sundaram clayton ltd share price Directors report

The Directors have pleasure in presenting the 61st Annual Report and the audited financial statements for the year ended 31st March 2023.


($ in Cr)

Particulars Year ended 31.03.2023 Year ended 31.03.2022
Revenue from Operations 2,073.96 1,743.27
Other Income 132.76 93.59
Profit / (loss) before Depreciation, Finance Costs, Exceptional items and Tax Expense 381.73 324.54
Less: Depreciation / Amortization / Impairment 99.94 101.74
Profit / (loss) before Finance Costs, Exceptional items and Tax Expense 281.79 222.80
Less: Finance Costs 45.82 44.91
Profit / (loss) before Exceptional items and Tax Expense 235.97 177.89
Add / (less): Exceptional items (17.10) * (19.75) *
Profit / (loss) before Tax Expense 218.87 158.14
Less: Tax Expense (Current & Deferred) 53.58 23.80
Profit / (loss) for the year 165.29 134.34
Other Comprehensive Income / (loss) 3.37 (3.12)
Total Comprehensive Income 168.66 131.22


* Exceptional item excludes interest on fixed deposits amounting to $ 111.87 Crs and interest expense on Bonus 9% Cumulative Non-Convertible Redeemable Preference Shares (NCRPS) amounting to $ 4.05 Crs for the year 2022-23 and profit on sale of shares (including interest on fixed deposits) amounting to$ 2,142.35 Cr for the year 2021-22.

Profit Before Tax (PBT) including the above exceptional items works out to

$ 326.69 Cr for the year 2022-23 and $ 2,300.49 Cr for the year 2021-22.


The Board of Directors of the Company (the Board) at their meeting held on 25th January 2023, declared an interim dividend of $ 59/- per share (1180%) on 2,02,32,085 equity shares of $ 5/- each for the year 2022-23 involving an outgo of $119.37 Cr. The same was paid to the members on 10th February 2023.

The Board does not recommend any further dividend for the year under consideration. The dividend pay-out is in accordance with the Companys Dividend Distribution Policy.

The Board is not considering any transfer of amount to General Reserves for the year under review, as it is not mandatorily required.


Indian economy:

Indias real Gross Domestic Product (GDP) grew by 7.0% in FY23 as against a growth of 8.7% in FY22. The high real GDP growth rate of

13.5% in Q1 FY23 was moderated by low single digit growth rates in Q2, Q3 and Q4 of FY23 amid high inflationary pressures globally led to large spike in prices of energy & commodities. RBI estimated the FY23 inflation in India at 6.7%.

World Bank estimates the World economies GDP growth at 2.9% in 2022 against the growth rate of 5.9% in 2021. This slowdown in growth was attributed to the concerted significant interest rate hike actions by the central banks across all the major economies to control inflation.

US economy:

The US recorded GDP growth of 0.9% in 2022 compared to the growth of 5.7% in 2021. Retail spends remained strong during the year, despite inflation reaching as high as 9.1% in June 2022 before easing to 6.0% in February 2023. However, the housing demand tapered during the second half of the year.

EU economy:

The EU GDP grew at 3.6% in 2022 compared to the growth of 5.2% in 2021. Inflation in the EU area touched a high of 10.6% during the year due to steep increases in energy prices, mainly Natural Gas prices, which touched a high of USD 70 per million metric British Thermal Unit (mmbtu). Natural Gas prices in EU averaged around USD 37 per mmbtu in 2022 compared to the 10-year long-term average of USD 7 per mmbtu.

Companys Performance:

The Company posted its best ever performance both in turnover and profit terms during the year by focusing on making systemic improvements across the organization, by improving productivity & quality and by delivering the products to the customer on-time. This is despite the adverse macro-economic factors, moderate improvement in supply of semiconductors for the automotive sector and intermittent spikes in COVID infections in China.

The following table highlights the performance of the Company during FY 2022-23:

FY FY Growth
2022-23 2021-22 (in %)
Sales (Tonnage) 43,315 38,982 11
Sale of goods ($ in Cr) 1,979.66 1,648.67 20
Domestic sales ($ in Cr) 1,060.86 868.57 22
Export sales ($ in Cr) 918.80 780.10 18
Profit before Tax ($ in Cr) 218.86 158.14 38

The revenue of the Company is derived from Medium & Heavy Commercial Vehicles (MHCV) segment (61%), followed by Two-wheeler segment (21%) and the Passenger Vehicle segment (18%).




The segment wise performance in the Indian automotive industry is given in the following table.

(Figures in 000 nos)

FY FY Growth
Category 2022-23 2021-22 (in %)
Two Wheelers 19,443 17,909 9
Passenger Vehicles 4,108 3,272 26
Commercial Vehicles
(M&HCV) 372 273 36


(Source: SIAM+DICV internal estimate)

Despite shortage of semiconductors, supply chain uncertainties, high logistics costs and rising commodity prices, the Indian automotive industry performed better than expected during the year FY23.

While Government spending on infrastructure projects improved the demand for MHCVs, improvement in personal mobility resulted in increased demand for passenger vehicle demand. In two-wheeler segment, domestic demand was healthy despite witnessing sharp changes over the quarters, but the exports demand was affected by liquidity crunch, currency devaluations and country specific local socio-political and economic disturbances.

Despite external pressures, Indias service exports have continued to increase. The agricultural sector grew by 3.5%, and also strengthened Company?s position as a net exporter of agricultural products.

In fiscal 2023, the overall growth of rural was slower than urban due to relatively slower recovery in the rural non-agricultural sector.


The following table highlights the North American and European truck registration figures in vehicle units: (Figures in 000 nos)

Market Category CY 2022 CY 2021

Variance (in %)

North America Class 8 Trucks 310 271 14
North America Class 4-7 Trucks 247 266 (7)
Heavy trucks
Europe 290 270 7


(Source: FTR & ACEA)

North America: The Class 8 trucks sales were strong in 2022 despite a slow start in Q1 2022. Although high inflation and interest rate hikes were major threats to the Class 8 truck demand, their sales registered a growth of 14% in 2022 and defied the recession fears due to high pent-up demand, fleet replacement, strong consumer spending and stable freight rates. The global truck manufacturers circumvented the semiconductors shortages by re-allocating semiconductors from other segments (Class 4-7) and by developing technical solutions that allowed interchangeability of semiconductors.

Europe: In the EU markets, heavy commercial vehicles (>16 Ton category) registered a decent growth of 7% in 2022 compared to 2021. Within the regions largest markets, only Germany remained in negative territory (-0.9%), while all the other high-volume EU markets for heavy trucks recorded growth in 2022: Spain (+13.6%), Poland (+6.6%), Italy (+5.1%) and France (+2.3%). However, the numbers were still below the pre-pandemic levels of 2019.


The business environment is expected to be challenging in export markets and healthy in India during 2023. The Company is optimistic about its future considering the following scenario in all major markets that are of interest to the Company.

India :

The Government allocated higher budget to infrastructure development projects. In the Budget 2023-24, the Government has increased the outlay for capital expenditure (capex) on infrastructure sector by 33 per cent from $ 7.5 lakh crore to $ 10 lakh crore. Current Account Deficit (CAD) of India is projected to be around 2.3% of GDP in FY23 and further narrow down in FY24 on the back of increasing services export. Rainfall is expected to be normal and inflation is expected to be within the comfort range of RBI and GDP growth rate in FY24 is expected to be in the range of 5.8% to 6.5%.

In the medium term, there are various initiatives in place to continue Indias growth momentum. Production Linked Incentives for Automotive & Auto Component sector & other sectors are expected to strengthen the manufacturing sector in India, continuation of FAME scheme to transition to EV and special focus on setting up semiconductor manufacturing in India are going to be major drivers for Auto industrys growth.

In FY24, the sales of Passenger Vehicle and Commercial Vehicle segments in India are expected to register around 10% growth and the sales of Two-wheelers are expected to grow by around 5%.

Global scenario:

Global GDP growth rate is expected to decelerate to 1.7% in 2023 from 2.9% in 2022, due to geopolitical strife that emerged last year though localized had global ramifications. This specter of strife hangs over the global economy and trade, which impacted all major commodity prices and cross border trade.

The recent banking crisis is also expected to have an impact on global growth. Central banks across the globe are now increasing the interest rates to rein the high inflation that was not seen in the last few decades.

North America:

In 2023, the US economy is expected to maintain the GDP growth rate of around 0.7%, similar to the growth rate of 2022. The Fed raised interest rates by 425 basis points in 2022 and by an additional 50 basis points as of March 2023. Fed may tighten the supply of money by raising the interest rates vice-versa at a slower rate, to rein in inflation. Therefore, the US Class 8 truck market volumes are expected to be almost flat in 2023.

Europe :

EU economy is still facing the headwinds due to high energy prices, despite some moderation in prices since January 2023. The European Central Bank has increased the interest rates by 250 basis points in 2022 and an additional 100 basis points as of March 2023 to control inflation. The economic activity is expected to be muted in EU with no GDP growth in 2023, however, the chances of de-growth appear low as of now. Consequently, the sales of EU heavy commercial vehicles (>16 Ton category) in 2023 are expected to be same as those in 2022 with no growth or minimal de-growth.

To summarize the export market outlook, the truck industry in the US and the EU is expected to witness a low single digit growth in 2023.


The Company supplies aluminium castings for commercial vehicles, passenger cars and two-wheeler segments of the automotive industry.

In the long term, technology changes such as stringent emission norms, fuel economy regulations, adoption of alternate drivetrain technologies, etc., are the major challenges the industry needs to tackle. Global truck manufacturers are already offering zero emission vehicles in the US and the EU. However, the thrust towards light-weighting and zero emission vehicles is bound to increase leading to higher content of aluminium in all vehicle types. This shift to zero emission vehicles provides increased growth opportunities to the Company and it is well placed to leverage these emerging opportunities, being a preferred source for aluminium castings to major OEMs in India, the US and the EU.

Many companies are expected to move out of China, which is a major source of supplies for automotive parts. This is expected to provide additional growth opportunities to the Company.

OEMs are estimating carbon footprint in every leg of their supply chain in an effort to move towards net zero emissions and would eventually reorganize their global purchasing strategies, which could result in a strong push for localization to cut down their carbon footprint. The threat to business from this potential change in sourcing policy is mitigated as the Company has already set up a manufacturing in the US. The Company is closely monitoring these developments and will act to capitalize on business opportunities to ensure continued growth. The Company is also taking various green initiatives across its manufacturing sites and working to use more renewable energy in its manufacturing processes as part of its sustainability measures.

Several Indian die casting companies and OEMs have set up or have been setting up new capacities over the past few years. The Company will be continuing its actions to secure new businesses to ensure better utilization of assets despite the increased competition and cost pressure.

Intense competition makes it extremely difficult to seek price increases to compensate the effects of inflation bringing the margins under severe pressure. However, the Companys supply contracts provide for periodic price adjustments indexed to the domestic and international prices of aluminium and this should offer some protection against volatility of commodity prices. The Company is practicing strong cost reduction initiatives including VA/VE to mitigate the margin pressures.


Macroeconomic risks

There are several possible risks on the horizon, both global and domestic level. In India, rural recovery continues to be slow, and this significantly impacts the growth trajectory of the economy. Less than normal monsoon may also lead to a weaker performance of the rural agricultural sector impacting the already weakened rural demand. Further the economic recovery could be hampered due to any increase in oil & gas price. The above stated factors can create disruption to an already fragile global trade & supply chain situation, increased inflation, and dampen the demand.

Industry and Company specific risks

The truck sales in the US and the EU are expected to witness no growth or low single-digit growth in 2023.

In India, increase in manufacturing activity, steady agricultural output, and the governments increased spending on infrastructure and moderated freight costs are all expected to drive the demand. But disruptions like semiconductor shortages and increased raw material prices could constrain the supply.

Significant unfavourable movement in prices of key raw material, aluminium, in global markets is one key factor that can affect the profit margins of the Company. The aftermath of COVID led supply chain disruptions and increase in power tariff domestically are major factors that can impact financial performance in FY24. The management is continuously monitoring the costs of raw material & logistics and taking appropriate cost reduction measures or contract price negotiations to maintain and improve the profit margins.


With significant exports, import of raw materials and capital goods, the Company is always exposed to impact on account of currency fluctuations. However, the Company has a well-defined forex hedging policy to mitigate the risks.


The stipulation and requirements of the automobile industry demands high quality products. Robust quality management systems meeting international standards like IATF 16949 are in place to ensure excellent product quality. Additionally, the Company has also taken appropriate recall and product liability insurance in line with standard industry practice.

Just-in-time delivery is another important contractual obligation. Robust quality and project management systems are in place to avoid delay in deliveries due to quality issues or project implementation.

Capacity utilization

The Company adds capacity as required, in existing and new locations, to meet the projected demand of customers. The Company closely monitors the progress of customer projects / volumes and appropriately deploys the assets to protect from both underutilization and capacity shortages to meet the demand.

Risk Management Policy

The Board has established a Risk Management Policy which formalizes the Companys approach to overview and manage material business risks. The policy is implemented through a top down and bottom-up approach for identifying, assessing, monitoring and managing key risks across the Companys business units.

Companys risk management framework is well embedded and continually reviewed by the Risk Management Committee. The Committee is regularly reporting to the Board that the Companys risk management and internal compliance and control system is operating efficiently and effectively in all material respects.

The Board is satisfied that there are adequate systems and procedures in place to identify, assess, monitor and manage risks. The Audit Committee also reviews reports by members of the management team and recommends suitable action. Risk Mitigation Policy has been approved by the Board.


The Board is accountable for evaluating and approving the effectiveness of the internal controls, including financial, operational and compliance. The Company has a proper and adequate internal control system to ensure that all the assets of the Company are safeguarded and protected against any loss and that all the transactions are properly authorized and recorded. Information provided to management is reliable and timely and statutory obligations are adhered to.

Company is strengthening the controls by leveraging technology and centralizing processes, enhancing monitoring and maintaining effective tax and treasury strategies. The Audit Committee continues to monitor the effectiveness of internal control through the use of new technologies that impact the financial controls and reporting enterprise risk.

Internal Financial Controls

The Company has an established Internal Financial Control framework including internal controls over financial reporting, operating controls and anti-fraud framework. The framework is reviewed regularly by the management and tested by internal audit team and presented to the Audit Committee. Based on periodical testing, the framework is strengthened, from time to time, to ensure adequacy and effectiveness of Internal Financial Controls.


A. Manufacturing

The Company has been using Total Quality Management (TQM) as the foundation of its management. The Company implemented the best practices like Total Productivity Management (TPM) and Lean Manufacturing (TPS) in its manufacturing facilities. During FY23, the Company continued working with mentors to improve its systems and processes. Significant aspect of the same is to synchronize Company?s operations with customer demand. This will bring in better planning and execution system along with control over inventories in the pipeline. It also has in place best-in-class practices for safety, pollution control, work environment, water and energy conservation.

Continuous improvement projects are implemented for betterment of the product quality and operational efficiency in all the manufacturing locations. Re-energizing TPM practices helped in improving the equipment reliability and consequently plant Overall Equipment Effectiveness (OEE). The Company has also initiated various projects towards deploying Industry 4.0 practices through connected machines. This will be scaled up in the coming years and is expected to bring significant gains in operational efficiencies across manufacturing locations.

The Companys journey of achieving manufacturing excellence was recognized and rewarded by the following customers during FY23.

• Cummins - Customer support Excellence Award - Direct sourcing for the year 2021.

• DAF - Recognized SCL in "Leaders category". SCL is one among 17 suppliers globally to be selected for this recognition for the 3rd consecutive year.

• Ford - Awarded for Quality and Flow for Panther 2.0 L engine launch.

• Hanon - Awarded as the Best Quality Consistent supplier.

In addition, the Company has also received Best Foundry Award in large scale category at the casting industry event, ALUCAST 2022.

In line with the Companys vision, work is being done on developing several futuristic technologies that will bring value to the customer. One such technology that is now being offered to customers is the Abrasive Flow Machining (AFM) process for which patent is owned in USA and EU. New orders are being given for the AFM technology and our customers are delighted with our R&D facilities and technologies.

B. Quality

Achieving customer delight by consistently providing products of excellent quality is the prime motto of the Company. This is achieved through state-of-the-art technology, training, effective quality system, continuous improvement and total employee involvement.

Poka-yokes, process audits, use of statistical tools for process optimization and online process controls also contribute towards improving and achieving consistency in product quality. During the year special focus has been given on advanced statistical methods and widespread use of Taguchi DOE methodology to further improve the product quality. The quality system is certified for IATF 16949 requirements.

TQM is a way of life in the Company. 100% employee involvement has been successfully achieved for many years.

Employees have completed 362 projects by applying statistical tools through Quality Control Circles (QCC) in FY23. The average number of suggestions implemented per employee was 44.

C. Cost Management

Cost management is a continuous journey, and the Company manages the same through rigorous deployment, monitoring and control of costs across all departments. Cross functional teams are working on projects focussed on Value Added / Value Engineering (VA/VE) and improving operational efficiency. TPM and Lean initiatives are deployed Company-wide to achieve reduction in manufacturing cost. Given the cost pressures due to the current inflationary pressures, significant cross functional team working ensured mutual cross learning and fast horizontal deployment of ideas/projects across our manufacturing locations.

D. Information Technology

The Company uses ERP system that integrates all business processes across the Company. Suppliers and customers are also integrated into the system for better planning and execution. During FY23, IT road map for organization was laid out and deployment of Industry 4.0 projects was initiated to monitor, control and improve manufacturing processes and quality. The Industry 4.0 projects have progressed as per plan and selected cells in all the factories are connected. The Company worked with external agency during the previous financial year and improved the cyber security controls and mechanisms achieving a score of 3.62 / 5.0 and placing it amongst the leaders in the auto component industry. The cyber security program with external agency is ongoing to sustain and improve the security controls. As we move towards digitalization of our processes and systems, special focus is being given to enhance the Information Security of our networks with a special emphasis on cyber security aspects. These digitalization measures across various functions will ensure all the processes and systems are optimised and aligned to deliver customer delight.


As required under Regulation 34 of the Listing Regulations, details of changes in some of the ratios, as compared to the previous year are given below:

Unit of Standalone Consolidated
Particulars measurement 2022-23 2021-22 2022-23 2021-22
Return on Networth $ % 30.47 23.91 20.97 16.12
Net Debt to Equity ** % 0.93 0.25 3.75 2.20
Interest Service Coverage Ratio $ Times 8.53 7.57 11.57 6.87

$ The ratios have improved in the current year, predominantly due to higher profits driven by better operational performance. ** Due to capitalisation of reserves for issue of bonus preference shares.


The Company had issued and allotted 1,000 unsecured, redeemable, non-convertible debentures (NCD) of face value of $ 10 Lakhs each on 18th August 2020 aggregating to $ 100 Crores at 7.65% p.a. and redeemable in equal instalments at the end of 4th year and 5th year. The NCDs were listed with National Stock Exchange of India Limited (NSE) on 25th August 2020.


The Company considers employees as vital and most valuable assets. Human Resource Development (HRD) is aligned to business needs to enhance business performance and results. HRD is practiced through an overall HRD framework with its constituents as resourcing, employee engagement, performance & compensation management, competency- based development, career & succession planning and organization development. Each of these constituents has a structured approach and process to deliver.

As a part of the long-term strategy of the Company, collaborative education program has been initiated with three reputed institutes to develop role-ready engineers with Company-specific knowledge at the entry level. The Company also revamped and launched the yellow belt and green belt programs during the year along with various other systems-oriented training programs. This is expected to not only help solve chronic problems faced on the shop floor but also help in building the competency of our engineers in structured problem solving.

Career development workshop is conducted to identify high potential employees. Such employees are groomed for taking up higher responsibilities. A reward and recognition systems are in place to motivate and also provide fast track growth for the high potential employees.

Our engineers and executives are sponsored for advanced study offered by both Indian and foreign institutions. Customized technical and leadership competency improvement programs are developed and delivered through reputed institutions.

The Company continuously measures and reports employee engagement every year and identifies improvement areas to work on.

An excellent industrial relations environment continues to prevail at all the manufacturing units of the Company.


The Company is fully committed towards employee safety. Safety management is integrated with the overall Environment, Health and Safety (EHS).

The Company has been certified under Integrated Management System (IMS) combining ISO 14001 and ISO 45001 systems and procedures.

The Company is working on its Sustainability roadmap by engaging with a reputed external agency. The Company has already mapped the carbon footprint of its Indian operations and is now working on detailed roadmap with actions to achieve carbon neutrality.


Statements in the Management Discussion and Analysis Report describing the Companys objectives, projections, estimates and expectations may be "forward looking statements" within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make a difference to the Companys operations include, amongst others, economic conditions affecting demand / supply and price conditions in the domestic and overseas market in which the Company operates, changes in the Government Regulations, Tax Laws and Other Statutes and Incidental Factors.




The Board at its meeting held on 9th February 2022 has approved the above Composite Scheme of Arrangement ("Composite Scheme") of the Company, on the recommendation of the Audit Committee and Independent Directors at their respective meetings held on that date. The Company had filed the Scheme with the Stock Exchanges viz., BSE Limited ("BSE") and National Stock Exchange of India Limited ("NSE") for "No Objection".

The Scheme provides for the following Parts:

(i) Part I- Deals with definitions, share capital and date of taking effect and implementation of the Scheme;

(ii) Part II - Deals with the issue of Non-Convertible Redeemable Preference Shares ("NCRPS") of the Company by way of bonus to the shareholders of the Company by utilising the general reserves / retained earnings;

(iii) Part III - Deals with the amalgamation of the TVS Holdings Private Limited ("TVSH") with the Company and cancellation of the share capital of the Company held by the TVSH and the consideration thereof;

Further the name of the Company shall stand changed to "TVS Holdings Limited".

(iv) Part IV - Deals with the amalgamation of VS Investments Private Limited ("VSIPL") with the Company and cancellation of the share capital of the Company held by the VSIPL and the consideration thereof; and

(v) Part V - Deals with the demerger, transfer and vesting of the Demerged Undertaking (as defined in the Scheme) from the Company into Sundaram-Clayton DCD Limited ("SCL DCD") on a going concern basis, reduction and cancellation of the paid-up share capital of SCL DCD held by the Company and the consequent issue of shares of SCL DCD by SCL DCD to the shareholders of the Company.

Post Demerger, the name of SCL DCD shall stand changed to "Sundaram-Clayton Limited".

During the year under review, NSE and BSE by their respective letter dated 29th July, 2022, issued to the Company their "No Objection" on the Scheme, and based on their No Objection, the Company filed an application with Honble National Company Law Tribunal, Chennai Bench, ("Honble NCLT") for approval of the Composite Scheme.

Honble NCLT vide their Order dated 9th November, 2022, directed to convene the meetings of the Equity Shareholders, Unsecured Creditors of the Company, and Secured Creditors of VSIPL, on 16th December, 2022 ("NCLT Convened Meeting") for their approval. Pursuant to the directions of Honble NCLT, the NCLT Convened Meetings were held, and the resolutions were passed with requisite majority. Post the approval of the shareholders and creditors, the Company filed a petition with Honble NCLT, and the Composite Scheme was sanctioned vide its Order dated 6th March, 2023.

The Board at its meeting held on 13th March, 2023, noted the Honble NCLTs Order and the first part of the Composite Scheme was made effective on 14th March, 2023. The Board also authorised the issuance of bonus NCRPS, by fixations of Record Date 1 as 24th March, 2023, for the purpose of determining the eligible shareholders of the Company.

The Company has made an application for seeking listing and trading approvals for the above NCRPS to the Stock Exchanges, and the Company has received the in-principle approval of NSE vide letter dated 27th April, 2023. Approval from BSE is awaited. Further, the listing and trading approvals will be provided, subject to the relaxation granted by SEBI under sub-rule (7) of Rule 19 of Securities Contract (Regulation) Rules, 1957.

The Company will intimate to the Shareholders on further developments in connection with other Parts of the Composite Scheme.


In accordance with the provisions of Section 134(5) of the Companies Act, 2013, (the Act, 2013) with respect to Directors Responsibility Statement, it is hereby stated that -

i. in the preparation of annual accounts for the financial year ended 31st March 2023, the applicable Accounting Standards had been followed along with proper explanation relating to material departures, if any;

ii. the Directors had selected such accounting policies and applied them consistently and made judgments and estimates that were 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 and of the profit of the Company for the year under review;

iii. the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

iv. the Directors had prepared the accounts for the financial year ended 31st March 2023 on a "going concern basis";

v. the Directors, had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and

vi. the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.


CSR activities have already been textured into the Companys value system through Srinivasan Services Trust (SST), established in 1996 with the vision of building self-reliant rural community.

Over 27 years of service, SST has played a pivotal role in changing lives of people in rural India by creating self-reliant communities that are models of sustainable development. The Committee formulated and recommended a CSR Policy in terms of Section 135 of the Act, 2013 along with a list of projects / programmes to be undertaken for CSR spending in accordance with the Companies (Corporate Social Responsibility Policy) Rules, 2014. The projects / programmes undertaken by SST and other eligible Trusts are falling within the CSR activities as specified under Schedule VII to the Act, 2013.

Based on the recommendation of the CSR Committee, the Board has approved the projects / programmes carried out as CSR for an amount of $ 45 lakhs for undertaking similar programmes / projects constituting more than 2% of the average net profits of the Company, made during the three immediately preceding financial years, towards CSR spending for the financial year 2022-23 and the Company has met the CSR spending through SST. Chief Financial Officer (CFO) of the Company has also ensured the spending through SST for FY 2022-23.

The work, SST has been doing, has matured into a model centered on community participation in all its projects. It follows an integrated, holistic and participatory approach to village development, working very closely with the communities and the Government. SSTs focus is to bring about sustainable development in villages. The key focus areas are women empowerment, repairing and renovating the village government infrastructure like the balwadis, primary schools, health centres and veterinary centres, creation of water conservation structures, desilting of water bodies and preserving the environment. SST encourages the community to alter their attitudes and take ownership of changes that bring about lasting development.

To bring in expertise in specific intervention areas like education, health and hygiene, SST is working in collaboration with organizations like Agastya International Foundation, Villmart, Navsahyog Foundation and Gramalaya.

All of the projects undertaken through SST, are within the limit of

$ 1 Cr individually, and do not require impact assessment.

However, an impact study carried out by Institute of Rural Management (IRMA), Anand has revealed that in the villages in Tiruvannamalai District, where SST has been working show a household income growth of about 141% in 5 years (2017-2022) as compared only to an 38% household income growth in neighbouring areas.

The study also highlights the overall behavioural changes in the community in their approach to development in being more independent and adopting sustainable approaches rather than over dependence on external factors to bring about the change.

Another study by the Centre for Water Resources (CWR), Anna University on 3 minor irrigation (MI) tanks in Krishnagiri, Tiruvannamalai and Tirunelveli districts revealed that partial desilting of water bodies has made the water available for more than one cropping season, 79% of farmers adopted changes in the cropping pattern and cultivating more than one season. The underground water storage capacity has improved and there is an increase in water level in bore wells and open wells in the area.

As required under Section 135 of the Act, 2013 read with Rule 8 of the Companies (Corporate Social Responsibility Policy) Rules, 2014, the annual Report on CSR, containing the particulars of the projects / programmes approved and recommended by the CSR Committee and approved by the Board for the financial year 2022-23 are given by way of Annexure IV attached to this Report.

It may also be noted that the CSR Committee has approved the projects or programmes to be undertaken by the SST and other eligible trusts for the year 2023-24, preferably in local areas including the manner of execution, modalities of utilisation of funds and implementation schedules and also monitoring and reporting mechanism for the projects or programmes, as required under the Companies Amendment Act, 2020.



During the year under review, the Company had additionally acquired 50.05% stake in Sundaram Holding USA Inc., USA (SHUI) from Sundaram Auto Components Limited (SACL), a subsidiary of the Company on 22nd September 2022, thereby it became a wholly owned subsidiary of the Company effective that date.

Consequent to the above acquisition, the Companys holding in SHUI increased to 100% and thereby SHUIs subsidiaries in USA viz., Green Hills Land Holding LLC, Component Equipment Leasing LLC, Sundaram-Clayton USA LLC and Premier Land Holding LLC have also become wholly owned subsidiaries of the Company.

The Company had also acquired 25,000 shares of EUR 1/- each in Sundaram-Clayton GmbH (SCL GmbH), Germany, effective 8th February 2023, thereby it became a wholly owned subsidiary of the Company. SCL GmbH is incorporated with the objective of establishing an engineering design centre.

The following companies and bodies corporate are the subsidiaries / associates of the Company:


1. TVS Motor Company Limited, Chennai (TVSM)

2. Sundaram-Clayton (USA) Limited, USA

3. Sundaram-Clayton DCD Limited, Chennai

4. Sundaram Holding USA Inc, Delaware, USA

5. Sundaram-Clayton GmbH, Germany (from 08.02.2023)

Subsidiaries of TVSM

1. TVS Credit Services Limited (TVSCS), Chennai

2. Sundaram Auto Components Limited (SACL), Chennai

3. TVS Housing Limited, Chennai

4. TVS Motor Services Limited, Chennai

5. Intellicar Telematics Private Limited, Bengaluru (Intellicar)[upto 24.05.2022]

6. TVS Electric Mobility Ltd, Chennai

7. PT TVS Motor Company Indonesia, Jakarta.

8. TVS Motor (Singapore) Pte. Limited, Singapore (TVSM Singapore)

9. TVS Motor Company (Europe) B.V., Amsterdam

Subsidiaries of TVS CS

10. Harita ARC Private Limited, Chennai

11. TVS Housing Finance Private Limited, Chennai 12. Harita Two-wheeler Mall Private Limited, Chennai

Subsidiaries of TVSM, Singapore

13. The GO Corporation, Switzerland (GO AG),

14. Swiss E-Mobility Group (Holding) AG, Switzerland (SEMG) 15. The Norton Motorcycle Co Limited, UK

16. TVS Digital Pte Ltd, Singapore 17. EBCO Limited, UK

18. Celerity Motor GmbH, Germany (From 06.12.2022)

Subsidiaries of GO AG

19. EGO Movement, Stuttgart GmbH, Germany

Subsidiaries of SEMG

20. Swiss E-Mobility Group (Schweiz), Switzerland 21. Colag E-Mobility GmbH, Germany

22. AlexandRo EdouardO Passion V?lo S?rl (From 12.04.2022)

Subsidiary of Intellicar

23. Intellicar Singapore Pte Ltd [upto 24.05.2022]

Subsidiaries of Sundaram Holding USA Inc.

24. Green Hills Land Holding LLC, South Carolina, USA 25. Components Equipment Leasing LLC, South Carolina, USA 26. Sundaram-Clayton (USA) LLC, South Carolina, USA 27. Premier Land Holding LLC, South Carolina, USA


1. Emerald Haven Realty Limited, Chennai and its subsidiaries

2. TVS Training and Services Limited, Chennai

3 Sundram Non-Conventional Energy Systems Limited, Chennai



TVS Motor Company Limited (TVSM)

TVSM is engaged in the business of manufacture of two and three wheelers. During the year 2022-23, TVSMs total revenue including other income was $ 26,478.66 Cr and earned a profit after tax of

$ 1,491.03 Cr.

TVSM for the year 2022-23, declared interim dividend of $ 5 per share (500%) absorbing a sum of $ 237.54 Cr on 47,50,87,114 equity shares of $1 each. The same was paid on 9th February 2023.

Sundaram-Clayton (USA) Limited

Sundaram-Clayton (USA) Limited, a wholly owned subsidiary of the Company is engaged in the business of providing Professional Employer Organisation ("PEO") services to the employees of the Company.

Sundaram-Clayton DCD Limited, Chennai

Sundaram-Clayton DCD limited is a wholly owned subsidiary of the Company. This entity will carry on the business of Die-Casting upon demerger.

Sundaram Holding USA Inc., USA (SHUI) & its subsidiaries

Sundaram Holding USA Inc., USA (SHUI), a company established under the applicable provisions of Laws of The United States of America.

SHUIs wholly owned subsidiaries are:

1. Green Hills Land holding LLC, South Carolina, USA

2. Component Equipment Leasing LLC, South Carolina, USA

3. Sundaram-Clayton USA LLC, South Carolina, USA

4. Premier Land Holding LLC, South Carolina, USA

During the year 2022-23, the Company had acquired an additional stake of 50.05% in SHUI from Sundaram Auto Components Limited (SACL), a subsidiary of the Company.

Consequent to the above acquisition, the Companys holding in SHUI increased to 100% and thereby SHUIs subsidiaries in USA viz., Green Hills Land Holding LLC, Component Equipment Leasing LLC, Sundaram-Clayton USA LLC and Premier Land Holding LLC have also become wholly owned subsidiaries of the Company.

Sundaram-Clayton GmbH, Germany (SCL GmbH)

The Company had acquired 25,000 shares of EUR 1/- each in Sundaram-Clayton GmbH (SCL GmbH) effective 8th February 2023. Sundaram-Clayton GmbH (SCL GmbH), a wholly owned subsidiary of the Company is yet to commence it operations. SCL GmbH is incorporated with the objective of establishing an engineering design centre.

Sundaram Auto Components Limited (SACL)

The total income of SACL was $ 787 Cr in the current year as against

$ 608 Cr in the previous year 2021-22.

SACL earned a profit before tax of $ 24.08 Cr after incurring an exceptional cost of $ 1.87 Cr during the year 2022-23 as against profit of $ 4.30 Cr in the previous year after exceptional cost of $ 6.00 Cr. Exceptional cost includes separation cost. SACL is a wholly owned subsidiary of TVSM.

TVS Housing Limited (TVSH)

TVS Housing Limited is a wholly owned subsidiary of TVSM.

TVS Motor Services Limited (TVS MS)

TVS MS was incorporated as the investment SPV of the Company, for funding TVS Credit Services Limited (TVS CS).

TVS MS now holds 0.48% only in TVS CS and TVS MS continues to be a wholly owned subsidiary of TVSM.

TVS Credit Services Limited (TVS CS)

TVS CS is the retail finance arm of the Company for financing of two wheelers. TVS CS is a Non-Banking Finance Company catering to financing of retail focussed products such as two-wheelers, used cars, used and new tractors, used commercial vehicles, consumer durables, digital finance products and personal loans. TVS CS primarily caters to self-employed, new to credit borrowers in the semi-urban and rural areas in the country.

During the year 2022-23, TVS CSs overall disbursements registered at $ 21,652 Cr as compared to $12,533 Cr in the previous year registering growth of 73%.

During the year under review, the assets under management are around

$ 20,602 Cr as against $13,911 Cr during the previous year registering a growth of 48%.

Total income during the financial year 2022-23 increased to $ 4,160 Cr from $ 2,755 Cr during the financial year 2021-22, an increase of 51% over previous year.

The profit before tax after exceptional items for the year stood at $ 511 Cr as against $ 151 Cr during the previous year registering a growth of 238%.

The following companies are the subsidiaries of TVS CS.

1. Harita ARC Private Limited, Chennai

2. TVS Housing Finance Private Limited, Chennai

3. Harita Two-wheeler Mall Private Limited, Chennai

All the above subsidiaries are yet to commence their operations.

TVS Electric Mobility Ltd, Chennai (TVSEM)

The Company was incorporated on 13th December, 2021 to undertake Electric Mobility business. The entire shares of TVSEM have been subscribed by TVSM and hence, TVSEM is a wholly owned subsidiary of TVSM. The Company is yet to commence its operations.

TVS Motor Company (Europe) B.V

TVS Motor Company (Europe) B.V. was incorporated with a view to serve as special purpose vehicle for making and protecting the investments made in overseas operations of PT TVS.

TVS Motor (Singapore) Pte. Ltd

TVS Motor (Singapore) Pte Limited, a wholly owned subsidiary of the Company through its subsidiary TVS Digital Pte. Ltd. During the year, TVSM has invested a sum of SGD 91.53 Mn in the ordinary shares of SGD 1/- each of TVS Motor (Singapore) Pte Limited.

The Company serves as a special vehicle for investments made in overseas subsidiaries / associates.

PT. TVS Motor Company Indonesia (PT TVS)

PT TVS has posted Operating PBT of USD 5.6 Mn. for the full year.

PT TVS recorded sales of 19,096 nos. of three wheelers as against 11,043 nos. of sales during the previous year (growth of 73%) and 88,067 nos. of two wheelers as against 86,025 nos. in last year, thereby registering a growth of 2%.

The growth in sales numbers, coupled with effective management of fixed costs enabled PT TVS to achieve EBITDA of USD 8.3 Mn. (7.9% on turnover) as against USD 5.3 Mn. (6.4% on turnover) in last year.

Swiss E-Mobility Group (Holding) AG (SEMG)

During the previous year, TVSM acquired majority stake in Swiss E-Mobility Group and its subsidiaries viz., Swiss E-Mobility Group (Schweiz) and Colag E-Mobility GmbH through TVS Motor (Singapore) Pte Ltd.

The acquisition reaffirms TVSMs commitment to expansion in Europe, largest eBike market outside of China, through a portfolio of premium and technology leading brands including EGO Movement.

SEMG is a market-leading provider of e-mobility solutions within the DACH region, operating the largest pure-play ebike retail chain m-way in Switzerland. SEMG currently has a physical network of 33 stores at strategic locations across Switzerland and two online e-commerce platforms for distribution of its products.

SEMG has strong omnichannel distribution and aspirational brands, including Cilo, Simpel, Allegro and Zenith-Bikes.

SEMG is No. 1 in Switzerland with a market share of 20%. During last calendar year 2022, SEMG Group reported a revenue of USD 69.5 Mn and a loss of USD 11.2 Mn. With further growth planned on physical stores and expansion further into the DACH region, the expected revenue for the current calendar year 2023 is around USD 104 Mn. SEMG acquisition gives an opportunity to grow in personal mobility business including e-kick scooters and e-cargo bikes which are emerging trends.

E-bikes are emerging as the leading personal mobility solution in Europe due to the increased ease of usage, regulatory support and overall perception as a sustainable form of transport. With a current penetration of approximately 15% of the total bicycle population in Europe and growing at a CAGR of ~18%, the market for the e-bicycle holds significant growth potential. The global Industry for E-bikes is expected to touch USD 25 bn in 5 years.

This acquisition of eBike business having a good market share and opportunity to drive further value will augur well for the TVSM & the Company in the long run.

The GO Corporation, Switzerland (the GO AG)

In September 2021, TVSM acquired majority stake in the GO AG, Switzerland and its subsidiary EGO Movement through TVS Motor (Singapore) Pte Ltd.

Over the past decade, the personal mobility landscape has evolved significantly with the global sustainability agenda, increasing urbanisation and advancement in battery technology.

EGO Movements product portfolio focuses on delivering sustainable products with the latest technology and stylish designs. A powerful battery is blended harmoniously into the frame, whose ergonomic design allows for a comfortable upright sitting position. In addition, EGO Movements Connectivity platform is enhancing security and convenience for the vehicles user with smart features such as keyless-go, GPS location with theft alarm and access-sharing. The unique and innovative design philosophy has earned the company multiple awards, including the prestigious Red Dot Award and in 2022 the German Brand Award.

This acquisition is in line with the Companys commitment towards electrification and the broader sustainability agenda for building an aspirational product portfolio while nurturing sustainable and scalable brands. EGO Movement is a Swiss technology company providing innovative mobility solutions through a portfolio of e-bikes, e-cargo bikes and matching accessories.

EGO Movement has a strong presence in Europe with customer-centric products, a unique omnichannel network and a visionary team at its helm.

The Norton Motorcycle Co Limited, UK

During the financial year 2022-23, The Norton Motorcycle Co. Limited (UK) (Norton) has started handing over the bikes to the Customers from the new state of art facility established in Solihull, United Kingdom.

Norton has launched new Commando 961 Sports bike with completely redesigned components. A clear distribution strategy has been established with plans to have a mix of sales direct to customer and through dealers. It has already set up few dealers in United Kingdom and has formed or firmed up its product plan with a series of new products to be launched in coming years catering to various markets and segments in the premium motorcycle market.

Norton will continue to focus on improving the quality standards and supply chain as it steps ups the production volumes and for the new products in the coming years as part of its journey of relaunching this iconic brand to its rightful place at the global level.

TVS Digital Pte Ltd, Singapore

TVS Digital Pte Limited, Singapore is a wholly owned subsidiary of TVS Motor (Singapore) Pte Limited. The Digital start-up offers a range of solutions across their Auto-tech and Fintech platforms and have secured clients in Bangladesh, Bolivia, India, Indonesia, Nepal, Philippines and Singapore.

The product offerings centre around Credit Decisioning and Collections in Fintech and a suite of Sales acceleration and Consumer Experience enhancements apps in the Auto-tech platform that is also finding applicability in Real Estate and B2B businesses.

Revenue streams have commenced and the team is now focused on exponential growth through scale and adoption to help deliver focused unit economics objectives.


Emerald Haven Realty Limited (EHRL)

During the year, EHRL registered a sales booking value (BV) of

$ 930 Cr the highest ever annual sales BV in the history of EHRL, with a growth of 189%, backed by strong sales across new launches and sustenance projects EHRL a worked on various value engineering measures to control operating and fixed costs, which helped in the operating performance of the Company.

EHRL completed 4 land acquisitions across Chennai and Bangalore with a sales BV potential of $ 1,250 Crs for the year under review. The Company has completed development of 2.4 Million Sft till date and the balance area under development as on date is 6.25 Million Sft.

Subsidiaries of EHRL

1. Emerald Haven Development Limited;

2. Emerald Haven Projects Private Limited;

3. Emerald Haven Life Spaces (Radial Road) Limited;

4. Emerald Haven Realty Developers (Paraniputhur) Private Limited;

5. Emerald Haven Property Development Limited;

6. Emerald Haven Town and Country Private Limited;

7. Happiness Harmony Property Developers Private Limited; and

8. Emerald Haven Towers Limited

TVS Training and Services Limited (TVS TSL)

TVS training services to various industries and is participating in the National Skill Development Projects. During the year, TVS TSL earned an income of $ 43.58 Cr and profit after tax for the year ended 31st March 2023 was $ 0.71 Cr. TVSTSL is engaged in the business of establishing and providing vocational

Sundram Non-Conventional Energy Systems Limited (SNCES)

SNCES is engaged in the business of generation of power. During the year 2022-23, the SNCES earned a total revenue of $ 3.04 Cr and Profit after tax was $ 3.59 Cr.


The consolidated financial statements of the Company are prepared in accordance with the provisions of Section 129 of the Act, 2013 read with the Companies (Accounts) Rules, 2014 and Regulation 33 of Listing Regulations along with a separate statement containing the salient features of the financial performance of subsidiaries / associates, in the prescribed form. The audited consolidated financial statements together with Auditors Report forms part of the Annual Report.

The financial statements of the subsidiary companies will be made available to the Shareholders, on receipt of a request from any

Shareholder and it has also been placed on the website of the Company. This will also be available for inspection by the Shareholders at the Registered Office during the business hours as mentioned in the Notice of AGM.

The consolidated Profit Before Tax of the Company and its subsidiaries & associates amounted to $ 2,013.32 Cr for the financial year 2022-23 as compared to $ 1,184.20 Cr in the previous year.


Special Recognition to Mr Venu Srinivasan, Chairman Emeritus & Managing Director

Mr Venu Srinivasan was honoured with the "Outstanding Institution Builder" of the year by AIMA (All India Management Association) at its 13th Managing India Awards in recognition of excellence in Business Leadership and Management and his significant contributions in building and shaping an institution, driving its growth, and creating a lasting legacy.

Directors appointment / re-appointment / cessation/ demise

During the year under review :

Mr R Gopalan, was appointed as Chairman effective 1st April 2022 and Mr Venu Srinivasan was designated as Chairman Emeritus & Managing Director (CE & MD) effective 1st April 2022.

Dr. Lakshmi Venu was elevated as Managing Director of the Company effective 6th May 2022.

Mr R Gopalan ceased to be an Independent Director on 23rd July 2022 consequent to the expiry of second term of Independent Directorship. He was subsequently appointed as Non-Executive Non-Independent Director on the Board effective 29th July 2022, on the recommendation of the Nomination and Remuneration Committee with the approval of the shareholders through postal ballot on 7th September 2022.

Mr Anuj Shah and Mr C R Dua, Directors were appointed as Non-Executive Independent Director(s) (NE-ID) for a term of five consecutive years with effect from 29th July 2022 and 13th March 2023, respectively, on the recommendation of the Nomination and Remuneration Committee (NRC). The shareholders have approved their appointment by way of special resolution through postal ballot on 7th September 2022 and 27th April 2023, respectively.

NRC had carried out evaluation of the appointed Directors before the appointment on various parameters viz., integrity, qualification, expertise, experience and it has satisfied itself with the positive attributes of the Directors in accordance with the Nomination and Remuneration (NR) Policy read with the provisions of Section 178 of the Act, 2013 and the Listing Regulations.

Directors cessation / demise

During the Year under review, Mr S Santhanakrishnan, Mr Kamlesh Gandhi, Mr V Subramanian and Mr R Vijayaraghavan ceased as Independent Directors effective 20th August 2022 consequent to the expiry of second term as Independent Directors and thereby they also ceased as members of Committees wherever they held membership.

The Board recorded its appreciation on the contributions made by Mr S Santhanakrishnan, Mr V Subramanian, Mr R Vijayaraghavan and Mr Kamlesh Gandhi and also their uniqueness in handling issues to the granularity which made an indelible impression on all directors of the Company.

The Board noted and appreciated the strategic initiatives, inquisitive nature in dealing with operational issues by the Independent Directors, insights and guidance provided to the management especially in legal, Banking and financial management made the Board as an accomplished one.

With profound grief, the Board condoles the demise of Vice Admiral P J Jacob, Independent Director of the Company, on 22nd January 2023. Vice Admiral P J Jacob had been associated with the group for more than sixteen years. The Board records the excellent contribution made by Vice Admiral P J Jacob during his tenure as an Independent Director of the Company.

In terms of the provisions of sub-section (6) read with explanation to Section 152 of the Act, 2013 two-thirds of the total number of Directors i.e., excluding IDs, are liable to retire by rotation and out of which, one-third is liable to retire by rotation at every annual general meeting. Mr Venu Srinivasan and Mr Rajesh Narasimhan are liable to retire by rotation, at the ensuing AGM, and being eligible, offer themselves for re-appointment.

The Directors have recommended their re-appointment for the approval of shareholders. Brief resume of the Directors are furnished in the Notice convening the AGM of the Company.

Independent Directors (IDs)

All IDs hold office for a fixed term of five years and are not liable to retire by rotation.

As at 31st March 2023, M/s C R Dua, Anuj Shah and Sasikala Varadachari are the Independent Directors of the Company.

Ms Sasikala Varadachari was appointed by the Board effective 24th October 2018 as NE-ID for a term of five consecutive years effective that date and the same was approved by the shareholders at the 57th AGM held on 23rd July 2019.

The terms of appointment of IDs include the remuneration payable to them by way of fees and profit related commission, if any.

The terms of IDs cover, inter-alia, duties, rights of access to information, disclosure of their interest / concern, dealing in Companys shares, remuneration and expenses, insurance and indemnity. The IDs are provided with copies of the Companys policies and charters of various Committees of the Board.

In accordance with Section 149(7) of the Act, 2013, all IDs have declared that they met the criteria of independence as provided under Section 149(6) of the Act, 2013 and Regulation 25 of the Listing Regulations and the Board confirms that they are independent of the management.

The detailed terms of appointment of IDs is disclosed on the Companys website in the link as provided in page no. 93 of this Annual Report.

All the IDs have registered with the databank of Independent Directors developed by the Indian Institute of Corporate Affairs in accordance with the provisions of Section 150 of the Companies Act, 2013 and obtained ID registration certificate and renewed the same for five years / life time, as the case may be.

Separate meeting of Independent Directors

During the year under review, a separate meeting of IDs was held on 27th March 2023.

Based on the set of questionnaires, complete feedback on Non-Independent Directors and details of various activities undertaken by the Company were provided to IDs to facilitate their review / evaluation.

(a) Non-Independent Directors (Non-IDs)

IDs used various criteria prescribed by the Nomination and Remuneration Committee (NRC) for evaluation of Non-IDs and Executive Directors viz., M/s. Venu Srinivasan, Dr. Lakshmi Venu and Mr K Gopala Desikan and Non-IDs viz., M/s. Sudarshan Venu, Rajesh Narasimhan and R Gopalan and also of Chairman of the Board and the Board as a whole, for the year 2022-23.

IDs evaluated the performance of all Non-IDs individually, through a set of questionnaires. They reviewed the developing strategic plans aligned with the vision and mission of the Company, displaying leadership qualities for seizing the opportunities and priorities, developing and executing business plans aware of the risks involved, establishing an effective organizational structure, and demonstrating high ethical standards and integrity and commitment to the organization besides participation at the Board / Committee meetings, effective deployment of knowledge and expertise and constructive comments/ guidance provided to management by the Non-IDs.

They have also noted the milestones achieved by the Company during the year under review.

IDs were satisfied fully with the performance of all Non-IDs.

(b) Chairman

The IDs reviewed the performance of Chairman of the Board.

The IDs also placed on record their appreciation of Chairmans high level of integrity & objectivity and judicious approach, and brings his vast experience, helps to steer Board discussions and decisions for the benefit of the Company and Shareholders.

(c) Board

IDs also evaluated Boards composition, size, mix of skills and experience, its meeting sequence, effectiveness of discussion, decision making, follow up action, so as to improve governance and enhance personal effectiveness of Directors.

The evaluation process focused on Board Dynamics and the Board upon evaluation concluded that it is well balanced in terms of diversity of experience with expert in each domain viz., Engineering, Leadership/ Strategy, Finance, Information Technology, Marketing, Legal and

Regulatory and Governance. The Company has a Board with wide range of expertise in all aspects of business.

IDs recorded that they were always kept involved through open and free discussions and provided additional inputs in emerging areas being forayed into by the Company and high levels of Corporate Governance in all management discussion and decisions were maintained.

The IDs unanimously evaluated the prerequisites of the Board viz., formulation of strategy, acquisition & allocation of overall resources, setting up policies, directors selection processes and cohesiveness on key issues and satisfied themselves that they were adequate.

They were satisfied with the Companys performance in all fronts and finally concluded that the Board operates with best practices.

(d) Quality, Quantity and Timeliness of flow of Information between the Company, Management and the Board

All IDs have expressed their overall satisfaction with the support received from the management and the excellent work done by the management during the year under review and also the relationship between the top management and Board is smooth and seamless.

The Company is in compliance with the statutory requirements under both the Companies Act and Listing Regulations and all the information provided to the Directors are very wholesome.

The information provided for the meetings were clear, concise and comprehensive to facilitate detailed discussions and periodic external presentations on specific areas well supplemented the management inputs. The emerging e-technology was duly incorporated in the overall review of the Board.


Mr Venu Srinivasan, Chairman Emeritus & Managing Director, Dr. Lakshmi Venu, Managing Director, Mr K Gopala Desikan, Director and Group Chief Financial Officer, Mr Vivek S Joshi, Chief Executive Officer, and Mr R Raja Prakash, Company Secretary are the Key Managerial Personnel of the Company in terms of Section 2(51) read with Section 203 of the Act, 2013 as on date of this Report.

Nomination and Remuneration Policy

The Nomination and Remuneration Committee of Directors (NRC) reviews the composition of the Board to ensure an appropriate mix of abilities, experience and diversity to serve the interests of all stakeholders of the Company.

Nomination and Remuneration Policy was approved by the Board at its meeting held on 24th September 2014 and amended from time-to-time to maintain consistency and statutory amendments to be reflected in the policies to make it upto date and more comprehensive. The objective of such policy shall be to attract, retain and motivate executive management and devise remuneration structure to link to Companys strategic long term goals, appropriateness, relevance and risk appetite.

NRC will identify, ascertain the integrity, qualification, appropriate expertise and experience, having regard to the skills that the candidate will bring to the Board / Company, whenever the need arises for appointment of Directors / KMP.

Criteria for performance evaluation, disclosures on the remuneration of Directors, criteria of making payments to Non-Executive Directors have been disclosed as part of Corporate Governance Report attached herewith.

Remuneration payable to Non-Executive Independent Directors

The shareholders at the 59th AGM held on 30th July 2021 renewed the authorization for the payment of remuneration by way of commission not exceeding 1% of the net profits, in aggregate, payable to Non-Executive and Independent Directors of the Company (NE-IDs) for every year, from 1st April 2021.

NE-IDs devote considerable time in deliberating the operational and other issues of the Company and provide valuable advice in regard to the management of the Company from time to time, and the Company also derives substantial benefit through their expertise and advice.

Evaluation of Independent Directors and Committees of Directors

In terms of Section 134 of the Act, 2013 and the Corporate Governance requirements as prescribed under Listing Regulations, the Board reviewed and evaluated Independent Directors and various Committees viz., Audit Committee, Risk Management Committee, Nomination and Remuneration Committee, Corporate Social Responsibility Committee and Stakeholders? Relationship Committee, based on the evaluation criteria laid down by the NRC.

Board has carried out the evaluation of all Directors (excluding the Director being evaluated) and its Committees through a set a questionnaires.

Independent Directors

The performance of all IDs were assessed against a range of criteria such as contribution to the development of business strategy and performance of the Company, understanding the major risks affecting the Company, clear direction to the management and contribution to the Board cohesion. The performance evaluation has been done by the entire Board of Directors, except the Director concerned being evaluated.

The IDs were always kept informed of the constitution of robust framework for the Company and group companies against cyber threats and mitigation plans against cyber-attacks for business continuity.

They also kept abreast of risk mitigation plans on Business risks viz., depreciation of currency, global economic scenarios, increasing material cost and global inflationary pressure. They also evaluated and satisfied with the risk mitigation on CoVID preparedness, to minimize the impact on business operations and employees health, from its previous learnings.

The Board noted that all IDs have understood the opportunities and risks to the Companys strategy and are supportive of the direction articulated by the management team towards consistent improvement.

On the basis of the report of performance evaluation of directors, the Board noted and recorded that all the directors should extend and continue their term of appointment as Directors / Independent Director, as the case may be.


Board delegates specific mandates to its Committees, to optimize Directors skills and talents besides complying with key regulatory aspects.

• Audit Committee for overseeing financial Reporting;

• Risk Management Committee for overseeing the risk management framework;

• Nomination and Remuneration Committee for selecting and compensating Directors / Employees;

• Stakeholders Relationship Committee for redressing investors grievances; and

• Corporate Social Responsibility Committee for overseeing CSR initiatives and inclusive growth.

The performance of each Committee was evaluated by the Board after seeking inputs from its members on the basis of specific terms of reference, its charter, time spent by the Committees in considering key issues, quality of information received, major recommendations / action plans and work of each Committee.

The Board is satisfied with the overall effectiveness and decision making of all Committees. The Board reviewed each Committees terms of reference to ensure that the Companys existing practices remain appropriate.

Directors continued to devote such time as is necessary for the proper performance and effectively discharge their duties, all of them were able to devote appropriate time to fulfill their duties

Board and its Committees had an appropriate combination of skills, experience and knowledge.

The current Committees structure was considered effective and all the Committees of the Board were all considered to be working effectively.

Recommendations from each Committee were considered and approved by the Board prior to its implementation, wherever necessary and there were no items where the Board had not accepted any recommendation of any Committee of the Board in the relevant financial year.

Details of Committees, its charter, functions are provided in the Corporate Governance Report attached to this Report.

Number of Board meetings held:

During the FY 2022-23, the Board met eight times and details of the meetings are provided as part of Corporate Governance Report prepared in terms of the Listing Regulations.


Statutory Auditors

The Company at its Sixtieth AGM held on 28th June 2022 re-appointed M/s Raghavan, Chaudhuri & Narayanan, Chartered Accountants, Bengaluru, having Firm Registration No. 007761S allotted by The Institute of Chartered Accountants of India, as Statutory Auditors of the Company to hold office, for the second term of five consecutive years, from the conclusion of the said AGM till the conclusion of the 65th AGM, at such remuneration in addition to applicable taxes, and reimbursement of travelling and other out of pocket expenses as may be mutually agreed between the Board of Directors of the Company on the recommendations of the Audit Committee and the Auditors.

The Company has obtained necessary certificate under Section 141 of the Act, 2013 conveying their eligibility for being statutory auditors of the Company for the year 2023-24.

The Auditors Report for the financial year 2022-23 does not contain any qualification, reservation or adverse remark and the same is attached with the annual financial statements.

Secretarial Auditor

As required under Section 204 of the Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company is required to appoint a Secretarial Auditor for auditing secretarial and related records of the Company.

The Secretarial Audit Report for the financial year 2022-23, given by Mrs B Chandra, Practising Company Secretary, Chennai for auditing the secretarial and related records is attached to this report. The Secretarial Audit Report does not contain any qualification, observation or other remarks.

The Board at its meeting held on 5th May 2023 has re-appointed Mrs B Chandra, Practising Company Secretary, Chennai, (CP No. 7859) as Secretarial Auditor for the financial year 2023-24.

Cost Auditor

As per Section 148 of the Act, 2013 read with the Companies (Cost Records and Audit) Rules 2014, as amended, the cost audit records maintained by the Company in respect of parts manufactured by the Company covered under other machinery specified under Customs Tariff Act heading in Table B to Rule 3 of the above rules, are required to be audited by a Cost Auditor.

Mr A N Raman, Practicing Cost Accountant, having Registration No. 5359 allotted by The Institute of Cost Accountants of India, was re-appointed as Cost Auditor of the Company at the Board meeting held on 6th May 2022 to carry out the audit as per the aforesaid provisions of the Companies Act, 2013 for the financial year 2022-23. His remuneration was also ratified by the members at the 60th AGM held on 28th June 2022.

In terms of the Companies (Cost Records and Audit) Amendment Rules, 2014, the Board has appointed M/s C S Adawadkar & Co., Practising Cost Accountants, having Firm Registration No. 100401 allotted by

The Institute of Cost Accountants of India, as Cost Auditor of the Company, on the recommendation of the Audit Committee, in the place of Mr A N Raman, Practising Cost Accountant, in terms of Section 148 of the Act, 2013, as the Cost Auditor for conducting Cost Audit for the financial year 2023-24.

The Company has received consent from M/s C S Adawadkar & Co., Practicing Cost Accountants, to serve as Cost auditors of the Company for the financial year 2023-24.

The Company has also received necessary certificate under Section 141 of the Act, 2013 from them conveying their eligibility to act as a Cost Auditor.

A sum of $ 5 lakhs has been fixed by the Board as remuneration in addition to applicable taxes, and reimbursement of travelling and other out-of-pocket expenses payable to him, for the financial year 2023-24, which is required to be approved and ratified by the Members, at the ensuing AGM as per Section 148(3) of the Act, 2013.

Directors place on record their deep appreciation of the valuable service rendered by Mr A N Raman, Cost Accountant, Chennai.

The Company has filed the Cost Audit Report of 2021-22 on 26th August 2022 in XBRL format.


The Company has been practicing the principles of good corporate governance over the years and lays strong emphasis on transparency, accountability and integrity.

A separate section on Corporate Governance and a certificate from the Statutory Auditors of the Company regarding compliance of conditions of Corporate Governance as stipulated under the Listing Regulations form part of this Annual Report.

The Chairman Emeritus & Managing Director and the Director and Group Chief Financial Officer of the Company have certified to the Board on financial statements and other matters in accordance with Regulation 17(8) of the Listing Regulations, 2015 pertaining to CEO / CFO certification for the financial year ended 31st March 2023.



In terms of Regulation 34 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("Listing Regulations") read with relevant SEBI Circulars, new reporting requirements on ESG parameters were prescribed under "Business Responsibility and Sustainability Report" (BRSR). The BRSR seeks disclosure on the performance of the Company against nine principles of the "National Guidelines on Responsible Business Conduct (NGRBCs).

As per the SEBI Circulars, effective from the financial year 2022-23, filing of BRSR is mandatory for the top 1000 listed companies by market capitalisation. Accordingly, for the financial year ended 31st March 2023,

Company has published BRSR, in the prescribed format is given as Annexure IV to this Report and is available on the Companys website in the link as provided in page no. 93 of this Annual Report.


The Company has adopted a Policy on Vigil Mechanism in accordance with the provisions of the Act, 2013 and Regulation 22 of the Listing Regulations, which provides a formal mechanism for all Directors, Employees and other Stakeholders of the Company to report to the management, their genuine concerns or grievances about unethical behaviour, actual or suspected fraud and any violation of the Companys Code of Business Conduct and Ethics.

The Code also provides a direct access to the Chairman of the Audit Committee to make protective disclosures to the management about grievances or violation of the Companys Code.

The Policy is disclosed on the Companys website in the link as provided in page no. 93 of this Annual Report.


The Company has not accepted any deposit from the public within the meaning of Section 76 of the Act, 2013, for the year ended 31st March 2023.



Information on conservation of energy, technology absorption, foreign exchange, etc.,

Relevant information is given in Annexure-I to this Report, in terms of the requirements of Section 134(3)(m) of the Act, 2013 read with the Companies (Accounts) Rules, 2014.

Material changes and commitments, if any, affecting the financial position of the Company, having occurred since the end of the Year and till the date of the Report:

There have been no material changes and commitments affecting the financial position of the Company, which have occurred between the end of the financial year of the Company to which the financial statements relate and the date of this Report.

Significant and material orders passed by the Regulators or Courts or Tribunals impacting the going concern status of the Company

There are no significant and material orders passed by the Regulators or Courts or Tribunals, which would impact the going concern status of the Company and its future operations.

Annual Return

Copy of the Annual Return (Annexure II) in prescribed form is available on the Companys website in the link as provided in page no. 93 of this Annual Report, in terms of the requirements of Section 134(3)(a) of the Act, 2013 read with the Companies (Accounts) Rules, 2014.

Employees remuneration

Details of employees receiving the remuneration in excess of the limits prescribed under Section 197 of the Act, 2013 read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are annexed as a statement and given in Annexure-III. In terms of first proviso to Section 136(1) of the Act, 2013 the Annual Report, excluding the aforesaid annexure is being sent to the Shareholders of the Company. The annexure is available for inspection at the Registered Office of the Company during business hours as mentioned in the Notice of AGM and any Shareholder interested in obtaining a copy of the said annexure may write to the Company Secretary at the Registered Office of the Company.

Comparative analysis of remuneration paid

A comparative analysis of remuneration paid to Directors and employees with the Companys performance is given as Annexure-V to this Report.

Details of material related party transactions

There are no material related party transactions under Section 188 of the Act, 2013 read with Companies (Meetings of Board and its Powers) Rules, 2014.

Details of loans / guarantees / investments made

During the year under review, the Company had not granted any loans or guarantees covered under Section 186 of the Act, 2013.

Please refer note no. 4 to Notes on accounts for the financial year 2022-23, for details of investments made by the Company.

Reporting of fraud

The Auditors of the Company have not reported any fraud as specified under Section 143(12) of the Act, 2013.

Secretarial Standards

The Company has complied with the applicable secretarial standards as amended from time to time.

General Disclosures

During the year, there were no transaction requiring

disclosure or reporting in respect of matters relating to:

(a) issue of equity shares with differential rights as to dividend, voting or otherwise;

(b) issue of shares (including sweat equity shares) to employees of the Company under any scheme;

(c) pendency of any proceeding under the Insolvency and Bankruptcy Code, 2016 and

(d) instance of one-time settlement with any bank or financial institution.

Disclosure in terms of Sexual Harassment of Women at workplace (Prevention, Prohibition and Redressal) Act, 2013

As per the requirement of The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 (POSH), the Company has an Internal Complaints Committee as required under The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

During the year under review, there were no cases filed pursuant to the provisions of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

During the year 2022-23, initiatives were undertaken to demonstrate Companys zero tolerance policy against discrimination and sexual harassment, which included creation of comprehensive and easy to understand training and communication material. In addition, online workshops were also run for the employees to enhance awareness and knowledge.


The directors gratefully acknowledge the continued support and cooperation received from the promoters of the Company.

The Directors thank the vehicle manufacturers, vendors and bankers for their continued support and assistance.

The Directors wish to place on record their appreciation of the continued excellent work done by all the employees of the Company during the year.

The Directors specially thank the shareholders for their continued faith in the Company.

For and on behalf of the Board of Directors



5th May 2023 DIN: 01624555