MAHINDRA & MAHINDRA LTD. Consolidated Accounts 403 Net Debt and Equity other than financial services segment is given in the table below : Rupees crores Particulars 2025 2024 Total Equity.............................................................................................................................................................................................................................................. 67,525.03 57,534.48 Net Debt Short term debt...................................................................................................................................................................................................................................... 1,394.74 2,789.12 Long term debt........................................................................................................................................................................................................................................ 3,058.94 2,324.99 Gross Debt................................................................................................................................................................................................................................................. 4,453.68 5,114.11 Less: Current investments............................................................................................................................................................................................................................. 16,431.95 10,883.59 Cash and Bank Balances................................................................................................................................................................................................................... 15,182.33 10,472.04 Net Debt...................................................................................................................................................................................................................................................... (27,160.60) (16,241.52) Total Capital deployed.................................................................................................................................................................................................................... 40,364.43 41,292.96 39. Financial instruments Financial Risk Management Framework In the course of its business, the Group is exposed to a certain financial risks namely credit risk, interest risk, currency risk & liquidity risk. The Group’s primary focus is to achieve better predictability of financial markets and seek to minimize potential adverse effects on its financial performance. The financial risks are managed in accordance with the risk management policy which has been approved by Board of Directors of the respective Group companies. Board of Directors of financial services businesses have established Asset and Liability Management Committee (ALCO), which is responsible for developing and monitoring risk management policies for their businesses. The financial services businesses are exposed to high credit risk given the unbanked rural customer base and diminishing value of collateral. The credit risk is managed through credit norms established based on historical experience. (a) Market Risk Management Market risk is the risk that changes in market prices such as foreign exchange rates, interest rates etc. could affect the Group’s income or the value of its holdings of financial instruments including cash flow. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while maximising the return. (i) Currency Risk The Group’s exposure to currency risk relates primarily to the Group’s operating activities including anticipated sales & purchase and borrowings where the transactions are denominated in foreign currencies. The Group’s foreign currency exposures are managed within approved parameters. The Group hedges its foreign currency risk mainly by way of Forward Covers. Other derivative instruments may also be used if deemed appropriate. The carrying amounts of the Group’s foreign currency exposure at the end of the reporting period are as follows : Rupees crores Particulars US Dollar Euro JPY Others Total As at 31st March, 2025 Financial Assets ........................................................................................................... 3,436.70 212.24 46.09 856.92 4,551.95 Financial Liabilities .................................................................................................... 6,854.95 288.54 1,013.17 257.15 8,413.81 As at 31st March, 2024 Financial Assets ........................................................................................................... 3,287.88 108.52 4.60 563.15 3,964.15 Financial Liabilities ..................................................................................................... 1,833.35 130.02 1,304.38 210.44 3,478.19 Hedge Accounting - Forwards & Options Contracts that meet the requirements for hedge accounting are accounted as per the hedge accounting requirements of Ind AS 109 - Financial Instruments, while other contracts are accounted as derivatives measured through profit or loss. 38. Capital management (Continued)
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