MAHINDRA & MAHINDRA LTD. Integrated Annual Report 2023-24 434 40. Financial Instruments (Continued) (d) Fair Value Disclosures (i) Financial Instruments regularly measured using fair value - recurring items Rupees crores Particulars Financial assets/ financial liabilities Fair Value Category Fair value Fair value hierarchy Valuation technique(s) Key inputs (for level 2 and level 3) Significant unobservable input(s) for level 3 hierarchy Relationship of unobservable inputs to fair value and sensitivity 2024 2023 1) Foreign currency forwards, Interest rate swaps & commodity derivatives Financial Assets Financial Instruments measured at FVTPL / FVTOCI - Current 19.93 20.93 Level 2 Discounted Cash Flow and Interest rate Future cash flows are estimated based on forward exchange rates (from observable forward exchange rates at the end of the reporting period) and contract forward rates, discounted at a rate that reflects the credit risk of various counter parties. — — 2) Derivatives on interest over subsidiaries and joint ventures Financial Assets Financial Instruments measured at FVTPL - Non-current 14.69 28.20 Level 3 Comparable Companies Method / Discounted Cash-flow / Price of recent transactions / Comparable Companies quoted multiples For Comparable Companies Method / Comparable Companies Quoted Multiples - compare the price for which comparable companies are traded on the capital market. For Discounted Cash Flow - Companies Financial projections. These include forecasts of balance sheet, statement of profit and loss along with underlying assumptions. Interest rates to discount future cashflows, financial projections Any change (increase / decrease) in the discount factor, financial projections etc. would entail corresponding change in the valuation of derivatives on interest in subsidiaries, associates and joint ventures. 3) Investment in debentures / bonds - Quoted Financial Assets Financial instrument measured at FVTOCI - Non-current 453.34 351.43 Level 1 Quoted market price — — — Financial instrument measured at FVTOCI - Current 593.66 24.85 Level 1 Quoted market price — — — Financial instrument measured at FVTPL - Current 28.34 100.53 Level 1 Quoted market price — — — 4) Investment in debentures / bonds - Unquoted Financial Assets Financial instrument measured at FVTPL - Non-current 50.20 65.56 Level 3 Income Approach - Discounted Cash Flow For Discounted Cash Flow approach - The discounted cash flow method used to capture the present value of the expected future economic benefits to be derived from the ownership of these investees. The key inputs includes, long term revenue growth rates, balance sheets, statement of profit and loss along with underlying assumptions. Interest rates to discount future cash flow, financial projections Increase or decrease in key assumptions will result in increase or decrease in valuation Financial instrument measured at FVTOCI - Non-current 1.59 1.59 Level 2 Discounted Cash Flow and Interest rate Future cash flows are estimated based on forward exchange rates (from observable forward exchange rates at the end of the reporting period) and contract forward rates, discounted at a rate that reflects the credit risk of various counter parties. — — 5) Investment in preference shares Financial Assets Financial instrument measured at FVTPL - Non-current 208.44 3.43 Level 3 Income Approach - Discounted Cash Flow For Discounted Cash Flow approach - The discounted cash flow method used to capture the present value of the expected future economic benefits to be derived from the ownership of these investees. The key inputs includes, long term revenue growth rates, balance sheets, statement of profit and loss along with underlying assumptions. Interest rates to discount future cash flow, financial projections Increase or decrease in key assumptions will result in increase or decrease in valuation
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