‘Focused on Moving Ahead with Great Speed’

It was the best of times, It was the worst of times’ is how Mahindra Group Chairman Anand Mahindra poetically described the previous fiscal year while addressing M&M shareholders at the company’s recent Annual General Meeting. Describing the ongoing global health pandemic as ‘the worst of times’, the Mahindra leader expressed confidence that the company, and indeed the entire Group, would triumph over current circumstances, just as it had done many times in the past.

Recognizing the immense hardship that people are going through during these Covid times, Mr Mahindra took a moment to praise the efforts of his colleagues who had risen above personal safety concerns to do their part in helping the larger community.

The Group had made available 50 of their Club Mahindra resorts as temporary care facilities. It produced and delivered 1.2 million masks, 400,000 face shields, 70,000 plus litres of hand sanitisers, 600+ aerosol boxes, and provided free meals and cab services for the needy in the fight against Covid-19.

Mahindra employees had certainly risen to the challenge and in doing so, they had helped the Group as well by rapidly developing innovative solutions through an undiluted focus on the challenges at hand. This, Mr Mahindra pointed out, would help the Group companies transition back to the ‘best of times’.

He reminded shareholders that the company had faced severe challenges earlier as well and cited the exceptionally trying situation of 2002 when the share price of Mahindra & Mahindra (M&M) plunged to Rs. 56. The company was removed from the Nifty stock index. However, the company proved its naysayers wrong.

An emergency ‘Blue Chip Conference’ of the top 150 managers of the Group worldwide was called to analyse the business strategy. The reason for the challenges was not hard to find – despite being leaders in their market segment, having global ambitions and innovative abilities – the company lacked financial focus. Mahindra set itself a target of three years to turn things around but achieved the goals in just one year.

“It was an emotional moment for us, when in 2018 we were declared to be the best performing stock on the Nifty since 2002. We have never been short on ambition and that ambition had paid off handsomely,” said Mr. Mahindra.

The anecdote, Mr Mahindra said, emphasised the Group’s ability to recover from the worst of times. And Covid-19 has given the Group time to recalibrate its growth strategies and recommit to achieving key financial goals. Elaborating on the Group’s future business strategy Mr. Mahindra said it was focussed on ambitious growth and preparing for the future by nurturing and investing in businesses that have a potential market capitalisation of over one billion US dollars.

“We see ourselves as a cheetah – fleet of foot, sharp of eye, clearly focused on moving ahead with great speed,” he said, as he expressed cautious optimism that the rising share price of M&M was an indication that this strategy was beginning to pay off.

He reiterated his faith in the Group’s core values – the adherence to Rise and the unshakeable dedication to the principles of good corporate governance. Mr Mahindra concluded by expressing his belief that as long as the Group took these values as its lodestar, it would never have to fear ‘the winter of despair’. With these guiding principles, the Mahindra Group would always be able to move into ‘the spring of hope.”

‘Robust Plans to Regain Growth and Leadership Position’

Undeterred by the financial setback caused by the lockdown imposed in the wake of Covid-19 and other factors, the Mahindra Group had made robust plans to recoup and regain its leadership position. In a recent media interview with CNBC-TV18, M&M’s Deputy MD and Chief Financial Officer, Dr Anish Shah discussed the Group’s future growth strategy.

“First, we would like to get back to business as usual. Second, getting back to Rs. 5,000 crore of cash flow and third, we were the best performing stock on the Nifty for 17 years and we want to get back to that run,” he said.

The company’s farm equipment business reported very strong results during 1Q, FY-21 and the company is in fact struggling to meet demand, despite almost 95% capacity utilisation at the plants. “We look to make a recovery in the farm and auto business in under a year. The third, regaining the 17-year-run as the best performing stock, will take a little more work,” he said.

Stating that the company had commenced an intensive review of all its international businesses, Mr Shah said, “We intend to address all the loss making international subsidiaries by the end of this year.” SsangYong and GenZe had contributed 80% to the Group’s impairments in the January to March quarter. The Group intends to reduce the remaining 20% of impairment on account of international businesses to 2%.

Dr Shah emphasized that the Group will focus on businesses with tangible financial results or strategic benefits. “There will be hard calls on businesses and we may need to exit businesses to get scale and returns,” he said.

Detailing Mahindra’s growth strategy, Dr Shah said, the Group has identified several of its unlisted businesses – including Mahindra Susten, Rural Housing Finance, Powerol, Accelo, Agri, Aftermarket, Classic Legends, Electric, Mobility, and Bristlecone – as growth drivers. Businesses, which have the right to win and the ability to scale, will get more investments.

Underscoring that the list will continue to evolve, Dr Shah said, as subsidiaries show potential for growth and profitability they will be added to this list. As regards the used car business, the Mahindra leader did not rule out a listing of the business describing it as a business with huge potential.

Shah said that Mahindra was hoping to make a complete recovery in the auto segment in the next 3-6 months, subject to a steady supply chain. M&M is looking to strengthen the core of the auto business by leveraging the joint venture with Ford.

“We are ready for the challenge in the SUV segment, we have a 45% market share in the pick-up segment. We have three launches coming up in the large SUV segment over the next 12-15 months,” he said. The company, like other vehicle manufacturers, is also facing supply disruptions due to localized lockdowns.

Commenting on the EV business, Dr Shah said, M&M will remain invested in it but was actively speaking to investors in order to find the right strategic partner. “Electric is here to stay but the timing of the investment has to be right. We are open to a stake sale from the point of view of getting a partner in Mahindra Electric,” he said.

Celebrating the Spirit of Rise

Mahindra & Mahindra released its Integrated Annual Report 2020 at its 74th Annual General Meeting. The report collates a holistic picture of the company’s prospects, covering strategy, governance, performance and forecasts. Integrated reports are broader in scope than the information that is offered in traditional financials focussed annual reports. The Integrated Annual Report conforms to the framework for Integrated Reporting (IR) created to help organisations bring diverse value creating elements together.

The Spirit of Rise

At M&M, the spirit of Rise has been built into the company’s systems over the years. This spirit defines all activities at the Group and acquires special prominence during times of crises. This resilience of Rise empowers the Group to not only resist shocks but also recoup from them and deliver results.

This is M&M’s second annual report that covers six capitals which help drive value creation for all the company’s stakeholders:

1. Financial
2. Marketing
3. Intellectual
4. Human
5. Natural
6. Social & Relationships

The annual report also highlights performance milestones and achievements. In our upcoming issues, we continue to shed light on the various facets of the IAR.

To view the entire IAR please click

A Virtual META Boost for Indian Theatre

The Mahindra Excellence in Theatre Awards (META) is entering its 15th landmark year. The virtual red carpet and awards ceremony to be held on August 30 in a curated virtual environment will include leading theatre personalities, past and present nominees and META awardees.

META, which was instituted to increase awareness of theatre and its appreciation by Indians, is promoted by the Mahindra Group as part of its cultural outreach programme. Curated by Teamwork Arts, a pioneering arts and entertainment company, META recognises and rewards the best of theatre each year – from productions and performances to their makers and facilitators.

META 2020 was originally scheduled to be held in New Delhi in March 2020. The event was postponed in the backdrop of the global pandemic and the subsequent lockdown. “The show must go on,” said Jay Shah, Vice President, Head – Cultural Outreach at the Mahindra Group. “We rise to the challenges thrown up by the pandemic and I applaud the entire theatre community for coming together at this difficult time.”

META 2020 will present awards in 13 competitive categories – best play, best director, best original script, best stage design, best light design, best innovative sound design, best costume, best ensemble, best choreography, best actor and best actress in lead, and supporting roles.

META 2020 received 385 entries across themes, regions, languages, forms, and people earlier this year. Scrutinised by a selection committee, the entries were pruned to 10 nominations which include five productions from Maharashtra, two from Kerala and one each from Assam, Delhi, and West Bengal. Besides Hindi, English, Bengali, Marathi, Malayalam, Assamese, the shortlisted plays even includes a non-verbal play.

The esteemed jury includes stage director and filmmaker Mahesh Dattani, acclaimed playwright and novelist Makarand Sathe, veteran actress and teacher of speech and drama Sushma Seth, actor-director Vinay Pathak and well-known film, television and theatre actor and director, Lillete Dubey. Winners will be announced online.

META 2020 will also include a three-weeklong celebration that includes a theatre critics conference on August 10, which will focus on critical discourse on theatre in the country; the launch of the first-ever edition of META’s ‘Best Original Script’ on August 18, and a tribute to theatre veteran Barry John on August 23. Barry John will be awarded the Lifetime Achievement Award this year.

Watch all the META events on the Facebook handle @MahindraExcellenceinTheatreAwards and on the YouTube METAwards CHANNEL.

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