindra Finance. At the heart of our organizational strategy is an inclusive business model that enables the residents of semi-urban and rural India to access formal channels of credit/finance which helps them in creating long-term value. In our journey spanning more than two decades, we have empowered the lives of millions of Indians by providing access to myriad financial services and products, which have helped them to "Rise for Good”. Your Company has been enabling them to meet their aspirations through financial product offerings. Your Company helps the people build their homes through affordable home loan services provided by Mahindra Rural Housing Finance Limited, secure their life and assets by insurance solutions of Mahindra Insurance Brokers Limited and offers investment options by Mahindra Asset Management Company Private Limited. By providing the right set of opportunities in the remote areas and enabling our customers to advance in their lives, we are making positive contribution to multiple stakeholders. Your Company lays strong emphasis on customer centricity with its customer base spread across more than 3.5 lakh villages in India with majority of them belonging to the ''Earn and Pay'' segment.

Your Company commenced its journey towards reporting sustainability performance in 2008-09 through Mahindra Group''s Sustainability Report and in the year 2012-13 your Company released its first standalone Sustainability Report. In the reporting year, the Company released its Sixth Sustainability Report for the Financial Year 2017-18 with the theme "I Am Responsible” based on Integrated Reporting framework and adhering to the Global Reporting Initiative''s (GRI Standards). The Report embodies a motto that each individual of the organization firmly believes in ''Making Sustainability Personal'' under the theme "I Am Responsible”. It also showcases how your Company responsibly creates value for all its stakeholders.

This Report is hosted on your Company''s website at the web-link: https://www.mahindrafinance.com/ sustainability.aspx.

Your Company continued to focus on sustainability awareness for different stakeholders and took various initiatives to engage them on these fronts. In 2018, your Company became the 1st Financial Company in India to be committed towards call to action for Science Based Targets. The Science Based Targets initiative (SBTi) requires companies to publicly commit to setting carbon emission reduction targets that are in line with climate science.

Your Company has been listed on the Dow Jones Sustainability Index (DJSI) Emerging Market Trends for the sixth consecutive year. Your Company is the only Company from amongst the Diversified Financial Services Companies in India to have made it to this list. To be included in the DJSI, companies are assessed and selected based on their long term Environmental, Social and Governance (ESG) management plans and actions. Your Company got selected in "The Sustainability Yearbook 2019” being the only Financial Services Sector Company to qualify amongst 9 companies from India. This signifies your Company being amongst top Sustainability performers in Diversified Financial Services Sector across the World based on Corporate Sustainability Assessment done by Robeco SAM.

Your Company''s approach has been to make its environmental disclosure transparent, and accordingly, it has been reporting disclosures and reports on its performance through the Carbon Disclosure Project (CDP) India since Financial Year 2011-12. During the reporting year, your Company attained CDP Performance Band - C meaning that your Company is at "Awareness” band.

During the year, your Company made proactive efforts to reduce CO2 emissions (carbon footprint) through Project "Mahindra Hariyali”, by planting more than 71,000 saplings throughout the country. The Company''s Annual Family Fun Day "Vrindavan” attained Yale''s Gold Level Green Event Certification as 87% waste generated at Vrindavan was recycled, composted and sent to biogas plants.

Your Company is gearing up to be future ready by making sustainability and climate change an integral part of its risk framework and taking measures to mitigate and manage them. Weather reports are assessed on a regular basis and aligned with business operations to protect the customers and minimize the risk impact. The outlook for the future has been positive and your Company is well equipped to enable its customers and communities to progress through its inclusive and sustainable business model.

BUSINESS RESPONSIBILITY REPORT

The Business Responsibility Report ("BRR”) of your Company for the year 2018-19 forms part of this Annual Report as required under Regulation 34(2) (f) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 and is appended as “Annexure II”.

Your Company is building an inclusive organization by empowering all the stakeholders and facilitating their contribution towards growth that is both holistic and long term. Through the inclusive business model, your Company is endeavoring to cater to the bottom of the pyramid in the rural and semi-urban areas, enabling them to earn their livelihood through varied financial products and services. Your Company has always been conscious of its role as a responsible corporate citizen. Through its wide network of branches with locally-recruited employees, strong and lasting relationships with its stakeholders, large customer base, vast experience and market knowledge, your Company is providing financial resources to underserviced regions of the country.

The BRR can also be accessed on the Company''s website at the web-link: https://www.mahindrafinance.com/ sustainability.aspx.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

Transforming lives of the rural population has been the primary focus of all CSR initiatives undertaken by your Company. The endeavour is to empower the rural communities and help them unleash their potential. Your Company has identified Healthcare, Education (including Livelihood) and Environment as key CSR thrust areas for the welfare of one of the major stakeholders - rural communities in India.

Building on the momentum created last year through several education and livelihood projects, your Company continued to provide scholarships to 2,500 undergraduate and 500 graduate students, organised visits to municipal schools and financial support to run a vocational skill building center catering to 500 People with Disability. In an effort to encourage more women to take up livelihood opportunities, your Company also implemented Drivers Training Program for 375 women and an Auto-mechanic Training Program for 180 women. Further, your Company is empowering youth, women and working population with the knowledge of sound financial practices to enable them in managing their money better by conducting a Financial Literacy workshop. Reaffirming its commitment to the cause of education, your Company continued its support to over 10,450 underprivileged girl children from socially and economically marginalised families living in urban, rural and tribal areas of India. To promote inclusive growth of socially and economically disadvantaged youth, your Company continued its support to Mahindra Pride School which skilled 3,453 youth and all of them have been absorbed in various organisations. Further, an additional 39,783 students were trained through 866 batches of Mahindra Pride Classrooms conducted through Polytechnics and Arts & Science Colleges in 14 States.

In the area of healthcare, your Company organized nationwide blood donation drives, health checkup camps, Swachh Bharat activities, donated 14 ambulances that have made access to primary healthcare centers easy, for several tribal and rural patients across the nation. Your Company has revamped the Medical Equipment Donation project to provide financial support for procuring crucial equipment used in liver transplants and dialysis for kidney patients. Additionally, your Company continued its support for Maternal & Child Health Care project which provides nutritional supplementation to anemic pregnant and lactating women, adolescents and malnourished children in rural areas.

For increasing focus on better environment, your Company helped build a greener tomorrow by planting over 72,500 trees with a higher survival rate.

Apart from the key thrust areas, your Company contributed funds for other causes such as preservation and promotion of the fine arts & culture and conducted visits to orphanage homes, differently abled homes, homes for the elderly, etc., to re-affirm its pledge to the society.

During the year under review, your Company has spent Rs. 26.87 Crores on CSR projects/programs. 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. 26.81 Crores. Your Company is in compliance with the statutory requirements in this regard.

CSR COMMITTEE

During the year under review, the CSR Committee comprised of Mr. Piyush Mankad (Chairman), Mr. Ramesh Iyer, Mr. V. Ravi and Dr. Anish Shah. The Committee, inter alia, reviews and monitors the CSR activities.

Consequent upon the resignation of Mr. Piyush Mankad, as an Independent Director with effect from the close of business hours on 31st March, 2019, the Committee was reconstituted effective from 9th April, 2019 as follows:

Name

Category

Mr. Dhananjay Mungale

- Chairman of the Committee (Independent Director)

Ms. Rama Bijapurkar

- Independent Director

Mr. Ramesh Iyer

- Vice-Chairman & Managing Director

Mr. V. Ravi

- Executive Director & Chief Financial Officer

Dr. Anish Shah

- Non-Executive Non Independent Director

CSR POLICY

The CSR Policy of the Company duly amended, is hosted on the Company''s website at the web-link: https://www.mahindrafinance.com/csr.aspx and a

brief outline of the CSR Policy and the CSR initiatives undertaken by the Company during the year as per Annexure prescribed in the Companies (Corporate Social Responsibility Policy) Rules, 2014 have been appended as “Annexure III” to this Report.

EXTRACT OF ANNUAL RETURN

Pursuant to sub-section 3(a) of Section 134 and subsection (3) of Section 92 of the Companies Act, 2013, read with Rule 12(1) of the Companies (Management and Administration) Rules, 2014, an extract of the Annual Return as at 31st March, 2019 in Form No. MGT-9, is appended as “Annexure IV” and forms part of this Report.

The Annual Return of the Company as at 31st March, 2019 has been placed on the website of the Company and can be accessed at https://www. mahindrafinance.com/annual-reports.aspx.

BOARD MEETINGS AND ANNUAL GENERAL MEETING

The calendar of the Board/Committee Meetings and the Annual General Meeting is circulated to the Directors in advance to enable them to plan their schedule for effective participation at the respective meetings. Additional Board Meetings are convened by giving appropriate notice to address business exigencies. At times certain decisions are taken by the Board/Committee through circular resolutions.

All the decisions and urgent matters approved by way of circular resolutions are placed and noted at the subsequent Board/Committee Meeting.

The Board of Directors met six times during the year under review, on 25th April, 2018, 27th July, 2018, 24th October. 2018, 25th January. 2019, 7th March, 2019 and 27th March, 2019. The requisite quorum was present for all the Meetings. The maximum time gap between any two Meetings was not more than one hundred and twenty days. These Meetings were well attended. The 28th Annual General Meeting (AGM) of the Company was held on 27th July, 2018.

Detailed information on the Meetings of the Board, its Committees and the AGM is included in the Report on Corporate Governance, which forms part of this Annual Report.

MEETINGS OF INDEPENDENT DIRECTORS

The Independent Directors met twice during the year under review, on 24th October, 2018 and 6th March, 2019. The Meetings were conducted in an informal manner without the presence of the Wholetime Directors, the Non-Executive Non-Independent Directors, or any other Management Personnel.

COMMITTEES OF THE BOARD OF DIRECTORS

The Company has various Committees which have been constituted as a part of good corporate governance practices and the same are in compliance with the requirements of the relevant provisions of applicable laws and statutes.

During the year under review, the Audit Committee comprised of Mr. C. B. Bhave as the Chairman and Mr. Dhananjay Mungale, Mr. M. G. Bhide, Ms. Rama Bijapurkar, Mr. Piyush Mankad, Mr. V. S. Parthasarathy and Dr. Anish Shah as Members.

Consequent upon the resignation of Mr. M. G. Bhide and Mr. Piyush Mankad, Independent Directors from the Board of Directors with effect from the close of business hours on 31st March, 2019, and the appointment of Mr. Milind Sarwate as an Independent Director of the Company with effect from 1st April, 2019, the Committee stands reconstituted effective from 9th April, 2019 as follows:

Name

Category

Mr. C. B. Bhave

- Chairman of the Committee (Independent Director)

Mr. Dhananjay Mungale

- Independent Director

Ms. Rama Bijapurkar

- Independent Director

Mr. V. S. Parthasarathy

- Non-Executive Non Independent Director

Dr. Anish Shah

- Non-Executive Non Independent Director

Mr. Milind Sarwate

- Independent Director

The recommendations of the Audit Committee were duly approved and accepted by the Board during the year under review.

The other Committees of the Board are:

i) Nomination and Remuneration Committee

ii) Stakeholders Relationship Committee

iii) Corporate Social Responsibility Committee

iv) Risk Management Committee

v) Asset Liability Committee

vi) Committee for Strategic Investments

vii) IT Strategy Committee

The details with respect to the composition, powers, roles, terms of reference, Meetings held and attendance of the Directors at such Meetings of the relevant Committees are given in detail in the Report on Corporate Governance of the Company which forms part of this Annual Report.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

Directors

Mr. M. G. Bhide and Mr. Piyush Mankad were appointed as Independent Directors by the Members at the 24th Annual General Meeting held on 24th July, 2014 for a term of 5 (five) consecutive years commencing from 24th July, 2014 to 23rd July, 2019, not liable to retire by rotation.

Pursuant to the applicability of Regulation 17(1A) of the Listing Regulations, as amended by the SEBI (Listing Obligations and Disclosure Requirements) (Amendment) Regulations, 2018, mandating approval of Members by a special resolution for the appointment/continuance of Non-Executive Director(s) above the age of 75 years, effective from 1st April, 2019, Mr. M. G. Bhide and Mr. Piyush Mankad, who have attained the age of 75 years, tendered their resignation as Independent Directors from the Board of Directors of the Company with effect from the close of business hours on 31st March, 2019.

The Board places on record its sincere appreciation for the invaluable contribution and guidance provided by Mr. M. G. Bhide and Mr. Piyush Mankad during their tenure as Independent Directors of the Company.

The Board of Directors, based on the recommendation of the Nomination and Remuneration Committee, vide its Circular Resolution dated 25th February, 2019 proposed the appointment of Mr. Milind Sarwate as an Independent Director of the Company to hold office for a term of 5 (five) consecutive years commencing from 1st April, 2019 to 31st March, 2024, not liable to retire by rotation, subject to the approval of the Shareholders.

Subsequent to the above, the Shareholders of the Company have pursuant to the provisions of Sections 149, 150, 152 read with Schedule IV and all other applicable provisions of the Companies Act, 2013 and the Companies (Appointment and Qualification of Directors) Rules, 2014, approved the appointment of Mr. Milind Sarwate as an Independent Director of the Company with effect from 1st April, 2019 for a term of 5 (five) consecutive years, vide an Ordinary Resolution passed by means of a Postal Ballot on 31st March, 2019.

Mr. V. Ravi, Executive Director & Chief Financial Officer, retires by rotation at the forthcoming Annual General Meeting and, being eligible, offers himself for reappointment.

The Nomination and Remuneration Committee, on the basis of performance evaluation of Independent Directors and taking into account the business knowledge, experience and the substantial contribution made by Mr. Dhananjay Mungale and Ms. Rama Bijapurkar during their tenure, has recommended to the Board that the continued association of Mr. Dhananjay Mungale and Ms. Rama Bijapurkar as Independent Directors of the Company would be beneficial to the Company. Based on the above and the performance evaluation of Independent Directors, the Board recommends the re-appointment of Mr. Dhananjay Mungale and Ms. Rama Bijapurkar, as Independent Directors of the Company, not liable to retire by rotation, to hold office for a second term of 5 (five) consecutive years on the Board of the Company, commencing from 24th July, 2019 to 23rd July, 2024 The Company has received the requisite Notices from Members in writing proposing their appointment as Independent Directors.

Mr. Dhananjay Mungale and Ms. Rama Bijapurkar have given their consent for re-appointment and have confirmed that they continue to retain their status as Independent Directors and that they do not suffer from any disqualifications for appointment.

Mr. Dhananjay Mungale, Ms. Rama Bijapurkar and Mr. V. Ravi are not debarred or disqualified from holding the office of Director by virtue of any SEBI Order or any other such authority, pursuant to circulars dated 20th June, 2018 issued by BSE Limited and the National Stock Exchange of India Limited pertaining to enforcement of SEBI Orders regarding appointment of Directors by the listed companies.

All the Directors of the Company have confirmed that they satisfy the "fit and proper” criteria as prescribed in Chapter XI of RBI Master Direction No. DNBR. PD. 008/ 03.10.119/2016-17 dated 1st September, 201 6 and that they are not disqualified from being appointed/continuing as Directors in terms of Section 164(2) of the Companies Act, 2013.

The details of the Directors being re-appointed are set out in the Notice convening the ensuing AGM.

Key Managerial Personnel

Mr. Ramesh Iyer, Vice-Chairman & Managing Director, Mr. V. Ravi, Executive Director & Chief Financial Officer and Ms. Arnavaz M. Pardiwalla, Company Secretary of the Company have been designated as the Key Managerial Personnel of the Company (KMP) pursuant to the provisions of Sections 2(51) and 203 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

There has been no change in the KMP during the year under review.

Declaration by Independent Directors

The Company has received declarations from all the Independent Directors of the Company confirming that they fulfill the criteria of independence as prescribed under sub-section (6) of Section 149 of the Companies Act, 2013 and Regulation 16(1)(b) of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Directors'' Responsibility Statement

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

i. in the preparation of the annual accounts for financial year ended 31st March, 2019, the applicable accounting standards have been followed and there are no material departures in adoption of these standards.

ii. they have in consultation with the Statutory Auditors selected such 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 31st March, 2019 and of the profit of the Company for the year ended on that date.

iii. they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

iv. they have prepared the annual accounts for financial year ended 31st March, 2019 on a going concern basis.

v. they have laid down adequate internal financial controls to be followed by the Company and that such internal financial controls were operating effectively during the financial year ended 31st March, 2019.

vi. they have devised proper systems to ensure compliance with provisions of all applicable laws and that such systems were adequate and operating effectively during the financial year ended 31st March, 2019.

Performance Evaluation of the Board

The Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("the Listing Regulations”) stipulate the evaluation of the performance of the Board, its Committees, Individual Directors and the Chairperson.

The Company has formulated a Policy for performance evaluation of the Independent Directors, the Board, its Committees and other individual Directors which includes criteria for performance evaluation of the Non-Executive Directors and Executive Directors.

The evaluation framework for assessing the performance of Directors comprises of various key areas such as attendance at Board and Committee Meetings, quality of contribution to Board discussions and decisions, strategic insights or inputs regarding future growth of the Company and its performance, ability to challenge views in a constructive manner, knowledge acquired with regard to the Company''s business/ activities, understanding of industry and global trends, etc.

The evaluation involves self-evaluation by the Board Member and subsequent assessment by the Board of Directors. A member of the Board will not participate in the discussion of his/her evaluation.

Pursuant to the provisions of the Companies Act, 2013 and Regulation 17 of 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 the Directors individually (including Independent Directors).

Feedback was sought by way of well-defined and structured questionnaires covering various aspects of the Board''s functioning such as adequacy of the composition of the Board and its Committees, Board culture, areas of responsibility, execution and performance of specific duties, obligations and governance, compliance, oversight of Company''s subsidiaries, etc., and the evaluation was carried out based on responses received from the Directors.

A separate exercise was carried out by the Nomination and Remuneration Committee of the Board to evaluate the performance of individual Directors who were evaluated on several parameters such as level of engagement and contribution, independence of judgment safeguarding the interest of the Company and its minority shareholders and knowledge acquired with regard to the Company''s business/activities.

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 Company was also carried out by the Independent Directors, taking into account the views of the Executive Directors and NonExecutive Directors.

The performance evaluation of the Independent Directors was carried out by the entire Board excluding the Director being evaluated. Qualitative comments and suggestions of Directors were taken into consideration by the Chairman of the Board and the Chairman of the Nomination and Remuneration Committee. The Directors have expressed their satisfaction with the evaluation process.

Familiarisation Programme for Independent Directors

The details of programmes for familiarisation of Independent Directors with the Company, their roles, rights, responsibilities in the Company, nature of the industry in which the Company operates, business model of the Company and related matters along with details of number of programmes and number of hours spent by each of the Independent Directors during the Financial Year 2018-19, in terms of the requirements of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 are available on the website of the Company and can be accessed at the web-link: https:// www.mahindrafinance.com/pdf/Familiarisation Programme for the FY 2018 19.pdf.

Policies on Appointment of Directors and Senior Management and Remuneration of Directors,

Key Managerial Personnel and Employees

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

In accordance with the provisions of Section 134(3)(e) of the Companies Act, 2013 ("the Act”) read with Section 178(2) of the Act and Regulation 17 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, your Company has adopted a Policy on Appointment of Directors and Senior Management and succession planning for orderly succession to the Board and the Senior Management, which inter alia, includes the criteria for determining qualifications, positive attributes and independence of Directors, identification of persons who are qualified to become Directors and who may be appointed in the Senior Management team, succession planning for Directors and Senior Management, and the Talent Management framework of the Company.

During the year under review, the Board based on the recommendations of the Nomination and Remuneration Committee amended the aforesaid Policy to align it in accordance with the provisions of SEBI (Listing Obligations and Disclosure Requirements) (Amendment) Regulations, 2018.

ii) Policy on Remuneration of Directors and the Remuneration Policy for Key Managerial Personnel and Employees of the Company

Your Company has also adopted the Policy on Remuneration of Directors and the Remuneration Policy for Key Managerial Personnel and Employees of the Company in accordance with the provisions of sub-section (4) of Section 178 of the Act.

During the year under review, your Company made changes in these Policies to align them with the amendments made pursuant to the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, respectively.

The Policy on Remuneration of Directors and the Remuneration Policy for Key Managerial Personnel and Employees of the Company, as amended, are appended as “Annexure V-A” and “Annexure V-B”, respectively, and form part of this Report.

The criteria for determining qualifications, positive attributes and independence of a Director and the Remuneration Policies for Directors, Key Managerial Personnel and other employees have been discussed in detail in the Report on Corporate Governance.

AUDITORS

Statutory Auditors

Messrs. B S R & Co. LLP, Chartered Accountants, (ICAI Firm Registration No. 101 248W/W-100022), were appointed as Statutory Auditors of the Company at the Twenty-seventh Annual General Meeting ("AGM”) to hold office for a period of five years, commencing from the conclusion of the 27th AGM held on 24th July, 2017 till the conclusion of the 32nd AGM of the Company to be held in the year 2022, subject to ratification of their appointment by the Members at the AGM, as may be applicable.

Pursuant to the Notification issued by the Ministry of Corporate Affairs on 7th May, 2018 amending Section 139 of the Companies Act, 2013 and the applicable Rules, the mandatory requirement for ratification of appointment of Auditors by the Members at every AGM has been omitted and hence the Company has not proposed ratification of appointment of Messrs. B S R & Co. LLP, Chartered Accountants, at the ensuing AGM.

The Statutory Auditors have given a confirmation to the effect that they are eligible to continue with their appointment and that they have not been disqualified in any manner from continuing as Statutory Auditors. The remuneration payable to the Statutory Auditors shall be determined by the Board of Directors based on the recommendation of the Audit Committee.

The Report given by the Auditors on the Financial Statements of the Company for the Financial Year 2018-19 is a part of the Annual Report. The Report is unmodified and does not contain any qualification, reservation, adverse remark or disclaimer.

The Statutory Auditors were present at the last AGM.

Secretarial Auditor

The Board of Directors of the Company has appointed Messrs. KSR & Co., Company Secretaries LLP to conduct the Secretarial Audit of the Company pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. In accordance with the provisions of sub-section (1) of Section 204, the Secretarial Audit Report for the Financial Year 2018-19 is appended to this Report as “Annexure VI”.

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

Cost Records and Cost Audit

Maintenance of cost records and requirement of cost audit as prescribed under the provisions of Section 148(1) of the Companies Act, 2013 are not applicable in respect of the business activities carried out by the Company.

Reporting of Frauds by Auditors

During the year under review, the Statutory Auditors and the 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, details of which need to be mentioned in this Report.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All contracts/arrangements/transactions entered into by the Company during the Financial Year with related parties were in the ordinary course of business and on an arm''s length basis. During the year under review, your Company had not entered into any contract/ arrangement/transaction with Related Parties which could be considered material in accordance with the Policy on Related Party Transactions. Pursuant to Section 134 (3) (h) read with Rule 8 (2) of the Companies (Accounts) Rules, 2014, there are no transactions to be reported under Section 188 (1) of the Companies Act, 2013. Accordingly, the disclosure of Related Party Transactions, as required under Section 134 (3) (h) of the Companies Act, 2013 in Form AOC-2 is not applicable to the Company.

During the year under review, the Board of Directors based on the recommendations of the Audit Committee amended the Policy on Related Party Transactions in line with the revised Listing Regulations and the same is uploaded on the Company''s website at the web-link: https://www.mahindrafinance.com/policies.aspx.

Further details on the transactions with related parties are provided in the accompanying financial statements.

MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY

No material changes and commitments have occurred after the closure of the Financial Year 2018-19 till the date of this Report, which would affect the financial position of your Company.

RISK MANAGEMENT POLICY

Your Company has a comprehensive Risk Management Policy in place and has laid down a well-defined risk management framework to identify, assess and monitor risks and strengthen controls to mitigate risks. Your Company has established procedures to periodically place before the Risk Management Committee and the Board of Directors, the risk assessment and minimisation procedures being followed by the Company and steps taken by it to mitigate these risks.

During the year under review, the Board based on the recommendations of the Risk Management Committee amended the Risk Management Policy which now specifically covers Cyber Security and related risks, in accordance with the amendments under the Listing Regulations.

The Risk Management Policy, inter alia, includes identification therein of elements of risk, including Cyber Security and related risks as well as those risks which in the opinion of the Board may threaten the existence of the Company. The 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 Company.

The development and implementation of Risk Management Policy adopted by the Company is discussed in detail in the Management Discussion and Analysis chapter, which forms part of this Annual Report.

WHISTLE BLOWER POLICY/VIGIL MECHANISM

The Company promotes ethical behaviour in all its business activities and has established a vigil mechanism for its Directors, Employees and Stakeholders associated with the Company to report their genuine concerns. The Vigil Mechanism as envisaged in the Companies Act, 2013 and the Rules prescribed thereunder and the Listing Regulations is implemented through the Whistle Blower Policy, to provide for adequate safeguards against victimisation of persons who use such mechanism and make provision for direct access to the Chairperson of the Audit Committee.

As per the Whistle Blower Policy implemented by the Company, the Employees, Directors, customers, dealers, vendors, suppliers, or any Stakeholders associated with the Company are free to report illegal or unethical behaviour, actual or suspected fraud or violation of the Company''s Codes of Conduct or Corporate Governance Policies or any improper activity to the Chairman of the Audit Committee of the Company or Chairman of the Company or Convenor of the Corporate Governance Cell.

During the year under review, the Board of Directors based on the recommendation of the Audit Committee has amended the Whistle Blower Policy to inter alia, enable employees to report incidents of leak or suspected leak of unpublished price sensitive information in line with the changes made in the SEBI (Prohibition of Insider Trading) Regulations, 2015.

The Whistle Blower Policy provides for protected disclosure and protection to the Whistle Blower. Under the Whistle Blower Policy, the confidentiality of those reporting violation(s) is protected and they are not subject to any discriminatory practices. Protected disclosures can also be made by sending an email at the designated email id : mmfsl_whistleblower@ mahindra.com.

The Whistle Blower Policy has been appropriately communicated within the Company and is available on the website of your Company at the web-link: https://www.mahindrafinance.com/pdf/MMFSL VigilMechanism.pdf.

No personnel have been denied access to the Audit Committee.

SUBSIDIARY, JOINT VENTURE AND ASSOCIATE COMPANIES

The Company''s subsidiaries and joint venture continue to contribute to the overall growth in revenues and overall performance of your Company.

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

Your Company has formulated a Policy for determining ''Material'' Subsidiaries as defined in Regulation 16 of the Listing Regulations. During the year under review, the Policy was amended in line with the requirements of the SEBI (Listing Obligations and Disclosure Requirements) (Amendment) Regulations, 2018. This Policy has been hosted on the website of the Company and can be accessed through the web-link: https://www.mahindrafinance.com/policies.aspx.

SUBSIDIARIES

Mahindra Insurance Brokers Limited

During the year under review, Mahindra Insurance Brokers Limited (MIBL), the subsidiary in the business of Direct and Re-insurance Broking, serviced approximately 2.27 million insurance cases, with a total of 22,65,146 cases for both Life and Non-Life Retail business. The customized Life insurance cover "Mahindra Loan Suraksha” (MLS) increased from 6,85,264 lives covered with a Sum Assured of Rs. 21,579.3 Crores in the Financial Year 2017-18 to 8,13,742 lives covered with a Sum Assured of Rs. 27,765.0 Crores in the Financial Year 2018-19. A substantial portion of MLS continues to be covered in the rural markets.

MIBL achieved a growth of 11% in Gross Premium facilitated for the Corporate and Retail business lines, increasing from Rs. 2,049.1 Crores in the Financial Year 2017-18 to Rs. 2,267.8 Crores in the Financial Year 2018-19. The Total Income increased by 32% from Rs. 245.1 Crores in the Financial Year 2017-18 to Rs. 323.4 Crores in the Financial Year 2018-19. The Profit before Tax increased by 24% from Rs. 83.2 Crores to Rs. 102.9 Crores crossing a milestone of Rs. 100 Crores, and the Profit after Tax increased by 33% from Rs. 53.6 Crores to Rs. 71.5 Crores during the same period.

MIBL has been able to reach the benefit of insurance to cover 3,00,000 villages across India.

Mahindra Rural Housing Finance Limited

Mahindra Rural Housing Finance Limited (MRHFL), the Company''s subsidiary in the business of providing loans for purchase, renovation, construction of houses to individuals in the rural and semi-urban areas of the country, registered a total income of Rs. 1,383.9 Crores as compared to Rs. 1,034.8 Crores for the previous year, registering a growth of 34%. Profit before tax was 52% higher at Rs. 366.2 Crores as compared to Rs. 241.2 Crores for the previous year. Profit after tax was 44% higher at Rs. 250.5 Crores as compared to Rs. 173.9 Crores for the previous year.

During the year under review, MRHFL disbursed loans aggregating to Rs. 2,581.1 Crores as against Rs. 2,789.2 Crores in the previous year.

MRHFL continued its focus on serving customers in rural India. Majority of the loans disbursed were to customers in villages with an average annual household income of less than Rs. 2 lakhs. During the year under consideration, MRHFL disbursed home loans to around 1,71,000 households (in addition to around 7,79,000 existing households as on 31st March, 2018). MRHFL has been expanding its geographical presence to provide affordable services for rural households.

During the year under review, operations of MRHFL were strengthened in the States of Maharashtra, Gujarat, Rajasthan, Tamil Nadu, Andhra Pradesh, Telangana, Chhattisgarh, Kerala, Karnataka, Madhya Pradesh, Uttar Pradesh, Uttarakhand and Bihar.

Acquisition of Shareholding of National Housing Bank in MRHFL

In March 2019, your Company approved the acquisition of 1,18,91,511 Equity Shares of Rs. 10 each held by National Housing Bank representing 9.68% of the share capital in MRHFL, at a premium of Rs. 231.16 per share, aggregating to Rs. 286.78 Crores.

Post the acquisition subsequent to the year end, the shareholding of your Company in MRHFL stands increased from 88.75% to 98.43% of MRHFL''s share capital.

Mahindra Asset Management Company Private Limited

Mahindra Asset Management Company Private Limited (MAMCPL), a wholly-owned subsidiary of the Company acts as an Investment Manager for the schemes of Mahindra Mutual Fund. As on 31st March, 2019, MAMCPL was acting as the Investment Manager for nine schemes.

The Assets under Management in these nine schemes were Rs. 4,871 Crores in March 2019 as compared to Rs. 3,352 Crores in March 2018. Of these assets, Rs. 1,449 Crores were in equity schemes in March 2019 as compared to Rs. 1,173 Crores in March 2018. MAMCPL has empanelled more than 11,500 distributors and opened 1,59,399 investor accounts in these schemes recording a rise of more than 25%.

During the year under review, the total income of MAMCPL was Rs.28.1 Crores as compared to Rs. 23.5 Crores for the previous year, registering a growth of 19%. The operations for the year have resulted in a loss of Rs.39.5 Crores as against a loss of Rs.37.5 Crores during the previous year.

Mahindra Trustee Company Private Limited

Mahindra Trustee Company Private Limited (MTCPL), your Company''s wholly-owned subsidiary, acts as the Trustee to Mahindra Mutual Fund.

During the year, MTCPL earned trusteeship fees of Rs. 23.50 lakhs and other income of Rs. 1.10 lakhs as compared to Rs.23.87 lakhs and Rs. 0.83 lakhs respectively, for the previous year. The total expenses for the year were Rs. 25.34 lakhs as against Rs. 24.25 lakhs in the previous year. MTCPL recorded a loss of Rs. 0.83 lakhs for the year under review as against a profit of Rs. 0.44 lakhs in the previous year.

JOINT VENTURE Mahindra Finance USA LLC.

The joint venture company''s disbursement registered a decline of 8.8% to USD 755.11 Million for the year ended 31st March, 2019 as compared to USD 828.38 Million for the previous year.

Total Income grew by 20.58% to USD 67.68 Million for the year ended 31st March, 2019 as compared to USD 56.13 Million for the previous year. Profit before tax was 9.98% higher at USD 18.08 Million as compared to USD 16.44 Million for the previous year. Profit after tax grew at a healthy rate of 41.86% to USD 13.76 Million as compared to USD 9.70 Million in the previous year.

Names of companies which have become or ceased to be subsidiaries, joint ventures or associate companies during the year

During the year under review, no company has become or ceased to be a subsidiary, joint venture or associate of your Company.

Subsequent to the year end, Mahindra Finance CSR Foundation, has been incorporated on 2nd April, 2019 as a wholly-owned subsidiary of the Company registered under Section 8 of the Companies Act, 2013, to promote and support CSR projects and activities.

CONSOLIDATED FINANCIAL STATEMENTS

The Consolidated Financial Statements of the Company, its subsidiaries and its associate(s) for the Financial Year 2018-19, prepared in accordance with the relevant provisions of 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 and associate(s).

Pursuant to the provisions of Section 136 of the Companies Act, 2013, the Financial Statements of the Company, Consolidated Financial Statements along with relevant documents and separate annual accounts in respect of the subsidiaries are available on the website of the Company and can be accessed at the web-link: https://www.mahindrafinance.com/annual-reports. aspx.

The annual accounts of the subsidiaries and related detailed information will also be available for inspection at the Registered Office of the Company during working hours upto the date of the Annual General Meeting.

DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND THE COMPANY''S OPERATIONS IN FUTURE There are no significant and material orders passed by the regulators or courts or tribunals that would impact the going concern status of the Company and its future operations.

DETAILS IN RESPECT OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS

Your Company has in place adequate internal financial controls with reference to financial statements, commensurate with the size, scale, and complexity of its operations. Your Company uses various industry-standard systems to enable, empower and engender businesses and also to maintain its Books of Account. The transactional controls built into these systems ensure appropriate segregation of duties, the appropriate level of approval mechanisms and maintenance of supporting records. The systems, Standard Operating Procedures and controls are reviewed by Management. These systems and controls are audited by Internal Audit and their findings and recommendations are reviewed by the Audit Committee and the IT Strategy Committee which ensures the implementation. Review of the internal financial controls environment of the Company was undertaken during the year which covered verification of entity-level control, process level control and IT controls, identification, assessment and definition of key business processes and analysis of risk control matrices, etc. The risk control matrices are reviewed on a yearly basis and control measures are tested and documented on a quarterly basis.

Reasonable Financial Controls are operative for all the business activities of the Company and no reportable material weakness or significant deficiencies in the design or operation of internal financial controls was observed.

Nonetheless your Company recognises that any internal control framework, no matter how well designed, has inherent limitations and accordingly, regular audits and review processes ensure that such systems are reinforced on an ongoing basis.

COMPLIANCE WITH THE PROVISIONS OF SECRETARIAL STANDARD - 1 AND SECRETARIAL STANDARD - 2

The Directors have devised proper systems to ensure compliance with the provisions of all applicable Secretarial Standards issued by the Institute of Company Secretaries of India and that such systems are adequate and operating effectively.

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.

PARTICULARS OF REMUNERATION AND RELATED DISCLOSURES

Disclosures with respect to the remuneration of Directors, Key Managerial Personnel and Employees as required under Section 197(12) of the Companies Act, 2013 and Rule 5(1) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, are as under:

Sr.

Disclosure Requirement

Disclosure Details

No.

Name of Director/ KMP

Designation

Ratio of the remuneration of each Director to median remuneration of employees

1.

Ratio of the remuneration of each Director to the median remuneration

Mr. Dhananjay Mungale

Chairman

(Independent Director)

11.23X

of the employees of the Company for the Financial Year 2018-19.

Mr M. G. Bhide**

Independent Director

9.42X

Mr. Piyush Mankad **

Independent Director

9.05X

Mr. C. B. Bhave

Independent Director

8.89X

Ms. Rama Bijapurkar

Independent Director

8.06X

Mr. V. S. Parthasarathy

Non-Executive Director

NIL*

Dr. Anish Shah

Non-Executive Director

NIL*

Mr. Ramesh Iyer

Vice-Chairman & Managing Director

220.22X

Mr. V. Ravi

Executive Director & Chief Financial Officer

86.70X

Ms. Arnavaz M. Pardiwalla

Company Secretary & Compliance Officer

24.53X

*Mr. V. S. Parthasarathy and Dr. Anish Shah do not receive any remuneration from the Company.

** resigned as Independent Directors of the Company w.e.f. the close of business hours on 31st March, 2019.

Disclosure Details

Sr. No. Disclosure Requirement

Name of Director/KMP

Designation

% increase in Remuneration

2. Percentage increase in Remuneration of each Director, Chief Financial Officer

Mr. Dhananjay Mungale

Chairman

(Independent Director)

8.96

and Company Secretary during the Financial Year 2018 -19.

Mr. M. G. Bhide**

Independent Director

10.47

Mr. Piyush Mankad**

Independent Director

10.53

Mr. C. B. Bhave

Independent Director

12.89

Ms. Rama Bijapurkar

Independent Director

10.08

Mr. V. S. Parthasarathy

Non-Executive Director

NIL*

Dr. Anish Shah

Non-Executive Director

NIL*

Mr. Ramesh Iyer

Vice-Chairman & Managing Director

19.93

Mr. V. Ravi

Executive Director & Chief Financial Officer

9.42

Ms. Arnavaz M. Pardiwalla

Company Secretary & Compliance Officer

33.15

* Mr. V. S. Parthasarathy and Dr. Anish Shah do not receive any remuneration from the Company.

** resigned as Independent Directors of the Company w.e.f. the close of business hours on 31st March, 2019.

3.

Percentage increase in the median Remuneration of employees in the Financial Year 2018-19

50.70% considering employees who were in employment for the whole of the Financial Year 2017-18 and Financial Year 2018-19.

4.

Number of Permanent employees on the rolls of the Company as on 31st March, 2019

21,789

5.

Average percentile increase already made in the salaries of employees other than the Managerial Personnel in the last Financial Year i.e. 201 8-1 9 and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration.

For employees other than Managerial Personnel who were in employment for the whole of the Financial Year 201718 and Financial Year 2018-19, the average increase is 51.75%.

Justification: The remuneration of the Vice-Chairman & Managing Director and Executive Director & Chief Financial Officer is decided based on the individual performance, inflation, prevailing industry trends and benchmarks.

The remuneration of eligible Non-Executive Directors consists of commission and sitting fees. While deciding the remuneration, various factors such as Director''s participation in Board and Committee Meetings during the year, other responsibilities undertaken, such as Membership or Chairmanship/ Chairpersonship of Committees, etc., were taken into consideration.

The increment given to each individual employee is based on the employees'' potential, experience as also their performance and contribution to the Company''s progress over a period of time and also benchmarked against a comparator basket of relevant companies in India.

6.

Affirmation that the remuneration is as per the Remuneration Policy of the Company.

The remuneration paid/payable is as per the Policy on Remuneration of Directors and Remuneration Policy for Key Managerial Personnel and Employees of the Company.

Notes:

1) The remuneration calculated is as per Section 2(78) of the Companies Act, 2013 and includes the perquisite value of Stock Options of the Company exercised during the year.

2) The calculations are based on Employees who were on the rolls of the Company for the whole of the Financial Year 2017-18 and Financial Year 2018-19.

Mr. Ramesh Iyer, Vice-Chairman & Managing Director and Mr. V. Ravi, Executive Director & Chief Financial Officer of the Company do not receive any remuneration or commission from its Holding Company. However, Mr. Iyer has been granted stock options under the Employees'' Stock Option Scheme of the Holding Company, Mahindra & Mahindra Limited. Mr. Iyer has not exercised ESOPs of the Holding Company, during the year, which were granted in the earlier year(s).

During the year under review, Mr. Ramesh Iyer and Mr. V. Ravi have not received any remuneration or commission from any of the subsidiaries of the Company.

During the year, 28,568 Stock Options have been exercised by Mr. Ramesh Iyer and 7,142 Stock Options have been exercised by Mr. V. Ravi, under the Employees'' Stock Option Scheme of Mahindra Rural Housing Finance Limited, the Company''s subsidiary company.

The Company had 16 employees who were in receipt of remuneration of not less than Rs. 1,02,00,000 during the year ended 31st March, 2019 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) and 5 (3) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are available at the Registered

Office of the Company during working hours, 21 days before the Annual General Meeting and shall be made available to any shareholder on request. Such details are also available on your Company''s website and can be accessed at the web-link: https://www. mahindrafinance.com/annual-reports.aspx. None of these employees is a relative of any Director of the Company.

None of the employees holds either by himself/herself or along with his/her spouse or dependent children, more than two per cent of the Equity Shares of the Company.

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

Your Company is an equal opportunity employer and is committed to ensuring that the work environment at all its locations is conducive to fair, safe and harmonious relations between employees. It strongly believes in upholding the dignity of all its employees, irrespective of their gender or seniority. Discrimination and harassment of any type are strictly prohibited.

The Company has in place an appropriate Policy in accordance with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, to prevent sexual harassment of its employees.

All employees (permanent, contractual, temporary and trainees) are covered under this Policy. The Policy has been widely communicated internally and is placed on the Company''s intranet portal. The Company ensures that no employee is disadvantaged by way of gender discrimination.

The Company has complied with the provisions relating to the constitution of Internal Complaints Committee (ICC) under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 to redress complaints received regarding sexual harassment.

The following is a summary of Sexual Harassment complaint(s) received and disposed off during the year 2018-19, pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and Rules framed thereunder:

a) Number of complaint(s) of Sexual Harassment received during the year - Nil

b) Number of complaint(s) disposed off during the year - Nil

c) Number of cases pending for more than 90 days -Nil

d) Number of workshops/awareness programmes against sexual harassment carried out - 3 workshops were conducted at the Company''s Corporate Office. Awareness on sexual harassment was carried out to sensitize employees of the Company at branches pan-India.

e) Nature of action taken by the employer or District Officer - Not Applicable.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars in respect of conservation of energy, technology absorption and foreign exchange earnings and outgo, as required under sub-section (3) (m) of Section 134 of the Companies Act, 2013 read with Rule (8)(3) of the Companies (Accounts) Rules, 2014 are given as under :

(A) Conservation of Energy

(i) The steps taken or impact on conservation of energy:

The operations of your Company are not energy intensive. However, adequate measures have been initiated to reduce energy consumption.

Select few steps are listed:

a) Replacement of conventional lighting with Light Emitting Diode (LED) lighting:

The Company has installed LED lighting in Regional Offices of the Company during the year under review and the same has been monitored in terms of electrical consumption and expenses.

b) Replacement of old air-conditioning with updated version of machines with R-410A gas, which helps in reducing Ozone depletion.

c) Reduction in water and energy consumption and recycling of waste generation at various locations.

(ii) The steps taken by the Company for utilising alternate sources of energy: Nil.

(iii) The capital investment on energy conservation equipments: Nil.

(B) Technology Absorption

(i) The efforts made towards technology absorption: Not Applicable.

(ii) The benefits derived like product improvement, cost reduction, product development or import substitution: Not

Applicable.

(iii) In case of imported technology (imported during the last three years reckoned from the beginning of the Financial Year): Not Applicable.

(a) Details of Technology Imported;

(b) Year of Import;

(c) Whether the Technology has been fully absorbed;

(d) if not fully absorbed, areas where absorption has not taken place, and the reasons thereof.

(iv) Your Company has not incurred any expenditure on Research and Development during the year under review.

(C) Foreign Exchange Earnings and Outgo

The information on foreign exchange outgo is furnished in the Notes to the Accounts. There were no foreign exchange earnings during the year.

For and on behalf of the Board

Dhananjay Mungale

Chairman

Place : Mumbai

Date : 24th April, 2019


Mar 31, 2019

Board’s Report

To,

The Members of

Mahindna & Mahindra Financial Services Limited

Your Directors are pleased to present their Twenty-Ninth Report together with the audited financial statements of your Company for the Financial Year ended 31st March, 2019.

The performance highlights and summarized financial results of the Company are given below:

PERFORMANCE HIGHLIGHTS

- Consolidated income for the year increased by 32% to Rs. 10,430.9 Crores as compared to Rs. 7,912.2 Crores in 2017-18;

- Consolidated income from operations for the year was Rs. 10,371.7 Crores as compared to Rs. 7,883.9 Crores in 2017-18, a growth of 32%;

- Consolidated profit before tax for the year was Rs. 2,840.8 Crores as compared to Rs. 1,904.8 Crores in

2017-18;

- Consolidated profit after tax and non-controlling interest for the year was Rs. 1,827.3 Crores as compared to Rs.1,185.2 Crores in 2017-18.

FINANCIAL RESULTS

Rs. in Crores

CONSOLIDATED

STANDALONE

March 2019

March 2018

March 2019

March 2018

Total Income

10,430.9

7,912.2

8,809.8

6,685.2

Less : Finance Costs

4,432.3

3,436.2

3,944.6

3,081.6

Expenditure

3,129.3

2,546.7

2,422.6

1,957.5

Depreciation, Amortization and Impairment

75.5

55.2

60.2

44.2

Total Expenses

7,637.1

6,038.1

6,427.4

5,083.3

Profit Before Exceptional Items and Taxes

2,793.8

1,874.1

2,382.4

1,601.9

Share of profit of associate

47.0

30.7

-

-

Exceptional items

-

-

-

64.9

Profit Before Tax

2,840.8

1,904.8

2,382.4

1,666.8

Less : Provision For Tax

Current Tax

711.4

665.2

576.8

549.5

Deferred Tax

262.1

23.3

248.5

41.2

Profit After Tax for the Year

1,867.3

1,216.3

1,557.1

1,076.1

Less : Non-controlling interests

40.0

31.1

-

-

Profit for the Year attributable to Owners of the Company

1,827.3

1,185.2

1,557.1

1,076.1

Balance of profit for earlier years

3,282.5

2,909.0

3,193.2

2,608.4

Less : Transfer to Debenture Redemption Reserve

146.7

50.5

146.7

50.5

Profit available for Appropriation

4,963.1

4,043.7

4,603.6

3,634.0

Add : Other Comprehensive Income/(Loss)

(9.5)

(13.6)

(8.6)

(12.3)

Less : Dividend paid on Equity Shares

296.6

163.4

293.8

161.0

General Reserve

155.8

88.4

155.8

89.1

Statutory Reserve

385.2

224.3

311.4

178.4

Gross obligation at fair value to acquire non-controlling interest

158.6

316.8

-

-

Transaction with non-controlling interest

-

5.4

-

-

Securities Premium on fresh issue of equity share capital

0.1

-

-

-

Add : Profit on sale of Equity Shares of subsidiaries

-

50.7

-

-

Balance carried forward

3,957.3

3,282.5

3,834.0

3,193.2

IMPLEMENTATION OF INDIAN ACCOUNTING STANDARDS (“IND AS”)

Your Company has prepared the Financial Statements in accordance with Indian Accounting Standards ("IND AS”) notified under the Companies (Indian Accounting Standards) Rules, 2015 as amended by the Companies (Indian Accounting Standards) Rules, 2016. The Company has adopted IND AS from 1st April, 2018 with effective transition date of 1st April, 2017 and accordingly, these Financial Statements together with the Financial Statements for the comparative reporting period have been prepared with the recognition and measurement principles stated therein, prescribed under Section 133 of the Companies Act, 2013 ("the Act”) read with relevant Rules issued there under and the other accounting principles generally accepted in India.

This transition to IND AS has been carried out from the erstwhile Accounting Standards notified under the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014 (as amended), guidelines issued by the Reserve Bank of India ("RBI”) and other generally accepted accounting principles in India (collectively referred to as ''''the previous GAAP”). Accordingly, the impact of transition has been recorded in the opening reserve as at 1st April, 2017 and the corresponding adjustments pertaining to comparative previous year as presented in these Financial Statements have been restated/reclassified in order to conform to current year presentation.

TRANSFER TO RESERVES

The Company proposes to transfer an amount of Rs. 155.8 Crores to the General Reserve, Rs. 311.4 Crores to the Statutory Reserve and Rs. 146.7 Crores to the Debenture Redemption Reserve. An amount of Rs. 3,834.0 Crores is proposed to be retained in the Statement of Profit and Loss.

DIVIDEND

Your Directors are pleased to recommend a dividend of Rs. 4.0 per Equity Share and also a Special Dividend of Rs. 2.5 per Equity Share aggregating Rs.6.5 per Equity Share of the face value of Rs. 2 each payable to those Members whose names appear in the Register of Members as on the Book Closure date. The Special Dividend is being recommended in the light of the very successful completion of twenty-five years of the business operations of the Company.

The dividend including dividend tax for the Financial Year 2018-19 will absorb a sum of Rs. 477.9 Crores [as against Rs. 293.8 Crores on account of dividend of Rs. 4.0 per Equity Share and tax thereon, paid for the previous year].

The dividend pay-out is in accordance with the Dividend Distribution Policy of the Company which has been approved by the Board of Directors.

DIVIDEND DISTRIBUTION POLICY

The Dividend Distribution Policy, containing the requirements prescribed in Regulation 43A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 is appended as “Annexure I” and forms part of this Annual Report.

The Dividend Distribution Policy can also be accessed on the Company''s website at the web-link: https://www.mahindrafinance.com/policies.aspx.

During the year, an amount of Rs. 4,97,120 being the unclaimed/unpaid dividend of the Company for the Financial Year ended 31st March, 2011 was transferred in September, 2018 to the Investor Education and Protection Fund Authority.

OPERATIONS

During the year under review, your Company completed 25 glorious years of its business operations in rural and semi-urban markets. Rural sentiments continued to be positive for the Company from the start of the year till November 2018. During this period both farm and infra cash flows were good enabling higher collection efficiency on a consistent basis despite subdued automobile growth. Elections in few States in November

2018 and the impending Lok Sabha Elections slowed down growth in the last few months of the year. However, even during this slowdown, your Company could maintain the asset growth as well as collections, by continuously engaging with customers.

Your Company further strengthened its position as a significant financier in rural and semi-urban geographies by providing a wide range of products and services. Your Company has retained its leadership position in financing the Mahindra range of vehicles and tractors. Your Company not only retained the status of major financier for Maruti vehicles in semi-urban and rural India but also expanded its coverage to include several leading vehicle dealers. With the Company''s vast semi-urban and rural distribution network, it could attract many OEMs like Hyundai, Renault, Nissan for a tie-up. Your Company consolidated its position as a leading financier in all Aggregator (like Ola and Uber) and Selfdrive vehicles (like Zoom and Revv) segment. In this year, your Company also emerged as a significant player in financing of Heavy, Medium Commercial Vehicles and Construction Equipment for major OEMs. Your Company has also launched pilot projects to understand the upcoming opportunities in Leasing. Your Company maintains a leading presence in the growing market of financing of pre-owned vehicles such as Cars, Utility Vehicles and Tractors.

Network Expansion

Your Company strengthened its pan-India presence with a network of 1,321 offices, which is one of the largest amongst Non-Banking Financial Companies. Your Company further expanded its geographical presence by reaching out to untapped villages and increased its footprint by opening new branches and making it more accessible to its customers. Your Company''s nationwide network of branches and locally recruited employees have facilitated in catering to the diverse financial requirements of its customers by identifying and understanding the needs and aspirations of the people. With its strong presence covering even the most remote areas of the country, your Company is providing flexible financing opportunities to aspiring individuals to realize their dreams and helping them to ''RISE''. Your Company believes that incessantly serving its customers and channel partners and enhancing customer relationship is the starting point of a great successful journey.

Enhanced Product Offerings

Your Company has earned the trust and confidence of its customers with its consistent, transparent and reliable services and as a result, customer satisfaction across its network continues to remain high. Your Company has cumulatively financed the aspirations of over 6 million customers since its inception, most of whom had no prior credit history. Your Company''s philosophy of helping rural customers by providing tailor-made products and services at their doorstep has given a big boost in transforming rural lives. Your Company has also launched Suvidha Loans to meet specific needs of its existing customers through its numerous Branches.

During the year under review, your Company continued to expand its reach in the Micro Small and Medium Enterprises ("MSME”) segment. MSME Assets Under Management crossed more than Rs. 3,655.90 Crores during the period under review, covering 3,719 customers.

A reorganized collection structure has enabled your Company to take advantage of improved rural cash flows from better yields and Minimum Support Price which augmented its overall collections.

Digital

Your Company remains firmly focused on addressing the changing but unique needs of its rural and semi-urban customers. Your Company has successfully implemented low bandwidth end-to-end mobile sales application with real time integrations with government databases and credit bureaus to disburse loans to customers anytime, anywhere. Your Company has also launched multilingual mobile application for its customers to view their current loan details and make payments. It also helps in getting pre-approved Suvidha Loans. The digital strategy of your Company focuses on providing tailor-made solutions to meet its customers'' needs. Your Company and its subsidiaries have embraced digital in performing different activities like customers'' acquisition, selling of Fixed Deposits, Mutual Funds and Insurance products in partnership with Common Service Centers Scheme. Your Company will continue to further its digital presence by extending its coverage to more activities including improving employee efficiency.

Getting Future Ready

In order to provide superior experience to its customers, your Company has entered into a long term partnership with a leading technology service provider. With this state-of-the-art technology, your Company will be in a position to delight its customers.

Building Analytics Capability

Your Company has consistently serviced over 6 million semi-urban and rural customers across 3.6 lakh villages, for the past 25 years. In the process, the Company has acquired a very rich database of these millions of customers which could be productively mined for not only increasing repeat business but also to cross-sell many other financial and insurance products. Towards this purpose, the Company has set up a Data Analytics and Insight Department with experienced data science professionals.

The overall disbursement registered a growth of 22% at Rs. 46,210.3 Crores as compared to Rs. 37,772.9 Crores in the previous year. Total Income grew by 32% at Rs. 8,809.8 Crores for the year ended 31st March, 2019 as compared to Rs. 6,685.2 Crores for the previous year. Profit Before Tax (PBT) grew by 43% at Rs. 2,382.4 Crores as compared to Rs. 1,666.8 Crores for the previous year. Profit After Tax (PAT) increased by 45% at Rs. 1,557.10 Crores as compared to Rs. 1,076.10 Crores in the previous year.

During the year under review, the Assets Under Management stood at Rs. 67,078 Crores as at 31st March, 2019 as against Rs. 52,793 Crores as at 31st March, 2018, a growth of 27%.

There has been no change in the nature of business of the Company during the year under review.

DISTRIBUTION OF MUTUAL FUND PRODUCTS

During the year under review, the activity of distribution of Mutual Fund Products (MFP) was carried out across 160 branches covering 24 States.

As on 31st March, 2019, the amount of Assets Under Management outstanding through the Company''s Distribution Services on MFP, aggregate of institutional and retail segment, was Rs. 1,373.48 Crores and the number of clients stood at 57,389.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

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

CORPORATE GOVERNANCE

Your Company practices a culture that is built on core values and ethical governance practices. Your Company is committed to transparency in all its dealings and places high emphasis on business ethics. A Report on Corporate Governance along with a Certificate from Messrs. KSR & Co., Company Secretaries LLP regarding compliance with the conditions of Corporate Governance as stipulated in Regulations 17 to 27, clauses (b) to (i) of sub-regulation (2) of Regulation 46 and paragraphs C, D and E of Schedule V of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, forms part of the Annual Report.

SHARE CAPITAL

The issued, subscribed and paid-up Equity Share Capital as on 31st March, 2019 was Rs. 123.55 Crores, comprising of 61,77,64,960 Equity Shares of the face value of Rs. 2 each, fully paid-up.

There was no change in the Share Capital during the year under review.

The Company has neither issued shares with differential rights as to dividend, voting or otherwise, nor has issued sweat equity, other than Employee Stock Options under the Employees'' Stock Option Scheme referred to in this Report, during the year under review.

As on 31st March, 2019, none of the Directors of the Company holds instruments convertible into Equity Shares of the Company.

STOCK OPTIONS

During the year under review, on the recommendation of the Nomination and Remuneration Committee of your Company, the Trustees of the Mahindra & Mahindra Financial Services Limited Employees'' Stock Option Trust have granted 21,94,249 Stock Options to Eligible Employees under the Mahindra & Mahindra Financial Services Limited Employees'' Stock Option Scheme-2010 ("2010 Scheme”). No new Options were granted under the Mahindra & Mahindra Financial Services Limited Employees'' Stock Option Scheme-2005 ("2005 Scheme”). The Company does not have any scheme to fund its employees to purchase the shares of the Company. No employee has been issued stock options during the year, equal to or exceeding 1% of the issued capital of the Company at the time of grant.

During the year, the Nomination and Remuneration Committee has inter alia, approved the transfer of 7,85,275 Stock Options, being the balance number of Options available in the 2005 Scheme to the 2010 Scheme.

Pursuant to the aforesaid transfer of 7,85,275 Options to the 2010 Scheme on 14th March, 2019, the 2005 Scheme stands closed, effective from the date of the said transfer.

The 2010 Scheme of the Company is in compliance with the Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014 ("SBEB Regulations”) and there were no material changes made to the said Scheme. A Certificate from Messrs. B S R & Co. LLP, Chartered Accountants, Statutory Auditors of the Company, pursuant to Regulation 13 of the SBEB Regulations would be placed at the Annual General Meeting for inspection by Members.

Voting rights on the Shares issued to employees under the aforesaid Scheme are either exercised by them directly or through their appointed proxy.

The details of the Employees'' Stock Options and the Company''s Employees'' Stock Option Trust as required under the SBEB Regulations read with SEBI Circular CIR/CFD/ POLICY CELL/2/2015 dated 16th June, 2015 have been uploaded on the Company''s website and can be accessed at the web-link: https://www. mahindrafinance.com/annual-reports.aspx.

ECONOMY

Global

After strong growth in 2017 and early 2018, global economic activity slowed notably in the second half of last year, reflecting a confluence of factors affecting major economies. From an accelerating economic activity almost across the world with projected growth in 2019 being at 3.9 percent, a lot have changed in the last year. China''s growth declined following a combination of needed regulatory tightening to rein in shadow banking and an increase in trade tensions with the United States. The euro area economy lost more momentum than expected as consumer and business confidence weakened and car production in Germany was disrupted by the introduction of new emission standards; investment dropped in Italy as sovereign spreads widened; and external demand, especially from emerging Asia, softened. Elsewhere, natural disasters hurt activity in Japan.

Trade tensions increasingly took a toll on business confidence and, so, financial market sentiment worsened, with financial conditions tightening for vulnerable emerging markets and advanced economies, weighing on global demand. Conditions have eased in 2019 as the US Federal Reserve signaled a more accommodative monetary policy stance and markets became more optimistic about a US-China trade deal, but they remain slightly more restrictive than in the fall.

Outlook

As a result of these developments, global growth is now projected to slow from 3.6 percent in 2018 to 3.3 percent in 2019, before returning to 3.6 percent in 2020. The projected pickup in the second half of 2019 is predicated on an ongoing buildup of policy stimulus in China, recent improvements in global financial market sentiment, the waning of some temporary drags on growth in the euro area, and a gradual stabilization of conditions in stressed emerging market economies.

While global growth could surprise favorably if trade differences are resolved quickly so that business confidence rebounds and investor sentiment strengthens further, the balance of risks to the outlook remains on the downside. A further escalation of trade tensions and the associated increases in policy uncertainty could further weaken growth. Across all economies, the imperative is to take actions that boost potential output, improve inclusiveness, and strengthen resilience.

Domestic

After averaging close to 8 per cent through Q3:2017-18 to Q1:2018-19, domestic economic activity lost speed. Domestic economic activity lost pace in Q2 and Q3:FY2019, with coincident indicators suggesting a sharper deceleration in Q4. Aggregate demand weakened in Q2 by a large drag from net exports, which became entrenched in Q3 due to deceleration in public spending and private consumption.

Headline CPI inflation has declined sharply since mid- 2018, driven by the sustained fall in food inflation (even turning into deflation during October 2018-February 2019), the waning away of the direct impact of house rent allowances for central government employees, and more recently, by a sharp fall in fuel inflation.

During the end of second quarter, amid certain defaults in the NBFC sector, a credit freeze was witnessed in the bond market especially for NBFCs. The spread of 5-year AAA corporate bond yield over 5-year G-sec yield went up, further the spread for NBFCs/HFCs were even higher with availability of liquidity being limited. For NBFCs and HFCs combined, the share of participation in the issuance of Commercial Paper reduced from upwards of one-half to closer to one-third of the total issuances reflecting increased credit risk premia in the aftermath of the defaults.

Outlook

Looking ahead, favorable factors such as an increase in financial flows to the commercial sector, stabilization of crude oil and other commodity prices, consumption and investment enhancing proposals in the Union Budget 2019-20, and, the expectation of a normal monsoon are expected to boost economic activity. However, there could be headwinds from greater than expected moderation in global growth and global trade as well as unanticipated volatility in global financial markets.

GDP growth is projected to improve from 7.0 per cent in 2018-19 to 7.2 per cent in 2019-20. There are upside as well as downside risks to the baseline growth scenario. The boost to private investment activity from faster resolution of stressed assets and increased as well as more broad-based credit off take amidst rising capacity utilization can raise the baseline growth projection. Conversely, further escalation of trade tensions and protectionist trends, increased volatility in global financial conditions over the uncertainty of the stance of monetary policy in the US and other advanced economies, uncertainty surrounding Brexit, a sharper slowdown in the Chinese economy and deviations of the south-west monsoon from the baseline assumption of a normal monsoon may pose downside risks to the baseline growth path.

Source: International Monetary Fund (IMF), RBI Finance

The NBFC sector experienced liquidity problems in the second half of the financial year 2018-19. The funding squeeze has contributed to higher funding costs and a slowdown in loan growth for non-banking financial companies. 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 under review, the Reserve Bank of India ("RBI”) held six Bi-monthly Monetary Policy Committee ("MPC”) meetings. The Policy Repo rates under the Liquidity Adjustment Facility ("LAF”) was at 6.00% at the beginning of the year. The MPC took the decision to increase the Policy Repo Rate under the LAF by 25 basis points each in the second and third meetings to 6.50% and maintained it at that level till the fifth meeting. Finally, in the sixth meeting, MPC took the decision to reduce the Policy Repo Rate under the LAF by 25 basis points from 6.50% to 6.25%. The MPC changed its stance from "neutral” to "calibrated tightening” in the fourth policy review and reverted back to "neutral” in the sixth policy review. The market continued to expect further reduction in the policy rate.

At the start of the fiscal year (April 2018), 10-year G-Sec benchmark yields (7.17% Gov Stock 2028), were trading at 7.40% levels which was at similar level by end of March 2019. However, in the wake of rising trade tensions, concerns about a "no deal” Brexit and signs of slowing down of the global economy, financial markets sentiments turned cautious and 10-year G-Sec yield touched a peak of 8.18% (around September 2018). The spread of 5-year AAA corporate bond yield over 5-year G-Sec yield moved up, reflecting increased credit risk premia in the aftermath of certain defaults in the NBFC sector. The defaults also led to a liquidity crisis for several non-banking financial companies. The spread declined consequent to the Reserve Bank''s announcement to inject rupee liquidity through long-term foreign exchange buy/sell swap auction. Divergent movements were observed in various segments of the domestic financial market as they reacted differently to the evolving global and local developments during second half of the Financial Year 2018-19. Lower inflation prints, continuing fall in crude oil prices and buoyed sentiments after the announcement of multiple open market purchases by the RBI, resulted in a decline in yields.

During the last quarter of the year under review, a new 10-year benchmark (7.26% GS 2029 - issued in January 2019) which closed the year at 7.35% was issued. During the year, the INR depreciated by 6.7% from INR 65 to INR 69 per USD with intermittent levels being at INR 74/USD around mid-October. The sudden sharp increase and heightened volatility in the currency resulted in inflows from international market being tightened, resulting in further pressure on the currency, which subsided with the global crude prices subsiding.

With a view to promoting and developing a liquid and dynamic corporate bond market, the Securities and Exchange Board of India ("SEBI”) vide its Circular No. SEBI/HO/DDHS/CIR/P/2018/144 dated 26th November, 2018 has provided a framework comprising detailed guidelines for raising of funds by issuance of debt securities and mandated all "large corporates” to raise at least 25 per cent of their incremental borrowings during a financial year by issuing debt securities from the financial year 201920 onwards.

Your Company has been identified as a "Large Corporate” as per the applicability criteria stipulated in the aforesaid SEBI Circular.

During the year under review, your Company continued with its diverse methods of sourcing funds in addition to regular borrowings like Secured and Unsecured Debentures, Term Loans, Fixed Deposits, Commercial Papers, etc., and maintained prudential Asset/ Liability match throughout the year. Your Company sourced long-term debentures and loans from banks and other institutions at attractive rates. Your Company, for the first time has raised funds through issuance of Market Linked Debentures, External Commercial Borrowings ("ECB”) and internationally rated securitisation transactions.

During the year, your Company has successfully completed 7 (seven) securitisation transactions aggregating to Rs. 4,389.20 crores and raised around US- 200 million through ECB.

- Private Placement Issues of Non-Convertible Debentures

During the year under review, your Company issued Secured/Unsecured Redeemable NonConvertible Debentures including Secured Redeemable Principal Protected Non-Convertible Market Linked Debentures ("NCDs”) aggregating to Rs. 6,800.90 Crores on a private placement basis, in various tranches.

As specified in the respective offer documents, the funds raised from NCDs were utilised for the purpose of financing, repayment of dues of other financial institutions/Banks or for longterm working capital.

- Public Issuance of Non-Convertible Debentures

Your Company continues to broaden the liability mix by bringing in new instruments as well as diversifying the investor base and profile. During the year under review, your Company successfully raised Rs. 2,146.99 Crores through its third public issue of 2,14,69,947 Secured Redeemable Non-Convertible Debentures and Unsecured Subordinated Redeemable Non-Convertible Debentures of face value of Rs. 1,000 each, consisting of 1,81,01,224 Secured Redeemable NonConvertible Debentures and 33,68,723 Unsecured Subordinated Redeemable NonConvertible Debentures ("NCDs”). With this issuance, approximately 8% of your Company''s borrowing is funded through this instrument. The NCDs were allotted on 18th January, 2019 and listed on BSE Limited on 21st January, 2019.

The net proceeds received from the Public Issue were used for the purpose of onward lending, financing, refinancing the existing indebtedness of the Company, long-term working capital requirements, Issue expenses and for general corporate purposes. Details of the Issue and the end use were furnished to the Audit Committee.

The Company has been regular in making payments of principal and interest on the NCDs. There are no NCDs which have not been claimed by investors or not paid by the Company after the date on which the NCDs became due for redemption.

- Rupee Denominated Medium Term Note (MTN)

The Rupee Denominated Medium Term Note (MTN) programme of your Company, is listed on the Singapore Exchange Securities Trading Limited. During the year under review, no securities have been issued by your Company under the programme.

INVESTOR RELATIONS

Your Company has been continuously interacting and endeavours to further improve its engagement with Domestic and International investors/analysts by participating either in-person meetings or through use of technology i.e. conference calls, video-conferencing, Tele-presence meetings. Your Company attended multiple investor meets organised by reputed Global and Domestic Broking Houses during the year, both in India and abroad, to communicate details of its performance, important regulatory and market developments and exchange of information. Quarterly and annual earnings calls are scheduled through structured conference calls to keep various stakeholders informed about the past performance and future outlook of the industry, especially those having a bearing on the Company. These interactions with institutional shareholders, fund managers and analysts are based on generally available information that is accessible to the public on a non-discriminatory basis. Your Company uploads the transcript of the quarterly earnings calls on its website which can be accessed by existing and potential investors and lenders.

Your Company believes in transparent communication and building a relationship of mutual understanding and trust. Your Company further ensures that critical information about the Company is available to all the investors by hosting such information on the Company''s website.

CAPITAL ADEQUACY

As on 31st March, 2019, the Capital to Risk Assets Ratio (CRAR) of your Company was 20.3% which is well above the minimum requirement of 15% CRAR prescribed by the Reserve Bank of India.

CREDIT RATING

The credit rating details of the Company as on 31st March, 2019 were as follows:

Rating Agency

Type of Instrument

Rating*

Remarks

India Ratings & Research Private Limited

Commercial Paper Programme and Bank Facilities (Fund/NonFund Based Working Capital Limit)

''IND A1 ''

The ''A1'' rating indicates the Highest Level of Rating. Instruments with this rating are considered to have very strong degree of safety regarding timely payment of financial obligations. Such instruments carry lowest credit risk.

Long-term Debt instruments, Subordinated Debt Programme and Bank Facilities (Fund/NonFund Based Working Capital Limit)

''IND AAA/Stable''

''IND PP-MLD AAA emr/Stable''

The ''AAA'' ratings denote the highest degree of safety regarding timely servicing of financial obligations. Such instruments carry lowest credit risk.

''PP-MLD'' indicates the full principal protection in the equity-linked notes wherein the issuer is obligated to pay the full principal upon maturity.

Suffix “eirr” denotes the exclusion of the embedded market risk from the rating.

CARE Ratings Limited (Formerly known as Credit Analysis & Research Limited)

Long-term Debt instruments and Subordinated Debt Programme

''CARE AAA/Stable''

Brickwork Ratings India Private Limited

Long-term Subordinated Debt Programme

''BWR AAA/Stable''

CRISIL Limited

Fixed Deposit Programme

''CRISIL FAAA/Stable''

Long-term Debt Instruments, Subordinated Debt Programme and Bank Loan Facilities

''CRISIL AA /Stable''

The ''AA '' rating indicates a high degree of safety with regard to timely payment of financial obligations. Such instruments carry very low credit risk.

Commercial Paper Programme and Bank Loan Facilities

''CRISIL A1 ''

The ''A1'' rating indicates the Highest Level of Rating. Instruments with this rating are considered to have very strong degree of safety regarding timely payment of financial obligations. Such instruments carry lowest credit risk.

* The ratings mentioned above were reaffirmed by the Rating Agencies during the Financial Year 2018-19. With the above rating affirmations, your Company continues to enjoy the highest level of rating from all major rating agencies at the same time.

Out of the above, Tier I capital adequacy ratio stood at 15.5% and Tier II capital adequacy ratio stood at 4.8%, respectively.

RBI GUIDELINES

The Company continues to comply with all the applicable regulations prescribed by the Reserve Bank of India ("RBI”), from time to time.

ACHIEVEMENTS

Your Company won several awards and accolades during the year under review. Select few awards/ recognition are enumerated hereunder:

Corporate Governance

- Listed amongst the Top 10 Companies of the ''S&P BSE 100 Companies'' with a ''High Corporate Governance Score'' for the second time in a row, in a study jointly conducted by International Finance Corporation (IFC), a member of the World Bank Group, BSE Limited (BSE) and Institutional Investor Advisory Services (IiAS), based on G20/OECD Principles of Corporate Governance.

Business & Marketing:

- Adjudged the Gold Award Winner as the "Retail NBFC of the Year 2018” by Outlook Money Awards 2018.

- Won two prestigious Awards at the "Rural Marketing Forum and Awards 2019” in the following categories:

a. Most Effective use of Direct Marketing to Rural Consumers for "2 Wheeler to 20 Wheeler Maha Loan Mela”.

b. Best Integrated Rural Marketing Campaign for "Vehicle Loan Festival”.

- Won the Silver Award for MF SUTRADHAAR program and Bronze Award for Suvidha Loans at Flame Awards Asia 2018.

- Won the PRCI (Public Relations Council of India) Collateral Awards 2019 in the following categories:

i) Crystal Award for Table Calendar-2019

ii) Gold Award for Annual Report design

iii) Advertisement Campaign on Vehicle Loan Festival

CSR & Sustainability

- Conferred with the coveted Golden Peacock Award for Corporate Social Responsibility-2018 by the Institute of Directors.

- Listed in Dow Jones Sustainability Index (DJSI) Emerging Markets category for the 6th consecutive year.

- Honoured with ET NOW CSR Leadership Award 2018 for Best CSR Practices and Skill development.

- Included in the "Sustainability Yearbook 2019” released by RobecoSAM.

- Won the Gold Award for Women and Child Health initiative at the CSR Health Impact Awards 2018.

Human Resources

- Listed by Great Place to Work® Institute India in the Top 100 list of Great Places to work in India for 3 years in a row.

- Ranked 11th amongst "25 Best Large Workplaces in Asia 2019”, by Great Place to Work® Institute.

- Won three awards from Great Place to Work® Institute India:

a. Ranked 14th in India''s Best Companies to Work for 2018.

b. Special Category Award in Career Management.

c. Ranked among India''s 15 Best Workplaces in BFSI-2018.

- Listed in Top 100 Best Companies for Women - 2018 by Working Mother and Avtar.

- Won two awards at the TISS Leapvault CLO Summit 2018 in the following categories:

a. Gold Award for the Best Coaching/ Mentoring intervention for "GURU-Mentoring Program”.

b. Silver Award for Best Mobile Learning Intervention for "Manthan - Training Module”.

- Bagged four awards at the Mega Corporate Film Festival Seminar & Awards 2018 in the following categories:

a. First Prize in the Best Corporate Film - "Communicating Employee Engagement-2018”.

b. Second Runners-up in the Best Corporate Film "Communicating Vision, Values, Mission, Purpose - 2018”.

c. Second Runners-up in the Best Corporate Film for "Communicating Organizational Culture - 2018”.

d. Third Runners-up in "Communicating Commitment to Woman Empowerment -2018”.

Information & Technology

- The Project, Voice Induced Business Enablement has won the "Flame Awards - Asia” (Gold category) for the Best Small Budget Campaign of the Year.

FIXED DEPOSITS AND LOANS/ADVANCES

Your Company provides a wide range of Fixed Deposit schemes that cater to the investment needs of various classes of investors. These Deposits carry attractive interest rates with superior service enabled by robust processes and technology. In order to tap rural and semi-urban savings and reach out to the farthest customers, your Company continues to expand its network and make its presence felt in the most remote regions of the country.

During the year, CRISIL has reaffirmed a rating of ''CRISIL FAAA/Stable'' for your Company''s Fixed Deposits. This rating represents the highest degree of safety regarding timely servicing of financial obligations and carries the lowest credit risk. Your Company''s Deposits continue to be a preferred investment amongst the investors.

As on 31st March, 2019, your Company has mobilized funds from Fixed Deposits to the tune of Rs. 5,698.88 Crores, with an investor base of over 1,86,359 investors.

Your Company continues to serve the investors by introducing several customer centric measures on an ongoing basis to further strengthen its processes in sync with the requirements of the Fixed Deposit holders. The Company communicates various intimations via SMS, e-mails, post, etc., to its investors as well as sends reminder emails to clients whose TDS is likely to be deducted before any payout/ accrual. Your Company also provides online renewal facility, online generation of TDS certificates from customer/broker portal and Seamless Investment process for employees.

During the year under review, your Company has rolled out several initiatives aimed at offering a superior customer experience. Some key ones are:

- Initiation of online acceptance of Deposits through the Company''s website;

- Introduction of Dhan Samruddhi Deposits which are available through Digital Channel Partners;

- Introduction of Bulk Deposits above Rs. 5 Crores.

As at 31st March, 2019, 6,152 Deposits amounting to Rs.7.22 Crores had matured for payment and remained unclaimed. The unclaimed Deposits have since reduced to 5,421 Deposits amounting to Rs.

6.02 Crores. There has been no default in repayment of Deposits or payment of interest during the year.

Your Company being a Non-Banking Financial Company, the disclosures required as per Rule 8 (5) (v) and (vi) of the Companies (Accounts) Rules, 2014 read with Sections 73 and 74 of the Companies Act, 2013, are not applicable to it.

The information pursuant to Clause 35(1) of Master Direction DNBR.PD.002/03.10.119/2016-17 dated 25th August, 2016 issued by the Reserve Bank of India on Non-Banking Financial Companies Acceptance of Public Deposits (Reserve Bank) Directions, 2016, regarding unpaid/unclaimed public deposits as on 31st March, 2019, is furnished below:

i. total number of accounts of Public Deposits of the Company which have not been claimed by the depositors or not paid by the Company after the date on which the deposit became due for repayment: 6,152.

ii. the total amounts due under such accounts remaining unclaimed or unpaid beyond the dates referred to in clause (i) as aforesaid: Rs. 7,22,20,437.

Depositors were intimated regarding the maturity of deposits with a request to either renew or claim their Deposits. Your Company continues to send intimation letters via registered post every 3 months to all those Fixed Deposit holders whose Deposits have matured as well as to those whose Deposits remain unclaimed. Where the Deposit remains unclaimed, follow-up action is also initiated through the concerned agent or branch.

Pursuant to Section 125(2) (i) of the Companies Act, 2013 read with the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 ("the IEPF Rules”) as amended from time to time, matured Deposits remaining unclaimed for a period of seven years from the date they became due for payment are required to be transferred to the Investor Education and Protection Fund (IEPF) Authority established by the Central Government. Further, interest accrued on the matured deposits which remain unclaimed for a period of seven years from the date of payment will also be transferred to the IEPF under Section 125(2] (k). The concerned depositor can claim the Deposit and/or interest from the IEPF Authority by following the procedure laid down in the IEPF Rules.

During the year under review, an amount of Rs. 0.09 Crores has been transferred to the IEPF Authority.

During the year under review, the Company has not given any loans and advances in the nature of loans to its subsidiaries or associate or loans and advances in the nature of loans to firms/companies in which Directors are interested.

Accordingly, the disclosure of particulars of loans/ advances, etc., as required to be furnished in the Annual Accounts of the Company pursuant to Regulations 34(3) and 53(f) read with paragraph A of Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is not applicable to the Company.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS IN SECURITIES

Pursuant to Section 186(11) of the Companies Act, 2013 ("the Act”), the provisions of Section 186(4) of the Act requiring disclosure in the Financial Statements of the full particulars of the loans made and guarantees given or securities provided by a Non Banking Financial Company in the ordinary course of its business and the purpose for which the loan or guarantee or security is proposed to be utilized by the recipient of the loan or guarantee or security are exempted from disclosure in the Annual Report.

Further, pursuant to the provisions of Section 186 (4) of the Act, the details of investments made by the Company are given in the Notes to the Financial Statements.

SUSTAINABILITY INITIATIVES

Sustainability has invariably been a core to the purpose of Mahindra Finance. At the heart of our organizational strategy is an inclusive business model that enables the residents of semi-urban and rural India to access formal channels of credit/finance which helps them in creating long-term value. In our journey spanning more than two decades, we have empowered the lives of millions of Indians by providing access to myriad financial services and products, which have helped them to "Rise for Good”. Your Company has been enabling them to meet their aspirations through financial product offerings. Your Company helps the people build their homes through affordable home loan services provided by Mahindra Rural Housing Finance Limited, secure their life and assets by insurance solutions of Mahindra Insurance Brokers Limited and offers investment options by Mahindra Asset Management Company Private Limited. By providing the right set of opportunities in the remote areas and enabling our customers to advance in their lives, we are making positive contribution to multiple stakeholders. Your Company lays strong emphasis on customer centricity with its customer base spread across more than 3.5 lakh villages in India with majority of them belonging to the ''Earn and Pay'' segment.

Your Company commenced its journey towards reporting sustainability performance in 2008-09 through Mahindra Group''s Sustainability Report and in the year 2012-13 your Company released its first standalone Sustainability Report. In the reporting year, the Company released its Sixth Sustainability Report for the Financial Year 2017-18 with the theme "I Am Responsible” based on Integrated Reporting framework and adhering to the Global Reporting Initiative''s (GRI Standards). The Report embodies a motto that each individual of the organization firmly believes in ''Making Sustainability Personal'' under the theme "I Am Responsible”. It also showcases how your Company responsibly creates value for all its stakeholders.

This Report is hosted on your Company''s website at the web-link: https://www.mahindrafinance.com/ sustainability.aspx.

Your Company continued to focus on sustainability awareness for different stakeholders and took various initiatives to engage them on these fronts. In 2018, your Company became the 1st Financial Company in India to be committed towards call to action for Science Based Targets. The Science Based Targets initiative (SBTi) requires companies to publicly commit to setting carbon emission reduction targets that are in line with climate science.

Your Company has been listed on the Dow Jones Sustainability Index (DJSI) Emerging Market Trends for the sixth consecutive year. Your Company is the only Company from amongst the Diversified Financial Services Companies in India to have made it to this list. To be included in the DJSI, companies are assessed and selected based on their long term Environmental, Social and Governance (ESG) management plans and actions. Your Company got selected in "The Sustainability Yearbook 2019” being the only Financial Services Sector Company to qualify amongst 9 companies from India. This signifies your Company being amongst top Sustainability performers in Diversified Financial Services Sector across the World based on Corporate Sustainability Assessment done by Robeco SAM.

Your Company''s approach has been to make its environmental disclosure transparent, and accordingly, it has been reporting disclosures and reports on its performance through the Carbon Disclosure Project (CDP) India since Financial Year 2011-12. During the reporting year, your Company attained CDP Performance Band - C meaning that your Company is at "Awareness” band.

During the year, your Company made proactive efforts to reduce CO2 emissions (carbon footprint) through Project "Mahindra Hariyali”, by planting more than 71,000 saplings throughout the country. The Company''s Annual Family Fun Day "Vrindavan” attained Yale''s Gold Level Green Event Certification as 87% waste generated at Vrindavan was recycled, composted and sent to biogas plants.

Your Company is gearing up to be future ready by making sustainability and climate change an integral part of its risk framework and taking measures to mitigate and manage them. Weather reports are assessed on a regular basis and aligned with business operations to protect the customers and minimize the risk impact. The outlook for the future has been positive and your Company is well equipped to enable its customers and communities to progress through its inclusive and sustainable business model.

BUSINESS RESPONSIBILITY REPORT

The Business Responsibility Report ("BRR”) of your Company for the year 2018-19 forms part of this Annual Report as required under Regulation 34(2) (f) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 and is appended as “Annexure II”.

Your Company is building an inclusive organization by empowering all the stakeholders and facilitating their contribution towards growth that is both holistic and long term. Through the inclusive business model, your Company is endeavoring to cater to the bottom of the pyramid in the rural and semi-urban areas, enabling them to earn their livelihood through varied financial products and services. Your Company has always been conscious of its role as a responsible corporate citizen. Through its wide network of branches with locally-recruited employees, strong and lasting relationships with its stakeholders, large customer base, vast experience and market knowledge, your Company is providing financial resources to underserviced regions of the country.

The BRR can also be accessed on the Company''s website at the web-link: https://www.mahindrafinance.com/ sustainability.aspx.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

Transforming lives of the rural population has been the primary focus of all CSR initiatives undertaken by your Company. The endeavour is to empower the rural communities and help them unleash their potential. Your Company has identified Healthcare, Education (including Livelihood) and Environment as key CSR thrust areas for the welfare of one of the major stakeholders - rural communities in India.

Building on the momentum created last year through several education and livelihood projects, your Company continued to provide scholarships to 2,500 undergraduate and 500 graduate students, organised visits to municipal schools and financial support to run a vocational skill building center catering to 500 People with Disability. In an effort to encourage more women to take up livelihood opportunities, your Company also implemented Drivers Training Program for 375 women and an Auto-mechanic Training Program for 180 women. Further, your Company is empowering youth, women and working population with the knowledge of sound financial practices to enable them in managing their money better by conducting a Financial Literacy workshop. Reaffirming its commitment to the cause of education, your Company continued its support to over 10,450 underprivileged girl children from socially and economically marginalised families living in urban, rural and tribal areas of India. To promote inclusive growth of socially and economically disadvantaged youth, your Company continued its support to Mahindra Pride School which skilled 3,453 youth and all of them have been absorbed in various organisations. Further, an additional 39,783 students were trained through 866 batches of Mahindra Pride Classrooms conducted through Polytechnics and Arts & Science Colleges in 14 States.

In the area of healthcare, your Company organized nationwide blood donation drives, health checkup camps, Swachh Bharat activities, donated 14 ambulances that have made access to primary healthcare centers easy, for several tribal and rural patients across the nation. Your Company has revamped the Medical Equipment Donation project to provide financial support for procuring crucial equipment used in liver transplants and dialysis for kidney patients. Additionally, your Company continued its support for Maternal & Child Health Care project which provides nutritional supplementation to anemic pregnant and lactating women, adolescents and malnourished children in rural areas.

For increasing focus on better environment, your Company helped build a greener tomorrow by planting over 72,500 trees with a higher survival rate.

Apart from the key thrust areas, your Company contributed funds for other causes such as preservation and promotion of the fine arts & culture and conducted visits to orphanage homes, differently abled homes, homes for the elderly, etc., to re-affirm its pledge to the society.

During the year under review, your Company has spent Rs. 26.87 Crores on CSR projects/programs. 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. 26.81 Crores. Your Company is in compliance with the statutory requirements in this regard.

CSR COMMITTEE

During the year under review, the CSR Committee comprised of Mr. Piyush Mankad (Chairman), Mr. Ramesh Iyer, Mr. V. Ravi and Dr. Anish Shah. The Committee, inter alia, reviews and monitors the CSR activities.

Consequent upon the resignation of Mr. Piyush Mankad, as an Independent Director with effect from the close of business hours on 31st March, 2019, the Committee was reconstituted effective from 9th April, 2019 as follows:

Name

Category

Mr. Dhananjay Mungale

- Chairman of the Committee (Independent Director)

Ms. Rama Bijapurkar

- Independent Director

Mr. Ramesh Iyer

- Vice-Chairman & Managing Director

Mr. V. Ravi

- Executive Director & Chief Financial Officer

Dr. Anish Shah

- Non-Executive Non Independent Director

CSR POLICY

The CSR Policy of the Company duly amended, is hosted on the Company''s website at the web-link: https://www.mahindrafinance.com/csr.aspx and a

brief outline of the CSR Policy and the CSR initiatives undertaken by the Company during the year as per Annexure prescribed in the Companies (Corporate Social Responsibility Policy) Rules, 2014 have been appended as “Annexure III” to this Report.

EXTRACT OF ANNUAL RETURN

Pursuant to sub-section 3(a) of Section 134 and subsection (3) of Section 92 of the Companies Act, 2013, read with Rule 12(1) of the Companies (Management and Administration) Rules, 2014, an extract of the Annual Return as at 31st March, 2019 in Form No. MGT-9, is appended as “Annexure IV” and forms part of this Report.

The Annual Return of the Company as at 31st March, 2019 has been placed on the website of the Company and can be accessed at https://www. mahindrafinance.com/annual-reports.aspx.

BOARD MEETINGS AND ANNUAL GENERAL MEETING

The calendar of the Board/Committee Meetings and the Annual General Meeting is circulated to the Directors in advance to enable them to plan their schedule for effective participation at the respective meetings. Additional Board Meetings are convened by giving appropriate notice to address business exigencies. At times certain decisions are taken by the Board/Committee through circular resolutions.

All the decisions and urgent matters approved by way of circular resolutions are placed and noted at the subsequent Board/Committee Meeting.

The Board of Directors met six times during the year under review, on 25th April, 2018, 27th July, 2018, 24th October. 2018, 25th January. 2019, 7th March, 2019 and 27th March, 2019. The requisite quorum was present for all the Meetings. The maximum time gap between any two Meetings was not more than one hundred and twenty days. These Meetings were well attended. The 28th Annual General Meeting (AGM) of the Company was held on 27th July, 2018.

Detailed information on the Meetings of the Board, its Committees and the AGM is included in the Report on Corporate Governance, which forms part of this Annual Report.

MEETINGS OF INDEPENDENT DIRECTORS

The Independent Directors met twice during the year under review, on 24th October, 2018 and 6th March, 2019. The Meetings were conducted in an informal manner without the presence of the Wholetime Directors, the Non-Executive Non-Independent Directors, or any other Management Personnel.

COMMITTEES OF THE BOARD OF DIRECTORS

The Company has various Committees which have been constituted as a part of good corporate governance practices and the same are in compliance with the requirements of the relevant provisions of applicable laws and statutes.

During the year under review, the Audit Committee comprised of Mr. C. B. Bhave as the Chairman and Mr. Dhananjay Mungale, Mr. M. G. Bhide, Ms. Rama Bijapurkar, Mr. Piyush Mankad, Mr. V. S. Parthasarathy and Dr. Anish Shah as Members.

Consequent upon the resignation of Mr. M. G. Bhide and Mr. Piyush Mankad, Independent Directors from the Board of Directors with effect from the close of business hours on 31st March, 2019, and the appointment of Mr. Milind Sarwate as an Independent Director of the Company with effect from 1st April, 2019, the Committee stands reconstituted effective from 9th April, 2019 as follows:

Name

Category

Mr. C. B. Bhave

- Chairman of the Committee (Independent Director)

Mr. Dhananjay Mungale

- Independent Director

Ms. Rama Bijapurkar

- Independent Director

Mr. V. S. Parthasarathy

- Non-Executive Non Independent Director

Dr. Anish Shah

- Non-Executive Non Independent Director

Mr. Milind Sarwate

- Independent Director

The recommendations of the Audit Committee were duly approved and accepted by the Board during the year under review.

The other Committees of the Board are:

i) Nomination and Remuneration Committee

ii) Stakeholders Relationship Committee

iii) Corporate Social Responsibility Committee

iv) Risk Management Committee

v) Asset Liability Committee

vi) Committee for Strategic Investments

vii) IT Strategy Committee

The details with respect to the composition, powers, roles, terms of reference, Meetings held and attendance of the Directors at such Meetings of the relevant Committees are given in detail in the Report on Corporate Governance of the Company which forms part of this Annual Report.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

Directors

Mr. M. G. Bhide and Mr. Piyush Mankad were appointed as Independent Directors by the Members at the 24th Annual General Meeting held on 24th July, 2014 for a term of 5 (five) consecutive years commencing from 24th July, 2014 to 23rd July, 2019, not liable to retire by rotation.

Pursuant to the applicability of Regulation 17(1A) of the Listing Regulations, as amended by the SEBI (Listing Obligations and Disclosure Requirements) (Amendment) Regulations, 2018, mandating approval of Members by a special resolution for the appointment/continuance of Non-Executive Director(s) above the age of 75 years, effective from 1st April, 2019, Mr. M. G. Bhide and Mr. Piyush Mankad, who have attained the age of 75 years, tendered their resignation as Independent Directors from the Board of Directors of the Company with effect from the close of business hours on 31st March, 2019.

The Board places on record its sincere appreciation for the invaluable contribution and guidance provided by Mr. M. G. Bhide and Mr. Piyush Mankad during their tenure as Independent Directors of the Company.

The Board of Directors, based on the recommendation of the Nomination and Remuneration Committee, vide its Circular Resolution dated 25th February, 2019 proposed the appointment of Mr. Milind Sarwate as an Independent Director of the Company to hold office for a term of 5 (five) consecutive years commencing from 1st April, 2019 to 31st March, 2024, not liable to retire by rotation, subject to the approval of the Shareholders.

Subsequent to the above, the Shareholders of the Company have pursuant to the provisions of Sections 149, 150, 152 read with Schedule IV and all other applicable provisions of the Companies Act, 2013 and the Companies (Appointment and Qualification of Directors) Rules, 2014, approved the appointment of Mr. Milind Sarwate as an Independent Director of the Company with effect from 1st April, 2019 for a term of 5 (five) consecutive years, vide an Ordinary Resolution passed by means of a Postal Ballot on 31st March, 2019.

Mr. V. Ravi, Executive Director & Chief Financial Officer, retires by rotation at the forthcoming Annual General Meeting and, being eligible, offers himself for reappointment.

The Nomination and Remuneration Committee, on the basis of performance evaluation of Independent Directors and taking into account the business knowledge, experience and the substantial contribution made by Mr. Dhananjay Mungale and Ms. Rama Bijapurkar during their tenure, has recommended to the Board that the continued association of Mr. Dhananjay Mungale and Ms. Rama Bijapurkar as Independent Directors of the Company would be beneficial to the Company. Based on the above and the performance evaluation of Independent Directors, the Board recommends the re-appointment of Mr. Dhananjay Mungale and Ms. Rama Bijapurkar, as Independent Directors of the Company, not liable to retire by rotation, to hold office for a second term of 5 (five) consecutive years on the Board of the Company, commencing from 24th July, 2019 to 23rd July, 2024 The Company has received the requisite Notices from Members in writing proposing their appointment as Independent Directors.

Mr. Dhananjay Mungale and Ms. Rama Bijapurkar have given their consent for re-appointment and have confirmed that they continue to retain their status as Independent Directors and that they do not suffer from any disqualifications for appointment.

Mr. Dhananjay Mungale, Ms. Rama Bijapurkar and Mr. V. Ravi are not debarred or disqualified from holding the office of Director by virtue of any SEBI Order or any other such authority, pursuant to circulars dated 20th June, 2018 issued by BSE Limited and the National Stock Exchange of India Limited pertaining to enforcement of SEBI Orders regarding appointment of Directors by the listed companies.

All the Directors of the Company have confirmed that they satisfy the "fit and proper” criteria as prescribed in Chapter XI of RBI Master Direction No. DNBR. PD. 008/ 03.10.119/2016-17 dated 1st September, 201 6 and that they are not disqualified from being appointed/continuing as Directors in terms of Section 164(2) of the Companies Act, 2013.

The details of the Directors being re-appointed are set out in the Notice convening the ensuing AGM.

Key Managerial Personnel

Mr. Ramesh Iyer, Vice-Chairman & Managing Director, Mr. V. Ravi, Executive Director & Chief Financial Officer and Ms. Arnavaz M. Pardiwalla, Company Secretary of the Company have been designated as the Key Managerial Personnel of the Company (KMP) pursuant to the provisions of Sections 2(51) and 203 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

There has been no change in the KMP during the year under review.

Declaration by Independent Directors

The Company has received declarations from all the Independent Directors of the Company confirming that they fulfill the criteria of independence as prescribed under sub-section (6) of Section 149 of the Companies Act, 2013 and Regulation 16(1)(b) of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Directors'' Responsibility Statement

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

i. in the preparation of the annual accounts for financial year ended 31st March, 2019, the applicable accounting standards have been followed and there are no material departures in adoption of these standards.

ii. they have in consultation with the Statutory Auditors selected such 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 31st March, 2019 and of the profit of the Company for the year ended on that date.

iii. they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

iv. they have prepared the annual accounts for financial year ended 31st March, 2019 on a going concern basis.

v. they have laid down adequate internal financial controls to be followed by the Company and that such internal financial controls were operating effectively during the financial year ended 31st March, 2019.

vi. they have devised proper systems to ensure compliance with provisions of all applicable laws and that such systems were adequate and operating effectively during the financial year ended 31st March, 2019.

Performance Evaluation of the Board

The Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("the Listing Regulations”) stipulate the evaluation of the performance of the Board, its Committees, Individual Directors and the Chairperson.

The Company has formulated a Policy for performance evaluation of the Independent Directors, the Board, its Committees and other individual Directors which includes criteria for performance evaluation of the Non-Executive Directors and Executive Directors.

The evaluation framework for assessing the performance of Directors comprises of various key areas such as attendance at Board and Committee Meetings, quality of contribution to Board discussions and decisions, strategic insights or inputs regarding future growth of the Company and its performance, ability to challenge views in a constructive manner, knowledge acquired with regard to the Company''s business/ activities, understanding of industry and global trends, etc.

The evaluation involves self-evaluation by the Board Member and subsequent assessment by the Board of Directors. A member of the Board will not participate in the discussion of his/her evaluation.

Pursuant to the provisions of the Companies Act, 2013 and Regulation 17 of 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 the Directors individually (including Independent Directors).

Feedback was sought by way of well-defined and structured questionnaires covering various aspects of the Board''s functioning such as adequacy of the composition of the Board and its Committees, Board culture, areas of responsibility, execution and performance of specific duties, obligations and governance, compliance, oversight of Company''s subsidiaries, etc., and the evaluation was carried out based on responses received from the Directors.

A separate exercise was carried out by the Nomination and Remuneration Committee of the Board to evaluate the performance of individual Directors who were evaluated on several parameters such as level of engagement and contribution, independence of judgment safeguarding the interest of the Company and its minority shareholders and knowledge acquired with regard to the Company''s business/activities.

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 Company was also carried out by the Independent Directors, taking into account the views of the Executive Directors and NonExecutive Directors.

The performance evaluation of the Independent Directors was carried out by the entire Board excluding the Director being evaluated. Qualitative comments and suggestions of Directors were taken into consideration by the Chairman of the Board and the Chairman of the Nomination and Remuneration Committee. The Directors have expressed their satisfaction with the evaluation process.

Familiarisation Programme for Independent Directors

The details of programmes for familiarisation of Independent Directors with the Company, their roles, rights, responsibilities in the Company, nature of the industry in which the Company operates, business model of the Company and related matters along with details of number of programmes and number of hours spent by each of the Independent Directors during the Financial Year 2018-19, in terms of the requirements of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 are available on the website of the Company and can be accessed at the web-link: https:// www.mahindrafinance.com/pdf/Familiarisation Programme for the FY 2018 19.pdf.

Policies on Appointment of Directors and Senior Management and Remuneration of Directors,

Key Managerial Personnel and Employees

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

In accordance with the provisions of Section 134(3)(e) of the Companies Act, 2013 ("the Act”) read with Section 178(2) of the Act and Regulation 17 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, your Company has adopted a Policy on Appointment of Directors and Senior Management and succession planning for orderly succession to the Board and the Senior Management, which inter alia, includes the criteria for determining qualifications, positive attributes and independence of Directors, identification of persons who are qualified to become Directors and who may be appointed in the Senior Management team, succession planning for Directors and Senior Management, and the Talent Management framework of the Company.

During the year under review, the Board based on the recommendations of the Nomination and Remuneration Committee amended the aforesaid Policy to align it in accordance with the provisions of SEBI (Listing Obligations and Disclosure Requirements) (Amendment) Regulations, 2018.

ii) Policy on Remuneration of Directors and the Remuneration Policy for Key Managerial Personnel and Employees of the Company

Your Company has also adopted the Policy on Remuneration of Directors and the Remuneration Policy for Key Managerial Personnel and Employees of the Company in accordance with the provisions of sub-section (4) of Section 178 of the Act.

During the year under review, your Company made changes in these Policies to align them with the amendments made pursuant to the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, respectively.

The Policy on Remuneration of Directors and the Remuneration Policy for Key Managerial Personnel and Employees of the Company, as amended, are appended as “Annexure V-A” and “Annexure V-B”, respectively, and form part of this Report.

The criteria for determining qualifications, positive attributes and independence of a Director and the Remuneration Policies for Directors, Key Managerial Personnel and other employees have been discussed in detail in the Report on Corporate Governance.

AUDITORS

Statutory Auditors

Messrs. B S R & Co. LLP, Chartered Accountants, (ICAI Firm Registration No. 101 248W/W-100022), were appointed as Statutory Auditors of the Company at the Twenty-seventh Annual General Meeting ("AGM”) to hold office for a period of five years, commencing from the conclusion of the 27th AGM held on 24th July, 2017 till the conclusion of the 32nd AGM of the Company to be held in the year 2022, subject to ratification of their appointment by the Members at the AGM, as may be applicable.

Pursuant to the Notification issued by the Ministry of Corporate Affairs on 7th May, 2018 amending Section 139 of the Companies Act, 2013 and the applicable Rules, the mandatory requirement for ratification of appointment of Auditors by the Members at every AGM has been omitted and hence the Company has not proposed ratification of appointment of Messrs. B S R & Co. LLP, Chartered Accountants, at the ensuing AGM.

The Statutory Auditors have given a confirmation to the effect that they are eligible to continue with their appointment and that they have not been disqualified in any manner from continuing as Statutory Auditors. The remuneration payable to the Statutory Auditors shall be determined by the Board of Directors based on the recommendation of the Audit Committee.

The Report given by the Auditors on the Financial Statements of the Company for the Financial Year 2018-19 is a part of the Annual Report. The Report is unmodified and does not contain any qualification, reservation, adverse remark or disclaimer.

The Statutory Auditors were present at the last AGM.

Secretarial Auditor

The Board of Directors of the Company has appointed Messrs. KSR & Co., Company Secretaries LLP to conduct the Secretarial Audit of the Company pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. In accordance with the provisions of sub-section (1) of Section 204, the Secretarial Audit Report for the Financial Year 2018-19 is appended to this Report as “Annexure VI”.

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

Cost Records and Cost Audit

Maintenance of cost records and requirement of cost audit as prescribed under the provisions of Section 148(1) of the Companies Act, 2013 are not applicable in respect of the business activities carried out by the Company.

Reporting of Frauds by Auditors

During the year under review, the Statutory Auditors and the 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, details of which need to be mentioned in this Report.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All contracts/arrangements/transactions entered into by the Company during the Financial Year with related parties were in the ordinary course of business and on an arm''s length basis. During the year under review, your Company had not entered into any contract/ arrangement/transaction with Related Parties which could be considered material in accordance with the Policy on Related Party Transactions. Pursuant to Section 134 (3) (h) read with Rule 8 (2) of the Companies (Accounts) Rules, 2014, there are no transactions to be reported under Section 188 (1) of the Companies Act, 2013. Accordingly, the disclosure of Related Party Transactions, as required under Section 134 (3) (h) of the Companies Act, 2013 in Form AOC-2 is not applicable to the Company.

During the year under review, the Board of Directors based on the recommendations of the Audit Committee amended the Policy on Related Party Transactions in line with the revised Listing Regulations and the same is uploaded on the Company''s website at the web-link: https://www.mahindrafinance.com/policies.aspx.

Further details on the transactions with related parties are provided in the accompanying financial statements.

MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY

No material changes and commitments have occurred after the closure of the Financial Year 2018-19 till the date of this Report, which would affect the financial position of your Company.

RISK MANAGEMENT POLICY

Your Company has a comprehensive Risk Management Policy in place and has laid down a well-defined risk management framework to identify, assess and monitor risks and strengthen controls to mitigate risks. Your Company has established procedures to periodically place before the Risk Management Committee and the Board of Directors, the risk assessment and minimisation procedures being followed by the Company and steps taken by it to mitigate these risks.

During the year under review, the Board based on the recommendations of the Risk Management Committee amended the Risk Management Policy which now specifically covers Cyber Security and related risks, in accordance with the amendments under the Listing Regulations.

The Risk Management Policy, inter alia, includes identification therein of elements of risk, including Cyber Security and related risks as well as those risks which in the opinion of the Board may threaten the existence of the Company. The 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 Company.

The development and implementation of Risk Management Policy adopted by the Company is discussed in detail in the Management Discussion and Analysis chapter, which forms part of this Annual Report.

WHISTLE BLOWER POLICY/VIGIL MECHANISM

The Company promotes ethical behaviour in all its business activities and has established a vigil mechanism for its Directors, Employees and Stakeholders associated with the Company to report their genuine concerns. The Vigil Mechanism as envisaged in the Companies Act, 2013 and the Rules prescribed thereunder and the Listing Regulations is implemented through the Whistle Blower Policy, to provide for adequate safeguards against victimisation of persons who use such mechanism and make provision for direct access to the Chairperson of the Audit Committee.

As per the Whistle Blower Policy implemented by the Company, the Employees, Directors, customers, dealers, vendors, suppliers, or any Stakeholders associated with the Company are free to report illegal or unethical behaviour, actual or suspected fraud or violation of the Company''s Codes of Conduct or Corporate Governance Policies or any improper activity to the Chairman of the Audit Committee of the Company or Chairman of the Company or Convenor of the Corporate Governance Cell.

During the year under review, the Board of Directors based on the recommendation of the Audit Committee has amended the Whistle Blower Policy to inter alia, enable employees to report incidents of leak or suspected leak of unpublished price sensitive information in line with the changes made in the SEBI (Prohibition of Insider Trading) Regulations, 2015.

The Whistle Blower Policy provides for protected disclosure and protection to the Whistle Blower. Under the Whistle Blower Policy, the confidentiality of those reporting violation(s) is protected and they are not subject to any discriminatory practices. Protected disclosures can also be made by sending an email at the designated email id : mmfsl_whistleblower@ mahindra.com.

The Whistle Blower Policy has been appropriately communicated within the Company and is available on the website of your Company at the web-link: https://www.mahindrafinance.com/pdf/MMFSL VigilMechanism.pdf.

No personnel have been denied access to the Audit Committee.

SUBSIDIARY, JOINT VENTURE AND ASSOCIATE COMPANIES

The Company''s subsidiaries and joint venture continue to contribute to the overall growth in revenues and overall performance of your Company.

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

Your Company has formulated a Policy for determining ''Material'' Subsidiaries as defined in Regulation 16 of the Listing Regulations. During the year under review, the Policy was amended in line with the requirements of the SEBI (Listing Obligations and Disclosure Requirements) (Amendment) Regulations, 2018. This Policy has been hosted on the website of the Company and can be accessed through the web-link: https://www.mahindrafinance.com/policies.aspx.

SUBSIDIARIES

Mahindra Insurance Brokers Limited

During the year under review, Mahindra Insurance Brokers Limited (MIBL), the subsidiary in the business of Direct and Re-insurance Broking, serviced approximately 2.27 million insurance cases, with a total of 22,65,146 cases for both Life and Non-Life Retail business. The customized Life insurance cover "Mahindra Loan Suraksha” (MLS) increased from 6,85,264 lives covered with a Sum Assured of Rs. 21,579.3 Crores in the Financial Year 2017-18 to 8,13,742 lives covered with a Sum Assured of Rs. 27,765.0 Crores in the Financial Year 2018-19. A substantial portion of MLS continues to be covered in the rural markets.

MIBL achieved a growth of 11% in Gross Premium facilitated for the Corporate and Retail business lines, increasing from Rs. 2,049.1 Crores in the Financial Year 2017-18 to Rs. 2,267.8 Crores in the Financial Year 2018-19. The Total Income increased by 32% from Rs. 245.1 Crores in the Financial Year 2017-18 to Rs. 323.4 Crores in the Financial Year 2018-19. The Profit before Tax increased by 24% from Rs. 83.2 Crores to Rs. 102.9 Crores crossing a milestone of Rs. 100 Crores, and the Profit after Tax increased by 33% from Rs. 53.6 Crores to Rs. 71.5 Crores during the same period.

MIBL has been able to reach the benefit of insurance to cover 3,00,000 villages across India.

Mahindra Rural Housing Finance Limited

Mahindra Rural Housing Finance Limited (MRHFL), the Company''s subsidiary in the business of providing loans for purchase, renovation, construction of houses to individuals in the rural and semi-urban areas of the country, registered a total income of Rs. 1,383.9 Crores as compared to Rs. 1,034.8 Crores for the previous year, registering a growth of 34%. Profit before tax was 52% higher at Rs. 366.2 Crores as compared to Rs. 241.2 Crores for the previous year. Profit after tax was 44% higher at Rs. 250.5 Crores as compared to Rs. 173.9 Crores for the previous year.

During the year under review, MRHFL disbursed loans aggregating to Rs. 2,581.1 Crores as against Rs. 2,789.2 Crores in the previous year.

MRHFL continued its focus on serving customers in rural India. Majority of the loans disbursed were to customers in villages with an average annual household income of less than Rs. 2 lakhs. During the year under consideration, MRHFL disbursed home loans to around 1,71,000 households (in addition to around 7,79,000 existing households as on 31st March, 2018). MRHFL has been expanding its geographical presence to provide affordable services for rural households.

During the year under review, operations of MRHFL were strengthened in the States of Maharashtra, Gujarat, Rajasthan, Tamil Nadu, Andhra Pradesh, Telangana, Chhattisgarh, Kerala, Karnataka, Madhya Pradesh, Uttar Pradesh, Uttarakhand and Bihar.

Acquisition of Shareholding of National Housing Bank in MRHFL

In March 2019, your Company approved the acquisition of 1,18,91,511 Equity Shares of Rs. 10 each held by National Housing Bank representing 9.68% of the share capital in MRHFL, at a premium of Rs. 231.16 per share, aggregating to Rs. 286.78 Crores.

Post the acquisition subsequent to the year end, the shareholding of your Company in MRHFL stands increased from 88.75% to 98.43% of MRHFL''s share capital.

Mahindra Asset Management Company Private Limited

Mahindra Asset Management Company Private Limited (MAMCPL), a wholly-owned subsidiary of the Company acts as an Investment Manager for the schemes of Mahindra Mutual Fund. As on 31st March, 2019, MAMCPL was acting as the Investment Manager for nine schemes.

The Assets under Management in these nine schemes were Rs. 4,871 Crores in March 2019 as compared to Rs. 3,352 Crores in March 2018. Of these assets, Rs. 1,449 Crores were in equity schemes in March 2019 as compared to Rs. 1,173 Crores in March 2018. MAMCPL has empanelled more than 11,500 distributors and opened 1,59,399 investor accounts in these schemes recording a rise of more than 25%.

During the year under review, the total income of MAMCPL was Rs.28.1 Crores as compared to Rs. 23.5 Crores for the previous year, registering a growth of 19%. The operations for the year have resulted in a loss of Rs.39.5 Crores as against a loss of Rs.37.5 Crores during the previous year.

Mahindra Trustee Company Private Limited

Mahindra Trustee Company Private Limited (MTCPL), your Company''s wholly-owned subsidiary, acts as the Trustee to Mahindra Mutual Fund.

During the year, MTCPL earned trusteeship fees of Rs. 23.50 lakhs and other income of Rs. 1.10 lakhs as compared to Rs.23.87 lakhs and Rs. 0.83 lakhs respectively, for the previous year. The total expenses for the year were Rs. 25.34 lakhs as against Rs. 24.25 lakhs in the previous year. MTCPL recorded a loss of Rs. 0.83 lakhs for the year under review as against a profit of Rs. 0.44 lakhs in the previous year.

JOINT VENTURE Mahindra Finance USA LLC.

The joint venture company''s disbursement registered a decline of 8.8% to USD 755.11 Million for the year ended 31st March, 2019 as compared to USD 828.38 Million for the previous year.

Total Income grew by 20.58% to USD 67.68 Million for the year ended 31st March, 2019 as compared to USD 56.13 Million for the previous year. Profit before tax was 9.98% higher at USD 18.08 Million as compared to USD 16.44 Million for the previous year. Profit after tax grew at a healthy rate of 41.86% to USD 13.76 Million as compared to USD 9.70 Million in the previous year.

Names of companies which have become or ceased to be subsidiaries, joint ventures or associate companies during the year

During the year under review, no company has become or ceased to be a subsidiary, joint venture or associate of your Company.

Subsequent to the year end, Mahindra Finance CSR Foundation, has been incorporated on 2nd April, 2019 as a wholly-owned subsidiary of the Company registered under Section 8 of the Companies Act, 2013, to promote and support CSR projects and activities.

CONSOLIDATED FINANCIAL STATEMENTS

The Consolidated Financial Statements of the Company, its subsidiaries and its associate(s) for the Financial Year 2018-19, prepared in accordance with the relevant provisions of 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 and associate(s).

Pursuant to the provisions of Section 136 of the Companies Act, 2013, the Financial Statements of the Company, Consolidated Financial Statements along with relevant documents and separate annual accounts in respect of the subsidiaries are available on the website of the Company and can be accessed at the web-link: https://www.mahindrafinance.com/annual-reports. aspx.

The annual accounts of the subsidiaries and related detailed information will also be available for inspection at the Registered Office of the Company during working hours upto the date of the Annual General Meeting.

DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND THE COMPANY''S OPERATIONS IN FUTURE There are no significant and material orders passed by the regulators or courts or tribunals that would impact the going concern status of the Company and its future operations.

DETAILS IN RESPECT OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS

Your Company has in place adequate internal financial controls with reference to financial statements, commensurate with the size, scale, and complexity of its operations. Your Company uses various industry-standard systems to enable, empower and engender businesses and also to maintain its Books of Account. The transactional controls built into these systems ensure appropriate segregation of duties, the appropriate level of approval mechanisms and maintenance of supporting records. The systems, Standard Operating Procedures and controls are reviewed by Management. These systems and controls are audited by Internal Audit and their findings and recommendations are reviewed by the Audit Committee and the IT Strategy Committee which ensures the implementation. Review of the internal financial controls environment of the Company was undertaken during the year which covered verification of entity-level control, process level control and IT controls, identification, assessment and definition of key business processes and analysis of risk control matrices, etc. The risk control matrices are reviewed on a yearly basis and control measures are tested and documented on a quarterly basis.

Reasonable Financial Controls are operative for all the business activities of the Company and no reportable material weakness or significant deficiencies in the design or operation of internal financial controls was observed.

Nonetheless your Company recognises that any internal control framework, no matter how well designed, has inherent limitations and accordingly, regular audits and review processes ensure that such systems are reinforced on an ongoing basis.

COMPLIANCE WITH THE PROVISIONS OF SECRETARIAL STANDARD - 1 AND SECRETARIAL STANDARD - 2

The Directors have devised proper systems to ensure compliance with the provisions of all applicable Secretarial Standards issued by the Institute of Company Secretaries of India and that such systems are adequate and operating effectively.

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.

PARTICULARS OF REMUNERATION AND RELATED DISCLOSURES

Disclosures with respect to the remuneration of Directors, Key Managerial Personnel and Employees as required under Section 197(12) of the Companies Act, 2013 and Rule 5(1) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, are as under:

Sr.

Disclosure Requirement

Disclosure Details

No.

Name of Director/ KMP

Designation

Ratio of the remuneration of each Director to median remuneration of employees

1.

Ratio of the remuneration of each Director to the median remuneration

Mr. Dhananjay Mungale

Chairman

(Independent Director)

11.23X

of the employees of the Company for the Financial Year 2018-19.

Mr M. G. Bhide**

Independent Director

9.42X

Mr. Piyush Mankad **

Independent Director

9.05X

Mr. C. B. Bhave

Independent Director

8.89X

Ms. Rama Bijapurkar

Independent Director

8.06X

Mr. V. S. Parthasarathy

Non-Executive Director

NIL*

Dr. Anish Shah

Non-Executive Director

NIL*

Mr. Ramesh Iyer

Vice-Chairman & Managing Director

220.22X

Mr. V. Ravi

Executive Director & Chief Financial Officer

86.70X

Ms. Arnavaz M. Pardiwalla

Company Secretary & Compliance Officer

24.53X

*Mr. V. S. Parthasarathy and Dr. Anish Shah do not receive any remuneration from the Company.

** resigned as Independent Directors of the Company w.e.f. the close of business hours on 31st March, 2019.

Disclosure Details

Sr. No. Disclosure Requirement

Name of Director/KMP

Designation

% increase in Remuneration

2. Percentage increase in Remuneration of each Director, Chief Financial Officer

Mr. Dhananjay Mungale

Chairman

(Independent Director)

8.96

and Company Secretary during the Financial Year 2018 -19.

Mr. M. G. Bhide**

Independent Director

10.47

Mr. Piyush Mankad**

Independent Director

10.53

Mr. C. B. Bhave

Independent Director

12.89

Ms. Rama Bijapurkar

Independent Director

10.08

Mr. V. S. Parthasarathy

Non-Executive Director

NIL*

Dr. Anish Shah

Non-Executive Director

NIL*

Mr. Ramesh Iyer

Vice-Chairman & Managing Director

19.93

Mr. V. Ravi

Executive Director & Chief Financial Officer

9.42

Ms. Arnavaz M. Pardiwalla

Company Secretary & Compliance Officer

33.15

* Mr. V. S. Parthasarathy and Dr. Anish Shah do not receive any remuneration from the Company.

** resigned as Independent Directors of the Company w.e.f. the close of business hours on 31st March, 2019.

3.

Percentage increase in the median Remuneration of employees in the Financial Year 2018-19

50.70% considering employees who were in employment for the whole of the Financial Year 2017-18 and Financial Year 2018-19.

4.

Number of Permanent employees on the rolls of the Company as on 31st March, 2019

21,789

5.

Average percentile increase already made in the salaries of employees other than the Managerial Personnel in the last Financial Year i.e. 201 8-1 9 and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration.

For employees other than Managerial Personnel who were in employment for the whole of the Financial Year 201718 and Financial Year 2018-19, the average increase is 51.75%.

Justification: The remuneration of the Vice-Chairman & Managing Director and Executive Director & Chief Financial Officer is decided based on the individual performance, inflation, prevailing industry trends and benchmarks.

The remuneration of eligible Non-Executive Directors consists of commission and sitting fees. While deciding the remuneration, various factors such as Director''s participation in Board and Committee Meetings during the year, other responsibilities undertaken, such as Membership or Chairmanship/ Chairpersonship of Committees, etc., were taken into consideration.

The increment given to each individual employee is based on the employees'' potential, experience as also their performance and contribution to the Company''s progress over a period of time and also benchmarked against a comparator basket of relevant companies in India.

6.

Affirmation that the remuneration is as per the Remuneration Policy of the Company.

The remuneration paid/payable is as per the Policy on Remuneration of Directors and Remuneration Policy for Key Managerial Personnel and Employees of the Company.

Notes:

1) The remuneration calculated is as per Section 2(78) of the Companies Act, 2013 and includes the perquisite value of Stock Options of the Company exercised during the year.

2) The calculations are based on Employees who were on the rolls of the Company for the whole of the Financial Year 2017-18 and Financial Year 2018-19.

Mr. Ramesh Iyer, Vice-Chairman & Managing Director and Mr. V. Ravi, Executive Director & Chief Financial Officer of the Company do not receive any remuneration or commission from its Holding Company. However, Mr. Iyer has been granted stock options under the Employees'' Stock Option Scheme of the Holding Company, Mahindra & Mahindra Limited. Mr. Iyer has not exercised ESOPs of the Holding Company, during the year, which were granted in the earlier year(s).

During the year under review, Mr. Ramesh Iyer and Mr. V. Ravi have not received any remuneration or commission from any of the subsidiaries of the Company.

During the year, 28,568 Stock Options have been exercised by Mr. Ramesh Iyer and 7,142 Stock Options have been exercised by Mr. V. Ravi, under the Employees'' Stock Option Scheme of Mahindra Rural Housing Finance Limited, the Company''s subsidiary company.

The Company had 16 employees who were in receipt of remuneration of not less than Rs. 1,02,00,000 during the year ended 31st March, 2019 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) and 5 (3) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are available at the Registered

Office of the Company during working hours, 21 days before the Annual General Meeting and shall be made available to any shareholder on request. Such details are also available on your Company''s website and can be accessed at the web-link: https://www. mahindrafinance.com/annual-reports.aspx. None of these employees is a relative of any Director of the Company.

None of the employees holds either by himself/herself or along with his/her spouse or dependent children, more than two per cent of the Equity Shares of the Company.

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

Your Company is an equal opportunity employer and is committed to ensuring that the work environment at all its locations is conducive to fair, safe and harmonious relations between employees. It strongly believes in upholding the dignity of all its employees, irrespective of their gender or seniority. Discrimination and harassment of any type are strictly prohibited.

The Company has in place an appropriate Policy in accordance with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, to prevent sexual harassment of its employees.

All employees (permanent, contractual, temporary and trainees) are covered under this Policy. The Policy has been widely communicated internally and is placed on the Company''s intranet portal. The Company ensures that no employee is disadvantaged by way of gender discrimination.

The Company has complied with the provisions relating to the constitution of Internal Complaints Committee (ICC) under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 to redress complaints received regarding sexual harassment.

The following is a summary of Sexual Harassment complaint(s) received and disposed off during the year 2018-19, pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and Rules framed thereunder:

a) Number of complaint(s) of Sexual Harassment received during the year - Nil

b) Number of complaint(s) disposed off during the year - Nil

c) Number of cases pending for more than 90 days -Nil

d) Number of workshops/awareness programmes against sexual harassment carried out - 3 workshops were conducted at the Company''s Corporate Office. Awareness on sexual harassment was carried out to sensitize employees of the Company at branches pan-India.

e) Nature of action taken by the employer or District Officer - Not Applicable.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars in respect of conservation of energy, technology absorption and foreign exchange earnings and outgo, as required under sub-section (3) (m) of Section 134 of the Companies Act, 2013 read with Rule (8)(3) of the Companies (Accounts) Rules, 2014 are given as under :

(A) Conservation of Energy

(i) The steps taken or impact on conservation of energy:

The operations of your Company are not energy intensive. However, adequate measures have been initiated to reduce energy consumption.

Select few steps are listed:

a) Replacement of conventional lighting with Light Emitting Diode (LED) lighting:

The Company has installed LED lighting in Regional Offices of the Company during the year under review and the same has been monitored in terms of electrical consumption and expenses.

b) Replacement of old air-conditioning with updated version of machines with R-410A gas, which helps in reducing Ozone depletion.

c) Reduction in water and energy consumption and recycling of waste generation at various locations.

(ii) The steps taken by the Company for utilising alternate sources of energy: Nil.

(iii) The capital investment on energy conservation equipments: Nil.

(B) Technology Absorption

(i) The efforts made towards technology absorption: Not Applicable.

(ii) The benefits derived like product improvement, cost reduction, product development or import substitution: Not

Applicable.

(iii) In case of imported technology (imported during the last three years reckoned from the beginning of the Financial Year): Not Applicable.

(a) Details of Technology Imported;

(b) Year of Import;

(c) Whether the Technology has been fully absorbed;

(d) if not fully absorbed, areas where absorption has not taken place, and the reasons thereof.

(iv) Your Company has not incurred any expenditure on Research and Development during the year under review.

(C) Foreign Exchange Earnings and Outgo

The information on foreign exchange outgo is furnished in the Notes to the Accounts. There were no foreign exchange earnings during the year.

For and on behalf of the Board

Dhananjay Mungale

Chairman

Place : Mumbai

Date : 24th April, 2019


Mar 31, 2018

Dear Shareholders

The Directors present their Report together with the audited financial statements of your Company for the year ended 31st March, 2018.

A. FINANCIAL AND OPERATIONAL HIGHLIGHTS

_(Rs. in crores)

Particulars

2018

2017

Revenue from Operations

49,445

47,384

Other Income

1,036

1,345

Profit before Depreciation, Finance Costs, Exceptional items and Taxation

7,259

5,861

Less: Depreciation, Amortisation and Impairment Expenses

1,479

1,526

Profit before Finance Costs, Exceptional items and Taxation

5,780

4,335

Less: Finance Costs

112

160

Profit before Exceptional items and Taxation

5,668

4,175

Add: Exceptional items

434

548

Profit before Taxation

6,102

4,723

Less: Tax Expense

1,746

1,080

Profit for the year

4,356

3,643

Balance of profit for earlier years

21,781

17,905

Less: Transfer to Debenture Redemption Reserve

14

14

Profits available for appropriation

26,123

21,534

Add: Due to Scheme of Arrangement

—

1,092

Add: Other Comprehensive Income/ (Loss) *

8

(3)

Less: Dividend paid on Equity Shares

807

745

Less: Income-tax on Dividend paid

118

96

Balance carried forward

25,206

21,781

* Remeasurement of (loss)/gain (net) on defined benefit plans, recognized as part of retained earnings.

In the year gone by, global growth and trade rebounded sharply and remained the story of the year. Such broad based and strong growth has not been seen since the world''s initial sharp 2010 bounce back, from the financial crisis of 2008-09. In the United States, fiscal policy even turned much more expansive as the Fed continued on its path of interest rate normalization. Other large Central Banks however, continued with their accommodative monetary stance. Global commodity prices, including crude oil, rallied significantly during the year.

On the domestic side, economic activity which flagged for five consecutive quarters, began to recover as several elements started coming together to nurture this nascent acceleration. This started manifesting in estimates and high frequency as well as survey-based indicators. A normal monsoon, record food grains output, strong sales growth by Corporations, depleting finished goods inventories and resilience in several services sectors raised the prospects of sustained economic recovery.

However, even amidst this scenario, your Company recorded an increase of 4.4% in revenue from operations at Rs. 49,445 crores in the year under review as against Rs. 47,384 crores in the previous year.

The Profit for the year before Depreciation, Finance Costs, Exceptional items and Taxation recorded an increase of 23.9% at Rs. 7,259 crores as against Rs. 5,861 crores in the previous year. Profit after tax increased by 19.6% at Rs. 4,356 crores as against Rs. 3,643 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.

No material changes and commitments have occurred after the closure of the Financial Year 2017-18 till the date of this Report, which would affect the financial position of your Company. There has been no change in the nature of business of your Company.

Performance Review

Automotive Sector:

Your Company''s Automotive Sector recorded total sales of 5,48,508 vehicles (4,90,870 four-wheelers and 57,638 three-wheelers) as against a total of 5,06,624 vehicles (4,52,893 four-wheelers and 53,731 three-wheelers) in the previous year, registering a growth of 8.3%.

In the domestic market, your Company sold a total of 5,20,286 vehicles as compared to 4,69,384 vehicles in the previous year, resulting in a growth of 10.8%.

In the Passenger Vehicle segment, your Company sold 2,48,859 vehicles [including 2,33,915 Utility Vehicles (UVs), 14,219 Vans and 725 Cars] registering a growth of 5.4%, as compared to the previous year''s volume of 2,36,130 vehicles [including 2,22,541 UVs, 10,370 Vans and 3,219 Cars].

In the Commercial Vehicle segment, your Company sold 2,16,802 vehicles [including 41,305 vehicles <2T GVW, 1,58,269 vehicles between 2-3.5T GVW, 7,744 LCVs in the LCV > 3.5T segment and 9,484 Heavy Commercial Vehicles (HCVs)] registering a growth of 19.8% over the previous year''s volume of 1,80,948 commercial vehicles [including 30,043 vehicles < 2T GVW, 1,36,564 vehicles between 2-3.5T GVW, 7,626 LCVs in the LCV > 3.5T segment and 6,715 HCVs].

In the Three-Wheeler segment, your Company sold 54,625 three wheelers, registering a growth of 4.4% over the previous year''s volume of 52,306 three wheelers.

For the year under review, the Indian automotive industry (except 2W) grew 11.9%, with the Passenger Vehicle (PV) industry growth of 7.9% and Commercial Vehicle (CV) industry growth of 19.9%. Three industry sub-segments where your Company has an active presence, posted very robust growth. These are Utility Vehicles (UV) which grew 21%, LCV Goods < 3.5T at 29.8% and MHCV Goods at 19.4%.

Your Company''s UV volume grew 5.1% to 2,33,915 units. The UV market share for your Company stood at 25.4% as against 29.2% in the previous year. Scorpio continues to strengthen its iconic status and recorded the highest ever sales with a volume of 53,934 units in Financial Year 2018. Bolero has been a very successful brand for your Company over the last 10 years, and for the year under review, Bolero along with the all New Bolero Power , posted combined sales of 85,386 units. Your Company strengthened the UV portfolio with the launch of the ''KUV100 NXT'' in October, 2017, the ''All Powerful Scorpio'' in November, 2017 and the ''Plush New XUV500'' in April, 2018.

Your Company is the pioneer for Electric Vehicles (EVs) in India, and for the year under review, sold [along with its subsidiary Mahindra Electric Mobility Limited] 4,026 EVs (1,094 four wheelers and 2,932 three wheelers) as against 1,021 EVs in the previous year. This growth is supported by the Government''s thrust on adopting EVs and your Company''s efforts of working with various stakeholders, especially fleet operators.

In the LCV<3.5T segment, your Company retained the No. 1 position with a 47.4% market share. Your Company sold a total of 1,99,544 vehicles in this segment, which is a growth of 19.8% over the previous year. The LCV<3.5T segment has two sub segments viz. LCV<2T and LCV 2-3.5T, which is the Pik-UP segment. Your Company has a market share of 25% and 61.9% in the two sub segments respectively.

In the HCV segment, your Company sold 9,484 trucks as against 6,715 trucks in the previous year. This is a growth of 41.2%. The growth is driven by good product performance, improved service reach and spares availability. The Blazo series of trucks which are backed by guarantees on mileage and service are instrumental in building brand and growing sales. Your Company''s market share in the HCV segment stands at 4.5%.

During the year under review, your Company posted an export volume of 28,222 vehicles as against the previous year''s record exports of 37,240 vehicles. This is a de-growth of 24.2%. This de-growth is principally due to adverse business and regulatory environment in key markets of Nepal and Sri Lanka. Sales in Africa grew 13%.

The spare parts sales for the year stood at Rs. 2,083.8 crores (including Exports of Rs. 193.4 crores) as compared to Rs. 1,937.2 crores (including Exports of Rs. 115.6 crores) in the previous year, registering a growth of 7.6%.

Farm Equipment Sector

Your Company''s Farm Equipment Sector recorded total sales of 3,17,531 tractors as against 2,63,177 tractors sold in the previous year thus recording a growth of 20.7%.

For the year under review, the tractor industry in India recorded sales of 7,09,308 tractors, a growth of 21.9%. Second consecutive year of normal monsoon, increase in MSPs and Government''s thrust on Agriculture and rural development, helped drive the positive sentiment in the Agriculture Sector and the rural economy at large.

In the domestic market, your Company sold 3,02,082 tractors, as compared to 2,48,594 tractors in the previous year, recording a growth of 21.5%. In a very competitive industry, your Company continued its market leadership for the 35th consecutive year, with a market share at 42.6%.

Your Company''s growth was driven by good performance of all products under the Mahindra and Swaraj Brands. The new product trio of Mahindra NOVO, YUVO and JIVO have helped build the ''technology leadership'' image for the Company. JIVO which was launched in Financial Year 2018, proved to be an ideal choice for farmers in the fast growing orchard and horticulture space.

For the year under review, Swaraj Division of your Company, launched the Swaraj 963 in the 60 HP segment. The Swaraj 963 and its variants, will help grow volume in the higher HP segment.

Further, your Company had developed and demonstrated technology for driverless tractors. First phase of this technology will be made available in the market in the Financial Year 2019. With this, your Company would take another pioneering step to revolutionize farming in India.

For the year under review, your Company exported 15,449 tractors registering a growth of 5.9% over the previous year. This is the highest ever tractor exports from India by your Company. There was growth in exports to USA and neighboring countries.

Your Company continued to strengthen its global footprint by further expanding into Turkey, through the acquisition of Erkunt Traktor Sanayii A.S. (Erkunt), the 4th largest tractor brand in Turkey. This is the second acquisition by your Company in Turkey after Hisarlar which is a farm equipment company.

Spare parts net sales for the year stood at Rs. 605.3 crores (including exports of Rs. 52.9 crores) as compared to Rs. 534.4 crores (including exports of Rs. 43.8 crores) in the previous year, registering a growth of 13.3%.

Other Businesses Mahindra Powerol

Under the Mahindra Powerol Brand, your Company has been a leader in providing power back-up solutions to the telecom industry for past 11 years. With a focus on changing customer needs, your Company has further expanded the business in Tele infra management and in the energy management solutions space.

In the retail genset business, your Company is the No. 2 brand by volume, and for the year under review, expanded the product range with the launch of gensets in the higher KVA range.

Construction Equipment Business

For the year under review, your Company (under the Mahindra Earth Master brand) sold 1,229 Backhoe Loaders (BHLs) against 1,025 in Financial Year 2017, which is a growth of 19.9%. With an uptick in infrastructure spending, the BHL market in India grew 23.5% over the previous year. Your Company ranks 4th in the BHL industry.

Your Company forayed into fast growing road construction equipment business with the launch of Motor Grader –Road Master G75, in October, 2017. Your Company sold 164 motor graders in Financial Year 2018.

Two-Wheeler Business

During the year under review, the two-wheeler business of Mahindra Two Wheelers Limited was demerged into your Company. For the Financial Year 2017-18, your Company sold 32,661 two-wheelers (including 17,912 exports).

Transitioning to Goods and Services Tax

Effective 1st July, 2017, India introduced the landmark tax reform with initiation of the Goods and Services Tax (GST) regime. All businesses of your Company, made a timely and seamless transition to the new GST system.

Current Year''s review

During the period 1st April, 2018 to 28th May, 2018, 72,813 vehicles were produced as against 62,615 vehicles and 67,244 vehicles were dispatched as against 59,361 vehicles during the corresponding period in the last year. During the same period 56,961 tractors were produced and 57,290 tractors dispatched as against 48,499 tractors produced and 48,210 tractors dispatched during the corresponding period in the previous year.

Economic activity is expected to gather pace in Financial Year 2019 as the transitory effects of implementation of the Goods and Service Tax (GST) recede. The Reserve Bank of India (RBI) projects India''s GDP growth to strengthen from 6.6 per cent in 2017-18 to 7.4 per cent in Financial Year 2019. The step-up in growth outlook is likely to be driven by a revival of investment on the demand side and manufacturing on the supply side. Credit off-take has also improved and is becoming increasingly broad-based, which augurs well for the underlying economic activity.

This outlook will also be lifted by tailwinds from normal rainfall with the weather bureau forecasting a ''normal'' monsoon for the third successive year in its first stage long range forecast. While the spatial and temporal distribution remain to be seen, well spread out rainfall is likely to have a salutary impact on the overall demand conditions. Moreover, the thrust on rural and infrastructure sectors imparted through the Union Budget could further help rejuvenate rural demand and also crowd in private investment.

Global growth backdrop too remains benign with a synchronized cyclical rebound. A boost to US investment demand from corporate tax cuts, strong activity in the Euro area supported by accommodative monetary policy and improvement in growth prospects of Emerging Market Economies (EMEs) have been supportive of this rebound thus far. However, escalation in trade frictions and protectionist policies, abrupt changes in the pace and timing of normalization of monetary policy of developed country central banks and higher crude oil prices could pose downside risks to global trade and demand growth.

Finance

Financial Year 2017-18 saw the broadest synchronized global growth since the financial crisis. World economy grew at 3.8% in 2017 up from 3.2% in 2016, on the back of growth in trade, pickup in investment particularly among advanced economies. US economy grew at a robust pace and is expected to continue on the back of tax reforms and associated fiscal stimulus. US Federal Reserve hiked interest rates by a cumulative of 75 bps during the Financial Year. Eurozone also saw a rebound in business sentiment and investments with still accommodative monetary policy, political uncertainties largely sorted and Brexit negotiations making progress. Despite some slowdown recently, Japan recorded eight consecutive quarters of growth up to December, 2017.

Economic activity also continued to expand in major emerging market economies such as Brazil, Russia and South Africa -driven by higher crude and commodity prices. China witnessed slight slowdown as it transitions from an export-driven to a domestic demand driven growth model, and saw a rating downgrade with warnings on its excessive debt levels.

The latest World Economic Outlook by IMF predicts global growth to pick up to 3.9% in 2018 supported by strong momentum, favorable market sentiment, accommodative financial conditions, and the domestic and international repercussions of expansionary fiscal policy in the United States. The key risks to the optimistic outlook are rising trade protectionism and geo-political uncertainties especially in the Middle-East.

On the domestic front the year began on a jubilant note with the Union Budget giving a strong thrust to the rural economy and a normal monsoon after two years of deficient rainfall. The much awaited Goods and Services Tax (GST) was rolled out on 1st July, 2017, replacing multiple taxes levied by Governments. Economic activity accelerated as is evident from high frequency indicators such as strong retail sales, depleting finished goods inventories and green shoots of renewal of capex cycle.

On the other hand, financial markets saw volatility on the back of US Fed tightening and rising crude prices. In addition, Banking Sector was also fraught with non-performing assets and frauds.

Indian Rupee which appreciated till the early part of January, 2018 on buoyant capital inflows, started depreciating subsequently over concerns of the impact of higher crude oil prices on India''s trade deficit and closed the year at Rs. 65.18 per USD.

CPI inflation remained benign during the first half of Financial Year 2018 which led to the Reserve Bank of India (RBI) to ease policy rates by 25 bps. However, inflation gradually started inching up in the second half of the year due to unfavorable base effect and rise in food and fuel inflation. Going forward there are various uncertainties on the inflation outlook primarily on account of impact of HRA increases by various State Governments, increase in MSP in Union Budget 2018, rising fuel and commodity prices and normalization of monetary policy by major advanced economies. Systemic liquidity, which had remained in surplus since demonetization, turned into deficit towards close of the year. Consequently, even though RBI remained in a pause mode since August, 2017, bond markets experienced rise in yields due to drying liquidity, concerns about inflation and the fiscal situation.

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 Rs. 80.69 crores of long term borrowings from internal accruals.

During the year, your Company also availed short term export finance. As on 31st March, 2018, Rs. 668 crores of export finance was outstanding, out of which Rs. 365 crores was under the interest equalization scheme of Government of India.

The Company''s 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 total Debt to Equity Ratio was 0.10 as at 31st March, 2018.

Your Company has been rated by CRISIL 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 Debenture (NCD) programme, CRISIL,

ICRA and India Ratings have re-affirmed their credit ratings of CRISIL AAA/Stable, [ICRA]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.

Investor Relations (IR)

Your Company continuously strives for excellence in its IR engagement with International and Domestic investors and has set up feedback mechanism to measure IR effectiveness. Structured conference calls and periodic investor/analyst interactions including one-on-one meeting, participation in investor conferences, quarterly earnings calls and annual analyst meet with the Chairman, Managing Director and Business Heads were organized during the year.

Your Company interacted with around 670 Indian and overseas investors and analysts (excluding quarterly earnings calls and specific event related calls) during the year. Your Company always believes in leading from the front with emerging best practices in IR and building a relationship of mutual understanding with investor/analysts. As a key milestone in this continuing Endeavour, your Company created a digital interactive annual review of the Company''s performance on the Corporate website to provide an interactive experience beyond what is available in the Annual Report. The Company had created its first Integrated Report (for Financial Year 2017). Your Company also continues to organize con-call on Environment, Social and Corporate Governance (ESG) for analysts and investors, which has received excellent feedback from investors and ESG analysts for this pioneering initiative.

Your Company ensures that critical information about the Company is available to all the investors by uploading all such information at the Company''s website. Your Company has created a ''Group Investor Relations Council'' to share best practices across all the listed group companies and learn from each other.

Issue of Shares

(a) Scheme of Arrangement between Mahindra Two Wheelers Limited and Mahindra and Mahindra Limited and their respective Shareholders and Creditors (Scheme)

Your Company on 8th November, 2017 allotted 5,03,888 Ordinary (Equity) Shares of Rs. 5 each to the Shareholders of Mahindra Two Wheelers Limited (other than the Company) pursuant to the Scheme.

(b) Bonus Shares

Pursuant to the recommendation of the Board of Directors at its Meeting held on 10th November, 2017 and approval of the Members of the Company through a Postal Ballot, the Results of which were declared on 16th December, 2017, your Company has on 26th December, 2017 allotted 62,15,96,272 Ordinary (Equity) Shares of Rs. 5 each as fully paid-up Bonus Shares in the ratio of one Bonus Share for every one existing Equity Share of the Company held by the Shareholders as on the Record Date i.e. 23rd December, 2017.

Consequently, the paid-up Equity Share Capital of the Company increased to Rs. 621,59,62,720 divided into 124,31,92,544 Ordinary (Equity) Shares of Rs. 5 each, fully paid-up.

Dividend

Your Directors are pleased to recommend a dividend of Rs. 7.50 per Ordinary (Equity) Share of the face value of Rs. 5 each on the enhanced Share Capital, payable to those Shareholders whose names appear in the Register of Members as on the Book Closure Date. The equity dividend outgo for the Financial Year 2017-18, inclusive of tax on distributed profits (after reducing the tax on distributed profits of Rs. 69.52 crores on the dividends declared by subsidiaries as of the date of this report and receivable during the current Financial Year 2018-19) would absorb a sum of Rs. 1,054.53 crores [as against Rs. 927.62 crores comprising the dividend of Rs. 13 per Ordinary (Equity) Share of the face value of Rs. 5 each and tax thereon paid for the previous year]. Further, the Board of your Company decided not to transfer any amount to the General Reserve for the year under review.

The dividend pay-out is in accordance with the Company''s Dividend Distribution Policy.

Dividend Distribution Policy

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

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 Financial Statements as stated above are also available on the website of the Company and can be accessed at the Web-link: http://www.mahindra.com/resources/investor-reports/ FY18/Annual Reports/Links-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, has reported a consolidated revenue of Rs. 30,773 crores in the current year as compared to Rs. 29,141 crores in the previous year, an increase of 6%. Its consolidated profit after tax is Rs. 3,800 crores as compared to Rs. 2,813 crores in the previous year, an increase of 35%.

The Group''s finance company, Mahindra & Mahindra Financial Services Limited (Mahindra Finance), reported a consolidated operating income of Rs. 8,533 crores during the current year as compared to Rs. 7,146 crores in the previous year, a growth of 19%. The consolidated profit after tax for the year is Rs. 1,024 crores as compared to Rs. 512 crores in the previous year.

Mahindra Finance financials is as per Indian Generally Accepted Accounting Principles (IGAAP).

Mahindra Life space Developers Limited, the subsidiary in the business of real estate and infrastructure registered a consolidated operating income of Rs. 566 crores as compared to Rs. 762 crores in the previous year. The consolidated profit after tax for the year is Rs. 101 crores as compared to Rs. 102 crores in the previous year.

Mahindra Holidays & Resorts India Limited, the subsidiary in the business of timeshare registered a consolidated operating income of Rs. 2,317 crores as compared to Rs. 2,267 crores in the previous year, an increase of 2%. The consolidated profit after tax for the year is Rs. 132 crores as compared to Rs. 149 crores in the previous year.

Mahindra Logistics Limited, a listed subsidiary in the logistics business has registered a consolidated operating income of Rs. 3,416 crores as compared to Rs. 2,667 crores in the previous year, an increase of 28%. The consolidated profit after tax for the year is Rs. 64 crores as compared to Rs. 46 crores in the previous year, an increase of 39%.

Ssyangyong Motor Company, the Korean subsidiary of the Company has reported consolidated revenues of Rs. 20,435 crores in the current fiscal year as compared to Rs. 21,153 crores in the previous year. The consolidated loss for the year is Rs. 502 crores as compared to consolidated profit after tax of Rs. 245 crores in the previous year.

The consolidated group profit before exceptional item and tax for the year is Rs. 6,590 crores as against Rs. 5,004 crores in the previous year - a growth of 32%. The consolidated profit after tax after non-controlling interest and exceptional items for the year is Rs. 7,510 crores as against Rs. 3,698 crores in the previous year.

During the year under review, Mahindra Automotive North America Inc., Merakisan Private Limited, Mahindra Vehicle Sales and Services Inc., Mahindra Waste Energy Solutions Limited, Mahindra Telecom Energy Management Services Limited, Mahindra Happinest Developers Private Limited, Mahindra Fresh Fruits Distribution Holding Company (Europe) B.V., Erkunt Traktor Sanayii A.S., Erkunt Sanayi A.S., Deep Mangal Developers Private Limited, Moonshine Construction Private Limited, Mahindra Construction Company Limited, Visionsbolaget 12191 AB and Visionsbolaget 12192 AB became subsidiaries of your Company.

During the year under review, Mahindra Yueda (Yancheng) Tractor Company Limited, Defence Land Systems India Limited, Raigad Industrial & Business Park Limited, Mahindra Telecommunications Investment Private Limited, Gateway Housing Company Limited and Visionsbolaget 12192 AB ceased to be subsidiaries of your Company.

Subsequent to the year end, Mahindra Susten Bangladesh Private Limited and Blitz 18-371 GmbH became subsidiaries of your Company and Gipp Aero Investments Pty Limited and Aerostaff Australia Pty Limited ceased to be subsidiaries of your Company.

Pursuant to the Ministry of Corporate Affairs Notification dated 7th May, 2018, the amendment to the definition of "subsidiary company" was made effective and thereby

Mahindra Knowledge Park Mohali Limited became a subsidiary of your Company and Merakisan Private Limited ceased to be a subsidiary of your Company.

During the year under review, Mahindra Waste Energy Solutions Limited changed its name to Mahindra Waste To Energy Solutions Limited, Mahindra Gujarat Tractor Limited changed its name to Gromax Agri Equipment Limited, Mahindra Suryaurja Private Limited changed its name to Mega Suryaurja Private Limited and Visionsbolaget 12191 AB changed its name to Are Villa 3 AB.

During the year under review, Mahindra Happinest Developers Private Limited and Mahindra Defence Naval Systems Private Limited were converted into Public Limited Companies and accordingly, their names were changed to Mahindra Happinest Developers Limited and Mahindra Defence Naval Systems Limited.

Subsequent to the year end, Mahindra Retail Private Limited was converted into a Public Limited Company and accordingly changed its name to Mahindra Retail Limited. Further, Blitz 18-371 GmbH changed its name to Automobile Pininfarina GmbH and Industrial Cluster Private Limited changed its name to Mahindra Industrial Park Private Limited.

During the year under review, M.I.T.R.A Agro Equipments Private Limited, ZoomCar Inc, Carnot Technologies Private Limited and Resfeber Labs Private Limited became Associates of your Company and subsequent to the year end, Merakisan Private Limited became Associate of your Company.

A Report on the performance and financial position of each of the subsidiaries, associates and joint venture companies included in the Consolidated Financial Statement 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 at the Web-link: http://www.mahindra.com/resources/ investor-reports/FY18/Annual Reports/Links-AnnualReport.zip

C. JOINT VENTURES, ACQUISITIONS AND OTHER MATTERS

Demerger of Two-Wheeler Business of Mahindra Two Wheelers Limited (MTWL) into your Company

MTWL, a step down subsidiary of your Company, has been engaged in the businesses of design, manufacture, sales and service of two wheelers (Two-Wheeler Business) and also trading in spares and accessories for two wheelers. A Scheme of Arrangement between MTWL and your Company and their respective Shareholders and Creditors (Scheme) was announced by your Company to demerge the Two Wheeler Business into your Company. The appointed date of the Scheme was 1st October, 2016. The National Company Law Tribunal approved the Scheme and the Scheme has been made effective from 25th October, 2017.

In accordance with the Scheme, your Company has allotted 4,63,287 Ordinary (Equity) Shares of Rs. 5 each to Aay Kay Global and 40,601 Ordinary (Equity) Shares of Rs. 5 each to Emerging India Fund, the Shareholders of MTWL, in the share exchange ratio of 1 fully paid-up Ordinary (Equity) Share of Rs. 5 each of the Company for every 461 fully paid-up shares held in MTWL.

Divestment of 87,211 Equity Shares of Swaraj Engines Limited in the Buy-back offer

During this year, Swaraj Engines Limited (SEL), an associate company of your Company, had come up with a Buy-Back Offer (Offer). Your Company successfully offered 87,211 Equity Shares of SEL in the Offer. Your Company booked a profit of approximately Rs. 21 crores in the process. Following this Offer, the shareholding of your Company has marginally increased from 33.22% to 33.31% of SEL''s share capital.

Sale of 64,50,000 shares representing 5% of the total share capital of CIE Automotive S.A

During the year, Mahindra Overseas Investment Company (Mauritius) Limited (MOICML), a wholly owned subsidiary of the Company, executed a sale of 64,50,000 shares representing 5% of the share capital of CIE Automotive S.A at a price of Euro 23.5 per share, aggregating to Euro 151.58 million on the Spanish Stock Exchange. The post-tax capital gains booked by MOICML is Euro 91.4 million.

Post the sale, MOICML''s shareholding in CIE Automotive S.A has come down to 7.435% of its share capital. This transaction has facilitated diversification of the investor base of CIE Automotive S.A.

Scheme of Amalgamation between Defence Land Systems India Limited (Transferor Company) and Mahindra Defence Systems Limited (Transferee Company) and their respective Shareholders and Creditors (Scheme)

The National Company Law Tribunal has approved the Scheme vide its order dated 5th October, 2017. The appointed date of the Scheme is 1st January, 2017 and the Scheme is effective from 18th October, 2017.

Initial Public Offer of Mahindra Logistics Limited

During this year, Mahindra Logistics Limited (MLL), a subsidiary of your Company, successfully completed an Initial Public Offer (IPO) with an issue size of Rs. 829 crores. As a part of this IPO, your Company sold 96,66,173 Equity Shares of MLL, amounting to 13.6% stake. The offer was oversubscribed nearly by 8 times and the allotment took place at the upper end of the price band of Rs. 425-429 per share. The Equity Shares of MLL got listed on BSE Limited and National Stock Exchange of India Limited (NSE) on 10th November, 2017.

This was the largest IPO from your Company till date and as a result of this secondary sale during the IPO, your Company has realized gross proceeds of Rs. 414 crores and booked profit of Rs. 386 crores, thereby unlocking substantial value creation for the shareholders. Your Company''s shareholding in MLL stood at 58.8% on completion of the IPO. The Equity Shares of MLL traded at closing price of Rs. 484.80 per share on NSE on the last trading day of the fiscal year ended on 31st March, 2018.

Consolidation of Smart shift and Porter

Orizonte Business Solutions Limited (Smart shift) is a step down subsidiary of your Company which owns and operates a technology enabled load exchange marketplace platform for matching the needs of cargo owners with transporters. Mahindra Trucks & Buses Limited (MTBL), a wholly owned subsidiary of your Company held a 10.37% stake on a fully diluted basis in Resfeber Labs Private Limited (Porter) which is a similar business to that of Smart shift. To leverage synergies and obtain greater economies of scale for both businesses, your Company agreed to a Scheme to merge Smart shift and Porter.

As a part of this strategy, on 23rd February, 2018, your Company executed a Share Subscription Agreement and Shareholders Agreement which entailed a commitment to merge Smart shift with Porter through a Scheme of Merger and make an investment of approximately Rs. 65 crores in Porter and Smart shift. As on date, your Company has made the aforesaid investment in Smart shift and Porter. Additionally, the aforementioned Scheme of Merger was also approved by the Board of Directors of Smart shift and Porter and was filed before the National Company Law Tribunal (NCLT), Mumbai Bench on 5th April, 2018. Pursuant to the merger, which is subject to the NCLT approval, Smart shift will cease to be a subsidiary of the Company.

Post merger, the shareholding of your Company and its subsidiaries in Porter (the combined entity) taken on a fully diluted basis would be 30.9% for the Company, 2.5% for Mahindra & Mahindra Financial Services Limited and 7% for MTBL.

Investment in Zoomcar

Your Company has been keen to invest in the shared mobility space as part of its strategy to promote and participate in sustainable mobility solutions, including multi modal urban mobility, with the objective of enabling improved livelihoods and lifestyles of people enabling them to RISE. As a part of your Company''s strategy of promoting Electric Vehicles and shared mobility, your Company invested in Zoomcar India Private Limited (Zoomcar India) which is a leading self-drive car rental company based out of Bangalore, India and had been 100% owned by Zoomcar Inc., a holding company incorporated in the USA. Your Company subscribed to Compulsory Convertible Preference Shares (CCPS) of Zoomcar India, which on an as-converted to Equity Share basis, would result in the Company holding about 11.6% of the Equity Share Capital of Zoomcar India on a fully diluted basis. Subject to receipt of regulatory approvals, the Company shall exchange its CCPS holding of Zoomcar India for Preferred Stock of Zoomcar Inc. at a future date. Mahindra Overseas Investment Company (Mauritius) Limited (MOICML), a wholly owned subsidiary of the Company, has also invested in Zoomcar Inc.

The effect of this investment, by your Company and MOICML, on an aggregate as-converted to common stock of Zoomcar Inc. basis would result in your Company and MOICML together holding approximately 16% of the Common Stock of Zoomcar Inc. on a fully diluted basis.

Exploration of Strategic Co-operation with Ford

During the year, your Company announced its intent of exploring a strategic alliance with Ford Motor Company (Ford) which is designed to leverage the benefits of Ford''s global reach and expertise and your Company''s scale in India and its successful operational model to allow each company to leverage the others'' strengths during a period of unprecedented transformation in the global automotive industry. To that end the Company signed several MOUs with Ford during the year which included an overall co-operation plan agreement and the others being in specific areas of connected vehicle projects, battery electric vehicle, power trains and product development of mid-size and compact SUV.

Acquisition of Erkunt Traktor Sanayii A.S. and Erkunt Sanayi A.S.

During the year, your Company strengthened its presence in Turkey by acquiring Erkunt Traktor Sanayii A.S. (Erkunt Tractor) and Erkunt Sanayi A.S. (Erkunt Sanayi). Erkunt Tractor is the 4th largest tractor company in Turkey, and Erkunt Sanayi is a leading casting and machining company catering to tractor and other industrial machinery. Mahindra Overseas Investment Company (Mauritius) Limited, a wholly owned subsidiary of your Company, acquired 100% of Erkunt Tractor and 98.7% of Erkunt Sanayi, for approximately Rs. 450 crores. These acquisitions, along with investment in Hisarlar Makina in Financial Year 2017, provide a strong base for your Company to participate in the Turkish agri-machinery market which is among the largest globally.

Investment in M.I.T.R.A. Agro Equipment Private Limited

Your Company invested Rs. 8 crores in Equity Shares of M.I.T.R.A Agro Equipment Private Limited (MITRA) during the year. MITRA is an Indian agri-machinery company, specialising in equipment such as sprayers for horticulture. Your Company now has a 26% equity stake, on fully diluted basis, in MITRA. The partnership with MITRA will enable your Company to expand and strengthen its presence in the horticulture segment which is fast growing.

Investment in Carnot Technologies Private Limited

During the year, your Company invested approximately Rs. 6.1 crores in Carnot Technologies Private Limited (Carnot), a startup founded in 2015 by purchasing existing Equity Shares and subscribing to Series A Convertible Preference Shares. Your Company now owns approximately 23% of the fully diluted equity capital of Carnot. Carnot provides Internet of Things (IoT) products and solutions for automobiles currently and your Company intends to partner with Carnot to develop innovative technology solutions and accessories to supplement and enhance the value of its product and service offerings across segments.

Launch of ROXOR by Group company MANA in the US

Mahindra Automotive North America (MANA), a second level subsidiary of your Company launched ROXOR, a new Off-Road vehicle in the power sports segment in March, 2018. ROXOR was conceived, designed, engineered and is being produced in Metro Detroit by MANA which recently opened a new North American Automotive Headquarter and manufacturing center in the US.

Waste to Energy Solutions

During the year, your Company incorporated Mahindra Waste To Energy Solutions Limited (MWESL) as a new subsidiary to carry out activities in relation to conversion of organic wastes to energy. Currently there are multiple locations across India where projects at different operational stages are being executed. In February, 2018, MWESL executed an MOU with Indraprastha Gas Limited (IGL) for providing sustainable solutions to waste management and stubble burning through design and development of bio-gas plants which will use agro and other organic waste in the region where IGL operates.

Merger of Mahindra Telecommunications Investment Private Limited and Gateway Housing Company Limited (Transferor Companies) with Mahindra Holdings Limited (Transferee Company) and their respective Shareholders (Scheme)

The National Company Law Tribunal has approved the Scheme vide its order dated 4th January, 2018. The appointed date of the Scheme is 1st April, 2016 and the Scheme is effective from 27th February, 2018.

Capital Raising by Mahindra & Mahindra Financial Services Limited, a listed subsidiary of your Company

During the year under review, Mahindra & Mahindra Financial Services Limited (MMFSL), a listed subsidiary of your Company had received the approval of its shareholders to issue up to 2.5 crores shares by way of Preferential Allotment to your Company and up to 2.4 crores shares by way of Qualified Institutions Placement (QIP). MMFSL had successfully raised a total of Rs. 2,111 crores through the above issuances made to both the Company (Rs. 1,055 crores) and a mix of domestic and international qualified institutional bidders (Rs. 1,056 crores).

With your Company maintaining majority shareholding of 51.19%, MMFSL continues to benefit by leveraging the financial and operational synergies with the Company and with the simultaneous QIP issuance, it has been able to diversify its investor base. MMFSL''s Capital Adequacy has strengthened with this capital raise. It further enables MMFSL to augment its long term resources to enable it to meet its business growth and funding requirements as well as meet the investment required to be made in its subsidiaries and joint ventures.

D. INTERNAL FINANCIAL CONTROLS

The Corporate Governance Policies guide the conduct of affairs of your Company and clearly delineates 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 Information Management Policy reinforces the control environment. The systems, Standard Operating Procedures and controls are reviewed by Management. These systems and controls are audited by Internal Audit and their findings and recommendations are reviewed by the Audit Committee which ensures the implementation.

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. This year 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 Management, no reportable material weakness or significant deficiencies in the design or operation of internal financial controls was observed.

Your Company recognizes 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 Control 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. CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All Related Party Transactions entered during the year were in the ordinary course of business and on arms length basis. During the year under review, your Company had entered into Material Related Party Transactions, i.e. transactions exceeding ten percent of the annual consolidated turnover as per the last audited financial statements, with Mahindra Vehicle Manufacturers Limited, a wholly owned subsidiary of your Company. These transactions too were in the ordinary course of business of your Company and were on arms length basis, details of which, as required to be provided under section 134(3)(h) of the Companies Act, 2013 are disclosed in Form AOC-2 as Annexure II and 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 at the Web-link: http://www.mahindra.com/resources/investor-reports/FY18/ Annual Reports/Links-AnnualReport.zip

G. AUDITORS

Statutory Auditors and Auditors'' Report

Messrs B S R & Co. LLP, Chartered Accountants (ICAI Firm Registration Number 101248W/W-100022) were appointed as the Statutory Auditors of the Company to hold office for a term of 5 years from the conclusion of the 71st Annual General Meeting (AGM) held on 4th August, 2017 until the conclusion of the 76th AGM of the Company to be held in the year 2022.

Pursuant to the Notification issued by the Ministry of Corporate Affairs on 7th May, 2018, amending section 139 of the Companies Act, 2013, the mandatory requirement for ratification of appointment of Auditors by the Members at every AGM has been omitted and hence your Company has not proposed ratification of appointment of Messrs B S R & Co. LLP, Chartered Accountants, at the forthcoming AGM.

The Auditors'' Report 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 Report as Annexure III, a Secretarial Audit Report given by the Secretarial Auditor.

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

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 2017-18.

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 2018-19 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 arms 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.

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, details of which needs to be mentioned in this Report.

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. 6 and 36 to the Financial Statements.

I. PUBLIC DEPOSITS AND LOANS/ADVANCES

Your Company had discontinued its Fixed Deposit Scheme for 36 months with effect from the close of office hours on 31st January, 2014 and has also discontinued acceptance of Fixed Deposits with effect from 1st April, 2014.

All the deposits from public and Shareholders had already matured as at 31st March, 2017. Out of the total outstanding 64 deposits of Rs. 50.11 lakhs from the public and shareholders as at 31st March, 2018, all deposits amounting to Rs. 50.11 lakhs, had matured and had not been claimed as at the end of the Financial Year. Since then 3 of these deposits of the value of Rs. 1.55 lakhs 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, etc., required to be disclosed in the Annual Accounts of the Company pursuant to Para A of Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 are furnished separately.

J. EMPLOYEES

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) Mr. Anand G. Mahindra - Executive Chairman

(b) Dr. Pawan Goenka - Managing Director

(c) Mr. V S Parthasarathy - Group CFO & Group CIO

(d) Mr. Narayan Shankar - Company Secretary

There has been no change in the KMPs during the year under review.

Employees'' Stock Option Scheme

During the year under review, on the recommendation of the Governance, Nomination and Remuneration Committee 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.

The Company has in force the following Schemes which get covered under the provisions of SEBI (Share Based Employee Benefits) Regulations, 2014 (SBEB Regulations):

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

There are no material changes made to the above Schemes and these Schemes are in compliance with the SBEB Regulations. Your Company''s Auditors, Messrs B S R & Co. LLP, have certified that the Company''s above-mentioned Schemes have been implemented in accordance with the SBEB Regulations, and the Resolutions passed by the Members for the 2000 Scheme and the 2010 Scheme.

Information as required under the SBEB Regulations read with SEBI Circular CIR/CFD/POLICY CELL/2/2015 dated 16th June, 2015 have been uploaded on the Company''s website and can be accessed at the Web-link: http://www.mahindra.com/resources/ investor-reports/FY18/Annual Reports/Links-AnnualReport.zip

Particulars of Employees and related disclosures

The Company had 296 employees who were in receipt of remuneration of not less than Rs. 1,02,00,000 during the year ended 31st March, 2018 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 Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are available at the Registered Office of the Company during working hours, 21 days before the Annual General Meeting and shall be made available to any Shareholder on request. Such details are also available on your Company''s website and can be accessed at the Web-link: http://www.mahindra.com/resources/investor-reports/FY18/Annual Reports/Links-AnnualReport.zip

Disclosures with respect to the remuneration of Directors, 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 IV 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, which aims to create an engaged workforce with an innovative, productive and competitive shop-floor ecosystem, continues to grow in strength. The Transformational Work Culture Committee (TWCC) continually engages with long-term strategic initiatives which range from anticipated Labour Law reforms to ''Swachh Bharat Abhiyaan''. Some examples of the programs put in place include ''Rise for Associates'', Industrial Relations Skills for Frontline Officers, Cultural Diagnostics Projects, Transformational work culture Projects, e-Compliance, e-Quizz for associates, e-portal for reward and recognition of associates, e-safety module and Code of Conduct for Associates. Some of the programs are run in collaboration with Mahindra Leadership University (MLU).

In order to develop skills and foster togetherness at the workplace, your Company rolled out multiple training and engagement programs covering a wide range of topics, viz. positive attitude, stress management, creativity, team effectiveness, safety and environment, quality tools, TPM, skill building programs, customer focus, awareness on Promise 2019, Code of Conduct and a Union Leadership Development Program.

The Mahindra Skill Excellence initiative is a holistic approach to enhance the skill and capabilities of shop floor associates, and has received good participation across manufacturing facilities. As a result of this effort, an associate from your Company represented India at the Worlds Skill Competition in Abu Dhabi in August, 2017 and the ''Beijing Arc Cup Competition'' for third year in a row.

In an endeavor to generate ideas towards improving quality, reducing cost, ensuring safety and improving productivity, your Company''s shop floor associates generated on an average 20 ideas per person.

Significant emphasis was also laid towards raising awareness on health and wellness of employees through annual medical check-ups, health awareness activities, and diet food has become a way of life over past three years. Your Company maintains an ''Employee Health Index'' at an individual level and this has been a useful tool in identifying employees who require focused counseling 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 Manufacturing locations. Bonus settlements were amicably agreed upon at all locations.

The sustained efforts towards building a transformational work culture resulted in zero production loss in the Financial Year 2017-18 and helped create a collaborative, healthy and productive work environment.

Safety, Occupational Health and Environment

During the year under review, your Company revised its Safety, Occupational Health & Environmental (SOH&E) Policy. The leadership''s commitment towards SOH&E, is demonstrated through inclusion of compliance as well as voluntary commitments in the revised policy. SOH&E targets have been set as per the revised policy. Implementation of various initiatives under the policy and achievement of set targets were assessed through audits (both internal and external) and management reviews.

At each Plant location, annual events were organized and commemorated like National Safety Day/Month, World

Environment Day, Road Safety Week and Fire Service Week. Training programs were conducted for all stakeholders as per the scheduled training calendar through various physical and e-learning modules. In the year under review, your Company completed second batch of Accelerated Learning Program (ALP) on safety, to encourage innovations and best practices related to SOH&E. To strengthen the safety culture, Behaviour Based Safety (BBS) - Level 2 has been introduced at all plants.

Your Company carried out statutory safety audits including electrical safety audits of all facilities, as per the amended legal requirements. For the year under review, your Company achieved substantial reduction in the fire load at all the manufacturing plants.

Your Company continued its commitment to improve the wellbeing of employees and contract associates through various activities under project Parivartan like organizing physical fitness activities including Walkathon, Yoga, Zumba, medical checkups, health consultation and counseling. Further, all locations observed World Health Day, World Heart Day, World Kidney Day and World Diabetes Day. Way2Wellness sessions were conducted covering topics like Healthy Heart and Diabetic feet.

In line with the ''Go Green'' philosophy, your Company is continuously adopting new techniques to eliminate and minimize the environmental impact. Various projects have been implemented by your Company in air, water and waste water management and solid waste management. These initiatives are also extended to the supplier community of your Company.

Your Company has adopted Global Reporting Initiative (GRI) -G4 Guidelines, and has undertaken projects aimed at climate change mitigation, sustainable source use and protection of bio-diversity. Some examples of successful initiatives are LED lighting project, Energy efficiency Motors, Solar power installation and certified green building projects with platinum and gold rated facilities.

In addition to above, World Ozone Day, World Environment Day, No Print Day, World Earth Day, World Water Day and Energy Conservation Week and Water Conservation Week are also observed on an annual basis.

Certifications/Recertification’s

All Plants of your Company have been recertified under standard ISO 14001: 2015 and OHSAS 18001: 2007. Further, all plants are in the process of implementing, integrated management system along with adopting the revised environmental standard ISO 14001: 2015.

In March, 2018, all seven plants of Automotive Sector were awarded TPM excellence award, by Japanese Institute of Plant Maintenance (JIPM). In April, 2018, five Plants of your Company also received certification for "Zero Waste to Landfill" from Intertek USA.

The Company has revised its targets under SOH&E policy and these targets are reviewed periodically by senior management. The focused initiatives and reviews have helped to improve SOH&E performance of your Company in the period 2017-18.

K. BOARD & COMMITTEES Directors

As mentioned in the previous Annual Report, Mr. Deepak S. Parekh ceased to hold office as an Independent Director of the Company from 8th August, 2017, upon completion of his tenure as approved by the Shareholders at the 68th Annual General Meeting. Further, Mr. T. N. Manoharan was appointed at the 71st Annual General Meeting held on 4th August, 2017 as an Independent and Non-Executive Director of the Company for a period of 5 consecutive years commencing from 11th November, 2016 to 10th November, 2021.

Mr. Anand Mahindra retires by rotation and, being eligible, offers himself for re-appointment at the 72nd Annual General Meeting (AGM) of the Company scheduled to be held on 7th August, 2018.

The Company has received an intimation from Life Insurance Corporation of India informing that Mr. S. B. Mainak has resigned from the Board of the Company. Accordingly, Mr. S. B. Mainak ceased to be a Director of the Company with effect from 11th May, 2018.

The Board places on record its sincere appreciation of the valuable services rendered by Mr. S. B. Mainak during his tenure as a Director of the Company.

The Governance, Nomination and Remuneration Committee, on the basis of performance evaluation of Independent Directors and taking into account the external business environment, the business knowledge, acumen, experience and the substantial contribution made by Mr. M. M. Murugappan and Mr. Nadir B. Godrej during their tenure, has recommended to the Board that continued association of Mr. M. M. Murugappan and Mr. Nadir B. Godrej as Independent Directors of the Company would be beneficial to the Company. Based on the above and the performance evaluation of Independent Directors, the Board recommends re-appointment of Mr. M. M. Murugappan and

Mr. Nadir B. Godrej, as Independent Directors of the Company, not liable to retire by rotation, to hold office for a second term of 2 (two) consecutive years on the Board of the Company. The Company has received the requisite Notices from a Member in writing proposing their appointment as 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 SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Pursuant to the provisions of the Companies Act, 2013, and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has carried out an annual evaluation of its own performance and that of its Committees as well as performance of the Directors individually. 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.

A separate exercise was carried out by the Governance, Nomination and Remuneration Committee 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 Executive Chairman of the Company was also carried out by the Independent Directors, taking into account the views of the Managing Director and Non-Executive Directors. The Directors expressed their satisfaction with the evaluation process. The Independent Directors and Executive Chairman also carried out performance evaluation of the Managing Director of the Company.

The details of programs for familiarization of the Independent Directors with the Company, their roles, rights, responsibilities in the Company, nature of the industry in which the Company operates, business model of the Company, number of programs and number of hours spent by each Independent Director in terms of the requirements of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 are available on the Company''s website and can be accessed at the following Weblink: http://www.mahindra.com/resources/investor-reports/FY18/Annual Reports/Links-AnnualReport.zip

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.

The Policies mentioned at (a) and (b) above are attached as Annexure V-A and V-B respectively and form part of this Report.

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 31st March, 2018, 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 31st March, 2018 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 31st March, 2018;

(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 31st March, 2018.

Board Meetings and Annual General Meeting

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

During the year 1st April, 2017 to 31st March, 2018, eight Board Meetings were held on: 30th May, 2017, 13th June, 2017, 4th August, 2017, 9th October, 2017, 10th November, 2017, 13th December, 2017, 9th February, 2018 and 28th March, 2018. The 71st Annual General Meeting (AGM) of the Company was held on 4th August, 2017.

Meetings of Independent Directors

The Independent Directors of your Company meet before the Board Meetings without the presence of the Executive Chairman or the Managing Director or other Non-Independent Director 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 Executive Chairman of the Company (taking into account the views of the Executive and Non-Executive Directors), review the performance of the Company, 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 Board at its Meeting held on 4th August, 2017 re-constituted the Audit Committee and appointed Mr. T. N. Manoharan as the Chairman with effect from 8th August, 2017. The Committee comprises of four Directors viz. Mr. T. N. Manoharan (Chairman of the Committee), Mr. Nadir B. Godrej, Mr. M. M. Murugappan and Mr. R. K. Kulkarni. 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.

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

L. GOVERNANCE 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. 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 SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 forms part of the Annual Report.

Vigil Mechanism

The Vigil Mechanism as envisaged in the Companies Act, 2013, the Rules prescribed there under and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is implemented through the Company''s Whistle Blower Policy to enable the Directors, employees and all stakeholders of the Company to report genuine concerns, to provide for adequate safeguards against victimization of persons who use such mechanism and make provision for direct access to the Chairman of the Audit Committee.

Whistle Blower Policy of your Company is available on the

Company''s website and can be accessed at the Web-link:

http://www.mahindra.com/resources/investor-reports/FY18/

Annual Reports/Links-AnnualReport.zip

Further details are available in the Report on Corporate

Governance that forms part of this Annual Report.

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

The Company has in place an Anti-Sexual Harassment Policy in line with the requirements of The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this Policy. The Policy is gender neutral. During the year under review, 1 complaint with allegations of sexual harassment was filed, which was disposed-off as per the provisions of The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and as of 31st March, 2018, no complaint was pending. One complaint pending as on 31st March, 2017, was also disposed-off during the year under review.

Business Responsibility Report

The ''Business Responsibility Report'' (BRR) of your Company for the year 2017-18 forms part of this Annual Report as required under Regulation 34(2)(f) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Your Company strongly believes that sustainable and inclusive growth is possible by using the levers of environmental and social responsibility while setting inspirational 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 the 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 comprises review of risks and Risk Management Policy on 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 therein of elements of risk, including 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.

M. CORPORATE SOCIAL RESPONSIBILITY AND SUSTAINABILITY

Corporate Social Responsibility (CSR)

Your Company''s Corporate Social Responsibility efforts continue to be directed towards supporting the constituencies of girls, youth and farmers by innovatively supporting them through programs in the domains of education, health and environment, while harnessing the power of technology. It is only through these sustained and continued efforts that your Company can build and consolidate its CSR initiatives which contribute to nation building.

During the last financial year, your Company has been making an impact through its ongoing CSR programs, some of the notable ones include - Project Nanhi Kali, which supports the education of underprivileged girls, Mahindra Pride Schools and Mahindra Pride Classrooms, which provide livelihood training to youth from socially and economically disadvantaged communities, and a variety of other scholarship programs, which range from providing opportunities to youth from low income group families to undergo diploma courses at vocational education institutes, to allowing meritorious students to pursue their post graduate studies at reputed universities overseas, to allowing meritorious and deserving students to study at the Mahindra United World College in Pune.

In the area of public health, your Company sponsored Lifeline Express, through which medical care and treatment was provided to communities who do not have access to any medical facilities. Further, your Company supported critical patients suffering from cancer and other life threatening illnesses and also lent support for setting up of the Head and Neck Cancer Institute.

Your Company also contributed to the environment by adding green cover through planting of over 1.5 million trees this year through Project Hariyali. Your Company continues to support small and marginal farmers by training them in effective farming practices including soil health, crop planning, creating model farms with bio-dynamic farming practices, and increasing the water table with a view to increasing crop productivity. These initiatives are implemented through the Wardha Farmer Family Project, Krishi Mitra Project and Integrated Watershed Development Project. Your Company also partnered with the Maharashtra State Government to support the Village Social Transformation Mission of the Government.

Your Company is working to create a ''Zero Fatality Corridor'' to ensure ''zero'' deaths due to accidents on Mumbai Pune Expressway. In addition to the above CSR initiatives, your Company has a vibrant ESOPs (Employee Social Options) platform through which the employees are provided opportunities to give back to the community.

During the last financial year, your Company was awarded the prestigious ''Corporate Citizen of the Year 2017'' by Economic Times as well as the ''Socially Aware Corporate of the Year'' at

Business Standard Awards 2018, both being a validation of the Company''s sustained efforts to ''Rise for Good''.

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 can be accessed at the Company''s website through the Web-link: http://www.mahindra.com/resources/investor-reports/FY18/ Annual Reports/Links-AnnualReport.zip

CSR Committee

The CSR Committee comprises of Dr. Vishakha N. Desai (Chairperson), Mr. Anand G. Mahindra, Mr. R. K. Kulkarni, Dr. Pawan Goenka and Mr. Vikram Singh Mehta. The Committee, inter alia, reviews and monitors the CSR as well as Sustainability activities.

During the year under review, your Company spent Rs. 81.97 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. 81.27 crores. The detailed Annual Report on the CSR activities undertaken by your Company in Financial Year 2018, is annexed herewith marked as Annexure VI.

Sustainability

During the year under review, the 10th Non-Financial Report was released for the year 2016-17. This year''s Report was the first ''Integrated Report'' conforming to reporting frameworks viz. International Integrated Reporting Council (IIRC) and Global Reporting Guideline - ''GRI G4 Core option''. The report was externally assured by DNV-GL.

Your Company continued the focus on the Environmental, Social and Governance (ESG) parameters, in the year under review by developing Mahindra Sustainability Framework to ensure common language for sustainability across the Group. This framework defines sustainability as building enduring businesses by rejuvenating the environment and enabling stakeholders to rise. Under the three pillars People, Planet and Profit of Sustainability; various actions have been identified for implementation across the Group. Many of these actions are already underway as demonstrated by the Igatpuri Plant by getting certified as ''Water Positive'' and being the 1st Plant in India to be certified by Intertek as ''Zero Waste to Landfill''.

The Company uses 63% less energy to produce a vehicle than what was done eight years ago. Mahindra Towers at Worli and Kandivali are Indian Green Building Council (IGBC) Platinum Certified existing buildings. The Mahindra IT Centre at Kandivali is USGBC LEED gold certified green building.

Mr. Anand G. Mahindra, Executive Chairman of your Company represented the Corporate World Economic Forum at Davos and issued a ''Call to Action'' to all industries and businesses to adopt Science Based Targets to restrict average global temperature rise to 2 degree Celsius in alignment of Paris Climate Change Agreement. Mr. Anand Mahindra has been invited by Mr. Edmund G. Brown, Governor of California to be the Co-Chair at the Global Climate Action Summit to be held in September, 2018 in San Francisco, California.

The Sustainability performance for your Company for the Financial Year 2017-18 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:

- Winning the Indo German Chamber of Commerce Award 2017 for ''Best Sustainable Business Practices''.

- Winning Cll National Energy Conservation Awards and Cll National Water Management Awards for 6 manufacturing plants.

- Winning 1st runner up for Igatpuri Plant at Frost & Sullivan-TERI Sustainability 4.0 for Sustainable Factory of the Year.

- Retaining the status of getting listed on the Dow Jones Sustainability Index-2017 under the ''Emerging Market Index'' for the fourth year with improvement in percentile scores.

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.

N. SECRETARIAL

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.

Extract of 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, an extract of the Annual Return as on 31st March, 2018 in Form No. MGT-9 is attached as Annexure VIII and forms part of this Report.

GENERAL

The Executive Chairman of the Company did not receive any remuneration or commission from any of the subsidiary of your Company. The Managing Director of the Company did not receive any remuneration or commission from any of the subsidiary of your Company. However, the Managing Director has exercised ESOPs of a subsidiary company during the year, which were granted in the earlier year(s).

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 except as stated hereunder:

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 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).

For and on behalf of the Board

ANAND G. MAHINDRA

Executive Chairman

Mumbai, 29th May, 2018


Mar 31, 2018

DIRECTORS'' REPORT

The Directors present their Thirty First Annual Report together with the audited accounts of your Company for the year ended March 31, 2018.

FINANCIAL RESULTS (STANDALONE)

(Rs, in Million)

For the year ended March 31

2018

2017

Income

253,919

240,583

Profit before Interest, Depreciation and tax

56,335

45,647

Interest

(708)

(638)

Depreciation

(6,562)

(6,222)

Profit Before Tax

49,065

38,787

Provision for taxation

(9,072)

(8,314)

Profit after tax

39,993

30,473

Other Comprehensive Income

128

(1)

Balance brought forward from previous year

120,789

106,118

Profit available for appropriation

160,910

136,590

Final Dividend Including tax

(10,361)1

(13,787)2

Transfer from Share Option Outstanding Account

51

28

Transfer from General Reserve

-

-

Transferred on merger of US branch with US subsidiary

-

(2,042)

Transferred to Special Economic Zone re-investment reserve

(42)

-

Balance carried forward

150,558

120,789

1 Dividend for the financial year ended March 31, 2017

2 Dividend for the financial year ended March 31, 2016

DIVIDEND

Your Directors are pleased to recommend a dividend of Rs, 14/- per Equity Share (280%), payable to those Shareholders whose names appear in the Register of Members as on the Book Closure Date.

Your Company has formulated a Dividend Policy and disclosed it on the website of the Company

https://www.techmahindra.com/sites/ResourceCenter/

brochures/investors/corporategovernence/Dividend-

Policy.pdf

SHARE CAPITAL

During the year under review, your Company allotted 5,637,728 equity shares on the exercise of stock options under various Employee Stock Option Plans. Consequently the issued, subscribed and paid-up equity share capital has increased from Rs, 4,870.48 Million divided into 974,096,080 equity shares of Rs, 5/- each to Rs, 4,898.67 Million divided into 979,733,808 equity shares of Rs, 5/- each.

BUSINESS PERFORMANCE / FINANCIAL OVERVIEW

Your Company represents the connected world, offering innovative and customer-centric information technology experiences, enabling Enterprises, Associates and the Society to Rise™. The Company has presence across 90 countries and helps over 900 global customers including Fortune 500 companies. The Company''s convergent, digital, design experiences, innovation platforms and reusable assets connect across a number of technologies to deliver tangible business value and experiences to the stakeholders.

In the fiscal year 2017-18 the Company''s consolidated revenues increased to Rs, 307,729 Million from Rs, 291,408 Million in the previous year, a growth of 5.6%. The geographic split of revenue is well balanced across regions, with 46% share from the Americas, 30% share from Europe and 24% from the Rest of the World.

The Consolidated Profit Before Interest, Depreciation and Tax (EBITDA) was at Rs, 47,096 Million, against Rs, 41,844 Million in the previous year.

The Consolidated Profit after Tax (PAT), amounted to Rs, 37,998 million, as against Rs, 28,129 million in the previous year.

In the emerging areas of Big Data, Mobility, Networks, Cloud, Security, Platforms and Engineering Services, the Company is well placed with its breadth of Service offerings and has a diversified customer base. Tech Mahindra also has intellectual property in various

Products & Services and Platforms, and is committed towards building a synergistic relationship with its partners, to deliver a complete and customized end-to-end solutions to its customers.

There are no material changes or commitments affecting the financial position of the Company between the end of the financial year and the date of the report.

ACQUISITIONS

CJS Solutions Group, LLC (HCI), USA:

The Company, on May 4, 2017, through its wholly owned subsidiary Tech Mahindra (Americas) Inc. acquired 84.7% stake in CJS Solutions Group, LLC (doing business as HCI) for an initial consideration of Rs, 5,742 Million (USD 89.5 Million). Further the subsidiary of the Company acquired a call and a written put option on the 15.3% Non-Controlling Interest to be exercised over a three year period ending December 31, 2019. The HCI Group works with some of the world''s most prestigious Tier-I healthcare service providers, primarily in the US and UK, focusing on providing end-to-end implementation of Electronic Health Record (EHR) and Electronic Medical Record (EMR) software, training and support services. This will help scale up Healthcare revenue, as provider sub vertical is a key element of Healthcare and Life Sciences (HLS) strategy. The Company offers innovative and end-to-end integrated solutions for healthcare providers. Its solutions enhances the efficiency of physicians, hospitals, ancillary facilities, clinics, governmental health bodies and public health organizations.

Increase in stake in Comviva Technologies Limited:

The Company, in accordance with the shareholders agreement, acquired an additional 32.07% stake in Comviva Technologies Limited from Bharati Group and Westbridge Ventures II Investment holdings for a total consideration of '' 3,618 Million. The Company also acquired 0.68% from some shareholders for a total consideration of '' 70 Million. As a result of this, the Company now holds 99.85% stake in Comviva Technologies.

Comviva is amongst the leaders in mobility solutions. Its expansive suite of productized solutions is deployed with over 130 service providers and banks, in over 90 countries across Asia, Africa, Middle East, Latin America and Europe, and powers services to over two billion mobile subscribers.

Altiostar Inc:

The Company, through its wholly owned subsidiary Tech Mahindra (Americas) Inc. has invested an amount of US$ 15 Million in return for a 22.5% shareholding in Altiostar. Altiostar is the mobile broadband industry''s first provider of vRAN (virtualized Radio Access Networks) solution for LTE technology.

DETAILS OF SUBSIDIARIES/JOINT VENTURES/ASSOCIATE COMPANIES

During the year under review, the Board of Directors of the Company at their meeting held on November 1, 2017 approved a proposal to amalgamate Sofgen India Private Limited, a step-down subsidiary with the Company in accordance with the provisions of Companies Act, 2013.

The Company and Sofgen India Private Limited have filed the Company Scheme Petitions before the Hon''ble National Company Law Tribunals at Mumbai and Chennai respectively and are pending for approval.

The performance and financial position of the subsidiaries, associate companies and joint venture companies included in the consolidated financial statement is provided in accordance with the provisions of Section 129 read with Rule 5 of the Companies (Accounts) Rules, 2014 containing the salient features of the financial statement of Company''s subsidiaries/joint ventures or associate companies in Form AOC - 1 in "Annexure I" to this report.

Pursuant to Rule 8(5) (iv) of the Companies (Accounts) Rules, 2014, the names of the companies which have become or ceased to be the subsidiaries, joint ventures or associate companies during the year are provided in "Annexure II" to this report.

The policy for determining Material Subsidiaries formulated by the Board of Directors is disclosed on the Company''s website and is accessible on https://www.techmahindra.com/sites/ResourceCenter/ brochures/investors/corporategovernance/policy-For-determining-Material-Subsidiaries.pdf

HUMAN RESOURCES

During 2017-18, your Company focused on unlocking experiences for a connected future and deliver an enterprise of Future. Along with establishing as DT (Digital Transformation) provider, your Company has also taken a step towards being a social enterprise. Your Company''s mission is to attain growth while respecting and supporting the stakeholder network. The Company aims to be the organization that will shoulder the responsibility of being a good citizen, inspire associates and be role model for peers. With the intent of future proofing the associates and preparing them for future, your Company has embarked on journey of FUTURise that ensures continuous learning, unlearning, re-learning, and contribution to innovation for our customers. Increasing number of enterprises are embracing new technologies like Digital, Automation, Cloud, Augmented Reality to provide enhanced user experience, the need to transform skillset of IT workforce is prominent than ever. Your Company is investing heavily in re-skilling and up-skilling its associates to enable them to RISE™ to future challenges and opportunities and achieve customer delight.

Building Future ready workforce and Continuous Learning Organization

Your Company has launched ''DEXT'' - a cloud based new age learning platform to facilitate an Integrated, Social, Personalized and Device Agnostic Learning experience for its associates and building a continuous learning organization. Further, your Company has partnered with some of the best in industry players like edX, Pluralsight, SumTotal and new age AI based learning platforms to provide world-class learning experience to its associates and accelerate their learning.

The ''Role Based Academy'' provides a structured, holistic approach to building role based competencies for critical and new age roles in the organization and provide career path to the associates. Your Company has trained and certified 80,000 associates in digital technologies, 20,000 associates in automation and trained 50,000 associates in emerging and digital technologies. This focus has positioned your Company to service leading global Enterprises in their transformation journey and enhance growth and profitability. Emphasizing on the new age learning methods and platforms, your Company has launched the Reverse Mentoring program, where Gen Y/Z grooms Leadership on new age practices and tools. Your organization has taken steps in the direction of building a workplace of future by building UVO, a chat bot that is always available for instant query resolution, handle transactions and acts as your virtual office assistant.

Skill building through job adjacency in the form of eXtra Mile platform allows the associates to opt for small assignments posted pan organization and utilize their skills for the benefit of the assigned project. Career counseling platform provides guidance by experienced leaders when lacking direction or clarity.

In order to keep the associates aligned to the digital mission of the organization - Mission 2020, your Company has been continuously hosting conclaves like Mission Innovation and TechM NXT that allows Tech Mighties to express their views about the big bets and trends of the world, connect with internal and external stakeholders, co-create new age ventures and also celebrate the realization of ideation. Iris, Appify, helped spark the entrepreneurial spirit among associates of the Company. In order to reach out to the multicultural and diverse workforce your Company has embarked on the journey of Gasification and launched Career Turbo for career exploration and Rise with Dice to help ingrain the culture.

Rewarding and Recognizing

Your Company believes that timely appreciation remains key to creating a happy organization and recognized over 45,000 Tech Mighties through multiple channels. In line with the digitization focus, the entire Reward and Recognition process is digital and associates share their rewards and pride on their respective social networks.

Strive, Sustain and Safety

Your Company took various steps to ensure the safety and work-life balance of associates working at Tech Mahindra. The Associate Welfare Trust established for the associates, by the associates, helped associates and their family members in their medical exigencies. Company''s Mantra of "Wellness before Business" is reflected in the medical camps, wellness programs, work from home facility and numerous other facilities across all the large campuses. Your Company has established a robust Emergency contact process with toll free numbers across India, US, UK, and Australia and conducted self-defence training sessions across many locations.

During the year under review, Tech Mahindra''s people practices, policies and programs have been awarded in various external forums representing members from not just the Information Technology industry but the entire spectrum of the corporate world. Some of the awards/accomplishments during FY 2017-18 are -

- Society for Human Resource Management - HR Excellence 2017 in Learning and Development (runner up) and Employer with Best Health and Wellness initiatives.

- Business World HR Award in HR Technology 2017

- Featured in AVTAR - 100 Best Companies of 2017 Working Mother and AVTAR Best Companies for Women in India.

- Featured in HR Asia Best Companies To Work For In Asia 2017 - Malaysia

- Excellence in Workplace Diversity Award at Mercer NDTV Employer Excellence Awards 2017.

These awards and recognitions have positioned Tech Mahindra as an organization that puts people first, delivers future focused excellence in the field of People Management and recognizes the importance of human capital as a key driver of business growth.

QUALITY

Your Company continues its focus on quality and strives to exceed customer expectations at all times. It is certified under various standards to meet client demands and enhance value delivery - Successfully assessed for, ISO 9001:2015, ISO 20000:2011, ISO 27001: 2013, TL9000 R 5.5, ISO 13485, AS9100 (Standard for Aerospace domain - scope of certification limited to the aerospace business within Tech Mahindra). In addition to these, your Company also maintains its commitment to health, safety and environment by continually improving its processes in accordance with ISO 14001 and OHSAS 18001 standards. Your Company is also certified on ISO 22301:2012 (Societal Security) and has a comprehensive Business Continuity and Disaster Recovery framework, to prevent potential business disruptions in the event of any disaster. It has processes that will help resume services to customers'' acceptable service levels. Automated Service Desk with SLAs for enabling business and Vulnerability Assessment and Penetration Testing Lab for secured corporate network operations are highlights showcasing information security posture of the Organization.

Tech Mahindra (IT Division) has been assessed for implementation of high maturity business excellence practices'' at Mahindra Group (Services Sector). It has been assessed at TMW Maturity Stage 5 (on scale of 1-10 stages) of Mahindra Business Excellence Framework - The Mahindra Way. These certifications are testimony of the robustness of business processes and at large the quality culture imbibed in the organization.

Your Company has also strengthened Process/Practice and Tools Industrialization of various Engineering activities for Development, Testing and Managed service portfolio to achieve standardization, better efficiency and best practices being implemented across the businesses.

Your Company has continued to strengthen the process for transforming Quality Assurance processes to New Age Delivery processes with focus to achieve better customer experience and faster quality delivery; these are measured and monitored through various indices.

One such initiative is "Execution Excellence Index" focusing on achieving high project maturity, improved tools usage and standardization, knowledge management and performance on key business metrics, in order to strengthen further the Business Excellence in what we deliver to the customers, thereby achieve better Customer satisfaction. Your Company is putting all the initiatives in place in order to ensure the Company delivers as stated in Quality Policy.

DIRECTORS

During the year under review all Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the Securities and Exchange Board of India (Listing Obligations And Disclosure Requirements) Regulations, 2015.

Pursuant to the provisions of Section 152(6)(c) of the Companies Act, 2013, Mr. Vineet Nayyar, Director (DIN: 00018243) is liable to retire by rotation and does not offer himself for reappointment. The Board has decided, not to fill the vacancy caused by retirement of Mr. Vineet Nayyar.

Mr. Vineet Nayyar served on your Board since January 17, 2005. He served as Managing Director & CEO till August 10, 2012. Mr. Vineet Nayyar was appointed as Executive Vice Chairman with effect from August 10, 2012 till August 10, 2015. Thereafter, he continued as Vice Chairman.

Mr. Vineet Nayyar is one of the strongest pillars in the Tech Mahindra success story. The Board places on record its sincere appreciation for the valuable advice and guidance of Mr. Vineet Nayyar during his tenure as a Director on the Board.

Training & Familiarization Programme

The Company has laid down a policy on training for Independent Directors as part of the governance policies.

The Board Members are regularly updated on changes in Corporate and allied laws, Taxation laws & matters thereto. MD & CEO along with Senior Leadership conducts an exclusive quarterly session for the Board Members sharing updates about the Company''s business strategy, operations and the key trends in the IT industry relevant for the Company. These updates help the Board Members to keep themselves abreast with the key changes and their impact on the Company.

The details of programmes for familiarization of the Independent Directors with the Company are available on the Company''s website and can be accessed at the we blink; https://www.techmahindra. com/sites/ResourceCenter/brochures/investors/ corporategovernence/Familiarization-Programme-to-Independent-Directors.pdf

Board Evaluation

Pursuant to the provisions of the Companies Act, 2013 and Regulation 19 read with Schedule II, Part D of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has devised a policy on evaluation of performance of Board of Directors, Committees and Individual directors. Accordingly, the Chairman of the Nomination and Remuneration Committee obtained from all the board members duly filled in evaluation templates for evaluation of the Board as a whole, evaluation of the Committees and peer evaluation. The summary of the evaluation reports was presented to the respective Committees and the Board for their consideration.

Policy on Directors'' Appointment and Remuneration

The Governance policies laid down by the Board of Directors of your Company include:

i. Policy on appointment and removal of Directors, Key Managerial Personnel and Senior Management

ii. Policy on remuneration to the Directors, Key Managerial Personnel and Senior Management and other Employees

The extract of these two policies are provided in "Annexure III".

SUCCESSION PLAN

In accordance with the principles of transparency and consistency, your Company has adopted governance policies for Board of Directors, KMP & Senior Management appointments, remuneration & evaluation. These governance policies inter alia outline Succession Planning for the Board, Key Managerial Personnel and Senior Management.

Key Managerial Personnel (KMPs)

Pursuant to provisions of Section 203 of the Companies Act, 2013, Mr. C. P. Gurnani, Managing Director & Chief Executive Officer, Mr. Milind Kulkarni, Chief Financial Officer and Mr. Anil Khatri, Company Secretary & Compliance Officer were the Key Managerial Personnel of the Company during the year.

Mr. Milind Kulkarni is superannuating on May 31, 2018 as Chief Financial Officer of the Company. Mr. Manoj Bhat is appointed as Chief Financial Officer of the Company w.e.f. June 1, 2018.

DIRECTORS'' RESPONSIBILITY STATEMENT

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

i. in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

ii. they have selected such accounting polices and these have been applied consistently and, reasonable and prudent judgments and estimates have been made so as to give a true and fair view of the state of affairs of the Company as at March 31, 2018 and of the profit of the Company for the year ended on that date;

iii. proper and sufficient care had been taken 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 other irregularities;

iv. the annual accounts have been prepared on a going concern basis;

v. they had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively;

vi. the proper systems to ensure compliance with the provisions of all applicable laws are in place and are adequate and operating effectively.

DETAILS IN RESPECT OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS

The Company has internal financial controls which are adequate and were operating effectively. The controls are adequate for ensuring the orderly & efficient conduct of the business, including adherence to the Company''s policies, the safe guarding of assets, the prevention & detection of frauds & errors, the accuracy & completeness of accounting records and timely preparation of reliable financial information.

STATUTORY AUDITORS

The members, in the 30th Annual General Meeting held on August 1, 2017, appointed M/s. B S R & Co. LLP, Chartered Accountants, [Firm''s Registration No. 101248W/W-100022] as the Statutory Auditors (''BSR'') of the Company, to hold office for a term of five years from the conclusion of the 30th Annual General Meeting (AGM) of the Company held in the financial year 2017-18 until the conclusion of the AGM of the Company for the financial year 2021-22 on such remuneration as may be determined by the Board of Directors.

Pursuant to the amendment to Section 139 of the Companies Act, 2013 which was notified on May 7, 2018, ratification of appointment of Statutory Auditors at every AGM is no longer required.

There are no qualifications, reservation or adverse remark or disclaimer made in the audit report for the Financial Year 2017-18.

SECRETARIAL AUDIT REPORT

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 had appointed Dr. K. R. Chandratre, Practicing Company Secretary, Pune to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is provided as "Annexure IV". There are no qualifications, reservation or adverse remark or disclaimer made in the Secretarial Audit Report.

COMPLIANCE WITH SECRETARIAL STANDARDS

The Company has complied with the applicable Secretarial Standards.

EXTRACT OF THE ANNUAL RETURN

Pursuant to the provisions of Section 134(3) (a) of the Companies Act, 2013, the extract of the Annual Return in Form MGT-9 is attached as "Annexure V".

MANAGERIAL REMUNERATION

Disclosures of the ratio of the remuneration of each director to the median employee''s remuneration and other details as required pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended from time to time, are provided in "Annexure VI".

None of the directors or Managing Director of the Company, received any remuneration or commission from Subsidiary Companies of your Company.

The details of remuneration paid to the Directors including the Managing Director of the Company are given in Form MGT-9 forming part of the Directors Report.

PARTICULARS OF EMPLOYEES

The information required under Section 197(12) of the Companies Act, 2013 ("the Act") read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms part of this Report. However, pursuant to first proviso to Section 136(1) of the Act, this Report is being sent to the Shareholders excluding the aforesaid information. Any shareholder interested in obtaining said information, may write to the Company Secretary at the Registered Office / Corporate Office of the Company and the said information is open for inspection at the Registered Office of the Company.

PREVENTION OF SEXUAL HARASSMENT POLICY

Your Company laid down Prevention of Sexual Harassment policy and it is made available on the website of the Company. The Company has zero tolerance on Sexual Harassment at workplace. During the year under review there were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

EMPLOYEE STOCK OPTION SCHEMES

During the year under review, there were no material changes in the Employee Stock Option Schemes (ESOPs) of the Company and the Schemes are in compliance with the SEBI Regulations on ESOPs. As per Regulation 14 of SEBI (Share Based Employee Benefits) Regulations, 2014 read with SEBI circular dated June 16, 2015 the details of the ESOPs are uploaded on the Company''s website; https://www. techmahindra.com/sites/Resource Center/brochures/ investors/corporate governance/Details-of-ESOPs.pdf

The Board of Directors have approved a new Employee Stock Option Scheme viz. "Employee Stock Option Scheme 2018", earmarking 50,00,000 Options to be granted to the employees exercisable into equity shares. This is forming part of the Notice of the ensuing Annual General Meeting for approval of shareholders.

CORPORATE GOVERNANCE

A report on Corporate Governance covering among others composition, details of meetings of the Board and Committees along with a certificate for compliance with the conditions of Corporate Governance in accordance with the Securities and Exchange Board of India (Listing Obligations And Disclosure Requirements) Regulations, 2015, issued by the Statutory Auditors of the Company, forms part of this Annual Report.

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.

RISK MANAGEMENT

The Risk Management Committee of the Board of Directors periodically reviews the Risk Management framework, identifies risks with criticality and mitigation plan. The elements of risk as identified for the Company with impact and mitigation strategy are set out in the Management Discussion and Analysis Report (MDA).

ESTABLISHMENT OF VIGIL MECHANISM

Your Company has laid down Whistle Blower Policy covering Vigil Mechanism with protective clauses for the Whistle Blowers. The Whistle Blower Policy is made available on the website of the Company.

DEPOSITS / LOANS & ADVANCES, GUARANTEES OR INVESTMENTS

Your Company has not accepted any deposits from the public during the year under review. The particulars of loans/advances, guarantees and investments under Section 186 of the Companies Act, 2013 are given in the notes forming part of the Financial Statements.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All transactions entered into with Related Parties as defined under Section 2(76) of the Companies Act, 2013 and Regulation 23 of the Securities and Exchange Board of India (Listing Obligations And Disclosure Requirements) Regulations, 2015, ("The Listing Regulations"), during the financial year were in the ordinary course of business and at an arm''s length pricing basis and do not attract the provisions of Section 188 of the Companies Act, 2013. There were no transactions with related parties in the financial year which were in conflict with the interest of the Company and requiring compliance of the provisions of Regulation 23 of the Listing Regulations. Suitable disclosure as required by the Indian Accounting Standards (Ind AS 24) has been made in the notes forming part of the Financial Statements.

The Company has formulated a policy on materiality of Related Party Transactions and dealing with Related Party Transactions which has been uploaded on the Company''s website; https://www.techmahindra.com/sites/ Resource Center/Brochures/investors/corporate governance / Related-Party-Transactions-Policy.pdf

The particulars of related party transactions in prescribed Form AOC - 2 are attached as "Annexure VII".

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars as prescribed under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the

Companies (Accounts) Rules, 2014 are provided in "Annexure VIII" which forms part of this report.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

The CSR vision of your Company is "Empowerment through Education."

In compliance with the guidelines prescribed under Section 135 of the Companies Act, 2013, your Company constituted a Corporate Social Responsibility (CSR) Committee. Your Board of Directors laid down the CSR Policy, covering the Objectives, Focus Areas, Governance Structure and Monitoring & Reporting Framework among others. The policy is available at https://www.techmahindra.com/society/default.aspx.

Your Company''s social initiatives are carried out by Tech Mahindra Foundation and Mahindra Educational Institutions.

TECH MAHINDRA FOUNDATION (TMF)

The Foundation was set up in 2007, as a Section 25 Company (referred to as a Section 8 Company in the Companies Act, 2013). Since then, it has worked tirelessly towards the vision of "Educated, skilled and able women and men are a country''s true strength", establishing itself as a prominent CSR player within the Mahindra Group as well as a leading social organization at the national level. The Foundation essentially works with children and youth from urban, disadvantaged communities in India. During the year under review, Tech Mahindra Foundation has successfully steered 160 high-impact projects with 90 partners, reaching out to 150,000 children and youth across these locations.

The key initiatives in the School Education include:

All Round Improvement in School Education (ARISE)

Tech Mahindra Foundation''s educational initiatives under ARISE are long-term school improvement programmes, in partnership with local governments and partner organizations. The Foundation has adopted 60 schools across India and is working with 18 partners to turn them around completely into model schools of excellence. ARISE initiatives encompass educational empowerment programmes for children with disabilities.

Shikshaantar

Shikshaantar, envisioned as a programme for enhancing capacity of government school teachers, has taken rapid strides during the year. TMF has been working with the East Delhi Municipal Corporation to manage its In-Service Teacher Education Institute (ITEI), where teachers from nearly 400 primary schools receive quality training on a regular basis. In addition, the Foundation has also worked with Municipal Corporations in Chennai, Bengaluru, Hyderabad, Pune & Thane for strengthening capacities of government school teachers.

Employability

Skills for Market Training (SMART) is the Foundation''s flagship programme in employability. It is built on the vision of an educated, enlightened and employed India, and a belief that educated and skilled youth are the country''s true strength. The programme started with 3 Centres in 2012 and is currently running 100 Centres at 11 locations across India. These include SMART Centres, SMART Centres (training for people with disabilities), and SMART-T Centres (training in technical trades).

In 2017-18, your Company trained more than 16,000 young women and men under its SMART programme. More than 70% of the graduates are placed in jobs upon successful completion of the training, across multiple industries.

The Foundation has partnered with the Banasthali University for Women in Rajasthan for setting up of the Tech Mahindra College of Nursing. The College will start offering Bachelor’s and Master''s Degree Programs in Nursing.

MAHINDRA EDUCATIONAL INSTITUTIONS (MEI) Technical Education

Your Company''s initiatives in technical education are carried out through Mahindra Educational Institutions (MEI), under which the Company has extended infrastructural and operational support to Mahindra Ecole Centrale, a state of-the-art technical institution in Hyderabad.

Mahindra Ecole Centrale (MEC), College of Engineering, established by Tech Mahindra in collaboration with Ecole Centrale Paris (now Centrale Supelec) and Jawaharlal Nehru Technological University, Hyderabad is set to deliver its first batch of graduates this year, after a successful four year presence on the technical education landscape of the country, characterized by its rising popularity.

This high impact, Indo-French collaboration in engineering education has emerged as a disruptive player with its keen focus on Industry-aligned and industry-sponsored education; all Ph.D. faculty roster, global internships and a distinct curriculum that includes the French language.

The Executive Council of MEC features leaders both from Tech Mahindra and the Mahindra Group. The

MEC campus, surrounded by the sprawling green Tech Mahindra Technology Centre in Hyderabad, India, is equipped with state-of-the-art academic infrastructure. To support its strong research vision MEC has set up relevant high technology laboratories for learning, media, design thinking and research.

MEC has hosted many of the Company''s customers on their visit to Tech Mahindra Technology Center (TMTC), Hyderabad. The customers express surprise and delight at the presence of MEC and its pedagogy aimed at shaping world class engineers, with global relevance and a strong European influence.

The Annual Report on CSR activities is provided as "Annexure IX".

SUSTAINABILITY

As a responsible business entity, Tech Mahindra concentrates on integrating sustainability into all aspects of the business and develop strategies for Environmental, Social and Governance (ESG) dimensions. The Company has defined strategies to leverage sustainable opportunities to create value for its stakeholders and help emerge as a more efficient organization with increasingly optimized business processes. With a structured stakeholder programme the Company has been able to design strategies and initiatives to build solutions which not just improve its sustainability credentials but reinforce the overall business philosophy too.

The Company''s responsibilities and emphasis on its green eco-system is seen through various energy, water and waste reduction initiatives that have helped cut down carbon emissions, made it more energy-efficient and help mitigate its environmental impact. Tech Mahindra is moving towards carbon neutrality through various Sustainability initiatives and best practices. The Company is striving to reduce the carbon footprint by installing solar modules, retrofitting LEDs, installing motion sensors, using star rated equipment and recycling waste water. The Company has digitalized internal communications with virtual meetings through tele/audio conferencing, which brings down meeting-related travel and other costs considerably. Your Company is investing in Green Solutions like smart grid, smart cities, smart waste management systems and electric vehicle charging systems. Your Company is also working with suppliers and vendors to cut down on logistics and transportation and thus reduce the emissions.

The recent leadership position and achievements across platforms encourage us to strive for excellence and aim even higher.

Few of the recognitions bestowed upon are:

- Recognized as World Leader for Supplier Engagement on Climate Change 2018 by CDP-the only Indian Company on this Leader Board

- Member of DJSI World Index for 2017- one amongst the only 4 Indian companies to be listed

- One of the 11 Indian Companies who are part of the DJSI Emerging Markets category

- Listed as a ''Rising Star'' in the CDP''s India Leaders 2017

- Silver Class distinction for excellent sustainability performance in the RobecoSAM 2018 Sustainability Yearbook

- Constituent of the FTSE4Good Emerging Index 2017

Tech Mahindra developed its first Integrated Report last year which is externally assured in accordance with Global Reporting Initiatives (GRI Guidelines) the latest guidelines of the internationally accepted Global Reporting Initiative (GRI) and CDSB format. The detailed reports can be accessed at https://www. techmahindra.com/company/Sustainability.aspx

AWARDS AND RECOGNITION

Your Company continued its quest for excellence in its chosen area of business to emerge as a true global brand. Several awards and rankings continue to endorse your Company as a thought leader in the industry. The Awards / recognitions received by the Company during the year 2017-18 include:

- Digital Transformation Service Provider of the Year - Telecom 2017 from Frost and Sullivan

- CP Gurnani wins the Digital Warrior award from IMC

- Tech Mahindra Performance Engineering wins IT Europa Award for "Storage/Information Management Solution of the Year"

- Recognized as a Most Honoured Company by the Institutional Investor''s 2017 All-Asia (ex-Japan) Executive Team rankings

- Oracle ASEAN Digital Transformation Partner

- Frost & Sullivan Digital Transformation Award

- Tech Mahindra recognized at SHRM Awards 2017

- Tech Mahindra retains ranking in Dow Jones Sustainability Index 2017

- Features in 100 Best organizations in 2017 Working Mother & AVTAR Best Companies for Women in India

- Business World HR Excellence Award In Technology & Learning

- Best Company in terms of Information Security Implementation at the IT Innovation & Excellence Awards 2017 in the Annual Technology Conference held by CSI (Computer Society of India)

- BlockChain solution for State Bank of India wins the SKOCH Award 2017

- Recognized amongst world''s top 100 technology companies by Thomson Reuters

- 2018 AT&T Supplier Award for its outstanding performance and service to AT&T affiliates

ACKNOWLEDGEMENTS

Your Directors place on record their appreciation for the contributions made by employees towards the success of your Company. Your Directors gratefully acknowledge the co-operation and support received from the shareholders, customers, vendors, bankers, regulatory and Governmental authorities in India and abroad.

For and on behalf of the Board

Place: Mumbai Anand G. Mahindra

Date: May 25, 2018 Chairman


Mar 31, 2018

DIRECTORS'' REPORT

The Directors present their Thirty First Annual Report together with the audited accounts of your Company for the year ended March 31, 2018.

FINANCIAL RESULTS (STANDALONE)

(Rs, in Million)

For the year ended March 31

2018

2017

Income

253,919

240,583

Profit before Interest, Depreciation and tax

56,335

45,647

Interest

(708)

(638)

Depreciation

(6,562)

(6,222)

Profit Before Tax

49,065

38,787

Provision for taxation

(9,072)

(8,314)

Profit after tax

39,993

30,473

Other Comprehensive Income

128

(1)

Balance brought forward from previous year

120,789

106,118

Profit available for appropriation

160,910

136,590

Final Dividend Including tax

(10,361)1

(13,787)2

Transfer from Share Option Outstanding Account

51

28

Transfer from General Reserve

-

-

Transferred on merger of US branch with US subsidiary

-

(2,042)

Transferred to Special Economic Zone re-investment reserve

(42)

-

Balance carried forward

150,558

120,789

1 Dividend for the financial year ended March 31, 2017

2 Dividend for the financial year ended March 31, 2016

DIVIDEND

Your Directors are pleased to recommend a dividend of Rs, 14/- per Equity Share (280%), payable to those Shareholders whose names appear in the Register of Members as on the Book Closure Date.

Your Company has formulated a Dividend Policy and disclosed it on the website of the Company

https://www.techmahindra.com/sites/ResourceCenter/

brochures/investors/corporategovernence/Dividend-

Policy.pdf

SHARE CAPITAL

During the year under review, your Company allotted 5,637,728 equity shares on the exercise of stock options under various Employee Stock Option Plans. Consequently the issued, subscribed and paid-up equity share capital has increased from Rs, 4,870.48 Million divided into 974,096,080 equity shares of Rs, 5/- each to Rs, 4,898.67 Million divided into 979,733,808 equity shares of Rs, 5/- each.

BUSINESS PERFORMANCE / FINANCIAL OVERVIEW

Your Company represents the connected world, offering innovative and customer-centric information technology experiences, enabling Enterprises, Associates and the Society to Rise™. The Company has presence across 90 countries and helps over 900 global customers including Fortune 500 companies. The Company''s convergent, digital, design experiences, innovation platforms and reusable assets connect across a number of technologies to deliver tangible business value and experiences to the stakeholders.

In the fiscal year 2017-18 the Company''s consolidated revenues increased to Rs, 307,729 Million from Rs, 291,408 Million in the previous year, a growth of 5.6%. The geographic split of revenue is well balanced across regions, with 46% share from the Americas, 30% share from Europe and 24% from the Rest of the World.

The Consolidated Profit Before Interest, Depreciation and Tax (EBITDA) was at Rs, 47,096 Million, against Rs, 41,844 Million in the previous year.

The Consolidated Profit after Tax (PAT), amounted to Rs, 37,998 million, as against Rs, 28,129 million in the previous year.

In the emerging areas of Big Data, Mobility, Networks, Cloud, Security, Platforms and Engineering Services, the Company is well placed with its breadth of Service offerings and has a diversified customer base. Tech Mahindra also has intellectual property in various

Products & Services and Platforms, and is committed towards building a synergistic relationship with its partners, to deliver a complete and customized end-to-end solutions to its customers.

There are no material changes or commitments affecting the financial position of the Company between the end of the financial year and the date of the report.

ACQUISITIONS

CJS Solutions Group, LLC (HCI), USA:

The Company, on May 4, 2017, through its wholly owned subsidiary Tech Mahindra (Americas) Inc. acquired 84.7% stake in CJS Solutions Group, LLC (doing business as HCI) for an initial consideration of Rs, 5,742 Million (USD 89.5 Million). Further the subsidiary of the Company acquired a call and a written put option on the 15.3% Non-Controlling Interest to be exercised over a three year period ending December 31, 2019. The HCI Group works with some of the world''s most prestigious Tier-I healthcare service providers, primarily in the US and UK, focusing on providing end-to-end implementation of Electronic Health Record (EHR) and Electronic Medical Record (EMR) software, training and support services. This will help scale up Healthcare revenue, as provider sub vertical is a key element of Healthcare and Life Sciences (HLS) strategy. The Company offers innovative and end-to-end integrated solutions for healthcare providers. Its solutions enhances the efficiency of physicians, hospitals, ancillary facilities, clinics, governmental health bodies and public health organizations.

Increase in stake in Comviva Technologies Limited:

The Company, in accordance with the shareholders agreement, acquired an additional 32.07% stake in Comviva Technologies Limited from Bharati Group and Westbridge Ventures II Investment holdings for a total consideration of '' 3,618 Million. The Company also acquired 0.68% from some shareholders for a total consideration of '' 70 Million. As a result of this, the Company now holds 99.85% stake in Comviva Technologies.

Comviva is amongst the leaders in mobility solutions. Its expansive suite of productized solutions is deployed with over 130 service providers and banks, in over 90 countries across Asia, Africa, Middle East, Latin America and Europe, and powers services to over two billion mobile subscribers.

Altiostar Inc:

The Company, through its wholly owned subsidiary Tech Mahindra (Americas) Inc. has invested an amount of US$ 15 Million in return for a 22.5% shareholding in Altiostar. Altiostar is the mobile broadband industry''s first provider of vRAN (virtualized Radio Access Networks) solution for LTE technology.

DETAILS OF SUBSIDIARIES/JOINT VENTURES/ASSOCIATE COMPANIES

During the year under review, the Board of Directors of the Company at their meeting held on November 1, 2017 approved a proposal to amalgamate Sofgen India Private Limited, a step-down subsidiary with the Company in accordance with the provisions of Companies Act, 2013.

The Company and Sofgen India Private Limited have filed the Company Scheme Petitions before the Hon''ble National Company Law Tribunals at Mumbai and Chennai respectively and are pending for approval.

The performance and financial position of the subsidiaries, associate companies and joint venture companies included in the consolidated financial statement is provided in accordance with the provisions of Section 129 read with Rule 5 of the Companies (Accounts) Rules, 2014 containing the salient features of the financial statement of Company''s subsidiaries/joint ventures or associate companies in Form AOC - 1 in "Annexure I" to this report.

Pursuant to Rule 8(5) (iv) of the Companies (Accounts) Rules, 2014, the names of the companies which have become or ceased to be the subsidiaries, joint ventures or associate companies during the year are provided in "Annexure II" to this report.

The policy for determining Material Subsidiaries formulated by the Board of Directors is disclosed on the Company''s website and is accessible on https://www.techmahindra.com/sites/ResourceCenter/ brochures/investors/corporategovernance/policy-For-determining-Material-Subsidiaries.pdf

HUMAN RESOURCES

During 2017-18, your Company focused on unlocking experiences for a connected future and deliver an enterprise of Future. Along with establishing as DT (Digital Transformation) provider, your Company has also taken a step towards being a social enterprise. Your Company''s mission is to attain growth while respecting and supporting the stakeholder network. The Company aims to be the organization that will shoulder the responsibility of being a good citizen, inspire associates and be role model for peers. With the intent of future proofing the associates and preparing them for future, your Company has embarked on journey of FUTURise that ensures continuous learning, unlearning, re-learning, and contribution to innovation for our customers. Increasing number of enterprises are embracing new technologies like Digital, Automation, Cloud, Augmented Reality to provide enhanced user experience, the need to transform skillset of IT workforce is prominent than ever. Your Company is investing heavily in re-skilling and up-skilling its associates to enable them to RISE™ to future challenges and opportunities and achieve customer delight.

Building Future ready workforce and Continuous Learning Organization

Your Company has launched ''DEXT'' - a cloud based new age learning platform to facilitate an Integrated, Social, Personalized and Device Agnostic Learning experience for its associates and building a continuous learning organization. Further, your Company has partnered with some of the best in industry players like edX, Pluralsight, SumTotal and new age AI based learning platforms to provide world-class learning experience to its associates and accelerate their learning.

The ''Role Based Academy'' provides a structured, holistic approach to building role based competencies for critical and new age roles in the organization and provide career path to the associates. Your Company has trained and certified 80,000 associates in digital technologies, 20,000 associates in automation and trained 50,000 associates in emerging and digital technologies. This focus has positioned your Company to service leading global Enterprises in their transformation journey and enhance growth and profitability. Emphasizing on the new age learning methods and platforms, your Company has launched the Reverse Mentoring program, where Gen Y/Z grooms Leadership on new age practices and tools. Your organization has taken steps in the direction of building a workplace of future by building UVO, a chat bot that is always available for instant query resolution, handle transactions and acts as your virtual office assistant.

Skill building through job adjacency in the form of eXtra Mile platform allows the associates to opt for small assignments posted pan organization and utilize their skills for the benefit of the assigned project. Career counseling platform provides guidance by experienced leaders when lacking direction or clarity.

In order to keep the associates aligned to the digital mission of the organization - Mission 2020, your Company has been continuously hosting conclaves like Mission Innovation and TechM NXT that allows Tech Mighties to express their views about the big bets and trends of the world, connect with internal and external stakeholders, co-create new age ventures and also celebrate the realization of ideation. Iris, Appify, helped spark the entrepreneurial spirit among associates of the Company. In order to reach out to the multicultural and diverse workforce your Company has embarked on the journey of Gasification and launched Career Turbo for career exploration and Rise with Dice to help ingrain the culture.

Rewarding and Recognizing

Your Company believes that timely appreciation remains key to creating a happy organization and recognized over 45,000 Tech Mighties through multiple channels. In line with the digitization focus, the entire Reward and Recognition process is digital and associates share their rewards and pride on their respective social networks.

Strive, Sustain and Safety

Your Company took various steps to ensure the safety and work-life balance of associates working at Tech Mahindra. The Associate Welfare Trust established for the associates, by the associates, helped associates and their family members in their medical exigencies. Company''s Mantra of "Wellness before Business" is reflected in the medical camps, wellness programs, work from home facility and numerous other facilities across all the large campuses. Your Company has established a robust Emergency contact process with toll free numbers across India, US, UK, and Australia and conducted self-defence training sessions across many locations.

During the year under review, Tech Mahindra''s people practices, policies and programs have been awarded in various external forums representing members from not just the Information Technology industry but the entire spectrum of the corporate world. Some of the awards/accomplishments during FY 2017-18 are -

- Society for Human Resource Management - HR Excellence 2017 in Learning and Development (runner up) and Employer with Best Health and Wellness initiatives.

- Business World HR Award in HR Technology 2017

- Featured in AVTAR - 100 Best Companies of 2017 Working Mother and AVTAR Best Companies for Women in India.

- Featured in HR Asia Best Companies To Work For In Asia 2017 - Malaysia

- Excellence in Workplace Diversity Award at Mercer NDTV Employer Excellence Awards 2017.

These awards and recognitions have positioned Tech Mahindra as an organization that puts people first, delivers future focused excellence in the field of People Management and recognizes the importance of human capital as a key driver of business growth.

QUALITY

Your Company continues its focus on quality and strives to exceed customer expectations at all times. It is certified under various standards to meet client demands and enhance value delivery - Successfully assessed for, ISO 9001:2015, ISO 20000:2011, ISO 27001: 2013, TL9000 R 5.5, ISO 13485, AS9100 (Standard for Aerospace domain - scope of certification limited to the aerospace business within Tech Mahindra). In addition to these, your Company also maintains its commitment to health, safety and environment by continually improving its processes in accordance with ISO 14001 and OHSAS 18001 standards. Your Company is also certified on ISO 22301:2012 (Societal Security) and has a comprehensive Business Continuity and Disaster Recovery framework, to prevent potential business disruptions in the event of any disaster. It has processes that will help resume services to customers'' acceptable service levels. Automated Service Desk with SLAs for enabling business and Vulnerability Assessment and Penetration Testing Lab for secured corporate network operations are highlights showcasing information security posture of the Organization.

Tech Mahindra (IT Division) has been assessed for implementation of high maturity business excellence practices'' at Mahindra Group (Services Sector). It has been assessed at TMW Maturity Stage 5 (on scale of 1-10 stages) of Mahindra Business Excellence Framework - The Mahindra Way. These certifications are testimony of the robustness of business processes and at large the quality culture imbibed in the organization.

Your Company has also strengthened Process/Practice and Tools Industrialization of various Engineering activities for Development, Testing and Managed service portfolio to achieve standardization, better efficiency and best practices being implemented across the businesses.

Your Company has continued to strengthen the process for transforming Quality Assurance processes to New Age Delivery processes with focus to achieve better customer experience and faster quality delivery; these are measured and monitored through various indices.

One such initiative is "Execution Excellence Index" focusing on achieving high project maturity, improved tools usage and standardization, knowledge management and performance on key business metrics, in order to strengthen further the Business Excellence in what we deliver to the customers, thereby achieve better Customer satisfaction. Your Company is putting all the initiatives in place in order to ensure the Company delivers as stated in Quality Policy.

DIRECTORS

During the year under review all Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulation 16(1)(b) of the Securities and Exchange Board of India (Listing Obligations And Disclosure Requirements) Regulations, 2015.

Pursuant to the provisions of Section 152(6)(c) of the Companies Act, 2013, Mr. Vineet Nayyar, Director (DIN: 00018243) is liable to retire by rotation and does not offer himself for reappointment. The Board has decided, not to fill the vacancy caused by retirement of Mr. Vineet Nayyar.

Mr. Vineet Nayyar served on your Board since January 17, 2005. He served as Managing Director & CEO till August 10, 2012. Mr. Vineet Nayyar was appointed as Executive Vice Chairman with effect from August 10, 2012 till August 10, 2015. Thereafter, he continued as Vice Chairman.

Mr. Vineet Nayyar is one of the strongest pillars in the Tech Mahindra success story. The Board places on record its sincere appreciation for the valuable advice and guidance of Mr. Vineet Nayyar during his tenure as a Director on the Board.

Training & Familiarization Programme

The Company has laid down a policy on training for Independent Directors as part of the governance policies.

The Board Members are regularly updated on changes in Corporate and allied laws, Taxation laws & matters thereto. MD & CEO along with Senior Leadership conducts an exclusive quarterly session for the Board Members sharing updates about the Company''s business strategy, operations and the key trends in the IT industry relevant for the Company. These updates help the Board Members to keep themselves abreast with the key changes and their impact on the Company.

The details of programmes for familiarization of the Independent Directors with the Company are available on the Company''s website and can be accessed at the we blink; https://www.techmahindra. com/sites/ResourceCenter/brochures/investors/ corporategovernence/Familiarization-Programme-to-Independent-Directors.pdf

Board Evaluation

Pursuant to the provisions of the Companies Act, 2013 and Regulation 19 read with Schedule II, Part D of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has devised a policy on evaluation of performance of Board of Directors, Committees and Individual directors. Accordingly, the Chairman of the Nomination and Remuneration Committee obtained from all the board members duly filled in evaluation templates for evaluation of the Board as a whole, evaluation of the Committees and peer evaluation. The summary of the evaluation reports was presented to the respective Committees and the Board for their consideration.

Policy on Directors'' Appointment and Remuneration

The Governance policies laid down by the Board of Directors of your Company include:

i. Policy on appointment and removal of Directors, Key Managerial Personnel and Senior Management

ii. Policy on remuneration to the Directors, Key Managerial Personnel and Senior Management and other Employees

The extract of these two policies are provided in "Annexure III".

SUCCESSION PLAN

In accordance with the principles of transparency and consistency, your Company has adopted governance policies for Board of Directors, KMP & Senior Management appointments, remuneration & evaluation. These governance policies inter alia outline Succession Planning for the Board, Key Managerial Personnel and Senior Management.

Key Managerial Personnel (KMPs)

Pursuant to provisions of Section 203 of the Companies Act, 2013, Mr. C. P. Gurnani, Managing Director & Chief Executive Officer, Mr. Milind Kulkarni, Chief Financial Officer and Mr. Anil Khatri, Company Secretary & Compliance Officer were the Key Managerial Personnel of the Company during the year.

Mr. Milind Kulkarni is superannuating on May 31, 2018 as Chief Financial Officer of the Company. Mr. Manoj Bhat is appointed as Chief Financial Officer of the Company w.e.f. June 1, 2018.

DIRECTORS'' RESPONSIBILITY STATEMENT

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

i. in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

ii. they have selected such accounting polices and these have been applied consistently and, reasonable and prudent judgments and estimates have been made so as to give a true and fair view of the state of affairs of the Company as at March 31, 2018 and of the profit of the Company for the year ended on that date;

iii. proper and sufficient care had been taken 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 other irregularities;

iv. the annual accounts have been prepared on a going concern basis;

v. they had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively;

vi. the proper systems to ensure compliance with the provisions of all applicable laws are in place and are adequate and operating effectively.

DETAILS IN RESPECT OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS

The Company has internal financial controls which are adequate and were operating effectively. The controls are adequate for ensuring the orderly & efficient conduct of the business, including adherence to the Company''s policies, the safe guarding of assets, the prevention & detection of frauds & errors, the accuracy & completeness of accounting records and timely preparation of reliable financial information.

STATUTORY AUDITORS

The members, in the 30th Annual General Meeting held on August 1, 2017, appointed M/s. B S R & Co. LLP, Chartered Accountants, [Firm''s Registration No. 101248W/W-100022] as the Statutory Auditors (''BSR'') of the Company, to hold office for a term of five years from the conclusion of the 30th Annual General Meeting (AGM) of the Company held in the financial year 2017-18 until the conclusion of the AGM of the Company for the financial year 2021-22 on such remuneration as may be determined by the Board of Directors.

Pursuant to the amendment to Section 139 of the Companies Act, 2013 which was notified on May 7, 2018, ratification of appointment of Statutory Auditors at every AGM is no longer required.

There are no qualifications, reservation or adverse remark or disclaimer made in the audit report for the Financial Year 2017-18.

SECRETARIAL AUDIT REPORT

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 had appointed Dr. K. R. Chandratre, Practicing Company Secretary, Pune to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is provided as "Annexure IV". There are no qualifications, reservation or adverse remark or disclaimer made in the Secretarial Audit Report.

COMPLIANCE WITH SECRETARIAL STANDARDS

The Company has complied with the applicable Secretarial Standards.

EXTRACT OF THE ANNUAL RETURN

Pursuant to the provisions of Section 134(3) (a) of the Companies Act, 2013, the extract of the Annual Return in Form MGT-9 is attached as "Annexure V".

MANAGERIAL REMUNERATION

Disclosures of the ratio of the remuneration of each director to the median employee''s remuneration and other details as required pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended from time to time, are provided in "Annexure VI".

None of the directors or Managing Director of the Company, received any remuneration or commission from Subsidiary Companies of your Company.

The details of remuneration paid to the Directors including the Managing Director of the Company are given in Form MGT-9 forming part of the Directors Report.

PARTICULARS OF EMPLOYEES

The information required under Section 197(12) of the Companies Act, 2013 ("the Act") read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms part of this Report. However, pursuant to first proviso to Section 136(1) of the Act, this Report is being sent to the Shareholders excluding the aforesaid information. Any shareholder interested in obtaining said information, may write to the Company Secretary at the Registered Office / Corporate Office of the Company and the said information is open for inspection at the Registered Office of the Company.

PREVENTION OF SEXUAL HARASSMENT POLICY

Your Company laid down Prevention of Sexual Harassment policy and it is made available on the website of the Company. The Company has zero tolerance on Sexual Harassment at workplace. During the year under review there were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

EMPLOYEE STOCK OPTION SCHEMES

During the year under review, there were no material changes in the Employee Stock Option Schemes (ESOPs) of the Company and the Schemes are in compliance with the SEBI Regulations on ESOPs. As per Regulation 14 of SEBI (Share Based Employee Benefits) Regulations, 2014 read with SEBI circular dated June 16, 2015 the details of the ESOPs are uploaded on the Company''s website; https://www. techmahindra.com/sites/Resource Center/brochures/ investors/corporate governance/Details-of-ESOPs.pdf

The Board of Directors have approved a new Employee Stock Option Scheme viz. "Employee Stock Option Scheme 2018", earmarking 50,00,000 Options to be granted to the employees exercisable into equity shares. This is forming part of the Notice of the ensuing Annual General Meeting for approval of shareholders.

CORPORATE GOVERNANCE

A report on Corporate Governance covering among others composition, details of meetings of the Board and Committees along with a certificate for compliance with the conditions of Corporate Governance in accordance with the Securities and Exchange Board of India (Listing Obligations And Disclosure Requirements) Regulations, 2015, issued by the Statutory Auditors of the Company, forms part of this Annual Report.

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.

RISK MANAGEMENT

The Risk Management Committee of the Board of Directors periodically reviews the Risk Management framework, identifies risks with criticality and mitigation plan. The elements of risk as identified for the Company with impact and mitigation strategy are set out in the Management Discussion and Analysis Report (MDA).

ESTABLISHMENT OF VIGIL MECHANISM

Your Company has laid down Whistle Blower Policy covering Vigil Mechanism with protective clauses for the Whistle Blowers. The Whistle Blower Policy is made available on the website of the Company.

DEPOSITS / LOANS & ADVANCES, GUARANTEES OR INVESTMENTS

Your Company has not accepted any deposits from the public during the year under review. The particulars of loans/advances, guarantees and investments under Section 186 of the Companies Act, 2013 are given in the notes forming part of the Financial Statements.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All transactions entered into with Related Parties as defined under Section 2(76) of the Companies Act, 2013 and Regulation 23 of the Securities and Exchange Board of India (Listing Obligations And Disclosure Requirements) Regulations, 2015, ("The Listing Regulations"), during the financial year were in the ordinary course of business and at an arm''s length pricing basis and do not attract the provisions of Section 188 of the Companies Act, 2013. There were no transactions with related parties in the financial year which were in conflict with the interest of the Company and requiring compliance of the provisions of Regulation 23 of the Listing Regulations. Suitable disclosure as required by the Indian Accounting Standards (Ind AS 24) has been made in the notes forming part of the Financial Statements.

The Company has formulated a policy on materiality of Related Party Transactions and dealing with Related Party Transactions which has been uploaded on the Company''s website; https://www.techmahindra.com/sites/ Resource Center/Brochures/investors/corporate governance / Related-Party-Transactions-Policy.pdf

The particulars of related party transactions in prescribed Form AOC - 2 are attached as "Annexure VII".

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars as prescribed under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the

Companies (Accounts) Rules, 2014 are provided in "Annexure VIII" which forms part of this report.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

The CSR vision of your Company is "Empowerment through Education."

In compliance with the guidelines prescribed under Section 135 of the Companies Act, 2013, your Company constituted a Corporate Social Responsibility (CSR) Committee. Your Board of Directors laid down the CSR Policy, covering the Objectives, Focus Areas, Governance Structure and Monitoring & Reporting Framework among others. The policy is available at https://www.techmahindra.com/society/default.aspx.

Your Company''s social initiatives are carried out by Tech Mahindra Foundation and Mahindra Educational Institutions.

TECH MAHINDRA FOUNDATION (TMF)

The Foundation was set up in 2007, as a Section 25 Company (referred to as a Section 8 Company in the Companies Act, 2013). Since then, it has worked tirelessly towards the vision of "Educated, skilled and able women and men are a country''s true strength", establishing itself as a prominent CSR player within the Mahindra Group as well as a leading social organization at the national level. The Foundation essentially works with children and youth from urban, disadvantaged communities in India. During the year under review, Tech Mahindra Foundation has successfully steered 160 high-impact projects with 90 partners, reaching out to 150,000 children and youth across these locations.

The key initiatives in the School Education include:

All Round Improvement in School Education (ARISE)

Tech Mahindra Foundation''s educational initiatives under ARISE are long-term school improvement programmes, in partnership with local governments and partner organizations. The Foundation has adopted 60 schools across India and is working with 18 partners to turn them around completely into model schools of excellence. ARISE initiatives encompass educational empowerment programmes for children with disabilities.

Shikshaantar

Shikshaantar, envisioned as a programme for enhancing capacity of government school teachers, has taken rapid strides during the year. TMF has been working with the East Delhi Municipal Corporation to manage its In-Service Teacher Education Institute (ITEI), where teachers from nearly 400 primary schools receive quality training on a regular basis. In addition, the Foundation has also worked with Municipal Corporations in Chennai, Bengaluru, Hyderabad, Pune & Thane for strengthening capacities of government school teachers.

Employability

Skills for Market Training (SMART) is the Foundation''s flagship programme in employability. It is built on the vision of an educated, enlightened and employed India, and a belief that educated and skilled youth are the country''s true strength. The programme started with 3 Centres in 2012 and is currently running 100 Centres at 11 locations across India. These include SMART Centres, SMART Centres (training for people with disabilities), and SMART-T Centres (training in technical trades).

In 2017-18, your Company trained more than 16,000 young women and men under its SMART programme. More than 70% of the graduates are placed in jobs upon successful completion of the training, across multiple industries.

The Foundation has partnered with the Banasthali University for Women in Rajasthan for setting up of the Tech Mahindra College of Nursing. The College will start offering Bachelor’s and Master''s Degree Programs in Nursing.

MAHINDRA EDUCATIONAL INSTITUTIONS (MEI) Technical Education

Your Company''s initiatives in technical education are carried out through Mahindra Educational Institutions (MEI), under which the Company has extended infrastructural and operational support to Mahindra Ecole Centrale, a state of-the-art technical institution in Hyderabad.

Mahindra Ecole Centrale (MEC), College of Engineering, established by Tech Mahindra in collaboration with Ecole Centrale Paris (now Centrale Supelec) and Jawaharlal Nehru Technological University, Hyderabad is set to deliver its first batch of graduates this year, after a successful four year presence on the technical education landscape of the country, characterized by its rising popularity.

This high impact, Indo-French collaboration in engineering education has emerged as a disruptive player with its keen focus on Industry-aligned and industry-sponsored education; all Ph.D. faculty roster, global internships and a distinct curriculum that includes the French language.

The Executive Council of MEC features leaders both from Tech Mahindra and the Mahindra Group. The

MEC campus, surrounded by the sprawling green Tech Mahindra Technology Centre in Hyderabad, India, is equipped with state-of-the-art academic infrastructure. To support its strong research vision MEC has set up relevant high technology laboratories for learning, media, design thinking and research.

MEC has hosted many of the Company''s customers on their visit to Tech Mahindra Technology Center (TMTC), Hyderabad. The customers express surprise and delight at the presence of MEC and its pedagogy aimed at shaping world class engineers, with global relevance and a strong European influence.

The Annual Report on CSR activities is provided as "Annexure IX".

SUSTAINABILITY

As a responsible business entity, Tech Mahindra concentrates on integrating sustainability into all aspects of the business and develop strategies for Environmental, Social and Governance (ESG) dimensions. The Company has defined strategies to leverage sustainable opportunities to create value for its stakeholders and help emerge as a more efficient organization with increasingly optimized business processes. With a structured stakeholder programme the Company has been able to design strategies and initiatives to build solutions which not just improve its sustainability credentials but reinforce the overall business philosophy too.

The Company''s responsibilities and emphasis on its green eco-system is seen through various energy, water and waste reduction initiatives that have helped cut down carbon emissions, made it more energy-efficient and help mitigate its environmental impact. Tech Mahindra is moving towards carbon neutrality through various Sustainability initiatives and best practices. The Company is striving to reduce the carbon footprint by installing solar modules, retrofitting LEDs, installing motion sensors, using star rated equipment and recycling waste water. The Company has digitalized internal communications with virtual meetings through tele/audio conferencing, which brings down meeting-related travel and other costs considerably. Your Company is investing in Green Solutions like smart grid, smart cities, smart waste management systems and electric vehicle charging systems. Your Company is also working with suppliers and vendors to cut down on logistics and transportation and thus reduce the emissions.

The recent leadership position and achievements across platforms encourage us to strive for excellence and aim even higher.

Few of the recognitions bestowed upon are:

- Recognized as World Leader for Supplier Engagement on Climate Change 2018 by CDP-the only Indian Company on this Leader Board

- Member of DJSI World Index for 2017- one amongst the only 4 Indian companies to be listed

- One of the 11 Indian Companies who are part of the DJSI Emerging Markets category

- Listed as a ''Rising Star'' in the CDP''s India Leaders 2017

- Silver Class distinction for excellent sustainability performance in the RobecoSAM 2018 Sustainability Yearbook

- Constituent of the FTSE4Good Emerging Index 2017

Tech Mahindra developed its first Integrated Report last year which is externally assured in accordance with Global Reporting Initiatives (GRI Guidelines) the latest guidelines of the internationally accepted Global Reporting Initiative (GRI) and CDSB format. The detailed reports can be accessed at https://www. techmahindra.com/company/Sustainability.aspx

AWARDS AND RECOGNITION

Your Company continued its quest for excellence in its chosen area of business to emerge as a true global brand. Several awards and rankings continue to endorse your Company as a thought leader in the industry. The Awards / recognitions received by the Company during the year 2017-18 include:

- Digital Transformation Service Provider of the Year - Telecom 2017 from Frost and Sullivan

- CP Gurnani wins the Digital Warrior award from IMC

- Tech Mahindra Performance Engineering wins IT Europa Award for "Storage/Information Management Solution of the Year"

- Recognized as a Most Honoured Company by the Institutional Investor''s 2017 All-Asia (ex-Japan) Executive Team rankings

- Oracle ASEAN Digital Transformation Partner

- Frost & Sullivan Digital Transformation Award

- Tech Mahindra recognized at SHRM Awards 2017

- Tech Mahindra retains ranking in Dow Jones Sustainability Index 2017

- Features in 100 Best organizations in 2017 Working Mother & AVTAR Best Companies for Women in India

- Business World HR Excellence Award In Technology & Learning

- Best Company in terms of Information Security Implementation at the IT Innovation & Excellence Awards 2017 in the Annual Technology Conference held by CSI (Computer Society of India)

- BlockChain solution for State Bank of India wins the SKOCH Award 2017

- Recognized amongst world''s top 100 technology companies by Thomson Reuters

- 2018 AT&T Supplier Award for its outstanding performance and service to AT&T affiliates

ACKNOWLEDGEMENTS

Your Directors place on record their appreciation for the contributions made by employees towards the success of your Company. Your Directors gratefully acknowledge the co-operation and support received from the shareholders, customers, vendors, bankers, regulatory and Governmental authorities in India and abroad.

For and on behalf of the Board

Place: Mumbai Anand G. Mahindra

Date: May 25, 2018 Chairman


Mar 31, 2018

To,

The Members of

Mahindna & Mahindra Financial Services Limited

The Directors are pleased to present their Twenty-Eighth Report together with the audited financial statements of your Company for the Financial Year ended 31st March, 2018.

The performance highlights and summarised financial results of the Company are given below:

PERFORMANCE HIGHLIGHTS

Consolidated income for the year increased by 19% to Rs. 8,573.5 Crores as compared to Rs. 7,200.7 Crores in 2016-17;

Consolidated income from operations for the year was Rs. 8,533.1 Crores as compared to Rs. 7,146.2 Crores in 2016-17, a growth of 19%;

Consolidated profit before tax for the year was Rs.1,661.7 Crores as compared to Rs. 837.8 Crores in 2016-17;

Consolidated profit after tax and minority interest for the year was Rs. 1,023.9 Crores as compared to Rs.511.6 Crores in 2016-17.

FINANCIAL RESULTS

Rs. in Crores

CONSOLIDATED

STANDALONE

March 2018

March 2017

March 2018

March 2017

Total Income

8,573.5

7,200.7

7,206.1

6,237.5

Less : Finance Costs

3,426.3

3,186.2

3,000.4

2,857.4

Expenditure

3,481.0

3,123.0

2,853.7

2,714.0

Depreciation/Amortisation

55.2

53.7

44.2

46.0

Total Expenses

6,962.5

6,362.9

5,898.3

5,617.4

Profit Before Exceptional Items and Taxes

1,611.0

837.8

1,307.8

620.1

Exceptional Items (net) - income / (expense)

50.7

-

65.0

-

Profit Before Tax

1,661.7

-

1,372.8

-

Less : Provision For Tax

Current Tax

676.3

463.5

543.1

363.5

Deferred Tax

[66.0]

(155.4)

(62.2)

[143.6]

Profit After Tax for the Year before Minority Interest

1,051.4

529.7

891.9

400.2

Less : Minority Interest

27.5

18.1

-

-

Profit After Tax for the Year after Minority Interest

1,023.9

511.6

891.9

400.2

Add : Amount brought forward from Previous Years

2,850.5

2,522.4

2,489.0

2,240.5

Less: Corporate Dividend and Dividend Distribution Tax

164.3

2.8

161.0

-

Less: Transitional charge in respect of Mark to Market loss on derivative transactions

-

5.1

-

5.1

Amount available for Appropriation

3,710.1

3,026.1

3,219.9

2,635.6

Appropriations

General Reserve

88.4

40.0

89.2

40.0

Statutory Reserve

224.3

109.1

178.4

80.1

Debenture Redemption Reserve

50.5

26.5

50.5

26.5

Surplus carried to Balance Sheet

3,346.9

2,850.5

2,901.8

2,489.0

TRANSFER TO RESERVES

The Company proposes to transfer an amount of Rs. 89.2 Crores to the General Reserve, Rs.178.4 Crores to the Statutory Reserve and Rs.50.5 Crores to the Debenture Redemption Reserve. An amount of Rs.2,901.8 Crores is proposed to be retained in the Statement of Profit and Loss.

DIVIDEND

Your Directors are pleased to recommend a dividend of Rs. 4 per Equity Share of the face value of Rs. 2 each payable to those Members whose names appear in the Register of Members as on the Book Closure date. The dividend including dividend tax for the Financial Year 2017-18 will absorb a sum of Rs. 293.8 Crores [as against 161.0 Crores on account of dividend of Rs. 2.4 per Equity Share and tax thereon, paid for the previous year].

DIVIDEND DISTRIBUTION POLICY

The Board of Directors at its Meeting held on 25th October, 2016, approved and adopted the Dividend Distribution Policy, containing the requirements prescribed in Regulation 43A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Policy is appended as Annexure I and forms part of this Annual Report.

The Dividend Distribution Policy can also be accessed on the Company’s website at the web-link http://www.mahindrafinance.com/policies.aspx.

During the year, an amount of Rs.3,39,065 being the unclaimed/unpaid dividend of the Company for the Financial Year ended 31st March, 2010 was transferred in September, 2017 to the Investor Education and Protection Fund Authority.

OPERATIONS

After three years of subdued rural consumption, there were increasing signs of rural growth recovery with catalysts driving the awaited revival in rural demand. While two successive years of normal monsoon portend well for farm output, the combination of Minimum Support Price (MSP) hikes, direct benefit transfers and farm loan waivers contributed to disposable incomes. The rural sentiments turned positive and the Company did see an improvement in its performance, both in sales as well as overall collections.

Being largely engaged in the semi-urban and rural areas of the country, major part of the Company’s collection is in cash. Your Company however continues to educate its customers to adopt digital and online modes of repayment including Unified Payments Interface (UPI) and Aadhaar Enabled Payment System (AEPS).

While fulfilling its mission of Financial Inclusion, your Company has also built a deep knowledge of customers with micro-data points ranging from income, payment behaviours, socio-economic status and other indirect data. The Company is successfully mining this data to build powerful analytics models extended through digital platforms for customer acquisition, collections, NPA management, customer engagement, forecasting business trends, etc. Your Company has also successfully integrated India Stack capabilities like eKYC, eSign, etc., and digital payment channels in its platforms to serve customers even in low-connectivity remote locations. Among the early adopters of blockchain technology, your Company has in the year under review, launched a vendor financing platform powered by blockchain. This cloud based application is one of the first such blockchain-enabled projects in South Asia, outside of traditional banking.

Your Company remains a significant financier to its customers in rural and semi-urban geographies by providing a wide range of easy and affordable products and services. Your Company consolidated its position as a leading financier in all Aggregator and Self-drive vehicles segment. Your Company expanded vide its channel connect with leading car dealers, and yet again emerged as a major financier for Maruti vehicles in semi-urban and rural India during this fiscal. Your Company has retained its leadership position in financing the Mahindra range of vehicles and tractors in addition to extending its lending to vehicles of other Original Equipment Manufacturers (OEMs) and also continued to be the preferred financier for Hyundai, Renault and Nissan range of vehicles.

Your Company further expanded its geographical presence by reaching out to untapped villages and increased its footprint by opening new branches and making it more accessible to its customers. New financial products and services were introduced during the year, to meet various lifecycle needs of its customers and your Company focused on building additional skill sets and digital capabilities to meet such requirements. Your Company has also enhanced the offerings in-used tractor financing and agri-implements, thereby playing a key role in farm mechanisation across the country.

Your Company strengthened its pan-India presence with a network of 1,284 offices, which is one of the largest amongst Non-Banking Financial Companies. In addition to these offices, your Company has during the year under review, set up over 200 smart branches at dealerships of OEMs and works closely with dealers and customers. Your Company’s nationwide network of branches and locally recruited employees have facilitated in catering to the diverse financial requirements of its customers by identifying and understanding the needs and aspirations of the people.

With its strong presence covering even the most remote areas of the country, your Company is providing flexible financing opportunities to aspiring individuals to realise their dreams and helping them to ‘RISE’. Your Company believes that incessantly serving its customers and channel partners and enhancing customer relationship is the starting point of a great successful journey.

Your Company has earned the trust and confidence of its customers with its consistent, transparent and reliable services and as a result, customer satisfaction across its network continues to remain high. Your Company has cumulatively financed the aspirations of over 5.3 million customers since its inception, most of whom had no prior credit history. Your Company’s philosophy of helping rural customers by providing easy finance at their doorstep has given a big boost in transforming rural lives.

During the year under review, your Company continued to expand its reach in the Micro Small and Medium Enterprises (MSME) segment. MSME Assets Under Management crossed more than Rs. 4,988.04 Crores during the period under review, covering 3,017 customers.

In the year under review, the effect of demonetisation has substantially come down with improved availability of currency notes. Further with the stabilization of the Goods and Services Tax (GST) the temporary downward impact witnessed during the roll-out has been adequately addressed.

The overall disbursement registered a growth of 19% at Rs. 31,659.1 Crores as compared to Rs. 26,706.3 Crores in the previous year. Total Income grew by Rs. 968.6 Crores to Rs.7,206.1 Crores for the year ended 31st March, 2018 as compared to Rs.6,237.5 Crores for the previous year. Profit Before Tax (PBT) grew by Rs.752.6 Crores to Rs.1,372.7 Crores as compared to Rs. 620.1 Crores for the previous year. Profit After Tax (PAT) increased by Rs. 491.7 Crores to Rs.891.9 Crores as compared to Rs.400.2 Crores in the previous year

During the year under review, the Assets Under Management stood at Rs. 55,101 Crores as at 31st March, 2018 as against Rs. 46,776 Crores as at 31st March, 2017, a growth of 18%.

There is no change in the nature of business of the Company during the year under review.

DISTRIBUTION OF MUTUAL FUND PRODUCTS

During the year under review, the activity of distribution of Mutual Fund Products (MFP) was carried out across 161 branches covering 23 States.

As on 31st March, 2018, the amount of Assets Under Management outstanding through the Company’s Distribution Services on MFP aggregate of institutional and retail segment, was Rs. 2,331.40 Crores and the number of clients stood at 59,506.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

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

CORPORATE GOVERNANCE

Your Company practices a culture that is built on core values and ethical governance practices. Your Company is committed to transparency in all its dealings and places high emphasis on business ethics. 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 in Regulations 17 to 27, clauses (b) to (i) of sub-regulation (2) of Regulation 46 and paragraphs C, D and E of Schedule V of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements] Regulations, 2015, forms part of the Annual Report.

SHARE CAPITAL

During the year under review, your Company received the approval of its shareholders to issue upto 2.5 Crores Equity Shares by way of Preferential Allotment to its promoter, Mahindra & Mahindra Limited (“Promoter”) and upto 2.4 Crores Equity Shares by way of Qualified Institutions Placement (“QIP”) and successfully raised a total of Rs. 2,111 Crores through the above issuances made to both its Promoter and a mix of domestic and international Qualified Institutional Buyers.

Preferential Allotment

The Company made a preferential allotment of 2,50,00,000 Equity Shares on 30th November 2017, to its holding company, Mahindra & Mahindra Limited at a price of Rs.422 per Equity Share, including a premium of Rs. 420 per Equity Share, raising a sum of Rs.1,055 Crores.

Qualified Institutions Placement (QIP)

On 7th December, 2017, your Company successfully concluded the QIP issue to Qualified Institutional Buyers aggregating Rs. 1,056 Crores through the issue of 2,40,00,000 Equity Shares of the Face Value of Rs. 2 each at an issue price of Rs. 440 per Equity Share including a premium of Rs. 438 per Equity Share, which is a premium to the price of Rs. 439.63 per share, arrived at as per Regulation 85 of Securities and Exchange Board of India [Issue of Capital and Disclosure Requirements] Regulations, 2009. The QIP launched by your Company received an overwhelming response, as seen by the issue being subscribed multiple times and the strong participation from renowned International and Domestic Institutional Investors.

Consequent to the Preferential Allotment and QIP the issued, subscribed and paid-up Equity Share Capital of the Company stood at Rs.123.55 Crores as at 31st March, 2018, comprising of 61,77,64,960 Equity Shares of the face value of Rs. 2 each, fully paid-up.

With the Promoter maintaining majority shareholding, your Company continues to benefit by leveraging the financial and operational synergies with its Promoter and with the simultaneous QIP issuance, it has been able to diversify its investor base.

Your Company has duly utilised the issue proceeds raised through the Preferential Issue and QIP to augment its long-term resources for meeting business growth and funding requirements, strengthen its capital adequacy, make investments in its Subsidiaries and Joint Venture, for other general corporate purposes and for payment of Issue expenses. This is in line with the issue purpose mentioned in the Explanatory Statement of the Notice of the Extraordinary General Meeting dated 1st November, 2017 and the Placement Document filed with various Regulatory Authorities. Details of these Issues and the end use of funds were furnished to the Audit Committee.

During the year under review, your Company has neither issued shares with differential rights as to dividend, voting or otherwise, nor has issued sweat equity, other than Employee Stock Options under the Employees’ Stock Option Scheme referred to in this Report, during the year under review.

As on 31st March, 2018, none of the Directors of the Company holds instruments convertible into Equity Shares of the Company.

STOCK OPTIONS

During the year under review, on the recommendation of the Nomination and Remuneration Committee of your Company, the Trustees of the Mahindra & Mahindra Financial Services Limited Employees’

Stock Option Trust have granted 62,130 Stock Options to Eligible Employees under the Mahindra & Mahindra Financial Services Limited Employees’ Stock Option Scheme-2010 [“2010 Scheme”]. No new Options have been granted under the Mahindra & Mahindra Financial Services Limited Employees’ Stock Option Scheme-2005 [“2005 Scheme”] [hereinafter collectively referred to as “the Schemes”]. The Company does not have any scheme to fund its employees to purchase the shares of the Company. No employee has been issued stock options during the year, equal to or exceeding 1% of the issued capital of the Company at the time of grant.

The Schemes of the Company are in compliance with the Securities and Exchange Board of India [Share Based Employee Benefits] Regulations, 2014 [“SBEB Regulations”] and there were no material changes made to the said Schemes. Messrs. B S R & Co. LLP, Chartered Accountants, Statutory Auditors of the Company, have certified that the abovementioned Schemes have been implemented in accordance with the SBEB Regulations, and the Resolutions passed by the Members for the 2005 Scheme and the 2010 Scheme. The Certificate would be placed at the Annual General Meeting for inspection by Members.

Voting rights on the Shares issued to employees under the aforesaid Schemes are either exercised by them directly or through their appointed proxy.

The details of the Employees’ Stock Options and the Company’s Employees’ Stock Option Trust as required under the SBEB Regulations read with SEBI Circular CIR/CFD/ POLICY CELL/2/2015 dated 16th June, 2015 have been uploaded on the Company’s website and can be accessed at the web-link: http://www. mahindrafinance.com/annual-reports.aspx.

ECONOMY

Global

At 3.8 percent, global growth last year was 0.5 percentage point faster than in 2016 and the strongest since 2011. Two-thirds of countries accounting for about three-fourths of global output experienced faster growth in 2017 than in the previous year [the highest share of countries experiencing a year-over-year growth pickup since 2010]. The preliminary outcome for global growth in 2017 was 0.2 percentage point stronger than forecast, in the October 2017 World Economic Outlook [WEO], with upside surprises in the second half of 2017 in advanced as well as emerging markets and developing economies.

Resurgent investment spending in advanced economies and an end to the investment decline in some commodity exporting emerging markets and developing economies were important drivers of the uptick in global GDP growth and manufacturing activity. Across advanced economies, the 0.6 percentage point pickup in 2017 growth relative to 2016 is explained almost entirely by investment spending, which remained weak since the 2008-09 global financial crisis and was particularly subdued in 2016. Both stronger gross fixed capital formation and an acceleration in stock building contributed to the pickup in investment, with accommodative monetary policy, stronger balance sheets, and an improved outlook helping release pent-up demand for capital goods.

Global growth is projected to strengthen from 3.8 percent in 2017 to 3.9 percent in 2018 and 2019, driven by a projected pickup in growth in emerging markets and developing economies and resilient growth in advanced economies. The forecast for 2018 and 2019 is stronger than in the October 2017 WEO by 0.2 percentage point for each year, with positive revisions compared with the October 2017 WEO for emerging markets and developing economies and especially for advanced economies. The global effects of US fiscal policy changes account for almost half of the global growth upgrade for 2018-19 compared with October. Beyond 2019, global growth is projected to gradually decline to 3.7 percent by the end of the forecast horizon. The slowdown is entirely because of advanced economies, where growth is projected to moderate in line with their modest potential growth; growth across emerging markets and developing economies is expected to stabilize close to the current level. (Source: IMF)

Domestic

Domestic economic activity shrugged off the loss of speed that had characterised the period Q1:2016-17 to Q1:2017-18 and a turning point appears to have taken hold in Q2-Q3, with lead indicators pointing to further acceleration in Q4. In terms of aggregate demand, the drivers around this inflexion are shifting, with consumption-led growth of the recent past handing over the baton to investment, which had restrained growth since Q3:2016-17. At the same time, the strong impetus from fiscal spending during Q3:2016-17 to Q1:2017-18 appears to be waning and the rapid pace of import growth is sapping net external demand. On the supply side, the pickup in industrial output from Q2:2017-18 and the strengthening of construction activity in the services sector from Q1 are noteworthy. Meanwhile, agriculture and allied activities have turned out to be resilient to temporary weather disruptions in both kharif and rabi sowing seasons and going by recent estimates of foodgrains production, the outlook appears better than before.

Consumer price inflation rose sharply in Q3:2017-18, driven up by a spike in food prices and by the disbursement of enhanced House Rent Allowance (HRA) for central government employees, the latter alone contributing an estimated 35 basis points. It moderated somewhat in Q4 on a delayed seasonal easing of prices of vegetables. Industrial input costs increased through H2:2017-18, tracking movements in international commodity prices. Wage pressures have remained moderate in both the organised and rural sectors. The increase in HRA for central government employees, which became effective from July 2017 and continued to accumulate till December 2017, shaped the path of headline inflation during Q3, with unseasonal hardening of prices of vegetables, accentuating a spike to 4.9 per cent in November. While prices of vegetables did undergo a shallower than usual moderation in December, an unfavourable base effect came into play, pulling up inflation to a peak of 5.2 per cent in December. In Q4, headline inflation moderated with a fall in momentum due to a delayed but steep reversal in prices of vegetables.

A stark feature of India’s recent growth experience has been the protracted downturn in investment, however, a turnaround set in during Q2:2017-18. Gross Fixed Capital Formation (GFCF) strengthened further to touch a six-quarter high in Q3. The share of GFCF in GDP, which was trapped in a downturn from a high of 34.3 per cent in 2011-12 to 30.3 per cent in 2015-16, broke free and increased to 31.4 per cent in 2017-18. As alluded to earlier, this pick-up in the investment rate could be signalling a turning point in the cyclical component of growth oscillations in India and if sustained by a determined policy push, it could produce a level shift in the trajectory of the Indian economy. Capital goods production - a key element of investment demand - turned around in August 2017 and clocked a 19-month high in terms of growth rates in January 2018. During 2017-18 so far (up to December), the construction of highway projects is on the rise and is expected to have improved further in Q4.

Going forward, a key risk to the inflation outlook is the risk of fiscal slippages in a scenario of rising aggregate demand. As noted in the MPC resolution of February 2018, apart from the direct impact on inflation, the fiscal risks could also engender a broader weakening of macro-financial conditions. The revised guidelines for arriving at the MSPs for kharif crops proposed in the Union Budget 2018-19, along with proposed increase in customs duty on a number of items, is likely to pushup inflation over the year. In addition, how various state governments implement and disburse HRA increases would have a considerable bearing on CPI housing inflation and consequently on the headline inflation trajectory, albeit statistically, during 2018-19; therefore, the latter should be looked through for monetary policy purposes, other than for their second-round effects. Although the central government’s HRA effects on CPI inflation would gradually wane from July 2018, this moderating impact could be more than offset if several state governments simultaneously implement HRA increases in H2:2018-19. (Source: RBI)

Finance

During the current year, the Reserve Bank of India (RBI) held six Bi-monthly Monetary Policy Committee meetings. The Policy Repo rates under the Liquidity Adjustment Facility (LAF) was at 6.25% at the beginning of the year. During the year, the RBI reduced the Policy Repo rates by 0.25% once in its third Bi-monthly Monetary Policy Committee meeting to 6.00% and since then maintained at such levels.

Yields in the government securities (G-Sec) has shown continuous increase through the year since the reduction of policy rates. Yields on the 10 year benchmark paper has increased by around 150 bps from the lows. A sharp reduction in G-Sec yields were seen in the month of March when the government announced its intent to reduce its borrowing in the first half. However the reduced rates were short lived and within a month the yields were higher than preannouncement. An important element of the yield rising has been the continuous rise in the crude prices (nearing -80/barrel). The depreciation of rupee is not helping either which shall lead to inflationary pressure which together is resulting in rising yields.

Private Placement Issues of Non-Convertible Debentures

During the year under review, your Company issued secured redeemable non-convertible debentures (“NCDs”) aggregating to Rs. 4,497.80 Crores on a private placement basis, in various tranches.

As specified in the respective offer documents, the funds raised from NCDs were utilised for the purpose of financing, repayment of dues of other financial institutions/Banks or for long term working capital.

Public Issuance of Non-Convertible Debentures

Your Company continues to broaden the liability mix by bringing in new instruments as well as diversifying the investor base and profile. During the year under review, your Company successfully raised Rs. 1,150.5 Crores through its second public issuance of 1,15,05,313 Unsecured Subordinated Redeemable Non-Convertible Debentures (“NCDs”) of face value of Rs. 1,000 each. With this issuance, approximately 5% of your Company’s borrowing is funded through this instrument. The NCDs were allotted on 24th July, 2017 and listed on BSE Limited on 26th July, 2017.

The net proceeds received from the Public Issue were used for the purpose of onward lending, financing, refinancing the existing indebtedness of the Company, long term working capital requirements, Issue expenses and for general corporate purposes. Details of the Issue and the end use were furnished to the Audit Committee.

The Company has been regular in making payments of principal and interest on the NCDs. There are no NCDs which have not been claimed by investors or not paid by the Company after the date on which the NCDs became due for redemption.

Rupee Denominated Medium Term Note (MTN)

As a risk management measure diversification of its resources is one of the focus areas of the Company. To this end, your Company has received approval from the Reserve Bank of India for issuance of Masala Bonds. Your Company has also updated its Offering Circular of Rupee Denominated Medium Term Note (MTN) programme, listed on the Singapore Exchange Securities Trading Limited, and subject to market conditions, plans to issue bonds under the MTN programme during the current year.

INVESTOR RELATIONS

Your Company continuously endeavors to improve its engagement with Domestic and International investors/analysts through multiple mechanisms, including structured conference-calls, individual meetings, Telepresence meetings, participating in investor conferences and undertaking quarterly and annual earnings calls. Your Company attended multiple investor meets organised by reputed Global and Domestic Broking Houses during the year, both in India and abroad, to communicate details of its performance, important regulatory and market developments and exchange of information. These interactions with institutional shareholders, fund managers and analysts are based on generally available information that is accessible to the public on a non-discriminatory basis. Your Company uploads the transcript of the quarterly earnings call on its website which can be accessed by existing and potential investors and lenders.

Your Company believes in transparent communication and building a relationship of mutual understanding and trust. Your Company further ensures that critical information about the Company is available to all the investors by hosting all such information on the Company’s website.

CAPITAL ADEQUACY

Consequent upon the allotment of Equity Shares issued on a Preferential Allotment basis to the Promoter and through a Qualified Institutions Placement to Qualified Institutional Buyers, the paid-up share capital of the Company has increased to Rs.123.6 Crores as on 31st March, 2018 from Rs. 113.8 Crores as on 31st March, 2017. The securities premium account has also increased to Rs. 4,113.2 Crores from Rs.2,025.6 Crores.

As a result of the increased net worth, your Company was able to enhance the Capital to Risk Assets Ratio (CRAR) to 21.9 % as on 31st March, 2018, well above the minimum requirement of 15% CRAR prescribed by the Reserve Bank of India. Out of the above, Tier I capital adequacy ratio stood at 16.0% and Tier II capital adequacy ratio stood at 5.9%, respectively.

RBI GUIDELINES

The Company has complied with all the applicable regulations of the Reserve Bank of India (RBI).

As a prudent practice, your Company makes accelerated provisioning for Non-Performing Assets (NPAs) than that required by RBI for NBFCs. Your Company continues to make a general provision at 0.40% on the standard assets outstanding as mandated by the RBI.

DISCLOSURE PERTAINING TO GOLD LOAN AUCTION(S)

During the fiscal 2016-17, your Company conducted the auction of its Gold Stock and sold the entire stock. With this auction the Company has closed its entire gold loan business.

CREDIT RATING

The credit rating details of the Company as on 31st March, 2018 were as follows:

Rating Agency

Type of Instrument

Rating*

Remarks

India Ratings & Research Private Limited

Commercial Paper Programme

‘IND A1 ’

The ‘A1 ’ rating indicates the Highest Level of Rating. Instruments with this rating are considered to have very strong degree of safety regarding timely payment of financial obligations. Such instruments carry lowest credit risk.

Long-term Debt Instruments and Subordinated Debt Programme

‘IND AAA/Stable’

CARE Ratings Limited (Formerly known as Credit Analysis & Research Limited)

Long-term Debt Instruments and Subordinated Debt Programme

‘CARE AAA/Stable’

The ‘AAA’ ratings denote the highest degree of safety regarding timely servicing of financial obligations. Such instruments carry lowest credit risk.

Brickwork Ratings India Private Limited

Long-term Subordinated Debt Programme

‘BWR AAA/Stable’

CRISIL Limited

Fixed Deposit Programme

‘CRISIL FAAA/Stable’

Long-term Debt Instruments, Subordinated Debt Programme and Bank Facilities

‘CRISIL AA /Stable’

The ‘AA ’ rating indicates a high degree of safety with regard to timely payment of financial obligations. Such instruments carry very low credit risk.

Short-term Debt and Bank Loans

‘CRISIL A1 ’

The ‘A1 ’ rating indicates the Highest Level of Rating. Instruments with this rating are considered to have very strong degree of safety regarding timely payment of financial obligations. Such instruments carry lowest credit risk.

* The ratings mentioned above were reaffirmed by the Rating Agencies during the Financial Year 2017-18. With the above rating affirmations, your Company continues to enjoy the highest level of rating from all major rating agencies at the same time.

ACHIEVEMENTS

Your Company won several awards and accolades during the year under review. Select few awards/ recognition are enumerated hereunder:

Corporate Governance

India’s Most Trusted Companies Awards 2017” as per the Research Report 2017 by Media Research Group, MRG.

Listed amongst the top 10 companies with a high Corporate Governance score in a study jointly conducted by International Finance Corporation (IFC), BSE Limited (BSE) and Institutional Investor Advisory Services (IiAS).

Business & Marketing:

- Ranked 108th in the “Dun & Bradstreet India’s Top 500 Companies 2017” based on Net Profit.

- Adjudged as one of the “Best BFSI Brands 2018” by the Economic Times.

- Award for the ‘Most Effective use of Direct Marketing to Rural Consumers’ at the Rural Marketing Forum & Awards 2018 for MF SUTRADHAAR initiative.

Ranked 13th based on Total Income in “Dun & Bradstreet India’s Leading BFSI Companies 2018” among NBFCs, Financial Institutions and Financial Services Companies.

Won the PRCI (Public Relations Council of India) Collateral Awards 2018 in the following categories:

a. Crystal Award for Corporate Advertising Campaign (SME Ad campaign)

b. Crystal Award for Radio/Jingle (SME Radio Campaign)

c. Gold Award for Rural or Development -Communication (MF SUTRADHAAR Program)

d. Gold Award for Financial Communication (Suvidha Loans Communication Campaign)

e. Silver Award for Radio Communication (SME Radio Campaign)

f. Appreciation Award for Diary 2018

g. Appreciation Award for In-house Digital Newsletter (In-box Select)

h. Appreciation Award for Annual Report

Human Resources

Listed in Aon Best Employer List 2017, as Aon Best Employer

Certified Top 50 India’s Best Companies to Work for - 2017 by Great Place to work.

Adjudged Runner-up in the BusinessWorld HR Excellence Award 2017 by BusinessWorld.

“Best Learning & Development Strategy Award” at World HRD Congress 2017.

Listed in the Avtar and Working Mothers Best Companies to work for.

Appeared in Top 100 Record Holders for Excellence in Learning Sessions.

Attained Level 5 certification for People Capability Maturity Model (PCMM) Level 5.

CSR & Sustainability

Honoured with IDF CSR Award by Indian Development Foundation (IDF) for excellent participation in Resource Mobilization for Humanitarian Projects.

Bestowed with the Equal Opportunity Employer Award by Sarthak Educational Trust for ensuring equal employment opportunities and sustainable employment prospects to person with disability.

Listed in Dow Jones Sustainability Index (DJSI) Emerging Markets category for the 5th consecutive year.

Included in the “Sustainability Yearbook 2018” released by RobecoSAM, being the only Indian Financial Company in Diversified Financial Services and Capital Markets sector to be selected.

Information & Technology

Pride of India Award” for Best Enterprise Learning Platform

FIXED DEPOSITS AND LOANS/ ADVANCES

Your Company offers a bouquet of Fixed Deposit schemes to suit the investment needs of various classes of investors. These Deposits carry attractive interest rates with superior service enabled by robust processes and technology. In order to tap rural and semi-urban savings and reach out to the farthest customers, your Company continues to expand its network and make its presence felt in the most remote areas of the country.

During the year, CRISIL has reaffirmed a rating of ‘CRISIL FAAA/Stable’ for your Company’s Fixed Deposits. This rating represents the highest degree of safety regarding timely servicing of financial obligations and carries the lowest credit risk. Your Company’s deposits continue to be a preferred investment amongst the investors.

As on 31st March, 2018, your Company has mobilised funds from Fixed Deposits to the tune of Rs. 3,137.37 Crores, with an investor base of over 1,30,413 investors.

Your Company continues to serve the investors by introducing several customer centric measures on an ongoing basis to further strengthen its processes in sync with the requirements of the Fixed Deposit holders. The Company communicates various intimations via SMS, e-mails, post, etc., to its investors as well as sends reminder emails to clients whose TDS is likely to be deducted before any payout/ accrual. Your Company also provides online renewal facility, online generation of TDS certificates from customer/broker portal and Seamless Investment process for employees.

During the year under review, your Company has rolled out several initiatives aimed at offering a superior customer experience. Some key ones are:

Increased the number of offices from 198 in the previous fiscal to 304 offices in the current fiscal for collection of Fixed Deposits.

Customer self-profile update on the Fixed Deposit-Customer Portal available on the Company’s website.

Default auto renewal of Fixed Deposits option to facilitate timely renewal of deposits in case the physical request for renewal of Deposits is not received four weeks prior to the maturity date.

Introduced online Swift Loan[s] against Deposits.

Convenience of investment made available through mobile phones.

As at 31st March, 2018, 4,662 deposits amounting to Rs. 8.61 Crores had matured for payment and remained unclaimed. The unclaimed deposits have since reduced to 3,761 deposits amounting to Rs. 6.10 Crores. There has been no default in repayment of deposits or payment of interest during the year.

Your Company being a Non-Banking Financial Company, the disclosures required as per Rule 8 [5] [v] and [vi] of the Companies [Accounts] Rules, 2014 read with sections 73 and 74 of the Companies Act, 2013, are not applicable to it.

The information pursuant to Clause 35[1] of Master Direction DNBR.PD.002/03.10.119/2016-17 dated 25th August, 2016 issued by Reserve Bank of India on Non-Banking Financial Companies Acceptance of Public Deposits [Reserve Bank] Directions, 2016, regarding unpaid/unclaimed public deposits as on 31st March, 2018, is furnished below:

i. total number of accounts of public deposits of the Company which have not been claimed by the depositors or not paid by the Company after the date on which the deposit became due for repayment: 4,662.

ii. the total amounts due under such accounts remaining unclaimed or unpaid beyond the dates referred to in clause [i] as aforesaid: Rs. 8,60,67,196.

Depositors were intimated regarding the maturity of deposits with a request to either renew or claim their deposits. Your Company continues to send intimation letters via registered post every 3 months to all those Fixed Deposit holders whose deposits have matured as well as to those whose deposits remain unclaimed. Where the Deposit remains unclaimed, follow-up action is also initiated through the concerned agent or branch.

Pursuant to section 125[2] [i] of the Companies Act, 2013 read with the Investor Education and Protection Fund Authority [Accounting, Audit, Transfer and Refund] Rules, 2016 [“the IEPF Rules”] as amended from time to time, matured Deposits remaining unclaimed for a period of seven years from the date they became due for payment are required to be transferred to the Investor Education and Protection Fund [IEPF] Authority established by the Central Government. The concerned depositor can claim the Deposit from the IEPF Authority by following the procedure laid down in the IEPF Rules.

During the year, an amount of Rs.0.02 Crores has been transferred to the IEPF Authority.

During the year under review, the Company has not given any loans and advances in the nature of loans to its subsidiaries or associate or loans and advances in the nature of loans to firms/companies in which Directors are interested.

Accordingly, the disclosure of particulars of loans/ advances, etc., as required to be furnished in the Annual Accounts of the Company pursuant to Regulation 34 read with paragraph A of Schedule V of the SEBI [Listing Obligations and Disclosure Requirements] Regulations, 2015 is not applicable to the Company.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS IN SECURITIES

Pursuant to section 186[11] of the Companies Act, 2013 [“the Act”], the provisions of section 186 [4] of the Act requiring disclosure in the Financial Statements of the full particulars of the loans made and guarantees given or securities provided by a NonBanking Financial Company in the ordinary course of its business 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 exempted from disclosure in the Annual Report.

Further, pursuant to the provisions of section 186 (4) of the Act, the details of investments made by the Company are given in the Notes to the Financial Statements.

SUSTAINABILITY INITIATIVES

Sustainability has always been a key success factor for the ambit of the Company’s businesses. Through its unique business model the Company is making a difference in the lives of many by addressing the essential requirements of people in rural and semi-urban parts of India. Your Company’s businesses focus on key necessities of people and enable them to meet their aspirations through a wide-range of financial products and services offered by it. By providing the right set of opportunities in the remote areas and handholding its customers to advance in their lives, your Company continues to make positive contribution to multiple stakeholders. Your Company lays strong emphasis on customer centricity with its customer base spread across more than 3.5 Lakh villages in India with majority of them belonging to the earn and pay segment.

Your Company commenced its journey towards reporting sustainability performance since 2008-09 through Mahindra Group’s Sustainability Report and in the year 2012-13 your Company released its first standalone Sustainability Report. In the reporting year the Company released its fifth Sustainability Report for the Financial Year 2016-17 with the theme ‘Towards Value Creation’ based on the Global Reporting Initiative’s (GRI) G4 Guidelines which highlights its progress and efforts on creating long term benefits and opportunities on social, environmental and economic dimensions for all its stakeholders. This Report is hosted on your Company’s website at the web-link: www.mahindrafinance.com/sustainability.aspx.

Your Company continued to focus on sustainability awareness for different stakeholders by building on the initiatives of the previous years as also initiating new ones. In the year under review, your Company formulated its Sustainability Policy and developed a new Sustainability Roadmap aligned to the Mahindra Group’s Sustainability Framework to ensure mutual initiatives for sustainability across the Group. Interventions on energy efficiency, technology deployment and waste management have been taken throughout the reporting year at different locations. The Company continued its focus on encouraging employees and field staff in adopting Road Safety measures.

Your Company has been listed on the Dow Jones Sustainability Index (DJSI) Emerging Market Trends for the fifth consecutive year. Your Company is the only Company from amongst the Diversified Financial Services Companies in India to have made it to this list. To be incorporated in DJSI, companies are assessed and selected based on their long term Environmental, Social and Governance (ESG) management plans. Your Company got selected in ‘The Sustainability Yearbook’ 2018 being the only Financial Services Sector Company to qualify amongst 9 companies from India. This signifies your Company being amongst the top Sustainability performers in Diversified Financial Services Sector across the world based on Corporate Sustainability Assessment done by RobecoSAM.

In addition to this, your Company continues to report on Carbon Disclosure Project (CDP) since the Financial Year 2011-12. CDP seeks information on management of carbon emissions covering world’s largest companies and how they are geared up to mitigate challenges pertaining to climate change and global warming in future. During the reporting year, your Company retained CDP Performance Band - B which affirms that the Company is taking coordinated action on climate change issues. Your Company made proactive efforts to reduce CO2 emissions (carbon footprint) through Project ‘Mahindra Hariyali’, by planting over 1.2 Lakh saplings throughout the country.

Your Company is gearing up to be future ready by making sustainability and climate change an integral part of the risk framework and taking measures to mitigate and manage them. Weather reports are assessed on a regular basis and aligned with business operations to protect the customers and minimise the risk impact. Your Company is well equipped to enable its customers and communities progress through its inclusive and sustainable business model.

BUSINESS RESPONSIBILITY REPORT

The ‘Business Responsibility Report’ (BRR) of your Company for the year 2017-18 forms part of this Annual Report as required under Regulation 34(2)(f) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 and is appended as Annexure II. Your Company is building an inclusive organization by engaging with stakeholders and creating value in the ecosystem it operates in. Your Company’s businesses focus on the key necessities of people and enable them to earn their livelihood through its varied portfolio of financial products and services. Through its wide network of branches with locally-recruited employees, strong and lasting relationships with its stakeholders, large customer base, vast experience and market knowledge, your Company is providing financial resources to underserviced regions of the country and building livelihood for such sections of the population, who are aspiring for a better living in the villages.

The BRR can also be accessed on the Company’s website at the web-link: www.mahindrafinance. com/sustainability.aspx.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

With an objective to empower rural India and transform the rural landscape, your Company during the year, continued to undertake several initiatives in the key thrust areas of Healthcare, Education (including Livelihood) and Environment. It is only through these sustained and consistent efforts that your Company can build and consolidate its CSR initiatives which contribute to nation building.

In the year under review, your Company organised a nationwide blood donation drive, conducted health check-up camps, Swachh Bharat activities, visits to Municipal schools, orphanages, differently-abled homes and old-age homes to re-affirm its pledge to the society.

Your Company also contributed to the environment through planting of over one Lakh trees thus helping restore the diminishing green cover in the country. In the area of public health, your Company sponsored Lifeline Express, a hospital on wheels program, through which medical care and treatment was provided to communities who do not have access to any medical facilities. The Lifeline Express executed in association with Impact India Foundation, catered to the medical needs of 8,010 underprivileged people in Balharshah, in the State of Maharashtra.

In an effort to unleash the potential of the rural population, during the year your Company implemented some of the notable ongoing projects such as providing scholarships to 2,500 undergraduate and 500 graduate students, conducting vocational training for 513 rural youths and Drivers’ training for 220 women, setting-up a vocational skill building center with an aim to train 250 People with Disability and a donation of 14 ambulances that have made access to primary healthcare centers easy for 12,000 tribal and rural patients across the nation. Your Company has expanded the Medical Equipment Donation project to contribute equipment to 30 family planning centers and supported the maintenance of two more Thalassemia Day Care Centers apart from the four existing ones in Maharashtra and one in Jharkhand. Additionally, in the area of healthcare, your Company contributed for the launch of a Maternal & Child Health Care project which provides nutritional supplementation to anemic pregnant and lactating women, adolescents and malnourished children in the areas of Singbhum (Jharkhand), Bhubaneswar (Odisha), Palghar and Thane (Maharashtra).

In the year under review, your Company continued to provide assistance to over 9,400 Nanhi Kalis which supports the education of underprivileged girls. Your Company also continued its commitment to projects such as Mahindra Pride Schools, which helped in providing livelihood training to 2,612 youths from socially and economically disadvantaged communities.

During the year under review, your Company has spent Rs. 27.16 Crores on CSR projects/programs. 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. 27.07 Crores. Your Company is in compliance with the statutory requirements in this regard.

CSR COMMITTEE

The CSR Committee presently comprises of Mr. Piyush Mankad (Chairman), Mr. Ramesh Iyer, Mr. V. Ravi and Dr. Anish Shah. The Committee, inter alia, monitors the CSR activities.

CSR POLICY

The CSR Policy of the Company is hosted on the Company’s website at the web-link: http://www. mahindrafinance.com/csr.aspx and a brief outline of the CSR Policy and the CSR initiatives undertaken by the Company during the year as per Annexure prescribed in the Companies (Corporate Social Responsibility Policy) Rules, 2014 have been appended as Annexure III to this Report.

EXTRACT OF ANNUAL RETURN

Pursuant to sub-section 3(a) of section 134 and subsection (3) of section 92 of the Companies Act, 2013, read with Rule 12 of the Companies (Management and Administration) Rules, 2014, an extract of the Annual Return as at 31st March, 2018 forms part of this Report and is appended as Annexure IV.

BOARD MEETINGS, ANNUAL GENERAL MEETING AND EXTRAORDINARY GENERAL MEETING

The calendar of the Board/Committee Meetings and the Annual General Meeting is circulated to the Directors in advance to enable them to plan their schedule for effective participation at the respective meetings. Additional Board Meetings are convened by giving appropriate notice to address business exigencies. At times certain decisions are taken by the Board/Committee through circular resolutions.

All the decisions and urgent matters approved by way of circular resolutions are placed and noted at the subsequent Board/Committee Meeting.

The Board of Directors met seven times during the year under review, on 25th April, 2017, 24th July, 2017, 6th October, 2017, 25th October, 2017, 1st November, 2017, 24th January, 2018 and 16th March, 2018. The requisite quorum was present for all the Meetings. The maximum time gap between any two Meetings was not more than one hundred and twenty days. These Meetings were well attended. The 27th Annual General Meeting [AGM] of the Company was held on 24th July, 2017.

During the year under review, an Extraordinary General Meeting [EGM] of the Members was held on 29th November, 2017 to approve the issuance of Equity Shares on Qualified Institutions Placement to Qualified Institutional Buyers, approve Related Party transaction for Preferential Issue of Shares to Mahindra & Mahindra Limited [M&M], the holding company and accord consent for issue of Equity Shares to M&M on a Preferential Allotment basis.

Detailed information on the Meetings of the Board, its Committees, the AGM and EGM is included in the Report on Corporate Governance, which forms part of this Annual Report.

MEETINGS OF INDEPENDENT DIRECTORS

The Independent Directors met twice during the year under review, on 23rd January, 2018 and 15th March, 2018. The Meetings were conducted in an informal manner without the presence of the Wholetime Directors, the Non-Executive Non-Independent Directors, or any other Management Personnel.

COMMITTEES OF THE BOARD OF DIRECTORS

The Company has various Committees which have been constituted as a part of good corporate governance practices and the same are in compliance with the requirements of the relevant provisions of applicable laws and statutes.

Your Company has an adequately qualified and experienced Audit Committee with Mr. C. B. Bhave as the Chairman and Mr. Dhananjay Mungale, Mr. M. G. Bhide, Ms. Rama Bijapurkar, Mr. Piyush Mankad, Mr. V S. Parthasarathy and Dr. Anish Shah as Members.

The recommendations of the Audit Committee were duly approved and accepted by the Board during the year under review.

The other Committees of the Board are:

i] Nomination and Remuneration Committee

ii] Stakeholders Relationship Committee

iii] Corporate Social Responsibility Committee

iv] Risk Management Committee

v] Asset Liability Committee

vi] Committee for Strategic Investments

vii] IT Strategy Committee

The details with respect to the composition, powers, roles, terms of reference, Meetings held and attendance of the Directors at such Meetings of the relevant Committees are given in detail in the Report on Corporate Governance of the Company which forms part of this Annual Report.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

Directors

Dr. Anish Shah, Non-Executive Non-Independent Director, retires by rotation at the forthcoming Annual General Meeting and, being eligible, offers himself for reappointment. The detailed profile of Dr. Anish Shah has been included in the Notice convening the ensuing AGM.

All the Directors of the Company have confirmed that they satisfy the fit and proper criteria as prescribed under paragraph 69[1][iv] of Chapter XI of RBI Master Direction No. DNBR. PD. 008/03.10.119/2016-17 dated 1st September, 2016 and that they are not disqualified from being appointed as Directors in terms of section 164[2] of the Companies Act, 2013.

None of the Independent Directors are due for re-appointment.

Key Managerial Personnel

Mr. Ramesh Iyer, Vice-Chairman & Managing Director, Mr. V Ravi, Executive Director & Chief Financial Officer and Ms. Arnavaz M. Pardiwalla, Company Secretary of the Company have been designated as the Key Managerial Personnel of the Company [KMP] pursuant to the provisions of sections 2[51] and 203 of the Companies Act, 2013 read with the Companies [Appointment and Remuneration of Managerial Personnel] Rules, 2014.

There has been no change in the KMP during the year under review.

Declaration by Independent Directors The Company has received declarations from all the Independent Directors of the Company confirming that they fulfill the criteria of independence as prescribed under sub-section [6] of section 149 of the Companies Act, 2013 and the Securities and Exchange Board of India [Listing Obligations and Disclosure Requirements] Regulations, 2015.

Directors’ Responsibility Statement

Pursuant to the provisions of section 134[5] of the Companies Act, 2013, [“the Act”] your Directors, based on the representations received from the Operating Management and after due enquiry, confirm that:

i. i n the preparation of the annual accounts for financial year ended 31st March, 2018, the applicable accounting standards have been followed and there are no material departures in adoption of these standards.

ii. they have in consultation with the Statutory Auditors selected such 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 31st March, 2018 and of the profit of the Company for the year ended on that date.

iii. they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

iv. they have prepared the annual accounts for financial year ended 31st March, 2018 on a going concern basis.

v. they have laid down adequate internal financial controls to be followed by the Company and that such internal financial controls were operating effectively during the financial year ended 31st March, 2018.

vi. they have devised proper systems to ensure compliance with provisions of all applicable laws and that such systems were adequate and operating effectively during the financial year ended 31st March, 2018.

Performance Evaluation of the Board

The Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“the Listing Regulations”) stipulate the evaluation of the performance of the Board, its Committees, Individual Directors and the Chairperson.

The Company has formulated a Policy for performance evaluation of the Independent Directors, the Board, its Committees and other individual Directors which includes criteria for performance evaluation of the Non-Executive Directors and Executive Directors.

The evaluation framework for assessing the performance of Directors comprises of various key areas such as attendance at Board and Committee Meetings, quality of contribution to Board discussions and decisions, strategic insights or inputs regarding future growth of the Company and its performance, ability to challenge views in a constructive manner, knowledge acquired with regard to the Company’s business/activities, understanding of industry and global trends, etc.

The evaluation involves self-evaluation by the Board Member and subsequent assessment by the Board of Directors. A member of the Board will not participate in the discussion of his/her evaluation.

Pursuant to the provisions of the Companies Act, 2013 and Regulation 17 of 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 the Directors individually (including Independent Directors).

Feedback was sought by way of well-defined and structured questionnaires covering various aspects of the Board’s functioning such as adequacy of the composition of the Board and its Committees, Board culture, areas of responsibility, execution and performance of specific duties, obligations and governance, compliance, oversight of Company’s subsidiaries, etc.

A separate exercise was carried out by the Nomination and Remuneration Committee of the Board to evaluate the performance of individual Directors who were evaluated on several parameters such as level of engagement and contribution, independence of judgment safeguarding the interest of the Company and its minority shareholders and knowledge acquired with regard to the Company’s business/activities.

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 Company was also carried out by the Independent Directors, taking into account the views of the Executive Directors and NonExecutive Directors.

The performance evaluation of the Independent Directors was carried out by the entire Board excluding the Director being evaluated. Qualitative comments and suggestions of Directors were taken into consideration by the Chairman of the Board and the Chairman of the Nomination and Remuneration Committee. The Directors have expressed their satisfaction with the evaluation process.

Familiarisation Programme for Independent Directors

The details of programmes for familiarisation of Independent Directors with the Company, their roles, rights, responsibilities in the Company, nature of the industry in which the Company operates, business model of the Company and related matters along with details of number of programmes and number of hours spent by each of the Independent Directors during the Financial Year 2017-18, in terms of the requirements of SEBI [Listing Obligations and Disclosure Requirements] Regulations, 2015 are available on the website of the Company and can be accessed at the web-link: http://www.mahindrafinance.com/ pdf/familiarisation-programme for-IDs.pdf

Policies on Appointment of Directors and Remuneration of Directors, Key Managerial Personnel and Employees

In accordance with the provisions of section 134[3] [e] of the Companies Act, 2013 [“the Act”] read with section 178[2] of the Act and Regulation 17 of the SEBI [Listing Obligations and Disclosure Requirements] Regulations, 2015, your Company has adopted a Policy on Appointment of Directors and Senior Management and succession planning for orderly succession to the Board and the Senior Management, which inter alia, includes the criteria for determining qualifications, positive attributes and independence of Directors.

Your Company has also adopted the Policy on Remuneration of Directors and the Remuneration Policy for Key Managerial Personnel and Employees of the Company in accordance with the provisions of sub-section [4] of section 178, and the same are appended as Annexure V-A and Annexure V-B, respectively and form part of this Report.

The criteria for determining qualifications, positive attributes and independence of a Director and the Remuneration Policies for Directors, Key Managerial Personnel and other employees have been discussed in detail in the Report on Corporate Governance.

AUDITORS

Statutory Auditors

Messrs. B S R & Co. LLP, Chartered Accountants [ICAI Firm Registration No.101248W/W-100022], were appointed as the Statutory Auditors of the Company to hold office for a period of 5 years, commencing from the conclusion of the 27th Annual General Meeting [“AGM”] held on 24th July, 2017 till the conclusion of the 32nd AGM of the Company to be held in the year 2022, subject to ratification of their appointment by the Members at every AGM, as may be applicable.

As required under the provisions of section 139[1] of the Companies Act, 2013, the Company has received a written consent from Messrs. B S R & Co. LLR Chartered Accountants to their appointment and a Certificate, to the effect that their appointment, if made, would be in accordance with the Companies Act, 2013 and the Rules framed thereunder and that they satisfy the criteria provided in section 141 of the Companies Act, 2013.

The Members are requested to ratify the appointment of the Statutory Auditors as aforesaid and fix their remuneration.

The Auditors’ Report is unmodified and does not contain any qualification, reservation, adverse remark or disclaimer.

Secretarial Auditor

The Board of Directors of the Company has appointed Messrs. KSR & Co., Company Secretaries LLP to conduct the Secretarial Audit of the Company pursuant to the provisions of section 204 of the Companies Act, 2013 and the Companies [Appointment and Remuneration of Managerial Personnel] Rules, 2014. In accordance with the provisions of sub-section [1] of section 204, the Secretarial Audit Report for the Financial Year 2017-18 is appended to this Report as Annexure VI.

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

Reporting of Frauds by Auditors

During the year under review, the Statutory Auditors and the 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, details of which need to be mentioned in this Report.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All contracts/arrangements/transactions entered into by the Company during the Financial Year with related parties were in the ordinary course of business and on an arm’s length basis.

During the year under review, your Company had entered into a Material Related Party Transaction, i.e. transaction exceeding ten percent of the annual consolidated turnover as per the last audited financial statements, with Mahindra & Mahindra Limited, the Holding Company. This transaction too was in the Ordinary Course of Business of your Company and was at Arm’s Length Basis, details of which, as required to be provided under section 134[3][h] of the Companies Act, 2013 are disclosed in Form AOC-2 as Annexure VII and forms part of this Annual Report.

The Policy on Related Party Transactions as approved by the Board of Directors of the Company is uploaded on the website of the Company and same can be accessed on the web-link: http://www. mahindrafinance.com/policies.aspx.

MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY

No material changes and commitments have occurred after the closure of the Financial Year 2017-18 till the date of this Report, which would affect the financial position of your Company.

RISK MANAGEMENT POLICY

Your Company has a comprehensive Risk Management Policy in place and has laid down a well-defined risk management framework to identify, assess and monitor risks and strengthen controls to mitigate risks. Your Company has established procedures to periodically place before the Risk Management Committee and the Board of Directors, the risk assessment and minimisation procedures being followed by the Company and steps taken by it to mitigate these risks.

The Risk Management Policy, inter alia, includes identification therein of elements of risk, including those which in the opinion of the Board may threaten the existence of the Company. The 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 Company.

The development and implementation of Risk Management Policy adopted by the Company is discussed in detail in the Management Discussion and Analysis chapter, which forms part of this Annual Report.

WHISTLE BLOWER POLICY/VIGIL MECHANISM

The Company promotes ethical behaviour in all its business activities and has established a vigil mechanism for its Directors, Employees and Stakeholders associated with the Company to report their genuine concerns. The Vigil Mechanism as envisaged in the Companies Act, 2013 and the Rules prescribed thereunder and the Listing Regulations is implemented through the Whistle Blower Policy, to provide for adequate safeguards against victimisation of persons who use such mechanism and make provision for direct access to the Chairperson of the Audit Committee.

As per the Whistle Blower Policy implemented by the Company, the Employees, Directors, customers, dealers, vendors, suppliers, or any Stakeholders associated with the Company are free to report illegal or unethical behaviour, actual or suspected fraud or violation of the Company’s Codes of Conduct or Corporate Governance Policies or any improper activity to the Chairman of the Audit Committee of the Company or Chairman of the Company or Convenor of the Corporate Governance Cell.

The Whistle Blower Policy provides for protected disclosure and protection to the Whistle Blower. Under the Whistle Blower Policy, the confidentiality of those reporting violation(s) is protected and they are not subject to any discriminatory practices. Protected disclosures can also be made by sending an email at the designated email id : mmfsl_whistleblower@ mahindra.com.

The Whistle Blower Policy has been appropriately communicated within the Company and is available on the website of your Company at the web-link: http://www.mahindrafinance.com/pdf/MMFSL VigilMechanism.pdf

No personnel have been denied access to the Audit Committee.

SUBSIDIARIES, JOINT VENTURE AND ASSOCIATES

The Company’s subsidiaries and joint venture continue to contribute to the overall growth in revenues and overall performance of your Company.

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

The Policy for determining material subsidiaries as approved by the Board is hosted on the Company’s website and can be accessed at the web-link: http:// www.mahindrafinance.com/policies.aspx.

SUBSIDIARIES

Mahindra Insurance Brokers Limited

During the year under review, Mahindra Insurance Brokers Limited (MIBL), the subsidiary in the business of Direct and Re-insurance Broking, serviced approximately 2.59 million insurance cases, with a total of 20,58,613 cases for both Life and Non-Life Retail business. The customized Life insurance cover “Mahindra Loan Suraksha” (MLS) increased from 5,82,949 lives covered with a Sum Assured of Rs. 18,027.6 Crores in the Financial Year 2016-17 to 6,85,264 lives covered with a Sum Assured of Rs. 21,359.2 Crores in the Financial Year 2017-18. A substantial portion of MLS continues to be covered in the rural markets.

MIBL achieved a growth of 31% in Gross Premium facilitated for the Corporate and Retail business lines, increasing from Rs. 1,567.9 Crores in the Financial Year 2016-17 to Rs. 2,049.1 Crores in the Financial Year 2017-18. The Total Income increased by 41% from Rs. 174.2 Crores in the Financial Year 201617 to Rs. 245.1 Crores in the Financial Year 2017-18. The Profit Before Tax (PBT) recorded a marginal degrowth of 0.6% at Rs.81.2 Crores as compared to Rs.81.7 Crores in the same period of the previous year. The Profit After Tax (PAT) recorded a degrowth of 1.5% at Rs.52.2 Crores as against Rs.53.0 Crores in the same period of the previous year.

MIBL has been able to reach the benefit of insurance to over 2,00,000 villages across India.

Sale of 1,28,866 Equity Shares representing 5% of the total share capital of MIBL

During the year, your Company sold 1,28,866 Equity Shares aggregating 5% of the share capital of MIBL in favour of Inclusion Resources Private Limited for an overall consideration of Rs. 65 Crores, resulting in a profit of Rs. 65 Crores on sale of this investment. Post the sale, the shareholding of your Company stands reduced from 85% to 80% of MIBL’s share capital.

Mahindra Rural Housing Finance Limited

Mahindra Rural Housing Finance Limited (MRHFL), the Company’s subsidiary in the business of providing loans for purchase, renovation, construction of houses to individuals in the rural and semi-urban areas of the country, registered a total income of Rs. 1,000.0 Crores as compared to Rs. 703.4 Crores for the previous year, registering a growth of 42%. Profit before tax was 77% higher at Rs.224.6 Crores as compared to Rs. 126.9 Crores for the previous year. Profit after tax was 75% higher at Rs.145.5 Crores as compared to Rs. 83.0 Crores for the previous year.

During the year under review, MRHFL disbursed loans aggregating to Rs. 2,789.2 Crores (previous year Rs.2,116.2 Crores) achieving a growth of 32 percent over the previous year.

MRHFL continued its focus on serving customers in rural India. Majority of the loans disbursed were to customers in villages with an average annual household income of less than Rs.1.9 lakhs. During the year under consideration, MRHFL disbursed home loans to around 2,18,000 households (in addition to around 5,60,000 existing households as on 31st March, 2017). MRHFL has been expanding its geographical presence to provide affordable services for rural households.

During the year under review, operations of MRHFL were strengthened in the States of Maharashtra, Gujarat, Rajasthan, Tamil Nadu, Andhra Pradesh, Telangana, Chhattisgarh, Kerala, Karnataka, Madhya Pradesh, Uttar Pradesh, Uttarakhand and Bihar.

Mahindra Asset Management Company Private Limited

Mahindra Asset Management Company Private Limited (MAMCPL), a wholly-owned subsidiary of the Company acts as an Investment Manager for the schemes of Mahindra Mutual Fund. As on 31st March, 2018, MAMCPL was acting as the Investment Manager for six schemes.

The Assets under Management in these six schemes were Rs. 3,352 Crores in March 2018 as compared to Rs. 2,050 Crores in March 2017. Of these assets, Rs. 1,173 Crores were in retail schemes in March 2018 as compared to Rs. 319 Crores in March 2017. MAMCPL has empanelled more than 7,500 distributors and opened 1,26,737 investor accounts in these schemes recording a rise of more than 235%.

During the year under review, the total income of MAMCPL was Rs. 23.4 Crores as compared to Rs. 8.8 Crores for the previous year, registering a growth of 165%. The operations for the year have resulted in a loss of Rs. 38.1 Crores as against a loss of Rs. 20.5 Crores during the previous year.

Mahindra Trustee Company Private Limited

Mahindra Trustee Company Private Limited (MTCPL), your Company’s wholly-owned subsidiary, acts as the Trustee to Mahindra Mutual Fund.

During the year, MTCPL earned trusteeship fees of Rs.23.87 lakhs and other income of Rs.0.73 lakhs as compared to Rs.3.11 lakhs and Rs.0.06 lakhs respectively, for the previous year. The total expenses for the year were Rs.24.25 lakhs as against Rs. 23.52 lakhs in the previous year. MTCPL recorded a profit of Rs.0.35 lakhs for the year under review as against a loss of Rs. 20.4 lakhs in the previous year.

JOINT VENTURE Mahindra Finance USA LLC.

The joint venture company’s disbursement registered a growth of 8.34% to USD 828.38 Million for the year ended 31st March, 2018 as compared to USD 764.61 Million for the previous year.

Income grew by 27.98% to USD 54.61 Million for the year ended 31st March, 2018 as compared to USD 42.67 Million for the previous year. Profit before tax was 27.34% higher at USD 16.44 Million as compared to USD 12.91 Million for the previous year. Profit after tax grew at a healthy rate of 19.02% to USD 9.70 Million as compared to USD 8.15 Million in the previous year.

Names of companies which have become or ceased to be subsidiaries, joint ventures or associate companies during the year

During the year under review, no company has become or ceased to be a subsidiary, joint venture or associate of your Company.

The Company shall provide the copy of the annual accounts of its subsidiary companies and the related information to the Members of the Company on their request. The annual accounts of the subsidiary companies will also be kept open for inspection by any Member at the Registered Office of the Company and also at the Registered Office of the respective subsidiary companies during working hours upto the date of the Annual General Meeting.

The Annual Reports of the subsidiaries will also be available on your Company’s website at the web-link: http://www.mahindrafinance.com/annual-reports.aspx.

Material Subsidiary

Regulation 16[1][c] of the SEBI [Listing Obligations and Disclosure Requirements] Regulations, 2015 defines a “material subsidiary” to mean a subsidiary, whose income or net worth exceeds twenty percent of the consolidated income or net worth respectively, of the listed entity and its subsidiaries in the immediately preceding accounting year.

Under this definition, the Company did not have any material subsidiary, during the year under review.

The Policy for determining material subsidiaries as approved by the Board is uploaded on the Company’s website and can be accessed at the Web-link: http://www.mahindrafinance.com/pdf/ determining material subsidiaries.pdf

CONSOLIDATED FINANCIAL STATEMENTS

The Consolidated Financial Statements of the Company and its four subsidiaries, viz. Mahindra Insurance Brokers Limited, Mahindra Rural Housing Finance Limited, Mahindra Asset Management Company Private Limited and Mahindra Trustee Company Private Limited prepared in accordance with the Companies Act, 2013 and Accounting Standard AS 21 prescribed by The Institute of Chartered Accountants of India, 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 and its joint venture viz. Mahindra Finance USA LLC.

DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND THE COMPANY’S OPERATIONS IN FUTURE

There are no significant and material orders passed by the regulators or courts or tribunals that would impact the going concern status of the Company and its future operations.

DETAILS IN RESPECT OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS

Your Company has in place adequate internal financial controls with reference to financial statements, commensurate with the size, scale and complexity of its operations. Your Company uses Oracle based Systems as a business enabler and also to maintain its Books of Account. The transactional controls built into these systems ensure appropriate segregation of duties, appropriate level of approval mechanisms and maintenance of supporting records. The systems, Standard Operating Procedures and controls are reviewed by Management. These systems and controls are audited by Internal Audit and their findings and recommendations are reviewed by the Audit Committee which ensures the implementation. Review of the internal financial controls environment of the Company was undertaken during the year which covered verification of entity level control, process level control and IT controls, identification, assessment and definition of key business processes and analysis of risk control matrices, etc. The risk and control matrices are reviewed on a quarterly basis and control measures are tested and documented.

Reasonable Financial Controls are operative for all the business activities of the Company and no reportable material weakness or significant deficiencies in the design or operation of internal financial controls was observed.

Nonetheless your Company recognises that any internal control framework, no matter how well designed, has inherent limitations and accordingly, regular audits and review processes ensure that such systems are reinforced on an ongoing basis.

COMPLIANCE WITH THE PROVISIONS OF SECRETARIAL STANDARD - 1 AND SECRETARIAL STANDARD - 2

The Directors have devised proper systems to ensure compliance with the provisions of all applicable Secretarial Standards issued by the Institute of Company Secretaries of India and that such systems are adequate and operating effectively.

PARTICULARS OF REMUNERATION AND RELATED DISCLOSURES

Disclosures with respect to the remuneration of Directors, Key Managerial Personnel and Employees as required under Section 197(12) of the Companies Act, 2013 and Rule 5(1) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, are as under:

Disclosure Details

Ratio of the

Sl.

No.

Disclosure Requirement

Name of Director/ KMP

Designation

remuneration of each Director to median remuneration of Employees

1.

Ratio of the remuneration of each Director to the median remuneration

Mr. Dhananjay Mungale

Chairman

(Independent Director)

11.06X

of the employees of the Company for

Mr. M. G. Bhide

Independent Director

9.14X

the Financial Year 2017-18.

Mr. Piyush Mankad

Independent Director

8.78X

Mr. C. B. Bhave

Independent Director

8.45X

Ms. Rama Bijapurkar

Independent Director

7.85X

Mr. V. S. Parthasarathy

Non-Executive Director

NIL*

Dr. Anish Shah

Non-Executive Director

NIL*

Mr. Ramesh Iyer

Vice-Chairman & Managing Director

196.96X

Mr. V. Ravi

Executive Director & Chief Financial Officer

84.99X

Ms. Arnavaz M.

Company Secretary &

19.76X

Pardiwalla

Compliance Officer

* Mr. V. S. Parthasarathy and Dr. Anish Shah do not receive any remuneration from the Company.

Sl.

No.

Disclosure Details

Disclosure Requirement

Name of Director/KMP

Designation

% increase in Remuneration

2.

Percentage increase in Remuneration of each Director, Chief Financial

Mr. Dhananjay Mungale

Chairman (Independent Director)

1.82

Officer and Company Secretary during

Mr. M. G. Bhide

Independent Director

4.53

the Financial Year 2017-18.

Mr. Piyush Mankad

Independent Director

6.83

Mr. C. B. Bhave

Independent Director

2.81

Ms. Rama Bijapurkar

Independent Director

1.71

Mr. V. S. Parthasarathy

Non-Executive Director

NIL*

Dr. Anish Shah

Non-Executive Director

NIL*

Mr. Ramesh Iyer

Vice-Chairman & Managing Director

-11.53

Mr. V. Ravi

Executive Director & Chief Financial Officer

-13.94

Ms. Arnavaz M.

Company Secretary &

-11.16

Pardiwalla

Compliance Officer

* Mr. V. S. Parthasarathy and Dr. Anish Shah do not receive any remuneration from the Company.

3.

Percentage increase in the median

5.22% considering employees who were in employment for the whole of the

Remuneration of employees in the

Financial Year 2016-17 and Financial Year 2017-18.

Financial Year 2017-18.

4.

Number of Permanent employees on the rolls of the Company as on 31st March, 2018.

18,733

5. Average percentile increase already made in the salaries of employees other than the Managerial Personnel in the last Financial Year i.e. 201718 and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration.

For employees other than Managerial Personnel who were in employment for the whole of the Financial Year 2016-17 and Financial Year 2017-18, the average increase is 5.62%.

Average decrease for Managerial Personnel is 12.20%

Justification: The remuneration of the Vice-Chairman & Managing Director and Executive Director & Chief Financial Officer is decided based on the individual performance, inflation, prevailing industry trends and benchmarks.

The remuneration of eligible Non-Executive Directors consists of commission and sitting fees. While deciding the remuneration, various factors such as Director’s participation in Board and Committee Meetings during the year other responsibilities undertaken, such as Membership or Chairmanship/ Chairpersonship of Committees, etc., were taken into consideration.

The increment given to each individual employee is based on the employees’ potential, experience as also their performance and contribution to the Company’s progress over a period of time and also benchmarked against a comparator basket of relevant companies in India.

6. Affirmation that the remuneration is

The remuneration paid/payable is as per the Policy on Remuneration of

as per the Remuneration Policy of the

Directors and Remuneration Policy for Key Managerial Personnel and

Company

Employees of the Company.

Notes:

1] The remuneration calculated is as per Section 2[78] of the Companies Act, 2013 and includes the perquisite value of Stock Options of the Company exercised during the year

2] The calculations are based on Employees who were on the rolls of the Company for the whole of the Financial Year 2016-17 and Financial Year 2017-18.

Mr. Ramesh Iyer, Vice-Chairman & Managing Director and Mr. V. Ravi, Executive Director & Chief Financial Officer of the Company do not receive any remuneration or commission from its Holding Company. However, Mr. Iyer has been granted stock options under the Employees’ Stock Option Scheme of the Holding Company, Mahindra & Mahindra Limited. Mr. Iyer has not exercised ESOPs of the Holding Company, during the year, which were granted in the earlier year[s].

During the year under review, Mr. Ramesh Iyer and Mr. V. Ravi have received a commission of Rs. 76,56,314 and Rs. 19,15,000, respectively, from Mahindra Insurance Brokers Limited, a subsidiary of the Company. Further in the year under review, 1,14,273 stock options have been granted to Mr. Ramesh Iyer and 28,568 stock options have been granted to Mr. V. Ravi under the Employees’ Stock Option Scheme of Mahindra Rural Housing Finance Limited, the Company’s subsidiary company.

The Company had 14 employees who were in receipt of remuneration of not less than Rs. 1,02,00,000 during the year ended 31st March, 2018 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] and 5 [3] of Companies [Appointment and Remuneration of Managerial Personnel] Rules, 2014 are available at the Registered Office of the Company during working hours, 21 days before the

Annual General Meeting and shall be made available to any shareholder on request. Such details are also available on your Company’s website and can be accessed at the web-link: http://www.mahindrafinance.com/annual-reports.aspx. None of these employees is a relative of any Director of the Company.

None of the employees holds either by himself/herself or along with his/her spouse or dependent children, more than two per cent of the Equity Shares of the Company.

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

Your Company is an equal opportunity employer and is committed to ensuring that the work environment at all its locations is conducive to fair, safe and harmonious relations between employees. It strongly believes in upholding the dignity of all its employees, irrespective of their gender or seniority. Discrimination and harassment of any type are strictly prohibited.

The Company has in place an appropriate Policy in accordance with the provisions of the Sexual Harassment of Women at Workplace [Prevention, Prohibition and Redressal] Act, 2013, to prevent sexual harassment of its employees.

Internal Complaints Committee [ICC] has been set up to redress complaints received regarding sexual harassment.

All employees (permanent, contractual, temporary and trainees) are covered under this Policy. The Policy has been widely communicated internally and is placed on the Company’s intranet portal. The Company ensures that no employee is disadvantaged by way of gender discrimination.

The following is a summary of Sexual Harassment complaint(s) received and disposed off during the year 2017-18, pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and Rules framed thereunder:

(a) Number of complaint(s) of Sexual Harassment received during the year - 1

(b) Number of complaint(s) disposed off during the year - 1

(c) Number of cases pending for more than 90 days - 0

(d) Number of workshops/awareness programme against sexual harassment carried out - 1 workshop was conducted at the Company’s Corporate Office. Awareness on sexual harassment was carried out to sensitize employees of the Company at branches pan-India.

(e) Nature of action taken by the employer or District Officer - Warning letter was issued to the alleged employee.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars in respect of conservation of energy, technology absorption and foreign exchange earnings and outgo, as required under sub-section (3) (m) of section 134 of the Companies Act, 2013 read with Rule (8)(3)of the Companies (Accounts) Rules, 2014 are given as under :

(A) Conservation of Energy

(i) The steps taken or impact on conservation of energy:

The operations of your Company are not energy intensive. However, adequate measures have been initiated to reduce energy consumption.

Select few steps are listed:

a) Replacement of conventional lighting with Light Emitting Diode (LED) lighting :

The Company has installed LED lighting in Regional Offices of the Company during the year under review and the same has been monitored in terms of electrical consumption and expenses.

b) Replacement of old air-conditioning with updated version of machines with R-410A gas, which helps in reducing Ozone depletion.

c) Reduction in water and energy consumption and recycling of waste generation at various locations.

(ii) The steps taken by the Company for utilising alternate sources of energy: Nil.

(iii) The capital investment on energy conservation equipments: Nil.

(B) Technology Absorption

(i) The efforts made towards technology absorption:

Not Applicable.

(ii) The benefits derived like product improvement, cost reduction, product development or import substitution: Not Applicable.

(iii) I n case of imported technology (imported during the last three years reckoned from the beginning of the Financial Year): Not Applicable.

(a) Details of Technology Imported;

(b) Year of Import;

(c) Whether the Technology has been fully absorbed;

(d) if not fully absorbed, areas where absorption has not taken place, and the reasons thereof.

(iv) Your Company has not incurred any expenditure on Research and Development during the year under review.

(C) Foreign Exchange Earnings and Outgo

The information on foreign exchange outgo is furnished in the Notes to the Accounts. There were no foreign exchange earnings during the year.

For and on behalf of the Board

Dhananjay Mungale

Chairman

Place: Mumbai

Date : 25th April, 2018


Mar 31, 2018

To,

The Members of

Mahindna & Mahindra Financial Services Limited

The Directors are pleased to present their Twenty-Eighth Report together with the audited financial statements of your Company for the Financial Year ended 31st March, 2018.

The performance highlights and summarised financial results of the Company are given below:

PERFORMANCE HIGHLIGHTS

Consolidated income for the year increased by 19% to Rs. 8,573.5 Crores as compared to Rs. 7,200.7 Crores in 2016-17;

Consolidated income from operations for the year was Rs. 8,533.1 Crores as compared to Rs. 7,146.2 Crores in 2016-17, a growth of 19%;

Consolidated profit before tax for the year was Rs.1,661.7 Crores as compared to Rs. 837.8 Crores in 2016-17;

Consolidated profit after tax and minority interest for the year was Rs. 1,023.9 Crores as compared to Rs.511.6 Crores in 2016-17.

FINANCIAL RESULTS

Rs. in Crores

CONSOLIDATED

STANDALONE

March 2018

March 2017

March 2018

March 2017

Total Income

8,573.5

7,200.7

7,206.1

6,237.5

Less : Finance Costs

3,426.3

3,186.2

3,000.4

2,857.4

Expenditure

3,481.0

3,123.0

2,853.7

2,714.0

Depreciation/Amortisation

55.2

53.7

44.2

46.0

Total Expenses

6,962.5

6,362.9

5,898.3

5,617.4

Profit Before Exceptional Items and Taxes

1,611.0

837.8

1,307.8

620.1

Exceptional Items (net) - income / (expense)

50.7

-

65.0

-

Profit Before Tax

1,661.7

-

1,372.8

-

Less : Provision For Tax

Current Tax

676.3

463.5

543.1

363.5

Deferred Tax

[66.0]

(155.4)

(62.2)

[143.6]

Profit After Tax for the Year before Minority Interest

1,051.4

529.7

891.9

400.2

Less : Minority Interest

27.5

18.1

-

-

Profit After Tax for the Year after Minority Interest

1,023.9

511.6

891.9

400.2

Add : Amount brought forward from Previous Years

2,850.5

2,522.4

2,489.0

2,240.5

Less: Corporate Dividend and Dividend Distribution Tax

164.3

2.8

161.0

-

Less: Transitional charge in respect of Mark to Market loss on derivative transactions

-

5.1

-

5.1

Amount available for Appropriation

3,710.1

3,026.1

3,219.9

2,635.6

Appropriations

General Reserve

88.4

40.0

89.2

40.0

Statutory Reserve

224.3

109.1

178.4

80.1

Debenture Redemption Reserve

50.5

26.5

50.5

26.5

Surplus carried to Balance Sheet

3,346.9

2,850.5

2,901.8

2,489.0

TRANSFER TO RESERVES

The Company proposes to transfer an amount of Rs. 89.2 Crores to the General Reserve, Rs.178.4 Crores to the Statutory Reserve and Rs.50.5 Crores to the Debenture Redemption Reserve. An amount of Rs.2,901.8 Crores is proposed to be retained in the Statement of Profit and Loss.

DIVIDEND

Your Directors are pleased to recommend a dividend of Rs. 4 per Equity Share of the face value of Rs. 2 each payable to those Members whose names appear in the Register of Members as on the Book Closure date. The dividend including dividend tax for the Financial Year 2017-18 will absorb a sum of Rs. 293.8 Crores [as against 161.0 Crores on account of dividend of Rs. 2.4 per Equity Share and tax thereon, paid for the previous year].

DIVIDEND DISTRIBUTION POLICY

The Board of Directors at its Meeting held on 25th October, 2016, approved and adopted the Dividend Distribution Policy, containing the requirements prescribed in Regulation 43A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Policy is appended as Annexure I and forms part of this Annual Report.

The Dividend Distribution Policy can also be accessed on the Company’s website at the web-link http://www.mahindrafinance.com/policies.aspx.

During the year, an amount of Rs.3,39,065 being the unclaimed/unpaid dividend of the Company for the Financial Year ended 31st March, 2010 was transferred in September, 2017 to the Investor Education and Protection Fund Authority.

OPERATIONS

After three years of subdued rural consumption, there were increasing signs of rural growth recovery with catalysts driving the awaited revival in rural demand. While two successive years of normal monsoon portend well for farm output, the combination of Minimum Support Price (MSP) hikes, direct benefit transfers and farm loan waivers contributed to disposable incomes. The rural sentiments turned positive and the Company did see an improvement in its performance, both in sales as well as overall collections.

Being largely engaged in the semi-urban and rural areas of the country, major part of the Company’s collection is in cash. Your Company however continues to educate its customers to adopt digital and online modes of repayment including Unified Payments Interface (UPI) and Aadhaar Enabled Payment System (AEPS).

While fulfilling its mission of Financial Inclusion, your Company has also built a deep knowledge of customers with micro-data points ranging from income, payment behaviours, socio-economic status and other indirect data. The Company is successfully mining this data to build powerful analytics models extended through digital platforms for customer acquisition, collections, NPA management, customer engagement, forecasting business trends, etc. Your Company has also successfully integrated India Stack capabilities like eKYC, eSign, etc., and digital payment channels in its platforms to serve customers even in low-connectivity remote locations. Among the early adopters of blockchain technology, your Company has in the year under review, launched a vendor financing platform powered by blockchain. This cloud based application is one of the first such blockchain-enabled projects in South Asia, outside of traditional banking.

Your Company remains a significant financier to its customers in rural and semi-urban geographies by providing a wide range of easy and affordable products and services. Your Company consolidated its position as a leading financier in all Aggregator and Self-drive vehicles segment. Your Company expanded vide its channel connect with leading car dealers, and yet again emerged as a major financier for Maruti vehicles in semi-urban and rural India during this fiscal. Your Company has retained its leadership position in financing the Mahindra range of vehicles and tractors in addition to extending its lending to vehicles of other Original Equipment Manufacturers (OEMs) and also continued to be the preferred financier for Hyundai, Renault and Nissan range of vehicles.

Your Company further expanded its geographical presence by reaching out to untapped villages and increased its footprint by opening new branches and making it more accessible to its customers. New financial products and services were introduced during the year, to meet various lifecycle needs of its customers and your Company focused on building additional skill sets and digital capabilities to meet such requirements. Your Company has also enhanced the offerings in-used tractor financing and agri-implements, thereby playing a key role in farm mechanisation across the country.

Your Company strengthened its pan-India presence with a network of 1,284 offices, which is one of the largest amongst Non-Banking Financial Companies. In addition to these offices, your Company has during the year under review, set up over 200 smart branches at dealerships of OEMs and works closely with dealers and customers. Your Company’s nationwide network of branches and locally recruited employees have facilitated in catering to the diverse financial requirements of its customers by identifying and understanding the needs and aspirations of the people.

With its strong presence covering even the most remote areas of the country, your Company is providing flexible financing opportunities to aspiring individuals to realise their dreams and helping them to ‘RISE’. Your Company believes that incessantly serving its customers and channel partners and enhancing customer relationship is the starting point of a great successful journey.

Your Company has earned the trust and confidence of its customers with its consistent, transparent and reliable services and as a result, customer satisfaction across its network continues to remain high. Your Company has cumulatively financed the aspirations of over 5.3 million customers since its inception, most of whom had no prior credit history. Your Company’s philosophy of helping rural customers by providing easy finance at their doorstep has given a big boost in transforming rural lives.

During the year under review, your Company continued to expand its reach in the Micro Small and Medium Enterprises (MSME) segment. MSME Assets Under Management crossed more than Rs. 4,988.04 Crores during the period under review, covering 3,017 customers.

In the year under review, the effect of demonetisation has substantially come down with improved availability of currency notes. Further with the stabilization of the Goods and Services Tax (GST) the temporary downward impact witnessed during the roll-out has been adequately addressed.

The overall disbursement registered a growth of 19% at Rs. 31,659.1 Crores as compared to Rs. 26,706.3 Crores in the previous year. Total Income grew by Rs. 968.6 Crores to Rs.7,206.1 Crores for the year ended 31st March, 2018 as compared to Rs.6,237.5 Crores for the previous year. Profit Before Tax (PBT) grew by Rs.752.6 Crores to Rs.1,372.7 Crores as compared to Rs. 620.1 Crores for the previous year. Profit After Tax (PAT) increased by Rs. 491.7 Crores to Rs.891.9 Crores as compared to Rs.400.2 Crores in the previous year

During the year under review, the Assets Under Management stood at Rs. 55,101 Crores as at 31st March, 2018 as against Rs. 46,776 Crores as at 31st March, 2017, a growth of 18%.

There is no change in the nature of business of the Company during the year under review.

DISTRIBUTION OF MUTUAL FUND PRODUCTS

During the year under review, the activity of distribution of Mutual Fund Products (MFP) was carried out across 161 branches covering 23 States.

As on 31st March, 2018, the amount of Assets Under Management outstanding through the Company’s Distribution Services on MFP aggregate of institutional and retail segment, was Rs. 2,331.40 Crores and the number of clients stood at 59,506.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

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

CORPORATE GOVERNANCE

Your Company practices a culture that is built on core values and ethical governance practices. Your Company is committed to transparency in all its dealings and places high emphasis on business ethics. 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 in Regulations 17 to 27, clauses (b) to (i) of sub-regulation (2) of Regulation 46 and paragraphs C, D and E of Schedule V of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements] Regulations, 2015, forms part of the Annual Report.

SHARE CAPITAL

During the year under review, your Company received the approval of its shareholders to issue upto 2.5 Crores Equity Shares by way of Preferential Allotment to its promoter, Mahindra & Mahindra Limited (“Promoter”) and upto 2.4 Crores Equity Shares by way of Qualified Institutions Placement (“QIP”) and successfully raised a total of Rs. 2,111 Crores through the above issuances made to both its Promoter and a mix of domestic and international Qualified Institutional Buyers.

Preferential Allotment

The Company made a preferential allotment of 2,50,00,000 Equity Shares on 30th November 2017, to its holding company, Mahindra & Mahindra Limited at a price of Rs.422 per Equity Share, including a premium of Rs. 420 per Equity Share, raising a sum of Rs.1,055 Crores.

Qualified Institutions Placement (QIP)

On 7th December, 2017, your Company successfully concluded the QIP issue to Qualified Institutional Buyers aggregating Rs. 1,056 Crores through the issue of 2,40,00,000 Equity Shares of the Face Value of Rs. 2 each at an issue price of Rs. 440 per Equity Share including a premium of Rs. 438 per Equity Share, which is a premium to the price of Rs. 439.63 per share, arrived at as per Regulation 85 of Securities and Exchange Board of India [Issue of Capital and Disclosure Requirements] Regulations, 2009. The QIP launched by your Company received an overwhelming response, as seen by the issue being subscribed multiple times and the strong participation from renowned International and Domestic Institutional Investors.

Consequent to the Preferential Allotment and QIP the issued, subscribed and paid-up Equity Share Capital of the Company stood at Rs.123.55 Crores as at 31st March, 2018, comprising of 61,77,64,960 Equity Shares of the face value of Rs. 2 each, fully paid-up.

With the Promoter maintaining majority shareholding, your Company continues to benefit by leveraging the financial and operational synergies with its Promoter and with the simultaneous QIP issuance, it has been able to diversify its investor base.

Your Company has duly utilised the issue proceeds raised through the Preferential Issue and QIP to augment its long-term resources for meeting business growth and funding requirements, strengthen its capital adequacy, make investments in its Subsidiaries and Joint Venture, for other general corporate purposes and for payment of Issue expenses. This is in line with the issue purpose mentioned in the Explanatory Statement of the Notice of the Extraordinary General Meeting dated 1st November, 2017 and the Placement Document filed with various Regulatory Authorities. Details of these Issues and the end use of funds were furnished to the Audit Committee.

During the year under review, your Company has neither issued shares with differential rights as to dividend, voting or otherwise, nor has issued sweat equity, other than Employee Stock Options under the Employees’ Stock Option Scheme referred to in this Report, during the year under review.

As on 31st March, 2018, none of the Directors of the Company holds instruments convertible into Equity Shares of the Company.

STOCK OPTIONS

During the year under review, on the recommendation of the Nomination and Remuneration Committee of your Company, the Trustees of the Mahindra & Mahindra Financial Services Limited Employees’

Stock Option Trust have granted 62,130 Stock Options to Eligible Employees under the Mahindra & Mahindra Financial Services Limited Employees’ Stock Option Scheme-2010 [“2010 Scheme”]. No new Options have been granted under the Mahindra & Mahindra Financial Services Limited Employees’ Stock Option Scheme-2005 [“2005 Scheme”] [hereinafter collectively referred to as “the Schemes”]. The Company does not have any scheme to fund its employees to purchase the shares of the Company. No employee has been issued stock options during the year, equal to or exceeding 1% of the issued capital of the Company at the time of grant.

The Schemes of the Company are in compliance with the Securities and Exchange Board of India [Share Based Employee Benefits] Regulations, 2014 [“SBEB Regulations”] and there were no material changes made to the said Schemes. Messrs. B S R & Co. LLP, Chartered Accountants, Statutory Auditors of the Company, have certified that the abovementioned Schemes have been implemented in accordance with the SBEB Regulations, and the Resolutions passed by the Members for the 2005 Scheme and the 2010 Scheme. The Certificate would be placed at the Annual General Meeting for inspection by Members.

Voting rights on the Shares issued to employees under the aforesaid Schemes are either exercised by them directly or through their appointed proxy.

The details of the Employees’ Stock Options and the Company’s Employees’ Stock Option Trust as required under the SBEB Regulations read with SEBI Circular CIR/CFD/ POLICY CELL/2/2015 dated 16th June, 2015 have been uploaded on the Company’s website and can be accessed at the web-link: http://www. mahindrafinance.com/annual-reports.aspx.

ECONOMY

Global

At 3.8 percent, global growth last year was 0.5 percentage point faster than in 2016 and the strongest since 2011. Two-thirds of countries accounting for about three-fourths of global output experienced faster growth in 2017 than in the previous year [the highest share of countries experiencing a year-over-year growth pickup since 2010]. The preliminary outcome for global growth in 2017 was 0.2 percentage point stronger than forecast, in the October 2017 World Economic Outlook [WEO], with upside surprises in the second half of 2017 in advanced as well as emerging markets and developing economies.

Resurgent investment spending in advanced economies and an end to the investment decline in some commodity exporting emerging markets and developing economies were important drivers of the uptick in global GDP growth and manufacturing activity. Across advanced economies, the 0.6 percentage point pickup in 2017 growth relative to 2016 is explained almost entirely by investment spending, which remained weak since the 2008-09 global financial crisis and was particularly subdued in 2016. Both stronger gross fixed capital formation and an acceleration in stock building contributed to the pickup in investment, with accommodative monetary policy, stronger balance sheets, and an improved outlook helping release pent-up demand for capital goods.

Global growth is projected to strengthen from 3.8 percent in 2017 to 3.9 percent in 2018 and 2019, driven by a projected pickup in growth in emerging markets and developing economies and resilient growth in advanced economies. The forecast for 2018 and 2019 is stronger than in the October 2017 WEO by 0.2 percentage point for each year, with positive revisions compared with the October 2017 WEO for emerging markets and developing economies and especially for advanced economies. The global effects of US fiscal policy changes account for almost half of the global growth upgrade for 2018-19 compared with October. Beyond 2019, global growth is projected to gradually decline to 3.7 percent by the end of the forecast horizon. The slowdown is entirely because of advanced economies, where growth is projected to moderate in line with their modest potential growth; growth across emerging markets and developing economies is expected to stabilize close to the current level. (Source: IMF)

Domestic

Domestic economic activity shrugged off the loss of speed that had characterised the period Q1:2016-17 to Q1:2017-18 and a turning point appears to have taken hold in Q2-Q3, with lead indicators pointing to further acceleration in Q4. In terms of aggregate demand, the drivers around this inflexion are shifting, with consumption-led growth of the recent past handing over the baton to investment, which had restrained growth since Q3:2016-17. At the same time, the strong impetus from fiscal spending during Q3:2016-17 to Q1:2017-18 appears to be waning and the rapid pace of import growth is sapping net external demand. On the supply side, the pickup in industrial output from Q2:2017-18 and the strengthening of construction activity in the services sector from Q1 are noteworthy. Meanwhile, agriculture and allied activities have turned out to be resilient to temporary weather disruptions in both kharif and rabi sowing seasons and going by recent estimates of foodgrains production, the outlook appears better than before.

Consumer price inflation rose sharply in Q3:2017-18, driven up by a spike in food prices and by the disbursement of enhanced House Rent Allowance (HRA) for central government employees, the latter alone contributing an estimated 35 basis points. It moderated somewhat in Q4 on a delayed seasonal easing of prices of vegetables. Industrial input costs increased through H2:2017-18, tracking movements in international commodity prices. Wage pressures have remained moderate in both the organised and rural sectors. The increase in HRA for central government employees, which became effective from July 2017 and continued to accumulate till December 2017, shaped the path of headline inflation during Q3, with unseasonal hardening of prices of vegetables, accentuating a spike to 4.9 per cent in November. While prices of vegetables did undergo a shallower than usual moderation in December, an unfavourable base effect came into play, pulling up inflation to a peak of 5.2 per cent in December. In Q4, headline inflation moderated with a fall in momentum due to a delayed but steep reversal in prices of vegetables.

A stark feature of India’s recent growth experience has been the protracted downturn in investment, however, a turnaround set in during Q2:2017-18. Gross Fixed Capital Formation (GFCF) strengthened further to touch a six-quarter high in Q3. The share of GFCF in GDP, which was trapped in a downturn from a high of 34.3 per cent in 2011-12 to 30.3 per cent in 2015-16, broke free and increased to 31.4 per cent in 2017-18. As alluded to earlier, this pick-up in the investment rate could be signalling a turning point in the cyclical component of growth oscillations in India and if sustained by a determined policy push, it could produce a level shift in the trajectory of the Indian economy. Capital goods production - a key element of investment demand - turned around in August 2017 and clocked a 19-month high in terms of growth rates in January 2018. During 2017-18 so far (up to December), the construction of highway projects is on the rise and is expected to have improved further in Q4.

Going forward, a key risk to the inflation outlook is the risk of fiscal slippages in a scenario of rising aggregate demand. As noted in the MPC resolution of February 2018, apart from the direct impact on inflation, the fiscal risks could also engender a broader weakening of macro-financial conditions. The revised guidelines for arriving at the MSPs for kharif crops proposed in the Union Budget 2018-19, along with proposed increase in customs duty on a number of items, is likely to pushup inflation over the year. In addition, how various state governments implement and disburse HRA increases would have a considerable bearing on CPI housing inflation and consequently on the headline inflation trajectory, albeit statistically, during 2018-19; therefore, the latter should be looked through for monetary policy purposes, other than for their second-round effects. Although the central government’s HRA effects on CPI inflation would gradually wane from July 2018, this moderating impact could be more than offset if several state governments simultaneously implement HRA increases in H2:2018-19. (Source: RBI)

Finance

During the current year, the Reserve Bank of India (RBI) held six Bi-monthly Monetary Policy Committee meetings. The Policy Repo rates under the Liquidity Adjustment Facility (LAF) was at 6.25% at the beginning of the year. During the year, the RBI reduced the Policy Repo rates by 0.25% once in its third Bi-monthly Monetary Policy Committee meeting to 6.00% and since then maintained at such levels.

Yields in the government securities (G-Sec) has shown continuous increase through the year since the reduction of policy rates. Yields on the 10 year benchmark paper has increased by around 150 bps from the lows. A sharp reduction in G-Sec yields were seen in the month of March when the government announced its intent to reduce its borrowing in the first half. However the reduced rates were short lived and within a month the yields were higher than preannouncement. An important element of the yield rising has been the continuous rise in the crude prices (nearing -80/barrel). The depreciation of rupee is not helping either which shall lead to inflationary pressure which together is resulting in rising yields.

Private Placement Issues of Non-Convertible Debentures

During the year under review, your Company issued secured redeemable non-convertible debentures (“NCDs”) aggregating to Rs. 4,497.80 Crores on a private placement basis, in various tranches.

As specified in the respective offer documents, the funds raised from NCDs were utilised for the purpose of financing, repayment of dues of other financial institutions/Banks or for long term working capital.

Public Issuance of Non-Convertible Debentures

Your Company continues to broaden the liability mix by bringing in new instruments as well as diversifying the investor base and profile. During the year under review, your Company successfully raised Rs. 1,150.5 Crores through its second public issuance of 1,15,05,313 Unsecured Subordinated Redeemable Non-Convertible Debentures (“NCDs”) of face value of Rs. 1,000 each. With this issuance, approximately 5% of your Company’s borrowing is funded through this instrument. The NCDs were allotted on 24th July, 2017 and listed on BSE Limited on 26th July, 2017.

The net proceeds received from the Public Issue were used for the purpose of onward lending, financing, refinancing the existing indebtedness of the Company, long term working capital requirements, Issue expenses and for general corporate purposes. Details of the Issue and the end use were furnished to the Audit Committee.

The Company has been regular in making payments of principal and interest on the NCDs. There are no NCDs which have not been claimed by investors or not paid by the Company after the date on which the NCDs became due for redemption.

Rupee Denominated Medium Term Note (MTN)

As a risk management measure diversification of its resources is one of the focus areas of the Company. To this end, your Company has received approval from the Reserve Bank of India for issuance of Masala Bonds. Your Company has also updated its Offering Circular of Rupee Denominated Medium Term Note (MTN) programme, listed on the Singapore Exchange Securities Trading Limited, and subject to market conditions, plans to issue bonds under the MTN programme during the current year.

INVESTOR RELATIONS

Your Company continuously endeavors to improve its engagement with Domestic and International investors/analysts through multiple mechanisms, including structured conference-calls, individual meetings, Telepresence meetings, participating in investor conferences and undertaking quarterly and annual earnings calls. Your Company attended multiple investor meets organised by reputed Global and Domestic Broking Houses during the year, both in India and abroad, to communicate details of its performance, important regulatory and market developments and exchange of information. These interactions with institutional shareholders, fund managers and analysts are based on generally available information that is accessible to the public on a non-discriminatory basis. Your Company uploads the transcript of the quarterly earnings call on its website which can be accessed by existing and potential investors and lenders.

Your Company believes in transparent communication and building a relationship of mutual understanding and trust. Your Company further ensures that critical information about the Company is available to all the investors by hosting all such information on the Company’s website.

CAPITAL ADEQUACY

Consequent upon the allotment of Equity Shares issued on a Preferential Allotment basis to the Promoter and through a Qualified Institutions Placement to Qualified Institutional Buyers, the paid-up share capital of the Company has increased to Rs.123.6 Crores as on 31st March, 2018 from Rs. 113.8 Crores as on 31st March, 2017. The securities premium account has also increased to Rs. 4,113.2 Crores from Rs.2,025.6 Crores.

As a result of the increased net worth, your Company was able to enhance the Capital to Risk Assets Ratio (CRAR) to 21.9 % as on 31st March, 2018, well above the minimum requirement of 15% CRAR prescribed by the Reserve Bank of India. Out of the above, Tier I capital adequacy ratio stood at 16.0% and Tier II capital adequacy ratio stood at 5.9%, respectively.

RBI GUIDELINES

The Company has complied with all the applicable regulations of the Reserve Bank of India (RBI).

As a prudent practice, your Company makes accelerated provisioning for Non-Performing Assets (NPAs) than that required by RBI for NBFCs. Your Company continues to make a general provision at 0.40% on the standard assets outstanding as mandated by the RBI.

DISCLOSURE PERTAINING TO GOLD LOAN AUCTION(S)

During the fiscal 2016-17, your Company conducted the auction of its Gold Stock and sold the entire stock. With this auction the Company has closed its entire gold loan business.

CREDIT RATING

The credit rating details of the Company as on 31st March, 2018 were as follows:

Rating Agency

Type of Instrument

Rating*

Remarks

India Ratings & Research Private Limited

Commercial Paper Programme

‘IND A1 ’

The ‘A1 ’ rating indicates the Highest Level of Rating. Instruments with this rating are considered to have very strong degree of safety regarding timely payment of financial obligations. Such instruments carry lowest credit risk.

Long-term Debt Instruments and Subordinated Debt Programme

‘IND AAA/Stable’

CARE Ratings Limited (Formerly known as Credit Analysis & Research Limited)

Long-term Debt Instruments and Subordinated Debt Programme

‘CARE AAA/Stable’

The ‘AAA’ ratings denote the highest degree of safety regarding timely servicing of financial obligations. Such instruments carry lowest credit risk.

Brickwork Ratings India Private Limited

Long-term Subordinated Debt Programme

‘BWR AAA/Stable’

CRISIL Limited

Fixed Deposit Programme

‘CRISIL FAAA/Stable’

Long-term Debt Instruments, Subordinated Debt Programme and Bank Facilities

‘CRISIL AA /Stable’

The ‘AA ’ rating indicates a high degree of safety with regard to timely payment of financial obligations. Such instruments carry very low credit risk.

Short-term Debt and Bank Loans

‘CRISIL A1 ’

The ‘A1 ’ rating indicates the Highest Level of Rating. Instruments with this rating are considered to have very strong degree of safety regarding timely payment of financial obligations. Such instruments carry lowest credit risk.

* The ratings mentioned above were reaffirmed by the Rating Agencies during the Financial Year 2017-18. With the above rating affirmations, your Company continues to enjoy the highest level of rating from all major rating agencies at the same time.

ACHIEVEMENTS

Your Company won several awards and accolades during the year under review. Select few awards/ recognition are enumerated hereunder:

Corporate Governance

India’s Most Trusted Companies Awards 2017” as per the Research Report 2017 by Media Research Group, MRG.

Listed amongst the top 10 companies with a high Corporate Governance score in a study jointly conducted by International Finance Corporation (IFC), BSE Limited (BSE) and Institutional Investor Advisory Services (IiAS).

Business & Marketing:

- Ranked 108th in the “Dun & Bradstreet India’s Top 500 Companies 2017” based on Net Profit.

- Adjudged as one of the “Best BFSI Brands 2018” by the Economic Times.

- Award for the ‘Most Effective use of Direct Marketing to Rural Consumers’ at the Rural Marketing Forum & Awards 2018 for MF SUTRADHAAR initiative.

Ranked 13th based on Total Income in “Dun & Bradstreet India’s Leading BFSI Companies 2018” among NBFCs, Financial Institutions and Financial Services Companies.

Won the PRCI (Public Relations Council of India) Collateral Awards 2018 in the following categories:

a. Crystal Award for Corporate Advertising Campaign (SME Ad campaign)

b. Crystal Award for Radio/Jingle (SME Radio Campaign)

c. Gold Award for Rural or Development -Communication (MF SUTRADHAAR Program)

d. Gold Award for Financial Communication (Suvidha Loans Communication Campaign)

e. Silver Award for Radio Communication (SME Radio Campaign)

f. Appreciation Award for Diary 2018

g. Appreciation Award for In-house Digital Newsletter (In-box Select)

h. Appreciation Award for Annual Report

Human Resources

Listed in Aon Best Employer List 2017, as Aon Best Employer

Certified Top 50 India’s Best Companies to Work for - 2017 by Great Place to work.

Adjudged Runner-up in the BusinessWorld HR Excellence Award 2017 by BusinessWorld.

“Best Learning & Development Strategy Award” at World HRD Congress 2017.

Listed in the Avtar and Working Mothers Best Companies to work for.

Appeared in Top 100 Record Holders for Excellence in Learning Sessions.

Attained Level 5 certification for People Capability Maturity Model (PCMM) Level 5.

CSR & Sustainability

Honoured with IDF CSR Award by Indian Development Foundation (IDF) for excellent participation in Resource Mobilization for Humanitarian Projects.

Bestowed with the Equal Opportunity Employer Award by Sarthak Educational Trust for ensuring equal employment opportunities and sustainable employment prospects to person with disability.

Listed in Dow Jones Sustainability Index (DJSI) Emerging Markets category for the 5th consecutive year.

Included in the “Sustainability Yearbook 2018” released by RobecoSAM, being the only Indian Financial Company in Diversified Financial Services and Capital Markets sector to be selected.

Information & Technology

Pride of India Award” for Best Enterprise Learning Platform

FIXED DEPOSITS AND LOANS/ ADVANCES

Your Company offers a bouquet of Fixed Deposit schemes to suit the investment needs of various classes of investors. These Deposits carry attractive interest rates with superior service enabled by robust processes and technology. In order to tap rural and semi-urban savings and reach out to the farthest customers, your Company continues to expand its network and make its presence felt in the most remote areas of the country.

During the year, CRISIL has reaffirmed a rating of ‘CRISIL FAAA/Stable’ for your Company’s Fixed Deposits. This rating represents the highest degree of safety regarding timely servicing of financial obligations and carries the lowest credit risk. Your Company’s deposits continue to be a preferred investment amongst the investors.

As on 31st March, 2018, your Company has mobilised funds from Fixed Deposits to the tune of Rs. 3,137.37 Crores, with an investor base of over 1,30,413 investors.

Your Company continues to serve the investors by introducing several customer centric measures on an ongoing basis to further strengthen its processes in sync with the requirements of the Fixed Deposit holders. The Company communicates various intimations via SMS, e-mails, post, etc., to its investors as well as sends reminder emails to clients whose TDS is likely to be deducted before any payout/ accrual. Your Company also provides online renewal facility, online generation of TDS certificates from customer/broker portal and Seamless Investment process for employees.

During the year under review, your Company has rolled out several initiatives aimed at offering a superior customer experience. Some key ones are:

Increased the number of offices from 198 in the previous fiscal to 304 offices in the current fiscal for collection of Fixed Deposits.

Customer self-profile update on the Fixed Deposit-Customer Portal available on the Company’s website.

Default auto renewal of Fixed Deposits option to facilitate timely renewal of deposits in case the physical request for renewal of Deposits is not received four weeks prior to the maturity date.

Introduced online Swift Loan[s] against Deposits.

Convenience of investment made available through mobile phones.

As at 31st March, 2018, 4,662 deposits amounting to Rs. 8.61 Crores had matured for payment and remained unclaimed. The unclaimed deposits have since reduced to 3,761 deposits amounting to Rs. 6.10 Crores. There has been no default in repayment of deposits or payment of interest during the year.

Your Company being a Non-Banking Financial Company, the disclosures required as per Rule 8 [5] [v] and [vi] of the Companies [Accounts] Rules, 2014 read with sections 73 and 74 of the Companies Act, 2013, are not applicable to it.

The information pursuant to Clause 35[1] of Master Direction DNBR.PD.002/03.10.119/2016-17 dated 25th August, 2016 issued by Reserve Bank of India on Non-Banking Financial Companies Acceptance of Public Deposits [Reserve Bank] Directions, 2016, regarding unpaid/unclaimed public deposits as on 31st March, 2018, is furnished below:

i. total number of accounts of public deposits of the Company which have not been claimed by the depositors or not paid by the Company after the date on which the deposit became due for repayment: 4,662.

ii. the total amounts due under such accounts remaining unclaimed or unpaid beyond the dates referred to in clause [i] as aforesaid: Rs. 8,60,67,196.

Depositors were intimated regarding the maturity of deposits with a request to either renew or claim their deposits. Your Company continues to send intimation letters via registered post every 3 months to all those Fixed Deposit holders whose deposits have matured as well as to those whose deposits remain unclaimed. Where the Deposit remains unclaimed, follow-up action is also initiated through the concerned agent or branch.

Pursuant to section 125[2] [i] of the Companies Act, 2013 read with the Investor Education and Protection Fund Authority [Accounting, Audit, Transfer and Refund] Rules, 2016 [“the IEPF Rules”] as amended from time to time, matured Deposits remaining unclaimed for a period of seven years from the date they became due for payment are required to be transferred to the Investor Education and Protection Fund [IEPF] Authority established by the Central Government. The concerned depositor can claim the Deposit from the IEPF Authority by following the procedure laid down in the IEPF Rules.

During the year, an amount of Rs.0.02 Crores has been transferred to the IEPF Authority.

During the year under review, the Company has not given any loans and advances in the nature of loans to its subsidiaries or associate or loans and advances in the nature of loans to firms/companies in which Directors are interested.

Accordingly, the disclosure of particulars of loans/ advances, etc., as required to be furnished in the Annual Accounts of the Company pursuant to Regulation 34 read with paragraph A of Schedule V of the SEBI [Listing Obligations and Disclosure Requirements] Regulations, 2015 is not applicable to the Company.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS IN SECURITIES

Pursuant to section 186[11] of the Companies Act, 2013 [“the Act”], the provisions of section 186 [4] of the Act requiring disclosure in the Financial Statements of the full particulars of the loans made and guarantees given or securities provided by a NonBanking Financial Company in the ordinary course of its business 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 exempted from disclosure in the Annual Report.

Further, pursuant to the provisions of section 186 (4) of the Act, the details of investments made by the Company are given in the Notes to the Financial Statements.

SUSTAINABILITY INITIATIVES

Sustainability has always been a key success factor for the ambit of the Company’s businesses. Through its unique business model the Company is making a difference in the lives of many by addressing the essential requirements of people in rural and semi-urban parts of India. Your Company’s businesses focus on key necessities of people and enable them to meet their aspirations through a wide-range of financial products and services offered by it. By providing the right set of opportunities in the remote areas and handholding its customers to advance in their lives, your Company continues to make positive contribution to multiple stakeholders. Your Company lays strong emphasis on customer centricity with its customer base spread across more than 3.5 Lakh villages in India with majority of them belonging to the earn and pay segment.

Your Company commenced its journey towards reporting sustainability performance since 2008-09 through Mahindra Group’s Sustainability Report and in the year 2012-13 your Company released its first standalone Sustainability Report. In the reporting year the Company released its fifth Sustainability Report for the Financial Year 2016-17 with the theme ‘Towards Value Creation’ based on the Global Reporting Initiative’s (GRI) G4 Guidelines which highlights its progress and efforts on creating long term benefits and opportunities on social, environmental and economic dimensions for all its stakeholders. This Report is hosted on your Company’s website at the web-link: www.mahindrafinance.com/sustainability.aspx.

Your Company continued to focus on sustainability awareness for different stakeholders by building on the initiatives of the previous years as also initiating new ones. In the year under review, your Company formulated its Sustainability Policy and developed a new Sustainability Roadmap aligned to the Mahindra Group’s Sustainability Framework to ensure mutual initiatives for sustainability across the Group. Interventions on energy efficiency, technology deployment and waste management have been taken throughout the reporting year at different locations. The Company continued its focus on encouraging employees and field staff in adopting Road Safety measures.

Your Company has been listed on the Dow Jones Sustainability Index (DJSI) Emerging Market Trends for the fifth consecutive year. Your Company is the only Company from amongst the Diversified Financial Services Companies in India to have made it to this list. To be incorporated in DJSI, companies are assessed and selected based on their long term Environmental, Social and Governance (ESG) management plans. Your Company got selected in ‘The Sustainability Yearbook’ 2018 being the only Financial Services Sector Company to qualify amongst 9 companies from India. This signifies your Company being amongst the top Sustainability performers in Diversified Financial Services Sector across the world based on Corporate Sustainability Assessment done by RobecoSAM.

In addition to this, your Company continues to report on Carbon Disclosure Project (CDP) since the Financial Year 2011-12. CDP seeks information on management of carbon emissions covering world’s largest companies and how they are geared up to mitigate challenges pertaining to climate change and global warming in future. During the reporting year, your Company retained CDP Performance Band - B which affirms that the Company is taking coordinated action on climate change issues. Your Company made proactive efforts to reduce CO2 emissions (carbon footprint) through Project ‘Mahindra Hariyali’, by planting over 1.2 Lakh saplings throughout the country.

Your Company is gearing up to be future ready by making sustainability and climate change an integral part of the risk framework and taking measures to mitigate and manage them. Weather reports are assessed on a regular basis and aligned with business operations to protect the customers and minimise the risk impact. Your Company is well equipped to enable its customers and communities progress through its inclusive and sustainable business model.

BUSINESS RESPONSIBILITY REPORT

The ‘Business Responsibility Report’ (BRR) of your Company for the year 2017-18 forms part of this Annual Report as required under Regulation 34(2)(f) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 and is appended as Annexure II. Your Company is building an inclusive organization by engaging with stakeholders and creating value in the ecosystem it operates in. Your Company’s businesses focus on the key necessities of people and enable them to earn their livelihood through its varied portfolio of financial products and services. Through its wide network of branches with locally-recruited employees, strong and lasting relationships with its stakeholders, large customer base, vast experience and market knowledge, your Company is providing financial resources to underserviced regions of the country and building livelihood for such sections of the population, who are aspiring for a better living in the villages.

The BRR can also be accessed on the Company’s website at the web-link: www.mahindrafinance. com/sustainability.aspx.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

With an objective to empower rural India and transform the rural landscape, your Company during the year, continued to undertake several initiatives in the key thrust areas of Healthcare, Education (including Livelihood) and Environment. It is only through these sustained and consistent efforts that your Company can build and consolidate its CSR initiatives which contribute to nation building.

In the year under review, your Company organised a nationwide blood donation drive, conducted health check-up camps, Swachh Bharat activities, visits to Municipal schools, orphanages, differently-abled homes and old-age homes to re-affirm its pledge to the society.

Your Company also contributed to the environment through planting of over one Lakh trees thus helping restore the diminishing green cover in the country. In the area of public health, your Company sponsored Lifeline Express, a hospital on wheels program, through which medical care and treatment was provided to communities who do not have access to any medical facilities. The Lifeline Express executed in association with Impact India Foundation, catered to the medical needs of 8,010 underprivileged people in Balharshah, in the State of Maharashtra.

In an effort to unleash the potential of the rural population, during the year your Company implemented some of the notable ongoing projects such as providing scholarships to 2,500 undergraduate and 500 graduate students, conducting vocational training for 513 rural youths and Drivers’ training for 220 women, setting-up a vocational skill building center with an aim to train 250 People with Disability and a donation of 14 ambulances that have made access to primary healthcare centers easy for 12,000 tribal and rural patients across the nation. Your Company has expanded the Medical Equipment Donation project to contribute equipment to 30 family planning centers and supported the maintenance of two more Thalassemia Day Care Centers apart from the four existing ones in Maharashtra and one in Jharkhand. Additionally, in the area of healthcare, your Company contributed for the launch of a Maternal & Child Health Care project which provides nutritional supplementation to anemic pregnant and lactating women, adolescents and malnourished children in the areas of Singbhum (Jharkhand), Bhubaneswar (Odisha), Palghar and Thane (Maharashtra).

In the year under review, your Company continued to provide assistance to over 9,400 Nanhi Kalis which supports the education of underprivileged girls. Your Company also continued its commitment to projects such as Mahindra Pride Schools, which helped in providing livelihood training to 2,612 youths from socially and economically disadvantaged communities.

During the year under review, your Company has spent Rs. 27.16 Crores on CSR projects/programs. 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. 27.07 Crores. Your Company is in compliance with the statutory requirements in this regard.

CSR COMMITTEE

The CSR Committee presently comprises of Mr. Piyush Mankad (Chairman), Mr. Ramesh Iyer, Mr. V. Ravi and Dr. Anish Shah. The Committee, inter alia, monitors the CSR activities.

CSR POLICY

The CSR Policy of the Company is hosted on the Company’s website at the web-link: http://www. mahindrafinance.com/csr.aspx and a brief outline of the CSR Policy and the CSR initiatives undertaken by the Company during the year as per Annexure prescribed in the Companies (Corporate Social Responsibility Policy) Rules, 2014 have been appended as Annexure III to this Report.

EXTRACT OF ANNUAL RETURN

Pursuant to sub-section 3(a) of section 134 and subsection (3) of section 92 of the Companies Act, 2013, read with Rule 12 of the Companies (Management and Administration) Rules, 2014, an extract of the Annual Return as at 31st March, 2018 forms part of this Report and is appended as Annexure IV.

BOARD MEETINGS, ANNUAL GENERAL MEETING AND EXTRAORDINARY GENERAL MEETING

The calendar of the Board/Committee Meetings and the Annual General Meeting is circulated to the Directors in advance to enable them to plan their schedule for effective participation at the respective meetings. Additional Board Meetings are convened by giving appropriate notice to address business exigencies. At times certain decisions are taken by the Board/Committee through circular resolutions.

All the decisions and urgent matters approved by way of circular resolutions are placed and noted at the subsequent Board/Committee Meeting.

The Board of Directors met seven times during the year under review, on 25th April, 2017, 24th July, 2017, 6th October, 2017, 25th October, 2017, 1st November, 2017, 24th January, 2018 and 16th March, 2018. The requisite quorum was present for all the Meetings. The maximum time gap between any two Meetings was not more than one hundred and twenty days. These Meetings were well attended. The 27th Annual General Meeting [AGM] of the Company was held on 24th July, 2017.

During the year under review, an Extraordinary General Meeting [EGM] of the Members was held on 29th November, 2017 to approve the issuance of Equity Shares on Qualified Institutions Placement to Qualified Institutional Buyers, approve Related Party transaction for Preferential Issue of Shares to Mahindra & Mahindra Limited [M&M], the holding company and accord consent for issue of Equity Shares to M&M on a Preferential Allotment basis.

Detailed information on the Meetings of the Board, its Committees, the AGM and EGM is included in the Report on Corporate Governance, which forms part of this Annual Report.

MEETINGS OF INDEPENDENT DIRECTORS

The Independent Directors met twice during the year under review, on 23rd January, 2018 and 15th March, 2018. The Meetings were conducted in an informal manner without the presence of the Wholetime Directors, the Non-Executive Non-Independent Directors, or any other Management Personnel.

COMMITTEES OF THE BOARD OF DIRECTORS

The Company has various Committees which have been constituted as a part of good corporate governance practices and the same are in compliance with the requirements of the relevant provisions of applicable laws and statutes.

Your Company has an adequately qualified and experienced Audit Committee with Mr. C. B. Bhave as the Chairman and Mr. Dhananjay Mungale, Mr. M. G. Bhide, Ms. Rama Bijapurkar, Mr. Piyush Mankad, Mr. V S. Parthasarathy and Dr. Anish Shah as Members.

The recommendations of the Audit Committee were duly approved and accepted by the Board during the year under review.

The other Committees of the Board are:

i] Nomination and Remuneration Committee

ii] Stakeholders Relationship Committee

iii] Corporate Social Responsibility Committee

iv] Risk Management Committee

v] Asset Liability Committee

vi] Committee for Strategic Investments

vii] IT Strategy Committee

The details with respect to the composition, powers, roles, terms of reference, Meetings held and attendance of the Directors at such Meetings of the relevant Committees are given in detail in the Report on Corporate Governance of the Company which forms part of this Annual Report.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

Directors

Dr. Anish Shah, Non-Executive Non-Independent Director, retires by rotation at the forthcoming Annual General Meeting and, being eligible, offers himself for reappointment. The detailed profile of Dr. Anish Shah has been included in the Notice convening the ensuing AGM.

All the Directors of the Company have confirmed that they satisfy the fit and proper criteria as prescribed under paragraph 69[1][iv] of Chapter XI of RBI Master Direction No. DNBR. PD. 008/03.10.119/2016-17 dated 1st September, 2016 and that they are not disqualified from being appointed as Directors in terms of section 164[2] of the Companies Act, 2013.

None of the Independent Directors are due for re-appointment.

Key Managerial Personnel

Mr. Ramesh Iyer, Vice-Chairman & Managing Director, Mr. V Ravi, Executive Director & Chief Financial Officer and Ms. Arnavaz M. Pardiwalla, Company Secretary of the Company have been designated as the Key Managerial Personnel of the Company [KMP] pursuant to the provisions of sections 2[51] and 203 of the Companies Act, 2013 read with the Companies [Appointment and Remuneration of Managerial Personnel] Rules, 2014.

There has been no change in the KMP during the year under review.

Declaration by Independent Directors The Company has received declarations from all the Independent Directors of the Company confirming that they fulfill the criteria of independence as prescribed under sub-section [6] of section 149 of the Companies Act, 2013 and the Securities and Exchange Board of India [Listing Obligations and Disclosure Requirements] Regulations, 2015.

Directors’ Responsibility Statement

Pursuant to the provisions of section 134[5] of the Companies Act, 2013, [“the Act”] your Directors, based on the representations received from the Operating Management and after due enquiry, confirm that:

i. i n the preparation of the annual accounts for financial year ended 31st March, 2018, the applicable accounting standards have been followed and there are no material departures in adoption of these standards.

ii. they have in consultation with the Statutory Auditors selected such 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 31st March, 2018 and of the profit of the Company for the year ended on that date.

iii. they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

iv. they have prepared the annual accounts for financial year ended 31st March, 2018 on a going concern basis.

v. they have laid down adequate internal financial controls to be followed by the Company and that such internal financial controls were operating effectively during the financial year ended 31st March, 2018.

vi. they have devised proper systems to ensure compliance with provisions of all applicable laws and that such systems were adequate and operating effectively during the financial year ended 31st March, 2018.

Performance Evaluation of the Board

The Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“the Listing Regulations”) stipulate the evaluation of the performance of the Board, its Committees, Individual Directors and the Chairperson.

The Company has formulated a Policy for performance evaluation of the Independent Directors, the Board, its Committees and other individual Directors which includes criteria for performance evaluation of the Non-Executive Directors and Executive Directors.

The evaluation framework for assessing the performance of Directors comprises of various key areas such as attendance at Board and Committee Meetings, quality of contribution to Board discussions and decisions, strategic insights or inputs regarding future growth of the Company and its performance, ability to challenge views in a constructive manner, knowledge acquired with regard to the Company’s business/activities, understanding of industry and global trends, etc.

The evaluation involves self-evaluation by the Board Member and subsequent assessment by the Board of Directors. A member of the Board will not participate in the discussion of his/her evaluation.

Pursuant to the provisions of the Companies Act, 2013 and Regulation 17 of 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 the Directors individually (including Independent Directors).

Feedback was sought by way of well-defined and structured questionnaires covering various aspects of the Board’s functioning such as adequacy of the composition of the Board and its Committees, Board culture, areas of responsibility, execution and performance of specific duties, obligations and governance, compliance, oversight of Company’s subsidiaries, etc.

A separate exercise was carried out by the Nomination and Remuneration Committee of the Board to evaluate the performance of individual Directors who were evaluated on several parameters such as level of engagement and contribution, independence of judgment safeguarding the interest of the Company and its minority shareholders and knowledge acquired with regard to the Company’s business/activities.

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 Company was also carried out by the Independent Directors, taking into account the views of the Executive Directors and NonExecutive Directors.

The performance evaluation of the Independent Directors was carried out by the entire Board excluding the Director being evaluated. Qualitative comments and suggestions of Directors were taken into consideration by the Chairman of the Board and the Chairman of the Nomination and Remuneration Committee. The Directors have expressed their satisfaction with the evaluation process.

Familiarisation Programme for Independent Directors

The details of programmes for familiarisation of Independent Directors with the Company, their roles, rights, responsibilities in the Company, nature of the industry in which the Company operates, business model of the Company and related matters along with details of number of programmes and number of hours spent by each of the Independent Directors during the Financial Year 2017-18, in terms of the requirements of SEBI [Listing Obligations and Disclosure Requirements] Regulations, 2015 are available on the website of the Company and can be accessed at the web-link: http://www.mahindrafinance.com/ pdf/familiarisation-programme for-IDs.pdf

Policies on Appointment of Directors and Remuneration of Directors, Key Managerial Personnel and Employees

In accordance with the provisions of section 134[3] [e] of the Companies Act, 2013 [“the Act”] read with section 178[2] of the Act and Regulation 17 of the SEBI [Listing Obligations and Disclosure Requirements] Regulations, 2015, your Company has adopted a Policy on Appointment of Directors and Senior Management and succession planning for orderly succession to the Board and the Senior Management, which inter alia, includes the criteria for determining qualifications, positive attributes and independence of Directors.

Your Company has also adopted the Policy on Remuneration of Directors and the Remuneration Policy for Key Managerial Personnel and Employees of the Company in accordance with the provisions of sub-section [4] of section 178, and the same are appended as Annexure V-A and Annexure V-B, respectively and form part of this Report.

The criteria for determining qualifications, positive attributes and independence of a Director and the Remuneration Policies for Directors, Key Managerial Personnel and other employees have been discussed in detail in the Report on Corporate Governance.

AUDITORS

Statutory Auditors

Messrs. B S R & Co. LLP, Chartered Accountants [ICAI Firm Registration No.101248W/W-100022], were appointed as the Statutory Auditors of the Company to hold office for a period of 5 years, commencing from the conclusion of the 27th Annual General Meeting [“AGM”] held on 24th July, 2017 till the conclusion of the 32nd AGM of the Company to be held in the year 2022, subject to ratification of their appointment by the Members at every AGM, as may be applicable.

As required under the provisions of section 139[1] of the Companies Act, 2013, the Company has received a written consent from Messrs. B S R & Co. LLR Chartered Accountants to their appointment and a Certificate, to the effect that their appointment, if made, would be in accordance with the Companies Act, 2013 and the Rules framed thereunder and that they satisfy the criteria provided in section 141 of the Companies Act, 2013.

The Members are requested to ratify the appointment of the Statutory Auditors as aforesaid and fix their remuneration.

The Auditors’ Report is unmodified and does not contain any qualification, reservation, adverse remark or disclaimer.

Secretarial Auditor

The Board of Directors of the Company has appointed Messrs. KSR & Co., Company Secretaries LLP to conduct the Secretarial Audit of the Company pursuant to the provisions of section 204 of the Companies Act, 2013 and the Companies [Appointment and Remuneration of Managerial Personnel] Rules, 2014. In accordance with the provisions of sub-section [1] of section 204, the Secretarial Audit Report for the Financial Year 2017-18 is appended to this Report as Annexure VI.

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

Reporting of Frauds by Auditors

During the year under review, the Statutory Auditors and the 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, details of which need to be mentioned in this Report.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All contracts/arrangements/transactions entered into by the Company during the Financial Year with related parties were in the ordinary course of business and on an arm’s length basis.

During the year under review, your Company had entered into a Material Related Party Transaction, i.e. transaction exceeding ten percent of the annual consolidated turnover as per the last audited financial statements, with Mahindra & Mahindra Limited, the Holding Company. This transaction too was in the Ordinary Course of Business of your Company and was at Arm’s Length Basis, details of which, as required to be provided under section 134[3][h] of the Companies Act, 2013 are disclosed in Form AOC-2 as Annexure VII and forms part of this Annual Report.

The Policy on Related Party Transactions as approved by the Board of Directors of the Company is uploaded on the website of the Company and same can be accessed on the web-link: http://www. mahindrafinance.com/policies.aspx.

MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY

No material changes and commitments have occurred after the closure of the Financial Year 2017-18 till the date of this Report, which would affect the financial position of your Company.

RISK MANAGEMENT POLICY

Your Company has a comprehensive Risk Management Policy in place and has laid down a well-defined risk management framework to identify, assess and monitor risks and strengthen controls to mitigate risks. Your Company has established procedures to periodically place before the Risk Management Committee and the Board of Directors, the risk assessment and minimisation procedures being followed by the Company and steps taken by it to mitigate these risks.

The Risk Management Policy, inter alia, includes identification therein of elements of risk, including those which in the opinion of the Board may threaten the existence of the Company. The 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 Company.

The development and implementation of Risk Management Policy adopted by the Company is discussed in detail in the Management Discussion and Analysis chapter, which forms part of this Annual Report.

WHISTLE BLOWER POLICY/VIGIL MECHANISM

The Company promotes ethical behaviour in all its business activities and has established a vigil mechanism for its Directors, Employees and Stakeholders associated with the Company to report their genuine concerns. The Vigil Mechanism as envisaged in the Companies Act, 2013 and the Rules prescribed thereunder and the Listing Regulations is implemented through the Whistle Blower Policy, to provide for adequate safeguards against victimisation of persons who use such mechanism and make provision for direct access to the Chairperson of the Audit Committee.

As per the Whistle Blower Policy implemented by the Company, the Employees, Directors, customers, dealers, vendors, suppliers, or any Stakeholders associated with the Company are free to report illegal or unethical behaviour, actual or suspected fraud or violation of the Company’s Codes of Conduct or Corporate Governance Policies or any improper activity to the Chairman of the Audit Committee of the Company or Chairman of the Company or Convenor of the Corporate Governance Cell.

The Whistle Blower Policy provides for protected disclosure and protection to the Whistle Blower. Under the Whistle Blower Policy, the confidentiality of those reporting violation(s) is protected and they are not subject to any discriminatory practices. Protected disclosures can also be made by sending an email at the designated email id : mmfsl_whistleblower@ mahindra.com.

The Whistle Blower Policy has been appropriately communicated within the Company and is available on the website of your Company at the web-link: http://www.mahindrafinance.com/pdf/MMFSL VigilMechanism.pdf

No personnel have been denied access to the Audit Committee.

SUBSIDIARIES, JOINT VENTURE AND ASSOCIATES

The Company’s subsidiaries and joint venture continue to contribute to the overall growth in revenues and overall performance of your Company.

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

The Policy for determining material subsidiaries as approved by the Board is hosted on the Company’s website and can be accessed at the web-link: http:// www.mahindrafinance.com/policies.aspx.

SUBSIDIARIES

Mahindra Insurance Brokers Limited

During the year under review, Mahindra Insurance Brokers Limited (MIBL), the subsidiary in the business of Direct and Re-insurance Broking, serviced approximately 2.59 million insurance cases, with a total of 20,58,613 cases for both Life and Non-Life Retail business. The customized Life insurance cover “Mahindra Loan Suraksha” (MLS) increased from 5,82,949 lives covered with a Sum Assured of Rs. 18,027.6 Crores in the Financial Year 2016-17 to 6,85,264 lives covered with a Sum Assured of Rs. 21,359.2 Crores in the Financial Year 2017-18. A substantial portion of MLS continues to be covered in the rural markets.

MIBL achieved a growth of 31% in Gross Premium facilitated for the Corporate and Retail business lines, increasing from Rs. 1,567.9 Crores in the Financial Year 2016-17 to Rs. 2,049.1 Crores in the Financial Year 2017-18. The Total Income increased by 41% from Rs. 174.2 Crores in the Financial Year 201617 to Rs. 245.1 Crores in the Financial Year 2017-18. The Profit Before Tax (PBT) recorded a marginal degrowth of 0.6% at Rs.81.2 Crores as compared to Rs.81.7 Crores in the same period of the previous year. The Profit After Tax (PAT) recorded a degrowth of 1.5% at Rs.52.2 Crores as against Rs.53.0 Crores in the same period of the previous year.

MIBL has been able to reach the benefit of insurance to over 2,00,000 villages across India.

Sale of 1,28,866 Equity Shares representing 5% of the total share capital of MIBL

During the year, your Company sold 1,28,866 Equity Shares aggregating 5% of the share capital of MIBL in favour of Inclusion Resources Private Limited for an overall consideration of Rs. 65 Crores, resulting in a profit of Rs. 65 Crores on sale of this investment. Post the sale, the shareholding of your Company stands reduced from 85% to 80% of MIBL’s share capital.

Mahindra Rural Housing Finance Limited

Mahindra Rural Housing Finance Limited (MRHFL), the Company’s subsidiary in the business of providing loans for purchase, renovation, construction of houses to individuals in the rural and semi-urban areas of the country, registered a total income of Rs. 1,000.0 Crores as compared to Rs. 703.4 Crores for the previous year, registering a growth of 42%. Profit before tax was 77% higher at Rs.224.6 Crores as compared to Rs. 126.9 Crores for the previous year. Profit after tax was 75% higher at Rs.145.5 Crores as compared to Rs. 83.0 Crores for the previous year.

During the year under review, MRHFL disbursed loans aggregating to Rs. 2,789.2 Crores (previous year Rs.2,116.2 Crores) achieving a growth of 32 percent over the previous year.

MRHFL continued its focus on serving customers in rural India. Majority of the loans disbursed were to customers in villages with an average annual household income of less than Rs.1.9 lakhs. During the year under consideration, MRHFL disbursed home loans to around 2,18,000 households (in addition to around 5,60,000 existing households as on 31st March, 2017). MRHFL has been expanding its geographical presence to provide affordable services for rural households.

During the year under review, operations of MRHFL were strengthened in the States of Maharashtra, Gujarat, Rajasthan, Tamil Nadu, Andhra Pradesh, Telangana, Chhattisgarh, Kerala, Karnataka, Madhya Pradesh, Uttar Pradesh, Uttarakhand and Bihar.

Mahindra Asset Management Company Private Limited

Mahindra Asset Management Company Private Limited (MAMCPL), a wholly-owned subsidiary of the Company acts as an Investment Manager for the schemes of Mahindra Mutual Fund. As on 31st March, 2018, MAMCPL was acting as the Investment Manager for six schemes.

The Assets under Management in these six schemes were Rs. 3,352 Crores in March 2018 as compared to Rs. 2,050 Crores in March 2017. Of these assets, Rs. 1,173 Crores were in retail schemes in March 2018 as compared to Rs. 319 Crores in March 2017. MAMCPL has empanelled more than 7,500 distributors and opened 1,26,737 investor accounts in these schemes recording a rise of more than 235%.

During the year under review, the total income of MAMCPL was Rs. 23.4 Crores as compared to Rs. 8.8 Crores for the previous year, registering a growth of 165%. The operations for the year have resulted in a loss of Rs. 38.1 Crores as against a loss of Rs. 20.5 Crores during the previous year.

Mahindra Trustee Company Private Limited

Mahindra Trustee Company Private Limited (MTCPL), your Company’s wholly-owned subsidiary, acts as the Trustee to Mahindra Mutual Fund.

During the year, MTCPL earned trusteeship fees of Rs.23.87 lakhs and other income of Rs.0.73 lakhs as compared to Rs.3.11 lakhs and Rs.0.06 lakhs respectively, for the previous year. The total expenses for the year were Rs.24.25 lakhs as against Rs. 23.52 lakhs in the previous year. MTCPL recorded a profit of Rs.0.35 lakhs for the year under review as against a loss of Rs. 20.4 lakhs in the previous year.

JOINT VENTURE Mahindra Finance USA LLC.

The joint venture company’s disbursement registered a growth of 8.34% to USD 828.38 Million for the year ended 31st March, 2018 as compared to USD 764.61 Million for the previous year.

Income grew by 27.98% to USD 54.61 Million for the year ended 31st March, 2018 as compared to USD 42.67 Million for the previous year. Profit before tax was 27.34% higher at USD 16.44 Million as compared to USD 12.91 Million for the previous year. Profit after tax grew at a healthy rate of 19.02% to USD 9.70 Million as compared to USD 8.15 Million in the previous year.

Names of companies which have become or ceased to be subsidiaries, joint ventures or associate companies during the year

During the year under review, no company has become or ceased to be a subsidiary, joint venture or associate of your Company.

The Company shall provide the copy of the annual accounts of its subsidiary companies and the related information to the Members of the Company on their request. The annual accounts of the subsidiary companies will also be kept open for inspection by any Member at the Registered Office of the Company and also at the Registered Office of the respective subsidiary companies during working hours upto the date of the Annual General Meeting.

The Annual Reports of the subsidiaries will also be available on your Company’s website at the web-link: http://www.mahindrafinance.com/annual-reports.aspx.

Material Subsidiary

Regulation 16[1][c] of the SEBI [Listing Obligations and Disclosure Requirements] Regulations, 2015 defines a “material subsidiary” to mean a subsidiary, whose income or net worth exceeds twenty percent of the consolidated income or net worth respectively, of the listed entity and its subsidiaries in the immediately preceding accounting year.

Under this definition, the Company did not have any material subsidiary, during the year under review.

The Policy for determining material subsidiaries as approved by the Board is uploaded on the Company’s website and can be accessed at the Web-link: http://www.mahindrafinance.com/pdf/ determining material subsidiaries.pdf

CONSOLIDATED FINANCIAL STATEMENTS

The Consolidated Financial Statements of the Company and its four subsidiaries, viz. Mahindra Insurance Brokers Limited, Mahindra Rural Housing Finance Limited, Mahindra Asset Management Company Private Limited and Mahindra Trustee Company Private Limited prepared in accordance with the Companies Act, 2013 and Accounting Standard AS 21 prescribed by The Institute of Chartered Accountants of India, 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 and its joint venture viz. Mahindra Finance USA LLC.

DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND THE COMPANY’S OPERATIONS IN FUTURE

There are no significant and material orders passed by the regulators or courts or tribunals that would impact the going concern status of the Company and its future operations.

DETAILS IN RESPECT OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS

Your Company has in place adequate internal financial controls with reference to financial statements, commensurate with the size, scale and complexity of its operations. Your Company uses Oracle based Systems as a business enabler and also to maintain its Books of Account. The transactional controls built into these systems ensure appropriate segregation of duties, appropriate level of approval mechanisms and maintenance of supporting records. The systems, Standard Operating Procedures and controls are reviewed by Management. These systems and controls are audited by Internal Audit and their findings and recommendations are reviewed by the Audit Committee which ensures the implementation. Review of the internal financial controls environment of the Company was undertaken during the year which covered verification of entity level control, process level control and IT controls, identification, assessment and definition of key business processes and analysis of risk control matrices, etc. The risk and control matrices are reviewed on a quarterly basis and control measures are tested and documented.

Reasonable Financial Controls are operative for all the business activities of the Company and no reportable material weakness or significant deficiencies in the design or operation of internal financial controls was observed.

Nonetheless your Company recognises that any internal control framework, no matter how well designed, has inherent limitations and accordingly, regular audits and review processes ensure that such systems are reinforced on an ongoing basis.

COMPLIANCE WITH THE PROVISIONS OF SECRETARIAL STANDARD - 1 AND SECRETARIAL STANDARD - 2

The Directors have devised proper systems to ensure compliance with the provisions of all applicable Secretarial Standards issued by the Institute of Company Secretaries of India and that such systems are adequate and operating effectively.

PARTICULARS OF REMUNERATION AND RELATED DISCLOSURES

Disclosures with respect to the remuneration of Directors, Key Managerial Personnel and Employees as required under Section 197(12) of the Companies Act, 2013 and Rule 5(1) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, are as under:

Disclosure Details

Ratio of the

Sl.

No.

Disclosure Requirement

Name of Director/ KMP

Designation

remuneration of each Director to median remuneration of Employees

1.

Ratio of the remuneration of each Director to the median remuneration

Mr. Dhananjay Mungale

Chairman

(Independent Director)

11.06X

of the employees of the Company for

Mr. M. G. Bhide

Independent Director

9.14X

the Financial Year 2017-18.

Mr. Piyush Mankad

Independent Director

8.78X

Mr. C. B. Bhave

Independent Director

8.45X

Ms. Rama Bijapurkar

Independent Director

7.85X

Mr. V. S. Parthasarathy

Non-Executive Director

NIL*

Dr. Anish Shah

Non-Executive Director

NIL*

Mr. Ramesh Iyer

Vice-Chairman & Managing Director

196.96X

Mr. V. Ravi

Executive Director & Chief Financial Officer

84.99X

Ms. Arnavaz M.

Company Secretary &

19.76X

Pardiwalla

Compliance Officer

* Mr. V. S. Parthasarathy and Dr. Anish Shah do not receive any remuneration from the Company.

Sl.

No.

Disclosure Details

Disclosure Requirement

Name of Director/KMP

Designation

% increase in Remuneration

2.

Percentage increase in Remuneration of each Director, Chief Financial

Mr. Dhananjay Mungale

Chairman (Independent Director)

1.82

Officer and Company Secretary during

Mr. M. G. Bhide

Independent Director

4.53

the Financial Year 2017-18.

Mr. Piyush Mankad

Independent Director

6.83

Mr. C. B. Bhave

Independent Director

2.81

Ms. Rama Bijapurkar

Independent Director

1.71

Mr. V. S. Parthasarathy

Non-Executive Director

NIL*

Dr. Anish Shah

Non-Executive Director

NIL*

Mr. Ramesh Iyer

Vice-Chairman & Managing Director

-11.53

Mr. V. Ravi

Executive Director & Chief Financial Officer

-13.94

Ms. Arnavaz M.

Company Secretary &

-11.16

Pardiwalla

Compliance Officer

* Mr. V. S. Parthasarathy and Dr. Anish Shah do not receive any remuneration from the Company.

3.

Percentage increase in the median

5.22% considering employees who were in employment for the whole of the

Remuneration of employees in the

Financial Year 2016-17 and Financial Year 2017-18.

Financial Year 2017-18.

4.

Number of Permanent employees on the rolls of the Company as on 31st March, 2018.

18,733

5. Average percentile increase already made in the salaries of employees other than the Managerial Personnel in the last Financial Year i.e. 201718 and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration.

For employees other than Managerial Personnel who were in employment for the whole of the Financial Year 2016-17 and Financial Year 2017-18, the average increase is 5.62%.

Average decrease for Managerial Personnel is 12.20%

Justification: The remuneration of the Vice-Chairman & Managing Director and Executive Director & Chief Financial Officer is decided based on the individual performance, inflation, prevailing industry trends and benchmarks.

The remuneration of eligible Non-Executive Directors consists of commission and sitting fees. While deciding the remuneration, various factors such as Director’s participation in Board and Committee Meetings during the year other responsibilities undertaken, such as Membership or Chairmanship/ Chairpersonship of Committees, etc., were taken into consideration.

The increment given to each individual employee is based on the employees’ potential, experience as also their performance and contribution to the Company’s progress over a period of time and also benchmarked against a comparator basket of relevant companies in India.

6. Affirmation that the remuneration is

The remuneration paid/payable is as per the Policy on Remuneration of

as per the Remuneration Policy of the

Directors and Remuneration Policy for Key Managerial Personnel and

Company

Employees of the Company.

Notes:

1] The remuneration calculated is as per Section 2[78] of the Companies Act, 2013 and includes the perquisite value of Stock Options of the Company exercised during the year

2] The calculations are based on Employees who were on the rolls of the Company for the whole of the Financial Year 2016-17 and Financial Year 2017-18.

Mr. Ramesh Iyer, Vice-Chairman & Managing Director and Mr. V. Ravi, Executive Director & Chief Financial Officer of the Company do not receive any remuneration or commission from its Holding Company. However, Mr. Iyer has been granted stock options under the Employees’ Stock Option Scheme of the Holding Company, Mahindra & Mahindra Limited. Mr. Iyer has not exercised ESOPs of the Holding Company, during the year, which were granted in the earlier year[s].

During the year under review, Mr. Ramesh Iyer and Mr. V. Ravi have received a commission of Rs. 76,56,314 and Rs. 19,15,000, respectively, from Mahindra Insurance Brokers Limited, a subsidiary of the Company. Further in the year under review, 1,14,273 stock options have been granted to Mr. Ramesh Iyer and 28,568 stock options have been granted to Mr. V. Ravi under the Employees’ Stock Option Scheme of Mahindra Rural Housing Finance Limited, the Company’s subsidiary company.

The Company had 14 employees who were in receipt of remuneration of not less than Rs. 1,02,00,000 during the year ended 31st March, 2018 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] and 5 [3] of Companies [Appointment and Remuneration of Managerial Personnel] Rules, 2014 are available at the Registered Office of the Company during working hours, 21 days before the

Annual General Meeting and shall be made available to any shareholder on request. Such details are also available on your Company’s website and can be accessed at the web-link: http://www.mahindrafinance.com/annual-reports.aspx. None of these employees is a relative of any Director of the Company.

None of the employees holds either by himself/herself or along with his/her spouse or dependent children, more than two per cent of the Equity Shares of the Company.

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

Your Company is an equal opportunity employer and is committed to ensuring that the work environment at all its locations is conducive to fair, safe and harmonious relations between employees. It strongly believes in upholding the dignity of all its employees, irrespective of their gender or seniority. Discrimination and harassment of any type are strictly prohibited.

The Company has in place an appropriate Policy in accordance with the provisions of the Sexual Harassment of Women at Workplace [Prevention, Prohibition and Redressal] Act, 2013, to prevent sexual harassment of its employees.

Internal Complaints Committee [ICC] has been set up to redress complaints received regarding sexual harassment.

All employees (permanent, contractual, temporary and trainees) are covered under this Policy. The Policy has been widely communicated internally and is placed on the Company’s intranet portal. The Company ensures that no employee is disadvantaged by way of gender discrimination.

The following is a summary of Sexual Harassment complaint(s) received and disposed off during the year 2017-18, pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and Rules framed thereunder:

(a) Number of complaint(s) of Sexual Harassment received during the year - 1

(b) Number of complaint(s) disposed off during the year - 1

(c) Number of cases pending for more than 90 days - 0

(d) Number of workshops/awareness programme against sexual harassment carried out - 1 workshop was conducted at the Company’s Corporate Office. Awareness on sexual harassment was carried out to sensitize employees of the Company at branches pan-India.

(e) Nature of action taken by the employer or District Officer - Warning letter was issued to the alleged employee.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars in respect of conservation of energy, technology absorption and foreign exchange earnings and outgo, as required under sub-section (3) (m) of section 134 of the Companies Act, 2013 read with Rule (8)(3)of the Companies (Accounts) Rules, 2014 are given as under :

(A) Conservation of Energy

(i) The steps taken or impact on conservation of energy:

The operations of your Company are not energy intensive. However, adequate measures have been initiated to reduce energy consumption.

Select few steps are listed:

a) Replacement of conventional lighting with Light Emitting Diode (LED) lighting :

The Company has installed LED lighting in Regional Offices of the Company during the year under review and the same has been monitored in terms of electrical consumption and expenses.

b) Replacement of old air-conditioning with updated version of machines with R-410A gas, which helps in reducing Ozone depletion.

c) Reduction in water and energy consumption and recycling of waste generation at various locations.

(ii) The steps taken by the Company for utilising alternate sources of energy: Nil.

(iii) The capital investment on energy conservation equipments: Nil.

(B) Technology Absorption

(i) The efforts made towards technology absorption:

Not Applicable.

(ii) The benefits derived like product improvement, cost reduction, product development or import substitution: Not Applicable.

(iii) I n case of imported technology (imported during the last three years reckoned from the beginning of the Financial Year): Not Applicable.

(a) Details of Technology Imported;

(b) Year of Import;

(c) Whether the Technology has been fully absorbed;

(d) if not fully absorbed, areas where absorption has not taken place, and the reasons thereof.

(iv) Your Company has not incurred any expenditure on Research and Development during the year under review.

(C) Foreign Exchange Earnings and Outgo

The information on foreign exchange outgo is furnished in the Notes to the Accounts. There were no foreign exchange earnings during the year.

For and on behalf of the Board

Dhananjay Mungale

Chairman

Place: Mumbai

Date : 25th April, 2018


Mar 31, 2017

Dear Shareholders

The Directors present their Report together with the audited financial statements of your Company for the year ended 31st March, 2017.

A. FINANCIAL AND OPERATIONAL HIGHLIGHTS

(Rs. in crores)

2017

2016

Revenue from Operations

47,096

43,639

Other Income

1,342

850

Profit before Depreciation, Finance Costs, Exceptional items and Taxation

6,112

5,470

Less: Depreciation and Amortisation expense

1,327

1,068

Profit before Finance Costs, Exceptional items and Taxation

4,785

4,402

Less: Finance Costs

146

186

Profit before Exceptional items and Taxation

4,639

4,216

Add: Exceptional items

548

68

Profit before Taxation

5,187

4,284

Less: Tax Expense

1,231

1,079

Profit for the year

3,956

3,205

Balance of profit for earlier years

17,904

15,442

Less: Transfers from retained earnings

14

3

Add: Transfers to retained earnings

—

100

Profits available for appropriation

21,846

18,744

Add: Other Comprehensive Income / (Loss)*

(4)

7

Less: Dividend paid on Equity Shares

745

745

Less: Income-tax on Dividend paid

96

102

Balance carried forward

21,001

17,904

* Remeasurement of (loss)/gain (net) on defined benefit plans, recognised as part of retained earnings.

The fiscal year gone by was marked by significant developments on both the global as well as domestic fronts. On the international front, Brexit and the US elections heralded a sea change, forebodingly laden with darker possibilities for the global and even the Indian economy. The political outlook for globalisation too changed in the wake of the above developments.

On the domestic side, a constitutional amendment paved the way for the long-awaited and transformational Goods and Services Tax (GST) while demonetisation of large denomination currency notes signalled a regime shift to punitively raise the costs of unaccounted transactions.

The currency swap move entailed short-term costs in the form of economic dislocations across Sectors, inconvenience and hardships, especially for those in the informal and cashintensive sectors of the economy who lost out on income and employment. These costs have been real and significant but they may be minimised in recorded GDP because the national income accounts estimate informal activity on the basis of formal sector indicators. However, the costs are likely to be transitory as demonetisation has the potential to generate meaningful long-term benefits. Gross value added (GVA) growth estimate for 2016-17 has been pared down to 6.6% year on year as compared to the estimate of 7.6% when the year began.

However, even amidst this scenario, your Company recorded an increase of 7.92% in revenue from operations at Rs. 47,096 crores in the year under review as against Rs. 43,639 crores in the previous year.

The Profit for the year before Depreciation, Finance Costs, Exceptional items and Taxation recorded an increase of 11.74% at Rs. 6,112 crores as against Rs. 5,470 crores in the previous year. Profit after tax increased by 23.43% at Rs. 3,956 crores as against Rs. 3,205 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 and process efficiencies thereby enabling the Company to maintain profitable growth in the current economic scenario.

No material changes and commitments have occurred after the closure of the Financial Year 2016-17 till the date of this Report, which would affect the financial position of your Company.

Performance Review Automotive Sector

Your Company’s Automotive Sector recorded total sales of 5,06,624 vehicles (4,52,893 four-wheelers and 53,731 three-wheelers) as against a total of 4,94,096 vehicles (4,37,911 four-wheelers and 56,185 three-wheelers) in the previous year, registering a growth of 2.5% in vehicle sales.

On the domestic sales front, your Company sold a total of 4,69,384 vehicles as compared to 4,58,065 vehicles in the previous year resulting in a growth of 2.5%.

In the Passenger Vehicle segment, your Company’s volumes remained almost flat at 2,36,130 vehicles [including 2,22,541 Utility Vehicles (UVs), 10,370 Vans and 3,219 Cars] as compared to the previous year’s volume of 2,36,307 vehicles [including 2,22,324 UVs, 10,588 Vans and 3,395 Cars].

In the Commercial Vehicle (CV) segment, your Company sold 1,80,948 vehicles [including 30,043 vehicles < 2T GVW, 1,36,564 vehicles between 2-3.5T GVW, 7,626 Light Commercial Vehicles (LCVs) in the LCV > 3.5T segment and 6,715 Heavy Commercial Vehicles (HCVs)] registering a growth of 8.5% over the previous year’s volume of 1,66,783 CV [including 27,834 vehicles < 2T GVW, 1,26,819 vehicles between 2-3.5T GVW, 6,425 LCVs in the LCV > 3.5T segment and 5,705 HCVs].

In the three-wheeler segment, your Company sold 52,306 three-wheelers, registering a de-growth of 4.9% over the previous year’s volume of 54,975 three-wheelers.

For the year under review, the Indian automotive industry (except 2-Wheeler) grew 6.5%, with the Passenger Vehicle (PV) industry growth of 9.2% and record sales crossing the three million mark. The CV industry grew 4.2% with the LCV 2-3.5T (PU segment) posting the highest ever sales of 0.2 million and taking 29% share of the total CV industry. However, the Medium and Heavy Commercial Vehicles (MHCV) segment remained flat at a volume of 0.3 million. The 2-Wheeler (2W) industry grew 6.9%, with sales crossing a record 17 million mark.

Your Company’s UV sales volume remained flat at 2,22,541 vehicles, resulting in an UV market share of 29.2% as against 37.9% in the previous year. Your Company’s UV sales were adversely impacted in the first, third quarter and the early fourth quarter of the Financial Year 2017.

In the first quarter of the Financial Year 2017, rural demand continued to be subdued - a low sentiment continuing from the Financial Years 2015 and 2016 due to two years of deficit monsoon. In the third quarter of the Financial Year 2017, volumes were adversely impacted due to demonetisation. Though the industry at large was quick to recover in January, 2017 recovery was slightly slower in rural India as compared to urban India, having an adverse impact on your Company’s volumes. Demand for your Company’s products from urban markets was also under pressure due to continued shift in customer preference.

Scorpio continues to enhance its iconic status and the demand for Scorpio remained strong at 49,319 vehicles, a growth of 2.6% over the previous year.

Bolero has been a very successful brand for your Company over the last 10 years, and in September, 2016, your Company launched the new Bolero Power with the mHawkD70 engine. The all New Bolero Power is an evolution of the Bolero brand, with an enhanced value proposition, delivering more power, mileage and a peppier drive.

In the LCV<2T segment, riding on the success of Jeeto, your Company’s volumes grew 7.9% and the market share strengthened to 25.7% as against 23.9% in the previous year. To further strengthen its presence in this segment, your Company launched the Supro Minitruck and Supro cargo van in February, 2017.

In the PIK-UP segment of commercial vehicles (LCV 2 to 3.5T), your Company maintained its leadership position with a market share of 65.8%. In April, 2016, your Company launched the Big Bolero PIK-UP with several best-in-class features.

In February, 2016, your Company launched the Blazo series of heavy commercial (HCV) trucks with Fuelsmart technology. The Blazo series of trucks are backed by a superior mileage guarantee and a 48 hours service guarantee. For the year under review, your Company extended the Blazo range of trucks from 25 to 49 Tons, and the trucks are well received by the customer. The total HCV sales for the year stood at 6,715 trucks, clocking a 17.7% growth. The market share of the HCV segment stood at 4.0% as compared to 3.4% in the previous year.

During the year under review, your Company posted the highest ever export volumes of 37,240 vehicles as against the previous year exports of 36,031 vehicles, a growth of 3.4%.

Your Company continued to grow in volumes and strengthen its presence in the neighbouring markets of Sri Lanka, Nepal and Bangladesh. With continued efforts of building its brand in key markets like South Africa and Chile, your Company reported a volume growth of 28.9% and 28.3% respectively. For the year under review, the KUV100 and TUV300 were launched in South Africa.

The spare parts sales for the year stood at Rs. 1,937.2 crores (including Exports of Rs. 115.6 crores) as compared to Rs. 1,765.3 crores (including Exports of Rs. 110.3 crores) in the previous year, registering a growth of 9.7%.

Farm Equipment Sector

Your Company recorded a total sales of 2,63,021 tractors as against 2,14,173 tractors sold in the previous year thus recording a growth of 22.8%.

For the year under review, the tractor industry in India recorded sales of 5,82,084 tractors recording a growth of 18%. A normal monsoon, good increase in minimum support prices and Government’s focus on Agriculture and rural development, helped drive the positive sentiment in the Agriculture Sector and the rural economy at large. This positive sentiment and the pent-up demand due to two consecutive years of industry de-growth in the Financial Years 2015 and 2016, helped boost the demand for tractors in the Financial Year 2017.

Your Company sold 2,48,594 tractors in the domestic market in the year 2016-17, as compared to 2,02,628 tractors in the previous year, recording a growth of 22.7%. Your Company gained market share by 1.8%, taking the total market share to 42.7% which is the highest ever market share.

Your Company’s market performance was supported by the good performance of YUVO, which has helped gain market share in the 30-50 HP segment. YUVO, an all-new tractor platform launched in April, 2016 has been highly successful in strengthening the technology leadership of Mahindra tractors.

After the successful launches of Arjun NOVO and YUVO in the previous two years, your Company launched its third new tractor platform JIVO in April, 2017. JIVO is a new age small tractor platform in the sub 25 HP category. With its narrow and compact design, high power and multi-application suitability, JIVO is an ideal choice for the growing segment of Horticulture and Row crop farming.

During the year under review, your Company exported 14,583 (including 156 Completely Knocked Down Units) tractors registering a growth of 26.3% over the previous year. This is the highest ever tractor exports by your Company.

Spare parts sales for the year stood at Rs. 530.7 crores (including exports of Rs. 43.8 crores) as compared to Rs. 476.5 crores (including exports of Rs. 34.8 crores) in the previous year, registering a growth of 11.4%.

Other Businesses

In the power generation space, under the Mahindra Powerol Brand, your Company continues to be amongst the leaders in the industry for over a decade. Your Company earned its highest ever revenues of Rs. 1,204.9 crores in the current Financial Year as against Rs. 1,109.9 crores in the previous year, recording a growth of 8.6%.

With a focus on changing customer needs, your Company has further expanded the business in Tele infra management and in the energy management solutions space.

Amidst growing concerns on environmental sustainability, your Company took a step towards moving to greener solutions, by venturing into a new business of ‘Green Gensets’ through battery based solutions.

Current Year’s review

During the period 1st April, 2017 to 29th May, 2017, 63,251 vehicles were produced as against 60,164 vehicles and 60,052 vehicles were despatched as against 57,697 vehicles during the corresponding period in the last year. During the same period 49,425 tractors were produced and 49,154 tractors despatched as against 44,730 tractors produced and 44,778 tractors despatched during the corresponding period in the previous year.

The outlook for 2017-18 remains positive with a favourable domestic and global backdrop. On the domestic front, the economy is set to experience a growth recovery and the RBI expects Gross Value Added to grow at 7.3% Year on Year in Financial Year 2018 with some favourable tailwinds.

Monsoon is forecast to be normal for the second consecutive year which bodes well for demand recovery. Moreover, the ongoing remonetisation process and lagged effect of past rate cuts along with a further reduction in banks’ lending rates will aid discretionary consumer spending and growth recovery.

Focused expenditure especially on the rural economy and affordable housing, implementation of Goods and Services Tax (GST) and steps to attract higher foreign direct investment (FDI) will also be supportive of growth. Importantly, notwithstanding initial challenges, GST implementation entails sustained positive gains for the economy in the long term.

On the global front too, demand backdrop is expected to be favourable with most forecasts pegging global output and trade higher in 2017 and 2018 as compared to the recent past.

Finance

Financial Year 2016-17 was a turbulent year for the world economy with events namely Brexit, US Presidential elections and Italian political reform referendum, which not only caused volatility during the year but also has the potential to have ramifications in the years to come. US economy continued showing signs of steady recovery and encouraging job growth which led the US Federal Reserve to hike interest rates two times in Financial Year 2016-17 by a cumulative 50 bps. Despite the political noise, the economic recovery in Eurozone was encouraging with growth picking up in the second half of 2016, which led the ECB to start tapering its quantitative easing program since December, 2016. Economic sentiment in Eurozone reached a nearly six-year high in February, 2017. Growth also remained solid in the United Kingdom, where spending proved resilient in the aftermath of Brexit.

Growth prospects for emerging market economies have also improved with reduced concerns on China’s hard landing due to policy stimulus. Further, recessionary conditions also ebbed in Russia and Brazil due to firming up of commodity prices. Crude prices which touched a 13 year low in January, 2016, rebounded during Financial Year 2016-17 as oil producing nations agreed on output cuts. However, global trade remains subdued due to an increasing tendency towards protectionist policies and heightened political tensions. The latest World Economic Outlook by IMF predicts the Global economic activity to pick up with a long-awaited cyclical recovery in investment, manufacturing and trade projects.

On the domestic front in India also, the year was marked with two game changing events viz., Demonetization and passing of Goods and Services Tax (GST). Demonetisation, albeit its short term adverse impact on economy, has positively impacted the digital payments landscape in the country. GST holds the potential of providing impetus to growth and investments in the long term and is expected to benefit the GDP by more than 1%.

With positive macro-economic indicators, commitment to fiscal and monetary reforms and political stability, India continued to be a bright spot for global investors. Foreign Direct Investment (FDI) in Financial Year 2016-17 touched a record high of USD 60.1 billion. For the first time since the opening up of the economy in 1991, India’s current account deficit is being funded by FDI, a sign of rising confidence among long term investors. The Indian Rupee displayed two-way movements up to mid-January, 2017, but since then has appreciated on resumption of portfolio inflows in both the debt and equity segments.

CPI inflation remained firmly anchored within RBI’s target range which prompted them to reduce repo rates by a cumulative of 50 bps in Financial Year 2016-17. However, the persistence of core inflation, implementation of 7th pay commission and rise in global commodity prices led the RBI to undertake a calibrated shift in their policy stance from accommodative to neutral towards end of the Financial Year. Following the announcement of demonetisation in November, 2016, there was a huge surge in banking sector liquidity, impelling the Banks to reduce their lending rates and finally transmitting the policy rate cuts by the RBI over the last two years to the consumers.

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 Rs. 1,083.62 crores of long term borrowings from internal accruals.

During the year, your Company raised Rs. 475 crores by way of private placement of 7.57% Listed, Senior, Unsecured, Redeemable Non-Convertible Debentures with a 10 years’ maturity. In addition, Euro 50 million was raised by way of External Commercial Borrowings for 5 years. The above borrowings were raised to part finance its ongoing modernisation and expansion programmes. In addition, your Company also availed export finance of Rs. 605 crores, out of which Rs. 305 crores was under the interest equalization scheme of Government of India.

The Company’s 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 total Debt to Equity Ratio was 0.11 as at 31st March, 2017.

Your Company has been rated by CRISIL Limited (“CRISIL”), ICRA Limited (“ICRA”), India Ratings and Research Private Limited (“India Ratings”) and Credit Analysis & Research Limited (“CARE”) for its Banking facilities under Basel II norms. All have re-affirmed the highest credit rating for your Company’s Short Term facilities. For Long Term facilities and Non-Convertible Debenture (“NCD”) programme, CRISIL and ICRA have re-affirmed their credit ratings of CRISIL AAA/ Stable and [ICRA]AAA (stable) respectively. Further, CARE has also re-affirmed the ratings of the Company’s long-term Bank facilities at CARE AAA. India Ratings and Research (Ind-Ra, a Fitch Group Company) has also re-affirmed Long-Term Issuer Rating of ‘IND AAA’ with a Stable outlook to your Company. 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.

Investor Relations (IR)

Your Company continuously strives for excellence in its IR engagement with International and Domestic investors and has set up feedback mechanism to measure IR effectiveness. Structured conference calls and periodic investor/analyst interactions including one-on-one meetings, Telepresence meetings, participation in investor conferences, quarterly earnings calls and annual analyst meet with the Chairman, Managing Director and Business Heads were organised during the year.

Your Company interacted with around 750 Indian and overseas investors and analysts (excluding quarterly earnings calls and specific event related calls) during the year.

Your Company always believes in leading from the front with emerging best practices in IR and building a relationship of mutual understanding with investor/analysts. As a key milestone in this continuing endeavour, your Company created a digital interactive annual review of the Company’s performance on the Corporate website to provide an interactive experience beyond what is available in the Annual Report. Your Company also continues to organise con-call on Environment, Social and Corporate Governance (ESG) for analysts and investors.

Your Company is pleased to report that the Company’s IR function was awarded ‘Overall Best Company in India for Corporate Governance’ and ‘Best for Shareholders’ Rights and Equitable Treatment in India’ by ‘Asia Money’ based in Hong Kong.

Your Company ensures that critical information about the Company is available to all the investors by uploading all such information at the Company’s website. Your Company has created a ‘Group Investor Relations Council’ to share best practices across all the listed group companies and learn from each other.

Dividend

Your Directors are pleased to recommend a dividend of Rs. 13 per Ordinary (Equity) Share of the face value of Rs. 5 each, payable to those Shareholders whose names appear in the Register of Members as on the Book Closure Date. The equity dividend outgo for the Financial Year 2016-17, inclusive of tax on distributed profits (after reducing the tax on distributed profits of Rs. 44.17 crores on the dividends receivable from the subsidiaries during the current Financial Year) would absorb a sum of Rs. 927.62 crores [as against Rs. 841.68 crores comprising the dividend of Rs. 12 per Ordinary (Equity) Share of the face value of Rs. 5 each and tax thereon paid for the previous year]. Further, the Board of your Company decided not to transfer any amount to the General Reserve for the year under review.

Dividend Distribution Policy

The Board of Directors at its Meeting held on 10th August, 2016 approved the Dividend Distribution Policy containing the requirements mentioned in Regulation 43A of the Securities and Exchange Board of India (SEBI) (Listing Obligations and Disclosure Requirements) Regulations, 2015. The Policy is attached as Annexure I and forms part of this Annual Report.

B. CONSOLIDATED FINANCIAL STATEMENTS

The Consolidated Financial Statements of the Company and its subsidiaries, prepared in accordance with the Companies Act, 2013 and applicable 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 Financial Statements as stated above are also available on the website of the Company and can be accessed at the Web-link: http://www.mahindra.com/resources/investor-reports/FY17/Annual Reports/Links-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 (TML), the Company’s Flagship Company in the IT Sector, has reported a consolidated revenue of Rs. 29,141 crores in the current year as compared to Rs. 26,494 crores in the previous year, an increase of 10%. Its consolidated profit after tax is Rs. 2,813 crores as compared to Rs. 2,993 crores in the previous year, a decrease of 6%.

*The Group’s finance company, Mahindra & Mahindra Financial Services Limited (Mahindra Finance), reported a consolidated operating income of Rs. 7,146 crores during the current year as compared to Rs. 6,554 crores in the previous year, a growth of 9%. The consolidated profit after tax for the year is Rs. 512 crores as compared to Rs. 772 crores in the previous year.

* Mahindra Finance financials is as per Indian Generally Accepted Accounting Principles (IGAAP).

Mahindra Lifespace Developers Limited (MLDL), the subsidiary in the business of real estate and infrastructure registered a consolidated operating income of Rs. 762 crores as compared to Rs. 593 crores in the previous year. The consolidated profit after tax for the year is Rs. 102 crores as compared to Rs. 92 crores in the previous year.

Mahindra Holidays & Resorts India Limited, the subsidiary in the business of timeshare registered a consolidated operating income of Rs. 2,282 crores as compared to Rs. 1,602 crores in the previous year, an increase of 42%. The consolidated profit after tax for the year is Rs. 149 crores as compared to Rs. 87 crores in the previous year, an increase of 71%.

Ssyangyong Motor Company (SYMC), the Korean subsidiary of the Company has reported consolidated revenues of Rs. 21,153 crores in the current fiscal year as compared to Rs. 20,079 crores in the previous year, a growth of 5%. The consolidated profit after tax for the year is Rs. 245 crores as compared to consolidated loss of Rs. (166) crores in the previous year.

The consolidated group profit before exceptional item and tax for the year is Rs. 5,004 crores as against Rs. 4,794 crores in the previous year - a growth of 4%. The consolidated profit after tax after non-controlling interest and exceptional items for the year is Rs. 3,698 crores as against Rs. 3,148 crores in the previous year.

During the year under review, Mahindra West Africa Ltd, Trringo.com Limited, Merakisan Private Limited, Mahindra Airways Limited, Mahindra Mexico S. de. R. L., Bristlecone Middle East DMCC, Mahindra do Brasil Industrial Ltda., Classic Legends Private Limited, BSA Company Limited, Mahindra MSTC Recycling Private Limited, Mahindra Suryaurja Private Limited, 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 Homes Private Limited, Hisarlar Makina Sanayi ve Ticaret Anonim §irketi and Hisarlar ithalat ihracat Pazarlama Anonim §irketi became subsidiaries of your Company.

During the year under review, Caribia Service Oy, Are Semesterby A AB, Are Semesterby B AB, Are Semesterby C AB, Are Semesterby D AB, Kiinteisto Oy Tunturinrivi, Saimaa Gardens Arena Oy, Merakisan Private Limited and Mahindra Internet Commerce Private Limited ceased to be subsidiaries of your Company.

Subsequent to the year end, Mahindra Automotive North America Inc. and Merakisan Private Limited became subsidiaries of your Company.

During the year under review, Mahindra Univeg Private Limited changed its name to Mahindra Greenyard Private Limited and Mahindra Reva Electric Vehicles Limited changed its name to Mahindra Electric Mobility Limited.

During the year under review, Sampo Rosenlew Oy and PF Holdings B.V. became Associates of your Company and Mahindra Sona Limited ceased to be a Joint Venture of your Company.

A Report on the performance and financial position of each of the subsidiaries, associates and joint venture companies included in the Consolidated Financial Statement 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 at the Web-link: http://www.mahindra.com/resources/ investor-reports/FY17/Annual Reports/Links-AnnualReport.zip

C. JOINT VENTURES, ACQUISITIONS AND OTHER MATTERS

Demerger of Two-Wheeler Business of Mahindra Two Wheelers Limited (MTWL) into your Company Mahindra Two Wheelers Limited (“MTWL”), a step down subsidiary of your Company, is engaged in the businesses of manufacturing and selling of two wheelers (“Two Wheelers Business”) and trading in spare parts and accessories (“Spares Business”).

MTWL’s past business strategy was focused on addressing the mass two wheeler market. Given the market response, MTWL has decided to make a strategy shift by focusing on the niche premium two wheeler segment. As your Company is present in many segments of the automotive industry, it is envisaged to demerge the Two Wheeler Business into your Company. The proposed demerger would enable the Two Wheeler Business to also benefit from your Company’s R&D and sourcing capabilities. Besides, the proposed demerger of the Two Wheeler Business would enable MTWL to streamline its operations by focusing on the Spares Business.

To achieve the above, a Scheme of Arrangement between Mahindra Two Wheelers Limited and the Company and their respective Shareholders and Creditors (“Scheme”) was announced by your Company whereby MTWL would demerge the Two Wheeler Business into your Company. The appointed date of the Scheme is 1st October, 2016. In accordance with the Scheme, your Company shall be allotting 4,63,287 Ordinary (Equity) Shares of Rs. 5 each to Aay Kay Global and 40,601 Ordinary (Equity) Shares of Rs. 5 each to Emerging India Fund, the shareholders of MTWL, in the share exchange ratio of 1 fully paid-up Ordinary (Equity) Share of Rs. 5 each of the Company for every 461 fully paid-up shares held in MTWL.

The Company had received the Observation Letters dated 8th March, 2017 from BSE Limited (‘BSE’) and dated 10th March, 2017 from the National Stock Exchange of India Limited (‘NSE’), conveying no objection to the Scheme. Subsequent to the year end, pursuant to the directions of the National Company Law Tribunal, Mumbai Bench by its Order dated 5th April, 2017 a Meeting of the Equity Shareholders of the Company has been convened on 13th June, 2017, for seeking approval to the Scheme.

Acquisition of assets of Bramont Montadora Industrial e Comercial de Veiculos S.A.

As a part of its strategy to expand its operations in the Brazilian market, your Company had appointed Bramont Montadora Industrial e Comercial de Veiculos S.A. (“Bramont”) as a distributor in Brazil since 2012. In October, 2016, your Company along with Mahindra Overseas Investment Company (Mauritius) Limited (“MOICML”) acquired 100% of the equity (‘Quota’) capital of Mahindra do Brasil Industrial Ltda. Your Company invested approximately USD 7.5 million in the equity capital of Mahindra do Brasil Industrial Ltda., for acquisition of Bramont’s assets. Given the importance of the Brazilian market, the acquisition of Bramont’s assets would help your Company in having a direct presence through its own assembly facility and distribution network in the Brazilian market.

Acquisition of BSA brands for Two Wheeler

With a view to realign the Two Wheeler Business of your Company to focus on premium niche segments and to create an international motorcycle company and revive vintage motorcycle brands, your Company, through its subsidiary Classic Legends Private Limited (CLPL) has acquired 100% of the share capital of UK based BSA Company Limited (BSA) on 20th October, 2016 for a consideration of GBP 3.4 million.

BSA was incorporated in the UK in December, 1980 and has a presence in Japan, Singapore, Malaysia, USA, Mexico and Canada. The principal activity of BSA is licensing of its brands.

The BSA brand, which has a global appeal, will be primarily suited to international markets.

Acquisition of 75.1% stake in Hisarlar Makina Sanayi ve Ticaret Anonim §irketi, Turkey

In line with the vision of your Company’s Farm Equipment Sector to pursue a globalisation strategy and expand your Company’s product portfolio to include various new categories of farm machinery, your Company has entered into definitive agreements on 19th January, 2017, for acquiring 75.1% stake in Hisarlar Makina Sanayi ve Ticaret Anonim §irketi (“Hisarlar”) for a consideration of Turkish Lira 71 million (equivalent to approximately Euro 18 million) through a capital increase. This transaction was completed on 30th March, 2017. Hisarlar is a key player in tractor cabins, machinery components and agricultural machinery industry. It had revenues of Turkish Lira 215 million (approximately Euro 55 million) in 2016, with exports constituting approximately 40% of sales. Hisarlar has two production facilities in Western Turkey and employs approximately 820 people. Hisarlar is the market leader in Turkey in the soil preparation category of farm implements, supported by a distribution network of nearly 85 dealers across Turkey. This acquisition is an important milestone in your Company’s globalisation journey.

Sale of 66,58,565 Equity Shares of Mahindra Holidays & Resorts India Limited in the Open Market through Stock Exchange

During this year, your Company, in order to increase the free float and to unlock part value out of its investments in Mahindra Holidays & Resorts India Limited (“MHRIL”), a listed subsidiary of your Company, sold around 7.5% of its holding in MHRIL, on the Stock Exchange, at an average gross price of Rs. 412.05 per share, resulting in a gain of Rs. 269 crores to your Company. Following this sale, the shareholding of your Company has come down from 75% to 67.5% of MHRIL’s share capital.

Sale of 32,75,000 shares of Mahindra Sona Limited

As a part of the strategy of your Company to divest from non-core investments, your Company sold its entire holding of 32,75,000 Equity Shares (29.77%) in Mahindra Sona Limited (“Mahindra Sona”) in favor of the other Promoter of Mahindra Sona, namely, M Sona Automotive Private Limited, for an overall consideration of Rs. 89.32 crores, resulting in a profit of Rs. 85.86 crores on sale of this investment in Financial Year 2017.

D. INTERNAL FINANCIAL CONTROLS

The Corporate Governance Policies guide the conduct of affairs of your Company and clearly delineates 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 also 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 Information Management Policy reinforces the control environment. The systems, Standard Operating Procedures and controls are reviewed by Management. These systems and controls are audited by Internal Audit and their findings and recommendations are reviewed by the Audit Committee which ensures the implementation.

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. 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 Management, no reportable material weakness or significant deficiencies in the design or operation of internal financial controls was observed. Nonetheless your Company recognises that any internal control framework, no matter how well designed, has inherent limitations and accordingly, regular audits and review processes ensure that such systems are reinforced on an ongoing basis.

Indian Accounting Standards (Ind AS) - IFRS Converged Standard

Your Company has adopted Indian Accounting Standards (“Ind AS”) for the accounting period beginning on 1st April, 2016 pursuant to Ministry of Corporate Affairs Notification dated 16th February, 2015 notifying the Companies (Indian Accounting Standard) Rules, 2015.

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. CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All Related Party Transactions entered during the year were in the Ordinary Course of Business and on arms length basis. During the year under review, your Company had entered into Material Related Party Transactions, i.e. transactions exceeding ten percent of the annual consolidated turnover as per the last audited financial statements, with Mahindra Vehicle Manufacturers Limited, a wholly owned subsidiary of your Company. These transactions too were in the Ordinary Course of Business of your Company and were at Arm’s Length Basis, details of which, as required to be provided under section 134(3)(h) of the Companies Act, 2013 are disclosed in Form AOC-2 as Annexure II and forms part of this Annual Report.

The policy on Related Party Transactions as approved by the Board is uploaded on the Company’s website and can be accessed at the Web-link: http://www.mahindra.com/resources/ investor-reports/FY17/Annual Reports/Links-AnnualReport.zip

G. AUDITORS

Statutory Auditors and Auditors’ Report

Messrs Deloitte Haskins & Sells, Chartered Accountants (ICAI Registration No. 117364W) the retiring Auditors have completed the maximum tenure as Statutory Auditors of the Company as provided under the Companies Act, 2013 and relevant Rules thereunder.

The Board of Directors on the recommendation of the Audit Committee has approved and recommended to the Members, the appointment of Messrs B S R & Co. LLP, Chartered Accountants (Firm Registration Number 101248W/W-100022) who have given a written consent to act as Statutory Auditors of your Company and have also confirmed that the said appointment would be in conformity with the provisions of sections 139 and 141 of the Companies Act, 2013 read with the Companies (Audit and Auditors) Rules, 2014.

The Members are requested to appoint Messrs B S R & Co. LLP as Statutory Auditors of the Company in place of the retiring Auditors Messrs Deloitte Haskins & Sells, Chartered Accountants at the ensuing Annual General Meeting for a period of 5 years from the conclusion of the ensuing Annual General Meeting till the conclusion of the 76th Annual General Meeting and fix their remuneration.

The Auditors’ Report is unmodified i.e. it does not contain any qualification, reservation or adverse remark.

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 Report as Annexure III, a Secretarial Audit Report given by the Secretarial Auditor.

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

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 2016-17.

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 2017-18 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 arms 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.

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, details of which needs to be mentioned in this Report.

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. 56, 4, and 9 to the Financial Statements.

I. PUBLIC DEPOSITS AND LOANS/ADVANCES

Your Company had discontinued its Fixed Deposit Scheme for 36 months with effect from the close of office hours on 31st January, 2014 and has also discontinued acceptance of Fixed Deposits with effect from 1st April, 2014.

All the deposits from public and Shareholders had already matured as at 31st March, 2017. The total of such 126 deposits amounting to Rs. 83.60 lakhs had not been claimed as at the end of the Financial Year. Since then 32 of these deposits of the value of Rs. 15.85 lakhs has 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, etc., required to be disclosed in the Annual Accounts of the Company pursuant to Para A of Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 are furnished separately.

J. EMPLOYEES

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) Mr. Anand G. Mahindra - Executive Chairman

(b) Dr. Pawan Goenka - Managing Director

(c) Mr. V S Parthasarathy - Group CFO & Group CIO

(d) Mr. Narayan Shankar - Company Secretary

During the year, the Board of Directors of the Company, at its Meeting held on 11th November, 2016 had pursuant to the recommendations of the Governance, Nomination and Remuneration Committee and subject to the approval of Members at the ensuing Annual General Meeting of the Company:

(a) Designated and appointed Mr. Anand G Mahindra as Executive Chairman of the Company for a period of five years with effect from 12th November, 2016 upto and including 11th November, 2021; and

(b) Appointed Dr. Pawan Goenka as Managing Director of the Company for a period of four years from 12th November, 2016 upto and including 11th November, 2020.

There has been no other change in the KMPs during the year under review.

Employees’ Stock Option Scheme

During the year under review, on the recommendation of the Governance, Nomination and Remuneration Committee 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.

The Company has in force the following Schemes which get covered under the provisions of SEBI (Share Based Employee Benefits) Regulations, 2014 (“SBEB Regulations”):

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

There are no material changes made to the above Schemes and these Schemes are in compliance with the SBEB Regulations. Your Company’s Auditors, Messrs Deloitte Haskins & Sells, have certified that the Company’s above-mentioned Schemes have been implemented in accordance with the SBEB Regulations, and the Resolutions passed by the Members for the 2000 Scheme and the 2010 Scheme.

Information as required under the SBEB Regulations read with SEBI Circular CIR/CFD/POLICY CELL/2/2015 dated 16th June, 2015 have been uploaded on the Company’s website and can be accessed at the Web-link: http://www.mahindra.com/resources/ investor-reports/FY17/Annual Reports/Links-AnnualReport.zip

Particulars of Employees and related disclosures

The Company had 251 employees who were in receipt of remuneration of not less than Rs. 1,02,00,000 during the year ended 31st March, 2017 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 Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are available at the Registered Office of the Company during working hours, 21 days before the Annual General Meeting and shall be made available to any Shareholder on request. Such details are also available on your Company’s website and can be accessed at the Web-link: http://www. mahindra.com/resources/investor-reports/FY17/Annual Reports/Links-AnnualReport.zip

Disclosures with respect to the remuneration of Directors, 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 IV 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, which aims to create an engaged workforce and an innovative, productive and competitive shop-floor ecosystem, continues to grow in strength. The Transformational Work Culture Committee (TWCC) continually engages with long-term strategic initiatives which range from anticipated Labour Law reforms to ‘Swachh Bharat Abhiyaan’.

Some examples of the programs put in place include Rise for Associates, Industrial Relations Skills for Frontline Officers, Cultural Diagnostics Projects, Transformational work culture Projects, e-Compliance, e-Quiz for associates, e-portal on reward and recognition for associates, e-safety module, Code of Conduct for Associates, and cutting edge ER Practices in collaboration with Mahindra Leadership University (MLU).

In order to develop skills and foster togetherness at the workplace, your Company rolled out multiple training and engagement programs covering a wide range of topics, viz. positive attitude, stress management, creativity, team effectiveness, safety and environment, quality tools, TPM, skill building programs, customer focus, awareness on Promise 2019, Code of Conduct and a Union Leadership Development Program.

The Mahindra Skill Excellence initiative is a holistic approach to enhance the skill and capabilities of shop floor associates, and has received good participation across manufacturing facilities. As a result of this effort, an associate from your Company will represent India at the Worlds Skill Competition -Abu Dhabi in August, 2017. This will be the third year in a row, where your Company’s associates will represent India at the World Skills Competition.

In an endeavor to generate ideas towards improving quality, reducing cost, ensuring safety and improving productivity, your Company’s shop floor associates generated about 20 ideas per person.

Significant emphasis was also laid towards raising awareness on health and wellness of employees through annual medical check-ups, health awareness activities and diet food which has become a way of life in the last three years. Software, which generates a complete report for each individual, has been a useful tool in identifying the employees who require focused 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’ and 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 Mahindra

Automotive and Tractor manufacturing locations. Bonus settlements were amicably agreed upon at all locations. All this resulted in zero production loss in the Financial Year 2016-17 and helped create a peaceful, healthy and collaborative work environment.

Safety, Occupational Health and Environment

The Company revised its Safety, Occupational Health & Environmental (SOH&E) Policy which, inter alia, covers and focusses on strengthening SOH&E awareness amongst all employees and stakeholders of your Company. The revised SOH&E Policy ensures compliance regarding skills and competency development of employees, business associates, plant and equipment, by maintaining e-compliance systems on monthly basis.

The apex level SOH&E Policy has been further drilled down through separate SOH&E Policies for each of its Businesses and Plants. The revised SOH&E Policy is displayed at prominent locations at all Offices and Plants of your Company and communicated to all its stakeholders.

Objectives and targets from the new revised SOH&E Policy are supported by focused integrated management programs such as i4 safety, safety rounds, kaizens and mistake proofing projects. Your Company demonstrates a strong leadership commitment towards SHO&E, and as a part of the same, multiple measures and actions are implemented with thorough competency training programs like Working on height, Welding and Gas cutting, working on LPG/PNG/CNG and Forklift driving.

At each Plant location, annual events were organised and commemorated like National Safety Day/Week, World Environment Day, Road Safety Week and Fire Service Week. Safety Culture building was demonstrated through Behaviour Based Safety (BBS), Safety Crusade, Levers of Excellence and Waste to Wealth programs in the manufacturing domain. SOH&E awareness training programs were conducted for all stakeholders as per the training calendar through various e-learning modules. In the year under review, your Company initiated an Accelerated Learning Program (ALP) on Safety, for all group employees to further strengthen innovations in safety and best practices related to SOH&E.

Your Company carried out Statutory safety risk assessments, quantitative risk analysis, electrical safety audits of all facilities absorbing new amended legal requirements. For the year under review, your Company initiated a Fire load reduction program at the Plant level.

Your Company’s Plants and locations continued their commitment to improve the wellbeing of employees and contract workmen by organising physical fitness activities like yoga, zumba, occupational health examination camps, medical check-ups, consultation and counselling. Further, all locations observed World Health Day, World Heart Day, World Kidney Day and World Diabetes Day along with Way2Wellness sessions covering topics like Healthy Heart, Diabetes, etc.

Various path breaking projects were implemented by your Company in the areas of Air Pollution Management, Water and Waste Water Management, Solid Waste Management and new techniques to propagate ‘Go Green’ philosophy were undertaken. These Projects cover elimination/ minimisation of environment impact, in line with current and future environmental challenges, prevention of injury, ill health and OHS Hazards, at the first place of their control.

Your Company extended the ‘Go Green’ initiatives to its supplier community through Green Supply Chain Management practices. Your Company also proactively shared good safety practices with business partners. ‘Business Case for Safety’ a book published in association with the National Safety Council and CII, was shared with all suppliers.

Through stakeholder engagement, your Company monitors sustainability development initiatives, which include climate change mitigation, sustainable source use, protection of bio-diversity and certified green building projects with platinum and gold rated facilities at identified locations and reported as per the Global Reporting Initiative (GRI) - G4 Guidelines.

World Environment Day, World Earth Day, World Water Day and Energy Conservation Week and Water Conservation Week are also observed on an annual basis.

Certifications/Recertifications

All Plants of your Company have been recertified under the standard ISO 14001: 2004 and OHSAS 18001: 2007. Further, all Plants are in the process of adopting the revised environmental standard ISO 14001: 2015.

All targets under SOH&E are reviewed on a periodic basis through operations reviews conducted by Senior Management. The focused initiatives and reviews have helped improve SOH&E performance of your Company by over 50% in the period 2016-17.

K. BOARD & COMMITTEES

Directors

Pursuant to the recommendation of Governance, Nomination and Remuneration Committee, the Board at its Meeting held on 11th November, 2016 designated and appointed Mr. Anand G Mahindra, who was holding the position of Chairman and Managing Director, as Executive Chairman of the Company for a period of five years with effect from 12th November, 2016 upto and including 11th November, 2021 and appointed Dr. Pawan Goenka who was holding the position of Executive Director and Group President (Auto & Farm Sector), as Managing Director of the Company for a period of four years from 12th November, 2016 upto and including 11th November, 2020, subject to approval of the Members of the Company at the ensuing Annual General Meeting (“AGM”).

The Board of Directors at the same Meeting based on the recommendation of the Governance, Nomination and Remuneration Committee appointed Mr. T. N. Manoharan as an Additional Director (Independent and Non-Executive) of the Company for a period of 5 consecutive years commencing from 11th November, 2016 to 10th November, 2021 subject to the approval of the Members in the ensuing Annual General Meeting.

Dr. Pawan Goenka retires by rotation and, being eligible, offers himself for re-appointment at the 71st Annual General Meeting of the Company scheduled to be held on 4th August, 2017.

Mr. Deepak S. Parekh would cease to hold office as an Independent Director of the Company from 8th August, 2017, upon completion of his tenure as approved by the Shareholders at the 68th AGM of the Company.

Mr. Parekh was appointed as a Director on the Board of the Company with effect from 29th August, 1990. He has made significant contributions towards effective functioning of the Board and has been acting as the Chairman of the Audit Committee and Member of the Strategic Investment Committee and Risk Management Committee of the Company.

The Board has placed on record its sincere and deep appreciation of the invaluable counsel and contribution made by Mr. Parekh to the Company. The 27 years that Mr. Parekh was on the Board of the Company were very eventful and critical years in the Company’s history.

Mr. Parekh’s immense knowledge, financial acumen and expertise helped the Board and the Company negotiate in these challenging times while at the same time adhering strictly to sound financial discipline with the highest standards of Corporate Governance.

Quote from Chairman Emeritus

“An Audit Committee of the Board was established as early as 1987 long before it was mandated by law. Deepak Parekh was inducted as a Member of the Audit Committee in August, 1992 and elected Chairman in May, 2000.

With his vast knowledge and experience of the Corporate World, he set about establishing norms and practices of conducting business with the highest standards of ethical governance. He guided the affairs of the Company towards achieving high standards of ethics and total transparency in all issues.

His contribution to the affairs of the Company as well as on matters of strategy and governance has been immense and I would like to take this opportunity to put on record my deep appreciation of the guidance and friendship with which he conducted his Chairmanship. I wish him many years of happiness and good health and he will surely be missed.”

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 SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Pursuant to the provisions of the Companies Act, 2013 and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has carried out an annual evaluation of its own performance and that of its Committees as well as performance of the Directors individually. 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.

A separate exercise was carried out by the Governance, Nomination and Remuneration Committee 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 Company was also carried out by the Independent Directors, taking into account the views of the Executive Director and Non-Executive Director. The Directors expressed their satisfaction with the evaluation process.

The details of programs for familiarisation of the Independent Directors with the Company, their roles, rights, responsibilities in the Company, nature of the industry in which the Company operates, business model of the Company, number of programs and number of hours spent by each Independent Director in terms of the requirements of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 are available on the Company’s website and can be accessed at the Web-link: http://www.mahindra.com/resources/investor-reports/FY17/ Annual Reports/Links-AnnualReport.zip

In line with the principles of transparency and consistency, 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.

The Policies mentioned at (a) and (b) above are attached as Annexure V-A and V-B respectively and form part of this Report.

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 31st March, 2017, 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 31st March, 2017 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 31st March, 2017;

(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 31st March, 2017.

Board Meetings and Annual General Meeting

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

During the year 1st April, 2016 to 31st March, 2017, six Board Meetings were held on: 30th May, 2016, 10th August, 2016, 11th November, 2016, 3rd December, 2016, 10th February, 2017 and 28th March, 2017. The 70th Annual General Meeting (AGM) of the Company was held on 10th August, 2016.

Meetings of Independent Directors

The Independent Directors of your Company meet before the Board Meetings without the presence of the Executive Chairman or the Managing 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 Executive Chairman of the Company (taking into account the views of the Executive and Non Executive Directors), review the performance of the Company, 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 five Directors viz. Mr. Deepak S. Parekh (Chairman of the Committee), Mr. Nadir B. Godrej, Mr. M. M. Murugappan, Mr. R. K. Kulkarni and Mr. T. N. Manoharan. 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.

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

L. GOVERNANCE 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. 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 SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 forms part of the Annual Report.

Vigil Mechanism

The Vigil Mechanism as envisaged in the Companies Act, 2013, the Rules prescribed thereunder and the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 is implemented through the Company’s Whistle Blower Policy to enable the Directors, employees and all stakeholders of the Company to report genuine concerns, to provide for adequate safeguards against victimisation of persons who use such mechanism and make provision for direct access to the Chairman of the Audit Committee.

Whistle Blower Policy of your Company is available on the Company’s website and can be accessed at the Web-link: http://www.mahindra.com/resources/investor-reports/FY17/Annual Reports/Links-AnnualReport.zip

Further details are available in the Report on Corporate Governance that forms part of this Annual Report.

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

The Company has in place an Anti-Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment.

All employees (permanent, contractual, temporary, trainees) are covered under this Policy. The Policy is gender neutral.

During the year under review, 4 complaints with allegations of sexual harassment were filed, of which 3 were disposed-off as per the provisions of The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and as of 31st March, 2017, 1 complaint is pending.

Business Responsibility Report

The ‘Business Responsibility Report’ (BRR) of your Company for the year 2016-17 forms part of this Annual Report as required under Regulation 34(2)(f) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

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 Organisational structure for managing and reporting on risks.

Your Company has constituted a Risk Management Committee of the Board which is authorised to monitor and review risk management plan and risk certificate. The Committee is also empowered, inter alia, to review and recommend to the Board the 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 comprises review of risks and Risk Management Policy on 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 therein of elements of risk, including 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 organisation.

M. CORPORATE SOCIAL RESPONSIBILITY AND RELATED MATTERS

Corporate Social Responsibility (CSR)

Your Company’s Corporate Social Responsibility efforts continue to be directed towards supporting the constituencies of girls, youth and farmers by innovatively supporting them through programs in the domains of education, health and environment, while harnessing the power of technology. It is only through these sustained and continued efforts that your Company can build and consolidate its CSR initiatives which contribute to nation building.

During the last Financial Year, your Company has been making an impact through its ongoing CSR programs, some of the notable ones include Project Nanhi Kali, which supports the education of underprivileged girls, Mahindra Pride Schools, which provide livelihood training to youth from socially and economically disadvantaged communities and a variety of other scholarship programs, which range from providing opportunities to youth from low income group families to undergo diploma courses at vocational education institutes, to allowing meritorious students to pursue their post graduate studies at reputed universities overseas, to allowing meritorious and deserving students to study at the Mahindra United World College in Pune. Your Company has also helped set up a premier engineering institution ‘Mahindra Ecole Centrale’ (MEC) in Hyderabad, in partnership with Ecole Centrale, Paris and the Jawaharlal Nehru Technological University, Hyderabad. In the area of public health, your Company sponsored Lifeline Express, through which medical care and treatment was provided to communities who do not have access to any medical facilities. Further, your Company supported critical patients suffering from cancer and other life threatening illnesses. Your Company also contributed to the environment by adding green cover through planting of over two million trees this year through Project Hariyali. Your Company continues to support small and marginal farmers by training them in effective farming practices including soil health, crop planning, creating model farms with bio-dynamic farming practices, with a view to increasing crop productivity, through the Wardha Farmer Family Project, Krishi Mitra Project and Integrated Watershed Development Project. Your Company also partnered with the Maharashtra State Government to support the Village Social Transformation Mission of the Government. Your Company created a ‘Zero Fatality Corridor’ to ensure ‘zero’ deaths due to accidents on Mumbai Pune Expressway. In addition to the above CSR initiatives, your Company has a vibrant Employee Social Options platform through which the employees are provided opportunities to give back to the community.

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 can be accessed at the Company’s website through the Web-link: http://www.mahindra.com/resources/investor-reports/FY17/Annual Reports/Links-AnnualReport.zip

CSR Committee

The CSR Committee comprises of Dr. Vishakha N. Desai (Chairperson), Mr. Anand G. Mahindra, Mr. R. K. Kulkarni, Dr. Pawan Goenka and Mr. Vikram Singh Mehta. The Committee, inter alia, monitors the CSR activities.

During the year under review, your Company spent Rs. 83.57 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. 83.30 crores. The detailed Annual Report on the CSR activities undertaken by your Company in Financial Year 2017, is annexed herewith marked as Annexure VI.

Sustainability Initiatives

During the year under review, the 9th Sustainability Report for the year 2015-16 was released. This year’s Report was externally assured by KPMG and conforms to the fourth generation ‘GRI G4-Core option’.

Your Company maintained the focus on the Environmental, Social and Governance (ESG) parameters, on its journey from “Conservation to Rejuvenation” in the year under review by building on the initiatives of the previous years as also initiating new ones. Your Company continued the bio-diversity assessments across selected locations to further the actions on the India Business and Bio-diversity Initiative (IBBI).

Mr. Anand G. Mahindra, Executive Chairman of your Company represented the Corporate World at the historic Paris Climate Change Agreement Signing ceremony in the United Nations headquarters, New York.

Your Company is the first Indian Company to announce its internal Carbon Price of US $10 per ton of carbon emitted. Carbon Pricing is an internationally recognised business tool that enables companies to create resources which are invested in low carbon technologies, which help reduce future emissions and lower operating costs. An international webinar featuring Dr. Pawan Goenka, Managing Director was held in the reporting year in collaboration with Yale University and World Bank led Carbon Pricing Leadership Coalition.

The Sustainability performance for your Company for the Financial Year 2016-17 will be elaborated in detail in the GRI Report which is under preparation and will be ready for release shortly.

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

- Winning ‘Leadership in Sustainability Strategy’ at Parivartan Sustainability Leadership Awards 2016.

- Winning the second prize for the Sustainability Report at the Indian Chamber of Commerce Awards 2016.

- Winning ‘Manufacturing Innovator for the year’ at TIME India Awards 2017.

- Winning the prestigious Cll - ITC Sustainability Award 2016 in CSR category as ‘Commendation for significant achievement’.

- Winning Cll National Award 2016 for ‘Excellence in Water Management’ (for Nashik Plant).

- Winning ‘Global Sustainability Award 2016 - Platinum Rating’ at World Renewable Energy Congress, 2016 organised by Energy and Environment Foundation (for Igatpuri Plant).

- Retaining the status of getting listed on the Dow Jones Sustainability Index - 2016 under the ‘Emerging Market Index’ for the consecutive third year with improvement in percentile scores.

- Retaining its position in the top 10 in the India 200 Carbon Disclosure Leadership Index 2016.

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 furnished in Annexure VII and is attached to this Report.

N. SECRETARIAL

Share Capital

The issued, subscribed and paid-up Share Capital of the Company stood at Rs. 310.55 crores as at 31st March, 2017 comprising of 62,10,92,384 Ordinary (Equity) Shares of Rs. 5 each fully paid-up. There was no change in Share Capital during the year under review.

Extract of 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, an extract of the Annual Return as on 31st March, 2017 in Form No. MGT-9 is attached herewith as Annexure VIII and forms part of this Report.

GENERAL

The Executive Chairman of the Company did not receive any remuneration or commission from any of the subsidiary of your Company. The Managing Director of the Company did not receive any commission from any of its subsidiaries and has not exercised ESOPs of subsidiaries of the Company during the year, which were granted in the earlier year(s).

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 except as stated hereunder:

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 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.

The Honourable Supreme Court on 29th March, 2017, passed Orders that on and from 1st April, 2017, non BS-IV compliant vehicles would not be permitted to be sold in India by any manufacturer or dealer and prohibited vehicle registration authorities from registering such vehicles. The Financial Statements have recognised an impact of Rs. 171.01 crores arising from the above.

The said Order of the Honourable Supreme Court will not impact the going concern status of the Company.

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).

For and on behalf of the Board

ANAND G. MAHINDRA

Executive Chairman

Mumbai, 30th May, 2017


Mar 31, 2016

The Directors present their Twenty-Ninth Annual Report together with the audited accounts of your Company for the year ended March 31, 2016.

FINANCIAL RESULTS (STANDALONE)

(Rs. in Million)

For the year ended March 31 2016 2015

Income 220,782 192,872

Profit before Interest, Depreciation, exceptional items and tax 45,221 33,903

Interest (533) (479)

Depreciation (5,455) (4,733)

Profit before exceptional items and tax 39,233 28,692

Exceptional items - 613

Profit Before Tax 39,233 29,305

Provision for taxation (7,033) (6,743)

Profit after tax 32,200 22,562

Balance brought forward from previous year 63,55 943,856

Adjustments on account of Amalgamation 2,010 1,140

Profit available for appropriation 97,769 67,558

Transfer from Debenture Redemption Reserve - 2,972

Final Dividend Including tax* (7) (33)

Reversal of Provision for Tax on Dividend 1,137 -

Dividend (Proposed) (11,614) (5,765)

Tax on dividend (2,364) (1,173)

Transfer from General Reserve 7,732 -

Balance carried forward 92,653 63,559

* In respect of equity shares issued pursuant to exercise of Stock Options after March 31, 2015 but before book closure period, the Company paid dividend of Rs. 5.5 Million for the year 2014-15 and tax on dividend thereto of Rs. 1.1 Million as approved by the shareholders at the Annual General Meeting held on July 28, 2015.

DIVIDEND

Your Directors are pleased to recommend a dividend of Rs. 12/- per Equity Share (240%), payable to those Shareholders whose names appear in the Register of Members as on the Book Closure Date. The dividend includes an additional special dividend of Rs. 6/- per share to commemorate the 10th year of Company''s listing on the stock exchanges.

SHARE CAPITAL

During the year under review, your Company allotted 7,021,157 equity shares on the exercise of stock options under various Employee Stock Option Plans. Consequently the issued, subscribed and paid-up equity share capital has increased from Rs. 4,803.94 Million divided into 960,788,912 equity shares of Rs. SI- each to Rs. 4,839.05 Million divided into 967,810,069 equity shares of t SI- each.

BUSINESS PERFORMANCE / FINANCIAL OVERVIEW

The Company offers a bouquet of services which includes Telecom IT & Network Services, Consulting, Application Outsourcing, Infrastructure Outsourcing, Engineering Services, BPO, Platform Solutions and Mobile Value Added products and Services. With an impeccable track record of delivery and strong alliances with leading technology and product vendors, the Company serves more than 800 customers, including several of the Fortune 500 Companies.

In the fiscal year 2015-16 the Company''s consolidated revenues increased to Rs. 264,942 Million from Rs. 226,213 Million in the previous year, a growth of 17.1%. The geographic split of revenue was balanced with 47% share of Americas, 29% share of Europe and 24% from Rest of the World.

The consolidated Profit before Interest, Depreciation, Tax and Exceptional Items was at Rs. 48,750 Million, against Rs. 42,987 Million in the previous year. The consolidated Profit After Tax, amounted to Rs. 31,180 Million as against Rs. 26,277 Million in the previous year. The number of customers increased from 767 in the previous year to 807 at the end of fiscal year 2015-16.

In emerging areas of Big Data, Mobility, Network, Cloud, Security, Platforms and Engineering Services, Tech Mahindra is well placed with its breadth of service offerings. Your company has also progressed well in building intellectual property through various Products & Services and Platforms. Your Company is committed towards building a synergistic relationship with its partners to enable, deliver, complete and customized solutions to customers. Tech Mahindra developed an integrated program ''BROP''(Building Relationships and Opportunities and Projects) program, which helps partner organizations and customers to succeed.

There are no material changes or commitments affecting the financial position of the Company between the end of the financial year and to the date of the report.

In summary, Tech Mahindra is well positioned in the markets it serves with a broad range of service offerings and a diversified customer base.

MERGER

During the year under review two wholly owned subsidiaries of the Company viz., Tech Mahindra BPO Limited and New vC Services Private Limited got amalgamated with the Company pursuant to the Scheme of Amalgamation (the "Scheme") sanctioned by the Honorable High Court of Bombay vide its order dated March 4, 2016. The Scheme came into effect on March 29, 2016, upon fling of the court order with the Registrar of Companies, Mumbai and pursuant thereto the entire business and all the assets and liabilities, duties, taxes and obligations of both the transferor companies have been transferred to and vested in the Company from the appointed date i.e., April 1, 2015.

During the year under review, Mahindra Engineering GmbH, a wholly owned subsidiary of the Company, got amalgamated with Tech Mahindra GmbH another wholly owned subsidiary of your Company in Germany.

ACQUISITIONS

During the year, your Company and Mahindra & Mahindra Limited (M&M), have jointly entered into an agreement with Pincar S.r.l., to purchase a controlling stake in Pininfarina S.p.A., an iconic 85 year old legendary Italian styling brand associated among others with Ferrari, Alfa Romeo and Peugeot. The acquisition will complement existing engineering capability of the Company with High-end styling and Engineering Services. As part of the agreement, Tech Mahindra and M&M shall purchase 76.06% of Pininfarina shares from the current controlling shareholder Pincar S.r.l. at a price of Euro 1.1 per share through a Special Purpose Vehicle (SPV), the ownership of which will be with your Company and M&M in the ratio of 60:40. The SPV would also make an open offer to the public shareholders of Pininfarina for the balance 23.94% stake at the same price. The SPV will infuse further funds into Pininfarina by way of Rights issue. Pininfarina will continue to remain an independent Company, listed on the Milan Stock Exchange, with Mr. Paolo Pininfarina continuing as the Chairman of its board.

DETAILS OF SUBSIDIARY / JOINT VENTURES / ASSOCIATE COMPANIES

As on March 31, 2016, your Company has 148 subsidiaries which includes 109 step-down subsidiaries and 4 Associate Companies. There has not been any material change in the nature of the business of the subsidiaries. As required under the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, and the Companies Act, 2013, the Consolidated Financial Statements of your Company and all its subsidiaries are provided in this Annual Report. The Consolidated Financial Statements have been prepared in accordance with Accounting Standards AS 21, AS 23 and AS 27 issued by The Institute of Chartered Accountants of India and shown the financial resources, assets, liabilities, income, profits and other details of your Company and its subsidiaries and its share in Associate Company as a single entity, after elimination of minority interest.

The performance and financial position of subsidiaries, associate companies and joint venture companies included in the Consolidated Financial Statement is provided in accordance with the provisions of Section 129 read with Rule 5 of the Companies (Accounts) Rules, 2014 as a separate statement annexed to the Notes on Accounts containing the salient features of the financial statement of Company''s subsidiaries/joint ventures or associate companies in Form AOC – 1.

Pursuant to Rule 8 (5) (iv) of the Companies (Accounts) Rules, 2014, the names of the companies which have become or ceased to be the subsidiaries, joint ventures or associate companies during the year are provided in "Annexure I" to this report.

The policy for determining Material Subsidiaries formulated by the Board of Directors is disclosed on the Company''s website and is accessible on http://www. techmahindra.com/investors/corporate_governance.aspx

HUMAN RESOURCES

Your Company believes that while Technology can enable processes but it is People who actually make things happen. In a journey of delivering tangible business value to stakeholders, Associates are envisioned as a strategic differentiator for the Company. Tech Mahindra''s Employee Value Proposition - Freedom to Explore: Connect, Co-Create and Celebrate – is at the core of its people practices and policies.

Tech Mahindra nurtures globally competitive professionals through robust training programs enabling continuous learning for the Associates. The Company also enables young achievers to demonstrate their leadership skills and strategic thought process through focused early leadership programs like Young CEO, 1000 Leaders, Shadow Board, Global Leadership Cadre (GLC) and Achievers in the Making (AIM). As a refection on the sustained efforts and initiatives undertaken by the learning and career development teams, your Company was ranked No.14 globally at the Training Top 1251 awards – the top rank among all IT organizations worldwide and all Indian organizations across sectors.

Your Company promotes an empowered and collaborative work environment where leaders stay engaged with the Associates and encourage them to challenge conventional thinking. Through the Intrapreneurship Program, Associates have the opportunity to pursue their business ideas and commercialize them with support from mentors and resources from your Company. Your Company also has a comprehensive reward program that appreciates individuals and teams at the unit, functional and organizational levels. Your Company''s Knowledge Management program is one of the best in the 1 Training Top 125 is a premier US based learning industry award. Award winners are organizations with the most successful learning and development programs in the world.

industry and the Company was conferred with the ASIAN Knowledge Management MAKE (Most Admired Knowledge Enterprise) Award in 2015. Similarly, the social Intranet portal, MyBeatPlus, fosters connecting, co-creating and celebrating within the organization, and was awarded the "Best Marketing Idea Award" at The Great Indian IT Marketing Summit.

Your Company is committed to providing a holistic employment experience to Associates with the flexibility to balance both professional and personal commitments. The comprehensive Wealth of Wellness (WoW) offerings enhance physical, mental, emotional and spiritual wellbeing of the Associates. The Company was ranked 2nd in the country for Wellness practices at Chestnut Global Partner''s Employee Health and Wellness Ranking 2015. There is a significant focus on creating a fun-filled, high energy work environment where personal milestones, organizational successes and special occasions are celebrated with fervour and enthusiasm involving not just Associates but also their families.

During the year under review, Tech Mahindra''s people practices, policies and programs have been awarded in various external forums representing members from not just the Information Technology industry but the entire spectrum of the corporate world.

Tech Mahindra won 4 Awards at the Society for Human Resources Management (SHRM) India Annual Awards 2015:

- Winner of Excellence in Social Media People Practices

- Winner of Excellence in Developing Leaders of Tomorrow

- Winner of Excellence in Community Impact

- Runners Up in Employee Health and Wellness Practices

Tech Mahindra was also recognized as one amongst the Top 3 in the country for its People Practices at the Business World HR Excellence Awards 2015 apart from being awarded the Change Champion Award.

These awards and recognitions have positioned Tech Mahindra as an organization that puts people first, delivers future focused excellence in the field of People Management and recognizes the importance of human capital as a key driver of business growth.

QUALITY

Your Company continues its focus on quality and strives to exceed customer expectations at all times. It is certified under various standards to meet client demands and enhance value delivery - Successfully assessed at CMMI Dev & SVC V1.3 L5, TMMi L5, TL9K, ISO 9001:2008, ISO 20000:2011, ISO 27001: 2013, ISO 13485, Auto Spice, AS9100:2009 (Standard for Aerospace domain – scope of certification limited to the aerospace business within Tech Mahindra). In addition to these, your Company also maintains its commitment to health, safety and environment by continually improving its processes in accordance with ISO 14001 and OHSAS 18001 standards.

Your Company is also certified on ISO 22301:2012 (Societal Security) and has a comprehensive Business Continuity and Disaster Recovery framework, to prevent potential business disruptions in the event of any disaster. It has processes that will help resume services to customers ''acceptable service levels. Automated Service Desk with SLAs for enabling business and Vulnerability Assessment and Penetration Testing Lab for secured corporate network operations are highlights showcasing information security posture of the Organization.

Tech Mahindra (IT Division) has emerged as the ''organization with highest maturity of business excellence practices ''at Mahindra Group (Services Sector). It has been assessed at TMW Maturity Stage 6 (on scale of 1-10 stages) of Mahindra Business Excellence Framework – The Mahindra Way.

These certifications are testimony of the robustness of business processes and at large the quality culture imbibed in the organization.

Your Company has also introduced Practices for transforming Quality Assurance processes to Delivery Assurance processes with focus on Product Assurance and Architecture Assurance; these are measured and monitored through various indices. One such initiative is "Execution Excellence Index" focusing on achieving high project maturity, improved tools usage and standardization, knowledge management and performance on key business metrics, in order to strengthen further the Business Excellence in what we deliver to the customers, thereby achieve better Customer satisfaction. Your Company is putting all the initiatives in place in order to ensure we deliver as stated in Quality Policy.

DIRECTORS

During the year under review, Mr. Vineet Nayyar Executive Vice Chairman of the Company retired on August 09, 2015 and the Board thought it appropriate that the Company should continue to avail the benefit of Mr. Nayyar''s vast experience and expertise. Accordingly, your Board of Directors approved the recommendation of the Nomination and Remuneration Committee of the Board (the Committee) and appointed Mr. Vineet Nayyar as an Additional Director and designated him as Vice Chairman of the Company with effect from August 10, 2015. Mr. Nayyar has been associated with the Company for more than a decade - initially as Managing Director and subsequently as Executive Vice Chairman. Mr. Nayyar has contributed immensely to the growth of the Company and has been instrumental in bringing the Company to its current status.

Further, the Board considered the recommendation of the Committee and appointed Mr. V. S. Parthasarathy, who is the Group CFO & Group CIO of Mahindra & Mahindra Ltd. and member of the Group Executive Board, as an Additional Director with effect from August 10, 2015.

The approval of the Members is sought for appointment of Mr. Vineet Nayyar (DIN: 00018243) and Mr. V. S. Parthasarathy (DIN: 00125299) as Directors of the Company, liable to retire by rotation.

All Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149 (6) of the Companies Act, 2013 and Regulation 16 (1) (b) of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Pursuant to the provisions of Section 152 (6) (c) of the Companies Act, 2013, Mr. C. P. Gurnani, Director (DIN: 00018234) is liable to retire by rotation and offers himself for reappointment.

Board evaluation

Pursuant to the provisions of the Companies Act, 2013, the Board has devised a policy on evaluation of performance of Board of Directors, Committees and Individual directors. This policy is also in compliance to Regulation 19 read with Schedule II, Part D of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. Accordingly, the Chairman of the Nomination and Remuneration Committee obtained from all the board members duly filled in evaluation forms for evaluation of the Board as a whole, evaluation of the Committees and peer evaluation. The summary of the evaluation reports were presented to the respective Committees and the Board for their consideration.

policy on Directors Appointment and Remuneration

The Governance policies laid down by the Board of directors of your Company include:

i. Policy on appointment and removal of Directors, Key Managerial Personnel and Senior Management

ii. Policy on remuneration to the Directors, Key Management Personnel, Senior Management and other Employees

The extract of these two policies are provided in "Annexure II".

training

The Company has laid down a policy on training for Independent Directors, as part of the governance policies. The directors are updated on the regulatory changes, Business strategy and operations by the senior leadership of the Company periodically.

Key Managerial personnel (KMps)

Pursuant to the provisions of Section 203 of the Companies Act, 2013, Mr. C. P. Gurnani, Managing Director & Chief Executive Officer, Mr. Milind Kulkarni, Chief Financial Officer and Mr. G. Jayaraman, Company Secretary & Chief Compliance Officer are the Key Managerial Personnel of the Company.

During the year under review, Mr. Vineet Nayyar ceased to be Key Managerial Personnel of the Company with effect from August 10, 2015 consequent to his retirement from the position of Executive Vice Chairman.

DIRECTORS''RESPONSIBILITY STATEMENT

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

i. in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

ii. they have, in the selection of the accounting policies, consulted the Statutory Auditors and these have been applied consistently and, reasonable and prudent judgments and estimates have been made so as to give a true and fair view of the state of affairs of the Company as at March 31, 2016 and of the profit of the Company for the year ended on that date;

iii. proper and sufficient care had been taken 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 other irregularities;

iv. the annual accounts have been prepared on a going concern basis;

v. they had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively;

vi. the proper systems to ensure compliance with the provisions of all applicable laws are in place and are adequate and operating effectively.

DETAILS IN RESPECT OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS

The Company has internal financial controls which are adequate and were operating effectively. The controls are adequate for ensuring the orderly & efficient conduct of the business, including adherence to the Company''s policies, the safe guarding of assets, the prevention & detection of frauds & errors, the accuracy & completeness of accounting records and timely preparation of reliable financial information.

STATUTORY AUDITORS

M/s. Deloitte Haskins & Sells LLP, Chartered Accountants, [Firm''s Registration No. 117366W/W-100018] the Auditors of your Company, hold office upto the conclusion of the forthcoming Annual General Meeting (AGM) of the Company. Pursuant to provisions of Section 139(2) of Companies Act, 2013 read with Companies (Audit and Auditors) Rules, 2014, M/s. Deloitte Haskins & Sells LLP are eligible for appointment as Auditors. Your Company has received a written confirmation from M/s. Deloitte Haskins & Sells LLP, Chartered Accountants to the effect that their appointment, if made, would satisfy the criteria provided in Section 141 of the Companies Act, 2013 for their appointment. The Board recommends the appointment of M/s. Deloitte Haskins & Sells LLP, Chartered Accountants as the Auditors of the Company from the conclusion of the ensuing AGM to the conclusion of the next AGM. There are no qualifications, reservation or adverse remark or disclaimer made in the audit report for the Financial Year 2015-16.

SECRETARIAL AUDIT REPORT

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 had appointed Dr. K. R. Chandratre, Practicing Company Secretary, Pune to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is provided as "Annexure III". There are no qualifications, reservation or adverse remark or disclaimer made in the Secretarial Audit Report.

EXTRACT OF THE ANNUAL RETURN

Pursuant to the provisions of Section 134 (3) (a) of the Companies Act, 2013, the extract of the Annual Return in Form MGT-9 is attached as "Annexure IV".

MANAGERIAL REMUNERATION

Disclosures of the ratio of the remuneration of each director to the median employee''s remuneration and other details as required pursuant to 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 provided as "Annexure V".

None of the directors or Managing Director of the Company, received any remuneration or commission from Subsidiary Companies of your Company.

The details of remuneration paid to the Directors including Executive Directors of the Company are given in Form MGT-9 forming part of the Directors Report.

PARTICULARS OF EMPLOYEES

The information required under Section 197(12) of the Companies Act, 2013 ("the Act") read with Rule 5(2) & (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms part of this Report. However, pursuant to first proviso to Section 136(1) of the Act, this Report is being sent to the Shareholders excluding the aforesaid information. Any shareholder interested in obtaining said information, may write to the Company Secretary at the Registered Office / Corporate Office of the Company and the said information is available for inspection at the Registered Office of the Company.

Anti-Sexual Harassment policy

Your Company laid down Anti Sexual Harassment policy and it is made available on the website of the Company. The Company has zero tolerance on Sexual Harassment at workplace. During the year under review, there were no cases fled pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

EMPLOYEE STOCK OPTION PLANS

During the year under review, there were no material changes in the Employee Stock Option Plans (ESOPs) of the Company and the Schemes are in compliance with the SEBI Regulations on ESOPs. As per Regulation 14 of SEBI (Share Based Employee Benefits) Regulations, 2014 read with SEBI circular dated June 16, 2015 the details of the ESOPs are uploaded on the Company''s website http://www.techmahindra.com/sites/ResourceCenter/ brochures/investors/corporategovernance/Details-of- ESOPs.pdf.

CORPORATE GOVERNANCE

A report on Corporate Governance covering amongst others, composition, details of meetings of the Board and Committees along with a certificate for compliance with the conditions of Corporate Governance issued by the Statutory Auditors of the Company, in accordance with the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, forms part of this Annual Report.

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.

RISK MANAGEMENT

The Risk Management Committee of the Board of Directors periodically reviews the Risk Management framework, identified risks with criticality and mitigation plan. The elements of risk as identified for the Company with impact and mitigation strategy are set out in the Management Discussion and Analysis Report.

ESTABLISHMENT OF VIGIL MECHANISM

Your Company has laid down Whistle Blower Policy covering Vigil Mechanism with protective Clauses for the Whistle Blowers. The Whistle Blower Policy is made available on the website of the Company.

DEPOSITS / LOANS & ADVANCES, GUARANTEES OR INVESTMENTS

Your Company has not accepted any deposits from the public during the year under review. The particulars of loans/advances, guarantees and investments under Section 186 of the Companies Act, 2013 are given in the notes forming part of the Financial Statements.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All transactions entered into with Related Parties as defined under Section 2(76) of the Companies Act, 2013 and Regulation 23 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, during the financial year were in the ordinary course of business and are at an arm''s length basis and do not attract the provisions of Section 188 of the Companies Act, 2013. There were no materially significant transactions with related parties in the financial year which were in conflict with the interest of the Company and requiring compliance of the provisions of revised Regulation 23 of the Listing Regulations. Suitable disclosure as required by the Accounting Standards (AS18) has been made in the notes forming part of the Financial Statements.

The Company has formulated a policy on materiality of Related Party Transactions and dealing with Related Party Transactions which has been uploaded on the Company''s website http://www.techmahindra. com/sites/Resource Center/Brocheres/investors/ corporate governance/RPTPolicyAmended.pdf.

The particulars of Related Party Transactions in prescribed Form AOC - 2 are attached as "Annexure VI".

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars as prescribed under Section 134 (3) (m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 are provided in "Annexure VII" which forms part of this report.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

The CSR vision of your Company is "Empowerment through Education."

In compliance with the guidelines prescribed under Section 135 of the Companies Act, 2013, your

Company constituted a Corporate Social Responsibility (CSR) Committee. Your Board of Directors laid down the CSR Policy, covering the Objectives, Focus Areas, Governance Structure and Monitoring & Reporting Framework among others. The policy is available at http://www.techmahindra.com/society/default.aspx.

Your Company''s social initiatives are carried out by Tech Mahindra Foundation and Mahindra Educational Institutions.

TECH MAHINDRA FOUNDATION (TMF)

The Tech Mahindra Foundation, the CSR arm of the Company, established in 2007 as a Section 25 Company of erstwhile Companies Act, 1956, works towards a stated mission:

"Educated, skilled and able women and men are a country''s true strength".

During the year under review, Tech Mahindra Foundation conducted 160 high-impact projects with 90 partners, reaching out to 150,000 children and youth across these locations.

School education

The Foundation''s work in school education focuses upon three thematic areas: school improvement, teacher empowerment and learning enrichment. The key initiatives include:

All Round Improvement in School education (ARISE):

Tech Mahindra Foundation''s educational initiatives under ARISE are long-term school improvement programmes, run in partnership with local governments and partner organisations. The Foundation has adopted 60 schools across India and is working with 18 partners to turn them around completely into model schools of excellence. ARISE initiatives encompass educational empowerment programmes for children with disabilities.

Shikshaantar:

Shikshaantar, envisioned as a programme for enhancing capacity of government school teachers, has taken rapid strides during the year. TMF has been working with the East Delhi Municipal Corporation to manage its In-Service Teacher Education Institute (ITEI), where teachers from nearly 400 primary schools receive quality training on a regular basis.

Shiksha Samvardhan:

Shiksha Samvardhan, or the education enrichment programme, is a thematic intervention around learning enhancement initiatives of the Foundation, towards making learning interesting, child-centred and activity-based to reduce cumulative burden of non-comprehension and to promote grade appropriate competencies.

employability:

Skills for Market Training (SMART) is the Foundation''s fagship programme in employability. It is built on the vision of an educated, enlightened and employed India, and a belief that educated and skilled youth are the country''s true strength. The programme started with 3 Centres in 2012 and is currently running 65 Centres at 10 locations across India. These include SMART Centres, SMART Centres (training for people with disabilities), SMART-T Centres (training in technical trades) and the first SMART Academy for Healthcare in Delhi. The Academy will closely engage with the industry stalwarts for constant curriculum upgradation and placement.

During the year under review, your Company trained ~16,000 young women and men under its SMART programme. More than 75-80% of the graduates are placed in jobs upon successful completion of the training, across multiple industries.

MAHINDRA EDUCATIONAL INSTITUTIONS (MEI)

technical education

Your Company''s initiatives in technical education are carried out through Mahindra Educational Institutions (MEI), under which the Institution has extended infrastructural and operational support to Mahindra Ecole Centrale, a state of-the-art technical institution in Hyderabad. The institution offers a four-year B.Tech Programme in association with Ecole Centrale, Paris under an industry academia memorandum of understanding with Jawaharlal Nehru Technological University, Hyderabad.

The institution''s vision is to train engineers to be entrepreneurial and innovative as well as technically trained, so that they are capable of meeting the greatest challenges of the era. It is aligned to MEI''s work for the cause of promoting quality higher education by establishing institutions of higher learning, encourage education and research work in different disciplines and to promote innovation and technology development.

The Annual Report on CSR activities is provided as "Annexure VIII".

SUSTAINABILITY

Your company believes that responsible business can be possible only when aligned to sustainable development. Thus the Company concentrated its efforts on leveraging Sustainability as a core aspect when implementing strategies across all dimensions- social, economic and environmental. The focus on next generation solutions, attracting and retaining the right talent and identifying the environmental goals ensure that company adheres to a business strategy that impacts positively and creates a sustainable value for all its stakeholders. Your company''s current rankings in Sustainability indices affirm its efforts and validate the decision in aligning business with sustainability. With its sustainable development efforts remaining an unchanging priority, your Company is now looking at a future that is economically viable, environmentally friendly and socially just.

Tech Mahindra has been part of the Sustainability movement within the M&M Group and had been earlier reporting its sustainability performance in the Mahindra Group Sustainability Report. Since 2013-14, your Company has been highlighting the Sustainability performance in stand-alone Tech Mahindra Sustainability reports. The performance for both years has been externally assured by KPMG in accordance with the latest guidelines of the internationally accepted, Global Reporting Initiative (GRI). The detailed reports can be accessed at http:// www.techmahindra.com/company/Sustainability.aspx.

The focused efforts of your Company ensured that it has done well in the 3-year targets taken for critical material issues identifed in its business operations. Your Company is now in the process of mapping out the next 3-year roadmap with more emphasis on carbon emissions, carbon pricing and becoming carbon neutral.

The Company''s responsibilities and emphasis on its green eco-system is seen through the various energy, water and waste reduction initiatives that have helped cut down the carbon emissions. The Company insistence on associates following 4Ps- Pedal, Paidal, Pool and Public transport have also highlighted the importance of reducing pollution and being environmentally friendly. The Green Marshals at TechM, a small band of passionate associates spearhead the cause of environment and advocate sustainability across the organisation. The customers were helped by the Company to realize their sustainability objectives through its spectrum of services such as SMART cities solutions, Mobility, Cloud based solutions, platforms, data center consolidation services, MICRO Grid and Energy Management Services. We have ensured that we attract, mentor and retain the best talent through effecting an assured career development path and a feasible work-life balance.

The recent leadership position across platforms such as DJSI, CDP and CSR NewsAsia Rankings 2015, affrm its efforts and organizational strategy on sustainability. The highlights for the year 2015-16 have been in the following areas:

- Installation of 4277 Occupancy sensors across Pune, Hyderabad, Noida, Chennai & Bhubaneshwar led to reduced electricity consumption of 1159067 kWh & Carbon Emission Savings of 950.43 MTCO2.

- Ergonomics, Yoga and Wealth of Wellness initiative for associate well being.

- Successful commissioning of solar plants with a capacity of 1928 kWp at Chennai and Hyderabad. The overall capacity of Solar plants is now 2442kWp and the plants generated 2232875 units of Green power and Carbon Emission Savings of 1830.95 MTCO2.

- Participation and merit inclusion in Carbon Disclosure Project 2015 and Dow Jones Sustainability Index 2015.

- 121348 Kg of E-waste disposed through government authorized certifed vendors for recycling.

- Sewage Treatment Plants across 8 locations helped recycle and reuse 405139.2 Kl of water.

- Recycling of wet waste through vermicompost yielded 53.7 tons of manure which was used for landscaping.

- Green procurement of 2353 Laptops & 4795 Desktops helped save 607296 kWh of electricity & Carbon Emission Savings of 497.98 MTCO2.

- Reduction of Carbon emissions Scope 1 & 2 by 4.32% since base year FY 2012-13.

Pursuant to Regulation 34 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, a Business Responsibility Report is attached and forms part of this Annual Report.

AWARDS AND RECOGNITION

Your Company continued its quest for excellence in its chosen area of business to emerge as a true global brand. Several awards and rankings continue to endorse your Company as a thought leader in the industry. Mr. C. P. Gurnani, Managing Director & Chief Executive Officer was awarded the Best CEO of the Year Award at Forbes India Leadership Awards 2015. The awards / recognitions received by the Company during the year 2015-16 include:

- Golden Peacock Award in Innovation

- National Award for Supply Chain and Logistics Excellence

- ISG UK & Ireland Paragon Award for Collaboration

- Indo American Corporate Excellence Award for Excellence in CSR

- European IT Excellence Awards

- Dow Jones Sustainability Index under both emerging Markets and DJSI world Category

- Golden Peacock Award for Risk Management

- Deloitte Tech Fast 50 India 2015 Program

- Forbes 100 Middle East - Global meets Local 2015 Award

- Golden Peacock HR Excellence Award for Outstanding People Management Practices

- ET Telecom Awards for Cloud Technology

ACKNOWLEDGEMENTS

Your Directors place on record their appreciation for the contributions made by employees towards the success of your Company. Your Directors gratefully acknowledge the co-operation and support received from the shareholders, customers, vendors, bankers, regulatory and Governmental authorities in India and abroad.



For and on behalf of the Board

Place: Mumbai Anand G. Mahindra

Date: May 24, 2016 Chairman


Mar 31, 2015

Dear Members,

The Directors are pleased to present their Twenty-Fifth Report together with the audited accounts of your Company for the Financial Year ended 31st March, 2015.

The performance highlights and summarised financial results of the Company are given below:

PERFORMANCE HIGHLIGHTS

- Consolidated income for the year increased by 14% to Rs.6,060.91 Crores as compared to Rs.5,300.55 Crores in 2013-14;

- Consolidated income from operations for the year was Rs. 6,021.14 Crores as compared to Rs. 5,275.23 Crores in 2013-14, a growth of 14%;

- Consolidated profit before tax for the year was Rs.1,399.87 Crores as compared to Rs. 1,461.53 Crores in 2013-14;

- Consolidated profit after tax and minority interest for the year was Rs. 912.91 Crores as compared to Rs.954.42 Crores in 2013-14.

FINANCIAL RESULTS

Rs. in Crores

CONSOLIDATED STANDALONE March 2015 March 2014 March 2015 March 2014

Total Income 6,060.9 5,300.6 5,584.7 4,953.0

Less : Finance Costs 2,643.0 2,281.0 2,496.7 2,188.0

Expenditure 1,972.5 1,532.0 1,792.9 1,394.9

Depreciation/ Amortisation 45.5 26.1 41.5 24.3

Total Expenses 4,661.0 3,839.1 4,331.1 3,607.2

Profit Before Tax 1,399.9 1,461.5 1,253.6 1,345.8

Less : Provision For Tax Current Tax 576.1 580.0 520.0 535.4

Deferred Tax [101.1] [83.3] [98.2] [76.8]

Profit After Tax for the Year before 924.9 964.8 831.8 887.2

Minority Interest

Less : Minority Interest 12.0 10.4 - -

Profit After Tax for the Year after 912.9 954.4 831.8 887.2

Minority Interest

Add : Amount brought forward from 1,883.4 1,457.5 1,728.3 1,358.8

Previous Years

Add : Transfer of opening balance - - 5.3 - in profit and loss statement on amalgamation of Mahindra Business & Consulting Services Private Ltd

Less : Transitional depreciation 9.6 - 3.2 - charge/Special Reserve

Amount available for Appropriation 2,786.7 2,411.9 2,562.2 2,246.0

Appropriations

General Reserve 88.8 91.6 83.2 88.7

Statutory Reserve 179.3 184.7 166.4 177.5

Proposed Dividend on Equity Shares 227.5 216.1 227.5 216.1

Income-tax on Proposed Dividend 45.5 36.1 44.2 35.4

Surplus carried to Balance Sheet 2,245.6 1,883.4 2,040.9 1,728.3

TRANSFER TO RESERVES

The Company proposes to transfer an amount of Rs. 83.2 Crores to the General Reserve and Rs.166.4 Crores to the Statutory Reserve. An amount of Rs. 2,040.9 Crores is proposed to be retained in the Statement of Profit and Loss.

DIVIDEND

Your Directors are pleased to recommend a dividend of Rs. 4 per Equity Share of the face value of Rs. 2 each payable to those Members whose names appear in the Register of Members as on the Book Closure date. The dividend including dividend tax will absorb a sum of Rs. 271.7 Crores [as against Rs. 251.5 Crores on account of dividend of Rs. 3.80 per Equity Share paid for the previous year].

OPERATIONS

Your Company during the year under review, continued to offer a wide range of financial products and services to its customers through diversification of its product portfolio within its vehicle financing business as well as through the introduction and growth of other financial products in rural and semi-urban markets. The overall disbursement registered a decline of 4% at Rs. 24,331.1 Crores as compared to Rs. 25,400.0 Crores in the previous year, on account of difficult market conditions. Despite the diminution in disbursement, your Company was able to retain its leadership position in financing the Mahindra range of vehicles and tractors in addition to extending its lending to vehicles of other Original Equipment Manufacturers (OEMs).

Your Company has a pan-India presence with a network of 1 ,1 08 offices, which is one of the largest amongst Non-Banking Financial Companies operating in rural and semi-urban areas. The new branches opened by the Company in the villages are aimed at enhancing collections and providing services closer to the customers'' doorsteps. Your Company''s nationwide network of branches and locally recruited employees have facilitated in catering to the diverse financial requirements of its customers as well as in developing and strengthening relationship with them. Your Company has cumulatively financed over three and half million customers since its inception.

Total Income grew by 13% to Rs. 5,584.7 Crores for the year ended 31st March, 2015 as compared to Rs. 4,953.0 Crores for the previous year. Profit Before Tax (PBT) declined by 7% to Rs. 1,253.6 Crores as compared to Rs. 1,345.8 Crores for the previous year. Profit After Tax (PAT) declined by 6% to Rs. 831.8 Crores as compared to Rs. 887.2 Crores in the previous year.

During the year under review, the Assets Under Management stood at Rs. 36,878 Crores as at 31st March, 2015 as against Rs. 34,133 Crores as at 31st March, 2014.

There is no change in the nature of business of the Company during the year under review.

DISTRIBUTION OF MUTUAL FUND PRODUCTS

During the year under review, the activity of distribution of Mutual Fund Products (MFP) was carried out across 157 branches covering 20 States. As on 31st March, 201 5, the amount of Assets Under Management outstanding through the Company''s Advisory and Distribution Services on MFP, aggregate of institutional and retail segment, was Rs. 1,601.45 Crores and the number of clients stood at 42,967.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

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

CORPORATE GOVERNANCE

Your Company practices a culture that is built on core values and ethical governance practices and is committed to transparency in all its dealings. A Report on Corporate Governance along with a Certificate from the Statutory Auditors of the Company regarding the compliance of conditions of Corporate Governance as stipulated under Clause 49 of the Listing Agreement are annexed to this Report.

SHARE CAPITAL

The issued, subscribed and paid- up Equity Share Capital as on 31st March, 2015 was Rs. 113.75 Crores comprising of 56,87,64,960 Equity Shares of the face value of Rs.2 each. During the year under review, the Company has neither issued shares with differential rights as to dividend, voting or otherwise, nor has issued sweat equity, other than Employee Stock Options under the Employees'' Stock Option Scheme referred to in this Report. As on 31st March, 2015, none of the Directors of the Company holds instruments convertible into Equity Shares of the Company.

STOCK OPTIONS

During the year under review, on the recommendation of the Nomination and Remuneration Committee of your Company, the Trustees of the Mahindra & Mahindra Financial Services Limited Employees'' Stock Option Trust have granted 16,01,507 Stock Options to Eligible Employees under the Mahindra & Mahindra Financial Services Limited Employees'' Stock Option Scheme-2010. No new Options have been granted under the Mahindra & Mahindra Financial Services Limited Employees'' Stock Option Scheme - 2005.

Disclosure pertaining to details of the grants under the Mahindra & Mahindra Financial Services Limited Employees'' Stock Option Scheme-2005 and Mahindra & Mahindra Financial Services Limited Employees'' Stock Option Scheme-2010, in compliance with Clause 14 of the Securities and Exchange Board of India (Share Based Employee Benefits] Regulations, 2014 are set out in Annexure I to this Report. No employee has been issued stock options during the year, equal to or exceeding 1% of the issued capital of the Company at the time of grant.

Voting rights on the Shares issued to employees under the aforesaid schemes are either exercised by them directly or through their appointed proxy.

ECONOMY

The global economy continued to expand during 2014 at a moderate, however, uneven pace at 3.3% up from 3% in 201 3. Increasingly divergent trends have been observed in major economies. U.S. exceeded growth expectations. India and the U.K. recorded significant pickups in economic growth. Eurozone showed modest recovery in growth. However, this was offset by Japan struggling to strengthen its weak recovery, further slowdown in China, Russian and Brazilian economies faltering. Weaker-than- expected growth has been reflected in falling oil prices, which in turn have pushed inflation rates lower. Central banks have responded with a new wave of stimulus measures. The Reserve Bank of India''s (RBI] inflation focus, strong government mandate, over and above the benign global commodity prices have led to improvement in India''s economic fundamentals.

India''s macroeconomic fundamentals have improved in 2014-15. The annual growth rate of the Indian economy is estimated to have increased to 7.4% in 2014-15 as compared to 6.9% in the fiscal year 2013-14. The growth in 2014-15 is largely due to domestic demand. The growth in the exports is projected to be only 0.9% and the growth rate of imports, around -0.5%. The deceleration in imports owe substantially to the sharp decline in international oil prices. Acceleration in services and manufacturing growth in the face of subdued global demand conditions point to the strengthening of domestic demand. Manufacturing is expected to grow further with the Government of India making it a focus area with the ''Make in India'' initiative. However, agriculture suffered due to poor monsoon. The Gross Value Added (GVA] at basic prices in agriculture is expected to decline from 3.7 per cent in 2013-14, an exceptionally good previous year from the point of view of rainfall, to 1.1 per cent in 2014-15. Inflation has declined by over 6 percentage points since late 2013. Current Account Deficit came down from a peak of 6.7% of GDP (in Q3, 2012-13] to an estimated 1% in 2014-15. The average Wholesale Price Index inflation declined in 2014-15 to 3.5% (April-December] vis-a-vis 8.9% in 2013-14. Average retail inflation moderated to 6.3% in 2014-15 (April-December] from 9.5% in 2013-14.

With easing of inflationary conditions, the RBI signalled softening of the monetary policy stance by cutting policy repo rates by 25 bps in January and 25 bps in February to 7.5%. RBI also reduced the Statutory Liquidity Ratio by 50 bps to 21 .5% of Net Demand and Time Liabilities (NDTL]. RBI decided to infuse liquidity to banks on weekends through MSF operations. Liquidity conditions are expected to be comfortable in the coming year. These conditions should augur well for a reinvigoration of private consumption demand. This coupled with a stable government, thrust on rural infrastructure and reforms, it is expected that India''s growth will be strong.

The Company has maintained its leadership position for vehicles and tractors in the rural and semi-urban markets. Despite unfavourable monsoons affecting the tractor segment, the Company maintained a healthy growth of business backed by growth in the overall auto industry. All vehicle categories were in the positive territory except for commercial vehicles, which are gradually moving towards positive territory.

Source for global growth rates:

1. http://www.imf.org/external/ pubs/ft/weo/2015/ update/01/info.htm

2. http://www.kpmg.com/IN/en/ services/Tax/FlashNews/IES- 2014-15.pdf

3. http://rbi.org.in FINANCE

During the year under review, the Reserve Bank of India (RBI) remained focused on keeping the economy on a disinflationary glide path and targeted to hit 8% Consumer Price Index (CPI) inflation by January 2015 and 6 % by January 2016. The RBI continued its stance against inflation by holding the policy rates for the first nine months of the Fiscal Year 2014-15, while allowing the effects of past monetary policy tightening to work to bring down inflation. However, at the same time, RBI through active liquidity management operations ensured that Liquidity conditions remained broadly stable and it continued to provide liquidity through overnight and term repos. RBI remained committed to provide liquidity/credit to the productive sectors, and hence reduced the Statutory Liquidity Ratio (SLR) by 1 50 basis points (bps) during the year. With softening of international commodity prices, particularly crude oil, CPI decelerated sharply in second half of the year from September 2014, which allowed the RBI to cut the policy (Repo) rates by 50 bps during the last quarter of the year. The actions of RBI resulted in sovereign and corporate bond yields declining by 80 bps and more in the year. However, despite a generalized fall in the cost of funds, banks did not transmit that by reducing their base rates. Liquidity conditions remained in a deficit but stable mode throughout the year. However, your Company was able to take advantage of reduction in interest rates by devising appropriate borrowing strategies and ensuring that prudent Asset Liability Management Guidelines are adhered to.

During the year under review, your Company continued with its diverse methods of sourcing funds in addition to regular borrowings like Secured and Unsecured Debentures, Term Loans, Commercial Papers, etc., and maintained prudential Asset/ Liability match throughout the year. Your Company sourced long term debentures and loans from banks and other institutions at attractive rates.

Your Company also issued Subordinated Debt amounting to Rs. 21 5 Crores and successfully completed five at par securitisation transactions aggregating to Rs. 722.3 Crores.

During the year, your Company actively participated in a number of investor meets both in India and abroad organised by reputed Global and Domestic Broking Houses. Your Company also periodically conducted analysts'' meets and conference calls to communicate details of performance, important developments and exchange of information.

CAPITAL ADEQUACY

As on 31 st March, 2015, the Capital to Risk Assets Ratio (CRAR) of your Company was 18.3%, which is well above 1 5.0% CRAR prescribed by the RBI.

RBI GUIDELINES

The Company has complied with all the applicable regulations of the Reserve Bank of India (RBI). As a prudent practice, your Company makes accelerated provisioning for Non-Performing Assets (NPAs) than that required by RBI for NBFCs. Your Company continues to make a general provision at 0.40% on the standard assets outstanding as against 0.25% mandated by the RBI.

CREDIT RATING

During the year under review, India Ratings & Research Private Limited, which is part of Fitch Group, upgraded the rating of the Company''s National Long-term instrument and Lower Tier II Subordinated Debt programme to ''IND AAA/Stable'' from ''IND AA /Stable''.

During the year under review, CARE Ratings, has assigned the ''CARE AAA'' rating to the Company''s Long-term Debt instruments and Lower Tier II Subordinated Debt programme.

Brickwork Ratings India Private Limited has, during the year, upgraded the rating of the Company''s Long-term Subordinated Debt Issue to ''BWR AAA/Stable'' from ''BWR AA /Positive''.

The ''AAA'' ratings denote the highest degree of safety regarding timely servicing of financial obligations. Such instruments carry lowest credit risks.

During the year under review, CRISIL Limited [CRISIL], has reaffirmed the rating to the Company''s Long- term Debt Instruments and Bank Facilities as ''CRISIL AA / Stable'' and the Company''s Fixed Deposit Programme as ''FAAA/Stable'', respectively. The ''AA /Stable'' rating indicates a high degree of safety with regard to timely payment of financial obligations. The rating on the Company''s Short-term Debt and Bank Loans has been reaffirmed at ''CRISIL A1 '' which is the highest level of rating.

ACHIEVEMENTS

During the year under review, your Company was awarded the ''Golden Peacock HR Excellence'' for 2014, the Golden Peacock National Training Award, CII National HR Excellence Award, CSR Award by Indian Development Foundation, and the BFSI Award for CSR, Health Care and Combating Diseases category.

Your Company has won three awards in the "IT-NEXT 100 CIOs" for the third year in a row as well as topped the charts by winning the highest number of PRCI (Public Relations Council of India] Awards in twelve categories. Your Company was also awarded the LACP Awards for its Annual Report for the financial year 2013-14, IDC Insights Award for Excellence in Innovation, the Financial Inclusion & Payment Systems (FIPS] Award 2014 and the RMAI - Flame Awards 2014.

The Company''s IS020000:2011 certification of Information Technology has been confirmed and extended till 11th April, 2017. Your Company has also been included in the RobecoSAM Sustainability Yearbook 2015.

FIXED DEPOSITS AND LOANS/ ADVANCES

As on 31st March, 2015, your Company has mobilized funds from Fixed Deposits to the tune of Rs. 4,680 Crores, with an investor base of over 1,68,306 investors.

Your Company has initiated several measures towards improvement of service levels in sync with the requirements of the Fixed Deposit holders. As a customer-centric process, the Company communicates various intimations via SMS, e-mails, etc., to its investors. During the year under review the Company has started sending E-receipts (FDR E-receipts], pre-printed Forms 15G and 15H with barcode, bulk intimation letters, etc., on the customers'' e-mail ID registered with the Company. Further, in order to encourage investments by small investors, your Company has also introduced Micro Deposits (under its Cumulative Scheme] with a minimum investment amount of Rs. 5,000 and upto a maximum investment amount of Rs.9,000 having a tenure of 12 months to 60 months.

As at 31st March, 2015, 987 deposits amounting to Rs. 4.9 Crores had matured for payment and remained unclaimed. The unclaimed deposits have since reduced to 823 deposits amounting to Rs. 4.0 Crores.

Your Company being a Non-Banking Financial Company, the disclosures required as per Rule 8 (5](v] and (vi] of the Companies (Accounts] Rules, 2014 read with Sections 73 and 74 of the Companies Act, 2013, are not applicable to it.

The particulars of loans/advances and investment in its own shares by listed companies, their subsidiaries, associates, etc., required to be disclosed in the Annual Accounts of the Company pursuant to Clause 32 of the Listing Agreement are furnished separately.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS IN SECURITIES

Pursuant to section 186 (11] of the Companies Act, 2013 (''the Act''], the provisions of section 186(4] of the Act requiring disclosure in the financial statement of the full particulars of the loans made and guarantees given or securities provided by a Non-Banking Financial Company in the ordinary course of its business 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 exempted from disclosure in the Annual Report.

Further, pursuant to the provisions of Section 186 (4] of the Act, the details of investments made by the Company are given in the Notes to the Financial Statement.

SUSTAINABILITY INITIATIVES

Your Company continues to protect and sustain the rural livelihoods through a sustainable business model. The business model aims at transforming rural lives and driving positive change in the community. Your Company has been reporting on Triple Bottom Line Performance;

i.e., People, Profit and Planet since the Financial Year 2008-09 through the Mahindra Group Sustainability Report.

During the Financial Year 2014-15, your Company released its second standalone Sustainability Report for the previous Financial Year 2013- 14. This Report portrays a balanced approach towards economic activity, environmental responses and social progress. This Report is externally assured and in line with international reporting standards of Global Reporting Initiative (GRI] G3.1 Guidelines. The theme of the Report is ''Co-Creating Opportunities Empowering Lives'' and the same has been hosted on the Company''s website.

During the year under review, your Company continued with its focus on sustainability awareness for employees, vendors and customers and took various initiatives in this direction. Your Company made proactive efforts to fight against global warming through Project ''Mahindra Hariyali'', by planting more than 78,000 saplings across the country. Various initiatives were also taken for energy, paper and e-waste management.

In addition to this, your Company continues to report on Carbon Disclosure Project (CDP] from the Financial Year 2011-1 2. CDP seeks information on carbon emissions disclosures from the world''s largest companies and focuses on how companies are geared up, to deal with the challenges of climate change in a carbon constrained economy. During the year under review, your Company also became part of CDP''s Carbon Disclosure Leadership

Index [CDLI] 2014, acknowledging the Company''s efforts for climate change mitigation.

Your Company has been listed on the Dow Jones Sustainability Index (DJSI] Emerging Market Trends for the second consecutive year. To be incorporated in the DJSI, companies are assessed and selected based on their long term Environmental Social Governance (ESG] asset management plans.

Your Company was also included in the ''RobecoSAM Sustainability Yearbook'', which lists the world''s most sustainable companies in each industry as determined by their score in RobecoSAM''s annual Corporate Sustainability Assessment (CSA]. Your Company is the first and only Indian Company from amongst the Banks and Financial Services Companies in India to have made it to this list.

CORPORATE SOCIAL RESPONSIBILITY

Through its various Corporate Social Responsibility ("CSR"] initiatives, the Mahindra Group is enabling entire communities to ''RISE''. With a vision of transforming the lives of youth from socially weaker and economically disadvantaged sections of society, the Mahindra Group is committed to ''building possibilities'' to enable them to ''RISE'' above their limiting circumstances by innovatively supporting them through programs in the domains of education, health and environment.

The Company has duly constituted a CSR Committee in accordance with section 135 of the Companies Act, 2013 to assist the Board and the Company in fulfilling the corporate social responsibility objectives of the Company. The CSR Committee presently comprises Mr. Bharat Doshi (Chairman], Mr. Piyush Mankad, Mr. Uday Y. Phadke and Mr. Ramesh Iyer.

During the year under review, your Company organised a nationwide Blood Donation Drive, Health check- up camps and visits to Orphanages/ Differently-abled Homes/Old-age homes, to re-affirm its pledge to the society. The ''Lifeline Express'', a hospital on wheels, in association with Impact India Foundation, catered to the medical needs of 4,936 underprivileged people in Motihari (Bihar].

As a part of its commitment to Corporate Social Responsibility, during the year, your Company initiated projects for scholarships for undergraduate and graduate students, vocational training, financial literacy, supporting technology incubators, agri-based livelihood skills and sanitation. The Company also continued its support to Nanhi Kali, the flagship programme of the K.C. Mahindra Education Trust, which aids the education of the disadvantaged girl child.

During the year under review, your Company has spent Rs. 24.9 crores on CSR projects/programs. Your Company is in compliance with the statutory requirements in this regard.

The CSR Policy of the Company is hosted on the Company''s website at the link http://www. mahindrafinance.com/csr.aspx and a brief outline of the CSR Policy and the CSR initiatives undertaken by the Company during the year as per Annexure prescribed in the Companies (Corporate Social Responsibility Policy] Rules, 2014 have been appended as Annexure II to this Report.

EXTRACT OF ANNUAL RETURN

Pursuant to sub-section 3(a] of Section 1 34 and sub-section (3] of Section 92 of the Companies Act, 2013, read with Rule 12 of the Companies (Management and Administration] Rules, 2014, an extract of the Annual Return as at 31st March, 2015 forms part of this Report and is appended herewith as Annexure III.

BOARD MEETINGS AND ANNUAL GENERAL MEETING

The calendar of the Board/ Committee Meetings and the Annual General Meeting are circulated to the Directors in advance to enable them to plan their schedule for effective participation at the respective meetings. Additional Board Meetings are convened by giving appropriate notice to address business exigencies. At times certain decisions are taken by the Board/Committee through circular resolutions.

The Board met seven times in the financial year 2014-15 viz., on 23rd April, 2014, 24th July, 2014, 22nd October, 2014, 16th December, 2014, 16th January, 2015,

17th January, 2015 and 20th March, 2015. The gap between two Meetings did not exceed one hundred and twenty days. The 24th Annual General Meeting ("AGM"] of the Company was held on 24th July,

2014.

Detailed information on the meetings of the Board, its Committees and the AGM is included in the Report on Corporate Governance, which forms part of this Annual Report.

MEETING OF INDEPENDENT DIRECTORS

The Independent Directors met once during the year under review. The Meeting was conducted in an informal manner without the presence of the Chairman, the Managing Director, the Non-Executive Non-Independent Directors and the Chief Financial Officer.

COMMITTEES OF THE BOARD OF DIRECTORS

The Company has various committees which have been constituted as a part of the good corporate governance practices and the same are in compliance with the requirements of the relevant provisions of applicable laws and statutes.

Your Company has an adequately qualified and experienced Audit Committee with Mr. Dhananjay Mungale as the Chairman and Mr. M. G. Bhide, Mr. Uday Y. Phadke, Ms. Rama Bijapurkar, Mr. Piyush Mankad, Mr. C.B. Bhave and Mr. V. S. Parthasarathy as Members. The recommendations of the Audit Committee were duly approved and accepted by the Board during the year under review.

The other Committees of the Board are :

i) Nomination and Remuneration Committee

ii) Stakeholders Relationship Committee

iii) Corporate Social Responsibility Committee

iv) Risk Management Committee

v) Asset Liability Committee

vi) Strategy Committee for Acquisitions

The details with respect to the composition, powers, roles, terms of reference, Meetings held and attendance of the Directors at such Meetings of the relevant Committees are given in detail in the Report on Corporate Governance of the Company which forms part of this Annual Report.

DIRECTORS AND KEY MANAGERIAL PERSONNEL Directors

The Members of the Company at the Annual General Meeting held on 24th July, 2014 had appointed Mr. Piyush Mankad, Mr. M. G. Bhide, Mr. Dhananjay Mungale and Ms. Rama Bijapurkar as Independent Directors for a period of five consecutive years commencing from 24th July, 2014.

Pursuant to the provisions of section 152 of the Companies Act, 2013 (''the Act''), Mr. Uday Y. Phadke, Non- Executive Non-Independent Director of the Company retires by rotation at the forthcoming Annual General Meeting scheduled to be held on 24th July, 2015. Mr. Phadke has expressed his desire not to seek re- appointment. It is proposed not to fill up the vacancy thereby caused.

Mr. Uday Y. Phadke joined the Board of Directors of the Company in May 1999. He was elevated as the Vice-Chairman in April 2008. While continuing as a Member of the Board of Directors Mr. Phadke stepped down as the Vice-Chairman in October 2011.

The Board acknowledged Mr. Phadke''s contribution to the Company and placed on record its deep appreciation of the invaluable counsel rendered by him to the Company and his immense contribution in guiding the management during his tenure as Vice-Chairman and as a Director of the Company.

On the recommendation of the Nomination and Remuneration Committee, the Board at its adjourned Meeting held after the Annual General Meeting on 24th July, 2014 had appointed Mr. V. S. Parthasarathy as an Additional Director on the Board of Directors of the Company. Mr. Parthasarathy holds office up to the date of the Annual General Meeting of the Members to be held on 24th July, 2015.

The Company has received a notice from a Member under section 160 of the Act, signifying his intention to propose Mr. V. S. Parthasarathy as a candidate for the office of Director of the Company at the forthcoming Annual General Meeting.

On the recommendation of the Nomination and Remuneration Committee and the Board of Directors, Mr. C. B. Bhave has been appointed as an Independent Director of the Company for a period of five consecutive years commencing from 3rd February, 2015, by the Shareholders by means of a Postal Ballot voting process.

None of the Independent Directors are due for re-appointment.

Key Managerial Personnel

Mr. Ramesh Iyer, Managing Director, Mr. V. Ravi, Chief Financial Officer and Ms. Arnavaz M. Pardiwala, Company Secretary of the Company are the Key Managerial Personnel of the Company as per the provisions of the Companies Act, 2013. Their appointment as Key Managerial Personnel have been duly formalised pursuant to section 203 of the Companies Act, 2013, which came into effect from 1st April, 2014.

DECLARATION BY INDEPENDENT DIRECTORS

The Company has received declarations from all the Independent Directors of the Company confirming that they fulfill the criteria of independence as prescribed under sub-section (6) of section 149 of the Companies Act, 201 3 and under Clause 49 of the Listing Agreement with the Stock Exchanges.

DIRECTORS’ RESPONSIBILITY STATEMENT

Pursuant to the provisions of Section 134(5) of the Companies Act, 2013, (''the Act'') your Directors confirm that:

i. In the preparation of the annual accounts for financial year ended 31st March, 2015, the applicable accounting standards have been followed and there are no material departures in adoption of these standards;

ii. The Directors have selected such 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 at 31st March, 2015 and of the profit of the Company for the year ended on that date.

iii. The Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

iv. The Directors have prepared the annual accounts for financial year ended 31st March, 2015 on a ''going concern'' basis.

v. The Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and have been operating efficiently.

vi. The Directors have devised proper systems to ensure compliance with provisions of all applicable laws and that such systems were adequate and operating effectively.

PERFORMANCE EVALUATION OF THE BOARD

The Companies Act, 2013 and revised Clause 49 of the Listing Agreement entered into with the Stock Exchanges stipulates the evaluation of the performance of the Board, its Committees, Individual Directors and the Chairperson.

The Company has formulated a Policy for performance evaluation of the Independent Directors, the Board, its Committees and other individual Directors which includes criteria for performance evaluation of the Non-Executive Directors and Executive Directors.

The evaluation framework for assessing the performance of Directors comprises of various key areas such as attendance at Board

and Committee Meetings, quality of contribution to Board discussions and decisions, strategic insights or inputs regarding future growth of the Company and its performance, ability to challenge views in a constructive manner, knowledge acquired with regard to the Company''s business/ activities, understanding of industry and global trends, etc.

The evaluation involves self- evaluation by the Board Member and subsequent assessment by the Board of Directors. A member of the Board will not participate in the discussion of his/her evaluation.

Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the Board has carried out an annual performance evaluation of its own performance, the Directors individually as well as the evaluation of the working of its Committees.

Well-defined and structured questionnaires were prepared after taking into consideration inputs received from the Directors, covering various aspects of the Board''s functioning such as adequacy of the composition of the Board and its Committees, Board culture, areas of responsibility, execution and performance of specific duties, obligations and governance, compliance, oversight of Company''s subsidiaries, etc.

A separate exercise was carried out to evaluate the performance of individual Directors who were evaluated on several parameters such as level of engagement and contribution, independence of judgment safeguarding the interest of the Company and its minority shareholders and knowledge acquired with regard to the Company''s business/activities.

The performance evaluation of the Independent Directors was carried

out by the entire Board excluding the Director being evaluated. The performance evaluation of the Chairman and the Non-Independent Directors was carried out by the Independent Directors. Qualitative comments and suggestions of Directors were taken into consideration by the Chairman of the Board and the Chairman of the Nomination and Remuneration Committee. The Directors have expressed their satisfaction with the evaluation process.

Familiarisation Programme for Independent Directors

The details of programmes for familiarisation of Independent Directors with the Company, their roles, rights, responsibilities in the Company, nature of the industry in which the Company operates, business model of the Company and related matters are given in the Report on Corporate Governance and the same are also available on the website of the Company at the link: http://www.mahindrafinance.com/ pdf/familiarisation-programme-for- IDs.pdf.

Policies on Appointment of Directors and Remuneration of Directors, Key Managerial Personnel and Employees

In accordance with the provisions of section 134(3](e] of the Companies Act, 2013 ("the Act"] read with sections 178(2] of the Act and Clause 49 of the Listing Agreement, the Company has formulated a Policy on Appointment of Directors and Senior Management and succession planning for orderly succession to the Board and the Senior Management, which inter alia, includes the criteria for determining qualifications, positive attributes and independence of Directors.

The Company has also adopted the Policy on Remuneration of Directors and the Remuneration Policy for Key Managerial Personnel and Employees of the Company in accordance with the provisions of sub-section [4] of section 178, and the same are appended as Annexure IV-A and Annexure IV-B and form part of this Report.

The criteria for determining qualifications, positive attributes and independence of a Director and the Remuneration Policy for Directors, Key Managerial Personnel and other employees have been discussed in detail in the Report on Corporate Governance.

AUDITORS Statutory Auditors

Messrs. B. K. Khare & Co., Chartered Accountants, [ICAI Firm Registration No.105102W] the Statutory Auditors of the Company, hold office till the conclusion of the forthcoming Annual General Meeting [AGM] and are eligible for re-appointment. Pursuant to the provisions of section 139 of the Companies Act, 2013 and the Rules framed thereunder, it is proposed to appoint Messrs. B. K. Khare & Co., as the Statutory Auditors of the Company from the conclusion of the forthcoming AGM till the conclusion of the next AGM.

As required under the provisions of section 139(1) of the Companies Act, 2013 the Company has received a written consent from Messrs. B. K. Khare & Co., Chartered Accountants to their re-appointment and a Certificate, to the effect that their re-appointment, if made, would be in accordance with the Companies Act, 2013 and the Rules framed thereunder and that they satisfy the criteria provided in section 141 of the Companies Act, 2013 read with Rule 4(1) of the Companies (Audit and Auditors) Rules, 2014.

The Auditors'' Report does not contain any qualification, reservation or adverse remark.

Secretarial Auditor

The Board of Directors of the Company has appointed Dr. K. S. Ravichandran, Managing Partner, KSR & Co., Company Secretaries LLP, to conduct the Secretarial Audit of the Company for the Financial Year 2014-15, pursuant to the provisions of section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. In accordance with the provisions of sub-section (1) of section 204, the Secretarial Audit Report for the Financial Year 2014-15 is appended to this Report as Annexure V.

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

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All contracts/arrangements/

transactions entered into by the Company during the Financial Year with related parties were in the ordinary course of business and on an arm''s length basis. During the year, the Company had not entered into any contract/ arrangement/ transaction with related parties which could be considered material in accordance with the Policy on Related Party Transactions. Pursuant to section 134(3) (h) read with Rule 8(2) of the Companies (Accounts) Rules, 2014, there are no transactions to be reported under Section 188(1) of the Companies Act, 2013. None of the Non-Executive Directors has any pecuniary relationships or transactions vis-a-vis the Company.

The Policy on Related Party Transactions as approved by the Audit Committee and the Board of Directors of the Company is uploaded on the website of the Company and same can be accessed on the web link : http://www.mahindrafinance. com/policies.aspx.

MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY

There have been no material changes and commitments, affecting the financial position of the Company which have occurred between the end of the financial year of the Company to which the financial statement relate and the date of this Report.

RISK MANAGEMENT POLICY

Your Company has a comprehensive Risk Management Policy in place and has laid down a well-defined risk management framework to identify, assess and monitor risks and strengthen controls to mitigate risks. Your Company has established procedures to periodically place before the Risk Management Committee and the Board of Directors, the risk assessment and minimisation procedures being followed by the Company and steps taken by it to mitigate these risks.

The development and implementation of Risk Management Policy adopted by the Company is discussed in detail in the Management Discussion and Analysis chapter, which forms part of this Annual Report.

WHISTLE BLOWER POLICY/ VIGIL MECHANISM

The Company promotes ethical behaviour in all its business activities and has established a vigil mechanism for Directors and Employees to report their genuine concerns.

The Vigil Mechanism as envisaged in the Companies Act, 2013 and the Rules prescribed is implemented through the Whistle Blower Policy, to provide for adequate safeguards against victimization of persons who use such mechanism and make provision for direct access to the Chairperson of the Audit Committee.

As per the Whistle Blower Policy implemented by the Company, the Employees are free to report illegal or unethical behaviour, actual or suspected fraud or violation of the Company''s Codes of Conduct or Corporate Governance Policies or any improper activity to the Chairman of the Audit Committee of the Company or Chairman of the Company or the Corporate Governance Cell.

The Whistle Blower Policy provides for protected disclosure and protection to the Whistle Blower. Under the Whistle Blower Policy, the confidentiality of those reporting violation(s) is protected and they are not subject to any discriminatory practices.

The Whistle Blower Policy has been appropriately communicated within the Company and has also been hosted on the website of the Company: http://www.mahindrafinance.com/ pdf/MMFSL_VigilMechanism.pdf. No personnel have been denied access to the Audit Committee.

SUBSIDIARIES, JOINT VENTURE AND ASSOCIATES

A Report on the performance and financial position of each of the subsidiaries and the joint venture company as per the Companies Act, 2013 is provided as Annexure A to the Consolidated Financial Statement and hence not repeated here for the sake of brevity. The policy for determining material subsidiaries as approved may be accessed on the Company''s website at the web link : http://www.mahindrafinance.com/ policies.aspx

Subsidiaries

Mahindra Insurance Brokers Limited

During the year under review, Mahindra Insurance Brokers Limited (MIBL) serviced 1.1 million insurance cases, with a total of 11,37,981 cases for both Life and Non-Life Retail business. The customized Life insurance cover "Mahindra Loan Suraksha" (MLS) declined from 5,09,864 lives covered with a Sum Assured of Rs. 14,393.5 crores in the Financial Year 2013- 14 to 4,59,781 lives covered with a Sum Assured of Rs. 13,515.4 crores in the Financial Year 2014- 15. This primarily was on account of the general economic slowdown witnessed during the year having a cascading impact on the auto- manufacturing and auto financing industry. A substantial portion of MLS though continued to be covered in the rural markets.

MIBL achieved a growth of 22% in Gross Premium facilitated for the Corporate and Retail business lines, increasing from Rs. 825.2 crores in the Financial Year 2013-14 to Rs. 1,002.7 crores in the Financial Year 2014-15 crossing the 1,000 crores mark.

The Total Income of MIBL increased by 14% from Rs. 111.2 crores in the Financial Year 2013-14 to Rs.126.2 crores in the Financial Year 2014-15. The Profit before Tax increased by 2% from Rs. 63.8 crores to Rs. 65.3 crores, and the Profit after Tax increased by 2% from Rs. 42.0 crores to Rs. 42.9 crores during the same period.

Mahindra Rural Housing Finance Limited

Mahindra Rural Housing Finance Limited (MRHFL) has during the year ended 31st March, 2015, disbursed loans aggregating Rs. 989.6 crores (previous year Rs. 630.6 crores) achieving a growth of 57% over the previous year. Profit after tax was 63% higher at Rs. 44.2 crores as compared to Rs. 27.1 crores for the previous year. The outstanding loan portfolio as at 31st March, 2015 stood at Rs. 2,098.3 crores.

MRHFL continued its focus on serving customers in rural India. Majority of the loans disbursed were to customers in villages with an average annual household income of less than Rs. 2 lakhs. During the year under review, around 81,960 families were given home loans (in addition to around 1,81,120 existing families as on 31st March, 2014). MRHFL has been expanding its geographical presence, to provide affordable services for rural households and has also entered the semi-urban market segment.

Mahindra Asset Management Company Private Limited

Mahindra Asset Management Company Private Limited (MAMCPL), the wholly-owned subsidiary of the Company, which will be engaged as an investment manager to the proposed Mahindra Mutual Fund, is currently in the process of obtaining regulatory approval from the Securities and Exchange Board of India. During the year under review, MAMCPL has not commenced any business activities.

Mahindra Trustee Company Private Limited

Mahindra Trustee Company Private Limited (MTCPL), the wholly-owned subsidiary of the Company, which will be engaged as a Trustee to the proposed Mahindra Mutual Fund, is currently in the process of obtaining regulatory approval from the Securities and Exchange Board of India. During the year under review, MTCPL has not commenced any business activities.

Amalgamation of Mahindra Business & Consulting Services Private Limited ("MBCSPL") with the Company

Mahindra Business & Consulting Services Private Limited (MBCSPL), a wholly-owned subsidiary of your Company was engaged in the business of providing staffing services to the Mahindra group companies and had no business operations as on the date of announcement of the Scheme of Amalgamation of MBCSPL with the

Company and their Shareholders and Creditors.

In order to have a simplified corporate structure, rationalisation of administrative, operative and marketing costs and to enable cost saving and optimum utilization of valuable resources leading to higher operational efficiency, a Scheme of Amalgamation of MBCSPL with the Company and their Shareholders and Creditors was announced. The same was approved by the Public Shareholders by means of a Postal Ballot voting process (including e-voting) on 13th January, 2015.

The Scheme has been approved by the Honourable High Court of Judicature at Bombay on 20th March, 2015 and the same has been made effective from 18th April, 201 5, by filing the certified copy of the Order with the Registrar of Companies. The appointed date of the Scheme is 1st April, 2014.

Joint Venture Mahindra Finance USA LLC.

The joint venture company''s disbursement registered a growth of 22.42% to USD 5,337.09 Lacs for the year ended 31st March, 2015 as compared to USD 4,359.69 Lacs for the previous year. Income grew by 36.35% to USD 220.43 Lacs for the year ended 31st March, 2015 as compared to USD 161.66 Lacs for the previous year. Profit Before Tax was 41.30% higher at USD 70.99 Lacs as compared to USD 50.24 Lacs for the previous year. Profit After Tax grew at a healthy rate of 38.59% to USD 45.47 Lacs as compared to USD 32.81 Lacs in the previous year.

Names of companies which have become or ceased to be subsidiaries, joint ventures or associate companies during the year

During the year under review, no company has become a subsidiary of the Company.

Consequent upon the amalgamation of Mahindra Business & Consulting Services Private Limited (MBCSPL) with the Company, MBCSPL has ceased to be a subsidiary of the Company.

Further, no company has become or ceased to be a joint venture or associate during the Financial Year 2014-15.

The Company shall provide the copy of the annual accounts of its subsidiary companies and the related information to the Members of the Company on their request. The annual accounts of the subsidiary companies will also be kept open for inspection by any Members at the Registered Office of the Company and also at the Registered Office of the respective subsidiary companies during working hours upto the date of the Annual General Meeting. The Annual Reports of the subsidiaries will also be available on your Company''s website at the link : http://www.mahindrafinance.com/ annual-reports.aspx

Material Non-Listed Indian Subsidiary

Pursuant to Clause 49 of the Listing Agreement entered into by the Company with the Stock Exchanges, if the turnover or net worth (i.e. paid- up capital and free reserves) of any unlisted Indian subsidiary company exceeds 20% of the consolidated turnover or net worth respectively of the listed holding company and its subsidiaries in the immediately preceding accounting year; that subsidiary would be termed as a ''Material Non-Listed Indian Subsidiary''.

In view of the above, there is no material non-listed Indian subsidiary of your Company for the Financial Year 2014-15.

Consolidated Financial Statements

The Consolidated Financial Statements of the Company and its four subsidiaries viz. Mahindra Insurance Brokers Limited, Mahindra Rural Housing Finance Limited, Mahindra Asset Management Company Private Limited and Mahindra Trustee Company Private Limited prepared in accordance with Accounting Standard AS 21 prescribed by The Institute of Chartered Accountants of India, form part of this Annual Report. The Consolidated Financial Statements presented by the Company include the financial results of its subsidiary companies and its joint venture viz. Mahindra Finance USA LLC.

Details of significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and the Company’s operations in future There are no significant and material orders passed by the regulators or courts or tribunals that would impact the going concern status of the Company and its future operations.

Details in respect of adequacy of internal financial controls with reference to the Financial Statements

Your Company has in place adequate internal financial controls with reference to financial statements, commensurate with the size, scale and complexity of its operations. Review of the internal financial controls environment of the Company was undertaken during the year which covered verification of entity level control, process level control and IT controls, identification, assessment and definition of key business processes and analysis of risk control matrices, etc. Reasonable Financial Controls are operative for all the business activities of the Company and no material weakness in the design or operation of any control was observed.

Mr. Ramesh Iyer, Managing Director of the Company does not receive any remuneration or commission from any of the subsidiaries of the Company. However, Mr. Iyer has been granted stock options under the Employees'' Stock Option Scheme of the holding Company, Mahindra & Mahindra Limited.

20 employees were in receipt of remuneration of Rs.60 lakhs per annum or more amounting to Rs. 23.66 crores for the Financial Year ended 31st March, 2015.

In terms of the provisions of section 197 of the Act read with Rules 5 (2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 details in respect of employees of the Company employed during the year and in receipt of remuneration for the year not less than sixty lakh rupees or employed for a part of the financial year and in receipt of remuneration not less than five lakh rupees per month, is provided in Annexure VI.

None of the employees listed in the said Annexure is a relative of any Director of the Company.

None of the employees holds either by himself or along with his spouse or dependent children, more than two per cent of the Equity Shares of the Company.

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

Your Company is an equal opportunity employer and is committed to ensuring that the work environment at all its locations is conducive to fair, safe and harmonious relations

between employees. It strongly believes in upholding the dignity of all its employees, irrespective of their gender or seniority. Discrimination and harassment of any type are strictly prohibited.

The Company has in place an appropriate Policy in accordance with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, to prevent sexual harassment of its employees. All employees are covered under this Policy. The Company ensures that no employee is disadvantaged by way of gender discrimination.

During the year under review, there were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and Rules framed thereunder.

Conservation of Energy,

Technology Absorption, and Foreign Exchange Earnings and Outgo

The particulars in respect of conservation of energy, technology absorption and foreign exchange earnings and outgo, as required under sub-section (3) (m) of section 134 of the Companies Act, 2013 read with Rule (8)(3) of the Companies (Accounts) Rules, 2014 are given as under :

(A) Conservation of Energy

(i) The steps taken or impact on conservation of energy :

The operations of your Company are not energy intensive. However, adequate measures have been initiated to reduce energy consumption.

(ii) The steps taken by the Company for utilizing alternate sources of energy:

During the year the Company has spent Rs.0.16 crores towards implementing solar power system in various branches.

(iii) The capital investment on energy conservation equipments: Nil

(B) Technology Absorption

(i) The efforts made towards technology absorption : Not Applicable.

(ii) The benefits derived like product improvement, cost reduction, product development or import substitution : Not Applicable.

(iii) i n case of imported technology (imported during the last three years reckoned from the beginning of the Financial Year): Not Applicable.

(a) Details of Technology Imported;

(b) Year of Import;

(c) Whether the Technology has been fully absorbed;

(d) if not fully absorbed, areas where absorption has not taken place, and the reasons thereof.

(iv) Your Company has not incurred any expenditure on Research and Development during the year under review.

(C) Foreign Exchange Earnings and Outgo

The information on foreign exchange outgo is furnished in the Notes to the Accounts. There were no foreign exchange earnings during the year.

For and on behalf of the Board

Bharat Doshi Chairman


Mar 31, 2015

Dear Members,

The Directors present their Twenty-Eighth Annual Report together with the audited accounts of your Company for the year ended 31st March, 2015.

FINANCIAL RESULTS (STANDALONE)

(Rs. Million)

For the year ended 31st March 2015 2014

Income 192,872 163,654

Profit before Interest, Depreciation, exceptional items and tax 33,511 36,316

Interest (86) (868)

Depreciation (4,733) (4,270)

Profit before exceptional items and tax 28,692 31,178

Exceptional items 613 1,200

Profit Before Tax 29,305 32,378

Provision for taxation (6,743) (5,523)

Profit after tax 22,562 26,855

Balance brought forward from previous year 43,856 27,495

Adjustments on account of Amalgamation 1,140 (2,396)

Profit available for appropriation 67,558 51,954

Transfer from Debenture Redemption Reserve 2,972 2,366

Final Dividend (28)* (1)

Tax on final dividend

Dividend (Proposed) (5,765) (4,669)

Tax on dividend (1,173) (794)

Transfer to General Reserve - (5,000)

Balance carried forward 63,559 43,856

* In respect of equity shares issued pursuant to exercise of Stock Options after 31st March 2014 but before book closure date, the Company paid dividend of Rs. 27.9 Million for the year 2013-14 and tax on dividend thereto of Rs. 4.7 Million as approved by the shareholders at the Annual General Meeting held on August 1, 2014.

DIVIDEND

Your Directors are pleased to recommend a dividend of Rs. 6/- per Equity Share (120%), payable to those Shareholders whose names appear in the Register of Members as on the Book Closure Date.

SHARE CAPITAL

During the year under review, your Company allotted 4,259,011 equity shares of face value of Rs. 10/- each to the shareholders of erstwhile Mahindra Engineering Services Limited (''MESL'') upon consummation of the amalgamation of MESL with your Company. Further, your Company allotted 2,572,284 equity shares on the exercise of stock options under various Employee Stock Option Plans.

Your Board of Directors recommended for issue of Bonus shares in the ratio of 1:1 and sub-division of

Equity Shares of Rs. 10/- each into two Equity Shares of Rs. 5/- each which was approved by the Shareholders through postal ballot and e-voting on 10th March, 2015. Accordingly, bonus shares in the ratio of 1:1 were allotted to the members who held the equity shares on the Record Date i.e., March 20, 2015 by capitalization of balance in the Free Reserves amounting to Rs. 2,401,615,770. Further, the Equity Shares of face value of Rs. 10/- each were sub-divided into two Equity Shares of face value of Rs. 5/- each by way of corporate action to the shareholders who held the shares on the Record Date mentioned hereinabove.

Consequently the issued, subscribed and paid-up equity share capital has increased from Rs. 2,401.6 Million divided into 240,161,577 equity shares of Rs. 10/- each to Rs. 4,803.2 Million divided into 960,646,308 equity shares of Rs. 5/- each.

BUSINESS PERFORMANCE / FINANCIAL OVERVIEW

The Company offers a full range of IT services and industry specific solutions to its clients. The Company has partnered with several Fortune 100 companies to deliver outstanding solutions across industries. The Company offers a bouquet of services which includes Telecom Services, Consulting, Application Outsourcing, Infrastructure Outsourcing, Engineering Services, BPO, Platform Solutions and Mobile Value Added Services. With an impeccable track record of delivery and strong alliances with leading technology and product vendors, the Company serves 767 customers, including several of the Fortune 500 Companies. Your Company has 85 delivery centers and 49 sales offices spread over India & abroad.

In the fiscal year 2014-15 the Company''s consolidated revenues increased to Rs. 226,213 Million from Rs. 188,314 Million in the previous year, a growth of 20.1%. The growth during the year was led by acquisitions as well as organic growth. The geographic split of revenue was balanced with 47% share of Americas, 31% share of Europe, and 22% from Rest of the World.

The consolidated Profit before Interest, Depreciation, Tax and Exceptional Items was at Rs. 42,594 Million, against Rs. 42,968 Million in the previous year. The consolidated Profit after Tax, amounted to Rs. 26,277 Million as against Rs. 30,288 Million in the previous year.

The number of customers increased from 629 in the previous year to 767 at the end of fiscal year 2014-15.

In emerging areas of Big Data, Mobility Network, Cloud, Security, Platforms and Engineering Services, Tech Mahindra is well placed with its breadth of service offerings. Your company has also progressed well in building intellectual property through various Products & Services and Platforms. Your Company is committed towards building a synergistic relationship with its partners to enable, deliver, complete and customized solutions to customers. During the year, Tech Mahindra has developed an integrated program ''BROP'' (Building Relationships and Opportunities and Projects) program, which helps partner organizations and customers to succeed.

In summary, Tech Mahindra is well positioned in the markets it serves with a broad range of service offerings and a diversified customer base.

MERGER

During the year under review, the Scheme of Amalgamation and Arrangement between your Company and Mahindra Engineering Services Limited (MESL) got consummated on December 8, 2014. Subsequent to the Scheme of Amalgamation & Arrangement between MESL and Tech Mahindra Limited becoming effective, the Board of Directors fixed December 17, 2014 as the Record Date for MESL Shareholders for issue of Tech Mahindra Shares in the approved share swap ratio. This resulted in the issued capital of your Company going up from 236 Million shares to 240 Million shares. The shares swap got completed and the Stock Exchanges accorded their approval for trading of the new shares effective January 8, 2015.

ACQUISITIONS

Lightbridge Communications Corporation

Your Company acquired 100% shareholding of Lightbridge Communications Corporation (LCC), a Global Network service leader, through its wholly owned subsidiary Tech Mahindra Americas Inc. USA effective January 2, 2015. LCC is one of the world''s largest independent Global providers of Network Engineering Services to the Telecommunication industry.

The acquisition gives your Company an opportunity to offer full range of network services and integrated infrastructure solutions to both communication service providers as well as to the ecosystem of partners who cater to the communication sector. LCC has presence in over 50 countries. LCC has built 350 networks and designed more than 350,000 cell sites for over 400 customers worldwide.

Sofgen Holdings Limited

Your Company acquired 100% shareholding of SOFGEN Holdings Limited (SOFGEN), a niche consulting and Services Company with worldwide presence specializing in Private, Wealth, Commercial and Retail Banking solutions, with effect from March 13, 2015.

The acquisition gives your Company an opportunity to enhance expertise and to implement modernized Core Banking & Transformation services capabilities.

FixStream Networks Inc

The Company on 18th April, 2014 entered into an agreement to acquire majority stake (75%) in

FixStream Networks Inc (FSNI), a technology startup Company, and it has completed the acquisition on April 30, 2014.

Tech Mahindra Business Services GmbH

Tech Mahindra GmbH, a wholly owned subsidiary of the Company in Germany, entered into a share and asset purchase agreement with BASF Business Services Holding GmbH in February, 2014 for acquiring 100% stake in the equity of BASF Business Services holding GmbH (BASF). Upon payment of the consideration on July 29, 2014 the shares were transferred in the name of Tech Mahindra GmbH and its nominees were appointed on BASF''s Board of Directors. Subsequently, BASF''s name was changed in August 2014 to Tech Mahindra Business Services GmbH.

Complex IT

As you know your Company had acquired 51% stake in Complex IT one of the largest SAP consulting providers in Brazil through its wholly owned subsidiary Tech Mahindra Servicos De Informatica LTDA in May 2013. During the year under review, the balance stake of 49% in Complex IT Services was acquired. As at 31st March, 2015, Complex IT Services has become a 100% subsidiary of Tech Mahindra Servicos De Informatica LTDA, a wholly owned subsidiary of your Company in Brazil.

DETAILS OF SUBSIDIARY/JOINT VENTURES/ ASSOCIATE COMPANIES

As on 31st March, 2015, your Company has 149 Subsidiaries which includes 109 step-down subsidiaries and 4 Associate Companies. There has not been any material change in the nature of the business of the subsidiaries. As required under the Listing Agreements with the Stock Exchanges and the Companies Act, 2013, the Consolidated Financial Statements of your Company and all its subsidiaries are provided in this Annual Report. The Consolidated Financial Statements have been prepared in accordance with Accounting Standards AS 21, AS 23 and AS 27 issued by The Institute of Chartered Accountants of India and shown the financial resources, assets, liabilities, income, profits and other details of your Company and its subsidiaries and share in associate company as a single entity, after elimination of minority interest.

The performance and financial position of each of the subsidiaries, associate companies and joint venture companies included in the consolidated financial statement is provided in accordance with the provisions of Section 129 read with Rule 5 of the Companies (Accounts) Rules, 2014 as a separate statement annexed to the Notes on Accounts containing the salient features of the financial statement of Company''s subsidiaries/joint ventures or associate companies in Form AOC - 1.

Pursuant to Rule 8(5)(iv) of the Companies (Accounts) Rules, 2014, the names of the companies which have become or ceased to be the subsidiaries, joint ventures or associate companies during the year are provided in "Annexure I" to this report.

During the year the Board of Directors has formulated a policy for determining Material Subsidiaries. The policy is disclosed on the company''s website and is accessible on http://www.techmahindra.com/investors/ corporate governance.aspx

HUMAN RESOURCES

The ever dynamic technological landscape of today''s world makes it imperative for us to focus on continuously shaping our talent for tomorrow and delivering value to our customers through differentiated service offerings. Associates'' career development is therefore a key focus area at Tech Mahindra. We have an effective performance and career management process, 360 degree learning and focused leadership development programs to help associates grow in their careers. Our people practices have received recognition at national and global level, with ASTD (American Society for Training and Development) ranking us amongst the Top 5 organizations, globally, for learning practices as also, our Performance and Career Management practices being recognised amongst the Best Talent Management practices in Asia by L&OD Roundtable for the year 2014. We continued to focus on recognizing, rewarding and enabling higher performance amongst our Associates through various Recognition and Reward Mechanism.

The Company endeavours to create an environment that is encouraging for the associates to innovate and collaborate to leverage the collective knowledge of Tech Mighties. We provide a host of platforms to nurture innovation such as IRIS and the Intrapreneurship Program where associates have the opportunity to pursue their innovative ideas and even commercialize them with support from mentors and resources from within Tech Mahindra.

QUALITY

Your Company continues - to focus on quality and strives to exceed customer expectations at all times. The Company has been successfully assessed at CMMI Dev & SVC V1.3 L5, TMMi, TL9K, ISO 9001:2008, ISO 20000:2012, ISO 27001: 2005, AS9100 (Standard for Aerospace domain - scope of certification limited to the aerospace business within TechM). In addition to these, your Company has undergone SA800 certification, a Social Accountability Standard, for applicable accounts as per the contractual obligations and also maintains its commitment to health, safety and environment by continually improving its processes in accordance with ISO 14001 and OHSAS 18001 standards.

Your Company is also certified on ISO 22301:2012 (Societal Security) and has a comprehensive Business Continuity and Disaster Recovery framework, to prevent potential business disruptions in the event of any disaster. It can quickly resume services to customer''s acceptable service levels. Automated Service Desk with SLAs for enabling business and Vulnerability Assessment and Penetration Testing Lab for secured corporate network operations are highlights showcasing information security posture of the Organization.

These certifications are testimony of the robustness of business processes and at large the quality culture imbibed in the organization.

Your Company has also introduced high maturity practices to measure the effectiveness of the processes and manages them quantitatively. One such initiative is "Execution Excellence Index" focusing on achieving high project maturity, improved tools usage and standardization, knowledge management and performance on key business metrics, in order to strengthen further the Business Excellence in what the Company deliver to the customers. Your Company is putting all the initiatives in place in order to ensure that it delivers as stated in Quality Policy.

DIRECTORS

During the year under review there was no change in Directors of your Company.

Pursuant to the provisions of Section 152 (6) (c) of the Companies Act, 2013, Mr. Bharat N. Doshi, Director (DIN: 00012541) is liable to retire by rotation and does not offer himself for reappointment.

Mr. Bharat N. Doshi served on your Board since 6th June, 1997 as a Non - Executive Director. The Board places on record its appreciation for the valuable advice and guidance of Mr. Doshi during his tenure as a Director on the Board.

All Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Clause 49 of the Listing Agreement.

Board Evaluation

Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the Board has devised a policy on evaluation of performance of Board of Directors, Committees and Individual directors. Accordingly, the Chairman of the Nomination and Remuneration Committee obtained from all the board members duly filled in evaluation templates for evaluation of the Board as a whole, evaluation of the committees and peer evaluation. The summary of the evaluation reports were presented to the respective Committees and the Board for their consideration.

Policy on Directors Appointment and Remuneration

The Governance policies laid down by the Board of directors of your company include:

i. Policy on appointment and removal of Directors, Key Managerial Personnel and Senior Management

ii. Policy on remuneration to the Directors, Key Management Personnel and Senior Management and other Employees

The extract of these two policies are provided in "Annexure II".

Training

The Company has laid down a policy on training for Independent Directors, as part of the governance policies. The directors are updated on the regulatory changes, Business strategy and operations by the senior leadership of the Company periodically. Apart from this, during the year under review two external professionals provided orientation on latest trends in Cloud and Digital Businesses.

Key Managerial Personnel (KMPs)

Pursuant to provisions of Section 203 of the Companies

Act, 2013, Mr. Vineet Nayyar, Executive Vice Chairman, Mr. C. P. Gurnani, Managing Director & Chief Executive Officer, Mr. Milind Kulkarni, Chief Financial Officer and Mr. G. Jayaraman, Company Secretary are the Key Managerial Personnel of the Company.

DIRECTORS'' RESPONSIBILITY STATEMENT

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

i. in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

ii. they have, in the selection of the accounting policies, consulted the Statutory Auditors and these have been applied consistently and, reasonable and prudent judgments and estimates have been made so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2015 and of the profit of the Company for the year ended on that date;

iii. proper and sufficient care had been taken 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 other irregularities;

iv. the annual accounts have been prepared on a going concern basis;

v. they had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively;

vi. the proper systems to ensure compliance with the provisions of all applicable laws are in place and are adequate and operating effectively.

DETAILS IN RESPECT OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS

The Company has internal financial controls which are adequate and were operating effectively. The controls are adequate for ensuring the orderly & efficient conduct of the business, including adherence to the company''s policies, the safe guarding of assets, the prevention & detection of frauds & errors, the accuracy & completeness of accounting records and timely preparation of reliable financial information.

STATUTORY AUDITORS

M/s. Deloitte Haskins & Sells LLP, Chartered Accountants, [ICAI Registration No. 117366W/W-100018] the Auditors of your Company, hold office upto the conclusion of the forthcoming Annual General Meeting of the Company. Pursuant to provisions of Section 139(2) of Companies Act, 2013 read with Companies (Audit and Auditors) Rules, 2014, M/s. Deloitte Haskins & Sells LLP are eligible for appointment as Auditors. Your Company has received a written confirmation from M/s. Deloitte Haskins & Sells LLP, Chartered Accountants to the effect that their appointment, if made, would satisfy the criteria provided in Section 141 of the Companies Act, 2013 for their appointment. The Board recommends the appointment of M/s. Deloitte Haskins & Sells LLP, Chartered Accountants as the Auditors of the Company from the conclusion of the ensuing AGM to the conclusion of the next AGM.

The information and explanations on the qualification contained in the Auditors'' report are provided in detail in the Note 26.3 forming part of the financial statements. Your board opines that no further explanation is required in this regard.

SECRETARIAL AUDIT REPORT

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 had appointed Dr. K. R. Chandratre, Practicing Company Secretary, Pune to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is provided as "Annexure III". There are no qualifications, reservation or adverse remark or disclaimer made in the Secretarial Audit Report.

EXTRACT OF THE ANNUAL RETURN

Pursuant to the provisions of Section 134(3)(a) of the Companies Act, 2013, the extract of the Annual Return in Form MGT-9 is attached as "Annexure IV".

MANAGERIAL REMUNERATION

Disclosures of the ratio of the remuneration of each director to the median employee''s remuneration and other details as required pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is provided as "Annexure V".

None of the directors who are in receipt of any commission from the Company and Managing Director or Whole-time Director of the Company, shall receive any remuneration or commission from any Subsidiary Company of your Company.

The details of remuneration paid to the Directors including Executive Directors of the Company are given in Form MGT-9 forming part of the Directors Report.

PARTICULARS OF EMPLOYEES

The information required under Section 197(12) of the Companies Act, 2013 ("the Act") read with Rule 5(2) & (3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms part of this Report. However, pursuant to first proviso to Section 136(1) of the Act, this Report is being sent to the Shareholders excluding the above said information. Any shareholder interested in obtaining this Report, may write to the Company Secretary at the Registered Office / Corporate Office of the Company.

Anti Sexual Harassment Policy

Your Company laid down Anti Sexual Harassment policy and it is made available on the website of the Company. The Company has zero tolerance on Sexual Harassment at workplace. During the year under review there were no cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

EMPLOYEE STOCK OPTION PLANS

Details as required under Rule 12 (9) of Companies (Share Capital and Debentures) Rules, 2014 and as required to be provided under the Securities and Exchange Board of India Guidelines as on March 31, 2015 are set out in "Annexure VI" to this Report.

CORPORATE GOVERNANCE

A report on Corporate Governance covering among others details of meetings of the Board and Committees along with a certificate for compliance with the Clause 49 of the Listing Agreement issued by the statutory auditors of the Company, forms part of this Annual Report.

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.

RISK MANAGEMENT

During the year, your Company had constituted a Risk Management Committee and approved detailed framework for Risk Management. The details of Committee and its terms of reference including elements of risk as identified for the Company are set out in the Corporate Governance Report and Management Discussion and Analysis Report (MDA) forming part of the Board''s Report.

ESTABLISHMENT OF VIGIL MECHANISM

Your Company has laid down Whistle Blower Policy covering Vigil Mechanism with protective Clauses for the Whistle Blowers. As part of the Vigil Mechanism a dedicated telephone line and email address are provided. The Whistle Blower Policy is made available on the website of the Company.

DEPOSITS / LOANS & ADVANCES, GUARANTEES OR INVESTMENTS

Your Company has not accepted any deposits from the public during the year under review. The particulars of loans/advances, guarantees and investments under Section 186 of the Companies Act, 2013 and as per Clause 32 of the Listing Agreement are given in the notes forming part of the Financial Statements.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All transactions entered into with Related Parties as defined under Section 2(76) of the Companies Act, 2013 and Clause 49(VII) of the Listing Agreement during the financial year were in the ordinary course of business and on an arm''s length pricing basis and do not attract the provisions of Section 188 of the Companies Act, 2013. There were no materially significant transactions with related parties in the financial year which were in conflict with the interest of the Company and requiring compliance of the provisions of revised Clause 49 of the Listing Agreement. Suitable disclosure as required by the Accounting Standards (AS18) has been made in the notes forming part of the Financial Statements.

The Company has formulated a policy on materiality of Related Party Transactions and dealing with Related Party Transactions which has been uploaded on the Company''s website and can be accessed at http://www.techmahindra.com/sites/ResourceCenter/ Brochures/investors/corporategovernence/RPT Policy Amended.pdf

The particulars of related party transactions in prescribed Form AOC - 2 is attached as "Annexure VII".

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars as prescribed under Section 134(3) (m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 are provided in "Annexure VIII" which forms part of this report.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

The CSR vision of your Company is "Empowerment through Education."

In compliance with the guidelines prescribed under Section 135 of the Companies Act, 2013, your company constituted a Corporate Social Responsibility (CSR) Committee. Your Board of Directors laid down CSR Policy, covering the Objectives, Focus Areas, Governance Structure and Monitoring & Reporting Framework among others and the policy is available at http://www.techmahindra.com/society/default.aspx.

Your company''s social initiatives are carried out by Tech Mahindra Foundation and Mahindra Educational Institutions.

- TECH MAHINDRA FOUNDATION (TMF)

The Tech Mahindra Foundation, the CSR arm of the Company, established in 2007 as a Section 25 Company, works towards a stated mission: "Educated, skilled and able women and men are a country''s true strength".

During the year under review, Tech Mahindra Foundation expanded its operations to two more locations, upscaling its presence to nine states/ union-territories through ten India Chapters - Bengaluru, Bhubaneswar, Chandigarh, Chennai, Delhi-NCR, Hyderabad, Kolkata, Mumbai, Pune and Visakhapatnam. The Foundation ran 135 high-impact projects with 90 partners, reaching out to 125,000 children and youth across these locations.

School Education

The Foundation''s work in school education focuses upon three thematic areas: school improvement, teacher empowerment and learning enrichment. The key initiatives include:

All Round Improvement in School Education (ARISE):

Tech Mahindra Foundation''s educational initiatives under ARISE are long-term school improvement programmes, run in partnership with local governments and partner organisations. The Foundation has adopted 55 schools across India and is working with 18 partners to turn them around completely into model schools of excellence. ARISE initiatives encompass educational empowerment programmes for children with disabilities.

Shikshaantar:

Shikshaantar, envisioned for creating a difference to education, describes the Foundation''s teacher empowerment and system enhancement programme. Another aspect of Shikshaantar is felicitating outstanding teachers of municipal schools of Delhi through the Foundation''s flagship Shikshak Samman Award programme.

Shiksha Samvardhan:

Shiksha Samwardhan, or the education enrichment programme, is a thematic intervention around learning enhancement initiatives of the Foundation, towards making learning interesting, child-centred and activity-based to reduce cumulative burden of non-comprehension and to promote grade- appropriate competencies.

Employability:

Skills for Market Training (SMART) is the Foundation''s flagship programme in employability. It is built on the vision of an educated, enlightened and employed India, and a belief that educated and skilled youth are the country''s true strength. The programme started with 3 Centres in 2012 and is currently running 65 Centres at 10 locations across India. These include SMART Centres, SMART Centres (training for people with disabilities), SMART-T Centres (training in technical trades) and the SMART Academy. The Academy will closely engage with the industry stalwarts for constant curriculum up- gradation and placement.

During the year under review, your Company trained ~12,000 young women and men under its SMART programme. More than 75-80% of the graduates are placed in jobs upon successful completion of the training, across multiple industries.

- MAHINDRA EDUCATIONAL INSTITUTIONS: TECHNICAL EDUCATION

Your Company''s initiatives in technical education are carried out through Mahindra Educational Institutions (MEI), under which the Foundation has extended infrastructural and operational support to Mahindra Ecole Centrale, a state- of-the-art technical institution in Hyderabad. The institution offers a four year B Tech Programme in association with Ecole Centrale, Paris under an industry-academia memorandum of understanding with Jawaharlal Nehru Technological University, Hyderabad.

The institution''s vision is to train engineers, to be entrepreneurial and innovative as well as technically trained, so that they are capable of meeting the greatest challenges of the era. It is aligned to MEI''s work for the cause of promoting quality higher education by establishing institutions of higher learning, encourage education and research work in different disciplines and to promote innovation and technology development.

The Annual Report on CSR activities is provided as "Annexure IX".

SUSTAINABILITY

Your Company believes in business growth with responsibility. The Company has taken many steps strategically leveraging sustainability to its competitive advantage. Your Company has created "Green" strategies to identify high impact material issues across the social, economic and environmental dimensions and concentrate individually on each one of them with a sole goal of a sustainable business model creating value for all stakeholders. The Company''s initiatives aligning economic performance with environmental & social operations has ensured that business growth would not affect the future of our society, its ecological balance and life support functions.

Tech Mahindra has been publishing its sustainability performance since 2007-08 as part of the Mahindra Group Sustainability Report. The detailed Reports are available on the website http://www.mahindra.com/ How-We-Help/Environment/Sustainability-Reports

With emerging sustainability awareness in the market we have taken 3 year comprehensive targets against each of the material issues identified which are critical to business operations such as Improving Operational Eco-Efficiency, Associate Care & Development, Creating a Green Value Chain & Societal Care.

Tech Mahindra has managed environmental footprint essentially through a process which addresses issues ranging from Emission Reduction to Water Management and Green Infrastructure. There are also services and solutions for the customers such as bringing data center efficiency, platforms mobility and cloud services.

The Company has continuously striven to fine tune processes and systems in order to identify, quantify and reduce the environmental impacts of businesses and operations. Our efforts can be seen with the efforts put in across various areas in Sustainability Recognitions & Awards bestowed on the Company during the Financial Year 2014-15, mentioned elsewhere under Awards & Recognitions heading separately. During the year under review, efforts were made among others in the following areas:

- Occupancy sensors to reduce the electricity consumption.

- Wealth of Wellness initiative for associate wellbeing.

- Successful commissioning of solar plants at Pune (250kWh) & Chennai (264 kWh) campuses.

- Participation in Carbon Disclosure Project''s Supply Chain Program-2014.

- Focused approach towards green solutions for clients that has helped the Company to reduce 5756 metric tonnes carbon emissions per annum.

- The suite of cloud based solutions & platforms of the Company, have showcased benefits in not only better performance but also how they consume less electricity.

AWARDS AND RECOGNITION

Your Company continued its quest for excellence in its chosen area of business to emerge as a true global brand. Several awards and rankings continue to endorse your Company as a thought leader in the industry. The awards / recognitions received during the year 2014-15 include:

- Ranked 5th in IT and Software ranking by DUN and Bradstreet;

- Digital Humanitarian Award at TMF World 2014 for deploying Women Safety Mobile Application Fightback;

- Porter prize in recognition of company''s best strategic management practices;

- Businessworld identified Tech Mahindra among the fastest growing companies in India based on financial performance;

- Featured in FINTECH TOP 25 rankings for the year 2014 by IDC Financial Insights;

- The Association for Talent Development has ranked Tech Mahindra as the Top 5 BEST Organization across the globe for employee learning and talent development;

- European Software Testing Awards (TESTA), in the following categories, namely;

i) ''The Sogeti Green Testing Team of the Year''.

ii) ''Best Overall Use of Technology''.

iii) ''The Sage Most Innovative Project''.

- Business Today ranked among the top 50 companies in India''s most valuable companies ranking.

- Mr. C. P. Gurnani recognized as the CEO of the Year 2014 by Business Standard;

- Tech Mahindra Foundation (TMF) was awarded Pandit Madan Mohan Malviya Award for ''Best CSR Practices in Education'' by CSR Times;

- Mr. C. P. Gurnani, Managing Director and CEO, has been recognized as the ''Business Leader of the Year for Indian Companies in the US'' by Indo- American Chamber of Commerce (IACC);

- ''Golden Peacock Award for Excellence in Corporate Governance'' from Institute of Directors;

- The Business Services Group of the Company, has been declared as the Winner of ''Golden Peacock National Quality Award'' for the year 2014;

ACKNOWLEDGEMENTS

Your Directors place on record their appreciation for the contributions made by employees towards the success of your Company. Your Directors gratefully acknowledge the co-operation and support received from the shareholders, customers, vendors, bankers, regulatory and Governmental authorities in India and abroad.

For and on behalf of the Board

Place: Mumbai Anand G. Mahindra

Date : May 26, 2015 Chairman


Mar 31, 2013

To, The members of Mahindra & Mahindra Financial Services Limited

The Directors are pleased to present their Twenty-third Report together with the audited accounts of your Company for the Financial Year ended 31st March, 2013. The summarised financial results of the Company are given below:

FINANCIAL RESULTS (Rs. in Crores)

March 2013 March 2012

Total Income 3,894.7 2,794.6

Less : Finance Costs 1,618.8 1,120.3

Expenditure 1,003.1 729.5

Depreciation/Amortisation 22.2 19.6

Total Expenses 2,644.1 1,869.4

Profit Before Tax and Exceptional Item 1,250.6 925.2

Add: Exceptional Item 28.6 0.0

Profit Before Tax 1,279.2 925.2

Less : Provision For Tax

Current Tax 433.5 289.6

Deferred Tax (37.0) 15.5

Profit After Tax for the Year 882.7 620.1

Add : Amount brought forward from Previous Years 979.8 713.5

Amount available for Appropriation 1,862.5 1,333.6

Appropriations

General Reserve 88.3 62.0

Statutory Reserve 176.5 124.0

Proposed Dividend on Equity Shares 204.8 145.6

Income-tax on proposed Dividend 34.1 22.6

Excess provision for Corporate Dividend Tax on Equity Shares 0.0 (0.4) of earlier year

Surplus carried to Balance Sheet 1,358.8 979.8

DIVIDEND

Your Directors are pleased to recommend a dividend of Rs. 3.60 per Equity Share of the face value of Rs. 2 each (including a special dividend of Re. 0.20 per Equity Share), payable to those Members whose names appear in the Register of Members as on the Book Closure date. The dividend including dividend tax will absorb a sum of Rs. 238.9 Crores (as against Rs. 168.2 Crores on account of dividend of Rs. 14 per Equity Share of the face value of Rs.10 each, paid for the previous year).

OPERATIONS

The overall disbursement registered a growth of 22.2 per cent at Rs. 23,838.6 Crores as compared to Rs. 19,504.3 Crores in the previous year. Your Company during the year under review, continued to provide a wide range of financial products and services to its customers through diversification of its product portfolio within its vehicle financing business as well as through the introduction and growth of other financial products and maintained its market leadership position in rural and semi-urban markets.

Your Company has increased its presence in financing of commercial vehicle, construction equipment, as well as, pre-owned vehicle while maintaining aggressive growth in car financing, retaining its leadership position in financing Mahindra range of vehicles and tractors in addition to extending its lending to vehicles of other Original Equipment Manufacturers (OEMs).

Your Company has one of the largest network of branches amongst Non-Banking Financial Companies operating in rural and semi-urban areas. Your Company''s nationwide network of branches and locally recruited employees have facilitated in enhancing and strengthening long-term relationship with its customers.

During the year under review, your Company expanded its reach in the Micro Small and Medium Enterprises (MSME) segment as well as continued to explore the opportunities in the emerging Gold Loan industry in India.

Income grew by 39.4 per cent to Rs. 3,894.7 Crores for the year ended 31st March, 2013 as compared to Rs. 2,794.6 Crores for the previous year. Profit Before Tax was 38.3 per cent higher at Rs. 1,279.2 Crores as compared to Rs. 925.2 Crores for the previous year. Profit After Tax grew at a healthy rate of 42.4 per cent to Rs. 882.7 Crores as compared to Rs. 620.1 Crores in the previous year.

Your Company has cumulatively financed over two and a half million customers since its inception. The number of contracts entered into by the Company during the year was 5,33,134 as against 4,66,416 in the previous year.

During the year under review, the Assets Under Management have crossed Rs. 27,000 Crores and stood at Rs. 27,913 Crores as at 31st March, 2013.

DISTRIBUTION OF MUTUAL FUND PRODUCTS

During the year under review, the activity of distribution of Mutual Fund Products (MFP) was carried out across 152 branches covering 19 States.

As on 31st March, 2013, the amount of Assets Under Management outstanding through the Company''s Advisory Services on MFP, aggregate of institutional and retail segment, was Rs. 1,109 Crores and the number of clients stood at 41,023.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

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

CORPORATE GOVERNANCE

Your Company practices a culture that is built on core values and ethical governance practices and is committed to transparency in all its dealings. A Report on Corporate Governance along with a Certificate from the Statutory Auditors of the Company regarding the compliance of conditions of Corporate Governance as stipulated under Clause 49 of the Listing Agreement are annexed to this Report.

ECONOMY

In the current year the global economy continued to witness sluggish growth. Overall growth at 3 per cent was 0.5 per cent lower compared to the pre- crisis levels in 2008. While the US grew at better than expected levels, the entire Euro Zone was lurching from one crisis to another. Apart from the financial crisis staring at the PIIGS (Portugal, Italy, Ireland, Greece and Spain) countries, major economies like Germany and France experienced low growths. European Central Bank''s attempts to kickstart the economy through its own version of quantitative easing did not yield the desired results and more steps would be required to reignite the growth. The implementation of the Basel III guidelines would cause the European Banks to deleverage. This might affect the capital flows to the emerging markets and the consequent liquidity crunch would lead to a possible hike in interest rates.

Against the backdrop of an adverse global environment and a spiraling current account deficit, India''s growth slowed down significantly. GDP growth for the Financial Year 2012-13 is expected to be around 5 per cent, the slowest growth in more than a decade. While there was a slowdown across the entire economy, it was more pronounced in the industrial sector. Low capex by the corporate sector as a result of uncertain policy environment and delay in key approvals was the primary reason behind this. Inflation, an area of significant concern of the Reserve Bank of India (RBI), eased considerably in the latter part of the year and was 5.96 per cent in March 2013. Despite the easing of inflation the RBI adopted a conservative approach and reduced the rates by only 25 basis points in March 2013.

Liquidity remained under pressure throughout the year because of persistently high government cash balances with RBI and elevated incremental credit to deposit ratio for significant part of the year. The net average liquidity injection under the daily liquidity adjustment facility (LAF) at Rs. 730 billion during the first half of the year, increased significantly to Rs. 1,012 billion during the second half. In order to alleviate liquidity pressures, RBI lowered the Cash Reserve Ratio (CRR) cumulatively by 75 basis points on three occasions and the statutory liquidity ratio (SLR) by 100 basis points during the year. Additionally, RBI injected liquidity to the tune of Rs. 1.5 trillion through Open Market Operations (OMO) purchase auctions.

Against this back drop of sharp decline in the GDP growth and moderation in headline WPI inflation, the stance of the RBI Monetary Policy is intended to appropriately manage liquidity to ensure adequate flow to the productive sectors of the economy, guard against the risk of inflation pressures re-emerging and continue to address risks to growth.

While the overall economy decelerated significantly, the rural and semi-urban markets, the focus areas of the Company, witnessed higher growth. The governmental thrust on rural areas through programmes like MGNREGA, high agri commodity prices, etc., led to an increase in disposable income thereby leading to a robust demand for various products and services. Consequently, there was enhanced demand for vehicles in these geographies. With broad-basing of economic activities in the rural areas and the governmental thrust on rural infrastructure, it is expected that rural India will continue to grow rapidly in the next year.

FINANCE

During the year under review, RBI shifted its stance from an inflation focused to an accommodating growth focused policy and reduced the Repo Rate three times totalling to 100 basis points to contain the increasing risk to the growth, which resulted in medium/long term interest rates coming-off approximately by 50 basis points. RBI has clearly indicated that even as the policy stance emphasises addressing the growth risk, the headroom for further monetary easing remains quite limited. Liquidity conditions remained in a deficit mode throughout the year. In order to mitigate the liquidity tightness, RBI conducted OMOs and reduced CRR by 75 basis points during the last year. However, your Company was able to reduce the impact of volatility in the interest rates by ensuring that prudent Asset Liability Management Guidelines were adhered to.

During the year under review, your Company continued with its diverse methods of sourcing funds in addition to regular borrowings like Secured and Unsecured Debentures, Term Loans, Commercial Paper, etc., and maintained prudential Asset/ Liability match throughout the year. Your Company sourced long term loans from banks at attractive rates. Your Company also issued Subordinated Debt amounting to Rs. 115 Crores and successfully completed five securitisation transactions (at par structure) amounting to Rs. 1,433.6 Crores.

During the year, your Company actively participated in a number of investor meets both in India and abroad organised by reputed Global and Domestic Broking Houses. Your Company also periodically conducted analysts'' meets and conference calls to communicate details of performance, important developments and exchange of information.

SHARE CAPITAL

Qualified Institutions Placement

On 16th November, 2012, your Company successfully concluded the Qualified Institutions Placement (QIP) issue to Qualified Institutional Buyers aggregating Rs. 866.80 Crores through the issue of 97,50,257 Equity Shares of the Face Value of Rs. 10 each at a price of Rs. 889 per Equity Share including a premium of Rs. 879 per Equity Share, which is a 0.94 per cent premium to the price of Rs. 880.70 per share, arrived at as per Regulation 85 of Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009.

The Company received bids of approximately Rs. 4,345 Crores. Despite it being launched in markets clouded by bearish sentiments, the second QIP offering by your Company received an overwhelming response, as seen by the high levels of subscription and strong participation from International and Domestic Institutional Investors.

Your Company has duly utilised the issue proceeds to augment its capital base, meet its capital requirements, for other general corporate purposes and for payment of Issue Expenses. This is in line with the issue purpose mentioned in the Placement Document filed with various Regulatory Authorities.

Sub-Division ("Stock-Split") of Face Value of Equity Shares

Pursuant to the approval received from the Members of the Company by way of Postal Ballot on 5th February, 2013, your Company has on 19th February, 2013, upon sub-division, issued 5 (Five) Equity Shares of Rs. 2 each fully paid-up in the Equity Share Capital of the Company for every 1 (One) Equity Share of the face value of Rs. 10 fully paid-up held by the Members in the Equity Share Capital of the Company as on the Record Date i.e. 18th February, 2013.

Post allotment of Equity Shares and sub-division of Equity Shares as aforesaid, the issued, subscribed and paid-up Share Capital of the Company stands at Rs. 113.8 Crores comprising of 56,87,64,960 Equity Shares of Rs. 2 each fully paid-up and the Authorised Share Capital of the Company stands at Rs. 190 Crores comprising of 70,00,00,000 Equity Shares of Rs. 2 each and 50,00,000 Redeemable Non-Convertible Preference Shares of Rs. 100 each. Consequent to the Stock-split, a new International Securities Identification Number (ISIN) INE774D01024 has been created by the Depositories for the Company''s Equity Shares of the face value of Rs. 2 each.

CAPITAL ADEQUACY

Consequent upon the allotment of Equity Shares to the Qualified Institutional Buyers under the Qualified Institutions Placement, the paid-up share capital of the Company has increased to Rs. 113.8 Crores as on 31st March, 2013 from Rs. 104.0 Crores as on 31st March, 2012. The securities premium account has also increased to Rs. 2,014.5 Crores from Rs. 1,165.3 Crores. As a result of the increased net worth, your Company was able to enhance the Capital to Risk Assets Ratio (CRAR) to 19.7 per cent as on 31st March, 2013, which is well above 15.0 per cent CRAR prescribed by RBI.

HOLDING COMPANY

Pursuant to the allotment of Equity Shares to the Qualified Institutional Buyers under the Qualified Institutions Placement, the shareholding of Mahindra & Mahindra Limited, the holding company, stands reduced to 51.2 per cent from 56.0 per cent.

STOCK OPTIONS

During the year under review, no new Options have been granted under the ''Mahindra & Mahindra Financial Services Limited Employees'' Stock Option Scheme-2005'' and ''Mahindra & Mahindra Financial Services Limited Employees'' Stock Option Scheme-2010'' respectively.

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

RBI GUIDELINES

The Company has complied with all the applicable regulations of the Reserve Bank of India (RBI). As a prudent practice, your Company makes accelerated provisioning for Non-Performing Assets (NPAs) than that required by RBI for NBFCs.

Standard Assets'' Provisioning

Pursuant to the Notification No. DNBS.222/CGM (US)-2011 dated 17th January, 2011 issued by the RBI for making a general provision at 0.25 per cent on the outstanding standard assets of NBFCs, your Company has made a provision of Rs. 16.0 Crores as at 31st March, 2013, towards the same. With effect from the current year, the Company has, on a prudent basis, decided to make additional/ accelerated general provision on its standard assets and has provided Rs. 36.0 Crores for the same which is reflected as "Exceptional Items" in the Statement of Profit and Loss.

CREDIT RATING

During the year under review, CRISIL Limited [CRISIL], has reaffirmed the rating to the Company''s Long-term Debt Instruments and Bank Facilities as ''CRISIL AA / Stable'' and the Company''s Fixed Deposit Programme as ''FAAA/Stable'', respectively. The ''AA /Stable'' rating indicates a high degree of safety with regard to timely payment of financial obligations. The rating on the Company''s Short-term Debt and Bank Loans has been reaffirmed at ''CRISIL A1 '' (earlier P1 ) which is the highest level of rating.

During the year under review, India Ratings & Research Private Limited, which is part of the Fitch Group, has reaffirmed the Company''s National Long-term Rating Instrument and Lower Tier II Subordinated Debt programme to ''IND AA /Stable''. The ''IND AA'' denotes that Instruments with this rating are considered to have high degree of safety regarding timely servicing of financial obligations. Such instruments carry very low credit risk. Modifiers {" " (plus) / "-" (minus)} can be used with the rating symbols for the categories ''IND AA'' to ''IND C''. The modifiers reflect the comparative standing within the category.

Brickwork Ratings India Private Limited has, during the year, re-affirmed the ''BWR AA '' rating with Positive outlook to the Company''s Long-term Subordinated Debt Issue. ''BWR AA '' stands for an instrument that is considered to offer high credit quality/safety in terms of timely servicing of principal and interest obligations.

FIXED DEPOSITS AND LOANS/ADVANCES

As on 31st March, 2013, your Company has mobilised funds from Fixed Deposits to the tune of Rs. 2,327.9 Crores, with an investor base of over 1,52,553 investors.

Your Company has initiated various measures towards improvement of service levels to the Fixed Deposit holders. As a customer-centric process, the Company has initiated the process of online repayment directly to the customer''s account on maturity of the Fixed Deposit. In cases where electronic transfer facility is not available, the repayment is made through a post-dated cheque sent before the maturity date to the depositors. Your Company has also launched across-the-counter facility at its Corporate Office Annexe, to issue Fixed Deposit Receipts promptly to its customers and the same is expected to be implemented across its branches shortly.

As at 31st March, 2013, 1,224 deposits amounting to Rs. 6.8 Crores had matured for payment and remained unclaimed. The unclaimed deposits have since reduced to 809 deposits amounting to Rs. 4.4 Crores.

The particulars of loans/advances and investment in its own shares by listed companies, their subsidiaries, associates, etc., required to be disclosed in the Annual Accounts of the Company pursuant to Clause 32 of the Listing Agreement are furnished separately.

SUSTAINABILITY INITIATIVES

Your Company has been way ahead in the Financial Services Sector in India to protect and sustain the rural livelihoods through a sustainable business model. The business model aims at transforming rural lives and driving positive change in the community. From the Financial Year 2008-09 onwards, your Company has taken steady but impactful steps towards sustainability by charting out a roadmap of five years on Triple bottom line for balanced approach towards economic activity, environmental responses and social progress. Your Company''s Sustainability Report continues to attain ''A '' rating from Global Reporting Initiative (GRI).

Your Company continued with its focus on sustainability awareness for employees, vendors, suppliers and customers and took various initiatives in this direction. Your Company made proactive efforts to fight against global warming through Project ''Mahindra Hariyali'', by planting around 54,000 saplings across the country. Various initiatives were also taken for conservation of water and energy, reduction of noise pollution and paper consumption. Along with this your Company has also started reporting on Carbon Disclosure Project (CDP) from the Financial Year 2011-12. CDP focuses on how companies are geared up, to deal with the challenges of Climate change in a carbon constrained economy. CDP works for 655 institutional investors with $78 trillion under management.

CORPORATE SOCIAL RESPONSIBILITY INITIATIVES

As a socially responsible citizen, the Mahindra Group, through its various Corporate Social Responsibility (CSR) initiatives, is enabling entire communities to ''RISE''. Rise is a symbol of the Mahindra Group''s dedication to continual improvement within itself and in the Communities the Group touches. CSR continues to be an integral part of the vision of the Mahindra Group and this year too, your Company has pledged 1 per cent of its Profit after Tax for CSR initiatives, largely to benefit the economically weaker and socially disadvantaged sections of the Society and has continued to be incessantly engaged in activities, which add value to the community around it.

As a part of its commitment to Corporate Social Responsibility initiatives, your Company, during the year continued to involve itself in social welfare activities by contributing to recognised charitable institutions, which specifically benefit the economically weaker sections of the society as well as extended its support to Nanhi Kali, the flagship programme of the K.C. Mahindra Education Trust, which supports the education of the disadvantaged girl child.

During the year under review, your Company organised a nationwide Blood Donation Drive to re- affirm its pledge to the society and collected 1,084 bottles of blood. Your Company also conducted a cancer detection camp in the interior areas of Dharward. The ''Lifeline Express'' Train, in association with Impact India, catered to the medical needs of 2,550 underprivileged people in Puri (Odhisha). Your Company also donated funds for the purchase of 4 ambulances, 3 DG sets and Palliative Care Unit equipment to numerous charitable institutions. The Company also took a step in lighting up the lives of the people in the interior locations of Tamil Nadu by installing 165 Solar Street Lights.

During the year under review, your Company contributed Rs. 5.7 Crores towards Corporate Social Responsibility to various institutions for charitable purposes.

ACHIEVEMENTS

During the year under review, your Company was featured in the ET 500 ''Star Trek : The Dazzling Dozen'' as well as in the ET 500 2012 ''India''s Biggest 500 Companies''. Your Company was also awarded the inaugural Porter Prize for creating Distinctive Value, the NASSCOM IT User Awards 2012, the EDGE Award 2012 for best use of Technology, the Silver Award 2012 for Best Corporate Website from ABCI (Association of Business Communicators of India), eOdisha Awards 2013 for Information and Communication Technologies in Financial Inclusion Initiative, Asian Leadership Awards 2012 for best use of IT in Investment Banking by the Asian Confederation of Businesses and the First Runner-up Trophy in the NBFCs - Asset Backed Lending category at the Best Bank & Financial Institution Awards 2012 by CNBC TV18.

Your Company has won the Golden Peacock HR Excellence Awards 2012 and was also awarded the Commendation Certificate for ''Strong Commitment to HR Excellence'' in the 3rd National HR Excellence Awards by the Confederation of Indian Industry. The Company was ranked 5th in the Financial Services Sector by the Great Places to Work Institute and was also included in the Top 80 Indian Power Brands. Your Company was also conferred with 6 PRCI Annual Corporate Collateral Awards 2012 by the Public Relations Council of India (PRCI) as well as adjudged the First Runner-up at the Best Learning Organisation of Asia Awards by the L&OD Round Table, 2012.

DIRECTORS

Mr. Bharat Doshi, Chairman and Mr. Dhananjay Mungale, Independent Director, retire by rotation at the forthcoming Annual General Meeting and, being eligible, offer themselves for re-appointment.

DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to section 217(2AA) of the Companies Act, 1956, your Directors, based on the representation received from the Operating Management, and after due enquiry, confirm that:

i) in the preparation of the annual accounts, the applicable accounting standards have been followed;

ii) they have, in the selection of the accounting policies, consulted the Statutory Auditors and these have been applied consistently and reasonable and prudent judgments and estimates have been made so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2013 and of the profit of the Company for the year ended on that date;

iii) proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

iv) the annual accounts have been prepared on a going concern basis.

SUBSIDIARY COMPANIES

Mahindra Insurance Brokers Limited

MIBL has crossed the 8,00,000 mark in terms of policies serviced, with a total of 8,39,408 policies for both Life and Non-Life retail business lines, for the year ended 31st March, 2013. The customised Life insurance cover "Mahindra Loan Suraksha" (MLS) continued to receive an encouraging response and grew by 21 per cent from 3,63,691 lives covered with a Sum Assured of Rs. 8,255.0 Crores in the financial year 2011-12 to 4,40,553 lives covered with a Sum Assured of Rs. 11,798.2 Crores in the financial year 2012-13, with a substantial portion being covered in the rural markets.

MIBL achieved a growth of 33.8% in Net Premium generated for the Corporate and Retail business lines, increasing from Rs. 413.8 Crores (Gross Premium Rs. 456.2 Crores) in the financial year 2011-12 to Rs. 553.8 Crores (Gross Premium Rs.619.8 Crores) in the financial year 2012-13, crossing a milestone of Rs.600 Crores of Gross Premium.

The Income increased by approximately 85 per cent from Rs. 46.6 Crores in the financial year 2011-12 to Rs. 86.3 Crores in the financial year 2012-13. The Profit before Tax increased by 154.2 per cent from Rs. 20.1 Crores to Rs. 51.2 Crores, and the Profit after Tax increased by 155 per cent from Rs. 13.5 Crores to Rs. 34.5 Crores during the same period.

During the year under review, MIBL has entered into Definitive Agreements with Inclusion Resources Private Limited (IRPL), a subsidiary of LeapFrog Inclusion Fund (LFIF), incorporated in Singapore and the Company, to expand MIBL''s services to consumers in rural and semi-urban areas of India, by bringing in IRPL''s international knowledge and experience, especially in using low cost technology solutions to provide insurance in mass markets. In addition, given IRPL''s expertise and association in reinsurance globally, IRPL would help MIBL to connect with various global reinsurers to assist in MIBL''s reinsurance broking business.

During the year under review MIBL has received the necessary approvals from the Insurance Regulatory and Development Authority, the Foreign Investment Promotion Board as well as the Reserve Bank of India and the Company has in pursuance of the aforesaid Definitive Agreements, sold 3,09,278 Equity Shares of Rs. 10 each of MIBL to IRPL, for an amount aggregating Rs. 64.3 Crores, vide issue of transfer instruction dated 30th March, 2013. On account of a technical issue raised by the Depository Participant of IRPL, the actual transfer of 309,278 Equity Shares on sale by the Company from the demat account of the Company, was recorded in the demat account of IRPL on 2nd April, 2013, being the next working day. MIBL has also made a preferential allotment to IRPL of 77,320 Equity Shares of Rs. 10 each for cash at a premium of Rs. 2,070 per share aggregating to Rs. 16.1 Crores.

Pursuant to the preferential allotment and transfer of Equity Shares to IRPL, the shareholding of the Company in MIBL stands reduced to 85 per cent from 100 per cent and hence MIBL has ceased to be a wholly-owned subsidiary of the Company.

Mahindra Rural Housing Finance Limited

Mahindra Rural Housing Finance Limited (MRHFL) has during the year ended 31st March, 2013, disbursed loans aggregating Rs. 432.9 Crores (previous year Rs. 266.8 Crores), covering over 61,000 families. The profit after tax for the year ended 31st March, 2013 is Rs. 20.3 Crores (previous year Rs. 11.9 Crores). The outstanding loan portfolio as at 31st March, 2013 stood at Rs. 879.5 Crores.

The housing loans sanctioned during the year ended 31st March, 2013 were to the extent of Rs. 541.0 Crores as against Rs. 292.2 Crores sanctioned during the previous year. The cumulative loan sanctions of MRHFL as at the end of financial year 2012-13 were Rs. 1,253.3 Crores as compared to Rs. 718.4 Crores in the previous year. The cumulative loan disbursement at the end of the year stood at Rs. 1,040.5 Crores as compared to Rs. 607.4 Crores in the previous year.

MRHFL has been expanding its geographical presence, especially to provide affordable services for rural households. During the year under review, operations were strengthened in the states of Maharashtra, Gujarat, Rajasthan, Tamilnadu, Andhra Pradesh, Kerala, Karnataka, Madhya Pradesh and Bihar.

Mahindra Business & Consulting Services

Private Limited

Mahindra Business & Consulting Services Private Limited (MBCSPL) provides staffing services mainly for your Company and its subsidiaries viz. MIBL and MRHFL and the ultimate parent company, viz. Mahindra & Mahindra Limited. As at 31st March, 2013, MBCSPL had on rolls 8,098 employees who were deputed to these companies to provide services under ongoing contracts. MBCSPL earns its income in the form of fees towards staffing services. MBCSPL registered a Profit after Tax of Rs. 173.79 Lacs for the year ended 31st March, 2013 as compared to Rs. 7.06 Lacs in the previous year.

The Statement pursuant to section 212 of the Companies Act, 1956, containing details of the Company''s subsidiaries is attached. In accordance with the General Circular No. 2/2011 dated 8th February, 2011 issued by the Ministry of Corporate Affairs, Government of India, the Balance Sheet, Statement of Profit and Loss and other documents of the subsidiary companies are not being attached to the Balance Sheet of the Company.

The Company will make available the Annual Accounts of the subsidiary companies and the related detailed information, upon receipt of request from any Member of the Company interested in obtaining the same. However, as directed by the Central Government, the financial data of the subsidiaries have been separately furnished, forming part of the Annual Report. Further, the Annual Accounts of the subsidiaries would also be available for inspection at the Head Office of the Company and at the Office of the respective subsidiary companies, during working hours up to the date of the Annual General Meeting. The Company shall also put the details of accounts of individual subsidiary companies on its website www.mahindrafinance.com.

JOINT VENTURE

Mahindra Finance USA LLC.

Mahindra Finance USA LLC is a joint venture company incorporated in Delaware, U.S.A, for the purpose of providing wholesale inventory financing to US based dealers, financing dealer purchases of Mahindra products and providing retail financing to end- user customers to finance their lease or purchase of Mahindra products or used products from dealers, in U.S.A. The Company has a 49 per cent shareholding along with De Lage Landen Financial Services Inc., a wholly-owned subsidiary of the Rabobank Group, which holds the balance 51 per cent shareholding in the joint venture company.

The joint venture company''s disbursement registered a growth of 67.63 per cent as compared to the previous year. Income grew by 144.66 per cent to USD 104.42 Lacs for the year ended 31st March, 2013 as compared to USD 42.68 Lacs for the previous year. Profit Before Tax was 205.99 per cent higher at USD 26.04 Lacs as compared to USD 8.51 Lacs for the previous year. Profit After Tax grew at a healthy rate of 212.69 per cent to USD 16.26 Lacs as compared to USD 5.20 Lacs in the previous year.

CONSOLIDATED FINANCIAL STATEMENTS

The Consolidated Financial Statements of the Company and its three subsidiaries viz. MIBL, MRHFL and MBCSPL, prepared in accordance with Accounting Standard AS21 prescribed by The Institute of Chartered Accountants of India, form part of this Annual Report. The Consolidated Financial Statements presented by the Company include the financial results of its subsidiary companies and its joint venture viz. Mahindra Finance USA LLC.

AUDITORS

Messrs. B. K. Khare & Co., Chartered Accountants, retire as Auditors of the Company at the forthcoming Annual General Meeting and have given their consent for re-appointment. The shareholders would be required to elect Auditors for the current year and fix their remuneration.

As required under the provisions of section 224(1B) of the Companies Act, 1956, the Company has obtained a written certificate from Messrs. B. K. Khare & Co., Chartered Accountants, to the effect that their re- appointment, if made, would be in conformity with the limits specified in the said section.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars relating to the energy conservation, technology absorption and foreign exchange earnings and outgo, as required under section 217(1)(e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 are given in Annexure II to this Report.

PARTICULARS OF EMPLOYEES AS REQUIRED UNDER SECTION 217(2A) OF THE COMPANIES ACT, 1956 AND THE RULES MADE THEREUNDER

The Company had eight employees who were in receipt of remuneration of not less than Rs. 60,00,000 during the year ended 31st March, 2013 or not less than Rs. 5,00,000 per month during any part of the said year. However, as per the provisions of section 219(1)(b)(iv) of the Companies Act, 1956, the Directors'' Report and Accounts are being sent to all the Shareholders of the Company excluding the Statement of particulars of employees. Any Shareholder interested in obtaining a copy of the Statement may write to the Company Secretary of the Company.

For and on behalf of the Board

Bharat Doshi

Chairman

Mumbai, 23rd April, 2013


Mar 31, 2012

To The members of Mahindra & Mahindra Financial Services Limited

The Directors are pleased to present their Twenty-second Report together with the audited accounts of your Company for the Financial Year ended 31st March, 2012. The summarised financial results of the Company are given below:

(Rs. in Crores)

March 2012 March 2011

Total Income 2,794.6 1,977.5

Less : Finance Costs 1,120.3 660.2

Expenditure 729.5 599.1

Depreciation/Amortisation 19.6 15.8

Total Expenses 1,869.4 1,275.1

Profit Before Tax 925.2 702.4 Less : Provision For Tax

Current Tax 289.6 249.1

Deferred Tax 15.5 (9.8)

Profit After Tax for the Year 620.1 463.1

Add : Amount brought forward from Previous Years 713.6 510.7

Amount available for Appropriation 1,333.7 973.8 Appropriations :

General Reserve 62.0 46.3

Statutory Reserve 124.0 92.6

Proposed dividend on Equity Shares 145.6 104.0

Income-tax on proposed dividend 22.6 17.3

Excess provision for Corporate Dividend Tax on Equity Shares (0.4) - of earlier year

Surplus carried to Balance Sheet 979.9 713.6

1,333.7 973.8

DIVIDEND

Your Directors are pleased to recommend a dividend of Rs.14 per Equity Share of the face value of Rs. 10 each, payable to those Members whose names appear in the Register of Members as on the Book Closure date. The dividend including dividend tax will absorb a sum of Rs. 168.2 Crores (as against Rs. 121.3 Crores on account of dividend of Rs. 10 per Equity Share, paid for the previous year).

OPERATIONS

The overall disbursement registered a growth of 35.3 per cent at Rs. 19,504.3 Crores as compared to Rs. 14,419.9 Crores in the previous year. Your Company during the year under review, continued to provide a wide range of financial products and services to its customers through diversification of its product portfolio within its vehicle financing business as well as through the introduction and growth of other financial

products and maintained its market leadership position in rural and semi-urban markets. Your Company has increased its presence in financing of commercial vehicle, construction equipment, as well as, pre-owned vehicle while maintaining aggressive growth in car financing, retaining its leadership position in financing Mahindra range of vehicles and tractors in addition to extending its lending to vehicles of other Original Equipment Manufacturers (OEMs).

Your Company has one of the largest network of branches amongst Non-Banking Financial Companies operating in rural and semi-urban areas. Your Company's nationwide network of branches and locally recruited employees have facilitated in developing and strengthening relationship with its customers.

During the year under review, your Company continued to explore the opportunities in the Micro Small and Medium Enterprises (MSME) segment as well as in the emerging Gold Loan industry in India.

Income grew by 41.3 per cent to Rs. 2,794.6 Crores for the year ended 31st March, 2012 as compared to Rs. 1,977.5 Crores for the previous year. Profit Before Tax was 31.7 per cent higher at Rs. 925.2 Crores as compared to Rs. 702.4 Crores for the previous year. Profit After Tax grew at a healthy rate of 33.9 per cent to Rs. 620.1 Crores as compared to Rs. 463.1 Crores in the previous year.

Your Company has achieved a very important milestone of cumulatively financing over two million customers since its inception. The number of contracts entered into by the Company during the year was 4,66,416 as against 3,67,774 in the previous year.

During the year under review, the Assets Under Management have crossed Rs. 20,000 Crores and stood at Rs. 20,643.0 Crores as at 31st March, 2012.

DISTRIBUTION OF MUTUAL FUND PRODUCTS

During the year under review, the activity of distribution of Mutual Fund Products (MFP) was carried out across 31 branches covering 14 States.

The amount of MFP outstanding through the Company's Advisory Services, aggregate of institutional and retail segment crossed an amount of Rs.875 Crores and the number of clients stood at 41,074.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

A detailed discussion on the Company's operations is presented in the chapter on Management Discussion and Analysis, which forms part of this Annual Report.

ECONOMY

The global economy witnessed significant volatility during the year. While growth and employment in the US economy appeared to be improving, the crisis in the Euro Zone threatened to plunge the entire financial world into turmoil. European Central Bank's intervention has seemingly defused the situation but it is expected that other steps need to be taken for the threat of a crisis to recede. The deleveraging of the European Banks is expected to affect capital flows to emerging markets and the resultant liquidity crunch might drive up the interest rates.

Faced with global uncertainty, cyclical and structural factors, India's growth slowed down to less than 7 per cent for the Financial Year 2011-12. While the services continued to grow at a rapid pace (8.7 per cent growth), there was a sharp slowdown in industrial growth to 2.8 per cent. During the year, inflation continued to be a key concern for the Reserve Bank of India (RBI) and the various steps taken by it in the first half helped in reducing the inflation rate to 6.9 per cent by March 2012. However, this led to a steep rise in the interest costs and the weighted average lending rates of the five major public sector banks increased from 11 per cent in March 2011 to 12.8 per cent by March 2012. The slowdown in growth coupled with high interest rates has led to a decline in investment rates.

Liquidity conditions were tight throughout the year and the situation aggravated post November 2011 when the liquidity deficit exceeded 1 per cent of net demand and time liabilities (NDTL) of banks. To ease the situation, RBI conducted significant Open Market Operations (OMOs) and cut the Cash Reserve Ratio (CRR) by 125 basis points leading to an improvement in the liquidity situation. It is expected that the scenario of tight liquidity and high interest rates will continue in the Financial Year 2012-13.

Amidst the overall slowdown in the economy, the semi-urban and rural markets, the focus areas of the Company, continued to witness rapid growth. The combination of increased disposable incomes along with favourable demographics led to a robust demand for various products and services in these markets. Consequently, vehicle demand in rural areas grew at a faster pace, an area which is core to the Company's operations. With broad-basing of economic activities in the rural areas and the governmental thrust on rural infrastructure, it is expected that rural India will continue to grow rapidly in the next year.

FINANCE

During the year under review, RBI continued its stance against inflation and adopted a calibrated approach by hiking the Repo Rate five times totalling to 175 basis points to contain the inflationary pressure, which resulted in medium/long term interest rates moving up approximately by 150 basis points. Liquidity conditions remained in a deficit mode throughout the year resulting in the increase of short term money market rate by 200 basis points. In order to mitigate the liquidity tightness, RBI conducted OMOs and reduced CRR by 125 basis points during the last quarter of the year. However, your Company was able to reduce the impact of increase in the interest rates by ensuring that prudent Asset Liability Management Guidelines are adhered to.

In its Monetary Policy for the Financial Year 2011-12, RBI discontinued the priority sector status for bank loans to Non-Banking Financial Companies (NBFCs), thereby placing additional pressure on NBFCs in raising funds.

During the year under review, your Company continued with its diverse methods of sourcing funds in addition to regular borrowings like Secured and Unsecured Debentures, Term Loans, Commercial Paper, etc., and maintained prudential Asset/Liability match through out the year. Your Company sourced long term loans from banks at attractive rates. Your Company also issued Subordinated Debt amounting to Rs. 100.5 Crores and successfully assigned receivables to the tune of Rs. 1,487.4 Crores.

During the year, your Company actively participated in a number of investor meets both in India and abroad organised by reputed Global and Domestic Broking Houses. Your Company also periodically conducted analysts' meets and conference calls to communicate details of performance, important developments and exchange of information.

SHARE CAPITAL

The shareholders have by a Special Resolution passed by means of a Postal Ballot Voting process on 1st March, 2012, approved the issue of Redeemable Non- Convertible Preference Shares of an aggregate nominal amount not exceeding Rs. 50 Crores, in the course of domestic offering.

CAPITAL ADEQUACY

As on 31st March, 2012, the Capital to Risk Assets Ratio (CRAR) of your Company was 18.0 per cent as against the minimum requirement of 15.0 per cent prescribed by RBI.

STOCK OPTIONS

During the year under review, on the recommendation of the Remuneration/Compensation Committee of your Company, the Trustees of the Mahindra & Mahindra Financial Services Limited Employees' Stock Option Trust have granted 42,426 Stock Options to Eligible Employees under the 'Mahindra & Mahindra Financial Services Limited Employees' Stock Option Scheme-2010' No new Options have been granted under the 'Mahindra & Mahindra Financial Services Limited Employees' Stock Option Scheme-2005'

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

RBI GUIDELINES

The Company has complied with all the applicable regulations of the Reserve Bank of India (RBI). As a prudent practice, your Company makes accelerated provisioning for Non-Performing Assets (NPAs) than that required by RBI for NBFCs.

Standard Assets' Provisioning

Pursuant to the Notification No. DNBS.222/CGM (US)- 2011 dated 17th January, 2011 issued by the RBI for making a general provision at 0.25 per cent on the outstanding standard assets of NBFCs, your Company has made a provision of Rs.43.5 Crores as at 31st March, 2012, towards the same.

CREDIT RATING

During the year under review, CRISIL Limited [CRISIL], has reaffirmed the rating to the Company's Long-term Debt Instruments and Bank Facilities as 'CRISIL AA / Stable' and the Company's Fixed Deposit Programme as 'FAAA/Stable', respectively. The 'AA /Stable' rating indicates a high degree of safety with regard to timely payment of financial obligations. The rating on the Company's Short-term Debt and Bank Loans has been re-affirmed at 'CRISIL A1 ' (earlier P1 ) which is the highest level of rating. CRISIL has, pursuant to Circular No. CIR/MIRSD/4/2011 dated 15th June, 2011 issued by the Securities and Exchange Board of India (SEBI) on 'Standardisation of Rating Symbols and Definitions' revised its rating symbols and definitions with effect from 11th July, 2011.

During the year under review, Fitch Ratings India Private Limited has, after due consideration, upgraded the Company's National Long-term Rating instrument and Lower Tier II Subordinated Debt programme to 'Fitch AA (ind)'/Stable from 'Fitch AA(ind)'/Positive. The 'AA(ind)' national ratings denote a very strong credit risk relative to other issuers or issues in the country. The credit risk inherent in these financial commitments differs only slightly from the country's highest rated issuers or issues. Within a band of rating symbols from 'AA(ind)' to 'B(ind)', the signs " " or "-" may be appended to a rating to denote relative status within the rating category.

Brickworks Ratings India Private Limited has, during the year, re-affirmed the "BWR AA " rating with Positive outlook to the Company's Long-term Subordinated Debt Issue. 'BWR AA ' stands for an instrument that is considered to offer high credit quality/safety in terms of timely servicing of principal and interest obligations.

FIXED DEPOSITS AND LOANS/ADVANCES

As on 31st March, 2012, your Company has mobilised funds from Fixed Deposits to the tune of Rs.1,670 Crores, with an investor base of over 85,000 investors.

Your Company has initiated various measures towards improvement of service levels to the Fixed Deposit holders. As a customer-centric process, the Company has initiated the process of online repayment directly to the customer's account on maturity of the Fixed Deposit. In cases where electronic transfer facility is not available, the repayment is made through a post-dated cheque before the maturity date to the depositors.

As at 31st March, 2012, 708 deposits amounting to Rs.3.3 Crores had matured for payment and remained unclaimed. The unclaimed deposits have since reduced to 351 deposits amounting to Rs. 1.7 Crores.

The particulars of loans/advances and investment in its own shares by listed companies, their subsidiaries, associates, etc., required to be disclosed in the Annual Accounts of the Company pursuant to Clause 32 of the Listing Agreement are furnished separately.

SUSTABILITY INITIATIVES

Your Company has taken a lead role in Financial Services Sector in India to protect and sustain the rural livelihoods through a sustainable business model. The model aims at transforming rural lives and driving positive change in the community. From the Financial Year 2008-09 onwards, your Company has taken steady but impactful steps towards sustainability by charting out a roadmap of five years on Triple bottom line for balanced approach towards economic activity, environmental responses and social progress. In the Financial Year 2009-10, your Company released the Finance Sector supplement stipulated by Global Reporting Initiative (GRI) giving an overview of Product Portfolio and initiatives of Financial Literacy for customers. Your Company's Sustainability Report continues to attain A rating from GRI.

During the year, your Company enhanced the scope of Sustainability Reporting to its two subsidiaries, viz. Mahindra Insurance Brokers Limited and Mahindra Rural Housing Finance Limited. The Company has started with initiatives like Online Drona (Induction) Program as well as Online Appraisal aimed at reducing the consumption of paper. Your Company is glad to inform that it was able to reduce 95 per cent of paper consumed in these two processes. Your Company also gave an option to the shareholders to avail of a copy of the Annual Report in electronic form instead of a physical copy. Your Company continued installation of Solar Hybrid Photovoltaic Power System at various branches, which operates on Solar Power during day time. Around twenty-five branches have been installed with Solar panels. Enquiry Management and Loan Application Process (EMLAP) and Handheld Devices have led to complete automation of the field related activities, which not only helped to achieve reduction in the Green House Gas emissions but also resulted into reduced paper consumption and improved the quality of service. Around 700 desktops have been replaced with Thin Client for power efficiency in branches resulting in saving of around 125 watts of electricity per hour.

Your Company continued with its focus on enhancing the concept of sustainability in the minds of its employees, vendors, suppliers and customers and has taken various initiatives for conservation of water and energy as well as reduction of noise pollution.

CORPORATESOCIAL RESPONSIBILITY INTIATIVES

As a socially responsible citizen, the Mahindra Group continues to contribute to the economic well being of the communities it interacts with and enhance their social well being. The Mahindra Group has incessantly been engaged in activities, which add value to the community around it.

Your Company has always been committed to the fact that, since corporations are vital organs of the society, corporate interests must address societal concerns for the sustainable development of the society and towards this end your Company has played an active role in discharging its social responsibilities. During the year under review, your Company continued to involve itself in social welfare activities by contributing to recognised Charitable Institutions, which specifically benefit the economically weaker and socially disadvantaged sections of the society. Your Company has sponsored 376 Nanhi Kalis, the flagship programme of the K.C. Mahindra Education Trust, which supports the education of the disadvantaged girl child.

Your Company organised a nationwide Blood Donation Drive to re-affirm its pledge to the society and collected 1,000 bottles of blood. During the year under review, your Company also donated funds for purchase of ambulance to numerous Charitable Institutions.

During the year under review, your Company contributed Rs.460.73 Lacs towards CSR to various Non- Governmental Organisations for charitable purposes.

ACHIEVEMENTS

During the year under review, your Company was awarded the NASSCOM IT User Awards 2012, the National Awards for IT Excellence, the Edge VD (Virtual Desktop) Award 2011, the Edge BI (Business Intelligence) Award 2011, SKOCH Digital Inclusion Award 2011, InfoSecurity Top 100 CISO Award 2011 and IT Next 100 (Future CIO) Award.

Your Company has won the Asia's Best Employer Brand Awards 2011 as well as the Award for Best Corporate Social Responsibility (CSR) Practices. The Company was also bestowed with the Indian Development Foundation CSR Award for its excellent contribution and support towards blanket mobilisation drive for leprosy patients in October, 2011. Your Company was ranked 4th in the Financial Services Sector by the Great Places to Work Institute.

DIRECTORS

Mr. Uday Y. Phadke resigned as the Vice-Chairman of the Company with effect from 24th October, 2011. Mr. Phadke continues to be a Non-Executive Director of the Company.

Mr. Uday Y. Phadke, Non-Executive Director and Mr. M. G. Bhide, Independent Director, retire by rotation at the forthcoming Annual General Meeting and, being eligible, offer themselves for re-appointment.

CORPORATE GOVERNANCE

A report on Corporate Governance along with a certificate from the Auditors of the Company regarding the compliance with conditions of Corporate Governance as also the Management Discussion and Analysis Report as stipulated under Clause 49 of the Listing Agreement are annexed to this Report.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to section 217(2AA) of the Companies Act, 1956, your Directors, based on the representation received from the Operating Management, and after due enquiry, confirm that:

i) in the preparation of the annual accounts, the applicable accounting standards have been followed;

ii) they have, in the selection of the accounting policies, consulted the Statutory Auditors and these have been applied consistently and reasonable and prudent judgments and estimates have been made so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2012 and of the profit of the Company for the year ended on that date;

iii) proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

iv) the annual accounts have been prepared on a going concern basis.

SUBSIDIARY COMPANIES

Mahindra Insurance Brokers Limited

The year under review represents the eighth year of insurance broking operations of your Company's

wholly-owned subsidiary Mahindra Insurance Brokers Ltd. (MIBL). During the year under review MIBL's Direct Broking license was renewed by the Insurance Regulatory and Development Authority (IRDA) with effect from 18th May, 2010 for a period of three years. The category of broker licence was subsequently upgraded from Direct to a Composite Broking licence, enabling MIBL to undertake Reinsurance broking business in addition to its existing Direct insurance broking for Life and Non-Life products.

During the year, MIBL crossed the 7,00,000 mark in terms of policies serviced, with a total of 7,03,730 policies for both Life and Non-Life Retail business lines. The customised Life Insurance covers "Mahindra Loan Suraksha" and "Sampoorna Suraksha" continued to receive an encouraging response and grew by 33 per cent from 2,73,138 lives covered with a Sum Assured of Rs.6,193.7 Crores in the Financial Year 2010-11 to 3,63,691 lives covered with a Sum Assured of Rs. 8,255.0 Crores in the Financial Year 2011-12, with a substantial portion being covered in the rural markets.

During the year, MIBL achieved a growth of 43.1 per cent in Net Premium generated for the Corporate and Retail business lines increasing from Rs.289.2 Crores (Gross Premium Rs. 318.6 Crores) in the Financial Year 2010-11 to Rs. 413.8 Crores (Gross Premium Rs.456.2 Crores) in the Financial Year 2011-12, crossing a milestone of Rs.400 Crores Gross Premium.

The Income decreased by 10.0 per cent from Rs.51.8 Crores in the Financial Year 2010-11 to Rs.46.6 Crores in the Financial Year 2011-12. The Profit Before Tax decreased by 38.9 per cent from Rs.32.9 Crores to Rs.20.1 Crores, and the Profit After Tax decreased by 38.0 per cent from Rs.21.8 Crores to Rs.13.5 Crores during the same period.

The decrease in Income and consequent decline in profits was due to the impact of the clarificatory Circular issued by the IRDA on Group Insurance Guidelines. The Guidelines became effective from 1st April 2011. MIBL has re-engineered its processes in line with the clarified Guidelines and has recommenced business income on the affected Group Insurance business, in December 2011.

Mahindra Rural Housing Finance Limited

Mahindra Rural Housing Finance Limited (MRHFL) has during the year ended 31st March, 2012, disbursed loans aggregating Rs. 266.75 Crores (previous year Rs. 203.63 Crores). The Profit After Tax for the year ended 31st March, 2012 was Rs. 11.91 Crores (previous year Rs. 8.86 Crores). The outstanding loan portfolio as on 31st March, 2012 stood at Rs. 535.23 Crores.

MRHFL continued its focus on serving customers in rural India. More than 90 percent of the loans disbursed were to customers in villages having an average annual household income of less than Rupees Two Lacs. During the year under review, over 32,000 households were given home loans. As against this, since inception, MRHFL had given loans to approximately 30,000 households till 31st March, 2011.

The housing loans sanctioned during the year ended 31st March, 2012 were Rs. 292.16 Crores as against Rs. 263.05 Crores sanctioned during the previous year. The cumulative loans sanctioned by MRHFL as at the end of the Financial Year 2011-12 was Rs. 718.44 Crores as compared to Rs. 426.28 Crores in the previous year. The cumulative loan disbursement at the end of the year stood at Rs. 607.36 Crores as compared to Rs. 340.61 Crores in the previous year.

MRHFL has been expanding its geographical presence, by leveraging the infrastructure of your Company, and currently operates in the states of Maharashtra, Gujarat, Rajasthan, Tamilnadu, Andhra Pradesh, Kerala, Karnataka and Madhya Pradesh.

Mahindra Business & Consulting Services Private Limited

Mahindra Business & Consulting Services Private Limited (MBCSPL) provides staffing services mainly for your Company and its subsidiaries viz. MIBL and MRHFL and the ultimate parent company, viz. Mahindra & Mahindra Limited. As at 31st March, 2012 MBCSPL had on its rolls 6,096 employees who were deputed to these companies to provide services under ongoing contracts.

MBCSPL earns its income in the form of fees towards staffing services. MBCSPL registered a Profit After Tax of Rs. 7.06 Lacs for the year ended 31st March, 2012 as compared to Rs. 54.43 Lacs in the previous year.

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

In accordance with the General Circular No. 2/2011 dated 8th February, 2011 issued by the Ministry of Corporate Affairs, Government of India, the Balance Sheet, Statement of Profit and Loss and other documents of the subsidiary companies are not being attached to the Balance Sheet of the Company.

The Company Secretary will make available the Annual Accounts of the subsidiary companies and the related detailed information, upon receipt of request from any Member of the Company interested in obtaining the same. However, as directed by the Central Government, the financial data of the subsidiaries have been separately furnished forming part of the Annual Report. These documents will also be available for inspection at the Head Office of the Company and at the Office of the respective subsidiary companies, during working hours up to the date of the Annual General Meeting. The Company shall also put the details of accounts of individual subsidiary companies on its website www.mahindrafinance.com.

CONSOLIDATED FINANCIAL STATEMENTS

The Consolidated Financial Statements of the Company and its three subsidiaries viz. MIBL, MRHFL and MBCSPL, prepared in accordance with Accounting Standard 21 prescribed by The Institute of Chartered Accountants of India, form part of this Annual Report. The Consolidated Financial Statements presented by the Company include the financial results of its subsidiary companies and its joint venture viz. Mahindra Finance USA LLC.

AUDITORS

Messrs. B. K. Khare & Co., Chartered Accountants, retire as Auditors of the Company at the forthcoming Annual General Meeting and have given their consent for re-appointment. The shareholders would be required to elect Auditors for the current year and fix their remuneration.

As required under the provisions of section 224(1B) of the Companies Act, 1956, the Company has obtained a written certificate from Messrs. B. K. Khare & Co., Chartered Accountants, to the effect that their re- appointment, if made, would be in conformity with the limits specified in the said section.

CONSERVATION OF ENERGY,TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The particulars relating to the energy conservation, technology absorption and foreign exchange earnings and outgo, as required under section 217(1 )(e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 are given in Annexure II to this Report.

PARTICULARS OF EMPLOYEES AS REQUIRED UNDER SECTION 217(2A) OF THE COMPANIES ACT,1956 AND THE RULES MADE THEREUNDER

The Company had three employees who were in receipt of remuneration of not less than Rs. 60,00,000 during the year ended 31st March, 2012 or not less than Rs. 5,00,000 per month during any part of the said year. However, as per the provisions of section 219(1)(b)(iv) of the Companies Act, 1956, the Directors' Report and Accounts are being sent to all the Shareholders of the Company excluding the Statement of particulars of employees. Any Shareholder interested in obtaining a copy of the Statement may write to the Company Secretary of the Company.

For and on behalf of the Board

Bharat Doshi Chairman

Mumbai, 23rd April, 2012


Mar 31, 2011

Dear Members,

The directors are pleased to present their twenty-first report together with the audited accounts of your company for the financial year ended 31st march, 2011. the summarised financial results of the company are given below:

financial results

(rs. in crores)

march 2011 march 2010

total income 2012.5 1568.8

less : finance costs 660.2 501.7

expenditure 634.1 536.6

depreciation/amortisation 15.8 9.9

total expenses 1310.1 1048.2

profit before tax 702.4 520.6

less : provision for tax

current tax 249.1 204.4

deferred tax (9.8) (28.2)

profit after tax for the year 463.1 344.4

add/less : (excess)/short provision for income-tax - – 1.7 earlier years (net)

balance profit after tax 463.1 342.7

add : amount brought forward from previous years 510.7 355.8

amount available for appropriation 973.8 698.5

appropriations :

general reserve 46.3 34.3

statutory reserve 92.6 68.5

proposed dividend on equity shares 104.0 72.7 income-tax on proposed dividend 17.3 12.3

surplus carried to balance sheet 713.6 510.7

973.8 698.5

Dividend

Your directors are pleased to recommend a dividend of rs. 10 per equity share, payable to those members whose names appear in the register of members as on the book closure date. the dividend including dividend tax will absorb a sum of rs. 121.3 crores (as against rs. 85.0 crores on account of dividend of rs. 7.50 per equity share, paid for the previous year).

operations

The overall disbursement registered a growth of 61.7 per cent at rs. 14,419.9 crores as compared to rs. 8,915.4 crores in the previous year. your company during the year under review, continued to diversify its product portfolio within its vehicle financing business as well as through the introduction and growth of other financial products and maintained its market leadership position in rural and semi-urban market. your company has increased its presence in financing of commercial vehicle, construction equipment, as well as, pre-owned vehicle while maintaining aggressive growth in car financing, retaining its leadership position in financing mahindra range of vehicles and tractors.

Income grew by 28.3 per cent to rs. 2,012.5 crores for the year ended 31st march, 2011 as compared to rs. 1,568.8 crores for the previous year. profit before tax was 34.9 per cent higher at rs. 702.4 crores as compared to rs. 520.6 crores for the previous year. profit after ta x grew at a healthy rate of 35.1 per cent to rs. 463.1 crores as compared to rs. 342.7 crores in the previous year.

your company has achieved a very important milestone of cumulatively financing over one and a half million customers since its inception. The number of contracts entered into by the company during the year was 3,67,774 as against 2,16,355 in the previous year.

During the year under review, the assets under management have crossed rs. 15,000 crores and stood at rs. 15,161.0 crores as at 31st march, 2011.

Distribution of mutual fund products

During the year under review, the activity of distribution of mutual fund products (mfp) was carried out across 17 branches covering 10 states.

The amount of mutual fund products outstanding through the company's advisory services, aggregate of institutional and retail segment crossed an amount of rs. 700 crores and the number of clients crossed 40,000.

management discussion and analysis report

a detailed discussion on the company's operations is presented in the chapter on management discussion and analysis, which forms part of this annual report.

Economy

The global economy continued to recover from the meltdown of 2008. the excess liquidity that arose due to programs such as quantitative easing ii of us and similar programs followed by most other central banks was the primary contributor to this recovery. however, towards the end of the year most central banks initiated steps to remove the excess liquidity and this is expected to drive up interest rates and might also affect capital flows to emerging markets.

The indian economy continued to maintain its high level of growth and in the financial year 2010-11 the gross domestic product grew by 8.5 per cent. the growth was broad-based across the various sectors of the economy and was driven by both domestic investment and consumption. the high growth of the auto sector (29 per cent) and increasing agricultural incomes were of importance to the company. liquidity became tight from june 2010 as a huge amount of over rs. 1,00,000 crores was removed on account of auction of 3g and wimax licenses. during the year, the inflation continued to be a big area of concern and was close to 10 per cent for the majority of the year, substantially above the reserve bank of india's (rbi) initial inflation target rate of 5.5 per cent. this led the rbi to increase the interest rate in a bid to tame inflation. the high interest rate scenario is expected to continue in the financial year 2011-12.

The semi-urban and rural markets, the focus areas of the company, continued to witness rapid growth. the various infrastructure projects executed across the country along with job guarantee schemes (such as mgnrega) led to increased job creation and enhanced demand for equipment and vehicles. while the high food prices were a concern in the urban areas, they led to a significant increase in farmer earnings. the combination of increased disposable incomes along with favourable demographics led to a robust demand for various products and services in these markets.

During the year under review, rbi followed a policy of calibrated tightening. this was justified by the trend of moderating inflation and consolidating growth in the second and third quarters of the financial year 2010-11. liquidity conditions remained abnormally tight for much of the year owing to a combination of structural and frictional factors. the liquidity adjustment facility (laf) corridor stayed almost entirely in the injection mode during the year under review. the rbi instituted a number of measures to ease the excessive tightness in the system.

There are signs that in recent months economic growth in india has become more broad-based with industrial growth displaying less volatility across sectors;agriculture has picked up due to good rabi season and service sector growth remained robust.

Finance

During the year under review, the reserve bank of india adopted a calibrated approach by hiking the repo rate seven times by 25 basis points each to contain the inflationary pressure and also introduced the base rate system from july 2010 which resulted in medium/long term interest rate moving up by approximately 175 basis points. tight liquidity conditions persisted throughout the year resulting in the short term money market rate increasing upward of 200 basis points. however, your company was able to reduce the impact of increase in interest rate by continuously monitoring asset liability management and following prudent asset liability management guidelines.

During the year under review, your company continued its innovative methods of sourcing funds in addition to regular borrowings like secured and unsecured debentures, term loans, commercial paper, etc., and maintained prudential asset/liability match through out the year. your company sourced long term loans from consortium banks at attractive rates and a proportion of the same was eligible for priority sector lending for banks. your company also issued subordinated debt amounting to rs. 200 crores and successfully assigned receivables to the tune of rs. 1,228 crores.

During the year, your company has actively participated in a number of international and domestic investor meets organised by reputed international banks and financial services companies.

your company also periodically conducted analysts' meets to communicate details of performance, important developments and exchange information.

Share capital

The members have by means of a postal ballot on 3rd january, 2011, approved the increase in the authorised share capital of the company from rs. 1,60,00,00,000 (rupees one hundred sixty crores) divided into 11,00,00,000 (eleven crores) equity shares of rs. 10 (rupees ten) each and 50,00,000 (fifty lacs) redeemable preference shares of rs. 100 (rupees hundred) each to rs.1,90,00,00,000 (rupees one hundred ninety crores) divided into 14,00,00,000 (fourteen crores) equity shares of rs. 10 (rupees ten) each and 50,00,000 (fifty lacs) redeemable preference shares of rs. 100 (rupees hundred) each, by the creation of additional 3,00,00,000 (three crores) equity shares of rs. 10 (rupees ten) each.

your company has allotted 9,69,005 equity shares of rs. 10 each to the trustees of the mahindra & mahindra financial services limited employees' stock option trust.

On 22nd february, 2011, your company successfully concluded the qualified institutions placement (qip) issue to qualified institutional buyers aggregating rs. 426.3 crores through the issue of 61,33,205 equity shares of the face value of rs. 10 each at a price of rs. 695 per equity share including a premium of rs. 685 per equity share, which is a 3.4 per cent premium to the price of rs. 672.75 per share, arrived at as per regulation 85 of securities and exchange board of india (issue of capital and disclosure requirements) regulations, 2009. the company received bids of approximately rs. 1,579.45 crores. despite it being launched in markets clouded by bearish sentiments, the first qip offering by your company received an overwhelming response, as seen by the high- levels of subscription and strong participation from international institutional investors.

your company has duly utilised the issue proceeds to augment its capital base, meet its capital requirements, for other general corporate purposes and for payment of issue expenses.

This is in line with the issue purpose mentioned in the placement document filed with various regulatory authorities.

Post allotment of equity shares as aforesaid, the issued, subscribed and paid-up share capital of the company stands at rs. 104 crores comprising of 10,40,02,735 equity shares of rs. 10 each fully paid-up.

capital adequacy

consequent upon the allotment of equity shares to the mahindra & mahindra financial services limited employees' stock option trust under the mahindra & mahindra financial services limited employees' stock option scheme 2010 and allotment of shares to qualified institutional buyers under the qualified institutions placement, the paid-up share capital of the company has increased to rs. 104.0 crores as on 31st march, 2011 from rs. 96.9 crores as on 31st march, 2010. the securities premium account has also increased to rs. 1,162.0 crores from rs. 749.6 crores.

As a result of the increased net worth, your company was able to enhance the capital to risk assets ratio (crar) to 20.3 per cent as on 31st march, 2011, which is well above 12.0 per cent crar prescribed by the reserve bank of india (rbi). pursuant to the recent notification no. dnbs.224/cgm (us) - 2011 dated 17th february, 2011 issued by the rbi all deposit taking nbfcs are required to maintain a minimum capital ratio consisting of tier i and tier ii capital, which shall not be less than 15 per cent of its aggregate risk weighted assets on balance sheet and risk adjusted value of off-balance sheet items, with effect from 31st march,2012.

Holding company

pursuant to the allotment of equity shares to the mahindra & mahindra financial services limited employees' stock option trust and the qualified institutional buyers under the qualified institutions placement, the shareholding of mahindra & mahindra limited, the holding company, stands reduced to 56.0 per cent from 60.1 per cent.

stock options

pursuant to the approval of the members by means of a postal ballot voting process on 18th september, 2010, your company has adopted and introduced the ‘mahindra & mahindra financial services limited employees' stock option scheme–2010' (esos-2010). on the recommendation of the remuneration/ compensation committee of your company, the trustees of the mahindra & mahindra financial services limited employees' stock option trust have granted 2,51,565 stock options to eligible employees under the esos -2010.

During the year under review, no new options have been granted under the ‘mahindra & mahindra financial services limited employees' stock option scheme–2005'.

Details required to be provided under the securities and exchange board of india (employee stock option scheme and employee stock purchase scheme) guidelines, 1999 are set out in annexure i to this report.

Rbi guidelines

The company has complied with all the applicable regulations of the reserve bank of india (rbi). as a prudent practice, your company makes accelerated provisioning for non performing assets (npas) than that required by rbi for nbfcs.

standard assets' provisioning

pursuant to the notification no. dnbs.222/cgm (us)-2011 dated 17th january, 2011 issued by

The rbi for making a general provision at 0.25 per cent on the outstanding standard assets of nbfcs, your company has made a provision of rs. 31.4 crores for the year ended 31st march, 2011, towards the same.

credit rating

During the year under review, crisil limited, has after due consideration, upgraded the rating to your company's long-term debt instruments and bank facilities from ‘aa-/sTable' to ‘aa / sTable' and your company's fixed deposit programme from ‘faa/sTable' to ‘faaa/sTable', respectively. the ‘aa /sTable' rating indicates a high degree of safety with regard to timely payment of financial obligations. the rating on the company's short-term debt and bank loans has been re-affirmed at ‘p1 ' - which is the highest level of rating.

Fitch ratings india private limited, has during the year under review, re-affirmed the ‘aa(ind)' ratings with the outlook as positive assigned to the company's national long-term rating instrument and lower tier ii subordinated debt programme. the ‘aa (ind)' national ratings denote a very strong credit risk relative to other issuers or issues in the country. the credit risk inherent in these financial commitments differs only slightly from the country's highest rated issuers or issues.

Brickworks ratings india private limited, has during the year, re-affirmed the "bwr aa " rating with positive outlook to the company's long-term subordinated debt issue. instruments with this rating are considered to offer high credit quality in terms of timely servicing of debt obligation.

fixed deposits and loans/ advances

your company has started accepting fixed deposits from the public with effect from 1st january, 2009 and has mobilised funds to the tune of rs. 943 crores, with an investor base of over 80,000 investors.

your company has initiated various measures towards improvement of service levels to the fixed deposit holders. as a customer centric process, the company normally despatches the post-dated repayment cheques in respect of all the deposits, well in advance, before the maturity date to the depositors.

As at 31st march, 2011, 436 deposits amounting to rs. 2.1 crores had matured for payment and were due to be claimed or renewed. subsequent to the year end, as on 25th april, 2011, 293 deposits amounting to rs. 1.2 crores had matured for payment and were due to be claimed or renewed.

The particulars of loans/advances and investment in its own shares by listed companies, their subsidiaries, associates, etc., required to be disclosed in the annual accounts of the company pursuant to clause 32 of the listing agreement with the company are furnished separately.

sustainability initiatives

In 2007-08, your company had participated in the mahindra group's ‘sustainability' initiatives and was part of the group's first sustainability review, which is a voluntary report setting out the company's commitment to the environment and society, while generating profits. this report was released by mahindra & mahindra limited (m&m) in october 2008 and the shareholders were informed of this initiative in the previous year's directors' report.

In october 2009, the second mahindra sustainability review for the year 2008-09 was published by m&m, wherein information about your company's performance on the three bottom lines - i.e. people, planet and profit, was also included. this report was externally assured by ernst & young and rated with the highest level of a and gri checked. this second report reflects your company's progression in this journey and its commitment to taking a more responsible and holistic approach to business in general.

During the year, your company has taken certain initiatives in this direction and created awareness through the sustainability mantra. your company as a step towards ‘green initiative' has continued to formulate innovative methods of hybrid power solution through installation of wind and solar based alternative sources of power in some of its branches in rural and semi-urban areas to overcome chronic power shortage. your company made proactive efforts to fight against global warming by conducting a "tree plantation" programme across india and planted close to 55,000 trees across the country.

your company continued with its focus on enhancing the concept of sustainability in the minds of its employees, vendors, suppliers and customers. your company organised ‘sustainability week' in february 2011, which included inter alia, the concept of gifting plants, no print day, air condition bandh day, car pool day, batti bandh day and plastic free day. various initiatives were also taken for conservation of water and energy, reduction of noise pollution and paper consumption. services to various non-governmental organisations were taken up all year round.

corporate social responsibility initiatives

your company has always been sensitive to the fact that, since corporations are fundamental members of the society, corporate interests must address societal concerns and has played an active role in discharging its social responsibilities. during the year under review, your company continued to involve itself in social welfare activities by contributing to recognised chariTable institutions, which specifically benefit the economically weaker and socially disadvantaged sections of the society. your company has sponsored 735 nanhi kalis, the flagship programme of the k.c. mahindra education trust, which supports the education of the disadvantaged girl child.

your company organised a nationwide blood donation drive to re-affirm its pledge to the society and collected 1,408 bottles of blood. during the year under review, your company also donated funds for purchase of ambulance to bharat vikas parishad, liver foundation, jawaharlal nehru cancer hospital & research centre, janakeeya samithi (arogyam), shree aniruddha upasana foundation, aastha old age hospital & hospice, nirmala samaj kendra and manav seva sangh.

During the year under review, your company contributed rs. 3.4 crores towards csr to various institutions for chariTable purposes.

Achievements

your company has won several awards including the idc enterprise innovation awards, 2010, the edge [enterprises driving growth & excellence through it] 2010 award, the skoch financial inclusion award, in addition to winning thirteen awards in various categories of asia's best employer brand awards by the world hrd congress.

your company was also awarded the aima- iocl award for best motivational practice in manufacturing & services 2010 – service industry and csr awards – indy's – star of the industry award for "best practices in corporate social responsibilities".

Directors

Mr. Anjanikumar choudhari and Mr. m.b.n. rao resigned as directors of the company with effect from 22nd april, 2010 and 22nd october, 2010, respectively. the board has placed on record its sincere appreciation for the valuable services rendered and guidance received from Mr. anjanikumar choudhari and Mr. m.b.n. rao as directors of the company.

Mr. Piyush mankad and ms. rama bijapurkar, independent directors, retire by rotation at the forthcoming annual general meeting and, being eligible, offer themselves for re-appointment.

The term of office of Mr. ramesh iyer as the managing director of the company would come to an end on 29th april, 2011. Mr. iyer was re-appointed as the managing director of the company for a further period of five years effective from 30th april, 2011 to 29th april, 2016 at the meeting of the board of directors of the company held on 25th april, 2011.

corporate governance

A report on corporate governance along with a certificate from the auditors of the company regarding the compliance with conditions of

corporate governance as also the management discussion and analysis report as stipulated under clause 49 of the listing agreement is annexed to this report.

Directors' responsibility statement

pursuant to section 217(2aa) of the companies act, 1956, your directors, based on the representation received from the operating management, and after due enquiry, confirm that:

i) In the preparation of the annual accounts, the applicable accounting standards have been followed;

ii) They have, in the selection of the accounting policies, consulted the statutory auditors and these have been applied consistently and reasonable and prudent judgments and estimates have been made so as to give a true and fair view of the state of affairs of the company as at 31st march, 2011 and of the profit of the company for the year ended on that date;

iii) proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the companies act, 1956 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

iv) The annual accounts have been prepared on a going concern basis.

joint venture

During the year under review, your company has entered into a joint venture with de lage landen financial services inc., (dllfs) a wholly- owned subsidiary of the rabobank group, for setting up a joint venture company viz. mahindra finance usa llc., a state of delaware limited liability company, to inter alia, provide wholesale inventory financing to us based dealers, to finance dealer purchases of mahindra products and to provide retail financing to end-user customers to finance their lease or purchase of mahindra products or used products from dealers, in usa. your company holds 49 per cent of the equity capital of mahindra finance usa llc., the balance 51 per cent being held by dllfs.

dllfs is a global provider of high-quality asset- based financing products headquartered in eindhoven, netherlands and is triple-a rated by the major rating agencies moody's and standard & poor's, with offices and joint ventures in more than 35 countries in europe, north america, south america, asia and australia. dllfs offers lease and financial products for businesses and consumers. the global offering also includes an array of commercial financial solutions.

your company has received the ‘no objection certificate' from the reserve bank of india for setting up the said joint venture and has made an initial investment of approximately rs. 22.8 crores (us$ 5.02 million) in mahindra finance usa, llc.

subsidiary companies

mahindra insurance brokers limited

The business of direct insurance broking for life and non-life products is carried out by your company's wholly-owned subsidiary, mahindra insurance brokers limited (mibl). the year under review represents the seventh year of mibl's insurance broking operations. during the year under review mibl has received its insurance broking license duly renewed with effect from 18th may, 2010 for a period of three years, from the insurance regulatory and development authority.

During the year, mibl crossed the 5,00,000 mark in terms of policies serviced, with a total of 5,08,878 polices for both life and non- life retail business lines. the customised life insurance cover "mahindra loan suraksha" (mls) continued to receive an encouraging response and grew by 87.7 per cent from 1,47,154 lives covered with a sum assured of rs. 3,518.4 crores in the financial year 2009-10 to 2,76,198 lives covered with a sum assured of rs. 6,271.8 crores in the financial year 2010-11, with a substantial portion being covered in the rural markets.

mibl achieved a growth of 55.2 per cent in net premium generated for the corporate and retail business lines, increasing from rs. 186.3 crores (gross premium rs. 202.7 crores) in the financial year 2009-10 to rs. 289.2 crores (gross premium rs. 318.6 crores) in the financial year 2010-11,crossing a milestone of rs. 300 crores gross premium.

The income increased by 65.0 per cent from rs. 31.4 crores in the financial year 2009-10 to rs. 51.8 crores in the financial year 2010-11. the profit before tax increased by 95.8 per cent from rs. 16.8 crores to rs. 32.9 crores, and the profit after tax increased by 96.4 per cent from rs. 11.1 crores to rs. 21.8 crores during the same period.

mahindra rural housing finance limited

mahindra rural housing finance limited (Mrhfl) in the fourth year of its operations disbursed loans aggregating rs. 203.6 crores (previous year rs. 90.6 crores), covering over 21,000 families. the profit after tax for the year ended 31st march, 2011 was rs. 8.9 crores (previous year rs. 2.2 crores). the outstanding loan portfolio as at 31st march, 2011 stood at rs. 315.3 crores.

The housing loans sanctioned during the year ended 31st march, 2011 were to the extent of rs. 263.1 crores as against rs. 107.2 crores sanctioned during the previous year. the cumulative loans sanctioned by Mrhfl as at the end of financial year 2010-11 was rs. 426.3 crores as compared to rs. 163.2 crores in the previous year. the cumulative loan disbursement at the end of the year stood at rs. 340.6 crores as compared to rs. 137.0 crores in the previous year.

Mrhfl has been successful in establishing its presence in the rural and semi-urban areas by leveraging the branch network of your company. during the year, operations were strengthened in the states of maharashtra, gujarat, rajasthan, tamil nadu, andhra pradesh, kerala, karnataka and madhya pradesh.

During the year, Mrhfl was able to secure a great deal of support and guidance from national housing bank.

mahindra business & consulting services private limited

mahindra business & consulting services private limited (mbcspl) has mainly sourced 4,739 employees for your company and its subsidiaries viz. mibl and Mrhfl. the company earns its income in the form of fees towards staffing services. mbcspl registered a profit after tax of rs. 0.5 crores for the year ended 31st march, 2011 as compared to rs. 0.1 crore in the previous year.

The statement pursuant to section 212 of the companies act, 1956, containing details of the company's subsidiaries is attached.

The consolidated financial statements of the company, its three subsidiaries viz. mibl, Mrhfl and mbcspl and the joint venture viz. mahindra finance usa llc, prepared in accordance with accounting standard 21 prescribed by the institute of chartered accountants of india, form part of the annual report.

Pursuant to general circular no. 2/2011 dated 8th february, 2011 issued by the ministry of corporate affairs, granting a general permission to the companies from attaching the annual reports of subsidiaries from the current financial year and in terms of the resolution passed by the board of directors of the company at its meeting held on 2nd march, 2011, copy of the balance sheet, profit and loss account, reports of the board of directors and auditors of the subsidiaries have not been attached to the balance sheet of the company.

The company secretary will make these documents available upon receipt of request from any member of the company interested in obtaining the same. however, as directed by the central government, the financial data of the subsidiaries have been separately furnished forming part of the annual report. these documents will also be available for inspection at the head office of the company and at the office of the respective subsidiary companies, during working hours up to the date of the annual general meeting. the company shall also put the details of accounts of individual subsidiary companies on its website www.mahindrafinance.com.

Auditors

messrs. b. k. khare & co., chartered accountants, retire as auditors of the company at the forthcoming annual general meeting and have given their consent for re-appointment. the shareholders will be required to elect auditors for the current year and fix their remuneration.

As required under the provisions of section 224 (1b) of the companies act, 1956, the company has obtained a written certificate from messrs. b. k. khare & co., chartered accountants, to the effect that their re-appointment, if made, would be in conformity with the limits specified in the said section.

conservation of energy, technology absorption and foreign exchange earnings and outgo

the particulars relating to the energy conservation, technology absorption and foreign exchange earnings and outgo, as required under section 217(1)(e) of the companies act, 1956 read with the companies (disclosure of particulars in the report of board of directors) rules, 1988 are given in annexure ii to this report.

particulars of employees as required under section 217(2a) of the companies act, 1956 and the rules made thereunder

the company had two employees who were in receipt of remuneration of not less than rs. 60,00,000 during the year ended 31st march, 2011 or not less than rs. 5,00,000 per month during any part of the said year. however, as per the provisions of section 219(1)(b)(iv) of the companies act, 1956, the directors' report and accounts are being sent to all the shareholders of the company excluding the statement of particulars of employees. any shareholder interested in obtaining a copy of the statement may write to the company secretary of the company.

for and on behalf of the board

Bharat Doshi chairman

Mumbai, 25th april, 2011


Mar 31, 2010

The Directors present their Twenty-third Annual Report together with the audited accounts of your Company for the year ended 31st March 2010.

FINANCIAL RESULTS

Rs. in Million

For the year ended 31st March 2010 2009

Income 45,747 43,153

Profit before interest, depreciation and tax 11,726 12,005

Interest (1,600) (25)

Profit before depreciation and tax 10,126 11,980

Depreciation (1,299) (1,074)

Profit before tax 8,827 10,905

Provision for taxation (1,314) (1,039)

Profit after tax before non-recurring / exceptionalitems 7,513 9,866

Non-recurring / exceptional items (85) --

Profit for the year after tax and non- recurring / exceptional items 7,428 9,866

Balance brought forward from previous year 13,497 5,202

Profit available for appropriation 20,925 15,068

Transfer to Debenture Redemption Reserve (1,935) --

Dividend - Final (paid for the year 2007-08)* - (1)

- Interim (Paid) - (487)

- Final (Proposed) (428) --

Tax on dividend - On interim dividend - (83)

- On final dividend (73) --

Transfer to General Reserve (750) (1,000)

Balance carried forward 17,739 13,947

* In respect of equity shares allotted pursuant to ESOP, after 31st March 2008 and before the record date.

DIVIDEND

Your Directors are pleased to recommend a dividend of Rs. 3.50 per Equity Share, payable to those Shareholders whose names appear in the Register of Members as on the Book Closure Date.

The equity dividend for the financial year 2009-10, inclusive of tax on distributed profits would absorb Rs. 501 Million (Rs. 570 Million for the previous year at Rs. 4.00 per Equity Share).

CHANGES IN SHARE CAPITAL

During the year under review, your Company allotted 586,480 equity shares of the face value of Rs. 10 each on the exercise of stock options under its various Employee Stock Option Plans and consequently the number of issued, subscribed and paid-up equity shares has increased from 121,733,634 equity shares to 122,320,114 equity shares of Rs.10 each aggregating Rs. 1,223,201,140.

BUSINESS PERFORMANCE / FINANCIAL OVERVIEW

Your Company is a leading provider of IT, Network Technology solutions and BPO services to the telecommunications industry in India. During the year, your Company was ranked by NASSCOM as the fifth largest Indian IT services company, in terms of export revenues and Voice & Data (V&D100, June 2009) ranked your Company as the number one company in telecom software services in India. Your Company has augmented its capabilities by adding service offerings in IT and other areas in which its customers have significant expenses. Your Companys strategy is now based on the "six pillars" of significant expenditure within its customer base namely, IT applications, Network Technology Solutions and Services, BPO, Infrastructure Management Services, Security Services and Value Added Services. Your Companys services span a wide range, from applications development and maintenance, solution integration, network services, remote infrastructure management, BPO, product engineering and lifecycle management and testing to high end, higher vaJue added offerings such as consulting, managed platforms and managed services. Your Company provides these services to its clients in the form of telecommunications specific offerings and through a delivery model which efficiently combines service delivery with domain knowledge.

Your Company has emerged as the leading telecommunications focused BPO company which caters to the diverse needs of the telecommunications eco-system.Your Company continues to invest in developing service offerings in areas like network services, infrastructure management, security services and VAS.

During the year under review, your Company has also been able to address the various technological changes in the industry, and has invested in the ability to provide solutions that support voice- data convergent systems and next generation services. Your Companys capabilities have been strengthened through its involvement in major transformation initiatives of its key customers.

During the year under review, your Company has also broadened its relationship with its key customers by expanding its service offerings to cover a wide range of the customers businesses.

As a result of continued focus on its sales & marketing strategy, your Company has developed a 3-layered marketing and delivery structure which enables it to be more responsive to its customers needs. Such a delivery has enabled faster execution of client engagements, delivery of quality of services and facilitated the efficient use of the resource pool.

Your Company now has 13 delivery centers supported by the competency and solutions units and it strongly believes that this model enables it to deliver superior solutions to its clients. Your Company has offices in 25 countries and has clients in over 40 countries.

During the year under review, total income increased to Rs. 45,747 Million from Rs. 43,153 Million in the previous year, a growth of 6%. On a consolidated level, total income increased to Rs. 47,008 Million from Rs. 44,269 Million in the previous year.

During the year, 58.6% of your Companys revenue came from Europe, 29.4% came from USA and 12.0% came from Rest of the World (ROW).

The Profit before interest, depreciation and tax amounts to Rs. 11,726 Million (26% of income) as against Rs. 12,004 Million (28% of income) in the previous year.

As you are aware, during the year your Company acquired a 42.67% shareholding in Satyam Computer Services Limited (Satyam) through Venturbay Consultants Private Limited (Venturbay), a wholly owned subsidiary of your Company with an investment of Rs. 29,695 Million, which was partly funded by borrowings. Consequently, Interest cost during the year substantially increased to Rs. 1,600 Million as dompared to Rs. 25 Million in the previous year.

The Profit before depreciation of your Company stood at Rs. 10,126 Million (which amounts to 22% of its income) as against Rs. 11,980 Million (28% of income) in the previous year.

Profit after tax, before exceptional items was lower at Rs. 7,513 Million as against Rs. 9,866 Million in the previous year. On a consolidated level, profit after tax, before exceptional items stood at Rs. 7,117 Million as against Rs. 10,146 Million in the previous year. A major reason of a low Profit after tax this year was the huge interest cost of Rs.1600 Million on moneys borrowed for Satyam acquisition.

UPDATE ON SATYAM

As reported in the previous years Directors Report, your Company participated in the Satyam bidding process, through its wholly owned subsidiary, Venturbay, and was declared as the highest bidder on 13th April 2009 and as the winning bidder post approval by the Honourable Company Law Board on 16th April 2009.

Satyam is one of the largest Indian IT software and services companies with a well-diversified client base spread across Banking, Financial Services & Insurance (BFSI), manufacturing, retail, transport, logistics, telecom, media, healthcare and pharma etc. The Company believes that the acquisition presented a compelling strategic opportunity. The rationale behind the acquisition was :

Diversification into multiple verticals like Banking and Insurance, Manufacturing and Retail

Ability to offer a wider range of service offerings like Enterprise Services and Engineering Services to current and future customers

Derisked business model with balanced exposure across geographies and currencies

Utilize Mahindra Satyams pool of highly experienced, well- trained professional employees

Scale benefits due to substantially larger size of the business

Post acquisition, the new management of Satyam has brought about significant changes in operating policies and procedure to facilitate the revival of the company.

The consolidated financial statements included in this report do not include the financial statements of Satyam and its subsidiaries as Satyam is in the process of restating its financials. The Honourable Company Law Board vide its order dated 15th October 2009 has given extension of time to Satyam for filing of returns/ documents which are required to be filed with various statutory authorities under various statues, whether already due, or to become due, upto 30th June 2010.

RECENT MATERIAL CHANGES

During the year, pursuant to an agreement, Mahindra-BT Investment Company (Mauritius) Limited (MBTM), a subsidiary of your parent company, Mahindra & Mahindra Limited (M&M) sold 98,70,912 Equity Shares of your Company aggregating 8.07% of its paid-up Equity Share Capital.

Following the said sale, the Shareholding of M&M alongwith its subsidiary MBTM in your Company stands reduced to 44.01%, resulting in your Company ceasing to be a subsidiary of M&M.

Consequently, the subsidiaries of your Company, viz. Mahindra Logisoft Business Solutions Limited,Tech Mahindra (Americas) Inc., Tech Mahindra GmbH,Tech Mahindra (Singapore) Pte. Limited,Tech Mahindra (Thailand) Limited, Tech Mahindra Foundation, PT Tech Mahindra Indonesia, CanvasM Technologies Limited, CanvasM (Americas) Inc., Tech Mahindra (Malaysia) Sdn. Bhd,Tech Mahindra (Beijing) IT Services Limited, Tech Mahindra (Nigeria) Limited, Tech Mahindra (Bahrain) Limited (S.P.C.) and Venturbay Consultants Private Limited have also ceased to be subsidiaries of M&M.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

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

QUALITY

Your Company continues its focus on quality through a very robust process framework implementation. Continuous process improvements in developing solutions that meet client expectations is a way of life in your Company. The objective is to ensure greater customer satisfaction through improved quality, higher productivity and reduced cycle time.

This was further strengthened during the year under review, as your Company achieved another accreditation on the global standard for Business Continuity Management BS25999:2008 in addition to the Information Security standard ISO/IEC27001:2005 and other accreditations like ISO 9001:2008, ISO/IEC 20000-1:2005, SEI-CMMI Level 5 v1.2, P-CMM Level 5 and SSE-CMM Level 3. Your Company is the third in the world to have been appraised for SSE-CMM Level 3.

HUMAN RESOURCES

During the Financial Year 2009-10, your Company, along with its subsidiaries, made a net addition of 8,552 to its workforce. The strength was 33,524 as at 31st March 2010, as compared to 24,972 a year before, registering an increase of 34%. BPO headcount included in this figure also registered a growth of 114 % as the headcount went up to 8,067 from 3,769, a year before.

Talent Management

Your Company believes in nurturing talent, motivating indigenous innovation and promoting leadership development. Your Companys talent management and leadership development programs have been running for several years and your Companys employees look forward to participating in them.

This year, your Company initiated two new talent management programs.The Mature Talent program is designed to tap the talent which employees bring in from different industries.The participants in this program are typically employees who have experience in other industries and which help incubate best practices across industries. The Yuva Neta (YuN) program will focus on mentoring your Companys young graduate leaders at an early stage of their career.

The Global Leadership Cadre (GLC) program, which your Company has been running for the past five years, continues to infuse fresh ideas and young talent into your Company. Participants in this program are typically management graduates from Tier I Business institutes across the globe and select technical specialists from within the organization. These highly talented participants have demonstrated the ability to learn quickly and we have been able to provide them faster career progression.This program has helped your Company to create a pool of highly talented candidates who can also be successors to senior management in the organization.

Complementing the GLC program is the Management Trainee (MT) program in which candidates from Business Schools across India are recruited and groomed for future GLC roles.

SUBSIDIARY COMPANIES

As reported earlier, your Company participated in the Satyam bidding process, through its wholly owned subsidiary, Venturbay, and was declared as the highest bidder on 13th April 2009 and as the winning bidder post approval by the Honourable Company Law Board on 16th April 2009. In order to fund Venturbays investment into Satyam, your Company infused Rs. 30,461 Million in Venturbay during the year under review.

During the year under review, your Company acquired the entire share capital of Mahindra Logisoft Business Solutions Limited (MLBSL). Consequently, MLBSL became a wholly owned subsidiary of your Company w.e.f. 11th April 2009.

During the year under review, Tech Mahindra (Nigeria) Limited and Tech Mahindra (Bahrain) Limited (S.P.C.) became subsidiaries of your Company.

As on 31st March 2010, your Company had 14 subsidiaries, including one step-down subsidiary.There has not been any material change in the nature of the business of the subsidiaries. As required under the Listing Agreements with the Stock Exchanges, the Consolidated Financial Statements of your Company and all its subsidiaries are attached. The Consolidated Financial Statements have been prepared in accordance with Accounting Standards AS 21, AS 23 and AS 27 issued by The Institute of Chartered Accountants of India and show the financial resources, assets, liabilities, income, profits and other details of your Company and its subsidiaries and associate companies as a single entity, after elimination of minority interest. The consolidated financial statements included in this report do not include the financial statements of Satyam and its subsidiaries as Satyam is in the process of restating its financials.

The Company has made an application to the Ministry of Corporate Affairs seeking exemption from attaching the copy of Balance Sheet, Profit and Loss Accoupt, Reports of the Board of Directors and Auditors of the subsidiaries with the Balance Sheet of the Company. If, in terms of approval granted by the Ministry of Corporate Affairs under section 212(8) of the Companies Act, 1956, the Copy of the Balance Sheet, etc. of the subsidiaries are not required to be attached with the Balance Sheet of the Company, the Company Secretary will make these documents available upon receipt of request from any member of the Company interested in obtaining the same. These documents will be available at Registered Office / Corporate Office of the Company and the office of the respective subsidiary companies, during working hours up to the date of the Annual General Meeting.

EMPLOYEE STOCK OPTION PLAN

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

CORPORATE SOCIAL RESPONSIBILITY (CSR)

Your Company is committed to play its role as an enlightened corporate citizen and continued to earmark 1% of its Profit After Tax (PAT) every year on CSR activities. Going forward, your Company proposes to increase this contribution to 1.5% of its PAT every year. CSR activities are mainly carried through Tech Mahindra Foundation (TMF).TMF focuses on activities for Social and Inclusive Development mainly in the area of education, particularly education of the girl child. The Foundation has a corpus of Rs. 389 Million and has spent approximately Rs. 72 Million during the year under review to achieve its objectives.

The Foundation seeks to make a contribution towards provision of quality education and vocational skills to the economically disadvantaged, physically challenged and other vulnerable sections of society. Women empowerment and the educational needs of the girl child are special areas of concern to TMF. Recognizing that the great majority of children from under-privileged background study in municipal schools, TMF seeks to work towards improvement of these schools. Aware that youth who have studied in vernacular schools are often handicapped in their efforts to move ahead on account of lack of English language skills, TMF is endeavoring to help them meet this challenge.

During the year under review, the Foundation selected several new not-for-profit organizations spread over Pune, Mumbai, Noida, Delhi and Bangalore. It now works with 50 NGOs enabling it to reach out to many more children, with special attention to the educational needs of such vulnerable sections as girls from economically disadvantaged minority families.

TMF has made a special effort to link up with organizations making innovative use of technology to reach out to the needs of the physically, particularly visually challenged. TMF has also partnered with many vocational training institutes to give loans and scholarships which would help economically challenged but deserving students to pursue their education.

TMF continued to honour outstanding teachers and principals working in the Municipal schools of Delhi. These were selected through a rigorous and independent process. Mr. Vineet Nayyar, Vice Chairman of your Company and Director of TMF distributed the awards to 30 teachers on 7th April 2010 at a ceremony attended by the Municipal Commissioner of Delhi.

There is an increasing amount of interest shown by our employees to volunteer and utilise their free time to help partner NGOs of the Foundation.

The ESRO (Employee Social Responsibility Options) initiative, which was launched during the year under review by your Company in collaboration with TMF has had employees presenting proposals for supporting NGOs/charitable organizations working in the fields of education, health, environment and child welfare with your Company providing financial aid to these organizations.

SUSTAINABILITY

As a part of a responsible business Group having a global presences, your Company has taken considerable steps in responding to the challenges of Climate Change and Global Warming and transparently reporting its Sustainability or the triple bottom line performance i.e. performance towards the environmental, societal as well as economic aspects, so as to create sustainable value for all its stakeholders.

Your Company has been participating in the Sustainability Reporting of the Mahindra Group since FY 2007-08. During the year under review the 2nd Sustainability Report for the year 2008-09 was released. Both these reports were in accordance with the latest guidelines of the internationally accepted, Global Reporting Initiative (GRI). This report was assured by Ernst & Young and conforms to the highest level for reporting Sustainability performance, which is A+.The report and the performance rating of A+ was checked and confirmed by GRI. *(GRI is a Netherlands based multi-stakeholder network of thousands of experts worldwide, which has pioneered the development of the worlds most widely used sustainability reporting framework. United Nations is one of its key stakeholders. This reporting framework sets out the principles and indicators that organizations can use to measure and report their economic, environmental, and social performance.) The detailed Group Sustainability Reports are available on the website http://www.mahindra.com/sustainability/ sustainability-index.html

In order to take a structured path for reducing its carbon footprint, your Company has developed a 5 Year Sustainability Road map. This would help in consciously reducing GHG emissions and waste, as well as conserve water, bio-diversity and natural resources. Hence during the FY 09-10 concerted efforts were made to ensure that the targets are met over the committed time horizon with the following thrust areas:

• The new Campus at Hinjewadi near Pune, has been developed with a focus on Sustainability principles, the important ones being

Renewable energy using Wind & Solar for generating electricity for the utility block.

Rainwater Harvesting & Sewage Treatment Plant.

Eco-friendly e-waste disposal systems.

• Since awareness of these challenges is a major issue, focused efforts were made to enhance the awareness of employees as well communities around which we operate by conducting simple online tests to organizing Green walkathon & Cycle rallies and training school teachers on Climate Change & Environment who in-turn educate the children on these concerns.

Carbon foot-printing exercise to inventorize GHG emissions from all our business operations, under scope I, II & III emissions as per internationally accepted standards was carried out. This will enable us to baseline data on our emissions and undertake initiatives towards improving performance in this area.

These will be reported in our 3rd Sustainability Report, which will be released shortly.

CORPORATE GOVERNANCE PHILOSOPHY

Your Company believes that Corporate Governance is a voluntary code of self-discipline. In line with this philosophy, it follows healthy Corporate Governance practices and reports to the shareholders the progress made on the various measures undertaken. Your Directors have reported the initiatives on Corporate Governance adopted by your Company in the section Corporate Governance in the Annual Report.

DIRECTORS

Mr. Vineet Nayyar, Mr. Ulhas N. Yargop and Hon. Akash Paul retire by rotation and being eligible, offer themselves for re-appointment.

During the year under review, Mr. Clive Goodwin and Mr. Arun Seth, nominees of British Telecommunications pic. resigned as directors with effect from 22nd January 2010. Mr. Paul Ringham, who was the Alternate Director to Mr. Clive Goodwin, also relinquished his office with effect from 22nd January 2010. Mr. Al-Noor Ramji, nominee of British Telecommunications pic, resigned as a Director with effect from 31st March 2010.The Board places on record its sincere appreciation for the services rendered by Mr. Goodwin, Mr. Seth, Mr. Ringham and Mr. Ramji to the Company.

Mr. Nigel Stagg and Mr. Richard Cameron, nominees of British Telecommunications pic. were appointed as Directors in the vacancy caused by the resignation of Mr. Clive Goodwin and Mr. Arun Seth at the Meeting of the Board of Directors held on 22nd January 2010.

Mr. Nigel Stagg holds office upto the date of the forthcoming Annual General Meeting as Mr. Clive Goodwin, in whose place he has been appointed, would have retired by rotation at the forthcoming Annual General Meeting.

The Company has received a Notice from a Member under section 257 of the Companies Act, 1956, signifying his intention to propose Mr. Nigel Stagg for the office of Director.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to section 217(2AA) of the Companies Act, 1956, your Directors, based on the representation received from the Operating

Management and after due enquiry, confirm that:

i. in the preparation of the annual accounts, the applicable accounting standards have been followed;

ii. they have, in the selection of the accounting policies, consulted the Statutory Auditors and these have been applied consistently and reasonable and prudent judgments and estimates have been made so as to give a true and fair view of the state of affairs of the Company as at 31st March 2010 and of the profit of the Company for the year ended on that date;

iii. proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

iv. the annual accounts have been prepared on a going concern basis.

AUDITORS

M/s. Deloitte Haskins & Sells, Chartered Accountants, the Auditors of your Company, hold office up to the conclusion of the forthcoming Annual General Meeting of the Company and have given their consent for re-appointment. The shareholders will be required to elect auditors for the current year and fix their remuneration. Your Company has received a written confirmation from M/s. Deloitte Haskins & Sells, Chartered Accountants to the effect that their appointment, if made, would be in conformity with the limits prescribed in Section 224 of the Companies Act, 1956. The Board recommends the re-appointment of M/s. Deloitte Haskins & Sells, Chartered Accountants as the Auditors of the Company.

CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION

In view of the nature of activities that are being carried on by your Company, Rules 2A and 2B of the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, concerning conservation of energy and technology absorption, respectively are not applicable to your Company. Your Company being a software solution provider requires minimal energy consumption and every endeavour has been made to ensure the optimal use of energy, avoid wastage and conserve energy as far as possible.

FOREIGN EXCHANGE EARNINGS AND OUTGO

The foreign exchange earnings of your Company during the year were Rs. 51,265 Million (Previous Year Rs. 42,792 Million), while the outgoings were Rs. 17,726 (Previous Year Rs. 15,554 Million). During the year under the review, 96.90 % of your Companys revenues were derived from exports.

PARTICULARS OF EMPLOYEES

The information required under Section 217(2A) of the Act and the Rules made thereunder, is provided in an Annexure to this Report. However, as per the provisions of Section 19(1)(b)(iv) of the Companies Act, 1956, the Directors Report being sent to the shareholders does not include this Annexure. Any shareholder interested in perusing a copy of the Annexure may write to the Company Secretary at the Registered Office / Corporate Office of the Company.

DEPOSITS AND LOANS/ADVANCES

Your Company has not accepted any deposits from the public or its employees during the year under review. The particulars of loans/advances and investment in its own shares by listed companies, their subsidiaries, associates, etc., required to be disclosed in the annual accounts of the Company pursuant to Clause 32 of the Listing Agreement are furnished separately.

AWARDS/RECOGNITION

Your Company continued its quest for excellence in its chosen area of business to emerge as a true global brand. Several awards and rankings continue to endorse your Company as a thought leader in telecom industry.

Awards for the year

AT&T 2010 Supplier Award :TechM was one of the six vendors and only IT Company to win the award.

Best System Integrator Award 2010 by CMAI & INFOCOMs National Telecom Awards 2010

• Leapvault Change Management Leadership Award 2010 for the acquisition of Satyam

Amity Excellence Award for strategic HR for the year 2009

Voice & Data ranked Tech Mahindra 1st in the "Telecom Software" category in V&D 100 Ranking 2009

IAOP ranked Tech Mahindra in the Leaders Category in the Annual Listing of the Worlds Best Outsourcing Service Providers the 2010 Global Outsourcing 100 - "2010 Global Outsourcing 100"

Gartner ranked Tech Mahindra 11th largest TOMS Vendor in Market Share: Telecoms Operations Management Systems - Worldwide, 2006-2008, May 2009

NASSCOM ranked Tech Mahindra amongst the top 50 NASSCOM Innovators for the Year 2009

ACKNOWLEDGEMENTS

Your Directors gratefully acknowledge the contributions made by employees towards the success of your Company. Your Directors are also thankful for the co-operation and assistance received from its customers, vendors, bankers, regulatory and Governmental authorities in India and abroad and its shareholders.

For and on behalf of the Board

Mumbai Anand G. Mahindra

Date : 29th May 2010 Chairman


Mar 31, 2000

The Directors have pleasure in presenting their Tenth Report together with the audited accounts of your Company for the year ended March 31, 2000.

Summarised Financial Results Rs. in lakhs

2000 1999

Income from Operations 11,857.48 9,530.32

Less: Finance Costs 5,875.17 4,367.15

Expenditure 2,605.67 1,992.24

Depreciation 2,031.07 2,100.93

10,511.91 8,460.32

Profit before tax 1,345.57 1,070.00

Less: Provision for tax 804.25 617.20

Profit after tax 541.32 452.80

Less : Short provision for income-tax - earlier years (0.12) -

541.20 452.80



Add : Amount brought forward from previous year 271.15 280.33

Amount available for appropriation 812.35 733.13

Appropriations:

General Reserve - 25.00

Special Reserve 108.27 90.60

Dividend on 11.25% Preference Shares redeemed on 9th October, 1998 - 53.36

Income Tax on Preference Dividend - 5.33

Dividend on Equity Shares (interim) 216.69 -

Income Tax on Dividend (interim) 23.84 -

Proposed Dividend on Equity Shares (final) 43.34 259.18

Income Tax on Proposed Dividend (final) 9.53 28.51

Surplus carried to Balance Sheet 410.68 271.15

812.35 733.13

Interim Dividend

An interim dividend @ 5% on equity shares of Rs.10 each has been declared and paid as follows to those members whose names appeared on the Register of Members as on March 31, 2000, being the record date fixed for the purpose:

Rs. in lakhs

(a) A dividend of Re. 0.50 per share on 3,19,03,231 equity shares of Rs. 10 each 159.52

(b) A pro-rata dividend of Re. 0.289 per share on 46,18,508 equity shares of Rs. 10 each allotted on 02.09.99 13.37

(c) A pro-rata dividend of Re. 0.251 per share on 46,04,144 equity shares of Rs. 10 each allotted on 30.09.99 11.57

(d) A pro-rata dividend of Re. 0.165 per share on 1,94,97,420 equity shares of Rs. 10 each allotted on 02.12.99 32.23

Total 216.69

Final dividend

Your Directors have recommended a final dividend of 1 % per equity share of Rs. 10 each payable as follows to those members whose name appear on the Register of Members as on July 17, 2000:

Rs. in lakhs

(a) A dividend of Re. 0.10 per share on 3,19,03,231 equity shares of Rs. 10 each .. 31.90

(b) A pro-rata dividend of Re. 0.058 per share on 46,18,508 equity shares of Rs. 10 each allotted on 02.09.99 2.68

(c) A pro-rata dividend of Re. 0.0502 per share on 46,04,144 equity shares of Rs. 10 each allotted on 30.09.99 2.31

(d) A pro-rata dividend of Re. 0.03306 per share on 1,94,97,420 equity shares of Rs. 10 each allotted on 02.12.99 6.45

Total 43.34

The total Dividend paid/payable by the Company will absorb a sum of Rs.293.40 lakhs including Rs.33.37 lakhs as tax on distributed profits, as against an amount of Rs.346.38 lakhs for the previous year.

Rights Issue and Capital Adequacy

In order to strengthen its capital base, your Company had made Rights Issues amounting to Rs.63.18 crore in a phased manner during the year under review.

Consequent upon the rights issues, the share capital of the Company has increased to Rs.60.62 crore from Rs.31.90 crore and the share premium, to Rs.65.37 crore from Rs.30.91 crore.

As a result of the increased net worth, the Company was able to maintain the Capital to Risk Assets Ratio (CRAR) of 20% as on March 31, 2000 against the required CRAR of 12%. Your Company is thus well placed against any increase that the Reserve Bank of India may prescribe in the Capital Adequacy Ratio following the recommendations of the task force appointed by the Government to review the regulatory frame work for Non Banking Finance Companies.

Holding of Mahindra & Mahindra Limited

Pursuant to the allotments of equity shares under the rights issues during the year, the holding of Mahindra & Mahindra Limited in the share capital of the Company increased from 93.11 % to 95.99% as of March 31, 2000.

Operations

During the financial year 1999-2000, whilst the Automobile industry recorded a moderate growth over the previous year, the Utility Vehicle segment, which your Company mainly caters to, has not shown any significant improvement.

Your Company disbursed Rs.757 crore compared to Rs.505 crore disbursed during the previous financial year [including Rs.211 crore (previous year: Rs.117 crore) towards Tractor Financing to the dealers of Mahindra & Mahindra Limited], registering a growth of over 50%. This was possible mainly due to the Companys strategy of consolidating its position in rural and semi urban markets. Your Company has extended retail finance to automotive sales of Mahindra products and has a client base of over 50,000.

The Company also commenced retail tractor financing operations during the current financial year in Rajasthan, Madhya Pradesh and Gujarat.

The income of the Company during the year was Rs. 118.57 crore registering a growth of 24.42% over the previous year. The profit before tax has increased to Rs.13.46 crore from Rs.10.70 crore, a growth of 25.75%. The profit after tax at Rs.5.41 crore is 19.52% higher than the previous years profit of Rs.4.53 crore.

During the year, the Company has added 34 branches, taking the total number of branches to 115 as of March 31, 2000.

Your Directors are pleased to report that the strategic initiatives embarked upon have resulted in another year of impressive growth, both in business and profits.

RBI Inspection

During the current financial year, the Reserve Bank of India had carried out regular onsite inspection of the various records and the systems/procedures followed by the Company and no adverse comments have been received on conclusion of the inspection.

Credit Rating

During the year under review, the Credit Rating Services of India Limited (CRISIL) has, on two occasions, upgraded the Credit Rating assigned to the Companys Fixed Deposit Scheme from "FAA-" to "FAA" and thereafter, to "FAA+". The revised rating indicates that the degree of safety regarding timely payment of interest and principal is strong. Your Company is one of the few companies amongst NBFC companies whose credit rating by CRISIL has been upgraded twice in a year.

CRISIL has also rated the Companys short-term Non Convertible Debentures with "P1+" rating. A" P1+" rating indicates that the degree of safety regarding timely payment on the instrument is very strong. The Companys Long Term Non Convertible Debentures issue of Rs.50 crore was rated "Ind AA+" by Duff & Phelps Credit Rating India Private Limited. The rating of "Ind AA+" indicates high credit quality.

Finance

During the year under review, the Company had adopted pro- active financial management policies, which helped it reduce the weighted average cost of its borrowings by 2.6% through a variety of measures such as raising finance through innovative instruments, re-arranging the mix of borrowings, correction of the Asset/Liability mis-match.

The strong financials and enhanced credit rating has made it possible for the Company to arrange adequate external resources in keeping with its growth objective, whilst at the same time, reducing the reliance on borrowings from the parent Company.

Current Year

The new Fiscal Year 2000-2001 has commenced with a cut in the bank rate as well as Cash Reserve Ratio by 1 % in two stages. These measures should benefit the Company in terms of fund availability and associated borrowing costs.

Your Company anticipates a reasonable growth in business, and will continue to provide finance primarily for Mahindra range of vehicles and tractors, with an emphasis on retail sales, particularly in rural and semi urban markets.

Year 2000 (Y2K) Compliance

Due to adequate precautions undertaken by the Company and thorough testing of its various computer hardware systems and application software, your Company had smooth transition into the new millennium.

Corporate Governance

Your Company believes that Corporate Governance is a voluntary code of self-discipline. In line with its policy of self-discipline, the Board of Directors strongly believes that it is very important that the Company should follow healthy Corporate Governance practices and report to the shareholders the progress of various measures undertaken. Although your Company is unlisted, your Directors feel it prudent to initiate reporting on Corporate Governance measures adopted by your Company. The initiatives undertaken by your Company towards better Corporate Governance are summarized below:

Board of Directors

The Company presently has nine Directors against the maximum of twelve Directors permitted by its Articles of Association. All the Directors posses in-depth knowledge of Automotive/Tractor Markets and matters related to financial services business.

Board Meetings

Five Board Meetings were held during the year, at which the Performance Reports, business development plans, Statutory Compliance Certificates and general industry scenario were reviewed and discussed. The Board meetings were well attended. The Senior Executives of the Company are present at meetings of the Board.

Audit Committee

The Board has constituted an Audit Committee on 17th February, 2000 whose terms of reference includes a review of the Companys accounting practices and financial reporting systems, interaction with the Companys Internal and Statutory Auditor, selection of accounting policies and review of the Auditors Report on the Financial Statements. The members of the Audit Sub- Committee are Mr. Uday Kotak (Chairman of the Committee), Mr. Dhananjay Mungale and, Mr. U. Y. Phadke.

Board Committees

The Board periodically delegates matters related to borrowings and share issues for speedy implementation of decisions taken at Board meetings.

Additional Initiatives

We are pleased to summarise the initiatives undertaken by your Company during the last financial year:

a) Strategy Formulation:

In view of the fast changing market scenario, your Company had reviewed its strategy with the assistance of a reputed consulting firm to achieve its strategic business objective.

b) Balanced Scorecard:

The Company is in the process of implementing the Balanced Scorecard approach to implement the formulated strategy by developing appropriate measures of performance.

c) HR Assessment Centre:

Your Company recognises that its employees are its most valuable assets. To identify the areas of development of the employees and to facilitate better career planning for them, your Company will, on an ongoing basis, conduct scientific HR Assessments of its key employees.

d) Customer Relationship Management:

Your Company has devised a process for collecting regular feed-back from its clients. Such feed-back is conveyed to the parent company on a regular basis to help it better plan its product development initiatives.

Your Company regularly conducts surveys to assess the satisfaction level in respect of fixed deposit investors. The feedback of such survey is placed before the Management and is also used to effect improvements in the standards of service. The Company plans to conduct such surveys at regular intervals to maintain high standards of service to Depositors/Investors.

Accounting Standards

The financial statements of your Company comply with the Accounting Standards recommended by the Institute of Chartered Accountants of India as referred to in sub-section (3C) of Section 211 of the Companies Act, 1956. The Company also adheres to the prudential guidelines prescribed by the Reserve Bank of India.

As a good practice, the Company gets its accounts audited on quarterly basis by the Statutory Auditors.

Fixed Deposits

As per the revised RBI guidelines, the. Company can accept Public Deposits upto four times its net owned funds, which works out to Rs. 53717.64 lakhs. Against this, your Company held fixed deposits of Rs.3694.88 lakhs as on March 31, 2000. Out of these deposits, 705 deposits aggregating Rs.110.35 lakhs which had matured as at March 31, 2000, had not been claimed as at the end of the financial year Since then, 112 of these deposits of the value of Rs.18.34 lakhs have been claimed.

Directors

Mr. Anand G. Mahindra, Mr. K. J. Davasia and Mr. Uday Kotak retire by rotation and, being eligible, offer themselves for re- appointment.

Auditors

M/s. B. K. Khare & Co., Chartered Accountants, retire as Auditors of the Company and have given their consent for re-appointment. The shareholders will be required to appoint Auditors for the current year and fix their remuneration.

As required under the provisions of Section 224 of the Companies Act, 1956, your Company has obtained a written certificate from M/s. B. K. Khare & Co., Chartered Accountants to the effect that their re-appointment, if made, would be in conformity with the limits specified in the said section.

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

In view of the nature of activities which are being carried out by the Company, Rules 2A and 2B of the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, concerning conservation of energy and technology absorption respectively are not applicable to the Company.

The information on foreign exchange outgo is furnished in the Notes to the accounts. There were no foreign exchange earnings during the year under review.

Particulars of Employees as required under Section 217(2A) of the Companies Act, 1956, and Rules thereunder

As required under Section 217(2A) of the Companies Act, 1956 and Rules thereunder, a statement containing particulars of the Companys employees who were in receipt of remuneration of not less than Rs.6,00,000 during the year ended March 31, 2000 or of not less than Rs.50,000 per month during any part of the said year is given in the Annexure to this Report.

For and on behalf of the Board

Anand G. Mahindra Chairman

Mumbai, 28th April, 2000

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