Directors Report of Escorts Kubota Ltd.

Mar 31, 2025

Your Directors have pleasure in presenting this Integrated Annual Report/ Annual Report (''IAR''/ ''AR'') of the Escorts Kubota
Limited (''Escorts'' or ''EKL'' or ''Company'') along with the Company''s audited financial statements (standalone and consolidated)
for the financial year ended on March 31,2025.

Financial Results

	Standalone		Consolidated
Particulars	Year ended on March 31, 2025	Year ended on March 31, 2024 (Restated)*	Year ended on March 31, 2025	Year ended on March 31, 2024 (Restated)*
Revenue from operations	10,186.96	9,730.72	10,243.88	9,803.59
Other income	458.39	391.50	461.31	391.78
Total Income	10,645.35	10,122.22	10,705.19	10,195.37
Profit from operations before Interest, Depreciation, Exceptional Items & Tax	1,636.23	1,524.52	1,625.50	1,522.15
Finance Cost	27.03	38.78	29.17	41.66
Profit from operations before Depreciation, Exceptional Items & Tax	1,609.20	1,485.74	1,596.33	1,480.49
Depreciation & Amortisation	242.61	223.60	243.65	224.06
Profit from operations before Tax and exceptional items	1,366.59	1,262.14	1,352.68	1,256.43
Exceptional Items	(27.08)	-	(1.67)	-
Profit before Tax from Continuing Operations	1,339.51	1,262.14	1,351.01	1,256.43
Tax Expense from Continuing Operations	229.48	314.11	226.95	313.40
Net Profit for the period from Continuing Operations	1,110.03	948.03	1,124.06	943.03
Net Profit for the period from Discontinued Operations	140.89	133.59	140.89	133.59
Net Profit for the period	1,250.92	1,081.62	1,264.95	1,076.62

Financial Performance/ State of Company Affairs

The brief highlights of the Company''s performance
(Standalone) for the financial year (‘FY'') ended March
31,2025 are:

'' 10,645.35 crores

Total income of the Company for FY 2024-25 stood at
'' 10,645.35 crores ('' 10,122.22 crores in FY 2023-24)

'' 1,636.23 crores

Profit from operations before Interest, Depreciation,
Exceptional Items & Tax stood at '' 1,636.23 crores.

'' 1,366.59 crores

Profit from operations before Tax (PBT) and
exceptional items stood at '' 1,366.59 crores. Net
profit for the period stood at '' 1,250.92 crores.

Our Company sold 1,15,554 tractors during the year under
review as against 1,14,396 tractors sold during the last
financial year.

The brief highlights of the Company''s performance
(Consolidated) for the financial year ended March 31, 2025
are:

• Total income of the Company for FY 2024-25 stood at
'' 10,705.19 crores ('' 10,195.37 crores in FY 2023-24)

• Profit from operations before Interest, Depreciation,
Exceptional Items & Tax stood at '' 1,625.50 crores.

• Profit from operations before Tax (PBT) and exceptional
items stood at '' 1,352.68 crores. Net profit for the
period stood at '' 1,264.95 crores.

*The figures of last financial year ended on March 31,
2024 have been restated giving the impact of scheme of

amalgamation among and between Escorts Kubota India
Private Limited, Kubota Agricultural Machinery India Private
Limited with the Company, as approved by the Hon''ble
National Company Law Tribunal (''NCLT''), Chandigarh Bench,
vide its order dated August 21,2024.

The details on the individual businesses of the Company are
provided in the Management Discussion & Analysis section
provided in this annual report.

Management Discussion & Analysis

In terms of the provisions of Regulation 34 of SEBI (Listing
Obligations and Disclosure Requirements) Regulations, 2015
(hereinafter referred as the ''SEBI Listing Regulations''), the
Management Discussion and Analysis is set out in this Annual
Report and provides a detailed analysis on the performance
of individual businesses and their outlook.

Dividend

During the FY 2024-25, the Board of Directors of the
Company at its meeting held on February 10, 2025 has
declared the interim dividend @ 100% per share of face value
of '' 10/- each (i.e. '' 10/- per share) for the financial year
ended March 31,2025 and the record date for the purpose
of interim dividend was February 14, 2025.

Further, based on the Company''s performance, your Directors
are pleased to recommend, for approval of the members,
the final dividend @ 180% per share of face value of '' 10/-
each (i.e. '' 18/- per share) for the financial year ended March
31, 2025, payable on all outstanding shares after deducting
applicable tax thereon.

The dividend payout is subject to the approval of members at
the ensuing Annual General Meeting (''AGM'').

The record date for the purpose of dividend will be July 04,
2025.

The total dividend for the FY ended March 31, 2025 works
out to 280% per share of face value of '' 10/- each (i.e. '' 28
per share).

The dividend payout for the period under review has been
formulated in accordance with shareholders'' aspirations
and the Company''s Dividend Distribution Policy to pay
sustainable dividend linked to long-term growth objectives of
the Company to be met by internal cash accruals.

The dividend distribution policy is available on the following
web link https://www.escortskubota.com/new/pdf/reg-46-
sebi/24-02-2025/2024 05 09 Dividend-Distribution-Policv.
pdf.

Transfer to Reserves

During the financial year ended March 31,2025, no amount
(previous year: nil) transferred to general reserves.

Further, the movement in Reserves and Surplus is provided in
note 17 of standalone and note 18 of consolidated financial
statements.

Employee Stock Option Scheme

The Escorts Employees Stock Option Scheme (''ESOS'') is
in line with the SEBI (Share Based Employee Benefits and
Sweat Equity) Regulations, 2021 (''SEBI SBEB Regulations'').

The other details pertaining to the ESOS are provided in
note 38 of the Notes to Accounts of Standalone Financial
Statement of the Company.

The Scheme is being implemented in accordance with the
SEBI SBEB Regulations and the resolution(s) passed by
the members. The Secretarial Auditors Certificate would be
available during the Annual General Meeting for inspection
by the members. The details as required to be disclosed
under the Companies Act, 2013 (hereinafter referred as “the
Act”) and/ or SEBI SBEB Regulations would be available on
weblink at https://static.escortskubota.com/images/other-
documents/2025/EKL 2025 05 08 ESOP Disclosure
Reg 14.pdf

Change in Share Capital

During the FY 2024-25, the Company allotted 13,79,493 Equity
Shares of nominal value '' 10/- each, pursuant to the Scheme
of Amalgamation (''Scheme'')among and between Escorts
Kubota India Private Limited, Kubota Agricultural Machinery
India Private Limited with the Company as approved by
Hon''ble NCLT, Chandigarh Bench vide its order dated August
21, 2024. Consequently, the paid-up equity share capital of
the Company, after said allotment, stood at '' 1,11,87,77,540/-
consisting of 11,18,77,754 equity shares of '' 10/- each.

Further, pursuant to the Scheme, the authorised share
capital of the Company increased to '' 16,39,00,00,000/-
(Rupees one thousand six hundred and thirty-nine crores
only) consisting of 75,10,00,000 (Seventy five crore and ten
lakh) Equity Shares having face value '' 10 (Rupees Ten only)
each and 88,80,00,000 (Eighty eight crore and eighty lakh)
unclassified shares of '' 10/- (Rupees Ten only) each.

Merger & Amalgamation

Your Directors have pleasure to inform you that the during
the FY 2024-25, the Scheme of Amalgamation (“Scheme”)
among and between Escorts Kubota India Private Limited,
Kubota Agricultural Machinery India Private Limited with the

Company, under Sections 230 to 232 and other applicable
provisions of the Companies Act, 2013 and the rules framed
thereunder, has been approved by the NCLT, Chandigarh
Bench, vide its order dated August 21,2024.

Accordingly, the Scheme became effective w.e.f. September
01,2024 i.e. upon filing of said NCLT Order with Registrar of
Companies, NCT of Delhi & Haryana.

Divestment

In line with Company''s strategic focus on the agri and
construction equipment sectors and aligning with the vision
of the parent company i.e. Kubota Corporation, the Company
has executed the Business Transfer Agreement with Sona
BLW Precision Forgings Limited (''Sona Comstar'') on October
23, 2024 for transferring the existing Railway Equipment
Business Division (''RED'') as going concern, on slump sale
basis, for a lumpsum cash consideration of '' 1,600 crores
(Indian Rupees One Thousand and Six Hundred crores Only),
without values being assigned to the individual assets and
liabilities.

Further, on February 10, 2025 the Company has entered
into an amended and restated business transfer agreement
with Sona Comstar to amend certain terms and conditions
of the initial agreement including revision in expected date of
completion of sale/ transfer of RED Business from September
30, 2025 to May 01,2025.

Further, the Company has also entered into an agreement to
sell with Sona Comstar on February 10, 2025 for the sale/
transfer of the Company''s spare part division land and building
measuring 33,423 (Thirty three thousand four hundred twenty
three) square yards equivalent to 27,945.885 (Twenty seven
thousand nine hundred forty five point eight eight five) square
meters, forming part of the RED division industrial plot
bearing no. 115 and half of plot no. 114 located in Sector
24, Faridabad, Haryana for a total sale consideration of '' 110
crores (Indian Rupees One Hundred and Ten crores only).

Further, pursuant to sale of land to Sona Comstar, the
Company has shifted its operations pertaining to spare part
division business from Sector 24, Faridabad, Haryana to
Apeejay Global Industrial & Logistics Park, Building No. 09
(Shed No. 2.3), 23/5 Milestone, Delhi Mathura Road,
Ballabhgarh, Haryana - 121004.

Utilisation of Funds

During the FY 2024-25, the fund of '' 1,041.903 crore raised on a preferential basis on July 16, 2020 has been fully utilised for the
purpose for which it was raised i.e. inter-alia for the Agri Machinery Business of the Company and there has been no deviation or
variation in utilisation of this fund.

Further, the details of utilisation of funds of '' 1,872.745 crore raised on February 18, 2022 on a preferential basis, as on March
31,2025, are as follows:

Original Object	Modified Object, if any	Original Allocation	Modified allocation, if any	Funds Utilised	Amount of Deviation/ Variation for the quarter according to applicable object	Remarks if any
For expansion of its agri-machinery business of manufacturing, assembly, sales, marketing, financing, servicing, research and development of: (a) tractors; (b) combine harvester & rice transplanter; (c) utility vehicles; (d) turf equipment; (e) construction machinery; (f) engines; (g) implements; (h) transmission for tractors, construction equipment and implements; (i) other farm mechanisation equipment; (j) spare parts of the items referred in (a) to (i) above	Not Applicable	'' 1,855.306 crore*	Nil	'' 131.168 crore	Nil

Directors and Key Managerial Personnel

In accordance with the provisions of the Companies Act, 2013
(hereinafter referred as ''the Act'') and Articles of Association
of the Company, Mr. Bharat Madan (DIN: 00944660) and
Ms. Nitasha Nanda (DIN: 00032660) Directors of the Company,
retire by rotation at the ensuing AGM and being eligible, offer
themselves for re-appointment. The shareholders at the
AGM held on July 18, 2024, had appointed Mr. Sunil Kant
Munjal (DIN: 00003902) and Ms. Tanya Arvind Dubash (DIN:
00026028) as Independent Directors for second term for 5
years and Mr. Kinji Saito (DIN: 00049067) as an Independent
Director for a term for 5 years in place of Mr. Kenichiro
Toyofuku (DIN: 08619076), who had resigned due to his pre¬
occupation in other professional assignment. The resignation
letter of Mr. Toyofuku states that there is no material reason
other than the reason stated in the resignation letter. The
shareholders at AGM held on July 18, 2024, had also re¬
appointed Ms. Nitasha Nanda as Whole-time Director for a
further period of 3 year.

Further, the tenure of Mr. Harish Narinder Salve (DIN:
01399172), Independent Director is going to end on July 15,
2025 i.e. completing his first term. The Board of Directors,
on recommendation of Nomination, Remuneration and
Compensation Committee (''NRC''), in their meeting held on
May 08, 2025 had recommended the re-appointment of
Mr. Salve as an Independent Director for second term for
5 years for approval of members of the Company as a special
resolution at the ensuing AGM.

Mr. Vicky Chauhan, Compliance Officer of the Company has
resigned w.e.f. February 10, 2025 due to his pre-occupancy
and in his place Mr. Arvind Kumar, Company Secretary
and Key Managerial Personnel of the Company, has been
appointed as a Compliance Officer of the Company w.e.f.
February 10, 2025.

The Company has received declarations from all Independent
Directors of the Company that they meet the criteria of
independence as prescribed under sub-section (6) of
Section 149 of the Act and under Regulations 16 and 25
of SEBI Listing Regulations and there has been no change
in the circumstances affecting their status as independent
directors of the Company. The Company has also received a
declaration from all the independent directors that they have
registered their names in the independent director data bank
and pass/ exempt requisite proficiency test conducted by
Ministry of Corporate Affairs.

In the opinion of the Board, the Independent Directors of the
Company are the persons of integrity, expertise and fulfil the
conditions as per the applicable laws and are independent of
the management of the Company.

The Board at its meeting held on February 10, 2025 has
reviewed and made requisite amendment(s) in the Policy
on Appointment and Removal of Director''s and Members
of Senior Management. The Policy on Appointment and
Removal of Director''s and Members of Senior Management
and Remuneration Policy for Director''s, Key Managerial
Personnel, Senior Management and other Employees are
enclosed as Annexure A and Annexure B respectively and
forms an integral part of this Report.

Annual performance evaluation of the Board, its committees,
individual directors (including independent directors) and
Chairman of the Company pursuant to the provisions of the
Act and the Corporate Governance requirements under SEBI
Listing Regulations have been carried out in accordance with
the Policy. The process, and result of performance evaluation
given in Corporate Governance Report, was followed by
the Board for evaluation of its own performance and its
committees and individual directors including independent
directors and Chairman of the Company.

The Company has devised a process whereby various
presentations/ programmes are being conducted to familiarise
the directors with various developments at industry level,
new business initiatives and organisation strategies, policy
on Business Responsibility & Sustainability etc. The details
of programme for familiarisation of independent directors
with the Company, their roles, rights, responsibilities in the
Company, nature of industry in which the Company operates,
business model of the Company and related matters are
put up on the website of the Company - https://www.
escortskubota.com/investors/regulation-46-of-sebi.

The Company recognises and embraces the importance
of a diverse board in its success. Your Company believes
that a truly diverse board will leverage differences in
thought, perspective, knowledge, skill, regional and
industry experience, cultural and geographical background,
age, ethnicity, race and gender, which will help it retain its
competitive advantage.

The brief resumes, rationales and justifications wherever
applicable and other details relating to the director who
are proposed to be appointed/ re-appointed, as required
to be disclosed as per the provisions of the SEBI Listing
Regulations/ Secretarial Standard are given in the Annexure
to the Notice of the 79th AGM.

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

The particulars relating to conservation of energy, technology
absorption, foreign exchange earnings and outgo, as
required to be disclosed under Section 134(3)(m) of the Act
read with Companies (Accounts) Rules, 2014 are enclosed as
Annexure C and forms an integral part of this Report.

Corporate Governance

Corporate Governance is about maximising shareholders
value, ethically and sustainably. At Escorts Kubota the goal
of corporate governance is to ensure fairness for every
stakeholder. Your Company believes that strong corporate
governance is critical to enhancing and retaining investor
trust. Your Company also endeavours to enhance long
term shareholder value and respect minority rights in all its
business decisions.

Your Company reaffirms its commitment to the good
corporate governance practices and has adopted the
Code of Business Conduct which has set out the systems,
processes and policies conforming to international standards.
Pursuant to Regulation 34(3) of the SEBI Listing Regulations,
Corporate Governance Report alongwith a Certificate
regarding compliance of conditions of Corporate Governance
from Company Secretary in Practice are enclosed as
Annexure D and forms an integral part of this Report.
Further, other governance related disclosures are available on
the website of the Company at https://www.escortskubota.
com/investors/governance.

Corporate Social Responsibility (''CSR'')

The key philosophy of all CSR initiatives of the Company
is to make CSR a key business process for sustainable
development of the society. The initiatives aim at enhancing
welfare measures of the society based on the immediate
and long term social and environmental consequence of its
activities. The Company intends to undertake other need-
based initiatives in compliance with Schedule VII of the Act.

The CSR Policy may be accessed on the Company''s website
at https://www.escortskubota.com/investors/governance.
During the year, the Company has spent '' 11.72 crores out of
total CSR obligation of '' 17.85 crore for FY 2024-25. Further,
the remaining balance '' 6.13 crore has been deposited in a
separate account in compliance of Section 135(6) of the Act,
which is attributable to ongoing projects conceived during the
financial year. Further, other details are provided in note 29 of
the standalone financial statement.

For constitution and other details of the CSR Committee,
please refer Report on Corporate Governance enclosed as
Annexure D to this Report.

The Annual Report on CSR activities, which include the
salient features of the CSR Policy and change therein, if any,
is enclosed as Annexure E and forms an integral part of this
Report.

Consolidated Financial Statement

The Consolidated Financial Statement have been prepared
in accordance with the Act and Indian Accounting Standard
(IND AS) - 110 applicable to the Consolidated Financial
Statement read with IND AS - 28 on Accounting for
Investments in Associates and IND AS - 31 on Financial
Reporting of Interests in Joint Ventures issued by The Institute
of Chartered Accountants of India. The Audited Consolidated
Financial Statement along with the Auditors'' Report thereon
are annexed with Annual Report

Subsidiaries, Joint Ventures and Associate Companies

In accordance with Section 129(3) of the Act, a statement
containing salient features of the financial statements of the
subsidiary(ies), joint venture(s) and associate(s) companies
in Form AOC - 1 is provided in this Report. The statement
also provides details of performance and financial position of
each of the subsidiaries, joint venture(s) and associates and
their contribution to the overall performance of the Company
during the period under report. Audited financial statements
together with related information and other reports of each
of the subsidiary companies have also been placed on the
website of the Company at https://www.escortskubota.
com/investors/regulation-46-of-sebi/subsidiary-financial-
statements. The Consolidated Financial Statement presented
by the Company include the financial results of its subsidiaries
and associate companies.

In terms of the Company''s Policy on determining ''material
subsidiary'', during the financial year ended March 31,2025,
there is no material subsidiary of the Company whose
turnover or net worth exceeds 10% of the consolidated
turnover or net worth respectively of the Company and its
subsidiary in the immediately preceding Accounting Year.

Further, during the FY 2024-25, there is no cessation of any
subsidiary, joint ventures or associate except Escorts Kubota
India Private Limited and Kubota Agricultural Machinery
India Private Limited, joint ventures companies, which have
been merged with the Company pursuant to scheme of
amalgamation as approved by the Hon''ble NCLT, Chandigarh
Bench, vide its order dated August 21,2024.

Further, during the FY 2024-25, Escorts Kubota Finance
Limited, wholly-owned subsidiary company of the Company
has commenced its business as a non-banking financial
institution without accepting public deposits with effect from
November 26, 2024.

The complete list of subsidiaries, joint ventures and associate companies as on March 31,2025, in terms of the Act and/ or INC
AS is provided herein below:

S. No.	Name of the subsidiary/ associate companies/ joint ventures	Relationship	% of shares/ interest
1.	Escorts Crop Solutions Limited	Subsidiary	100%
2.	EKL CSR Foundation (Formerly Escorts Skill Development)	Subsidiary	100%
3.	Escorts Kubota Finance Limited	Subsidiary	100%
4.	Invigorated Business Consulting Limited (Formerly Escorts Finance Limited)	Subsidiary	67.87%
5.	Farmtrac Tractors Europe Spolka Z.o.o.	Subsidiary	100%
6.	Escorts Benefit and Welfare Trust	Subsidiary	100%*
7.	Escorts Benefit Trust	Subsidiary	100%*
8.	Adico Escorts Agri Equipments Private Limited	Joint Venture	40%
9.	Escorts Consumer Credit Limited	Associate	29.41%

''Beneficial interest.

The details of the above investments/ disinvestment are provided in note 7 of the Notes to Accounts of Standalone Financial
Statement of the Company.

Downstream Investment

During the FY 2024-25, the Company has made total
downstream investment of '' 40 crores to subscribe equity
shares offered under right issue(s) by Escorts Kubota Finance
Limited, wholly-owned subsidiary company of the Company,
in compliance with the applicable provisions of the laws, rules
and regulations. Further, the requisite filing/ intimation and
auditor''s certificate in this regard have been dully completed.

Contracts and Arrangements with Related Parties

All contracts/ arrangements/ transactions entered 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 of
the Company on the materiality of related party transactions
and dealing with related party transactions.

The particulars of contracts or arrangements, with related
parties referred to in Section 188(1) of the Act, in the
prescribed Form AOC-2, is enclosed as Annexure F to this
report and forms an integral part of this Report.

The Policy on materiality of related party transactions and
dealing with related party transactions may be accessed on
the Company''s website at https://www.escortskubota.com/
investors/regulation-46-of-sebi.

Your Directors draw attention of the members to note 46 in
the notes to accounts in the standalone financial statement
and to note 47 in the notes to accounts in the consolidated
financial statement which sets out related party disclosures.

Auditors and Auditors’ Report
Statutory Auditors

Pursuant to the provisions of Section 139 of the Act read
with rules thereunder, the shareholders of the Company at
the 76th AGM held on July 14, 2022 had re-appointed M/s.
Walker Chandiok & Co LLP, Chartered Accountants, New
Delhi (Firm Registration No. 001076N/ N500013) as Statutory
Auditors of the Company for a period of 5 years i.e. upto the
conclusion of AGM to be held in the year 2027.

The comments given by M/s. Walker Chandiok & Co LLP,
Chartered Accountants, Statutory Auditors, in their report
read together with notes to Accounts for the FY ended March
31, 2025 are self-explanatory and hence, do not call for any
further explanations or comments under Section 134 of the
Act.

Pursuant to provisions of the Section 143(12) of the Act
neither the Statutory Auditors nor Secretarial Auditors nor
Cost Auditors have reported any incident of fraud to the Audit
Committee or the Board during the FY under review.

Cost Auditors

Pursuant to the Section 148 of the Act read with rules
thereunder, your Company is required to maintain the cost
records and the said cost records are required to be audited.

The Company is maintaining all the aforesaid cost records.

The Board of Directors, on the recommendation of Audit
Committee, has re-appointed M/s. Ramanath Iyer and Co.,
Cost Accountants (Firm Registration No. 000019), as Cost
Auditors of the Company for conducting the audit of cost
records for the FY 2025-26.

The due date of filing the Cost Audit Report for the year ended
on March 31,2024 was September 30, 2024 and the same
had been filed on August 29, 2024.

Secretarial Auditors

The Board had appointed M/s. Jayant Gupta and Associates,
Practicing Company Secretaries, as Secretarial Auditors to
conduct secretarial audit of the Company for the FY 2024-25.

However, due to the casual vacancy in the office of Secretarial
Auditors, upon sudden demise of Mr. Jayant Gupta, sole
proprietor of M/s. Jayant Gupta and Associates on November
12, 2024, M/s. Neelam Gupta & Associates has been
appointed as Secretarial Auditors of the Company for the
FY 2024-25, to hold the office of the Secretarial Auditors
up to the conclusion of AGM to be held in the year 2025.
The Secretarial Audit Report of the Company as prescribed
under Section 204 of the Act is enclosed herewith as
Annexure G and forms an integral part of this Report.

The Secretarial Audit Report does not contain any qualification,
reservation and adverse remarks and the comments given by
the Secretarial Auditors in their report are self-explanatory and
hence, do not call for any further explanations or comments
under Section 204(3) of the Act.

Further, the Board at its meeting held on May 08, 2025, on
the recommendation of Audit Committee, has recommended
the appointment, of M/s. Neelam Gupta & Associates, (Firm
Registration No. S2006DE086800), a peer reviewed firm of
Practicing Company Secretaries as Secretarial Auditors of the
Company for a term of 5 consecutive years from the conclusion
of the ensuing AGM till the conclusion of the AGM to be
held in the year 2030, to the shareholders of the Company
for their approval. The Company has received a letter from
M/s. Neelam Gupta & Associates, Practicing Company
Secretaries confirming that their appointment, if made,
would be within the limits prescribed under SEBI Listing
Regulations and that they are not disqualified for such
appointment under the Act and SEBI Listing Regulations.

Secretarial Audit of Material Unlisted Indian Subsidiary

There is no material unlisted Indian subsidiary of the Company
as on March 31, 2025 and as such the requirement under
Regulation 24A of the SEBI Listing Regulations regarding the
Secretarial Audit of material unlisted Indian subsidiary is not
applicable to the Company for FY 2024-25.

Risk Management

The Risk Management Committee of the Board has been
entrusted with the responsibility to assist the Board in (a)
Overseeing and approving the Company''s enterprise wide

risk management framework; and (b) Overseeing that all the
risks that the organisation faces such as strategic, financial,
operational, sectoral, credit, market, liquidity, security,
property, information technology, sustainability, cyber
security, legal, regulatory, reputational and other risks have
been identified and assessed and in the opinion of the Board
there is an adequate risk management infrastructure in place
capable of addressing and mitigating those risks.

The Company has laid down a Risk Management Policy
and the same is available on the website of the Company at
https://www.escortskubota.com/investors/governance.

The details of constitution of Risk Management Committee of
the Company is provided in Report on Corporate Governance
at Annexure D of this Report.

Internal Financial Control and its Adequacy

The Board has adopted policies and procedures for ensuring
the orderly and efficient conduct of its business, including
adherence to Company''s policies, the safeguarding of its
assets, the prevention and detection of fraud, error reporting
mechanisms, the accuracy and completeness of the
accounting records, and the timely preparation of reliable
financial disclosures.

The Company has in place adequate internal financial
controls including with reference to financial statement and
for ensuring the orderly & efficient conduct of its business.

During the year, such controls were tested and no reportable
material weakness in the design or operation was observed.

Disclosures
Meetings of the Board

Six meetings of the Board of Directors were held during the
year. For further details, please refer Report on Corporate
Governance enclosed as Annexure D to this Report.

Audit Committee

For constitution and other details of the Audit Committee,
please refer Report on Corporate Governance enclosed as
Annexure D to this Report.

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

CSR Committee

For constitution and other details of the CSR Committee,
please refer Report on Corporate Governance enclosed as
Annexure D to this Report.

Annual Return

The Annual Return for FY 2024-25* is available on the
weblink at https://static.escortskubota.com/images/other-
documents/2025/EKL 2025 03 31 Form MGT 7.pdf

*Ensuing AGM related information i.e. attendance etc. will be
updated after AGM.

Vigil Mechanism

The Company has adopted a Whistle Blower Policy
establishing vigil mechanism for Directors and Employees
to report their concerns about unethical behaviour, actual
or suspected fraud or violation of the Company''s Code of
Conduct. The mechanism provides for adequate safeguards
against victimisation of effected Director(s) and Employee(s).
In exceptional cases, Directors and Employees have direct
access to the Chairman of the Audit Committee. It is affirmed
that no personnel of the Company has been denied access
to the Audit Committee.

The Whistle Blower Policy is available on Company''s website
at https://www.escortskubota.com/investors/governance.

The Board has also adopted the Anti-Bribery Policy and the
same is available on Company''s website at https://www.
escortskubota.com/investors/governance.

Registrar and Share Transfer Agent

The share transfer and related activities are being carried
out by M/s. KFin Technologies Limited, Registrar and Share
Transfer Agent from the following address:

M/s. KFin Technologies Limited
Selenium Building, Tower B, Plot No. 31-32,

Financial District, Nanakramguda, Serilingampally,
Hyderabad, Rangareddy, Telangana - 500032

Particulars of Loans given, Investments made,
Guarantees given and Securities provided

A statement regarding Loans/ Guarantees given and
Investments made and Securities provided covered under the
provisions of the Section 186 of the Act is made in the notes
to the financial statements.

Particulars of Employees and related disclosures

In terms of provisions of Section 197(12) of the Act, read
with the Companies (Appointment and Remuneration of
Managerial Personnel) Rules, 2014, a statement showing
the names and other particulars of the employees drawing
remuneration in excess of the prescribed limits are available
with the Company Secretary.

In terms of the first proviso to Section 136(1) of the Act, the
Annual Report excluding the aforesaid information is being
sent to the members of the Company. Any member interested
in obtaining such particulars may write to the Company
Secretary of the Company and the same will be furnished on
request.

Disclosures pertaining to remuneration and other details as
required under Section 197(12) of the Act read with Rule
5(1) of the Companies (Appointment and Remuneration
of Managerial Personnel) Rules, 2014 is enclosed as
Annexure H and forms an integral part of this Report.

Public Deposits

The Company has not accepted/ renewed any deposit (as
covered under Chapter V of the Act) during the financial year
under review and as such no amount of principal or interest
was outstanding as of the Balance Sheet date.

Investor Education and Protection Fund (''IEPF'')

Pursuant to the applicable provisions of the Act, read with
IEPF Authority (Accounting, Audit, Transfer and Refund)
Rules, 2016 (‘the Rules''), all unpaid or unclaimed dividends
are required to be transferred by the Company to the IEPF
established by the Central Government, after the completion
of seven years. Accordingly, the Company has transferred
'' 20.58 lakhs, pertaining to unclaimed dividend, during the
period under review, to IEPF.

Further, according to the rules, the shares in respect of which
dividend has not been paid or claimed by the shareholders for
seven consecutive years or more shall also be transferred to
the demat account created by the IEPF Authority. Accordingly,
the Company has transferred 40,463 shares, during the
period under review, to IEPF. The detailed information is
available at our website https://www.escortskubota.com/
investors/policies-and-documents.

As on March 31, 2025, no unclaimed deposits are pending
which required to be transferred to IEPF.

Credit Rating

The present credit rating of the Company is as under:

CRISIL Limited granted long term rating as “AA with stable
outlook” and Short-Term rating as “A1 ”

During the financial year 2024-25, there has been no change
in the credit rating.

Material Changes and Commitment affecting the
financial position

There are no material changes affecting the financial position
of the Company subsequent to the closure of the FY 2024-25
till the date of this report.

Change in the Nature of Business

There has been no change in the nature of business of
the Company, except as detailed out under the para of
Divestment in this report.

Prevention of Sexual Harassment

The Company has zero tolerance for sexual harassment at
workplace and has adopted a policy on Prevention, Prohibition
and Redressal of Sexual Harassment at Workplace in line
with the provisions of the Sexual Harassment of Women
at Workplace (Prevention, Prohibition and Redressal) Act,
2013 and the rules thereunder for prevention and redressal
of complaints of sexual harassment at workplace. The
Company is committed to provide equal opportunities without
regard to their race, caste, sex, religion, colour, nationality,
disability, etc. All women associates (permanent, temporary,
contractual and trainees) as well as any women visiting the
Company''s office premises or women service providers are
covered under this Policy. All employees are treated with
dignity with a view to maintain a work environment free of
sexual harassment whether physical, verbal or psychological.

The Company has also 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.

One case was filed and resolved during the year under review
pursuant to the Sexual Harassment of Women at Workplace
(Prevention, Prohibition and Redressal) Act, 2013.

Human Resources Management

Our employees are our most important assets. We are
committed to hiring and retaining the best talent being
among the industry''s leading employers. For this, we focus
on promoting a collaborative, transparent and participative
organisation culture, and rewarding merit and sustain high
performance. Our human resources management focuses on
allowing our employees to develop their skills, grow in their
career.

Secretarial Standards

The Company is in compliance with all the applicable
Secretarial Standards issued by the Institute of Company
Secretaries of India.

Integrated Report

The Company has provided Integrated Report, which
includes non-financial and financial information to have a
better understanding of the Company’s long-term strategy.

This report also touches upon aspects such as organisations
strategy, governance framework, performance and prospects
of value creation based on six forms of capital viz. financial
capital, manufactured capital, intellectual capital, human
capital, social and relationship capital and natural capital as
per International framework.

Business Responsibility and Sustainability Report
(''BRSR'')

In November 2018, the Ministry of Corporate Affairs (''MCA'')
constituted a Committee on Business Responsibility
Reporting (''the Committee'') to finalise business responsibility
reporting formats for listed and unlisted companies, based
on the framework of the National Guidelines on Responsible
Business Conduct (''NGRBC''). Through its report, the
Committee recommended that BRR be rechristened BRSR,
where disclosures are based on ESG Corporate Overview,
Management Discussion and Analysis, Financial Statements
parameters, compelling organisations to holistically engage
with stakeholders and go beyond regulatory compliances in
terms of business measures and their reporting. Pursuant
to Regulation 34 of SEBI Listing Regulations, the BRSR is
mandatory for the top 1,000 listed companies (by market
capitalisation). The BRSR disclosures are enclosed as
Annexure I and forms an integral part of this report.

Application made or any proceeding pending under the
Insolvency and Bankruptcy Code

As on the date of the Report no application is pending
under the Insolvency and Bankruptcy Code, 2016 and the
Company did not file any application under (''IBC'') during the
FY 2024-25.

Further, the Company has not made any one-time settlement.
Compliance by Large Corporate

Your Company does not fall under the category of large
corporate, as defined by SEBI vide its circular no. SEBI/
HO/DDHS/P/CIR/2021/613 dated August 10, 2021 read
with updated circular dated April 13, 2022 and Circular No.
SEBI/HO/DDHS/DDHS-RACPOD1/P/CIR/2023/172 dated
October 19, 2023, as such no disclosure is required in this
regard.

Disclosure of Certain Type of Agreements Binding
Listed Entity

Pursuant to Regulation 30A(2) of SEBI Listing Regulations,
there is no agreement impacting the management or control
of the Company or imposing any restrictions or create any
liability upon the Company except as already disclosed in the
Annual Report of financial year 2023-24.

Directors’ Responsibility Statement

Pursuant to the requirement under Section 134(5) of the Act,
with respect to Directors'' Responsibility Statement, your
Directors, to the best of their knowledge and ability, hereby
confirm that:

(i) i n the preparation of the annual accounts for the year
ended March 31, 2025, the applicable accounting
standards read with requirements set out under
Schedule III to the Act, have been followed along with
proper explanation relating to material departures;

(ii) the Directors have selected such accounting policies
and applied them consistently and made judgements
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 March 31,2025 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 the 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 March 31, 2025 on a ‘going
concern'' basis;

(v) the Directors have laid down internal financial controls
to be followed by the Company and such internal
financial controls are adequate and are operating
effectively; and

(vi) the Directors had devised proper systems to ensure
compliance with the provisions of all applicable laws and
such systems are adequate and operating effectively.

General

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

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

2. Issue of shares (including sweat equity shares) to
employees of the Company under any scheme save and
except ESOS referred to in this Report.

3. Neither the Managing Director nor the Whole-time
Directors of the Company receive any remuneration
or commission from any of its subsidiaries/ holding
company except Mr. Seiji Fukuoka, Whole-time Director
designated as Deputy Managing Director, who is taking
a remuneration from holding company of the Company.

4. No significant or material orders were passed by the
Regulators or Courts or Tribunals which impact the
going concern status and Company''s operations in
future. However, members attention is drawn to note
32 in the notes to accounts in the standalone financial
statement and to note 34 in the notes to accounts in
the consolidated financial statement which sets out
information on Commitments and Contingencies.

5. Details of difference between amount of valuation done
at the time of one-time settlement and the valuation done
while taking loan from the Banks or Financial Institutions
along with the reasons thereof.

6. No political contribution made during the year under
review.

Acknowledgement

Your Directors would like to express their sincere appreciation
of the positive co-operation received from the Central
Government, the Government of Haryana, Maharashtra,
Tamil Nadu and Karnataka, Financial Institutions and the
Company''s Bankers, Customers, Dealers and all other
business associates.

The Directors also wish to place on record their deep sense of
appreciation for the commitment displayed by all executives,
officers, workers, employee unions and staff of the Company
resulting in the successful performance of the Company
during the FY.

The Board also takes this opportunity to express its deep
gratitude for the continued co-operation and support received
from its valued shareholders.

For and on behalf of the Board of Directors
Sd/- Sd/-

Place: Faridabad Nikhil Nanda Seiji Fukuoka

Date: May 08, 2025 Chairman and Managing Director Deputy Managing Director

---

Mar 31, 2024

The Directors have pleasure in presenting this Integrated Annual Report (‘Annual Report'') of the Escorts Kubota Limited (“Escorts” or “Company”) along with the Company''s audited financial statements (standalone and consolidated) for the financial year ended on March 31,2024.

Financial Results				(Rs. Crores)
Particulars	Standalone		Consolidated
	Year ended on March 31, 2024	Year ended on March 31,2023	Year ended on March 31,2024	Year ended on March 31,2023
Revenue from operations	8,776.74	8,344.95	8,849.62	8,428.69
Other income	398.30	280.56	398.59	280.93
Total income	9,175.04	8,625.51	9,248.21	8,709.62
Profit from operations before Interest, Depreciation, Exceptional Items & Tax	1,567.08	1,060.98	1,581.64	1,050.97
Finance Cost	10.84	10.26	13.72	13.27
Profit from operations before Depreciation, Exceptional Items & Tax	1,556.24	1,050.72	1,567.92	1,037.70
Depreciation & Amortization	166.44	148.43	166.90	150.06
Profit from operations before Tax and Exceptional items	1,389.80	902.29	1,401.02	887.64
Exceptional Items	-	97.16	-	53.05
Profit Before Tax	1,389.80	805.13	1,401.02	834.59
Tax Expense	352.65	198.15	351.94	197.94
Net Profit for the period	1037.15	606.98	1,049.08	636.65

Financial Performance/ State of Company Affairs

The brief highlights of the Company''s performance (Standalone) for the financial year (‘FY'') ended March 31,2024 are:

'' 9,175.04 crores

Total income of the Company for FY 2023-24 stood at '' 9,175.04 crores ('' 8,625.51 crores in FY 2022-23)

'' 1,567.08 crores

Profit from operations before Interest, Depreciation, Exceptional Items & Tax stood at '' 1,567.08 crores.

'' 1,389.80 crores

Profit from operations before Tax (PBT) stood at '' 1,389.80 crores. Net profit for the period stood at '' 1,037.15 crores.

Our Company sold 95,858 tractors during the year under review as against 1,03,290 tractors sold during the last financial year.

The brief highlights of the Company''s performance (Consolidated) for the financial year ended March 31, 2024 are:

• Total income of the Company for FY 2023-24 stood at '' 9,248.21 crores ('' 8,709.62 crores in FY 2022-23)

• Profit from operations before Interest, Depreciation, Exceptional Items & Tax stood at '' 1,581.64 crores

• Profit from operations before Tax (PBT) stood at '' 1,401.02 crores. Net profit for the period stood at '' 1,049.08 crores

The details on the individual businesses of the Company are provided in the Management Discussion & Analysis section provided in this Annual Report.

Management Discussion & Analysis

In terms of the provisions of Regulation 34 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred as the “SEBI Listing Regulations”), the Management Discussion and Analysis is set out in this Annual Report and provides a detailed analysis on the performance of individual businesses and their outlook.

Dividend

Based on the Company''s performance, your Directors are pleased to recommend, for approval of the members, Dividend @180% per share of face value of '' 10/- each (i.e. '' 18.00 per share) for the financial year ended March 31, 2024, payable on all outstanding shares.

The dividend payout is subject to the approval of members at the ensuing Annual General Meeting (“AGM”).

The dividend payout for the period under review has been formulated in accordance with shareholders'' aspirations and the Company''s Dividend Distribution Policy to pay sustainable dividend linked to long-term growth objectives of the Company to be met by internal cash accruals.

The record date for the purpose of dividend will be July 05, 2024.

The dividend distribution policy is available on the following web link https://www.escortskubota.com/images/pdf/ Dividend-Distribution-Policy.pdf.

Transfer to Reserves

During the year ended March 31,2024, no amount (previous year: nil) transferred to general reserves.

Employee Stock Option Scheme (ESOS)

The Escorts Employees Stock Option Scheme (“Scheme”) is in line with the SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 (“SBEB Regulations”) and there were no change to the scheme during FY 2023-24.

The Scheme is being implemented in accordance with the SBEB Regulations and the resolution(s) passed by the members. The Secretarial Auditors Certificate would be

available during the Annual General Meeting for inspection by the members. The details as required to be disclosed under the Companies Act, 2013 (hereinafter referred as “the Act”) and/ or SBEB Regulations would be available on the Company’s website at www.escortskubota.com/other-documents.html.

Further, the Board at its meeting held on March 14, 2024 has approved the acceleration of unvested options and accordingly 1,16,640 unvested options has been vested with the eligible employees as on March 31, 2024 on pro rata basis and 80,549 unvested options has been cancelled. The other details pertaining to the above are provided in note 38 of the Notes to Accounts of Standalone Financial Statement of the Company.

Change in Share Capital

During the FY 2023-24, the Company extinguished/ cancelled 2,14,42,343 Equity Shares of nominal value '' 10/- each held by Escorts Benefits and Welfare Trust (EBWT) without payment of any consideration, pursuant to the ‘Scheme of Reduction of Share Capital’ (“Second Capital Reduction”), approved by National Company Law Tribunal (NCLT), Chandigarh Bench vide its order dated May 25, 2023. Consequently, the paid-up equity share capital of the Company, after said Second Capital Reduction stood at '' 110,49,82,610 consisting of 11,04,98,261 equity shares of '' 10/- each.

Merger & Amalgamation

In accordance with the directions of the National Company Law Tribunal (NCLT), Chandigarh Bench given vide its order dated October 16, 2023 on first motion petition submitted by Company, the scheme of amalgamation (“Scheme”) among and between Escorts Kubota India Private Limited, Kubota Agricultural Machinery India Private Limited and the Company, under Sections 230 to 232 and other applicable provisions of the Companies Act, 2013 and the rules framed thereunder, has been approved by NCLT convened shareholders and creditors meetings of the Company held on December 02, 2023. Subsequently, second motion petition was filed on December 11,2023 before the NCLT. However, the final order of the NCLT is awaited.

Utilization of Funds The reporting of the utilization of funds, as on March 31,2024, raised through the above preferential allotment are as follows:
Original Object	Modified Object, if any	Original Allocation	Modified allocation, if any	Funds Utilized	Amount of Deviation/ Variation for the year according to applicable object	Remarks if any
For the Agri Machinery Business of the Company i.e. the business of manufacturing, assembly, sales, marketing, financing, servicing, research and development of: (a) tractors; (b) construction equipment (i.e., backhoe loaders and other items to be mutually agreed between Promoters and Kubota Corporation); (c) implements; (d) transmission for tractors, construction equipment (i.e., backhoe loaders and other items to be mutually agreed between the Promoters and Kubota Corporation) and implements; and (e) spare parts of the items referred in (a), (b), (c) and (d), and for the manufacture of engines by the Company	Not Applicable	'' 1,041.90 crores	Nil	'' 631.36 crores (Including '' 133.98 crores utilized during the year)	Nil
For expansion of its agri-machinery business of manufacturing, assembly, sales, marketing, financing, servicing, research and development of: (a) tractors; (b) combine harvester & rice transplanter; (c) utility vehicles; (d) turf equipment; (e) construction machinery; (f) engines; (g) implements; (h) transmission for tractors, construction equipment and implements; (i) other farm mechanization equipment; (j) spare parts of the items referred in (a) to (i) above	Not Applicable	'' 1,855.31 crores*	Nil	Nil	Nil
*Net proceeds post deduction of expenditure of '' 17.44 crores incurred towards preferential issue and allotment.

Directors and Key Managerial Personnel

In accordance with the provisions of the Companies Act, 2013 (hereinafter referred as “the Act”) and Articles of Association of the Company, Mr. Hardeep Singh (DIN: 00088096), Mr. Dai Watanabe (DIN: 08736520) and Mr. Yasukazu Kamada (DIN: 09634701), Directors of the Company, retire by rotation at the ensuing Annual General Meeting (“AGM”) and being eligible, offer themselves for re-appointment. The shareholders at AGM held on July 14, 2023, had appointed Dr. Rupinder

Singh Sodhi (DIN: 03179002) as an Independent Director in place of Mr. Sutanu Behuria (DIN: 00051668), whose tenure had been completed at the last AGM.

Further, the tenure of Mr. Sunil Kant Munjal (DIN: 00003902), Independent Director is expiring in the ensuing AGM i.e. completing his first term. The Board of Directors, on recommendation of Nomination, Remuneration and Compensation Committee (“NRC”), in their meeting held on May 09, 2024 had recommended the re-appointment of

Mr. Munjal as an Independent Director for second term for 5 years for approval of members of the Company at the ensuing AGM.

Further, the tenure of Ms. Tanya Arvind Dubash (DIN: 00026028), Independent Director is expiring on January 28, 2025. Ms. Dubash was appointed as an Independent Director for a period of 5 years w.e.f. January 29, 2020 and completing the first term which will be ending on January 28, 2025. The Board of Directors, on recommendation of NRC, in their meeting held on May 09, 2024 had recommended the re-appointment of Ms. Tanya Arvind Dubash as an Independent Director for second term of 5 years effective from January 29, 2025 for approval of members of the Company at the ensuing AGM.

Further, the tenure of Ms. Nitasha Nanda (DIN: 00032660), Whole-time Director of the Company is expiring on January 15, 2025. The Board of Directors, on recommendation of NRC, in their meeting held on May 09, 2024 had recommended the re-appointment of Ms. Nitasha Nanda as a Whole-time Director of the Company, liable to retire by rotation, for a period of 3 years effective from January 16, 2025 for approval of members of the Company at the ensuing AGM.

Further, Mr. Yuji Tomiyama (DIN: 08779472) and Mr. Shiro Watanabe (DIN: 09588547), Non - Executive Nominee Directors had resigned, due to their pre-occupation in other professional assignments, from the Board on February 08, 2024 , and in their place, the Board, on the recommendation of NRC, have appointed Mr. Nobushige Ichikawa (DIN: 09570234) and Mr. Shingo Hanada (DIN: 10484929) as an additional Non - Executive Nominee Directors, effective from February 08, 2024, liable to retire by rotation. Subsequently, the shareholders of the Company have approved the appointment of said directors, vide postal ballot notice dated February 08, 2024 on March 21,2024.

Mr. Satyendra Chauhan, Company Secretary and Compliance Officer of the Company has resigned w.e.f. February 29, 2024 and in his place Mr. Arvind Kumar has been appointed as a Company Secretary and Key Managerial Personnel of the Company and Mr. Vicky Chauhan has been appointed as the Compliance Officer of the Company.

The Company has received declarations from all Independent Directors of the Company that they meet the criteria of independence as prescribed under sub-section (6) of Section 149 of the Act and under Regulations 16 and 25 of SEBI Listing Regulations and there has been no change in the circumstances affecting their status as independent

directors of the Company. The Company has also received a declaration from all the independent directors that they have registered their names in the independent director data bank and pass/ exempt requisite proficiency test conducted by Ministry of Corporate Affairs.

In the opinion of the Board, the Independent Directors of the Company are the persons of integrity, expertise and fulfill the conditions as per the applicable laws and are independent of the management of the Company.

The Board at its meetings held on May 10, 2023 and March 14, 2024 has reviewed and made requisite amendment(s) in the Policy on Appointment and Removal of Director''s and Members of Senior Management. Further, the Board at its meeting held on May 10, 2023 has reviewed and made requisite amendment(s) in the Remuneration Policy for Directors, Key Managerial Personnel, Senior Management and other Employees. The Policy on Appointment and Removal of Director''s and Members of Senior Management and Remuneration Policy for Directors, Key Managerial Personnel, Senior Management and other Employees are annexed as Annexure - A and Annexure - B respectively and forms an integral part of this Report.

Annual performance evaluation of the Board, its committees and individual directors (including independent directors) pursuant to the provisions of the Act and the Corporate Governance requirements under SEBI Listing Regulations have been carried out. In accordance with the Policy, and the process, given in Corporate Governance Report, was followed by the Board for evaluation of its own performance and its committees and individual directors including independent directors.

The Board of Directors in their meeting held on May 09, 2024, has recommended, to the Shareholder for their approval in ensuing AGM, the payment of commission to the nonexecutive directors (including independent directors) up to 1% of net profits of the Company for a period of 5 years.

The Company has devised a process whereby various presentations/ programs are being conducted to familiarize the directors with various developments at Industry level, new business initiatives and organization strategies, policy on Business Responsibility & Sustainability Principles etc. The details of program for familiarization of independent directors with the Company, their roles, rights, responsibilities in the Company, nature of industry in which the Company operates, business model of the Company and related matters are put up on the website of the Company - www.escortskubota. com/investors/overview.html.

The Company recognizes and embraces the importance of a diverse board in its success. Your Company believes that a truly diverse board will leverage differences in thought, perspective, knowledge, skill, regional and industry experience, cultural and geographical background, age, ethnicity, race and gender, which will help to retain it''s competitive advantage.

The brief resumes, justification where ever is applicable, and other details relating to the directors who are proposed to be appointed/ re-appointed, as required to be disclosed as per the provisions of the SEBI Listing Regulations/ Secretarial Standard are given in the Annexure I to the Notice of the 78th AGM.

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

The particulars relating to conservation of energy, technology absorption, foreign exchange earnings and outgo, as required to be disclosed under Section 134(3)(m) of the Act read with Companies (Accounts) Rules, 2014 are provided as Annexure - C and forms an integral part of this Report.

Corporate Governance

Corporate Governance is about maximizing shareholders value, ethically and sustainably. At Escorts Kubota the goal of corporate governance is to ensure fairness for every stakeholder. Your Company believes that strong corporate governance is critical to enhancing and retaining investor trust. Your Company also endeavors to enhance long term shareholder value and respect minority rights in all its business decisions.

Your Company reaffirms its commitment to the good corporate governance practices and has adopted the Code of Conduct which has set out the systems, processes and policies conforming to international standards. Pursuant to Regulation 34(3) of the SEBI Listing Regulations, Corporate Governance Report and a Certificate regarding compliance of conditions of Corporate Governance from Company Secretary in Practice are enclosed as Annexure - D and forms an integral part of this Report. Further, other governance related disclosures are available on the website of the Company at www.escortskubota.com/ investors/overview.html.

Corporate Social Responsibility (CSR)

The key philosophy of all CSR initiatives of the Company is to make CSR a key business process for sustainable development of the society. The initiatives aim at enhancing welfare measures of the society based on the immediate

and long term social and environmental consequence of its activities. The Company intends to undertake other need-based initiatives in compliance with Schedule VII of the Act.

The CSR Policy may be accessed on the Company''s website at www.escortskubota.com/investors/governance.html. During the year, the Company has spent '' 17.72 crores. (Refer note 29 of the standalone financial statement).

For constitution and other details of the CSR Committee, please refer Report on Corporate Governance annexed as Annexure - D to this Report.

The Annual Report on CSR activities is enclosed as Annexure - E and forms an integral part of this Report.

Consolidated Financial Statement

The Consolidated Financial Statement have been prepared in accordance with the Act and Indian Accounting Standard (“IND AS”) - 110 applicable to the Consolidated Financial Statement read with IND AS-28 on Accounting for Investments in Associates and IND AS-31 on Financial Reporting of Interests in Joint Ventures issued by The Institute of Chartered Accountants of India. The Audited Consolidated Financial Statement along with the Auditors'' Report thereon are annexed with this Report.

Subsidiaries, Joint Ventures and Associate Companies

In accordance with Section 129(3) of the Companies Act, 2013, a statement containing salient features of the financial statements of the subsidiary(ies) and associate(s) companies in Form AOC-1 is provided in this Report. The statement also provides details of performance and financial position of each of the subsidiaries and associates. Audited financial statements together with related information and other reports of each of the subsidiary companies have also been placed on the website of the Company at www.escortskubota.com/ investors/annual-reports.html. The Consolidated Financial Statement presented by the Company include the financial results of its subsidiary and associate companies.

In terms of the Company’s Policy on determining “material subsidiary”, during the financial year ended March 31,2024, there is no material subsidiary of the Company whose income or net worth exceeds 10% of the consolidated income or net worth of the Company in the immediately preceding Financial Year.

Further, during the FY ended on March 31, 2024, the Company has incorporated Escorts Kubota Finance Limited, as a wholly owned subsidiary company on January 09, 2024 to do the captive finance business, subject to the receipt of registration certificate from Reserve Bank of India and other necessary approvals.

The complete list of subsidiaries, joint ventures and associate companies as on March 31,2024, in terms of the Act and IND-AS is provided herein below:
S. No.	Name of the subsidiary / associate companies / joint ventures	Relationship	% of shares
1.	Escorts Crop Solutions Limited	Subsidiary	100%
2.	EKL CSR Foundation (Formerly Escorts Skill Development)	Subsidiary	100%
3.	Escorts Kubota Finance Limited	Subsidiary	100%
4.	Invigorated Business Consulting Limited (Formerly Escorts Finance Limited)	Subsidiary	67.87%
5.	Farmtrac Tractors Europe Spolka Z.o.o.	Subsidiary	100%
6.	Escorts Benefit and Welfare Trust	Subsidiary	100%
7.	Escorts Benefit Trust	Subsidiary	100%
8.	Adico Escorts Agri Equipments Private Limited	Joint Venture	40%
9.	Escorts Kubota India Private Limited	Joint Venture	40%
10.	Kubota Agricultural Machinery India Private Limited	Joint Venture	40%
11.	Escorts Consumer Credit Limited	Associate	29.41%

The details of the above investments/ disinvestment are provided in note 7 of the Notes to Accounts of Standalone Financial Statements of the Company.

Downstream Investment

The Company has made a downstream investment of '' 20 crores in Escorts Kubota Finance Limited, wholly owned subsidiary company of the Company, in compliance with the applicable provisions of the laws, rules and regulations. Further, the requisite filing/ intimation and auditor''s certificate in this regard yet to be filed/ obtained.

Contracts and Arrangements with Related Parties

All contracts/ arrangements/ transactions entered 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 of the Company on the materiality of related party transactions.

The particulars of contracts or arrangements, with related parties referred to in Section 188(1) of the Act, in the prescribed Form AOC-2, is appended as Annexure - F to this report.

The Policy on Materiality of Related Party Transactions and Dealing with Related Party Transactions may be accessed on the Company''s website at www.escortskubota.com/ investors/governance.html.

Your Directors draw attention of the members to note 45 in the notes to accounts in the standalone financial statement and to note 44 in the notes to accounts in the consolidated financial statement which sets out related party disclosures.

Auditors and Auditors’ Report Statutory Auditors

Pursuant to the provisions of Section 139 of the Act read with rules thereunder, the shareholders of the Company at the 76th AGM held on July 14, 2022 had re-appointed M/s. Walker Chandiok & Co LLP, Chartered Accountants, New Delhi (Firm Registration No. 001076N/ N500013) as Statutory Auditors of the Company for a period of 5 years i.e. upto the conclusion of AGM to be held in the year 2027.

The comments given by M/s. Walker Chandiok & Co LLP, Chartered Accountants, Statutory Auditors, in their report read together with notes to Accounts for the FY ended March 31, 2024 are self-explanatory and hence, do not call for any further explanations or comments under Section 134 of the Act.

Pursuant to provisions of the Section 143(12) of the Companies Act, 2013 neither the Statutory Auditors nor Secretarial Auditors nor Cost Auditors have reported any incident of fraud to the Audit Committee or the Board during the year under review.

Cost Auditors

Pursuant to the Section 148 of the Act read with rule thereunder, your Company is required to maintain the Cost records and the said cost records are required to be audited.

The Company is maintaining all the aforesaid Cost records.

The Board of Directors, on the recommendation of Audit Committee, has re-appointed M/s. Ramanath Iyer and Co., Cost Accountants (Firm Registration No. 000019), as Cost Auditors of the Company for conducting the audit of cost records for the FY 2024-25.

The due date of filing the Cost Audit Report for the year ended on March 31,2023 was September 30, 2023 and the same had been filed on August 29, 2023.

Secretarial Auditors

The Board had appointed M/s. Jayant Gupta and Associates, Practicing Company Secretaries, as Secretarial Auditors to conduct secretarial audit of the Company for the FY 2023-24.

The Secretarial Audit Report of the Company as prescribed under Section 204 of the Act is annexed herewith as Annexure - G and forms an integral part of this Report.

The Secretarial Audit Report does not contain any qualification, reservation and adverse remarks and the comments given by the Secretarial Auditors in their report are self-explanatory and hence, do not call for any further explanations or comments under Section 204(3) of the Act.

The Board has also re-appointed M/s. Jayant Gupta and Associates, Practicing Company Secretaries to conduct secretarial audit of the Company for the FY 2024-25.

Risk Management

The Risk Management Committee of the Board has been entrusted with the responsibility to assist the Board in (a) Overseeing and approving the Company''s enterprise wide risk management framework; and (b) Overseeing that all the risks that the organization faces such as strategic, financial, credit, market, liquidity, security, property, IT, sustainability, cyber security, legal, regulatory, reputational and other risks have been identified and assessed and there is an adequate risk management infrastructure in place capable of addressing those risks.

The Company has laid down a Risk Management Policy and the same is available on the website of the Company at www.escortskubota.com/investors/governance.html.

The details of constitution of Risk Management Committee of the Company is provided in Report on Corporate Governance at Annexure - D of the Directors'' Report.

Internal Financial Control and its Adequacy

The Board has adopted policies and procedures for ensuring the orderly and efficient conduct of its business, including adherence to Company''s policies, the safeguarding of its assets, the prevention and detection of fraud, error reporting mechanisms, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial disclosures.

The Company has in place adequate internal financial controls including with reference to financial statement and for ensuring the orderly & efficient conduct of its business.

During the year, such controls were tested and no reportable material weakness in the design or operation was observed.

Disclosures Meetings of the Board

Seven meetings of the Board of Directors were held during the year. For further details, please refer Report on Corporate Governance annexed as Annexure - D to this Report.

Audit Committee

For constitution and other details of the Audit Committee, please refer Report on Corporate Governance annexed as Annexure - D to this Report.

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

CSR Committee

For constitution and other details of the CSR Committee, please refer Report on Corporate Governance annexed as Annexure - D to this Report.

Annual Return

The Annual Return for FY 2023-24* is available on the Company''s website at www.escortskubota.com/other-documents.

*Ensuing AGM related information i.e. attendance etc. to be updated after AGM.

Vigil Mechanism

The Company has adopted a Whistle Blower Policy establishing vigil mechanism for Directors and Employees to report their concerns about unethical behavior, actual or suspected fraud or violation of the Company''s Code of Conduct. The mechanism provides for adequate safeguards against victimization of effected Director(s) and Employee(s). In exceptional cases, Directors and Employees have direct access to the Chairman of the Audit Committee. It is affirmed that no personnel of the Company has been denied access to the Audit Committee.

The Whistle Blower Policy has been reviewed and noted by the Board during the year at its meeting held on February 08, 2024 and is available on Company''s website at www.escortskubota.com/investors/governance.html.

The Board has also adopted the Anti-Bribery Policy and the same is available on Company''s website at www.escortskubota.com/investors/governance.html.

Registrar and Share Transfer Agent

The share transfer and related activities are being carried out by M/s. KFin Technologies Limited (earlier KFin Technologies Private Limited), Registrar and Share Transfer Agent from the following address:

M/s. KFin Technologies Limited Selenium Building, Tower B, Plot No. 31-32,

Financial District, Nanakramguda, Serilingampally,

Hyderabad, Rangareddy, Telangana - 500032

Particulars of Loans given, Investments made, Guarantees given and Securities provided

A statement regarding Loans/ Guarantees given and Investments made and Securities provided covered under the provisions of the Section 186 of the Act is made in the notes to the financial statement.

Particulars of Employees and related disclosures

In terms of provisions of Section 197(12) of the Act, read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement showing the names and other particulars of the employees drawing remuneration in excess of the prescribed limits are available with the Company Secretary.

In terms of the first proviso to Section 136(1) of the Act, the Annual Report excluding the aforesaid information is being sent to the members of the Company. Any member interested in obtaining such particulars may write to the Company Secretary of the Company and the same will be furnished on request.

Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed as Annexure - H and forms an integral part of this Report.

Public Deposits

The Company has not accepted/ renewed any Fixed Deposit during the financial year under review and as such no amount of principal or interest was outstanding as of the Balance Sheet date.

Investor Education and Protection Fund (IEPF)

Pursuant to the applicable provisions of the Act, read with IEPF Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 (‘the Rules''), all unpaid or unclaimed dividends are required to be transferred by the Company to the IEPF established by the Central Government, after the completion of seven years. Accordingly, the Company has transferred '' 16.84 Lacs, pertaining to unclaimed dividend, during the period under review, to IEPF.

Further, according to the rules, the shares in respect of which dividend has not been paid or claimed by the shareholders for seven consecutive years or more shall also be transferred to the demat account created by the IEPF Authority. Accordingly, the Company has transferred 47,068 shares, during the period under review, to IEPF. The detailed information is available at our website at www. escortskubota.com/investors/overview.html.

As on March 31, 2024, no unclaimed deposits are pending which required to be transferred to IEPF.

Credit Rating

The present credit rating of the Company is as under:

CRISIL Limited reaffirmed long term rating as “AA with stable outlook” and Short-Term rating as “A1 ”

During the year, the Company had requested ICRA Limited to withdraw the credit rating granted during the year 2023 i.e. long term rating as “AA with stable outlook” and Short-Term rating as “A1 ” and accordingly, the credit rating granted by ICRA was reaffirmed and withdrawn.

Material Changes and Commitment affecting the financial position

There are no material changes affecting the financial position of the Company subsequent to the closure of the FY 2023-24 till the date of this report.

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

Prevention of Sexual Harassment

The Company has zero tolerance for sexual harassment at workplace and has adopted a policy on Prevention, Prohibition and Redressal of Sexual Harassment at Workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the rules thereunder for prevention and redressal of complaints of sexual harassment at workplace. The Company is committed to provide equal opportunities without regard to their race, caste, sex, religion, color, nationality, disability, etc. All women associates (permanent, temporary, contractual and trainees) as well as any women visiting the Company’s office premises or women service providers are covered under this Policy. All employees are treated with dignity with a view to maintain a work environment free of sexual harassment whether physical, verbal or psychological.

The Company has also 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.

Six cases were filed and resolved during the year under review pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

Human Resources Management

Our employees are our most important assets. We are committed to hiring and retaining the best talent being among the industry''s leading employers. We focus on promoting a collaborative, inclusive and transparent organization culture. Our systems and processes focus on allowing the employees to develop their skills to navigate their career path, rewarding and sustaining high performance.

Secretarial Standards

The Company is in compliance with all the applicable Secretarial Standards issued by the Institute of Company Secretaries of India.

Integrated Report

The Company has provided Integrated Report, which includes non-financial and financial information to have a better understanding of the Company’s long-term strategy. This report also touches upon aspects such as organizations strategy, governance framework, performance and prospects of value creation based on six forms of capital viz. financial capital, manufactured capital, intellectual capital, human capital, social and relationship capital and natural capital as per International framework.

Business Responsibility and Sustainability Report (BRSR)

In November 2018, the Ministry of Corporate Affairs (“MCA”) constituted a Committee on Business Responsibility Reporting (“the Committee”) to finalize business responsibility reporting formats for listed and unlisted companies, based on the framework of the National Guidelines on Responsible Business Conduct (“NGRBC”). Through its report, the Committee recommended that BRR be rechristened BRSR, where disclosures are based on ESG Corporate Overview Management Discussion and Analysis Financial Statements parameters, compelling organizations to holistically engage with stakeholders and go beyond regulatory compliances in terms of business measures and their reporting. SEBI, vide its circular dated May 10, 2021, made BRSR mandatory for the top 1,000 listed companies (by market capitalization) from FY 2022-23. Further, pursuant to Regulation 34 of the SEBI Listing Regulations, the BRSR disclosures are enclosed as Annexure I and forms an integral part of this report.

Application made or any proceeding pending under the Insolvency and Bankruptcy Code

As on the date of the Report no application is pending under the Insolvency and Bankruptcy Code, 2016 (“IBC”) and the Company did not file any application under IBC during the FY 2023-24. Further, the Company has not made any one-time settlement.

Compliance by Large Corporate

Your Company does not fall under the category of large corporate, as defined under SEBI vide its circular SEBI/HO/ DDHS/DDHS-RACPOD1/P/CIR/2023/172 dated October 19, 2023, as such no disclosure is required in this regard.

Disclosure of Certain Type of Agreements Binding Listed Entity

Pursuant to Regulation 30A(2) of SEBI Listing Regulations, there is no agreement impacting the management or control of the Company or imposing any restrictions or create any liability upon the Company. However, there is one shareholder’s agreement executed among and between the Company, Kubota Corporation (holding company of the Company), Mr. Nikhil Nanda and other parties. The details of the agreement including the salient features of the same was duly intimated to Stock Exchanges vide our letter dated November 18, 2021 and such intimation is available on the website of the Company at www.escortskubota.com/investors/ overview.html. Further, the detailed terms including rights and obligations etc. of all the parties has been incorporated in the Memorandum and Articles of Association of the Company on page no. 54 and the same is available at the Company’s website at www.escortskubota.com/templates/ escortsgroup home/images/pdf/Charter-Document.pdf.

Directors’ Responsibility Statement

Pursuant to the requirement under Section 134(5) of the Act, with respect to Directors’ Responsibility Statement, your Directors, to the best of their knowledge and ability, hereby confirm that:

(i) i n the preparation of the annual accounts for the year ended March 31, 2024, the applicable accounting standards read with requirements set out under Schedule III to the Act, have been followed along with proper explanation relating to material departures;

(ii) the Directors have selected such accounting policies and applied them consistently and made judgements 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 March 31,2024 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 the 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 March 31, 2024 on a ‘going concern'' basis;

(v) t he Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively; and

(vi) the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

General

Your Directors state that no disclosure or reporting is required

in respect of the following items as there were no transactions

on these items during the year under review:

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

2. Issue of shares (including sweat equity shares) to employees of the Company under any scheme save and except ESOS referred to in this Report.

3. Neither the Managing Director nor the Whole-time Directors of the Company receive any remuneration or commission from any of its subsidiaries.

4. No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Company''s operations in future. However, members attention is drawn to note 32 in the notes to accounts in the standalone financial statement and to note 33 in the notes to accounts in the consolidated financial statement which sets out information on Commitments and Contingencies.

5. Details of difference between amount of valuation done at the time of one-time settlement and the valuation done while taking loan from the Banks or Financial Institutions along with the reasons thereof.

6. No political contribution made during the year under review.

Acknowledgement

Your Directors would like to express their sincere appreciation of the positive co-operation received from the Central Government, the Government of Haryana and Karnataka, Financial Institutions and the Company''s Bankers, Customers, Dealers and all other business associates.

The Directors also wish to place on record their deep sense of appreciation for the commitment displayed by all executives, officers, workers, employee unions and staff of the Company resulting in the successful performance of the Company during the year.

The Board also takes this opportunity to express its deep gratitude for the continued co-operation and support received from its valued shareholders.

---

Mar 31, 2023

Your Directors have pleasure in presenting this Integrated Annual Report (‘Annual Report'') of the Escorts Kubota Limited (Escorts/ Company) along with Company''s audited financial statements (standalone and consolidated) for the financial year ended on March 31, 2023.

Financial Results

('' crores)
	Standalone		Consolidated
Particulars	Year ended on March 31, 2023	Year ended on March 31, 2022	Year ended on March 31, 2023	Year ended on March 31,2022
Revenue from operations	8,344.95	7,196.90	8,428.69	7,282.65
Other income	280.56	168.80	280.93	173.80
Total income	8,625.51	7,365.70	8,709.62	7,456.45
Profit from operations before Interest, Depreciation, Exceptional Items & Tax	1,060.98	1,164.33	1,050.97	1,139.86
Finance Cost	10.26	12.70	13.27	14.97
Profit from operations before Depreciation, Exceptional Items & Tax	1,050.72	1,151.63	1,037.70	1,124.89
Depreciation & Amortisation	148.43	129.75	150.06	132.06
Profit from operations before Tax and exceptional items	902.29	1,021.88	887.64	992.83
Less: Exceptional Items	97.16	-	53.05	-
Profit Before Tax	805.13	1,021.88	834.59	992.83
Tax Expense	198.15	256.27	197.94	257.22
Net Profit for the period	606.98	765.61	636.65	735.61

Financial Performance/ State of Company Affairs

The brief highlights of the Company''s performance (Standalone) for the financial year (‘FY'') ended March 31, 2023 are:

J8,625.51 Crores Total income of the Company for FY 2023 stood at H8,625.51 crores (''7,365.70 crores in FY 2022) J1,060.98 Crores Profit from operations before Interest, Depreciation, Exceptional Items & Tax stood at '' 1,060.98 crores. J805.13 Crores Profit from operations before Tax (PBT) stood at H805.13 crores. Net profit for the period stood at H606.98 crores.

Our Company sold 1,03,290 tractors during the year under review as against 94,228 tractors sold during the last financial year.

The brief highlights of the Company''s performance (Consolidated) for the financial year ended March 31,2023 are:

• Total income of the Company for FY 2023 stood at ''8,709.62 crores (''7,456.45 crores in FY 2022).

• Profit from operations before Interest, Depreciation, Exceptional Items & Tax stood at ''1,050.97 crores.

• Profit from operations before Tax (PBT) stood at ''834.59 crores. Net profit for the period stood at ''636.65 crores.

The details on the individual businesses of the Company are provided in the Management Discussion & Analysis section provided in this Annual Report.

Management Discussion & Analysis

In terms of the provisions of Regulation 34 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred as the “SEBI Listing Regulations"), the Management Discussion and Analysis is set out in this Annual

Report and provides a detailed analysis on the performance of individual businesses and their outlook.

Dividend

Based on the Company''s performance, your Directors are pleased to recommend, for approval of the members, Dividend @70% per share of face value of C10/- each (i.e. C7.00 per share) for the financial year ended March 31, 2023, payable on all outstanding shares except on the equity shares held by ‘Escorts Benefit & Welfare Trust''.

The dividend payout is subject to the approval of members at the ensuing Annual General Meeting (AGM).

The dividend payout for the period under review has been formulated in accordance with shareholders'' aspirations and the Company''s Dividend Distribution Policy to pay sustainable dividend linked to long-term growth objectives of the Company to be met by internal cash accruals.

The record date for the purpose of dividend will be June 30, 2023.

The dividend distribution policy is available on our website at https://www.escortsgroup.com/investors/governance.

Transfer to Reserves

During the FY ended March 31, 2023, no amount (previous year: C0.07 crores on account of vested employees stock options lapsed) transferred to general reserves.

Employee Stock Option Scheme (ESOS)

The Escorts Employees Stock Option Scheme (“Scheme”) is in line with the SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 (“SBEB Regulations”) and there were no material changes to the scheme during the financial year 2022-23.

The Scheme is being implemented in accordance with the SBEB Regulations and the resolution(s) passed by the members. The

Secretarial Auditors Certificate would be available during the Annual General Meeting for inspection by the members. The details as required to be disclosed under the Act and/ or SBEB Regulations would be available on the Company''s website at www.escortsgroup.com.

Change in Share Capital

During the FY 2022-23, there is no change in the share capital of the Company. However, the members of the Company had approved, the ‘scheme of reduction of share capital'' (‘Second Capital Reduction''), vide postal ballot notice dated July 6, 2022 for reduction of 2,14,42,343 Equity Shares of nominal value C10/- each of the Company held by the Escorts Benefits and Welfare Trust (EBWT) without payment of any consideration, and the same has been filed before Hon''ble National Company Law Tribunal (NCLT), Chandigarh Bench, however, the order of the NCLT awaited.

Merger & Amalgamation

Based on recommendations of the Audit Committee and the Committee of Independent Directors, the Board of Directors, in their meeting held on September 15, 2022, has approved the scheme of amalgamation (the “Scheme”) under Sections 230 to 232 and other applicable provisions of the Companies Act, 2013 and the rules framed thereunder. The Scheme, inter-alia, provides for amalgamation of Escorts Kubota India Private Limited, joint venture company of the Company, and Kubota Agricultural Machinery India Private Limited, joint venture company of the Company, with the Company. The same has been filed with BSE Limited and National Stock Exchange of India Limited on September 26, 2022 and September 27, 2022, respectively to get no objection letters as required under Regulation 37 of the SEBI Listing Regulations.

Utilisation of Funds

The reporting of the utilisation of funds, as on March 31,2023, raised through the preferential allotments are as follows:

the appointment of Mr. Seiji Fukuoka as Whole-time Director designated as Deputy Managing Director.

Further, the Board of Director, on recommendation of Nomination Remuneration and Compensation Committee (NRC) has appointed Mr. Bharat Madan as an additional director and Whole-time Director of the Company, designated as Whole-time Director and Chief Financial Officer, effective from February 8, 2023. Subsequently, the shareholders of the Company has approved the such appointment through postal ballot notice dated March 15, 2023.

During the year under review the tenure of second term as Independent Director of Mr. P.H. Ravikumar and Mrs. Vibha Paul Rishi had been completed on July 14, 2022. Further, the tenure of Dr. Sutanu Behuria, Independent Director is expiring in the ensuing AGM. Dr. Behuria was appointed as

Directors and Key Managerial Personnel

In accordance with the provisions of the Companies Act, 2013 (hereinafter referred as “the Act”) and Articles of Association of the Company, Ms. Nitasha Nanda (DIN: 00032660) and Mr. Yuji Tomiyama (DIN: 08779472), Directors of the Company, retire by rotation at the ensuing Annual General Meeting (AGM) and being eligible, offer themselves for re-appointment.

The shareholders at the AGM held on July 14, 2022 had appointed Mr. Vimal Bhandari, Ms. Reema Rameshchandra Nanavaty and Mr. Manish Sharma as Independent Directors and Mr. Yasukazu Kamada as non-executive nominee director and approved the appointment of Mr. Ravindra Chandra Bhargava and Mr. Kenichiro Toyofuku as Independent Directors and Mr. Shiro Watanabe as non-executive nominee director. Further, the shareholders of the Company also approved

an Independent Director in 2015 and completing the second term which will be ending in the ensuing AGM.

Further, Mr. Shailendra Agarwal has resigned from the position of directorship effective from February 3, 2023, due to his health condition.

The Company has received declarations from all Independent Directors of the Company that they meet the criteria of independence as prescribed under sub-section (6) of Section 149 of the Act and under Regulations 16 and 25 of SEBI Listing Regulations and there has been no change in the circumstances affecting their status as Independent Directors of the Company. The Company has also received a declaration from all the Independent Directors that they have registered their names in the Independent Director data bank and pass/ exempt requisite proficiency test conducted by Ministry of Corporate Affairs.

The policy on Appointment and Removal of Director''s and Members of Senior Management was reviewed and amended by the Board at its meeting held on May 10, 2023. The said policy is annexed as Annexure - A and forms an integral part of this Report.

Annual performance evaluation of the Board, its committees and individual directors (including Independent Directors) pursuant to the provisions of the Act and the Corporate Governance requirements under SEBI Listing Regulations have been carried out. In accordance with the Policy, and the process, given in Report on Corporate Governance, was followed by the Board for evaluation of its own performance and its committees and individual directors including Independent Directors.

The remuneration policy for directors, key managerial personnel, senior management and other employees was reviewed and amended by the Board at its meeting held on May 10, 2023. The said policy is annexed as Annexure - B and forms an integral part of this Report.

The Company has devised a process whereby various presentations/ programs are being conducted to familiarise the directors with various developments at Industry level, new business initiatives and organisation strategies etc. The details of programme for familiarisation of Independent Directors with the Company, their roles, rights, responsibilities in the Company, nature of industry in which the Company operates, business model of the Company and related matters are put up on the website of the Company - www.escortsgroup.com.

The Company recognises and embraces the importance of a diverse board in its success. Your Company believes that a truly diverse board will leverage differences in thought, perspective, knowledge, skill, regional and industry experience,

cultural and geographical background, age, ethnicity, race and gender, which will help it retain its competitive advantage.

The brief resumes and other details relating to the directors who are proposed to be appointed/ re-appointed, as required to be disclosed as per the provisions of the SEBI Listing Regulations/ Secretarial Standard are given in the Annexure to the Notice of the 77th AGM.

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

The particulars relating to conservation of energy, technology absorption, foreign exchange earnings and outgo, as required to be disclosed under Section 134(3)(m) of the Act read with Companies (Accounts) Rules, 2014 are provided as Annexure - C and forms an integral part of this Report.

Corporate Governance

Corporate Governance is about maximising shareholders value, ethically and sustainably. At Escorts Kubota the goal of corporate governance is to ensure fairness for every stakeholder. Your Company believes that strong corporate governance is critical to enhancing and retaining investor trust. Your Company also endeavours to enhance long term shareholder value and respect minority rights in all its business decisions.

Your Company reaffirms its commitment to the good corporate governance practices and has adopted the Code of Business Conduct which has set out the systems, processes and policies conforming to international standards. Pursuant to Regulation 34(3) of the SEBI Listing Regulations, Corporate Governance Report and a Certificate regarding compliance of conditions of Corporate Governance from Company Secretary in Practice are enclosed as Annexure - D and forms an integral part of this Report.

Corporate Social Responsibility (CSR)

The key philosophy of all CSR initiatives of the Company is to make CSR a key business process for sustainable development of the society. The initiatives aim at enhancing welfare measures of the society based on the immediate and long term social and environmental consequence of its activities. The Company intends to undertake other need-based initiatives in compliance with Schedule VII of the Act.

The CSR Policy and Impact Assessment Report may be accessed on the Company''s website www.escortsgroup. com under Investors Information Section. During the year, the Company has spent H17.30 crores. {Including amount transferred to unspent CSR account (refer note 29 of the standalone financial statements)}.

S. No.	Name of the subsidiary / associate companies / joint ventures	Relationship	% of shares
1.	Escorts Crop Solutions Limited	Subsidiary	100%
2.	EKL CSR Foundation (Formerly Escorts Skill Development)	Subsidiary	100%
3.	Escorts Finance Limited	Subsidiary	67.87%
4.	Farmtrac Tractors Europe Spolka Z.o.o.	Subsidiary	100%
5.	Escorts Benefit and Welfare Trust	Subsidiary	100%
6.	Escorts Benefit Trust	Subsidiary	100%
7.	Adico Escorts Agri Equipments Private Limited	Joint Venture	40%
8.	Escorts Kubota India Private Limited	Joint Venture	40%
9.	Kubota Agricultural Machinery India Private Limited	Joint Venture	40%
10.	Escorts Consumer Credit Limited	Associate	29.41%

The Annual Report on CSR activities is enclosed as Annexure - E and forms an integral part of this Report.

Consolidated Financial Statements

The Consolidated Financial Statements have been prepared in accordance with the Act and Indian Accounting Standard (IND AS) - 110 applicable to the Consolidated Financial Statements read with IND AS-28 on Accounting for Investments in Associates and IND AS-31 on Financial Reporting of Interests in Joint Ventures issued by The Institute of Chartered Accountants of India. The Audited Consolidated Financial Statements along with the Auditors'' Report thereon are annexed with this Report.

Subsidiaries, Joint Ventures and Associate Companies

In accordance with Section 129(3) of the Companies Act, 2013, a statement containing salient features of the financial statements of the Subsidiary, Associates and Joint Venture Companies in Form AOC-1 is provided in this Report. The statement also provides details of performance and financial position of each of the Subsidiary, Associates and Joint Venture Companies. Audited Financial Statements together with related information and other reports of each of the subsidiary companies have also been placed on the website of the Company at https://www.escortsaroup.com/investors/annual-reports.

The details of the above investments/ disinvestment are provided in the note 7 of the notes to accounts of Standalone Financial Statements of the Company.

Contracts and Arrangements with Related Parties

All contracts/ arrangements/ transactions entered by the Company during the financial year with related parties were in the ordinary course of business and on an arm''s length

html. The Consolidated Financial Statements presented by the Company include the financial results of its subsidiaries, associate and joint venture companies.

In terms of the Company''s Policy on determining “material subsidiary”, during the financial year ended March 31, 2023, there is no material subsidiary of the Company whose income exceeds 10% of the consolidated income of the Company in the immediately preceding financial year.

During the FY ended on March 31, 2023, the Company has sold its entire 49% stake i.e. 7,27,65,000 equity shares of H10/-each of Tadano Escorts India Private Limited (TEIPL), a joint venture between the Company and Tadano Limited, Japan (Tadano), to Tadano, at H0.01 Cr. on November 9, 2022.

Further, the Company has also acquired the entire equity share capital of Escorts Corp Solutions Limited (ECSL), apart from the existing equity shares already held by the Company. Consequently, ECSL has become the wholly owned subsidiary of the Company w.e.f. January 18, 2023.

The complete list of subsidiaries, joint ventures and associate companies as on March 31,2023, in terms of the Act and IND-AS is provided herein below: 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 of the Company on the materiality of related party transactions.

The particulars of contracts or arrangements, with related parties referred to in Section 188(1) of the Act, in the prescribed Form AOC-2, is appended as Annexure - F to this report.

The Policy on materiality of related party transactions and dealing with related party transactions may be accessed on the Company''s website at https://www.escortsgroup.com/ investors/governance.html.

Your Directors draw attention of the members to note 45 in the notes to accounts in the Standalone Financial Statements and to note 44 in the notes to accounts in the Consolidated Financial Statements which sets out related party disclosures.

Auditors and Auditors’ Report Statutory Auditors

Pursuant to the provisions of Section 139 of the Act read with rules thereunder, the shareholders of the Company at the 76th AGM held on July 14, 2022 had re-appointed M/s. Walker Chandiok & Co LLP, Chartered Accountants, New Delhi (Firm Registration No. 001076N/ N500013) as Statutory Auditors of the Company for a period of 5 years i.e. upto the conclusion of AGM to be held in the year 2027.

The comments given by M/s. Walker Chandiok & Co LLP, Chartered Accountants, Statutory Auditors, in their report read together with notes to accounts for the FY ended March 31, 2023 are self-explanatory and hence, do not call for any further explanations or comments under Section 134 of the Act.

Pursuant to provisions of the Section 143(12) of the Companies Act, 2013 neither the Statutory Auditors nor Secretarial Auditors nor Cost Auditors have reported any incident of fraud to the Audit Committee or the Board during the year under review.

Cost Auditors

Pursuant to the Section 148 of the Act read with rules thereunder, your Company is required to maintain the cost records and the said cost records are required to be audited.

The Company is maintaining all the aforesaid cost records.

The Board of Directors, on the recommendation of Audit Committee, has re-appointed M/s. Ramanath Iyer and Co., Cost Accountants (Firm Registration No. 000019), as Cost Auditors of the Company for conducting the audit of cost records for the FY 2023-24.

The due date of filing the Cost Audit Report for the year ended on March 31, 2022 was September 30, 2022 and the same had been filed on August 23, 2022.

Secretarial Auditors

The Board had appointed M/s. Jayant Gupta and Associates, Practicing Company Secretaries, as Secretarial Auditors to conduct secretarial audit of the Company for the FY 2022-23.

The Secretarial Audit Report of the Company as prescribed under Section 204 of the Act is annexed herewith as Annexure - G and forms an integral part of this Report.

The Secretarial Audit Report does not contain any qualification, reservation and adverse remarks and the comments given by the Secretarial Auditors in their report are self-explanatory and hence, do not call for any further explanations or comments under Section 204(3) of the Act.

The Board has also re-appointed M/s. Jayant Gupta and Associates, Practicing Company Secretaries to conduct secretarial audit of the Company for the FY 2023-24.

Risk Management

The Risk Management Committee of the Board has been entrusted with the responsibility to assist the Board in (a) Overseeing and approving the Company''s enterprise wide risk management framework; and (b) Overseeing that all the risks that the organisation faces such as strategic, financial, credit, market, liquidity, security, property, IT, legal, regulatory, reputational and other risks have been identified and assessed and there is an adequate risk management infrastructure in place capable of addressing those risks.

The Company has laid down a Risk Management Policy and the same is available on the website of the Company at https:// www¦escortsaroup¦com/investors/aovernance¦html.

The details of constitution of Risk Management Committee of the Company is provided in Report on Corporate Governance at Annexure - D of the Directors'' Report.

Internal Financial Control and its Adequacy

The Board has adopted policies and procedures for ensuring the orderly and efficient conduct of its business, including adherence to Company''s policies, the safeguarding of its assets, the prevention and detection of fraud, error reporting mechanisms, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial disclosures.

The Company has in place adequate internal financial controls for ensuring the orderly and efficient conduct of its business.

During the year, such controls were tested and no reportable material weakness in the design or operation was observed.

DisclosuresMeetings of the Board

Six meetings of the Board of Directors were held during the year. For further details, please refer Report on Corporate Governance annexed as Annexure - D to this Report.

Audit Committee

For constitution and other details of the Audit Committee, please refer Report on Corporate Governance annexed as Annexure - D to this Report.

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

CSR Committee

For constitution and other details of the CSR Committee, please refer Report on Corporate Governance annexed as Annexure - D to this Report.

Annual Return

The Annual Return for Financial Year 2022-23 is available on the Company''s website at https://www.escortsgroup.com/ other-documents.

Vigil Mechanism

The Company has adopted a Whistle Blower Policy establishing vigil mechanism for Directors and Employees to report their concerns about unethical behaviour, actual or suspected fraud or violation of the Company''s Code of Conduct. The mechanism provides for adequate safeguards against victimisation of effected Director(s) and Employee(s). In exceptional cases, Directors and Employees have direct access to the Chairman of the Audit Committee. It is affirmed that no personnel of the Company has been denied access to the Audit Committee.

The Whistle Blower Policy is available on Company''s website at https://www.escortsgroup.com/investors/governance.html.

Registrar and Share Transfer Agent

The Share Transfer and related activities are being carried out by M/s. KFin Technologies Limited (earlier KFin Technologies Private Limited), Registrar and Share Transfer Agent from the following address:

M/s. KFin Technologies Limited Selenium Building, Tower B, Plot No. 31-32,

Financial District, Nanakramguda, Serilingampally, Hyderabad, Rangareddy, Telangana - 500032

Particulars of Loans given, Investments made, Guarantees given and Securities provided

A statement regarding Loans/ Guarantees given and Investments covered under the provisions of the Section 186 of the Act is made in the notes to the financial statement.

Particulars of Employees and related disclosures

In terms of provisions of Section 197(12) of the Act, read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement showing the names and other particulars of the employees drawing remuneration in excess of the prescribed limits are available with the Company Secretary.

In terms of the first proviso to Section 136(1) of the Act, the Annual Report excluding the aforesaid information is being sent to the members of the Company. Any member interested in obtaining such particulars may write to the Company Secretary of the Company and the same will be furnished on request.

Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed as Annexure - H and forms an integral part of this Report.

Public Deposits

The Company has not accepted/ renewed any Fixed Deposit during the financial year under review and as such no amount of principal or interest was outstanding as of the Balance Sheet date.

Investor Education and Protection Fund (IEPF)

Pursuant to the applicable provisions of the Act, read with IEPF Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 (‘the Rules''), all unpaid or unclaimed dividends are required to be transferred by the Company to the IEPF established by the Central Government, after the completion of seven years. Accordingly, the Company has transferred H16.06 lakhs, pertaining to unclaimed dividend, during the period under review, to IEPF.

Further, according to the rules, the shares in respect of which dividend has not been paid or claimed by the shareholders for seven consecutive years or more shall also be transferred to the demat account created by the IEPF Authority. Accordingly, the Company has transferred 38,732 shares, during the period under review, to IEPF. The detailed information is available at our website www.escortsgroup.com.

As on March 31, 2023, no unclaimed deposits are pending which required to be transferred to IEPF.

Credit Rating

The present credit rating of the Company is as under:

CRISIL Limited and ICRA Limited granted long term rating as “AA with stable outlook” and Short-Term rating as “A1 ”

Material Changes and Commitment affecting the financial position

There are no material changes affecting the financial position of the Company subsequent to the closure of the FY 2023 till the date of this report.

Prevention of Sexual Harassment

The Company has zero tolerance for sexual harassment at workplace and has adopted a policy on Prevention, Prohibition and Redressal of Sexual Harassment at Workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the rules thereunder for prevention and redressal of complaints of sexual harassment at workplace. The Company is committed to provide equal opportunities without regard to their race, caste, sex, religion, colour, nationality, disability, etc. All women associates (permanent, temporary, contractual and trainees) as well as any women visiting the Company''s office premises or women service providers are covered under this Policy. Though the Company''s policy is gender neutral. All employees are treated with dignity with a view to maintain a work environment free of sexual harassment whether physical, verbal or psychological.

The Company has also 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.

Your directors further state that during the year under review, there were two cases filed pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the same have now been resolved.

Human Resources Management

Our professionals are our most important assets. We are committed to hiring and retaining the best talent being among the industry''s leading employers. For this, we focus on promoting a collaborative, transparent and participative organisation culture, and rewarding merit and sustain high performance. Our human resources management focuses on

allowing our employees to develop their skills, grow in their career and navigate their next.

Secretarial Standards

The Company is in compliance with all the applicable Secretarial Standards issued by the Institute of Company Secretaries of India.

Integrated Report

The Company has provided Integrated Report, which includes non-financial and financial information to have a better understanding of the Company''s long-term strategy. This report covers six forms of capital viz. financial capital, manufactured capital, intellectual capital, human capital, social and relationship capital and natural capital as per International framework.

Business Responsibility and Sustainability Report (BRSR)

In November 2018, the Ministry of Corporate Affairs (MCA) constituted a Committee on Business Responsibility Reporting (BRR) (“the Committee”) to finalize business responsibility reporting formats for listed and unlisted companies, based on the framework of the National Guidelines on Responsible Business Conduct (NGRBC). Through its report, the Committee recommended that BRR be rechristened BRSR, where disclosures are based on ESG Corporate Overview Management Discussion and Analysis Financial Statements parameters, compelling organizations to holistically engage with stakeholders and go beyond regulatory compliances in terms of business measures and their reporting. SEBI, vide its circular dated May 10, 2021, made BRSR mandatory for the top 1,000 listed companies (by market capitalization) from FY 2023. Further, pursuant to Regulation 34 of the SEBI Listing Regulations, the BRSR disclosures are enclosed as Annexure I and forms an integral part of this Report.

Application made or any proceeding pending under the Insolvency and Bankruptcy Code

As on the date of the report no application is pending under the Insolvency and Bankruptcy Code, 2016 against the Company and the Company did not file any application under (IBC) during the Financial Year 2022-23. Further, the Company has not made any one-time settlement.

Compliance by Large Corporate

Your Company does not fall under the category of large corporate, as defined under SEBI vide its circular SEBI/HO/ DDHS/CIR/P/2018/144 dated November 26, 2018, as such no disclosure is required in this regard.

Directors’ Responsibility Statement

Pursuant to the requirement under Section 134(5) of the Act, with respect to Directors'' Responsibility Statement, your Directors, to the best of their knowledge and ability, hereby confirm that:

(i) i n the preparation of the annual accounts for the year ended March 31, 2023, the applicable accounting standards read with requirements set out under Schedule III to the Act, have been followed along with proper explanation relating to material departures;

(ii) the Directors have selected such accounting policies and applied them consistently and made judgements 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 March 31, 2023 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 the 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 March 31, 2023 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 are operating effectively; and

(vi) t he Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

General

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

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

2. Issue of shares (including sweat equity shares) to employees of the Company under any scheme save and except ESOS referred to in this Report.

3. Neither the Managing Director nor the Whole-time Directors of the Company receive any remuneration or commission from any of its subsidiaries.

4. No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Company''s operations in future. However, members attention is drawn to note 32 in the notes to accounts in the Standalone Financial Statements and to note 33 in the notes to accounts in the Consolidated Financial Statements which sets out information on Commitments and Contingencies.

5. Details of difference between amount of valuation done at the time of one-time settlement and the valuation done while taking loan from the Banks or Financial Institutions along with the reasons thereof.

Acknowledgement

Your Directors would like to express their sincere appreciation of the positive co-operation received from the Central Government, the Government of Haryana and Karnataka, Financial Institutions and the Company''s Bankers, Customers, Dealers and all other business associates.

The Directors also wish to place on record their deep sense of appreciation for the commitment displayed by all executives, officers, workers, employee unions and staff of the Company resulting in the successful performance of the Company during the year.

The Board also takes this opportunity to express its deep gratitude for the continued co-operation and support received from its valued shareholders.

---

Mar 31, 2022

Your Directors have pleasure in presenting this Integrated Annual Report (‘Annual Report’) of the Company along with Company’s audited financial statements (standalone and consolidated) for the financial year ended on March 31, 2022.

Financial Results

('' crores)
	Standalone		Consolidated
Particulars	Year ended on March 31, 2022	Year ended on March 31, 2021	Year ended on March 31, 2022	Year ended on March 31, 2021
Revenue from operations	7,152.68	6929.29	7,238.43	7014.42
Other income	213.02	154.56	218.02	160.38
Total income	7,365.70	7083.85	7,456.45	7174.80
Profit from operations before Interest, Depreciation & Tax	1,164.33	1283.79	1,139.86	1286.40
Finance Cost	12.70	10.98	14.97	13.34
Profit from operations before Depreciation & Tax	1,151.63	1272.81	1,124.89	1273.06
Depreciation & Amortisation	129.75	115.70	132.06	118.28
Profit from operations before Tax	1,021.88	1157.11	992.83	1154.78
Tax Expense	256.27	283.05	257.22	283.15
Net profit for the period	765.61	874.06	735.61	871.63

Financial Performance/ State of Company Affairs

The brief highlights of the Company’s performance (Standalone) for the financial year (‘FY’) ended March 31, 2022 are:-

our Company sold 94,228 tractors during the year under review as against 1,06,741 tractors sold during the last financial year.

The brief highlights of the Company’s performance (Consolidated) for the FY ended March 31, 2022 are:-

• Total income of the Company for FY 2022 stood at '' 7,456.45 crores ('' 7,174.80 crores in FY 2021)

• Profit from operations before Interest, Depreciation & Tax stood at '' 1,139.86 crores.

• Profit from operations before Tax (PBT) stood at '' 992.83 crores. Net profit for the period stood at '' 735.61 crores.

The details on the individual businesses of the Company are provided in the Management Discussion & Analysis section provided in this annual report.

Management Discussion & Analysis

In terms of the provisions of Regulation 34 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred as the "SEBI Listing Regulations”), the Management Discussion and Analysis is set out in this Annual Report and provides a detailed analysis on the performance of individual businesses and their outlook.

Dividend

Based on the Company’s performance, your Directors are pleased to recommend, for approval of the members, Dividend @ 70% per share of face value of '' 10/- each (i.e. '' 7 per share) for the FY ended March 31, 2022, payable on all outstanding shares except on the equity shares held by ‘Escorts Benefit & Welfare Trust’ .

The dividend payout is subject to the approval of members at the ensuing Annual General Meeting (AGM).

The dividend payout for the period under review has been formulated in accordance with shareholders’ aspirations and the Company’s Dividend Distribution Policy to pay sustainable dividend linked to long-term growth objectives of the Company to be met by internal cash accruals.

The record date for the purpose of dividend will be July 1, 2022.

The dividend distribution policy is available on our website at https://www.escortsgroup.com/investors/governance.html.

Transfer to Reserves

An amount of '' 0.07 crores (previous year: '' 0.21 crores) transferred to general reserves on account of vested employees stock options lapsed during the FY ended March 31, 2022.

For complete details on movement in Reserves and Surplus during the financial year ended March 31, 2022, please refer the Statement of Changes in Equity and note 17 of the Standalone and Consolidated Financial Statements.

Employee Stock Option Scheme

The Escorts Employees Stock Option Scheme ("Scheme”) is in line with the SEBI (Share Based Employee Benefits and Sweat Equity) Regulations, 2021 ("SBEB Regulations”) and there were no material changes to the scheme during the financial year 2021-22. However, during the year under review, the Members of the Company had approved the following 2 (two) key variations to the Scheme:

(i) Vesting period extended from 4 (four) to 5 (five) years from the date of grant of option (for new grants);

(ii) Exercise period extended from 3 (three) to 5 (five) years from the last date of vesting (for new grants).

The amendments to the Scheme also contain certain editorial changes, such as modifications/deletion of definitions and provisions so as to conform to the Companies Act, 2013 (‘the Act’) and SBEB Regulations.: -

The Scheme is being implemented in accordance with the SBEB Regulations and the resolution passed by the members. The Secretarial Auditors certificate would be available during the AGM for inspection by the members. The details as required to be disclosed under the SBEB Regulations would be available on the Company’s website at www.escortsgroup.com.

Change in Share Capital

During the FY 2021-22, the Company allotted 93,63,726 shares, on preferential allotment basis, of face value '' 10 each at a premium of '' 1990/- each for a total consideration of '' 1,872.75 crores. Your Company also extinguished/ cancelled 1,22,57,688 equity shares (‘First Scheme of Reduction’), held by Escorts Benefit and Welfare Trust (‘EBWT’ or ‘Trust’) pursuant to the scheme approved by the Hon’ble National Company Law Tribunal, Chandigarh Bench (NCLT), without payment of any consideration, vide its order dated December 23, 2021 and upon necessary filings with the Registrar of Companies, NCT of Delhi and Haryana, the First Scheme of reduction has become effective on December 27, 2021. Consequently, the paid-up equity shares capital of the Company as of March 31, 2022 stood at '' 131,94,06,040 consisting of 13,19,40,604 equity shares of '' 10/- each.

Further, the Audit Committee and Board of Directors, in their meeting held on February 18, 2022, had approved the scheme for reduction of share capital (‘Second Capital Reduction’) for reduction of remaining 2,14,42,343 Equity Shares of '' 10/- each of the Company, held by the EBWT, without payment of any consideration. The same has been filed with BSE Limited and National Stock Exchange of India Limited to get no objection letter as required under Regulation 37 of the SEBI Listing Regulations.

Utilisation of Funds

The reporting of the utilisation of funds, as on March 31, 2022, raised through the above preferential allotment and the previous preferential allotment is as follows:

Original Object	Modified Object, if any	Original Allocation	Modified allocation, if any	Funds Utilised	Amount of Deviation/Variation ^ _ , Remarks if for the quarter according to any applicable object
For the Agri Machinery Business of the Not Company i.e. the business of manufacturing, Applicable assembly, sales, marketing, financing, servicing, research and development of: (a) tractors; (b) construction equipment (i.e., backhoe loaders and other items to be mutually agreed between Promoters and Kubota Corporation); (c) implements; (d) transmission for tractors, construction equipment (i.e., backhoe loaders and other items to be mutually agreed between the Promoters and Kubota Corporation) and implements; and (e) spare parts of the items referred in (a), (b), (c) and (d), and for the manufacture of engines by the Company		'' 1,041.90 crores	NIL	'' 318.35 crores (Including '' 176.05 crores utilised during the year)	NIL -
For expansion of its agri-machinery business of manufacturing, assembly, sales, marketing, financing, servicing, research and development of: (a) tractors; (b) combine harvester & rice transplanter; (c) utility vehicles; (d) turf equipment; (e) construction machinery; (f) engines; (g) implements; (h) transmission for tractors, construction equipment and implements; (i) other farm mechanisation equipment; (j) spare parts of the items referred in (a) to (i) above	Not Applicable	'' 1,855.31 crores*	NIL	NIL	NIL -

* Net proceeds post deduction of expenditure of '' 17.44 crores incurred towards preferential issue and allotment.

Directors and Key Managerial Personnel

In accordance with the provisions of the Act and Articles of Association of the Company, Mr. Hardeep Singh (DIN: 00088096) and Mr. Dai Watanabe (DIN: 08736520), Directors of the Company, retire by rotation at the ensuing Annual General Meeting (AGM) and being eligible, offer themselves for re-appointment.

The Company has received the nomination letter for two more Nominee Directors from Kubota Corporation ( Kubota), pursuant to the terms of the Shareholders’ Agreement (SHA) dated November 18, 2021, executed among and between the Company, Kubota, EBWT and the Specified Promoters (as specified in SHA), for appointment of following person as Directors of the Company :

a. Mr. Seiji Fukuoka - Whole Time Director to be designated as Deputy Managing Director

b. Mr. Shiro Watanabe - Non Executive Director

The Board of Directors, at its meeting held on May 13, 2022, has, on the recommendations of Nomination Remuneration and Compensation Committee ( NRC), appointed Mr. Seiji Fukuoka (DIN: 08786470), not liable to retire by rotation, and Mr. Shiro Watanabe (DIN: 09588547), liable to retire by rotation, as an Additional Directors of the Company. Mr. Seiji Fukuoka and Mr. Shiro Watanabe shall hold office of Director(s) upto date of ensuing AGM. However, the Company has also received requisite notices, in writing from Kubota, a member of the Company, proposing candidatures of Mr. Seiji Fukuoka and Mr. Shiro Watanabe for the said appointment. Accordingly, Board of Directors, based upon the recommendation of the NRC, had recommended the appointments, to shareholders for approval, of Mr. Seiji Fukuoka, as Whole Time Director designated as Deputy Managing Director for a period of 5 years w.e.f. May 13, 2022 along with his remuneration, not liable to retire by rotation, and Mr. Shiro Watanabe, as Non-Executive Director, liable to retire by rotation, in the ensuing AGM.

In order to meet the criteria of 50% independent directors on the Board, the Board of Directors, at its meeting held on

May 13, 2022, on the recommendations of NRC, appointed Mr. Ravindra Chandra Bhargava (DIN: 00007620) and Mr. Kenichiro Toyofuku (DIN: 08619076) as an ‘Additional Independent Director. They shall hold office as an Additional Independent Director(s) of the Company upto the date of ensuing Annual General Meeting. However, the Company has also received requisite notices, in writing from a member of the Company, proposing candidatures of Ravindra Chandra Bhargava and Mr. Kenichiro Toyofuku for the said appointment. Accordingly, Board of Directors, based upon the recommendation of the NRC, had recommended the appointment to shareholders for approval for a period of 5 years w.e.f. May 13, 2022, not liable to retire by rotation, in the ensuing AGM.

The NRC and the Board at their respective meetings have assessed their candidature and are of view that Mr. Seiji Fukuoka, Mr. Shiro Watanabe, Mr. Ravindra Chandra Bhargava and Mr. Kenichiro Toyofuku possesses necessary competencies and skill identified by the Board of directors for effective managing its business.

The tenure of Mr. P.H. Ravikumar and Mrs. Vibha Paul Rishi, Independent Directors is expiring in the ensuing AGM. Mr. Ravikumar and Mrs. Rishi were appointed as an Independent Directors in 2014 and completing the second term which will be ending in the ensuing AGM. The Board of Directors upon recommendation of the NRC has recommended the appointment of Mr. Vimal Bhandari (DIN: 00001318) and Mrs. Reema Rameshchandra Nanavati (DIN: 00690270), as Independent Directors, not liable to retire by rotation, from the conclusion of ensuing Annual General Meeting for a period of 5 consequent years.

The Board of Directors, in its meeting held on May 13, 2022, has, on the recommendations of Nomination Remuneration and Compensation Committee (NRC), has recommended the re-appointment and remuneration of Mr. Nikhil Nanda (DIN: 00043432) as Managing Director, not liable to retire by rotation, for a period of 5 years w.e.f. September 19, 2022, for shareholders approval.

The Company has received declarations from all Independent Directors of the Company that they meet the criteria of independence as prescribed under subsection (6) of Section 149 of the Act and under Regulation 16 and 25 of SEBI Listing Regulations and there has been no change in the circumstances affecting their status as independent director of the Company. The Company has also received a declaration from all the independent directors that they have registered their names in the independent director data bank and pass/ exempt requisite proficiency test conducted by Ministry of Corporate Affairs.

The policy on Appointment and Removal of Director’s and Members of Senior Management was reviewed and amended by the Board at its meeting held on May 13, 2022.

The said policy is annexed as Annexure - A and forms an integral part of this Report.

Annual performance evaluation of the Board, its committees and individual directors (including independent directors) pursuant to the provisions of the Act and the Corporate Governance requirements under SEBI Listing Regulations have been carried out. In accordance with the Policy, a process was followed by the Board for evaluation of its own performance and its committees and individual Directors including independent directors.

The remuneration policy for directors, key managerial personnel, senior management and other employees was reviewed and amended by the Board at its meeting held on May 13, 2022. The said policy is annexed as Annexure - B and forms an integral part of this Report.

The Company has devised a process whereby various presentations/ programs are being conducted to familiarise the Directors with various developments at Industry level, new business initiatives and organisation strategies etc. The details of programme for familiarisation of Independent Directors with the Company, their roles, rights, responsibilities in the Company, nature of industry in which the Company operates, business model of the Company and related matters are put up on the website of the Company - www.escortsgroup.com.

The Company recognises and embraces the importance of a diverse board in its success. Your Company believes that a truly diverse board will leverage differences in thought, perspective, knowledge, skill, regional and industry experience, cultural and geographical background, age, ethnicity, race and gender, which will help it retain its competitive advantage.

The brief resumes and other details relating to the Directors who are proposed to be appointed/ re-appointed, as required to be disclosed as per the provisions of the SEBI Listing Regulations/ secretarial standard is given in the Annexure to the Notice of the 76^th AGM.

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

The particulars relating to conservation of energy, technology absorption, foreign exchange earnings and outgo, as required to be disclosed under Section 134(3)(m) of the Act read with Companies (Accounts) Rules, 2014 are provided as Annexure - C and forms an integral part of this Report.

Corporate Governance

Corporate Governance is about maximising shareholders value, ethically and sustainably. At Escorts the goal of corporate governance is to ensure fairness for every stakeholder. Your Company believes that strong corporate governance is critical to enhancing and retaining investor

trust. Your Company also endeavours to enhance long term shareholder value and respect minority rights in all its business decisions.

Your Company reaffirms its commitment to the good corporate governance practices and has adopted the Code of Business Conduct which has set out the systems, processes and policies conforming to international standards. Pursuant to Regulation 34(3) of the SEBI Listing Regulations, Corporate Governance Report and a Certificate regarding compliance of conditions of Corporate Governance from Company Secretary in Practice are enclosed as Annexure -D and forms an integral part of this Report.

Corporate Social Responsibility (CSR)

The key philosophy of all CSR initiatives of the Company is to make CSR a key business process for sustainable development of the society. The initiatives aim at enhancing welfare measures of the society based on the immediate and long term social and environmental consequence of its activities. The Company intends to undertake other need-based initiatives in compliance with Schedule VII of the Act.

The CSR Policy may be accessed on the Company’s website www.escortsgroup.com under Investors Information Section. During the year, the Company has spent '' 15.83 crores. {Including amount transferred to unspent CSR account (refer note 29 of the Standalone Financial Statement)}.

During FY ended March 31, 2022, the Company has spent '' 6.91 crores on various projects. The balance of '' 8.92 crores, towards ongoing project, had been transferred to unspent CSR account and will be spent in accordance with the provisions of the Act.

The Annual Report on CSR activities is enclosed as Annexure - E and forms an integral part of this Report.

Consolidated Financial Statements

The Consolidated Financial Statements have been prepared in accordance with the Act and Indian Accounting Standard (IND AS)-110 applicable to the Consolidated Financial Statements read with IND AS-28 on Accounting for Investments in Associates and IND AS-31 on Financial Reporting of Interests in Joint Ventures issued by The Institute of Chartered Accountants of India. The Audited Consolidated Financial Statements along with the Auditors’ Report thereon are annexed with this Report.

Subsidiaries, Joint Ventures and Associate Companies

In accordance with Section 129(3) of the Act, a statement containing salient features of the financial statements of the subsidiary companies in Form AOC-1 is provided in this report. The statement also provides details of performance and financial position of each of the subsidiaries. Audited financial statements together with related information and

other reports of each of the subsidiary companies have also been placed on the website of the Company at https:// www.escortsgroup.com/investors/annual-reports.html. The Consolidated Financial Statements presented by the Company include the financial results of its subsidiaries, associate and joint venture companies.

In terms of the Company’s Policy on determining "material subsidiary”, during the FY ended March 31, 2022, there is no material subsidiary of the Company whose income exceeds 10% of the consolidated income of the Company in the immediately preceding FY.

During the FY ended on March 31, 2022, the Company has infused additional equity capital in the following Companies:

1. Escorts Crop Solutions Limited, Subsidiary

2. Tadano Escorts India Private Limited, Joint Venture

Further, the Company has also acquired the remaining equity share capital of M/s Escorts Skill Development (ESD), apart from the existing equity shares already held by the Company. Consequently, ESD has become the wholly owned subsidiary of the Company w.e.f. November 1, 2021.

The complete list of subsidiaries, joint ventures and associate companies as on March 31, 2022, in terms of the Act and IND-AS is provided herein below:

Sl. No.	Name of the subsidiary / associate companies / joint ventures	Relationship	% of shares
1	Escorts Crop Solutions Limited	Subsidiary	*100%
2	Escorts Skill Development	Subsidiary	100%
3	Escorts Finance Limited	Subsidiary	69.42%
4	Farmtrac Tractors Europe Spolka Z.o.o.	Subsidiary	100%
5	Escorts Benefit and Welfare Trust	Subsidiary	100%
6	Escorts Benefit Trust	Subsidiary	100%
7	Adico Escorts Agri Equipments Joint Venture Private Limited		40%
8	Tadano Escorts India Limited	Joint Venture	40%
9	Escorts Kubota India Private Limited	Joint Venture	40%
10	Kubota Agricultural Machinery India Private Limited	Joint Venture	40%
11	Escorts Consumer Credit Limited	Associate	29.4%

* Rounded off to 100%

During the year under review , the Company along with other shareholders of Escorts Securities Limited ("ESL”), has transferred the entire shareholding in ESL to M/s Choice Equity Broking Private Limited and their nominee consequently ESL ceased to be Subsidiary of the Company w.e.f. February 14, 2022.

The details of the above investments/ disinvestment are provided in the note 7 & 15 of the Notes to Accounts of Standalone Financial Statements of the Company.

Contracts and Arrangements with Related Parties

All contracts/ arrangements/ transactions entered 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 of the Company on the materiality of related party transactions. However, the Company has obtained the approval of shareholders, by way of Postal Ballot, for material related party transaction(s) with M/s Kubota Corporation and its subsidiary(ies)/ group company(ies), for a period of

5 years, effective from the date of commencement of SHA.

The particulars of contracts or arrangements, with related parties referred to in Section 188(1) of the Act, in the prescribed Form AOC-2, is appended as Annexure - F to this report.

The Policy on materiality of related party transactions and dealing with related party transactions may be accessed on the Company’s website www.escortsgroup.com under Investors Information Section.

Your Directors draw attention of the members to note 45 in the notes to accounts in the Standalone Financial Statement and to note 45 in the notes to accounts in the Consolidated Financial Statement which sets out related party disclosures.

Auditors and Auditors’ Report Statutory Auditors

Pursuant to the provisions of Section 139 of the Act read with rules thereunder, M/s Walker Chandiok & Co LLP, Chartered Accountants (Firm Registration No. 001076N/ N500013), were appointed as statutory auditors of the Company for a term of five (5) years from the conclusion of 71^st AGM, held on September 21, 2017, till the conclusion of the 76^th AGM to be held in the year 2022.

The Board of Directors, at its meeting held on May 13, 2022, on the recommendation of Audit Committee, had recommended the re-appointment of M/s. Walker Chandiok

6 Co LLP, Chartered Accountants (Firm Registration No. 001076N/N500013), as Statutory Auditors of the Company, for another period of five (5) years, to hold office from the conclusion of the ensuing AGM till the conclusion of the AGM to be held in the year 2027.

The Company has received a letter from M/s. Walker Chandiok & Co LLP, Chartered Accountants confirming that their appointment, if made, would be within the limits prescribed under Section 139 of the Act and that they are not disqualified for such appointment within the meaning of Section 141 of the Act, read with rules thereunder.

The comments given by M/s. Walker Chandiok & Co LLP, Chartered Accountants, Statutory Auditors, in their report read together with notes to Accounts for the FY ended March 31, 2022 are self-explanatory and hence, do not call for any further explanations or comments under Section 134 of the Act.

Pursuant to provisions of the Section 143(12) of the Act neither the statutory auditors nor Secretarial auditors nor Cost Auditors have reported any incident of fraud to the Audit Committee or the Board during the year under review.

Cost Auditors

Pursuant to the Section 148 of the Act read with rules thereunder, your Company is required to maintain the cost records and the said cost records are required to be audited.

Accordingly, maintaining of cost records is applicable to the Company and the Company is maintaining all the aforesaid cost records.

The Board of Directors, on the recommendation of Audit Committee, has re-appointed M/s. Ramanath Iyer and Co., Cost Accountants (Firm Registration No. 000019), as Cost Auditors of the Company for conducting the audit of cost records for the financial year 2022-23.

The due date of filing the Cost Audit Report for the year ended on March 31, 2021 was September 30, 2021 and the same had been filed on August 27, 2021.

Secretarial Auditors

The Board had appointed M/s. Jayant Gupta and Associates, Practicing Company Secretaries, as Secretarial Auditors to conduct secretarial audit of the Company for the financial year 2021-22.

The Secretarial Audit Report of the Company as prescribed under Section 204 of the Act is annexed herewith as Annexure - G and forms an integral part of this Report.

The Secretarial Audit report does not contain any qualification, reservation and adverse remarks and the comments given by the Secretarial Auditors in their report are self-explanatory and hence, do not call for any further explanations or comments under Section 204(3) of the Act.

The Board has also re-appointed M/s. Jayant Gupta and Associates, Practicing Company Secretaries to conduct secretarial audit of the Company for the FY 2022-23.

Risk Management

The Risk Management Committee of the Board has been entrusted with the responsibility to assist the Board in (a) Overseeing and approving the Company’s enterprise wide risk management framework; and (b) Overseeing that all the risks that the organisation faces such as strategic, financial, credit, market, liquidity, security, property, IT, legal,

regulatory, reputational and other risks have been identified and assessed and there is an adequate risk management infrastructure in place capable of addressing those risks.

The Company has laid down a Risk Management Policy and the same is available on the website of the Company at https://www.escortsgroup.com/investors/governance.html

The details of constitution of Risk Management Committee of the Company is provided in Report on Corporate Governance at Annexure - D of the Directors’ Report.

Internal Financial Control and its Adequacy

The Board has adopted policies and procedures for ensuring the orderly and efficient conduct of its business, including adherence to Company’s policies, the safeguarding of its assets, the prevention and detection of fraud, error reporting mechanisms, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial disclosures.

The Company has in place adequate internal financial controls for ensuring the orderly and efficient conduct of its business.

During the year, such controls were tested and no reportable material weakness in the design or operation was observed.

Disclosures Meetings of the Board

Eight meetings of the Board of Directors were held during the year. A detailed note on the composition of the Board including its committees are provided in the Corporate Governance Report.

Audit Committee

For constitution and other details of the Audit Committee, please refer Report on Corporate Governance annexed as Annexure - D to this Report.

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

CSR Committee

For constitution and other details of the CSR Committee, please refer Report on Corporate Governance annexed as Annexure - D to this Report.

Annual Return

The Annual Return for Financial Year 2021-22 is available on the Company’s website at www.escortsgroup.com.

Vigil Mechanism

The Company has adopted a Whistle Blower Policy establishing vigil mechanism for Directors and Employees to report their concerns about unethical behaviour, actual or suspected fraud or violation of the Company’s Code of Conduct. The mechanism provides for adequate

safeguards against victimisation of effected Director(s) and Employee(s). In exceptional or appropriate cases, Directors and Employees have direct access to the Chairman of the Audit Committee. It is affirmed that no personnel of the Company has been denied access to the Audit Committee.

The Whistle Blower Policy is available on Company’s website at https://www.escortsgroup.com/investors/ governance.html.

Registrar and Share Transfer Agent

The Share Transfer and related activities are being carried out by M/s KFin Technologies Limited (earlier KFin Technologies Private Limited), Registrar and Share Transfer Agent from the following address:-

M/s KFin Technologies Limited

Tower B, Plot No. 31-32, Selenium Building,

Gachibowli, Financial District, Nanakramguda, Hyderabad-500032, Telangana

Shareholders’ Agreement

During the year, the Company, Kubota Corporation, Japan (‘Kubota’), Escorts Benefit and Welfare Trust (‘EBWT’ or ‘Trust’) and the Specified Promoter (as specified in the shareholders’ agreement) had entered into an shareholders’ agreement on November 18, 2021 (Shareholders’ Agreement or SHA) with a common objective of making the Company a global leader in the manufacture, assembly, sales, marketing, financing, servicing, research and development of value-based tractors and relationship amongst them regarding their rights and obligations, and other matters in connection therewith including undertaking the specific obligations as set out in this SHA. The said SHA was become effective from April 11, 2022 post completion of Open Offer pursuant to the provisions of Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeover) Regulations, 2011, consequently, Kubota acquired control over the Company and became the joint promoter of the Company.

Particulars of Loans given, Investments made, Guarantees given and Securities provided

A statement regarding Loans/ Guarantees given and Investments covered under the provisions of the Section 186 of the Act is made in the notes to the financial statement.

Particulars of Employees and related disclosures

In terms of provisions of Section 197(12) of the Act, read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement showing the names and other particulars of the employees drawing remuneration in excess of the prescribed limits are available with the Company Secretary.

in terms of the first proviso to Section 136(1) of the Act, the Annual Report excluding the aforesaid information is being sent to the members of the Company. Any member

interested in obtaining such particulars may write to the Company Secretary of the Company and the same will be furnished on request.

Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed as Annexure - H and forms an integral part of this Report.

Public Deposits

The Company has not accepted/ renewed any Fixed Deposit during the financial year under review and as such no amount of principal or interest was outstanding as of the Balance Sheet date.

Investor Education and Protection Fund (IEPF)

Pursuant to the applicable provisions of the Act, read with IEPF Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 (‘the Rules’), all unpaid or unclaimed dividends are required to be transferred by the Company to the IEPF established by the Central Government, after the completion of seven years. Accordingly, the Company has transferred '' 9.08 lakhs, pertaining to unclaimed dividend, during the period under review, to IEPF.

Further, according to the rules, the shares in respect of which dividend has not been paid or claimed by the shareholders for seven consecutive years or more shall also be transferred to the demat account created by the IEPF Authority. The detailed information is available at our website www. escortsgroup.com.

As on March 31, 2022, no unclaimed deposits are pending which required to be transferred to Investor Education and Protection Fund.

Credit Rating

The present credit rating of the Company is as under:

ICRA Limited has upgraded the long-term rating by one notch from "ICRA AA” to "ICRA “AA ” with revision in outlook from “watch with developing implication” to “Stable” and reaffirmed Short-term rating at "ICRA A1 ”.

CRISIL has upgraded the long term rating by one notch from “CRISIL AA” to “CRISIL AA ” with revision in outlook from "watch with positive implications” to "Stable” and reaffirmed Short-term rating at “CRISIL A1 ”.

Material Changes and Commitment affecting the financial position

There are no material changes affecting the financial position of the Company subsequent to the closure of the FY 2022 till the date of this report.

Prevention of Sexual Harassment

The Company has zero tolerance for sexual harassment at workplace and has adopted a policy on Prevention, Prohibition

and Redressal of Sexual Harassment at Workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the rules thereunder for prevention and redressal of complaints of sexual harassment at workplace. The Company is committed to provide equal opportunities without regard to their race, caste, sex, religion, colour, nationality, disability, etc. All women associates (permanent, temporary, contractual and trainees) as well as any women visiting the Company’s office premises or women service providers are covered under this Policy. All employees are treated with dignity with a view to maintain a work environment free of sexual harassment whether physical, verbal or psychological.

The Company has also 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.

Your Directors further state that 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.

Human Resources Management

Our professional are our most important assets. We are committed to hiring and retaining the best talent being among the industry’s leading employers. For this, we focus on promoting a collaborative, transparent and participative organisation culture, and rewarding merit and sustain high performance. Our human resources management focuses on allowing our employees to develop their skills, grow in their career and navigate their next.

Secretarial Standards

The Company is in compliance with all the applicable Secretarial Standards issued by the Instituted of Company Secretary of India.

Integrated Report

The Company, has voluntarily provided Integrated Report, which includes non-financial and financial information to have a better understanding of the Company’s long term strategy. This report covers six forms of capital viz. financial capital, manufactured capital, intellectual capital, human capital, social and relationship capital and natural capital as per International framework.

Business Responsibility and Sustainability Report (BRSR)

In November 2018, the Ministry of Corporate Affairs (MCA) constituted a Committee on Business Responsibility Reporting (“the Committee”) to finalize business responsibility reporting formats for listed and unlisted companies, based on the framework of the National Guidelines on Responsible Business Conduct (NGRBC). Through its report, the Committee recommended that BRR be rechristened BRSR, where disclosures are based on ESG

parameters, compelling organizations to holistically engage with stakeholders and go beyond regulatory compliances in terms of business measures and their reporting. SEBI, vide its circular dated May 10, 2021, made BRSR mandatory for the top 1,000 listed companies (by market capitalization) from FY 2023, while disclosure is voluntary for FY 2022 .

The Committee Report encourages companies to report their performance for FY 2022 to be better prepared to adopt this framework from the next FY. Escorts has adopted the BRSR voluntarily for FY 2022. The BRSR disclosures form a part of Escorts’ Integrated Annual Report 2021-22.

Application made or any proceeding pending under the Insolvency and Bankruptcy Code

As on the date of the Report no application is pending under the Insolvency and Bankruptcy Code, 2016 and the Company did not file any application under (IBC) during the Financial Year 2021-22. Further, the Company has not made any one-time settlement.

Compliance by Large Corporate

Your Company does not fall under the category of large corporate, as defined under SEBI vide its circular SEBI/HO/ DDHS/GR/P/2018/144 dated November 26, 2018, as such no disclosure is required in this regard.

Directors’ Responsibility Statement

Pursuant to the requirement under Section 134(5) of the Act, with respect to Directors’ Responsibility Statement, your Directors, to the best of their knowledge and ability, hereby confirm that:

(i) i n the preparation of the annual accounts for the year ended March 31, 2022, the applicable accounting standards read with requirements set out under Schedule III to the Act, have been followed alongwith proper explanation relating to material departures;

(ii) the Directors have selected such accounting policies and applied them consistently and made judgements 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 March 31, 2022 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 the Act, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(iv) t he Directors have prepared the annual accounts for financial year ended March 31, 2022 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 are operating effectively; and

(vi) the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

General

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

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

2. i ssue of shares (including sweat equity shares) to employees of the Company under any scheme save and except ESOS referred to in this Report.

3. Neither the Managing Director nor the Whole Time Directors of the Company receive any remuneration or commission from any of its subsidiaries.

4. No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Company’s operations in future. However, members attention is drawn to note 32 in the notes to accounts in the standalone financial statement and to note 33 in the notes to accounts in the consolidated financial statement which sets out information on Commitments and Contingencies.

5. Details of difference between amount of valuation done at the time of one time settlement and the valuation done while taking loan from the Banks or Financial Institutions along with the reasons thereof.

Acknowledgement

Your Directors would like to express their sincere appreciation of the positive co-operation received from the Central Government, the Government of Haryana and Karnataka, Financial Institutions and the Company’s Bankers, Customers, Dealers and all other business associates.

The Directors also wish to place on record their deep sense of appreciation for the commitment displayed by all executives, officers, workers, employee unions and staff of the Company resulting in the successful performance of the Company during the year.

The Board also takes this opportunity to express its deep gratitude for the continued co-operation and support received from its valued shareholders.

For and on behalf of the Board of Directors

Sd/-

Place: Faridabad Nikhil Nanda

Date: May 13, 2022 Chairman and Managing Director

---

Mar 31, 2021

Your Directors have pleasure in presenting the Seventy Fifth Annual Report of the Company along with Company’s audited financial statements (standalone and consolidated) for the financial year ended on March 31, 2021.

Financial Results

('' crores)
Particulars	Stand	alone	Conso	idated
	Year ended on March 31, 2021	Year ended on March 31, 2020	Year ended on March 31, 2021	Year ended on March 31, 2020
Revenue from operations	6929.29	5760.95	7,014.42	5,810.09
Other income	154.56	92.25	160.38	97.60
Total income	7083.85	5853.20	7,174.80	5,907.69
Profit from operations before Interest, Depreciation, Exceptional Items & Tax	1283.79	768.07	1,286.40	758.92
Finance Cost	10.98	15.46	13.34	17.23
Profit from operations before Depreciation, Exceptional Items & Tax	1272.81	752.61	1,273.06	741.69
Depreciation & Amortisation	115.70	104.55	118.28	107.22
Profit from operations before Exceptional Items & Tax	1157.11	648.06	1,154.78	634.47
Exceptional Item	-	(9.22)	-	(9.22)
Profit from operations before Tax	1157.11	638.84	1,154.78	625.25
Tax Expense	283.05	153.30	283.15	153.53
Profit from operations after Tax	874.06	485.54	871.63	471.72
Net profit for the period	874.06	485.54	871.63	471.72

Your Company sold 106741 tractors during the year under ) review as against 86018 tractors sold during the last financial year. The directors are also pleased to inform that in fiscal 2020-21, for the first time ever in any financial year, your Company has crossed the 1,00,000 unit landmark in terms of tractor sales and tractor production in India.

The brief highlights of the Company’s performance (Consolidated) for the financial year ended March 31, 2021 are:-

• Total income of the Company for FY 2021 stood at '' 7,174.80 crores ('' 5,907.69 crores in FY 2020)

• Profit from operations before Interest, Depreciation, Exceptional Items & Tax stood at '' 1,286.40 crores.

• Profit from operations before Tax (PBT) stood at '' 1,154.78 crores. Net profit for the period stood at '' 871.63 crores.

The details on the individual businesses of the Company are provided in the Management Discussion & Analysis section provided in this annual report. On our response to COVID-19 pandemic, please refer sustainability report at page 70.

Management Discussion & Analysis

In terms of the provisions of Regulation 34 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred as the "SEBI Listing Regulations”), the Management Discussion and Analysis is set out in this Annual Report and provides a detailed analysis on the performance of individual businesses and their outlook.

Dividend

Based on the Company’s performance, your Directors are pleased to recommend, for approval of the members, the following dividend for the financial year ended March 31, 2021:

a. Normal Final Dividend @ 50% per share of Face Value of '' 10/- each (i.e. '' 5.00 per share)

b. Additional Special one-time Platinum Jubilee (75th Year) Dividend @ 25% per share of Face Value of '' 10/- each (i.e. '' 2.50 per share)

c. Total Dividend @ 75% per share i.e. '' 7.50 per equity share payable on all outstanding shares except on the equity shares held by Escorts Benefit & Welfare Trust.

The dividend payout is subject to the approval of members at the ensuing Annual General Meeting (AGM).

The dividend payout for the period under review has been formulated in accordance with shareholders’ aspirations and the Company’s Dividend Distribution Policy to pay sustainable dividend linked to long-term growth objectives of the Company to be met by internal cash accruals.

The dividend distribution policy is available on our website at https://www.escortsaroup.com/investors/aovernance.html.

Employee Stock Option Scheme

The Escorts Employees Stock Option Scheme ("Scheme”) is in line with the SEBI (Share Based Employee Benefits) Regulations, 2014 ("SBEB Regulations”) and there were no material changes to the scheme during the financial year 202021. The Scheme is being implemented in accordance with the SBEB Regulations and the resolutions passed by the members. The auditors certificate would be available during the Annual General Meeting for inspection by members. The details as required to be disclosed under the SBEB Regulations would be available on the Company’s website at www.escortsgroup.com.

The Board of Directors in its meeting held on May 14, 2021 on the recommendation of the Nomination, Remuneration and Compensation Committee meeting held on May 11, 2021, has approved the changes in Employee Stock Option Scheme (‘Scheme’) of the Company subject to the approval of shareholders of the Company.

Directors and Key Managerial Personnel

In accordance with the provisions of Companies Act, 2013 (hereinafter referred as "the Act”) and Articles of Association of the Company, Mr. Shailendra Agrawal (DIN: 03108241) and Ms. Nitasha Nanda (DIN: 00032660), Directors retire by rotation at the ensuing AGM and being eligible, offer themselves for re-appointment.

The Board of Directors in its meeting held on July 16, 2020 co-opted Mr. Harish N. Salve (DIN: 01399172) as an Additional and Independent Director on the Board of the Company on the recommendations of Nomination and Remuneration Committee. The Board considered the domain knowledge and experience of Mr. Harish N. Salve in the areas of constitutional, commercial and taxation law while approving his appointment as an Independent Director on the Board of the Company. The Board is of the opinion that Mr. Harish N. Salve possesses requisite qualification, experience, expertise and holds high standard of integrity. Mr. Salve was regularised as Independent Director in the Annual General Meeting held on August 24, 2020.

The Board of Directors in its meeting held on July 16, 2020, appointed Mr. Dai Watanabe (DIN: 08736520) and Mr. Yuji Tomiyama (DIN: 08779472) as an additional directors on the Board of the Company based on the recommendations of the Nomination and Remuneration Committee of the Company and pursuant to the Share Subscription Agreement dated March 20, 2020 read with the amendment agreement dated July 15, 2020 ("SSA”), with Kubota Corporation, Japan and certain Specified Promoters. The shareholders of the Company in the Annual General Meeting held on August 24, 2020 had approved the regularization of Mr. Watanabe and Mr. Tomiyama as the Non-Executive Directors of the Company.

The Company has received declarations from all the Independent Directors of the Company confirming that they meet with criteria of independence as prescribed under subsection (6) of Section 149 of the Act and under Regulation 16(1)(b) & 25(8) of SEBI (Listing Obligations and Disclosure Requirements) Regulation, 2015 (hereinafter referred as "the Listing Regulations”). The policy on Appointment and Removal of Director’s and Members of Senior Management is attached as Annexure - A and forms an integral part of this Report.

The Company has devised a Policy for performance evaluation of Independent Directors, Board, Board Committees and individual Directors, which includes criteria for performance evaluation of the Non-Executive and Executive Directors. In accordance with the Policy, a process was followed by the Board for evaluation of its own performance and that of its Committees and individual Directors. The remuneration policy for directors, key managerial personnel, senior management and other employees is annexed as Annexure - B and forms an integral part of this Report.

The due date of filing the Cost Audit Report for the year ended on March 31, 2020 was September 30, 2020 and the same had been filed on August 24, 2020.

Further, this is to confirm that the requirement of maintaining cost records as per Section 148(1) of the Act is applicable to the Company and accordingly, the Company has made and maintained cost records.

Secretarial Auditors

The Board of Directors of the Company had appointed M/s. Jayant Gupta and Associates, Practicing Company Secretaries to conduct secretarial audit of the Company for the financial year 2020-21.

The Secretarial Audit Report for the financial year ended March 31, 2021 is enclosed as Annexure - G and forms an integral part of this Report.

The observations and comments given by the Secretarial Auditors in their report are self-explanatory and hence, do not call for any further comments under Section 204(3) of the Act.

The Board has also re-appointed M/s. Jayant Gupta and Associates, Practicing Company Secretaries to conduct secretarial audit of the Company for the financial year 2021-22.

Risk Management

The Risk Management Committee of the Board has been entrusted with the responsibility to assist the Board in (a) Overseeing and approving the Company’s enterprise wide risk management framework; and (b) Overseeing that all the risks that the organisation faces such as strategic, financial, credit, market, liquidity, security, property, IT, legal, regulatory, reputational and other risks have been identified and assessed and there is an adequate risk management infrastructure in place capable of addressing those risks.

The Company has laid down a Risk Management Policy and the same is available on the website of the Company at https:// www.escortsaroup.com/investors/aovernance.html

The details of constitution of Risk Management Committee of the Company is provided in Report on Corporate Governance at Annexure - D of the Directors’ Report.

Internal Financial Control and its Adequacy

The Board has adopted policies and procedures for ensuring the orderly and efficient conduct of its business, including adherence to Company’s policies, the safeguarding of its assets, the prevention and detection of fraud, error reporting mechanisms, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial disclosures.

The Company has in place adequate internal financial controls for ensuring the orderly and efficient conduct of its business.

The Company has devised a process whereby various presentations/ programs are being conducted to familiarise the Directors with various developments at Industry level, new business initiatives and organisation strategies etc.

The details of programme for familiarisation of Independent Directors with the Company, their roles, rights, responsibilities in the Company, nature of industry in which the Company operates, business model of the Company and related matters are put up on the website of the Company - www.escortsgroup.com.

The Company recognises and embraces the importance of a diverse board in its success. Your Company believes that a truly diverse board will leverage differences in thought, perspective, knowledge, skill, regional and industry experience, cultural and geographical background, age, ethnicity, race and gender, which will help it retain its competitive advantage.

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

The particulars relating to conservation of energy, technology absorption, foreign exchange earnings and outgo, as required to be disclosed under Section 134(3)(m) of the Act read with Companies (Accounts) Rules, 2014 are provided as Annexure - C and forms an integral part of this Report.

Corporate Governance

Corporate Governance is about maximising shareholders value, ethically and sustainably. At Escorts the goal of corporate governance is to ensure fairness for every stakeholder. Your Company believes that strong corporate governance is critical to enhancing and retaining investor trust. Your Company also endeavours to enhance long term shareholder value and respect minority rights in all its business decisions.

Your Company reaffirms its commitment to the good corporate governance practices and has adopted the Code of Business Conduct which has set out the systems, processes and policies conforming to international standards. Pursuant to Regulation 34(3) of the SEBI Listing Regulations, Corporate Governance Report and Auditors’ Certificate regarding compliance of conditions of Corporate Governance are enclosed as Annexure - D and forms an integral part of this Report.

Corporate Social Responsibility (CSR)

The key philosophy of all CSR initiatives of the Company is to make CSR a key business process for sustainable development of the society. The initiatives aim at enhancing welfare measures of the society based on the immediate and long term social and environmental consequence of its activities.

The Company intends to undertake other need-based initiatives in compliance with Schedule VII of the Act.

The CSR Policy may be accessed on the Company’s website www.escortsgroup.com under Investors Information Section. During the year, the Company has spent '' 11.82 crores. ^Including amount transferred to unspent CSR account (refer note 30 of the standalone financial statements)

The Annual Report on CSR activities is enclosed as Annexure - E and forms an integral part of this Report.

Consolidated Financial Statements

The Consolidated Financial Statements have been prepared in accordance with the Act and Indian Accounting Standard (IND AS) - 110 applicable to the Consolidated Financial Statements read with IND AS-28 on Accounting for Investments in Associates and IND AS-31 on Financial Reporting of Interests in Joint Ventures issued by The Institute of Chartered Accountants of India. The Audited Consolidated Financial Statements along with the Auditors’ Report thereon are annexed with this Report.

Subsidiaries, Joint Ventures and Associate Companies

The statement in Form AOC-1 containing salient features of financial statements of subsidiaries, associate and joint venture companies prepared in accordance with Section 129 of the Act read with Rule 5 of Companies (Accounts) Rules, 2014, forms an integral part of this Report. The Consolidated Financial Statements presented by the Company include the financial results of its subsidiaries, associate and joint venture companies.

During the financial year ended on March 31, 2021, the Company has infused additional equity capital in the following Companies at different point of times:

1. Escorts Crop Solutions Limited, Subsidiary

2. Tadano Escorts India Private Limited, Joint Venture

3. Escorts Kubota India Private Limited, Joint Venture

The Company has also entered into another Joint Venture with Kubota Corporation, Japan during the year. The Company has made an investment of '' 90 crores being 40% stake in the Equity Capital of Kubota Agricultural Machinery India Private Limited being the Joint Venture of your Company with Kubota Corporation.

The Company will make available the Annual Accounts of its subsidiaries, associate and joint venture companies and related information to the members of the Company who may be interested in obtaining the same. The annual accounts of its subsidiaries, associate and joint venture companies will also be available for inspection.

Further, the Company along with other shareholders of Escorts Securities Limited (“ESL”), the subsidiary of Escorts Limited, have entered into a Share Purchase Agreement (“SPA”) with M/s. Choice Equity Broking Private Limited (“the Acquirer’’) a wholly owned Subsidiary of M/s. Choice International Limited, to sell and transfer their entire shareholding in ESL to the Acquirer, subject to obtaining all applicable regulatory approvals. Upon completion of the aforesaid transaction in terms of the SPA, Escorts Limited will sell and transfer its entire 40.444% shareholding in ESL to the Acquirer and ESL will cease to be subsidiary of the Company.

The details of the above investments/ disinvestment are provided in the note 7 & 16 of the Notes to Accounts of Standalone Financial Statements of the Company.

Contracts and Arrangements with Related Parties

All contracts/ arrangements/ transactions entered 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 of the Company on the materiality of related party transactions.

The particulars of contracts or arrangements with related parties referred to in Section 188(1) of the Act in the prescribed Form AOC-2 is appended as Annexure - F to this report.

The Policy on materiality of related party transactions and dealing with related party transactions may be accessed on the Company’s website www.escortsgroup.com under Investors Information Section.

Your Directors draw attention of the members to note 47 in the notes to accounts in the standalone financial statement and to note 47 in the notes to accounts in the consolidated financial statement which sets out related party disclosures.

Auditors and Auditors’ Report Statutory Auditors

Pursuant to the provisions of Section 139 of the Act read with Companies (Audit and Auditors) Rules, 2014, the shareholders of the Company in the 71st AGM held on September 21, 2017 had appointed M/s Walker Chandiok & Co LLP, Chartered Accountants, New Delhi (Firm Registration No. 001076N/ N500013) as Statutory Auditors of the Company for a period of 5 years i.e. upto the conclusion of AGM to be held in the year 2022.

In accordance with the Companies (Amendment) Act, 2017 enforced on May 7, 2018 by MCA, the appointment of Statutory Auditors is not required to be ratified by members at every AGM.

The observations and comments given by M/s. Walker Chandiok & Co LLP, Chartered Accountants, Statutory Auditors in their report read together with notes to Accounts for the year ended March 31, 2021 are self-explanatory and hence, do not call for any further comments under Section 134 of the Act.

The Statutory Auditors of the Company have not reported any fraud as specified in Section 143(12) of the Act.

Cost Auditors

The Board of Directors of the Company has re-appointed M/s. Ramanath Iyer and Co., Cost Accountants, New Delhi (Firm Registration No. 000019), Cost Auditors of the Company under Section 148 of the Act, for conducting the audit of cost records for the financial year 2021-22.

The reporting on the utilisation of funds raised through preferential allotment is as follows:
Original Object	Modified Object, if any	Original Allocation	Modified allocation, if any	Funds Utilised	Amount of Deviation/ Variation for the Remarks if quarter according to any applicable object
For the Agri Machinery Business of the Company i.e. the business of manufacturing, assembly, sales, marketing, financing, servicing, research and development of: (a) tractors; (b) construction equipment (i.e., backhoe loaders and other items to be mutually agreed between Promoters and Kubota Corporation); (c) implements; (d) transmission for tractors, construction equipment (i.e., backhoe loaders and other items to be mutually agreed between the Promoters and Kubota Corporation) and implements; and (e) spare parts of the items referred in (a), (b), (c) and (d), and for the manufacture of engines by the Company	Not Applicable	'' 1041.90 crores	NIL	'' 142.30 crores	NIL -

Guarantee	The Corporate Guarantee was	Mizhuo Bank	11.025
Given	issued in favour of Mizhuo Bank Limited for an amount of '' 11.025 crores for its share of 49% in Tadano Escorts India Private Limited (TEI), a Joint Venture Company. The facility for an amount of '' 22.50 crores was availed by TEI for meeting their non-fund based requirements.	Limited
Guarantee	The Corporate Guarantee was	Tata Capital	10.00
given	issued in favour of Tata Capital	Financial
	Financial Services Limited for	Services
	credit facility of '' 7.50 crores availed by Escorts Securities Limited, a subsidiary of the Company for meeting their working capital requirements which was renewed and increased to '' 10.00 crores	Limited

Capital Reduction

During the year, the Audit Committee and Board of Directors in their meeting held on July 15, 2020 separately had approved the proposal of Capital Reduction of 1,22,57,688 Equity Shares of '' 10/- each of the Company held by Escorts Benefit and Welfare Trust without payment of any consideration.

The Shareholders of the Company approved by way of Postal Ballot on February 21, 2021 the scheme of Capital Reduction of 1,22,57,688 Equity Shares of '' 10.00 each of the Company held by Escorts Benefit and Welfare Trust subject to the confirmation by the Hon’ble National Company Law Tribunal, Chandigarh Bench (NCLT).

Post approval of the shareholders, the scheme of Capital Reduction was filed for approval of the NCLT.

Particulars of Loans given, Investments made, Guarantees given and Securities provided

Particulars of loans given, investments made, guarantees given and securities provided along with the purpose for which the loan or guarantee or security is proposed to be utilised by the recipient has been given below. The details are also provided elsewhere in the Annual Report and forms an integral part of this Report.

Details of Investments made during the year:

Name of Party	Amount ('' in crores)
Tadano Escorts India Private Limited	26.22
Escorts Crop Solutions Limited	3.55
Kubota Agricultural Machinery India Private Limited	90.00
Details of existing Guarantees and Loans given:
Nature Purpose Party Name	Amount ('' in crores)

Nature	Purpose	Party Name	Amount ('' in crores)
Loan given	An amount of '' 1 crores was given to Adico Escorts Agri Equipments Private Limited, a Joint Venture Company for meeting their business requirements at a rate of interest of 13% p.a. for a period of one year and the same was renewed for another year.	Adico Escorts Agri Equipments Private Limited	1.00

During the year, such controls were tested and no reportable material weakness in the design or operation was observed.

Disclosures Meetings of the Board

Eight meetings of the Board of Directors were held during the year. For further details, please refer Report on Corporate Governance annexed as Annexure - D to this Report.

Audit Committee

For constitution and other details of the Audit Committee, please refer Report on Corporate Governance annexed as Annexure-D to this Report.

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

Extracts of Annual Return

The extracts of the Annual Return in Form MGT-9 is available on the Company’s website at www.escortsgroup.com. The Annual Return for Financial Year 2019-20 is also available on the Company’s website at www.escortsgroup.com.

Vigil Mechanism

The Company has adopted a Whistle Blower Policy establishing vigil mechanism for Directors and Employees to report their concerns about unethical behaviour, actual or suspected fraud or violation of the Company’s Code of Conduct. The mechanism provides for adequate safeguards against victimisation of effected Director(s) and Employee(s). In exceptional cases,

Directors and Employees have direct access to the Chairman of the Audit Committee. It is affirmed that no personnel of the Company has been denied access to the Audit Committee.

The Whistle Blower Policy is available on Company’s website at https://www.escortsgroup.com/investors/ governance.html

Registrar and Share Transfer Agent

The Share Transfer and related activities are being carried out by M/s KFin Technologies Private Limited (earlier Karvy Fintech Private Limited), Registrar and Share Transfer Agent from the following address:-

M/s KFin Technologies Private Limited Tower B, Plot No. 31-32, Selenium Building,

Gachibowli, Financial District, Nanakramguda, Hyderabad-500032, Telangana

General Reserves

An amount of '' 0.21 crores (previous year: 0.33 crores) transferred to general reserves on account of vested employees stock options lapsed during the year.

Change in Share Capital Preferential Issue

During the year, the Board of Directors of the Company had approved the allotment of 1,22,57,688 Equity Shares of '' 10/-each at a premium of '' 840/- each for a total consideration of '' 1041.90 crores to M/s Kubota Corporation, Japan.

Particulars of Employees and related disclosures

In terms of provisions of Section 197(12) of the Act, read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement showing the names and other particulars of the employees drawing remuneration in excess of the prescribed limits are available with the Company Secretary. Having regard to the provisions of Section 136(1) of the Act, the Annual Report excluding the aforesaid information is being sent to the members of the Company. Any member interested in obtaining such particulars may write to the Company Secretary of the Company and the same will be furnished on request.

Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed as Annexure - H and forms an integral part of this Report.

Public Deposits

The Company has not accepted/ renewed any Fixed Deposit during the financial year and as such no amount of principal or interest was outstanding as of the Balance Sheet date.

Investor Education and Protection Fund (IEPF)

Pursuant to the applicable provisions of the Companies Act, 2013, read with IEPF Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 (‘the Rules’), all unpaid or unclaimed dividends are required to be transferred by the Company to the IEPF established by the Central Government, after the completion of seven years.

Further, according to the rules, the shares in respect of which dividend has not been paid or claimed by the shareholders for seven consecutive years or more shall also be transferred to the demat account created by the IEPF Authority. Accordingly, the Company was required to transfer the unclaimed and unpaid dividends and shares from time to time as per the requirements of the IEPF rules, details of which are provided on our website.

As on March 31, 2021, no unclaimed deposits are pending for transfer to Investor Education and Protection Fund.

Credit Rating

During the year, the credit rating of the Company is as under:

ICRA Limited has upgraded the long-term rating from “ICRA AA-“ to “ICRA “AA” with change in status from “Watch with developing implication” to “Stable” and reaffirmed Short-term rating at “ICRA A1 ”.

CRISIL has upgraded the long term rating from “CRISIL AA-“ to “CRISIL AA” with Stable outlook and reaffirmed Short-term rating at “CRISIL A1 ”.

Material Changes and Commitment affecting the financial position

There are no material changes affecting the financial position of the Company subsequent to the closure of the Fiscal 2021 till the date of this report except the impact of COVID-19, however, impact thereof is not expected to be significant.

Prevention of Sexual Harassment

The Company has zero tolerance for sexual harassment at workplace and has adopted a policy on Prevention, Prohibition and Redressal of Sexual Harassment at Workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the rules thereunder for prevention and redressal of complaints of sexual harassment at workplace. The Company is committed to provide equal opportunities without regard to their race, caste, sex, religion, colour, nationality, disability, etc. All women associates (permanent, temporary, contractual and trainees) as well as any women visiting the Company’s office premises or women service providers are covered under this Policy. All employees are treated with dignity with a view to maintain a work environment free of sexual harassment whether physical, verbal or psychological.

The Company has also 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.

Your Directors further state that 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.

Secretarial Standards

The Company is in compliance with all the applicable Secretarial Standards.

Business Responsibility Report (BRR)

The SEBI Listing Regulations mandate the inclusion of BRR as part of the Annual Report for top 1000 listed entities based on market capitalisation.

In compliance with the SEBI Listing Regulations, the BRR describing the initiatives taken by the Company from an environmental, social and governance perspective is enclosed as Annexure - I and forms an integral part of this Report.

Application made or any proceeding pending under the Insolvency and Bankruptcy Code

As on the date of the Report any application is not pending under the Insolvency and Bankruptcy Code, 2016 and the Company did not file any application under (IBC) during the Financial Year 2020-21.

Directors’ Responsibility Statement

Pursuant to the requirement under Section 134(5) of the Act, with respect to Directors’ Responsibility Statement, your Directors, to the best of their knowledge and ability, hereby confirm that:

(i) in the preparation of the annual accounts for the year ended March 31, 2021, the applicable accounting standards read with requirements set out under Schedule III to the Act, have been followed alongwith proper explanation relating to material departures;

(ii) the Directors have selected such accounting policies and applied them consistently and made judgements 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 March 31, 2021 and of the profit and loss 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 the 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 March 31, 2021 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 are operating effectively; and

(vi) the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

General

Your Directors state that no disclosure or reporting is required

in respect of the following items as there were no transactions

on these items during the year under review:

1. Details relating to deposits covered under Chapter V of the Act.

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

3. Issue of shares (including sweat equity shares) to employees of the Company under any scheme save and except ESOS referred to in this Report.

4. Neither the Managing Director nor the Whole-time Directors of the Company receive any remuneration or commission from any of its subsidiaries.

5. No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Company’s operations in future. However, members attention is drawn to note 34 in the notes to accounts in the standalone financial statement and to note 35 in the notes to accounts in the consolidated financial statement which sets out information on Commitments and Contingencies.

6. Details of difference between amount of valuation done at the time of one time settlement and the valuation done while taking loan from the Banks or Financial Institutions along with the reasons thereof: Not applicable.

Acknowledgement

Your Directors would like to express their sincere appreciation of the positive co-operation received from the Central Government, the Government of Haryana and Uttaranchal and Karnataka, Financial Institutions and the Company’s Bankers, Customers, Dealers and all other business associates.

The Directors also wish to place on record their deep sense of appreciation for the commitment displayed by all executives, officers, workers, employee unions and staff of the Company resulting in the successful performance of the Company during the year.

The Board also takes this opportunity to express its deep gratitude for the continued co-operation and support received from its valued shareholders.

For and on behalf of the Board of Directors

Place: New Delhi Nikhil Nanda

Date: May 14, 2021 Chairman & Managing Director

---

Mar 31, 2019

Dear Shareholders,

The Directors have pleasure in presenting the Seventy Third Annual Report of the Company along with Company’s audited financial statements (standalone and consolidated) for the financial year ended on March 31, 2019.

Financial Results

(Rs. crores)

Particulars	Year ended on March 31, 2019	Year ended on March 31, 2018
Gross Revenue	6,277.21	5,075.38
Excise Duty	-	20.85
Net Revenue	6,277.21	5,054.53
Profit from continuing operations before Interest, Depreciation, Exceptional Items & Tax	814.14	616.63
Finance Cost	18.48	28.57
Profit from continuing operations before Depreciation, Exceptional Items & Tax	795.66	588.06
Depreciation & Amortisation	85.37	72.48
Profit from continuing operations before Exceptional Items & Tax	710.29	515.58
Exceptional Item	10.91	(6.76)
Profit from continuing operations before Tax	721.20	508.82
Tax Expense	237.52	164.10
Profit from continuing operations after Tax	483.68	344.72
Profit / (Loss) from discontinued operations before Tax	1.89	-
Tax Expense of discontinued operations	0.66	-
Profit / (Loss) from discontinued operations after Tax	1.23	-
Net profit for the period	484.91	344.72
Appropriations for the year:
Dividends	(23.90)	(17.93)
Tax on dividends	(5.04)	(3.74)
Dividend received on share held by beneficiary trust1	6.73	5.59

* for more information please refer note 45 of the notes to accounts of standalone financial statement

Financial Performance

The brief highlights of the Company’s performance (Standalone) for the financial year ended March 31, 2019 are:-

- Net Revenue of the Company for FY 2019 of Rs. 6,277.21 crores was higher by 24.19% over the last year (Rs. 5,054.53 crores in FY 2018)

- Profit from continuing operations before Interest, Depreciation, Exceptional Items & Tax stood at Rs. 814.14 crores

- Profit from continuing operations before Tax (PBT) stood at Rs. 721.20 crores and Profit from continuing operations After Tax (PAT) stood at Rs. 483.68 crores. Net profit for the period stood at Rs. 484.91 crores

- Your Company sold 96,412 tractors during the year under review as against 80,417 tractors sold during the last financial year

Management Discussion & Analysis

In terms of the provisions of Regulation 34 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred as the “SEBI Listing Regulations”), the Management Discussion and Analysis is set out in this Annual Report and provides a detailed analysis on the performance of individual businesses and their outlook.

Dividend

Based on the Company’s performance, your Directors are pleased to recommend, for approval of the members, a Dividend of Rs. 2.50 per Equity Share (25%) on the face value of Rs. 10/- each, aggregating Rs. 22.22 crores (exclusive of tax on dividend) for the financial year ended March 31, 2019 except on the equity shares held by Escorts Benefit and Welfare Trust (EBWT). The dividend payout is subject to the approval of members at the ensuing Annual General Meeting (AGM).

The dividend payout for the period under review has been formulated in accordance with shareholders’ aspirations and the Company’s Dividend Distribution Policy to pay sustainable dividend linked to long-term growth objectives of the Company to be met by internal cash accruals.

During the year, the Dividend Distribution Policy was amended to specify the Dividend Range. The amended policy is available on our website at https://www.escortsgroup.com/templates/ escortsgroup_home/images/pdf/Dividend-Distribution-Policy.pdf

Employee Stock Option Scheme

The Scheme is in line with the SEBI (Share Based Employee Benefits) Regulations, 2014 (“SBEB Regulations”) and there have been no material changes to the schemes during the financial year 2018-19. The Scheme has been implemented in accordance with the SBEB Regulations and the resolutions passed by the members. The auditors certificate would be available at the Annual General Meeting for inspection by members. The details as required to be disclosed under the SBEB Regulations would be available on the Company’s website at www.escortsgroup.com.

Directors

During the year ended March 31, 2019, Mr. Rajan Nanda, Chairman and Managing Director of the Company passed away on August 5, 2018. The Board of Directors in their meeting held on August 7, 2018 had appointed Mr. Nikhil Nanda, Managing Director as the Chairman of the Company w.e.f. August 7, 2018.

Further, Mr. Ravi Narain, Independent Director of the Company had resigned from the Board of Directors of the Company w.e.f. May 1, 2019 in view of the order passed by SEBI in the matter of National Stock Exchange of India Limited.

In accordance with the provisions of Companies Act, 2013 (hereinafter referred as “the Act”) and Articles of Association of the Company, Ms. Nitasha Nanda, Whole-time Director and Mr. G.B. Mathur, Director retire by rotation at the ensuing AGM and being eligible, offers themselves for re-appointment.

The Company has on the recommendation of Nomination and Remuneration Committee (NRC) and in accordance with the provisions of the Act and SEBI Listing Regulations co-opted Mr. Shailendra Agrawal as an Additional Director on the Board of the Company and designated as the Executive Director w.e.f. March 22, 2019, liable to retire by rotation, subject to approval of the members at the AGM. He shall hold office as Director of the Company upto the date of ensuing AGM and is eligible for appointment as a Director. His appointment is appropriate and in the best interest of the Company.

The Board of Directors on the recommendation of NRC, in their meeting held on May 7, 2019, co-opted Mr. Sunil Kant Munjal as an Additional and Independent Director on the Board of the Company. He shall hold office as Director of the Company upto the date of ensuing AGM.

The Board of Directors on the recommendation of NRC, in their meeting held on May 7, 2019, on the basis of the report of performance evaluation, had recommended the re-appointment of Ms. Nitasha Nanda as Whole-time Director for a period of 5 years w.e.f. January 16, 2020 and Mr. D.J. Kakalia as an Independent Director for a further period of 5 years for approval of members of the Company at the ensuing AGM.

Pursuant to the applicable provisions of the Act, your directors are seeking appointment of Mr. Shailendra Agrawal as an Executive Director w.e.f. March 22, 2019 for a period of 5 years and Mr. Sunil Kant Munjal as an Independent Director for a period 5 years and re-appointment of Ms. Nitasha Nanda as Whole-time Director w.e.f. January 16, 2020 for a period of 5 years and Mr. D.J. Kakalia as an Independent Director for a period of 5 years.

The brief resumes and other disclosures relating to the Directors who are proposed to be appointed/ re-appointed, as required to be disclosed pursuant to Regulation 36 of the SEBI Listing Regulations and Clause 1.2.5 of the Secretarial Standard 2 are given in the Annexure to the Notice of the 73rd AGM.

The Company has received declarations from all the Independent Directors of the Company confirming that they meet with criteria of independence as prescribed under sub-section (6) of Section 149 of the Act and under Regulation 16(1)(b) of SEBI Listing Regulations. The policy for selection of directors and determining directors independence is attached as Annexure -A and forms an integral part of this Report.

The Company has devised a Policy for performance evaluation of Independent Directors, Board, Committees and other individual Directors which includes criteria for performance evaluation of the Non-Executive and Executive Directors. In accordance with the Policy, a process of evaluation was followed by the Board for its own performance and that of its Committees and individual Directors. The remuneration policy for directors, key managerial personnel and other employees is annexed as Annexure - B and forms an integral part of this Report.

Your Directors recommend the appointment/ re-appointment of the above said Directors at the ensuing AGM.

The Company has devised a process where various presentations/ programs are being conducted to make them familiarise with various developments at Industry level, new business initiatives and organisation strategies etc.

The details of programme for familiarisation of Independent Directors with the Company, their roles, rights, responsibilities in the Company, nature of industry in which the Company operates, business model of the Company and related matters are put up on the website of the Company - www.escortsgroup.com.

The Company recognises and embraces the importance of a diverse board in its success. We believe that a truly diverse board will leverage differences in thought, perspective, knowledge, skill, regional and industry experience, cultural and geographical background, age, ethnicity, race and gender, which will help us retain our competitive advantage.

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

The particulars relating to conservation of energy, technology absorption, foreign exchange earnings and outgo, as required to be disclosed under Section 134(3)(m) of the Act read with Companies (Accounts) Rules, 2014 are provided as Annexure - C and forms an integral part of this Report.

Corporate Governance

Corporate Governance is about maximising shareholders value, ethically and sustainable. At Escorts the goal of corporate governance is to ensure fairness for every stakeholder. We believe strong corporate governance is critical to enhancing and retaining investor trust. We also endeavor to enhance long term shareholder value and respect minority rights in all our business decisions.

Your Company reaffirms its commitment to the good corporate governance practices and has adopted the Code of Business Conduct which has set out the systems, processes and policy conforming to international standards. Pursuant to Regulation 34(3) of the SEBI Listing Regulations, Corporate Governance Report and Auditors’ Certificate regarding compliance of conditions of Corporate Governance are enclosed as Annexure - D and forms an integral part of this Report.

Corporate Social Responsibility (CSR)

The key philosophy of all CSR initiatives of the Company is to make CSR a key business process for sustainable development of the society. The initiatives aim at enhancing welfare measures of the society based on the immediate and long term social and environmental consequence of its activities.

The Company intends to undertake other need-based initiatives in compliance with Schedule VII of the Act.

The CSR Policy may be accessed on the Company’s website www.escortsgroup.com under Investors Information Section. During the year, the Company has spent Rs. 6.13 crores (2.07%) of the average net profits of last three financial years on CSR activities.

The Annual Report on CSR activities is enclosed as Annexure - E and forms an integral part of this Report.

Consolidated Financial Statements

The Consolidated Financial Statements have been prepared in accordance with the Act and Indian Accounting Standard (IND AS) - 110 applicable to the Consolidated Financial Statements read with IND AS-28 on Accounting for Investments in Associates and IND AS-31 on Financial Reporting of Interests in Joint Ventures issued by The Institute of Chartered Accountants of India. The Audited Consolidated Financial Statements along with the Auditors’ Report thereon are annexed with this Report.

Subsidiaries, Joint Ventures and Associate Companies

The statement in Form AOC-1 containing salient features of financial statements of subsidiaries, associate and joint venture companies prepared in accordance with Section 129 of the Act read with Rule 5 of Companies (Accounts) Rules, 2014, forms an integral part of this Report. The Consolidated Financial Statements presented by the Company include the financial results of its subsidiaries, associate and joint venture companies.

During the financial year ended on March 31, 2019, the Company has infused additional equity capital in Escorts Crop Solutions Limited, subsidiary of the Company. The details of the said investment/ disinvestment is provided in the note 6(i) of the Notes to Accounts of the Standalone Financial Statements of the Company.

The Company has also entered into two Joint Ventures with Japanese companies during the year i.e. with Tadano Limited and Kubota Corporation. The Company has also made an investment of Rs. 29.40 crores being 49% stake in the Equity Capital of Tadano Escorts India Private Limited being the Joint Venture of your Company with Tadano Limited, Japan and Rs. 60 crores being 40% stake in the Equity Capital of Escorts Kubota India Private Limited being the Joint Venture of your Company with Kubota Corporation, Japan.

The Company will make available the Annual Accounts of its subsidiaries, associate and joint venture companies and related information to the members of the Company who may be interested in obtaining the same. The annual accounts of its subsidiaries, associate and joint venture companies will also be kept open for inspection at the Registered Office of the Company.

Contracts and Arrangements with Related Parties

All contracts/ arrangements/ transactions entered 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 of the Company on the materiality of related party transactions.

The particulars of contracts or arrangement with related parties referred to in Section 188(1) of the Act in the prescribed Form AOC-2 is appended as Annexure - F to this report.

The Policy on materiality of related party transactions and dealing with related party transactions may be accessed on the Company’s website www.escortsgroup.com under Investors Information Section.

Your Directors draw attention of the members to Note 47 in the notes to accounts in the standalone financial statement and to Note 46 in the notes to accounts in the consolidated financial statement which sets out related party disclosures.

Auditors and Auditors’ Report

Statutory Auditors

Pursuant to the provisions of Section 139 of the Act read with Companies (Audit and Auditors) Rules, 2014, the shareholders of the Company in the 71st AGM held on September 21, 2017 had appointed M/s Walker Chandiok & Co LLP, Chartered Accountants, New Delhi (Firm Registration No. 001076N/ N500013) as Statutory Auditors of the Company for a period of 5 years i.e. upto the conclusion of AGM to be held in the year 2022.

In accordance with the Companies (Amendment) Act, 2017 enforced on May 7, 2018 by MCA, the appointment of Statutory Auditors is not required to be ratified by members at every AGM. The observations and comments given by M/s. Walker Chandiok & Co LLP, Chartered Accountants, Statutory Auditors in their report read together with notes to Accounts for the year ended March 31, 2019 are self-explanatory and hence, do not call for any further comments under Section 134 of the Act. The Statutory Auditors of the Company have not reported any fraud as specified in Section 143(12) of the Act.

Cost Auditors

The Board of Directors of the Company has re-appointed M/s. Ramanath Iyer and Co., Cost Accountants, New Delhi (Firm Registration No. 000019), Cost Auditors of the Company under Section 148 of the Act, for conducting the audit of cost records for the financial year 2019-20.

The due date of filing the Cost Audit Report for the year ended on March 31, 2018 was September 30, 2018 and the same had been filed on September 13, 2018.

Secretarial Auditors

The Board of Directors of the Company had appointed M/s. Jayant Gupta and Associates, Practicing Company Secretary to conduct secretarial audit of the Company for the financial year 2018-19.

The Secretarial Audit Report for the financial year ended March 31, 2019 is enclosed as Annexure - G and forms an integral part of this Report.

The observations and comments given by the Secretarial Auditors in their report are self-explanatory and hence, do not call for any further comments under Section 204(3) of the Act.

The Board has also re-appointed M/s. Jayant Gupta and Associates, Practicing Company Secretary to conduct secretarial audit of the Company for the financial year 2019-20.

Risk Management

The Risk Management Committee of the Board has been entrusted with the responsibility to assist the Board in (a) overseeing and approving the Company’s enterprise wide risk management framework; and (b) Overseeing that all the risks that the organisation faces such as strategic, financial, credit, market, liquidity, security, property, IT, legal, regulatory, reputational and other risks have been identified and assessed and there is an adequate risk management infrastructure in place capable of addressing those risks.

Internal Financial Control and its Adequacy

The Board has adopted policies and procedures for ensuring the orderly and efficient conduct of its business, including adherence to Company’s policies, the safeguarding of its assets, the prevention and detection of fraud, error reporting mechanisms, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial disclosures.

The Company has in place adequate internal financial controls for ensuring the orderly and efficient conduct of its business. During the year, such controls were tested and no reportable material weakness in the design or operation was observed.

Disclosures

Meetings of the Board

Ten meetings of the Board of Directors were held during the year. For further details, please refer Report on Corporate Governance annexed as Annexure - D to this Report.

Audit Committee

For constitution and other details of the Audit Committee, please refer Report on Corporate Governance annexed as Annexure-D to this Report.

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

Extracts of Annual Return

In terms of provisions of Section 92 of the Act read with the Companies (Management and Administration) Rules, 2014, the extracts of Annual Return in Form MGT-9 is enclosed as Annexure - H and forms an integral part of this Report. The Annual Return for Financial Year 2017-18 is also available on the Company’s website at www.escortsgroup.com.

Vigil Mechanism

The Company has adopted a Whistle Blower Policy establishing vigil mechanism for Directors and Employees to report their concerns about unethical behavior, actual or suspected fraud or violation of the Company’s Code of Conduct. The mechanism provides for adequate safeguards against victimisation of effected Director(s) and Employee(s). In exceptional cases, Directors and Employees have direct access to the Chairman of the Audit Committee. It is affirmed that no personnel of the Company has been denied access to the Audit Committee. The Whistle Blower Policy is available on Company’s website.

Registrar and Share Transfer Agent

The Share Transfer and related activities are being carried out by M/s Karvy Fintech Private Limited (earlier Karvy Computershare Private Limited), Registrar and Share Transfer Agents from the following address:-

M/s Karvy Fintech Private Limited

Karvy Selenium, Tower B, Plot No. 31-32,

Gachibowli, Financial District, Nanakramguda,

Hyderabad-500032, Telangana

All correspondence may kindly be sent to the above address only.

Particulars of Loans given, Investments made, Guarantees given and Securities provided

Particulars of loans given, investments made, guarantees given and securities provided along with the purpose for which the loan or guarantee or security is proposed to be utilised by the recipient has been given elsewhere in the Annual Report and forms an integral part of this Report.

Particulars of Employees and related disclosures

In terms of provisions of Section 197(12) of the Act, read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement showing the names and other particulars of the employees drawing remuneration in excess of the prescribed limits are available with the Company Secretary. Having regard to the provisions of Section 136(1) of the Act, the Annual Report excluding the aforesaid information is being sent to the members of the Company. Any member interested in obtaining such particulars may write to the Company Secretary of the Company and the same will be furnished on request.

Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed as Annexure - I and forms an integral part of this Report.

Public Deposits

The Company has not accepted/ renewed any Fixed Deposit during the financial year and as such no amount of principal or interest was outstanding as of the Balance Sheet date.

Investor Education and Protection Fund (IEPF)

Pursuant to the applicable provisions of the Companies Act, 2013, read with IEPF Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 (‘the Rules’), all unpaid or unclaimed dividends are required to be transferred by the Company to the IEPF established by the Central Government, after the completion of seven years.

Further, according to the rules, the shares in respect of which dividend has not been paid or claimed by the shareholders for seven consecutive years or more shall also be transferred to the demat account created by the IEPF Authority. Accordingly, the Company was required to transfer the unclaimed and unpaid dividends and shares as per the requirements of the IEPF rules, details of which are provided on our website.

As on March 31, 2019, no unclaimed deposits are pending for transfer to Investor Education and Protection Fund.

Credit Rating

During the year, the credit rating of the Company have been upgraded as under:

ICRA Limited has upgraded the long-term rating from “ICRA A ”/ Positive to “ICRA AA-”/ Stable and short-term rating reaffirmed “ICRA A1 ”.

India Ratings has upgraded the long-term rating from ‘IND A / Positive to ‘IND AA-/ Positive and short-term rating reaffirmed “IND A1 ”.

CRISIL has assigned long term rating “CRISIL AA-”/ Stable and short term rating “CRISIL A1 ”.

Material Changes and Commitment affecting the financial position

There are no material changes affecting the financial position of the Company subsequent to the close of the Fiscal 2019 till the date of this report.

Prevention of Sexual Harassment

The Company has zero tolerance for sexual harassment at workplace and has adopted a policy on Prevention, Prohibition and Redressal of Sexual Harassment at Workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules thereunder for prevention and redressal of complaints of sexual harassment at workplace. The Company is committed to providing equal opportunities without regard to their race, caste, sex, religion, colour, nationality, disability, etc. All women associates (permanent, temporary, contractual and trainees) as well as any women visiting the Company’s office premises or women service providers are covered under this Policy. All employees are treated with dignity with a view to maintain a work environment free of sexual harassment whether physical, verbal or psychological.

The Company has also 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.

Your Directors further state that 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.

Secretarial Standards

The Company is in compliance with all the applicable Secretarial Standards.

Business Responsibility Report (BRR)

The SEBI Listing Regulations mandate the inclusion of BRR as part of the Annual Report for top 500 listed entities based on market capitalisation.

In compliance with the SEBI Listing Regulations, the BRR describing the initiatives taken by the Company from an environmental, social and governance perspective is enclosed as Annexure - J and forms an integral part of this Report.

Directors’ Responsibility Statement

Pursuant to the requirement under Section 134(5) of the Act, with respect to Directors’ Responsibility Statement, your Directors, to the best of their knowledge and ability, hereby confirm that:

(i) in the preparation of the annual accounts for the year ended March 31, 2019, the applicable accounting standards read with requirements set out under Schedule III to the Act, have been followed alongwith proper explanation relating to material departures;

(ii) the Directors have selected such accounting policies and applied them consistently and made judgements 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 March 31, 2019 and of the profit and loss 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 the 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 March 31, 2019 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 are operating effectively; and

(vi) the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

General

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

1. Details relating to deposits covered under Chapter V of the Act.

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

3. Issue of shares (including sweat equity shares) to employees of the Company under any scheme save and except ESOS referred to in this Report.

4. Neither the Managing Director nor the Whole-time Directors of the Company receive any remuneration or commission from any of its subsidiaries.

5. No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Company’s operations in future. However, members attention is drawn to note 34 on Commitments and Contingencies in the Notes forming part of the financial statement.

Acknowledgement

Your Directors would like to express their sincere appreciation of the positive co-operation received from the Central Government, the Government of Haryana and Uttaranchal and Karnataka, Financial Institutions and the Company’s Bankers, Customers, Dealers and all other business associates.

The Directors also wish to place on record their deep sense of appreciation for the commitment displayed by all executives, officers, workers, employee unions and staff of the Company resulting in the successful performance of the Company during the year.

The Board also takes this opportunity to express its deep gratitude for the continued co-operation and support received from its valued shareholders.

For and on behalf of the Board of Directors

Sd/-

Place: Faridabad Nikhil Nanda

Date: May 7, 2019 Chairman & Managing Director

---

Mar 31, 2018

Dear Shareholders,

The Directors have pleasure in presenting the Seventy Second Annual Report of the Company along with Company’s audited financial statements (standalone and consolidated) for the financial year ended on March 31, 2018.

Financial Results

(Rs. crores)

Particulars	Year ended on March 31, 2018	Year ended on March 31, 2017
Gross Revenue	5,075.38	4,211.04
Excise Duty	20.85	74.42
Net Revenue	5,054.53	4,136.62
Profit fiom continuing operations befoie Interest, Depieciation. Exceptional Items & Tax Finance Cost Profit from continuing operations before Depreciation, Exceptional Items & Tax	616.63 28.57 588.06	367.17 31.11 336.06
Depreciation & Amortisation	72.48	63.07
Profit from continuing operations before Exceptional Items & Tax	515.58	272.99
Exceptional Item	6.76	(3.76)
Profit from continuing operations before Tax	508.82	276.75
Tax Expense	164.10	75.60
Profit from continuing operations after Tax	344.72	201.15
Profit / (Loss) from discontinued operations before Tax	-	(58.46)
Tax Expense of discontinued operations	-	(17.75)
Profit / (Loss) from discontinued operations after Tax	-	(40.71)
Profit for the year	344.72	160.44
Appropriations for the year:
Dividend on Equity Shares (excluding Tax) Tax on dividends Dividend received on share held by beneficiary trust1	(17.93) (3.74) 5.59	(14.35) (2.99) 4.48

* for more information please refer note 45 of the notes to accounts of standalone financial statement

Financial Performance

The brief highlights of the Company’s performance (Standalone) for the fi nancial year ended March 31, 2018* are:-

Net Revenue of the Company for FY 2018 of Rs.5054.53 crores was higher by 22.19% over the last year (Rs.4,136.62 crores in FY 2017)

- Profit from continuing operations Before Interest, Depreciation, Amortisation, Exceptional Items & Tax stood at Rs.616.63 crores

- Profit from continuing operations Before Tax (PBT) stood at Rs.508.82 crores and Profit from continuing operations After Tax (PAT) stood at Rs.344.72 crores Net profit for the period stood at Rs.344.72 crores.

- Your Company sold 80,417 tractors during the year under review.

Management Discussion & Analysis

In terms of the provisions of Regulation 34 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred as the “SEBI Listing Regulations’ ), the Management Discussion and Analysis is set out in this Annual Report and provides a detailed analysis on the performance of individual businesses and their outlook.

Dividend

Based on the Company’s performance, your Directors are pleased to recommend, for approval of the members, a Dividend of Rs.2.00 per Equity Share (20%) on the face value of Rs.10/- each, aggregating Rs.24.52 crores (exclusive of tax on dividend) for the financial year ended March 31, 2018. The dividend payout is subject to the approval of members at the ensuing Annual General Meeting (AGM).

The dividend payout for the period under review has been formulated in accordance with shareholders’ aspirations and the Company’s Dividend Distribution Policy to pay sustainable dividend linked to long-term growth objectives of the Company to be met by internal cash accruals.

Employee Stock Option Scheme

The particulars with regard to the Employees Stock Options as on March 31, 2018 as required to be disclosed pursuant to the provisions of Clause 12 of SEBI (Employees Stock Option Scheme and Employees Stock Purchase Scheme) Guidelines, 1999, as amended, are enclosed at Annexure - A and forms an integral part of this Report.

Directors

In accordance with the provisions of Companies Act, 2013 (hereinafter referred as “the Act”) and Articles of Association of the Company, Mr. Hardeep Singh, Director and Mr. G.B. Mathur, Director retires by rotation at the ensuing AGM and being eligible, offers themselves for re-appointment.

The Company has on the recommendation of Nomination and Remuneration Committee and in accordance with the provisions of the Act and SEBI Listing Regulations co-opted Mr. Ravi Narain as an Additional and Independent Director on the Board of the Company with effect from September 21, 2017 subject to approval of the members at the AGM. He shall hold office as Director of the Company upto the date of ensuing AGM and is eligible for appointment as a Director.

The Board of Directors, in their meeting held on May 17, 2018, had recommended the re-appointment of Dr. Sutanu Behuria as an Independent Director for a further period of 5 years for approval of members of the Company at the ensuing AGM.

Pursuant to the provisions of Section1 49 and other applicable provisions of the Act, your directors are seeking appointment of Mr. Ravi Narain as an Independent Director for a period of 3 years and re-appointment of Dr. Sutanu Behuria as an Independent Director for a period of 5 years.

The Company has received declarations from all the Independent Directors of the Company confirming that they meet with criteria of independence as prescribed under sub-section (6) of Section 149 of the Act and under Regulation 16(1)(b) of SEBI Listing Regulations. The policy for selection of directors and determining directors independence is attached as Annexure - B and forms an integral part of this Report.

The Company has devised a Policy for performance evaluation of Independent Directors, Board, Committees and other individual Directors which includes criteria for performance evaluation of the Non-Executive and Executive Directors. In accordance with the Policy, a process of evaluation was followed by the Board for its own performance and that of its Committees and individual Directors. The remuneration policy for directors, key managerial personnel and other employees is annexed as Annexure - C and forms an integral part of this Report.

The brief resumes and other disclosures relating to the Directors who are proposed to be appointed/ re-appointed, as required to be disclosed pursuant to Regulation 36 of the SEBI Listing Regulations and Clause 1.2.5 of the Secretarial Standard 2 are given in the Annexure to the Notice of the 72nd AGM.

Your Directors recommend the appointment/ re-appointment of the above said Directors at the ensuing AGM.

The Company has devised a process where various presentations/ programs are being conducted to make them familiarise with various developments at Industry level, new business initiatives and organisation strategies etc.

The details of programme for familiarisation of Independent Directors with the Company, their roles, rights, responsibilities in the Company, nature of industry in which the Company operates, business model of the Company and related matters are put up on the website of the Company - www.escortsgroup.com.

The Company recognises and embraces the importance of a diverse board in its success. We believe that a truly diverse board will leverage differences in thought, perspective, knowledge, skill, regional and industry experience, cultural and geographical background, age, ethnicity, race and gender, which will help us retain our competitive advantage.

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

The particulars relating to conservation of energy, technology absorption, foreign exchange earnings and outgo, as required to be disclosed under Section 134(3)(m) of the Act read with Companies (Accounts) Rules, 2014 are provided as Annexure - D and forms an integral part of this Report.

Corporate Governance

Corporate Governance is about maximising shareholders value, ethically and sustainable. At Escorts the goal of corporate governance is to ensure fairness for every stakeholder. We believe strong corporate governance is critical to enhancing and retaining investor trust. We also endeavor to enhance long term shareholder value and respect minority rights in all our business decisions.

Your Company reaffirms its commitment to the good corporate governance practices and has adopted the Code of Conduct which has set out the systems, processes and policy conforming to international standards. Pursuant to Regulation 34(3) of the SEBI Listing Regulations, Corporate Governance Report and Auditors’ Certificate regarding compliance of conditions of Corporate Governance are enclosed as Annexure - E and forms an integral part of this Report.

Corporate Social Responsibility (CSR)

The key philosophy of all CSR initiatives of the Company is to make CSR a key business process for sustainable development of the society. The initiatives aim at enhancing welfare measures of the society based on the immediate and long term social and environmental consequence of its activities.

The Company intends to undertake other need based initiatives in compliance with Schedule VII of the Act.

The CSR Policy may be accessed on the Company’s website www. escortsgroup.com under Investors Information Section. During the year, the Company has spent Rs.3.25 crores (2.11%) of the average net profits of last three financial years on CSR activities.

The Annual Report on CSR activities is enclosed as Annexure - F and forms an integral part of this Report.

Indian Accounting Standards

The Ministry of Corporate Affairs (MCA) on February 16, 2015, notified that Indian Accounting Standards (Ind AS) are applicable to certain classes of companies from April 1, 2016 with a transition date of April 1, 2015. Ind AS has replaced the previous Indian GAAP prescribed under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. Ind AS is applicable to the Company from April 1, 2016.

Consolidated Financial Statements

The Consolidated Financial Statements have been prepared in accordance with the Act and Indian Accounting Standard (IND AS) - 1 1 0 applicable to the Consolidated Financial Statements read with IND AS-28 on Accounting for Investments in Associates and IND AS-31 on Financial Reporting of Interests in Joint Ventures issued by The Institute of Chartered Accountants of India. The Audited Consolidated Financial Statements along with the Auditors’ Report thereon are annexed with this Report.

Subsidiaries, Joint Ventures and Associate Companies

The statement in Form AOC-1 containing salient features of financial statements of subsidiaries, associate and joint venture companies prepared in accordance with Section 129 of the Act read with Rule 5 of Companies (Accounts) Rules, 2014, forms an integral part of this Report. The Consolidated Financial Statements presented by the Company include the financial results of its subsidiaries, associate and joint venture companies.

During the financial year ended on March 31, 2018, the Company has infused additional equity in Escorts Securities Limited and Escorts Crop Solutions Limited, subsidiaries of the Company. The Company has divested its investment in Escorts Asset Management Limited, the Board Controlled Subsidiary of the Company. The details of the said investment/ disinvestment is provided in the note 6(i) of the Notes to Accounts of the Standalone Financial Statements of the Company.

The Company will make available the Annual Accounts of its subsidiaries, associate and joint venture companies and related information to the members of the Company who may be interested in obtaining the same. The annual accounts of its subsidiaries, associate and joint venture companies will also be kept open for inspection at the Registered Office of the Company.

Contracts and Arrangements with Related Parties

All contracts/ arrangements/ transactions entered 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 of the Company on the materiality of related party transactions.

The particulars of contracts or arrangement with related parties referred to in Section 188(1) of the Act in the prescribed Form AOC-2 is appended as Annexure - G to this report.

The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board may be accessed on the Company’s website www.escortsgroup.com under Investors Information Section.

Your Directors draw attention of the members to Note 47 in the notes to accounts in the standalone financial statement and to Note 46 in the notes to accounts in the consolidated financial statement which sets out related party disclosures.

Auditors and Auditors’ Report Statutory Auditors

Pursuant to the provisions of Section 1 39 of the Act read with Companies (Audit and Auditors) Rules, 2014, the shareholders of the Company in the 71st AGM held on September 21, 2017 had appointed M/s Walker Chandiok & Co LLP, Chartered Accountants, New Delhi (Firm Registration No. 001076N/ N500013) as Statutory Auditors of the Company for a period of 5 years i.e. upto the conclusion of AGM to be held in the year 2022. The first year of audit was of the fi nancial statements for the year ending March 31, 2018, which included the audit of the quarterly financial statements for the year.

In accordance with the Companies (Amendment) Act, 2017 enforced on May 7, 2018 by MCA, the appointment of Statutory Auditors is not required to be ratified by members at every AGM.

The observations and comments given by M/s. Walker Chandiok & Co LLP, Chartered Accountants, Statutory Auditors in their report read together with notes to Accounts for the year ended March 31, 2018 are self-explanatory and hence, do not call for any further comments under Section 134 of the Act.

Cost Auditors

The Board of Directors of the Company has re-appointed M/s. Ramanath Iyer and Co., Cost Accountants, New Delhi (Firm Registration No. 000019), Cost Auditors of the Company under Section 148 of the Act, for conducting the audit of cost records for the fi nancial year 2018-19.

The due date of filing the Cost Audit Report for the year ended on March 31, 2017 was September 30, 2017 and the same has been filed on September 29, 2017.

Secretarial Auditors

The Board of Directors of the Company had appointed M/s. Jayant Gupta and Associates, Practicing Company Secretary to conduct secretarial audit of the Company for the financial year 2017-18.

The Secretarial Audit Report for the financial year ended March 31, 2018 is enclosed as Annexure - H and forms an integral part of this Report.

The observations and comments given by the Secretarial Auditors in their report are self-explanatory and hence, do not call for any further comments under Section 204(3) of the Act.

The Board has also re-appointed M/s. Jayant Gupta and Associates, Practicing Company Secretary to conduct secretarial audit of the Company for the financial year 2018-19.

Risk Management

The Risk Management Committee of the Board has been entrusted with the responsibility to assist the Board in (a) overseeing and approving the Company’s enterprise wide risk management framework; and (b) Overseeing that all the risks that the organisation faces such as strategic, financial, credit, market, liquidity, security, property, IT, legal, regulatory, reputational and other risks have been identified and assessed and there is an adequate risk management infrastructure in place capable of addressing those risks.

Internal Financial Control and its Adequacy

The Board has adopted policies and procedures for ensuring the orderly and efficient conduct of its business, including adherence to Company’s policies, the safeguarding of its assets, the prevention and detection of fraud, error reporting mechanisms, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial disclosures.

The Company has in place adequate internal financial controls for ensuring the orderly and efficient conduct of its business. During the year, such controls were tested and no reportable material weakness in the design or operation was observed.

Disclosures Meetings of the Board

Seven meetings of the Board of Directors were held during the year. For further details, please refer Report on Corporate Governance annexed as Annexure - E to this Report.

Audit Committee

For constitution and other details of the Audit Committee, please refer Report on Corporate Governance annexed as Annexure-E to this Report.

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

Extracts of Annual Return

In terms of provisions of Section 92 of the Act read with the Companies (Management and Administration) Rules, 2014, the extracts of Annual Return in Form MGT-9 is enclosed as Annexure - I and forms an integral part of this Report.

Vigil Mechanism

The Company has adopted a Whistle Blower Policy establishing vigil mechanism for Directors and Employees to report their concerns about unethical behavior, actual or suspected fraud or violation of the Company’s Code of Conduct. The mechanism provides for adequate safeguards against victimization of effected Director(s| and Employee(s). In exceptional cases, Directors and Employees have direct access to the Chairman of the Audit Committee. It is affirmed that no personnel of the Company has been denied access to the Audit Committee. The Whistle Blower Policy is available on Company’s website.

Registrar and Share Transfer Agent

The Share Transfer and related activities are being carried out by M/s Karvy Computershare Private Limited, Registrar and Share Transfer Agents from the following address:-

M/s Karvy Computershare Private Limited Karvy Selenium, Tower B, Plot No. 31-32,

Gachibowli, Financial District, Nanakramguda, Hyderabad-500032, Telangana

All correspondence may kindly be sent to the above address only.

General Reserve

Rs.217.09 crores have been credited/ appropriated in General Reserves for the amount received by the Company as Beneficiary of Escorts Benefit and Welfare Trust on account of sale of treasury stock.

Particulars of Loans given, Investments made, Guarantees given and Securities provided

Particulars of loans given, investments made, guarantees given and securities provided along with the purpose for which the loan or guarantee or security is proposed to be utilised by the recipient has been given elsewhere in the Annual Report and forms an integral part of this Report.

Particulars of Employees and related disclosures

In terms of provisions of Section 197(12) of the Act, read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement showing the names and other particulars of the employees drawing remuneration in excess of the prescribed limits are available with the Company Secretary. Having regard to the provisions of Section 136(1) of the Act, the Annual Report excluding the aforesaid information is being sent to the members of the Company. Any member interested in obtaining such particulars may write to the Company Secretary of the Company and the same will be furnished on request.

Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed as Annexure - J and forms an integral part of this Report.

Public Deposits

The Company has not accepted/ renewed any Fixed Deposit during the financial year and as such no amount of principal or interest was outstanding as of the Balance Sheet date.

Investor Education and Protection Fund (IEPF)

Pursuant to the applicable provisions of the Companies Act, 2013, read with IEPF Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 (‘the Rules’), all unpaid or unclaimed dividends are required to be transferred by the company to the IEPF established by the Central Government, after the completion of seven years. Further, according to the rules, the shares in respect of which dividend has not been paid or claimed by the shareholders for seven consecutive years or more shall also be transferred to the demat account created by the IEPF Authority. Accordingly, the Company has transferred the unclaimed and unpaid dividends and shares as per the requirements of the IEPF rules, details of which are provided on our website.

As on March 31, 2018, no unclaimed deposits are pending for transfer to Investor Education and Protection Fund.

Credit Rating

During the year, the credit rating of the Company have been upgraded as under:

ICRA Limited has upgraded the long-term rating from “A” to “A ” and short-term rating from “A1” to “A1 ” with Positive outlook.

India Ratings has upgraded the long-term rating from ‘IND A’ to ‘IND A ’ and short-term rating from “A1” to “A1 ” with upward change in outlook from “STABLE” to “POSITIVE”

Material Changes and Commitment affecting the financial position

There are no material changes affecting the financial position of the Company subsequent to the close of the Fiscal 2018 till the date of this report.

Prevention of Sexual Harassment

The Company has zero tolerance for sexual harassment at workplace and has adopted a policy on Prevention, Prohibition and Redressal of Sexual Harassment at Workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules thereunder for prevention and redressal of complaints of sexual harassment at workplace. The Company is committed to providing equal opportunities without regard to their race, caste, sex, religion, colour, nationality, disability, etc. All women associates (permanent, temporary, contractual and trainees) as well as any women visiting the Company’s office premises or women service providers are covered under this Policy. All employees are treated with dignity with a view to maintain a work environment free of sexual harassment whether physical, verbal or psychological.

Your Directors further state that 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.

Secretarial Standards

The Company is in compliance with all the applicable Secretarial Standards.

Business Responsibility Report (BRR)

The SEBI Listing Regulations mandate the inclusion of BRR as part of the Annual Report for top 500 listed entities based on market capitalization.

In compliance with the SEBI Listing Regulations, the BRR describing the initiatives taken by the Company from an environmental, social and governance perspective is enclosed as Annexure - K and forms an integral part of this Report.

Directors’ Responsibility Statement

Pursuant to the requirement under Section 134(5) of the Act, with respect to Directors’ Responsibility Statement, your Directors, to the best of their knowledge and ability, hereby confirm that:

(i) in the preparation of the annual accounts for the year ended March 31, 2018, the applicable accounting standards read with requirements set out under Schedule III to the Act, have been followed alongwith proper explanation relating to material departures;

(ii) the Directors have selected such accounting policies and applied them consistently and made judgements 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 March 31, 2018 and of the profit and loss 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 the 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 March 31, 2018 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 are operating effectively; and

(vi) the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

General

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

1 . Details relating to deposits covered under Chapter V of the Act.

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

3. Issue of shares (including sweat equity shares) to employees of the Company under any scheme save and except ESOS referred to in this Report.

4. Neither the Managing Director nor the Whole-ti me Directors of the Company receive any remuneration or commission from any of its subsidiaries.

5. No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Company’s operations in future. However, members attention is drawn to note 34 on Commitments and Contingencies in the Notes forming part of the financial statement.

Acknowledgement

Your Directors would like to express their sincere appreciation of the positive co-operation received from the Central Government, the Government of Haryana and Uttaranchal and Karnataka, Financial Institutions and the Company’s Bankers, Customers, Dealers and all other business associates.

The Directors also wish to place on record their deep sense of appreciation for the commitment displayed by all executives, officers, workers, employee unions and staff of the Company resulting in the successful performance of the Company during the year.

The Board also takes this opportunity to express its deep gratitude for the continued co-operation and support received from its valued shareholders.

For and on behalf of the Board of Directors

Sd/-

Place: Faridabad RAJAN NANDA

Date: May 17, 2018 Chairman & Managing Director

---

Mar 31, 2017

The Directors have pleasure in presenting the Seventy First Annual Report and the Company’s audited financial statements (standalone and consolidated) for the financial year ended on March 31, 2017.

Financial Results

Particulars	Year ended on March 31, 2017	Year ended on March 31, 2016
Gross Revenue	4,211.04	3,494.49
Excise Duty	74.42	71.91
Net Revenue	4,136.62	3,422.58
Profit from continuing operations before Interest, Depreciation, Exceptional terns & Tax	367.17	232.55
Finance Cost	31.11	49.54
Profit from continuing operations before Depreciation, Exceptional Items & Tax.	336.06	183.01
Depreciation & Amortisation	63.07	57.50
Profit from continuing operations before Exceptional Items b Tax	272.99	125.51
Exceptional Item	(3.76)	12.29
Profit from continuing operations before Tax	276.75	113.22
Tax. Expense	75.60	12.50
Profit from continuing operations after Tax.	201.15	100.72
Profit/(Loss) from discontinued operations before tax	(58.46)	(25.96)
Tax. expense of discontinued operations	(17.75)	(8.99)
Net profit/(loss) from discontinued operations after tax	(40.71)	(16.97)
Net profit for the period	160.44	83.75
Appropriations for the year:-
Di vi cl ends	(14.35)	(14.30)
Tax. on Dividends	(2.99)	(2.99)
Dividend received on shares held by beneficiary trust*	4.48	4.48

* for more information please refer note 45 of the notes to accounts of standalone financial statement

Financial Performance

The brief highlights of the Company’s performance (standalone) for the financial year ended March 31, 2017 are:-

- Net Revenue of the Company for FY 2017 of Rs.4,136.62 cr. was higher by 20.86% over the last year (Rs.3,422.58 cr. in FY 2016).

- Profit from continuing operations Before Interest, Depreciation, Amortisation, Exceptional Items & Tax stood at Rs.367.17 Cr.

- Profit from continuing operations Before Tax (PBT) stood at Rs.276.75 Cr and Profit from continuing operations After Tax (PAT) stood at Rs.201.15 Cr. Net profit for the period stood at Rs.160.44 Cr.

- Earnings per share is of Rs.13.43 for the year under review.

- Your Company sold 63,786 tractors during the year under review.

Management Discussion & Analysis

Management Discussion & Analysis which forms an integral part of this Annual Report provides a detailed analysis on the performance of individual businesses and their outlook.

Dividend

Your Directors are pleased to recommend a Dividend of Rs.1.50 per Equity Share (15%) on the face value of Rs.10/- each, aggregating Rs.18.39 Cr. (exclusive of tax on dividend) for the financial year ended March 31, 2017. The dividend payout is subject to the approval of members at the ensuing Annual General Meeting (AGM).

The dividend, if approved at the ensuing AGM, will be paid to members whose names appear in the Register of Members as on September 8, 2017, in respect of shares held in dematerialized form and members whose names are furnished by National Securities Depository Limited and Central Depository Services (India) Limited, as beneficial owners as at that date.

The dividend payout for the period under review has been formulated in accordance with shareholders’ aspirations and the Company’s Dividend Distribution Policy to pay sustainable dividend linked to long-term growth objectives of the Company to be met by internal cash accruals.

Employee Stock Option Scheme

The particulars with regard to the Employees Stock Options as on March 31, 2017 as required to be disclosed pursuant to the provisions of Clause 12 of SEBI (Employees Stock Option Scheme and Employees Stock Purchase Scheme) Guidelines, 1999, as amended, are enclosed at Annexure -A and forms an integral part of this Report.

Directors

In accordance with the provisions of Companies Act, 2013 (hereinafter referred as “the Act”) and Articles of Association of the Company, Ms. Nitasha Nanda, Whole-time Director and Mr. G.B. Mathur, Director retires by rotation at the ensuing AGM and being eligible, offers themselves for reappointment.

The Board of Directors, in their meeting held on May 29, 2017, had recommended the re-appointment and remuneration of Mr. Nikhil Nanda as Managing Director for a further period of 5 years w.e.f September 19, 2017, subject to the approval of the shareholders in the ensuing Annual General Meeting. His appointment is appropriate and in the best interest of the Company.

Dr. S.A. Dave had resigned as Director of the Company w.e.f. September 20, 2016. The Board places on record its warm appreciation for the valuable guidance and services rendered by Dr. Dave during his tenure with the Company.

The Board of Directors, in their meeting held on May 29, 2017, had recommended the re-appointment of Mr. PH. Ravikumar and Mrs. Vibha Paul Rishi as Independent Directors for a further period of 5 years for approval of members of the Company at the ensuing AGM.

Pursuant to the provisions of Section 149 and other applicable provisions of the Act, your directors are seeking re-appointment of Mr. PH. Ravikumar and Mrs. Vibha Paul Rishi as Independent Directors for a period of 5 years.

The Company has received declarations from all the Independent Directors of the Company confirming that they meet with criteria of independence as prescribed under sub-section (6) of Section 149 of the Act and under Regulation 16(l)(b) of SEBI (Listing Obligations and Disclosures Requirements) Regulation, 2015 (hereinafter referred as “the Listing Regulations”). The policy for selection of directors and determining directors independence is attached as Annexure - B and forms an integral part of this Report.

The Company has devised a Policy for performance evaluation of Independent Directors, Board, Committees and other individual Directors which includes criteria for performance evaluation of the Non-Executive and Executive Directors. In accordance with the Policy, a process of evaluation was followed by the Board for its own performance and that of its Committees and individual Directors. The remuneration policy for directors, key managerial personnel and other employees is annexed as Annexure - C and forms an integral part of this Report.

The brief resumes and other details relating to the Directors who are proposed to be appointed/ re-appointed, as required to be disclosed under the Listing Regulations is given in the Annexure to the Notice of the 71st AGM.

Your Directors recommend the appointment/ reappointment of the above said Directors at the ensuing AGM.

The Company has devised a process where various presentations/ programs are being conducted to make them familiarise with various developments at Industry level, new business initiatives and organisation strategies etc.

The details of programme for familiarisation of Independent Directors with the Company, their roles, rights, responsibilities in the Company, nature of industry in which the Company operates, business model of the Company and related matters are put up on the website of the Company - www. escortsg rou p. com.

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

The particulars relating to conservation of energy, technology absorption, foreign exchange earnings and outgo, as required to be disclosed under Section 134(3)(m) of the Act read with Companies (Accounts) Rules, 2014 are provided as Annexure - D and forms an integral part of this Report.

Corporate Governance

Your Company reaffirms its commitment to the good corporate governance practices and has adopted the Code of Conduct which has set out the systems, processes and policy conforming to international standards. Pursuant to Regulation 34(3) of the Listing Regulations 2015, Corporate Governance Report and Auditors’ Certificate regarding compliance of conditions of Corporate Governance are enclosed as Annexure - E and forms an integral part of this Report.

Corporate Social Responsibility (CSR)

The key philosophy of all CSR initiatives of the Company is to make CSR a key business process for sustainable development of the society. The initiatives aim at enhancing welfare measures of the society based on the immediate and long term social and environmental consequence of its activities.

The Company intends to undertake other need based initiatives in compliance with Schedule VII of the Act.

The CSR Policy may be accessed on the Company’s website www.escortsgroup.com under Investors Information Section. During the year, the Company has spent Rs.3.30 Cr. (1.93% of the average net profits of last three financial years) on CSR activities.

The Annual Report on CSR activities is enclosed as Annexure - F and forms an integral part of this Report.

Indian Accounting Standards

The Ministry of Corporate Affairs (MCA) on February 16, 2015, notified that Indian Accounting Standards (Ind AS) are applicable to certain classes of companies from April 1, 2016 with a transition date of April 1, 2015. Ind AS has replaced the previous Indian GAAP prescribed under Section 133 of the Companies Act, 2013 (“the Act”) read with Rule 7 of the Companies (Accounts) Rules, 2014. Ind AS is applicable to the Company from April 1, 2016.

The reconciliations and descriptions of the effect of the transition from previous GAAP to Ind AS have been set out in Note 49 in the notes to accounts in the standalone financial statement and in Note 49 in the notes to accounts in the consolidated financial statement.

Consolidated Financial Statements

The Consolidated Financial Statements have been prepared in accordance with the Act and Indian Accounting Standard (IND AS) - 110 applicable to the Consolidated Financial Statements read with IND AS-28 on Accounting for Investments in Associates and IND AS-31 on Financial Reporting of Interests in Joint Ventures issued by The Institute of Chartered Accountants of India. The Audited Consolidated Financial Statements along with the Auditors’ Report thereon are annexed with this Report.

Subsidiaries, Joint Ventures and Associate Companies

The statement containing salient features of financial statements of subsidiaries, associate and joint venture companies prepared in accordance with Section 129 of the Act read with Rule 5 of Companies (Accounts) Rules, 2014, forms an integral part of this Report. The Consolidated Financial Statements presented by the Company include the financial results of its subsidiaries, associate and joint venture companies.

The Company will make available the Annual Accounts of its subsidiaries, associate and joint venture companies and related information to the members of the Company who may be interested in obtaining the same. The annual accounts of its subsidiaries, associate and joint venture companies will also be kept open for inspection at the Registered Office of the Company.

Contracts and Arrangements with Related Parties

All contracts/ arrangements/ transactions entered 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 of the Company on the materiality of related party transactions.

The particulars of contracts and arrangement with related parties under Section 188(1) of the Act in Form AOC-2 is enclosed as Annexure - G.

The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board may be accessed on the Company’s website www. escortsgroup.com under Investors Information Section.

Your Directors draw attention of the members to Note 48 in the notes to accounts in the standalone financial statement and to note 47 in the notes to accounts in the consolidated financial statement which sets out related party disclosures.

Auditors and Auditors’ Report Statutory Auditors

Pursuant to the provisions of Section 139 of the Act read with Companies (Audit and Auditors) Rules, 2014, M/s. S.N. Dhawan & Co. LLP, Chartered Accountants, Delhi (Firm Registration No. 000050N/N50004) Statutory Auditors of the Company, hold office till the conclusion of the ensuing AGM and are not eligible for re-appointment.

M/s. Walker Chandiok & Co LLP, Chartered Accountants, New Delhi (Firm Registration No. 001076N/ N500013) have shown their interest to act as Statutory Auditors of the Company for a period of 5 years subject to the ratification of their appointment at every AGM.

The Company has received letter of confirmation from M/s. Walker Chandiok & Co LLP, Chartered Accountants to the effect that their appointment, if made, would be within the prescribed limits under Section 139 of the Act and that they are not disqualified for such appointment within the meaning of Section 141 of the Act, read with Companies (Audit and Auditors) Rules, 2014.

The observations and comments given by M/s. S.N. Dhawan & Co. LLP, Chartered Accountants, Statutory Auditors in their report read together with notes to Accounts for the year ended March 31, 2017 are self-explanatory and hence, do not call for any further comments under Section 134 of the Act.

Cost Auditors

The Board of Directors of the Company has re-appointed M/s. Ramanath Iyer and Co., Cost Accountants, New Delhi (Firm Registration No. 000019), Cost Auditors of the Company under Section 148 of the Act, for conducting the audit of cost records for the financial year 2017-18.

The due date of filing the Cost Audit Report for the year ended on March 31, 2016 was September 30, 2016 and the same has been filed on September 28, 2016.

Secretarial Auditors

The Board of Directors of the Company had appointed M/s. Jayant Gupta and Associates, Practicing Company Secretary to conduct secretarial audit of the Company for the financial year 2016-17. The Secretarial Audit Report for the financial year ended March 31, 2017 is enclosed as Annexure - H and forms an integral part of this Report.

The observations and comments given by the Secretarial Auditors in their report are self-explanatory and hence, do not call for any further comments under Section 204(3) of the Act.

The Board has also re-appointed M/s. Jayant Gupta and Associates, Practicing Company Secretary to conduct secretarial audit of the Company for the financial year 2017-18.

Risk Management

A Risk Management Committee which has been entrusted with the responsibility to assist the Board in (a) overseeing and approving the Company’s enterprise wide risk management framework; and (b) Overseeing that all the risks that the organisation faces such as strategic, financial, credit, market, liquidity, security, property, IT, legal, regulatory, reputational and other risks have been identified and assessed and there is an adequate risk management infrastructure in place capable of addressing those risks. The Risk Management Policy was reviewed and approved by the Committee.

Internal Financial Controls

The Company has in place adequate internal financial controls for ensuring the orderly and efficient conduct of its business. During the year, such controls were tested and no reportable material weakness in the design or operation was observed.

Disclosures Meetings of the Board

Five meetings of the Board of Directors were held during the year. For further details, please refer Report on Corporate Governance annexed as Annexure - E to this Report.

Audit Committee

For constitution and other details of the Audit Committee, please refer Report on Corporate Governance annexed as Annexure-E to this Report.

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

Extracts of Annual Return

in terms of provisions of Section 92 of the Act read with the Companies (Management and Administration) Rules, 2014, the extracts of Annual Return in Form MGT-9 is enclosed as Annexure - I and forms an integral part of this Report.

Vigil Mechanism

The Company has a vigil mechanism for Directors and Employees to report their concerns about unethical behavior, actual or suspected fraud or violation of the Company’s Code of Conduct. The mechanism provides for adequate safeguards against victimization of effected Director(s) and Employee(s). In exceptional cases, Directors and Employees have direct access to the Chairman of the Audit Committee. The Whistle Blower Policy is available on Company’s website.

Registrar and Share Transfer Agent

The Share Transfer and related activities are being carried out by M/s Karvy Computershare Private Limited, Registrar and Share Transfer Agents (Karvy RTA), from the following address: -

M/s Karvy Computershare Private Limited Karvy Selenium, Tower B, Plot No. 31-32, Gachibowli, Financial District, Nanakramguda, Hyderabad-500032, Telengana

All correspondence may kindly be sent to the above address only.

Particulars of Loans given. Investments made. Guarantees given and Securities provided

Particulars of loans given, investments made, guarantees given and securities provided along with the purpose for which the loan or guarantee or security is proposed to be utilised by the recipient has been given elsewhere in the Annual Report and forms an integral part of this Report.

Particulars of Employees and related disclosures

In terms of provisions of Section 197(12) of the Act, read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement showing the names and other particulars of the employees drawing remuneration in excess of the prescribed limits are available with the Company Secretary. Having regard to the provisions of Section 136(1) of the Act, the Annual Report excluding the aforesaid information is being sent to the members of the Company. Any member interested in obtaining such particulars may write to the Company Secretary of the Company and the same will be furnished on request.

Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed as Annexure - J and forms an integral part of this Report.

Public Deposits

The Company has not accepted/ renewed any Fixed Deposit during the financial year.

Transfer to Investor Education and Protection Fund

Pursuant to the provisions of Section 205A(5) of the Act, the dividend which remained unclaimed or unpaid for a period of seven years has been transferred by the Company, from time to time on due dates to the Investor Education and Protection Fund.

As on March 31, 2017, no unclaimed deposits are pending for transfer to Investor Education and Protection Fund.

Divestment of Auto Products Business

During the year, the Company has divested its OEM & Export Business of Auto Product Division as a part of the planned strategic reorientation of the business to focus on core verticals in the Agri-Machinery, Construction Equipment and Railway Equipment segments.

Credit Rating

During the year, the credit rating of the Company have been upgraded as under:

India Ratings has upgraded the long-term rating from 1ND A- to’IN DA’.

ICRA Limited has upgraded the long-term rating from “A-” to “A” with upward change in outlook from “STABLE” to “POSITIVE”.

Business Responsibility Report

As stipulated under the Listing Regulations, the Business Responsibility Report describing the initiatives taken by the Company from an environmental, social and governance perspective can be accessed at the website of the Company www.escortsgroup.com under Investor Information Section.

Directors’ Responsibility Statement

Pursuant to the requirement under Section 134(5) of the Act, with respect to Directors’ Responsibility Statement, your Directors hereby state that:

(i) in the preparation of the annual accounts for the year ended March 31, 2017, the applicable accounting standards read with requirements set out under Schedule III to the Act, have been followed alongwith proper explanation relating to material departures;

(ii) the Directors have selected such accounting policies and applied them consistently and made judgements 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 March 31, 2017 and of the profit and loss 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 the 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 financialyear ended March 31, 2017 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 are operating effectively; and

(vi) the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

General

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

1. Details relating to deposits covered under Chapter V of the Act.

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

3. Issue of shares (including sweat equity shares) to employees of the Company under any scheme save and except ESOS referred to in this Report.

4. Neither the Managing Director nor the Whole-time Directors of the Company receive any remuneration or commission from any of its subsidiaries.

5. No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Company’s operations in future.

Your Directors further state that 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.

Acknowledgement

Your Directors would like to express their sincere appreciation of the positive co-operation received from the Central Government, the Government of Haryana and Uttaranchal, Financial Institutions and the Company’s Bankers, Customers and Dealers.

The Directors also wish to place on record their deep sense of appreciation for the commitment displayed by all executives, officers, workers and staff of the Company resulting in the successful performance of the Company during the year.

The Board also takes this opportunity to express its deep gratitude for the continued co-operation and support received from its valued shareholders.

For and on behalf of the Board of Directors

Sd/-

Place: Faridabad RAJAN NANDA

Date: May 29, 2017 Chairman & Managing Director

---

Mar 31, 2016

Dear Shareholder''s

The Directors have pleasure in presenting the Seventieth Annual Report for the year ended on March 31, 2016.

Financial Results

(Rs. Cr)

Particulars For the year ended on For the year ended on March 31,2016 March 31,2015

Gross Revenue 3610.70 4122.29

Excise Duty 80.70 75.81

Net Revenue 3530.00 4046.48

Profit Before Interest, Depreciation, Amortisation, Exceptional Items & Tax 217.78 222.05

Finance Cost 51.29 57.11

Profit Before Depreciation, Amortisation, Exceptional Items & Tax 166.49 164.94

Depreciation and Amortisation 60.11 66.06

Profit Before Exceptional Items & Tax 106.38 98.88

Exceptional Income 14.51 30.63

Profit Before Tax 91.87 68.25

Tax 2.49 (6.46)

Profit After Tax 89.38 74.71

Financial Performance

The brief highlights of the Company''s performance for the financial year ended March 31, 2016 are:-

- Net Revenue of the Company for the Financial Year 2015-16 was Rs.3530 Cr.

- Profit Before Interest, Depreciation, Amortisation, Exceptional Items & Tax stood at Rs.217.78 Cr.

- Profit Before Tax (PBT) stood at Rs.91.87 Cr and Profit After Tax (PAT) stood at Rs.89.38 Cr. Earnings per share is of Rs.7.49 for the year under review.

- Your Company sold 51455 tractors during the year under review.

Management Discussion & Analysis

Management Discussion & Analysis which forms an integral part of this Annual Report provides a detailed analysis on the performance of individual businesses and their outlook.

Dividend

Your Directors are pleased to recommend a Dividend of Rs.1.20 per Equity Share (12%) on the face value of Rs.10 each, aggregating Rs.14.71 Cr. (exclusive of tax on dividend) for the financial year ended March 31, 2016. The dividend payout is subject to the approval of members at the ensuing Annual General Meeting (AGM).

The dividend, if approved at the ensuing AGM, will be paid to members whose names appear in the Register of Members as on September 9, 2016; in respect of shares held in dematerialised form, it will be paid to members whose names are furnished by National Securities Depository Limited and Central Depository Services (India) Limited, as beneficial owners as on that date.

The dividend payout for the period under review has been formulated in accordance with shareholders'' aspirations and the Company''s policy to pay sustainable dividend linked to long-term growth objectives of the Company to be met by internal cash accruals.

Employee Stock Option Scheme

The particulars with regard to the Employees Stock Options as on March 31, 2016 as required to be disclosed pursuant to the provisions of Clause 12 of SEBI (Employees Stock Option Scheme and Employees Stock Purchase Scheme) Guidelines, 1999, as amended, are enclosed at Annexure - A and forms an integral part of this Report.

Directors

In accordance with the provisions of Companies Act, 2013 (hereinafter referred as "the Act") and Articles of Association of the Company, Mr. Hardeep Singh and Mr. G.B. Mathur, Directors retires by rotation at the ensuing AGM and being eligible, offers themselves for re-appointment.

The Board of Directors, in their meeting held on May 25, 2016, co-opted Mr. D J Kakalia as Additional Director on the Board of the Company. He shall hold office as Director of the Company upto the date of ensuing AGM.

Mr. S.C. Bhargava had resigned as Director of the Company w.e.f. March 29, 2016. The Board places on record its appreciation for the valuable guidance and services rendered by him during his tenure with the Company.

Pursuant to the provisions of Section 149 and other applicable provisions of the Act, your directors are seeking appointment of Mr. D J Kakalia as Independent Director for a period of 3 years. The Company has received requisite notice in writing from members proposing the appointment of Mr. D J Kakalia as Director of the Company

The Company has received declarations from all the Independent Directors of the Company confirming that they meet with criteria of independence as prescribed under sub-section (6) of Section 1 49 of the Act and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred as "the Listing Regulations"). The policy for selection of directors and determining directors independence is attached as Annexure - B and forms an integral part of this Report.

The Company has devised a Policy for performance evaluation of Independent Directors, Board, Committees and other individual Directors which includes criteria for performance evaluation of the Non-Executive and Executive Directors. In accordance with the Policy, a process of evaluation was followed by the Board for its own performance and that of its Committees and individual Directors. The remuneration policy for directors, key managerial personnel and other employees is annexed as Annexure - C and forms an integral part of this Report.

The brief resumes and other details relating to the Directors who are proposed to be appointed/ re-appointed, as required to be disclosed under the Listing Regulations is given in the Annexure to the Notice of the 70th AGM.

Your Directors recommend the appointment/ re-appointment of the above said Directors at the ensuing AGM.

The details of programme for familiarisation of Independent Directors with the Company, their roles, rights, responsibilities in the Company, nature of industry in which the Company operates, business model of the Company and related matters are put up on the website of the Company - www. escortsgroup.com.

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

The particulars relating to conservation of energy, technology absorption, foreign exchange earnings and outgo, as required to be disclosed under Section 134(3)(m) of the Act read with Companies (Accounts) Rules, 2014 are provided as Annexure - D and forms an integral part of this Report.

Corporate Governance

Your Company reaffirms its commitment to the good corporate governance practices and has adopted the Code of Conduct which has set out the systems, processes and policy conforming to international standards. Pursuant to the Listing Regulations, Corporate Governance Report and Auditors'' Certificate regarding compliance of conditions of Corporate Governance are enclosed as Annexure - E and forms an integral part of this Report.

Corporate Social Responsibility

The key philosophy of all CSR initiatives of the Company is to make CSR a key business process for sustainable development of the society. The initiatives aim at enhancing welfare measures of the society based on the immediate and long term social and environmental consequence of its activities.

The Company intends to undertake other need based initiatives in compliance with Schedule VII of the Act.

The CSR Policy may be accessed on the Company''s website www.escortsgroup.com under Investors Information Section. During the year, the Company has spent Rs.1.16 Cr. (0.71% of the average net profits of last three financial years) on CSR activities.

The Annual Report on CSR activities is enclosed as Annexure

- F and forms an integral part of this Report.

Consolidated Financial Statements

The Consolidated Financial Statements have been prepared in accordance with the Act and Accounting Standard (AS) - 21 applicable to the Consolidated Financial Statements read with AS-23 on Accounting for Investments in Associates and AS-27 on Financial Reporting of Interests in Joint Ventures issued by The Institute of Chartered Accountants of India. The Audited Consolidated Financial Statements along with the Auditors'' Report thereon are annexed with this Report.

Subsidiaries, Joint Ventures and Associate Companies

The statement containing salient features of financial statements of subsidiaries, associate and joint venture companies prepared in accordance with Section 129 of the Act read with Rule 5 of Companies (Accounts) Rules, 2014, forms an integral part of this Report. The Consolidated Financial Statements presented by the Company include the financial results of its subsidiaries, associate and joint venture companies.

The Company will make available the Annual Accounts of its subsidiaries, associate and joint venture companies and related information to the members of the Company who may be interested in obtaining the same. The annual accounts of its subsidiaries, associate and joint venture companies will also be kept open for inspection at the Registered Office of the Company

Contracts and Arrangements with Related Parties

All contracts/ arrangements/ transaction entered 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 of the Company on the materiality of related party transactions.

The particulars of contracts and arrangement with related parties under Section 188(1) of the Act in Form AOC-2 is enclosed as Annexure - G.

The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board may be accessed on the Company''s website www. escortsgroup.com under Investors Information Section.

Your Directors draw attention of the members to Note 45 to the financial statement which sets out related party disclosures.

Auditors and Auditors'' Report Statutory Auditors

M/s. S.N. Dhawan & Co., Chartered Accountants, Delhi (Firm Registration No. 000050N) Statutory Auditors of the Company, hold office till the conclusion of the ensuing AGM and are eligible for re-appointment.

The Company has received letter of confirmation from M/s. S. N. Dhawan & Co., Chartered Accountants to the effect that their appointment, if made, would be within the prescribed limits under Section 139 of the Act and that they are not disqualified for such appointment within the meaning of Section 141 of the Act read with Companies (Audit and Auditors) Rules, 2014.

The observations and comments given by the Statutory Auditors in their report read together with notes to Accounts are self-explanatory and hence, do not call for any further comments under Section 134 of the Act.

Cost Auditors

The Board of Directors of the Company has re-appointed M/s. Ramanath Iyer and Co., Cost Accountants, New Delhi (Firm Registration No. 000019), Cost Auditors of the Company under Section 148 of the Act for conducting the audit of cost records for the financial year 2016-17.

The due date of filing the Cost Audit Report for the year ended on March 31, 2015 was September 30, 2015 and the same has been filed on September 28, 2015.

Secretarial Auditors

The Board of Directors of the Company had appointed M/s. Jayant Gupta and Associates, Practicing Company Secretary to conduct secretarial audit of the Company for the financial year 2015-16. The Secretarial Audit Report for the financial year ended March 31, 2016 is enclosed as Annexure - H and forms an integral part of this Report.

The observations and comments given by the Secretarial Auditors in their report are self-explanatory and hence, do not call for any further comments under Section 204(3) of the Act.

The Board has also re-appointed M/s Jayant Gupta and Associates, Practicing Company Secretary to conduct secretarial audit of the Company for the financial year 2016-17.

Risk Management

A Risk Management Committee which has been entrusted with the responsibility to assist the Board in (a) overseeing and approving the Company''s enterprise wide risk management framework; and (b) overseeing that all the risks that the organisation faces such as strategic, financial, credit, market, liquidity, security, property, IT, legal, regulatory, reputational and other risks have been identified and assessed and there is an adequate risk management infrastructure in place capable of addressing those risks. The Risk Management Policy was reviewed and approved by the Committee.

Internal Financial Controls

The Company has in place adequate internal financial controls for ensuring the orderly and efficient conduct of its business. During the year, such controls were tested and no reportable material weakness in the design or operation was observed.

Disclosures Meetings of the Board

Six meetings of the Board of Directors were held during the year. For further details, please refer Report on Corporate Governance annexed as Annexure - E to this Report.

Audit Committee

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

For constitution and other details of the Audit Committee, please refer Report on Corporate Governance annexed as Annexure - E to this Report.

Extracts of Annual Return

In terms of provisions of Section 92 of the Act read with the Companies (Management and Administration) Rules, 2014, the extracts of Annual Return in Form MGT-9 is enclosed as Annexure - I and forms an integral part of this Report.

Vigil Mechanism

The Company has a vigil mechanism for Directors and Employees to report their concerns about unethical behavior, actual or suspected fraud or violation of the Company''s Code of Conduct. The mechanism provides for adequate safeguards against victimization of effected Director(s) and Employee(s). In exceptional cases, Directors and Employees have direct access to the Chairman of the Audit Committee. The Whistle Blower Policy is available on Company''s website.

Shifting of Registered Office

The Company has shifted its registered office within the State of Haryana from "SCO-232, First Floor, Sector - 20, Panchkula - 134 109" to "15/5, Mathura Road, Faridabad - 121 003" w.e.f. January 30, 2016.

Registrar and Share Transfer Agent

The Company has appointed M/s Karvy Computershare Private Limited, Karvy Selenium, Tower B, Plot No. 31-32, Gachibowli, Financial District, Nanakramguda, Hyderabad - 500 032, Andhra Pradesh w.e.f February 19, 2016 as Registrar and Share Transfer Agent.

Particulars of Loans given, Investments made, Guarantees given and Securities provided

Particulars of loans given, investments made, guarantees given and securities provided along with the purpose for which the loan or guarantee or security is proposed to be utilised by the recipient has been given elsewhere in the Annual Report and forms an integral part of this Report.

Particulars of Employees and related disclosures

In terms of provisions of Section 197(12) of the Act read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement showing the names and other particulars of the employees drawing remuneration in excess of the prescribed limits is available with the Company Secretary. Having regard to the provisions of Section 136(1) of the Act, the Annual Report excluding the aforesaid information is being sent to the members of the Company. Any member interested in obtaining such particulars may write to the Company Secretary of the Company and the same will be furnished on request.

Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed as Annexure - J and forms an integral part of this Report.

Public Deposits

The Company has not accepted/ renewed any Fixed Deposit during the financial year.

Transfer to Investor Education and Protection Fund

Pursuant to the provisions of Section 205A(5) of the Companies Act, 1956, the dividend which remained unclaimed or unpaid for a period of seven years has been transferred by the Company, from time to time on due dates to the Investor Education and Protection Fund.

As on March 31, 2016, no unclaimed deposits are pending for transfer to Investor Education and Protection Fund.

Directors'' Responsibility Statement

Pursuant to the requirement under Section 1 34(5) of the Act with respect to Directors'' Responsibility Statement, your Directors hereby state that:

(i) in the preparation of the annual accounts for the year ended March 31, 2016, the applicable accounting standards read with requirements set out under Schedule III to the Act, have been followed alongwith proper explanation relating to material departures;

(ii) the Directors have selected such accounting policies and applied them consistently and made judgements 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 March 31, 2016 and of the profit and loss 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 the 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 March 31, 2016 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 are operating effectively; and

(vi) the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

General

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

1. Details relating to deposits covered under Chapter V of the Act.

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

3. Issue of shares (including sweat equity shares) to employees of the Company under any scheme save and except ESOS referred to in this Report.

4. Neither the Managing Director nor the Whole-time Directors of the Company receive any remuneration or commission from any of its subsidiaries.

5. No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Company''s operations in future.

Your Directors further state that 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.

Acknowledgement

Your Directors would like to express their sincere appreciation of the positive co-operation received from the Central Government, the Government of Haryana, Karnataka and Uttaranchal, Financial Institutions and the Company''s Bankers, Customers and Dealers.

The Directors also wish to place on record their deep sense of appreciation for the commitment displayed by all executives, officers, workers and staff of the Company resulting in the successful performance of the Company during the year

The Board also takes this opportunity to express its deep gratitude for the continued co-operation and support received from its valued shareholders.

For and on behalf of the Board of Directors

Sd/-

Place: Faridabad RAJAN NANDA

Date: May 25, 2016 Chairman & Managing Director

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Mar 31, 2015

Dear Members,

The Directors have pleasure in presenting the Sixty Ninth Annual Report for the year ended on March 31, 2015.

Financial Results

Particulars For the period of For the period of 12 months ended 18 months ended on March 31, 2015 on March 31, 2014

(Rs. Cr)

Gross Revenue 4122.29 6505.79

Excise Duty 75.81 132.87

Net Revenue 4046.48 6372.92

Profit Before Interest, 222.05 462.65 Depreciation,Amortisation, Exceptional Items & Tax

Finance Cost 57.11 110.67

Profit Before Depreciation, 164.94 351.98 Amortisation, Exceptional Items & Tax

Depreciation and Amortisation 66.06 83.22

Profit Before Exceptional 98.88 268.76 Items & Tax

Exceptional Income 30.63 (3.64)

Profit Before Tax 68.25 272.40

Tax (6.46) 27.51

Profit After Tax 74.71 244.89

Financial Performance

* The brief highlights of the Company''s performance for the financial year ended March 31, 2015 are:-

*Net Revenue of the Company for the Financial Year 2014-15 was Rs. 4046.48 Cr.

*Profit Before Interest, Depreciation, Amortisation, Exceptional Items & Tax stood at Rs. 222.05 Cr.

* Profit Before Tax (PBT) stood at Rs. 68.25 Cr and Profit After Tax (PAT) stood at Rs. 74.71 Cr. Earnings per share is of Rs. 6.26 for the year under review.

* Your Company sold 59779 tractors during the year under review.

Management Discussion & Analysis

Management Discussion & Analysis which forms an integral part of this Annual Report provides a detailed analysis on the performance of individual businesses and their outlook.

Dividend

Your Directors are pleased to recommend a Dividend of Rs. 1.20 per Equity Share (12%) on the face value of Rs. 10 each, aggregating Rs. 14.71 Cr (exclusive of tax on dividend) for the financial year ended March 31, 2015. The dividend payout is subject to the approval of members at the ensuing Annual General Meeting (AGM).

The dividend, if approved at the ensuing AGM, will be paid to members whose names appear in the Register of Members as on Friday, September 4, 2015; in respect of shares held in dematerialised form, it will be paid to members whose names are furnished by National Securities Depository Limited and Central Depository Services (India) Limited, as beneficial owners as at that date.

The dividend payout for the period under review has been formulated in accordance with shareholders'' aspirations and the Company''s policy to pay sustainable dividend linked to long-term growth objectives of the Company to be met by internal cash accruals.

Employee Stock Option Scheme

The particulars with regard to the Employees Stock Options as on March 31, 2015 as required to be disclosed pursuant to the provisions of Clause 12 of SEBI (Employees Stock Option Scheme and Employees Stock Purchase Scheme) Guidelines, 1999, as amended, are enclosed at Annexure - A and forms an integral part of this Report.

Directors

In accordance with the provisions of Companies Act, 2013 and Articles of Association of the Company, Mr. Hardeep Singh, Director retires by rotation at the ensuing AGM and being eligible, offers himself for re-appointment.

The Board of Directors, in their meeting held on January 16, 2015, co-opted Dr. Sutanu Behuria, Ms. Nitasha Nanda and Mr. G.B. Mathur as Additional Directors on the Board of the Company. They shall hold office of Director(s) upto date of ensuing AGM.

Further, Ms. Nitasha Nanda, has been appointed as Whole-time Director for a period of 5 years w.e.f. January 16, 2015, liable to retire by rotation, subject to the approval of the shareholders in the ensuing AGM. Her appointment is appropriate and in the best interest of the Company.

Pursuant to the provisions of Section 149 and other applicable provisions of the Companies Act, 2013, your Directors are seeking appointment of Dr. Sutanu Behuria as Independent Director for a period of 3 years. The Company has received requisite notices in writing from members proposing Dr. Sutanu Behuria, Ms. Nitasha Nanda and Mr. G.B. Mathur for appointment as Directors of the Company.

The Company has received declarations from all the Independent Directors of the Company confirming that they meet with criteria of independence as prescribed under sub-section (6) of Section 149 of the Companies Act, 2013 and under Clause 49 of the Listing Agreement with the Stock Exchanges. The policy for selection of directors and determining directors independence is attached as Annexure - B and forms an integral part of this Report.

The Company has devised a Policy for performance evaluation of Independent Directors, Board, Committees and other individual Directors which includes criteria for performance evaluation of the Non-Executive and Executive Directors. In accordance with the Policy, a process of evaluation was followed by the Board for its own performance and that of its Committees and individual Directors. The remuneration policy for directors, key managerial personnel and other employees is annexed as Annexure - C and forms an integral part of this Report.

The brief resumes and other details relating to the Directors who are proposed to be appointed/ re-appointed, as required to be disclosed under Clause 49 of the Listing Agreement is given in the Annexure to the Notice of the 69th AGM.

Your Directors recommend the appointment/ re-appointment of the above said Directors at the ensuing AGM.

The details of programme for familarisation of Independent Directors with the Company, their roles, rights, responsibilities in the Company, nature of industry in which the Company operates, business model of the Company and related matters are put up on the website of the Company - www.escortsgroup.com.

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

The particulars relating to conservation of energy, technology absorption, foreign exchange earnings and outgo, as required to be disclosed under Section 134(3)(m) of the Companies Act, 2013 read with Companies (Accounts) Rules, 2014 are provided as Annexure - D and forms an integral part of this Report.

Corporate Governance

Your Company reaffirms its commitment to the good corporate governance practices and has adopted the Code of Conduct which has set out the systems, processes and policy conforming to international standards. Pursuant to Clause 49 of the Listing Agreement with the Stock Exchanges, Corporate Governance Report and Auditors'' Certificate regarding compliance of conditions of Corporate Governance are enclosed as Annexure - E and forms an integral part of this Report.

Corporate Social Responsibility

During the financial year ended March 31,2015, the Corporate Social Responsibility (CSR) Committee had been reconstituted by inducting Mr. G.B. Mathur and Mrs. Vibha Paul Rishi as members of the Committee w.e.f. January 16, 2015.

The CSR Committee comprises of following Directors:

1. Mr. Rajan Nanda (Chairman)

2. Mr. Nikhil Nanda

3. Mr. Hardeep Singh

4. Mr. S.C. Bhargava

5. Mrs. Vibha Paul Rishi

6. Mr. G.B. Mathur

The said committee has been entrusted with the responsibility of formulating and recommending to the Board, a Corporate Social Responsibility Policy (CSR Policy) indicating the activities to be undertaken by the Company, monitoring the implementation of the framework of CSR Policy and recommending the amount to be spent on CSR activities.

The key philosophy of all CSR initiatives of the Company is to make CSR a key business process for sustainable development of the society. The initiatives aim at enhancing welfare measures of the society based on the immediate and long term social and environmental consequence of its activities.

The Company intends to undertake other need based initiatives in compliance with Schedule VII of the Act.

The CSR Policy may be accessed on the Company''s website www.escortsgroup.com under Investors Information Section.

During the year, the Company has spent Rs. 0.78 Cr. (0.48% of the average net profits of last three financial years) on CSR activities.

Since being the first year of the CSR Committee, the Company under the guidance and directions of the Committee is formulating its initiatives for undertaking activities as identified in the CSR Policy. The full impact of the CSR spend shall be felt in the financial year 2015-16.

The Annual Report on CSR activities is enclosed as Annexure - F and forms an integral part of this Report.

Consolidated Financial Statements

The Consolidated Financial Statements in accordance with the Companies Act, 2013 and Accounting Standard (AS) - 21 applicable to the Consolidated Financial Statements read with AS-23 on Accounting for Investments in Associates and AS- 27 on Financial Reporting of Interests in Joint Ventures issued by The Institute of Chartered Accountants of India have been prepared. The Audited Consolidated Financial Statements along with the Auditors'' Report thereon are annexed with this Report.

Subsidiaries, Joint Ventures and Associate Companies

The statement containing salient features of financial statements of subsidiaries, associate and joint venture companies prepared in accordance with Section 129 of the Companies Act, 2013 read with Rule 5 of Companies (Accounts) Rules, 2014, forms an integral part of this Report. The Consolidated Financial Statements presented by the Company include the financial results of its subsidiaries, associate and joint venture companies.

The Company will make available the Annual Accounts of its subsidiaries, associate and joint venture companies and related information to the members of the Company who may be interested in obtaining the same. The annual accounts of its subsidiaries, associate and joint venture companies will also be kept open for inspection at the Registered Office of the Company.

Contracts and Arrangements with Related Parties

All contract/ arrangements/ transactions entered 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 of the Company on the materiality of related party transactions. The particulars of contracts and arrangement with related parties under Section 188(1) of the Act in Form AOC-2 is enclosed as Annexure - G.

The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board may be accessed on the Company''s website www.escortsgroup.com under Investors Information Section. Your Directors draw attention of the members to Note 46 to the financial statement which sets out related party disclosures.

Auditors and Auditors'' Report

Statutory Auditors

M/s. S.N. Dhawan & Co., Chartered Accountants, Delhi (Firm Registration No. 000050N) Statutory Auditors of the Company, hold office till the conclusion of the ensuing AGM and are eligible for re-appointment.

The Company has received letter of confirmation from M/s. S.N. Dhawan & Co., Chartered Accountants to the effect that their appointment, if made, would be within the prescribed limits under Section 139 of the Companies Act, 2013 and that they are not disqualified for such appointment within the meaning of Section 141 of the Companies Act, 2013 read with Companies (Audit and Auditors) Rules, 2014.

The observations and comments given by the Statutory Auditors in their report read together with notes to Accounts are self- explanatory and hence, do not call for any further comments under Section 134 of the Companies Act, 2013.

Cost Auditors

The Board of Directors of the Company has re-appointed M/s. Ramanath Iyer and Co., Cost Accountants, New Delhi (Firm Registration No. 000019), Cost Auditors of the Company under Section 148 of the Companies Act, 2013 for conducting the audit of cost records for the financial year 2015-16.

The due date of filing the Cost Audit Report for the eighteen months period ended on March 31, 2014 was September 30, 2014 and the same has been filed on September 22, 2014.

Secretarial Auditors

The Board of Directors of the Company has appointed M/s. Jayant Gupta and Associates, Practicing Company Secretary to conduct secretarial audit of the Company for the financial year 2014-15. The Secretarial Audit Report for the financial year ended March 31, 2015 is enclosed as Annexure - H and forms an integral part of this Report.

The observations and comments given by the Secretarial Auditors in their report are self-explanatory and hence, do not call for any further comments under Section 204(3) of the Companies Act, 2013.

Risk Management

During the year, your directors have constituted a Risk Management Committee which has been entrusted with the responsibility to assist the Board in (a) overseeing and approving the Company''s enterprise wide risk management framework; and (b) Overseeing that all the risks that the organisation faces such as strategic, financial, credit, market, liquidity, security, property, IT, legal, regulatory, reputational and other risks have been identified and assessed and there is an adequate risk management infrastructure in place capable of addressing those risks. The Risk Management Policy was reviewed and approved by the Committee.

Internal Financial Controls

The Company has in place adequate internal financial controls with reference to financial statements. During the year, such controls were tested and no reportable material weakness in the design or operation was observed.

Disclosures

Meetings of the Board

Five meetings of the Board of Directors were held during the year. For further details, please refer Report on Corporate Governance annexed as Annexure - E to this Report.

Audit Committee

The Audit Committee comprises of the following Non-Executive Directors:

1. Dr. S.A. Dave - Independent Director (Chairman)

2. Mr. S.C. Bhargava - Independent Director

3. Mr. Hardeep Singh - Non-Independent Director

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

Extracts of Annual Return

In terms of provisions of Section 92 of the Companies Act, 2013 read with the Companies (Management and Administration) Rules, 2014, the extracts of Annual Return in Form MGT-9 is enclosed as Annexure - I and forms an integral part of this Report.

Vigil Mechanism

The Company has a vigil mechanism for Directors and Employees to report their concerns about unethical behaviour, actual or suspected fraud or violation of the Company''s Code of Conduct. The mechanism provides for adequate safeguards against victimisation of Director(s) and Employee(s) who avail of the mechanism. In exceptional cases, Directors and Employees have direct access to the Chairman of the Audit Committee. The Whistle Blower Policy is available on Company''s website.

Particulars of Loans given, Investments made, Guarantees given and Securities provided

Particulars of loans given, investments made, guarantees given and securities provided along with the purpose for which the loan or guarantee or security is proposed to be utilised by the recipient has been given elsewhere in the Annual Report and forms an integral part of this Report.

Particulars of Employees and related disclosures

In terms of provisions of Section 197(12) of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement showing the names and other particulars of the employees drawing remuneration in excess of the prescribed limits are available with the Company Secretary. Having regard to the provisions of Section 136(1) of the said Act, the Annual Report excluding the aforesaid information is being sent to the members of the Company. Any member interested in obtaining such particulars may write to the Company Secretary of the Company and the same will be furnished on request.

Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed as Annexure - J and forms an integral part of this Report.

Public Deposits

The Company has not accepted/ renewed any Fixed Deposit during the financial year. All Fixed Deposits which were due and claimed by the deposit holders have been paid on time.

Transfer to Investor Education and Protection Fund

Pursuant to the provisions of Section 205A(5) of the Companies Act, 1956, the dividend which remained unclaimed or unpaid for a period of seven years has been transferred by the Company, from time to time on due dates to the Investor Education and Protection Fund.

As on March 31, 2015, 136 unclaimed deposits for the period of seven years aggregating to Rs. 26.45 lacs were transferred to Investor Education and Protection Fund.

Directors'' Responsibility Statement

Pursuant to the requirement under Section 134(5) of the Companies Act, 2013 with respect to Directors'' Responsibility Statement, your Directors hereby state that:

(i) in the preparation of the annual accounts for the year ended March 31, 2015, the applicable accounting standards read with requirements set out under Schedule III to the Act, have been followed alongwith proper explanation relating to material departures;

(ii) the Directors have selected such accounting policies and applied them consistently and made judgements 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 March 31, 2015 and of the profit and loss 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 the Companies Act, 2013 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 March 31, 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 are operating effectively; and

(vi) the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

General

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

1. Details relating to deposits covered under Chapter V of the Act.

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

3. Issue of shares (including sweat equity shares) to employees of the Company under any scheme save and except ESOS referred to in this Report.

4. Neither the Managing Director nor the Whole-time Directors of the Company receive any remuneration or commission from any of its subsidiaries.

5. No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Company''s operations in future.

Your Directors further state that 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.

Acknowledgement

Your Directors would like to express their sincere appreciation of the positive co-operation received from the Central Government, the Government of Haryana and Uttaranchal, Financial Institutions and the Company''s Bankers, Customers and Dealers.

The Directors also wish to place on record their deep sense of appreciation for the commitment displayed by all executives, officers, workers and staff of the Company resulting in the successful performance of the Company during the year.

The Board also takes this opportunity to express its deep gratitude for the continued co-operation and support received from its valued shareholders.

For and on behalf of the Board of Directors

Sd/- Place: Faridabad RAJAN NANDA Date: July 10, 2015 Chairman & Managing Director

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Mar 31, 2014

Dear Members,

The Directors have pleasure in presenting the Sixty Eighth Annual Report for the 18 months period ended on March 31, 2014.

Financial Results (RS Cr) Particulars For the period of 18 For the period of 12 months ended months on September 30,2012 ended on March 31,2014

Gross Revenue 6505.79 4046.10

Excise Duty 132.87 103.32

Net Revenue 6372.92 3942.78

Profit Before Interest, Depreciation, Amortisation, Exceptional Items & Tax 462.65 231.14

Finance Cost 110.67 96.44

Profit Before Depreciation, Amortisation, Exceptional Items & Tax 351.98 134.70

Depreciation and Amortisation 83.22 48.43

Profit Before Exceptional Items & Tax 268.76 86.27

Exceptional Income 3.64 1.68

Profit Before Tax 272.40 87.95

Tax 27.51 18.35

Profit After Tax 244.89 69.60

Financial Performance

For the financial period of 18 months ended on March 31, 2014 your Company has recorded improved revenue and margin performance. The brief highlights of the Company''s performance are:-

- Net Revenue of the Company for the 18 months period was Rs.6,372.92 Cr.

- Profit Before Interest, Depreciation, Amortisation, Exceptional Items & Tax stood at Rs.462.65 Cr.

- Profit Before Tax (PBT) stood at Rs.272.40 Cr and Profit After Tax (PAT) stood at Rs.244.89 Cr. Earnings per share is of Rs.20.53 for the period under review.

- Your Company sold 1,00,833 tractors during the period under review.

Management Discussion & Analysis

Management Discussion & Analysis which forms an integral part of this Annual Report provides a detailed analysis on the performance of individual businesses and their outlook.

Dividend

Your Company paid an Interim Dividend of Rs.1.20/- per Equity Share (12%) on the face value of Rs.10 each, aggregating Rs.14.71 Cr (exclusive of tax on dividend) during the financial

period ended on March 31, 2014.

Your Directors are pleased to recommend a Final Dividend of 60 paisa per Equity Share (6%) on the face value of H10 each, aggregating H7.35 Cr (exclusive of tax on dividend) for the 18 months period ended on March 31, 2014. The dividend payout is subject to approval of members at the ensuing Annual General Meeting.

The dividend, if approved at the ensuing Annual General Meeting, will be paid to members whose names appear in the Register of Members as on Friday, September 5, 2014; in respect of shares held in dematerialised form, it will be paid to members whose names are furnished by National Securities Depository Limited and Central Depository Services (India) Limited, as beneficial owners as at that date.

The dividend payout for the period under review has been formulated in accordance with shareholders'' aspirations and the Company''s policy to pay sustainable dividend linked to long term growth objectives of the Company to be met by internal cash accruals.

Employee Stock Option Scheme

The particulars with regard to the Employees Stock Options as on March 31, 2014 as required to be disclosed pursuant to

the provisions of Clause 12 of SEBI (Employees Stock Option Scheme and Employees Stock Purchase Scheme) Guidelines, 1999, as amended, are enclosed at Annexure - A and forms an integral part of this Report.

Extension of Financial Year

The Board of Directors of your Company had extended the financial year from the current period of 12 months ending September 30, 2013 to 18 months ended on March 31, 2014 for the purpose of aligning with the Companies Act, 2013 requirement with the permission of Registrar of Companies, NCT of Delhi & Haryana (ROC). The ROC has also granted extension of time for holding the Annual General Meeting of the Company upto September 21, 2014.

Directors

In accordance with the provisions of Companies Act, 2013 and Articles of Association of the Company, Mr. Hardeep Singh, Director retires by rotation at the ensuing Annual General Meeting and being eligible, offers himself for re-appointment.

Mr. Rajan Nanda, has been re-appointment as Managing Director for a further period of 5 years w.e.f April 1, 2015, subject to the approval of the shareholders in the ensuing Annual General Meeting. His appointment is appropriate and in the best interest of the Company.

The Board of Directors, in their meeting held on July 29, 2014, co-opted Mr. P.H. Ravikumar and Mrs. Vibha Paul Rishi as Additional Directors designated as Independent Directors on the Board of the Company. They shall hold office of Director upto the date of ensuing Annual General meeting.

Pursuant to the provisions of Section 149 and other applicable provisions of the Companies Act, 2013, your Directors are seeking appointment of Dr. S. A. Dave and Mr. S. C. Bhargava as Independent Directors for a period of 3 years. The Company has received requisite notices in writing from members proposing Mr. P.H. Ravikumar, Mrs. Vibha Paul Rishi, Dr. S.A. Dave and Mr. S.C. Bhargava for appointment as Independent Directors.

Dr. M.G.K. Menon and Dr. P.S. Pritam have resigned as Directors of the Company w.e.f. July 4, 2013 and June 4, 2014 respectively. The Board places on record their appreciation for the valuable guidance and services rendered by these Directors during their tenure with the Company.

The Company has received declarations from all the Independent Directors of the Company confirming that they meet with criteria of independence as prescribed both under sub-section (6) of Section 149 of the Companies Act, 2013 and under Clause 49 of the Listing Agreement with the Stock Exchanges.

The brief resumes and other details relating to the Directors who are proposed to be appointed/ re-appointed, as required to be disclosed under Clause 49 of the Listing Agreement, given in the Annexure to the Notice of 68th Annual General Meeting.

Your Directors recommend the appointment/ re-appointment of the above said Directors at the ensuing Annual General Meeting.

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

The particulars relating to conservation of energy, technology absorption, foreign exchange earnings and outgo, as required to be disclosed under Section 217(1)(e) of the Companies Act, 1956 read with Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 are provided in Annexure - B and forms an integral part of this Report.

Corporate Governance

Your Company reaffirms its commitment to the good corporate governance practices and has adopted the Code of Conduct which has set out the systems, processes and policy conforming to international standards. Pursuant to Clause 49 of the Listing Agreement with the Stock Exchanges, Corporate Governance Report and Auditors'' Certificate regarding compliance of conditions of Corporate Governance are enclosed as Annexure - C and forms an integral part of this Report.

Corporate Social Responsibility

Your Directors have constituted the Corporate Social Responsibility Committee comprising of Mr. Rajan Nanda as Chairman, Mr. Nikhil Nanda, Mr. Hardeep Singh and Mr. S. C. Bhargava as other members.

The said Committee has been entrusted with the responsibility of formulating and recommending to the Board, a Corporate Social Responsibility Policy (CSR Policy) indicating the activities to be undertaken by the Company, monitoring the implementation of the framework of the CSR Policy and recommending the amount to be spent on CSR activities.

Consolidated Financial Statements

Your Company has prepared Consolidated Financial Statements in accordance with the Accounting Standard - 21 applicable to the Consolidated Financial Statements issued by The Institute of Chartered Accountants of India. Audited Consolidated Financial Statements along with the Auditors'' Report thereon are annexed with this Report.

Subsidiary Companies

In accordance with the general circular 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 its subsidiary companies and related information to the members of the Company who may be interested in obtaining the same. The annual accounts of its

subsidiary companies will also be kept open for inspection at the Registered Office of the Company and that of the respective subsidiary companies. The Consolidated Financial Statements presented by the Company include the financial results of its subsidiary companies.

Auditors

M/s. S.N. Dhawan & Co., Chartered Accountants, Delhi (Firm Registration No. 000050N) Statutory Auditors of the Company, hold office until the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment.

The Company has received letter from M/s. S.N. Dhawan & Co., Chartered Accountants to the effect that their appointment, if made, would be within the prescribed limits under Section 139 of the Companies Act, 2013 and that they are not disqualified for such appointment within the meaning of Section 141 of the Companies Act, 2013 read with Companies (Audit and Auditors) Rules, 2014.

The observations and comments given by the Statutory Auditors in their report read together with notes to Accounts are self- explanatory and hence, do not call for any further comments under Section 217 of the Companies Act, 1956.

Cost Auditors

M/s. Ramanath Iyer and Co., Cost Accountants, New Delhi (Firm Registration No. 000019), Cost Auditors of the Company under Section 233 of the Companies Act, 1956 have been re- appointed as the Company''s Cost Auditors for the financial year 2014-15.

Particulars of Employees

In terms of provisions of Section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975, as amended, the names and other particulars of the employees are set out in the annexure to the Directors'' Report. Having regard to the provisions of Section 219(1)(b) (iv) of the said Act, the Annual Report excluding the aforesaid information is being sent to the members of the Company. Any member interested in obtaining such particulars may write to the Company Secretary of the Company.

Directors'' Responsibility Statement

Pursuant to the requirement under Section 217(2AA) of the Companies Act, 1956 with respect to Directors'' Responsibility Statement, it is hereby confirmed that:

(i) in the preparation of the Annual Accounts for the financial period ended on March 31, 2014, the applicable Accounting Standards have been followed alongwith proper explanation relating to material departures;

(ii) the Directors had 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 March 31, 2014 and of the profit of the Company for the financial period under review;

(iii) the Directors had taken proper and sufficient care 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; and

(iv) the Directors had prepared the annual accounts for financial period ended on March 31, 2014 on a ''going concern'' basis.

Public Deposits

The Company has not accepted/ renewed any Fixed Deposit during the financial period. All Fixed Deposits which were due and claimed by the deposit holders have been paid on time. As on March 31, 2014, 53 deposits aggregating to H0.11 Cr have matured but have not been claimed. Subsequently, out of the above, 11 deposits aggregating to H3 lacs have been repaid till the date of this report.

Transfer to Investor Education and Protection Fund

Pursuant to the provisions of Section 205A(5) of the Companies Act, 1956, the dividend which remained unclaimed or unpaid for a period of seven years has been transferred by the Company, from time to time on due dates, to the Investor Education and Protection Fund.

As on March 31, 2014, 123 unclaimed deposits for the period of seven years aggregating to H25.50 lacs were transferred to Investor Education and Protection Fund.

Acknowledgement

Your Directors would like to express their sincere appreciation for the positive co-operation received from the Central Government, the Government of Haryana and Uttaranchal, Financial Institutions and the Company''s Bankers, Customers and Dealers.

The Directors also wish to place on record their deep sense of appreciation for the commitment displayed by all executives, officers, workers and staff of the Company resulting in the successful performance of the Company during the period.

The Board also takes this opportunity to express its deep gratitude for the continued co-operation and support received from its valued shareholders.

For and on behalf of the Board of Directors

Sd/- Place: Faridabad AJAN NANDA Date: July 29, 2014 Chairman &Managing Director

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Sep 30, 2012

Dear Shareholders,

The Directors have pleasure in presenting the Sixty Seventh Annual Report for the financial year ended 30th September, 2012.

FINANCIAL RESULTS (Rs. Crores)

Particulars 30.09.12 30.09.11

Gross Revenue 4046.10 3305.78

Excise Duty 103.32 25.96

Net Revenue 3942.78 3279.82

Profit Before Interest, Depreciation, Amortisation, Exceptional Items & Tax 231.14 189.71

Finance Cost 96.44 55.77

Profit Before Depreciation, Amortisation, Exceptional Items & Tax 134.70 133.94

Depreciation and Amortisation 48.43 37.97

Profit/(loss) Before Tax, Exceptional Items & Tax 86.27 95.97

Exceptional Income 1.68 4.65

Profit Before Tax 87.95 100.62

Tax 18.35 (19.47)

Profit After Tax 69.60 120.09

FINANCIAL PERFORMANCE

The Net Revenue of the Company for the year was Rs. 3942.78 Crores as against Rs. 3279.82 Crores in the previous year showing a growth of 20.21%. Sale of Tractors during the year was 60673 as against 63420 in the previous year.

Profit before Interest, Depreciation, Amortisation, Exceptional Items & Tax stood at Rs. 231.14 Crores against Rs. 189.71 Crores in the previous year.

Profit Before Tax (PBT) stood at Rs. 87.95 Crores against Rs. 100.62 Crores in the previous year and Profit After Tax (PAT) stood at Rs. 69.60 Crores against Rs. 120.09 Crores in the previous year. Earnings per share stands at Rs. 5.84 for the current year vis a vis Rs. 11.74 last year. MANAGEMENT DISCuSSIoN AND ANALYSIS Management Discussion and Analysis (refer page 10 to 18), which forms an integral part of this Annual Report; provides a more detailed analysis on the performance of individual businesses and their outlook.

DIVIDEND

Your Directors are pleased to recommend a dividend @ 12% i.e. Rs. 1.20 per Equity Share of Rs. 10 each for the year ended 30th September, 2012, payable to those Shareholders whose names appear in the Register of Members as on the Book Closure Date, subject to the approval of shareholders at the ensuing Annual General Meeting.

SCHEME OF ARRANGEMENT AND COMPROMISE

A Scheme of Arrangement and Amalgamation under Section 391 to 394 of the Companies Act, 1956 for the amalgamation of Escorts Construction Equipment Limited (''ECEL''), Escotrac Finance and Investments Private Limited (''Escotrac'') and Escorts Finance Investments and Leasing Private Limited (''EFILL'') (together ''Transferor Companies'') with the Company (hereinafter referred to as ''the Scheme''), has been sanctioned by the Hon''ble High Court of Punjab and Haryana at Chandigarh vide its order dated 9th August, 2012 and upon necessary filings with the Registrar of Companies, NCT of Delhi and Haryana by the Transferor Companies and Transferee Company, the Scheme has become effective on 12th October, 2012 and the effect thereof has been given in the financial statements from 1st October, 2011 being the appointed date under the Scheme.

Pursuant to the Scheme, the issued and paid up share capital of the Company has increased from Rs. 105.62 crores to Rs. 122.58 crores as 1,69,58,842 equity shares were allotted to the shareholders of the transferor companies. The Authorized Share Capital of the Company stands enhanced to Rs. 1289 crores.

The investments held by the Company in the merging entities have been cancelled and wherever required the investment held by the later were transferred to the Escorts Benefit and Welfare Trust in accordance with the Scheme. Furthermore, pursuant to the scheme, Rs. 97.40 crores, being the difference between the net assets of the transferor companies and the purchase consideration issued by the Company is adjusted in Reserves of the Company.

EMPLOYEE STOCK OPTION SCHEME

Disclosure pursuant to the SEBI (Employees Stock Option Scheme and Employees Stock Purchase Scheme) Guidelines, 1999 is enclosed at Annexure - A and forms part of this Directors'' Report for the year ended 30th September, 2012.

DIRECTORS

In accordance with the provisions of Companies Act, 1956 and Articles of Association of Company, Dr. S.A. Dave and Mr. S.C. Bhargava, Directors retire by rotation at the ensuing Annual General Meeting of your Company, and being eligible, offer themselves for re-appointment.

The brief resumes and other details relating to the Directors who are proposed to be appointed/re-appointed, as required to be disclosed under Clause 49 of the Listing Agreement, forms part of the Report on Corporate Governance.

Your Directors recommend the appointment/re- appointment of the above said Directors at the ensuing Annual General Meeting.

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

Information required under Section 217(1)(e) of the Companies Act, 1956 read with Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 is given in Annexure - B and forms an integral part of this Report.

CORPORATE GOVERNANCE

Your Company reaffirms its commitment to the good corporate governance practices. Pursuant to Clause 49 of the Listing Agreement with the Stock Exchanges, Corporate Governance Report and Auditors'' Certificate regarding compliance of conditions of Corporate Governance are enclosed at Annexure - C and forms an integral part of this report.

CONSOLIDATED FINANCIAL STATEMENTS

Pursuant to Clause 32 and 50 of the Listing Agreement with Stock Exchanges, your Company has prepared Consolidated Financial Statements as per the Accounting Standards applicable to the Consolidated Financial Statements issued by The Institute of Chartered Accountants of India. Audited Consolidated Financial Statements along with the Auditors'' Report are annexed with this Report. subsidiary COMPANIES

The Ministry of Corporate Affairs (MCA), Government of India vide General Circular No. 2/2011 dated 8th February, 2011 has issued directions under Section 212(8) of the Companies Act, 1956 granting general exemption from the applicability of the provisions of Section 212 of the Companies Act, 1956, in relation to the Subsidiary Companies, subject to the consent of the Board of Directors and fulfillment of the other conditions specified in the said Circular.

The Board of Directors, in their meeting held on 27th November, 2012 has given its consent for not attaching the Balance Sheet of the subsidiary companies in terms of the said circular and accordingly, the documents mentioned in Section 212 of the Companies Act, 1956 relating to the Company''s Subsidiaries are not attached to the Accounts of the Company. In terms of the said Circular, your Company has fulfilled the prescribed conditions and has also made the necessary disclosures in the consolidated Balance Sheet and further undertakes that the Annual Accounts of the Subsidiary Companies and the related detailed information shall be made available to Shareholders of the Company and its Subsidiary Companies seeking such information. These documents will also be available for inspection during business hours at the Head/Corporate office of the Company and of the respective Subsidiary Companies.

AUDITORS

M/s. S.N. Dhawan & Co., Chartered Accountants, Auditors of the Company, retire at the ensuing Annual General Meeting and are eligible for re-appointment. The observations of the Auditors in their Report on Accounts read with the relevant notes to accounts are self-explanatory. PARTICuLARS OF EMPLOYEES Information in accordance with provisions of Section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975 as amended regarding employees is annexed to this Report as Annexure - D.

DIRECTORS'' RESPONSIBILITY STATEMENT

As required under Section 217 (2AA) of the Companies Act, 1956, (the Act) your Directors state that:

i. In the preparation of Annual Accounts for the year ended 30th September, 2012, the applicable accounting standards have been followed along with proper explanation relating to material departures;

ii. Accounting policies selected and applied are consistent and judgement and estimates made are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period;

iii. Proper and sufficient care has been taken 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; and

iv. The Annual Accounts have been prepared on a going concern basis.

PUBLIC DEPOSITS

The Company has not accepted/renewed any Fixed Deposit during the year. All Fixed Deposits which were due and claimed by the deposit holders have been paid on time. As on 30th September, 2012, 375 deposits aggregating to Rs. 0.75 crores matured but were not claimed. Subsequently, out of the above, 31 deposits of Rs. 0.07 crores have been repaid till the date of this report.

ACKNOWLEDGEMENT

Your Directors wish to thank the Customers, Dealers, Lenders, Financiers, Vendors, the Central and State Governments and employees for their continued support and commitment to the Company.

On behalf of the Board

RAJAN NANDA

Place: Faridabad Chairman &

Date: 27th November, 2012 Managing Director

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Sep 30, 2011

Dear Shareholders,

The Directors have pleasure in presenting the Sixty Sixth Annual Report for the financial year ended 30th September, 2011.

financial results

(Rs. Crores)



INCOME & PROFIT /(LOSS) year Ended year Ended 30.09.2011 30.09.2010

1. net Sales & Business Incomes 3,251.49 2,764.77

2. Total Expenses 3,076.96 2,533.47

3. Profit before Interest, Depreciation, 174.53 231.30 Amortisation & Exceptional Items (1-2)

4. Interest & Finance Charges 25.51 11.74

5. Cash Profit before Tax (3-4) 149.02 219.56

6. Depreciation & Amortisation 38.91 43.47

7. Profit/(Loss) before Tax & Exceptional 110.11 176.09 Items (5-6)

8. Exceptional Income/(Expense) 9.49 (11.93)

9. Tax & Deferred Tax (19.47) 50.47

10. Profit after Tax 120.09 137.55

Financial Performance

The net Revenue of the Company for the year was Rs. 3,251.49 crores as againstRs. 2,764.77 crores in the previous year showing a growth of 17.60 per cent. Sale of Tractors increased by 5.50 per cent to 63,420 from 60,086 in the previous year.

Earnings before Interest, Depreciation, Amortisation (EBITDA) stood at RS. 174.53 crores against Rs. 231.30 crores in the previous year.

Profit Before Tax (PBT) stood at Rs. 100.62 crores against Rs. 188.02 crores in the previous year and Profit After Tax (PAT) stood at Rs. 120.09 crores against Rs. 137.55 crores in the previous year. Earnings per share stands at Rs. 11.74 for the current year vis a vis Rs. 14.67 last year.

management discussion & Analysis

Management Discussion & Analysis (refer page 14 to 33) , which forms an integral part of this Annual Report; provides a more detailed analysis on the performance of individual businesses and their outlook.

dividend

your Directors are pleased to recommend a dividend @ 15 per cent i.e. Rs. 1.50 per Equity Share of Rs. 10 each for the year ended 30th September, 2011, payable to those Shareholders whose names appear in the Register of Members as on the Book Closure Date, subject to the approval of shareholders at the ensuing Annual General Meeting.

scheme of Arrangement & compromise

The Scheme of compromise and arrangement pending before the Hon'ble Delhi High Court (High Court) to bail out the Fixed Deposit Holders of Escorts Finance Limited stand disposed off vide order dated 4th March, 2011. On the interim direction of the High Court, fixed deposit liability of Rs. 130.32 crores has already been discharged by the Hardship Committee constituted under the direction of the High Court. For discharging the liability of unclaimed deposit holders, balance 2,401,050 Equity Shares of Escorts Limited, have been transferred to Escorts Benefit Trust (Trust) and the Hardship Committee has been dissolved. The Trust in due course and in terms of the direction of the High Court is discharging the unclaimed deposit holders as and when claimed by the deposit holders.

employee stock option scheme

Disclosure pursuant to the SEBI (Employees Stock Option Scheme and Employees Stock Purchase Scheme) Guidelines, 1999 is enclosed at Annexure-A and forms part of this Directors' Report for the year ended 30th September 2011.

directors

In accordance with the provisions of Companies Act, 1956 and Articles of Association of Company, Dr. M.G.K.Menon, Director retires by rotation at the ensuing Annual General Meeting of your Company, and being eligible, offers himself for re-appointment.

The Board of Directors, in their meeting held on 28th November, 2011, co-opted Mr. Hardeep Singh as an Additional Director on the Board of the Company. He shall hold office of Director up to date of ensuing Annual General Meeting. A notice under Section 257 of the Companies Act, 1956, proposing his candidature as Director at the ensuing Annual General Meeting of the Company, have been received.

Mr. nikhil nanda, has been re-appointed as Joint Managing Director for a further period of 5 years with effect from 19th September, 2012, subject to the approval of the shareholders in the ensuing Annual General Meeting.

The brief resumes and other details relating to the Directors who are proposed to be appointed/re-appointed, as required to be disclosed under Clause 49 of the Listing Agreement, forms part of the Report on Corporate Governance.

your Directors recommend the appointment/re-appointment of the above said Directors at the ensuing Annual General Meeting.

conservation of energy, technology Absorption, foreign exchange earnings And outgo

Information required under Section 217(1)(e) of the Companies Act, 1956 read with Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 is given in Annexure - B and forms an integral part of this Report.

corporate Governance

your Company reaffirms its commitment to the good corporate governance practices. Pursuant to Clause 49 of the Listing Agreement with the Stock Exchanges, Corporate Governance Report and Auditors' Certificate regarding compliance of conditions of Corporate Governance are enclosed at Annexure - C and forms an integral part of this report.

consolidated financial statements

Pursuant to Clause 32 and 50 of the Listing Agreement with Stock Exchanges, your Company has prepared Consolidated Financial Statements as per the Accounting Standards applicable to the Consolidated Financial Statements issued by The Institute of Chartered Accountants of India. Audited Consolidated Financial Statements along with the Auditors' Report are annexed with this Report.

subsidiary companies

The Ministry of Corporate Affairs (MCA), Government of India vide General Circular no. 2/2011 dated 8th February, 2011 has issued directions under Section 212(8) of the Companies Act, 1956 granting general exemption from the applicability of the provisions of Section 212 of the Companies Act,1956, in relation to the Subsidiary Companies, subject to the consent of the Board of Directors and fulfillment of the other conditions specified in the said Circular.

The Board of Directors, in their meeting held on 28th November, 2011 has given its consent for not attaching the Balance Sheet of the Subsidiary Companies in terms of the said circular and accordingly, the documents mentioned in Section 212 of the Companies Act, 1956 relating to the Company's Subsidiaries are not attached to the Accounts of the Company. In terms of the said Circular, your Company has fulfilled the prescribed conditions and has also made the necessary disclosures in the Consolidated Balance Sheet and further undertakes that the Annual Accounts of the Subsidiary Companies and the related detailed information shall be made available to Shareholders of the Company and its Subsidiary Companies seeking such information. These documents will also be available for inspection during business hours at the Head/Corporate office of the Company and of the respective Subsidiary Companies.

Auditors

M/s. S.n. Dhawan & Co., Chartered Accountants, Auditors of the Company, retire at the ensuing Annual General Meeting and are eligible for reappointment. The observations of the Auditors in their Report on Accounts read with the relevant notes to accounts are self-explanatory.

Particulars of employees

Information in accordance with provisions of Section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975 as amended regarding employees is annexed to this Report as Annexure - D.

directors' responsibility statement

As required under Section 217 (2AA) of the Companies Act, 1956, (Act) your Directors state that:

i. In the preparation of Annual Accounts for the year ended 30th September, 2011, the applicable accounting standards have been followed along with proper explanation relating to material departures;

ii. Accounting policies selected and applied are consistent and judgment and estimates made are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period;

iii. Proper and sufficient care has been taken 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; and

iv. The Annual Accounts have been prepared on a going concern basis.

Public deposits

The Company has not accepted/renewed any Fixed Deposit during the year. All Fixed Deposits which were due and claimed by the deposit holders have been paid on time. As on 30th September, 2011, 869 deposits aggregating to RS. 1.58 crores matured but were not claimed. Subsequently, out of the above, deposits of Rs. 0.08 crores have been repaid till the date of this report.

Acknowledgement

your Directors wish to thank the Customers, Dealers, Lenders, Financiers, vendors, the Central and State Governments and employees for their continued support and commitment to the Company.

On behalf of the Board

Sd/-

Place : Faridabad RAJAN NANDA

Date : 28th November, 2011 Chairman & Managing Director

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Sep 30, 2009

The Directors have pleasure in presenting the Sixty Fourth Annual Report for the Financial year ended 30,th September, 2009.

FINANCIAL RESULTS

Year Ended Year Ended 2009 2008

INCOME & PROFIT/(LOSS)

1. Net Sales & Business Incomes 2189.59 2051.55

2. Total Expenses 1982.15 1899.07

3. Profit before Interest, Depreciation, Amortisation & Exceptional Items (1 -2) 207.44 152.48

4. Interest & Finance Charges 51.54 55.93

5. Cash Profit before Tax (3-4) 155.90 96.55

6. Depreciation & Amortisation 49.15 51.01

7. Profit/(Loss) before Tax & Exceptional Items (5-6) 106.75 45.54

8. Exceptional lncome/(Expense) 4.31 (19.40)

9. Tax & Deferred Tax 21.33 14.97

10. Profit after Tax 89.73 11.87

The Company marginally improved its income by 6.7% during the year but a series of cost reduction initiatives led by over 6% reduction in material cost resulted in improved profitability with EBIDTA excluding other income up at 9.4% against 7.4% last year. Improved working capital management and overall debt reduction also resulted in reduced financial costs by 7.8%. Cash profit for the year improved significantly by over 61 % to Rs. 155.90 crores and Profit before Tax improved from Rs. 26.14 crores to Rs. 1 11.06 crores. Net Profit after Tax went up almost 8 times from Rs. 1 1.87 crores to Rs. 89.73 crores.

MANAGEMENT DISCUSSION & ANALYSIS

Management Discussion & Analysis (refer page 10 to 19) which forms an integral part of this Annual Report provides a more detailed analysis on the performance of individual businesses and their outlook.

DIVIDEND

Your Directors are pleased to recommend a dividend @10% i.e. Re. 1 per Equity Share of Rs. 10 each for the year ended 30 September, 2009, payable to those Shareholders whose names appear in the Register of Members as on the Book Closure Date, subject to the approval of shareholders at the ensuing Annual General Meeting.

BUSINESS RECONSTRUCTION RESERVE

In terms of the Scheme of Arrangement approved by the Honble High Court of Punjab & Haryana on 1 7 September, 2009 the Board of Directors of the Company have created a Business Reconstruction Reserve (BRR) by transferring amounts lying to the credit of Amalgamation Reserve, Capital Redemption Reserve, Revaluation Reserve and Share Forfeiture Reserve as on 1 "April, 2009. The Company has also revalued some fixed assets and the resultant difference in the value has also been transferred to the BRR. The Board has also approved the diminution/impairment/provisioning/write-offs of certain investments, fixed assets, doubtful debts & loans and advances, inventories, carry forward losses and other miscellaneous items from the BRR. The aggregate of the diminution/impairment/provisioning/write-offs etc. approved underthese heads is to the tune of Rs. 642.02 crores, for which BRR has been utilised as per the said Scheme.

SHARE CAPITAL

The Company has issued 3,611,612 Equity Shares of Rs. 10 each fully paid up at a price of Rs. 84.50 per share (including premium of Rs. 74.50 per share) in favour of the trustees of Escorts Employees Benefit & Welfare Trust under Employee Stock Option Scheme, 2006 on 9 November, 2009. Accordingly, the share capital of the Company has been increased to Rs. 94,32,11,080.

SCHEME OF COMPROMISE & ARRANGEMENT

Your Company had filed Scheme of Compromise & Arrangement ("Scheme") in the Honble High Court of Delhi to bail out fixed deposit holders of Escorts Finance Limited. The Scheme was approved by the Shareholders, Secured and Unsecured Creditors of your Company and the Fixed Deposit holders and Secured Creditors of Escorts Finance Limited on 1 0* May, 2006 and 5 May, 2006 respectively in the court convened meetings. The approval of the scheme by the court is still awaited. In compliance of the order of the High Court, Delhi, the Company has placed 34,04,256 shares of Rs. 32 crores at the disposal of Hardship Committee.

EMPLOYEE STOCK OPTION SCHEME

Disclosure pursuant to the SEBI (Employees Stock Option Scheme and Employees Stock Purchase Scheme) Guidelines, 1999 is enclosed at Annexure-A and forms part of the Directors Report for the year ended 30* September, 2009.

DIRECTORS

Mr. S.C. Bhargava, Director, retires by rotation at the ensuing Annual General Meeting of your Company, and being eligible, offers himself for reappointment.

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

Information required under Section 21 7(1) (e) of the Companies Act, 1 956 read with Companies (Disclosure of particulars in the Report of the Board of Directors) Rules, 1988 is given in Annexure- Band forms an integral part of this Report.

CORPORATE GOVERNANCE

Your Company reaffirms its commitment to good corporate governance practices. Pursuance to Clause 49 of the Listing Agreement with the Stock Exchanges, Corporate Governance Report and Auditors Certificate regarding compliance of conditions of Corporate Governance are enclosed at Annexure - C and forms an integral part of this report.

CONSOLIDATED FINANCIAL STATEMENTS

Pursuant to Clause 32 and 50 of the Listing Agreement with Stock Exchanges, your Company has prepared Consolidated Financial Statements as per the Accounting Standards applicable to the Consolidated Financial Statements issued by The Institute of Chartered Accountants of India. Audited Consolidated Financial Statements along with the Auditors Report are annexed with this Report.

SUBSIDIARY COMPANIES

During the year under report, the Company has disinvested its entire equity and preference shareholdings in Cellnext Solutions Ltd. Accordingly, Cellnext Solutions Ltd. is no longer a subsidiary of the Company.

The Honble High Court of Punjab & Haryana has approved the Scheme of Arrangement between Escorts Agri Machinery Inc. (EAMI), a wholly owned Subsidiary of the Company in USA and the Company vide its Order dated 17 September, 2009. The necessary formalities for the merger with Secretary of State of Delaware, USA have also been completed. Accordingly, EAMI has merged into the Company.

The Company has filed an application with the Central Government for exemption from attaching Annual Accounts and other documents in respect of its subsidiaries to the Annual Report of the Company for the year ended 30* September, 2009 and the approval of the Central Government on the same is being obtained.

Accordingly, statement in respect of each of the subsidiary, giving the details of capital, reserves, total assets and liabilities, details of investments, turnover, profit before taxation and proposed dividend is attached to the consolidated balance sheet.

The Annual Accounts of the subsidiary companies and the related detailed information will be made available to the holding and subsidiary company investors, seeking such information and will also be available for inspection at the Corporate Office of the Company.

AUDITORS

M/s. S.N. Dhawan & Co., Chartered Accountants, Auditors of the Company, retire at the ensuing Annual General Meeting and are eligible for reappointment. The observations of the Auditors in their Report on Accounts read with the relevant notes to accounts are self-explanatory.

PARTICULARS OF EMPLOYEES

Information in accordance with provisions of Section 21 7(2A) of the Companies Act, 1 956 read with the Companies (Particulars of Employees) Rules, 1 975 as amended regarding employees is annexed to this Report as Annexure- D.

DIRECTORSRESPONSIBILITY STATEMENT

As required under Section 217 (2AA) of the Companies Act, 1956, (Act) your Directors state that:

i. In the preparation of Annual Accounts for the year ended 30lh September, 2009, the applicable accounting standards have been followed along with proper explanation relating to material departures;

ii. Accounting policies selected and applied are consistent and judgement and estimates made are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period;

iii. Proper and sufficient care has been taken 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; and

iv. The Annual Accounts have been prepared on a going concern basis.

PUBLIC DEPOSITS

The Company has not accepted/renewed any Fixed Deposit during the year. All Fixed Deposits which were due and claimed by the deposit holder have been paid on time. 1453 Fixed Deposits aggregating to Rs. 2.63 crores were unclaimed as on 30* September, 2009. Subsequently, out of the above, 8 deposits of Rs. 0.01 crores have been repaid till date.

ACKNOWLEDGEMENT

Your Directors wish to thank the Customers, Dealers, Lenders, Financiers, Vendors, the Central and State Governments and employees for their continued support and commitment to the Company. On behalf of the Board

Sd/- Place : New Delhi RAJAN NANDA

Date : 27th December, 2009 Chairman & Managing Director