MAHINDRA & MAHINDRA LTD. | Integrated Annual Report 2022-23

Your Company also has a presence in the Sugar Cane Haulage market (under the Mahindra HaulMaster brand) in the export market. For the year under review, your Company sold 247 Haulage Tractors, a 135% increase from the 105 sold in F22. The BHL industry grew by 28% and the motor grader industry grew by 42% due to increased focus from the Government of India on infrastructure. a result of supply shortage of semiconductors in f irst half of F23 and time taken for rural recovery compared to pre-pandemic. To reduce dependence on oil imports, the industry is exploring options of alternate fuels like CNG, LNG, Ethanol, etc. The industry is also exploring options of flex fuel vehicles in the near future. The industry is also investing in next generation technologies like electric vehicles and hydrogen. The Government introduced Production Linked Incentive (PLI) Scheme for Automobile, Auto Components, ACC (Advanced Chemistry Cells) and Semiconductors to overcome the cost disabilities of the industry for manufacture of Advanced Automotive Technology products in India. The Government has recognised Electric Vehicle technology and Hydrogen Fuel Cell technology as an Advanced Automotive Technology in the country. TWO-WHEELER SEGMENT In line with the strategy for the two-wheeler business, your Company through its subsidiary, Classic Legends Private Limited (CLPL) had reintroduced the iconic brand 'Jawa' to the Indian market in F19, with the launch of new range of JAWAmotorcycles - Jawa and Jawa Forty- Two and strengthening of portfolio by adding Yezdi in F22. During F23, 42 Bobber was introduced to the Indian market and in addition, CLPL forayed into international market by introducing iconic British brand BSA in UK and Europeanmarket. OPPORTUNITIES AND THREATS AUTOMOTIVE SECTOR Indian automotive industry has been christened as a sunrise sector and champion industry due to the immense contribution the industry makes to the Indian economy. The automotive industry's turnover is 7.1%of India's GDP and 49%of manufacturing GDP. In F23, the Indian auto industry has shown double digit growth across all segments. Passenger vehicles have reached new highest ever mark with 3.89 million sales units while commercial vehicles are still below F19 levels by 4.5%. Indian auto industry sales (excluding two- wheelers) have recorded highest ever sales of 5.3 million units with 15.7% YoY growth. Partial recovery of Auto Industry was principally FARM EQUIPMENT SECTOR To drive sustainable growth in the agriculture sector, strong Government focus on its development has led to increased adoption of mechanisation and modern agricultural practices, along with rural development at large. However, India, with its large base of small and marginal farmers, has several regions with low penetration of farm mechanisation. With increasing labour cost and labour scarcity, greater adoption of various forms of mechanisation is the way forward. In this scenario, the market for tractors and other farm equipment is expected to grow in the long term. ALLIED BUSINESSES The rising demand for power backup solutions and infrastructure development will create opportunities in the power generation and infrastructure equipment space. This is an opportunity for the Company to grow its offerings in power solutions and construction equipment. RISKS AND CONCERNS AUTOMOTIVE AND FARM EQUIPMENT SECTORS The Company's business is exposed to many internal and external risks and it has consequently put in place robust systems and processes, along with appropriate review mechanisms to actively monitor,manage andmitigate these risks. 124