MAHINDRA & MAHINDRA LIMITED
It has been a long rough road over the last financial year.
In 2008 the River Kosi changed its course. Hurricane Ike
hit the US. There were floods in Assam, Bihar and
Bangladesh. China experienced a massive earthquake. And
seemingly in rhythm with these natural cataclysms, the
world saw a cataclysm on Wall Street, the collapse of the
mortgage market, respected banks failing, once mighty
companies collapsing, and even governments teetering on
the brink of bankruptcy. India was not exempt from the
effects of this global upheaval and neither was M&M. In
the face of such sweeping change, such serious uncertainty,
how does a company cope?
We chose to treat the crisis as a ‘Bardo’ moment. In the
words of a philosopher “Bardo is a Tibetan word meaning
transition or a gap between the completion of one situation
and the onset of another… One of the central
characteristics of bardos is that they are periods of deep
uncertainty...But if you look deeply at it you will see that
its very nature creates gaps, spaces in which chances and
opportunities for transformation are continuously flowering
– if, that is, they can be seen and seized”
The description seemed eerily apt. We seemed to be at the
end of a longish period of record profits and almost
effortless growth. We were facing the onset of a new
situation of economic slowdown, consumer cutbacks and
deep uncertainty. A wide chasm yawned between the
success of the past and the bleakness of the future. How
could we “see and seize” the opportunity for transformation
in this deeply unsettling Bardo moment? We decided that
the path to seizing opportunity was threefold. We would
Reboot, Reinvent and Reignite.
When our computers hang, all of us have learned to reboot
them. To start again. To go back to fundamentals. Similarly,
in M&M we spent much of the year rebooting, questioning
everything we did and seeing if we could do it better
cheaper or differently. There was a focus on reengineering
costs and increasing free cash flow, which contributed to
the creditable results we were able to declare at the end
of the year.Next, we decided to leverage our talent for
frugal engineering to reinvent ourselves in many ways large
and small. At the macro end of the scale we concentrated
on producing the Xylo, a product that gave such astounding
features at such a reasonable price that it rendered the
recession irrelevant. At the micro end we focused on grass
roots innovation to do things better. To give just one
example, the team implementing the new factory at
Chakan was challenged to redesign pallets used in the
factory to reduce the cost by half without compromising
functionality. They succeeded in reducing costs not by 50%
but by 65 %! And they improved the functionality as well.
The ripple effects of these savings across factories and
over the years will have an impact for a long long time. So
opportunities for improvement and reinvention flowered
in the time of crisis.
And finally we decided that a crisis was not a time to
forget our dreams – rather it was a time to reignite them.
So we held fast to our dreams and, at the height of the
economic pessimism, launched the Xylo. It turned out to
be a game changing move which revived the entire Indian
automobile market. We held fast to our dreams and to
our belief that a bardo moment always holds the seeds of
opportunities which have to be seen and seized – and
reaped the dividends.
We have learned that a crisis is calamitous only if it is
wasted. Otherwise it is a blessing. As the cover picture
shows, we have learned that we are capable of moving
forward no matter how hard and rocky the road. We have
learned that difficult terrain is not an obstacle to reaching
for the summit. And we have learned that by rebooting,
reinventing and reigniting our dreams we can steer our
way to a brighter future.
 MAHINDRA & MAHINDRA LIMITED

COMMITTEES OF THE BOARD BOARD OF DIRECTORS

Keshub Mahindra
Audit Committee
Chairman
Deepak S. Parekh
Anand G. Mahindra
Chairman Vice-Chairman & Managing Director
Nadir B. Godrej
Deepak S. Parekh
M. M. Murugappan
Nadir B. Godrej
R. K. Kulkarni
M. M. Murugappan

Share Transfer and Shareholders/ Narayanan Vaghul

Investors Grievance Committee A. S. Ganguly
Keshub Mahindra R. K. Kulkarni
Chairman Anupam Puri
Anand G. Mahindra Arun Kanti Dasgupta
Bharat Doshi Nominee of Life Insurance Corporation of India
A. K. Nanda Bharat Doshi
Executive Director
R. K. Kulkarni
A. K. Nanda
Executive Director
Remuneration/Compensation Committee
Narayanan Vaghul GROUP MANAGEMENT BOARD
Chairman
Anand G. Mahindra
Keshub Mahindra Vice-Chairman & Managing Director
Nadir B. Godrej Bharat Doshi
M. M. Murugappan Group Chief Financial Officer
A. K. Nanda
President - Infrastructure Development Sector
Loans & Investment Committee
Anjanikumar Choudhari
Keshub Mahindra President – Farm Equipment Sector
Chairman Rajeev Dubey
President – HR, After – Market & Corporate Services
Anand G. Mahindra
Pawan Goenka
Bharat Doshi President – Automotive Sector
A. K. Nanda Hemant Luthra
R. K. Kulkarni President – Systems & Techonologies Sector
Anoop Mathur
President – Two-Wheeler Sector
Research & Development Committee
Uday Y. Phadke
A. S. Ganguly President - Finance, Legal and Financial Services Sector
Chairman Ulhas N. Yargop
Anand G. Mahindra President – Information Technology Sector
Nadir B. Godrej
M. M. Murugappan Narayan Shankar
Bharat Doshi Company Secretary

1
Contents
Directors’ Report ..................................................................................................... 3
Management Discussion and Analysis .................................................................. 29
Corporate Governance .......................................................................................... 47
Sustainability ......................................................................................................... 68
Accounts ............................................................................................................... 73
Statement pursuant to Section 212 ................................................................... 127
Consolidated Accounts ....................................................................................... 131

Bankers
Bank of America N.A.
Bank of Baroda
Bank of India
Canara Bank
Central Bank of India
HDFC Bank Limited
Standard Chartered Bank
State Bank of India
Union Bank of India

Auditors
Deloitte Haskins & Sells
12, Dr. Annie Besant Road, Opp. Shiv Sagar Estate,
Worli, Mumbai 400 018.

Advocates
Khaitan & Co., Meher Chambers,
R K Marg, Ballard Estate, Mumbai 400 001.

Registered Office
Gateway Building, Apollo Bunder, Mumbai 400 001.

Branches
7, Dr. Ishaque Road (Old KYD Street), Kolkata 700 016.
Mahindra Towers, 2-A Bhikaji Cama Place, New Delhi 110 066.
Mahindra Towers, First Floor, 17/18, Pattulous Road, Chennai 600 002.
Raheja Chambers, First Floor, 12, Museum Road, Bengaluru 560 001.

2
 MAHINDRA & MAHINDRA LIMITED

Directors’ Report
Dear Shareholders
Your Directors present their Report together with the The year under review was an extremely trying one. The
audited accounts of your Company for the year ended market place witnessed unprecedented turbulence in the
st
31 March, 2009. wake of the Global Financial meltdown. A runaway inflation

Financial Highlights touching a high point of 12% early in the year, the tight
(Rs. in crores) monetary policies followed by the authorities for most of
2009 2008 the year to control inflation with the consequent high
Gross Income 14983 13238 interest rates, the precipitous fall in the value of the Rupee
Less: Excise Duty on Sales (Net) 1619 1566 by 26% during the year and weak consumer demand all
Net Income 13364 11672
led to an extremely challenging environment in which the
Profit before Depreciation, Interest,
Exceptional items and Taxation 1363 1497 Company had to operate. Despite these daunting
Less: Depreciation/Amortisation 292 239 conditions, the net income of the Company grew by 14.5%
Profit before Interest, Exceptional
items and Taxation 1071 1258 to 13,364 crores in the year under review from Rs.11,672
Less: Interest (Net) 45 24 crores in the financial year 2008. However, the difficult
Profit before Exceptional items and global economic climate of the year exerted considerable
Taxation 1026 1234
Add: Exceptional items 10 173 pressure on the Company and the profit after tax for the
Profit before Taxation 1036 1407 current year was Rs.837 crores against Rs.1,103 crores for
Less: Provision for Tax – Current the previous year.
Tax (including Fringe Benefit Tax) 58 279
Less: Provision for Tax – Deferred Dividend
Tax (Net) 141 25
Profit for the year 837 1103 Your Directors are pleased to recommend a dividend of
Add: Profit of Mahindra Holdings Rs.10 per Equity Share, payable to those Shareholders
& Finance Limited for the period
1st February, 2008 to 31st March, 2008 31 - whose names appear in the Register of Members as on
Balance of profit for the year 868 1103 the Book Closure Date. In recognition of the difficult
Balance of profit for earlier years 2775 2125 economic climate in which the Company operated during
Add: Amount transferred on
Amalgamation of Mahindra the year, a small reduction is being made in the proposed
Holdings & Finance Limited 160 - dividend as compared to the dividend of Rs. 11.50 per
Less: Transfer from Debenture
Redemption Reserve 30 17 Equity Share paid in the previous year. Also the proposed
Profits available for appropriation 3773 3211 dividend will be paid on a slightly enlarged capital base of
Less: Transfer to General Reserve 100 115 Rs.278.82 crores (as against Rs. 245.74 crores in the
Credit of Income-tax on Proposed
Dividend of Previous Year (4) - previous year). The equity dividend outgo for the financial
Proposed Dividend 279 283 year 2008-09, inclusive of tax on distributed profits (after
Income-tax on Proposed Dividend 33 38 reducing the tax on distributed profits of Rs.14.15 crores
Balance carried forward 3365 2775
payable by the subsidiaries on the dividends receivable

3
from them during the current financial year) would absorb
a sum of Rs.312.06 crores (as against Rs.321.09 crores
comprising the dividend of Rs.11.50 per Equity Share paid
for the previous year).
Automotive Sector:
The global economic downturn and softening of growth
in the Indian economy had an adverse impact on the Indian
automotive industry due to strong linkages of the industry
with the economy and the Company took corrective steps
to align the Company’s production to reduced demand
accordingly.
A total of 1,81,842 vehicles and 43,278 three-wheelers
were produced as against 2,00,132 vehicles and 34,556
three-wheelers in the last year. These include 8,723 light
commercial vehicles (LCVs) and 14,404 cars (previous year
11,079 LCVs and 26,653 cars) manufactured and supplied
to two of the Company’s subsidiaries viz. Mahindra Navistar
Automotives Limited (MNAL) and Mahindra Renault Private
Limited (MRPL).
Your Company recorded total sales of 1,61,882 vehicles
and 44,806 three-wheelers as compared to 1,61,001
vehicles and 34,076 three-wheelers in the previous year
registering a growth of 0.5% and 31% in vehicle sales and
three-wheeler sales respectively.
The domestic sales volume of 1,53,654 vehicles [includes
1,53,653 Multi Utility Vehicles (MUVs) and 1 LCV] was
higher by 3.3% than the previous year’s volume of 1,48,791
vehicles (includes 1,48,761 MUVs and 30 LCVs) and the
domestic sales volume of 44,533 three-wheelers was higher
by 31.3% than the previous year’s volume of 33,927 three-
wheelers. The Company’s domestic MUV sales volume grew
by 3.3% as against the industry MUV sales de-growth of
7.4%. In the process, your Company strengthened its
dominant position in the domestic MUV segment by
increasing its market share to 57.2% over the previous
year’s market share of 51.3% - the highest since fiscal 2000.
4
The Bolero Brand once again demonstrated its popularity
by registering a significant growth over the previous year.
It remains India’s largest selling MUV brand for the fourth
consecutive year.
The Company’s exports were severely impacted by the
global downturn. During the year under review, your
Company exported 8,501 vehicles [including 693 LCVs
sourced from MNAL and 273 three-wheelers] as compared
to the exports of 12,359 vehicles [including 363 LCVs
sourced from MNAL and 149 three-wheelers] in the
financial year 2008 registering a de-growth of 31%.
Spare parts sales for the year stood at Rs.362.7 crores
(Exports Rs.27 crores) as compared to Rs.388.3 crores
(Exports Rs.39.9 crores) in the previous year.
Farm Equipment Sector:
The financial year ending March, 2009 saw the merger of
erstwhile Punjab Tractors Limited (PTL) with your Company,
with effect from 1st August, 2008, the Appointed Date of
the merger. The merger became effective from
16th February, 2009 and from the said date it operates as
a part of the Farm Equipment Sector of your Company, as
its Swaraj Division. Therefore, the current year business
figures of your Company include PTL’s financials for the
period from 1st August, 2008 to 15th February, 2009. During
the year under review, your Company achieved a production
of 1,19,098 tractors compared to 98,917 tractors in the
previous year. In addition, 52,131 engines were produced
for Mahindra Powerol Brand compared to 32,072 engines
last year. Following the merger, the two tractor
manufacturing plants of the erstwhile PTL at Mohali and
Chappercheri along with its foundry facility at Sialba Majri,
near Mohali, stands added to the existing tractor
manufacturing plants of your Company at Rudrapur,
Nagpur, Kandivali and Jaipur.
For the financial year ending on March, 2009, your
Company recorded sales of 1,20,202 tractors as against

99,042 tractors sold in the previous year. This included
domestic tractor sales of 1,13,269 tractors as compared
to domestic sales of 90,509 tractors in the previous year,
recording a growth of 25.1%. This performance should
be considered against the backdrop of an almost flat
industry (+0.6%), faced with the impact of: a) liquidity
crunch following the global economic crisis b) stringent
lending norms for farm loans due to higher NPA’s and c)
high interest rates prevalent throughout the year. The sharp
rise in raw material prices in the first half of the year and
the consequent price increases by all tractor manufacturers’
also impacted demand.
As a result of the merger of the erstwhile PTL, your
Company has firmly established its dominance in the Indian
tractor industry, ending the financial year 2009 with a
market share of 40.8%, compared to a market share of
29.8% in the previous financial year. This is the 26th
consecutive year of leadership in the Indian tractor industry.
The global economic crisis and the subsequent impact on
economies across the globe, including adverse changes in
some international currencies had a negative impact on
exports from India, including tractors. As a result, this year
your Company exported 6,933 tractors, registering a de-
growth of 19%, as compared to 8,533 tractors exported
last year.
In the farm mechanisation space beyond tractors, your
Company sells farm implements and other equipments.
The Swaraj Division Plant at Chappercheri is an established
manufacturer of harvester combines in the organised Sector
in India.
Beyond the Agri space, under the Mahindra Powerol Brand,
your Company sold 52,350 engines and gensets in this
financial year, as against 31,922 engines and gensets last
year - a growth of 64%. With this performance, your
Company retained its leadership position in the genset
market catering to the telecom space, while strengthening
its presence in the retail segment.
MAHINDRA & MAHINDRA LIMITED
Mahindra Defence Systems Division (MDS):
With the opening up of the Defence Sector for Private
Sector participation in February, 2001, your Company
constituted a separate Division viz. MDS to pursue a wide
range of Defence Sector activities.
Your Company provides world class armouring solutions
for light combat vehicles and Sports Utility Vehicles (SUVs)
as well as high mobility vehicles for defence, police and
paramilitary use.
During the financial year 2009, your Company has
commenced operations at the newly commissioned
Mahindra Special Military Vehicles (“MSMV”) facility at
Prithla, near Faridabad in Haryana. This is the first such
dedicated defence vehicle facility in the private sector in
India and is designed to provide up-armoured and high
mobility vehicles to the armed forces, police and para-
military forces. Currently, the Plant has an annual capacity
of 500 such vehicles and during the financial year 2010
this capability is likely to be expanded further.
In its endeavor to continuously offer technologically better
and a wider range of products to the defence forces, your
Company has established a Product Development Centre
at MSMV. Based on work carried out in the Product
Development Centre, product improvements have been
effected in the Bullet Proof Scorpio and Rakshak. The
Product Development Centre has carried out development
of the AXE high mobility vehicle, Marksman and Light
Bullet Proof Vehicle based on the specifications of various
Government customers. These products have been procured
by all the State Governments who are facing problems of
insurgency and militancy.
Currently, MDS is engaged in two lines of Defence
Businesses (a) Land Systems and (b) Naval Systems.
Your Company through MDS has obtained licenses from
the Government of India to manufacture a wide range of
5
products which include light armored vehicles, weapon
effect simulators, platforms for surveillance sensors and
sea mines for the Navy. Through these initiatives, your
Company has positioned itself to play a major role in the
Indian Defence Sector for the manufacture and integration
of weapon systems and platforms. Your Company has been
exploring opportunities for partnerships with companies
equipped with globally proven high end defence
technologies and willing to invest in India on a long term
basis.
With this objective, your Company is evaluating various
options and identifying possibilities for forming separate
joint ventures/alliances with strategic partners for carrying
on both the Land Systems and Naval Systems Businesses
respectively. Accordingly, your Company had proposed to
transfer Land Systems and Naval Systems Businesses of
MDS together with congeries of rights of the Company in
such businesses, to two separate subsidiaries of the
Company. In terms of section 293(1)(a) of the Companies
Act, 1956 (“the Act”) and in terms of section 192A of the
Act read with Clause 4(f) of the Companies (Passing of the
Resolution by Postal Ballot) Rules, 2001, approval of the
Shareholders was obtained by means of a Postal Ballot.
Currently, the Company is in the process of transferring
these Businesses into two separate subsidiaries.
Profits:
The Profit for the year before Depreciation, Interest,
Exceptional items and Taxation was Rs.1,362.97 crores as
against Rs.1,496.94 crores in the previous year, a decline
of 8.95%. Profit after tax after considering the profits
earned by the erstwhile Mahindra Holdings & Finance
Limited for the period 1st February, 2008 to 31st March,
2008 was Rs.867.51 crores as against Rs.1,103.37 crores
in the previous year, a decline of 21.38%. Your Company
continues with its rigorous cost restructuring exercises and
efficiency improvements which have resulted in significant
6
savings through continuous focus on cost controls, process
efficiencies and product innovations that exceed customer
expectations in almost all areas thereby enabling the
Company to take full advantage of the recovery in the
economy, as and when it happens.
Management Discussion and Analysis Report
A detailed analysis of the Company’s performance is
discussed in the Management Discussion and Analysis
Report, which forms part of this Annual Report.
Corporate Governance
Your Company is committed to transparency in all its
dealings and places high emphasis on business ethics.
During the year, your Company received the National Award
for Excellence in Corporate Governance from The Institute
of Company Secretaries of India, highlighting the good
Corporate Governance systems and practices adhered to
by the Company. During the year, CRISIL has re-affirmed
the highest level rating, (Level 1) for Governance and Value
Creation for the third year in a row. This rating indicates
that the capability of the Company with respect to wealth
creation for all its stakeholders while adopting strong
Corporate Governance practices is the highest. A Report
on Corporate Governance along with a Certificate from
the Statutory Auditors of the Company regarding the
compliance of conditions of Corporate Governance as
stipulated under Clause 49 of the Listing Agreement forms
part of the Annual Report.
Issue of Shares upon Amalgamations
During the year, two subsidiaries of the Company viz.
erstwhile Mahindra Holdings & Finance Limited (MHFL)
and erstwhile Punjab Tractors Limited (PTL) got
amalgamated with the Company; the details whereof are
given elsewhere in this Report.
Pursuant to the Scheme of Amalgamation of MHFL with
Mahindra and Mahindra Limited and their respective

Shareholders (MHFL – M&M Scheme), 5,13,10,208 equity
shares held by the Company in MHFL stood vested in the
Trustees of the M&M Benefit Trust. Upon the MHFL –
M&M Scheme becoming effective, 1,28,27,552 Ordinary
(Equity) Shares of Rs.10 each of the Company were allotted
to the Trustees of M&M Benefit Trust in the Share Exchange
Ratio of 1 Ordinary (Equity) Share of Rs.10 each fully paid-
up in the capital of the Company in respect of every 4
equity shares of Rs.10 each fully paid-up in the equity
share capital of the erstwhile MHFL on the Effective Date.
Pursuant to the Scheme of Amalgamation of PTL with
Mahindra and Mahindra Limited and their respective
Shareholders (PTL – M&M Scheme), all the equity shares
held by the Company in PTL vested in the Trustees of the
M&M Benefit Trust. Subsequently, upon the PTL – M&M
Scheme becoming effective:
a) 2,02,45,395 Ordinary (Equity) Shares of Rs.10 each of
the Company were allotted to the Shareholders of the
erstwhile PTL whose names appeared in the Register
of Members as on 4th March, 2009, being the Record
Date fixed for this purpose, in the Share Exchange
Ratio of 1 Ordinary (Equity) Share of Rs.10 each fully
paid-up in the capital of the Company in respect of
every 3 equity shares of Rs.10 each fully paid-up in
the equity share capital of the erstwhile PTL, and
b) 6,505 Ordinary (Equity) Shares of Rs.10 each of the
Company were allotted to the Trustees of M&M
Fractional Entitlements Trust set up pursuant to the
Scheme, against 19,515 equity shares of Rs.10 each
fully paid-up in the equity share capital of the erstwhile
PTL being the aggregate of all the fractional
entitlements of various Shareholders of the erstwhile
PTL.
Upon both the MHFL – M&M Scheme and the PTL – M&M
Scheme becoming effective, the issued, subscribed and
paid-up Share Capital of the Company post allotment of
MAHINDRA & MAHINDRA LIMITED
Shares as aforesaid stands at Rs.278.82 crores comprising
of 27,88,21,265 Ordinary (Equity) Shares of Rs.10 each
fully paid-up and the Authorised Share Capital of the
Company stands at Rs.625 crores comprising of
60,00,00,000 Ordinary (Equity) Shares of Rs.10 each and
25,00,000 Unclassified Shares of Rs.100 each.
Finance
The financial year 2009 has been a very challenging year
for corporates in the wake of the unprecedented global
financial crisis. The financial markets world wide faced
massive falls in equity values, collapse of fixed income
markets, liquidity crunch and huge foreign exchange
fluctuations. All Banks resorted to credit freeze which was
a major action that posed a major challenge to operations
of companies. Inspite of it being a very tough year for all
the companies across the globe and in India, your Company
has successfully managed its cash flows efficiently and
preserved its credit lines to maintain a comfortable liquidity
position. The Bankers continue to rate your Company as a
prime customer and extend facilities/services at prime rates.
During the year, your Company has successfully accessed
both domestic and overseas capital markets with diverse
instruments, maturities and interest rates to part finance
its requirements.
In the domestic market, your Company raised Rs.400 crores
by way of private placement of Secured, Non-Convertible
Redeemable Debentures (“NCDs”) with an average maturity
of 6 years. Your Company managed to raise the NCDs at
highly competitive rates inspite of there being a severe
credit freeze and liquidity crunch in the market. ICRA
Limited has assigned a “LAA+” rating to these NCDs
indicating high credit quality.
In the last year’s Directors Report, details were mentioned
about the Company’s successful offering of Rs.700 crores
comprising of 93,95,974 Unsecured Fully and Compulsorily
7
Convertible Debentures (“FCD”), each FCD having a face
value of Rs. 745 and convertible into one Equity Share of
Rs. 10 each in the Company at a price of Rs. 745 per
Share at anytime within 18 months from the date of
allotment of the FCD at the option of the Investor and
mandatorily convertible into Equity Shares on the date
falling 18 months from the date of allotment. These FCD
were issued in July, 2008 after the funds were received.
During the year, Reserve Bank of India (“RBI”) announced
a Scheme granting general permission to issuers of Foreign
Currency Convertible Bonds (“FCCBs”) to buyback the
FCCBs, subject to certain parameters. Your Company was
amongst the first few to avail of this opportunity. To date,
the Company has bought back 105 FCCBs of face value of
USD 1,00,000 aggregating USD 10.50 million. The FCCBs
bought back were part of the USD 200 million outstanding
FCCBs issued in the financial year 2006. Your Company
also raised Unsecured External Commercial Borrowings
(ECB), at competitive cost to re-finance the buyback.
Your Company follows a prudent financial policy and aims
to maintain optimum financial gearing at all times.
The Company’s total Debt to Equity Ratio was 0.56 as at
31st March, 2009.
Your Company has been rated by CRISIL, ICRA Limited
(ICRA) and Credit Analysis & Research Limited (CARE) for
its banking facilities under Basel II norms.
During the year, CRISIL has assigned a rating of “AA/
Negative Outlook” for Long Term banking facilities. This
has been revised from the earlier rating of “AA+/Negative
Outlook”. CRISIL’s rating indicates high safety on timely
payment of financial obligations. The revision is a reflection
of the significant impact of the weakening business
environment on the revenues and profitability of your
8
Company’s Automotive and Tractor businesses as also
CRISIL’s estimate of your Company’s financial risk profile in
view of the ongoing capital expenditure plans.
ICRA and CARE have maintained a Long Term Rating of
‘LAA+’ and ‘CARE AA+’ respectively. CRISIL, ICRA and
CARE have all assigned the highest rating for your
Company’s Short Term facilities.
Stock Options
On the recommendation of the Remuneration/
Compensation Committee of your Company, the Trustees
of the Mahindra & Mahindra Employees’ Stock Option
Trust have granted 26,34,363 Stock Options to Eligible
Employees during the year under review.
Details required to be provided under the Securities and
Exchange Board of India (Employee Stock Option Scheme
and Employee Stock Purchase Scheme) Guidelines, 1999
are set out in Annexure I to this Report.
Industrial Relations
Industrial Relations remained cordial and harmonious
throughout the year. The Management Discussion and
Analysis Report gives an overview of the developments in
Human Resources/Industrial Relations during the year.
Subsequent to the year end, the workmen at the Nashik
Plant of the Automotive Sector of the Company resorted
to an illegal tool down strike in response to a disciplinary
action initiated against an office bearer of the Employee’s
Union for alleged acts of indiscipline. The aforesaid illegal
strike temporarily affected the production at the Nashik
Plant. The Nashik Industrial Court, by its Order dated 13th
May, 2009, has declared the tool down strike by workmen
at the Nashik Plant as illegal and unjustified. The Employee’s
Union has withdrawn its strike with effect from 18th May,
2009 and production has resumed in the Nashik Plant of
the Company and normalcy restored.

Safety, Health and Environmental Performance
Your Company has always demonstrated its strong
commitment and responsibility towards Safety,
Occupational Health and Environment which stems from
its Vision and enjoins upon the Company to sustain business
growth with deep commitment towards Safety,
Occupational Health and Environment.
Health and Safety
Your Company has a well established Safety, Occupational
Health & Environmental Policy (SH&E) which is revised under
EMS & OHSMS Standard for all the locations of the
Automotive Sector.
The SH&E Policy inter alia ensures safety of public,
employees, plant, equipment and business associates,
ensuring compliance with all statutory rules and regulations
on a monthly basis, imparting training to its employees
and business associates as per the Training Calendar,
carrying out Statutory safety audits of its facilities as per
legal requirements, conducting regular medical check-ups
of its employees and promoting eco-friendly activities.
Various initiatives on Safety including Safety Promotions,
Safety Patrol Rounds, Safety and Surveillance Audits, Safety
Training with focus on behaviour based safety, Safety
Kaizens, reporting of near-miss incidents are encouraged
to resolve safety issues. Special initiatives such as emergency
mock drills and upgradation of Fire Protection
Systems have been carried out thereby improving
Safety Performance. Your Company’s Plants continue to
strive to achieve “Accident Reduction” in all its units
ensuring a safety culture throughout all levels of the
organisation.
Certifications
ISO 14001:2004 provides a framework for the Company’s
Automotive Sector’s environmental initiatives, objectives
MAHINDRA & MAHINDRA LIMITED
and targets that helps in continually improving its
environmental performance. All Plants of the Automotive
Sector have been certified with the amended standard for
Environmental Management System ISO 14001: 2004.
Further, implementation of OHSMS Standard has reinforced
the Company’s commitment of Safety and Occupational
Health to highest levels. OHSAS 18001:2007 are the existing
best safety practices and are implemented through the
amended management system and all Plants of the
Automotive Sector have been certified during the year
2008-09.
Likewise, Surveillance Audits of OHSAS 18001 and ISO
14001 at select plants of the Tractor Division have also
been completed.
Ensuring compliance
The focus on statutory compliance in your Company is
based on robust internal and external auditing systems
through Integrated Management Systems which dwell upon
legal and other requirements. The evaluation of compliance
is reviewed periodically through monitoring and
measurement schedules.
Your Company continued its commitment to improve the
well being of its employees by conducting curative,
preventive and specialised medical check-ups. Employees
have also been educated with advisories on industrial and
personal hygiene and safety performance at the work place.
Safety Performance
Keeping Safety as a key factor, the Central Safety Committee
of the Mahindra Group was formed by the Mahindra Group
Management Board. With a view to enhance the
performance of each Sector from within the Group, the
overall safety performance is reviewed periodically under
the guidance of a Chairman nominated from the Senior
Management.
9
With the help of Behavioural Based Safety (BBS)
implementation, the Company’s Plants continue to strive
to eliminate accidents in its units.
External Safety Audits
Mahindra Manufacturing Excellence Award for Safety,
Health & Environmental activities for the year 2008-09 has
been assessed by an external agency to confirm the rating
of each Plant and the Company’s best safety practices and
systems are shared and implemented for horizontal
deployment.
Environmental Initiatives
Air Pollution Management:
With a clear focus on the need for a clean environment,
the Company is now in the process of calculating carbon
foot print and taking adequate measures to mitigate the
causes. The Company has taken steps to reduce green
house emissions through workplace air monitoring, effluent
treatment, waste monitoring and volatile organic carbon
monitoring. All Plants of the Tractor Division have
successfully undergone first Sustainability Audit conducted
by Ernst & Young. Your Company is constantly imbibing
the major environment sensitisation drives amongst its
employees through various events and training programs
such as celebration of World Environment Day, Energy
Conservation Month and increased green zones.
Water and Waste Water Management:
The Company has taken various initiatives to achieve waste
reduction and is committed towards resource conservation
through various water management methods, recycling
and re-use of treated waste water in process, revised water
portability monitoring, rainwater harvesting and recharging
within plant premises.
10
Solid Waste Management:
Your Company is committed towards responsible disposal
of hazardous and non-hazardous waste. While generation
of waste to a great extent has been reduced at source, the
same if adaptable is recycled and reused. The Company is
aggressively working towards minimising the waste disposal
cost and is executing various management programmes at
all its locations i.e. vermiculture, bio-gas Plant to convert
food waste to manure/cooking gas, etc. The Company
also ensures environment friendly disposal of hazardous
e-waste.
Greenbelt Development:
Your Company partners with Non-Government
organisations and academic institutions at various Plant
locations for green belt development and Mahindra Hariyali
is one such initiative.
Corporate Social Responsibility
The Indian economy today is undoubtedly feeling the effects
of global recessionary trends. The resultant downturn in
economic activity is often likely to hit hardest, those people
and communities that are already vulnerable. The need of
the hour is to therefore continue to give high priority to
these disadvantaged communities. Keeping with the
Company’s core value of Good Corporate Citizenship, the
Mahindra Group continues to display its social responsibility
by directing 1% of its profit after tax (“PAT”) to Corporate
Social Responsibility (“CSR”) initiatives which would benefit
the socially and economically disadvantaged sections of
society.
Some of the major initiatives in which the Company has
invested in are described below:
Mahindra Pride School:
The Mahindra Pride School at Chinchwad near Pune,
provides livelihood and skills training to youth from socially

disadvantaged communities (comprising mainly of
Scheduled Caste/Scheduled Tribe youth). Since its
establishment on 23rd March, 2007, 1,202 students have
been imparted with “employable” skills through a training
course of 3 months duration. The School provides training
in four faculties i.e. Hospitality Craft, Customer Relationship
Management, Hardware and Networking and Call Centre
Training. All students also undergo mandatory courses in
English, Life skills and Computer Applications. There has
been 100% placement of the students participating in the
placement process with starting monthly salaries ranging
from Rs.4,500 to Rs.15,000.
The Mahindra Group has also entered into a Memorandum
of Understanding with the Government of Rajasthan in
April, 2008, to construct the second Mahindra Pride School
in Jaipur, Rajasthan. It is now awaiting the handover of
2,500 sq. mtrs. of land offered by the Government of
Rajasthan, to proceed with construction of the School
building.
Mid Day Meal Kitchen:
Honorable Ex-Chief Minister of Rajasthan Smt. Vasundhara
Raje, inaugurated the centralised Mid Day Meal Kitchen
th
set up by the Company on 20 September, 2008. The Mid
Day Meal Kitchen at Govindgarh Block, Jaipur District,
Rajasthan, is a result of an unique tripartite agreement
between the Company, Government of Rajasthan and
Naandi Foundation with the prime objective being “to fight
hunger in Schools”. This centralised Mid Day Meal Kitchen
ensures that high quality, hygienically prepared Mid Day
Meals containing a minimum of 450 calories are served to
the children. The Company has spent Rs.1 crore, for setting
up of this central kitchen, which today feeds over 25,000
school children from Class 1 to 5, covering 314 schools in
two blocks of Chomu and Govindgarh, thereby making
schooling and learning a complete experience.
MAHINDRA & MAHINDRA LIMITED
Supporting Nanhi Kali:
Project Nanhi Kali, which supports the education of the
disadvantaged girl child, has been the flagship programme
of the K. C. Mahindra Education Trust. The Mahindra Group
has committed to independently support 6,000 girls in
urban, rural and tribal parts of India by providing academic
support as well as material support in the form of uniforms,
clothes, school bags, shoes, etc. In addition, the Mahindra
Group, through K. C. Mahindra Education Trust, has entered
into a partnership with the Government of Rajasthan to
jointly support the education of 10,000 disadvantaged girls
in the tribal area of Udaipur District through Project Nanhi
Kali, with the Government of Rajasthan supporting 5,000
Nanhi Kalis and the Company supporting the education of
5,000 girls. In total, the Mahindra Group continues to
support the education of 11,000 underprivileged girls
through Project Nanhi Kali. With support from individuals
and other corporate donors like the Mahindra Group,
Project Nanhi Kali now supports the education of over
49,454 underprivileged girls, in poor urban, rural and tribal
communities across 8 States of India.
Gifting Cochlear Implants:
By gifting the power of sound through the donation of
Cochlear Implants, the Mahindra Group has changed the
life and future of 49 profoundly hearing-impaired,
underprivileged children till date. Operations are performed
by Dr. Milind Kirtane, India’s leading ENT surgeon. All
recipients are selected in consultation with Dr. Kirtane and
his team of doctors, audiologists, teachers of the hearing
impaired and social counselors. All beneficiaries are hearing
impaired children below the age of 5, belonging to the
lower socio economic strata of society.
Mahindra All India Talent Scholarships (MAITS):
During the year, 510 students from 11 centres all over
India were awarded the MAITS which enabled them to
11
pursue job oriented diplomas at a recognised Government
Polytechnic in India. The Scholarship is awarded for a 3
year period. A majority of the scholarship awardees are
girls, as the Trust is keen to empower girls through
vocational education. Till date, 4,260 students have been
awarded the MAITS with majority of them belonging to
very poor families where average income of the family
ranges from Rs.1,500 to Rs.2,000 per month.
Employee Social Options:
Employee Social Options (“Esops”) is an unique programme
at the Mahindra Group where each employee can do social
work by volunteering in various CSR initiatives. This year,
10,341 employees volunteered for various social activities
in their local communities. Esops was formally launched in
8 new locations of Mahindra Group.
Some of the Notable Esops initiatives this year were:
• The Lifeline Express in Assam: This was jointly sponsored
and organised by Automotive Sector and Mahindra &
Mahindra Financial Services Limited in Guwahati. The
project was held in the remote area of Rangia in Assam
and 594 surgeries were performed free of cost (Cleft
Lip, Polio, Cataract and Deafness). Esops Volunteers
spent 9,376 man hours in this activity whereas 19,392
man hours were spent by community volunteers –
thus making it an ideal public-private partnership
initiative.
• Target Surpassed “Mahindra Hariyali”: In October,
2008, the Management’s vision of planting one million
trees was surpassed with 12,21,118 trees being planted
by enthusiastic employee volunteers and community
partners (NGO’s, villagers, local schools, local colleges,
etc.). All Sectors of the Mahindra Group and the
Mahindra United World College of India participated
in the Group’s green endeavour.
12
• Bihar Flood Relief: The devastating Bihar floods saw
immediate help from Esops Volunteers of Mahindra
along with local Dealers at Purnea. Immediately after
the floods, the Mahindra relief team systematically
distributed food, clothes and other crucial items worth
Rs.15 lakhs to over 10,000 affected people through
15 relief camps mainly at Purnea, Madhepura and
Araria. In the second phase, 10,000 blankets were
distributed in Murliganj and Madhepura. Employees
of the entire Mahindra Group gave one day’s salary
towards the relief of the Bihar flood victims and this
amount was matched by the Mahindra Group.
A complete rehabilitation project worth Rs.3.57 crores
is in the pipeline and will begin in the next few months.
Other Esops activities also included initiatives in Education,
Health and Environment having long lasting impact. 60
initiatives were conducted in Education (such as distributing
educational material, IT/vocational training, infrastructure
development) by 745 Esops volunteers impacting 17,656
lives. 94 health initiatives such as medical camps, mobile
dispensaries, etc. reached out to over 71,913 people. Over
33 Blood donation Camps were held across various plants
and offices of the Mahindra Group. 340 HIV/AIDS
awareness campaigns reached out to over 1 lakh people
in Nashik.
‘Sustainability’ Initiative
The threats of Global Warming and Climate Change have
become the defining issues of our era for all humanity.
The scientific facts before us are overwhelming and cannot
be ignored. How and what we do to address these threats,
directly affects the entire spectrum of our life and only
collaborative efforts by Governments, Corporate Bodies and
Society will lead to a solution to this draconian challenge
before us.
Your Company has always been sensitive to the fact that,
since Corporations are vital organs of Society, Corporate

interests must serve societal concerns and play an active
th
role in fulfilling its social responsibilities. Hence, in its 60
year, the Company committed to pledge 1% of its Profit
after Tax (PAT) to benefit the socially and economically
disadvantaged sections of the Society. The Company now
needs to take this responsibility to encompass a wider
spectrum, and extend it to the conservation of the
ecological integrity of our planet by way of responsible
business practices and greater accountability and
transparency.
Hence in October, 2008, the first Mahindra Group
‘Sustainability Report’, was released, setting out its ‘triple
bottom line’ performance i.e. performance towards the
environmental, societal as well as economic aspects,
towards creating sustainable value for all its stakeholders.
This was in accordance with the latest Guidelines of the
internationally accepted, Global Reporting Initiative (GRI).
This Report was affirmed by Ernst & Young and conforms
to the highest level for reporting ‘Sustainability’
performance, which is A+. The report and the performance
rating of A+ was checked and confirmed by GRI. (GRI is a
Netherland based multi-stakeholder network of thousands
of experts worldwide, which has pioneered the development
of the world’s most widely used sustainability reporting
framework. This reporting framework sets out the principles
and indicators that organisations can use to measure and
report their economic, environmental and social
performance).
In order to generate and enhance awareness about
“Sustainability” among Shareholders, the synopsis of the
above mentioned Sustainability Report and the reason why
there is a need to change the way business was done so
far, has been elaborated on Pages 68 and 69 of this
Annual Report. The detailed Mahindra Group Sustainability
Report is available on the Company’s website
MAHINDRA & MAHINDRA LIMITED
http://www.mahindra.com. This Report is essentially the
first step which will take your Company on a ‘Sustainability
journey’ and enabling it to make conscious plans, to reduce
GHG emissions and waste as well as conserve water, bio-
diversity and natural resources, as a part of its growth
strategy.
It is a matter of pride that this first Report bearing the
theme ‘Alternative Thinking’ was ranked 5th under the
category of ‘Creativity in Communications’ by the Corporate
Register Reporting Awards. These are the 1st global,
independent and online awards for ‘triple bottom line’ or
‘Sustainability’ reporting, designed to acknowledge the best
in Corporate non-financial reporting in which majority of
the FT 500 companies have participated.
Directors
Life Insurance Corporation of India (“LIC”) withdrew the
nomination of Mr. Thomas Mathew T., as a Nominee
Director with effect from 30th July, 2008. Consequently,
Mr. Mathew ceased to be a Director of the Company.
Mr. Arun Kanti Dasgupta was appointed as a Director in
the vacancy caused by the withdrawal of nomination of
Mr. Mathew by LIC at the Meeting of the Board of Directors
held on 30th July, 2008. Mr. Dasgupta holds office upto
the date of the forthcoming Annual General Meeting as
Mr. Mathew, in whose place he has been appointed, would
have retired by rotation at the forthcoming Annual General
Meeting.
The Company has received a Notice from a Member under
section 257 of the Companies Act, 1956, signifying his
intention to propose Mr. Dasgupta for the office of
Director.
The Board has placed on record its sincere appreciation of
the valuable services rendered by Mr. Mathew during his
tenure as a Director of the Company.
13
Mr. Deepak S. Parekh, Mr. Bharat Doshi and Mr. Narayanan
Vaghul retire by rotation and, being eligible, offer
themselves for re-appointment.
Directors’ Responsibility Statement
Pursuant to section 217(2AA) of the Companies Act, 1956,
your Directors, based on the representations received from
the Operating Management, and after due enquiry, confirm
that:
(i) in the preparation of the annual accounts, the
applicable accounting standards have been followed;
(ii) they have, in the selection of the accounting policies,
consulted the Statutory Auditors and these have been
applied consistently and reasonable and prudent
judgments and estimates have been made so as to
give a true and fair view of the state of affairs of the
Company as at 31st March, 2009 and of the profit of
the Company for the year ended on that date;
(iii) proper and sufficient care has been taken for the
maintenance of adequate accounting records in
accordance with the provisions of the Companies Act,
1956 for safeguarding the assets of the Company and
for preventing and detecting fraud and other
irregularities;
(iv) the annual accounts have been prepared on a going
concern basis.
Subsidiary Companies
The subsidiary companies of your Company continue to
contribute to the overall growth of the Company. Major
subsidiaries such as the Tech Mahindra Group with a 208%
growth in profits, Mahindra & Mahindra Financial Services
Limited with a 21% growth in profits and Mahindra
Holidays and Resorts India Limited with a 3.59% growth
in profits deserve special mention. The consolidated Group
Profit for the year after exceptional items, prior period
14
adjustments and tax and after deducting minority interests
is Rs.1,405.41 crores as against Rs. 1,571.12 crores earned
last year.
During the year under review, Mahindra Gears International
Limited, Mahindra Gears Global Limited, Mahindra Gears
Cyprus Limited, Mahindra Metalcastello S.r.l., Mahindra
Bebanco Developers Limited, Mahindra Industrial Township
Limited, Metalcastello S.p.A, Crest Geartech Private Limited,
Engines Engineering S.r.l., Eff Engineering S.r.l., ID-EE S.r.l.,
Mahindra IT Consulting Private Limited, Mahindra Two
Wheelers Limited, Mahindra Automotive Australia Pty.
Limited, Mahindra United Football Club Private Limited,
Mahindra Defence Land Systems Private Limited, Venturbay
Consultants Private Limited and Mahindra Yueda (Yancheng)
Tractor Company Limited became subsidiaries of your
Company.
During the year under review, iPolicy Networks Limited,
Tech Mahindra (R&D Services) Limited, Tech Mahindra (R&D
Services) Inc., Mahindra Holdings & Finance Limited,
Mahindra Retail Private Limited and Punjab Tractors Limited
ceased to be subsidiaries of the Company.
Subsequent to the year-end, Mahindra Industrial Township
Limited has changed its name to Industrial Township
(Maharashtra) Limited, Mahindra Knowledge City Limited
has changed its name to Knowledge Township Limited,
Plexion Technologies GmbH has changed its name to
Mahindra Engineering GmbH and Mahindra SAR
Transmission Private Limited has changed its name to
Mahindra Gears & Transmissions Private Limited.
The Statement pursuant to section 212 of the Companies
Act, 1956 containing details of the Company’s subsidiaries
is attached.
The Consolidated Financial Statements of the Company
and its subsidiaries, prepared in accordance with
Accounting Standard AS21 form part of the Annual Report.

In terms of the approval granted by the Central Government
under section 212(8) of the Companies Act, 1956, copy of
the Balance Sheet, Profit and Loss Account, Reports of the
Board of Directors and Auditors of the subsidiaries have
not been attached to the Balance Sheet of the Company.
The Company Secretary will make these documents available
upon receipt of request from any Member of the Company
interested in obtaining the same. However, as directed by
the Central Government, the financial data of the
subsidiaries have been separately furnished forming part
of the Annual Report. These documents will also be
available for inspection at the Head Office of the Company
and at the office of the respective subsidiary companies,
during working hours upto the date of the Annual General
Meeting.
Auditors
Messrs. Deloitte Haskins & Sells, Chartered Accountants,
retire as Auditors of the Company and have given their
consent for re-appointment. The Shareholders will be
required to elect Auditors for the current year and fix their
remuneration.
As required under the provisions of section 224(1B) of the
Companies Act, 1956, the Company has obtained a written
certificate from the above Auditors proposed to be re-
appointed to the effect that their re-appointment, if made,
would be in conformity with the limits specified in the said
section.
Public Deposits and Loans/Advances
Out of the total 7,522 deposits of Rs.3,093.79 lakhs
(including 23 unclaimed deposits of Rs.8.99 lakhs of the
erstwhile Punjab Tractors Limited) from the public and
Shareholders as at 31 st March, 2009, 190 deposits
amounting to Rs.37.46 lakhs had matured and had not
been claimed as at the end of the financial year. Since
MAHINDRA & MAHINDRA LIMITED
then, 37 of these deposits of the value of Rs.9.32 lakhs
have been claimed.
The particulars of loans/advances and investment in its
own shares by listed companies, their subsidiaries,
associates, etc., required to be disclosed in the Annual
Accounts of the Company pursuant to Clause 32 of the
Listing Agreement are furnished separately.
Current Year
During the period 1st April, 2009 to 27th May, 2009, 35,335
vehicles were produced as against 32,512 vehicles and
33,578 vehicles were despatched as against 32,214 vehicles
during the corresponding period in the last year. During
the same period 24,420 tractors (including Swaraj Division)
were produced and 23,816 tractors (including Swaraj
Division) dispatched as against 15,834 tractors produced
and 15,639 tractors despatched during the corresponding
period in the previous year.
The financial crisis that hit the developed world in
September last year has impacted economic growth across
the globe. Manufacturing activities in the country have
been hit particularly sharply by the meltdown in global
financial and trade flows. However, the growth in motor
vehicle sales in March and April, rise in PMI index for India
to level above 50 in April and the installation of a pro-
reform and stable Government ushered in by the recent
elections augur well for a recovery of the economy in the
near term. Given your Company’s continuous focus on
quality, cost controls, process efficiencies and new product
developments and innovations, your Company is poised to
quickly take advantage of the expected positive turn of
events and hopes to cope with these challenges and looks
to the future with confidence.
Acquisitions and other matters
Your Company continued its policy of organic and inorganic
growth encompassing key Sectors of your Company and
concentrated on consolidating its position in various spheres
15
of its business. During the financial year 2009, assignments
across all the transaction categories were successfully
executed. Some of the prominent illustrative transactions
in the financial year 2009 are enumerated as under:
1. Acquisition of Assets in 2 Wheeler Segment:
In line with your Company’s policy of striving to be a
key player in the “Entire Value Chain”, your Company
has made its maiden foray in the 2 Wheeler Segment
by acquiring the assets of Kinetic Motor Company
Limited (KMCL). This acquisition has provided an
additional touch-point for consumers to interact and
bond with the ever-expanding Mahindra Universe of
products and services thereby allowing the Company
to build relationships with customers at a relatively
early stage in the ‘personal transport solutions’ value
chain. This should enable the Company to extend itself
into a large market adjacent to the existing business,
leveraging on its strong corporate brand name,
distribution network in small towns/rural areas,
manufacturing and sourcing capabilities, strong
relationships with dealers and by providing consumer
finance through Mahindra & Mahindra Financial
Services Limited.
This acquisition gives your Company an optimal
strategic fit for a quick and low cost market entry.
It also provides an access to flexible assembly,
manufacturing and R&D facilities, reputed technical
collaborations for launching new products with short
lead times. This acquisition has been completed in
November, 2008 and the facilities have now become
operational.
2. Acquisition of Engines Engineering, Italy (EE):
In line with the “Design to Delivery” policy of Systech
Sector, your Company has acquired a prominent two
wheeler design company in Italy.
16
EE provides a ‘One Stop Solution’ in the form of
conception, design, styling, on-line assembly,
industrialisation and marketing. Some of the most
prestigious names that are associated with EE are
Benelli, Beta, Ducati, Gilera, Honda, LEM, Malaguti
and Yamaha. EE is the first ever company to introduce
plastic components in Scooters and is a known name
in motorcycle racing competitions in 125 GP Class.
It has a strong cohesive highly skilled people and most
of them having spent their entire professional life with
EE. This acquisition provides an entry into the two
wheeler design capability, generating additional revenue
through an European face and benefits your Company
with aggressive off-shoring of work. Besides improving
the utilisation process, it would also enhance
competencies of Mahindra Engineering Services Limited
through knowledge transfer. EE has an unparalleled
expertise in the two wheeler domain which can be
explored to open up a two Wheeler design centre in
India.
3. Consolidation of Gear Business:
a) Acquisition of Metalcastello, Italy:
One of the key pillars of the Systech Sector strategy
is to have a Global presence in Gear space. In
order to enhance its presence in this space
and expand its global footprints in automotive
components manufacturing, your Company has
during the year acquired Metalcastello S.p.A.
(M C), a Gear manufacturing company in Italy.
Metalcastello fits strategically well in the overall
Gears business vision and complements the
Company’s current portfolio. This acquisition would
allow the Company to exploit potential synergies
between operations of Mahindra Gears &
Transmissions Private Limited, M C and Crest

Geartech Private Limited which is a subsidiary of
M C at Faridabad. It will also allow the Company’s
Systech Sector to gain access to international
markets and customers in Automotive / Automotive
Component Industry specifically in the Gears
segment. In order to conserve financial resources
and utilise them over a larger canvas for the Gears
domain, your Company has strategically tied up
with ICICI Venture Fund, a private equity fund
which has co-invested in this space. Your Company
through its subsidiaries has an effective economic
interest of 51% in M C, with ICICI Venture holding
44.61% and the M C Management holding a
minority stake of 4.39%.
b) Increase in stake in Mahindra Gears & Transmissions
Private Limited (MGTPL) (formerly known as
Mahindra SAR Transmission Private Limited):
Your Company bought out the minority
Shareholder’s stake of 39.74% from SAR Auto
Products Limited thus making MGTPL a wholly
owned subsidiary of the Company. This increase
in stake would facilitate the consolidation and
alignment of the Systech Sector’s Indian Gear
businesses with that of the recently acquired
Metalcastello S.p.A. in Italy.
4. Acquisition of Tractor Company in China:
With a view to further consolidate the Company’s
presence in China, being one of the top three tractor
markets, your Company’s Farm Equipment Sector has
formed a Joint Venture viz. Mahindra Yueda (Yancheng)
Tractor Company Limited (JV) in China with Jiangsu
Yueda Yancheng Tractor Manufacturing Co. Ltd.
(Yancheng Tractor), a leading Chinese tractor
manufacturer. Yancheng Tractor’s Huanghai Jinma
brand is the No. 4 tractor brand in China in terms of
MAHINDRA & MAHINDRA LIMITED
tractor volumes in 2008. Your Company holds 51% in
the JV through its wholly owned subsidiary, Mahindra
Overseas Investment Company (Mauritius) Limited
(MOICML) and all the tractor related assets and current
liabilities of Yancheng Tractor have been transferred to
the JV.
With this acquisition, your Company will have a wide
product range from 16HP to 125HP, a large
manufacturing base which will be used to produce
tractors for the domestic market in addition to low
cost tractors for exports, considering that Yancheng
Tractor is also a leading exporter of tractors from China,
with a footprint in more than 60 countries including
the USA, South America, Russia, Europe and Africa.
The combined distribution network of both the
operations (including the 1st acquisition made by the
Company in China) will give your Company a much
larger presence in the Chinese market.
5. Merger of Punjab Tractors Limited (PTL):
Pursuant to the acquisition of PTL in the financial year
2008 and in order to reap the benefits and consolidate
the tractor business, it was decided to merge PTL into
your Company. The amalgamation of PTL with your
Company has inter alia lead to cost savings, achieving
economies of scale, sourcing benefits, vendor
rationalisation, more focused operational efforts,
simplification of business processes, productivity
improvements and putting cash resources to optimal
use. Above all, this has strengthened your Company’s
leadership in the industry, in terms of its asset base,
revenues, product range, production volumes, brand
consolidation and market share.
The amalgamated entity has benefited from improved
organisational capability and leadership, arising from
17
 the combination of people from PTL thereby giving it
an edge in an increasingly competitive industry.
This merger was effected pursuant to a Scheme of
Amalgamation which was approved by the
Shareholders at the Court Convened Meetings of your
Company and PTL respectively and the merger has
been approved by the Honorable High Court of
Judicature at Bombay and Honorable High Court of
Punjab & Haryana. The Appointed Date for the merger
was 1st August, 2008 and the merger became effective
from 16th February, 2009.
6. Private Equity in the Automobile After Market Segment:
With a view to providing consumers a wide choice of
good quality used cars through trust and transparency,
your Company has forayed into the After Market
Segment. For funding its growth plans which inter-
alia include the opening of owned Superstores, further
developing its Franchisee network and expanding into
newer cities, your Company has obtained equity
infusion from a PE, namely PHI Management Solutions
Private Limited to the extent of 31.58% in Mahindra
First Choice Wheels Limited. This business vertical will
consolidate your Company’s multi-brand service chain
Mahindra First Choice Services Limited, along with its
pre-owned vehicles business, Mahindra First Choice
Wheels Limited and Mahindra Spares Business.
7. Merger of Mahindra Holdings & Finance Limited
(“MHFL”):
As mentioned in the last year’s Directors Report, in
order to simplify and consolidate the Group holding
structure, your Company decided to merge its wholly
owned subsidiary MHFL into your Company. This
amalgamation has benefited both the companies and
their stakeholders on account of enhanced financial
18
strength and capability. In addition, the proposed
Scheme has enhanced your Company’s financial
strength and has resulted in higher Shareholder value
creation and distribution. The proposed Scheme was
approved by the Shareholders at a Court Convened
Meeting held on 12th April, 2008. The Appointed Date
for this Merger was 1st February, 2008 and became
effective from 11th August, 2008.
8. Transfer of Logistics Business:
In order to focus on and accelerate the growth of the
Logistics Business of your Company, it was decided to
transfer this Business (formerly known as the Transport
Solutions Group) into a wholly owned subsidiary by
the name of Mahindra Logistics Limited (“MLL”).
This transfer was approved by the Shareholders under
section 293(1)(a) of the Companies Act, 1956 through
a Postal Ballot on 28th July, 2005. Pursuant to this,
the Company entered into a Business Transfer
Agreement in September, 2008 with MLL in order to
enable such transfer of its Logistics Business
to MLL.
9. Automotive Sector Joint Venture in Australia:
In line with the Automotive Sector’s aspirations to be
a global player in the SUV and Pick-up vehicle
segments, your Company decided to foray into the
Australian market in 2007.
Your Company through its newly formed Australian
subsidiary, Mahindra Automotive Australia Pty. Limited
(“MAAPL”) has taken over Distributorship of vehicles
in Australia from TMI Pacific Pty. Ltd. TMI continues to
be a partner in MAAPL with a 20% stake with the
balance 80% being held by your Company. Your
Company’s foray in this space is a definitive step in its
strategy to grow and position itself as a Global
Automotive OEM in Australia.

10. Mahindra South Africa:
Mahindra and Mahindra South Africa (Proprietary)
Limited (“MSA”) was formed as a subsidiary of the
Company with a 51% stake and the remaining 49%
stake held by African Automotive Investment
Corporation (“AAIC”), a South African company. In
order to grow in this line of business, your Company
has decided to buy out the stake of AAIC and also to
infuse suitable funds in the near future.
11. Proposed Merger of Mahindra Hinoday Industries
Limited (“MHIL”) with Mahindra Castings Private Limited
(“MCPL”):
In order to consolidate the activities and optimise from
the benefits of synergy, MHIL and MCPL have filed
respective petitions to the Honorable High Court of
Judicature at Bombay for sanctioning of the Scheme
of Amalgamation of MHIL with MCPL and their
respective Shareholders (“the Scheme”). In terms of
the Scheme, the Appointed Date for the Amalgamation
is 1st April, 2008. The Scheme is awaiting sanction by
the Honorable High Court of Judicature at Bombay.
MAHINDRA & MAHINDRA LIMITED
Energy Conservation, Technology Absorption and
Foreign Exchange Earnings and Outgo
Particulars required to be disclosed under the Companies
(Disclosure of Particulars in the Report of Board of Directors)
Rules, 1988 are set out in Annexure II to this Report.
Particulars of Employees
The Company had 315 employees who were in receipt of
remuneration of not less than Rs.24,00,000 during the
year ended 31st March, 2009 or not less than Rs.2,00,000
per month during any part of the said year. However, as
per the provisions of section 219(1)(b)(iv) of the Companies
Act, 1956, the Directors’ Report and Accounts are being
sent to all the Shareholders of the Company excluding the
Statement of particulars of employees. Any Shareholder
interested in obtaining a copy of the Statement may write
to the Company Secretary of the Company.
For and on behalf of the Board
KESHUB MAHINDRA
Chairman
Mumbai, 28th May, 2009
19
ANNEXURE I TO THE DIRECTORS’ REPORT FOR THE YEAR ENDED 31ST MARCH, 2009
Information to be disclosed under the Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock
Purchase Scheme) Guidelines, 1999:

(a) Options granted 98,61,613

(b) The pricing formula 1st Tranche 2nd Tranche 3rd Tranche 4th Tranche 5th Tranche 6th Tranche 7th Tranche 8th Tranche 9th Tranche

Average Average Discount Discount Average Discount Discount Discount Discount

price price of 5.13% of 4.85% price of 5.02% of 4.89% of 4.97% of 5.03%
preceding preceding on the on the preceding on the on the on the on the
the the average average the average average average average
specified specified price price specified price price price price
date - 27th date - 30th preceding preceding date - 14th preceding preceding preceding preceding
September, May, 2003 the the September, the the the the
2001 specified specified 2005 specified specified specified specified
date - 31st date - 30th date - 29th date - 13th date - 30th date - 4th
May, 2004 May, 2005 May, 2006 September, July, 2007 August,
2006 2008

Average price - Average of the daily high and low of the prices for the Company’s Equity
Shares quoted on Bombay Stock Exchange Limited during 15 days preceding
the specified date.

The specified date - Date on which the Remuneration/Compensation Committee decided to

recommend to the Mahindra & Mahindra Employees’ Stock Option Trust
(Trust), the grant of Options.

(c) Options vested 53,34,461 Options stand vested on 31st March, 2009.

(d) Options exercised 36,46,694

(e) The total number of 36,46,694 Equity Shares of Rs.10 each. These were transferred from the Trust to the Eligible Employees.
shares arising as a
result of exercise of
option

(f) Options lapsed 5,98,998

(g) Variation of terms At the Sixty-first Annual General Meeting of the Company held on 30th July, 2007, the Mahindra &
of options Mahindra Limited Employees Stock Option Scheme was amended to provide for recovery from Eligible
Employees, the fringe benefit tax in respect of Options which are granted to or vested or exercised by
the Eligible Employees on or after 1st April, 2007.

(h) Money realised by Rs. 40,27,83,473. This amount was received by the Trust.
exercise of options

(i) Total number of 56,15,921

options in force

20
 MAHINDRA & MAHINDRA LIMITED

(j) Employee-wise details of

options granted to:

(i) Senior managerial As per Statement attached

personnel

(ii) Any other employee Names Options granted Names Options granted
who receives a grant in during the year during the year
any one year of option ended 31st March, ended 31st March,
amounting to 5% or 2004* 2005*
more of option granted
during that year

Mr. Raghunath Murti 15,000 Mr. Pranab Datta 15,240

Mr. Hemant Luthra 15,240 Mr. Rajeev Dubey 15,000

Mr. Ramesh Iyer 25,920 Mr. Allen Sequeira 10,160

- - Mr. Prince M. Augustin 5,080

* The Options granted stand augmented by an equal number of Options and the Exercise
Price stands reduced to half on account of the 1:1 Bonus Issue made in September, 2005.

(iii) Identified employees Nil

who were granted option,
during any one year, equal
to or exceeding 1% of the
issued capital (excluding
outstanding warrants and
conversions) of the
company at the time of
grant

(k) Diluted Earnings Per Share (EPS) pursuant to issue of shares Rs.30.02
on exercise of option calculated in accordance with
Accounting Standard (AS) 20 ‘Earnings per Share’

(l) Where the company has calculated the employee
compensation cost using the intrinsic value of the stock
options, the difference between the employee
compensation cost so computed and the employee
compensation cost that shall have been recognised if it
had used the fair value of the options, shall be disclosed.
The impact of this difference on profits and on EPS of the
company shall also be disclosed.
The Company has calculated the employee compensation cost
using the intrinsic value of stock options. Had the fair value
method been used, in respect of stock options granted on or
after 30th June, 2003, the employee compensation cost would
have been higher by Rs.33.91 crores, Profit after tax lower by
Rs.33.91 crores and the basic and diluted earnings per share
would have been lower by Rs.1.24 and Rs.1.15 respectively.

21
(m) Weighted-average exercise prices and weighted-average Options Grant Date Exercise price Fair value
fair values of options shall be disclosed separately for (Rs.) (Rs.)
options whose exercise price either equals or exceeds or is 13th August, 2008 500.00 219.77
less than the market price of the stock.
The fair-value of the stock options granted on 13th August,
(n) A description of the method and significant assumptions
2008 have been calculated using Black-Scholes Options pricing
used during the year to estimate the fair values of options,
Formula and the significant assumptions made in this regard
including the following weighted-average information:
are as follows:

(i) risk-free interest rate, 9.17%

(ii) expected life, 2.50 years

(iii) expected volatility, 38.84%

(iv) expected dividends, and 2.80%

(v) the price of the underlying share in market at the Rs.593.35

time of option grant.

STATEMENT ATTACHED TO ANNEXURE I TO THE DIRECTORS’ REPORT FOR THE YEAR ENDED 31ST MARCH, 2009

Name of Senior Managerial Options granted in Options granted in Options granted in Options granted in Options granted in
Persons to whom Stock December, 2001* June, 2005** September, 2006 July, 2007 August, 2008
Options have been granted

Mr. Deepak S. Parekh 20,000 5,000 Nil Nil Nil

Mr. Nadir B. Godrej 20,000 5,000 Nil Nil Nil

Mr. M. M. Murugappan 20,000 5,000 Nil Nil Nil

Mr. Narayanan Vaghul 20,000 5,000 Nil Nil Nil

Dr. A. S. Ganguly 20,000 5,000 Nil Nil Nil

Mr. R. K. Kulkarni 20,000 5,000 Nil Nil Nil

Mr. Anupam Puri 20,000 5,000 Nil Nil Nil

Mr. Bharat Doshi 1,00,000 10,000 11,345 8,362 29,039

Mr. A. K. Nanda 1,00,000 10,000 11,345 8,362 24,890

* All the above Options have been exercised.

** The Options granted stand augmented by an equal number of Options and the Exercise Price stands reduced to half on account
of the 1:1 Bonus Issue made in September, 2005.

22

ANNEXURE II TO THE DIRECTORS’ REPORT FOR THE YEAR ENDED 31ST MARCH, 2009
PARTICULARS AS PER THE COMPANIES (DISCLOSURE OF
PARTICULARS IN THE REPORT OF BOARD OF DIRECTORS)
RULES, 1988 AND FORMING PART OF THE DIRECTORS’
REPORT FOR THE YEAR ENDED 31ST MARCH, 2009
A) Conservation of Energy
Energy Conservation Measures:
1. Engineering Initiatives
a) Commissioning of Energy Efficient Screw
Chiller for Central Air Conditioning at Kandivali
Plant.
b) Installation of compressed air demand side
controller at Igatpuri Plant.
c) Round the clock monitoring of Electrical/
Compressed Air Consumption by installing
Energy Data Acquisition System.
d) Installation of Heat Pumps for washing
machines at Kandivali and Igatpuri Plant by
eliminating electrical heating.
e) Installation of Fanless cooling tower in place
of forced draft cooling tower.
f) Installation of Variable Frequency Drives for
Paint Shop Blowers at Kandivali and Nashik
Plant.
g) Installation of Natural draft Turbine air
ventilators instead of electrical driven exhaust
fans.
h) Installation of Energy efficient pulse start
technology Metal Halide lamps in place of
conventional Mercury Vapor lamps for shop
floor lighting.
i) Capacitors installation and Automatic power
factor controllers.
MAHINDRA & MAHINDRA LIMITED
j) Replacing higher power consuming
equipments with lower power consuming
equipments such as Electronic ballasts,
Low HP Pumps, CFL, water cooled heat
exchanger, etc.
k) Improving insulation of thermic fluid pipe line
to eliminate heat loss.
l) Maintaining the Unity Power factor round the
year by adding capacitor bank with Automatic
P.F. controller and also installing fix capacitor
bank for the motor above 50kw rating.
m) Controlling the Air conditioning timing by
introducing the Timer Ckt in the Package AC
of New Administrative Block.
n) Alternate switching of Street Lights.
o) Siphon system of Over Head drinking water
tank at Trans, Tractor and Canteen Building
with Water Level sensor and Automatic
controls.
p) Maximum Utilisation of ‘A Zone’ Tariff by
shifting the manufacturing activity in Hybrid
shift.
q) Introduction of T 5 Lighting in place of
conventional Metal Halide lamps on Tractor
Pre and Post Painting line.
r) Changing of Electric Circuit of the Hydraulic
Presses, Water Circuit at the Engine testing
and pulley size for Blowers and
Reprogramming of the Variable Frequency
Drives for Spray Pumps.
2. Through Process Improvement
a) Combining operations at Press Shop so as to
avoid additional running of presses.
23
 b) Enhancing production capacity at Pre- r) Elimination of Drum filter motor for Makino.
treatment to achieve reduced Specific Energy
s) Optimisation of Degreasing Stage 01 and
Consumption.
Stage 02 Spray pumps to save electrical energy.
c) Reduction of hot water generator temperature
t) Stopping of Idle running of Unit B Hydraulic
without affecting Quality Parameters.
Pump in Engine PG.
d) Conversion of RX Generator at Heat Treatment
u) Installation of Heat Pumps on GPM and CCS01
from LPG to PNG with optimum air-fuel ratio.
Machines.
e) Staggering shift production for availing Time
v) Pressure Boosting and Regulating Pump for
of Day power tariff advantage.
Engine Testing area.
f) Occupancy Sensors for lighting.
w) Optimization of cooling tower power
g) Auto switching Off for office air conditioning consumption.
units.
x) Plant level drive to stop the Air Leakages.
h) Digital Temperature Controllers for Window
Air Conditioners. y) Changing of the Outlet Temperature at the
Hot Water Generator from 120 Deg Celsius to
i) Auto valves for compressed air and water 95 Deg Celsius.
application.
z) Timer setting of the Spray Pump in the Cylinder
j) Timers for blowers, fans and lights.
head washing machine at M/c Shop.
k) Replacing higher H.P to lower H.P motors.
3. Awareness for Energy Conservation
l) Continuous to intermittent operation of
a) Annual Automotive Sector meet was
motors.
conducted for ENCON Members of all Plants
m) Elimination of Pinion Heating Oven and at Kandivali to share Energy related ideas and
combining Pinion heating operation with scope for Horizontal Deployment.
existing induction heater of Crank shaft Pinion
b) Modified Energy Management Policy of
Heating.
Automotive Sector which is distributed and
n) Elimination of bed wash coolant pumps on displayed at all the Plants.
M/c No. 1067.
c) Celebrated Energy Conservation Week from
o) Changed the Paint Methodology and paint 14th – 21st December, 2008 to promote energy
material for Tractor front and wheel balance saving and conservation of resources. Energy
weights. Efficient Products were displayed and sold.
p) Optimum utilisation of Paint booth by
d) Organised Energy Conservation slogans,
staggering Lunch and Dinner timings.
posters and suggestion competition for
q) Modification of Tackle design for Painting employees and their families. Winners had
Process resulting to reduction in paint booth been awarded in a Prize Distribution Ceremony.
operations.

24

e) Designed and distributed leaflets with Energy
Saving tips to all employees.
f) ENCON Stall on Founders Day celebration,
attended by five thousand families.
g) Spread the importance of Energy Conservation
through arranging awareness programs in
schools.
h) Celebration of World Water Day on 22nd March
and organising week long events on water
conservation including one interactive
exhibition on water saving ideas near canteen.
i) Energy conservation ideas were shared with
the Company’s vendors and suppliers.
Preliminary energy audit was conducted at
some vendors for scope of improvement.
j) Emails, energy saving posters and competitions
were used to create awareness among the
employees about the need for saving energy.
k) Display of details of energy generation
methods and the consumption process.
l) Idea generation campaign for electrical energy
saving.
m) Display of sustainability posters for educating
employees and their families on the impact of
wastages of electrical energy.
n) Stickers of ‘Go Green’ applied on every PC
monitor and Fans/Lights DB’s.
o) Exploration of the avenues of non-conventional
energy resources available in the country,
through websites and interactions with experts.
p) Cross functional team created for identifying
and implementing means of reducing the
MAHINDRA & MAHINDRA LIMITED
consumption of electricity during non-
production time.
q) Training provided to cell members to think
innovatively to reduce the energy consumption.
r) Red tag system introduced to reduce the air
leakages.
s) Rewards and recognitions for energy saving
projects.
t) Detailed Energy Audit conducted by external
agency to quantify energy consumption and
make people aware of potential areas of
action.
During the financial year, the Automotive Sector
has implemented more than 650 Energy Efficiency
Projects (including Horizontal Deployment) through
Engineering Initiatives, Auditors recommendation,
Ingenious drive process and TPM methodology
resulting in reduction of Specific Electrical and
Thermal Energy consumption. In terms of specific
consumption and costs, the Sector has achieved a
6.5% reduction as compared to financial year 2008
(which includes Power Factor Incentive for
maintaining unity power factor).
Likewise, the initiatives and other efforts
implemented by the Tractor Division have resulted
in reduction of energy consumption reflected
through cost savings for the Company, aggregating
approximately Rs.244.28 lakhs.
In recognition of these efforts, the Automotive
Sector of the Company received the following
prestigious awards at National and State levels,
viz.
The Nashik Plant was awarded the National
Level – Certificate of Merit from the Bureau of
Energy Efficiency.
25
 The Zaheerabad Plant was awarded the 1st
Prize at National and State Levels from the
Bureau of Energy Efficiency and the
Government of Andhra Pradesh respectively.
B) Research & Development and Technology
Absorption
During the year under review, the Automotive Division
pursuant to its R&D efforts on development of new
products and technologies, launched new products
like Xylo. The existing product portfolio was
strengthened by launch of variants like a new refresh
of the Scorpio, Scorpio with automatic transmission
and Bolero with CRDe engine.
As a part of the Company’s sustainable mobility
program, your Company launched CNG powered
variants of Bolero Pick-Up and three-wheeler Alfa.
India can achieve significant savings in fuel
consumption and lower emissions by promoting
vehicles that automatically switch off the engine when
idling and automatically restart when the vehicle starts
moving seamlessly and without any driver intervention.
The Company became India’s first and only automotive
manufacturer to launch FuelSmart system with Micro
Hybrid technology in its vehicles. Such vehicles, called
micro hybrids, use a start-stop system to ensure
reduced fuel consumption of 5-10% depending on
driving conditions with attendant reduced emissions.
The driver has only to press the accelerator for the
vehicle to automatically start up and move. This
technology has been made available on Scorpio and
Bolero variants during the year.
Keeping in view the future requirements of customers
and legislation in India and abroad, your Company
has undertaken various technology development
programs like alternate fuels, emission technologies,
transmissions, safety and comfort features.
26
In addition to technology development programs, the
Company is working at developing product variants
on existing product platforms and new products for
market segments which are currently not addressed
by the Company.
During the year under review, your Company’s
Automotive Division applied for 11 Design
Registrations, out of which 5 Design Registrations were
granted.
During the year under review, the Company’s Tractor
Division launched upgraded models of large selling
475DI and 575DI models. In the international space,
the Compact series was launched in USA and 705DI in
the 70 HP segment of the Company’s new introduction
as a value for money offering in Africa. Your Company’s
Swaraj Division, has launched a new series “XM” with
better fuel efficiency, new look and added features
designed for convenience and comfort. Beyond tractors,
your Company also launched crawler harvesters.
Keeping in view the future requirements of
technological upgradations, your Company has
undertaken various programs like development of
engines to meet future regulatory norms in India and
in countries to which the Company’s products are
exported.
During the year, your Company’s Farm Equipment
Sector has been granted one patent, filed in the USA.
Further, this year the Farm Equipment Sector has filed
11 new patent applications, in addition to the filing of
4 design registration applications, including 1 in the
USA.
The Company spent Rs.515.65 crores (including
Rs.276.87 crores on capital expenditure) on Research
and Development work during the year which was
approximately 3.44 % of the total turnover.
 MAHINDRA & MAHINDRA LIMITED

C ) Imported Technology for the last 5 years

Sr. No. Technology Imported Year of Import Status
1. NEF TCI 2004 Technology Absorbed
2. NEF Performance improvements 2004 Technology Absorbed
3. MDI Engine Upgradation 2004 Technology Absorbed
4. Anticlock Braking System on utility vehicle 2004 Technology Absorbed
5. Common Rail Diesel on utility vehicle 2004 Technology Absorbed
6. New CRDe Engine Development 2004 Technology Absorbed
7. Development of a new MPV 2004 Technology Absorbed
8. Euro IV Emission developments for exports 2004 Technology Absorbed
9. Multi Link Suspension for utility vehicle 2004 Technology Absorbed
10. Development of Air Bags on utility vehicle 2005 In the process of Absorption
11. Development of cruise control on utility vehicle 2005 Technology Absorbed
12. Fatigue Lab and track design for MRV, Chennai 2005 In the process of Absorption
13. Sandwich material for noise absorption 2005 Technology Absorbed
14. Development of Nano-Technology for IP etc. 2005 Technology Absorbed
15. Climate control (Heated and Cooled) seats 2005 In the process of Absorption
16. Bio-Diesel and Gas based engine 2005 Technology Absorbed
17. Transmission Design of Compact Tractor 2006 Technology Absorbed
18. Development of Integrated Cabin for Tractor 2006 In the process of Absorption
19. Hydrophilic Nano coated Feature 2007 In the process of Absorption
20. Automatic Transmission for SUV 2007 Technology Absorbed
21. Transmission for new SUV 2007 In the process of Absorption
22. New Generation system for Brakes for SUV 2007 In the process of Absorption
23. New Electricals & Electronics Features 2007 In the process of Absorption
24. CNG engines for LCV 2007 Technology Absorbed
25. Common Rail Diesel on Light commercial vehicle 2007 Technology Absorbed
26. Next generation Common rail adaptation 2007 Technology Absorbed
27. Hydrogen ICE 2007 In the process of Absorption
28. Fuel Cell Vehicle Development 2007 In the process of Absorption
29. 2nd Generation Biofuels (Biomass to Liquid / Gas to Liquid) 2007 In the process of Absorption
30. Hybrid Vehicles 2008 In the process of Absorption
31. Transmission Upgrade 2008 In the process of Absorption
32. Electricals & Electronics Update 2008 Technology Absorbed
33. Design for New Tractor Transmission 2008 In the process of Absorption
34. Start Stop Micro Hybrid 2009 Technology Absorbed
35. New Generation Engine Management System 2009 In the process of Absorption
36. CNG Engines for Pickups / 3 Wheelers 2009 Technology Absorbed
37. Electronic Programs for Safety, Stability & Steering Control 2009 In the process of Absorption
38. CAN Based Networking 2009 In the process of Absorption
39. New Airbag Program 2009 In the process of Absorption
40. Advanced Materials Technologies 2009 Technology Absorbed

Foreign Exchange Earnings and Outgo

The Company continues to strive to improve its export earnings. Further details in respect of exports are set out elsewhere in the
Report.

The information on foreign exchange earnings and outgo is furnished in the Notes on Accounts.
For and on behalf of the Board

KESHUB MAHINDRA
Mumbai, 28th May, 2009 Chairman

27
Particulars of loans/advances and investment in its own shares by listed companies, their subsidiaries,
associates, etc., required to be disclosed in the Annual Accounts of the Company pursuant to Clause
32 of the Listing Agreement.
Loans and advances in nature of loans to subsidiaries:
(Rupees in crores)
Name of the Company Balances as on Maximum outstanding
31st March, 2009 during the year
Mahindra & Mahindra Financial Services Limited 15.00 155.00
Mahindra Intertrade Limited 0.15 0.15
(including loans where there is no interest) (0.15) (0.15)
Bristlecone India Limited 8.03 8.03
Mahindra Gujarat Tractor Limited 1.00 1.00
Mahindra Shubhlabh Services Limited 2.00 8.25
NBS International Limited 2.00 2.00
Mahindra Forgings Limited 44.00 44.00
Bristlecone Limited 81.86 81.86
Mahindra Overseas Investment Company (Mauritius) Limited 38.69 38.69
Mahindra Engineering & Chemical Products Limited 30.20 30.20
Mahindra Engineering Services Limited 0.00 40.00
Mahindra Two Wheelers Limited 35.00 47.00
Mahindra Vehicle Manufacturers Limited 100.00 100.00
Mahindra Renault Private Limited 0.00 19.00
Mahindra Hinoday Industries Limited 19.00 19.00
Mahindra Holdings Limited 25.00 25.00
Mahindra Automotive Australia Pty. Limited 3.87 3.87
Loans and advances in the nature of loans to firms/companies in which Directors are Interested:
(Rupees in crores)
Name of the Company Balances as on Maximum outstanding
31st March, 2009 during the year
Infrastructure Development & Finance Company Limited 15.00 15.00
Housing Development Finance Corporation Limited 0.00 35.00

Except as indicated above, the Company has not made any loans and advances in the nature of loans to associates or
loans and advances in the nature of loans where there is no repayment schedule or repayment beyond seven years or no
interest or interest below section 372A of the Companies Act, 1956.
Investments by the Loanee in the shares of Subsidiary Company, when the Company has made loans or advances in the
nature of loan:

Investments in the shares of the Subsidiary Company:

(Rupees in crores)
Name of the Company Balances as on Maximum outstanding
31st March, 2009 during the year
Mahindra Engineering Services Limited 0.00 38.88

28

Management Discussion & Analysis
For most of the year under review, the global economy
faced unparalleled pressures. While the first few months
witnessed a sharp rise in the price of oil, food and other
commodities, inflationary fears soon gave way to concern
about depression and deflation as the financial crisis in the
advanced economies snowballed into a global economic
crisis of unprecedented magnitude. International trade and
financial flows froze and financial institutions crumbled,
leading to rising bankruptcies and widespread
unemployment across the globe. India is neither insulated
nor isolated from global events and has been significantly
impacted by this global meltdown. Exports from, and
capital flows to the country have contracted sharply, leading
to a slowdown in the country’s economic growth. However,
in spite of the contraction of many world economies, India
is expected to grow close to 6% in the coming fiscal,
making it one of the very few countries in the world which
would show any growth in the next two years.
Against this backdrop, your Company’s performance has
been satisfactory; indeed, your Company has outperformed
industry in many of the segments in which it operates.
Industry Structure
The Automotive Sector
The automotive industry occupies a place of pre-eminence
in the Indian economy, accounting for about 5% of GDP
and over 13 mn direct and indirect jobs, and contributing
about 17% of indirect taxes (Source: Automotive Mission
Plan 2006-2016).
Domestic sales in the segments in which the Company
participates - Multi Utility Vehicles (or MUVs) including
MAHINDRA & MAHINDRA LIMITED
soft tops, hard tops and pick-ups, Light Commercial Vehicles
(LCVs), three wheelers, and C-segment cars - declined by
1.7% during the year under review over the previous year
and stood at 917,260 vehicles. (Source: SIAM, Internal).
Your Company sold 220,213 vehicles in the domestic market
during the same period, a growth of 0.6% over the previous
year.
MUVs are a family of vehicles capable of versatile
applications such as passenger transport, goods transport
or a combination of the two. There are six manufacturers
of MUVs in India. Your Company is the largest manufacturer
of MUVs in India, offering a range of over 20 models. In
F-09 industry-wide domestic sales of MUVs were 268,753,
a decline of 7.4 % over F-08 (Source: Industry and internal).
LCVs (gross vehicle weight from 3.5MT to 7.5 MT) are
used mostly for intra-state movement of goods and short
distance transport of passengers. In F-09, 52,705 LCVs
were sold in the domestic market – a decline of 13.0%
over F-08 (Source: Industry and internal). The Company
competes in this segment through its subsidiary Mahindra
Navistar Automotives Limited (MNAL). There are six
manufacturers in India in this specific LCV segment.
India is the largest organised market in the world for three-
wheelers. In F-09 this segment declined by 4.1% over
F-08, with sales of 349,719 three-wheelers in the domestic
market (Source: SIAM).
In F-09, the C-Segment of passenger cars sold 246,011
vehicles, a growth of 12% over the previous year. The
C-segment is second largest segment of the passenger car
market comprising 19% of the total car sales in India.
There are nine players competing in this segment.
29
The Farm Equipment Sector
Agriculture plays an important role in the Indian economy
and society. It accounts for a little less than 20% of the
country’s Gross Domestic Product (GDP) yet contributes to
nearly 60% of employment in rural India.
The Indian tractor market is one of the largest markets in
the world by volume, despite a low penetration level of
tractors. The domestic tractor industry is fragmented, with
about 13 national players and some regional players. In
the current year, all the tractor manufacturers in India
together sold 303,921 tractors. Additionally, 38,910 tractors
were exported.
The domestic tractor market is traditionally segmented by
horsepower into the low horsepower 20 HP - 30 HP
segment, the mid segment of 30 - 40 HP and the higher
segment of above 40 HP. Most of the major players cater
to all the three segments. However, their relative strengths
and market positions differ from segment to segment.
Many factors affect tractor sales including monsoons,
availability of irrigation, reservoir water levels, government
declared support prices for key crops, commodity prices,
crop production expenses (such as seeds, fuel, fertilizer,
pesticides and other costs) and credit availability. The
availability of finance is one of the most significant factors
influencing tractor demand, as approximately 80% to 90%
of tractors are sold through finance from banks and other
financial institutions.
Your Company’s Farm Equipment Sector (FES), which
designs, develops, manufactures and markets tractors for
Indian and overseas markets is the largest manufacturer of
tractors in India and has sustained its market leadership in
the Indian tractor market for over 26 years.
Industry Developments
The Automotive Sector
Over the past one year, the global economic environment
30
has undergone significant turmoil. Global economy is
expected to shrink in 2009 for the first time in many
decades, and may remain weak in the medium term.
Financial markets have seen an unprecedented level of
stress and volatility. The automobile industry worldwide is
bearing the brunt of this general economic distress - with
precipitous decline in volumes, financial losses and
significant restructuring. India also witnessed lowered
economic growth during the year which impacted the
automotive industry adversely.
After several years of strong growth, the Indian automotive
industry experienced significant challenges in F-09,
particularly in the second half of the fiscal. A sharp
deterioration in liquidity conditions in the financial markets
significantly reduced availability of credit for automobile
buyers. In addition, economic growth slowed down rapidly
over the course of the fiscal year. As a result, F-09 saw a
drop in domestic sales of motor vehicles of 5.0%. The
commercial vehicle segment was the worst affected with a
21.7% drop in sales, while the three-wheeler segment
declined by 4.1%, and passenger vehicles sales were flat
(Source: SIAM).
Given the importance of the automobile industry to the
economy, the government provided active support through
fiscal stimulus (particularly by reducing the applicable excise
duty) and by making liquidity and credit available. Interest
rates and fuel prices were also reduced. As a result,
domestic sales showed a partial recovery in the last quarter
of the fiscal.
In addition, the automotive industry was also adversely
affected by a sharp rise in commodity prices, especially in
the first half of F-09. An unprecedented increase in the
prices of major input materials, along with the pricing
pressures due to the economic slowdown, put significant
pressures on the margins of the automobile manufacturers.

The Farm Equipment Sector
The first monsoon (between June and September) of FY
08-09 was 98% of the Long Period Average, resulting in a
good Kharif crop. However, during the second half of the
year, the country experienced a deficient north-east rainfall
(-31%) in 30 of the 36 meteorological districts. In spite of
overall lower rainfall and lower reservoir levels in F09, the
total food grain production during the year (Rabi + Kharif)
is expected to be almost equal to last year at 230 mn
tonnes, based on the latest estimates.
Substantial increases in Minimum Support Prices for various
crops announced by the Government have positively
impacted rural disposable incomes. In addition, in the 2008-
09 Union budget, credit allocation to agriculture saw an
increase of Rs. 50,000 crores to reach Rs.2,80,000 crores.
There was an increase in other outlays for supporting the
development of the rural economy. India’s agricultural GDP
is expected to have grown by around 2% in F-09.
Yet, the domestic tractor industry was faced with the
simultaneous impact of a liquidity crunch (following the
global economic crisis), stringent lending norms for farm
loans due to higher NPA’s and high interest rates. The
sharp rise in raw material prices in the first half of the year
with resultant price increases by all tractor manufacturers’
also impacted demand. Hence, the year under review saw
a flat domestic tractor industry which ended the year at
303,921 tractors (+0.6% vs. previous year).
Indian tractor exports totalled 38,910 tractors in F-09,
12.1% lower than last year due to the impact of global
economic turbulence, recessionary trends and sharp
changes in exchange rates in some markets.
Company’s Performance
The Automotive Sector
The Automotive Sector (AS) of the Company is engaged in
the Multi Utility Vehicle (MUV) and three-wheeler segments
MAHINDRA & MAHINDRA LIMITED
directly. It competes in the Light Commercial Vehicle (LCV)
segment through its joint venture subsidiary MNAL, and in
the passenger car segment through another joint venture
subsidiary Mahindra Renault Pvt. Ltd (MRPL). The Company
manufactures LCVs for MNAL and passenger cars for MRPL
on a contract basis. The Company also distributes these
LCVs and cars for the two joint venture companies
respectively under a distribution contract for a fee.
Despite the challenging business environment, your
Company maintained its vehicle sales. On the domestic
sales front, the Company along with its subsidiaries MNAL
and MRPL sold a total of 220,213 vehicles (including 44,533
three-wheelers, 8,603 LCVs through MNAL and 13,423
cars through MRPL), recording a growth of 0.6% over the
previous year.
Your Company’s domestic MUV sales volumes increased
by 3.3%, as against a decline of 7.4% for industry MUV
sales. A record number of 153,653 MUVs were sold in the
domestic market in F-09 compared to 148,761 MUVs in
the previous year. Indeed, in the month of March 2009,
against the backdrop of a tough business scenario, your
Company sold an all time record 25,748 vehicles in the
domestic market, by undertaking the target in mission
mode (christened Mission 25001). Hence, your Company
further strengthened its domination of the domestic MUV
sub-segment during the year, increasing its market share
to 57.2% over the previous year’s market share of 51.3%
(Source: Internal).
The continued success of the Company’s Bolero range and
the launch of the new Xylo (in January 2009) contributed
to MUV sales in a significant manner during the year. The
refreshed version of the Bolero that was launched in March
2007 continues to attract customers and the Bolero brand
continues to be India’s largest selling MUV, for the fourth
year in a row. The Company has recently launched a
refreshed version of the Scorpio (positioned as “the Mighty
31
Muscular Scorpio”), with an improved value proposition,
and has received an encouraging response. The Scorpio
became the first brand in the country to offer a BS-IV
compliant version to consumers.
In LCVs, M&M, through its subsidiary MNAL, has a presence
in the 3.5-7.5MT GVW segment of the market. In F-09,
your Company’s sales in this segment declined by 17%
against a decline of 13% for the industry segment. MNAL
is currently developing products to address the full range
of the commercial vehicle market. Mahindra Navistar
Engines Pvt. Ltd (MNEL), another joint venture company is
also in the process of developing a new power train for
the commercial vehicle range.
In the passenger car segment, MRPL sold 13,423 cars
(Logan), a decline of 48% over the previous year, due to
increased competitive activity in its market segment.
Industry sales in the C-segment, where Logan competes,
increased 12% in F-09.
In the three-wheeler segment, your Company’s sales
increased 31.3% to 44,533 units, as against a decline of
4.1% in the industry sales. This decline in the three wheeler
industry was caused by a significant deterioration in credit
availability for buyers. The Company’s growth was on
account of the success of the passenger version of the
Company’s Alfa three wheeler (launched in Feb 2008). The
Company now has a 12.7% market share in the three
wheeler segment.
Your Company believes that the Indian automotive market
is amongst the top growth markets in the world. Hence
your Company is continuing with its expansion plans as
envisioned. Construction work at the new manufacturing
site at Chakan (near Pune) is in full swing. This state-of-
the-art plant will be set up by Mahindra Vehicle
Manufacturers Limited (MVML), a wholly owned subsidiary
of the Company. It will have the capabilities to manufacture
the Company’s range of new generation MUVs as well as
32
commercial application vehicles. It will also manufacture
CVs for MNAL. Another subsidiary, MNEL (Mahindra
Navistar Engines Ltd.) will manufacture engines at this
facility.
In the global markets, the Company’s sales declined 31%
in F-09 to 8,501 units due to the challenging macro-
economic conditions and trade environment. Your Company
also sold 1,611 Logan cars in overseas markets through its
subsidiary MRPL.
Going forward, growth in overseas markets is a strategic
focus area for your Company and all plans for overseas
expansion are on track. Your Company continues to expand
its footprint in niche overseas markets with a strong
emphasis on building the MAHINDRA brand. In F-09, the
Xylo was launched in South Africa. Your Company formed
a new joint venture Mahindra Automotive Australia Pty.
Limited, to focus on the Australian Market. Your Company
also made its presence felt at several international motor
shows such as ones in Italy (Bologna), Chile, Johannesburg
(South Africa) and Sao Paulo (Brazil).
In Operations, your Company focused on rigorous cost
reduction through productivity improvement and waste
reduction. Energy conservation was an area of particular
focus. The impact of these efforts has been recognised
through a plethora of awards. The Zaheerabad plant was
awarded the National Energy Conservation Award (1st rank)
for the second consecutive year. The Nashik plant was
awarded the National Certificate of Merit, instituted by
the Bureau of Energy Efficiency and Ministry of Power, in
recognition of its energy conservation initiatives and also
won the CII National Award for Excellence in Water
Management.
Quality improvement and customer satisfaction is a thrust
area for your Company. The Company maintained its
standing at 3rd rank on Sales Satisfaction and was ranked
4 th on Customer Satisfaction, in syndicated studies
conducted by J.D. Power.

The Farm Equipment Sector
The financial year ending March, 2009 saw the merger of
erstwhile Punjab Tractors Limited (PTL) with your Company,
with effect from 1st August, 2008, the Appointed Date of
the merger. The merger became effective from
16th February, 2009 and from the said date it operates as
a part of the Farm Equipment Sector of your Company, as
its Swaraj Division. Therefore, the current year business
figures of your Company include PTL’s financials for the
period from 1st August, 2008 to 15th February, 2009. PTL
is a good strategic fit for the Company. Its strong ‘Swaraj’
brand equity and nationwide dealer network complement
your Company’s existing network, sound financial
fundamentals and dedicated and experienced workforce.
Following the acquisition, your Company has firmly
established its dominance in the Indian tractor industry
with 40.8% market share marking the 26th consecutive
year of leadership in the Indian tractor industry. In addition,
your Company has reaped the benefits of enhanced
capacities and economies of scale along with an expanded
network and product portfolio.
As a result, in this period, your Company achieved a
production of 119,098 tractors. In addition, 52,131 engines
were produced for the Mahindra Powerol brand. Following
the merger, the two tractor manufacturing plants of the
erstwhile PTL at Mohali and Chappercheri along with its
foundry facility at Sialba Majri, near Mohali, stands added
to the existing tractor manufacturing plants of your
Company at Rudrapur, Nagpur, Kandivali and Jaipur.
Your Company recorded sales of 120,202 tractors against
99,042 tractors sold in the previous year. This included
domestic tractor sales of 113,269 tractors - a growth of
25.1%, compared to 90,509 tractors sold in the previous
year, against the backdrop of a flat industry scenario. In
the farm mechanization space, besides tractors, your
MAHINDRA & MAHINDRA LIMITED
Company sold farm implements and other equipment under
both the ‘Mahindra’ and the ‘Swaraj’ brand. The Swaraj
Division plant at Chappercheri is also an established
producer of Harvester combines in the organized sector in
India.
In 2008, under the Mahindra brand, your Company had
launched the 295 DI Super Turbo tractors in the 30 to 40
HP segment, in a few select states. This model has been
well appreciated by the customers for its fuel efficiency
and power and this year 295DI was offered across the
country. Upgraded models of the large selling 475DI and
575DI models were also introduced.
The Arjun Ultra-1 has now been transformed into a versatile
product which has demonstrated superlative performance
both on and off the field. The Mahindra Shaan - a 25 HP
multi-utility tractor launched by your Company in 2007 -
has proved very successful in the brick kiln segment.
Your Company is the first tractor manufacturer in the
country to offer radial tyres with its tractors. Under the
‘Swaraj’ brand, a new series called “XM” (Xtra Mileage)
has been launched, which has a better fuel efficiency, new
look and added features of convenience and comfort. This
has been well received in the market. To cater to the
market requirement in the less than 30 HP segment, the
Company has re-launched model 722 Super with
improvements in ergonomics, steering effort, operator
comfort and usability.
FES has been awarded the prestigious Golden Peacock
Award ’08 in the Innovative Product/Services category for
its in-house development of a Load Car, the first of its kind
in Indian tractor industry.
Two of its advertising campaigns (for ‘Bhoomiputra 235
DI’ and ‘Arjun Ultra-1’) won Golds at the 2nd Rural
Marketing Awards, organised by the Rural Marketing
Association of India (RMAI). FES also bagged five awards,
33
the most by a single brand, at the 1st WoW Awards
organised by EventFaqs - a renowned web portal, to
celebrate excellence in Events and Experiential Marketing.
Your Company has launched a unique initiative called
Samriddhi that aims to bring the latest innovative farming
technologies within the reach of the Indian farmer. This
initiative includes soil and water testing labs, productivity
demo farms, agri-clinics and counselling centres. One of
the projects under this program - ‘Project Bhoomi’ - (Mobile
Soil Testing Laboratory), was awarded the ‘Order of Merit’
by the Promotion Marketing Awards of Asia ‘08 fraternity
in the category of ‘Best Cause’ Campaign.
Your Company’s tractors are now being sold in 6 continents
of the world. The Company has continued to focus on the
African states. Africa is one of your Company’s largest
export markets apart from the US. Your Company has set
up an assembly plant in Ghana, inaugurated by the
President of that country. This is in addition to the assembly
plants set up in Tchad and Mali, Nigeria and Gambia last
year. This year, your Company has made forays into the
new African markets of Botswana, Egypt, Niger, Congo
and Brazzaville. To meet the demand of the higher HP
segment in Africa, your Company launched the Mahindra
705DI as a ‘value for money’ offering in the 70 HP segment.
The 8000 tractor series was launched in Africa in 2008.
The product’s success has now led to its introduction in
Latin America and Australia.
Other new markets were Yemen in the Middle East,
Cambodia in South East Asia and Argentina in Latin
America. Under the Mahindra brand, the compact range
of tractors (35 series) was introduced by your Company in
the US market and in ANZ. The neighbouring countries of
Sri Lanka, Bangladesh and Nepal continue to be large
overseas markets for your Company. As a result of the
global economic slowdown, your Company exported 6,933
tractors i.e. 19% less than last year.
34
Your Company has strengthened its presence in the growing
Chinese tractor market by entering into a JV in China with
the Chinese Jiangsu Yueda Group. This is your Company’s
2nd JV in China. The JV’s manufacturing facility is located
in Yancheng city, Jiangsu Province and sells tractors under
the Jinma brand. Jinma’s product portfolio includes tractors
ranging from 16 - 125 HP. The new entity is named
Mahindra Yueda (Yancheng) Tractor Company Limited
(MYYTCL).
Your Company’s first JV in China, Mahindra (China) Tractor
Company Ltd. (MCTCL) was able to grow by 21% over the
previous year despite the stagnant industry situation. This
was enabled through the launch of Mahindra branded red
tractors in the domestic market and the expansion of the
product range up to the 40HP segment on the current
platform. This year, MCTCL made the change over from
selling tractors under the MCTCL Feng Shou brand to the
new Mahindra Feng Shou brand. In line with the Mahindra
strategy of customer service as a differentiating factor,
MCTCL launched customer support initiatives to support
Mahindra brand. MCTCL has embarked on a new product
development program to expand into higher HP segments.
Products up to 55HP are being seeded in select domestic
markets before commercial launch in the next financial
year. On the exports front, MCTCL opened up new markets
in East Europe, Africa and Iran and has also completed
product homologation for European markets. All these
initiatives will enable MCTCL to gain a significant presence
in the China tractor industry.
In the US, the 0-80 HP tractor industry declined by 16%
between April 2007 and March 2008. The economic crisis
and the collapse of the housing market are the prime
reasons. In this challenging environment, the sales of
Mahindra USA Inc. (MUSA) declined by 32 %. On a positive
note, MUSA was rated highest in Overall Satisfaction
amongst dealers in the US market, in a survey conducted

by North American Equipment Dealers Association. This is
a significant achievement in a market in which every leading
global tractor manufacturer has a presence.
Under the Mahindra Powerol brand, your Company has
sold 52,350 engines in this financial year, as against 31,922
engines last year - a growth of 64%. Mahindra Powerol
has retained its leadership position in the genset market
that caters to the telecom industry adding prestigious clients
to its list such as Indus Towers, Xcel Telecom, TCS, 3i
Infotech, Nutek, Barista, Tanishq, Levis, Kotak Life and
Maharashtra State Road Transport Corporation (MSRTC).
To ensure a high degree of interaction with corporate
customers, your Company has introduced the web based
MAGIEC interface.
Your Company expanded the Mahindra Powerol genset
product range from the prevalent 62.5 kVA to 140 kVA. In
addition, it has also launched engines for cranes,
locomotives and marine applications. Mahindra Powerol
also has a presence in the retail segment, with 55 branded
show-rooms operated across India. Mahindra Powerol has
initiated exports to Nepal, Bangladesh, UAE and Brazil. It
opened its first international showroom in Kathmandu.
After winning the most coveted International Quality
accolades – the Deming Prize and the Japan Quality Medal
- FES has continued on the TQM path with its own
Assessment Model - the Mahindra Excellence Model. To
further strengthen its manufacturing capability, the sector
is pursuing the path of Total Productive Maintenance (TPM)
under the guidance of Japan Institute of Plant Maintenance.
The rich TQM experience of FES is now horizontally
deployed in the Swaraj Division to accelerate the
implementation of best practices. The FES journey towards
business excellence continues with unabated vigour.
Plants of the Mahindra and Swaraj division are already
certified for various internationally recognized Quality and
MAHINDRA & MAHINDRA LIMITED
Safety Management Systems. From this year, the Powerol
Business is also covered under certification for the ISO
9000: 2000.
Opportunities
The Automotive Sector
Despite the recent slowdown in economic growth, the
Indian economy is poised to show robust growth in the
medium to long term. With the economy on a high growth
path on a secured long-term basis and with the consequent
increase in disposable incomes of the population at large,
the Indian automotive industry is expected to provide
significant growth opportunities. India’s automotive sector
is expected to be one of the fastest growing in the world
over the next several years. The Indian Government’s
Automotive Mission Plan 2016 (AMP 2016) will facilitate
such growth and targets a doubling of the automotive
industry’s contribution to the Indian economy between
2006-2016.
Your Company is investing significant resources towards
expansion of its technological and product development
capabilities to actively participate in the expected growth
of the Indian economy. Your Company also continues to
actively search for overseas partners and markets, to
supplement and strengthen its domestic market, in both
sectors. The sectors also share synergies of resources,
especially for sourcing, giving major opportunities for
savings. Your Company has expanded its participation in
the Indian automotive industry thorough its joint ventures
for CVs and cars, as well with its entry into two-wheelers
and three-wheeler categories. As a result, the Company is
well poised to garner an increasing share of this segment
of the Indian economy which is expected to show relatively
high growth over the long term. While the near term may
be challenging, with sluggish growth due to global and
local economic pressures as listed under the next section,
the long term outlook is positive.
35
In the Automotive Sector, the Company believes that its
core MUV market is likely to increase its share in the light
vehicles category due to the inherent versatility of MUVs.
The proportion of MUVs in India is relatively low compared
to corresponding figures in Asian countries that share a
similar or more developed economic and demographic
profile. In the long term, the Company believes that the
light vehicle market will expand at a fast clip in India and
that MUVs will take an increasing share of this market.
The AMP 2016 also states that fiscal benefits should be
provided to MUVs, which could lead to further MUV
growth.
The increased investments in infrastructure required to
maintain the high growth of the Indian economy – such
as the National Highway Development Programme with a
budget of tens of thousands of crores - and the increased
goods movement in a fast growing economy would result
in a high demand for commercial vehicles. To capture a
share of the growing medium and heavy commercial
vehicles segment, the Company’s subsidiary, MNAL, will
launch a new range of medium and heavy commercial
vehicles over the next few years and thus ensure the
Company’s participation in this large and important
segment of the Indian automotive industry.
The WTO and Free Trade Area negotiations with Thailand,
ASEAN, SAARC countries and the Mercosur countries are
likely to lead to lowered tariffs in many of the Company’s
target export markets. This could provide a significant
opportunity to generate larger volumes from export sales
and further the Automotive Sector’s strategic emphasis on
the development of exports.
Through various strategic initiatives, the Automotive Sector
of the Company has put in place plans to increase the size
of its addressable market of the Indian automotive industry
from 17% in F-05 to 75% by F-10, providing a huge
opportunity for growth.
36
The Farm Equipment Sector
In a global economy faced with recessionary pressures, the
Indian economy has witnessed a slow down in growth.
Yet, the positives for your Company in such an environment,
is that the impact on the rural economy has been minimal.
With a large rural population base dependent on farming
and allied industries, agriculture will continue to be the
priority area for the Government. This coupled with
significantly lower levels of mechanization compared to
the global average, indicates that there is significant growth
potential for mechanization in the country, which your
Company is well poised to leverage.
Your Company’s Farm Equipment Sector will use every
opportunity to leverage both the Mahindra and Swaraj
brands, to create strong dealers, build better channel
efficiencies, develop cutting edge technologies and
introduce a continuous pipeline of product up-gradations
and new product introductions.
The US and China are amongst the top three tractor
markets in the world apart from India. To tap the potential
in these markets, FES plans to continue its focus on these
markets to become a global leader. The Chinese
Government policies encouraging agriculture have provided
the Company good opportunities as demonstrated by the
2nd JV in China. Similarly, your Company is also exploring
various global tractor markets in Africa, East Europe, South
America and South East Asia. The improved stability and
economic growth in smaller African countries have provided
the Company good opportunities to expand exports and
collaborate with local Governments by helping them set
up tractor assembly plants for the Company’s SKD exports.
Your Company’s strategy to make use of low cost
manufacturing & sourcing bases in India and abroad will
enhance its cost competitiveness.

Threats
There is a strong linkage between the automotive industry,
the economy and consumer sentiment. A prolonged
slowdown in the Indian economy would therefore impact
the near term growth prospects for the automotive sector.
For the Farm Equipment business, a slowdown of the Indian
economy in the short term, given the current global
developments, and natural factors like weather, rainfall,
floods, natural calamities like El-Nino and economic factors
like high fuel prices increasing the running costs, may
directly impact the tractor industry.
The major threats for the automotive business could be:
Competition
Given the increased relative attractiveness of emerging
markets such as India, global players are likely to further
enhance their presence there. This would lead to higher
level of competition for your Company. The entry of new
players will result in ever increasing levels of competition
in all the segments of the automobile industry, resulting in
intense pressure on the profit margins of all participants.
The Company is countering this threat by a stronger focus
on reducing costs and increasing efficiency of operations.
Regulations
For the Automotive Sector, more stringent regulatory norms
are being introduced, especially in the areas of safety and
emission. While these measures are welcome, they may
result in an increase in manufacturing cost, which in turn,
may affect margins or demand in a market which is
intensely competitive and customers who are price sensitive.
Recently, the tax levy differential between small cars and
larger vehicles has increased. With a resulting lower price
tag for small cars, customers on the margin may opt to
postpone large car purchases or buy a small car, which
could impact MUV and the larger car segment growth.
MAHINDRA & MAHINDRA LIMITED
With the Company’s strong focus on globalisation, any
form of tariff or non-tariff barriers imposed by any country
where the Company has a significant presence, or has
plans to grow, will be a threat to its prospects. As for all
exporters, any political, economic uncertainty or natural
calamity in the countries of export would be a potential
threat.
Common threats to the Automotive as well as Farm
Equipment businesses could be:
Financial market conditions
Tightening of credit disbursals for vehicles and increase in
interest rates impacted demand in many segments in F-
09. Any adverse change in these factors would impact
demand in the current year and this may affect sales
volumes, leading to lower profitability. However having a
subsidiary company, Mahindra & Mahindra Financial
Services Limited alleviates this concern to some extent.
The Company’s exports, a strong thrust area, can be
adversely affected by currency fluctuations.
In the US market, the US economic slowdown has directly
impacted the spending propensity of the customer
segments for Mahindra’s range of tractors. The tractor
industry has itself contracted by about 20% last year and
is forecast to contract by close to a similar level this year.
This has significantly impacted MUSA’s business.
The Maoist insurgency and political instability in Nepal has
been affecting the Company’s exports to that country.
Fuel prices and alternate fuels
High fuel prices increase the cost of ownership and could
also adversely impact demand for both Sectors. Any
reduction in the price differential between petrol and diesel
could increase demand for petrol MUVs at the expense of
37
diesel MUVs. Almost all of the Company’s MUV models
are diesel powered and an increase in preference for petrol
vehicles could be a disadvantage to the Company. The
cost of diesel also constitutes around 60% of the running
cost of a tractor. Any sharp upsides in the price of diesel
may adversely impact input costs for farmers. However,
going by the previous experience, the price control on
fuels employed by the Government minimizes these risks
to a substantial degree.
Mandatory use of vehicles powered by alternative energy
sources could affect both the Sectors. For the Automotive
Sector, it could lead to a demand for different types of
vehicles. The Company has developed products powered
by alternate energy like CNG and electricity to provide
lower polluting products for a better environment, which
minimizes this risk. The Company has also developed
prototypes of a hybrid Scorpio and hydrogen powered
three-wheeler as well as a bio diesel powered Scorpio and
Bolero. The Company is thus well placed to move with the
trend towards alternative energy in both the Sectors, should
it become a norm in future. For instance, in F-09, the
Company introduced micro hybrids in mainstream models
with the path-breaking FuelSmart system on its Scorpio
and Bolero SUVs. FuelSmart technology enables the engine
to shut off automatically at traffic junctions, when idling
or when in neutral gear, thus saving fuel. The engine starts
seamlessly when the driver depresses the clutch to move
forward.
For the Farm Equipment Sector it could lead to a demand
for different types of tractors. To minimize this risk, FES is
customizing products powered by alternate energy like bio
diesel. Your Company has successfully developed engines
capable of running on B100 grade diesel. The Company is
therefore well placed to move with the trend towards
green fuels in both the Sectors, should it become a norm
in future.
38
Commodity Prices
A major threat to both the Sectors lies in the escalation of
raw material prices. Such price hikes, especially for iron,
steel and rubber are likely to put pressure on prices and
could affect margins or demand. Although commodity
prices have recently declined after peaking in the first half
of F-09, the near to medium term remains unclear given
the uncertainties in the global macro-economic
environment. Any rise in the commodity prices will result
in a rise in input costs, in turn causing price escalation.
This may therefore impact demand with a consequent
impact on the bottom-line if not passed on. The Company’s
Automotive Sector continued to be amongst the most
aggressive in passing on these costs to consumers, but
may not be able to always do so in the future.
Apart from this, a steep increase in crude oil prices globally,
has an inflationary impact on the overall economy.
Risks and Concerns
With the growing integration of the Indian economy with
the Global economy, events around the world have a direct
or indirect impact on the Indian automobile industry. In
particular, Indian financial markets are highly integrated to
global financial markets. As a result, liquidity and availability
of credit, an important facilitator for automobile and tractor
sales in the Indian market, will be impacted by conditions
in the Global markets.
Stringent legislation on pollution and emission requirements
will increase the cost of the Company’s products for the
Automotive Sector. Holding the price line could have an
impact on profitability. Price increases on the other hand
could impact volumes.
The Automotive Sector is in the process of setting up a
new greenfield plant at Chakan, near Pune with significant
investments made by the Company. With the addition of
the full capacity of this new plant, the dedicated final

capacity will significantly increase as compared to its current
capacity. If owing to lower than expected demand for its
products, the utilisation of this increased capacity is below
optimal level, the increased fixed costs would impact
profitability in the future. The Company plans to bring in
the incremental capacity from this new plant, phase wise
to protect it from this risk.
In the domestic tractor market, growing NPAs of banks
are a concern for FES, as this puts pressure on fresh loans
and new tractors sales to the farmers, 80 % to 90% of
whom buy tractors against loans. Interest rates for tractor
loans tend to be higher than for housing and car loans.
High interest rates have prevailed throughout the year under
review. If interest rates remain at these levels there could
be an impact on the loan repayment ability of farmers,
thus impacting tractor demand.
For the overseas operations, rupee appreciation could be a
risk for both the Sectors. However, the Company as a
practice, is taking appropriate steps to hedge currency
exposure thus limiting the impact of risk. Both Sectors will
continue to focus on cost cutting measures through value
engineering.
With growing competition for acquisition and retention of
talent, which is ever more important to retain the
Company’s competitive position in the market, availability
of technical and managerial resources at reasonable cost
is an important risk factor
Excise matters
In 1991, an excise dispute arose at the Nashik and Kandivli
factories of the Automotive Sector relating to the
Commander range of ten-seater vehicles manufactured at
these factories. The jurisdictional Central Excise authorities,
after due inquiry, approved the classification of these
vehicles as ten-seaters which attracted a lower rate of
excise duty under Tariff Entry 8702. The Company
MAHINDRA & MAHINDRA LIMITED
successfully contested the subsequent challenge by the
excise authorities, in two different fora. The Excise
Department accepted these decisions and the classification
of the vehicle as a ten-seater was consistently approved by
the authorities. In spite of the above, the Excise Department
subsequently disputed the classification on the ground that
classification of the Commander under Tariff Entry 8702
as ten-seater did not meet certain parameters of the Motor
Vehicles Act, 1988 and the Maharashtra Motor Vehicles
Rules, 1989, and demanded differential duty. The
Department’s stand was that the Commander should be
classified under Tariff Entry 8703, attracting a higher rate
of excise duty. The Company challenged these demands by
writ petitions before the Bombay High Court, which
remanded these matters for adjudication by the Excise
authorities. The Commissioner (Adjudication), Navi Mumbai
passed an order dated 30th March 2005 confirming the
demand of Rs.216.03 crores and imposed a penalty of Rs.
88.08 crores. The Company has filed an appeal and a stay
application in the Tribunal challenging this order. The
Tribunal has granted an unconditional stay against the
demand and penalty in terms of its order dated 9th October
2007.
In another concurrent proceeding, the Tribunal passed an
order in July 2005 holding that the vehicles were
appropriately classifiable under Tariff Entry 8702 as ten-
seaters. The Department has challenged this order by filing
a Civil Appeal, before the Supreme Court, which has been
admitted. The matter is yet to be finally heard. The
Company does not expect any liability on this account as it
has been advised that an extraneous legislation like the
Motor Vehicles Act cannot be referred to for the purpose
of excise classification. The Excise Commissioners, the
Tribunal and various expert/statutory bodies holding the
vehicle to be a ten-seater have accepted this stand. Apart
from the above, the Commissioner of Central Excise, Nashik
has also confirmed a demand of Rs. 24.55 crores and
39
imposed a penalty of Rs.20 lakhs in respect of “Armada”
range of vehicles manufactured by its Nashik Unit during
the period 1992 to 1996, on the same basis as adopted
for Commander range of vehicles. The Tribunal was pleased
to grant an unconditional stay against this order as well.
The final hearing in both the above matters is awaited.
Outlook
There is a strong linkage between the strength of the
automotive industry and the strength of the economy of a
country. High growth of the industry, through its forward
and backward linkages, leads to accelerated growth of the
economy, which in turn leads to a higher growth for the
automotive industry in a virtuous cycle. After six years of
rapid growth, Indian economy and the automotive industry
slowed down significantly in F-09. Despite this, the Indian
automotive industry was and is likely to remain one of the
fastest growing automotive industries in the world.
In the medium term, the Indian economy is projected to
return to brisk growth and demand conditions, in the
medium to long term, are expected to remain strong.
However, in the near term, due to continued uncertainties
in the global and domestic macro-economic environment,
the outlook for the automobile industry is one of cautious
optimism. While there are positive developments such as
increased pay of Central Government Employees (as part
of Sixth Pay Commission recommendations), lower inflation,
lower interest rates and softer commodity prices, there are
also significant challenges stemming from slowing
economic growth, lower business and consumer confidence
and tightening of credit standards.
In this environment, your Company is banking upon new
products to maintain its sales momentum. The recently
launched Mahindra Xylo (Project Ingenio) and the refreshed
Scorpio which have received encouraging response in the
market place would be a key contributor to the Company’s
40
MUV sales in F-10. In addition, the Company will also
launch new products to address previously unaddressed
market segments.
Given the overall thrust on agricultural development by
the Government, the scenario for FES is encouraging. For
F-09, the Government of India has proposed to allocate
Rs. 2.8 lakh crores for agricultural credit, which is expected
to give a boost to the tractor industry. Moreover, there is a
strong focus on irrigation projects and investment for
development of rainless areas with an outlay of Rs. 20,000
crores. The Government’s emphasis on rural economic
development and support to the agriculture sector will
create opportunities for growth in farm mechanization.
In the international market, FES plans to expand aggressively
into newer markets and strengthen its presence in existing
markets.
Both sectors with their updated product portfolios and
their exploration of global horizons, will strive to maintain
their leadership position. Simultaneously, the Company will
continue its focus on achieving cost leadership through
focused cost optimization, value engineering, improved
efficiency measures like supply chain management,
countrywide connectivity of all its suppliers and dealers,
and exploiting synergies between its Sectors.
Material Developments in Human Resources/
Industrial Relations
The long-term objective of all HR / IR is to create a culture
of sustained business outperformance accompanied by
extreme care for all stakeholders, while sustaining and
strengthening the core values of the Group.
Given the business imperatives in the current economic
slowdown, the focus during the year was on aligning all
HR levers to support the initiatives for cost control and
conservation of cash, while creating the required capabilities

in the workforce and ensuring organizational confidence
and employee motivation that would enable the Company
to face current challenges and seize future opportunities.
A major challenge was to find a sense of balance between
the short and the long term, and to honour the Triple
Bottom Line of profit, people and planet.
The focus on cost control from the HR perspective resulted
in changes in the organization structure and work design,
a review of the number of employees along with salary
levels and incentive schemes, and the right level and mix
of skills.
The focus on making Mahindra a Great Place to Work
continued through significant improvements in physical
infrastructure and work place ambience, employee
engagement, and harnessing the power of IT. Specific
employee engagement initiatives were either introduced
or intensified, and continue to be tracked by the Gallup
Engagement Index.
Performance Management continued to be the backbone
of all HR activities, and goal-setting received a lot of focus
in the year under review.
The Talent Management process has grown in strength
during the year. Succession planning for critical positions,
use of development centres and creating a large number
of coaches and mentors, continued to be high on the
priority list, along with cross-business rotation of employees.
Pre-merger HR diligence and post-merger integration were
important activities, both for domestic as well as global
acquisitions.
The training centre at Bodhi Vriksha in Nashik has been
humming with activity with both the Mahindra
Management Development Centre (MMDC) and the
Mahindra Institute of Quality (MIQ) working closely with
businesses to create the competencies required for the
MAHINDRA & MAHINDRA LIMITED
success of strategic business plans. Special mention needs
to be made of the Mahindra Quality Way, a process that is
being embraced by businesses across the Group. In
addition, technical and functional programmes are
conducted by the businesses, where the use of e-learning
portals is increasing exponentially.
Employer Branding as a formal process took a big leap
forward with the “War Room” an event in which 16 of the
top Business Schools of India participated through 784
teams and over 3000 students. The Company believes this
has already impacted the Mahindra Brand in this
community, with the Company getting a slot on day one
in most campuses visited for hiring.
CSR and employee volunteering through the Employee
Social Option activities are an important element of the
Mahindra culture. The number of volunteers has reached
14500, and activities continue to focus on education (with
special emphasis on the girl child), the environment and
public health. Special mention needs to be made of the
Mahindra Hariyali project through which Mahindra Group
planted 1.2 million trees in the past year.
In the Automotive Sector, Industrial Relations remained
cordial and harmonious during the year under review.
Various training programs were organized at all plants for
developing personal, interpersonal and technical skills of
the workmen. These training programs covered a wide
range of topics including Positive Attitude, Stress
Management, Creativity, Team Effectiveness, Safety and
Environment, Quality Tools, TPM, Dexterity and Technical
training. The workmen wholeheartedly participated in all
training programs and in many cases on a holiday or after
working hours.
Workmen at all locations are involved in driving
improvement activities. For the year under review, a total
of over 42,000 suggestions were implemented which is a
record for the Automotive Sector.
41
FES saw cordial industrial relations at all its locations &
area offices during the year. Manpower utilization was at
an effective level of almost 100%, barring the slack months
of December and January, when production cuts were
necessary to respond to the market situation following the
global economic meltdown. Employee communication,
through ‘Reach Out’ – a two way internal communication
process – played an important role in rallying employee
enthusiasm and performance, despite the challenging
circumstances.
The integration of acquired companies was an important
activity requiring intense HR inputs. Of particular note,
was the swift and smooth harmonization and rolling out
of key HR processes and policies in the ‘Swaraj Division’
post the merger with your Company.
At FES, the workmen participation continued to be major
thrust area under the ‘Akraman’ (War on Waste) movement,
while the Yellow Belt programme encouraged officers to
acquire proficiency in Systematic problem solving and
demonstrate its application through successful completion
of complex projects. Both these programmes have
contributed to system improvements and cost savings.
To create a vibrant workplace, both the Sectors embarked
on the ‘Fun at Workplace’ initiative through sector-wide
plant and department centric events, sometimes involving
families of employees.
The permanent Employee strength of the Company as on
31st March, 2009 was 16094.
Internal Control Systems
The Company maintains adequate internal control systems,
which provide, among other things, reasonable assurance
of recording the transactions of its operations in all material
respects and of providing protection against significant
misuse or loss of Company assets. The Company uses an
Enterprise Resource Planning (ERP) package, which
enhances the internal control mechanism. The Company
42
has a strong and independent internal audit function. The
Chief Internal Auditor reports directly to the Chairman of
the Board. Professionally qualified, technical and financial
personnel of the internal audit function conduct periodic
audits to ensure that the Company’s internal control
systems are adequate and are complied with.
Discussion on Financial Performance with respect
to Operational Performance
Overview
The financial statements have been prepared in compliance
with the requirements of the Companies Act, 1956, and
Generally Accepted Accounting Principles (GAAP) in India.
The Group’s consolidated financial statements have been
prepared in compliance with the standard AS 21 on
Consolidation of Accounts and presented in a separate
section of the Annual Report. The Company has provided
segment reporting on a consolidated basis as per standard
AS 17 on segment reporting. This information appears
along with the consolidated accounts.
Financial Information
1. Fixed Assets:
As at 31st March, 2009 the Gross Block of Fixed Assets
and Capital Work in Progress was Rs. 5,540.62 crores as
compared to Rs. 4,202.58 crores as at 31st March, 2008.
During the year, the Company incurred capital expenditure
of Rs. 895.90 crores (previous year Rs. 754.27 crores). The
major items of capital expenditure were on New Product
Development, Capacity Enhancement, and Research &
Development. This included purchase of Intangible assets
aggregating Rs.169.86 crores (previous year Rs.71.42
crores). The Gross Block for the year has also increased by
Rs.308.71 crores on account of the additions of Fixed
Assets due to the merger of Punjab tractors Limited (PTL)
with the Company.
 MAHINDRA & MAHINDRA LIMITED

2. Inventories:

March 31, 2009 March 31, 2008

Raw materials and bought out components as a % of consumption 4.46% 4.66%

Finished goods as a % of gross sales 3.31% 4.68%

The reduction in inventory levels is due to focus on supply chain management and better planning and control.

Sundry Debtors:

Sundry debtors amount to Rs. 1,043.65 crores as at March 31, 2009, as compared with Rs. 1,004.88 crores as at March
31, 2008. Debtors as a percentage of gross sales and income from operations are 7.09% for the year ended March 31,
2009, as compared to 7.67% for the previous year. The Company has been able to achieve this improvement in its
debtors level due to its proactive emphasis on collections.

Results of Operations
Income : (Rupees crores)

Particulars F – 2009 F – 2008 Inc./(Dec.)

Amount % Amount % %

Gross Sales 14,268.41 112.80 12,371.03 114.50 15.34

Less : Excise Duty on Sales 1,619.35 12.80 1,566.39 14.50 3.38

Net Sales 12,649.06 100.00 10,804.64 100.00 17.07

Income from Operations 444.62 3.52 736.63 6.82 (39.64)

Other Income 270.34 2.14 130.37 1.21 107.36

Income from Operations & Other Income:

The income from operations in the current year is lower mainly on account of the transfer of the Company’s logistics
business to its wholly owned subsidiary from the beginning of the current year. Other income during F-2009 at
Rs.270.34 crores is more than double of Rs.130.37 crores earned in the previous year. This increase is on account of
higher dividends received from the subsidiaries, profit on sale of Swaraj Mazda shares and higher income from increased
level of surplus funds arising from the PTL merger.

43
Expenditure: (Rupees Crores)

Particulars F – 2009 F – 2008 Inc./(Dec.)

Amount % to Net Amount % to Net %

Sales & Income Sales & Income

from Operations from Operations

Raw materials, Finished and

Semi-finished Products 9,274.23 70.83 7,725.91 66.94 20.04

Personnel expenses 1,024.61 7.83 868.14 7.52 18.02

Interest, commitment and finance charges 45.26 0.35 24.24 0.21 86.72

Depreciation/Amortisation 291.51 2.23 238.66 2.07 22.14

Other expenses 1,702.21 13.00 1,580.65 13.70 7.69

Total Expenditure 12,337.82 94.23 10,437.60 90.44 18.21

The total expenditure during the year as a percentage of
Net sales / Income from Operations is 94.23% as compared
to 90.44 % in the previous year.
Material Cost :
For the year ended March 31, 2009, material cost as a
percentage of net sales shows an increase over the previous
year mainly due to the significant increases in material
costs in the first half of the current year, lower closing
inventory and lower income from operations due to the
transfer of logistics business.
Personnel Cost :
Personnel cost as a percentage of sales has increased from
7.52 % to 7.83 %. This is mainly due to increase in officers’
strength, annual increments and refinements in actuarial
assumptions affecting calculation of gratuity.
Other Expenses :
Other expenses as a percentage of net sales shows a
decrease over the previous year as a percentage to net
sales and operating income mainly due to the freight cost
reduction on transfer of logistics business. However, the
expenses in absolute terms are higher due to losses on
account of forward cover cancellations arising from lower
than planned exports due to global recession and increase
in professional fees on acquisitions, corporate branding,
etc.
Depreciation :
The depreciation for the year ended March 31, 2009 is at
Rs. 291.51 crores as compared to Rs. 238.66 crores in the
previous year due to capitalization of the Xylo related assets
and the increase in amortization of intangibles in the
current year.
Interest (Net) :
The interest expense of Rs.45.26 crores (net of interest
income of Rs.134.12 crores) for the year ended March 31,
2009 is higher than the interest expense of Rs.24.24 crores

44

(net of interest income of Rs.87.59 crores) in the previous
year due to increased borrowings to meet the Company’s
capital expenditure and other growth plans.
Exceptional Items :
The profit from Exceptional items during the year ended
31st March, 2009 is Rs.10.27 crores as against Rs.172.73
crores last year. The profit in the current year is on
account of surplus on transfer of the Company’s logistics
business to its wholly owned subsidiary. In the previous
year, the profit was due to the gain from the valuation
of certain shares received by the Company under two
court approved merger schemes at the fair value of the
shares parted with in exchange for them.
Provision for taxation :
The provision for current tax, fringe benefit tax and
deferred tax for the year ended 31st March, 2009 as a
percentage to profit before tax is lower than the previous
year, on account of a higher tax-free dividend income
during the year and increased profits in a new plant
eligible for deduction under Section 80IC of the Income-
tax Act, 1961.
Consolidated Financial Position of the M&M
Group
During the year, the Group acquired Metalcastello S.p.A
and Engines Engineering S.r.l both of which became
subsidiaries of the Company. In addition to these, the
Company also acquired the two wheeler business of
Kinetic Motor Company Ltd., through its newly formed
subsidiary Mahindra Two Wheelers Ltd. During the year,
two of the Company’s subsidiaries Mahindra Holdings
& Finance Limited and Punjab Tractors Limited, merged
with the Company under two separate Schemes of
Amalgamation approved by the High Courts of Bombay
st
and Punjab and Haryana. As on 31 March, 2009 the
MAHINDRA & MAHINDRA LIMITED
Group comprised of the flagship holding company,
Mahindra & Mahindra Limited, 97 Subsidiaries, 4 Joint
Ventures and 11 Associates engaged in various businesses.
The Gross turnover for the year ended 31st March 2009 of
Consolidated Mahindra Group is Rs.28,991.99 crores as
against Rs.26,600.11 crores for the previous year. The
Group’s net turnover grew by 10.12 % to Rs.26,919.81
crores in the current year from Rs.24,445.29 crores in the
previous year. The profit before exceptional items and tax
for the current year is Rs.2,330.51 crores as compared to
Rs.2,798.27 crores in the previous year. The Group results
were adversely affected by the downturn in the automotive
and auto-components industry the world over and the
consequent poor showing during the year of the Company’s
subsidiaries operating in these industries. The sharp
depreciation in the value of the Indian rupee also
contributed significantly to the overall decline in the Group
profits. During the year, there was an exceptional charge
of Rs.156.87 crores arising mainly on account of
impairment of assets of a group company and a profit of
Rs.86.29 crores on account of deemed divestiture of
Mahindra First Choice Wheels Ltd and Mahindra Residential
Developers Ltd and the divestment of the holding in
Mahindra Retail Pvt Ltd. The consolidated Group Profit for
the year after exceptional items, prior period adjustments
and tax and after deducting minority interests is Rs.1,405.41
crores as against Rs.1,571.12 crores earned last year.
The Group’s major IT subsidiary, Tech Mahindra Limited
(Consolidated), witnessed a Revenue growth of 14.38 %
with total income increasing from Rs. 3,870.50 crores last
year to Rs.4,426.90 crores in the current year. The profit
after tax before exceptional items for the year was Rs.
1,014.56 crores as compared to Rs.769.50 crores in the
previous year – an increase of 31.85 %.
The Group’s Finance company, Mahindra & Mahindra
Financial Services Limited, despite interest volatility, credit
45
squeeze and stiff competition, achieved a 12.87 % growth
in its total income from Rs. 1,226.80 crores to Rs. 1,384.66
crores. It is one of the leading NBFCs in financing of four
wheelers and its profit after tax grew by 21.18 % from Rs.
177.02 crores in the previous year to Rs. 214.52 crores in
the current year.
Mahindra Holidays and Resorts India Ltd., during the year
under review, continued to grow towards dominance in
the Holiday Segment with membership growing by 26.24%
from 73,533 numbers to 92,825 numbers. The total income
grew by 18.47% from Rs. 375.04 crores to Rs. 444.31
crores. The profit after tax for the year registered a modest
increase from Rs. 80.52 crores in F-2008 to Rs 83.41 crores
in F-2009.

Segment Results

The results achieved by major business segments of the Group are given below:
(Rupees Crores)

Segments F-2009 F-2008

1. Automotive 100.85 741.25

2. Farm Equipment 667.85 603.49

3. Financial Services 333.91 279.14

4. Trading 94.80 88.32

5. Infrastructure 112.08 75.21

6. Hospitality 93.66 108.47

7. IT Services 1,126.28 361.92

8. Systech 21.18 199.74

9. Others (46.71) 118.83

Certain statements in the Management Discussion and Analysis describing the Company’s objectives, projections, estimates,
expectations or predictions may be “forward-looking statements” within the meaning of applicable securities laws and
regulations. Actual results could differ from those expressed or implied. Important factors that could make a difference to
the Company’s operations include raw material availability and prices, cyclical demand and pricing in the Company’s
principal markets, changes in Government regulations, tax regimes, economic developments within India and the countries
in which the Company conducts business and other incidental factors.

46

Corporate Governance
Your Company is committed to transparency in all its
dealings and places high emphasis on business ethics. It is
committed to all its Stakeholders including fulfilling its
Societal obligations. The Company is of the view that good
governance goes beyond good working results and financial
propriety and is a pre-requisite to attainment of excellent
performance in terms of stakeholder value creation.
Your Company practices a culture that is built on core
values and ethics. During the year your Company received
the National Award for Excellence in Corporate Governance
from The Institute of Company Secretaries of India
highlighting the good Corporate Governance systems and
practices adhered to by the Company. CRISIL has also
re-affirmed the highest level rating (Level 1) for Governance
and Value Creation. This rating indicates that the capability
of the Company with respect to wealth creation for all its
stakeholders while adopting strong Corporate Governance
practices is the highest.
A Report on compliance with the Code of Corporate
Governance as prescribed by the Securities and Exchange
Board of India and incorporated in the Listing Agreement
is given below.
I. Board of Directors
The composition of the Board is in total conformity with
Clause 49 of the Listing Agreement, as amended from
time to time. The Non–Executive Chairman of the Company
is a Promoter and the number of Non-Executive
Independent Directors is more than one-half of the total
number of Directors. The Board reviews and approves
strategy and oversees the results of management to ensure
that the long term objectives of enhancing stakeholders’
value are met.
MAHINDRA & MAHINDRA LIMITED
The Vice-Chairman & Managing Director and the two
Executive Directors are Whole-time Directors. The Chairman
and the Vice-Chairman & Managing Director, though
professional Directors in their individual capacities, belong
to the Company’s promoter group. The remaining Non-
Executive Directors (including the Nominee Director) are
Independent Directors and have the requisite qualifications
and experience in general corporate management, finance,
banking, insurance and other allied fields which enable
them to contribute effectively to the Company in their
capacity as Independent Directors.
Apart from reimbursement of expenses incurred in the
discharge of their duties, the remuneration that these
Directors would be entitled under the Companies Act, 1956
as Non-Executive Directors and the remuneration that a
Director may receive for professional services rendered to
the Company through a firm in which he is a partner,
none of these Directors has any other material pecuniary
relationships or transactions with the Company, its
Promoters, its Directors, its Senior Management or its
Subsidiaries and Associates which in their judgment would
affect their independence. None of the Directors of the
Company are inter-se related to each other.
Khaitan & Co., Advocates & Solicitors, in which Mr. R. K.
Kulkarni, Non-Executive Director is a partner, received
professional fees of Rs.85.63 lakhs.
The Senior Management have made disclosures to the
Board confirming that there are no material, financial and/
or commercial transactions between them and the
Company which could have potential conflict of interest
with the Company at large.
47
A. Composition of the Board the companies are given below. None of the Directors on
the Board is a Member on more than 10 Committees and
Currently, the Board comprises of twelve Directors. The
Chairman of more than 5 Committees (as specified in Clause
names and categories of Directors, the number of
49 of the Listing Agreement), across all the companies in
Directorships and Committee positions held by them in
which he is a Director:
Directors Category Total Number of Committee Memberships,
Chairmanships and Directorships of public
companies* as on 31st March, 2009
Committee Committee Directorships $
Memberships+ Chairmanships+
NON-EXECUTIVE

Mr. Keshub Mahindra Promoter 1 1 6

(Chairman)

Mr. Deepak S. Parekh Independent 7 5 13

Mr. N. B. Godrej Independent 3 1 14

Mr. M. M. Murugappan Independent 5 4 8

Mr. Narayanan Vaghul Independent 2 1 11

Dr. A. S. Ganguly Independent 2 1 5

Mr. R. K. Kulkarni Independent 7 2 9

Mr. Anupam Puri Independent 2 1 5

Mr. Arun Kanti Dasgupta** Independent 2 - 4

EXECUTIVE

Mr. Anand G. Mahindra Promoter 1 - 12

(Vice-Chairman &
Managing Director)

Mr. Bharat Doshi Non-independent 4 2 10

(Executive Director)
Mr. A. K. Nanda Non-independent 7 4 14
(Executive Director)

* Excludes private limited companies, foreign companies, companies registered under Section 25 of the Companies
Act, 1956 and government bodies.
+ Committees considered are Audit Committee and Shareholders/Investors Grievance Committee, including that of
Mahindra & Mahindra Limited.
$ Excludes Alternate Directorships but includes Additional Directorships and Directorship in Mahindra & Mahindra Limited.
** appointed with effect from 30th July, 2008.

48
 MAHINDRA & MAHINDRA LIMITED

B. Board Procedure provisions and write-offs, corporate restructuring, Minutes

A detailed Agenda folder is sent to each Director in advance
of Board and Committee Meetings. To enable the Board to
discharge its responsibilities effectively, the Vice-Chairman
& Managing Director apprises the Board at every Meeting
of the overall performance of the Company, followed by
presentations by the Sector Presidents. A detailed functional
report is also placed at Board Meetings. The Board also
inter alia reviews strategy and business plans, annual
operating and capital expenditure budgets, investment and
exposure limits, compliance reports of all laws applicable
to the Company, as well as steps taken by the Company to
rectify instances of non-compliances, review of major legal
issues, minutes of the Board Meetings of your Company’s
unlisted subsidiary companies, significant transactions and
arrangements entered into by the unlisted subsidiary
companies, adoption of quarterly/half-yearly/annual results,
significant labour issues, transactions pertaining to
purchase/disposal of property(ies), major accounting
of Meetings of the Audit and other Committees of the
Board, and information on recruitment of Officers just
below the Board level, including the Company Secretary
and Compliance Officer.
C. Number of Board Meetings, Attendance of the
Directors at Meetings of the Board and at the
Annual General Meeting
Seven Board Meetings were held during the year 1st April,
2008 to 31st March, 2009 on the following dates -3rd May,
2008, 28th May, 2008, 30th July, 2008, 29th October, 2008,
31st January, 2009, 13th February, 2009 and 26th March,
2009. The gap between two Meetings did not exceed four
months. These Meetings were well attended.
The Sixty-second Annual General Meeting (AGM) of the
Company was held on 30th July, 2008.
The attendance of the Directors at these Meetings is as under:

Directors Number of Board Attendance at the

Meetings Attended AGM
Mr. Keshub Mahindra 7 Yes
Mr. Anand G. Mahindra 5 Yes
Mr. Deepak S. Parekh 6 Yes
Mr. N. B. Godrej 5 Yes
Mr. M. M. Murugappan 4+ Yes
Mr. Bharat Doshi 6# Yes
Mr. A. K. Nanda 7 Yes
Mr. Narayanan Vaghul 5$ Yes
Dr. A. S. Ganguly 7 Yes
Mr. R. K. Kulkarni 6 Yes
Mr. Anupam Puri 5 Yes
Mr. Thomas Mathew T. * 1 No
Mr. Arun Kanti Dasgupta ** 4 Yes
* resigned with effect from 30th July, 2008.
** appointed with effect from 30th July, 2008.
+ In addition to attending four Board Meetings, Mr. Murugappan participated in two Board Meetings through
teleconference. No sitting fee was paid for participation through teleconference.
# In addition to six Board Meetings, Mr. Doshi participated in one Board Meeting through teleconference.
$ In addition to five Board Meetings, Mr. Vaghul participated in two Board Meetings through teleconference. No
sitting fee was paid for participation through teleconference.
49
D. Directors seeking appointment/re-appointment
Mr. Deepak S. Parekh, Mr. Bharat Doshi and Mr. Narayanan
Vaghul retire by rotation and, being eligible, have offered
themselves for re-appointment. Mr. Arun Kanti Dasgupta
has been appointed in the casual vacancy caused on
account of withdrawal of nomination of Mr. Thomas
Mathew T. representing Life Insurance Corporation of India
at the Meeting of the Board of Directors held on 30th July,
2008. Mr. Dasgupta holds office upto the date of
forthcoming Annual General Meeting as Mr. Mathew, in
whose place he has been appointed, would have retired
by rotation at the forthcoming Annual General Meeting. A
Notice has been received from a Member proposing the
candidature of Mr. Dasgupta for the office of Director.
Mr. Deepak S. Parekh
Mr. Deepak Parekh, is the Chairman of Housing Development
Finance Corporation Limited (HDFC), India’s premier Housing
Finance Institution. A Chartered Accountant by profession,
he has been with HDFC for 28 years. Under his leadership,
HDFC has grown from its humble beginning, into a financial
powerhouse with its activities diversifying into Banking, Asset
Management, Life Insurance, General Insurance, BPO, Credit
Bureau and Real Estate Venture Fund. The HDFC Group has
an asset base of over Rs.3,50,000 crores and a customer
base of over 3.5 crores.
Besides HDFC, Mr. Parekh is on the Board of several leading
Corporations across diverse sectors. He is the Non-Executive
Chairman of Infrastructure Development Finance Company
Limited, GlaxoSmithkline Pharmaceuticals Limited, Siemens
Limited and Lafarge India Private Limited. He is also the
Chairman of HDFC Asset Management Company Limited,
HDFC Ergo General Insurance Company Limited & HDFC
Standard Life Insurance Company Limited and Director of
Hindustan Unilever Limited, Hindustan Oil Exploration
Company Limited, Castrol India Limited, The Indian Hotels
Company Limited, WNS Global Services Private Limited and
Singapore Telecommunications Limited, along with being
the Alternate Director of Borax Morarji Limited, Zodiac
50
Clothing Company Limited, Bharat Bijlee Limited and Exide
Industries Limited. In addition, he is also nominated by the
Ministry of Corporate Affairs to the Board of Satyam
Computer Services Limited as a Special Director and
nominated by the Ministry of Civil Aviation to the Board of
Airports Authority of India.
Mr. Parekh is widely consulted by the Government on a
wide range of issues of national importance and has been
a member of various Government appointed committees
and advisory panels, which include financial services, capital
markets and infrastructure sector reforms.
As a member of the Investment Commission appointed by
the Government of India, the three-member committee is
expected to make recommendations to the Government
both on policies and procedures to facilitate greater FDI
inflows into India. He is Chairman of the Committee
appointed by the Ministry of Finance to make
recommendations on Infrastructure Financing, Chairman
of the High Level Task Force constituted by the Government
of India to look into various aspects of providing affordable
housing for all, Chairman of the Expert Group for
recommending investment norms for New Pension Scheme
(NPS) to be launched by the Pension Fund Regulatory &
Development Authority and member of the Audit Advisory
Board constituted by the Comptroller & Auditor General of
India (C&AG).
A recipient of the ‘Padma Bhushan’ in 2006, he has also
received several awards including the ‘IMC Juran Quality
Medal 2008’ for excellent customer-centric work in various
initiatives relating to the field of Banking & Finance by the
Indian Merchants Chamber (IMC), Outstanding Business
Leader of the Year 2008 by CNBC, NDTV Business Leader
of the Year Award – 2008, ’Life Time Achievement Award
2007’ by Finance Asia, ‘Best Non Executive Director 2006’
by the Asian Centre for Corporate Governance, ‘The
Economic Times Life Time Achievement Award’ in 2003,
the ‘JRD Corporate Leadership Award’ in 1997 and
‘Businessman of the Year’ by Business India in 1996.
 MAHINDRA & MAHINDRA LIMITED

Mr. Parekh is a Member of following Board Committees:

Sr. No. Name of the Company Name of Committee Position held

1. Mahindra & Mahindra Limited Audit Committee Chairman

2. The Indian Hotels Company Limited Audit Committee Member

3. GlaxoSmithkline Pharmaceuticals Limited Audit Committee Chairman

Investors Grievance Committee Chairman

4. Castrol India Limited Audit Committee Chairman

5. Hindustan Unilever Limited Audit Committee Chairman

6. Infrastructure Development Finance Company Remuneration Committee Member

Limited

7. Siemens Limited Remuneration Committee Member

Audit Committee Member

Mr. Deepak Parekh holds 52,754 Ordinary (Equity) Shares
in the Company.
Mr. Bharat Doshi
Mr. Bharat Doshi joined the Company in 1973 as an
Executive. He is a fellow member of The Institute of
Chartered Accountants of India and The Institute of
Company Secretaries of India and has a Master’s Degree
in Law from the University of Bombay. He has participated
in the Program for Management Development at Harvard
Business School. He was also a Fellow of the Salzburg
Seminar on ‘Asian Economies: Regional and Global
Relationships’ held in December, 2000. Mr. Doshi was
Executive Vice President (Corporate Affairs) from July, 1991
to August, 1992. In August, 1992, he joined the Board of
the Company as Executive Director in charge of Finance &
Accounts, Corporate Affairs and Information Technology.
In addition, he was the President of the Trade & Financial
Services Sector from December, 1994 to October, 2007.
Mr. Doshi is presently designated as Executive Director and
Group Chief Financial Officer (Group CFO). Mr. Doshi is
Chairman of Mahindra & Mahindra Financial Services
Limited and Mahindra Intertrade Limited. He is Director of
several companies in the Mahindra Group, including Tech
Mahindra Limited, Mahindra Holdings Limited, Mahindra
Navistar Automotives Limited, Mahindra Navistar Engines
Private Limited and Mahindra USA Incorporated and also
a Director of Mumbai Mantra Media Limited. He was also
a Director on the Board of Ford affiliate in India from May,
1997 to March, 2005.
He is an Independent Director on the Boards of Godrej
Consumer Products Limited and NSE.IT Limited.
He is a Trustee of the Mahindra Foundation and the K.C.
Mahindra Education Trust. He is also on the Board of
Governors of the Mahindra United World College of India.
He was a Member of the Board of Governors of Indian
Institute of Management, Kozhikode, from September,
1997 to March, 2008. He was a member of the Managing
Committee of Bombay Chamber of Commerce & Industry

51
from May, 2005 to May, 2007. He was one of the Founding
Members of the Governing Council of In Act (Indian
Association of Corporate CFOs & Treasurers).
Mr. Doshi was a member of the High Powered Expert
Committee constituted by the Ministry of Finance,
Government of India, on making Mumbai an International
Financial Centre and is a member of the SEBI (Securities
and Exchange Board of India) Committee on Disclosures
and Accounting Standards (SCODA).
Mr. Doshi is presently the Vice President of Bombay
Chamber of Commerce & Industry (BCCI), a premier
Business Chamber and President-elect for the year
2009-10.
Mr. Doshi has addressed at several international and
domestic fora on economic and management topics over
the years.
Recently, Mr. Doshi was invited to speak at the OECD’s
(Organisation for Economic Cooperation and Development)
EmNet (Emerging Market Networks) international
discussions meet in Paris on “Emerging Multinationals:
Partnering into New Markets” and “Closing the Emerging
World Infrastructure Gap: Is there a Role for the Private
Sector?”
Mr. Bharat Doshi was adjudged ‘India’s Best CFO’ by the
leading business fortnightly Business Today (India Today
Group Publication) in April, 2005. He was also conferred
the ‘CFO of the Year’ Award, honouring financial excellence,
instituted by IMA India, an associate of The Economist
Group, in December, 2005. In November, 2007, Mr. Bharat
Doshi was honoured with the prestigious CNBC CFO of
the Year 2007 award.

Mr. Doshi is a Member of following Board Committees:

Sr. No. Name of the Company Name of Committee Position held

1. Mahindra & Mahindra Limited Share Transfer and Shareholders/Investors Member
Grievance Committee
Loans & Investment Committee Member
Research & Development Committee Member
Corporate Social Responsibility Committee Member
2. Mahindra Intertrade Limited Compensation Committee Member
3. Mahindra Navistar Automotives Limited Audit Committee Chairman
4. Godrej Consumer Products Limited Audit Committee Chairman
Human Resource Committee Member
Nominations Committee Member
Compensation Committee Member
5. Mahindra & Mahindra Financial Services Limited Loans & Investment Committee Member
Compensation Committee Member
6. Mahindra Navistar Engines Private Limited Audit Committee Member
Remuneration Committee Member

Mr. Doshi holds 2,51,516 Ordinary (Equity) Shares in the Company.

52

Mr. Narayanan Vaghul
Mr. Narayanan Vaghul was Chairman of the Board of ICICI
Bank Limited till April, 2009. Mr. Vaghul joined ICICI in
1985 as Chairman and CEO and relinquished his position
as CEO in 1996. During his eleven years tenure as CEO,
ICICI was transformed from a small size long term credit
bank to a large diversified financial conglomerate. He was
instrumental in starting an investment bank, commercial
bank, venture capital company and an asset management
company, as part of the ICICI Group. He was also
responsible for the promotion of India’s first credit rating
company (CRISIL), which has since emerged as a market
leader in the region. In recognition of his pioneering efforts
he was selected as the “Business Man of the Year” in
1992, by Business India, a leading business magazine and
has been conferred the “Lifetime Achievement Award” by
Economic Times in 2006.
Mr. Vaghul is also on the Board of several companies. He
is on the Board of Mahindra World City Developers Limited,
Arcelor Mittal, Luxembourg, Wipro Limited, Piramal Health
Care Limited, National Aviation Company of India Limited,
IAL Airport Services Limited, Air India Air Transport Services
Limited, Air India Engineering Services Limited, Apollo
Hospitals Enterprise Limited, Arcelor Mittal Europe and
Hemogenomics Private Limited.
Mr. Vaghul was a visiting professor in the Stern Business
School of New York University teaching a regular 3 credit
Mr. Vaghul is a Member of following Board Committees:
Sr. No. Name of the Company
1. Mahindra & Mahindra Limited
2. Mahindra World City Developers Limited
3. Wipro Limited
4. Nicholas Piramal India Limited
5. Apollo Hospitals Enterprise Limited
Mr. Narayanan Vaghul holds 46,664 Ordinary (Equity) Shares in the Company.
MAHINDRA & MAHINDRA LIMITED
course titled “Emerging Economies” to the MBA students
during the fall semester from 1998 to 2001. This course
has been quite popular with the students and has received
a very high rating in the student evaluation.
Mr. Vaghul is also connected intimately with education.
He is the Chairman of IFMR (a business school based in
Chennai). He is also the Chairman of a Public Trust known
as Pratham, a highly successful and well regarded NGO,
which has as its goal, universalization of primary education
throughout the country.
Mr. Vaghul has been closely associated with the policy
formulation at the national level. He was the Chairman of
several committees and task forces constituted by the
Government and the Reserve Bank of India. He also served
for a while as the Chairman of Foreign Investment Advisory
Board constituted by the Government. Mr. Vaghul has
handled several assignments for Asian Development Bank,
IFC and the World Bank.
Mr. Vaghul graduated from the Madras University in 1956,
and joined State Bank of India, the largest commercial
bank in India in 1957 as a career banker. He occupied
various positions in that Bank before joining the Board of
the Central Bank of India, the second largest commercial
bank in 1978. He became Chairman of Bank of India, an
equally large commercial bank in 1981 and had the
distinction of being appointed as the youngest ever
Chairman in a State-owned bank.
Name of Committee Position held
Remuneration/Compensation Committee Chairman
Remuneration Committee Member
Audit Committee Chairman
Board Governance and Compensation Committee Member
Compensation Committee Chairman
Audit Committee Member
Remuneration Committee Member
53
Mr. Arun Kanti Dasgupta
Mr. A.K. Dasgupta, a direct recruit of 10th Batch hails from
Assam. He is a Science Graduate from Dibrugarh University
and also PGDBM from Punjab University. Mr. Dasgupta
has served Life Insurance Corporation of India (LIC) in many
important assignments such as Senior Divisional Manager
of Guwahati and Karnal Divisions, Deputy General Manager,
LIC (International) Bahrain, Regional Manager (Marketing),
Western Zone, Mumbai, Chief Executive, LIC Housing
Finance, Mumbai, Zonal Manager, Central Zone, Bhopal
and Executive Director (SBU-International Operations/
Corporate Communications). Apart from being associated
with many organizational development programmes in LIC,
he was also instrumental in introducing many new initiatives
during his tenure as CEO with LIC Housing Finance Limited
and Executive Director (SBU-International Operation/
Corporate Communications). He is currently Managing
Director of Life Insurance Corporation of India.
Mr. Dasgupta is also a Director of Asean Brown Boveri
(ABB) Limited, LIC (Nepal) Limited, LIC (Mauritius) Offshore
Limited, Saudi Indian Company for Co-op. Insurance, LIC
Pension Fund Limited and Grasim Industries Limited.

Mr. Dasgupta is a Member of following Board Committees:

Sr. No. Name of the Company Name of Committee Position held

1. Asean Brown Boveri (ABB) Limited Audit Committee Member

2. LIC (Nepal) Limited Audit Committee Chairman

3. Saudi Indian Company for Co-op. Executive Committee Chairman
Insurance
4. LIC Pension Fund Limited Audit Committee Member

Mr. Arun Kanti Dasgupta does not hold any Shares in the
Company.
E. Codes of Conduct
The Board has laid down two separate Codes of Conduct
(“Codes”), one for Board Members and other for Senior
Management and Employees of the Company. These Codes
have been posted on the Company’s website http://
www.mahindra.com. All Board Members and Senior
Management Personnel have affirmed compliance with
these Codes. A declaration signed by the Vice-Chairman &
Managing Director to this effect is enclosed at the end of
this Report.
F. CEO/CFO Certification
As required under Clause 49 V of the Listing Agreement
with the Stock Exchanges, the Vice-Chairman & Managing
Director and the Group Chief Financial Officer of the
Company have certified to the Board regarding the Financial
Statements for the year ended 31st March, 2009.
II. Remuneration to Directors
A. Remuneration Policy
While deciding on the remuneration for Directors, the
Board, Remuneration/ Compensation Committee
(“Committee”) considers the performance of the Company,
the current trends in the industry, the qualification of the
appointee(s), their experience, past performance and other
relevant factors. The Board/Committee regularly keeps track
of the market trends in terms of compensation levels and
practices in relevant industries through participation in
structured surveys. This information is used to review the
Company’s remuneration policies.

54
 MAHINDRA & MAHINDRA LIMITED

B. Remuneration to Non-Executive Directors for the Non-Executive Directors in the accounts of the year under
year ended 31st March, 2009 review.

The eligible Non-Executive Directors are paid commission During the year under review, the Non-Executive Directors
upto a maximum of 1% of the net profits of the Company were paid a commission of Rs.96 lakhs (provided in the
as specifically computed for this purpose. A commission of accounts for the year ended 31st March, 2008), distributed
Rs. 96 lakhs has been provided as payable to the eligible amongst the Directors as under:
(Rs. in Lakhs)
Directors Commission for the year ended
31st March, 2008, paid during
the year under review
Mr. Keshub Mahindra 32.00
Mr. Deepak S. Parekh 8.00
Mr. N. B. Godrej 8.00
Mr. M. M. Murugappan 8.00
Mr. Narayanan Vaghul 8.00
Dr. A. S. Ganguly 8.00
Mr. R. K. Kulkarni 8.00
Mr. Anupam Puri 8.00
Mr. Thomas Mathew T.* (Nominee of LIC) 8.00#

# The Commission is paid to the Nominating Financial Institution.

* resigned with effect from 30th July, 2008.
Non-Executive Directors are also paid a sitting fee of Rs.10,000 for every Meeting of the Board or Committee attended.
The sitting fees paid to Non-Executive Directors for the year ended 31st March, 2009 along with their shareholdings are as under:
Directors Sitting Fees for the Board No. of Ordinary (Equity)
and Committee Meetings Shares held as on
paid during the year 31st March, 2009
ended 31st March, 2009
(Rs. in Lakhs)
Mr. Keshub Mahindra 1.10 2,01,148
Mr. Deepak S. Parekh 1.10 52,754
Mr. N. B. Godrej 1.10 1,81,421
Mr. M. M. Murugappan 1.00 46,664
Mr. Narayanan Vaghul 0.70 46,664
Dr. A. S. Ganguly 0.90 46,664
Mr. R. K. Kulkarni 1.70 45,452
Mr. Anupam Puri 0.50 43,332
Mr. Thomas Mathew T.** (Nominee of LIC) 0.10* Nil
Mr. Arun Kanti Dasgupta *** (Nominee of LIC) 0.40* Nil
* Sitting Fees for Board Meetings were paid to LIC.
** resigned with effect from 30th July, 2008.
***appointed with effect from 30th July, 2008.
55
35,000 Stock Options granted in June, 2005 to the Non-
Executive Directors which have vested in June, 2006 can
be exercised in three tranches over a period of five years
from the date of vesting at an Original Exercise Price of
Rs.454 per share. The Options granted stand augmented
by an equal number of Options and the Exercise Price
stands reduced to half on account of the 1:1 Bonus Issue
made in September, 2005. Details of the Options granted
to each of the Directors are given in the Statement attached
to Annexure I to the Directors’ Report.
C. Remuneration paid/payable to Managing/Executive
Director(s) (Whole-time Directors) for the year ended
31st March, 2009:
Remuneration to Whole-time Directors is fixed by the
Remuneration / Compensation Committee which is
subsequently approved by the Board of Directors and
Shareholders at a General Meeting.
Following is the remuneration paid/payable to the Whole-
time Directors during the year ended 31st March, 2009:

(Rs. In Lakhs)
Directors Salary Comm- Company’s Perquisites Total Contract No. of No. of No. of No. of
ission Contribu- and Period Options Options Options Options
tion to allowances granted granted in granted granted
Funds* in June, September, in July, in August,
2005$ 2006 $$ 2007$$$ 2008$$$$
Mr. Anand G. 63.00 96.47 17.01 36.26 212.74 4th April, Nil Nil Nil Nil
Mahindra 2007 to
(Vice-Chairman 3rd April
& Managing 2012
Director
Mr. Bharat Doshi 57.00 61.79 15.39 16.29 150.47 28th August, 10,000 11,345 8,362 29,039
(Executive Director) 2007 to
27th August,
2012
Mr. A. K. Nanda 57.00 61.79 15.39 18.28 152.46 28th August, 10,000 11,345 8,362 24,890
(Executive Director) 2007 to
27th August,
2012
* Aggregate of the Company’s contributions to Superannuation Fund, Provident Fund, Gratuity and Privilege Leave Encashment.
Options granted on Vesting period Exercise period Exercise price
$ June, 2005 Already vested in June, 2006 Within five years from Rs.454 per share#
the date of vesting
$$ September, 2006 Four equal instalments On the date of Vesting or Rs.616 per share
in September 2007, 2008, 2009 and 2010 within five years from
respectively the date of Vesting
$$$ July, 2007 Four equal instalments On the date of Vesting or Rs.762 per share
in July, 2008, 2009, 2010 and 2011 within five years from
respectively the date of Vesting
$$$$ August, 2008 Four equal instalments On the date of Vesting or Rs.500 per share
in August, 2009, 2010, 2011 and 2012 within five years from
respectively the date of Vesting
# The Options granted stand augmented by an equal number of Options and the Exercise Price stands reduced to half on account of the 1:1 Bonus Issue made in
September, 2005.
Details of the Options granted including discount are given in the Statement attached to Annexure I to the Directors’ Report.
Notes:
a) Notice period applicable to each of the Whole-time Directors – six months.
b) Employee Stock Option and Commission are the only components of remuneration that are performance-linked. All
other components are fixed.

56

III. Risk Management
Your Company has a well-defined risk management
framework in place. The risk management framework
adopted by the Company is discussed in detail in the
Management Discussion and Analysis Chapter of this
Annual Report. Your Company has established procedures
to periodically place before the Board, the risk assessment
and minimisation procedures being followed by the
Company and steps taken by it to mitigate these risks.
IV. Committees of the Board
A. Audit Committee
This Committee comprises solely of Independent Directors
viz. Mr. Deepak S. Parekh (Chairman of the Committee),
Mr. R. K. Kulkarni, Mr. N. B. Godrej and Mr. M. M.
Murugappan. All the Members of the Committee possess
strong accounting and financial management knowledge.
The Company Secretary is the Secretary to the Committee.
The terms of reference of this Committee are very wide.
Besides having access to all the required information from
within the Company, the Committee can obtain external
professional advice whenever required. The Committee acts
as a link between the Statutory and the Internal Auditors
and the Board of Directors of the Company. It is authorised
to select and establish accounting policies, review reports
of the Statutory and the Internal Auditors and meet with
them to discuss their findings, suggestions and other related
matters. The Committee is empowered to inter alia review
the remuneration payable to the Statutory Auditors and to
recommend a change in Auditors, if felt necessary. It is
also empowered to review Financial Statements and
investments of unlisted subsidiary companies, Management
Discussion & Analysis, material individual transactions with
related parties not in normal course of business or which
are not on an arm’s length basis. Generally all items listed
in Clause 49 II (D) of the Listing Agreement are covered in
MAHINDRA & MAHINDRA LIMITED
the terms of reference. The Audit Committee has been
granted powers as prescribed under Clause 49 II (C).
The Meetings of the Audit Committee are also attended
by the Vice-Chairman & Managing Director, the Executive
Directors of the Company, the President-Finance, Legal and
Financial Services Sector, the Statutory Auditors, Chief
Internal Auditor and the Company Secretary. The Chairman
of the Audit Committee, Mr. Deepak S. Parekh was present
at the 62nd Annual General Meeting of the Company held
on 30th July, 2008.
The Committee met five times during the year under review
and the gap between two Meetings did not exceed four
months. The attendance at the Meetings is as under:
Members Number of
Meetings attended
Mr. Deepak S. Parekh (Chairman) 4
Mr. R. K. Kulkarni 5
Mr. N. B. Godrej 4
Mr. M. M. Murugappan 4
B. Remuneration/Compensation Committee
The role of the Remuneration/Compensation Committee is
to review market practices and to decide on remuneration
packages applicable to the Vice-Chairman & Managing
Director, the Executive Directors and Senior Executives of
the Company. During the course of its review, the
Committee also decides on the commission of the Directors
and/or other incentives payable, taking into account the
individual’s performance as well as that of the Company.
The Committee has formulated and administers the
Mahindra & Mahindra Limited Employees’ Stock Option
Scheme and also attends to such other matters as may be
prescribed from time to time.
Mr. Narayanan Vaghul is the Chairman of the Committee.
Mr. Keshub Mahindra, Mr. N. B. Godrej and Mr. M. M.
Murugappan are the other Members of the Committee.
57
The Committee met once during the year under review
and all Members of the Committee attended the same.
C. Share Transfer and Shareholders/Investors
Grievance Committee
The Company’s Share Transfer and Shareholders/Investors
Grievance Committee functions under the Chairmanship
of Mr. Keshub Mahindra, Chairman of the Board and a
Non-Executive Director. Mr. Anand G. Mahindra, Mr. R. K.
Kulkarni, Mr. Bharat Doshi and Mr. A. K. Nanda are also
on the Committee. Mr. Narayan Shankar, Company
Secretary is the Compliance Officer of the Company.
The Committee meets as and when required, to inter alia
deal with matters relating to transfer of shares and monitor
redressal of complaints from Shareholders relating to
transfers, non-receipt of balance sheet, non-receipt of
dividends declared, etc. With a view to expediting the process
of share transfers, Mr. A. K. Nanda, Executive Director as
well as Mr. Narayan Shankar, Company Secretary of the
Company are severally authorised to approve transfers of
not more than 5,000 Ordinary (Equity) Shares per transfer,
provided the transferee does not hold one lakh or more
Ordinary (Equity) Shares in the Company.
The Committee met two times during the year. Both the
Meetings were well attended by its Members. During the
year, 20 complaints were received from the Shareholders,
all of which have been attended to/resolved to date. As of
date, there are no pending share transfers pertaining to
the year under review.
D. Research & Development Committee (a voluntary
initiative of the Company)
The Research & Development (R&D) Committee, which was
constituted by the Board in 1998, provides direction on
the R&D mission and strategy and key R&D and technology
issues. The Committee also reviews and makes
recommendations on skills and competencies required and
the structure and the process needed to ensure that the
58
R&D initiatives result in products that are in keeping with
the business needs. Dr. A. S. Ganguly is the Chairman of
the Committee. Mr. Anand G. Mahindra, Mr. N. B. Godrej,
Mr. Bharat Doshi and Mr. M. M. Murugappan are the
other Members of the Committee.
The Committee held two Meetings during the year under
review, which were well attended.
E. Loans & Investment Committee (a voluntary
initiative of the Company)
The Committee approves of the making of loans and
investment, disinvestment, borrowing moneys and related
aspects of fund management in accordance with the
Guidelines prescribed by the Board. Mr. Keshub Mahindra
is the Chairman of the Committee. Mr. Anand G. Mahindra,
Mr. R. K. Kulkarni, Mr. Bharat Doshi and Mr. A. K. Nanda
are the other Members of the Committee.
V. Subsidiary Companies
Clause 49 defines a “material non-listed Indian subsidiary”
as an unlisted subsidiary, incorporated in India, whose
turnover or net worth (i.e. paid-up capital and free reserves)
exceeds 20% of the consolidated turnover or net worth
respectively, of the listed holding company and its
subsidiaries in the immediately preceding accounting year.
Under this definition, the Company did not have any
“material non-listed Indian subsidiary” during the year under
review. The Subsidiaries of the Company function
independently, with an adequately empowered Board of
Directors and sufficient resources. However, for more
effective governance, the Minutes of Board Meetings of
Subsidiaries of the Company are placed before the Board
of Directors of the Company for their review.
VI. Disclosures
A. Disclosure of transactions with Related Parties
During the financial year 2008-09, there were no materially
significant transactions entered into between the Company
 MAHINDRA & MAHINDRA LIMITED

and its promoters, Directors or the management, subsidiaries 4. Financial Year of the Company
or relatives, etc. that may have potential conflict with the
The financial year covers the period from 1st April to
interests of the Company at large. Further details of related
31st March.
party transactions are presented in Note Number “30” in
Schedule XIV to Annual Accounts of the Annual Report. Financial Reporting for:

B. Disclosure of Accounting Treatment in preparation Quarter ending

of Financial Statements 30th June, 2009 - End July, 2009
The Company has followed the Accounting Standards laid
Half-year ending
down by The Companies (Accounting Standards) Rules,
30th September, 2009 - End October, 2009
2006 in preparation of its financial statements.
Quarter ending
C. Code for Prevention of Insider Trading Practices
31st December, 2009 - End January, 2010
The Company has instituted a comprehensive Code of
Conduct for Prevention of Insider Trading for its designated Year ending
employees, in compliance with Securities and Exchange 31st March, 2010 - End May, 2010
Board of India (Prohibition of Insider Trading) Regulations,
Note: The above dates are indicative.
1992, as amended from time to time. The Code lays down
Guidelines, which advises them on procedures to be 5. Registered Office
followed and disclosures to be made, while dealing with
Mahindra & Mahindra Limited
shares of the Company, and cautioning them of the
Gateway Building,
consequences of violations.
Apollo Bunder,
VII. Shareholder Information Mumbai - 400 001.
1. 63rd Annual General Meeting
6. Listing of Ordinary (Equity) Shares and Debentures
Date : 30th July, 2009 on Stock Exchanges
Time : 3:30 p.m.
The Company’s Shares are listed on Bombay Stock
Venue : Y B Chavan Centre
Exchange Limited (BSE) and National Stock Exchange of
General Jagannathrao Bhosale Marg,
India Limited (NSE). The Global Depositary Receipts (GDRs)
Next to Sachivalaya Gymkhana,
of the Company are listed on the Luxembourg Stock
Mumbai - 400 021.
Exchange and are also admitted for trading on
2. Dates of Book Closure/Record Date International Order Book (IOB) of the London Stock
Dates of Book Closure for Dividend will be from 11th
Exchange. The US $ 200 million Zero Coupon Foreign
July, 2009 to 30th July, 2009, both days inclusive. Currency Convertible Bonds (FCCBs) due for redemption
3. Date of Dividend Payment in 2011 are listed at Singapore Exchange Securities Trading
Date of payment of Dividend would be on or after Limited. The requisite listing fees have been paid in full
st
31 July, 2009. to all these Stock Exchanges.

59
7. Stock Code
1. Bombay Stock Exchange Limited (BSE) : 500520
2. National Stock Exchange of India Limited (NSE): M&M
3. Demat International Security Identification Number (ISIN) in NSDL and CDSL for Equity Shares -INE101A01018
4. Corporate Identity Number: L65990MH1945PLC004558
5. FCCBs, Singapore Exchange Securities Trading Limited (ISIN): XSO250972543
6. GDRs, Luxembourg Stock Exchange (ISIN): USY541641194
8. Stock Performance
The performance of the Company’s Shares relative to the BSE Sensitive Index is given in the chart below:

M&M on BSE BSE Sensex

800 20000

700 18000
16000
600
M&M on BSE

BSE SENSEX
14000
500 12000
400 10000

300 8000
6000
200
4000
100 2000
0 0
Apr-08 May-08 Jun-08 Jul-08 Aug-08 Sep-08 Oct-08 Nov-08 Dec-08 Jan-09 Feb-09 Mar-09
Closing Price on Last Trading day of the Month

The performance of the Company’s Shares relative to the NSE Sensitive Index (S&P CNX Nifty Index) is given in the chart below:

M&M on NSE NSE Nifty

800 6000

700
5000
600
M&M on NSE

4000
NSE NIFTY

500

400 3000

300
2000
200
1000
100

0 0
Apr-08 May-08 Jun-08 Jul-08 Aug-08 Sep-08 Oct-08 Nov-08 Dec-08 Jan-09 Feb-09 Mar-09
Closing Price on Last Trading day of the Month

60
 MAHINDRA & MAHINDRA LIMITED

9. Stock Price Data:

Equity Shares GDRs

Bombay Stock National Stock Luxembourg Stock
Exchange Limited Exchange of India Limited Exchange*
High Low High Low High Low
Rs. Rs. Rs. Rs. US $ US $
April, 2008 715.00 594.00 716.75 592.10 16.47 14.99
May, 2008 705.00 585.00 705.00 583.05 17.04 14.41
June, 2008 669.00 477.00 607.00 478.00 14.09 11.40
July, 2008 573.00 430.00 574.40 427.10 13.24 10.30
August, 2008 609.00 511.00 603.00 506.00 13.88 12.15
September, 2008 604.00 450.00 618.70 490.00 13.36 11.00
October, 2008 536.00 236.00 539.00 237.10 11.03 4.81
November, 2008 410.00 258.00 412.00 256.00 8.19 5.31
December, 2008 346.90 235.50 347.00 235.00 7.16 4.87
January, 2009 330.00 258.80 330.00 258.60 6.66 5.30
February, 2009 333.00 264.80 333.55 264.00 6.51 5.46
March, 2009 394.50 297.30 397.70 290.05 7.61 6.00

* Based on closing prices.

10. Registrar and Transfer Agent:
Sharepro Services (India) Private Limited
Unit: Mahindra & Mahindra Limited
13AB, Samhita Warehousing Complex,
2nd Floor, Sakinaka Telephone Exchange Lane,
Off Andheri Kurla Road,
Sakinaka, Andheri (East),
Mumbai - 400 072.
Telephone No.: +91-22-67720400
Fax: +91-22-28591568
Email: sharepro@shareproservices.com
The Registrar and Transfer Agents also have an office at:
Sharepro Services (India) Private Limited
912, Raheja Centre,
Free Press Journal Road,
Nariman Point,
Mumbai - 400 021.
Telephone No.: +91-22-22881568/69
Fax: +91-22-22825484

61
11. Share Transfer System
Trading in Ordinary (Equity) Shares of the Company through
recognized Stock Exchanges is permitted only in
dematerialised form.
Shares sent for transfer in physical form are registered and
Director as well as Mr. Narayan Shankar, Company Secretary
of the Company are severally authorised to approve the
transfers of not more than 5,000 Ordinary (Equity) Shares
per transfer, provided the transferee does not hold one
lakh or more Ordinary (Equity) Shares in the Company. The

returned within a period of thirty days from the date of Share Transfer and Shareholders/Investors Grievance
receipt of the documents, provided the documents are Committee meets as and when required to consider the

valid and complete in all respects. With a view to expediting other transfer proposals and attend to Shareholder
the process of share transfers, Mr. A. K. Nanda, Executive grievances.

12. Distribution of Shareholding as on 31st March, 2009:

Number of Shares held Number of Number of Percentage of
Shareholders Shares held Shareholding
1 to 500 1,45,042 91,81,713 3.29
501 to 1000 4,950 36,19,031 1.30
1001 to 5000 4,120 83,44,815 2.99
5001 to 10000 425 29,22,549 1.05
10001 and above 569 25,47,53,157 91.37
Total 1,55,106 27,88,21,265 100.00

Shareholding Pattern as on 31st March, 2009:

Sr. No. Category of Shareholders Total Holdings Holdings in

Percentage
1. Promoters and Promoter Group 8,14,14,412 29.20
2. Mutual Funds/UTI 66,80,617 2.40
3. Banks, Financial Institutions, Insurance Companies 6,44,22,073 23.10
& State Government
4. FIIs/Foreign Bodies* 6,72,84,732 24.13
5. Private Corporate Bodies 1,19,72,505 4.29
6. Indian Public 2,66,16,303 9.55
7. NRIs/OCBs/ Foreign National 19,00,907 0.68
8. Bank of New York (for GDR holders) 1,85,29,716 6.65
Grand Total 27,88,21,265 100.00

* FIIs/Foreign Bodies does not include Shareholding aggregating 117.50 lakhs Shares representing 4.21% of the
paid-up share capital of the Company held by a FII as the same is included under the category of Promoters and
Promoter Group.

62

13. Dematerialisation of Shares
98.26% of the paid-up Equity Share Capital is held in
dematerialised form with National Securities Depository
Limited and Central Depository Services (India) Limited as
on 31st March, 2009. The market lot of the share is one
share, as the trading in the Equity Shares of the Company
is permitted only in dematerialised form. Non-Promoters’
holding is 70.8% and the stock is highly liquid.
14. Outstanding GDRs / ADRs / Warrants or any Convertible
Instruments, Conversion date and likely impact on equity
1,85,29,716 GDRs were outstanding as at 31st March,
2009. Since the underlying Ordinary (Equity) Shares
represented by GDRs have been allotted in full, the
outstanding GDRs have no impact on the Equity of the
Company.
2000 Zero Coupon Convertible Bonds (due 2011) of US$
1,00,000 each (FCCBs) aggregating US$ 200 million issued
in April, 2006, may at the option of the Bondholder, be
converted into around 96,35,156 Equity Shares/GDRs, each
GDR representing One Equity Share of the Company at an
initial conversion price of Rs.922.04 at any time between
7th May, 2006 and 7th March, 2011.
During the year, the Company has repurchased 105 FCCBs
aggregating US$ 1,05,00,000 at a discount and the same
have been cancelled upon repurchase. Till date, no
conversion of any FCCBs have taken place. As of date,
FCCBs amounting US$ 18,95,00,000 convertible into
around 91,29,311 Equity Shares/GDRs are outstanding.
In July, 2008, the Company has allotted 93,95,974
Unsecured Fully & Compulsorily Convertible Debentures
(FCDs) on preferential allotment basis. The FCDs would be
compulsorily convertible into equivalent number of fully
paid-up Equity Shares of the face value of Rs.10 each. The
holder of the FCDs will have an option to convert each
FCD into one fully paid-up Equity Share of the Company at
MAHINDRA & MAHINDRA LIMITED
any time after the date of allotment but on or before the
expiry of 18 months from the date of allotment of FCDs.
In the event this option is not exercised by the holder
within 18 months, the FCDs shall be compulsorily
convertible on the date falling 18 months from the date
of allotment of the FCDs. The Equity Shares to be so allotted
on conversion of the FCDs would be at a conversion price
of Rs.745 per Share (including a premium of Rs.735 per
Share).
15. Plant Locations
The Company’s manufacturing facilities are located at
Kandivali, Nashik, Igatpuri, Nagpur, Zaheerabad, Jaipur,
Rudrapur, Haridwar, Pune and Mohali.
16. Address for correspondence
Shareholders may correspond with the Registrar and
Transfer Agents at:
Sharepro Services (India) Private Limited
Unit: Mahindra & Mahindra Limited
13AB, Samhita Warehousing Complex,
2nd Floor, Sakinaka Telephone Exchange Lane,
Off Andheri Kurla Road,
Sakinaka, Andheri (East),
Mumbai - 400 072.
Telephone No.: +91-22-67720400
Fax: +91-22-28591568
Email: sharepro@shareproservices.com
on all matters relating to transfer/dematerialisation of
shares, payment of dividend and any other query relating
to Equity Shares or Debentures of the Company.
The Company has also designated investors@mahindra.com
as an exclusive email ID for Shareholders for the purpose
of registering complaints and the same has been displayed
on the Company’s website.
63
Shareholders would have to correspond with the respective Depositary Participants for Shares held in demateralised form.

For all investor related matters, the Company Secretary & Compliance Officer can be contacted at:

Mahindra Towers,
5th Floor, Dr. G. M. Bhosale Marg,
Worli, Mumbai - 400 018.
Telephone Nos.: +91-22-24905624, +91-22-24975074
Fax: +91-22-24900833
email: investors@mahindra.com
The Company can also be visited at its website:
http://www.mahindra.com

VIII. Other Disclosures

1. Details of General Meetings and Special Resolutions passed
Annual General Meetings (AGM) held during the past 3 years and the Special Resolutions passed therein:

Year Date Time Special Resolutions passed

th
2006 26 July, 2006 3.30 p.m. No Special Resolution was passed at the AGM.
th
2007 30 July, 2007 3.30 p.m. 1. Re-appointment of Mr. Anand G. Mahindra, Vice-Chairman & Managing
Director for a period of 5 years w.e.f. 4th April, 2007.
2. Re-appointment of two Executive Directors of the Company viz. Mr.
Bharat Doshi and Mr. A.K. Nanda for a period of 5 years w.e.f. 28th
August, 2007.
3. Alteration of Article 3 of the Articles of Association of the Company.
4. Authority to the Board to recover from Eligible Employees, the fringe
benefit tax in respect of Options which are granted to or vested or
exercised by the Eligible Employees on or after 1st April, 2007.
2008 30th July, 2008 3.30 p.m. No Special Resolution was passed at the AGM.

Extraordinary General Meetings held during the past 3 years:

Year Date Time Special Resolutions passed

th
2007 20 April, 2007 11.00 a.m. Making investments, etc. in excess of the limits prescribed under section
372A of the Companies Act, 1956 upto an amount of Rs.1,500 crores.

All the Meetings were held at Birla Matushri Sabhagar, 19, Sir Vithaldas Thackersey Marg (New Marine Lines),
Mumbai - 400 020.

64
 MAHINDRA & MAHINDRA LIMITED

Details of the Court Convened Meetings held during the year 2008-09:
Date Time Resolutions passed
th
12 April, 2008 3.30 p.m. Approving the arrangement embodied in the Scheme of Amalgamation of
Mahindra Holdings & Finance Limited with Mahindra & Mahindra Limited and
their respective Shareholders.
th
29 October, 2008 3.00 p.m. Approving the arrangement embodied in the Scheme of Amalgamation of
Punjab Tractors Limited with Mahindra & Mahindra Limited and their respective
Shareholders.
Both the Meetings were held at Y B Chavan Centre, General Jagannathrao Bhosale Marg, Next to Sachivalaya Gymkhana,
Mumbai - 400 021.
Details of Resolutions passed through Postal Ballots during the year 2008-09:

Date of Board Description % of Valid Votes in Scrutinizer for

Meeting favour of the conducting the
Resolution Postal Ballot

3rd May, 2008 Special Resolution authorising the Board to 99.98% Dr. S. D. Israni,
create, offer, issue and allot 93,95,974, 9.25% Practising Company
Unsecured Fully & Compulsorily Convertible Secretary, Mumbai
Debentures to Golboot Holdings Limited on
terms as specified in the Postal Ballot Notice
dated 3rd May, 2008.

13th February, 2009 1. Ordinary Resolution authorising the Board 99.91%*

to transfer, sell or otherwise dispose of the
Land Systems Business forming part of
Company’s Mahindra Defence Systems
Division to a Subsidiary Company at such
consideration being not lower than the Net Dr. S. D. Israni,
Asset Value of the aforesaid Land Systems Practising Company
Business. Secretary, Mumbai

2. Ordinary Resolution authorising the Board 99.91%*

to transfer, sell or otherwise dispose of the
Naval Systems Business forming part of
Company’s Mahindra Defence Systems
Division to a Subsidiary Company at such
consideration being not lower than the Net
Asset Value of the aforesaid Naval Systems
Business.
* Results declared in April, 2009. 65
 The procedure for Postal Ballot is as per section 192A
of the Companies Act, 1956 and Rules made
thereunder namely Companies (Passing of the
Resolution by Postal Ballot) Rules, 2001.
2. Details of non-compliance etc.
The Company has complied with all the requirements
of regulatory authorities. During the last three years,
there were no instances of non-compliance by the
Company and no penalty or strictures were imposed
on the Company by the Stock Exchanges or SEBI or
any statutory authority, on any matter related to the
capital markets.
3. Means of Communication
The quarterly, half-yearly and yearly results are published
in Business Standard and Sakal which are national and
local dailies respectively. These are not sent individually
to the Shareholders. The Company’s results and official
news releases are displayed on the Company’s website
http://www.mahindra.com
Presentations are also made to international and
national institutional investors and analysts which are
also put up on the website of the Company.
The Company was regularly posting information
relating to its financial results and shareholding pattern
on the SEBI EDIFAR website at www.sebiedifar.nic.in.
Thereafter, it is being filed on Corporate Filing and
Dissemination System (CDFS) viz. www.corpfiling.co.in,
the common platform launched by BSE and NSE for
electronic filing by listed companies.
66
4. Management Discussion and Analysis Report
Management Discussion and Analysis Report (MDA)
has been attached to the Directors’ Report and forms
part of this Annual Report.
5. Compliance with Mandatory requirements
The Company has complied with all the mandatory
requirements of Clause 49 of the Listing Agreement
relating to Corporate Governance.
6. Compliance with Non-mandatory requirements
a. Office of the Chairman
The Company has provided the Chairman (Non-
Executive) with a full-fledged office, the expenses
of which are borne by the Company.
The Chairman is reimbursed all expenses incurred
in the performance of his duties.
b. Remuneration Committee
The Company has set up the Remuneration/
Compensation Committee long before application
of Clause 49 of Listing Agreement.
c. Audit Qualifications
During the year under review, there is no audit
qualification in the Company’s financial statements.
The Company continues to adopt best practices to
ensure regime of unqualified financial statements.
The Company has not adopted the other non-mandatory
requirements as specified in Annexure I D of Clause 49.
Mumbai, 28th May, 2009.
 MAHINDRA & MAHINDRA LIMITED

DECLARATION BY THE MANAGING DIRECTOR UNDER CLAUSE 49

OF THE LISTING AGREEMENT
To

The Members of Mahindra & Mahindra Limited

I, Anand G. Mahindra, Vice-Chairman & Managing Director of Mahindra & Mahindra Limited declare that all the
Members of the Board of Directors and Senior Management Personnel have affirmed compliance with the Code of
Conduct for the year ended 31st March, 2009.

Anand G. Mahindra
th
Mumbai, 28 May, 2009 Vice-Chairman & Managing Director

CERTIFICATE
To
The Members of Mahindra & Mahindra Limited

We have examined the compliance of conditions of Corporate Governance by Mahindra & Mahindra Limited, for the year
ended on 31st March, 2009, as stipulated in Clause 49 of the Listing Agreement of the said Company with stock
exchanges in India.

The compliance of conditions of Corporate Governance is the responsibility of the management. Our examination was
limited to procedures and implementation thereof, adopted by the Company for ensuring the compliance of the
conditions of the Corporate Governance. It is neither an audit nor an expression of opinion on the financial statements of
the Company.

In our opinion and to the best of our information and according to the explanations given to us, we certify that the
Company has complied with the conditions of the Corporate Governance as stipulated in the above mentioned Listing
Agreement.
We state that such compliance is neither an assurance as to the future viability of the Company nor the efficiency or
effectiveness with which the management has conducted the affairs of the Company.

For DELOITTE HASKINS & SELLS

Chartered Accountants

B.P. Shroff
(Partner)
th
Mumbai, 28 May, 2009 Membership Number: 34382

67
68
69
Financial Position at a Glance
(Rupees in crores)

2009 2008 2007 2006 2005 2004 2003 2002 2001 2000

Gross Fixed Assets 5541 4203 3510 3065 2810 2559 2489 2417 2231 1859

Net Fixed Assets 3214 2361 1871 1555 1475 1391 1466 1537 1483 1232

Investments 5786 4215 2238 1669 1190 1111 862 800 710 823

Deferred Tax Assets (Net) 18 - - - - - - - - -

Foreign Currency Monetary Item

Translation Difference Account 18 - - - - - - - - -

Inventories 1061 1084 878 879 760 500 457 469 553 515

Debtors 1044 1005 701 638 512 400 517 648 632 462

Other Current Assets 2959 1555 2169 1232 1028 625 640 616 529 684

Misc. Expenditure not written off 13 14 18 18 24 10 40 - 224 155

Long-term 3685 2187 1558 837 941 652 1072 1192 791 845
Borrowings
Short-term 368 400 78 46 111 78 68 185 344 109

Current Liabilities and Provisions 4798 3240 2666 2052 1760 1329 1095 1051 927 900

Deferred Tax Liability (Net) - 57 20 147 190 203 177 138 - -

Equity Capital 273 239 238 233 112 116 116 116 111 110

Reserves 4989 4111 3315 2676 1875 1659 1454 1388 1958 1907

Net Worth 5262 4350 3553 2909 1987 1775 1570 1504 2069 2017

Book Value Per Share (Rupees) 192.12 180.87 147.98 *123.29 174.46 150.89 130.56 128.26 165.50 166.90

* Book value per share is shown after giving effect to a 1:1 bonus issue in September, 2005
Book value per share is calculated after reducing Miscellaneous Expenditure not written off and Revaluation Reserve from Net
worth.

70
 MAHINDRA & MAHINDRA LIMITED

Summary of Operations
(Rupees in crores)

2009 2008 2007 2006 2005 2004 2003 2002 2001 2000

Income @ 14983 13238 11558 9451 7804 6001 4597 3997 4353 4409

Direct 9274 7726 6828 5714 4603 3353 2500 2117 2359 2210
Materials
Indirect 91 89 79 68 60 43 39 32 49 46

Excise Duty (Net) 1587 1584 1335 1136 1055 955 785 677 755 773

Personnel 1025 868 666 553 465 421 385 375 401 397

Interest (Net) @ 45 24 (67) (18) (6) 52 87 83 62 75

Depreciation (Net) 292 239 209 200 184 165 165 139 140 123

Other Expenses 1643 1474 1192 909 743 603 496 476 443 426

Exceptional items (10) (173) (122) (210) (14) (29) (57) 17 15 13

Extra-ordinary items - - - - - - - - - (4)

Profit before tax for the year 1036 1407 1438 1099 714 438 197 81 129 350

Tax for the year - Current 58 279 366 285 215 63 12 3 8 87

Deferred Tax Liability/(Asset) 141 25 (15) (43) (14) 26 39 (25) - -

Adj. pertaining to Prev. Years/

Special Adjustment ë31 - 19 - - - - 6 - -

Balance profit 868 1103 1068 857 513 349 146 97 121 263

Dividends #+312 +321 +325 +278 +172 +118 + 72 56 +67 +67

Equity Dividend (%) #100.00 115.00 115.00 100.00 130.00 90.00 55.00 50.00 55.00 55.00

Earnings per Share (Rupees) 31.83 46.24 45.15 38.07 23.04 15.02 6.28 4.31 5.46 11.93

Vehicles produced ** (Units) 201993 196956 169557 148213 148025 117670 87088 66256 63146 76983

Vehicles sold ** (Units) 206688 195077 169679 147591 145024 117399 86890 65338 62927 76437

Tractors produced (Units) 119098 98917 103,847 87075 67115 50102 45183 54524 80261 73222

Tractors sold (Units) 120202 99042 102,531 85029 65390 49576 47028 58006 79237 70571

@ Interest income netted off in

interest expense 89 63 87 45 36 25 29 33 51 67

# Proposed Dividend.
+ Including Income-Tax on Proposed Dividend/Dividends.
** Including CKD packs.
ë Profit of Mahindra Holdings and Finance Limited for the period 1st February, 2008 to 31st March, 2008.

71
Financial Highlights

PAT and Net Income (Rupees Crores) Earnings Per Shares (Rs.)
1500 14000
13364 50
46.24
45.15
11672 12000
1250

1103 40
10221
38.07
10000
1000 1068
31.83
8327 868 Net Income

EPS (Rs.)
30
PAT

8000
857

750 6769

6000
23.04
513 20
500
4000

250 10
2000

0 0
FY 2005 FY 2006 FY 2007 FY 2008 FY 2009 0
FY 2005 FY 2006 FY 2007 FY 2008 FY 2009
Net Income Profit After Tax

Net Segmental Revenue F-2009 Debt Equity Ratio

0.8

Others
0.4% 0.7
Farm
Equipment
43.2% 0.60
0.6
0.56
0.53

0.5
0.46
Times

0.4

0.3
0.31

0.2

Automotive
56.4% 0.1

0.0
FY 2005 FY 2006 FY 2007 FY 2008 FY 2009

72
 MAHINDRA & MAHINDRA LIMITED

ACCOUNTS

73
Auditors’ Report to the members of Mahindra & Mahindra Limited
1. We have audited the attached balance sheet of Mahindra &
Mahindra Limited as at 31st March, 2009, the profit and
loss account and also the cash flow statement for the year
ended on that date annexed thereto. These financial
statements are the responsibility of the Company’s
management. Our responsibility is to express an opinion on
these financial statements based on our audit.
2. We conducted our audit in accordance with the auditing
standards generally accepted in India. Those Standards
require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes
examining on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also
includes assessing the accounting principles used and
significant estimates made by management, as well as
evaluating the overall financial statement presentation. We
believe that our audit provides a reasonable basis for our
opinion.
3. As required by the Companies (Auditor’s Report) Order,
2003 (hereinafter referred to as ‘the Order’) issued by the
Central Government of India in terms of sub-section (4A) of
Section 227 of the Companies Act, 1956, we enclose in the
Annexure, a statement on the matters specified in
paragraphs 4 and 5 of the said Order.
4. Further to our comments in the Annexure referred to in
paragraph 3 above, we report that:
i. we have obtained all the information and explanations
which to the best of our knowledge and belief were
necessary for the purposes of our audit;
ii. in our opinion, proper books of account as required by
law have been kept by the company so far as appears
from our examination of those books;
74
iii. the balance sheet and the profit and loss account dealt
with by this report are in agreement with the books of
account;
iv. in our opinion, the balance sheet and the profit and
loss account dealt with by this report comply with the
accounting standards referred to in sub-section (3C) of
Section 211 of the Companies Act, 1956;
v. in our opinion and to the best of our information and
according to the explanations given to us, the said
accounts give the information required by the
Companies Act, 1956, in the manner so required and
give a true and fair view in conformity with the
accounting principles generally accepted in India:
(a) in the case of the balance sheet, of the state of
affairs of the company as at 31st March, 2009;
(b) in the case of the profit and loss account, of the
profit for the year ended on that date; and
(c) in the case of the cash flow statement, of the cash
flows for the year ended on that date.
5. On the basis of the written representations received from
the directors, as on 31st March, 2009, and taken on record
by the Board of Directors, we report that none of the
directors is disqualified as on 31st March, 2009 from being
appointed as a director in terms of clause (g) of sub-section
(1) of section 274 of the Companies Act, 1956.
For DELOITTE HASKINS & SELLS
Chartered Accountants
B.P. Shroff
(Partner)
Membership Number: 34382
Mumbai, 28th May, 2009

Annexure to the Auditors’ Report
(Referred to in paragraph (3) of the Auditors’ Report of even date to the members of Mahindra & Mahindra Limited.)
(i) (a) The company is maintaining proper records showing
full particulars, including quantitative details and
situation of fixed assets.
(b) The fixed assets have not been physically verified by
the management during the year but the company has
a system of verifying the fixed assets once in every
three years. In our opinion the frequency of verification
is at reasonable intervals.
(c) During the year, in our opinion, a substantial part
of fixed assets has not been disposed off by the
company.
(ii) (a) The inventory of the company has been physically
verified by the management as at the year end. In
respect of stocks lying with third parties, a substantial
portion has been confirmed by third parties. In our
opinion the frequency of verification is reasonable.
(b) In our opinion and according to the information and
explanations given to us, the procedures of physical
verification of inventory followed by the management
were found reasonable and adequate in relation to the
size of company and the nature of its business.
(c) On the basis of our examination of records of inventory,
in our opinion, the company has maintained proper
records of inventory and the discrepancies noticed on
physical verification between the physical stocks and
the book records were not material in relation to the
operations of the company.
(iii) According to the information and explanations given to us,
the company has neither granted nor taken any loans,
secured or unsecured, to/from companies, firms, or other
parties covered in the register maintained under section
301 of the Companies Act, 1956 and accordingly paragraphs
4(iii) (b), (c), (d), (f) and (g) of the Companies (Auditors’
Report) Order, 2003, are not applicable.
(iv) In our opinion and according to the information and
explanations given to us, having regard to the explanation
that many of the items are of a special nature and their
prices cannot be compared with alternative quotations, there
are adequate internal control systems commensurate with
the size of the company and the nature of its business for
purchase of inventory, fixed assets and for the sale of goods
and services. Further, on the basis of our examination and
according to the information and explanations given to us
we have neither come across nor have we been informed
of any instance of major weakness in the aforesaid internal
control system.
(v) (a) In our opinion and according to the information and
explanations given to us the particulars of contracts or
arrangements referred to in section 301 of the
MAHINDRA & MAHINDRA LIMITED
Companies Act, 1956 have been entered in the register
required to be maintained under that section.
(b) In our opinion and according to the information and
explanations given to us, having regard to comment in
(iv) above, the transactions made in pursuance of such
contracts or arrangements and exceeding the value of
rupees five lakhs in respect of any party during the
year have been made at prices, which are reasonable
having regard to the prevailing market prices at the
relevant time.
(vi) In our opinion and according to the information and
explanations given to us, the company has complied with
the provisions of Section 58A, 58AA and any other relevant
provisions of the Companies Act, 1956 and the Companies
(Acceptance of Deposits) Rules, 1975, as applicable, with
regard to the deposits accepted from the public. According
to the information and explanations given to us, no order
under the aforesaid sections has been passed by the
Company Law Board or National Company Law Tribunal or
Reserve Bank of India or any Court or any other Tribunal, on
the company.
(vii) In our opinion, the company has an internal audit system
commensurate with its size and nature of its business.
(viii) We have broadly reviewed the books of account maintained
by the company relating to the manufacture of motor
vehicles and tractors pursuant to the rules made by the
Central Government for the maintenance of cost records
under section 209 (1) (d) of the Companies Act, 1956 and
we are of the opinion that prima facie the prescribed
accounts and records have been maintained and are being
made up. We have not, however, made a detailed
examination of the records with a view to determining
whether they are accurate or complete. To the best of our
knowledge and according to the information given to us,
the Central Government has not prescribed the maintenance
of cost records under section 209 (1) (d) of the Companies
Act, 1956, for any other products of the Company.
(ix) (a) According to the information and explanations given
to us and according to the books and records as
produced and examined by us, in our opinion, the
undisputed statutory dues including provident fund,
investor education and protection fund, income-tax,
sales-tax, service tax, value added tax, customs duty,
excise duty, cess and other material statutory dues as
applicable have been generally regularly deposited by
the company during the year with the appropriate
authorities. According to the information and
explanations given to us, there are no arrears of
outstanding statutory dues as mentioned above as at
31st March, 2009 for a period of more than six months
from the date they became payable.
75
 (b) As at 31st March, 2009 according to the records of the account of income-tax, sales-tax, wealth tax, service
company and the information and explanations given tax, customs duty, excise duty and cess matters that
to us, the following are the particulars of dues on have not been deposited on account of any dispute:

Nature of the Nature of Amount Period to which Forum where pending

statute the dues Rs. in crores the amount relates
various years
covering the period

Income-Tax Laws Income-Tax 0.81 1999 Appellate Authority – Tribunal Level

46.81 2004-2008 Appellate Authority – Commissioner

(Appeals)

Sales-Tax Laws Sales-Tax 15.57 1988-2009 Appellate Authority – Commissioner

(Appeals)

184.65 1987-2008 High Court

1.56 1986-2006 Appellate Authority – Tribunal Level

Service Tax Laws Service Tax 0.17 2002 Appellate Authority – Commissioner

Excise Duty Laws Excise Duty 377.88 1987-2009 Appellate Authority – Tribunal Level

110.51 2007-2009 Appellate Authority – Commissioner

Custom Duty Laws Custom Duty 4.55 1996-2001 Appellate Authority – Tribunal Level

(x) The company does not have accumulated losses as at 31st (xiv) In our opinion the company is not dealing in or trading in
March, 2009 and has not incurred cash losses during the shares, securities, debentures and other investments.
financial year ended on that date and in the immediately Accordingly, the provisions of paragraph 4(xiv) of the Order
preceding financial year. are not applicable to the company.

(xi) In our opinion and according to the information and
explanations given to us, the company has not defaulted
in repayment of dues to a financial institution, bank or to
debenture holders during the year.
(xii) In our opinion and according to the information
and explanations given to us, the company has not
granted any loans and advances on the basis of
security by way of pledge of shares, debentures and other
securities.
(xiii) The provisions of any special statute as specified under
paragraph 4(xiii) of the said Order are not applicable to the
company.
(xv) According to the information and explanations given to
us, the company has not given any guarantees for loans
taken by others from banks or financial institutions, the
terms and conditions, whereof, in our opinion, are
prejudicial to the interest of the company.
(xvi) In our opinion and according to the information and
explanations given to us, the term loans were applied for
the purpose for which the loans were obtained.
(xvii) Based on the information and explanations given to us
and on an overall examination of the balance sheet of the
company, in our opinion, funds raised on short term basis
have not been used for long term investments.

76
 MAHINDRA & MAHINDRA LIMITED

(xviii) The company has not made any preferential allotment of according to the information and explanations given to
shares to parties and companies covered in the register us, we have neither come across any instance of significant
maintained under section 301 of the Companies Act, 1956, fraud on or by the company, noticed or reported during
during the year. the year nor have we been informed of such case by the
management.
(xix) According to the information and explanations given to
us, the company has created security in respect of
debentures issued during the year.
For DELOITTE HASKINS & SELLS
(xx) The company has not raised any money by public issue Chartered Accountants
during the year. B.P. Shroff
(Partner)
(xxi) During the course of our examination of the books and
Membership Number: 34382
records of the company, carried out in accordance with
the generally accepted auditing practices in India, and Mumbai, 28th May, 2009

77
Balance Sheet as at 31st March, 2009
Rupees crores

Schedule 2009 2008

I. SOURCES OF FUNDS :
SHAREHOLDERS’ FUNDS :
Capital ................................................................................. I 272.62 239.07
Employee Stock Options Outstanding ................................. 6.55 4.00
Reserves and Surplus ........................................................... II 4,982.91 4,107.00
5,262.08 4,350.07
LOAN FUNDS :
(a) Secured Loans .............................................................. III A 981.00 617.26
(b) Unsecured Loans .......................................................... III B 3,071.76 1,969.80
4,052.76 2,587.06
DEFERRED TAX LIABILITY (Net) ............................................ — 56.72
Total .......... 9,314.84 6,993.85
II. APPLICATION OF FUNDS :
FIXED ASSETS :
Gross Block .......................................................................... 4,893.89 3,656.13
Less : Depreciation .............................................................. 2,326.29 1,841.68
Net Block ............................................................................. IV 2,567.60 1,814.45
CAPITAL WORK-IN-PROGRESS (INCLUDING CAPITAL
ADVANCES) ......................................................................... 646.73 546.45
3,214.33 2,360.90
INVESTMENTS ...................................................................... V 5,786.41 4,215.06
DEFERRED TAX ASSET (Net) ................................................ 18.27 —
FOREIGN CURRENCY MONETARY ITEM TRANSLATION
DIFFERENCE ACCOUNT [NOTE 3(d)] .................................... 18.11 —
CURRENT ASSETS, LOANS AND ADVANCES :
(a) Inventories .................................................................... VI A 1,060.67 1,084.11
(b) Sundry Debtors ............................................................ VI B 1,043.65 1,004.88
(c) Cash and Bank Balances ............................................... VI C 1,574.43 861.23
(d) Other Current Assets .................................................... VI D 1.56 2.27
(e) Loans and Advances ..................................................... VI E 1,382.62 691.88
5,062.93 3,644.37
CURRENT LIABILITIES AND PROVISIONS :
(a) Current Liabilities .......................................................... VII A 3,520.20 2,296.55
(b) Provisions ..................................................................... VII B 1,277.56 943.46
4,797.76 3,240.01
NET CURRENT ASSETS ......................................................... 265.17 404.36
MISCELLANEOUS EXPENDITURE (TO THE EXTENT NOT
WRITTEN OFF OR ADJUSTED) .............................................. VIII 12.55 13.53
Total .......... 9,314.84 6,993.85
NOTES ON ACCOUNTS ............................................................... XIV
Per our report attached

}
For Deloitte Haskins & Sells M. M. Murugappan Keshub Mahindra Chairman
Chartered Accountants N. Vaghul
R. K. Kulkarni Anand G. Mahindra Vice Chairman & Managing Director
A. S. Ganguly Directors
B. P. Shroff
Partner
A. P. Puri
N. B. Godrej
Bharat Doshi
A. K. Nanda } Executive Directors
A. K. Dasgupta
Narayan Shankar Company Secretary
th
Mumbai, 28 May, 2009 Mumbai, 28th May, 2009

78
 MAHINDRA & MAHINDRA LIMITED

Profit and Loss Account for the year ended 31st March, 2009
Rupees crores

Schedule 2009 2008

SALES - Traded and Manufactured Goods [Note 11(a)] .......................................... 14,268.41 12,371.03
Less : Excise Duty on Sales (Net) ............................................................................. 1,619.35 1,566.39
Net Sales ................................................................................................................. 12,649.06 10,804.64
Income from Operations ......................................................................................... IX A 444.62 736.63
Other Income .......................................................................................................... IX B 270.34 130.37
Net Income .............................................................................................................. 13,364.02 11,671.64
EXPENDITURE :
Raw Materials, Finished and Semi-finished Products ............................................... X 9,274.23 7,725.91
Excise Duty ............................................................................................................... (32.30) 18.18
Personnel ................................................................................................................. XI 1,024.61 868.14
Interest, Commitment and Finance Charges (Net) ................................................... XII 45.26 24.24
Depreciation/Amortisation [Note 5(c)(i) & (d)] ......................................................... 291.51 238.66
Other Expenses ........................................................................................................ XIII 1,777.34 1,608.96
12,380.65 10,484.09
Less : Cost of Manufactured Products Capitalised .................................................. 42.83 46.49
12,337.82 10,437.60
Profit before exceptional items and taxation ........................................................... 1,026.20 1,234.04
Add : Exceptional Items [Note 23] .......................................................................... 10.27 172.73
Profit before taxation .............................................................................................. 1,036.47 1,406.77
Less : Provision for Tax - Current Tax (including Fringe Benefit Tax) ....................... 58.51 278.75
- Deferred Tax (Net) [Note 24] .......................................... 141.18 24.65
Profit for the year .................................................................................................... 836.78 1,103.37
Add :
Profit of Mahindra Holdings and Finance Limited for the period
1st February, 2008 to 31st March, 2008 [Note 25(a)] .............................................. 30.73 —
Balance of Profit for the year .................................................................................. 867.51 1,103.37
Balance of Profit for earlier years ............................................................................ 2,775.48 2,125.08
Amount Transferred on Amalgamation of Mahindra Holdings and Finance
Limited [Note 25(a)] ................................................................................................ 159.94 —
Less : Transfer to Debenture Redemption Reserve (Net) .......................................... (29.62) (16.88)
2,905.80 2,108.20
Total of Profit and Loss Account balances shown above ........................................ 3,773.31 3,211.57
Less :
General Reserve ....................................................................................................... 100.00 115.00
Credit of Income-Tax on Proposed Dividend of Previous Year ................................. (4.07) —
Proposed Dividend ................................................................................................... 278.83 282.61
Income-Tax on Proposed Dividend ........................................................................... 33.23 38.48
Balance for 2008-2009 and earlier years carried to Balance Sheet ......................... 3,365.32 2,775.48
EARNINGS PER SHARE [Note 26] :
(Face value Rs.10/- per share) (Rupees)
Basic ........................................................................................................................ 31.83 46.24
Diluted ..................................................................................................................... 30.02 41.52
NOTES ON ACCOUNTS ............................................................................................ XIV
Per our report attached

}
For Deloitte Haskins & Sells M. M. Murugappan Keshub Mahindra Chairman
Chartered Accountants N. Vaghul
R. K. Kulkarni Anand G. Mahindra Vice Chairman & Managing Director
A. S. Ganguly Directors
B. P. Shroff
Partner
A. P. Puri
N. B. Godrej
Bharat Doshi
A. K. Nanda } Executive Directors
A. K. Dasgupta
Narayan Shankar Company Secretary
th
Mumbai, 28 May, 2009 Mumbai, 28th May, 2009

79
Cash Flow Statement for the year ended 31st March, 2009
Rupees crores

2009 2008
A. CASH FLOW FROM OPERATING ACTIVITIES :

Net Profit before exceptional items and taxation ................................... 1,026.20 1,234.04

Adjustments for :

Net Profit earned by Mahindra Holdings and

Finance Limited from 1st February, 2008 to 31st March, 2008 ....... 30.73 —

Taxes and other adjustments on above ........................................... 11.01 —

41.74 —
Adjustments for :

Depreciation/Amortisation ............................................................... 291.52 238.66

(Profit)/Loss on Exchange (Net) ....................................................... 6.30 (39.90)

Investment and Interest Income ...................................................... (266.90) (143.60)

Interest, Commitment and Finance charges .................................... 134.12 87.59

Amortisation of Expenses ................................................................ 11.32 10.28

(Profit)/Loss on sale of investments (Net) ........................................ (92.36) (28.94)

(Profit)/Loss on fixed assets sold/scrapped/written off (Net) ............ 1.19 2.82

Excess of cost over fair value of current investments (Net) ............. (1.57) (1.74)

Provision for diminution in the value of long term investments ..... — (5.40)
83.62 119.77
Operating Profit before Working Capital changes .................................. 1,151.56 1,353.81

Changes in :

Trade and other receivables ............................................................. (99.37) (450.40)

Inventories ....................................................................................... 176.01 (205.63)

Trade and other payables ................................................................ 515.13 408.87

591.77 (247.16)

Miscellaneous Expenditure (to the extent not written off or adjusted)

incurred during the year ........................................................................ (11.73) (3.12)
Cash generated from operations ............................................................ 1,731.60 1,103.53

Income Taxes paid (Net of refunds) ........................................................ (100.30) (277.70)

NET CASH FROM OPERATING ACTIVITIES ............................................... 1,631.30 825.83

80
 MAHINDRA & MAHINDRA LIMITED

Cash Flow Statement (Contd.)

Rupees crores

2009 2008
B. CASH FLOW FROM INVESTING ACTIVITIES :

Purchase of fixed assets ......................................................................... (929.74) (729.09)

Sale of fixed assets ................................................................................. 14.58 12.00

Purchase of investments ......................................................................... (17,118.59) (16,091.67)

Sale of investments ................................................................................ 16,195.73 14,487.81

Interest received ..................................................................................... 79.87 68.95

Dividends received .................................................................................. 137.13 65.61

Inter corporate deposits (Net) ................................................................ (319.98) 111.31

NET CASH USED IN INVESTING ACTIVITIES ............................................ (1,941.00) (2,075.08)

C. CASH FLOW FROM FINANCING ACTIVITIES :

Proceeds from borrowings ..................................................................... 2,117.39 2,303.55

Repayments of borrowings (including premium on prepayments) ......... (1,005.05) (1,294.08)

Dividend paid [including income tax on dividend Rs. 38.48 crores

(2008 : Rs. 16.69 crores)] ...................................................................... (320.26) (118.01)

Interest, Commitment and Finance charges paid ................................... (95.17) (80.12)

NET CASH FROM FINANCING ACTIVITIES ............................................... 696.91 811.34
NET INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS ............ 387.21 (437.91)

CASH AND CASH EQUIVALENTS [Note 1] :

Opening Balance .................................................................................... 923.88 1,361.79

Cash and Bank Balance acquired pursuant to the Schemes of

Amalgamation ........................................................................................ 253.76 —

Cash and Bank Balance transferred on transfer of Division ................... (3.02) —

Closing Balance ...................................................................................... 1,561.83 923.88

See Notes attached.
Per our report attached

}
For Deloitte Haskins & Sells M. M. Murugappan Keshub Mahindra Chairman
Chartered Accountants N. Vaghul
R. K. Kulkarni Anand G. Mahindra Vice Chairman & Managing Director
A. S. Ganguly Directors
B. P. Shroff
Partner
A. P. Puri
N. B. Godrej
Bharat Doshi
A. K. Nanda } Executive Directors
A. K. Dasgupta
Narayan Shankar Company Secretary
th
Mumbai, 28 May, 2009 Mumbai, 28th May, 2009

81
Notes to the Cash Flow Statement for the year ended 31st March, 2009
Rupees crores

2009 2008
1 Cash and Bank Balances ......................................................................... 1,574.43 861.23
Unrealised (Gain)/Loss on foreign currency cash and cash equivalents .. (12.60) 62.65
Total cash and cash equivalents ............................................................. 1,561.83 923.88

2 During the year the Company has acquired/formed the following

subsidiaries :
(a) Mahindra Gears International Limited Rs. 137.83 crores
(b) Mahindra Automotive Australia Pty. Limited Rs. 2.27 crores
(c) Mahindra Two Wheelers Limited Rs. 0.01 crores
3 Pursuant to the Scheme of Amalgamation of Punjab Tractors Limited
(PTL) a subsidiary of the Company, with the Company sanctioned by the
Honourable High Court of Bombay and the Honourable High Court of
Punjab & Haryana vide their orders dated 9th January, 2009 and 16th
January, 2009 respectively, the entire business and all the assets and
liabilities, duties and obligations of PTL were transferred to and vested
in the Company, from 1st August, 2008 (the appointed date) at the
values indicated below :
Loan Fund .............................................................................................. 2.27 —
Fixed Assets (Including Capital Work-in-Progress) .................................. 93.20 —
Investments ............................................................................................ 225.52 —
Current Assets ........................................................................................ 395.94 —
Current Liabilities and Provisions ............................................................ 211.85 —
Deferred Tax Liabilities ............................................................................ 13.10 —
This amalgamation into the Company is a non-cash transaction.
4 Pursuant to the Scheme of Amalgamation of Mahindra Holdings and
Finance Limited (MHFL) a wholly owned subsidiary of the Company,
with the Company as sanctioned by the Honourable High Court of
Bombay vide its order dated 18th July, 2008 the entire business and all
the assets and liabilities, duties and obligations of MHFL were transferred
to and vested in the Company, from 1st February, 2008 (the appointed
date) at the values indicated below :
Fixed Assets ............................................................................................ 4.26 —
Investments ............................................................................................ 342.09 —
Current Assets ........................................................................................ 64.81 —
Deferred Tax Assets ................................................................................. 0.34 —
Current Liabilities and Provisions ............................................................ 40.00 —
This amalgamation into the Company is a non-cash transaction.
5 The Company transferred its Logistics division to a wholly owned
subsidiary in the current year with effect from 1st April, 2008. The value
of the assets and liabilities of the division transferred are at the values
indicated below :
Loan Fund .............................................................................................. 26.14 —
Fixed Assets (Including Capital Work-in-Progress) .................................. 11.86 —
Investments ............................................................................................ * —
Current Assets ........................................................................................ 95.62 —
Current Liabilities and Provisions ............................................................ 79.70 —
This transfer of Logistics division is a non-cash transaction.
6 Previous year’s figures have been regrouped/restated wherever necessary.
* denotes amount less than Rs. 50,000

82
 MAHINDRA & MAHINDRA LIMITED

SCHEDULE I
Rupees crores

2009 2008
Share Capital [Note 2] :
Authorised :
60,00,00,000 (2008 : 37,50,00,000) Ordinary (Equity) Shares of Rs. 10 each ................. 600.00 375.00
25,00,000 Unclassified Shares of Rs. 100 each ............................................................ 25.00 25.00
Total ............................................................................................................ 625.00 400.00
Issued and Subscribed :
27,88,21,265 (2008 : 24,57,41,813) Ordinary (Equity) Shares of
Rs. 10 each fully paid up ............................................................................ 278.82 245.74
278.82 245.74
Less :
62,05,305 (2008 : 66,68,431) Ordinary (Equity) Shares of Rs.10 each fully
paid up issued to ESOP Trust but not allotted to employees ..................... 6.20 6.67
Adjusted : Issued and Subscribed Share Capital ................................................................... 272.62 239.07

SCHEDULE II
Rupees crores
2008 Additions Deductions 2009
Reserves and Surplus
1 Capital Reserve ............................................................... 11.50 — — 11.50
11.50 — — 11.50
2 Securities Premium Account [Note 3(a)(i)] ...................... 527.13 10.86 44.20 493.79
502.10 27.04 2.01 527.13
Less : Premium on shares issued to ESOP Trust
but not allotted to employees [Note 3(b)] ..................... 16.34 — 1.14 15.20
17.98 — 1.64 16.34
510.79 10.86 43.06 478.59
484.12 27.04 0.37 510.79
3 Revaluation Reserve [Note 3(a)(ii)] .................................. 12.47 — 0.38 12.09
12.86 — 0.39 12.47
4 General Reserve .............................................................. 748.92 117.79  39.97 • 826.74
633.92 115.00  — 748.92
Add : Bonus shares issued to ESOP Trust
but not allotted to employees [Note 3(b)] ..................... 3.33 — 0.23 3.10
3.67 — 0.34 3.33
752.25 117.79 40.20 829.84
637.59 115.00 0.34 752.25
5 Debenture Redemption Reserve ...................................... 18.00 29.62  — 47.62
1.12 16.88  — 18.00
6 Investment Fluctuation Reserve [Note 25, 27 & 28] ...... 39.43 806.61 173.90 672.14
39.43 — — 39.43
7 Hedging Reserve Account [Note 3(c)] ............................ (12.92) — 421.27 (434.19)
— — 12.92 (12.92)
1,331.52 964.88 678.81 1,617.59
1,186.62 158.92 14.02 1,331.52
8 Balance for 2008-2009 and earlier years as per
Profit and Loss Account ................................................. 3,365.32
2,775.48
Total ........................................................................ 4,982.91
4,107.00
 Transfer from Profit and Loss Account Rs. 100.00 crores (2008 : Rs. 115.00 crores).
 Amount transferred during the year on amalgamation Rs. 17.79 crores. Refer Note 25(a).
• Adjustment on adoption of Companies (Accounting Standards) Amendment Rules, 2009 on Accounting Standard 11 (Net of Tax
of Rs. 20.58 crores). Refer Note 3(d).
 Transfer from Profit and Loss Account Rs. 29.62 crores (2008 : Rs. 16.88 crores).

83
SCHEDULE III
Rupees crores

2009 2008
Loan Funds [Note 4] :
(A) Secured :
(1) Debentures/Bonds ........................................................................... 600.01 205.51
(2) Foreign Currency Loans from Banks ................................................ 124.29 121.80
(3) Loans and Advances on cash credit account from Banks ............... 3.00 9.04
(4) Short-term Foreign Currency Loans from Banks .............................. 253.70 280.91
981.00 617.26

(B) Unsecured :
(1) Fixed Deposits ................................................................................. 30.85 3.72
(2) Short-term Loans from Banks ......................................................... 80.00 106.14
(3) Other Loans :
(a) From Financial Institutions ....................................................... 634.68 521.13
(b) Foreign Currency Loan from Banks. ......................................... 625.65 491.02
(c) Zero Coupon Convertible Bonds .............................................. 961.52 802.60
(d) 9.25% Fully and Compulsorily Convertible Debentures ............ 700.00 —
(e) From Others ............................................................................. 39.06 45.19
2,960.91 1,859.94
3,071.76 1,969.80
Total ............... 4,052.76 2,587.06

SCHEDULE IV
Fixed Assets [Note 5] : Rupees crores
Description of Assets Cost/ Additions Deduc- Cost/Pro- Deprecia- Deprecia- Deductions Deprecia- Net Net
Professional and tions fessional tion/Amor- tion/ and tion/ Balance Balance
valuation adjust- and valuation tisation Amor- adjust- Amortisa- as at as at
as at 31st ments adjust- as at 31st to 31st tisation ments tion 31st 31st
March, during ments March, March, for 2008- of Depre- to 31st March, March,
2008 the year during 2009 2008 2009 ciation/ March, 2009 2008
the year Amorti- 2009
sation

Land - Freehold ......................... 53.73 4.20 1.75 56.18 — — — — 56.18 53.73

Land - Leasehold ....................... 66.40 0.62 5.74 61.28 2.44 0.69 0.15 2.98 58.30 63.96

Buildings .................................... 518.21 121.55 1.15 638.61 119.79 34.52 0.45 153.86 484.75 398.42

Plant and Machinery ................. 2,669.96 950.64 24.00 3,596.60 1,590.21 413.80 18.32 1,985.69 1,610.91 1,079.75

Furniture and Fittings ................ 96.92 27.40 2.01 122.31 41.38 11.25 0.40 52.23 70.08 55.54

Vehicles, Cycles, etc. .................. 111.06 39.27 18.72 131.61 42.89 21.82 9.86 54.85 76.76 68.17

Development Expenditure .......... 103.49 136.74 — 240.23 24.30 16.84 — 41.14 199.09 79.19

Software Expenditure ................ 36.36 11.01 0.30 47.07 20.67 15.08 0.21 35.54 11.53 15.69

Total ............ 3,656.13 1,291.43 53.67 4,893.89 1,841.68 514.00 29.39 2,326.29 2,567.60 1,814.45
3,229.69 470.79 44.35 3,656.13 1,639.12 239.22 36.66 1,841.68 1,814.45

84
 MAHINDRA & MAHINDRA LIMITED

SCHEDULE V
Investments (At Cost, unless otherwise specified) : Rupees crores
Note 2009 2008
Face Value
Per Unit Long Term Current Long Term Current
Number Rupees
Shares (Non-trade and fully paid-up unless otherwise specified) :
Unquoted :
(a) In Subsidiary Companies :
(i) Equity Shares :
53,98,462 10 Mahindra Engineering and Chemical Products Limited ............. (c)(1) 5.82 — 5.64 —
2,71,00,006 10 Mahindra Intertrade Limited [including 1,50,00,000 shares
partly paid-up Rs. 3 per share] .................................................. 16.60 — 16.60 —
37,23,874 10 Mahindra Steel Service Centre Limited ...................................... 6.38 — 6.38 —
— 10 Mahindra Holdings & Finance Limited ...................................... (c)(2) — — 146.60 —
9,50,00,000 US $ 0.10 Mahindra USA Inc. .................................................................... (c)(3) 44.30 — 19.38 —
16,83,218 10 Mahindra Gujarat Tractor Limited ............................................. 3.55 — 3.55 —
2,46,81,437 10 Mahindra Shubhlabh Services Limited ....................................... (b)(c)(4) 25.72 — 15.87 —
3,47,77,255 10 Mahindra First Choice Wheels Limited (formerly known as
FirstChoice Wheels Limited) ....................................................... (b)(c)(5) 47.44 — 29.21 —
63,49,500 10 Mahindra Logisoft Business Solutions Limited .......................... 5.78 — 5.78 —
42,22,250 US$0.001 Bristlecone Limited ..................................................................... 19.26 — 19.26 —
3,35,70,000 ZAR 1 Mahindra & Mahindra South Africa (Proprietary) Limited ......... (b)(c)(6) 17.24 — 2.49 —
81,26,218 10 Mahindra Engineering Services Limited (formerly known as
Mahindra Engineering Design & Development Company Limited) (b) 59.96 — 59.96 —
4,47,70,000 US $ 1 Mahindra Overseas Investment Company (Mauritius) Limited .. (b)(c)(7) 204.28 — 94.85 —
75,56,900 10 Mahindra SAR Transmission Private Limited .............................. (c)(8) 40.77 — 21.77 —
10,16,24,232 10 Mahindra Renault Private Limited ............................................. (b) 154.38 — 154.38 —
16,33,40,600 10 Mahindra Navistar Automotives Limited (formerly known as
Mahindra International Limited) ................................................ (b)(c)(9) 165.31 — 52.34 —
48,50,00,000 10 Mahindra Vehicle Manufactures Limited (formerly known as
Mahindra Automotive Limited) .................................................. (b)(c)(10)&(11) 485.00 — 124.81 —
1,64,87,602 10 Mahindra Castings Private Limited ............................................ 105.25 — 105.25 —
4,90,49,900 10 Mahindra Logistics Limited ........................................................ (c)(12) 49.05 — 0.05 —
2,11,65,000 10 Mahindra Navistar Engines Private Limited ............................... (c)(13)&(14) 21.17 — 0.51 —
50,000 10 Mahindra Aerospace Private Limited ......................................... 0.05 — 0.05 —
1,10,50,000 10 Mahindra First Choice Services Limited ..................................... (c)(15) 11.05 — 0.05 —
2,07,00,001 EURO 1 Mahindra Gears International Limited ....................................... (c)(16) 137.83 — — —
2,25,49,999 10 Mahindra Holdings Limited ....................................................... (c)(17) 22.55 — — —
5,10,000 10 Mahindra Consulting Engineers Limited .................................... (c)(18) 0.64 — — —
7,33,54,833 10 Mahindra Holidays & Resorts India Limited ............................... (c)(19) 30.25 — — —
50,490 10 NBS International Limited .......................................................... (c)(20) 5.07 — — —
11,80,00,000 10 Mahindra Two Wheelers Limited ............................................... (c)(21) 118.00 — — —
7,00,000 AU $ 1 Mahindra Automotive Australia Pty. Limited ............................. (c)(22) 2.27 — — —
(ii) 7.25% Cumulative Redeemable Preference Shares :
— 100 Mahindra Intertrade Limited ...................................................... (c)(23) — — 18.75 —
70,00,000 US$0.001 (iii) Series’A’ Preference Shares : Bristlecone Limited ....................... 31.72 — 31.72 —
69,20,000 US$0.001 (iv) Series’B’ Preference Shares : Bristlecone Limited ....................... 15.12 — 15.12 —
(v) 10.50% Non Cumulative Redeemable Preference Shares :
10,00,000 100.00 Mahindra Lifespace Developers Limited .................................... (c)(24) 10.00 — — —
23,00,000 EURO 1 Mahindra Gears International Limited ....................................... (c)(16) 15.31 — — —
1,877.12 — 950.37 —
(b) In Other Companies :
(i) Equity Shares :
312 100 Montreal Engineering International Limited .............................. * — * —
8,55,646 10 Machinery Manufacturers Corporation Limited ......................... (b) 0.94 — 0.94 —
1,00,000 10 Judricks (India) Private Limited .................................................. 0.10 — 0.10 —
35,000 10 Mahindra & Mahindra Contech Limited .................................... 0.04 — 0.04 —
75,000 10 NTTF Industries Limited ............................................................. 0.15 — 0.15 —
7,49,997 10 Officemartindia.com Limited ..................................................... 0.22 — 0.22 —
50,000 10 Indian NGOs.com Private Limited .............................................. 0.06 — 0.06 —
20,000 10 Sixth Sense Studios Private Limited ........................................... 0.02 — 0.02 —
2,85,000 10 Utility Engineers (India) Limited ................................................. 0.29 — 0.29 —
9,00,000 10 Mahindra Construction Company Limited ................................. (c)(25) 0.97 — — —
5,00,000 10 Business Standard Limited ......................................................... (c)(26) 0.09 — — —
13,10,000 10 Mahindra Sona Limited ............................................................. (c)(27) 1.64 — — —
75,00,000 10 New Tirupur Area Development Corporation Limited ............... (c)(28) 7.50 — — —
2,81,24,794 10 Owens Corning (India) Limited .................................................. (c)(29) 28.12 — — —
19,750 5 PSL Erickson Limited .................................................................. (c)(30) 0.01 — — —
4,98,000 10 Triton Overwater Transport Agency Limited .............................. (c)(31) 0.58 — — —
Others ........................................................................................ (a) * — * —
(ii) 4% Tax–free Cumulative Preference Shares :
2,296 100 Machinery Manufactures Corporation Limited .......................... (b) 0.02 — 0.02 —
(iii) 11% Redeemable Preference Shares :
1,78,000 100 Sixth Sense Studios Private Limited ........................................... 1.78 — 1.78 —
(iv) 10% Non–Cumulative Redeemable participating Preference Shares :
5,40,000 100 Mahindra Construction Company Limited ................................. (c)(25) 5.40 — — —
(v) 8% Non–Cumulative Redeemable Preferred Stock :
23,00,423 Prana Holdings Inc, USA ........................................................... (c)(32) 13.83 — — —
61.76 — 3.62 —
*denotes amounts less than Rs. 50,000

85
SCHEDULE V (Contd.)
Investments (At Cost, unless otherwise specified) : Rupees crores
Note 2009 2008
Face Value
Per Unit Long Term Current Long Term Current
Number Rupees
Quoted :
(a) In Subsidiary Companies :
(i) Equity Shares :
2,08,46,126 10 Mahindra Lifespace Developers Limited .................................... (b)(c)(24) 276.95 — 216.34 —
5,82,41,532 10 Mahindra & Mahindra Financial Services Limited ...................... 150.91 — 150.91 —
5,37,76,252 10 Tech Mahindra Limited .............................................................. (b) 191.81 — 191.81 —
— 10 Punjab Tractors Limited ............................................................. (c)(33)&(34) — — 1,388.75 —
4,15,26,339 10 Mahindra Forgings Limited ........................................................ (b)(c)(35) 754.14 — 754.14 —
1,64,66,789 10 Mahindra Ugine Steel Company Limited ................................... (c)(36) 49.26 — — —
1,423.07 — 2,701.95 —
(b) In Non-Subsidiary Companies :
(i) Equity Shares :
41,26,417 10 Swaraj Engines Limited .............................................................. (c)(37) 1.63 — 0.95 —
10,59,543 10 Swaraj Automotives Limited ...................................................... (c)(38) 12.45 — 12.39 —
13,41,203 10 Mahindra Composites Limited ................................................... (c)(39) 2.90 — — —
25 100 Jardine Henderson Limited ........................................................ (c)(40) * — — —
2,85,440 10 IDBI Bank Limited ...................................................................... (c)(41) 2.28 — — —
900 10 Power Trading Corporation of India Limited ............................. (c)(42) — * — —
19.26 * 13.34 —
Debentures/Bonds : (Non-trade & fully paid-up) :
Unquoted :
(a) In Subsidiary Companies :
25,00,000 100 2.00 % Mahindra Holdings Limited .................................................... (d)(1) 25.00 — — —
(b) In Other Companies :
13 100 0.50% The East India Clinic Limited ................................................... * — * —
25.00 — * —
Quoted :
(a) In Subsidiary Companies :
200 10,00,000 7.50% Mahindra & Mahindra Financial Services Limited ................... — 20.22 — 20.22
— 10,00,000 8.60% Mahindra & Mahindra Financial Services Limited ................... (d)(2) — — — 10.02
(b) In Other Companies :
— 100 6.75% Tax Free US 64 Bonds ............................................................. (d)(3) — — — 8.09
18 10,00,000 7.00% Power Finance Corporation Limited (2011) Series XXII ........... — 1.80 — 1.80
150 10,00,000 7.99% Infrastructure Development Finance Company Limited ........... — 15.00 — 15.00
— 37.02 — 55.13
25.00 37.02 * 55.13
Less : Excess of cost over fair value of current investments of Debentures/Bonds — (0.35) — (1.44)
25.00 36.67 * 53.69
Other Investments :
Trust Securities
Unquoted :
— Sunrise Initiatives Trust ................................................................................. 51.33 — — —
— M & M Benefit Trust .................................................................................... 1,459.77 — — —
— Mahindra World Motor Driving School Trust ............................................... 0.01 — — —
— M & M Fractional Entitlement Trust ............................................................. 0.01 — — —
Government Securities :
Unquoted :
— 26,000 ^ 6 Years National Savings Certificates .................................................. (f)(1) * — * —
1,511.12 — * —
Quoted :
— 1,92,70,000 ^ Government of India Securities .......................................................... (f)(2) — 1.91 — 17.40
— 1.91 — 17.40
1,511.12 1.91 * 17.40
Less : Excess of cost over fair value of current investments of Government Securities — — — (0.48)
1,511.12 1.91 * 16.92
^ Total Face Value
* denotes amounts less than Rs. 50,000

86
 MAHINDRA & MAHINDRA LIMITED

SCHEDULE V (Contd.)
Investments (At Cost, unless otherwise specified) : Rupees crores
Note 2009 2008
Face Value
Per Unit Long Term Current Long Term Current
Number Rupees
Units :
Unquoted :
— 10 Birla Sun Life Mutual Fund - Cash Plus Institutional Premium Daily
Dividend (formerly known as Birla Mutual Fund) ............................... (g)(3) — — — 11.66
3,48,19,199 10 Birla Sun Life Mutual Fund - Saving Fund Institutional Daily Dividend
(formerly known as Birla Mutual Fund Liquid Plus Institutional Daily
Dividend) ............................................................................................. (g)(4) — 34.84 — 50.00
50,00,000 10 Birla Sun Life Mutual Fund - FTP Institutional Series AV Dividend ..... (g)(6) — 5.00 — —
1,00,00,000 10 Birla Sun Life Mutual Fund - FTP Institutional Series AK Dividend ..... (g)(7) — 10.00 — —
2,37,71,689 10 DBS Chola Mutual Fund - Freedom Income STP Institutional Daily
Dividend Reinvestment Plan ................................................................ (g)(11) — 24.14 — —
— 10 Deutsche Mutual Fund - Insta Cash Plus Fund Super Institutional
Plan Daily Dividend. ............................................................................ (g)(13) — — — 10.70
— 10 Deutsche Mutual Fund - Money Plus Advantage Fund Institutional
Plan Dividend ...................................................................................... (g)(17) — — — 10.12
5,02,28,232 10 Deutsche Mutual Fund - Ultra Short Term Fund Institutional Daily
Dividend .............................................................................................. (g)(18) — 50.30 — —
— 1000 DSP Merrill Lynch Mutual Fund - Cash Plus Institutional Daily
Dividend .............................................................................................. (g)(20) — — — 10.00
— 10 Fortis Mutual Fund - Dual Advantage Fund Plan A Series 1
Institutional Growth (formerly known as ABN AMRO Mutual Fund) . (g)(25) — — — 5.00
5,02,91,350 10 Fortis Mutual Fund - Money Plus Institutional Plan Daily Dividend .... (g)(27) — 50.31 — —
50,74,958 10 Fidelity Mutual Fund - Ultra Short Term Debt Fund Institutional
Daily Dividend ..................................................................................... (g)(31) — 5.08 — —
2,00,70,375 10 Fidelity Mutual Fund - Ultra Short Term Debt Fund Super Institutional
Daily Dividend ..................................................................................... (g)(32) — 20.08 — —
— 10 Franklin Templeton Mutual Fund - Floating Rate Income Fund Long
Term Plan Super Institutional Option Daily Dividend .......................... (g)(33) — — — 26.00
99,933 1000 Franklin Templeton Mutual Fund - India Treasury Management
Account Super Institutional Plan Daily Dividend ................................ (g)(34) — 10.00 — —
3,05,36,597 10 Franklin Templeton Mutual Fund - India Ultra Short Bond Fund Super
Institutional Plan Daily Dividend ......................................................... (g)(35) — 30.57 — —
1,40,65,033 10 Franklin Templeton Mutual Fund - Fixed Horizon Fund Series VII
Plan A Institutional Growth ................................................................ (g)(36) — 14.07 — —
3,23,14,308 10 HDFC Mutual Fund - Cash Management Fund - Savings Plan Daily
Dividend Reinvestment Option ........................................................... (g)(44) — 34.37 — 15.00
1,60,89,947 10 HDFC Mutual Fund - Cash Management Fund - Treasury Advantage
Plan Wholesale Daily Dividend Reinvestment ..................................... (g)(48) — 16.14 — —
3,28,02,032 10 HSBC Mutual Fund - Floating Rate - LT - Institutional Option Weekly
Dividend .............................................................................................. (g)(52) — 36.86 — —
1,59,24,338 10 HSBC Mutual Fund - Fixed Term Series 54 Institutional Dividend
Tenure 370 Days ................................................................................. (g)(55) — 15.92 — —
— 10 IDFC Mutual Fund - Fixed Maturity Plan - Quarterly Series 26
Dividend (formerly known as Standard Chartered Mutual Fund) ....... (g)(59) — — — 10.00
4,99,85,117 10 IDFC Mutual Fund - Cash Fund Super Institutional Plan C Dividend .. (g)(60) — 50.00 — —
2,50,46,616 10 JM Financial Mutual Fund - Money Manager Fund Super Plus Plan
Daily Dividend ..................................................................................... (g)(62) — 25.06 — —
1,18,98,823 10 Kotak Mahindra Mutual Fund - Liquid Institutional Premium Daily
Dividend .............................................................................................. (g)(68) — 14.55 — 15.00
3,01,47,564 10 Kotak Mahindra Mutual Fund - Floater Long Term - Daily Dividend . (g)(69) — 30.39 — —
1,07,38,319 10 Kotak Mahindra Mutual Fund - FMP 14M Series 3 - Institutional
Dividend .............................................................................................. (g)(73) — 10.74 — —
52,85,190 10 Kotak Mahindra Mutual Fund - FMP 15M Series 5 - Institutional
Dividend .............................................................................................. (g)(74) — 5.29 — —
— 10 LIC Mutual Fund - Liquid Fund Dividend Plan .................................... (g)(78) — — — 10.00
5,02,69,757 10 LIC Mutual Fund - Income Plus Fund Daily Dividend Plan ................. (g)(79) — 50.27 — —
1,00,00,000 10 LIC Mutual Fund - Fixed Maturity Plan - Series 43 (13 Months) ........ (g)(80) — 10.00 — —
— 10 Principal Mutual Fund - Floating Rate Fund FMP Institutional Option
Dividend Reinvestment Daily ............................................................... (g)(81) — — — 21.95
— 10 Principal Mutual Fund - Fixed Maturity Plan (FMP - 43) 91 Days Series
XIII Regular Dividend Payout Feb 08 .................................................. (g)(82) — — — 5.00
4,99,96,500 10 Principal Mutual Fund - Cash Management Fund Liquid Option
Institutional Premium Plan Dividend Reinvestment Daily .................... (g)(83) — 50.00 — —
1,99,99,000 10 Prudential ICICI Mutual Fund - Institutional Liquid Plan Super
Institutional Daily Dividend ................................................................. (g)(88) — 20.00 — 15.00
2,88,04,133 10 Prudential ICICI Mutual Fund - Flexible Income Plan Premium Daily
Dividend .............................................................................................. (g)(89) — 30.46 — —
55,00,252 10 Religare Mutual Fund - Liquid Fund - Super Institutional Daily
Dividend (formerly known as Lotus India Mutual Fund) .................... (g)(95) — 5.50 — 10.00
1,95,93,209 10 Religare Mutual Fund - Ultra Short Term Fund - Institutional Daily
Dividend .............................................................................................. (g)(96) — 19.62 — —

87
SCHEDULE V (Contd.)
Investments (At Cost, unless otherwise specified) : Rupees crores
Note 2009 2008
Face Value
Per Unit Long Term Current Long Term Current
Number Rupees
1,49,37,763 10 SBI Mutual Fund - Magnum Insta Cash Fund Daily Dividend Option (g)(102) — 25.02 — —
— 10 Sundaram Mutual Fund - BNP Paribas FTP 90 Days Series 3
Institutional Dividend .......................................................................... (g)(112) — — — 10.00
2,48,51,731 10 Sundaram Mutual Fund - Money Fund Super Institutional Daily
Dividend .............................................................................................. (g)(113) — 25.09 — —
— 10 Tata Mutual Fund - Dynamic Bond Fund Option A Dividend ............. (g)(118) — — — 10.03
2,01,53,392 10 Tata Mutual Fund - Floater Fund Daily Dividend ................................ (g)(119) — 20.23 — —
2,69,174 1000 Tata Mutual Fund - Liquid Super High Investment Fund Daily
Dividend .............................................................................................. (g)(120) — 30.00 — —
— 1000 UTI Mutual Fund - Liquid Cash Plan Institutional Daily Income
Option ................................................................................................. (g)(126) — — — 15.00
— 10 UTI Mutual Fund - Fixed Income Interval Fund Monthly Interval
Plan II Institutional Dividend Plan ....................................................... (g)(127) — — — 10.00
— 10 UTI Mutual Fund - Fixed Maturity Plan HFMP 03/08 I Institutional
Dividend Plan Payout .......................................................................... (g)(129) — — — 25.00
5,05,907 1000 UTI Mutual Fund - Treasury Advantage Fund Institutional Plan Daily
Dividend Option Reinvestment ........................................................... (g)(133) — 50.60 — —
— 830.50 — 295.46
Others :
Certificate of Deposit
Unquoted :
— State Bank of Travancore .................................................................... (h)(1) — — — 23.15
— ABN AMRO Bank ................................................................................ (h)(2) — — — 23.12
— State Bank of Bikaner & Jaipur ........................................................... (h)(3) — — — 42.71
— State Bank of Hyderabad .................................................................... (h)(4) — — — 23.80
— State Bank of Patiala ........................................................................... (h)(5) — — — 24.55
— Union Bank of India ........................................................................... (h)(6) — — — 19.16
— Punjab National Bank ......................................................................... (h)(7) — — — 23.22
— — — 179.71
4,917.33 869.08 3,669.28 545.78
Total ............................. 5,786.41 4,215.06
Cost (net of amounts written off) of Unquoted Investments ................ 4,305.50 1,429.16
Cost of Quoted Investments .................................................................... 1,481.26 2,787.82
5,786.76 4,216.98
Less : Excess of cost over fair value of Current Investments (Net) ........ (0.35) (1.92)
5,786.41 4,215.06

Market Value of Quoted Investments ........................................................ 3,218.81 7,669.90

Notes :
Face Value
Per Unit Long Term Long Term
Number Rupees Rupees Rupees
(a) Shares (unquoted) in other companies :
21 100 # The United Spices Importers Limited (Equity “B” Shares) .............. 1 1
74 16,667 # Engineering & Metal Works, Tehran ............................................... 1 1
(Rials)
Total ............................. 2 2

# Written off to Re 1
(b) Equity investments in these companies carry certain restrictions on transfer of shares in terms of funds raised by these companies
from financial institutions/banks/or in terms of SEBI IPO for listing agreements.

88
 MAHINDRA & MAHINDRA LIMITED

SCHEDULE V (Contd.)
Investments (At Cost, unless otherwise specified) :
(c) The following are the movements in Shares during the year :

Equity Shares Preference Equity Shares Preference

Shares Shares

Acquired Sold Acquired/ Acquired/(Transferred)

(Redeemed/ pursuant to Schemes of
Sold) Amalgamation**

Nos. Nos. Nos. Nos.

(1) Mahindra Engineering & Chemical Products Limited ............................ — — — 20,227 —

(2) Mahindra Holdings & Finance Limited .................................................. — — — (5,13,10,208)£ —
(3) Mahindra USA Inc. ................................................................................ 5,00,00,000+ — — — —
(4) Mahindra Shubhlabh Services Limited ................................................... 98,47,644+ — — — —
(5) Mahindra First Choice Wheels Limited .................................................. 1,21,51,907 — — — —
(6) Mahindra & Mahindra South Africa (Proprietary) Limited ..................... 3,00,00,000+ — — — —
(7) Mahindra Overseas Investment Company (Mauritius) Limited .............. 2,24,30,000 — — — —
(8) Mahindra SAR Transmission Private Limited .......................................... 30,03,161 — — — —
(9) Mahindra Navistar Automotives Limited ................................................ 11,29,65,000 — — — —
(10) Mahindra Vehicle Manufacturers Limited .............................................. 55,00,000@ — — — —
(11) Mahindra Vehicle Manufacturers Limited .............................................. 35,47,00,000 — — — —
(12) Mahindra Logistics Limited .................................................................... 4,90,00,000 100 — — —
(13) Mahindra Navistar Engines Private Limited ............................................ 38,25,000@ — — — —
(14) Mahindra Navistar Engines Private Limited ............................................ 1,68,30,000 — — — —
(15) Mahindra First Choice Services Limited ................................................. 1,10,00,000 — — — —
(16) Mahindra Gears International Limited ................................................... 2,07,00,001 — 23,00,000 — —
(17) Mahindra Holdings Limited ................................................................... — — — 2,25,49,999 —
(18) Mahindra Consulting Engineers Limited ................................................ — — — 5,10,000 —
(19) Mahindra Holidays & Resorts India Limited ........................................... — 8,24,565 — 7,41,79,398 —
(20) NBS International Limited ...................................................................... — — — 50,490 —
(21) Mahindra Two Wheelers Limited ........................................................... 11,80,00,000 — — — —
(22) Mahindra Automotive Australia Pty. Limited ......................................... 7,00,000 — — — —
(23) Mahindra Intertrade Limited .................................................................. — — (18,75,000) — —
(24) Mahindra Lifespace Developers Limited ................................................. — — — 54,45,000 10,00,000
(25) Mahindra Construction Company Limited ............................................. — — — 9,00,000 5,40,000
(26) Business Standard Limited ..................................................................... — — — 5,00,000 —
(27) Mahindra Sona Limited ......................................................................... — — — 13,10,000 —
(28) New Tirupur Area Development Corporation Limited ........................... — — — 75,00,000 —
(29) Owens Corning (India) Limited .............................................................. — — — 2,81,24,794 —
(30) PSL Erickson Limited .............................................................................. — — — 19,750 —
(31) Triton Overwater Transport Agency Limited ........................................... — — — 4,98,000 —
(32) Prana Holdings Inc, USA ........................................................................ — — — — 23,00,423
(33) Punjab Tractors Limited .......................................................................... — — — 7,93,655 —
(34) Punjab Tractors Limited .......................................................................... — — — (3,92,70,165) —
(35) Mahindra Forgings Limited .................................................................... — — — 10 —
(36) Mahindra Ugine Steel Company Limited ............................................... — — — 1,64,66,789 —
(37) Swaraj Engines Limited .......................................................................... — — — 41,19,000 —
(38) Swaraj Automotives Limited .................................................................. — — — 5,80,000 —
(39) Mahindra Composites Limited ............................................................... — — — 13,41,203 —
(40) Jardine Henderson Limited .................................................................... — — — 25 —
(41) IDBI Bank Limited ................................................................................... — — — 2,85,440 —
(42) Power Trading Corporation of India Limited ......................................... — — — 900 —
(43) Swaraj Mazda Limited ........................................................................... — 14,72,000 — 14,72,000 —

** Acquired/(Transferred) pursuant to Schemes of Amalgamation is for consideration other than cash.

£ Transfer is net of cancellation of 9,52,90,385 equity shares.
+ Subscribed to on rights basis.
@ Transferred from application monies of previous year.

89
SCHEDULE V (Contd.)
Investments (At Cost, unless otherwise specified) :
(d) The following are the movements in Debentures/Bonds during the year :

Acquired pursuant to Schemes of

Amalgamation** Sold Matured

Nos. Rs. crores Nos. Nos.

(1) Mahindra Holdings Limited ................................................................... 2.00% 25,00,000 25.00 — —

(2) Mahindra & Mahindra Financial Services Limited .................................. 8.60% — — — 100
(3) Tax Free US 64 Bonds ............................................................................ 6.75% — — — 7,75,000

** Acquired pursuant to Schemes of Amalgamation is for consideration other than cash.

(e) The following are the movements in Trust Securities during the year :

Acquired
pursuant to
Schemes of
Amalgamation** Sold
Nos. Nos.
India Auto Ancillary Trust 0.91 0.91
** Acquired pursuant to Schemes of Amalgamation is for consideration other than cash.

(f) Government Securities :

(1) Face value of Rs. * crores (2008 : Rs. * crores) were lodged as security deposit.
(2) Government of India Securities of the face value Rs. Nil (2008 : Rs. 20.00 crores ) were purchased and of the face value of Rs. 15.00 crores (2008 : Rs. 5.00
crores) sold during the year.
* denotes amounts less than Rs. 50,000
(g) The following are the movements in Units during the year :

Acquired pursuant to Acquired Sold

Schemes of Amalgamation**

Nos. Rs. crores Nos. Rs. crores Nos.

(1) AIG Mutual Fund - India Liquid Fund Super Institutional

Daily Dividend ........................................................................................ — — 5,50,393 55.08 5,50,393
(2) Birla Sun Life Mutual Fund - Interval Income Institutional
Monthly Series 2 Dividend ..................................................................... — — 1,01,39,231 10.14 1,01,39,231
(3) Birla Sun Life Mutual Fund - Cash Plus Institutional Premium
Daily Dividend ........................................................................................ — — 75,69,88,521 758.46 76,86,23,052
(4) Birla Sun Life Mutual Fund - Saving Fund Institutional Daily Dividend . — — 32,31,27,822 323.35 33,82,74,646
(5) Birla Sun Life Mutual Fund - Interval Income Retail Monthly -
Series 2 Dividend Payout ....................................................................... — — 1,00,00,000 10.00 1,00,00,000
(6) Birla Sun Life Mutual Fund - FTP Institutional Series AV
Dividend. ................................................................................................ 50,00,000 5.00 — — —
(7) Birla Sun Life Mutual Fund - FTP Institutional Series
AK Dividend ........................................................................................... 1,00,00,000 10.00 — — —
(8) Birla Sun Life Mutual Fund - Interval Income Institutional
Monthly - Series 1 Dividend .................................................................. — — 50,30,175 5.03 50,30,175
(9) Birla Sun Life Mutual Fund - Quarterly Interval - Series 3 - Dividend
Reinvestment .......................................................................................... 1,03,99,723 10.40 4,31,056 0.43 1,08,30,779
(10) DBS Chola Mutual Fund - Liquid Institutional Daily Dividend
Reinvestment Plan .................................................................................. — — 20,97,70,398 210.71 20,97,70,398
(11) DBS Chola Mutual Fund - Freedom Income STP Institutional Daily
Dividend Reinvestment Plan ................................................................... 1,50,18,612 15.02 4,89,59,909 49.34 4,02,06,832
(12) DBS Chola Mutual Fund - Short Term Floating Rate Fund Daily
Dividend Reinvestment Plan ................................................................... — — 9,97,58,109 100.09 9,97,58,109
(13) Deutsche Mutual Fund - Insta Cash Plus Fund Super Institutional
Plan Daily Dividend ................................................................................ — — 66,25,40,424 663.87 67,32,19,067
(14) Deutsche Mutual Fund - Insta Cash Plus Fund Institutional Plan
Daily Dividend ........................................................................................ — — 99,84,869 10.00 99,84,869
(15) Deutsche Mutual Fund - Liquid Plus Fund - Regular Daily
Dividend Plan ......................................................................................... — — 3,94,29,740 39.49 3,94,29,740
(16) Deutsche Mutual Fund - Money Plus Fund Institutional Daily
Dividend Plan ......................................................................................... — — 3,97,83,542 39.82 3,97,83,542
(17) Deutsche Mutual Fund - Money Plus Advantage Fund Institutional
Plan Dividend ......................................................................................... — — 2,83,717 0.29 1,02,96,326

90
 MAHINDRA & MAHINDRA LIMITED

SCHEDULE V (Contd.)
Investments (At Cost, unless otherwise specified) :
(g) The following are the movements in Units during the year :

Acquired pursuant to Acquired Sold

Schemes of Amalgamation**

Nos. Rs. crores Nos. Rs. crores Nos.

(18) Deutsche Mutual Fund - Ultra Short Term Fund Institutional

Daily Dividend ........................................................................................ — — 22,89,81,874 229.33 17,87,53,642
(19) Deutsche Mutual Fund - Quarterly Interval Fund -Series 1-
Dividend Plan ......................................................................................... 1,50,00,000 15.00 6,35,303 0.64 1,56,35,303
(20) DSP Merrill Lynch Mutual Fund - Cash Plus Institutional Daily
Dividend ................................................................................................. 66,234 6.62 8,41,816 84.19 10,08,040
(21) DSP Merrill Lynch Mutual Fund - Liquidity Fund-Daily
Regular Dividend .................................................................................... — — 12,22,502 1.22 12,22,502
(22) DSP Merrill Lynch Mutual Fund - Liquidity Fund Institutional
Daily Dividend ........................................................................................ — — 51,14,766 511.59 51,14,766
(23) DSP Merrill Lynch Mutual Fund - Liquid Plus Institutional Plan
Daily Dividend ........................................................................................ — — 29,53,352 295.57 29,53,352
(24) DSP Merrill Lynch Mutual Fund - FMP - 6M - Series 6-Institutional
Dividend ................................................................................................. 1,00,35,425 10.04 — — 1,00,35,425
(25) Fortis Mutual Fund - Dual Advantage Fund Plan A Series 1
Institutional Growth ............................................................................... — — — — 50,00,000
(26) Fortis Mutual Fund - Interval Fund Monthly Plan A Dividend ............... — — 1,50,00,000 15.00 1,50,00,000
(27) Fortis Mutual Fund - Money Plus Institutional Plan Daily Dividend ....... — — 6,54,17,194 65.43 1,51,25,844
(28) Fortis Mutual Fund - Cash Fund Institutional Plus Daily Dividend ......... — — 1,00,01,514 10.00 1,00,01,514
(29) Fortis Mutual Fund - Overnight Institutional Plus Daily Dividend .......... — — 17,50,51,750 175.08 17,50,51,750
(30) Fidelity Mutual Fund - Cash Fund Super Institutional Daily Dividend ... — — 8,12,52,033 81.28 8,12,52,033
(31) Fidelity Mutual Fund - Ultra Short Term Debt Fund Institutional
Daily Dividend ........................................................................................ — — 50,74,958 5.08 —
(32) Fidelity Mutual Fund - Ultra Short Term Debt Fund Super
Institutional Daily Dividend .................................................................... — — 2,00,70,375 20.08 —
(33) Franklin Templeton Mutual Fund - Floating Rate Income Fund Long
Term Plan Super Institutional Option Daily Dividend ............................. — — 10,39,42,375 104.03 12,99,14,325
(34) Franklin Templeton Mutual Fund - India Treasury Management
Account Super Institutional Plan Daily Dividend ................................... — — 59,10,229 591.41 58,10,296
(35) Franklin Templeton Mutual Fund - India Ultra Short Bond Fund
Super Institutional Plan Daily Dividend .................................................. — — 24,08,25,609 241.24 21,02,89,012
(36) Franklin Templeton Mutual Fund - Fixed Horizon Fund Series VII
Plan A Institutional Growth ................................................................... 1,40,65,033 14.07 — — —
(37) Franklin Templeton Mutual Fund - Floating Rate Income Fund Long
Term Plan Retail Option Dividend Reinvestment .................................... 4,17,051 0.45 — — 4,17,051
(38) Franklin Templeton Mutual Fund - Fixed Horizon - Series X - Plan D -
Dividend Payout ..................................................................................... — — 60,20,369 6.02 60,20,369
(39) Franklin Templeton Mutual Fund - Floating Rate Income Fund - Long
Term Plan Institutional Option - Growth ............................................... — — 40,30,275 5.00 40,30,275
(40) Franklin Templeton Mutual Fund - Fixed Horizon - Series X - Plan B -
Dividend Payout ..................................................................................... — — 50,06,247 5.01 50,06,247
(41) Franklin Templeton Mutual Fund - India Treasury Management
Institutional Plan Daily Dividend Reinvestment ...................................... — — 60,261 6.03 60,261
(42) Franklin Templeton Mutual Fund - India Ultra Short Bond Fund
Institutional Plan - Daily Dividend Reinvestment ................................... — — 60,13,694 6.02 60,13,694
(43) Franklin Templeton Mutual Fund - Quarterly Interval Plan - Plan B -
Institutional - Dividend Reinvestment .................................................... 61,20,988 6.13 1,20,763 0.12 62,41,751
(44) HDFC Mutual Fund - Cash Management Fund - Savings Plan
Daily Dividend Reinvestment Option ..................................................... — — 65,16,28,357 693.10 63,34,16,565
(45) HDFC Mutual Fund - FMP 90D August 2008 (IX) (4)
Wholesale Plan Dividend Option Payout ................................................ — — 1,51,19,342 15.12 1,51,19,342
(46) HDFC Mutual Fund - FMP 90D June 2008 (VIII) (2) Wholesale Plan
Dividend Option Payout ......................................................................... — — 50,00,000 5.00 50,00,000
(47) HDFC Mutual Fund - Floating Rate Income Fund - Short Term Plan
Wholesale Option Dividend Reinvestment ............................................. 1,49,05,327 15.03 27,31,27,759 275.34 28,80,33,086
(48) HDFC Mutual Fund - Cash Management Fund - Treasury
Advantage Plan Wholesale Daily Dividend Reinvestment ...................... — — 9,08,09,028 91.10 7,47,19,081

91
SCHEDULE V (Contd.)
Investments (At Cost, unless otherwise specified) :
(g) The following are the movements in Units during the year :

Acquired pursuant to Acquired Sold

Schemes of Amalgamation**

Nos. Rs. crores Nos. Rs. crores Nos.

(49) HDFC Mutual Fund - FMP 90D May 2008 (VIII) (4)
Wholesale Plan Dividend Payout ............................................................ — — 1,51,19,342 15.12 1,51,19,342
(50) HDFC Mutual Fund - FMP 90D Feb 2008 (VII) (2) Wholesale Plan
Dividend Payout ..................................................................................... — — 1,51,19,342 15.12 1,51,19,342
(51) HSBC Mutual Fund - Cash Fund - Institutional Plus Daily Dividend ...... — — 58,23,62,241 582.69 58,23,62,241
(52) HSBC Mutual Fund - Floating Rate - LT - Institutional Option
Weekly Dividend .................................................................................... — — 3,28,02,032 36.86 —
(53) HSBC Mutual Fund - Floating Rate - LT - Institutional Daily Dividend .. — — 50,22,673 5.03 50,22,673
(54) HSBC Mutual Fund - Liquid Plus Institutional Plan Daily Dividend ........ — — 21,88,58,315 219.13 21,88,58,315
(55) HSBC Mutual Fund - Fixed Term Series 54 Institutional Dividend
Tenure 370 Days .................................................................................... 1,50,69,611 15.07 8,54,727 0.85 —
(56) HSBC Mutual Fund - Fixed Term Series 55 Institutional Dividend
Tenure 6 Months ................................................................................... 1,00,00,000 10.00 4,18,769 0.42 1,04,18,769
(57) IDFC Mutual Fund - Liquidity Manager Plus Daily Dividend .................. — — 15,53,89,925 424.94 15,53,89,925
(58) IDFC Mutual Fund - Floating Rate Fund LT Institutional Plan B
Daily Dividend ........................................................................................ — — 17,32,73,664 173.37 17,32,73,664
(59) IDFC Mutual Fund - Fixed Maturity Plan - Quarterly Series 26
Dividend ................................................................................................. — — — — 1,00,00,000
(60) IDFC Mutual Fund - Cash Fund Super Institutional Plan C Dividend ..... — — 97,06,61,073 970.90 92,06,75,956
(61) JM Financial Mutual Fund - Interval Fund Quarterly Plan 3
Institutional Dividend Plan ..................................................................... — — 51,08,170 5.11 51,08,170
(62) JM Financial Mutual Fund - Money Manager Fund Super Plus
Plan Daily Dividend ................................................................................ — — 4,69,76,039 47.00 2,19,29,423
(63) JM Financial Mutual Fund - High Liquidy Fund Super
Institutional Plan Daily Dividend ............................................................ — — 25,97,02,009 260.13 25,97,02,009
(64) Kotak Mahindra Mutual Fund - Flexi Debt Scheme
Daily Dividend ........................................................................................ 80,12,113 8.04 5,26,45,401 52.81 6,06,57,514
(65) Kotak Mahindra Mutual Fund - Flexi Debt Scheme Institutional -
Daily Dividend ........................................................................................ — — 13,66,08,899 137.26 13,66,08,899
(66) Kotak Mahindra Mutual Fund - FMP 1M Series 2 Dividend .................. — — 1,50,00,000 15.00 1,50,00,000
(67) Kotak Mahindra Mutual Fund - FMP 1M Series 3 Dividend .................. — — 1,51,07,683 15.11 1,51,07,683
(68) Kotak Mahindra Mutual Fund - Liquid Institutional Premium
Daily Dividend ........................................................................................ — — 73,33,28,532 896.72 73,36,96,537
(69) Kotak Mahindra Mutual Fund - Floater Long Term - Daily Dividend .... — — 7,97,51,723 80.39 4,96,04,159
(70) Kotak Mahindra Mutual Fund - Quarterly Interval Plan - Series 2 -
Dividend ................................................................................................. 51,88,355 5.19 2,30,525 0.23 54,18,880
(71) Kotak Mahindra Mutual Fund - Quarterly Interval Plan - Series 1 -
Dividend ................................................................................................. 49,98,850 5.00 97,438 0.10 50,96,288
(72) Kotak Mahindra Mutual Fund - Quarterly Interval Plan - Series 6 -
Dividend ................................................................................................. 50,91,045 5.09 2,01,894 0.20 52,92,939
(73) Kotak Mahindra Mutual Fund - FMP 14M Series 3 - Institutional
Dividend ................................................................................................. 1,00,62,680 10.06 6,75,639 0.68 —
(74) Kotak Mahindra Mutual Fund - FMP 15M Series 5 - Institutional
Dividend ................................................................................................. 50,00,000 5.00 2,85,190 0.29 —
(75) LIC Mutual Fund - Interval Fund Series 1 Quarterly Dividend Plan ....... — — 1,02,32,672 10.27 1,02,32,672
(76) LIC Mutual Fund - Interval Fund Quarterly Plan Series 2
Quarterly Dividend Plan ......................................................................... — — 51,13,036 5.11 51,13,036
(77) LIC Mutual Fund - Interval Fund Series 1 Monthly Dividend Plan ......... — — 1,01,52,615 10.16 1,01,52,615
(78) LIC Mutual Fund - Liquid Fund Dividend Plan ....................................... — — 35,31,45,690 387.76 36,22,53,075
(79) LIC Mutual Fund - Income Plus Fund Daily Dividend Plan .................... — — 28,90,33,276 289.03 23,87,63,519
(80) LIC Mutual Fund - Fixed Maturity Plan - Series 43 (13 Months) ........... 1,00,00,000 10.00 — — —
(81) Principal Mutual Fund - Floating Rate Fund FMP Institutional Option
Dividend Reinvestment Daily .................................................................. 55,35,476 5.54 22,90,92,346 229.35 25,65,46,774
(82) Principal Mutual Fund - Fixed Maturity Plan (FMP - 43) 91 Days
Series XIII Feb 08 Regular Dividend Payout ........................................... — — — — 50,00,000
(83) Principal Mutual Fund - Cash Management Fund Liquid Option
Institutional Premium Plan Dividend Reinvestment Daily ....................... — — 85,34,42,677 853.50 80,34,46,177

92
 MAHINDRA & MAHINDRA LIMITED

SCHEDULE V (Contd.)
Investments (At Cost, unless otherwise specified) :
(g) The following are the movements in Units during the year :

Acquired pursuant to Acquired Sold

Schemes of Amalgamation**

Nos. Rs. crores Nos. Rs. crores Nos.

(84) Principal Mutual Fund - Floating Rate Fund SMP Institutional

Option Dividend Reinvestment Daily ..................................................... — — 19,57,85,489 195.80 19,57,85,489
(85) Principal Mutual Fund - Fixed Maturity Plan (FMP - 45) 91 Days
Series XIV May 08 Regular Dividend Payout ......................................... 50,00,000 5.00 — — 50,00,000
(86) Principal Mutual Fund - Fixed Maturity Plan (FMP - 48) 91 Days
Series XVI Jun 08 Regular Dividend Payout ........................................... 1,50,16,964 15.02 — — 1,50,16,964
(87) Principal Mutual Fund - Cash Management Fund Liquid Option
Dividend Reinvestment Daily .................................................................. — — 63,02,122 6.30 63,02,122
(88) Prudential ICICI Mutual Fund - Institutional Liquid Plan Super
Institutional Daily Dividend .................................................................... 65,00,928 6.50 64,94,30,487 649.46 65,09,31,665
(89) Prudential ICICI Mutual Fund - Flexible Income Plan
Premium Daily Dividend ......................................................................... — — 25,26,09,539 267.10 22,38,05,406
(90) Prudential ICICI Mutual Fund - Flexible Income Plan Daily Dividend ..... — — 1,37,89,314 14.58 1,37,89,314
(91) Prudential ICICI Mutual Fund - Fixed Maturity Plan Series 44 Three
Month Plan B Retail Dividend Pay Dividend .......................................... 50,00,000 5.00 — — 50,00,000
(92) Prudential ICICI Mutual Fund - Fixed Maturity Plan Series 44 Three
Month Plan C Retail Dividend Pay Dividend .......................................... 1,00,00,000 10.00 — — 1,00,00,000
(93) Prudential ICICI Mutual Fund - Fixed Maturity Plan Series 47 Three
Month Plan B Retail Dividend Pay Dividend .......................................... — — 50,00,000 5.00 50,00,000
(94) Prudential ICICI Mutual Fund - Fixed Maturity Plan Series 47 Three
Month Plan C Retail Dividend Pay Dividend .......................................... — — 1,00,00,000 10.00 1,00,00,000
(95) Religare Mutual Fund - Liquid Fund - Super Institutional Daily
Dividend ................................................................................................. — — 38,71,16,023 387.24 39,16,14,071
(96) Religare Mutual Fund - Ultra Short Term Fund - Institutional
Daily Dividend ........................................................................................ — — 5,22,15,819 52.30 3,26,22,610
(97) Religare Mutual Fund - Monthly Interval Fund - Plan A Dividend ........ — — 51,37,586 5.14 51,37,586
(98) Religare Mutual Fund - Quarterly Interval Fund - Plan D Dividend ....... — — 49,98,550 5.00 49,98,550
(99) Religare Mutual Fund - FMP - 3 Months - Series XXXII - Dividend ...... 50,00,920 5.00 1,04,904 0.10 51,05,824
(100) Religare Mutual Fund - Quarterly Interval Fund Plan I Institutional
Dividend ................................................................................................. — — 52,40,581 5.24 52,40,581
(101) SBI Mutual Fund - Debt Fund Series - 30 Days - 3 - Dividend ............. — — 1,00,00,000 10.00 1,00,00,000
(102) SBI Mutual Fund - Magnum Insta Cash Fund Daily Dividend Option ... — — 7,29,41,362 122.18 5,80,03,599
(103) SBI Mutual Fund - Premier Liquid Fund Super Institutional
Daily Dividend ........................................................................................ — — 10,36,42,166 103.98 10,36,42,166
(104) SBI Mutual Fund - Liquid Plus - Institutional Plan Daily Dividend ......... — — 4,92,72,935 49.30 4,92,72,935
(105) SBI Mutual Fund - Debt Fund Series 90 Days 24 - Dividend ................ 50,03,362 5.00 85,628 0.09 50,88,990
(106) SBI Mutual Fund - Debt Fund Series 90 Days 25 - Dividend ................ 50,00,000 5.00 89,555 0.09 50,89,555
(107) SBI Mutual Fund - Debt Fund Series 90 Days 28 - Dividend ................ — — 52,02,739 5.20 52,02,739
(108) SBI Mutual Fund - Debt Fund Series 90 Days 29 - Dividend ................ — — 52,04,345 5.20 52,04,345
(109) SBI Mutual Fund - Short Horizon Fund Liquid Plus Institutional Plan -
Daily Dividend ........................................................................................ — — 4,53,24,957 45.35 4,53,24,957
(110) Sundaram Mutual Fund - BNP Paribas Interval Fund Quarterly Plan B
Institutional Dividend ............................................................................. — — 51,17,560 5.12 51,17,560
(111) Sundaram Mutual Fund - Liquid Plus Super Institutional Dividend
Reinvestment Daily ................................................................................. — — 2,02,19,758 20.27 2,02,19,758
(112) Sundaram Mutual Fund - BNP Paribas FTP 90 Days Series 3
Institutional Dividend ............................................................................. — — — — 1,00,00,000
(113) Sundaram Mutual Fund - Money Fund Super Institutional
Daily Dividend ........................................................................................ — — 28,34,04,834 286.11 25,85,53,103
(114) Sundaram Mutual Fund - BNP Paribas FTP 90 Days Series 6
Institutional Dividend ............................................................................. — — 1,00,00,000 10.00 1,00,00,000
(115) Sundaram Mutual Fund - BNP Paribas Interval Fund Quarterly Plan E
Institutional Dividend ............................................................................. — — 1,02,23,300 10.22 1,02,23,300

93
SCHEDULE V (Contd.)
Investments (At Cost, unless otherwise specified) :
(g) The following are the movements in Units during the year :

Acquired pursuant to Acquired Sold

Schemes of Amalgamation**

Nos Rs. crores Nos Rs. crores Nos.

(116) Tata Mutual Fund - Fixed Horizon Fund Series 19 Scheme D
Institutional Plan Periodic Dividend ....................................................... — — 51,17,879 5.12 51,17,879
(117) Tata Mutual Fund - Floater Fund Weekly Dividend ............................... — — 3,95,84,832 39.93 3,95,84,832
(118) Tata Mutual Fund - Dynamic Bond Fund Option A Dividend ................ — — 31,434 0.03 95,82,419
(119) Tata Mutual Fund - Floater Fund Daily Dividend ................................... — — 35,15,00,959 352.75 33,13,47,567
(120) Tata Mutual Fund - Liquid Super High Investment Fund Daily Dividend — — 64,37,262 717.45 61,68,088
(121) Tata Mutual Fund - Floating Rate Short Term Institutional Plan
Daily Dividend ........................................................................................ — — 8,18,29,188 81.89 8,18,29,188
(122) Tata Mutual Fund - Income Plus Fund (Option B) Bonus/Income ......... — — 48,61,591 5.11 48,61,591
(123) Tata Mutual Fund - Fixed Income Portfolio Fund A2 Dividend Payout .. — — 1,50,71,986 15.09 1,50,71,986
(124) UTI Mutual Fund - Fixed Income Interval Fund - Monthly Interval Plan
Series 1 Institutional Dividend Plan Payout ............................................ — — 50,00,896 5.00 50,00,896
(125) UTI Mutual Fund - Fixed Income Interval Fund - Series II Quarterly
Interval Plan V Institutional Dividend Plan Payout ................................. — — 1,00,00,000 10.00 1,00,00,000
(126) UTI Mutual Fund - Liquid Cash Plan Institutional Daily Income Option — — 19,64,081 200.23 21,11,220
(127) UTI Mutual Fund - Fixed Income Interval Fund Monthly Interval Plan II
Institutional Dividend Plan ..................................................................... — — 76,553 0.08 1,00,76,553
(128) UTI Mutual Fund - Money Market Fund Daily Dividend Reinvestment
Option .................................................................................................... — — 29,40,91,902 533.67 29,40,91,902
(129) UTI Mutual Fund - Fixed Maturity Plan - HFMP - 03/08 - I - Institutional
Dividend Plan Payout ............................................................................. — — — — 2,50,00,000
(130) UTI Mutual Fund - Fixed Maturity Plan - QFMP - 05/08 - II - Dividend
Plan - Reinvestment ............................................................................... 50,00,000 5.00 88,048 0.09 50,88,048
(131) UTI Mutual Fund - Fixed Maturity Plan - QFMP - 06/08 - II -
Institutional Dividend Plan Payout ......................................................... — — 50,00,000 5.00 50,00,000
(132) UTI Mutual Fund - Fixed Maturity Plan - QFMP - 07/08 - I -
Institutional Dividend Plan - Reinvestment ............................................ 1,00,00,000 10.00 2,16,371 0.22 1,02,16,371
(133) UTI Mutual Fund - Treasury Advantage Fund Institutional Plan
Daily Dividend Option Reinvestment ..................................................... — — 19,67,510 196.79 14,61,603
(134) UTI Mutual Fund - Fixed Income Interval Fund Quarterly Plan
Series 1 - Dividend Plan Reinvestment .................................................. 50,00,000 5.00 99,788 0.10 50,99,788
(135) UTI Mutual Fund - Fixed Income Interval Fund Quarterly Plan -
Series III Institutional Dividend Plan Reinvestment ................................ 1,49,61,783 14.96 6,25,392 0.63 1,55,87,175
(136) UTI Mutual Fund - Fixed Income Interval Fund Series II - Quarterly
Interval Plan VI Institutional Dividend Plan Reinvestment ..................... — — 52,14,878 5.21 52,14,878
(137) UTI Mutual Fund - Fixed Income Interval Fund Series II - Quarterly
Interval Plan VII Institutional Dividend Plan Reinvestment .................... — — 1,04,78,198 10.48 1,04,78,198
**Acquired pursuant to Schemes of Amalgamation is for consideration other than cash.

(h) The following are the movements in Certificate of Deposits during the year :

Acquired Sold Matured

Face Value Total Value Face Value Face Value

Rs. crores Rs. crores Rs. crores Rs. crores

(1) State Bank of Travancore ................................................................................................. — — — 25.00

(2) ABN AMRO Bank ............................................................................................................. — — — 25.00
(3) State Bank of Bikaner & Jaipur ........................................................................................ 50.00 48.93 45.00 50.00
(4) State Bank of Hyderabad ................................................................................................. 50.00 49.03 25.00 50.00
(5) State Bank of Patiala ........................................................................................................ 45.00 43.18 45.00 25.00
(6) Union Bank of India ........................................................................................................ — — — 20.00
(7) Punjab National Bank ...................................................................................................... 25.00 24.88 — 50.00
(8) Axis Bank Limited ............................................................................................................. 40.00 39.32 — 40.00
(9) State Bank of Mysore ...................................................................................................... 10.00 9.77 10.00 —

94
 MAHINDRA & MAHINDRA LIMITED

SCHEDULE VI Rupees crores

2009 2008
Current Assets, Loans and Advances :
(A) Inventories (at cost or net realisable value whichever is lower) :
(i) Finished Products produced and purchased for sale ...................... 471.81 579.43
(ii) Contracts and Work-in-Progress ...................................................... 89.09 53.10
(iii) Manufactured Components ............................................................ 55.71 48.15
(iv) Raw Materials and Bought-out Components .................................. 391.01 351.95
(v) Property Development Activity - Work-in-Progress
[including completed flats and premises Rs. 6.32 crores
(2008 : Rs. 6.32 crores)] [Note 11(b)] ............................................. 6.32 6.32
(vi) Stores and Spares ............................................................................ 23.56 24.76
(vii) Tools ................................................................................................ 23.17 20.40
1,060.67 1,084.11
(B) Sundry Debtors (Unsecured) [Note 6] :
Outstanding over six months : Considered good ................................... 125.74 111.29
: Considered doubtful ............................. 72.12 31.61
197.86 142.90
Other Debts : Considered good ................................... 917.91 893.59
: Considered doubtful ............................. — 1.20
917.91 894.79
1,115.77 1,037.69
Less : Provision for Doubtful Debts ........................................................ 72.12 32.81
1,043.65 1,004.88
(C) Cash and Bank Balances :
Cash, cheques and stamps on hand ...................................................... 354.39 194.27
Balances with Scheduled Banks :
(i) On Current Account ........................................................................ 275.65 109.72
(ii) On Fixed Deposit Account* ............................................................. 938.73 550.59
(iii) On Margin Account ........................................................................ 0.09 0.06
1,214.47 660.37
*[includes balance of unutilised monies raised by issue : Rs. 53.95 cores
(2008 : Rs. 274.03 Crores)]
Balances with Non-Scheduled Banks [Note 7] :
On Current Account ............................................................................... 5.57 6.59
1,574.43 861.23
(D) Other Current Assets :
Interest accrued on Investments ............................................................. 1.42 2.13
Others ..................................................................................................... 0.14 0.14
1.56 2.27
(E) Loans and Advances [Note 8] :
(Unsecured, considered good unless otherwise stated) :
Advances and Loans to subsidiaries :-
Considered good .................................................................................... 402.93 100.73
Considered doubtful ............................................................................... 24.99 5.99
427.92 106.72
Less : Provision for Doubtful Advances and Loans ................................. 24.99 5.99
402.93 100.73
Bills of exchange, considered doubtful .................................................. 1.02 1.02
Less : Provision for Doubtful bills ........................................................... 1.02 1.02
— —
Advances recoverable in cash or in kind or for value to be received :
Considered good .................................................................................... 757.11 470.53
Considered doubtful ............................................................................... 48.64 47.80
805.75 518.33
Less : Provision for Doubtful Advances .................................................. 48.64 47.80
757.11 470.53
Payments towards Income-Tax and Surtax [Note 20(d)] ......................... 221.67 119.92
Balances - Customs, Port Trust, Excise, etc. ............................................ 0.91 0.70
1,382.62 691.88
Total..... 5,062.93 3,644.37

95
SCHEDULE VII Rupees crores

2009 2008
Current Liabilities and Provisions :
(A) Current Liabilities* :
Acceptances ............................................................................................ 106.26 125.79
Sundry Creditors :
(i) Total outstanding dues of micro and small enterprises [Note 9] .... 5.99 4.16
(ii) Total outstanding dues of creditors other than micro and small
enterprises [including Rs. 162.51 crores (2008 : Rs. 112.05 crores)
being advance payments for which value has still to be given] ..... 3,206.19 2,075.43
(iii) Dues to Subsidiaries ........................................................................ 124.62 70.70
3,336.80 2,150.29
Dividend payable .................................................................................... 6.19 4.21
Balances on Directors’ Current Accounts ............................................... 2.21 2.46
Interest accrued but not due on loans ................................................... 68.74 13.80
3,520.20 2,296.55
* There are no amounts due and outstanding to be credited
to the Investor Education and Protection Fund.

(B) Provisions :
Proposed Dividend .................................................................................. 278.83 282.61
Provision for Tax on Proposed Dividend ................................................. 33.23 38.48
Provision for diminution in value of long term investments .................. 201.02 25.17
Provision for premium payable on redemption of convertible bonds .... 269.51 224.97
Provision for compensated absences ...................................................... 245.76 200.76
Provision for taxation ............................................................................. 81.76 37.09
Provision Others [Note 10] ..................................................................... 167.45 134.38
1,277.56 943.46
Total........ 4,797.76 3,240.01

SCHEDULE VIII Rupees crores

2009 2008

Miscellaneous Expenditure
(to the extent not written off or adjusted) :
(a) Finance Charges ..................................................................................... 11.69 5.73
(b) Separation and Other Costs ................................................................... 0.86 7.80
Total........ 12.55 13.53

96
 MAHINDRA & MAHINDRA LIMITED

SCHEDULE IX Rupees crores

2009 2008
Income from Operations and Other Income :
(A) Income from Operations :
Income from services rendered.. ............................................................ 272.45 523.91
Scrap Sales..……….. .............................................................................. 63.73 59.91
Octroi Refund..……….. .......................................................................... 44.90 92.89
Other Operating Income ..……….. ........................................................ 63.54 59.92
Total........ 444.62 736.63

(B) Other Income :

Dividends on Investments in subsidiaries - Gross ................................... 131.83 65.24
Dividends on other Investments - Gross [Note 12(a)] ............................ 46.21 15.01
Profit on sale of Investments (Net) [Note 12(d)] .................................... 53.22 28.94
Miscellaneous Income ............................................................................ 39.08 21.18
Total........ 270.34 130.37

SCHEDULE X Rupees crores

2009 2008

Raw Materials, Finished and Semi-Finished Products :

(A) Decrease/(Increase) in Stock of Finished Goods,
Work-in-Progress and Manufactured Components :
Opening Stock :
(i) Finished Products produced and purchased for sale ...................... 579.43 448.34
(ii) Contracts and Work-in-Progress ...................................................... 53.10 38.24
(iii) Manufactured Components ............................................................ 48.15 44.99
680.68 531.57
Add : Stock Taken Over on Amalgamation :
(i) Finished Products produced and purchased for sale ...................... 80.61 —
(ii) Contracts and Work-in-Progress ...................................................... 11.61 —
92.22 —
Less : Closing Stock :
(i) Finished Products produced and purchased for sale ...................... 471.81 579.43
(ii) Contracts and Work-in-Progress ...................................................... 89.09 53.10
(iii) Manufactured Components ............................................................ 55.71 48.15
616.61 680.68
Decrease/(Increase) in Stock ................................................................... 156.29 (149.11)

(B) Consumption of Raw Materials and Bought-out Components :

Opening Stock ........................................................................................ 351.95 305.52
Add : Purchases [including outside processing charges Rs. 224.06 crores
(2008 : Rs. 251.68 crores)] ........................................................... 8,756.79 7,602.26
9,108.74 7,907.78
Add : Stock Taken Over on Amalgamation ............................................. 54.06 —
Less : Closing Stock ................................................................................ 391.01 351.95
8,771.79 7,555.83
(C) Purchases of Finished Products for sale ................................................. 346.15 319.19
Total........ 9,274.23 7,725.91

97
SCHEDULE XI Rupees crores
2009 2008
Personnel :
Salaries, Wages, Bonus, etc. .......................................................................... 822.36 725.40
Contribution to Provident and other funds ................................................... 58.54 47.48
Gratuity .......................................................................................................... 50.13 14.97
Welfare .......................................................................................................... 93.58 80.29
Total........ 1,024.61 868.14

SCHEDULE XII Rupees crores

2009 2008
Interest, Commitment and Finance Charges :
On Term Loans and Debentures .................................................................... 124.60 80.80
On Others (Net) ............................................................................................. 9.52 6.79
134.12 87.59
Less : Interest Income :
(i) Interest on Government Securities, Debentures and Bonds - Gross
[Note 12(b)] ............................................................................................ 4.76 4.87
(ii) Interest - Others - Gross [Note 12(c)] ..................................................... 84.10 58.48
88.86 63.35
Total........ 45.26 24.24

SCHEDULE XIII Rupees crores

2009 2008
Other Expenses :
Stores consumed ........................................................................................... 66.89 73.01
Tools consumed ............................................................................................. 23.88 15.79
Power and Fuel .............................................................................................. 98.69 91.33
Rent including lease rentals ........................................................................... 49.41 36.40
Rates and Taxes ............................................................................................. 12.68 22.69
Insurance ....................................................................................................... 11.95 13.10
Repairs and Maintenance [Note 13] :
Buildings ................................................................................................. 17.88 17.65
Machinery ............................................................................................... 75.36 73.35
Others ..................................................................................................... 28.29 28.81
121.53 119.81
Advertisement ................................................................................................ 96.49 77.22
Commission on sales/contracts (Net) ............................................................. 47.91 70.74
Discount allowed ........................................................................................... 7.45 5.20
Freight outward ............................................................................................. 215.47 508.95
Sales Promotion Expenses .............................................................................. 208.02 142.40
Miscellaneous Expenses [Note 14] ................................................................. 779.85 452.76
Directors’ fees ................................................................................................ 0.09 0.10
Donations and contributions ......................................................................... 5.97 7.37
Loss on Fixed Assets sold/scrapped/written off (Net) ..................................... 1.19 2.82
Excess of cost over fair value of Current Investments (Net) .......................... (1.57) (1.74)
Provision for doubtful debts/advances (Net) [Note 27] ................................. 31.44 (23.59)
Provision for diminution in value of Long term investments (Net) [Note 28] — (5.40)
Total........ 1,777.34 1,608.96

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 MAHINDRA & MAHINDRA LIMITED

SCHEDULE XlV
Notes on Accounts for the year ended 31st March, 2009

1. Significant Accounting Policies :

(A) Fixed Assets :
(a) (i) Fixed Assets are carried at cost less depreciation except as stated in (ii) below. Cost includes financing cost relating to borrowed
funds attributable to the construction or acquisition of qualifying fixed assets upto the date the assets are ready for use. Where
the acquisition of fixed assets are financed through long term foreign currency loans (having a term of 12 months or more at the
time of their origination) the exchange differences on such loans are added to or subtracted from the cost of such fixed assets.
When an asset is scrapped or otherwise disposed off, the cost and related depreciation are removed from the books of account
and resultant profit (including capital profit) or loss, if any, is reflected in the Profit and Loss Account.
(ii) Land and Buildings, had been revalued as at 31st October, 1984 at depreciated replacement values on the basis of a valuation
made by a firm of Chartered Surveyors and Valuers. The indices, if any, used are not stated in the valuation.
(b) (i) Leasehold land is amortised over the period of the lease.
(ii) Depreciation on assets is calculated on Straight Line Method at the rates and in the manner prescribed in Schedule XIV to the
Companies Act, 1956, except for :
(1) certain items of Plant and Machinery individually costing more than Rs. 5,000 - over their useful lives (2 years, 3 years,
5 years or 7 years, as the case may be) as determined by the Company.
(2) Cars and Vehicles - at 15% of cost.
(iii) Depreciation charge for each year is after deducting the amount representing the depreciation on the increase due to revaluation
of Land and Buildings, transferred from the Revaluation Reserve.
(B) Intangible Assets :
Intangible Assets are initially measured at cost and amortised so as to reflect the pattern in which the asset’s economic benefits are
consumed.
(a) Technical Knowhow :
The expenditure incurred is amortised over the estimated period of benefit, not exceeding six years commencing with the year of
purchase of the technology.
(b) Development Expenditure :
The expenditure incurred on technical services and other project/product related expenses are amortised over the estimated period of
benefit, not exceeding five years.
(c) Software Expenditure :
The expenditure incurred is amortised over three financial years equally commencing from the year in which the expenditure is
incurred.
(C) Investments :
Long term investments are valued at cost. However, provision for diminution in value is made to recognise a decline other than temporary
in the value of investments. Current investments are valued at the lower of cost and fair value, determined by category of investment.
(D) Inventories :
Inventories comprise all costs of purchase, conversion and other costs incurred in bringing the inventories to their present location and
condition.
Raw materials and bought out components are valued at the lower of cost or net realisable value. Cost is determined on the basis of the
weighted average method.
Finished goods produced and purchased for sale, manufactured components and work in progress are carried at cost or net realisable value
whichever is lower. Excise duty is included in the value of finished goods inventory.
Stores spares and tools other than obsolete and slow moving items are carried at cost. Obsolete and slow moving items are valued at cost
or estimated realisable value, whichever is lower.
Long term contracts in progress are valued at cost.
(E) Miscellaneous Expenditure (to the extent not written off or adjusted) :
Expenditure carried forward under this head is being amortised as follows :
(a) Finance Charges :
The expenditure incurred in raising long term borrowings is amortised over the period of the borrowings. On early buyback,
conversion or repayment of borrowings, any unamortised expenditure is fully written off in that year.

99
 (b) Separation and Other Costs :
Special Payments/Pensions under Voluntary Retirement Schemes.
The liability is amortised by the year ended March, 2010 from the month in which the liability is incurred.
(F) Foreign Exchange Transactions :
Transactions in foreign currencies are recorded at the exchange rates prevailing on the date of transaction. Monetary items are translated at
the year-end rates. The exchange difference between the rate prevailing on the date of transaction and on the date of settlement as also on
translation of monetary items at the end of the year (other than those relating to long term foreign currency monetary items) is recognised
as income or expense, as the case may be.
Exchange differences relating to long term foreign currency monetary items, to the extent they are used for financing the acquisition of
fixed assets are added to or subtracted from the cost of such fixed assets and the balance accumulated in ‘Foreign Currency Monetary Item
Translation Difference Account’ and amortised over the balance term of the long term monetary item or 31st March, 2011 whichever is
earlier.
Any premium or discount arising at the inception of a forward exchange contract is recognised as income or expense over the life of the
contract, except in the case where the contract is designated as a cash flow hedge.
(G) Derivative Instruments and Hedge Accounting :
The Company uses foreign currency forward contracts and currency options to hedge its risks associated with foreign currency fluctuations
relating to certain firm commitments and highly probable forecast transactions. The Company does not hold derivative financial instruments
for speculative purposes. The Company has applied to such contracts the hedge accounting principles set out in Accounting Standard (AS)
30 ’Financial Instruments : Recognition and Measurement’ by marking them to market.
Changes in the fair value of the contracts that are designated and effective as hedges of future cash flows are recognised directly in
Hedging Reserve Account and the ineffective portion is recognised immediately in the Profit and Loss Account.
(H) Revenue Recognition :
Sales of products and services are recognised when the products are shipped or services rendered. In respect of sale of property (concerning
property development activity), the Company accounts for the income on the percentage of completion basis. [Refer paragraph (I) below].
Dividend from investments are recognised in the Profit and Loss Account when the right to receive payment is established.
(I) Property Development Activity :
The Company accounts for income on the percentage of completion basis which necessarily involves technical estimates of the percentage
of completion, and costs to completion of the activity, on the basis of which profits/losses are accounted. Such estimates, made by the
Company and certified to the auditors, have been relied upon by them, as these are of a technical nature.
(J) Government Grants :
The Company is entitled to various incentives from a State Government, such as grants by way of refund of octroi duty paid by the
Company for its manufacturing unit located in a developing region. In view of the uncertainty in respect of the collection of these grants,
such grants are accounted for as and when the disbursements are received.
(K) Employee Benefits :
Defined Contribution Plan/Defined Benefit Plan/Long term Compensated Absences.
Company’s contributions paid/payable during the year to Superannuation Fund, ESIC and Labour Welfare Fund are recognised in the Profit
and Loss Account.
Contributions to Provident Fund are made to a Trust administered by the Company and are charged to Profit and Loss Account as incurred.
The Company is liable for the contribution and any shortfall in interest between the amount of interest realised by the investment and the
interest payable to members at the rate declared by the Government of India.
Company’s liability towards gratuity, long term compensated absences and post retirement medical benefit schemes are determined by
independent actuaries, using the projected unit credit method. Past services are recognised on a straight line basis over the average period
until the benefits become vested. Actuarial gains and losses are recognised immediately in the statement of Profit and Loss Account as
income or expense. Obligation is measured at the present value of estimated future cash flows using a discounted rate that is determined
by reference to the market yields at the Balance Sheet date on Government Bonds where the currency and terms of the Government Bonds
are consistent with the currency and estimated terms of the defined benefit obligation.
(L) Borrowing Costs :
All borrowing costs are charged to the Profit and Loss Account except :
(a) Borrowing costs that are attributable to the acquisition or construction of assets that necessarily take a substantial period of time to
get ready for their intended use, which are capitalised as part of the cost of such assets.
(b) Expenses incurred on raising long term borrowings are amortised over the period of borrowings. On early buyback, conversion or
repayment of borrowings, any unamortised expenditure is fully written off in that year.
(M) Redemption Premium :
Premium payable on redemption of Bonds/Debentures is fully provided and charged to Securities Premium Account (Net of Tax) in the year
of issue.

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 MAHINDRA & MAHINDRA LIMITED

(N) Product Warranty :

In respect of warranties given by the Company on sale of certain products, the estimated costs of these warranties are accrued at the time
of sale. The estimates for accounting of warranties are reviewed and revisions are made as required.
(O) Leases :
The Company’s significant leasing arrangements are in respect of operating leases for premises (residential, office, stores, godowns,
computer hardware etc.). The leasing arrangements, which are not non-cancellable, range between eleven months and five years generally,
and are usually renewable by mutual consent on agreed terms. The aggregate lease rentals payable are charged as rent.
(P) Taxes on Income :
Current tax is determined as the amount of tax payable in respect of taxable income for the year. Deferred tax is recognised, subject to
consideration of prudence, on timing differences, being the difference between taxable income and accounting income that originate in
one period and are capable of reversal in one or more subsequent periods. Deferred tax assets arising on account of unabsorbed
depreciation or carry forward of tax losses are recognised only to the extent that there is virtual certainty supported by convincing evidence
that sufficient future tax income will be available against which such deferred tax assets can be realised.
(Q) Excise duty recovered on sales is included in ’Sales – Traded and Manufactured Goods’. Excise duty in respect of Finished Goods
manufactured is shown separately as an item of expense and included in valuation of finished goods produced.
2. Share Capital :
Issued and Subscribed Capital include :
(a) 1,66,809 Ordinary Shares allotted as fully paid-up pursuant to a contract without payment having been received in cash.
(b) 17,06,07,504 Ordinary Shares allotted as fully paid-up by way of Bonus Shares by capitalisation of Securities Premium Account and
Reserves.
(c) 12,56,562 Ordinary Shares issued consequent to the Scheme of Amalgamation with the Union Bank of India Limited. Of these, 13,737
Ordinary Shares were issued on conversion of 41,211 8% Bonds.
(d) 12,98,202 Ordinary Shares issued consequent to the Scheme of Amalgamation with International Tractor Company of India Limited
without payment having been received in cash.
(e) 1,88,166 Ordinary Shares issued consequent to the Scheme of Amalgamation with Mahindra Spicer Limited without payment having been
received in cash.
(f) 9,73,200 Ordinary Shares issued consequent to the Scheme of Amalgamation with Mahindra Nissan Allwyn Limited without payment
having been received in cash.
(g) 1,28,27,552 Ordinary Shares issued consequent to the Scheme of Amalgamation with Mahindra Holdings and Finance Limited without
payment having been received in cash.
(h) 2,02,51,900 Ordinary Shares issued consequent to the Scheme of Amalgamation with Punjab Tractors Limited without payment having
been received in cash.

3. Reserves and Surplus :

Rupees crores
2009 2008

(a) Movements during the year :

(i) Securities Premium Account :
Additions, arising out of exercise of options ..................................................... 1.02 1.34
Reversal of Premium on buyback of Zero Coupon Convertible Bonds
(Net of Tax of Rs. 5.07 crores (2008 : Rs. Nil)) .................................................. 9.84 —
Premium on conversion of Debentures and Bonds ............................................ — 11.62
Reduction of provision for premium on redemption of Zero Coupon
Convertible Bonds (Net of Tax of Rs. Nil ( 2008 : Rs. 5.54 crores)) ................... — 14.08

10.86 27.04
Applied, in accordance with Section 78 of the Companies Act, 1956, towards :
Writing-off of share and bonds/debenture issue expenses
(Net of Tax of Rs. 0.54 crores ( 2008 : Rs. 0.49 crores)) ................................... 4.95 2.01
Increase of provision for premium on redemption of Zero Coupon Convertible
Bonds (Net of Tax of Rs. 20.20 crores (2008 : Rs. Nil)) ..................................... 39.25 —

44.20 2.01
(ii) Revaluation Reserve :
Adjusted against depreciation for the year [Note 1 (A)(b) (iii)] ......................... 0.38 0.39
0.38 0.39

101
 (b) The Guidance Note on Accounting for Employee Share-based Payments issued by The Institute of Chartered Accountants of India requires
that shares allotted to a trust but not transferred to employees be reduced from Share Capital and Reserves. Accordingly, the Company has
reduced the Share Capital by Rs. 3.10 crores (2008 : Rs. 3.34 crores), Securities Premium Account by Rs. 15.20 crores (2008 : Rs. 16.34
crores) for the 31,02,653 shares (2008 : 33,34,216 shares) held by the trust pending transfer to the eligible employees.
The Share Capital of the Company has also been reduced and the General Reserve increased by Rs. 3.10 crores (2008 : Rs. 3.33 crores) for
the bonus shares issued by the Company in September, 2005 to the trust but not yet transferred by the trust to the employees. The above
monies which are treated as advance received from it, is included under current liabilities.
(c) Consequent to the announcement issued by The Institute of Chartered Accountants of India dated 29th March, 2008 in respect of forward
exchange contracts and currency and interest rate swaps, the Company has applied the Hedge Accounting Principles set out in the
Accounting Standard (AS) 30 ‘Financial Instruments : Recognition and Measurement’. Accordingly, such contracts are marked to market
and the loss aggregating Rs. 434.19 crores (Net of Tax of Rs. 223.57 crores) (2008 : Rs. 12.92 crores (Net of Tax of Rs. 6.66 crores)) arising
consequently on contracts that were designated and effective as hedges of future cash flows has been recognized directly in the Hedging
Reserve Account.
(d) In line with the notification dated 31st March, 2009 issued by The Ministry of Corporate Affairs, amending Accounting Standard (AS) 11 –
‘Effects of Changes in Foreign Exchange Rates’, the Company has chosen to exercise the option under paragraph 46 inserted in the
standard by the notification.
Accordingly with retrospective effect from 1st April, 2007 exchange differences on all long term monetary items are :
(i) to the extent such items are used for financing fixed assets, added to/subtracted from the cost of those fixed assets and depreciated
over the balance useful life of the asset.
(ii) in other cases accumulated in the ‘Foreign Currency Monetary Item Translation Difference Account’ and amortised over the balance
period of such long term monetary item but not beyond 31st March, 2011.
Arising from the above the Company has :
(i) charged to the opening General Reserve Rs. 39.97 crores (Net of Tax of Rs. 20.58 crores) which was recognised in the Profit and Loss
Account in previous financial year ended 31st March, 2008.
(ii) added to fixed assets Rs. 131.73 crores and to Capital Work-in-Progress Rs. 41.24 crores being the exchange differences on long term
monetary items relatable to the acquisition of fixed assets.
(iii) charged to the Profit and Loss Account Rs. 24.61 crores.
(iv) carried forward Rs. 18.11 crores in the ‘Foreign Currency Monetary Item Translation Difference Account’ being the amount remaining
to be amortised as at 31st March, 2009.
As a result of the above change in Accounting Policy the net profit before tax for the year is higher by Rs. 251.63 crores (Net of Tax
Rs. 166.10 crores).
4. Loans :
(a) Debentures are redeemable/convertible as follows :
(i) Rs. 700 crores Fully and Compulsorily Convertible Debentures on 28th January, 2010.
(ii) Rs. 200 crores on 9th January, 2011.
(iii) Rs. 400 crores in three equal instalments from 12th December, 2013.
(iv) Rs. 0.01 crores of 12.50% Debentures and Zero Interest Bonds on receipt of balance amount due on allotment.
(b) (i) Debentures of Rs. 600.01 crores and Foreign Currency Loans from Banks of Rs. 124.29 crores are secured by a pari-passu charge on
immovable properties of the Company both present and future, subject to certain exclusions and are also secured by pari-passu charge on
the movable properties of the Company including movable machinery, machinery spares, tools and accessories, both present and future.
(ii) Short Term Foreign Currency Loan of Rs. 253.70 crores from banks and Loans and Advances on cash credit accounts from the Company’s
bankers are secured by a first charge on a pari-passu basis on the whole of the current assets of the Company namely inventories, book
debts, outstanding monies, receivables, claims etc. both present and future.
(c) The following amounts are repayable/convertible by 31st March, 2010 :
(i) Debenture holders .......................................................................... : Rs. 700.00 crores (2008 : Rs. 5.50 crores)
(ii) Foreign currency loans from Banks (secured) ................................. : Rs. 355.18 crores (2008 : Rs. 304.41 crores)
(iii) Fixed Deposit holders ..................................................................... : Rs. 4.88 crores (2008 : Rs. 2.15 crores)
(iv) Rupee Loans :
(a) from banks ............................................................................. : Rs. 80.00 crores (2008 : Rs. 106.14 crores)
(b) from others ............................................................................. : Rs. 10.13 crores (2008 : Rs. 6.14 crores)
st
The Company had issued during the year ended 31 March, 2007, Zero Coupon Foreign Currency Convertible Bonds (Bonds 2011) aggregating
US$ 200 million, at par. The bond holders have an option to convert these bonds into Equity Shares with full voting rights or Global Depository
Receipts (GDRs) determined at an initial conversion price of Rs. 922.04 per share with fixed exchange rate of conversion of Rs. 44.42 = US$ 1,
at any time on or after 7th May, 2006 upto 7th March, 2011.

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 MAHINDRA & MAHINDRA LIMITED

The Bonds 2011 may be redeemed, in whole but not in part, at the option of the Company at any time on or after 13th April, 2008 subject to
satisfaction of certain conditions. Unless previously converted, redeemed or purchased and cancelled, the bonds fall due for redemption on 14th
April, 2011 at 128.03 per cent of their principal amount. Upto 31st March, 2009, none of the Bonds 2011 have been converted into equity
shares/GDRs.
During the year Bonds 2011 of the face value of US$ 10.50 million were bought back and cancelled.
Premium payable on redemption of Bonds 2011 had been fully provided in the previous year by debiting the same to Securities Premium
Account (SPA). Consequent to the buyback, premium aggregating Rs. 9.84 crores (Net of Tax of Rs. 5.07 crores) no longer payable has been
credited back to SPA during the year.
The net proceeds of Rs. 53.95 crores, unutilised as at 31st March, 2009, is disclosed under Cash and Bank balances.
The Company had issued during the year ended 31st March, 2009, 93,95,974 Unsecured Fully and Compulsorily Convertible Debentures (FCD’s)
having a face value of Rs. 745 per FCD for an aggregate consideration of Rs. 700 crores. The FCD’s have a tenure of 18 months and carry a
coupon rate of 9.25% until conversion or date of maturity whichever is earlier. The FCD holder has the option to convert each FCD into one
equity share of face value Rs. 10 at a premium of Rs. 735, at anytime within 18 months from 28th July, 2008. Unless previously converted, each
FCD will be compulsorily converted into one equity share of Rs. 10 each at a premium of Rs. 735 on 28th January, 2010. Upto 31st March, 2009,
none of the FCD’s have been converted into equity shares.
5. (a) Buildings include Rs. * crores (2008 : Rs. * crores) being the value of shares in co-operative housing societies.
(b) Additions to Plant and Machinery include Rs. 9.65 crores (2008 : Rs. Nil) on account of capitalisation of interest and Rs. 131.73 crores
debit (Net) (2008 : Rs. Nil) on account of foreign exchange fluctuation.
(c) (i) The depreciation charge for the year excludes :
(a) An amount of Rs. 0.38 crores (2008 : Rs. 0.39 crores), representing depreciation on the increase due to revaluation of Land and
Buildings transferred from the Revaluation Reserve.
(b) An amount of Rs. Nil (2008 : Rs. 0.17 crores), representing depreciation on assets used for development work. This expenditure
is transferred to Development Expenditure and is appropriately amortised.
(ii) The net credit to the Profit and Loss Account consequent to the above adjustments to the Revaluation Reserve is Rs. 0.38 crores (2008
: Rs. 0.39 crores).
(d) Addition to Fixed Assets and Depreciation/Amortisation for the year includes the following assets transferred on Amalgamation :
Rupees crores

Description of Assets Cost Depreciation/

Amortisation
Land – Freehold ................................................................. 3.95 —
Building .............................................................................. 38.59 17.57
Plant and Machinery .......................................................... 253.35 193.90
Furniture and Fittings ........................................................ 5.84 4.16
Vehicles, Cycles, etc ........................................................... 9.71 5.70
Software Expenditure ......................................................... 1.87 0.78

Total .................................................................................. 313.31 222.11

6. Sundry Debtors others include Rs. 0.59 crores (2008 : Rs. 0.22 crores), which, in accordance with the terms of the contracts, were not due for
payment as at 31st March, 2009.
7. Cash and Bank Balances include balances lying with non-scheduled banks :
In Current Account
Rupees crores
Bank Tejarat, Bank of Australia Bank of China The Municipal The Ahmednagar
Tehran Co-op. Bank Ltd. Merchant’s Co-op. Bank Ltd.
Balance as at 31st March, 2009 ...................... * 3.34 0.09 2.13 *
Balance as at 31st March, 2008 ...................... * 4.38 0.06 2.15 —
Maximum balance during the year ................. * 9.51 1.47 3.23 *
Maximum balance during the previous year ... * 5.62 1.41 3.61 —

8. Loans and Advances include :

(a) Fixed/Call deposits with/loans to limited companies Rs. 411.14 crores (2008 : Rs. 71.44 crores) including Rs. 404.65 crores (2008 : Rs.
64.95 crores) with/to subsidiaries.
(b) Amounts paid towards joint development of property Rs. 1.54 crores (2008 : Rs. 1.54 crores).
(c) Share Application money pending allotment Rs. Nil (2008 : Rs. 9.33 crores) to subsidiaries.
* denotes amount less than Rs. 50,000

103
9. Micro, Small and Medium enterprises have been identified by the Company on the basis of the information available. Total outstanding dues of
Micro and Small enterprises, which are outstanding for more than the stipulated period are given below : -
Rupees crores

2009 2008

(a) Dues remaining unpaid as at 31st March

Principal 2.42 3.09
Interest 0.05 0.04

(b) Interest paid in terms of Section 16 of the Act 0.03 —

(c) Amount of interest due and payable for the period of delay on
payments made beyond the appointed day during the year 0.15 0.10
(d) Amount of interest accrued and remaining unpaid as at 31st March 0.32 0.15

(e) Further interest due and payable even in the succeeding years, until such date
when the interest due as above are actually paid to the small enterprises 0.13 0.01

10. (a) Provision - Others Rs. 167.45 crores (2008 : Rs. 134.38 crores) includes provision for contingencies Rs. 8.25 crores (2008 : Rs. 8.16 crores),
provision for warranty Rs. 137.45 crores (2008 : Rs. 106.42 crores) and provision for diminution in value of certain assets substantially
retired from active use Rs. 16.91 crores (2008 : Rs. 17.01 crores). Provision for contingencies is in respect of labour demands under
negotiations at certain locations of the Company. Provision for warranties relates to warranty provision made in respect of sale of certain
products, the estimated cost of which is accrued at the time of sale. The products are generally covered under a free warranty period
ranging from 6 months to 3 years.
(b) The movement in above provisions is as follows :
Rupees crores
Warranty Contingency
2009 2008 2009 2008
Provisions
Balance as at 1st April 106.42 85.32 8.16 —
Add : On Amalgamation during the year 0.25 — — —

Add : Provision made during the year 85.05 90.78 5.41 8.16
Less : Utilisation during the year 54.27 69.68 5.32 —
st
Balance as at 31 March 137.45 106.42 8.25 8.16

11. (a) Sales include :

(i) Export benefits Rs. 26.99 crores (2008 : Rs. 28.64 crores).

(ii) Cost of items given for sales promotion/as donations Rs. 0.77 crores (2008 : Rs. 0.32 crores).

(b) Stock-in-Trade, Property Development Activity, includes completed premises Rs. 3.13 crores (2008 : Rs. 3.13 crores), which, pending sale,
have been given out on leave and licence basis for which fresh agreement is under negotiation.

12. (a) Dividends on other investments includes Rs. 44.89 crores (2008 : Rs. 15.01 crores) in respect of current investments and Rs. 1.32 crores
(2008 : Rs. Nil) in respect of long term investments.

(b) Interest on Government Securities, Debentures and Bonds includes tax deducted at source Rs. 0.11 crores (2008 : Rs. 0.90 crores) and
comprise Rs. 0.50 crores (2008 : Rs. 0.28 crores) and Rs. 4.26 crores (2008 : Rs. 4.59 crores) in respect of long term and current
investments respectively.

(c) Interest received - others includes tax deducted at source Rs. 15.11 crores (2008 : Rs. 3.91 crores).

(d) Profit on sale of investments (Net) includes profit on disposal of current investments (Net) Rs. 14.73 crores (2008 : Rs. 14.72 crores), and
profit on disposal of long term investments (Net) Rs. 38.49 crores (2008 : Rs. 14.22 crores).

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 MAHINDRA & MAHINDRA LIMITED

13. Repairs and Maintenance includes machinery spares consumed Rs. 26.25 crores (2008 : Rs. 22.19 crores) but does not include items included
under Consumption of Raw Materials and Bought-out Components and amounts charged to salaries and wages (amounts not ascertained).
14. Miscellaneous Expenses include :
(a) Amounts paid/payable to Auditors (net of service tax where applicable) :
Rupees crores

Statutory Auditors Cost Auditors

(i) Audit Fees ......................................................................................................................... 1.08 0.02

0.91 0.02
(ii) Company Law matters ...................................................................................................... * —
* —
(iii) Other Services ................................................................................................................... 0.63 —
0.74 —
(iv) Reimbursement of expenses ............................................................................................. 0.05 —
0.06 *

1.76 0.02
1.71 0.02

(b) An amount of Rs. 0.96 crores (2008 : Rs. 0.96 crores) payable as commission to non-wholetime Directors – Note 15 and Schedule XV.

15. Managerial remuneration for Directors included in the Profit and Loss Account is Rs. 6.29 crores (2008 : Rs. 6.54 crores) including Directors’
fees of Rs. 0.09 crores (2008 : Rs. 0.10 crores), perquisites Rs. 1.27 crores (2008 : Rs. 1.25 crores) and commission Rs. 3.16 crores (2008 :
Rs. 3.41 crores) (See Schedule XV) and excluding charge for gratuity, provision for leave encashment and post retirement medical benefit as
separate actuarial valuation figures are not available. The above perquisites include amortisation of Employees Stock Options amounting to Rs.
0.09 crores (2008 : Rs. 0.09 crores).
16. Employee Benefits
Defined benefit plans – as per Actuarial valuation on 31st March, 2009.
Gratuity (Funded) Rupees crores
2009 2008

I. Expense recognised in the Statement of

Profit and Loss Account for the year ended 31st March
1. Current Service Cost 16.59 13.20
2. Interest 18.30 14.84
3. Expected Return on Plan Assets (18.16) (12.45)
4. Actuarial (Gain)/Loss 33.40 (0.62)
5. Total expense 50.13 14.97
st
II. Net Asset/(Liability) recognised in the Balance Sheet as at 31 March
1. Present value of Defined Benefit Obligation as at 31st March 300.61 201.76
st
2. Fair value of plan assets as at 31 March 206.14 163.58
3. Funded status [Surplus/(Deficit)] (94.47) (38.18)
4. Net asset/(liability) as at 31st March (94.47) (38.18)
III. Change in the obligation during the year ended 31st March
1. Present value of Defined Benefit Obligation at the beginning of the year 201.76 184.43
2. Addition on account of amalgamation 40.90 —
3. Current Service Cost 16.59 13.20
4. Interest Cost 18.30 14.84
5. Actuarial (Gain)/Loss 33.40 (0.62)
6. Benefit payments ** (10.34) (10.09)
7. Present Value of Defined Benefit Obligation at the end of the year 300.61 201.76

**Includes benefit payment recoverable Rs. 0.53 crores (2008 : Rs. 2.73 crores).
* denotes amounts less than Rs. 50,000

105
 Rupees crores

2009 2008

IV. Change in Fair Value of Assets during the year ended 31st March
1. Fair Value of Plan assets at the beginning of the year 163.58 127.04
2. Addition on account of amalgamation 29.16 —
3. Expected return on plan assets 18.16 12.45
4. Contributions by employer 5.05 31.45
5. Actual benefits paid (9.81) (7.36)
6. Fair value of Plan assets at the end of the year 206.14 163.58
7. Actual return on plan assets 18.16 12.45
V. The major categories of plan assets as a percentage of total plan
Funded with LIC 100% 100%
VI. Actuarial assumptions
1. Discount Rate 7.75% 8.05%
2. Expected rate of return on plan assets 9.25%-9.50% 9.45%
3. In-service Mortality Indian Assured Lives Mortality
(1994-96) Modified ultimate
4. Turnover Rate 5% Age 21 to 30 - 10%
Age 31 to 40 - 5%
Age 41 to 50 - 3%
Age 51 & above - 2%

VII. Experience Adjustments Period Ended

2009 2008 2007

1. Defined Benefit Obligation 300.61 201.76 184.43
2. Fair Value of Plan Assets 206.14 163.58 127.04
3. Surplus/(Deficit) (94.47) (38.18) (57.39)
4. Experience Adjustment on Plan Liabilities [(Gain)/Loss] 32.04 (3.36)

Post Retirement Medical Benefits (Unfunded) Rupees crores

2009 2008

I. Expense recognised in the Statement of Profit and Loss

Account for the year ended 31st March

1. Current Service Cost 0.22 0.21

2. Interest 0.24 0.28

3. Actuarial (Gain)/Loss 1.81 (0.77)

4. Total expense 2.27 (0.28)

II. Net Asset/(Liability) recognised in the Balance Sheet as at 31st March

1. Present value of Defined Benefit Obligation as at 31st March 4.84 2.79

2. Funded status [Surplus/(Deficit)] (4.84) (2.79)

3. Net Asset/(Liability) as at 31st March (4.84) (2.79)

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 MAHINDRA & MAHINDRA LIMITED

Rupees crores

2009 2008

III. Change in the obligation during the year ended 31st March
1. Present value of Defined Benefit Obligation at the beginning of the year 2.79 3.22
2. Current Service Cost 0.22 0.21
3. Interest Cost 0.24 0.28
4. Actuarial (Gain)/Loss 1.81 (0.77)
5. Benefit payments (0.22) (0.15)
6. Present Value of Defined Benefit Obligation at the end of the year 4.84 2.79
IV. Change in Fair Value of Assets during the year ended 31st March
1. Contributions by employer 0.22 0.15
2. Actual benefits paid (0.22) (0.15)
V. Actuarial assumptions
1. Discount Rate 7.75% 8.05%
2. In-service Mortality Indian Assured Lives Mortality
(1994-96) Modified ultimate
3. Turnover Rate 5% Age 21 to 30 -10%
Age 31 to 40 - 5%
Age 41 to 50 - 3%
Age 51 & above- 2%
4. Medical premium inflation 5% 3%

VI. Effect of one percentage point change in the assumed medical inflation rate One percentage point One percentage point
increase in medical decrease in medical
inflation rates inflation rates
2009 2008 2009 2008
1. Effect on the aggregate service and interest cost of Post
Employment Medical Benefits 0.14 0.05 (0.11) (0.08)
2. Effect on the accumulated Post Employment Medical Benefits obligations 0.72 0.38 (0.60) (0.32)

VII. Experience Adjustments Period Ended

2009 2008 2007
1. Defined Benefit Obligation 4.84 2.79 3.22
2. Surplus/(Deficit) (4.84) (2.79) (3.22)
3. Experience Adjustment on Plan Liabilities 1.24 (0.55) 0.07

Basis used to determine expected rate of return on assets :

Based on expectation of the average long term rate of return expected on investment of the fund, during the estimated term of obligation.
The estimate of future salary increase, considered in actuarial valuation, takes account of inflation, seniority, promotion and other relevant
factors, such as supply and demand in the employment market.
17. The Company had allotted 55,24,219 ordinary (equity) shares in the year ended 31st March, 2002, to the Mahindra & Mahindra Employees’
Stock Option Trust set up by the Company. The trust holds these shares for the benefit of the employees and issues them to the eligible
employees as per the recommendation of the Compensation Committee.
In respect of options granted prior to 29th September, 2006, the equity settled options vest one year from the date of the grant and are
exercisable on specified dates in 3 tranches within a period of 5 years from the date of vesting. The number of options exercisable in each
tranche is between the minimum of 100 and a maximum of 1/3rd of the options vested, except in case of the last date of exercise, where the
employee can exercise all the options vested but not exercised till that date.
Options granted on or after 29th September, 2006, vest in 4 equal instalments on the expiry of 12 Months, 24 Months, 36 Months and
48 Months from the date of grant. The options may be exercised on the date of vesting and on specified dates within 5 years from the date of
vesting. Number of vested options exercisable on each specified date is subject to a minimum of 50 or number of options vested whichever is
lower, except in case of the last date of exercise, where the employee can exercise all the options vested but not exercised till that date.
The compensation costs of stock options granted to employees are accounted by the Company using the intrinsic value method.

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 Summary of Stock Options
No. of stock options Weighted average
exercise price (Rs.)

Options outstanding on 1st April, 2008 35,86,368 557.33

Options granted during the year 26,34,363 500.00
Options forfeited/lapsed during the year 1,41,684 622.15
Options exercised during the year 4,63,126 220.82
Options outstanding on 31st March, 2009 56,15,921 556.55
Options vested but not exercised on 31st March, 2009 13,47,050 464.03

Average share price on the date of exercise of the options are as under :
Date of exercise Average share price (Rs.)
31st May, 2008 603.43
11th June, 2008 575.55
th
14 June, 2008 571.93

Information in respect of options outstanding as at 31st March, 2009.

Range of exercise price Number of options Weighted average

remaining life

Rs. 29.50 - Rs. 61.50 12,526 0.17 yrs

Rs. 215.00 - Rs. 227.00 6,39,268 2.17 yrs
Rs. 361.00 27,742 2.57 yrs
Rs. 616.00 - Rs. 620.00 8,18,300 4.79 yrs
Rs. 762.00 15,49,971 5.82 yrs
Rs. 500.00 25,68,114 6.87 yrs
The fair value of options granted during the year on 13th August, 2008 is Rs. 219.77 per share.
The fair value has been calculated using the Black Scholes Options Pricing Model and the significant assumptions made in this regard are as
follows :
Grant dated
13th Aug, 2008
Risk free interest rate 9.17%
Expected life 2.50 Years
Expected volatility 38.84%
Expected dividend yield 2.80%
Exercise price (Rs.) 500.00
Stock price (Rs.) 593.35
In respect of Options granted under the Employee Stock Option plan, in accordance with guidelines issued by SEBI, the accounting value of the
options is accounted as deferred employee compensation, which is amortised on a straight line basis over the period between the date of grant
of options and eligible dates for conversion into equity shares. Consequently, salaries, wages, bonus, etc. includes Rs. 3.57 crores (2008 :
Rs. 2.16 crores) being the amortisation of deferred employee compensation, after adjusting for reversals on account of options lapsed.

Had the Company adopted fair value method in respect of options granted on or after 1st April, 2005, the employee compensation cost would
have been higher by Rs. 33.90 crores, Profit after tax lower by Rs. 33.90 crores and the basic and diluted earnings per share would have been
lower by Rs. 1.24 and Rs. 1.15 respectively.

18. The estimated amount of contracts remaining to be executed on capital account and not provided for as at 31st March, 2009 is Rs. 756.32
crores (2008 : Rs. 522.77 crores).
19. The Commissioner of Central Excise (Adjudication), Navi Mumbai, passed an order on 30th March, 2005, confirming the demand made on the
Company for payment of differential excise duty (including penalty) of Rs. 304.11 crores in connection with the classification of Company’s
Commander range of vehicles, during the years 1991-1996. Whilst the Company had classified the Commander range of vehicles as 10-seater
attracting a lower rate of excise duty, the Commissioner of Central Excise (Adjudication), Navi Mumbai, has held that these vehicles could not be
classified as 10-seaters and as such attracted a higher rate of excise duty. In earlier proceedings, the Collector of Central Excise, Mumbai as also
the Collector Central Excise (Appeals), Mumbai had upheld the classification of these vehicles as 10-seaters. Similarly, certain statutory/expert
bodies have also confirmed the concerned vehicles to be 10-seater vehicles.

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 MAHINDRA & MAHINDRA LIMITED

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has also by its order dated 19th July, 2005 upheld this classification. The
department’s Statutory Appeal against this order has been admitted by the Supreme Court.
The Commissioner of Central Excise, Nasik passed another order dated 20th March, 2006 confirming a demand of Rs. 24.75 crores in respect of
Company’s Armada range of vehicles manufactured during the years 1992-1996, on the same grounds as adopted for Commander range of
vehicles.
The Company has been legally advised that the aforesaid orders dated 30th March, 2005 and 20th March, 2006 passed by the Commissioners are
unsustainable in law. The Tribunal has also given an unconditional stay against both the aforesaid orders.

The final hearing in the above matters is awaited.

The Company is confident that it would succeed in the case and the Company’s stand that the Commander and Armada Vehicles are 10-seater
vehicles would be upheld. As such, the Company does not expect any liability on this account.
20. Contingent Liability :
(a) Guarantees given by the Company :

Rupees crores

Amount of guarantees Outstanding amounts

against the guarantees

2009 2008 2009 2008

For employees 1.05 1.05 * *

For other companies 168.46 38.10 163.67 34.37

(b) Claims against the Company not acknowledged as debts comprise of :

(i) Excise Duty, Sales Tax and Service Tax claims disputed by the Company relating to issues of applicability and classification aggregating
Rs. 381.39 crores (Net of Tax : Rs. 270.95 crores) [2008 : Rs. 184.03 crores (Net of Tax : Rs. 127.24 crores)].

(ii) Other matters (excluding claims where amounts are not ascertainable) : Rs. 21.95 crores (Net of Tax : Rs. 15.16 crores ) [2008 :
Rs. 10.73 crores (Net of Tax : Rs. 7.61 crores)].

(iii) Claims on capital account : Rs. 1.18 crores (2008 : Rs. 1.18 crores).

(c) Uncalled liability on equity shares partly paid Rs. 10.50 crores (2008 : Rs. 10.50 crores).

(d) Taxation matters :

(i) Demands against the Company not acknowledged as debts and not provided for, relating to issues of deductibility and taxability in
respect of which the Company is in appeal and exclusive of the effect of similar matters in respect of assessments remaining to be
completed :

- Income-Tax : Rs. 168.25 crores (2008 : Rs. 134.14 crores).

(ii) Items in respect of which the Company has succeeded in appeal, but the Income-tax Department is pursuing/likely to pursue in
appeal/reference and exclusive of the effect of similar matters in respect of assessments remaining to be completed :

- Income-Tax matters : Rs. 58.63 crores (2008 : Rs. 37.96 crores)

- Surtax matters : Rs. 0.13 crores (2008 : Rs. 0.13 crores)

(e) Bills discounted not matured Rs. 59.55 crores (2008 : Rs. 61.22 crores).

(f) Counter Guarantees to banks Rs. 0.64 crores (2008 : Nil).

21. Research and Development expenditure :

(a) In recognised Research and Development units :

(i) debited to the Profit and Loss Account, including certain expenditure based on allocations made by the Company, aggregate
Rs. 220.09 crores (2008 : Rs. 177.89 crores) [excluding depreciation and amortisation of Rs. 56.19 crores (2008 : Rs. 39.21 crores)].

(ii) Development Expenditure incurred during the year Rs. 128.94 crores (2008 : Rs. 53.77 crores).

(iii) Capitalisation of assets Rs. 15.64 crores (2008 : Rs. 33.13 crores).

* denotes amounts less than Rs. 50,000

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 (b) In other units :
(i) debited to the Profit and Loss Account, including certain expenditure based on allocations made by the Company, aggregate
Rs. 18.69 crores (2008 : Rs. 13.63 crores) [excluding depreciation and amortisation of Rs. 1.50 crores (2008 : Rs. 1.09 crores)].
(ii) Development Expenditure incurred during the year Rs. 7.50 crores (2008 : Rs. Nil).
(iii) Capitalisation of assets Rs. 3.56 crores (2008 : Rs. 1.55 crores).
22. The net difference in foreign exchange loss debited to the Profit and Loss Account is Rs. 237.20 crores (2008 : Gain of Rs. 13.45 crores).
23. Exceptional items of Rs. 10.27 crores (2008 : Rs. 172.73 crores) comprise of :
(a) Surplus on transfer of Logistics business Rs. 10.27 crores (2008 : Rs. Nil).
(b) In the previous year, gain of Rs. 172.73 crores arising from the schemes of arrangement (merger) between the Company’s subsidiaries Mahindra
Stokes Holding Company Limited (MSHCL), Mahindra Forgings Overseas Limited (MFOL) and Mahindra Forgings Mauritius Limited (MFML) with
Mahindra Forgings Limited (MFL); and between Plexion (India) Private Limited with Mahindra Engineering Design and Development Company
Limited (MEDDCL) approved by the High Court of Bombay. The schemes are operative from the appointed date of 1 st April, 2007. Consequently
MFL became a subsidiary of the Company and MSHCL, MFOL, MFML and Plexion (India) Private Limited, ceased to be subsidiaries of the
Company. In compliance with Accounting Standard (AS) 13 - ’Accounting for investments’, the Company is required to value the additional
shares received of MFL and MEDDCL, by referencing them to the fair value of the shares of MSHCL, MFOL, MFML and Plexion (India) Private
Limited respectively, resulting in the gain mentioned above.

24. The components of Deferred Tax Liability and Assets as at 31st March, 2009 are as under :
Rupees crores
2009 2008

Deferred Tax Liability :

(i) On fiscal allowances on fixed assets 322.06 196.65
(ii) Others 71.32 21.11

393.38 217.76

Deferred Tax Assets :

(i) On Provision for Compensated absences 78.62 67.36
(ii) On Provision for Doubtful Debts/Advances 27.33 13.68
(iii) On Premium on redemption of Zero Coupon Convertible Bonds 40.08 48.67
(iv) On Provision for Employee Benefits 17.61 11.01
(v) Loss on mark to market of Forward Contracts 223.57 6.66
(vi) Others 24.44 13.66

411.65 161.04

Net Deferred Tax (Asset)/Liability (18.27) 56.72

25. Scheme of Amalgamations :

(a) Pursuant to the Scheme of Amalgamation (the scheme) of Mahindra Holdings and Finance Limited (MHFL) a wholly owned subsidiary of
the Company, with the Company as sanctioned by the Honourable High Court of Bombay vide its order dated 18th July, 2008, the entire
business and all the assets and liabilities, duties and obligations of MHFL were transferred to and vested in the Company, from 1st February,
2008 (the appointed date). The scheme became effective on 11th August, 2008.
The accounting for the amalgamation was done as per the pooling of interest method as modified under the scheme and approved by the
Honourable High Court and the same has been given effect to in the financial statements as under :
(i) The assets, liabilities and reserves of MHFL were recorded in the books of the Company, at their book values.
(ii) The Company transferred, out of its total holding in MHFL as on 1st February, 2008, 5,13,10,208 shares to a trust, to hold the shares
and any additions or accretions thereto exclusively for the benefit of the Company and the Company has under the scheme issued to
the trust one share in itself for every four shares held by it in MHFL. The balance shares held by the Company in MHFL were cancelled.
(iii) The Company credited to the existing Investment Fluctuation Reserve Account Rs. 129.61 crores, being the excess of the value of the
net assets of MHFL over the face value of the shares allotted, the face value of the shares cancelled and the amount of General Reserve
and Profit and Loss Account of MHFL transferred to the Company.
MHFL was engaged in the business of investing and financing.
The MHFL profit after tax of Rs. 30.73 crores for the period 1st February, 2008 to 31st March, 2008, has been recognised in the current
year and disclosed separately in the Profit and Loss Account.
Had the scheme not prescribed the above treatment, the General Reserve of the Company would have been higher by Rs. 129.61
crores and the Investment Fluctuation Reserve Account lower by the same amount.

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 MAHINDRA & MAHINDRA LIMITED

(b) Pursuant to the Scheme of Amalgamation (the scheme) of Punjab Tractors Limited (PTL) a subsidiary of the Company, with the Company
sanctioned by the Honourable High Court of Bombay and the Honourable High Court of Punjab & Haryana vide their orders dated 9th
January, 2009 and 16th January, 2009 respectively, the entire business and all the assets and liabilities, duties and obligations of PTL were
transferred to and vested in the Company, from 1st August, 2008 (the appointed date). The scheme became effective from 16th February, 2009.
The accounting for the amalgamation was done as per the pooling of interest method as modified under the scheme and approved by the
Honourable High Courts and the same has been given effect to in the financial statements as under :
(i) The assets, liabilities and reserves of PTL were recorded in the books of the Company, at their book values.
(ii) The Company transferred its entire holding of 3,92,70,165 shares as on 1st August, 2008 in PTL to a trust, to hold the shares and any
additions or accretions thereto exclusively for the benefit of the Company. The Company has under the scheme issued one equity
share of Rs. 10 each for every three equity shares of Rs. 10 each held in PTL to the shareholders of PTL.
(iii) The Company credited to the existing Investment Fluctuation Reserve Account Rs. 677.00 crores, being the excess of the value of the
net assets of PTL over the face value of the shares allotted.
PTL was engaged in the business of manufacture and sale of tractors and combine harvesters.
Had the scheme not prescribed the above treatment, the General Reserve and the Profit and Loss Account of the Company would
have been higher by Rs. 646.70 crores and Rs. 30.00 crores respectively, there would have been a Preference Share Redemption
Reserve of Rs. 0.30 crores and the Investment Fluctuation Reserve Account would have been lower by Rs. 677.00 crores.
(c) On account of the above mergers, the figures for current year are not strictly comparable with that of the previous year.
26. Earnings per Share :

2009 2008

Amount used as the numerator – Balance of profit (Rupees crores) ............................................... 867.51 1,103.37
(Gain)/Loss on difference in exchange on bonds (Rupees crores) .................................................... 17.29 (42.97)
Amount used as the numerator for diluted earnings per share (Rupees crores) ............................. 884.80 1,060.40
Weighted average number of equity shares used in computing basic earnings per share ............. 27,25,22,947 23,86,22,366
Effect of potential ordinary (equity) shares on conversion of bonds/debentures ............................ 2,22,19,413 1,67,57,276
Weighted average number of equity shares used in computing diluted earnings per share .......... 29,47,42,360 25,53,79,642
Basic Earnings per share (Rs.) (Face value of Rs. 10 per share) ........................................................ 31.83 46.24
Diluted Earnings per share (Rs.) ........................................................................................................ 30.02 41.52

27. Provision for doubtful debts and advances for the year comprises :
Rupees crores
2009 2008

Provision for doubtful debts and advances made during the year (Net)
(including Rs. 19.52 crores (2008 : Rs. Nil) pursuant to the schemes of arrangement/amalgamation
approved by the Hon’ble High Courts) ............................................................................................. 50.96 (23.59)
Less : Transfer from Investment Fluctuation Reserve pursuant to the above schemes of
arrangement/amalgamation .............................................................................................................. 19.52 —

Total .................................................................................................................................................. 31.44 (23.59)

28. Provision for diminution in the value of long term investments for the year comprises :
Rupees crores
2009 2008

Provision for diminution in value of investments, made during the year (Net) (including
provision of Rs. 154.38 crores (2008 : Rs. Nil) pursuant to the schemes of
arrangement/amalgamation approved by the Hon’ble High Courts) ............................................... 154.38 (5.40)
Less : Transfer from Investment Fluctuation Reserve pursuant to the above schemes of
arrangement/amalgamation .............................................................................................................. 154.38 —

Total .................................................................................................................................................. — (5.40)

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29. The outstanding derivative instruments as on 31st March, 2009 :
The Company takes forward contracts to hedge exposures arising out of trade payables in foreign currency. Such outstanding forward contracts
are booked for fixing exchange rates between cross currencies like JPY/US$. The amount of hedges is Rs. Nil (2008 : JPY 50.00 crores).
The Company has taken forward contracts to hedge exposures arising out of trade receivables part by forward contracts US$ 60.30 crores
(2008 : AUD 0.35 crores, EUR 1.00 crore and US$ 19.40 crores), part by Range Forwards US$ 10.20 crores (2008 : Nil) and partly US$ 33.20
crores (2008 : US$ 33.75 crores and EUR 1.20 crores) by a derivative structure in the form of ‘strips’.
The foreign currency exposures not hedged by derivative instrument or otherwise as on 31st March, 2009 are – Receivables of AUD 0.38 crores,
RMB 0.01 crores, SEK * crores and Payables of US$ 2.71 crores, EUR 0.03 crores, GBP * crores, CHF * crores, JPY 2.38 crores, ZAR * crores,
SAR 0.04 crores, SGD * crores, DKK * crores, NZD * crores (2008 : Receivables of JPY 4.25 crores, RMB * crores and Payables of AUD 0.04
crores, CHF * crores, EUR 0.61 crores, GBP 0.05 crores, SEK 0.06 crores, SGD 0.02 crores, US$ 7.84 crores, ZAR 0.12 crores).
The Company has outstanding borrowings of JPY 1,126.44 crores and US$ 9.45 crores (2008 : JPY 1,091.74 crores and US$ 11.45 crores) as
Foreign Currency Borrowings. The borrowing of JPY 450.24 crores (2008 : JPY 509.44 crores) has been completely hedged using cross currency
swap structure fixing the liability into a full fledged rupee liability. The borrowing of JPY 676.20 crores (2008 : JPY 582.30 crores) has been fixed
to a US$ liability using a cross currency swap structure. The borrowing of US$ 2.00 crores (2008 : US$ 2.00 crores) has been hedged using a
forward cover.
The Company had made an issue of US$ 20.00 crores in the form of Foreign Currency Convertible Bonds in April, 2006. Out of this issue, Bonds
of value US$ 18.95 crores (2008 : US$ 20.00 crores) are outstanding and have not been hedged.
* denotes amounts less than 50,000 of respective currency.
30. Related Party Transactions :
(a) Related parties where control exist :
(i) Subsidiaries :
Sl. No. Name of the Company Sl. No. Name of the Company
1. Mahindra Engineering and Chemical Products Limited 30. Tech Mahindra (R&D Services) Inc. (upto 30th June, 2008)
2. Mahindra Logisoft Business Solutions Limited 31. Bristlecone Limited
3. Mahindra First Choice Wheels Limited (formerly known as 32. Bristlecone Inc.
FirstChoice Wheels Limited) 33. Bristlecone UK Limited
4. Mahindra USA Inc. 34. Bristlecone India Limited
5. Mahindra Gujarat Tractor Limited 35. Bristlecone (Singapore) Pte. Limited
6. Mahindra (China) Tractor Company Limited 36. Bristlecone GmbH
7. Mahindra Shubhlabh Services Limited 37. Mahindra Renault Private Limited
8. Mahindra & Mahindra South Africa (Proprietary) Limited 38. Mahindra Navistar Automotives Limited (formerly known
9. Mahindra Europe s.r.l. as Mahindra International Limited)
10. Mahindra Engineering Services Limited (formerly known as 39. Stokes Group Limited
Mahindra Engineering Design & Development Company 40. Jensand Limited
Limited)
41. Stokes Forgings Limited
11. Mahindra SAR Transmission Private Limited
42. Stokes Forgings Dudley Limited
12. Mahindra Overseas Investment Company (Mauritius) Limited
43. Mahindra Engineering Services (Europe) Limited (formerly
13. Mahindra-BT Investment Company (Mauritius) Limited known as Plexion Technologies (UK) Limited)
14. Mahindra Intertrade Limited 44. Plexion Technologies GmbH
15. Mahindra Steel Service Centre Limited 45. Mahindra Technologies Inc. (formerly known as Plexion
16. Mahindra Middleeast Electrical Steel Service Centre (FZC) Technologies Inc.)
17. Mahindra Consulting Engineers Limited 46. Mahindra Lifespace Developers Limited
18. Mahindra Holidays & Resorts India Limited 47. Mahindra World City (Jaipur) Limited
19. Mahindra Holidays and Resorts USA Inc. 48. Mahindra World City Developers Limited
20. NBS International Limited 49. Mahindra Infrastructure Developers Limited
21. Mahindra Ugine Steel Company Limited 50. Mahindra Integrated Township Limited
22. Mahindra & Mahindra Financial Services Limited 51. Mahindra World City (Maharashtra) Limited
23. Mahindra Insurance Brokers Limited 52. PT Tech Mahindra Indonesia
24. Tech Mahindra Limited 53. Mahindra Forgings International Limited
25. Tech Mahindra (Americas) Inc. 54. CanvasM Technologies Limited
26. Tech Mahindra GmbH 55. CanvasM (Americas) Inc.
27. Tech Mahindra (Singapore) Pte. Limited 56. Mahindra Forgings Europe AG
28. Tech Mahindra (Thailand) Limited 57. Gesenkschmiede Schneider GmbH
29. Tech Mahindra Foundation 58. JECO-Jellinghaus GmbH

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 MAHINDRA & MAHINDRA LIMITED

Sl. No. Name of the Company Sl. No. Name of the Company
59. Falkenroth Umformtechnik GmbH 80. Mahindra Aerospace Private Limited
60. Mahindra Vehicle Manufacturers Limited (formerly known 81. Heritage Bird (M) SDN.BHD
as Mahindra Automotive Limited) 82. Mahindra First Choice Services Limited
61. Schöneweiss & Co. GmbH 83. Mahindra Bebanco Developers Limited (w.e.f. 3rd June, 2008)
84. Mahindra Gears Global Limited (formerly known as Iven
62. Mahindra Hinoday Industries Limited
International Gear Mauritius Limited) (w.e.f. 6th June, 2008)
63. MHR Hotel Management GmbH 85. Mahindra Gears Cyprus Limited (formerly known as
64. Mahindra Forgings Limited Kalbarri Trading Limited) (w.e.f. 6th June, 2008)
65. Mahindra Rural Housing Finance Limited 86. Mahindra Gears International Limited (w.e.f. 10th June, 2008)
66. Mahindra Hotels and Residences India Limited 87. Mahindra Metal Castello S.r.l. (w.e.f. 17th June, 2008)
67. Mahindra Forgings Global Limited 88. Mahindra Industrial Township Limited (w.e.f. 2nd July, 2008)
89. Metalcastello S.p.A (w.e.f. 3rd July, 2008)
68. Bristlecone (Malaysia) SDN.BHD
90. Crest Geartech Private Limited (w.e.f. 3rd July, 2008)
69. Tech Mahindra (Malaysia) SDN.BHD 91. Engines Engineering S.r.l (w.e.f. 5th Aug, 2008)
70. Punjab Tractors Limited (upto 31st July, 2008) 92. Eff Engineering S.r.l (w.e.f. 5th Aug, 2008)
71. Mahindra Castings Private Limited 93. ID-EE S.r.l (w.e.f. 5th Aug, 2008)
72. Mahindra Retail Private Limited (upto 14th January, 2009) 94. Mahindra IT Consulting Private Limited (w.e.f. 16th Sept, 2008)
73. Mahindra Knowledge City Limited 95. Mahindra Automotive Australia Pty. Limited (w.e.f. 23rd Sept, 2008)
(formerly known as Mahindra Technology Park Limited) 96. Mahindra Two Wheelers Limited (w.e.f. 29th Sept, 2008)
97. Mahindra United Football Club Private Limited
74. Mahindra Holdings Limited
(w.e.f. 3rd Nov, 2008)
75. Mahindra Logistics Limited 98. Mahindra Defence Land Systems Private Limited
76. Tech Mahindra (Beijing) IT Services Limited (w.e.f. 4th March, 2009)
77. Mahindra Navistar Engines Private Limited 99. Mahindra Yeuda (Yancheng) Tractor Company Limited
78. Mahindra Residential Developers Limited (w.e.f. 28th November, 2008)
79. Mahindra Graphic Research Design s.r.l. 100. Venturbay Consultants Private Limited (w.e.f. 19th March, 2009)

(b) Other parties with whom transactions have taken place during the year.
(i) Associates :
Sl. No. Name of the Company Sl. No. Name of the Company
1. Mahindra Composites Limited 4. Mahindra Water Utilities Limited
2. Mahindra Construction Company Limited 5. Swaraj Automotives Limited
3. Owens Cornings (India) Limited 6. Swaraj Engines Limited

(ii) Joint Venture :

Sl. No. Name of the Company
1. Mahindra Sona Limited

(iii) Key Management Personnel :

Vice Chairman and Managing Director ................................... Mr. Anand Mahindra
Executive Directors ................................................................... Mr. B.N. Doshi
Mr. A.K. Nanda

(iv) Welfare Funds :

Sl. No. Name of the Fund

1. Mahindra World School Education Trust
2. M&M Benefit Trust
3. M&M Employee’s Welfare Fund
4. M&M Employee’s Farm Equipment Sector Employee’s Welfare Fund

113
 (c) The related party transactions are as under :
Rupees crores
Sl. No. Nature of Transactions Subsidiaries Associate Joint Key Management Welfare
Companies Ventures Personnel Funds
1. Purchases :
Goods .............................................................. 6,58.26 1,58.49 66.72 — —
(4,41.75) (1.59) (50.51) (—) (—)
Fixed Assets ..................................................... 7.41 — — — —
(9.73) (0.33) (—) (—) (—)
Services ............................................................ 3,34.45 — — — —
(85.67) (—) (—) (—) (—)
2. Sales :
Goods .............................................................. 4,09.72 1.22 — — —
(5,67.07) (—) (—) (—) (—)
Fixed Assets ..................................................... 8.19 0.16 — — —
(0.77) (—) (—) (—) (—)
Services ............................................................ 1,25.00 4.96 0.05 — —
(1,86.25) (0.02) (0.04) (—) (—)
3. Investments :
Purchase/Subscribed ........................................ 10,04.39 — — — 0.01
(10,67.46) (3.00) (—) (—) (—)
Sales/Redemption ............................................ 28.75 — — — —
(6,15.02) (—) (—) (—) (—)
4. Deputation of Personnel :
From Related Parties ........................................ 1.59 — — — —
(1.19) (—) (—) (—) (—)
To Related Parties ............................................ 17.35 0.52 — — —
(11.21) (0.39) (—) (—) (—)
5. Managerial Remuneration ............................... — — — 5.15 —
(—) (—) (—) (5.39) (—)
6. Stock Options .................................................. — — — 0.07 —
(—) (—) (—) (0.05) (—)
7. Finance :
Inter Corporate Deposits given ........................ 6,19.59 — — — —
(56.17) (—) (—) (—) (—)
Inter Corporate Deposits refunded by parties . 2,99.61 — — — —
(8.16) (—) (—) (—) (—)
Inter Corporate Deposits taken ....................... 5.00 — — — —
(25.00) (—) (—) (—) (—)
Inter Corporate Deposits refunded to parties . 5.00 — — — —
(25.00) (—) (—) (—) (—)
Interest received .............................................. 24.19 1.85 — — —
(9.59) (—) (—) (—) (—)
Interest paid .................................................... 1.47 — — — —
(1.32) (—) (—) (—) (—)
Dividend received ............................................ 1,31.83 0.28 0.98 — —
(65.24) (—) (—) (—) (—)
Security Deposits accepted .............................. — — — — —
(0.57) (—) (—) (—) (—)

114
 MAHINDRA & MAHINDRA LIMITED

Rupees crores
Sl. No. Nature of Transactions Subsidiaries Associate Joint Key Management Welfare
Companies Ventures Personnel Funds
Security Deposits paid ..................................... 0.05 — — — —
(3.00) (—) (—) (—) (—)
8. Share Application Money (Net) ....................... — — — — —
(9.33) (—) (—) (—) (—)
9. Issue of Ordinary (Equity) Shares .................... — — — — 14,59.76
(—) (—) (—) (—) (—)
10. Dividends Distributed ...................................... — — — 0.52 1.05
(—) (—) (—) (0.17) (0.37)
11. Guarantees & Collaterals given ....................... 1,19.58 — — — —
(—) (—) (—) (—) (—)
12. Other Transactions :
Other Income .................................................. 10.88 0.28 — — —
(6.80) (—) (0.02) (—) (—)
Other Expenses ................................................ 17.71 — — — —
(8.21) (—) (—) (—) (—)
Reimbursements received from parties ........... 2,01.55 0.02 0.03 — —
(3,15.68) (0.02) (0.06) (—) (—)
Reimbursements made to parties .................... 1,29.43 0.02 — — —
(1,74.37) (—) (—) (—) (—)
Advance given ................................................. 5.74 — — — 15.00
(4.84) (—) (—) (—) (—)
Advance refunded ........................................... — — — — —
(2,36.55) (—) (—) (—) (—)
13. Outstandings :
Payable ............................................................ 1,24.62 3.26 11.20 2.21 —
(70.70) (0.65) (8.97) (2.46) (—)
Receivable ........................................................ 1,41.23 12.31 0.01 — 15.00
(1,80.37) (3.09) (0.02) (—) (—)
Debenture issued by parties ............................ 45.00 — — — —
(30.00) (—) (—) (—) (—)
Inter Corporate Deposits given ........................ 4,00.78 4.59 — — —
(64.95) (4.59) (—) (—) (—)
Guarantees & Collaterals given ....................... 1,63.67 — — — —
(34.37) (—) (—) (—) (—)
Security Deposit paid ....................................... 0.05 — — — —
(3.00) (—) (—) (—) (—)
14. Provision for doubtful debts/advances ............ 25.51 6.69 — — —
(5.99) (6.69) (—) (—) (—)
15. Share Application Money. ............................... — — — — —
(9.33) (—) (—) (—) (—)

Previous year’s figures are given in brackets.

The previous year’s figures are suitably regrouped/restated.

115
The significant related party transactions are as under :
Rupees crores
Sl. Associate
No. Nature of Transactions Subsidiaries Amount Companies Amount Joint Ventures Amount
1. Purchase – Goods Mahindra Intertrade 1,24.93 Swaraj Engines 1,50.60 Mahindra Sona 66.72
Limited (2,32.20) Limited (—) Limited (50.51)
Mahindra Ugine 3,08.92 Mahindra Composites —
Steel Company Limited (—) Limited (1.58)
Mahindra Hinoday —
Industries Limited (46.98)
Mahindra Forgings 77.32
Limited (60.36)
2. Purchase – Services Mahindra Engineering 44.05
Services Limited (20.72)
Mahindra Logistics 2,37.42
Limited (—)
3. Sale – Goods Mahindra USA 1,05.37 Swaraj Engines 1.22
Inc. (1,78.05) Limited (—)
Mahindra Navistar 92.61
Automotives Limited (98.30)
Mahindra & Mahindra 58.22
South Africa (1,00.99)
(Proprietary) Limited
Mahindra Europe s.r.l. —
(1,15.65)
NBS International 64.89
Limited (—)
4. Sale – Services Mahindra Navistar 34.37 Swaraj Automotives — Mahindra Sona 0.05
Automotives Limited (47.76) Limited (*) Limited (0.04)
Mahindra Renault 76.27 Swaraj Engines 1.43
Private Limited (1,14.37) Limited (0.01)
Owens Corning 3.21
(India) Limited (—)
5. Investments – Purchase Mahindra Navistar 1,12.97 Mahindra Renault —
Automotives Limited (—) Nissan Automotive (3.00)
Private Limited
Mahindra Vehicle 3,60.20
Manufacturers Limited (1,24.75)
Mahindra Overseas 1,09.43
Investment Company (—)
(Mauritius) Limited
Mahindra Gears 1,53.14
International Limited (—)
Mahindra Two 1,17.99
Wheelers Limited (—)
Mahindra Forgings —
Limited (6,88.61)
6. Investments – Sale Mahindra Forgings —
Limited (4,68.54)
Mahindra Castings —
Private Limited (1,05.20)

* denotes amounts less than Rs. 50,000

116
 MAHINDRA & MAHINDRA LIMITED

Rupees crores
Sl. Associate
No. Nature of Transactions Subsidiaries Amount Companies Amount Joint Ventures Amount

7. Investments – Mahindra & Mahindra 10.00

Redemption Financial Services Limited (4.00)

Mahindra Intertrade 18.75

Limited (—)

8. Share Application Mahindra Vehicle —

Money (Net) Manufacturers Limited (5.50)
Mahindra Navistar —
Engines Private Limited (3.83)
9. Advances given Mahindra Ugine Steel 2.13
Company Limited (4.09)
Mahindra Automotive 3.57
Australia Pty. Limited (—)

Mahindra Renault —
Private Limited (0.75)

10. Inter Corporate Mahindra & Mahindra 1,85.00

Deposits given Financial Services Limited (—)
Mahindra Vehicle 1,00.00
Manufacturers Limited (—)
Mahindra Two 1,02.00
Wheelers Limited (—)
Bristlecone Limited —
(40.82)

Mahindar Shubhlabh —
Services Limited (8.25)

11. Inter Corporate Deposits Mahindra Engineering 40.00

refunded by parties Services Limited (—)
Mahindra & Mahindra 1,70.00
Financial Services Limited (—)
Mahindra Two Wheelers 67.00
Limited (—)
Mahindra Intertrade —
Limited (1.56)

Mahindra Ashtech —
Limited (6.50)

12. Guarantees given Mahindra Renault 1,19.58

Private Limited (—)

31. Joint Venture Disclosure

(i) Jointly Controlled Entities by the Company :

Name of the Entity Country of

Incorporation % Holding

(a) Mahindra Sona Limited India 29.77 %

(b) PSL Erickson Limited India 18.06 %

117
 (ii) Interests in the Assets, Liabilities, Income and Expenses with respect to Jointly Controlled Entities.
Rupees crores

2009 2008

I ASSETS

1. Fixed Assets ............................................................................................. 8.03 6.54

2. Investments .............................................................................................. 0.05 0.05

3. Current Assets, Loans and Advances

a. Inventories ....................................................................................... 4.59 5.97

b. Sundry Debtors ................................................................................ 10.22 11.21

c. Cash and Bank Balances .................................................................. 3.40 2.06

d. Loans and Advances ........................................................................ 1.23 1.30

4. Deferred Tax – Net ................................................................................... 0.25 0.32

II LIABILITIES

1. Loan Funds

a. Secured Loans ................................................................................. 0.82 1.88

2. Current Liabilities and Provisions

a. Liabilities .......................................................................................... 6.14 8.07

b. Provisions ......................................................................................... 1.62 1.96

III INCOME

1. Sales ........................................................................................................ 44.57 46.95

2. Other Income .......................................................................................... 2.21 1.60

IV EXPENSES

1. Raw Materials, Finished and Semi Finished Products .............................. 26.73 27.30

2. Excise Duties ............................................................................................ 4.09 5.00

3. Manufacturing, Selling Expenses, etc ...................................................... 9.34 10.51

4. Depreciation/Amortisation ....................................................................... 0.76 0.60

5. Provision for Taxation .............................................................................. 2.20 1.88

V OTHER MATTERS

1. Contingent Liabilities ............................................................................... 3.90 3.53

2. Capital Commitments .............................................................................. 0.29 0.60

32. Additional information pursuant to the provisions of paragraphs 3(i)(a) and (ii), 4C and 4D of Part II of Schedule VI to the Companies Act,
1956 - See Schedule XVI. Previous year’s figures are indicated below the current year’s figures.

33. Additional information pursuant to the provisions of Part IV of Schedule VI to the Companies Act, 1956 - See Schedule XVII.

34. Previous year’s figures have been regrouped/restated wherever necessary.

118
 MAHINDRA & MAHINDRA LIMITED

SCHEDULE XV
Computation of Net Profit in accordance with Section 309(5) of the Companies Act, 1956 for the year ended 31st March, 2009
Rupees crores

2009 2008

Profit before Taxation as per Profit and Loss Account ..................................................... 1,036.47 1,406.77
Add : Profit of the Mahindra Holdings and Finance Limited for the period
1st February, 2008 to 31st March, 2008 ............................................................. 41.74 —
: Depreciation/Amortisation charged in the Accounts ......................................... 291.51 238.66
: Directors’ Remuneration including Directors’ fees ............................................. 6.29 6.54
: Provision for doubtful debts and advances (Net) .............................................. 31.44 (23.59)
: Loss on sale, etc. of Fixed Assets (Net) .............................................................. 1.19 2.82
: Net reduction in the fair value of current investments ...................................... (1.57) (1.74)
: Provision for diminution in value of long term investments (Net) ..................... — (5.40)
370.60 217.29
1,407.07 1,624.06
Less : Depreciation under Section 350 of the Companies Act, 1956 .......................... 233.97 192.01
: Amortisation of Intangibles ................................................................................ 31.14 19.37
: Profit on sale of Investments (Net) ..................................................................... 53.22 28.94
: Profit arising on merger between company’s subsidiaries (Refer Note 23(b)) ... — 172.73
: Loss on sale of Assets as per Section 349 of the Companies Act, 1956 (Net) . 2.22 1.71
: Surplus on transfer of Logistics Division ............................................................ 10.27 —
330.82 414.76
Total .................................................................................................................... 1,076.25 1,209.30

Commission payable to the wholetime Directors restricted to ............................. 2.20 2.45

Commission payable to the non-wholetime Directors restricted to ..................... 0.96 0.96

119
SCHEDULE XVI
Additional Information pursuant to the Provisions of Paragraphs 3 (i)(a) and (ii), 4C and 4D, of Part II of Schedule VI to the Companies Act, 1956.
(A) PARTICULARS IN RESPECT OF GOODS MANUFACTURED :

Sl. Class of Goods Unit of Licenced Installed Actual

No. Measurement Capacity Capacity Production
per annum per annum [Notes (ii)
[Note (i)] [Note (i)] & (iii)(a)]

1. a. On Road Automobiles having four or

more wheels such as light, medium and
heavy commercial vehicles, jeep type
vehicles and passenger cars covered
under sub heading (5) of Heading (7)
of First Schedule Nos. 2,76,000 2,50,000 1,58,715
2,76,000 2,29,000 1,62,400
b. Three Wheelers Nos. 1,11,000 72,000 43,278
1,11,000 54,000 34,556
2. a. Agricultural Tractors [Note (v) below] Nos. 2,14,000 2,33,000 1,17,847
1,89,000 1,73,000 95,301
b. Tractor Skids These are
manufactured
against spare
capacity under 2(a) 1,251
3,616
3. Manufactured and Purchased Parts Nos. These are
and Accessories for sale [Notes (iii)(a) manufactured
and (b) below] against spare
capacity under
1 and 2 above 4,27,952
2,42,709
4. Internal Combustion Piston Engines Nos. 1,75,000 1,50,000 1,18,036
1,75,000 1,36,000 1,29,236
5. Agricultural Implements Nos. 17
—
6. Parts and accessories of motor vehicles Nos. 5,00,000 1,25,000 94,637
5,00,000 1,25,000 80,967
7. Internal Combustion Engine Nos. 60,000 54,000 50,913
60,000 54,000 47,597
8. Diesel Genset Nos. 24,000 Assembly at 26,227
rd
24,000 3 Party Locations 16,943
9. Engines Nos. These are 25,904
manufactured 15,129
against spare
capacity under 2(a)
10. Forklifts Nos. 300 300 46
— — —
11. Harvester Combines Nos. 300 300 136
— — —
12. Castings MT. 2,000 10,000 6,857
— — —
13. Circuit Breakers Nos. 5,321
1,847
14. Export benefits

# Includes Stock taken over on amalgamation with PTL (Quantity : 2,385 Nos., Value : Rs. 66.90 crores).
@ Includes Stock taken over on amalgamation with PTL (Value : Rs.12.93 crores).
^ Stock taken over on amalgamation with PTL
* denotes amount less than Rs. 50,000
Notes :
(i) (a) The installed capacity has been certified by Presidents, which the auditors have relied on without verification as this is a technical matter.
(b) The licensed capacities include/represent, as the case may be, registrations granted and Industrial Entrepreneur Memorandum filed with,
and duly acknowledged by, the Government pursuant to the schemes of de-licensing. [Also see note (v) below].
(c) Within the overall licensed capacity in item 1 above, the Company is permitted to manufacture for outside sale 10,000 petrol/diesel engines
and 4,000 tonnes grey iron castings.
(d) Bullet proof work and fabrication on base vehicles has been carried out at third party facilities. 110 (2008 : 38) Vehicles were produced and
sold using such third party facilities and are included in item (A) 1(a).
(e) The installed capacity mentioned against item no. (A) 1(a) above includes 48,000 (2008 : 48,000) for production of vehicles for third
parties.

120
 MAHINDRA & MAHINDRA LIMITED

SCHEDULE XVI (Contd.)

Opening Stock Closing Stock Sales

Quantity Value Quantity Value Quantity Value
Rupees crores Rupees crores Rupees crores

5,826 256.52 2,923 107.59 1,61,189 7,646.72

4,473 179.74 5,826 256.52 1,60,636 7,407.00
2,753 29.28 1,219 14.41 44,806 517.68
2,312 26.63 2,753 29.28 34,076 398.98
9,438# 254.16 # 8,671 232.77 1,18,565 4,333.56
7,163 164.73 7,053 187.26 95,370 3,133.96

168 6.61 23 1.66 1,386 65.35

119 4.22 168 6.61 3,546 133.55

— 94.94@ — 91.50 — 620.26

— 62.97 — 82.01 — 576.86
1,162 8.15 1,361 10.08 9,034 89.25
917 2.92 1,162 8.15 13,836 125.85
2^ 0.01^ 5 0.02 14 0.06
— — — — — —
12 0.02 7 0.01 517 0.76
70 0.03 12 0.02 1,519 2.02
107 — 97 — — —
90 — 107 — — —
115 2.04 159 2.96 26,183 592.15
97 1.23 115 2.04 16,925 367.08
439 2.79 385 2.17 25,958 248.41
226 1.24 439 2.79 14,916 140.14

7^ 0.51^ 6 0.41 46 3.52

— — — — — —
2^ 0.25^ 1 0.11 137 16.47
— — — — — —
1^ 0.01^ 1 0.01 117 0.63
— — — — — —
4 * 164 0.02 5,161 3.79
— — 4 * 1,843 2.92
26.99
28.64
Total....... 14,165.60
12,317.00

(ii) Actual Production includes production for captive consumption.

(iii) (a) The actual production disclosed against manufactured components/sub-assemblies/steel blanks is the number of such components transferred
during the year to the Marketing Unit/Spare Parts Stores for sale or sold otherwise.
(b) The Opening and Closing Stocks and Sales of goods shown under item 3 above consist of manufactured and purchased parts. The
bifurcation of stocks/sales into manufactured and bought-out parts is not practicable.
(iv) With regard to clause 3(ii) of Part II of Schedule VI to the Companies Act, 1956, the Company is of the view that, in respect of the property
development activity, the Company is not a ‘manufacturing’, a ‘trading’ or a ‘service’ company falling under sub-clause (a), (b) and (c) thereof,
but it is an ‘other’ company falling under sub-clause (e) thereof.
(v) Licenced capacity in respect of Agricultural Tractor includes a Letter of Intent from the Government of India for expansion of the manufacturing
capacity from 25,000 to 60,000 tractors at Mumbai subject to fulfillment of conditions mentioned therein; an Industrial Licence will be issued
on fulfillment of the conditions mentioned in the Letter of Intent.

121
SCHEDULE XVI (Contd.)
(B) PARTICULARS IN RESPECT OF GOODS TRADED :

Purchases Opening Stock Closing Stock Sales

Sl. Unit of
No. Class of Goods Measurement Quantity Value Quantity Value Quantity Value Quantity Value

Rupees Rupees Rupees Rupees

crores crores crores crores
1. Tractors .............................................. Nos. 269 7.29 36 1.13 50 1.75 251 8.90
113 2.99 33 1.13 36 1.13 110 4.64
2. Agricultural Implements .................... Nos. 6,178 41.47 2,230 3.62 436 5.98 7,972 50.32
9,585 24.79 1,645 3.50 2,230 3.62 9,000 30.53
3. Light Commercial Vehicles ................ Nos. 693 27.41 — — — — 693 31.20
365 13.63 — — — — 365 16.07
4. Bought-out Spares for Resale
[Note (iii)(b) to item “A”] ................... 263.96 — — —
275.71 — — —
5. Diesel Genset ..................................... Nos. 3 0.16 — — 1 0.05 2 0.12
— — — — — — — —
6. Genset Engines ................................. Nos. 274 2.93 — — 67 0.29 207 3.04
81 0.17 — — — — 81 0.21
7. Others ............................................... 2.93 — 0.02 9.23
1.90 — — 2.58
Total ............... 346.15 4.75 8.09 102.81
319.19 4.63 4.75 54.03

Note (v) to item (A).

(C) PARTICULARS OF RAW MATERIALS AND COMPONENTS CONSUMED :

Sl. Unit of Value

No. Description Measurement Quantity Rupees crores

}
1. Steel Items (Sheets, Tubes, etc.) .................................................................................. Nos. 1,00,109
73,444
Sq.Feet — 192.71
62 206.56
Metric Tonnes 32,290
53,355

}
2. Aluminium Sections and Other Aluminium Items ...................................................... Metric Tonnes —
0.03 0.14
Kgs. 10,339 1.27
93,757

3. Other Metals (Steel Shots, Lead, Tin, etc.) ................................................................. Metric Tonnes 118.60 0.56

}
95.38 0.31

4. Paints ........................................................................................................................... Nos. 7,49,035

5,26,015
Metres 1,83,583
— 72.85
Kgs. 19,36,747 62.27
20,71,338
Litres 35,76,788
26,87,054

5. Steel Scrap .................................................................................................................. Metric Tonnes 11,508 26.94

6,026 11.87

122
 MAHINDRA & MAHINDRA LIMITED

SCHEDULE XVI (Contd.)

(C) PARTICULARS OF RAW MATERIALS AND COMPONENTS CONSUMED (Contd.) :
MATERIALS

Sl. Unit of Value

No. Description Measurement Quantity Rupees crores

6. Pig Iron ....................................................................................................................... Metric Tonnes 8,880 25.42

}
2,787 5.18

7. Miscellaneous Foundry Materials ................................................................................ Nos. 15,45,939

15,45,042

Metric Tonnes 12,585 16.32

9,400 7.89

Litres 3,36,844
3,07,209

8. Other Materials (Direct Stores, Patterns, Oils, etc.) ..................................................... Not practicable to give *78.19
quantitative details *61.67

9. Tyres and Tubes Nos. *27,31,682 *473.90

*24,69,329 *393.28

10. Components other than Tyres and Tubes (including processing charges) .................. *7,584.26
*6,488.63

11. Material handling and transportation charges, etc. incurred

on the above items not separately allocable .............................................................. 300.50
316.90
Total..... 8,771.79
7,555.83

* Includes items used for other than production, amounts not ascertained.

Notes :

(i) The consumption in value has been ascertained on the basis of opening stock plus purchases less closing stock and includes the adjustment of
excesses and shortages as ascertained on physical count and write-off of obsolete and unserviceable raw materials and components.
(ii) The consumption in value shown against item 10 is a balancing figure based on the total consumption shown in the Profit and Loss Account.

(D) VALUE OF IMPORTS ON C.I.F. BASIS ACCOUNTED FOR DURING THE YEAR :
Rupees crores
2009 2008
1. Raw Materials ..................................................................................................... 0.65 4.63
2. Components, Spare Parts, etc. ............................................................................ 153.81 121.11
3. Capital Goods ..................................................................................................... 80.96 144.70
4. Items imported for Resale ................................................................................... 13.77 8.57
Total….. 249.19 279.01

Notes :
(i) Credits, if any, recoverable in respect of short landings, etc. are not considered.
(ii) The value of imports shown above includes :
(a) Imports on C&F basis as per suppliers’ invoices Rs. 4.43 crores (2008 : Rs. 2.91 crores)
(b) Imports on ‘cost’ basis Rs. 163.38 crores (2008 : Rs. 184.17 crores)

123
SCHEDULE XVI (Contd.)

(E) EXPENDITURE IN FOREIGN CURRENCIES (SUBJECT TO DEDUCTION OF TAX WHERE APPLICABLE) :

Rupees crores
2009 2008
1. Professional and Consultancy Fees [including Rs. 6.17 crores
(2008 : Rs. 2.30 crores) capitalised] ................................................................... 43.86 26.24
2. Commission on Exports ...................................................................................... 0.84 22.76
3. Royalty ................................................................................................................ — 0.06
4. Interest ................................................................................................................ 44.29 46.65
5. Others ................................................................................................................. 69.81 57.71
Total..... 158.80 153.42

Notes :
(1) Fee for use of technology, development expenditure and software expenditure [refer to in Note 1(B)] :
(a) written off during the year Rs. 8.91 crores (2008 : Rs. 9.05 crores); and
(b) amount remitted during the year Rs. 59.81 crores (2008 : Rs. 29.91 crores) net of tax deducted at source
Rs. 6.11 crores (2008 : Rs. 1.33 crores) are not included in the above figures.

(F) REMITTANCE IN FOREIGN CURRENCY ON ACCOUNT OF DIVIDENDS TO NON-RESIDENT SHAREHOLDERS :

Number of Amount remitted Dividend relating to

Shareholders Equity shares

Rupees crores

2009 : 1 120 * Year ended 31st March, 2008

2008 : 4 1,318 * Year ended 31st March, 2007

(G) EARNINGS IN FOREIGN EXCHANGE :

Rupees crores
2009 2008
1. Export of goods on F.O.B. basis ......................................................................... 632.36 795.38
2. Interest…………………………………………………………………………………….. 14.74 38.90
3. Others (freight, etc.) ........................................................................................... 44.15 49.28

Total..... 691.25 883.56

Notes :
F.O.B. value of exports includes local sales which qualify for export benefits and for which payment is receivable in foreign currency and local/export
sales under rupee credit which qualify for export benefits.
(H) VALUE OF IMPORTED AND INDIGENOUS CONSUMPTION :
^Raw Materials and Components
Rupees crores %
1. Imported ............................................................................................................. 121.97 1.39
120.88 1.60
2. Indigenously obtained ........................................................................................ 8,649.82 98.61
7,434.95 98.40
Total..... 8,771.79 100.00
7,555.83 100.00
^ Includes items used for other than production, amount not ascertained.
Notes :
(1) Items purchased through canalising agencies have been considered as imported.
(2) See Note (i) to item (C).
(3) In giving the above information the Company has taken the view that spares and components as referred to in paragraph 4 (D)(c) of Part II of
Schedule VI covers only such items as go directly into production.
* denotes amounts less than Rs. 50,000

124
 MAHINDRA & MAHINDRA LIMITED

SCHEDULE XVII
ADDITIONAL INFORMATION PURSUANT TO THE PROVISIONS OF PART IV OF SCHEDULE VI TO THE COMPANIES ACT, 1956.
Balance Sheet Abstract & Company’s General Business Profile :
I. Registration Details :
Registration No. 4 5 5 8 State Code 1 1
Balance Sheet Date 3 1 0 3 2 0 0 9
Date Month Year

II. Capital raised during the Year (Amount in Rs. Thousands) :

Public Issue Rights Issue

N I L N I L
Bonus Issue Private Placement
N I L N I L
III. Position of Mobilisation and Deployment of Funds (Amount in Rs. Thousands) :
Total Liabilities including Shareholders’ Funds Total Assets
1 4 5 0 5 9 8 6 0 1 4 5 0 5 9 8 6 0

Sources of Funds :
Paid-up Capital Reserves & Surplus

2 7 2 6 1 6 0 4 9 8 9 4 6 7 1
Secured Loans Unsecured Loans
9 8 0 9 9 8 2 3 0 7 1 7 6 3 5

Deferred Tax Liability (Net)

-
Application of Funds :
Net Fixed Assets Foreign Currency Monetary Item Translation Difference Account
3 2 1 4 3 3 0 5 1 8 1 0 7 5

Investments Deferred Tax Asset (Net)

5 7 8 6 4 1 3 5 1 8 2 6 7 9
Miscellaneous Expenditure Net Current Assets
1 2 5 4 9 9 2 6 5 1 7 5 5
IV. Performance of Company (Amount in Rs. Thousands) :
Turnover (Sales & Other Income)e Total Expenditure

1 5 1 2 4 2 3 8 1 1 4 0 4 6 0 3 2 4

+ - Profit/Loss Before Tax ì + - Profit/Loss After Tax ì

 1 0 7 8 2 0 5 7  8 6 7 5 1 0 7

Earnings per Share in Rupees ë

Basic Diluted Dividend Rate %
31.83 30.02 1 0 0

(Refer Note 26)

125
SCHEDULE XVII (Contd.)

V. Generic Names of Three Principal Products/Services of Company (as per monetary terms) :
Item Code No. (ITC Code) 8 7 0 1
Product Description Tractors
Item Code No. (ITC Code) 8 7 0 2
Product Description Motor Vehicles for the transport of more than six persons, excluding the driver
Item Code No. (ITC Code) 8 7 0 3
Product Description Other motor vehicles principally designed for the transport of persons
e after considering interest income, exceptional items and profit before tax earned by Mahindra Holdings and Finance Limited
on behalf of the company for the period 1st February, 2008 to 31st March, 2008.
ì after considering profit earned by Mahindra Holdings and Finance Limited on behalf of the company for the period
1st February, 2008 to 31st March, 2008.
ë computed on the basis of, the weighted average number of shares outstanding during the year.

Signatures to Schedules I to XVII

}
M. M. Murugappan Keshub Mahindra Chairman
N. Vaghul
R. K. Kulkarni Anand G. Mahindra Vice Chairman & Managing Director
A. S. Ganguly Directors
A. P. Puri
N. B. Godrej
Bharat Doshi
A. K. Nanda } Executive Directors
A. K. Dasgupta
Narayan Shankar Company Secretary
Mumbai, 28th May, 2009

126
 MAHINDRA & MAHINDRA LIMITED

Statement pursuant to Section 212 of the Companies Act, 1956, relating to subsidiary companies
Number of The net aggregate of profits/(losses) of the
Shares in the Subsidiary Companies so far as they concern the members of
Subsidiary Mahindra & Mahindra Limited
Company held
by Mahindra & Mahindra For Current Financial Year For Previous Financial Years
Name of the Subsidiary Companies Limited at the Dealt with in Not dealt Dealt with in Not dealt
financial year the accounts with in the the accounts with in the
ending date of Mahindra & accounts of of Mahindra & accounts of
Mahindra Mahindra & Mahindra Mahindra &
Limited for Mahindra Limited for Mahindra
the year Limited for the year Limited for
Equity Extent ended 31st the year ended 31st the year
of March, 2009 ended 31st March, 2009 ended 31st
holding March, 2009 March, 2009
Nos. % Rupees crores Rupees crores Rupees crores Rupees crores
Mahindra Engineering and Chemical Products Limited 53,98,462 100.00% - 6.89 - 67.76
Mahindra Intertrade Limited .................................... 2,71,00,006 100.00% - 44.71 8.30 85.80
@ Mahindra Middleeast Electrical Steel Service
Centre (FZC) .............................................................. - 90.00% - 10.21 - 5.34
Mahindra Steel Service Centre Limited ................... 37,23,874 61.00% - 1.98 0.67 8.14
Mahindra Consulting Engineers Limited ................. 5,10,000 51.00% - 0.53 - 0.82
Mahindra Holidays and Resorts India Limited ........ 7,33,54,833 #93.64% - 78.10 12.79 106.12
+ MHR Hotel Management GmbH .......................... - #70.23% - * - (0.02)
+ Mahindra Holidays & Resorts USA Inc. ................ - #93.64% - (3.95) - 3.63
+ Mahindra Hotels and Residences India Limited ... - #93.64% - (0.01) - (0.01)
+ Heritage Bird (M) SDN.BHD ................................. - #93.64% - (0.10) - -
NBS International Limited ....................................... 50,490 100.00% - (0.23) - 0.87
Mahindra Ugine Steel Company Limited ................ 1,64,66,789 50.69% - (9.54) 4.94 93.95
Mahindra Holdings Limited .................................... 2,25,49,999 100.00% - (1.13) - 0.01
ß Mahindra United Football Club Private Limited .... - 100.00% - * - -
Mahindra Lifespace Developers Limited .................. 2,08,46,126 51.08% - 23.68 5.21 39.44
 Mahindra Infrastructure Developers Limited ....... - 40.87% - 0.10 - 0.12
 Mahindra World City Developers Limited ........... - 42.21% - 12.08 - 2.50
 Mahindra World City (Jaipur) Limited ................. - 37.80% - 1.94 - (1.13)
 Mahindra Integrated Township Limited .............. - 48.77% - 0.21 - (0.30)
 Mahindra Residential Developers Limited ........... - 24.87% - (0.16) - *
 Mahindra World City (Maharashtra) Limited ...... - 51.08% - (0.01) - (0.03)
 Mahindra Knowledge City Limited (formerly known
as Mahindra Technology Park Limited) ............... - 51.08% - (0.09) - (0.10)
 Mahindra Bebanco Developers Limited ............... - 35.76% - (0.11) - -
 Mahindra Industrial Township Limited ................ - 51.08% - (0.03) - -
Mahindra & Mahindra Financial Services Limited ... 5,82,41,532 #60.10% - 128.93 26.21 271.84
 Mahindra Insurance Brokers Limited ................... - #60.10% - 3.53 - 2.36
 Mahindra Rural Housing Finance Limited ............ - #52.59% - (0.42) - (0.31)
Tech Mahindra Limited ........................................... 5,37,76,252 48.83% 21.51 456.61 29.58 438.47
 Tech Mahindra (Americas) Inc. ............................ - 48.83% - 6.61 - 3.38
 Tech Mahindra GmbH ......................................... - 48.83% - 1.76 - (14.01)
 Tech Mahindra Singapore Pte. Limited ............... - 48.83% - 0.71 - 2.35
 Tech Mahindra (Thailand) Limited ....................... - 48.83% - 0.04 - 0.30
 PT Tech Mahindra Indonesia ............................... - 48.83% - 4.01 - 0.53

* denotes amount less than Rs. 50,000

127
Statement pursuant to Section 212 of the Companies Act, 1956, relating to subsidiary companies
Number of The net aggregate of profits/(losses) of the
Shares in the Subsidiary Companies so far as they concern the members of
Subsidiary Mahindra & Mahindra Limited
Company held
by Mahindra & Mahindra For Current Financial Year For Previous Financial Years
Name of the Subsidiary Companies Limited at the Dealt with in Not dealt Dealt with in Not dealt
financial year the accounts with in the the accounts with in the
ending date of Mahindra & accounts of of Mahindra & accounts of
Mahindra Mahindra & Mahindra Mahindra &
Limited for Mahindra Limited for Mahindra
the year Limited for the year Limited for
Equity Extent ended 31st the year ended 31st the year
of March, 2009 ended 31st March, 2009 ended 31st
holding March, 2009 March, 2009
Nos. % Rupees crores Rupees crores Rupees crores Rupees crores
 CanvasM Technologies Limited ............................ - 39.11% - 0.13 - (0.78)
∆ CanvasM (Americas) Inc. ..................................... - 39.11% - (0.04) - 0.06
 Tech Mahindra Foundation ................................. - 48.83% - 0.01 - -
 Tech Mahindra (Malaysia) SDN.BHD .................... - 48.83% - 0.05 - 0.02
 Tech Mahindra (Beijing) IT Services Limited ........ - 48.83% - (0.72) - (0.12)
 Venturbay Consultants Private Limited ............... - 48.83% - * - -
Bristlecone Limited .................................................. 42,22,250 82.05% - (4.71) - (5.87)
 Bristlecone Inc. .................................................... - 82.05% - (0.23) - (28.55)
 Bristlecone India Limited ..................................... - 82.05% - 7.81 - 4.51
 Bristlecone (Singapore) Pte. Limited ................... - 82.05% - (1.01) - (1.18)
 Bristlecone GmbH ............................................... - 82.05% - 0.25 - (0.30)
 Mahindra IT Consulting Private Limited .............. - 82.05% - * - -
 Bristlecone UK Limited ........................................ - 82.05% - (5.25) - (5.85)
 Bristlecone (Malaysia) SDN.BHD .......................... - 82.05% - 0.19 - 0.48
Mahindra Logisoft Business Solutions Limited ........ 63,49,500 100.00% - 1.22 - (3.60)
Mahindra First Choice Wheels Limited (formerly
known as FirstChoice Wheels Limited) .................... 3,47,77,255 #53.31% - (11.63) - (22.97)
Mahindra USA Inc. ................................................. 9,50,00,000 100.00% - (32.83) - 23.93
Mahindra Gujarat Tractor Limited ........................... 16,83,218 60.00% - (0.84) - (16.04)
Mahindra Shubhlabh Services Limited .................... 2,46,81,437 83.05% - (0.56) - (21.42)
Mahindra & Mahindra South Africa
(Proprietary) Limited ............................................... 3,35,70,000 90.73% - (21.36) - 7.29
Mahindra Overseas Investment Company
(Mauritius) Limited .................................................. 4,47,70,000 100.00% - (2.18) - (2.60)
 Mahindra (China) Tractor Company Limited ....... - 84.87% - (17.10) - (37.81)
 Mahindra-BT Investment Company
(Mauritius) Limited .............................................. - 57.00% - 5.51 - 1.97
 Mahindra Europe s.r.l. ......................................... - 80.00% - 0.37 - 1.84
 Mahindra Graphic Research Design s.r.l. ............ - 100.00% - (2.03) - (0.44)
 Mahindra Yeuda (Yancheng) Tractor Company
Limited ................................................................ - 51.00% - (1.44) - -
Mahindra SAR Transmission Private Limited ........... 75,56,900 100.00% - 2.62 - 0.59
Mahindra Engineering Services Limited
(formerly known as Mahindra Engineering Design
& Development Company Limited) ......................... 81,26,218 100.00% - 17.77 - 44.26

* denotes amount less than Rs. 50,000

128
 MAHINDRA & MAHINDRA LIMITED

Statement pursuant to Section 212 of the Companies Act, 1956, relating to subsidiary companies
Number of The net aggregate of profits/(losses) of the
Shares in the Subsidiary Companies so far as they concern the members of
Subsidiary Mahindra & Mahindra Limited
Company held
by Mahindra & Mahindra For Current Financial Year For Previous Financial Years
Name of the Subsidiary Companies Limited at the Dealt with in Not dealt Dealt with in Not dealt
financial year the accounts with in the the accounts with in the
ending date of Mahindra & accounts of of Mahindra & accounts of
Mahindra Mahindra & Mahindra Mahindra &
Limited for Mahindra Limited for Mahindra
the year Limited for the year Limited for
Equity Extent ended 31st the year ended 31st the year
of March, 2009 ended 31st March, 2009 ended 31st
holding March, 2009 March, 2009
Nos. % Rupees crores Rupees crores Rupees crores Rupees crores
 Mahindra Engineering Services (Europe) Limited
(formerly known as Plexion Technologies
(UK) Limited) ....................................................... - 100.00% - 4.32 - 2.22
 Plexion Technologies GmbH ................................ - 100.00% - (0.21) - (0.07)
 Mahindra Technologies Inc. (formerly known as
Plexion Technologies Inc.) ................................... - 100.00% - (0.23) - (1.07)
 Engines Engineering S.r.l. .................................... - 70.00% - (1.05) - -
 EFF Engineering S.r.l. ........................................... - 35.70% - 0.02 - -
 ID-EE S.r.l. ........................................................... - 49.00% - (0.09) - -
Mahindra Forgings Limited ..................................... 4,15,26,339 60.56% - (25.07) - (8.58)
£ Stokes Group Limited .......................................... - 60.43% - (33.14) - 0.01
 Stokes Forgings Dudley Limited .......................... - 60.43% - - - 0.74
 Jensand Limited ................................................... - 60.43% - - - (0.32)
 Stokes Forgings Limited. ..................................... - 60.43% - 4.41 - (9.36)
£ Mahindra Forgings Global Limited ..................... - 60.56% - (0.08) - (2.17)
 Schöneweiss & Co. GmbH .................................. - 60.56% - (1.64) - 14.67
£ Mahindra Forgings International Limited ............ - 60.56% - (1.48) - (12.71)
ë Mahindra Forgings Europe AG ........................... - 60.56% - 1.49 - 9.16
• Gesenkschmiede Schneider GmbH ..................... - 60.56% - (5.05) - 9.11
• JECO-Jellinghaus GmbH ...................................... - 60.56% - (4.05) - 7.55
• Falkenroth Umformtechnik GmbH ...................... - 60.56% - (5.12) - 8.19
Mahindra Renault Private Limited ........................... 10,16,24,232 51.00% - (250.01) - (46.11)
Mahindra Navistar Automotives Limited (formerly
known as Mahindra International Limited) ............. 16,33,40,600 51.00% - (12.82) - (4.08)
Mahindra Castings Private Limited .......................... 1,64,87,602 65.00% - 1.70 - 0.77
 Mahindra Hinoday Industries Limited .................. - #64.71% - (30.87) - (5.36)
Mahindra Vehicle Manufacturers Limited (formerly
known as Mahindra Automotive Limited) .............. 48,50,00,000 100.00% - (6.57) - (2.32)
Mahindra Logistics Limited ..................................... 4,90,49,900 100.00% - 4.46 - (0.01)
Mahindra Navistar Engines Private Limited ............. 2,11,65,000 51.00% - (3.62) - (0.08)
Mahindra Aerospace Private Limited ...................... 50,000 100.00% - (0.26) - (0.12)
Mahindra First Choice Services Limited ................... 1,10,50,000 100.00% - (5.86) - -
Mahindra Gears International Limited .................... 2,07,00,001 100.00% - (0.11) - -
e Mahindra Gears Global Limited (formerly known
as Iven International Gear Mauritius Limited) ..... - 53.34% - (0.08) - -
| Mahindra Gears Cyprus Limited (formerly known
as Kalbarri Trading Limited) ................................ - 53.34% - (0.38) - -

129
Statement pursuant to Section 212 of the Companies Act, 1956, relating to subsidiary companies
Number of The net aggregate of profits/(losses) of the
Shares in the Subsidiary Companies so far as they concern the members of
Subsidiary Mahindra & Mahindra Limited
Company held
by Mahindra & Mahindra For Current Financial Year For Previous Financial Years
Name of the Subsidiary Companies Limited at the Dealt with in Not dealt Dealt with in Not dealt
financial year the accounts with in the the accounts with in the
ending date of Mahindra & accounts of of Mahindra & accounts of
Mahindra Mahindra & Mahindra Mahindra &
Limited for Mahindra Limited for Mahindra
the year Limited for the year Limited for
Equity Extent ended 31st the year ended 31st the year
of March, 2009 ended 31st March, 2009 ended 31st
holding March, 2009 March, 2009
Nos. % Rupees crores Rupees crores Rupees crores Rupees crores
♠ Mahindra Metal Castello S.r.l. ............................. - 51.00% - (5.15) - -
å Metalcastello S.p.A. ............................................ - 51.00% - 11.96 - -
« Crest Geartech Private Limited ............................ - 51.00% - 0.13 - -
Mahindra Automotive Australia Pty. Limited .......... 7,00,000 80.00% - (1.87) - -
Mahindra Two Wheelers Limited ............................ 11,80,00,000 80.00% - (18.00) - -
Mahindra Defence Land Systems Private Limited… - 100.00% - - - -
# after considering shares issued to its ESOP Trust but not allotted to its employees.
@ a subsidiary of Mahindra Intertrade Limited
+ a subsidiary of Mahindra Holidays & Resorts India Limited
ß a subsidiary of Mahindra Holdings Limited
 a subsidiary of Mahindra Lifespace Developers Limited
 a subsidiary of Mahindra Integrated Township Limited
 a subsidiary of Mahindra & Mahindra Financial Services Limited
 a subsidiary of Tech Mahindra Limited
∆ a subsidiary of CanvasM Technologies Limited
 a subsidiary of Bristlecone Limited
 a subsidiary of Bristlecone India Limited
 a subsidiary of Mahindra Overseas Investment Company (Mauritius) Limited
 a subsidiary of Mahindra Engineering Services Limited (formerly known as Mahindra Engineering Design & Development Company Limited)
 a subsidiary of Engines Engineering S.r.l
£ a subsidiary of Mahindra Forgings Limited
 a subsidiary of Stokes Group Limited
 a subsidiary of Mahindra Forgings Global Limited
ë a subsidiary of Mahindra Forgings International Limited
• a subsidiary of Mahindra Forgings Europe AG
 a subsidiary of Mahindra Castings Private Limited
e a subsidiary of Mahindra Gears International Limited
| a subsidiary of Mahindra Gears Global Limited (formerly known as Iven International Gear Mauritius Limited)
♠ a subsidiary of Mahindra Gears Cyprus Limited (formerly known as Kalbarri Trading Limited)
å a subsidiary of Mahindra Metal Castello S.r.l
« a subsidiary of Metalcastello S.p.A
Note :
The financial year of all subsidiaries ended on 31st March 2009, except for Tech Mahindra (Beijing) IT Services Limited whose financial year is 1st
January, 2008 to 31st December, 2008, Mahindra Yeuda (Yancheng) Tractor Company Limited and Mahindra Defence Land Systems Private Limited
whose first financial years would be from 28th November, 2008 to 31st December, 2008 and 4th March, 2009 to 31st March, 2010 respectively.

}
M. M. Murugappan Keshub Mahindra Chairman
N. Vaghul
R. K. Kulkarni Anand G. Mahindra Vice Chairman & Managing Director
A. S. Ganguly Directors
A. P. Puri
N. B. Godrej
Bharat Doshi
A. K. Nanda } Executive Directors
A. K. Dasgupta
Narayan Shankar Company Secretary
Mumbai, 28th May, 2009

130

Report of the Auditors to the Board of Directors of Mahindra & Mahindra Limited
1. We have audited the attached consolidated balance sheet
of Mahindra & Mahindra Limited and its subsidiaries (the
Group) as at 31st March, 2009, and also the consolidated
profit and loss account and the consolidated cash flow
statement for the year ended on that date, annexed thereto.
These consolidated financial statements are the responsibility
of Mahindra & Mahindra Limited’s management and have
been prepared by the management on the basis of separate
financial statements and other financial information
regarding components. Our responsibility is to express an
opinion on these consolidated financial statements based
on our audit.
2. We conducted our audit in accordance with the auditing
standards generally accepted in India. Those Standards
require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes
examining on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also
includes assessing the accounting principles used and
significant estimates made by management, as well as
evaluating the overall financial statement presentation. We
believe that our audit provides a reasonable basis for our
opinion.
3. We did not audit the financial statements of certain
subsidiaries and joint ventures, whose financial statements
reflect Group’s share of total assets of Rs. 13,173.97 crores
as at 31st March, 2009 and Group’s share of total revenues
of Rs. 6,428.53 crores for the year ended on that date and
Group’s share of total net cash inflow of Rs. 173.33 crores
for the year ended on that date and associates whose
financial statements reflect the Group’s share of profit (net)
up to 31st March, 2009 of Rs. 34.59 crores and of the
Group’s share of profit (net) Rs. 11.27 crores for the year
ended on that date as considered in the consolidated
financial statements. These financial statements and other
financial information have been audited by other auditors
whose reports have been furnished to us, and our opinion
MAHINDRA & MAHINDRA LIMITED (CONSOLIDATED)
in so far as it relates to the amounts included in respect of
these subsidiaries, joint ventures and associates, is based
solely on the report of the other auditors.
4. We report that the consolidated financial statements have
been prepared by Mahindra & Mahindra Limited’s
management in accordance with the requirements of
Accounting Standard 21, Consolidated Financial Statements,
Accounting Standard 23, Accounting for Investments in
Associates in Consolidated Financial Statements and
Accounting Standard 27, Financial Reporting of Interests in
Joint Ventures, notified by the Companies (Accounting
Standards) Rules, 2006.
5. Based on our audit and on consideration of the reports of
other auditors on separate financial statements and on the
other financial information of the components, in our
opinion and to the best of our information and according
to the explanations given to us, the attached consolidated
financial statements give a true and fair view in conformity
with the accounting principles generally accepted in India:
(a) in the case of the consolidated balance sheet, of the
state of affairs of Mahindra & Mahindra Limited Group
as at 31st March, 2009;
(b) in the case of the consolidated profit and loss account,
of the profit for the year ended on that date; and
(c) in the case of the consolidated cash flow statement, of
the cash flows for the year ended on that date.
For Deloitte Haskins & Sells
Chartered Accountants
B.P. Shroff
(Partner)
Membership Number: 34382
Mumbai, 28th May, 2009
131
Consolidated Balance Sheet as at 31st March, 2009
Rupees crores

Schedule 2009 2008

I. SOURCES OF FUNDS :
SHAREHOLDERS’ FUNDS :
Capital ........................................................................................ I 272.62 239.07
Employee Stock Options Outstanding ........................................ 6.55 4.00
Reserves and Surplus .................................................................. II 6,763.29 5,921.70
7,042.46 6,164.77
MINORITY INTEREST ................................................................... 3,057.26 2,734.52
LOAN FUNDS :
(a) Secured Loans ....................................................................... III A 7,724.71 6,981.88
(b) Unsecured Loans ................................................................... III B 4,465.60 2,899.13
12,190.31 9,881.01
DEFERRED INCOME :
Advance towards Club Mahindra members’ facilities ................ 635.89 477.95
Total ............ 22,925.92 19,258.25
II. APPLICATION OF FUNDS :
FIXED ASSETS : IV
Gross Block ................................................................................. 13,042.35 10,690.36
Less : Depreciation ..................................................................... 5,341.02 4,219.02
Net Block .................................................................................... 7,701.33 6,471.34
CAPITAL WORK-IN-PROGRESS (INCLUDING CAPITAL ADVANCES) 1,751.73 1,154.17
9,453.06 7,625.51
Less : Provision for impairment .................................................. 311.25 —
9,141.81 7,625.51
INVESTMENTS ............................................................................. V 3,381.26 1,354.72
DEFERRED TAX ASSETS (Net) ...................................................... 188.40 17.57
FOREIGN CURRENCY MONETARY ITEM TRANSLATION
DIFFERENCE ACCOUNT [NOTE 7(iv)] ........................................... 18.44 —
CURRENT ASSETS, LOANS AND ADVANCES :
(a) Inventories ............................................................................. VI A 3,271.46 3,275.42
(b) Sundry Debtors ..................................................................... VI B 3,470.79 3,767.83
(c) Cash and Bank Balances ....................................................... VI C 2,967.51 1,727.99
(d) Other Current Assets ............................................................. VI D 3.19 15.65
(e) Loans and Advances ............................................................. VI E 8,861.91 8,141.64
18,574.86 16,928.53
LESS: CURRENT LIABILITIES AND PROVISIONS :
(a) Current Liabilities .................................................................. VII A 6,779.96 5,291.24
(b) Provisions .............................................................................. VII B 1,615.75 1,391.02
8,395.71 6,682.26
NET CURRENT ASSETS ................................................................ 10,179.15 10,246.27
MISCELLANEOUS EXPENDITURE (TO THE EXTENT NOT WRITTEN
OFF OR ADJUSTED) .................................................................... VIII 16.86 14.18
Total ............ 22,925.92 19,258.25
NOTES ON ACCOUNTS ............................................................ XV

Per our report attached

}
For Deloitte Haskins & Sells M. M. Murugappan Keshub Mahindra Chairman
Chartered Accountants N. Vaghul
R. K. Kulkarni Anand G. Mahindra Vice Chairman & Managing Director
A. S. Ganguly Directors
B. P. Shroff
Partner
A. P. Puri
N. B. Godrej
Bharat Doshi
A. K. Nanda } Executive Directors
A. K. Dasgupta
Narayan Shankar Company Secretary
Mumbai, 28th May, 2009 Mumbai, 28th May, 2009

132
 MAHINDRA & MAHINDRA LIMITED (CONSOLIDATED)

Consolidated Profit and Loss Account for the year ended 31st March, 2009
Rupees crores

Schedule 2009 2008

SALES .......................................................................................................................... 21,058.63 19,774.30
Less : Excise Duty on Sales ......................................................................................... 2,072.18 2,154.82
Net Sales ..................................................................................................................... 18,986.45 17,619.48
Income from Operations ............................................................................................ IX 7,769.90 6,592.52
Other Income ............................................................................................................. X 163.46 233.29
26,919.81 24,445.29
EXPENDITURE :
Raw Materials, Finished and Semi-finished Products… .............................................. XI 13,063.79 11,629.15
Personnel .................................................................................................................... XII 4,274.86 3,630.12
Interest, Commitment and Finance Charges (Net) ..................................................... XIII 750.16 589.52
Depreciation/Amortisation [Note 9] ............................................................................ 749.33 582.24
Other Expenses… ....................................................................................................... XIV 5,858.96 5,373.63
24,697.10 21,804.66
Less : Cost of Manufactured/Purchased Products capitalised ..................................... 107.80 157.64
24,589.30 21,647.02
Profit before exceptional item and taxation ............................................................... 2,330.51 2,798.27
Add : Exceptional Items [Note 19] ............................................................................. (76.39) (294.28)
Profit before taxation ................................................................................................. 2,254.12 2,503.99
Less : Provision for Tax - Current Tax including Fringe Benefit Tax ............................ 506.92 691.84
- Deferred Tax (Net) [Note 18] ............................................. 35.25 (34.64)
Profit for the year before prior year adjustments ....................................................... 1,711.95 1,846.79
Less : Adjustments pertaining to previous years [Note 20] ........................................ 6.36 2.22
Balance of profit for 2008-2009 before share of profit/loss of Associates and
Minority Interests ........................................................................................................ 1,705.59 1,844.57
Add : Share of Profit of Associates for the year ........................................................ 11.27 10.00
Profit before Minority Interests ................................................................................... 1,716.86 1,854.57
Minority Share in Profits for 2008-2009 .................................................................... 311.45 283.45
Net Profit .................................................................................................................... 1,405.41 1,571.12
Balance of profit for earlier years ............................................................................... 3,873.20 2,945.13
Less : Adjustment on account of Mergers .................................................................. 43.91 —
Less : Transfer to Debenture Redemption Reserve (Net) ............................................. (29.62) (16.88)
3,799.67 2,928.25
Total of Profit and Loss Account balances shown above ........................................... 5,205.08 4,499.37
Deduct : Statutory Reserve ........................................................................................ 26.62 49.04
General Reserve (Net) .................................................................................. 180.05 242.33
Capital Redemption Reserve ........................................................................ 18.75 —
Interim Dividends Paid ................................................................................ 23.51 —
Income Tax on Dividends… ......................................................................... 28.86 13.71
Proposed Dividend on Equity Shares .......................................................... 278.83 282.61
Income Tax on Proposed Dividend .............................................................. 33.23 38.48
Balance for 2008-2009 and earlier years carried to Balance Sheet ............................ 4,615.23 3,873.20
EARNINGS PER SHARE : [Note 24]
(Face value Rs.10/- per share) (Rupees)
Basic ........................................................................................................................... 51.57 65.84
Diluted ........................................................................................................................ 48.27 59.84
NOTES ON ACCOUNTS ........................................................................................... XV

Per our report attached

}
For Deloitte Haskins & Sells M. M. Murugappan Keshub Mahindra Chairman
Chartered Accountants N. Vaghul
R. K. Kulkarni Anand G. Mahindra Vice Chairman & Managing Director
A. S. Ganguly Directors
B. P. Shroff
Partner
A. P. Puri
N. B. Godrej
Bharat Doshi
A. K. Nanda } Executive Directors
A. K. Dasgupta
Narayan Shankar Company Secretary
Mumbai, 28th May, 2009 Mumbai, 28th May, 2009

133
Consolidated Cash Flow Statement for the year ended 31st March, 2009
Rupees crores

2009 2008
A. CASH FLOW FROM OPERATING ACTIVITIES :
Net Profit before exceptional item, taxation and adjustments pertaining to
previous years .............................................................................................. 2,330.51 2,798.27
Adjustments for :
Depreciation/Amortisation ........................................................................... 749.33 582.24
Profit on Exchange (Net) ............................................................................. (5.58) (30.61)
Investment and Interest Income [Excluding Rs. 13.42 crores
(2008 : Rs. 5.93 crores) in respect of financial enterprises consolidated] ... (195.25) (170.85)
Interest, Commitment and Finance charges [Excluding Rs. 495.05 crores
(2008 : Rs. 453.06 crores) in respect of financial enterprises consolidated] 362.84 262.51
Amortisation of Expenses ............................................................................ 15.81 12.62
Profit on sale of Investments (Net) .............................................................. (47.78) (180.00)
(Profit)/Loss on fixed assets sold/scrapped/written off (Net) ........................ 6.04 (19.83)
Provision for diminution in value of long term investments (Net) .............. 0.24 4.33
(Increase)/Decrease of cost over fair value of current investments (Net) ..... (1.93) (1.74)
883.72 458.67

Operating Profit before Working Capital changes ....................................... 3,214.23 3,256.94

Changes in : Deferred income – advances towards membership fees ........ 157.94 158.44
Trade and other receivables ................................................... 85.05 (1,091.40)
Loans against Assets * ........................................................... (185.28) (808.55)
Inventories ............................................................................. 177.94 (703.34)
Trade and other payables ...................................................... 690.40 1,094.40
926.05 (1,350.45)
Exceptional Items :
Upfront payment to a customer ................................................................. — (440.12)
Miscellaneous Expenditure (to the extent not written off or adjusted)
incurred during the year ............................................................................. (21.44) (5.18)
Cash generated/(used) from operations ...................................................... 4,118.84 1,461.19
Income Taxes paid (Net of refunds including for prior years) ..................... (717.34) (762.32)

NET CASH FROM OPERATING ACTIVITIES .................................................... 3,401.50 698.87

* In respect of financial enterprises consolidated.

B. CASH FLOW FROM INVESTING ACTIVITIES :

Purchase of fixed assets .............................................................................. (2,941.33) (1,972.30)
Sale of fixed assets ...................................................................................... 81.73 45.40
Purchase of investments .............................................................................. (20,148.97) (16,307.27)
Sale of investments ..................................................................................... 19,692.81 15,937.00
Interest received .......................................................................................... 79.52 124.81
Dividends received ....................................................................................... 35.88 30.16
Inter corporate deposits (Net) ..................................................................... 14.88 8.41
Purchase consideration paid on acquisition of interest in subsidiaries ....... (562.95) (1,311.48)
Sales Proceeds (Net) received on divesture of interest in subsidiaries ......... 305.14 675.68
NET CASH USED IN INVESTING ACTIVITIES ................................................. (3,443.29) (2,769.59)

134
 MAHINDRA & MAHINDRA LIMITED (CONSOLIDATED)

Consolidated Cash Flow Statement (Contd.)

Rupees crores

2009 2008
C. CASH FLOW FROM FINANCING ACTIVITIES :
Proceeds from borrowings .......................................................................... 7,718.58 32,458.76
Repayments of borrowings (including premium on repayment) ................. (5,811.46) (30,376.23)
Dividends paid ............................................................................................. (371.78) (131.72)
Interest, Commitment and Finance charges paid ........................................ (328.81) (260.65)
NET CASH FROM FINANCING ACTIVITIES .................................................... 1,206.53 1,690.16

NET INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS (A + B + C) 1,164.74 (380.56)

CASH AND CASH EQUIVALENTS [Note (a)]

Opening Balance ......................................................................................... 1,785.67 2,085.16
Cash & Bank Balance Acquired on Acquisition of Subsidiaries ................... 4.37 81.07
Cash & Bank Balance on Disposal of Subsidiary .......................................... (1.71) —

Closing Balance ........................................................................................... 2,953.07 1,785.67

Per our report attached

}
For Deloitte Haskins & Sells M. M. Murugappan Keshub Mahindra Chairman
Chartered Accountants N. Vaghul
R. K. Kulkarni Anand G. Mahindra Vice Chairman & Managing Director
A. S. Ganguly Directors
B. P. Shroff
Partner
A. P. Puri
N. B. Godrej
Bharat Doshi
A. K. Nanda } Executive Directors
A. K. Dasgupta
Narayan Shankar Company Secretary
Mumbai, 28th May, 2009 Mumbai, 28th May, 2009

Notes to the Consolidated Cash Flow Statement for the year ended 31st March, 2009
Rupees crores

2009 2008

(a) Cash and Bank Balances .............................................................................. 2,967.51 1,727.99

Unrealised (Net) translation (gain)/loss on foreign currency cash and cash
equivalents .................................................................................................. (14.44) 57.68
Total cash and cash equivalent ................................................................... 2,953.07 1,785.67

(b) The following non-cash transactions do not form part of Cash Flow :
i) Arising out of the scheme of arrangement for the merger between company’s subsidiaries Tech Mahindra (R & D Services)
Limited and iPolicy Networks Limited (IPNL) with Tech Mahindra Limited.
(ii) Arising out of the scheme of arrangement for the merger of Tech Mahindra (R & D Services) Inc. with Tech Mahindra
Americas Inc.
(iii) In accordance with a scheme of amalgamation, the company’s wholly owned subsidiary Mahindra Holdings and Finance
Limited has merged with the Company.
(iv) In accordance with a scheme of amalgamation, the company’s subsidiary Punjab Tractors Limited has merged with the
Company
(c) Previous year’s figures have been regrouped/restated wherever necessary.

135
SCHEDULE I Rupees crores
2009 2008
Share Capital :
Authorised :
60,00,00,000 (2008 - 37,50,00,000) Ordinary (Equity) Shares of Rs. 10 each 600.00 375.00
25,00,000 Unclassified shares of Rs.100 each ............................................. 25.00 25.00
Total .............. 625.00 400.00
Issued and Subscribed :
27,88,21,265 (2008 - 24,57,41,813) Ordinary (Equity) Shares of Rs.10 each
fully paid up ............................................................................... 278.82 245.74
278.82 245.74
Less :
62,05,305 (2008 - 66,68,431) Ordinary (Equity) Shares of Rs.10 each fully
paid up issued to ESOP Trust but not allotted to employees ..... 6.20 6.67
Adjusted : Issued and Subscribed Share Capital ...................................................... 272.62 239.07

SCHEDULE II Rupees crores

2008 Additions Deductions 2009
Reserves and Surplus :
1 Capital Reserve .................................................................... 23.48 0.08 0.02 23.54
23.43 0.05 — 23.48
2 Capital Reserve on consolidation ......................................... 138.55 0.46 — 139.01
138.55 — — 138.55
3 Securities Premium Account ................................................ 579.03 10.95 44.32 545.66
554.03 27.15 2.15 579.03
Less : Premium on shares issued to ESOP Trust but not 16.34 — 1.14 15.20
allotted to employees [Note 5] ............................................ 17.98 — 1.64 16.34
562.69 10.95 43.18 530.46
536.05 27.15 0.51 562.69
4 Revaluation Reserve ............................................................. 12.47 — 0.38 12.09
12.86 — 0.39 12.47
5 General Reserve ................................................................... 971.84 180.05 104.18** 1,047.71
742.98 242.33 13.47 971.84
Add : Bonus shares issued to ESOP Trust but not allotted
to employees [Note 5] ......................................................... 3.33 — 0.23 3.10
3.67 — 0.34 3.33
975.17 178.60 102.96 1,050.81
746.65 242.33 13.81 975.17
6 Debenture Redemption Reserve ........................................... 18.24 29.62$ — 47.86
1.36 16.88$ — 18.24
7 Investment Fluctuation Reserve ........................................... 30.61 806.61 154.38 682.84
30.61 — — 30.61
8 Capital Redemption Reserve ................................................ 50.00 18.75*** — 68.75
50.00 — — 50.00
9 Special Reserve (As per Section 45 IC of the RBI Act) ......... 194.51 26.62 91.22 129.91
145.47 49.04 — 194.51
10 Hedging Reserve Account [Note 6] ..................................... 28.78 — 508.68 (479.90)
— 41.70 12.92 28.78
11 Foreign Exchange Fluctuation Reserve ................................. 14.00 — 71.31 (57.31)
(16.57) 30.57 — 14.00
2,048.50 1,071.69 972.13 2,148.06*
1,668.41 407.72 27.63 2,048.50*

* {including Group Share in Joint Ventures Rs. 3.21 crores (2008 : Rs. 3.30 crores)}
12 Balance for 2008-2009 and earlier years as per
Profit and Loss Account ...................................................... 4,587.16
3,851.12
Group Share in Joint Ventures ............................................ 28.07
22.08
Total ................. 6,763.29
5,921.70

** Adjustment on adoption of Companies (Accounting Standards) Amendment Rules, 2009 on Accounting Standard 11 - Net of
Tax of Rs. 21.03 crores [Note 7]
*** Transfer of Rs. 18.75 crores (2008 : Rs. Nil) from Profit and Loss Account
$ Transfer from Profit and Loss Account Rs. 29.62 crores (2008 : Rs. 16.88 crores)

136
 MAHINDRA & MAHINDRA LIMITED (CONSOLIDATED)

SCHEDULE III Rupees crores

2009 2008
Loan Funds :
(A) Secured : [Note 8]
(1) Debentures/Bonds ........................................................ 2,880.86 3,585.51
(2) Foreign Currency Loans from Banks ............................. 1,133.97 748.10
(3) Rupee Loans :
(a) From Financial Institutions .................................... 41.92 6.05
(b) From Banks ........................................................... 2,648.08 1,638.59
(c) From Others .......................................................... 56.00 62.40

2,746.00 1,707.04
(4) Loans and Advances on cash credit account from Banks 709.36 655.29
(5) Short-term Foreign Currency Loans from Banks ........... 253.70 284.06
7,723.89 6,980.00
Group Share in Joint Ventures ............................................ 0.82 1.88
Total .................................. 7,724.71 6,981.88

(B) Unsecured :
(1) Fixed Deposits .............................................................. 103.26 8.44
(2) Short-term Loans :
(a) From Banks ........................................................... 658.12 476.02
(b) From Others .......................................................... 213.84 —

871.96 476.02
(3) Other Loans :
(a) From Financial Institutions .................................... 688.67 573.98
(b) Foreign Currency Loans from Banks ...................... 625.65 491.02
(c) Zero Coupon Convertible Bonds ........................... 961.52 802.60
(d) Debentures/Bonds ................................................. 321.00 331.20
(e) 9.25% Fully and Compulsorily Convertible
Debentures ............................................................ 700.00 —
(f) From Government of Gujarat ................................ 9.85 9.40
(g) From Banks ........................................................... 137.81 161.28
(h) From Others .......................................................... 45.88 45.19

3,490.38 2,414.67
Total .................................. 4,465.60 2,899.13
Total .................................. 12,190.31 9,881.01

137
 SCHEDULE IV

138
Fixed Assets :

Rupees crores
Description of Assets Cost/ Additions Deductions Cost/Pro- Depreciation/ Depreciation/ Deductions Depreciation/ Net Balance Impairment Net Balance Net Balance
Professional and and fessional Amortisation Amortisation and adjust- Amortisation before for 2008- after as at 31st
valuation adjustments adjustments valuation to 31st for 2008- ments of to 31st Impairment 2009 $ Impairment March,
as at 31st during the during as at 31st March, 2009 # Depreciation/ March, as at 31st as at 31st 2008
March, year # the year March, 2008 Amortisation 2009 March, March,
2008 2009 2009 2009

A : Assets on Lease
Plant and Machinery ................ 7.64 66.47 — 74.11 0.19 35.69 — 35.88 38.23 — 38.23 7.45
Vehicles .................................... 7.17 0.32 5.04 2.45 4.14 0.31 3.62 0.83 1.62 — 1.62 3.03
Sub Total A .............................. 14.81 66.79 5.04 76.56 4.33 36.00 3.62 36.71 39.85 — 39.85 10.48
B: Owned Assets
Land - Freehold ........................ 137.99 58.52 3.87 192.64 — 0.40 0.15 0.25 192.39 — 192.39 137.99
Land - Leasehold ...................... 319.57 79.03 (0.79) 399.39 4.24 3.81 (0.15) 8.20 391.19 — 391.19 315.33
Buildings - Freehold ................. 1,295.23 515.75 (20.88) 1,831.86 400.39 63.26 (11.07) 474.72 1,357.14 — 1,357.14 894.84
Buildings - Leasehold ............... 42.11 13.56 0.94 54.73 9.62 13.84 0.53 22.93 31.80 — 31.80 32.49
Plant and Machinery ................ 5,687.40 1,739.86 25.32 7,401.94 3,321.79 856.30 33.34 4,144.75 3,257.19 239.60 3,017.59 2,365.61
Furniture and Fittings ............... 503.91 112.26 (5.82) 621.99 266.78 76.55 (0.69) 344.02 277.97 1.70 276.27 237.13
Vehicles, Cycles, etc. ................ 179.88 50.80 19.62 211.06 82.65 27.66 12.00 98.31 112.75 — 112.75 97.23
Technical Knowhow ................. 99.08 10.95 — 110.03 23.47 21.51 — 44.98 65.05 55.57 9.48 75.61
Development Expenditure ........ 162.62 216.80 (0.07) 379.49 25.62 19.35 — 44.97 334.52 0.75 333.77 137.00
Software Expenditure ............... 100.57 73.38 0.43 173.52 60.11 33.85 1.11 92.85 80.67 0.25 80.42 40.46
Websites ................................... 3.74 0.03 0.27 3.50 3.74 — 0.27 3.47 0.03 — 0.03 —
Non-Compete Fees ................... 2.23 4.00 2.50 3.73 0.50 0.24 0.50 0.24 3.49 — 3.49 1.73
Timeshare weeks ...................... 0.62 — — 0.62 0.37 0.06 — 0.43 0.19 — 0.19 0.25
Trademarks ............................... 16.76 7.54 (0.67) 24.97 8.38 0.17 (0.57) 9.12 15.85 — 15.85 8.38
Other Intangible ....................... 0.58 25.19 1.65 24.12 0.01 9.65 1.82 7.84 16.28 — 16.28 0.57
Goodwill + .............................. 2,112.50 506.87 1,099.79 1,519.58 — — — — 1,519.58 — 1,519.58 2,112.50

Sub Total B ............................... 10,664.79 3,414.54 1,126.16 12,953.17 4,207.67 1,126.65 37.24 5,297.08 7,656.09 297.87 7,358.22 6,457.12

C: Group Share in
Joint Ventures .............. 10.76 2.54 0.68 12.62 7.02 0.84 0.63 7.23 5.39 — 5.39 3.74

TOTAL (A+B+C) ....................... 10,690.36 3,483.87 1,131.88 13,042.35 4,219.02 1,163.49 41.49 5,341.02 7,701.33 297.87 7,403.46 6,471.34

D : Capital Work-in-Progress
and Advances .............. 1,751.73 13.38 1,738.35 1,154.17

Grand Total (A+B+C+D) ......... 10,690.36 3,483.87 1,131.88 13,042.35 4,219.02 1,163.49 41.49 5,341.02 9,453.06 311.25 9,141.81 7,625.51
7,818.72 3,098.29 226.65 10,690.36 3,591.27 828.14 200.39 4,219.02

+ Goodwill arising on consolidation.

# Refer Note 9 (b)
$ During the period, there have been significant changes in the economic environment of an unit of Automotive Segment, indicating that the economic performance of its assets needs to be reviewed for their recoverable amount.
Pursuant to such a review it has recognised an impairment loss of Rs. 311.25 crores in respect of such of its fixed assets.
 MAHINDRA & MAHINDRA LIMITED (CONSOLIDATED)

SCHEDULE V Rupees crores

2009 2009 2008 2008
Long Term Current Long Term Current

Investments (At Cost unless otherwise specified) :

Shares (Non-trade and fully paid-up unless otherwise specified) :
Unquoted :
(a) Equity Shares ......................................................................... 49.99 — 30.93 —
(b) Equity Shares - Associates [Note 1(c) & Note 25] ................. 50.09 — 47.89 —
(c) Preference Shares .................................................................. 44.35 — 31.86 —
144.43 — 110.68 —

Quoted :
(a) Equity Shares ......................................................................... 8.85 — 18.99 —
(b) Equity Shares - Associates [Note 1(c) & Note 25] ................. 31.88 — 22.66 —
40.73 — 41.65 —
185.16 — 152.33 —

Debentures/Bonds (Non Trade & fully paid-up) :

(a) Unquoted .............................................................................. 33.25 — — —
(b) Quoted .................................................................................. — 16.80 0.33 24.89
33.25 16.80 0.33 24.89

Other Investments :
Government Securities (including Treasury Bills) :
(a) Unquoted .............................................................................. 0.01 — 0.01 —
(b) Quoted .................................................................................. — 99.08 — 17.93
0.01 99.08 0.01 17.93
Units :
Unquoted ..................................................................................... — 1,535.37 34.22 946.23
— 1,535.37 34.22 946.23
Trust Securities :
Unquoted ..................................................................................... 1,511.14 — — —
1,511.14 — — —
Others :
Unquoted ............................................................................. 0.05 — 0.05 179.76
0.05 — 0.05 179.76
1,729.61 1,651.25 186.94 1,168.81

Total ................. 3,380.86 1,355.75

Group Share in Investments of Joint Ventures ............................. 0.44 0.94
Total ................. 3,381.30 1,356.69

Cost (Net of amounts written off) of Unquoted Investments 3,224.69 1,271.89

Cost/Carrying Value of Quoted Investments ................................. 156.61 84.80
3,381.30 1,356.69
Less : Excess of cost over fair value of Current Investments (Net) 0.04 1.97
3,381.26 1,354.72
Market value of Quoted Investments ........................................... 188.09 206.64

139
SCHEDULE VI Rupees crores

2009 2008
Current Assets, Loans and Advances :
(A) Inventories (at cost or net realisable value whichever is lower) :
(i) Finished Products produced and purchased for sale ................. 845.55 1,013.20
(ii) Contracts and Work-in-Progress ................................................. 862.64 730.01
(iii) Manufactured Components ....................................................... 55.57 48.10
(iv) Raw Materials and Bought-out Components ............................. 902.73 1,029.39
(v) Work-in-Progress – Property Development Activity and Long
Term Contracts ........................................................................... 498.36 335.42
(vi) Food, Beverages, Smokes and Operating Supplies ..................... 5.24 3.45
(vii) Stores and Spares ....................................................................... 58.20 70.20
(viii) Tools ........................................................................................... 38.58 39.68
3,266.87 3,269.45
Group Share in Inventories of Joint Ventures .................................... 4.59 5.97
Total .......... 3,271.46 3,275.42

(B) Sundry Debtors :

Unsecured unless otherwise stated :
Outstanding over six months : Considered good .............................. 427.23 393.37
: Considered doubtful ......................... 123.23 78.03
550.46 471.40
Other Debts : Considered good ........................................................ 3,122.19 3,424.74
: Considered doubtful ................................................... 3.29 1.93
3,125.48 3,426.67
3,675.94 3,898.07
Less : Unmatured Finance Charges ................................................... 94.02 66.66
Less : Provision for Doubtful Debts ................................................... 131.11 78.52
3,450.81 3,752.89
Group Share in Debtors of Joint Ventures ........................................ 19.98 14.94
Total .......... 3,470.79 3,767.83

(C) Cash and Bank Balances :

Cash, cheques and stamps on hand ................................................. 392.81 241.51
Balances with Banks :
(i) On Current Account ............................................................ 1,168.50 531.22
(ii) On Fixed Deposit Account .................................................. 1,348.95 946.65
(iii) On Margin Account ............................................................ 51.43 2.44
2,568.88 1,480.31
2,961.69 1,721.82
Group Share in Cash and Bank Balances of Joint Ventures .............. 5.82 6.17
Total .......... 2,967.51 1,727.99

140
 MAHINDRA & MAHINDRA LIMITED (CONSOLIDATED)

SCHEDULE VI (Contd.) Rupees crores

2009 2008

(D) Other Current Assets :

Interest accrued on Investments ........................................................... 2.94 4.29
Others ................................................................................................... 0.14 11.14

3.08 15.43
Group Share in Other Current Assets of Joint Ventures ....................... 0.11 0.22
Total ............. 3.19 15.65

(E) Loans and Advances :

(Unsecured, considered good unless otherwise stated) :
Bills of exchange, considered good ...................................................... 14.26 13.60
Bills of exchange, considered doubtful ................................................ 1.02 1.02
15.28 14.62
Less : Provision for Doubtful Debts ...................................................... 1.02 1.02
14.26 13.60
Advances recoverable in cash or in kind or for value to be received :
Considered good .................................................................................. 1,774.59 1,548.86
Considered doubtful ............................................................................. 79.74 78.15
1,854.33 1,627.01
Less : Provision for Doubtful Advances ................................................ 74.91 71.77
1,779.42 1,555.24
Loans against assets/Retained Interest in Securitised Assets (Secured) :
Considered good .................................................................................. 6,319.22 6,157.63
Considered doubtful ............................................................................. 678.79 545.15
6,998.01 6,702.78
Less : Provision for Doubtful Advances ................................................ 379.63 269.68
6,618.38 6,433.10
Payments towards Income Tax and Surtax (Net of provisions) ............. 336.57 98.64
Balances - Customs, Port Trust, Excise, etc. .......................................... 112.53 39.73

8,861.16 8,140.31
Group Share in Loans and Advances of Joint Ventures ....................... 0.75 1.33

Total ............. 8,861.91 8,141.64

Total ............. 18,574.86 16,928.53

141
SCHEDULE VII Rupees crores

2009 2008
Current Liabilities and Provisions :
(A) Current Liabilities :
Acceptances ....................................................................................... 354.71 354.29
Sundry Creditors :
(i) Total outstanding dues of micro and small enterprises ............. 6.76 4.97
(ii) Total outstanding dues of creditors other than micro and
small enterprises ......................................................................... 5,097.73 3,700.27
5,104.49 3,705.24
Dividend payable ............................................................................... 6.19 4.21
Balances on Directors’ Current Accounts .......................................... 2.21 2.46
Interest accrued but not due on loans .............................................. 210.10 185.93
Deposits/Advances received against hire purchase/lease agreements 53.87 56.11
Other current liabilities ...................................................................... 1,039.09 972.99
6,770.66 5,281.23
Group Share in Current Liabilities of Joint Ventures ......................... 9.30 10.01
Total .......... 6,779.96 5,291.24

(B) Provisions :
Proposed Dividends ........................................................................... 278.83 282.61
Provision for Tax on Proposed Dividend ............................................ 33.23 38.48
Provision for diminution in value of long term investments ............. 28.35 28.11
Provision for premium payable on redemption of convertible bonds 269.51 224.97
Provision for compensated absences ................................................. 466.92 388.93
Provision for Estimated Loss/Expenses on Securitisation ................... 137.62 93.19
Provision : Others [Note 15] .............................................................. 400.45 334.10
1,614.91 1,390.39
Group Share in Provisions of Joint Ventures ..................................... 0.84 0.63
Total .......... 1,615.75 1,391.02
Total .......... 8,395.71 6,682.26

SCHEDULE VIII Rupees crores

2009 2008
Miscellaneous Expenditure
(to the extent not written off or adjusted) :
(a) Finance Charges ......................................................................... 15.38 5.73
(b) Separation and other costs ........................................................ 0.86 7.99
(c) Others .................................................................................... 0.62 0.46

Total .......... 16.86 14.18

142
 MAHINDRA & MAHINDRA LIMITED (CONSOLIDATED)

SCHEDULE IX Rupees crores

2009 2008
Income from Operations :
Income from services rendered ......................................................... 5,718.51 4,759.09
Income from long term contracts ..................................................... 159.57 158.58
Income from Project Management, etc. ........................................... 1.56 0.38
Hire Purchase income, Lease income and other rentals .................... 161.24 38.39
Income from Loan, Retained Interest in securitised assets and
securitisation ..................................................................................... 1,373.41 1,198.81
Commission ....................................................................................... 16.98 14.91
Rent received ..................................................................................... 6.26 3.69
Miscellaneous Income ....................................................................... 323.91 387.72
Profit on sale of Fixed assets (Net) .................................................... — 21.10
7,761.44 6,582.67
Group Share in Joint Ventures .......................................................... 8.46 9.85
Total .......... 7,769.90 6,592.52

SCHEDULE X Rupees crores

2009 2008
Other Income :
Profit on sale of Investments (Net) [Note 21 (b)] .............................. 47.78 180.00
Dividends on other Investments [Note 21 (a)] .................................. 100.94 50.73
Miscellaneous Income ....................................................................... 14.69 2.55
163.41 233.28
Group Share in Joint Ventures .......................................................... 0.05 0.01
Total .......... 163.46 233.29

SCHEDULE XI Rupees crores

2009 2008
Raw Materials, Finished and Semi-Finished Products :
(A) (Increase)/Decrease in Stock of Finished Goods, Work-in-Progress
and Manufactured Components :
Opening Stock :
(i) Finished Products produced and purchased for sale ................. 1,013.20 786.54
(ii) Contracts and Work-in-Progress ................................................. 730.01 279.94
(iii) Manufactured Components ....................................................... 48.10 45.00
1,791.31 1,111.48
Add : Stock taken over on acquisition
(i) Finished Products produced and purchased for sale ................. 1.79 38.70
(ii) Contracts and Work-in-Progress ................................................. 149.73 18.02
151.52 56.72
Less : Closing Stock :
(i) Finished Products produced and purchased for sale ................. 845.55 1,013.20
(ii) Contracts and Work-in-Progress ................................................. 862.64 730.01
(iii) Manufactured Components ....................................................... 55.57 48.10
1,763.76 1,791.31
(Increase)/Decrease in Stock .............................................................. 179.07 (623.11)
(B) Consumption of Raw Materials and Bought-out Components :
Opening Stock ................................................................................... 1,029.39 794.57
Add : Purchases ................................................................................. 11,801.58 11,242.45
12,830.97 12,037.02
Add : Stock taken over on acquisition .............................................. 7.52 72.11
Less : Closing Stock ........................................................................... 902.73 1,029.39
11,935.76 11,079.74
(C) Purchases of Finished Products for sale ........................................... 922.23 1,145.22
13,037.06 11,601.85
Group Share in Joint Ventures .......................................................... 26.73 27.30
Total ................... 13,063.79 11,629.15

143
SCHEDULE XII Rupees crores
2009 2008
Personnel :

Salaries, Wages, Bonus, etc. .............................................................. 3,736.92 3,180.42

Contribution to Provident and other funds ....................................... 262.58 210.93

Welfare .............................................................................................. 269.09 232.26

4,268.59 3,623.61

Group Share in Joint Ventures .......................................................... 6.27 6.51

Total .......... 4,274.86 3,630.12

SCHEDULE XIII Rupees crores

2009 2008
Interest, Commitment and Finance Charges :

On Term Loans and Debentures ........................................................ 730.91 571.33

On Others (Net) ................................................................................. 105.68 125.26
Finance charges ................................................................................. 21.17 18.84

857.76 715.43
Group Share in Joint Ventures .......................................................... 0.13 0.14

Total .......... 857.89 715.57

Less : Interest Income :

Interest on Government Securities, Debentures and Bonds - Gross 2.83 2.38
Interest - Others - Gross .......................................................... 104.60 123.16

107.43 125.54
Group Share in Joint Ventures .......................................................... 0.30 0.51
Total .......... 107.73 126.05
750.16 589.52

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 MAHINDRA & MAHINDRA LIMITED (CONSOLIDATED)

SCHEDULE XIV Rupees crores

2009 2008
Other Expenses :
Stores consumed ............................................................................... 181.57 172.78
Tools consumed ................................................................................. 68.87 38.46
Power and Fuel .................................................................................. 471.40 437.95
Rent including lease rentals ............................................................... 240.23 184.46
Rates and Taxes ................................................................................. 5.37 74.15
Insurance ........................................................................................... 57.49 46.13
Repairs and Maintenance :
Buildings ..................................................................................... 29.55 29.36
Machinery ................................................................................... 191.82 190.91
Others ........................................................................................ 66.94 61.52
288.31 281.79
Postage, Telephone and Communication .......................................... 131.07 133.73
Software Charges .............................................................................. 68.15 97.80
Legal and Professional Charges ......................................................... 200.30 160.85
Advertisement .................................................................................... 203.98 207.44
Commission on sales/contracts (Net) ................................................. 132.53 165.92
Discount allowed ............................................................................... 72.87 24.76
Freight outward ................................................................................. 718.36 568.57
Sales Promotion Expenses ................................................................. 351.51 268.21
Travelling Expenses ............................................................................ 487.15 662.67
Cost of Projects, Property etc. ........................................................... 145.88 466.06
Subcontracting Charges .................................................................... 770.21 547.50
Miscellaneous Expenses ..................................................................... 1,070.01 699.23
Amortisation of expenses .................................................................. 1.19 0.78
Directors’ fees .................................................................................... 0.09 0.10
Donations and contributions ............................................................. 16.89 16.46
Loss on Fixed Assets sold/scrapped/written off (Net) ........................ 6.04 —
Provision for diminution in value of Long Term investments (Net) ... 0.24 4.33
Net (Increase)/Decrease of cost over fair value of current investments (1.93) (1.74)
Provision for doubtful debts/advances (Net) ..................................... 165.68 106.87
5,853.46 5,365.26
Group Share in Joint Ventures .......................................................... 5.50 8.37
Total .......... 5,858.96 5,373.63

145
SCHEDULE XV
Notes on the Consolidated Accounts for the year ended 31st March, 2009
1. The Consolidated Financial Statements relate to Mahindra & Mahindra Limited (M&M, the Company) and its subsidiaries, joint ventures and
associates. The Consolidated Financial Statements have been prepared in accordance with Accounting Standard 21 (AS 21) “Consolidated
Financial Statements”, Accounting Standard 23 (AS 23) “Accounting for Investment in Associates in Consolidated Financial Statements” and
Accounting Standard 27 (AS 27) “Financial Reporting of Interests in Joint Ventures” notified by the Companies (Accounting Standard) Rules,
2006. The Consolidated Financial Statements have been prepared on the following basis :
(a) Investments in Subsidiaries :
i) The Financial Statements of the Company and its subsidiary companies have been combined on a line by line basis by adding together
the book values of like items of assets, liabilities, income and expenses. Intra group balances, intra group transactions and unrealised
profits or losses have been fully eliminated.
ii) The difference between the costs of investment in the subsidiaries over the Company’s portion of equity of the subsidiary is recognised
in the financial statements as Goodwill or Capital Reserve.
iii) The difference between the proceeds from disposal of investment in a subsidiary and the carrying amount of its assets less liabilities as
of date of disposal is recognised in the Profit and Loss Account as profit or loss on disposal of investment in subsidiary.
iv) Minority Interest in the net assets of consolidated subsidiaries consists of :
a) the amount of equity attributable to minorities at the date on which investment in a subsidiary is made; and
b) the minorities’ share of movements in equity since the date the parent subsidiary relationship comes into existence.
v) The Financial Statements of the subsidiaries are drawn up to 31st March, 2009.
The subsidiaries (which along with Mahindra & Mahindra Limited, the parent, constitute the group) considered in the presentation of these
consolidated financial statements are :

Proportion of Proportion of Voting

Country of ownership interest Power where different
Name of the Subsidiary Company
Incorporation as at as at as at as at
31-03-2009 31-03-2008 31-03-2009 31-03-2008

Indian Subsidiaries

Mahindra First Choice Wheels Limited

(formerly known as FirstChoice Wheels Limited) * India 54.83% 75.89% — —

Mahindra Life Space Developers Limited India 51.08% 51.08% — —

Mahindra Consulting Engineers Limited India 51.00% 51.00% — —

Tech Mahindra Limited India 48.83% 48.97% 52.33% 52.49%

Bristlecone India Limited India 82.05% 82.08% 100.00% 100.00%

Mahindra Engineering and Chemical Products Limited India 100.00% 100.00% — —

Mahindra Gujarat Tractor Limited India 60.00% 60.00% — —

Mahindra Holdings and Finance Limited

(upto 31st January, 2008) [Note 3(iv)] India — 100.00% — —
Mahindra Holidays and Resorts India Limited * India 95.29% 95.99% — —
Mahindra Infrastructure Developers Limited India 40.87% 40.87% 80.00% 80.00%
Mahindra Intertrade Limited India 100.00% 100.00% — —
Mahindra Logisoft Business Solutions Limited India 100.00% 100.00% — —
Mahindra & Mahindra Financial Services Limited * India 60.85% 61.12% — —
Mahindra Steel Service Centre Limited India 61.00% 61.00% — —
Mahindra Shubhlabh Services Limited India 83.05% 77.31% — —
NBS International Limited India 100.00% 100.00% — —

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 MAHINDRA & MAHINDRA LIMITED (CONSOLIDATED)

Proportion of Proportion of Voting

Country of ownership interest Power where different
Name of the Subsidiary Company
Incorporation as at as at as at as at
31-03-2009 31-03-2008 31-03-2009 31-03-2008

Mahindra Insurance Brokers Limited India 60.85% 61.12% 100.00% 100.00%

Mahindra Engineering Services Limited

(formerly known as Mahindra Engineering Design and

Development Company Limited) India 100.00% 100.00% — —

Mahindra World City Developers Limited India 42.21% 42.21% 82.62% 82.62%

Mahindra SAR Transmission Private Limited India 100.00% 60.26% — —

Mahindra Navistar Automotives Limited

(formerly known as Mahindra International Limited) India 51.00% 51.00% — —

Mahindra World City (Maharashtra) Limited India 51.08% 51.08% 100.00% 100.00%

Mahindra Renault Private Limited India 51.00% 51.00% — —

Mahindra Ugine Steel Company Limited India 50.69% 50.69% — —

Mahindra World City (Jaipur) Limited India 37.80% 37.80% 74.00% 74.00%
st
Tech Mahindra (R & D Services) Limited (upto 31 March, 2008) India — 48.97% — 100.00%

CanvasM Technologies Limited India 39.11% 39.23% 80.10% 80.10%

iPolicy Networks Limited (upto 31st March, 2008) India — 48.97% — 100.00%

Mahindra Hinoday Industries Limited * India 64.88% 43.08% 99.81% 66.28%

Mahindra Integrated Township Limited India 48.77% 48.78% 100.00% 100.00%

Mahindra Vehicle Manufacturers Limited

(formerly known as Mahindra Automotive Limited) India 100.00% 100.00% — —

Mahindra Castings Private Limited India 65.00% 65.00% — —

Mahindra Forgings Limited India 60.56% 60.56% — —

Mahindra Hotels and Residences India Limited India 95.28% 95.98% 99.99% 99.99%

Mahindra Retail Private Limited

(upto 15th January, 2009) [Note 19] India — 100.00% — —

Mahindra Knowledge City Limited

(Formarly known as Mahindra Technology Park Limited) India 51.08% 51.08% 100.00% 100.00%

Mahindra Holdings Limited India 100.00% 100.00% — —

Mahindra Logistics Limited India 100.00% 100.00% — —

Mahindra Rural Housing Finance Limited India 53.25% 61.12% 87.50% 100.00%

Punjab Tractors Limited (upto 31st July, 2008) [Note 3(v)] India — 64.64% — —

Mahindra Residential Developers Limited India 24.87% 48.77% 51.00% 100.00%

Mahindra Aerospace Private Limited India 100.00% 100.00% — —

Mahindra First Choice Services Limited India 100.00% 100.00% — —

Mahindra Navistar Engines Private Limited India 51.00% 51.00% — —

rd
Mahindra Bebanco Developers Limited (w.e.f. 3 June, 2008) India 35.76% — 70.00% —
nd
Mahindra Industrial Township Limited (w.e.f. 2 July, 2008) India 51.08% — 100.00% —

Crest Geartech Limited (w.e.f. 3rd July, 2008) India 51.00% — 100.00% —

147
 Proportion of Proportion of Voting
Country of ownership interest Power where different
Name of the Subsidiary Company
Incorporation as at as at as at as at
31-03-2009 31-03-2009 31-03-2009 31-03-2008

Mahindra IT Consulting Private Limited

(w.e.f 16th September, 2008) India 82.05% — 100.00% —
th
Mahindra Two Wheelers Limited (w.e.f. 29 September, 2008) India 80.00% — — —
Mahindra United Football Club Private Limited
(w.e.f. 3rd November, 2008) India 100.00% — — —

Mahindra Defence Land Systems Private Limited

(w.e.f. 4th March, 2009) India 100.00% — — —
th
Venturbay Consultants Private Limited (w.e.f. 19 March, 2009) India 48.83% — 100.00% —
Foreign Subsidiaries

Bristlecone Limited Cayman Islands 82.05% 82.08% — —

Mahindra (China) Tractor Company Limited China 84.87% 83.74% — —

Tech Mahindra (Beijing) IT Services Limited China 48.83% 48.97% 100.00% 100.00%

Tech Mahindra GmbH Germany 48.83% 48.97% 100.00% 100.00%

Bristlecone GmbH Germany 82.05% 82.08% 100.00% 100.00%

Plexion Technologies GmbH Germany 100.00% 100.00% — —

Mahindra Forgings Europe AG Germany 60.56% 60.56% 100.00% 100.00%

Gesenkschmiede Schneider GmbH Germany 60.56% 60.56% 100.00% 100.00%

JECO-Jellinghaus GmbH Germany 60.56% 60.56% 100.00% 100.00%

Falkenroth Umformtechnik GmbH Germany 60.56% 60.56% 100.00% 100.00%
Schöneweiss & Co. GmbH ** Germany 60.56% 60.56% 97.28% 97.28%

MHR Hotel Management GmbH Germany 71.47% 71.99% 75.00% 75.00%

PT Tech Mahindra Indonesia Indonesia 48.83% 48.97% 100.00% 100.00%

Mahindra Europe s.r.l. Italy 80.00% 80.00% — —

Mahindra Graphic Research Design s.r.l. Italy 100.00% 100.00% — —

Bristlecone (Malaysia) SDN. BHD Malaysia 82.05% 82.08% 100.00% 100.00%

Tech Mahindra (Malaysia) SDN. BHD. Malaysia 48.83% 48.97% 100.00% 100.00%

Heritage Bird (M) SDN. BHD. Malaysia 95.29% 95.99% 100.00% 100.00%

Mahindra Overseas Investment Company (Mauritius) Limited Mauritius 100.00% 100.00% — —

Mahindra-BT Investment Company (Mauritius) Limited Mauritius 57.00% 57.00% — —

Mahindra Forgings International Limited Mauritius 60.56% 60.56% 100.00% 100.00%

Mahindra Forgings Global Limited Mauritius 60.56% 60.56% 100.00% 100.00%

Mahindra Middleeast Electrical Steel Service Centre (FZC) Sharjah 90.00% 90.00% — —
Tech Mahindra (Singapore) Pte. Limited Singapore 48.83% 48.97% 100.00% 100.00%

Bristlecone (Singapore) Pte. Limited Singapore 82.05% 82.08% 100.00% 100.00%

Mahindra & Mahindra South Africa (Proprietary) Limited South Africa 90.73% 51.00% — —

Tech Mahindra (Thailand) Limited Thailand 48.83% 48.97% 100.00% 100.00%

Bristlecone UK Limited U.K. 82.05% 82.08% 100.00% 100.00%

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 MAHINDRA & MAHINDRA LIMITED (CONSOLIDATED)

Proportion of Proportion of Voting

Country of ownership interest Power where different
Name of the Subsidiary Company
Incorporation as at as at as at as at
31-03-2009 31-03-2008 31-03-2009 31-03-2008

Stokes Group Limited U.K. 60.43% 60.43% 99.78% 99.78%

Stokes Forgings Dudley Limited U.K. 60.43% 60.43% 100.00% 100.00%

Jensand Limited U.K. 60.43% 60.43% 100.00% 100.00%

Stokes Forgings Limited U.K. 60.43% 60.43% 100.00% 100.00%

Mahindra Engineering Services (Europe) Limited

(formerly known as Plexion Technologies (UK) Limited) U.K. 100.00% 100.00% — —

Tech Mahindra (Americas) Inc. U.S.A. 48.83% 48.97% 100.00% 100.00%

Mahindra USA Inc. U.S.A. 100.00% 100.00% — —

Bristlecone Inc. U.S.A. 82.05% 82.08% 100.00% 100.00%

Mahindra Holidays and Resorts USA Inc. U.S.A. 95.29% 95.99% 100.00% 100.00%

Tech Mahindra (R & D Services) Inc. (upto 30th June, 2008) U.S.A. — 48.97% — 100.00%

Mahindra Technologies Inc

(formerly known as Plexion Technologies Inc) U.S.A. 100.00% 100.00% — —

CanvasM (Americas) Inc. U.S.A. 39.11% 39.23% 100.00% 100.00%

Mahindra Automotive Australia Pty. Limited

(w.e.f. 23rd September, 2008) Australia 80.00% — — —

Mahindra Yueda (Yancheng) Tractor Company Limited

(w.e.f. 28th November, 2008) China 51.00% — — —

Mahindra Gears Cyprus Limited (w.e.f. 6th June, 2008)

(formerly known as Kalbarri Trading Limited) Cyprus 53.34% — 100.00% —

Mahindra Metal Castello S.r.l. (w.e.f. 17th June, 2008) Italy 51.00% — 95.61% —
rd
Metalcastello S.p.A (w.e.f. 3 July, 2008) Italy 51.00% — 100.00% —

Engines Engineering S.r.l. (w.e.f. 5th August, 2008) Italy 70.00% — — —

EFF Engineering S.r.l. (w.e.f. 5th August, 2008) Italy 35.70% — 51.00% —

ID-EE S.r.l. (w.e.f. 5th August, 2008) Italy 49.00% — 70.00% —

th
Mahindra Gears International Limited (w.e.f. 10 June, 2008) Mauritius 100.00% — — —

Mahindra Gears Global Limited (w.e.f. 6th June, 2008)

(formerly known as Iven International Gear Mauritius Limited) Mauritius 53.34% — — —

* excluding shares issued to ESOP Trust but not allotted to employees as per the Guidance Note on Accounting for Employee Share-based
Payments issued by The Institute of Chartered Accountants of India.
** includes fundamental economic rights and administrative rights (including but not limited to voting rights, information rights and right
to participate in shareholders meetings) in respect of 2.72% shares.
Note : Tech Mahindra Foundation is not consolidated as a subsidiary as it can apply its income for charitable objects only and cannot pay
dividend or transfer funds to its parent.

149
 (b) Interests in Joint Ventures
The Group’s interests in jointly controlled entities of the Group are :

Name of the Entity Country of Percentage of Percentage of

Incorporation ownership ownership
interest interest
as at 31-03-2009 as at 31-03-2008

a) Mahindra Sona Limited India 29.77% 29.77%

b) PSL Erickson Limited India 18.06% 18.06%
c) Mahindra Water Utilities Limited $ India 50.00% 50.00%
d) Mahindra Inframan Water Utilities Private Limited $ India 50.00% 50.00%
Interest in Joint Ventures are accounted for using Proportionate Consolidation Method.
$ Shareholding is through a subsidiary, Mahindra Infrastructure Developers Limited
The Financial Statements of all the Joint Ventures are drawn upto 31st March, 2009.

(c) Investment in Associates

The Group’s Associates are :

Name of the Entity Country of Percentage of Percentage of

Incorporation ownership ownership
interest interest
as at 31-03-2009 as at 31-03-2008

Owens Corning (India) Limited India 21.50% 21.50%

Mahindra Construction Company Limited India 43.83% 43.83%
Officemartindia.com Limited India 50.00% 50.00%
Rathna Bhoomi Enterprises Private Limited India 20.43% 20.43%
Kota Farm Services Limited India 37.37% 34.79%
Mriyalguda Farm Solution Limited India 37.37% 34.79%
Mega One Stop Farm Services Limited India 37.37% 34.79%
Mahindra Composites Limited India 30.56% 30.56%
Swaraj Automotives Limited India 44.19% 35.64%
Swaraj Engines Limited India 33.22% 21.49%
th
Eco Engines (w.e.f. 5 August, 2008) Russia 29.75% -

The financial statements of all the Associates are drawn up to 31st March, 2009.
2. Accounting Policies :
(A) Fixed Assets :
(a) (i) Fixed Assets are carried at cost less depreciation except as stated in (iii) below. Cost includes financing cost relating to borrowed
funds attributable to the construction or acquisition of qualifying fixed assets upto the date the asset is ready for use.
(ii) When an asset is scrapped or otherwise disposed off, the cost and related depreciation are removed from the books of account
and resultant profit (including capital profit) or loss, if any, is reflected in the Profit and Loss Account.
(iii) Land and Buildings, of the parent company had been revalued as at 31st October, 1984 at depreciated replacement values on the
basis of a valuation made by a firm of Chartered Surveyors and Valuers. The indices, if any, used are not stated in the valuation.
(b) (i) Leasehold land is amortised over the period of the lease.
(ii) Depreciation on fixed assets is provided on Straight Line Method over useful life estimated by management or on the basis of
depreciation rates prescribed under respective local laws.
(iii) Depreciation charge for each year is after deducting the amount representing the depreciation on the increase due to revaluation
of Land and Buildings, transferred from the Revaluation Reserve.

150
 MAHINDRA & MAHINDRA LIMITED (CONSOLIDATED)

(B) Intangible Assets :

All Intangible Assets are initially measured at cost and amortised so as to reflect the pattern in which the asset’s economic benefits are
consumed :
(a) Technical Knowhow :
The expenditure incurred is amortised over the estimated period of benefit, not exceeding six years commencing with the year of
purchase of the technology.
(b) Development Expenditure :
The expenditure incurred on technical services and other project related expenses are amortised on the completion of the development
work over the estimated period of benefit not exceeding five years.
(c) Software Expenditure :
The expenditure incurred is amortised over three financial years equally commencing from the year in which the expenditure is
incurred.
(d) Websites :
The expenditure incurred is amortised over the estimated period of benefit, not exceeding five years.
(e) Timeshare Weeks :
Intangible assets representing ‘timeshare weeks’ are amortised over a period of ten years.
(f) Trademarks :
The expenditure incurred is amortised over the estimated period of benefit, not exceeding ten years.
(g) Non-Compete Fees :
Non-compete payments are amortised equally over the estimated period of benefit, not exceeding ten years.
(C) Investments :
All long term investments, other than in Associates, are carried at cost. However, provision for diminution in value is made to recognise a
decline other than temporary, in the value of investments. Current investments are valued at the lower of cost and fair value, determined by
category of investment. Investments in Associates are accounted using the equity method.
(D) Inventories :
Inventories are stated at cost or net realisable value, whichever is lower. Cost is arrived at on a weighted average method and includes,
where appropriate, manufacturing overheads and excise duty. Cost of the inventory, includes interest, where appropriate, for long term
projects.
(E) Miscellaneous Expenditure (to the extent not written off or adjusted) :
Expenditure carried forward under this head is amortised as follows :
(a) Finance Charges :
The expenditure incurred in raising long term borrowings is amortised over the period of the borrowings. On early buyback,
conversion or repayment of borrowings, any unamortised expenditure is fully written off in that year.
(b) Separation and Other Costs :
Special Payments/Pensions under Voluntary Retirement Schemes.
The liability is amortised by the year ending March, 2010 from the month in which the liability is incurred.
(F) Foreign Exchange Transactions :
Transactions in foreign currencies are recorded at the exchange rates prevailing on the date of transaction. Monetary items are translated at
the year-end rates. The exchange difference between the rate prevailing on the date of transaction and on the date of settlement as also on
translation of monetary items at the end of the year (other than those relating to long term foreign currency loan used for financing the
acquisition of fixed assets) is recognised as income or expense, as the case may be.
Exchange differences relating to long term monetary items, to the extent they are used for financing the acquisition of fixed assets are
added to or subtracted from the cost of such fixed assets and the balance accumulated in ‘Foreign Currency Monetary Item Translation
Difference Account’ and amortised over the balance term of the long term monetary item or 31st March, 2011 whichever is earlier.
Any premium or discount arising at the inception of a forward exchange contract is recognised as income or expense over the life of the
contract, except in the case where the contract is designated as a cash flow hedge.
(G) Derivative instruments and hedge accounting :
The Company uses foreign currency forward contracts and currency options to hedge its risks associated with foreign currency fluctuations
relating to certain firm commitments and highly probable forecast transactions. The Company does not hold derivative financial instruments

151
 for speculative purposes. The Company has applied to such contracts the hedge accounting principles set out in Accounting Standard 30
“Financial Instruments : Recognition and Measurement” (AS 30) by marking them to market.

Changes in the fair value of the contracts that are designated and effective as hedges of future cash flows are recognised directly in
Hedging Reserve Account and the ineffective portion is recognised immediately in the Profit and Loss Account.

(H) Revenue Recognition :

(a) Sales of products and services are recognised when the products are shipped or services rendered. Income from long term contracts
and sale of property (concerning property development activity) is, accounted for on percentage of completion basis. [Refer paragraph
(I) below]

(b) Dividends from investments are recognised in the Profit and Loss Account when the right to receive payment is established.

(I) Long term contracts and Property Development Activity :

Income on long term contracts and property development activity is accounted on the percentage of completion basis which necessarily
involves technical estimates of the percentage of completion of each contract/activity, and costs to completion of the contract/activity, on
the basis of which profits/losses are accounted. Such estimates, made by the management and certified to the auditors, have been relied
upon by them, as these are of a technical nature.

Project management fees receivable on fixed period contracts are accounted over the tenure of the contract/agreement. Where the
management fee is linked to the input costs, revenue is recognised as a proportion of the work completed based on progress claim
submitted. Where the management fees are linked to the revenue generation from the project, revenue is recognised on the percentage of
completion basis.

(J) Income from Lease/Hire Purchase :

Finance earnings on lease transactions are calculated by applying the interest rate implicit in the lease, to the investment in the leased
assets, as reduced by the net present value of the lease instalments falling due.

Income from hire purchase contracts entered prior to 1st April, 2001 is accounted for on equated basis in accordance with the terms of the
contract (except in some cases in which it is accounted for by applying the interest rate implicit in such contracts). For hire purchase
transactions entered on or after 1st April, 2001 the income is accounted for by applying the interest rate implicit in such contracts.

(K) Government Grants :

The Company is entitled to various incentives from a State Government, such as grants by way of refund of octroi duty paid by the
Company for its manufacturing unit located in a developing region. In view of the uncertainty in respect to the collection of these grants,
such grants are accounted for as and when the disbursements are received.

(L) Timeshare Business :

The activity of selling Timeshare and providing holiday facilities to members for a specified period each year, over a number of years, for
which membership fee is collected either in full up front, or on a deferred payment basis. Upto 30th September, 2005 out of the total
membership fee, relevant portion reasonably attributable towards cost required to market Timeshare, which is assessed and revised
periodically, is recognised as Timeshare income in the year in which the purchaser of Timeshare becomes a member and the balance
representing ‘Advance towards members’ facilities’ is being recognised as Timeshare income equally over a period for which holiday
facilities are provided commencing from the year in which the member is entitled to benefits of membership under the scheme.

With effect from 1st October, 2005 in accordance with the new membership rules, admission fee, which is non-refundable, is recognised as
income on admission of a member. Entitlement fee, which entitles the Timeshare member for the Timeshare facilities over the membership
usage period, is recognised as income equally over the usage period.

(M) Employee Benefits :

Defined Contribution Plan/Defined Benefit Plan/Long term compensated absences.

Group’s contributions paid/payable during the year to Superannuation Fund, ESIC and Labour Welfare Fund are recognised in the Profit and
Loss Account.

Contributions to Provident Fund are made to a Trust administered by the Group and are charged to Profit and Loss account as incurred.

The Company is liable for the contribution and any shortfall in interest between the amount of interest realised by the investment and the
interest payable to members at the rate declared by the Government of India.

Group’s liability towards gratuity, long term compensated absences and post retirement medical benefit schemes are determined by
independent actuaries, using the projected unit credit method. Past services are recognised on a straight line basis over the average period
until the benefits become vested. Actuarial gains and losses are recognised immediately in the statement of Profit and Loss Account as
income or expense. Obligation is measured at the present value of estimated future cash flows using a discounted rate that is determined
by reference to the market yields at the Balance Sheet date on Government Bonds where the currency and terms of the Government Bonds
are consistent with the currency and estimated terms of the defined benefit obligation.

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 MAHINDRA & MAHINDRA LIMITED (CONSOLIDATED)

(N) Borrowing Costs :

All borrowing costs are charged to the Profit and Loss Account other than :

(a) Borrowing costs that are attributable to the acquisition or construction of assets that necessarily take a substantial period of time to
get ready for their intended use. These are capitalised as part of the cost of such assets.

(b) Expenses incurred on raising long term borrowings which are amortised over the period of borrowings. On early buyback, conversion
or repayment of borrowings, any unamortised expenditure is fully written off in that year.

(O) Redemption Premium :

Premium payable on redemption of Bonds/Debentures is fully provided and charged to Securities Premium Account (Net of Tax) in the year
of issue.

(P) Product Warranty :

In respect of warranties on sale of certain products, the estimated costs of these warranties are accrued at the time of sale. The estimates
for accounting of warranties are reviewed and revisions are made as required.

(Q) Leases :

The Group’s significant leasing arrangements are in respect of operating leases for premises (residential, office, stores, godowns, etc.). The
leasing arrangements which are not non-cancellable range between 11 months and three years generally, and are usually renewable by
mutual consent on agreed terms. The aggregate lease rentals payable are charged as Rent including lease rentals.

(R) Segment Reporting :

The accounting policies adopted for segment reporting are in line with the accounting policies of the Group. Segments are identified
having regard to the dominant source and nature of risks and returns and internal organisation and management structure.

Revenues and expenses have been identified to the segments based on their relationship to the business activity of the segment.

Income/Expenses relating to the enterprise as a whole and not allocable on a reasonable basis to business segments are reflected as
unallocated corporate income/expenses. Inter-segment transfers are at prices which are generally market led.

(S) Taxes on Income :

Current tax is determined as the amount of tax payable in respect of taxable income for the year. Deferred tax is recognised, subject to
consideration of prudence, on timing differences, being the difference between taxable income and accounting income that originate in
one period and are capable of reversal in one or more subsequent periods. Deferred tax assets arising on account of unabsorbed
depreciation or carry forward of tax losses are recognised only to the extent that there is virtual certainty supported by convincing evidence
that sufficient future tax income will be available against which such deferred tax assets can be realised.

(T) Income from Securitisation and Assignment :

Securitised assets are derecognised as the contractual rights therein are transferred to the special purpose vehicle or buyers as the case may
be. On derecognition, the difference between book value of the securitised asset and consideration received as reduced by the estimated
provision for loss/expense and incidental expenses related to the transaction is recognised as gain or loss arising on securitisation.

In case of assignment of receivables the assets are derecognised as all the rights, titles, future receivables and interest thereof are assigned
to the purchaser. On derecognising, the difference between book value of the receivables assigned and consideration received as reduced
by the estimated provision for loss/expenses and incidental expenses related to the transaction is recognised as gain or loss arising on
assignment.

3. Changes in Group Structure : During the year ended 31st March, 2009, the following changes in Group structure have taken place and the same
have been appropriately dealt with in the Consolidated Financial Statements.

i. Tech Mahindra (R&D Services) Ltd (TMRD) and iPolicy Networks Ltd (IPNL) : In accordance with a scheme of amalgamation sanctioned by
the Hon’ble High Courts of Judicature, Bombay, Karnataka and Delhi vide their orders dated 28th March, 2008, 3rd April, 2008 and
4th April, 2008 respectively, TMRD and IPNL both wholly owned subsidiaries of Tech Mahindra Ltd (TML), have merged with effect from
1st April, 2008, the appointed date, with TML, an existing subsidiary of the Company.

ii. Tech Mahindra (R&D Services) Inc. (TMRDUS) : In accordance with an approved plan and agreement from amalgamation TMRDUS has
merged with Tech Mahindra (Americas) Inc, also a subsidiary of the Company. The amalgamation has been duly authorised in compliance
with the jurisdictional laws. Accordingly, TMRDUS ceased to exist on 1st July, 2008.

iii. Stokes Group Ltd (SGL) : In accordance with an Asset Purchase Agreement entered into by Stokes Forgings Limited (SFL), Stokes Forgings
Dudley Limited (SFDL) and Jensand Limited (Jensand) with SGL, the trade and assets of SFL, SFDL and Jensand were transferred at their
respective book values to SGL with effect from 1st April, 2008.

iv. Mahindra Holdings and Finance Ltd (MHFL) : In accordance with a scheme of amalgamation sanctioned by the Hon’ble High Court of
Judicature, Bombay vide its order dated 18th July, 2008, the Company’s wholly owned subsidiary MHFL has merged with the Company with
effect from 1st February, 2008, the appointed date.

153
 v. Punjab Tractors Limited (PTL): In accordance with a scheme of amalgamation sanctioned by the Hon’ble High Court of Judicature, Bombay
and the Hon’ble High Court of Punjab & Haryana, Chandigarh vide their orders dated 9th Juanuary, 2009 and 16th January, 2009
respectively, the Company’s subsidiary PTL has merged with the Company with effect from 1st August, 2008, the appointed date.
vi. Mahindra Hinoday Industries Ltd (MHIL) : In terms of the proposed Scheme of Amalgamation of the Company’s subsidiaries Mahindra
Castings Private Ltd (MCPL) and MHIL, a subsidiary of MCPL, the merger would be operative, pending statutory approvals, with effect from
1st April, 2008. Pending the approvals, MHIL, an existing subsidiary has been considered to be a subsidiary as on the Balance Sheet date
and the results of MHIL for the period ended 31st March, 2009 have been considered in the Consolidated Financial Statements.
4. Scheme of Amalgamations :
(a) Pursuant to the Scheme of Amalgamation (the scheme) of Mahindra Holdings and Finance Limited (MHFL), a wholly owned subsidiary of
the Company, with the Company as sanctioned by the Hon’ble High Court of Bombay vide its order dated 18th July, 2008 :
(i) the entire business and all the assets and liabilities, duties and obligations of MHFL were transferred to and vested in the Company,
from 1st February, 2008 (the appointed date), at their book values; and
(ii) the excess of the value of net assets of MHFL over the face value of companies shares allotted, the face value of the MHFL shares
cancelled and the amount of General Reserve and Profit and Loss Account of MHFL, amounting to Rs.129.61 crores, has been credited
to the Investment Fluctuation Reserve Account.
Had the scheme not prescribed the above treatment the General Reserve would have been higher by Rs.129.61 crores and the Investment
Fluctuation Reserve Account would have been lower by the same amount.
(b) Pursuant to the Scheme of Amalgamation (the scheme) of Punjab Tractors Limited (PTL) a subsidiary of the Company, with the Company
sanctioned by the Hon’ble High Court of Bombay and the Hon’ble High Court of Punjab & Haryana vide their orders dated 9th January,
2009 and 16th January, 2009 respectively :
(i) the entire business and all the assets and liabilities, duties and obligations of PTL were transferred to and vested in the Company, at
their book values from 1st August, 2008 (the appointed date); and
(ii) the excess of the value of net assets of PTL over the face value of shares allotted, amounting to Rs. 677.00 crores, has been credited
to the Investment Fluctuation Reserve Account.
Had the scheme not prescribed the above treatment the General Reserve and the Profit and Loss Account of the Company would have been
higher by Rs. 646.70 crores and Rs. 30.00 crores respectively, there would have been a Preference Share Redemption Reserve of Rs. 0.30
crores and the Investment Fluctuation Reserve Account would have been lower by Rs. 677.00 crores.
(c) In accordance with the above schemes of arrangement as well as the Scheme of Arrangement approved by the the Hon’ble High Court of
Bombay on 12th December, 2003, the Investment Fluctuation Reserve has been utilized to the extent of Rs. 154.38 crores (2008 : Rs. Nil),
towards diminution in the value of fixed assets.
5. The Guidance Note on Accounting for Employee Share-based Payments issued by The Institute of Chartered Accountants of India requires that
shares allotted to a trust but not transferred to employees be reduced from Share Capital and Reserves. Accordingly, the Company has reduced
the Share Capital by Rs. 3.10 crores (2008 : Rs. 3.34 crores), Securities Premium by Rs. 15.20 crores (2008 : Rs. 16.34 crores) for the 31,02,653
shares (2008 : 33,34,216 shares) held by the trust pending transfer to the eligible employees.
The Share Capital of the Company has also been reduced and the General Reserve increased by Rs. 3.10 crores (2008 : Rs. 3.33 crores) for the
bonus shares issued by the Company in September, 2005 to the trust but not yet transferred by the trust to the employees. The above monies
which is treated as advance received, is included under current liabilities.
6. Consequent to the announcement issued by The Institute of Chartered Accountants of India dated 29 th March, 2008 in respect of forward
exchange contracts and currency and interest rate swaps, the Company has applied the Hedge Accounting principles set out in the Accounting
Standard (AS) 30 “Financial Instruments : Recognition and Measurement”. Accordingly, all such contracts are marked to market and the loss
aggregating Rs. 479.90 crores (Net of Tax of Rs. 223.57 crores) [2008 : Gain of Rs. 28.78 crores (Net of Tax of Rs. 14.82 crores)] arising
consequently on contracts that were designated and effective as hedges of future cash flows has been recognised directly in the Hedging
Reserve Account.
7. In line with the notification dated 31st March, 2009 issued by the Ministry of Corporate Affairs, amending Accounting Standard AS11 –‘Effects
of Changes in Foreign Exchange Rates’, the Company has chosen to exercise the option under Para 46 inserted in the standard by the
notification.
Accordingly with retrospective effect from 1st April, 2007 exchange differences on all long term monetary items are :
(i) to the extent such items are used for financing fixed assets, added to/subtracted from the cost of those fixed assets and depreciated over
the balance useful life of the asset.
(ii) in other cases accumulated in the ‘Foreign Currency Monetary Item Translation Difference Account’ and amortised over the balance period
of such long term monetary item but not beyond 31st March, 2011.
Arising from the above the Company has :
(i) charged to the opening General Reserve Rs. 61.87 crores (Net of Tax of Rs. 21.03 crores) which was recognised in the Profit and Loss
account in previous financial year ended 31st March, 2008.
(ii) added to fixed asset/capital work-in-progress Rs. 137.73 crores and to capital work-in-progress Rs. 41.24 crores being the exchange
differences on long term monetary items relatable to the acquisition of fixed assets.
(iii) charged to the Profit and Loss account Rs. 24.61 crores.

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 MAHINDRA & MAHINDRA LIMITED (CONSOLIDATED)

(iv) carried forward Rs. 18.44 crores in the ‘Foreign Currency Monetary Item Translation Difference Account’ being the amount remaining to be
amortised as at 31st March, 2009.
As a result of the above change in Accounting Policy the net profit before tax for the year is higher by Rs. 259.28 crores (Net of Tax Rs. 171.15
crores).
8. Loans :
(a) Secured borrowings are secured by a pari-passu charge on immovable properties of the entities both present and future, subject to certain
exclusions and are also secured by pari-passu charge on the movable properties of the entities including movable machinery, machinery
spares, tools and accessories, both present and future, subject to certain exclusions.
(b) Loans and Advances from Banks are secured by a first charge on whole of the current assets namely inventories, certain book debts,
outstanding monies, receivables, claims, etc. both present and future.
9. (a) The depreciation charge for the year excludes :
i) An amount of Rs. 0.38 crores (2008 : Rs. 0.42 crores), representing depreciation on the increase due to revaluation of Land and
Buildings transferred from the Revaluation Reserve.
ii) An amount of Rs. 4.08 crores (2008 : Rs. 1.70 crores), representing depreciation on assets used for development work. This
expenditure is transferred to Development Expenditure and is appropriately amortised.
iii) An amount of Rs. 0.51 crores represents depreciation on assets of subsidiary disposed off during the year.
(b) Additions to assets include assets taken over due to acquisition of subsidiaries :
Rupees crores
Description of Assets Cost Depreciation/
Amortisation

Land ......................................................................................................................................... 9.51 -

Building .................................................................................................................................... 49.65 19.76
Plant and Machinery ................................................................................................................ 493.05 369.92
Furniture and Fittings ............................................................................................................... 10.19 9.44
Vehicles, Cycles, etc. ................................................................................................................. 2.80 1.82
Software Expenditure ............................................................................................................... 0.53 0.42
Other Intangibles ..................................................................................................................... 17.78 7.83

Total ......................................................................................................................................... 583.51 409.19

10. During the year, Mahindra & Mahindra Financial Services Limited has without recourse assigned loan receivables of 32,083 (2008 : 24,425)
contracts amounting to Rs. 1,036.23 crores (2008 : Rs. 809.86 crores) (including future interest receivable) for a consideration of
Rs. 915.11 crores (2008 : Rs. 730.31 crores) and de-recognised the assets from the books. The income booked in respect of assignment of
receivables includes certain amount towards cost of future servicing of the assigned pool and an appropriate amount has been provided
towards expenditure for future services. On assignment of receivables income is booked at Rs. 151.95 crores (2008 : Rs. 133.45 crores) and
provision for estimated loss/expenses of Rs. 54.27 crores (2008 : Rs. 32.60 crores). During the year provision in respect of securitisation of
Rs. 7.67 crores (2008 : Rs. 6.84 crores) considered no longer necessary has been written back.
11. The Company had issued during the year ended 31st March, 2007, Zero Coupon Foreign Currency Convertible Bonds (Bonds 2011) aggregating
US$ 200 million, at par. The bond holders have an option to convert these bonds into Equity Shares with full voting rights or Global Depository
Receipts (GDRs) determined at an initial conversion price of Rs. 922.04 per share with fixed exchange rate of conversion of Rs. 44.42 = US$ 1,
at any time on or after 7th May, 2006 upto 7th March, 2011.
The Bonds 2011 may be redeemed, in whole but not in part, at the option of the Company at any time on or after 13th April, 2008 subject to
satisfaction of certain conditions. Unless previously converted, redeemed or purchased and cancelled, the bonds fall due for redemption on 14th
April, 2011 at 128.03 per cent of their principal amount. Upto 31st March, 2009, none of the bonds have been converted into equity shares/
GDRs.
During the year bonds 2011 of the face value of US$ 10.50 million were bought back and cancelled.
Premium payable on redemption of Bonds 2011 had been fully provided in the previous year by debiting the same to Securities Premium
Account (SPA). Consequent to the buyback, premium aggregating Rs. 9.84 crores (Net of Tax of Rs. 5.07 crores) no longer payable has been
credited back to SPA during the year.
The net proceeds of Rs. 53.95 croees, unutilised as at 31st March, 2009, is disclosed under Cash and Bank balances.
The Company had issued during the year ended 31st March, 2009, 93,95,974 Unsecured Fully and Compulsorily Convertible Debentures (FCD’s)
having a face value of Rs. 745 per FCD for an aggregate consideration of Rs. 700 crores. The FCD’s have a tenure of 18 months and carry a
coupon rate of 9.25% until conversion or date of maturity whichever is earlier. The FCD holder has the option to convert each FCD into one
equity share of face value Rs.10 at a premium of Rs. 735, at anytime within 18 months from 28th July, 2008. Unless previously converted, each
FCD will be compulsorily converted into one equity share of Rs. 10 each at a premium of Rs. 735 on 28th January, 2010. Upto 31st March, 2009
none of the FCD’s have been converted into equity shares.

155
12. Employee Defined Benefits :
Defined benefit plans – as per Actuarial valuation on 31st March, 2009 Rupees crores
Gratuity Gratuity Post Retirement
(Funded) (Unfunded) Medical Benefits
(Unfunded)
2009 2008 2009 2008 2009 2008
A. Expense recognised in the Statement of
Profit & Loss Account for the year ended 31st March
1. Current service cost 22.19 20.65 21.60 16.39 0.23 0.21
2. Interest cost 20.57 19.99 10.59 3.22 0.25 0.29
3. Expected return on plan assets (19.82) (16.54) (0.04) — — —
4. Actuarial (Gains)/Losses 35.86 2.39 8.21 2.74 1.80 (0.70)
5. Past Service cost 0.03 0.42 0.05 0.02 — —
6. Settlement cost — — — — — —
7. Payments on account of employee transferred (0.04) (1.73) — — — —
8. Effect of the limit in Para 59(b) of the revised AS 15 (0.01) 0.01 — — — —
9. Total expense 58.78 25.19 40.41 22.37 2.28 (0.20)
B. Net Asset/(Liability) recognised in the Balance Sheet
as at 31st March
1. Present Value of Defined Benefit obligation
as at 31st March 337.58 278.71 116.27 52.75 4.99 2.95
2. Fair value of plan assets as at 31st March 230.08 217.95 0.21 — — —
3. Amount not recognised as an asset (3.92) 0.01 39.65 — — —
4. Funded status [Surplus/(Deficit)] (103.58) (60.77) (155.71) (52.75) (4.99) (2.95)
5. Net Asset/(Liability) as at 31st March (103.58) (60.77) (155.71) (52.75) (4.99) (2.95)
C. Change in the obligations during the year
ended 31st March
1. Present Value of Defined Benefit obligation at the
beginning of the year 278.71 204.46 32.04 32.04 2.95 3.30
2. Obligations arising on account of acquisitions
during the year (3.08) 45.67 0.68 0.68 — —
3. Current service cost 22.19 20.65 61.24 16.39 0.23 0.21
4. Interest cost 20.58 19.99 10.59 3.22 0.25 0.29
5. Actuarial (Gains)/Losses 35.86 2.92 8.16 2.74 1.80 (0.70)
6. Liabilities settled on sale of business — — (3.12) — — —
7. Benefits paid (12.54) (15.40) (13.70) (2.35) (0.23) (0.15)
8. Past Service Cost — 0.42 0.06 0.03 — —
9. Present Value of Defined Benefit obligation
at the end of the year 341.72 278.71 95.95 52.75 5.00 2.95
D. Change in the fair value of plan assets during the
year ended 31st March
1. Fair value of plan assets at the beginning of the year 217.95 144.67 — — — —
2. Fair value of plan assets arising on account of
acquisitions during the year (0.16) 29.37 — — — —
3. Expected return on plan assets 20.03 16.54 — — — —
4. Actuarial Gains/(Losses) 0.27 0.63 — — — —
5. Contributions by employer 10.59 39.41 2.41 2.35 0.22 0.15
6. Asset distributed on sale of business 1.76 — — — — —
7. Actual Benefits paid (11.31) (12.67) (2.41) (2.35) (0.22) (0.15)
8. Fair value of plan assets at the end of the year 239.13 217.95 — — — —
9. Actual return on plan assets 17.38 12.50 — — — —
E. Major category of plan assets as a percentage of total plan
Government of India securities 0.00% 0.36%
Corporate Bonds 0.00% 0.61%
Special Deposit Scheme 0.00%
Funded with LIC 100.00% 98.37%
Others 0.00% 0.66%

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 MAHINDRA & MAHINDRA LIMITED (CONSOLIDATED)

Rupees crores

Gratuity Gratuity Post Retirement

(Funded) (Unfunded) Medical Benefits
(Unfunded)
2009 2008 2009 2008 2009 2008
F. Actuarial Assumptions
1. Discount Rate (Basis - prevailing market yields of 7.50 % - 7.50 % - 7.50 % - 7.50 % - 7.50 % - 8.20 % -
govt securities) 8.50 % 8.50 % 8.50 % 8.50 % 8.50 % 8.25 %
2. Expected Rate of return on plan assets 7.50 % - 7.50 % -
9.50 % 9.45 %
3. In-service Mortality Indian Assured Lives Mortality (1994-96) Modified ultimate
4. Turnover rate 5.00% Age 21 to Age 21 to Age 21 to Age 21 to Age 21 to
30 - 10% 30 - 10% 30 - 10% 30 - 10% 30 - 10%
Age 31 to Age 31 to Age 31 to Age 31 to Age 31 to
40 - 5% 40 - 5% 40 - 5% 40 - 5% 40 - 5%
Age 41 to Age 41 to Age 41 to Age 41 to Age 41 to
50 - 3% 50 – 3% 50 - 3% 50 – 3% 50 - 3%
Age 51 & Age 51 & Age 51 & Age 51 & Age 51 &
above - 2% above - 2% above - 2% above - 2% above - 2%
5. Medical Premium inflation 3.00 % - 3.00% -
6.00 % - 6.00% -
One percentage point increase in One percentage point decrease
medical inflation rate in medical inflation rate
G. Effect of one percentage point change in the assumed
medical inflation rate
Current Year
Effect on the aggregate service and interest cost of
Post Employment Medical benefits 0.14 (0.16)
Effect on the accumulated Post Employment Medical
benefit obligations 0.46 (1.38)
Previous Year
Effect on the aggregate service and interest cost of
Post Employment Medical benefits 0.05 (0.08)
Effect on the accumulated Post Employment Medical
benefit obligations 0.40 (0.34)
Rupees crores
Period ended
H. Experience Adjustments 2009 2008 2007
Gratuity (Funded)
Defined Benefit obligation 341.72 278.71 204.46
Plan Assets 239.13 217.95 144.67
(Deficit)/Surplus (102.59) (60.76) (59.79)
Experience adjustments on plan liabilities 34.34 (3.36) —
Experience adjustments on plan assets 0.02 — —
Gratuity (Unfunded)
Defined Benefit obligation 95.95 52.75 32.05
Plan Assets — — —
(Deficit)/Surplus (95.95) (52.75) (32.05)
Experience adjustments on plan liabilities 0.02 — —
Experience adjustments on plan assets — — —
Post Retirement Medical Benefits
(Unfunded)Defined Benefit obligation 5.00 2.95 3.30
Plan Assets — — —
(Deficit)/Surplus (5.00) (2.95) (3.30)
Experience adjustments on plan liabilities 1.24 (0.49) 0.07
Experience adjustments on plan assets — — —
Basis used to determine expected rate of return on assets :
Based on expectation of the average long term rate of return expected on investment of the fund, during the estimated term of obligation.
The estimate of future salary increase, considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant
factors, such as supply and demand in the employment market.

157
13. The Commissioner of Central Excise (Adjudication), Navi Mumbai, passed an order on 30th March, 2005, confirming the demand made on the
Company for payment of differential excise duty (including penalty) of Rs. 304.11 crores in connection with the classification of Company’s
Commander range of vehicles, during the years 1991-1996. Whilst the Company had classified the Commander range of vehicles as 10-seater
attracting a lower rate of excise duty, the Commissioner of Central Excise (Adjudication), Navi Mumbai, has held that these vehicles could not be
classified as 10-seaters and as such attracted a higher rate of excise duty. In earlier proceedings, the Collector of Central Excise, Mumbai as also
the Collector Central Excise (Appeals), Mumbai had upheld the classification of these vehicles as 10-seaters. Similarly, certain statutory/expert
bodies have also confirmed the concerned vehicles to be 10-seater vehicles.
The Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has also by its order dated 19th July, 2005 upheld this classification. The
department’s Statutory Appeal against this order has been admitted by the Supreme Court.
The Commissioner of Central Excise, Nasik passed another order dated 20th March, 2006 confirming a demand of Rs. 24.75 crores in respect of
Company’s Armada range of vehicles manufactured during the years 1992 – 1996, on the same grounds as adopted for Commander range of
vehicles.
The Company has been legally advised that the aforesaid orders dated 30th March, 2005 and 20th March, 2006 passed by the Commissioners are
unsustainable in law. The Tribunal has also given an unconditional stay against both the aforesaid orders.
The final hearing in the above matters is awaited.
The Company is confident that it would succeed in the case and the Company’s stand that the Commander and Armada Vehicles are 10-seater
vehicles would be upheld. As such, the Company does not expect any liability on this account.

14. Contingent Liability :

(a) Guarantees given :
Rupees crores

Outstanding amounts against the guarantees

2009 2008

For employees ................................................................................................................ 1.05 0.03

For other companies ...................................................................................................... 181.39 5.41
Others ............................................................................................................................ 105.85 337.52

Group share in Joint Ventures Rs. Nil (2008 : Rs. 0.35 crores)
(b) Claims against the Companies not acknowledged as debts comprise of :
(i) Excise Duty, Sales tax and Service tax claims disputed by the Company relating to issues of applicability and classification aggregating
Rs. 427.70 crores (Net of Tax : Rs. 280.02 crores) {2008 : Rs. 206.41 crores (Net of Tax : Rs. 138.20 crores)}.
(ii) Other Matters (excluding claims where amounts are not ascertainable) : Rs. 104.68 crores (Net of Tax : Rs. 50.79 crores)
{2008 : Rs. 146.23 crores (Net of Tax : Rs. 37.15 crores)}.
(iii) On Capital account : Rs. 1.18 crores (2008 : Rs. 1.18 crores).
(iv) Group Share in Joint Ventures Rs. 0.38 crores (Net of Tax : 0.38 crores) {2008 : Rs. 0.51 crores (Net of Tax : Rs. 0.38 crores)}.
(c) Taxation matters :
(i) Demands not acknowledged as debts and not provided for, relating to issues of deductibility and taxability in respect of which the
matters are in appeal and exclusive of the effect of similar matters in respect of assessments remaining to be completed :
- Income Tax : Rs. 368.52 crores (2008 : Rs. 229.23 crores)
- Group Share in Joint Ventures : Rs. 0.29 crores (2008 : Rs. 3.15 crores)
(ii) Items which have succeeded in appeal, but the Income Tax Department is pursuing/likely to pursue in appeal/reference and exclusive
of the effect of similar matters in respect of assessments remaining to be completed :
- Income Tax matters : Rs. 58.63 crores (2008 : Rs. 60.49 crores)
- Surtax matters : Rs. 0.13 crores (2008 : Rs. 0.13 crores)
(d) Bills discounted not matured Rs. 91.31 crores (2008 : Rs. 44.21 crores).
(e) Corporate undertaking on Securitisation/Assignment by Mahindra & Mahindra Financial Services Limited Rs. 458.20 crores (2008 :
Rs. 308.22 crores).
15. (a) Provision - Others Rs. 389.37 crores (2008 : Rs. 324.55 crores) includes provision for warranty Rs. 170.55 crores (2008 : Rs. 139.11
crores). This relates to warranty provision made in respect of sale of certain products, the estimated costs of which are accrued at the time
of sale. The products are generally covered under a free warranty period ranging from 6 months to 3 years.
(b) Provision for Contingencies Rs. 11.08 crores (2008 : Rs. 9.55 crores) is in respect of labour demands under negotiation at certain locations
of the Company. The ultimate settlement is contingent on the conclusion of negotiations.

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 MAHINDRA & MAHINDRA LIMITED (CONSOLIDATED)

The movement in above provisions is as follows :

Rupees crores

Warranty Contingency

Provisions 2009 2008 2009 2008

Balance as at 1st April ...................................................................................... 139.11 103.43 9.55 3.46

Add : Amalgmation during the year ............................................................... 0.25 — — 1.39
Add : Provision made during the year ............................................................. 120.33 123.69 6.85 8.16
Less : Utilisation/Reversal during the year ........................................................ 89.14 88.01 5.32 3.46
st
Balance as at 31 March ................................................................................. 170.55 139.11 11.08 9.55

Group Share in Joint Venture : Rs. 0.10 crores (2008 : Rs. 0.16 crores)
16. The estimated amount of contracts remaining to be executed on capital account and not provided for as at 31st March, 2009 is Rs. 1,259.97
crores (2008 : Rs. 1,259.60 crores).
Group Share in Joint Ventures : Rs. 0.29 crores (2008 : Rs. 0.60 crores).
17. Research and Development expenditure debited to the Profit and Loss Account, including certain expenditure based on allocations made
aggregate Rs. 240.47 crores (2008 : Rs. 205.13 crores).
Group Share in Joint Ventures : Rs. 0.03 crores (2008 : Rs. 0.02 crores).

18. The components of Deferred Tax Liability and Assets as at 31st March, 2009 are as under :
Rupees crores
2009 2008

Deferred Tax Liability :

(i) On fiscal allowances on Fixed Assets ........................................................................................ 445.30 340.95
(ii) Others ....................................................................................................................................... 140.45 41.43
Group Share in Joint Ventures .................................................................................................. 0.50 0.46
586.25 382.84
Deferred Tax Assets :
(i) Provision for Compensated absences ....................................................................................... 101.40 79.31
(ii) Provision for Doubtful Debts/Advances .................................................................................... 209.99 141.64
(iii) Unabsorbed depreciation carried forward # ............................................................................ 115.66 64.75
(iv) Premium on Redemption of Zero Coupon Convertible Bonds ................................................. 40.08 48.67
(v) Provision for Gratuity ................................................................................................................ 1.49 16.23
(vi) Provision for Post Retirement Medical Expenses ....................................................................... 17.61 1.37
(vii) Others ....................................................................................................................................... 287.54 47.47
Group Share in Joint Ventures .................................................................................................. 0.88 0.97
774.65 400.41
Net Deferred Tax Liability/(Assets) ..................................................................................................... (188.40) (17.57)

# (considered, as there are compensatory timing differences the reversal of which, will result in sufficient future taxable income against which
this can be realised).

159
19. Exceptional items of Rs. 76.39 crores (Debit) {2008 : Rs. 302.51 crores (Debit)}, comprise of the following :

Rupees crores
2009 2008

1. Profit on divesture of Long Term Investments (Net) ................................................................. 83.18 178.37

2. Loss on dilution of Group’s interest in Forging Business ......................................................... — (31.00)
3. Impairment of Assets ................................................................................................................ (311.25) —
4. Transferred from Investment Fluctuation Account ................................................................... 154.38 —
5. Exclusivity Payment to a customer ............................................................................................ — (440.12)
6. Amortisation of liability ............................................................................................................ (5.30) —
7. Others ....................................................................................................................................... 2.60 (1.53)

Total ........................ (76.39) (294.28)

Figures in brackets signify charge to Profit and Loss Account.

During January 2009, the Company has disposed of its entire holding in Mahindra Retail Private Limited (MRPL), an erstwhile subsidiary. The
financial position of MRPL for the period April 08 to December 08 is summarised hereunder :

2009 2008
Income .............................................................................................................................................. 0.62 —
Expenses ............................................................................................................................................ 24.12 10.57
Profit before Tax ................................................................................................................................ (23.50) (10.57)
Profit after Tax ................................................................................................................................... (23.57) (10.58)

20. Adjustments pertaining to previous years, net of current and deferred tax, comprise of the following :
Rupees crores
2009 2008

1. (Excess)/Short provision of Income Tax in respect of previous years ........................................ 0.07 0.37
2. Short provision of warranties ................................................................................................... — 1.13
3. Other adjustments .................................................................................................................... 6.29 0.72

Total ........................ 6.36 2.22

21. (a) Dividends on other investments Rs. 100.94 crores (2008 : Rs. 50.73 crores) is in respect of current investments.
(b) Profit on sale of investments (Net) includes profit on disposal of current investments (Net) Rs. 12.53 crores (2008 : Rs. 26.60 crores), and
profit on disposal of long term investments (Net) Rs. 35.25 crores (2008 : Rs. 153.40 crores).
22. Work-in-progress – Property Development Activity and Long Term Contracts and Advances recoverable in cash or kind or for value to be received
includes Rs. 68.73 crores (2008 : Rs. 68.73 crores) on account of certain projects, the commencement of which has been delayed pending
resolution of certain matters including receipt of approvals and outcome of court cases.
23. Related Party Transactions :
(a) Names of related parties where transactions have taken place during the year :
Where Control exists :
Sl. No. Name of the Company

1. Tech Mahindra Foundation

Associates :
Sl. No. Name of the Company Sl. No. Name of the Company

1. Owens Corning (India) Limited 7. Mriyalguda Farm Solution Limited

2. Mahindra Construction Company Limited 8. Mega One Stop Farm Services Limited
3. Officemartindia.com Limited 9. Eco Engines
4. Rathna Bhoomi Enterprises Private Limited 10. Swaraj Automotives Limited
5. Mahindra Composites Limited 11. Swaraj Engines Limited
6. Kota Farm Services Limited

160
 MAHINDRA & MAHINDRA LIMITED (CONSOLIDATED)

Joint Ventures :

Sl. No. Name of the Company Sl. No. Name of the Company

1. Mahindra Sona Limited 3. Mahindra Inframan Water Utilities Private Limited

2. Mahindra Water Utilities Limited 4. PSL Erickson Limited

Key Management Personnel :

Vice Chairman and Managing Director ........................................... Mr. Anand Mahindra
Executive Directors ........................................................................... Mr. B.N. Doshi
Mr. A.K. Nanda
Welfare Funds :
Sl. No. Name of the Fund
1. Mahindra World School Education Trust

2. M&M Benefit Trust

3. M&M Employee’s Welfare Fund

4. M&M Employee’s Farm Equipment Sector Employee’s Welfare Fund

(b) The related party transactions are as under :

Rupees crores

Sl. Nature of Transactions Subsidiary Associate Joint Key Welfare

No. Companies Companies Ventures Management Funds
Personnel

1. Purchases :

Goods — 236.22 71.01 — —

(—) (127.33) (54.64) (—) (—)
Fixed Assets ...................................................... — — — — —
(—) (0.38) (—) (—) (—)
Services ............................................................. — 0.07 — — —
(—) (0.32) (—) (—) (—)

2. Sales :
Goods ............................................................... — 1.73 2.26 — —
(—) (5.27) (1.24) (—) (—)
Fixed Assets ...................................................... — 0.16 — — —
(—) (0.08) (—) (—) (—)
Services ............................................................. — 6.38 0.99 — —
(—) (1.95) (0.04) (—) (—)

3. Investments :
Purchase/Subscribed ......................................... — — — — 0.01
(—) (3.00) (—) (—) (—)

4. Deputation of Personnel :
To Related Parties ............................................. — 0.52 — — —
(—) (0.39) (—) (—) (—)

161
 Rupees crores

Sl. Nature of Transactions Subsidiary Associate Joint Key Welfare

No. Companies Companies Ventures Management Funds
Personnel

5. Provisions for :
Doubtful Advances during the year ................. 0.07 — — — —
(—) (—) (—) (—) (—)
Diminution in value of other assets written back — 0.04 — — —
(—) (—) (—) (—) (—)
6. Finance :
Interest received ............................................... — 1.85 — — —
(—) (3.18) (—) (—) (—)
Dividend Distributed ........................................ — — — — 1.05
(—) (—) (1.31) (—) (0.37)
Dividend Received ............................................ — 2.52 0.98 — —
(—) (—) (—) (—) (—)

7. Other Transactions :
Other Income ................................................... — 7.18 — — —
(—) (9.51) (0.02) (—) (—)
Donation given ................................................ — — — — —
(7.57)* (—) (—) (—) (—)
Other Expenses ................................................ 8.45* 0.01 — — —
(—) (—) (0.05) (—) (—)
Reimbursements received from parties ............ — 0.01 0.03 — —
(—) (0.02) (0.06) (—) (—)
Reimbursements made to parties .................... — 0.03 — — —
(—) (—) (—) (—) (—)
Advance given by group company…………… — @ — — 15.00
(—) (—) (—) (—) (—)

8. Outstandings :
Payable ............................................................. — 30.94 12.66 2.20 —
(—) (15.16) (10.19) (2.46) (—)
Receivable ......................................................... — 19.64 1.18 — 15.00
(—) (28.68) (1.50) (—) (—)
Inter Corporate Deposits given ........................ — 5.73 — — —
(—) (5.73) (—) (—) (—)

9. Provision for Diminution in value of

other related assets .......................................... — 7.65 — — —
(—) (7.65) (—) (—) (—)

10. Provision for Doubtful debts/advances ............ — 5.33 — — —

(—) (5.33) (—) (—) (—)

162
 MAHINDRA & MAHINDRA LIMITED (CONSOLIDATED)

Rupees crores

Sl. Nature of Transactions Subsidiary Associate Joint Key Welfare

No. Companies Companies Ventures Management Funds
Personnel

11. Managerial Remuneration ................................ — — — 5.16 —

(—) (—) (—) (5.39) (—)
12. Dividends .......................................................... — — — 0.52 —
(—) (—) (—) (0.17) (—)
13. Stock Options ................................................... — — — 0.07 —
(—) (—) (—) (0.05) (—)
14. Issue of Ordinary (Equity) Shares ..................... — — — — 14,59.76
(—) (—) (—) (—) (—)
15. Guarantees and Collaterals given .................... — — 9.00 — —
(—) (—) (—) (—) (—)
Previous year’s figures are in brackets.
* Amount pertains to Tech Mahindra Foundation
@ denotes amounts less than Rs. 50,000

Significant related party transactions are as under :

Rupees crores

Nature of Transactions Associate Companies Amount Joint Ventures Amount

1. Purchase - Goods ......................... Mahindra Composites Limited — Mahindra Sona Limited 71.01
(1.58) (54.64)
Swaraj Engines Limited 225.72
(125.75)
2. Purchase – Fixed Assets………… . Mahindra Composites Limited —
(0.33)
Swaraj Engines Limited —
(0.01)
3. Purchase – Services ....................... Swaraj Engines Limited 0.07
(0.32)
4. Sale – Goods ................................ Swaraj Engines Limited 1.71 Mahindra Sona Limited 2.26
(5.27) (1.24)
5. Sale – Fixed Assets ....................... Swaraj Automotives Limited 0.16
(—)
Swaraj Engines Limited —
(0.08)
6. Sale – Services .............................. Owens Corning (India) Limited 3.21 Mahindra Water 0.95
(—) Utilities Limited (—)
Swaraj Engines Limited 2.38 Mahindra Sona Limited —
(1.95) (0.04)
Swaraj Automotives Limited 0.78
(—)
7. Deputation of Personnel .............. Mahindra Composites Limited 0.52
(0.39)

163
Significant related party transactions are as under :
Rupees crores

Nature of Transactions Associate Companies Amount Joint Ventures Amount

8. Interest Received ........................ Owens Corning (India) Limited 1.85

(3.18)
9. Write back of provision of ........ Kota Farm Services Limited 0.04
doubtful debts/advances (—)
10. Dividend Received ...................... Swaraj Automotives Limited 0.32 Mahindra Sona Limited 0.98
(—) (1.31)
Swaraj Engines Limited 2.06
(—)
11. Other Income ............................ Owens Corning (India) Limited 6.89 Mahindra Sona Limited —
(9.25) (0.02)
Mahindra Composites Limited —
(0.25)
12. Reimbursement Received ........... Mahindra Construction Company 0.01 Mahindra Sona Limited 0.03
from parties Limited (—) (0.04)
Mahindra Composites Limited — Mahindra Water —
(0.01) Utilities Limited (0.01)
13. Other Expenses .......................... Mahindra Construction Company 0.01
Limited (—)
14. Reimbursement made to parties Mahindra Composites Limited 0.02
(—)
Swaraj Engines Limited 0.01
(—)
15. Payable ....................................... Mahindra Construction Company — Mahindra Sona Limited 12.66
Limited (0.11) (10.19)
Mahindra Composites Limited —
(0.55)
Swaraj Engines Limited 30.04
(14.50)
16. Receivables ................................. Owens Corning (India) Limited 12.37 Mahindra Sona Limited —
(20.85) (1.50)
Mahindra Construction Company 6.08 Mahindra Water 1.17
Limited (6.07) Utilities Limited (—)
Kota Farm Services Limited —
(0.25)
Miryalguda Farm Solution —
Limited (0.05)
Mega One Stop Farm Services —
Limited (0.54)
Mahindra Composites Limited —
(0.37)
Swaraj Engines Limited —
(0.54)

164
 MAHINDRA & MAHINDRA LIMITED (CONSOLIDATED)

Rupees crores

Nature of Transactions Associate Companies Amount Joint Ventures Amount

17. Guarantees given ....................... Mahindra Water 9.00

Utilities Limited (—)

18. Inter Corporate Deposits given Mahindra Construction Company 5.73

Limited (—)
19. Provision for diminution in ........ Mahindra Construction Company 6.69
value of other related assets Limited (—)
20. Provision for doubtful debts / ... Mega One Stop Farm Services 0.54
advances Limited (—)
Mahindra Construction Company 4.49
Limited (—)

Previous year’s figures are in brackets.

24. Earnings per Share :

2009 2008

Amount used as the numerator – Net Profit (Rupees crores) ............................................................................... 1,405.41 1,571.12

(Gain)/Loss on difference in exchange on bonds (Rupees crores) ......................................................................... 17.29 (42.97)

Amount used as the numerator for diluted earnings per share (Rupees crores) .................................................. 1,422.70 1,528.15

Weighted average number of equity shares used in computing basic earnings per share ................................... 27,25,22,947 23,86,22,366

Effect of potential ordinary (equity) shares on conversion of bonds/debentures ................................................. 2,22,19,413 1,67,57,276

Weighted average number of equity shares used in computing diluted earnings per share ............................... 29,47,42,360 25,53,79,642

Basic Earnings per share (Rs.) (Face value of Rs. 10 per share) ............................................................................. 51.57 65.84

Diluted Earnings per share (Rs.) ............................................................................................................................. 48.27 59.84

25. Investment in Associates :

No. of Equity % of Cost of Goodwill/ Share in Carrying

shares held Holding Investments (Capital accumulated Cost
(Equity reserve) Profit/(Loss)/
Shares) Reserves
(Nos.) (Rupees crores)

Unquoted :
Owens Corning (India) Limited ......................... 2,81,24,794 21.50% 28.12 (7.64) 21.82 49.94
2,81,24,794 21.50% 28.12 (7.64) 19.77 47.89
Mahindra Construction Company Limited ........ 9,00,000 43.83% 0.97 — (0.97) —
9,00,000 43.83% 0.97 — (0.97) —
Officemartindia.com Limited ............................. 7,49,997 50.00% 0.22 — (0.22) —
7,49,997 50.00% 0.22 — (0.22) —
Rathna Bhoomi Enterprises Private Limited ....... 500 20.43% @ — @ —
500 20.43% @ — @ —

165
 No. of Equity % of Cost of Goodwill/ Share in Carrying
shares held Holding Investments (Capital accumulated Cost
(Equity reserve) Profit/(Loss)/
Shares) Reserves
(Nos.) (Rupees crores)
Kota Farm Services Limited ................................ 2,73,420 37.37% 0.27 — (0.27) —
2,73,420 34.79% 0.27 — (0.27) —
Mriyalguda Farm Solution Limited .................... 3,37,500 37.37% 0.34 — (0.34) —
3,37,500 34.79% 0.34 — (0.34) —
Mega One Stop Farm Services Limited ............. 3,51,000 37.37% 0.35 0.03 (0.35) —
3,51,000 34.79% 0.35 0.03 (0.35) —
Eco Engines ....................................................... — — 0.15 — — 0.15

Total............. 50.09
47.89

Quoted :
Mahindra Composites Limited .......................... 13,41,203 30.56% 2.90 0.55 2.33 5.23
13,41,203 30.56% 2.90 0.55 1.45 4.35
Swaraj Engines Limited ..................................... 41,19,000 33.22% 1.63 (1.36) 9.17 10.80
41,19,000 21.49% 1.63 — 2.70 4.33
Swaraj Automotives Limited .............................. 10,59,543 44.19% 12.45 (1.99) 3.40 15.85
10,59,543 35.64% 12.45 8.34 1.53 13.98

Total............. 31.88
22.66
Total............. 81.97
70.55

@ denotes amounts less than Rs. 50,000

166
 CMYK
26. Segment Information :

Segment Report for the year ended 31st March, 2009.

Primary Segment Disclosure - Business Segment Rupees crores

Automotive Farm IT Services Financial Trading Infrastructure Hospitality Systech Others Eliminations Consolidated
Equipment Services Total

REVENUE
Gross External Revenue 9,986.24 6,850.11 4,654.26 1,389.56 728.06 339.37 406.09 3,821.14 664.32 — 28,839.15
10,315.15 5,472.40 3,917.91 1,229.83 655.39 212.92 354.17 3,530.76 755.26 — 26,443.79

Less : Excise Duty on Sales 1,662.84 136.36 — — 58.94 — — 196.20 17.84 — 2,072.18
1,783.11 118.75 — — 32.80 — — 205.49 14.67 — 2,154.82

Net External Revenue 8,323.40 6,713.75 4,654.26 1,389.56 669.12 339.37 406.09 3,624.94 646.48 — 26,766.97
8,532.04 5,353.65 3,917.91 1,229.83 622.59 212.92 354.17 3,325.27 740.59 — 24,288.97

Inter Segment Revenue 18.72 19.56 35.16 10.36 290.31 11.09 0.32 506.17 210.14 (1,101.83) —
4.46 24.37 30.85 7.03 336.81 7.93 0.09 326.45 290.57 (1,028.56) —
Total Revenue 8,342.12 6,733.31 4,689.42 1,399.92 959.43 350.46 406.41 4,131.11 856.62 (1,101.83) 26,766.97
8,536.50 5,378.02 3,948.76 1,236.86 959.40 220.85 354.26 3,651.72 1,031.16 (1,028.56) 24,288.97

RESULT
Segment result before 257.72 667.85 1,126.28 333.91 94.80 112.08 93.66 23.86 (46.71) — 2,663.45
exceptional items 741.25 603.49 802.04 279.14 88.32 75.21 108.47 201.26 118.83 — 3,018.01

Exceptional item allocated (156.87) — — — — — — (2.68) — — (159.55)

to Segments — — (440.12) — — — — (1.52) — — (441.64)

Segment result after 100.85 667.85 1,126.28 333.91 94.80 112.08 93.66 21.18 (46.71) — 2,503.90
exceptional items 741.25 603.49 361.92 279.14 88.32 75.21 108.47 199.74 118.83 — 2,576.37
Unallocable Corporate 93.18
expenses (Net of Income) 82.85
Operating Profit 2,410.72
2,493.52
Less : Interest expense not allocable to segments 337.33
249.85
Add : Interest Income not allocable to segments 97.57
112.16
Add : Exceptional Item Unallocable to segment 83.16
148.16
Profit before Tax 2,254.12

MAHINDRA & MAHINDRA LIMITED (CONSOLIDATED)

2,503.99
Less : Income Taxes – Current Tax including Fringe Benefit Tax 506.92
691.84
– Deferred Tax 35.25
(34.64)
Profit for the year before prior year adjustments 1,711.95
1,846.79
Less : Adjustments pertaining to previous years 6.36
2.22

Balance of Profit for the year before Share of Profit of Associates 1,705.59
1,844.57
Share of Profit of Associates 11.27
10.00
Profit for the year before Minority Interests 1,716.86
1,854.57
167
168
Segment Information (Contd.) :

Rupees crores

Automotive Farm IT Services Financial Trading Infrastructure Hospitality Systech Others Eliminations Consolidated
Equipment Services Total

OTHER INFORMATION
Segment Assets 5,291.77 3,328.87 2,380.63 7,170.74 320.49 1374.38 1,004.02 2,963.55 528.71 — 24,363.16
4,605.71 2,800.48 2,075.50 6,870.11 396.22 975.38 745.25 2,703.23 551.64 — 21,723.52

Unallocable Corporate 7,509.42

Assets 4,585.65

Total Assets 31,872.58

26,309.17
Segment Liabilities 2,212.44 1,618.66 920.61 5,873.02 156.68 106.51 721.56 932.53 189.83 12,731.84
2,100.66 1,204.25 803.34 5,624.38 222.60 91.47 539.56 799.55 151.86 11,537.67

Unallocable Corporate 8,764.26

Liabilities 5,886.40

Total Liabilities 21,496.10

17,424.07
Capital Expenditure 1455.40 366.61 272.80 14.52 9.93 72.88 163.33 477.69 180.89
907.31 168.85 237.96 13.74 26.74 58.37 78.08 615.74 50.82

Depreciation/Amortisation 249.85 100.27 112.28 8.83 9.62 2.51 16.84 233.44 9.69
215.38 80.41 81.59 8.81 5.73 3.46 11.31 160.41 4.13

Non cash expenditure other — — — — — — — — —

than depreciation — — — — — — — — —
CMYK

MAHINDRA & MAHINDRA LIMITED (CONSOLIDATED)

Secondary Segment Disclosure - Geographical Segment

Rupees crores

Domestic Overseas Total

Revenue From External Customers ............................... 24,739.14 4,100.01 28,839.15

18,789.38 7,654.41 26,443.79
Segment Assets ............................................................ 21,902.18 2,461.00 24,363.18
19,639.81 2,083.72 21,723.53
Capital Expenditure ...................................................... 2,933.04 81.01 3,014.05
1,921.02 236.57 2,157.59

Notes :
1. Business Segments
The Group has considered business segments as the primary segment for disclosure.
The segments have been identified taking into account the organisational structure as well as the differing risks and returns of these segments.
Automotive Segment comprises of sales of automobiles, spare parts and related services.
Farm Equipment Segment comprises of sales of Tractors, spare parts and related services.
IT Services comprises of services rendered for IT and Telecom.
Financial Services comprise of services relating to financing, leasing and hire purchase of automobiles and tractors.
Infrastructure comprise of operating of Commercial complexes, Project management and development.
Hospitality comprises of sale of Timeshare.
Systech comprises of Automotive components and other related products and services.
Others comprise of Logistics, After-market, Two wheelers, Investment etc.
2. Secondary Segments
The geographical segments are considered for disclosure as secondary segment.
Domestic segment includes sales to customers located in India and service income accrued in India.
Overseas segment includes sales and services rendered to customers located outside India.
Segment Revenue comprises of :
Rupees crores
2009 2008

Sales .................................................................................................................................................... 21,058.63 19,774.28

Income from Services rendered ........................................................................................................... 5,717.55 4,758.48
Income from long term contracts ....................................................................................................... 160.07 166.69
Income from project management ..................................................................................................... 1.56 0.38
Hire purchase and lease income ......................................................................................................... 161.24 38.39
Income from Loan, Retained Interest in securitised Asset & Securitisation ........................................ 1,373.41 1,198.81
Other allocable income * .................................................................................................................... 366.69 506.76
Total ............................ 28,839.15 26,443.79

Rupees crores
2009 2008

*Other allocable income includes :

Interest Income ................................................................................................................................... 8.90 13.25
Scrap Sales .......................................................................................................................................... 138.21 110.76
Commission ......................................................................................................................................... 16.98 14.91
Dividend .............................................................................................................................................. 1.10 6.22
Others .................................................................................................................................................. 201.50 361.62
Total ............................ 366.69 506.76

27. Previous year’s figures have been regrouped/restated wherever necessary.

169
 CMYK
170

Details of Subsidiary Companies Rupees crores

Details of
Capital Investments
(including (excluding Proposed
Name of the Subsidiary Preference Reserves & Total Total Investments in Gross Profit Provision Profit Dividend &
Capital) Surplus Assets Liabilities subsidiaries) Turnover before Tax for Tax after Tax Tax thereon
Bristlecone (Malaysia) SDN. BHD # 0.14 0.92 2.44 2.44 - 2.18 0.30 0.06 0.24 -
Bristlecone GmbH # 0.34 1.45 9.84 9.84 - 26.40 0.32 - 0.32 -
Bristlecone Inc # 112.85 (91.76) 47.08 47.08 - 122.81 (0.14) 0.18 (0.32) -
Bristlecone India Limited 19.05 14.38 66.58 66.58 0.01 114.69 11.36 1.83 9.52 -
Bristlecone Limited # 83.48 (15.08) 159.15 159.15 - 0.07 (6.37) - (6.37) -
Bristlecone Singapore Pte. Limited # 4.26 (3.00) 5.73 5.73 - 8.42 (1.29) - (1.29) -
Bristlecone UK Limited # 13.13 (12.58) 2.17 2.17 - 2.60 (5.94) - (5.94) -
CanvasM (Americas) Inc # @ 0.08 11.24 11.24 - 42.60 (0.08) 0.02 (0.10) -
CanvasM Technologies Limited 57.67 (1.66) 89.80 89.80 36.24 45.39 0.41 0.07 0.34 -
Crest Geartech Limited 0.09 0.34 6.91 6.91 - 11.23 0.29 0.04 0.25 -
EFF Engineering S.r.l. # 0.34 0.39 7.08 7.08 - 6.96 0.20 0.02 0.18 -
Engines Engineering S.r.l. # 0.68 19.19 66.76 66.76 0.51 40.99 (1.28) 0.17 (1.45) -
Falkenroth Umformtechnik GmbH # 6.93 8.95 81.90 81.90 - 256.40 (8.55) 0.10 (8.65) -
Gesenkschmiede Schneider GmbH # 82.92 42.66 337.46 337.46 0.24 819.11 (4.95) 0.67 (5.62) -
Heritage Bird (M) SDN BHD # 0.42 (0.11) 7.69 7.69 - 0.83 (0.11) - (0.11) -
ID-EE Srl # 0.34 @ 1.10 1.10 - 1.89 0.04 0.04 @ -
Jeco-Jellinghaus GmbH # 34.66 8.39 82.47 82.47 0.04 297.93 (6.78) 0.32 (7.10) -
Jensand Limited # 0.44 - 0.44 0.44 - - - - - -
Mahindra Gears Cyprus Limited # 0.06 289.09 289.39 289.39 - - (0.73) - (0.73) -
Mahindra & Mahindra Financial Services Limited 95.71 1,372.16 7,265.12 7,265.12 97.16 1,375.27 325.62 111.10 214.52 62.35
Mahindra & Mahindra South Africa (Proprietary) Limited # 19.68 (12.86) 61.00 61.00 - 105.70 (28.40) (7.80) (20.60) -
Mahindra (China) Tractor Company Limited # 108.43 (85.06) 87.61 87.61 - 91.81 (22.58) - (22.58) -
Mahindra Aerospace Private Limited 0.05 (0.38) 5.49 5.49 - - (0.26) - (0.26) -
Mahindra Automotive Australia Pty. Limited # 3.08 (2.27) 5.53 5.53 - 1.44 (2.44) (0.10) (2.34) -
Mahindra Bebanco Developers Limited 0.05 (0.32) 26.14 26.14 - @ (0.32) @ (0.32) -
Mahindra Castings Private Limited 25.37 - 171.42 171.42 - 3.70 3.23 0.62 2.61 -
Mahindra Consulting Engineers Limited 1.00 2.50 5.77 5.77 - 7.83 1.66 0.61 1.05 0.41
Mahindra Defence Land Systems Private Limited - - - - - - - - - -
Mahindra Engineering and Chemical Products Limited 5.40 32.74 81.03 81.03 38.95 67.18 10.32 3.43 6.89 2.21
Mahindra Engineering Services (Europe) Limited # 0.47 6.29 11.00 11.00 - 26.57 5.58 1.57 4.01 -
Mahindra Engineering Services Limited 8.13 55.01 150.12 150.12 9.53 159.05 25.10 6.08 17.77 6.85
Mahindra Europe s.r.l. # 6.76 3.03 61.83 61.83 - 98.23 1.47 0.81 0.66 -
Mahindra First Choice Services Limited 11.05 (5.86) 7.17 7.17 2.00 2.09 (5.84) 0.02 (5.86) -
Mahindra First Choice Wheels Limited 63.43 (12.43) 63.80 63.80 2.30 142.86 (21.67) 0.14 (21.82) -
Mahindra Forgings Europe AG # 33.79 17.92 251.64 251.64 - 18.10 (19.59) (0.74) (18.85) -
Mahindra Forgings Global Limited # 228.72 (4.46) 224.31 224.31 - 0.26 (0.01) - (0.01) -
Mahindra Forgings International Limited # 486.50 (27.00) 680.24 680.24 - 16.27 (0.77) 1.62 (2.39) -
Mahindra Forgings Limited 68.57 599.24 972.93 972.93 2.00 271.77 (33.45) 6.63 (41.40) -
Mahindra Gears Global Limited # 290.55 (0.16) 290.46 290.46 - @ (0.16) - (0.16) -
Mahindra Gears International Limited # 155.41 (0.11) 155.34 155.34 - @ (0.12) - (0.12) -
Mahindra Graphic Research Design s.r.l. # 9.19 (2.63) 30.92 30.92 - 28.52 (1.82) 0.28 (2.10) -
Mahindra Gujarat Tractor Limited 20.30 (42.67) 25.37 25.37 0.05 74.38 (1.29) 0.10 (1.39) -
Mahindra Hinoday Industries Limited 30.60 (18.30) 240.62 240.62 @ 283.86 (70.89) (23.51) (47.71) -
Mahindra Holdings Limited 22.55 (1.12) 46.01 46.01 8.27 1.10 (1.23) (0.10) (1.13) -
Mahindra Holidays and Resorts USA Inc # 0.01 0.15 24.83 24.83 - 1.15 (4.68) - (4.68) -
Mahindra Holidays and Resorts India Limited 76.98 120.97 1,002.17 1,002.17 0.03 407.16 131.90 48.49 83.41 27.49
Mahindra Hotels and Residences India Limited 0.05 (0.01) 0.13 0.13 - - (0.01) - (0.01) -
Mahindra Industrial Township Limited 2.05 (0.07) 2.04 2.04 - - (0.07) - (0.07) -
@ denotes amounts less than Rs. 50,000.
# The financial statements of the Foreign Subsidiaries have been converted into Indian Rupees at the 31st March, 2009 exchange rate
 CMYK
Details of Subsidiary Companies (Contd.) Rupees crores

Details of
Capital Investments
(including (excluding Proposed
Name of the Subsidiary Preference Reserves & Total Total Investments in Gross Profit Provision Profit Dividend &
Capital) Surplus Assets Liabilities subsidiaries) Turnover before Tax for Tax after Tax Tax thereon
Mahindra Infrastructure Developers Limited 18.00 0.54 19.96 19.96 15.24 1.12 (0.06) (0.30) 0.24 -
Mahindra Insurance Brokers Limited 0.50 14.41 18.05 18.05 - 22.46 10.06 3.60 6.47 -
Mahindra Integrated Township Limited 50.00 (0.23) 78.66 78.66 - 31.85 0.49 0.06 0.43 -
Mahindra Intertrade Limited 16.60 116.73 332.74 332.74 41.25 896.65 71.40 25.96 44.71 14.57
Mahindra IT Consulting Private Limited 0.01 @ 0.01 0.01 - - @ - @ -
Mahindra Knowledge City Limited 12.60 (0.38) 12.24 12.24 - 0.01 (0.18) @ (0.18) -
Mahindra Life Space Developers Limited 50.81 846.14 997.50 997.50 81.03 186.66 57.77 11.41 46.36 13.16
Mahindra Logisoft Business Solutions Limited 12.45 (4.54) 8.25 8.25 @ 4.86 1.79 0.01 1.78 -
Mahindra Logistics Limited 49.05 2.89 193.51 193.51 @ 620.45 6.90 2.44 4.46 1.57
Mahindra Metal Castello S.r.l. # 135.14 156.50 530.27 530.27 - 0.61 (11.17) 0.73 (10.44) -
Mahindra Middleeast Electrical Steel Service Centre (FZC) # 2.81 18.09 47.44 47.44 - 136.85 12.65 - 12.65 -
Mahindra Navistar Automotives Limited 320.28 - 500.80 500.80 36.86 503.70 (24.85) 0.29 (25.14) -
Mahindra Navistar Engines Private Limited 41.50 (7.25) 47.79 47.79 - 0.40 (6.91) 0.18 (7.09) -
Mahindra Overseas Investment Company (Mauritius) Limited # 228.15 (5.58) 305.99 305.99 19.55 1.66 (2.42) - (2.42) -
Mahindra Renault Private Limited 199.26 - 555.93 555.93 - 741.17 (489.90) 0.31 (490.21) -
Mahindra Residential Developers Limited 0.26 53.71 54.34 54.34 - - (0.63) - (0.63) -
Mahindra Rural Housing Finance Limited 13.71 (1.39) 46.15 46.15 - 4.74 (0.74) 0.05 (0.80) -
Mahindra SAR Transmission Private Limited 7.56 19.84 75.34 75.34 - 81.27 4.28 1.66 2.62 0.88
Mahindra Shubhlabh Services Limited 38.93 - 48.40 48.40 1.08 50.43 (0.59) 0.08 (0.68) -
Mahindra Steel Service Centre Limited 6.10 20.22 37.09 37.09 1.10 12.70 4.55 1.29 3.25 1.00
Mahindra Technologies Inc # 3.01 (3.25) 0.50 0.50 - 0.50 (0.31) (0.05) (0.26) -
Mahindra Two Wheelers Limited 147.50 (22.50) 191.75 191.75 - 17.61 (22.46) 0.04 (22.50) -
Mahindra Ugine Steel Company Limited 32.48 136.55 690.97 690.97 14.43 1,212.09 (28.51) (9.68) (18.83) -
Mahindra United Football Club Private Limited 0.01 @ 0.01 0.01 - - @ - @ -
Mahindra USA Inc # 48.41 (8.48) 272.15 272.15 - 508.47 (39.15) (2.74) (36.41) -
Mahindra Vehicle Manufacturers Limited 485.00 (8.89) 913.87 913.87 90.41 - (6.46) 0.12 (6.57) -
Mahindra World City (Jaipur) Limited 170.00 1.91 485.24 485.24 11.95 82.78 6.78 1.66 5.13 -
Mahindra World City (Maharashtra) Limited 1.12 (0.08) 1.05 1.05 - - (0.01) - (0.01) -
Mahindra World City Developers Limited 85.00 16.74 186.58 186.58 0.26 99.35 43.63 15.01 28.62 7.37
Mahindra Yueda (Yancheng) Tractor Company Limited # 199.55 (3.16) 535.10 535.10 - 123.92 (3.16) - (3.16) -
Mahindra-BT Investment Company (Mauritius) Limited # 60.54 116.96 177.54 177.54 - 10.84 10.71 - 10.71 -

MAHINDRA & MAHINDRA LIMITED (CONSOLIDATED)

Metalcastello S.p.A # 123.29 151.29 638.91 638.91 0.01 614.11 52.43 17.62 34.81 -
MHR Hotel Management GmbH # 0.24 (0.10) 0.18 0.18 - 0.60 0.02 0.01 0.01 -
NBS International Limited 0.05 0.62 20.88 20.88 - 92.46 (0.28) (0.04) (0.23) -
Plexion Technologies GmbH # 0.40 - 0.61 0.61 - 0.33 (0.21) - (0.21) -
PT Tech Mahindra Indonesia # 2.55 14.78 49.06 49.06 - 72.32 13.14 4.03 9.11 -
Schöneweiss & Co. GmbH # 33.79 156.38 389.67 389.67 - 611.90 (5.08) (1.80) (3.28) -
Stokes Forgings Dudley Limited # @ - @ @ - - - - - -
Stokes Forgings Limited # 0.44 (0.44) - - - 6.87 6.87 - 6.87 -
Stokes Group Limited # 3.99 (23.81) 104.07 104.07 - 198.53 (39.41) 4.67 (44.08) -
Tech Mahindra (Americas) Inc # 1.91 28.28 61.49 61.49 - 462.92 25.20 9.80 15.40 -
Tech Mahindra (Beijing) IT Services Limited # 1.06 (1.97) 0.07 0.07 - @ (1.65) - (1.65) -
Tech Mahindra (Malaysia) SDN. BHD # 0.44 0.16 2.73 2.73 - 5.07 0.10 - 0.10 -
Tech Mahindra (Singapore) Pte. Limited # 0.17 7.34 14.07 14.07 - 34.36 1.94 0.41 1.53 -
Tech Mahindra (Thailand) Limited # 0.73 0.48 1.57 1.57 - 2.27 0.10 - 0.10 -
Tech Mahindra GmbH # 3.89 12.91 25.68 25.68 - 79.46 3.74 0.01 3.73 -
Tech Mahindra Limited 121.73 1,759.21 2,771.64 2,771.64 398.45 4,309.43 1,090.51 103.87 986.64 -
Venturbay Consultants Private Limited 0.01 (0.01) @ @ - - @ - @ -
Tech Mahindra Foundation 0.05 36.08 36.16 36.16 - 5.79 0.03 - 0.03 -
@ denotes amounts less than Rs. 50,000.
171

# The financial statements of the Foreign Subsidiaries have been converted into Indian Rupees at the 31st March, 2009 exchange rate
 Notes

172
 MAHINDRA & MAHINDRA LIMITED (CONSOLIDATED)

Notes

173
 Notes

174
Infomedia 18