MAHINDRA & MAHINDRA LTD. Integrated Annual Report 2023-24 342 (ii) The movements in Cash Flow Hedge Reserve for instruments designated in a cash flow hedge are as follows: Rupees crores Particulars 2024 2023 Balance as at the beginning of the year................................................................................................................................................... 7.16 (5.29) (Gains) / Losses transferred to Profit or Loss on occurrence of the forecast transaction................................... (12.37) 6.24 Change in fair value of effective portion of cash flow hedges................................................................................................. 7.40 10.40 Total.................................................................................................................................................................................................................................... (4.97) 16.64 Deferred tax effect on above............................................................................................................................................................................ 1.25 (4.19) Balance as at the end of the year................................................................................................................................................................. 3.44 7.16 Of the above: Balance relating to continuing hedges........................................................................................................................................................ 3.44 7.16 (iii) Sensitivity Analysis Foreign Currency Sensitivity The following tables demonstrate the sensitivity to a reasonably possible change in exchange rates, with all other variables held constant. Rupees crores Particulars Currency Change in rate Effect on profit before tax Effect on pre-tax equity* Year ended 31st March, 2024.................................................................................... USD / INR 10% 39.45 — EUR / INR 10% 1.49 — Year ended 31st March, 2023........................................................................................ USD / INR 10% 13.78 (16.22) EUR / INR 10% 2.45 — * Includes items directly accounted in reserves. The sensitivity analysis is unrepresentative of the inherent foreign exchange risk because the exposure at the end of the reporting period does not reflect the exposure during the year. Interest rate sensitivity The sensitivity analyses below have been determined based on exposure to interest rate for both derivative and non-derivative instruments at the end of reporting period. For floating rate liabilities, analysis is prepared assuming the amount of liability outstanding at the end of the reporting period, was outstanding for the whole year. The following table demonstrates the sensitivity to a reasonably possible change in interest rates on that portion of loans and borrowings affected, after the impact of hedge accounting. With all other variables held constant, the Company’s profit before tax is affected through the impact on floating rate borrowings, as follows: Rupees crores Particulars Currency Increase/ decrease in basis points Effect on profit before tax Effect on pre-tax equity Year ended 31st March, 2024.................................................................................... INR 25 — — Year ended 31st March, 2023........................................................................................ INR 25 2.00 — 41. Financial instruments (contd.)
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