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

276 MAHINDRA & MAHINDRA LTD. Integrated Annual Report 2022-23 B. Trust-managed Provident fund: Rupees crores Particulars 2023 2022 i Net defined benefit obligation Defined benefit obligation......................................................................................................................................................................................... 3,355.68 3,004.62 Fair value of plan assets............................................................................................................................................................................................ 3,190.06 3,004.62 Surplus/(Deficit)................................................................................................................................................................................................................ (165.62) — ii Actuarial assumptions Discount rate...................................................................................................................................................................................................................... 7.45% 6.95% Average remaining tenure of investment portfolio (years)............................................................................................................... 5.35 4.63 Guaranteed rate of returns...................................................................................................................................................................................... 8.15% 8.10% The Company has recognised an obligation of Rs. 165.62 crores (2022: Nil) on account of interest rate guarantee through OCI. The plan assets have been primarily invested in government securities and corporate bonds. The Company’s contribution to Provident Fund and Superannuation fund aggregating Rs. 180.93 crores (2022 : Rs. 169.48 crores) has been recognised in Profit or Loss under the head Employee Benefits Expense. 36. Employee Stock Option Plan The Company has allotted 55,24,219 Ordinary (Equity) Shares of Rs. 10 each, 10,00,000 Ordinary (Equity) Shares of Rs. 10 each, 1,73,53,034 Ordinary (Equity) Shares of Rs. 5 each, 19,11,628 Ordinary (Equity) Shares of Rs. 5 each and 52,00,000 Ordinary (Equity) Shares of Rs. 5 each in the years ended 31 st March, 2002, 31 st March, 2010, 31 st March, 2011, 31 st March, 2014 and 31 st March, 2015 respectively to the Mahindra & Mahindra Employees’ Stock Option Trust (“M&M ESOP 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 recommendations of the Compensation Committee. Options granted under Mahindra & Mahindra Limited Employees Stock Option Scheme - 2000 (“2000 Scheme”) 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 any day over a period of five years from the date of vesting. Number of vested options exercisable is subject to a minimum of 50 or number of options vested whichever is lower. Options granted under Mahindra & Mahindra Limited Employees Stock Option Scheme - 2010 (“2010 Scheme”) vest in i) 5 equal instalments on the expiry of 12 months, 24 months, 36 months, 48 months and 60 months or ii) 5 equal instalments on the expiry of 36 months, 48 months, 60 months, 72 months and 84 months or iii) 4 instalments bifurcated as 20% on the expiry of 18 months, 20% on the expiry of 30 months, 30% on the expiry of 42 months and 30% on the expiry of 54 months or iv) 4 equal instalments on the expiry of 12 months, 24 months, 36 months and 48 months or v) 3 instalments bifurcated as 33.33% on the expiry of 12 months, 33.33% on the expiry of 24 months and 33.34% on the expiry of 36 months. or vi) 2 instalments bifurcated as 50% on the expiry of 12 months and 50% on the expiry of 24 months or vii) 2 instalments bifurcated as 40% on the expiry of 36 months and 60% on the expiry of 60 months The exercise period of above options range from 1 year to 6 years from the date of vesting. Number of vested options exercisable is subject to a minimum of 50 or number of options vested whichever is lower. Summary of stock options Particulars No. of stock options Weighted average exercise price (Rs.) Options outstanding on 1 st April, 2022............................................................................................................................................... 59,16,500 4.66 Options granted during the year.............................................................................................................................................................. 12,79,379 5.00 Options forfeited/lapsed during the year........................................................................................................................................... 3,02,061 4.44 Options exercised during the year.......................................................................................................................................................... 11,80,694 4.09 Options outstanding on 31 st Mar 2023.............................................................................................................................................. 57,13,124 3.67 Options vested but not exercised on 31 st Mar 2023................................................................................................................ 20,32,636 4.36 35. Employee Benefits (contd.)