To the Members,
Your Directors have the pleasure in presenting the 36th Annual Report together with the audited financial statements of the Company for the financial year ended March 31, 2023. The consolidated performance of the Company and its subsidiaries has been referred to wherever required.
During the year under review, the name of the Company has been changed from Motherson Sumi Systems Limited to "Samvardhana Motherson International Limited" and a fresh Certificate of Incorporation was issued by the Ministry of Corporate Affairs on May 18, 2022.
The summarized financial results for the year ended March 31, 2023 and for previous year ended March 31, 2022 are as follows:
Standalone
Consolidated
On consolidated basis for the financial year 2022-23, your Company achieved total revenue from operations of INR 787,007 million as compared to the revenue of INR 637,740 million of the previous financial year ended March 31, 2022 from continuing operations. Net profit for the financial year is at INR 14,956 million as compared to the previous year's net profit of INR 5,096 million.
On standalone basis for the financial year 2022-23, your Company achieved total revenue from operations of INR 73,550 million as compared to its total revenue of INR 54,163 million of the previous financial year ended March 31, 2022 from continuing operations. The profit after tax for the year ended March 31, 2023 is INR 7,735 million as compared to INR 7,996 million of the previous financial year ended March 31, 2022. The operational performance of the Company has been comprehensively covered in the Management Discussion and Analysis Report.
The profit available for appropriation for the year ended March 31, 2023 is INR 36,929 million and being carried over as surplus to the Profit & Loss Account as on March 31, 2023.
The Composite Scheme of Amalgamation and Arrangement was approved by the Hon'ble National Company Law Tribunal, Mumbai Bench vide its order dated December 22, 2021 ("the Scheme").
Pursuant to the Scheme, erstwhile Samvardhana Motherson International Limited (CIN: U74900MH2004PLC287011), i.e., the Amalgamating Company got merged with the Company and Motherson Sumi Wiring Limited, i.e., the Resulting Company got demerged from the Company. Therefore the financial information of the current year is not truly comparable with the previous financial year.
The Management Discussion and Analysis Report for the year under review, as stipulated under the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (the "Listing Regulations") is presented in a separate section forming part of the Annual Report.
A. Equity Share
During the financial year, your Company had allotted 225,88,07,122 equity shares of face value of Re. 1 (Rupee One) each on account of the issue of Bonus Shares on October 6, 2022 in the ratio of 1 (one) equity share against 2 (two) existing equity shares held by the members as on record date. This is tenth time the Company has rewarded its shareholders through a Bonus Issue. Issue of Bonus shares were approved by Shareholders through postal ballot for which results were declared on September 23,2022.
The bonus shares allotted ranks pan passu with the existing equity shares of the Company in all respects.
After the allotment of Bonus Shares, the paid- up capital of the Company increased to INR 677,64,21,366/- (Rupees Six Hundred Seventy Seven Crores Sixty Four Lakhs Twenty One Thousand Three Hundred and Sixty Six only) divided into 677,64,21,366 (Six Hundred Seventy Seven Crores Sixty Four Lakhs Twenty One Thousand Three Hundred and Sixty Six) Equity Shares of Re. 1/- (Rupee One) each.
B. Non-Convertible Debentures ("NCDs")
During the financial year 2022-23, the Company has raised funds, inter-alia, by issue of Non-Convertible Debentures ("NCDs") on a private placement basis allotted on January 23, 2023. The key terms of issuance of NCDs are as below:
The Directors are pleased to recommend for approval of the members a payment of dividend of Re. 0.65 (Sixty Five Paise only) per share (face value of Re. 1/- each) on the Share Capital of the Company for the financial year ended
March 31, 2023 to the equity shareholders.
The dividend, if approved by the members, would involve total cash outflow on account of dividend of INR 4,405 Million resulting in a pay-out of 57% of the standalone profits of the Company and 29% of the consolidated profits of the Company.
The domestic credit ratings obtained during the Financial Year 2022-23, for the Company and all the debt instruments in India are given below:
Domestic Ratings (the Company)
The International credit ratings obtained by the Company and Samvardhana Motherson Automotive Systems Group B.V., Netherlands, ("SMRPBV") are as below:
International Ratings
The details of the credit ratings of the Company are available on its website www.motherson.com.
The Company has neither invited nor accepted any deposits from public covered under Chapter V of the Companies Act, 2013, and as such, no amount on account of principal or interest on deposits from public was outstanding or remained unclaimed or unpaid lying with the Company, as on the date of the balance sheet.
There are no deposits invited or accepted by the Company which are not in compliance with the requirements of Chapter V of the Companies Act, 2013.
In accordance with the Companies Act, 2013 and Ind AS 110 - Consolidated Financial Statements read with Ind AS 28 - Investments in Associates, Ind AS 31 - Interests in Joint Ventures and Ind AS 116 - Leases, the audited consolidated financial statement is provided in the Annual Report.
The performance of the Company on consolidated basis is discussed at length in the Management Discussion and Analysis Report forming part of the Annual Report.
(a) The Board of Directors of the Company in its meeting held on January 27, 2023 approved the Scheme of Amalgamation for Merger of its wholly owned subsidiaries namely Motherson Consultancies Service Limited and Motherson Invenzen Xlab Private Limited and Samvardhana Motherson Polymers Limited and MS Global India Automotive Private Limited. The Company has filed petition with Hon'ble National Company Law Tribunal, Mumbai Bench.
(b) During the financial year, SMR Automotive Mirrors UK Limited, a 100% step down subsidiary of SMRP BV, Netherlands has entered into a Share Purchase Agreement with Ichikoh Industries Ltd., Japan (Ichikoh), for the acquisition of 100% equity share capital held by Ichikoh in Misato Industries Co. Ltd., Japan and Ichikoh (Wuxi) Automotive Parts Co. Ltd., China. The same has been noted by the Company in its Board Meeting held on September 25, 2022.
(c) The Board of Directors of the Company in its meeting held on January 27, 2023 had approved acquisition of 51% stake in Saddles International Automotive and Aviation Interiors Private Limited ("SADDLES"). SADDLES is engaged in manufacturing of premium upholstery for passenger vehicles applications. Further, the closing of said acquisition was completed by the Company on July 13, 2023.
The Company now holds the 51% of equity share capital of SADDLES and accordingly SADDLES is now the subsidiary of the Company.
(d) The Board of Directors of the Company in its meeting held on February 19, 2023 noted the acquisition by SMRP BV, wholly owned subsidiary of the Company to acquire 100% stake in SAS Autosystemtechnik GmbH, Germany from Faurecia, a company of the FORVIA Group.
(e) The Board of Directors of the Company in its meeting held on March 16, 2023 had approved to acquire remaining 50% stake of Fritzmeier Motherson Cabin Engineering Private Limited from F Holdings GmbH, Austria. Further, the said acquisition was completed by the Company on March 20, 2023. The Company now holds 100% of equity share capital of Fritzmeier Motherson Cabin Engineering Private Limited and accordingly Fritzmeier Motherson Cabin Engineering Private Limited is now the wholly owned subsidiary of the Company.
(f) The Board of Directors of the Company in its meeting held on March 27, 2023 approved and noted that SMP Automotive Systems Alabama Inc., USA, had submitted a bid for purchase of asset of Bolta US Ltd., USA. Bolta US Ltd. is engaged in the business of providing injection molding and assembling of components for automotive industry. SMP Automotive Systems Alabama Inc., is an indirect wholly owned subsidiary of SMRP BV, whereas, SMRP BV is a material wholly owned subsidiary of Samvardhana Motherson International Limited.
(g) SMRP BV, a material subsidiary of the Company acquired additional 1.55% shares of Samvardhana Motherson Reflectec Group Holdings Limited ('SMR Jersey'). After the acquisition of aforesaid 1.55% stake, SMR Jersey became 100% subsidiary of SMRP B.V. effective from March 3,2023.
On March 31, 2023, the Company has 204 subsidiaries, 1 associate company and 21 joint ventures and there has been no other material changes in the subsidiaries, associated and joint ventures, except as provided below.
During financial year 2022-23, following changes have taken place in Company's subsidiaries, joint venture or associate companies:
1. Companies which became subsidiaries (direct and indirect) during financial year 2022-23 are as follows:
(a) Subsidiary through incorporation:
(i) Motherson Electronic Components Private Limited was incorporated on March 15, 2023 as an indirect wholly owned subsidiary through Samvardhana Motherson Innovative Solutions Limited.
(ii) Zhaoqing SMP Automotive Components Co, Ltd, was incorporated on November 25, 2022, as an indirect subsidiary through Chanchun Peguform Automotive Plastics Technology Co. Ltd.;
(iii) MSSL Germany Real Estate B.V. & Co. KG, was incorporated on February 28, 2023, as an indirect subsidiary through MSSL GmbH;
(iv) SMP Automotive Ex Real Estate B.V. & Co. KG, was incorporated on February 28, 2023, as an indirect subsidiary through SMP Automotive Exterior GmbH; and
(v) SMP D Real Estates B.V. & Co. KG, was incorporated on February 28, 2023, as an indirect subsidiary through SMP Deutschland GmbH.
(b) Subsidiary through acquisition:
(i) CIM Tools Private Limited effective from April 6, 2022.
(ii) Aero Treatments Private Limited effective from April 6, 2022 through CIM Tools Private Limited.
(iii) Fritzmeier Motherson Cabin Engineering Private Limited, a joint venture of the Company, has become the wholly owned subsidiary of the Company effective from March 20,2023.
2. Companies which ceased to be subsidiaries during financial year 2022-23 are:
(i) SMRC Automotive Holding B.V. (merged with SMRC Automotive Holding Netherlands B.V. with effect from April 1,2022);
(ii) MSSL Manufacturing Hungary Kft, Hungary, an indirect subsidiary of your Company has been closed effective from September 30,2022;
(iii) Motherson Innovations LLC, USA, an indirect subsidiary has been dissolved on June 9,2022;
(iv) Motherson Ossia Innovations LLC, USA, an indirect subsidiary has been dissolved on June 9, 2022;
(v) Samvardhana Motherson Invest Deutschland GmbH (merged with MSSL GmbH with effect from September 6, 2022);
(vi) Motherson Techno Precision GmbH (merged with Motherson Air Travel Agency GmbH with effect from September 9, 2022);
(vii) Shenyang SMP Automotive Component Co. Ltd, an indirect subsidiary of your Company has been deregistered effective from March 20, 2023; and
(viii) Motherson Rolling Stock Systems GB Ltd, an indirect subsidiary of your Company has been liquidated effective from January 26, 2023.
3. Companies which became joint venture during financial year 2022-23 are:
(i) Lauak CIM Aerospace Private Limited effective from April 6, 2022, through CIM Tools Private Limited.
4. Subsidiaries in which Independent Directors of the Company have been appointed as Director
Following are the unlisted wholly owned subsidiaries of the Company in which Independent Directors of the Company were appointed as Director on its Board:
* Material subsidiary in terms of Regulation 16(1)(c) and Regulation 24(1) of Listing Regulations.
# Material subsidiary in terms of Regulation 16(1)(c) of Listing Regulations.
In accordance with section 129(3) of the Companies Act, 2013, the consolidated financial statements of the Company and all of its subsidiaries, associate and joint venture companies form part of the Annual Report. Further, a statement containing performance and salient features of the financial statements of the Company's subsidiaries, associate and joint venture companies is annexed in Form AOC-1, which forms a part of the Annual Report.
Further, pursuant to the provisions of Section 136 of the Act, the financial statements of the Company, consolidated financial statements along with relevant documents and separate audited financial statements in respect of subsidiaries, are available on the Company's website at www.motherson.com.
The Company's exports during the year were INR 15,979 million as against INR 11,733 million in the previous financial year from continuing operations. Further, the consolidated sales of product outside India of entities having operations in India (considering continuing operations) and consolidated in financial statements during FY 2022-23 were INR 689,125 million as against INR 568,520 million in FY2021-22. The Company continues to make its efforts towards achieving higher growth by providing cost competitive quality solutions to its customers. In addition, the Company has facilities globally, to provide service to the customers as well as enhance customer relationships.
The Board of Directors met twelve (12) times during the financial year 2022-23 and the details of same are given in the Corporate Governance Report forming part of this Annual Report. The intervening gap between two consecutive meetings was not more than one hundred and twenty (120) days as prescribed by the Companies Act, 2013 and the Listing Regulations.
During the financial year 2022-23, there was no change in the Board of Director(s) of the Company.
As per provisions of the Companies Act, 2013 and the Articles of Association of the Company, Mr. Pankaj Mital (DIN: 00194931), Director of the Company, is liable to retire by rotation in the ensuing Annual General Meeting ("AGM"). Mr. Pankaj Mital being eligible seeks his re-appointment. Accordingly, the Board of Directors recommends the re-appointment of Mr. Pankaj Mital to the members of the Company.
The shareholding of Sumitomo Wiring Systems Limited (SWS) has reduced from 25.10% as on December, 2021 (i.e., formerly Motherson Sumi Systems Limited) to 14.15% as on March 31, 2023, of paid up share capital of the Company, SWS has now decided to reduce number of its nominee directors on the Board of the Company from two (2) to one (1) director. In this respect, Mr. Shunichiro Nishimura (DIN: 08138608), a nominee of SWS has resigned from the Directorship of the Company with effect from July 18, 2023. Further, the Board of Directors in its meeting held on July 18, 2023 had inducted Mr. Norikatsu Ishida, nominee of SWS as member in the Board Committee(s) in place of Mr. Shunichiro Nishimura.
The Board of Directors has received declarations from all the Independent Directors of the Company confirming that they meet with criteria of i ndependence as prescribed under sub-section (6) of Section 149 of the Companies Act, 2013 and Regulation 16(1)(b) read with Regulation 25 of the Listing Regulations. The Board is of the opinion that they are the persons of integrity and possesses relevant expertise and experience.
During the year, Independent Directors of the Company had no pecuniary relationship or transactions with the Company, other than sitting fees, commission and reimbursement of expenses incurred by them for the purpose of attending meetings of the Board of Directors, Committee(s) and meeting of the Independent Directors. The details of remuneration and/ or other benefits of the Independent Directors are mentioned in the Corporate Governance Report.
The Audit Committee of the Board for the financial year ended March 31, 2023 was comprised of Mr. Gautam Mukherjee as Chairman, Mr. Naveen Ganzu, Ms. Rekha Sethi, Mr. Veli Mati Ruotsala as Independent Directors and Mr. Shunichiro Nishimura, Mr. Laksh Vaaman Sehgal as Non-executive Directors. During the year all the recommendations made by the Audit Committee were duly accepted by the Board.
Further, consequent upon resignation of Mr. Shunichiro Nishimura effective July 18,2023, Mr. Norikatsu Ishida was appointed as member of the Audit Committee effective July 18, 2023. Accordingly, the re-constituted Audit Committee now comprise of the following:
Mr. Gautam Mukherjee - Chairman
Mr. Norikatsu Ishida
Ms. Rekha Sethi
Mr. Naveen Ganzu
Mr. Veli Matti Ruotsala
Mr. Laksh Vaaman Sehgal
Details on Committees constituted by the Board under the Companies Act, 2013 and the Listing Regulations, their composition as well as changes in their composition, if any, during the year and the number and dates of meetings of such Committees held during the Financial Year 2022-23 are covered in Corporate Governance Report which forms part of the Annual Report.
In terms of the provisions of section 2(51) and 203 of the Companies Act, 2013, during the financial year under review the Company has following whole-time Key Managerial Personnel ("KMP"):
(a) The Board of Directors of the Company in its meeting held on April 17, 2023 had approved to acquire additional 30% stake in Youngshin Motherson Auto Tech Limited ("YMAT") from Youngshin Components Co. Ltd., Korea. Further, the closing of said acquisition was completed by the Company on June 2, 2023. The Company now holds the 80% of equity share capital of YMAT and accordingly YMAT is now the subsidiary of the Company.
(b) SMRP BV, a step-down subsidiary of the Company, through one of its European subsidiaries, has signed a binding undertaking to acquire a 100% stake in CIRMA ENTREPRISE, a French societe par actions simplifiee, from Vinci Energies France, a French societe par actions simplifiee. The same has been noted by the Company in its Board Meeting held on June 15, 2023.
(c) MSSL Consolidated Inc., a step-down subsidiary of the Company, has signed an agreement for an investment of USD 14 Million, 12% optionally convertible secured note of Prysm Systems Inc. The same has been noted by the Company in its Board Meeting held on July 4, 2023.
(d) SMRP BV, a subsidiary of the Company has entered into an agreement to acquire 81% stake in Yachiyo's 4W (Y4W) Business housed under Yachiyo Industry Co. Ltd. The same has been noted by the Company in its Board Meeting held on July 4, 2023.
(e) The Board of Directors of the Company in its meeting held on July 7, 2023 had approved to enter into an agreement to acquire 100% stake in Rollon Hydraulics Private Limited.
In terms of the requirement of the Companies Act, 2013 and Regulation 19 read with Schedule II, Part D of the Listing Regulations, the Board carried out an annual evaluation of its own performance, Board Committees, individual Directors including the Independent Directors and the Chairman of the Company on the basis of the criteria specified as per the Guidance Note on Board Evaluation issued by the Securities and Exchange Board of India with the aim to improve the effectiveness of the Board and the Committees.
The criteria for evaluation under different categories depends on the role the person(s)/group(s) plays in the Company. The criteria for every evaluation for the Financial Year 2022-23 was decided at every level depending on the functions, responsibilities, competencies required, nature of business etc., detailed as below:
In a separate meeting of Independent Directors held during the financial year 2022-23, performance of Non- Independent Directors, the Board as a whole and the Chairman of the Company was evaluated, taking into account the views of Executive Directors and Non- Executive Directors. The Independent Directors at their meeting also assessed the quality, quantity and timeliness of flow of information between the Company management and the Board that is necessary for the Board to effectively and reasonably perform their duties.
It was noted that the Board as a whole is functioning as a cohesive body which is well engaged with different perspectives.
The Board Members from different backgrounds bring about different complementarities and deliberations in the Board and Committee Meetings. It was also noted that the Committees are functioning wel and all important issues are brought up and discussed in the Committees as per its terms of reference as mandated by law.
The evaluation process was carried out through a web- based portal. The summary of the evaluation reports was presented to the respective Committees and the Board. The Directors had given a positive feedback on the overall functioning of the Committees and the Board. The suggestions made by the Directors in the evaluation process have been suitably incorporated in the processes.
In the Board Meeting that followed the meeting of the Independent Directors and meeting of Nomination and Remuneration Committee, the performance of the board, its committees and individual directors was also discussed. Performance evaluation of Independent Directors was done by the entire board, excluding the Independent Directors being evaluated.
Pursuant to Section 178(3) of the Companies Act, 2013, the Nomination and Remuneration Committee constituted under the provisions of section 178(1) of the Companies Act, 2013, recommended to the Board of Directors of your Company, a policy on Director's appointment and remuneration, including, criteria for determining qualifications, positive attributes, independence of a Director and other matters. The said policy as approved by the Board of Directors, is uploaded on the Company's website at www.motherson.com. The extract of the said Policy is also covered in Corporate Governance Report which forms part of this Annual Report.
Pursuant to section 134(3)(c) of the Companies Act, 2013 and subject to disclosures in the Annual Accounts, your Directors state as under:
(a) That in preparation of the annual accounts for the financial year ended March 31, 2023, the applicable Accounting Standards have been followed and there are no material departures;
(b) That the Directors have selected appropriate Accounting Policies and applied them consistently and made judgment and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year March 31, 2023 and of the profit of the Company for that period;
(c) That the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
(d) That the Directors have prepared the annual accounts on a going concern basis;
(e) That the Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively; and
(f) That the Directors have devised proper system to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.
Statutory Auditors
As per section 139 of the Companies Act, 2013, read with the Companies (Audit and Auditors) Rules, 2014, the Members of the Company in 35th AGM approved the reappointment of M/s. S. R. Batliboi & Co. LLP, Chartered Accountants, (Firm Registration No. 01003E/IE300005), as Statutory Auditors of the Company for the second term of 5 (five) consecutive years i.e. from the conclusion of 35th AGM till the conclusion of 40th AGM of the Company to be held in the year 2027.
The notes on the financial statement referred to in the Auditors' Report are self-explanatory and do not call for any further comments.
The Auditors Report annexed with this Annual Report, does not contain any qualification, reservation or adverse remarks. During the Financial Year 2022-23, the Auditors have not reported any matter under section 143(12) of the Companies Act, 2013, therefore no detail is required to be disclosed under section 134(3)(ca) of the Companies Act, 2013.
Cost Auditor
The maintenance of cost records as specified by the Central Government under sub-section (1) of section 148 of the Companies Act, 2013, is required by the Company and accordingly such accounts and records have been prepared and maintained by the Company for the financial year 2022-23.
As per recommendation of the Audit Committee, the Board of Directors has appointed M/s. M.R. Vyas & Associates, Cost and Management Accountants (Registration No. 101394) as Cost Auditor for conducting the audit of cost records of the Company for the financial year 2022-23.
During the Financial Year 2022-23, the Auditors have not reported any matter under section 143(12) of the Companies Act, 2013, therefore no detail is required to be disclosed under section 134(3)(ca) of the Companies Act, 2013.
Secretarial Auditor
In terms of section 204 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, based upon the recommendations of the Audit Committee, the Board of Directors had appointed M/s. SGS Associates, Company Secretaries (CP No. 1509) as the Secretarial Auditor of the Company, for conducting the Secretarial Audit for financial year ended March 31, 2023.
The Report given by the Secretarial Auditor is annexed herewith and forms integral part of this Report. There has been no qualification, reservation or adverse remark or disclaimer in their Report.
During the year, the Company had received various awards and recognitions, which have been described in "Awards and Recognition" section, forming part of the Annual Report.
Particulars of loans given, Investments made, guarantees given and securities provided along with the purpose for which the loan or guarantee or security is proposed to be utilized by recipient are provided in the standalone financial statement. Please refer Note No. 6(a), 6(b) and 7 to the standalone financial statements.
Pursuant to Policy on Related Party Transaction of the Company, all contracts/ arrangements/ transactions entered by the Company during financial year with related parties which were on arm's length basis and were in ordinary course of business were approved by the Audit Committee. During the year the Company had not entered into any contract / arrangement/ transaction with related parties which could be considered material for which shareholders' approval is required in accordance with provisions of the Companies Act, 2013.
Pursuant to the provision of applicable Listing Regulations, all related party transactions are placed before the Audit Committee for approval including the transaction under section 188 of the Companies Act, 2013 and regulation 23 of Listing Regulations. Prior omnibus approval of the Audit Committee has been obtained for transactions which are foreseen and repetitive in nature and where the need for related party transaction cannot be foreseen, Audit Committee granted omnibus approval for such transactions having value upto rupees one crore per transaction. The transactions entered into pursuant to omnibus approval were presented to the Audit Committee on quarterly basis by way of a statement giving details of all related party transactions.
The Company has developed a Related Party Transactions Manual, Standard Operating Procedures for purpose of identification and monitoring of such transactions. The policy on Related Party Transactions as approved by the Board and amended from time to time is uploaded on the Company's website.
Your Directors draw attention of the members to Note No. 40 to standalone financial statement which sets out related party disclosures.
Approval of Related Party Transactions pursuant to SEBI Listing Regulations
The Securities and Exchange Board of India ("SEBI") notified SEBI (Listing Obligation and Disclosure Requirements) (Sixth Amendment) Regulation, 2021 on November 9,2021 which were effective from April 1, 2022. The amended provisions of Regulation 23 of SEBI Listing Regulations defines a "material related party transaction" as transaction to be entered into individually or taken together with previous transactions during a financial year by the Company, which exceeds INR 1,000 crore or 10% of annual consolidated turnover of the listed entity, whichever is lower, as per last audited financial statements of the listed entity. Further, such "material related party transactions" require prior approval of shareholders.
In respect of above, the shareholders of the Company at its Annual General Meeting held on August 29, 2022 granted their approval for entering into contract(s) / agreements(s) / arrangement(s) / transaction(s), between the Company with following counter- parties:
(1) Motherson Sumi Wiring India Limited; and
(2) SEI Thai Electric Conductor Co., Ltd., Thailand .
The shareholders of the Company in the said meeting had approved aforesaid related party transactions, as more particularly mentioned in the Notice for the meeting read with the explanatory statement attached thereto pursuant to section 102 of the Companies Act, 2013.
The Notice convening the said meeting along with the voting results can be viewed on the website of the Company at www.motherson.com.
Information under section 134(3)(m) of the Companies Act, 2013, read with rule 8(3) of Companies (Accounts) Rules, 2014 is given in Annexure-A to this Report.
Disclosure pertaining to remuneration and other details as required under section 197 of the Companies Act, 2013 read with rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is given in Annexure-B to this Report.
The Statement containing the particulars of top 10 employees as required under section 197(12) of the Companies Act, 2013 read with rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and other applicable rules (if any), is provided in a separate annexure forming part of this report. Further, the report and the accounts are being sent to the members excluding the aforesaid annexure. In terms of section 136 of the Companies Act, 2013 the said annexure is open for inspection at the registered office of the Company during the working hours for a period of twenty-one days before the date of the AGM. Any member interested in obtaining a copy of the same may write to the Company.
Your Company has taken adequate steps to ensure compliance with the provisions of Corporate Governance as prescribed under the Listing Regulations. A separate section on Corporate Governance, forming a part of Annual Report and the requisite certificate from the Company's Auditors confirming compliance with the conditions of Corporate Governance is attached to the report on Corporate Governance.
Business Responsibility and Sustainability Report:
The Securities and Exchange Board of India vide its circular dated May 10, 2021, made Business Responsibility and Sustainability Report (BRSR) mandatory for the top 1,000 listed companies (by market capitalization) from Financial Year 2022-23.
Pursuant to Regulation 34(2)(f) of the Listing Regulations, BRSR on initiatives taken from an environmental, social and governance perspective, in the prescribed format is available as a separate section of the Annual Report and is also uploaded on the Company's website.
BRSR indicates the Company's performance against the principles of the 'National Guidelines on Responsible Business Conduct'. This would enable the shareholders to have an insight into environmental, social and governance initiatives of the Company.
Dividend Distribution Policy:
As per regulation 43A of the Listing Regulations, the Dividend Distribution Policy of your Company is disclosed in the Corporate Governance Report and the said Policy is also uploaded on the Company's website.
A. EQUITY SHARES
The Equity shares of your Company are presently Listed at the National Stock Exchange of India Limited (NSE) and BSE Limited (BSE).
B. NCDs
The details of NCDs issued and allotted by your Company is as under:
*The NCD issued on 2104.2020 vide ISIN No. INE775A07016 was redeemed on the maturity date i.e. 20.04.2023. The listing fees for the financial year 2023-24 for Equity Shares and NCDs have been paid to the said Stock Exchanges. The Company's equity shares continue to remain listed on NSE and BSE.
The Company has an Internal Control System commensurate with the size, scale and complexity of its operations. To maintain its objectivity and independence, the Internal Audit Reports are presented directly to the Chairman of the Audit Committee and its members.
Details about Internal controls and their adequacy are set out in the Management Discussion & Analysis Report which forms part of this report.
The Board of Directors had constituted Risk Management Committee to assist the Board with regard to the identification, evaluation and mitigation of strategic, operational, external environment and cyber security risks and in fulfilling its corporate governance oversight responsibilities and to develop policy for actions associated to mitigate the risks. The Committee is responsible for reviewing the risk management plan and ensuring its effectiveness. The major risks identified by the businesses and functions are systematically addressed through mitigating actions on a continual basis.
On recommendation of the Risk Management Committee, the Board of Directors of your Company adopted the amended Risk Management Policy for the Company and the said Policy is also uploaded on the Company's website. The development and implementation of risk management policy has been covered in the Management Discussion and Analysis Report, which forms part of the Annual Report.
During the financial year 2022-23 under review, no such order is passed by any Regulators or Courts or Tribunals which would impact the going concern status of the Company and its future operations other than the orders mentioned herein above.
In accordance with the requirements of section 135 of the Companies Act, 2013, your Company has a Corporate Social Responsibility Committee ("CSR Committee"). The CSR Committee comprises of Mr. Vivek Chaand Sehgal, Chairman, Ms. Rekha Sethi, Independent Director and Mr. Laksh Vaaman Sehgal, Non-Executive Director.
The terms of reference of the CSR Committee is provided in the Corporate Governance Report. Your Company has also formulated a Corporate Social Responsibility Policy (CSR Policy). The Board of Directors in its meeting held on May 26,2022 amended its CSR Policy considering the changes made by Ministry of Corporate Affairs. The CSR Policy is available on the website of the Company at www. motherson.com.
Annual report on CSR activities as required under the Companies (Corporate Social Responsibility Policy) Rules, 2014 has been appended as Annexure-C and forms integral part of this Report.
The Company is, inter-alia, also performing CSR activities through Swarn Lata Motherson Trust which has been established for the sole purpose of CSR activities. Further, the Company continue to carry out CSR activities as specified under schedule VII to the Companies Act, 2013.
The Company has established a vigil mechanism which incorporates a whistle blower policy in terms of the Companies Act, 2013 and the Listing Regulations for Directors and employees to report their genuine concerns. The objective of the Policy is to create a window for any person who observes an unethical behaviour, actual or suspected fraud, or violation of the Company's Code of Conduct or ethics policy (hereinafter "Unethical and Improper Practices"), either organizationally or individually, to be able to raise it and to provide for adequate safeguards against victimization of whistle blower and also to provide for direct access to the Chairperson of the Audit Committee.
Thought Arbitrage Consultancy has been appointed by the Board of Directors as an independent external ombudsman under this Whistle-blower Mechanism.
Protected Disclosure can be made by a Whistle Blower through an e-mail or dedicated telephone line or a letter to the Thought Arbitrage Consultancy or to the Chairman of the Audit Committee. The Whistle Blower Policy is available on the Company's website at www.motherson. com.
In accordance with the provisions of Section 92(3) read with section 134(3)(a) of the Companies Act, 2013 and Rule 12 of the Companies (Management and Administration) Rules, 2014, the annual return in the prescribed format for the financial year 2022-23 is available on the website of the Company at www.motherson.com.
Your Company has complied with the secretarial standards with respect to General and Board Meetings respectively, as specified by the Institute of Company Secretaries of India constituted under section 3 of the Company Secretaries Act, 1980 (56 of 1980), and approved as such by the Central Government.
The relations with the employees and associates continued to remain cordial throughout the year. The Directors of your Company wish to place on record their appreciation for the excellent team spirit and dedication displayed by the employees of the Company.
The Company has zero tolerance towards sexual harassment at the workplace and has adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules thereunder.
The Company has complied with provisions relating to the constitution of Internal Complaints Committee under Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 ("POSH Act"). The Internal Committee composed of internal members and an external member who has extensive experience in the field.
During the financial year 2022-23, there were two (2) complaints filed under the provisions of POSH Act. After the enquiry into these matters, required punishment of temporary suspension and termination been awarded to accused.
Notice of the AGM along with the Annual Report 2022- 23 is being sent only through electronic mode to those Members whose email addresses are registered with the Company/ Depositories. Members may note that the Notice and Annual Report 2022-23 will also be available on the Company's website www.motherson.com. websites of the Stock Exchanges i.e. BSE Limited and National Stock Exchange of India Limited at www.bseinclia.com and www.nseindia.com respectively. The above are in compliance with General Circular No. 14/2020 dated April 8, 2020 read with General Circular No. 17/2020 dated April 13, 2020, General Circular No. 20/2020 dated May 5, 2020, General Circular No. 22/2020 dated June 15, 2020, General Circular No. 33/2020 dated September 28, 2020, General Circular No. 39/2020 dated December 31, 2020, General Circular No. 02/2021 dated January 13, 2021, General Circular No. 20/2021 dated December 08, 2021, General Circular No. 2/2022 dated May 5,2022 and General Circular No. 10/2022 dated December 28, 2022, issued by the Ministry of Corporate Affairs.
Your Board of Directors would like to place on record their sincere appreciation for the wholehearted support and contributions made by all the employees of the Company as well as customers, suppliers, bankers, investors and other authorities. Our consistent growth was made possible by their hard work, solidarity, cooperation and support.
The Directors also thank the Government of various countries, Government of India, State Governments in India and concerned Government Departments/ Agencies for their co-operation, support and look forward to their continued support in the future.
Last but not the least the Board of Directors wish to thank all the stakeholders of the Company and Sumitomo Wiring Systems Limited, Japan for their continuous support.