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

MAHINDRA & MAHINDRA LIMITED 29 9. Transactions undertaken in previous Financial Year ended 31 st March 2023 and 31 st March, 2022 Rs. in crores Sr. No. Name of the Company Nature of Transactions FY22 FY23 a. Mahindra and Mahindra Financial Services Limited ("MMFSL")* # Purchase and sale of goods, property, plant & equipment, availing and rendering of services, trade advances, deputation / sharing of personnel, dividend received, interest income, royalty received for usage of 'Mahindra' Brand / Trade Name, other income and expenses, reimbursement received and paid, etc. 277.22 574.67 b. Mahindra Electric Automobile Limited ("MEAL") ## Sale of property, plant & equipment and other intangible assets, rendering of services, investments, reimbursement received, etc. NA 2,340.93** c. Mahindra Last Mile Mobility Limited ("MLMML") ## Not Applicable d. Mahindra Susten Private Limited ("MSPL") # Availing and rendering of services, sale of goods, deputation of personnel, inter- corporate deposits given, interest income , royalty received for usage of 'Mahindra' Brand / Trade Name and other income, reimbursement received, etc. 602.48 311.68 e. Sustainable Energy Infra Trust Not Applicable * MMFSL had not availed any borrowings from the Company in FY2022 and FY2023. However, MMFSL had availed ICDs from the Company aggregating to Rs. 1,200 crores from FY 2018 to FY 2020, ranging from 6 days to 1 year, at average interest rate of 8.21%, as per prevailing market rates. Besides, the Company had subscribed to NCDs issued by MMFSL on private placement basis aggregating to Rs. 195 Crores from FY 2020 to FY 2021. While MMFSL has been able to successfully raise funds from the market in the last few years, it may require the support of the Company in the coming years. MMFSL needs to have an enabling approval in place to resort to fund based support from the Company in the event of market / interest rate uncertainties. This would enable MMFSL to seamlessly source funds, as and when required in its normal course of business activities. Considering the above, the approval of Shareholders of the Company is being sought for transactions between the Company and MMFSL for an overall limit for each of the financial years from 2023-24 to 2027-28 which is the higher of the monetary value of Rs. 4,000 crores and an amount which is 4% of the annual consolidated turnover as per the last audited financial statements of the Company, subject to sub-limits as stated in point no. 2a. above. ** MEAL is a wholly-owned subsidiary of the Company. # The royalty received from MMFSL and MSPL for usage of ‘Mahindra’ Brand/ trade name was Rs. 1.12 lacs in FY22 and Rs. 0.89 lacs in FY23. The royalty received/ receivable from MMFSL and MSPL during each of the financial years 2024-2028, would be well below the permitted statutory ceiling as prescribed under Regulation 23 (1A) of Listing Regulations i.e. 5% of the annual consolidated turnover of the Company. ## Royalty would be charged to MEAL and MLMML for usage of ‘Mahindra’ Brand/ trade name from FY24 onwards. The royalty receivable from MEAL and MLMML during each of the financial years 2024-2028, would be well below the permitted statutory ceiling as prescribed under Regulation 23 (1A) of Listing Regulations i.e. 5% of the annual consolidated turnover of the Company. 2) For Item No. 12 Details of the Material Related Party Transactions pertaining to a Subsidiary of the Company: Sr. No. Particulars Disclosures 1. Name of the Related Party; Nature of relationship with the Subsidiary, including nature of its concern or interest (financial or otherwise); and Monetary Value Name of the Subsidiary Name of the Related Party Nature of relationship Monetary value p.a. Mahindra Susten Private Limited ("MSPL") Sustainable Energy Infra Trust ("SEIT") MSPL is a subsidiary of Mahindra Holdings Limited ("MHL"). MHL is wholly-owned subsidiary of the Company and thus, MSPL is a subsidiary of the Company. Sustainable Energy Infra Trust (“SEIT”) is a proposed Infrastruc- ture Investment Trust ("InvIT") with MSPL and Ontario Teachers' as Sponsors, which is under the process of being registered with SEBI. MSPL is expected to hold ap - prox. 15% of the total unitholding of SEIT. Not exceeding 3.5% of the Annual Consolidated Turnover of the Company # or Rs. 3,500 Crores, which - ever is higher, per annum # The Annual Consolidated Turnover shall be as per the last audited financial statements of the Company. 2. Type/Nature, material terms and particulars of the contract or arrangements Particulars Maximum Amount in any Financial Year Higher of (A) and (B) Monetary values p.a. Rs. in crores (A) % of Consolidated Turnover as per the last audited financial statements of the Com - pany for the relevant financial year (B) a) Sale/transfer of any security(ies) held by MSPL in its subsidiaries i.e. equity, debt or otherwise to SEIT; 2,700 2.7% b) Any transfer of resources, services or obligations to meet its objectives/ requirement including repayment of obligations by SEIT on behalf of its subsidiaries 800 0.8% Note: The value of receipt of dividends or distribution, etc. from SEIT to MSPL which is offered/applicable to all unitholders in proportion to their unit holding, cannot be ascertained by the Company. However, for each of the financial years from 2023-24 to 2027-28, the total value of transactions between MSPL and SEIT including dividend/distributions received will not breach the overall limit for a financial year which is the higher of the monetary value of Rs. 3,500 crores and an amount which is 3.5% of the annual consolidated turnover as per the last audited financial statements of the Company.