Auto Axles

39th Annual Report 2019-20
Contents
Financial Performance 01
Chairman’s Review 02
Board’s Report 04
Management Discussion and Analysis 37
Report on Corporate Governance 48
Business Responsibility Report 65
Independent Auditor’s Report 76
Balance Sheet 84
Statement of Profit & Loss 85
Statement of Changes in Equity 86
Cash Flow Statement 87
Notes 89
Notice 130
Corporate Information
Board of Directors Registrar & Share Transfer Agents (RTA)
Dr. Babasaheb N Kalyani, Chairman Integrated Registry Management Services Private Limited*
Mr. Chrishan Anton Sebastian Villavarayan, Director #30, Ramana Residency, 4th cross
Mr. Bhalachandra B Hattarki, Independent Director Sampige Road, Malleshwaram
Mr. B C Prabhakar, Independent Director Bangalore – 560 003
Mr. Rakesh Kalra, Independent Director Ph: 080-23460815-818;
Dr. Shalini Sarin, Independent Director E-mail: irg@integratedindia.in
Mr. Srinivasan Kumaradevan, Sr. Vice President & * RTA: Earlier name: Integrated Enterprises (India) Limited
Whole-time Director
Registered Office

Hootagalli Industrial Area, Off Hunsur Road,
Key Managerial Personnel
Mysuru, Karnataka - 570 018
Mr. Srinivasan Kumaradevan, Sr. Vice President &
Ph: 0821-7197500
Whole-time Director
Website: www.autoaxle.com
Mr. Ranganathan S, Chief Financial Officer
Email: sec@autoaxle.com
Mr. Debadas Panda, Company Secretary

Works
Statutory Auditors 1. Mysuru
S R Batliboi & Associates LLP, Bengaluru Hootagalli Industrial Area,
Off Hunsur Road, Mysore, Karnataka – 570 018
Internal Auditors 2. Rudrapur
PriceWaterhouse Coopers Services LLP, Bengaluru Plot No. 3, ITBT Park, SIIDCUL - IEE, Pant Nagar, (NH-4),
Dist. Udham Singh Nagar, Uttarakhand - 263 150
Bankers 3. Jamshedpur
Old Khakripara, Village & Post – Chhota Govindpur,
HDFC Bank Limited
Jamshedpur, Dist. E. Singhbhum, Jharkhand – 831 015
Kotak Mahindra Bank
4. Hosur Plant
State Bank of India Plot No 39, Sipcot Industrial Area, LAS Phase-I,
Axis Bank Limited Mookandapalli, Hosur, Tamilnadu, 635 126
Financial Performance
Total Revenue (` in mn) EBITDA (` in mn)
19,420.02 2,320.46
15,580.63
1,715.78
13,039.92
10,875.44 1,156.10
9,596.81
963.20 1,010.07
FY16 FY17 FY18 FY19 FY20 FY16 FY17 FY18 FY19 FY20
PBT (` in mn) PAT (` in mn)
1,853.11 1,215.50
1,278.17 839.32
750.13 494.18
515.24 599.54 347.74 411.34
NETWORTH (` in mn) EPS (`)
5,384.40 5,319.37 80.43

4,443.35
3,765.90 55.54
3,271.98
32.70
27.22
23.01
Automotive Axles Limited Annual Report 2019-20
Chairman’s Review
Dear Stakeholders,
These are challenging times, and I hope you and all other
India’s auto industry which
members of your family are safe and in good health.
consists of automobiles and
auto components witnessed
We are facing a health emergency that is disrupting the lives
one of its most challenging
and livelihoods of millions of people across the world. It is
years during FY 2019-20 with
reassuring to note that India’s response to the COVID-19
declining sales figures vis-à-vis
outbreak has been prompt and the Government of India
the previous few years owing
has already announced a `1.7 lakh crores relief package to
to weak domestic demand and
help support the lives and livelihoods of millions of people.
falling exports.
The Reserve Bank of India’s (RBI) accommodative monetary
policy has also helped ease the credit scenario to a very
large extent.
I salute the spirit and solidarity of all citizens of our country, are predicting recovery in CY 2021 driven by demand
especially doctors, nurses, healthcare workers and other improvement and resumption of activities globally. Whether
officials, who are endangering their lives to help save the recovery is ‘V’ shaped or ‘U’ shaped depends on how
others. I am happy to share that your Company has pledged quickly normal economic activity can be resumed post
assistance through direct contribution of `1.50 crores to the lockdowns without further loss of lives and livelihoods.
Prime Minister’s Citizen Assistance and Relief in Emergency India is going through a graded exit from the lockdown,
Situations Fund (PMCARES Fund) to help combat the depending on the evolving scenario in the states. According
COVID-19 pandemic. to the Ministry of Statistics and Programme Implementation,
Government of India, India’s economy grew ~5% in
Our Group is committed to assist the central and state FY 2019-20, despite a weak demand scenario across
governments and local authorities in all possible ways to almost all sectors of the economy.
deal with the pandemic. As part of our corporate social
responsibility initiatives, we are addressing the food India’s auto industry which consists of automobiles and auto
requirements of the local community and will continue to components witnessed one of its most challenging years
scale up our efforts in the coming days. during FY 2019-20, with declining sales figures vis-à-vis the
previous few years owing to weak domestic demand and
I would like to assure the shareholders that your Company falling exports. We are hoping that there will be marginal
has taken every step to ensure safety of the employees and revival after the COVID crisis blows over, because the credit
the community. We have established world-class safety scenario in India is very encouraging right now, which can
measures and preventive protocols at all locations. We help drive demand.
are taking employees health and safety as the number one
priority during the lockdown, unlock and ramp up period. Our performance
We recorded revenues of `952 crores and EBITDA of
Operating landscape `101 crores. Our decline in numbers is a direct result of
The global economy continues to grapple with headwinds low production among our key OEM clients. This decline in
arising from the COVID-19 pandemic with many countries production is due to an extremely weak demand scenario
expected to witness sharp decline in GDP. While it is in the Commercial Vehicle (CV) industry, as OEMs remain
too early to talk about recovery, IMF and other agencies cautious in ramping up BS-VI vehicles production.
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Company Overview 01-03 Statutory Reports 04-75 Financial Section 76-129 Notice 130-137
We expected a decent performance for FY 2020-21, but

the pandemic is set to impact our business brutally during
the first half of the year and to a limited extent thereafter.
We have also successfully
However, we look forward to growth in the coming years.
overcome the technical
challenges in the way of
Efficiency optimisation manufacturing BS-VI-complaint
During the year, we inaugurated our new state-of-the-art
products and now are capable
assembly line, which uses cutting-edge technology
of catering to this market
and contemporary equipment like robotic painting line
requirement.
and IoT-enabled processes. The facility also enables
a digitally driven, paperless shop-floor in line with the
Industry 4.0 trend of automation and data exchange in
the manufacturing sector. It has already delivered a batch
of products and facilitated improved cost structure and
productivity. We remain confident that our recent capital Road ahead
expansion will help us to steer growth and improve margins Going forward, we will prioritise:
once volumes return in the industry. Grow revenue and profitability
Enhanced engagement with existing and new customers
We have also successfully overcome the technical challenges Continuous improvement in safety, manufacturing
in the way of manufacturing BS-VI-complaint products and processes and quality systems
now are capable of catering to this market requirement. Operational excellence and focus on Industry 4.0
Focus on new product development
Over the years, we have embraced IT systems that strengthen Employee engagement and talent management
our core. We have migrated to HANA version of SAP, which
facilitates data-driven decision-making at AAL, increasing We will continue to manage and mitigate the evolving
our efficiency and productivity. IT systems and processes risk scenario in the business and deliver on sustainability
play a big role in the organisation, as we continue to focus commitments to create value for all stakeholders.
on automation in Human Resource Management System,
vendor portal, e-way bills to align the enterprise better with On behalf of the Board and the leadership team, I thank you
the emerging trends of Industry 4.0. for your continued trust and support in all our endeavours.
Despite growing focus on technology, our people continue

to be pivotal to our success and sustainability. We emphasise
a congenial work environment that inspires talent to deliver Warm regards,
their best every day. We invest in developing the skills of
our teams and engaging with them continuously to build a Dr. B N Kalyani
collaborative work environment. Chairman
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Board’s Report
To the Members,
Your Directors have the pleasure in presenting the 39th Annual Report on the business and operations of your Company
together with the Audited Statements of Accounts for the financial period ended March 31, 2020:
Financial Highlights:
(` in million)
Particulars 2019-2020 2018-2019
Total Revenue 9,596.81 19,420.02
Profit before depreciation & tax 971.76 2,314.97
Less : Depreciation, amortization & Loss on assets discarded 372.22 461.86
Tax expenses 188.20 637.61
Profit for the year after tax 411.34 1,215.50
Other comprehensive income for the year, net of tax (5.04) (28.51)
Total comprehensive income for the year 406.30 1,186.99
Balance of Profit from Previous Year 4,658.87 3,717.82
Less: Dividend 385.36 204.00
Dividend Distribution tax on Dividend 79.21 41.94
Effect of adoption of Ind AS 116 (net of taxes) 6.76 -
Profit available for appropriation 4,593.84 4,658.87
Dividend Transfer of unpaid or unclaimed amount

The Board by passing resolution by circulation on 2nd of to Investor Education and Protection
March, 2020 declared an interim dividend for the year Fund (IEPF)
2019-20 of INR 6/- per Equity Share (i.e. 60%) of the Pursuant to provisions of the Companies Act, 2013, the
face value of INR 10/- aggregating to INR 90.67 million, declared dividends, which remained unpaid or unclaimed
excluding Dividend Distribution Tax. for a period of seven years, shall be transferred by the
Company to the Investor Education and Protection Fund
The Board, at its meeting held on 26th May, 2020, is pleased (IEPF) established by the Central Government.
to recommend a dividend of `0.80/- per Equity Share of the
face value of `10/- each for the financial year ended 31st Pursuant to Section 124(6) of the Companies Act, 2013
March, 2020 subject to the approval of shareholders at the read with Investor Education and Protection Fund Authority
ensuing Annual General Meeting to be held on Wednesday, (Accounting , Audit, Transfer and Refund) Rules, 2016 as
19th August, 2020. amended, all shares in respect of which dividend has not
been paid or claimed for seven consecutive years or more,
The total amount of Dividend aggregates to `1.21 million shall be transferred by the Company to the IEPF.
excluding Dividend Distribution Tax.
Accordingly, the Company has sent notice to the respective
The register of members and share transfer books will shareholders who have not claimed their dividend for seven
remain closed from 14th August 2020 to 19th August, consecutive years or more and the newspaper advertisement
2020 (both days inclusive) for the payment of final dividend stating the same has been published in the newspapers.
to the shareholders of the Company, for the year ended on
31st March, 2020. In terms of the provisions of the Companies Act, 2013
and Investor Education and Protection Fund Authority
The Dividend will be paid to members within 30 days from (Accounting, Audit, Transfer and Refund) Rules, 2016 a
the date of declaration of dividend to the Members whose sum of `5,07,980/- which is unpaid/unclaimed dividends
names appear in the Register of Members as on 13th pertaining to the FY 2011-12 was transferred to the Investor
August, 2020. Education and Protection Fund during the year.
4
The list of equity shareholders whose shares are transferred to the approval of Members at the forth coming Annual
to IEPF can be accessed on the website of the Company at General Meeting (AGM) of the Company.
below mentioned link: www.autoaxle.com/Annual_reports.
aspx under the head IEPF Transfers In terms of the provisions of the Companies Act, 2013, Dr.
B. N. Kalyani, Director of the Company retires by rotation
Performance of the Company at the ensuing Annual General Meeting and, being eligible,
The total income for the financial year under review was offers himself for re-appointment.
`9,596.81 million as against `19,420.02 million for the
previous financial year. The Profit before tax (PBT) was Notice under section 160 of the Companies Act, 2013
`619.78 million for the financial year under review, as received from a member of the company proposing
against `1,853.11 million for the previous financial year. candidature of Mr. Srinivasan Kumaradevan. The company
has received from Mr. Srinivasan Kumaradevan i) consent
Share Capital in writing to act as a Director in Form DIR-2 pursuant to
The paid up Equity Share Capital as on 31st March, 2020 Rule 8 of the Companies (Appointment & Qualification
stood at `151.12 million. During the year under review, of Directors) Rules, 2014 and ii) intimation in Form DIR-
the Company has not issued shares with differential voting 8 pursuant to terms of the Companies (Appointment &
rights nor has granted any stock options nor sweat equity. Qualification of Directors) Rules, 2014, to the effect that he
is not disqualified as per section 164(2) of the Companies
Deposits Act, 2013 before his appointment;
Your Company has not accepted any deposits under Chapter
V of the Companies Act, 2013 during the year. Declaration by Independent Directors
The Company has received declarations from all the
Transfer to Reserve Independent Directors of the Company confirming that they
The company has not proposed any amount to be transferred meet with the criteria of independence and that there has
to the General Reserve. been no change in the circumstances which may affect their
status as independent director during the year as prescribed
Listing under sub-section (6) of Section 149 of the Companies Act,
The equity shares of the Company are listed with BSE Limited and 2013 and Securities and Exchange Board of India (Listing
National Stock Exchange of India Limited. There are no arrears Obligations and Disclosure requirements) Regulations, 2015.
on account of payment of listing fees to the Stock Exchanges.
Further the names of the Independent Directors of the
Directors & Key Managerial Personnel: Company have been included in the Data bank maintained
As on 31st March, 2020 there were seven (7) Directors by the Indian Institute of Corporate Affairs of Independent
on the Board of your Company, consisting of four (4) directors as per the provisions of the Companies Act 2013
Independent Directors, one (1) Executive Director and two and the rules made thereunder.
(2) Non-Executive Directors of whom one is the Chairman.
Board Evaluation:
During the year under review, the following changes have The Companies Act, 2013 states that a formal Annual
taken place in the Board of Directors of the Company: Evaluation needs to be made by the Board of its own
performance and that of its committees and individual
1. Dr. Muthukumar N. (DIN: 06708535) has resigned from Directors. Securities and Exchange Board of India (Listing
the position of whole time Director of the Company with Obligations and Disclosure Requirements) Regulations,
effect from 14th August 2019 due to his personal reason. 2015, mandates that the Board shall monitor and review the
Board evaluation framework. Pursuant to these provisions,
2. Mr. Srinivasan Kumaradevan (DIN: 08107660) has been the Company has developed a framework for the Board
appointed as an additional director designated as Senior evaluation. The framework includes evaluation on various
Vice President and Whole-time Director of the Company parameters such as information flow, Board dynamics,
w.e.f. 14th August 2019 for a period of five years subject decision making, company performance and strategy,
5
Board and committee’s effectiveness and peer evaluation. (a) in the preparation of the annual accounts for the year
ended 31st March, 2020, the applicable accounting
The evaluation of all the Directors and the Board as a standards have been followed along with proper
whole was conducted based on the criteria and framework explanation relating to material departures if any;
adopted by the Board.
(b) we have selected such accounting policies and applied
During the year 2019-20, Independent Directors met on them consistently and made judgments and estimates
10th February, 2020, discussed and reviewed the below: that are reasonable and prudent so as to give a true
and fair view of the state of affairs of the company as at
Performance of Non Independent Directors 31st March, 2020 and of the profit of the company for
the year ended on that date;
Performance of the Chairman
(c)
we have taken proper and sufficient care for the
Performance of the Board Committees maintenance of adequate accounting records in
accordance with the provisions of the Companies Act,
Discussed on the quality, quantity and timeliness of flow 2013 for safeguarding the assets of the company and for
of information between the Company management preventing and detecting fraud and other irregularities;
and the Board Members.
(d) we have prepared the annual accounts on a going
Overall performance of the Company. concern basis;
Familiarization program for the Board (e)

we have laid down internal financial controls to be
Members followed by the company and that such internal financial
Your Company has in place a structured induction and controls are adequate and were operating effectively;
familiarization programme for all its Directors including
Independent Directors and new appointee(s) to the (f) we have devised proper systems to ensure compliance
Board. Through such programs, the Directors are briefed with the provisions of all applicable laws and that such
on the background of your Company, their roles, rights, systems are adequate and operating effectively.
responsibilities, nature of the industry in which it operates,
business model operations, ongoing events etc. Auditors & Auditors’ Report
a. Statutory Auditors
The Board members are provided with the necessary M/s. S R Batliboi & Associates LLP, Chartered
documents, brochures, reports and internal policies to Accountants [Firm Registration No.: 101049W/
enable them to familiarize with the Company’s procedure E300004] is holding the position of Statutory Auditor
and practice. of the Company.
Periodic presentations are made at the Board Meetings, The Auditors’ Report does not contain any qualification,
Board Committee Meetings and Independent Directors reservation or adverse remarks.
Meetings on business and overall performance updates of
the Company, business strategy and risk involved. Further, no frauds have been reported by the Auditors
in their reports.
The details of programs for Familiarization for Independent
Directors are posted on the website of the Company and b. Internal Auditor
can be accessed at: www.autoaxle.com/Directors.aspx The Audit Committee and the Board of Directors
recommend for the re-appointment of M/s Price
Directors’ Responsibility Statement Waterhouse Coopers Services LLP as Internal Auditors of
Pursuant to the requirements under Section 134(5) of the the Company for the Financial Year 2020-21.
Companies Act, 2013 with respect to Directors’ Responsibility
Statement, your Directors make the following statements:
6
c. Secretarial Auditor with their terms of reference, composition and meeting of the
Pursuant to the provisions of the Section 204 of the Board and its Committees held during the year are provided
Companies Act, 2013 and the rules made there under in the Corporate Governance Report which is presented in a
and based on the recommendations of the Audit separate section forming part of the Annual Report.
Committee, CS Pracheta M, Practicing Company
Secretary has been appointed to conduct Secretarial A Certificate from CS. Pracheta M., Practicing Company
Audit of the Company’s secretarial and other related Secretary confirming compliance with the conditions of
records for the Financial year 2019-20. Corporate Governance as stipulated under the aforesaid
Regulation 34(3) Schedule V (E) of Securities and Exchange
The Secretarial Audit Report for the financial year Board of India (Listing Obligations and Disclosure
ended 31st March, 2020 in form MR-3 is appended to Requirements) Regulations, 2015 is attached to the
this report under Annexure – A Corporate Governance Report.
Explanation for observations made under Meetings of the Board

Secretarial Audit Report: During the financial year, the Board met four times, details of
which are provided in the Corporate Governance Report. The
As per reason mentioned in Annexure-G maximum interval between any two meetings did not exceed
120 days as prescribed under the Companies Act, 2013.
Internal Financial Control
The Board has adopted policies and procedures for ensuring Committees of the Board
the orderly and efficient conduct of its business, including Your Company has the following committees which have
adherence to the Company’s policies, the safeguarding of been established as a part of the corporate governance
its assets, the prevention and detection of frauds and errors, practices and are in compliance with the requirements of
the accuracy and completeness of the accounting records, the Companies Act, 2013 and the Securities and Exchange
and the timely preparation of reliable financial disclosures. Board of India (Listing Obligations and Disclosure
Requirement) Regulations, 2015.
During the year, such controls were tested and no reportable
material weaknesses in the design or operation were Audit Committee
observed.
Nomination and Remuneration Committee
Corporate Governance
Corporate Governance is about maximizing the value and Stakeholders Relationship Committee
to ensure fairness to all its shareholders. Your Company
is renowned for its exemplary governance standards and Corporate Social Responsibility Committee
believe that sound corporate governance is critical to
enhance and retain investor trust. Your Company ensures Risk Management Committee
that performance is driven by integrity.
The details with respect to the compositions, roles, number
The Companies Act, 2013 and the Securities and Exchange of meetings held during the year is detailed in the corporate
Board of India (Listing Obligations and Disclosure governance report of the Company, which forms a part of
Requirements) Regulations, 2015 have strengthened the this Board’s Report.
governance regime in the country and your Company is in
compliance with the governance requirements provided under Conservation of Energy, Technology
the law both in letter and spirit. The Board also exercises its Absorption and Foreign Exchange
fiduciary responsibilities in the widest sense of the term. Earnings and Outgo
The particulars relating to conservation of energy,
Your Company has in place all the statutory committees technology absorption, foreign exchange earnings and
required under the law. Details of the Board Committees along outgo, as required to be disclosed under Section 134 of
7
the Companies Act, 2013 read with Companies (Accounts) The Board has, on the recommendation of the Nomination
Rules, 2014 are appended as Annexure - B to this report. and Remuneration Committee, framed a policy for selection
and appointment of Directors, Key Managerial Personnel
Particulars of Remuneration of Directors and Senior Management Personnel and their remuneration.
& certain specified employees:
In terms of the provisions of Section 197(12) of the The Nomination and Remuneration policy is appended
Companies Act, 2013 read with Rule 5 of Companies as Annexure - E to this report and is also available on
(Appointment & Remuneration of Managerial Personnel) Company’s website at www.autoaxle.com/Policy.aspx.
Rules, 2014, the ratio of remuneration of each Director to
the median of the employees’ remuneration, a statement Particulars of contracts or arrangements
containing the names of top ten employees in terms of with Related Parties (RPT)
remuneration drawn and every employee who is employed The related party transactions that were entered into during
throughout the financial year and was in receipt of a the financial year were in the ordinary course of business
remuneration of `102 lakh per annum or more and of every and on the arm’s length basis.
employee who is employed part of the financial year, was in
receipt of remuneration of `8.50 lakh or more per month is All related party transactions are placed before the Audit
appended as Annexure - C. Committee and also the Board for approval. Prior omnibus
approval of the Audit Committee is obtained on a yearly
Extract of Annual Return 2019-20 basis for the transactions, which are foreseen and of
The detail forming part of the extract of Annual Return in repetitive nature.
MGT-9 is appended as Annexure – D to this report. The
Annual Return is also available at www.autoaxle.com. For transactions with Meritor HVS (India) Limited, the
Company has obtained shareholders’ approval at their
Particulars of Loans, Guarantees or 37th Annual General Meeting held on 13th August,
Investment under section 186 of the 2018 for transaction value annually of `30,000 million
Companies Act, 2013 p.a for a period of five (5) financial years starting from
Particulars of loans covered under section 186 of the 1st April, 2019.
Companies Act, 2013 form part of the notes to the financial
statement provided in this Annual Report. These loans Further, all transactions entered into pursuant to the omnibus
are primarily granted for furtherance of business of the approval so granted are reviewed and a statement giving
borrowing companies. details of all related party transactions is placed before
the Audit Committee and the Board of Directors for their
Your Company has not given any guarantee or provided approval on a quarterly basis.
any security in connection with a loan to any other body
corporate or persons and has not made any investment in In accordance with the requirements of the Companies Act,
the securities of any other body corporate. 2013 and Securities and Exchange Board of India (Listing
Obligations and Disclosure Requirements) Regulations,
Policy on Directors’ Appointment & 2015 your Company has formulated a Policy on Related
Remuneration Party Transactions which is also available on Company’s
The current policy is to have an appropriate mix of executive website at www.autoaxle.com/Policy.aspx.
and independent directors to maintain the independence
of the Board and separate its functions of governance and Related Party disclosures as per Indian Accounting Standards
management. On 31st March, 2020, the Board consisted (Ind AS) -24 have been provided in Note No. 36 to the
of seven members, one of whom is executive or whole- financial statement.
time director, two are non executive directors and four are
independent directors out of whom one is an Independent The particulars on RPTs in AOC 2 is annexed to the Report
Woman Director. as Annexure – F
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Risk Management System Business Responsibility Report

The Company has a robust risk management framework A detailed Business Responsibility Report in terms of the
comprising risk governance structure and defined risk provisions of Securities and Exchange Board of India (Listing
management processes. The risk governance structure of Obligations and Disclosure Requirements) Regulations,
the Company is a formal organisation structure with defined 2015 is available as a separate section in the Annual Report.
roles and responsibilities for risk management.
Vigil Mechanism
The processes and practices of risk management of the Your Company is committed to highest standards of ethical,
Company encompass risk identification, classification and moral and legal business conduct. Accordingly, the Board
evaluation. The Company identifies all strategic, operational of Directors have formulated a Whistle Blower Policy which
and financial risks that the Company faces, by assessing and is in compliance with the provisions of Section 177 of the
analysing the latest trends in risk information available internally Companies Act, 2013 and Regulation 22 of Securities and
and externally and using the same to plan for risk activities. Exchange Board of India (Listing Obligations and Disclosure
Requirement) Regulations, 2015. Under the policy, the
The Company has set up a Risk Management Committee Directors and Employees are free to report any violation of the
to review the risks faced by the Company and monitor applicable laws and regulations and the code of conduct of
the development and deployment of risk mitigation action the Company. The reportable matters are to be disclosed to the
plans and the status is updated to the members of the Audit Audit Committee. During the year under review, the Company
Committee and the Board of Directors on quarterly basis. has not received any complaints under the said mechanism.
Corporate Social Responsibility (CSR): Disclosure under the Sexual Harassment

The Company has been carrying out various Corporate of Women at Workplace (Prevention,
Social Responsibility (CSR) activities. These activities are in Prohibition and Redressal) Act, 2013
terms of section 135 read with Schedule VII of the Companies Your Company has always believed in providing a safe
Act, 2013 and Companies (Corporate Social Responsibility workplace for every individual working in Company’s
Policy) Rules, 2014. During the year the Company has spent premise through various interventions and practices. The
`25.26 million on various CSR activities. Company always endeavours to create and provide an
environment that is free from discrimination and harassment
The Annual Report on CSR activities that includes details including sexual harassment.
about the CSR policy developed and implemented by
the Company and CSR initiatives taken during the year is In terms of provisions of the Sexual Harassment of Women
appended to the Report as Annexure – G. at Workplace (Prevention, Prohibition and Redressal) Act,
2013, the Company has formulated a Policy to prevent Sexual
State of Company’s Affairs Harassment of Women at Workplace. The Company has also
Discussion on state of Company’s affairs has been covered constituted Internal Complaints Committee, as required under
as part of the Management Discussion and Analysis (MDA). the said enactment. During the year under review, there were
MDA for the year under review, as stipulated under Securities no cases filed pursuant to the Sexual Harassment of Women at
and Exchange Board of India (Listing Obligations and Workplace (Prevention, Prohibition and Redressal) Act, 2013.
Disclosure Requirements) Regulations, 2015, is presented in
a separate section forming part of the Annual Report. Significant or Material Orders
No significant or material orders were passed by the
Management Discussion and Analysis Regulators or Courts or Tribunals which impact the going
Report concern status and Company’s operations in future.
Pursuant to Regulation 34(2)(e) of Securities and Exchange
Board of India (Listing Obligations and Disclosure Material Changes and Commitments, if
Requirements) Regulations, 2015 Management Discussion any, affecting the Financial Position of
and Analysis Report is presented in a separate section the Company
forming part of the Annual Report. There were no adverse material changes or commitments
occurred after 31st March, 2020 which may affect the
9
financial position of the Company or may require disclosure. (QCFI) for Implementing best 5S practices, which was
re-certified by QCFI in December 2019
Subsidiaries, Joint Ventures and Associates
Your Company does not have any subsidiary, joint venture 6. Bagged seven Gold Awards and three Silver Awards
nor any associates. during Chapter Convention on Quality Concept
(CCQC-2019) in May 2019
Change in the nature of business
There is no change in the nature of business of your 7.
Won distinguish award for Allied Case Study
Company. Presentation and Excellence Award for Kaizen Model
Presentation during National Convention on Allied
Secretarial Standards: Concepts at Varanasi in December 2019
The Company has complied with the applicable secretarial
standards. 8. Bagged third place in district-level Safety Quiz & Safety
Skit competition organised by Deputy Director of
Awards and Recognition Factories & Boilers department, Karnataka
During FY 2019-20, your company received recognitions
from the following bodies/customers as listed below: Maintenance of Cost records
The maintenance of cost records as specified by the Central
1. Recognised for our support at all times and awarded Government under sub-section (1) of section 148 of the
us with the ‘BEST SUPPORT FOR VEHICLE OFF ROAD Companies Act, 2013, is required by the Company and
(VOR)’ in September 2019 by TATA Motors accordingly such accounts and records are made and
maintained
2.
Appreciated and rewarded with Gold Award for
Business Alignment by Ashok Leyland Acknowledgements
Your Directors wish to convey their gratitude and place on
3. Received recognition from VOLVO towards ‘Specialty record their appreciation for the employees at all levels for their
Vehicle Build & Support’ in November 2019 hard work, cooperation and dedication during the year. Your
Directors sincerely convey their appreciation to customers,
4.
Upgraded from B to A in VECV ‘KATA’ initiative in shareholders, bankers, business associates, regulatory and
October 2019 government authorities for their continued support.
5.
Got certified by Union of Japanese Scientists & Your Directors wish to place on record their appreciation
Engineers (JUSE) through Quality Circle Forum of India for the continued co-operation and support extended by
Kalyani Group, Pune, and Meritor Inc., USA
For and on behalf of the Board of Directors
Place : Pune B. N. Kalyani

Date : 26th May 2020 Chairman
10
Annexure A
Form No. MR-3
SECRETARIAL AUDIT REPORT
FOR THE FINANCIAL YEAR ENDED 31st MARCH, 2020
[Pursuant to section 204(1) of the Companies Act, 2013 and Rule 9 of the Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014]
To, (v) The following Regulations and Guidelines prescribed

The Members, under the Securities and Exchange Board of India Act,
Automotive Axles Limited 1992 (‘SEBI Act’):-
CIN: L51909KA1981PLC004198
(a)
The Securities and Exchange Board of India
I have conducted the secretarial audit of the compliance of (Substantial Acquisition of Shares and Takeovers)
applicable statutory provisions and the adherence to good Regulations, 2011;
corporate practices by AUTOMOTIVE AXLES LIMITED
(herein after called the Company). Secretarial Audit was (b)
conducted in a manner that provided me a reasonable basis (Prohibition of Insider Trading) Regulations, 2015;
for evaluating the corporate conducts/statutory compliances
and expressing my opinion thereon. (c)
(Issue of Capital and Disclosure Requirements)
Based on my verification of the Automotive Axles Limited’s Regulations, 2009;
books, papers, minute books, forms and returns filed and
other records maintained by the Company and also the (d) The Securities and Exchange Board of India (Share
information provided by the Company, its officers, agents and Based Employee Benefits), 2014; -Not applicable
authorized representatives during the conduct of secretarial since no share based employee benefits are issued
audit, I hereby report that in my opinion, the Company has,
during the audit period covering the financial year ended on (e) The Securities and Exchange Board of India (Issue
31st March 2020 complied with the statutory provisions listed and Listing of Debt Securities) Regulations, 2008;
hereunder and also that the Company has proper Board- Not applicable since no Debt securities are issued
processes and compliance-mechanism in place to the extent,
in the manner and subject to the reporting made hereinafter: (f)
(Registrars to an Issue and Share Transfer Agents)
I have examined the books, papers, minute books, forms and Regulations, 1993 regarding the Companies Act
returns filed and other records maintained by Automotive and dealing with client; -Not applicable since the
Axles Limited for the financial year ended on 31st March Company is not a Registrar and Share transfer
2020 according to the provisions of: agent
(i) The Companies Act, 2013 (the Act) and the rules made (g)
thereunder; (Delisting of Equity Shares) Regulations, 2009;
- Not applicable since the Company has not
(ii)
The Securities Contracts (Regulation) Act, 1956 applied for delisting; and
(‘SCRA’) and the rules made thereunder;
(h)
(iii) The Depositories Act, 1996 and the Regulations and (Buyback of Securities) Regulations, 1998; -Not
Bye-laws framed thereunder; applicable since the Company has not bought
back any securities;
(iv)
Foreign Exchange Management Act, 1999 and the
rules and regulations made thereunder to the extent of (vi) No laws are specifically applicable to the Company
Foreign Direct Investment, Overseas Direct Investment
and External Commercial Borrowings; I have also examined compliance with the applicable
clauses of the following:
11
(i)
Secretarial Standards issued by the Institute of Based on the management representation, I report that
Company Secretaries of India and notified by the majority decision is carried through while the dissenting
Central Government. members’ views are captured and recorded as part of
the minutes, though no such views were available in the
(ii)
Uniform Listing agreements with the Stock minutes and the management has informed that there were
Exchanges and the Securities and Exchange no dissenting views.
Board of India (Listing Obligations and Disclosure
Requirements) Regulations, 2015, and noted the I further report that based on the compliance mechanism
following: at the Company and based on the quarterly compliance
report of the management to the Board, there are adequate
uring the period under review the Company has complied
D systems and processes in the company commensurate with
with the provisions of the Act, Rules, Regulations, Guidelines, the size and operations of the company to monitor and
Standards, etc. mentioned above, subject to the following ensure compliance with applicable laws, rules, regulations
observations: and guidelines.
a. The Company has not spent full amount which is I further report that during the audit period, there are
mandated u/s 135 of the Companies Act, 2013 in no specific events/actions having a major bearing on
the CSR projects the Company’s affairs in pursuance of the laws, rules,
regulations, guidelines etc referred to above.
I further report that
The Board of Directors of the Company is duly constituted
with proper balance of Executive Directors, Non-Executive
Directors and Independent Directors. The changes in the
Signature:
composition of the Board of Directors that took place during
Name of Company Secretary in practice:
the period under review were carried out in compliance with
the provisions of the Act. Pracheta M.
FCS No.: 9323
Adequate notice is given to all directors to schedule the Place: Mysuru C P No.: 9838
Board Meetings, agenda and detailed notes on agenda Date: 26th May 2020 UDIN: F009323B000276436
were sent at least seven days in advance. A system exists for
seeking and obtaining further information and clarifications This report is to be read with my letter of even date which
on the agenda items before the meeting and for meaningful is annexed as Annexure A and forms an integral part of this
participation at the meeting. report.
12
Annexure A
To,
The Members of
Automotive Axles Limited 5. I have not verified the correctness and appropriateness
of financial records and books of accounts of the
My Secretarial audit report of even date is to be read along Company and hence unable to comment on the
with this letter. compliance with the fiscal laws.
1. The maintenance of Secretarial records is the responsibility 6. Wherever required, I have obtained the Management
of the management of the Company. Further, the representation about the Compliance of laws, rules
Company is also responsible for devising proper systems and regulations and happening of events etc.
and processes to ensure the compliance of the various
statutory requirements and Governance systems. 7. The Compliance of the provisions of Corporate and
other applicable laws, rules, regulations, standards is
2.
It is the responsibility of the management of the the responsibility of the management. My examination
Company to ensure that the systems and processes was limited to the verification of procedure on test
devised are operating effectively and efficiently. basis.
3.
My responsibility is to express an opinion on these 8. The Secretarial Audit report is neither an assurance
secretarial records based on our audit. as to the future viability of the Company nor of the
efficacy or effectiveness with which the management
4. I have followed the audit practices and process as were has conducted the affairs of the Company.
appropriate to obtain reasonable assurance about the
correctness of the contents of the Secretarial records. Signature:
The verification was done on test basis to ensure Name of Company Secretary in practice:
that correct facts are reflected in Secretarial records. Pracheta M.
I believe that the process and practices, I followed FCS No.: 9323
provide a reasonable basis for my opinion. Place: Mysuru C P No.: 9838
Date: 26th May 2020 UDIN: F009323B000276436
13
Annexure B
Information as per Section 134(3)(m) of the Companies Act, 2013, read with the Companies (Accounts) Rules, 2014
A. Conservation of Energy :
(a) The steps taken or impact on conservation of energy 1. Installation of VFD for high rated motor across the plant
2. Single loading transformer during holidays & non – working days
3. Installation and commissioning of Inverter type Eco friendly air
conditioners
4. Replacing 400W focus lamp with 120W LED lamp for Peripheral
area to reduce Power Consumption with standard illumination.
5. Online monitoring and management (vigilant) system
6. Installation of high Volume low speed (HVLS) Fan for shop floor
7. Installation of IGBT( Insulated gate bipolar transistor) based static
VAR(voltage current resistance) correction panel resulting in avoid 5
% power transmission loss and improved quality of power.
8. 2 lamp one switch control for shop floor Lighting – to reduce
needless load
9. Compressor automation across the plant
10. Installation & Commissioning of new PCC panel for Line wise
distribution
11. Installation and commissioning of 150W induction lamp for new
shed
12. LED light fixture for Office area
(b) The steps taken by the company for utilizing alternate 1. Green Power Purchase under Group captive mechanism
sources of energy 2. Perpetuation of Power purchase through Indian energy exchange
3. Installation of Auto Power Factor Correction Relay Panel (APFCR)
panel for Power Factor Improvement across the plant
4. Installation of 120W LED lights for peripheral area to reduce energy
and improve life
5. Installation of LED lights for shop office area in place of Compact
Fluorescent lamps to reduce energy and improve life
6. Installation of Variable Frequency Drive (VFD) panel for Heat
treatment cooling Tower
7. Endo gas generator
8. Air Compressor Automation for reduction of power Consumption
9. Installation Compressor & Blower settings optimized using Six Sigma
methodology
10. Air Compressor Automation for reduction of power Consumption
11. EHT Transmission line ( 66/11kV ) extending to VMI area to avoid
frequent interruption.
12. EHT Transmission line ( 66/11kV ) extending to R & D Block to avoid
frequent interruption.
13. Installation of VRF type Air conditioners for office block
14. Installation of HVLS fan for assembly area
15. New project & layout modification works
(c) The Capital investment on energy conservation Your Company made capital investments amounting to `7.20 Mn
equipment’s. approximately during the financial year 2019-20 on energy conservation
equipment.
14
B. Technology absorption:
1. The efforts made towards technology absorption: Design development of Swift15 design as a replacement to MS160
for domestic product. Swift15 is value engineered product to meet
evolving BS6 regulatory needs. Swift15 is expected to improve axle
efficiency ~0.5% to 1% with 3 liters lower lube volume compared to
predecessor MS160
MT846 axle is the medium duty hub reduction axle. Approach is to
have a modular design with existing carrier assembly designs and
new design wheel ends. Rig level design validation plan is in progress
for the MT846. Various application analysis is in progress with
various OEM.
MT 15I design is designed to more reliable and efficient axle. MT15I
design is complete and validation is in progress.
Development of higher capable axle MS177 for 41T to 45T
development has been completed. Higher capable axle is needed for
the axle load increase regulation changes and forthcoming auxiliary
retarder changes.
Development of higher capable axle MS185 for 46 to 55t has been
initiated. Higher capable axle is needed for the axle load increase
regulation changes and new 12X2 rigid truck
Development of MT145 for 55T tractor trailer haulage application.
This is needed to support evolving business needs for India market.
TLB axle development for back hoe loader application with wet disc
brake design. The design is currently being validated
Axle rig level test such as axle chucking fatigue, torsional fatigue,
lubrication flow & temperature rise have been domestically
commissioned to support local R&D efforts and new product
development support
Development of brakes to support safe axle load increase with
increased torque handling capacity
Development of new liner to address noise issues through field noise
data acquisition and data analysis & FEA.
2. The benefits derived like product improvement, Development and optimization of cast housing for machining time
cost reduction, product development or import reduction
substitution MT15I design improvement upto 30% more gear life compared to
current MT1497, also the axle is expected to have ~0.2 to ~0.5%
efficiency improvement in rear axle
Normalization elimination of brake flange to avoid reheating of parts
BS6 and MBP oil seepage solution addressed through MT15i, MS15i
& Swift15 design by having robust joint design
Axle shaft control cooling post forging, eliminating re-heating of
shafts
Migration from cut IAD gearing of 1497 to precision forged IAD gear
to improve life by 30% compared to baseline
3. In case of imported technology (imported during the NIL

last 3 years reckoned from the beginning of financial
year) :
a. Details of technology imported
b. The year of import
c. Whether the technology been fully absorbed
d. If not fully absorbed, areas where absorption has
not taken place, and the reasons thereof
15
4. Expenditure on R & D NIL

a. Capital
b. Recurring
c. Total
d. Total R & D expenditure as a percentage to total
turnover
C. Foreign Exchange Earnings and Outgo:

a. Activities relating to exports, initiative taken to NIL
increase exports, development of new export markets
for products and services and export plans
b. Total Foreign Exchange used and Earned:

`319.04 million [includes remittance of dividend for the FY 2018-19 &
Used
FY 2019-20 (interim dividend)]
Nil, as all the sales for export are routed through Meritor HVS (India) Ltd.,
Earned
Mysuru

16
Annexure C
Statement of Disclosure of Remuneration U/s 197 of Companies Act, 2013 and Rule 5(1) of
Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014:
I.
(i) the ratio of the remuneration of each Director to Refer below table
the median remuneration of the employees of the
company for the financial year;
(ii) the percentage increase in remuneration of :
(a) Director Refer below table
(b) Chief Financial Officer 4%
(c ) Company Secretary 6%
(iii) the percentage increase in the median remuneration of 4%
employees in the financial year
(iv) the number of permanent employees on the rolls of 1029
company as on 31st March 2020;
(v) average percentile increase already made in the Average percentage increase made in the salaries of the employees other
salaries of employees other than the managerial than managerial personnel in the last financial year i.e. 2019-20 was
personnel in the last financial year and its comparison 4.86% whereas the increase in the managerial remuneration for 2019-20
with the percentile increase in the managerial was 5.17%.
remuneration and justification thereof and point out if
there are any exceptional circumstances for increase
in the managerial remuneration;
It is hereby affirmed that the remuneration paid during the year is as per the Remuneration Policy of the Company.
atio of Remuneration of each Director to the Median remuneration of the Employees

R
of the Company
Ratio of remuneration of each Director
Sr. % Increase /(decrease)
Name of the Director Designation to the median remuneration of the
No in the remuneration*
employees of the Company
1 Dr. B N Kalyani Chairman, Non – Executive Director 0.35:1 300%

2 Mr. B B Hattarki Independent Director 0.69:1 0%
3 Mr. B C Prabhakar Independent Director 0.60:1 (13%)
4 Mr. Rakesh Kalra Independent Director 0.52:1 0%
5 Dr. Shalini Sarin Independent Director 0.35:1 300%
6 Dr. N Muthukumar Whole Time Director 12.36:1 (47%)
7 Mr. Srinivasan Kumaradevan Whole Time Director 11.08:1 0%
*Note:
Percentage increase in the remuneration i.e (sitting fees) of Directors, apart from Dr. N. Muthukumar & Mr. Srinivasan
Kumaradevan has been arrived by comparing the actual sitting fee paid during the last Financial Year.
17
II. Information required pursuant to Section 197(12) of the Companies Act, 2013 read
with the Rule 5(2) of the Companies (Appointment and Remuneration to Managerial
Personnel) Rules, 2014.
Related
Sl. Remuneration Experience Date of Last
Name Age Designation Qualification to any
No (In `) (years) employment employment
Director
1 Kumaradevan 53.1 Sr. Vice President BE (Mech), MS 31 6-Jun-19 L&T Valves No
Srinivasan & Whole Time 80,30,231 Limited
Director
2 Ranganathan S 52.9 Chief Financial 67,94,523 B.com, CA, Cost & 26 6-May-15 Circor Flow No
Officer Works Accountancy Technologies
India Pvt Ltd
3 Shivakumar R 56.9 Vice President BE (Mech), MS 35 4-Jan-85 NA No
63,76,995 (Engineering
Business
Management)
4 Muraleekrishnan V 50.8 GM- Sales B. Tech, M.Tech 25 13-Oct-08 M&M No
administration, 50,54,707
Customer Support
& MPS
5 Satish K S 54.8 GM - Quality, Dip (Mech), PGDMS 31 22-Nov-00 Gleason Works No
Service & 43,20,696 (Warwick) India Pvt Ltd
Metallurgy
6 Abdul Kareem 54.0 GM – Brakes, Dip (Mech) 33 17-Jan-87 NA No
Speciality Axles & 35,21,828
JSR, PNR Plants
7 Murali Barki B 58.0 GM - Strategic BE(Mech) 30 1-Jul-94 Beaver No
(Superannuating on Sourcing 34,26,346 Automotive(P) Ltd
30th Mar'2020)
8 Manjunatha S 58.5 DGM - ER/IR MSW, LLB 33 23-Sep-19 BOSCH Ltd No
33,12,016
9 C N S Srinivas 45.7 AGM - Customer Dip (Automobile 26 2-May-13 Casper Industries No
Contact Zero KM & 31,67,765 Engineering), BA, pvt ltd
Field Service MBA
10 Dhiraj Banerjee 45.8 AGM - Gear B Tech (Mech), 19 18-Dec-17 Gleason Works No
Manufacturing 31,02,482 PGDBA (Operations India Pvt Ltd
- Distance)
11 Rama Kantha Rao 41.7 AGM - Dip (Mech), B Tech 17 10-May-18 Tata Motors Ltd, No
Bonda Improvement 30,73,173 (Mech), PG course Jamshedpur
Projects in Tool, Die &
Mould Design
12 Dr. Muthukumar N 55 President & Whole 77,85,064/- M. Sc., MBA, Phd 32 16-Apr-08 T.T.K Ltd No
(Exit -3rd Sep 2019) Time Director
13 Mr. Muthusamy E 58 General Manager– 50,05,330/- Dip(Electrical), B. 38 2-May-08 TVS Motor No
(Superannuated on Capex & Projects Sc. (Engineering Company Ltd
19th July 2019) Technology),
MS(Mfg.Mgt)
Notes:
1. The nature of the employment is permanent and the terms of remuneration in the case of President and Wholetime Director is governed under the Board’s and
members’ resolution.
2. None of the above employee hold any shares in the Company except Mr. Ranganathan S who holds 102 no. of shares as on 31st March, 2020.
3. Gross Remuneration includes Salary, Allowances and other perks like Leave Travel Allowance, Medical reimbursement and Company’s contribution towards Provident
Fund, Gratuity and Superannuation.
4. Dr. Muthukumar N., President & Whole Time Director of the company ceased from the Company on 3rd September, 2019, Mr. Muthusamy E. superannuated on19th July, 2019
and Mr. Murali Barki B Superannuated on 30th March, 2020.

18
Annexure D
Form No. MGT-9
EXTRACT OF ANNUAL RETURN AS ON THE FINANCIAL YEAR ENDED ON 31st MARCH, 2020
[Pursuant to Section 92(3) of the Companies Act, 2013 and Rule 12(1) of the
Companies (Management and Administration) Rules, 2014]
I. REGISTRATION AND OTHER DETAILS
i. CIN L51909KA1981PLC004198
ii. Registration Date 21.04.1981
iii. Name of the Company Automotive Axles Limited
iv. Category / Sub-Category of the Company Public Company Limited by shares/Indian Non-Government
Company
v. Address of the Registered office and contact details Hootagalli Industrial Area, Off Hunsur Road, Mysuru – 570 018
Ph : 0821-7197500, fax : 0821 2402451,
email : sec@autoaxle.com
vi. Whether listed company Yes
vii. Name, Address and Contact details of Registrar and Integrated Registry Management Services Pvt. Ltd
Transfer Agent, if any #30, Ramana Residency, 4th Cross, Sampige Road,
Malleshwaram, Bengaluru, Karnataka
Ph:080-23460815
Email: irg@integratedindia.in
II. PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY
All the business activities contributing 10 % or more of the total turnover of the company shall be stated:-
Sr. Name and Description of main products / services NIC Code of the % to total turnover of
No. Product/ service the company
1 Rear Drive Axles 29301 59.27%
2 Brakes 29301 20.65%
3 Other Parts 29301 20.09%
III. PARTICULARS OF HOLDING, SUBSIDIARY AND ASSOCIATE COMPANIES
Sr. Name And Address Of The CIN/GLN Holding/ Subsidiary % of shares held Applicable
No. Company /Associate Section
1 Nil
19
IV. SHARE HOLDING PATTERN (Equity Share Capital Breakup as percentage of Total
Equity)
i. Category-wise Share Holding

No. of Shares held at the beginning of the No. of Shares held at the end of the
Category of year - 01.04.2019 year - 31.03.2020 % change
Shareholders during the year
% of Total % of Total
Demat Physical Total Demat Physical Total
Shares Shares
A. Promoters
(1) Indian
a) Individual/HUF - - - - - - - - -
b) Central Govt.or State - - - - - - - - -
Govt.
c) Bodies Corporates 5367806 - 5367806 35.52 5367806 - 5367806 35.52 -
d) Bank/FI - - - - - - - - -
e) Any other - - - - - - - - -
SUB TOTAL:(A) (1) 5367806 - 5367806 35.52 5367806 - 5367806 35.52 -
(2) Foreign
a) NRI- Individuals - - - - - - - - -
b) Other Individuals - - - - - - - - -
c) Bodies Corp. 5367275 - 5367275 35.52 5367275 - 5367275 35.52 -
d) Banks/FI - - - - - - - - -
e) Any other - - - - - - - - -
SUB TOTAL (A) (2) 5367275 - 5367275 35.52 5367275 - 5367275 35.52 -
Total Shareholding 10735081 - 10735081 71.04 10735081 - 10735081 71.04

of Promoter
(A)= (A)(1)+(A)(2)
B. Public Shareholding
(1) Institutions
a) Mutual Funds 1407880 588 1408468 9.32 1466613 588 1467201 9.71 0.39
b) Banks/FI 15923 - 15923 0.11 9815 - 9815 0.06 -0.05
c) Central Govt. - - - - - - - - -
d) State Govt. - - - - - - - - -
e) Alternative Investment 3185 - 3185 0.02 - - - - -0.02
Funds
f) Insurance Companies - - - - 619156 - 619156 4.10 4.10

g) FIIS 192914 - 192914 1.28 126345 - 126345 0.84 -0.44
h) Foreign Venture - - - - - - - - -
Capital Funds
i) Others (specify) - - - - - - - - -
SUB TOTAL (B)(1): 1619902 588 1620490 10.72 2221929 588 2222517 14.71 3.98
20
No. of Shares held at the beginning of the No. of Shares held at the end of the
Category of year - 01.04.2019 year - 31.03.2020 % change
Shareholders during the year
% of Total % of Total
Demat Physical Total Demat Physical Total
Shares Shares
(2) Non Institutions
a) Bodies corporates
i) Indian 921838 88 921926 6.10 252540 88 252628 1.67 -4.43
ii) Overseas - - - - - - - - -
b) Individuals
i) Individual shareholders 1486763 70667 1557430 10.31 1488907 64519 1553426 10.28 -0.03
holding nominal share
capital upto `1 lakhs
ii) Individuals 104335 - 104335 0.69 198521 - 198521 1.31 0.62
shareholders holding
nominal share capital
in excess of `1 lakhs
c) Others (specify)
NRI 99796 100 99896 0.66 92996 100 93096 0.62 -0.04
Clearing Member 41281 - 41281 0.27 25320 - 25320 0.17 -0.10

Trusts - - - - - - - - 0.00
IEPF 31536 - 31536 0.21 31386 - 31386 0.21 0.00
SUB TOTAL (B)(2): 2685549 70855 2756404 18.24 2089670 64707 2154377 14.26 -3.98
Total Public
Shareholding 4305451 71443 4376894 28.96 4311599 65295 4376894 28.96 0.00
(B)= (B)(1)+(B)(2)
C. Shares held by
Custodian for GD`& - - - - - - - - -
ADRs
Grand Total (A+B+C) 15040532 71443 15111975 100.00 15046680 65295 15111975 100.00 0.00
ii. Shareholding of Promoters
% change in share
Shareholding at the beginning of the year Shareholding at the end of the year
holding during
01.04.2019 31.03.2020
the year
Sr.
Shareholder’s Name % of Shares % of Shares
No % of total % of total
Pledged / Pledged /
No. of Shares Shares of No. of Shares Shares of the
encumbered to encumbered to
the Co. Co.
total shares total shares
1. BF Investment Limited 53,67,806 35.52 - 53,67,806 35.52 - No Change
2. Meritor Heavy Vehicle 53,67,275 35.52 - 53,67,275 35.52 - No Change
Systems LLC, USA
Total 1,07,35,081 71.04 - 1,07,35,081 71.04 -
21
iii. Change in Promoters’ Shareholding (please specify, if there is no change)
Shareholding at the beginning of the Shareholding at the end of the

year 01.04.2019 year 31.03.2020
Particulars
% of total shares % of total shares
No. of shares No. of shares
of the company of the company
At the beginning of the year 1,07,35,081 71.04 1,07,35,081 71.04
Date wise Increase / Decrease in Promoters Share holding
No change
during the year specifying the reasons for increase/decrease
At the End of the year 1,07,35,081 71.04 1,07,35,081 71.04
iv. Shareholding pattern of top ten shareholders (other than Directors & Promoters)
SHAREHOLDING AT THE CUMULATIVE

BEGINNING OF THE SHAREHOLDING DURING
YEAR - 01.04.2019 Increase/ THE YEAR - 31.03.2020
SL NAME OF THE SHARE Reason
% of Total Date Decrease in % of Total
NO HOLDER
No. of Shares Shares of the Share Holding No of Shares Shares of the
Company Company
1 RELIANCE CAPITAL 891000 5.90 01.04.2019 0 - 891000 5.90
TRUSTEE CO. LTD. - 17.05.2019 18000 Transfer 909000 6.02
A/C RELIANCE TAX 24.05.2019 9000 Transfer 918000 6.07
SAVER (ELSS) FUND 31.05.2019 7200 Transfer 925200 6.12
14.06.2019 9000 Transfer 934200 6.18
05.07.2019 5371 Transfer 939571 6.22
12.07.2019 32429 Transfer 972000 6.43
13.03.2020 2779 Transfer 974779 6.45
31.03.2020 974779 6.45
2 BAJAJ ALLIANZ 597713 3.96 01.04.2019 0 - 597713 3.96

LIFE INSURANCE 05.04.2019 7000 Transfer 604713 4.00
COMPANY LTD. 12.04.2019 2000 Transfer 606713 4.01
26.04.2019 3700 Transfer 608413 4.03
24.05.2019 2143 Transfer 610556 4.04
05.07.2019 5000 Transfer 615556 4.07
26.07.2019 -4830 Transfer 610726 4.04
02.08.2019 -200 Transfer 610526 4.04
23.08.2019 -1300 Transfer 609226 4.03
30.08.2019 -2000 Transfer 607226 4.02
06.09.2019 1000 Transfer 608226 4.02
20.09.2019 -1600 Transfer 606626 4.01
30.09.2019 3270 Transfer 609896 4.04
04.10.2019 5000 Transfer 614896 4.07
11.10.2019 -2200 Transfer 612696 4.05
01.11.2019 2000 Transfer 614696 4.07
08.11.2019 -12000 Transfer 602696 3.99
15.11.2019 -6540 Transfer 596156 3.94
22.11.2019 -16600 Transfer 579556 3.84
29.11.2019 -4400 Transfer 575156 3.81
06.12.2019 9000 Transfer 584156 3.87
13.12.2019 1000 Transfer 585156 3.87
20.12.2019 1000 Transfer 586156 3.88
22

NO HOLDER
Company Company
27.12.2019 2000 Transfer 588156 3.89
31.12.2019 700 Transfer 588856 3.90
03.01.2020 4300 Transfer 593156 3.93
31.01.2020 6000 Transfer 599156 3.96
07.02.2020 18000 Transfer 617156 4.08
27.03.2020 2000 Transfer 619156 4.10
31.03.2020 619156 4.10
3 RELIANCE CAPITAL 400000 2.65 01.04.2019 0 400000 2.65

TRUSTEE CO. LTD- 14.06.2019 1000 Transfer 401000 2.65
A/C RELIANCESMALL 16.08.2019 2000 Transfer 403000 2.67
30.08.2019 1000 Transfer 404000 2.67
31.03.2020 0 404000 2.67
4 EMERGING MARKETS 55057 0.36 01.04.2019 0 - 55057 0.36

CORE EQUITY
PORTFOLIO (THE 26.07.2019 856 Transfer 55913 0.37
PORTFOLIO) 31.03.2020 55913 0.37
5 IIFL SECURITIES 47611 0.32 01.04.2019 0 47611 0.32

LIMITED 05.04.2019 -1506 Transfer 46105 0.31
14.06.2019 -46105 Transfer 0 0.00
31.03.2020 0 0.00
6 RELIANCE CAPITAL 45000 0.30 01.04.2019 0 45000 0.30

TRUSTEE CO LTD-A/C 05.04.2019 18000 Transfer 63000 0.42
RELIANCE CAPITAL 31.03.2020 63000 0.42
7 CANARA ROBECO 37806 0.25 01.04.2019 0 37806 0.25

MUTUAL FUND A/C 24.05.2019 5800 Transfer 43606 0.29
CANARA ROBECO 31.05.2019 2286 Transfer 45892 0.30
SMALL 01.11.2019 -13119 Transfer 32773 0.22
08.11.2019 -11018 Transfer 21755 0.14
29.11.2019 -21755 Transfer 0 0.00
31.03.2020 0 0.00
23

NO HOLDER
Company Company
8 ACADIAN EMERGING 37043 0.25 01.04.2019 0 37043 0.25
MARKETS SMALL CAP 12.04.2019 -551 Transfer 36492 0.24
EQUITY FUND LLC 17.05.2019 -437 Transfer 36055 0.24
24.05.2019 -3394 Transfer 32661 0.22
31.05.2019 -4117 Transfer 28544 0.19
07.06.2019 -3891 Transfer 24653 0.16
14.06.2019 -1081 Transfer 23572 0.16
30.06.2019 -1683 Transfer 21889 0.14
19.07.2019 -1648 Transfer 20241 0.13
26.07.2019 -5486 Transfer 14755 0.10
02.08.2019 -5902 Transfer 8853 0.06
09.08.2019 -1947 Transfer 6906 0.05
16.08.2019 -3067 Transfer 3839 0.03
23.08.2019 -3045 Transfer 794 0.01
30.08.2019 -794 Transfer 0 0.00
31.03.2020 0 0.00
9 THE EMERGING 36800 0.24 01.04.2019 0 36800 0.24

MARKETS SMALL CAP
SERIES OF THE DFA 03.05.2019 618 Transfer 37418 0.25
INVESTMENT TRUST 10.05.2019 732 Transfer 38150 0.25
COMP 30.06.2019 785 Transfer 38935 0.26
13.12.2019 -1408 Transfer 37527 0.25
24.01.2020 881 Transfer 38408 0.25
14.02.2020 878 Transfer 39286 0.26
31.03.2020 -2419 Transfer 36867 0.24
10 INVESTOR 31536 0.21 01.04.2019 0 31536 0.21

EDUCATION AND
PROTECTION FUND 30.09.2019 -100 Transfer 31436 0.21
AUTHORITY MINISTRY 06.12.2019 -25 Transfer 31411 0.21
OF CORPORATE 28.02.2020 -25 Transfer 31386 0.21
AFFAIRS 31.03.2020 31386 0.21
11 UTI 28227 0.19 01.04.2019 0 28227 0.19

TRANSPORTATION 31.01.2020 -3280 Transfer 24947 0.17
AND LOGISTICS 14.02.2020 -1155 Transfer 23792 0.16
FUND 31.03.2020 0 23792 0.16
24

NO HOLDER
Company Company
12 KAMLESH NAVIN 0 0.00 01.04.2019 0 0 0.00

SHAH 21.02.2020 7299 Transfer 7299 0.05
20.03.2020 31300 Transfer 38599 0.26
31.03.2020 0 38599 0.26
13 KAMAL NAYAN 0 0.00 01.04.2019 0 0 0.00

SARAOGI 31.12.2019 27440 Transfer 27440 0.18
03.01.2020 5850 Transfer 33290 0.22
31.03.2020 0 33290 0.22
14 NOVEL SUPPLIERS 27118 0.18 01.04.2019 No Movement during the year

PVT LTD 31.03.2020 27118 0.18
*Reasons for Change

1 Bought from Secondary Market
2 Sold in Secondary Market
3 No Change
V. Shareholding of Directors and Key Managerial Personnel:

Shareholdings at the beginning of Cumulative holding during the year
Sl. the year 01.04.2019 (01.04.2019 – 31.03.2020)
Particulars of each Director & KMP
No.
No. of shares % of total shares No. of shares % of total shares
1 Dr. B N Kalyani (DIN - 00089380)
At the beginning of the year 126 - 126 -
Increase / Decrease during the year - - - -
At the End of the year 126 - 126 -
2 B C Prabhakar (DIN - 00040052)
3 Ranganathan S. (Chief Financial Officer)
4 Debadas Panda (Company Secretary)
25
VI. Indebtedness:
Indebtedness of the Company including interest outstanding/ accrued but not due for payment
( ` in million)
Secured Loans
Particulars excluding Unsecured Loans Deposits Total
deposits
Indebtedness
Indebtedness at the beginning of Financial Year
i) Principal Amount 730.00 NIL NIL 730.00
ii) Interest due but not paid NIL NIL NIL NIL
iii) Interest accrued but not due NIL NIL NIL NIL
Total (i+ii+iii) 730.00 NIL NIL 730.00
Change during the Financial Year
- Addition NIL NIL NIL NIL
- Reduction 500.83 NIL NIL 500.83
Net Change (500.83) NIL NIL (500.83)
Indebtedness at the end of the Financial Year
i) Principal Amount 229.17 NIL NIL 229.17
ii) Interest due but not paid Nil NIL NIL Nil
iii) Interest accrued but not due 1.94 NIL NIL 1.94
Total (i+ii+iii) 231.11 NIL NIL 231.11
VII. Remuneration of Directors & Key Managerial Personnel :

A. Remuneration to Managing Director, Whole-time Directors and/or Manager
Dr. N Muthukumar Kumaradevan Srinivasan,

Sl. Whole Time Director Whole Time Diretor
Particulars of Remuneration
No. (Rupees in million) (Rupees in million)
(Upto 14.08.2019) (W.e.f. 14.08.2019)
1. Gross salary
(a) Salary as per provisions contained in section 17(1) of the Income- 5.13 6.11
tax Act, 1961
(b) Value of perquisites u/s 17(2) Income-tax Act, 1961 - -
(c) Profits in lieu of salary under section 17(3) Income- tax Act, 1961 - -
2. Stock Option - -
3. Sweat Equity - -
4. Commission & Others 2.02 0.31
5. Total 7.15 6.42
Ceiling as per the Act 93.24
26
B. Remuneration to other directors:
Total Amount
Particulars of Remuneration Name of Director
(` in million)
Independent Directors B B Hattarki BC Prabhakar Rakesh Kalra Shalini Sarin
Sitting Fee 0.40 0.35 0.30 0.20 1.25
Commission & others - - - - -
Total (1) 0.40 0.35 0.30 0.20 1.25
Other Non-Executive Directors B N Kalyani Chrishan
Villavarayan
Sitting Fee 0.20 Nil 0.20

Commission & others - -
Total (2) 0.20 - 0.20
Total (B)=(1+2)
Total Managerial Remuneration 1.45
Overall Ceiling as per the Act * `1.00 Lac Per

meeting of the
Board or Committee
thereof
* Other Directors did not receive any remuneration other than the sitting fees
C. Remuneration to Key Managerial Personnel Other Than MD /Manager /WTD
Sl. Ranganathan S CFO

Particulars of Remuneration
No. (` in million)
1. Gross salary
(a) Salary as per provisions contained in section 17(1) of the Income-tax Act, 1961 6.29
(b) Value of perquisites u/s 17(2) Income-tax Act, 1961 -
(c) Profits in lieu of salary under section 17(3) Income- tax Act, 1961 -
2. Stock Option -
3. Sweat Equity -
4. Commission & Others 0.50
5. Total 6.79
D. Remuneration to Key Managerial Personnel Other Than MD /Manager /WTD
Debadas Panda
Sl.
Particulars of Remuneration Company Secretary
No.
(` in million)
1 Gross salary
(a) S alary as per provisions contained in section 17(1) of the Income-tax Act, 1961 2.01
(b) Value of perquisites u/s 17(2) Income-tax Act, 1961 -
(c) Profits in lieu of salary under section 17(3) Income- tax Act, 1961 -
2. Stock Option -
3. Sweat Equity -
4. Commission & Others 0.16
5. Total 2.17
27
VIII. Penalties/Punishment/Compounding of Offences:

Details of
Penalty/
Section of the Authority[RD / Appeal made. If
Type Brief description Punishment/
companies Act NCLT/Court] any(give details)
Compounding
fees imposed
A. Company
Penalty
Punishment Nil
Compounding
B. Directors
Penalty
Punishment Nil
Compounding
C. Other Officers In Default
Penalty
Punishment Nil
Compounding

28
Annexure E
NOMINATION AND REMUNERATION POLICY
The Board of Directors of Automotive Axles Limited (“the 2.4.3. Company Secretary;
Company”) constituted the “Nomination and Remuneration
Committee” (“Committee”) at the Meeting held on 29th 2.5. Listing Agreement means the Listing Agreement,
April, 2014 with immediate effect. as amended from time to time, executed with Stock
Exchanges for Listing of Securities of the Company.
1. OBJECTIVE
The Committee and this Nomination and Remuneration 2.6. Senior Management
Policy (“Policy”) are in terms of provisions of the Companies shall mean all members of management one level below the
Act, 2013 and SEBI (Listing Obligations and Disclosure whole time director including company secretary and chief
Requirements) Regulations, 2015. The Key Objectives of the financial officer.
Committee would be:
The terms used in this Policy but not defined shall have
1.1. To guide the Board in relation to appointment and removal the meaning assigned to such terms in the Act and the
of Directors, Key Managerial Personnel (hereinafter Regulations.
referred to as “KMP”) and Senior Management.
3. ROLE OF COMMITTEE
1.2.
To evaluate the performance of the members of the 3.1. Matters to be dealt with, perused and recommended to the
Board and provide necessary report to the Board for Board by the Nomination and Remuneration Committee
further evaluation of the Board.
The Committee shall:
1.3. To recommend to the Board on Remuneration payable 3.1.1.
Formulation of the criteria for determining
to the Directors, KMP and Senior Management. qualifications, positive attributes and
independence of a director and recommend
1.4.
To provide to KMP and Senior Management reward to the board of directors a policy relating
linked directly to their effort, performance, dedication to, the remuneration of the directors, key
and achievement relating to the Company’s operations. managerial personnel and other employees;
1.5. To retain, motivate and promote talent and to ensure 3.1.2.
Formulation of criteria for evaluation of
long term sustainability of talented managerial persons performance of independent directors and
and create competitive advantage. the board of directors;
1.6. To devise a policy on Board diversity. 3.1.3.

Devising a policy on diversity of board of
directors;
1.7.
To develop a succession plan for the Board and to
regularly review the plan; 3.1.4.
Identifying persons who are qualified to
become directors and who may be appointed
2. DEFINITIONS in senior management in accordance with
2.1. Act means the Companies Act, 2013 and Rules framed the criteria laid down, and recommend to
thereunder, as amended from time to time. the board of directors their appointment and
removal.
2.2. Board means Board of Directors of the Company.
3.1.5.
whether to extend or continue the term of
2.3. Directors mean Directors of the Company. appointment of the independent director,
on the basis of the report of performance
2.4. Key Managerial Personnel (KMP) means evaluation of independent directors.
2.4.1. Whole-time Directors; 3.1.6. Recommend to the board, all remuneration,

in whatever form, payable to senior
2.4.2. Chief Financial Officer; and management.
29
3.2. Policy for appointment and removal of Director, KMP b) Independent Director:
and Senior Management An Independent Director shall hold office for
a term up to five consecutive years on the
3.2.1. Appointment criteria and qualifications Board of the Company and will be eligible
a) The Committee shall identify and ascertain the for re-appointment on passing of a special
integrity, qualification, expertise and experience of resolution by the Company and disclosure of
the person for appointment as Director, KMP or at such appointment in the Board’s report.
Senior Management level and recommend to the
Board his / her appointment. c) Non Executive Director:
The Company shall not appoint or continue
b) A person should possess adequate qualification, the directorship of any person as a non-
expertise and experience for the position he / she executive director who has attained the age of
is considered for appointment. The Committee seventy five years unless a special resolution
has discretion to decide whether qualification, is passed by the shareholders to that effect.
expertise and experience possessed by a person
are sufficient / satisfactory for the concerned 3.2.3. Evaluation
position. The Committee shall carry out yearly evaluation
of performance of every Director, KMP and Senior
c) The Company shall not appoint or continue the Management Personnel as per the requirement of Act/
employment of any person as Whole-time Director Listing Agreement.
who is below the age of twenty-one years or has
attained the age of seventy years. Provided that 3.2.4. Removal
the term of the person holding this position may Due to reasons for any disqualification mentioned in
be extended beyond the age of seventy years with the Act or under any other applicable Act, rules and
the approval of shareholders by passing a special regulations thereunder, the Committee may recommend,
resolution based on the explanatory statement to the Board with reasons recorded in writing, removal
annexed to the notice for such motion indicating of a Director, KMP or Senior Management Personnel
the justification for extension of appointment subject to the provisions and compliance of the said
beyond seventy years. Act, rules and regulations.
d)
The Committee shall decide on whether to 3.2.5. Retirement
extend or continue the term of appointment of The Director, KMP and Senior Management Personnel
Independent director, on the basis of the report of shall retire as per the applicable provisions of the Act
performance evaluation of Independent directors. and the prevailing policy of the Company. The Board
will have the discretion to retain the Director, KMP,
3.2.2. Term / Tenure Senior Management Personnel in the same position/
a) Whole-time Director: remuneration or otherwise even after attaining the
The Company shall appoint or re-appoint retirement age, for the benefit of the Company.
any person as its Whole-time Director for a
term not exceeding five years at a time or 3.3. Policy relating to the Remuneration for the Whole-time
for such period as prescribed under the Act/ / Executive Director, KMP and Senior Management
Listing Agreements. No re-appointment shall Personnel
be made earlier than one year before the
expiry of term.
30
3.3.1. General: covered under Clause 2.6; provided however

a)
The remuneration / compensation / that such actions taken by the Chairman shall be
commission etc. to the Whole-time Director, placed before the Committee for ratification in
KMP and Senior Management Personnel the succeeding meeting.
will be determined by the Committee and
recommended to the Board for approval. The 3.3.2. Remuneration to Whole-time /
remuneration / compensation / commission Executive Director, KMP and Senior
etc. shall be subject to the prior/post approval Management Personnel:
of the shareholders of the Company and a) Fixed pay:
Central Government, wherever required. The Whole-time Director/ KMP and Senior
Management Personnel shall be eligible for
b)
The remuneration and commission to be a monthly remuneration as may be approved
paid to the Whole-time Director shall be by the Board on the recommendation of the
in accordance with the percentage / slabs Committee. The breakup of the pay scale and
/ conditions laid down in the Articles of quantum of perquisites including, employer’s
Association of the Company and as per the contribution to P.F, pension scheme, medical
provisions of the Act. expenses, club fees etc. shall be decided and
approved by the Board/ the Person authorized
c)
Increments to the existing remuneration/ by the Board on the recommendation of the
compensation structure may be Committee and approved by the shareholders
recommended by the Committee to the Board and Central Government, wherever required.
which should be within the slabs approved by
the Shareholders in the case of Whole-time b) Minimum Remuneration:
Director. If, in any financial year, the Company has
no profits or its profits are inadequate, the
d) Where any insurance is taken by the Company Company shall pay remuneration to its
on behalf of its Whole-time Director, Chief Whole-time Director in accordance with the
Financial Officer, the Company Secretary and provisions of Schedule V of the Act and if it
any other employees for indemnifying them is not able to comply with such provisions,
against any liability, the premium paid on such with the previous approval of the Central
insurance shall not be treated as part of the Government.
remuneration payable to any such personnel.
Provided that if such person is proved to be c) Provisions for excess remuneration:
guilty, the premium paid on such insurance If any Whole-time Director draws or receives,
shall be treated as part of the remuneration. directly or indirectly by way of remuneration
any such sums in excess of the limits prescribed
e)
In case any difficulty or doubt arises in the under the Act or without the prior sanction of
interpretation or implementation of this Policy, the Central Government, where required, he
the decision of the Chairman of the Company / she shall refund such sums to the Company
shall be final. In exceptional circumstances, and until such sum is refunded, hold it in trust
the Chairman shall be authorized to exercise for the Company. The Company shall not
functions vested in the committee in so far as waive recovery of such sum refundable to it
these relate to Key Managerial Personnel covered unless permitted by the Central Government.
under Clause 2.4 and the Senior Management
31
3.3.3. Remuneration to Non- Executive / 5. CHAIRPERSON

Independent Director: 5.1 Chairperson of the Committee shall be an Independent
a) Remuneration / Commission: Director.
The remuneration / commission shall be fixed
as per the slabs and conditions mentioned in 5.2 Chairperson of the Company may be appointed as a
the Articles of Association of the Company member of the Committee but shall not be a Chairman
and the Act. of the Committee.
b) Sitting Fees: 5.3 In the absence of the Chairperson, the members of the
The Non- Executive / Independent Director Committee present at the meeting shall choose one
may receive remuneration by way of fees for amongst them to act as Chairperson.
attending meetings of Board or Committee
thereof. Provided that the amount of such 5.4
Chairman of the Nomination and Remuneration
fees shall not exceed `1,00,000/- (Rupees Committee meeting may be present at the Annual
One Lac Only) per meeting of the Board General Meeting or may nominate some other member
or Committee or such amount as may be to answer the shareholders’ queries.
prescribed by the Central Government from
time to time. 6. FREQUENCY OF MEETINGS
The meeting of the Committee shall be held at such regular
c) Commission: intervals as may be required provided that it shall be held at
Commission may be paid within the monetary least once in a year.
limit approved by shareholders, subject to the
limit not exceeding 1% of the profits of the 7. COMMITTEE MEMBERS’ INTERESTS
Company computed as per the applicable 7.1
A member of the Committee is not entitled to be
provisions of the Act. present when his or her own remuneration is discussed
at a meeting or when his or her performance is being
4. MEMBERSHIP evaluated.
4.1
The Committee shall consist of a minimum 3 non-
executive directors, at least 50% of them being 7.2
The Committee may invite such executives, as it
independent. considers appropriate, to be present at the meetings of
the Committee.
4.2 Either two members or one third of the members of the
committee, whichever is greater, including at least one 8. SECRETARY
independent director in attendance The Company Secretary of the Company shall act as
Secretary of the Committee.
4.3 Membership of the Committee shall be disclosed in the
Annual Report. 9. VOTING
9.1
Matters arising for determination at Committee
4.4
Term of the Committee shall be continued unless meetings shall be decided by a majority of votes of
terminated by the Board of Directors. Members present and voting and any such decision
shall for all purposes be deemed a decision of the
Committee.
32
9.2 In the case of equality of votes, the Chairman of the 10.9 Recommend any necessary changes to the Board;
meeting will have a casting vote. and
10. NOMINATION DUTIES 10.10

Considering any other matters, as may be
The duties of the Committee in relation to nomination requested by the Board.
matters include:
11. REMUNERATION DUTIES
10.1 Ensuring that there is an appropriate induction in The duties of the Committee in relation to remuneration
place for new Directors and members of Senior matters include:
Management and reviewing its effectiveness;
11.1
to consider and determine the Remuneration
10.2 Ensuring that on appointment to the Board, Non- Policy, based on the performance and also bearing
Executive Directors receive a formal letter of in mind that the remuneration is reasonable and
appointment in accordance with the Guidelines sufficient to attract retain and motivate members
provided under the Act; of the Board and such other factors as the
Committee shall deem appropriate all elements of
10.3 Determining the appropriate size, diversity and the remuneration of the members of the Board.
composition of the Board;
11.2 to approve the remuneration of the Directors, Key
10.4 Setting a formal and transparent procedure for Managerial Personnel and Senior Management
selecting new Directors for appointment to the of the Company maintaining a balance between
Board; fixed and incentive pay reflecting short and long
term performance objectives appropriate to the
10.5 Developing a succession plan for the Board and working of the Company.
Senior Management.
11.3 to delegate any of its powers to one or more of its
10.6 Evaluating the performance of the Board members members or the Secretary of the Committee.
and Senior Management in the context of the
Company’s performance from business and 11.4 to consider any other matters as may be requested
compliance perspective; by the Board.
10.7 Making recommendations to the Board concerning 11.5 Professional indemnity and liability insurance for
any matters relating to the continuation in office of Directors and senior management.
any Director at any time including the suspension
or termination of service of an Executive Director 12. MINUTES OF COMMITTEE MEETING
as an employee of the Company subject to the Proceedings of all meetings must be minuted and signed by
provision of the law and their service contract. the Chairman of the Committee at the subsequent meeting.
Minutes of the Committee meetings will be tabled at the
10.8 Delegating any of its powers to one or more of its subsequent Board and Committee meeting.
members or the Secretary of the Committee;
33
Annexure F
Form AOC – 2
(Pursuant to clause (h) of sub-section (3) of section 134 of the Act and Rule 8(2) of the
Companies (Accounts) Rules, 2014)
Form for disclosure of particulars of contracts/arrangements entered into by the company with related parties referred to in
sub-section (1) of section 188 of the Companies Act, 2013 including certain arms length transactions under third proviso
thereto:
1. Details of contracts or arrangements or transactions not at arm’s length basis
a. Name(s) of the related party and nature of relationship Nil

b. Nature of contracts/arrangements/transactions Nil
c. Duration of the contracts/arrangements/transactions Nil
d. Salient terms of the contracts or arrangements or transactions including the value, if any Nil
e. Justification for entering into such contracts or arrangements or transactions Nil
f. Date(s) of approval by the Board Nil
g. Amount paid as advances, if any Nil
h. Date on which the special resolution was passed in general meeting as required under Nil
first proviso to section188
2. Details of material contracts or arrangement or transactions at arm’s length basis
a. Name(s) of the related party and nature of relationship Meritor HVS (India) Limited
b. Nature of contracts/arrangements/ transactions Purchase of raw material, sale of finish goods,
availing technical service
c. Duration of the contracts/arrangements/ transactions On ongoing basis
d. Salient terms of the contracts or arrangements or transactions including Estimated annual transaction value of
the value, if any `30,000 million for a period of five (5) years
Starting from1st April, 2019
e. Date(s) of approval by the Board, if any 8th May, 2018 and approved by shareholders in the
Annual General Meeting held on August 13, 2018
f. Amount paid as advances, if any: Nil
34
Annexure G
CORPORATE SOCIAL RESPONSIBILITY
Information as per Section 135 of the Companies Act, 2013 & Companies (CSR Policy) Rules, 2014:
1. Corporate Social Responsibility Policy

Business Enterprises are the economic organ of the society and rely on societal resources. Automotive Axles Limited (AAL)
believes that a Company’s performance must be measured by its Triple Bottom Line contribution to building economic,
social and environmental capital towards enhancing the societal sustainability. The concept of sustainability, responsibility
and social welfare has intrinsically been woven into the corporate ethos of the organization.
CSR initiative has reinforced us as community conscious, socially responsible and value based organization, committed
to making the world a better place to live in. All our CSR activities concentrate towards the holistic development of the
individual and the society as whole.
The company’s CSR policy can be accessed at: www.autoaxle.com/Policy.aspx
2. Composition of the CSR Committee

The Board Committee of CSR comprises of:
(a) Mr. B. C. Prabhakar, Chairman (Independent Director)
(b) Dr. Shalini Sarin, Member (Independent Director)
(c) Mr. Kumaradevan Srinivasan, Member
3. Average net profit of the company for last three financial years: `1,287.61 million
4. Prescribed CSR Expenditure (Two percent of the amount as in Item 3 above): `25.75 million
5. Details of CSR spent during the financial year:
a) Total amount to be spent for the financial year: `25.75 million

b) Amount unspent, if any: `0.49 million
c) Manner in which the amount spent during the financial year is detailed below:
1 2 3 4 5 6 7 8
S.No CSR project or Sector in which Projects or Amount outlay Amount spent on Cumulative Amount spent
activity identified the project is programs at (budget) (INR in the projects (INR expenditure upto directly or through
covered million) in million) the reporting implementing
period in INR agency
million
*1 Swachh Bharat Environmental Mysuru, 1.04 1.04 1.04 Direct
*2 Abhiyaan Sanitation 8.22 8.22 8.22 Direct
3 Skill Promoting Mysuru, 0.71 0.71 0.71 Through Agency
Development enhancement of
Program vocation skills
4 Contribution Promoting Mysuru, 0.29 0.29 0.29 Direct
towards Mysuru culture
Dasara cultural
program
5 COVID-19 Contribution NA 15.00 15.00 15.00 Direct
pandemic towards PM
CARES Fund
Total 25.26
*Note
(1) Development of nearby park
(2) Lake Renovation
35
6. Reasons for a part of CSR amount unspent:

The Company is interested in the projects with respect to lakes renovation, putting up Public Convenience facilities
in tourists’ spots, skill development programs etc. in and around Mysuru Area where the Company can spend the
earmarked amount in a way which is more beneficial to the society but the amount could not be spent due to delay in
getting necessary approvals.
7. CSR Committee Responsibility Statement:

The CSR Committee confirms that the implementation and monitoring of the CSR activities of the Company are in
compliance with the CSR objectives and CSR Policy of the Company.
Srinivasan Kumaradevan B. C. Prabhakar

Sr.Vice President & Whole-time Director Chairman of the CSR Committee
Place : Mysuru Place : Bengaluru
Date : 26th May 2020 Date : 26th May 2020
36
Management Discussion and Analysis

Global economy the top three economic powers in the world over the next
The global economy came across several uncertainties 10-15 years, backed by its robust democracy and strong
during the year 2019. Rising tensions in world trade, partnerships.
delay in the Brexit deal, disruptions in the oil market and
an impending recession in some of the major economies However, during FY 2019-20, India’s economy grew
created a negative sentiment across the world. by just 4.2%, as compared to 6.8% in FY 2018-19. The
major factors behind this low growth rate being decline in
In calendar year (CY) 2019, the US economy grew by 2.3% domestic demand, slowdown in growth of rural income
and was one of the fastest growing nations among the and inefficiency in the operations of Non-Banking Financial
developed countries. The major reasons being increased Corporations (NBFCs). This further led to fall in export
manufacturing activity, employment generation and demand, lower capacity utilisation of industries and thereby
consumer spending. This growth in the US has also helped reduction in fresh investments.
in reducing the impact of slowed growth in the European
Union (EU) countries, thereby aiding in a stable growth To bring back the wheels of the economy in place, steps
in world output. In Britain, trading activities, government such as reduction in corporate tax rates, offering credit
consumption and private consumption contributed towards guarantee for financially sound NBFCs, slashing down of
a tepid growth of 1.4%. repo rate were taken up. These initiatives had gradually
started delivering results in the second half of FY 2019-20,
However, with the outbreak of COVID-19, things have when the outbreak of COVID-19 put up fresh challenges.
become more challenging. As governments across the world Various steps were undertaken to stop its outbreak, such
focus on containment of the disease, the measures adopted as nationwide restrictions and a complete lockdown, which
have led to shortage of labour supply and movement of impacted economic activity on a significant scale. The severe
goods. As production is curtailed around the world, many disruptive impact on demand caused by the pandemic has
firms will not have necessary inputs which is likely to create created large cash flow gaps for corporates.
a vicious cycle. The global impact of China’s slowdown is
already being felt around the world as the virus outbreak Understanding the requirement of the situation, the
has disrupted manufacturing supply chains and sharply Government of India has announced a relief package worth
curtailed energy as well as commodity demand. Rs 20 lakh crores, which is roughly 10% of the GDP of India.
This economic package has the objective of increasing
As a result of this economic fallout, the global economy growth and help the country accelerate towards achieving
is forecasted to sharply contract by -3% during CY 2020 the aim of building a self-reliant India.
which would be worse than the 2008-09 financial crisis.
However, the global economy is projected to grow by However, looking into the current scenario, IMF
5.8% in CY 2021 when economic activity normalises. has slashed down its expected growth rate for
(Source: World Economic Outlook, April 2020 by IMF) FY 2020-21 to 1.9% from the previously expected 5.6%,
but a major turnaround of 7.4% is expected in FY 2021-22.
Annual GDP growth rate (Source: World Economic Outlook, April 2020 by IMF)
Region 2019 2020 2021

World output 2.9 -3.0 5.8 Indian automobile and auto component
United States 2.3 -5.9 4.7 industry
Europe region 1.2 -7.5 4.7 Automobile industry
United Kingdom 1.4 -6.5 4.0 The Indian automobile and auto component industry
China 6.1 1.2 9.2 together contribute ~10% to the GDP, with automobile
India 4.2 1.9 7.4 contributing ~7.1% and the auto component industry
(Source: World Economic Outlook, April 2020 by IMF) contributing 2.3% to the GDP. Besides, the industry employs
close to 4 crores people.
Indian economy
India has emerged as the fastest growing major economy The auto industry went through one of the most challenging
in the world and is expected to be considered among years during FY 2019-20, with sales falling by double-digits
37
across all segments compared to FY 2018-19. Sales of international auto giants have in the Indian markets.
passenger vehicles and two-wheelers fell by 18% whereas
commercial vehicles numbers went down by 29%. Additionally, according to the Automotive Component
Manufacturers Association of India (ACMA), the Indian
The automobile industry was on a brink of revival after auto components industry is expected to register a turnover
a torrid FY 2019-20. The expectation was of a decent of US$100 billion by 2020 backed by strong exports
FY 2020-21, however, the COVID-19 led lockdown dealt a ranging between US$80–100 billion by 2026. Though,
decisive blow to the already bleeding automobile industry. with the current ongoing global pandemic, things seem to
In these conditions, rural economy can turn out to be a be uncertain but when the world economies stabilise, this
point of attraction. With forecasts of normal monsoons industry would be among the fastest growing ones.
and therefore healthy kharif and rabi crops, a boost in (Source: KPMG, Potential impact of Covid-19 on the Indian economy, Edelweiss
the rural economy is expected. This could potentially lead Professional Investor Research, IBEF)
to a rise in vehicle sales from the second half of the year.
(Source: KPMG, Potential impact of Covid-19 on the Indian economy, Edelweiss Tractors
Professional Investor Research, IBEF) Agriculture remains a focus area for the government, employing
significant portion of the domestic workforce. More importantly,
Auto component industry the health of this sector remains critical to meet food security
The key source countries for imports of auto and auto needs and hence the Government of India has been focusing
components include China, Germany, South Korea, Japan upon promoting mechanisation of farmlands (which translates
and Thailand, whereas key export markets include the to the use of tractors, along with implements).
US, Mexico, Bangladesh, Africa and Asia. Most of these
countries are under the ambit of COVID-19, which makes The agriculture tractor market in India is expected to grow at
matters worse for the industry, already facing weak demand. a CAGR of 6.7% during 2019-2024. Bolstered by a series
Moreover, production shutdown across the country due to the of policy incentives to support the agricultural machinery
pandemic will significantly impact the sector further. Besides, sector and subsidies for the purchase of farm machinery,
liquidity shortfall in the sector due to Non-Banking Financial the agricultural tractor industry in India witnessed rapid
Companies (NBFCs) and banking sector challenges are development in the past few years.
going to have an impact on sales.
Macro factors such as the overall level of economic
With China catering to ~25% of India’s automotive part development, migration of rural labour, land utilisation,
imports, disruption in supply of raw materials and other critical agricultural production, food demand, agricultural
components have affected imports and led to fluctuations in machinery industry, trade, manufacturing capacity and
prices of raw materials. It is also expected that availability of testing have created a favourable market scenario for the
contract labour for operations and support functions might agriculture tractor market in India. Besides, both central
become an issue for a major part of FY 2020-21. and local governments allocate funds to subsidise farmers’
purchase of agricultural machinery, which is already giving
However, if we analyse the auto component industry, before and is expected to further push the tractor industry.
the COVID-19 impact, it seemed quite promising. Having
expanded by 10.6%, the Indian auto-components industry But at the same time, it is important to note that the impact
has been experiencing healthy growth over the last few of COVID-19 will have a widespread impact and would
years. It reached a level of US$56.2 billion in FY 2018-19 indirectly affect this industry as well. However, India being
and employed ~1.5 million people directly and the same an agrarian economy, it is going to be impacted a lot lesser
number of individuals indirectly. than the manufacturing and service industries.
(Source: Business wire, Jan 2020)
According to data by the Department for Promotion of
Industry and Internal Trade (DPIIT), the Foreign Direct Outlook
Investment (FDI) inflows into the Indian automotive industry The automobile segment is significantly impacted by
during the period April 2000–December 2019 stood at economic sentiments and consumer purchasing power. As
US$23.89 billion, which reflects the confidence that various a result, we expect that the demand for passenger vehicles
38
(including two/four-wheelers) as well as commercial vehicles enabled us to grow our presence in both domestic and
would remain low. Liquidity and cash crunch have already international markets, as we serve the manufacturers of
put a dent in sales to fleet operators and with the breakout trucks and buses in segments like light, medium and heavy
of COVID-19, the demand for commercial vehicles is commercial vehicles; military and off-highway vehicles; and
expected to further decline in the coming months. aftermarket.
Auto original equipment manufacturers (OEMs) would have Our product suite includes front steer axles, defence axles,
to delay any new launches by at least a few quarters or till off-highway axles, non-drive axles, drum brake, disc brake,
the sentiments get better. However, Indian auto components gearing, integral brake to axle design, weight option designs
industry can emerge in medium to long term as an alternative and driver operated differential locks.
source of supply if the industry receives support by policy
framework in the months, going forward. We have four manufacturing units spread across India—
Rudrapur (Uttarakhand), Mysuru (Karnataka), Jamshedpur
Concurrently, it is to be considered that humanity has always (Jamshedpur) and Hosur (Tamil Nadu)—where we reinforce
emerged stronger after facing every new challenge and our world-class manufacturing standards by underpinning
adversity and the same would happen regarding COVID-19. the concept of built-in quality. Besides, Bangalore Technical
Therefore, the fact that the world is globalising rapidly would Centre (BTC) serves as our technology partner in product
also open newer avenues for the transportation industry, engineering, product benchmarking, prototyping, validation
especially shifts towards electric, electronic and hybrid cars. and testing, and aftermarket engineering.
This would also lead to newer verticals and opportunities
for auto-component manufacturers, who are continuously We are listed on both National Stock Exchange and Bombay
innovating through systematic research and development. Stock Exchange.
Indian auto-component makers are well positioned to benefit Our story in numbers
from globalisation in medium to long term as exports have
the potential to increase by ~US$30 billion by CY 2021 38+ Drive Axles
Front Steer Axles ~1,700
and subsequently making the Indian auto-components
industry the third largest in the world by CY 2025.
years Off-highway Axles
Non-Drive Axles
Drum & Disc Brake
Simultaneously, the availability of skilled labour at low cost, Suspension
robust R&D centres and cost-efficient steel production in India
shows a promising future for India’s automobile industry. These Experience Product categories Team size
factors are also expected to provide great opportunities for (Approximately)
investment, along with direct and indirect employment to both
skilled and unskilled labour. So, on an overall basis, Indian Four Ashok Leyland
Daimler India
(INR in crores)
Total Income:
automotive industry (including component manufacturing) is Mahindra & Rs. 959.68
expected to reach ~ US$250 billion by 2026. Mahindra Profit after tax:
(Source: KPMG, Potential impact of Covid-19 on the Indian economy, IBEF) Tata Motors Rs. 41.13
Earnings per share:
Volvo Eicher
AAL: Progressing technology and teamwork INR 27.22
Volvo Thailand
Automotive Axle Limited (AAL) is a joint venture between (INR in rupees)
Kalyani Group and Meritor Inc., USA, incorporated in Production Major Customers Financial
1981. We are India’s largest independent manufacturer of units Performance for
Rear Drive Axle Assemblies and fabricate S-Cam actuated the year
quick-change air brakes and trailer axles for 10 tonnes to
13 tonnes gross vehicle weight (GVW).
We revere the principle of ‘Don’t Accept. Don’t Produce.

Don’t Release.’ defective products. This approach has
39
Vision 5S certification through QCFI-JUSE

To be a world-class quality manufacturer of axles, providing Quality Management System certified with IATF
innovative solutions to customers at competitive price that 16949:2016
enhance mobility, safety and environment and retain leadership. Heat Treatment Process certified with CQI 9
Welding processes certified with CQI 15
In the pursuit of excellence
Our focus has always been on delivering the best quality of Awards and recognitions
products. Our business enablers include the following: Recognised for our support at all times and awarded
us with the ‘BEST SUPPORT FOR VEHICLE OFF ROAD
Business acumen: Our market insights and (VOR)’ in September 2019 by TATA Motors
understanding of client requirements are a result of our Appreciated and rewarded with Gold Award for
38+ years of experience. With a focus on innovation and Business Alignment by Ashok Leyland
cost-effective products, we ensure our clients can rely on Received recognition from VOLVO towards ‘Specialty
our offerings. Vehicle Build & Support’ in November 2019
Upgraded from B to A in VECV ‘KATA’ initiative in
Competitive edge: Our skilled workforce and technical October 2019
expertise enables us to deliver bespoke products and Got certified by Union of Japanese Scientists &
services to our customers. We also enjoy technology Engineers (JUSE) through Quality Circle Forum of India
leadership owing to our joint venture with Meritor Heavy (QCFI) for Implementing best 5S practices, which was
Vehicle Systems LLC, USA. re-certified by QCFI in December 2019
Bagged seven Gold Awards and three Silver Awards
Quality-focused: At AAL, we strive to strengthen our during Chapter Convention on Quality Concept
quality standards regularly by incorporating internationally (CCQC-2019) in May 2019
acclaimed techniques like Gemba, 5S and Six Sigma Won distinguish award for Allied Case Study
processes. Besides, we have inculcated the policy of ‘no Presentation and Excellence Award for Kaizen Model
acceptance, production or release of defective products’ Presentation during National Convention on Allied
among our teams. Concepts at Varanasi in December 2019
Bagged third place in district-level Safety Quiz & Safety
Extensive offerings: Our wide-ranging product suite Skit competition organised by Deputy Director of
caters to various Original Equipment Manufacturers (OEMs) Factories & Boilers department, Karnataka
with reliable and highly efficient products.
Operational highlights
Our customer base At AAL, we utilise sophisticated and contemporary
Ashok Leyland equipment to deliver our world-class offerings. During the
Daimler India year, we inaugurated a new state-of-the-art axle assembly
Mahindra & Mahindra and painting line to enhance our capacity. The plant also
Tata Motors has avant-garde pre-treatment and robotic painting line
Volvo Eicher with 2K paint. We have begun production in the new unit
Volvo Thailand and delivered goods produced in it. We also introduced IoT
(Internet of Things platform)-enabled processes in line with
At AAL, we enjoy an extensive client list across India and Industry 4.0 digitalisation by incorporating digital mistake
are steadily growing our presence in the markets of China, proofing, paperless factory with all digital displays and
USA, France, Italy, Brazil and others. automatic data capturing. Additionally, we are installing a
drive head assembly line with latest equipment to cater to
Certifications new-age requirements.
Environmental Management System certified with ISO
14001:2015 We use advanced gear manufacturing equipment, with
Occupational Health and Safety Management System modern continuous carburising and sealed quench furnaces
certified with BS OHSAS 18001:2007 for heat treatment process. We also installed four new face
40
hob design equipment with spiron cutters and closed loop This year we also began a journey to implement Total
cutter setting with blade profile grinding facilities to enhance Productive Maintenance (TPM) to adapt best processes and
capacity. These improvements have enabled us to meet the world-class manufacturing systems.
enhanced requirement of BS-VI emission norms.
FINANCIAL PERFORMANCE
(` in million)
Key highlights FY 2019-20 FY 2018-19 FY 2017-18 FY 2016-17 FY 2015-16
Total Income 9596.81 19420.02 15580.63 13039.92 10875.44
Profit before Depreciation & Tax 971.76 2314.97 1710.30 1143.77 909.66
Profit After Tax 411.34 1215.50 839.32 494.18 347.74
Earnings Per Share (Rs.) 27.22 80.43 55.54 32.70 23.01
* Note: Figures are based on the applicability of Indian Accounting Standards
If there is change of 25% or more as compared to the immediately

Key financial ratios 2019-20 2018-19
previous financial year detail with explanation
Debtors Turnover 7.76 5.60 Debtors receivables have been high as on 31st March 2020 due to
collection backlog during the end of the year due to slowdown in
the Automobile Industry and COVID-19
Inventory Turnover 4.14 7.29 Due to the slowdown in Automobile Industry during the year 2019-
20, Management has taken aggressive inventory reduction and
liquidation plans
Interest Coverage Ratio 18.39 98.97 Interest cost is insignificant when compared to the business volumes
and has no material impact on the reported numbers
Current Ratio 2.59 2.00 Increase in the current ratio is mainly due to a higher Debtors
turnover ratio caused by reduction in the debtors collection due to
- market slowdown during the year and
- COVID-19 towards the end of the financial year
Debt Equity Ratio 0.04 0.14 Significant portion of long-term debts have been repaid during the
year
Operating Profit Margin (%) 22.7% 20.7%
Net Profit Margin (%) 4.2% 6.1%
Return on Capital employed 0.11 0.30 Slowdown in Automobile Industry during the year 2019-20 has
resulted in severe strain on the Sales and the profitability
Return on Net Worth 0.08 0.22 Slowdown in Automobile Industry during the year 2019-20 has
resulted in severe strain on the Sales and the profitability
Business outlook 2020-21

We expected a decent performance for FY 2020-21, but components. Our world-class offerings are a result of our
the pandemic is set to impact our business brutally during technology expertise, skilled workforce and focus on quality
the first half of the year and to a limited extent thereafter.
However, we look forward to growth in the coming years. Technology
We use contemporary technology to provide our customers
BS-VI products that are dependable and enduring. Our
We have supported all our customers with necessary BS-VI operations include:
products aiding them with a smooth transition to the new
emission norms. Friction welding
Argon CO2 welding
Strategy in action Robotic welding
We are among India’s top manufacturers of specialised auto CNC machining
41
Gear and pinion dry cutting We launched our TPM excellence/Total Quality Management
Robotic gear quenching (TQM) implementation initiative company-wide to become a
Specialty axles manufacturing unit benchmark organisation and to use operational excellence
Robotic brake web hot forming as a key differentiator in the marketplace.
Robotic welding of housing halves
Automated inside welding machines for housing Human resource
manufacturing A company’s growth is the result of its team’s ability to
Special purpose multi-spindle high productive machines collectively leverage its capabilities. At AAL, we onboard
Flexible machining centres and specially built machines talent and nurture them, using training and other knowledge-
for producing axles and brakes enhancing and skill upgradation methodology to upskill
Metallurgy, chemical and metrology lab with CMM them. We also have a robust rewards and recognitions
New assembly line with robotic painting line programme at AAL which helps motivate our dynamic and
determined team
During the year, we adopted the following technologies and
equipment:
Culture at AAL
New assembly shop with robotic painting: This new We have built a diverse culture that we defend at every step.
assembly line is Industry v4.0 enabled and offers world-class We respect our team members and treat all our employees with
manufacturing of axles with process and product traceability, respect. With a merit-based and inclusive culture at the heart of
AAL, we drive various programmes towards:
real-time data acquisition enabling monitoring of process
and operations dynamically and data-based decision-
Treating employees with respect/dignity
making. The line is equipped with automated paint kitchen
Motivating workforce to deliver quality output
and robotic painting process, which is a global benchmark.
Encouraging a sense of belongingness
Promoting the culture of innovation and participation
Housing line equipment: Housing line capacity was
enhanced by improving existing processes and infusing high We offer our people transfers, promotions and job rotations (inter
technology processes like robotic welding cells and multi- and intra department/business unit) that helps in employee retention.
machining machines. At AAL, we encourage clear and transparent communication and
utilise quarterly and monthly Town hall gatherings, quality and
Gear manufacturing equipment: Gear Set capacity customer feedback meetings, one-on-one discussions with key
improves by adding cutting-edge close-loop machines, which employees and group meetings for the purpose.
facilitate the production of benchmarked-quality offerings.
Quality management Acquiring talent & People management

We are strengthening our production quality by embracing We are building our bench strength with talent identification
contemporary production techniques. The adoption of and succession process (TI & SP) and capability development
Quality Management System (QMS) and Lean Management programmes. TI & SP ascertains successors for leadership
System (LMS) have helped us reinforce our Built-In Quality roles, helps develop talent across the organisation and
(BIQ) concept and ZERO COC (coolant, oil and chip). The determines career development opportunities for our people.
Automotive Axles Production System (APS) has enabled us The TI & SP talent are reviewed by the top management.
to synchronise our operations. We have also implemented It ensures growth, stretch assignments and provides
Gemba, Six Sigma and 5S principles to enhance our development opportunities for potential management staff.
production processes.
We recruit Graduate Engineer Trainees (GETs) every year.
We have robust monitoring systems such as IATF During FY 2019-20, we hired 24 GETs from different parts
16949: 2016, CQI9 (heat treatment process), CQI15 of India, of which 50% are women. This initiative reflects
(welding process standards) and OHSAS (environmental our commitment to diversity and inclusion and inculcates
occupational, health & safety management). the culture of inclusion in the organisation.
42
It is an initiative that creates higher visibility of AAL’s writing, and others. We appreciated the participation of our
commitment to Diversity and Inclusion among its people people and their families in the prize distribution ceremony
and inculcates the culture of inclusion. By doing this, we that was celebrated with Kannada Rajyotsava on 1st
are realigning business and people practices to build an November 2019.
inclusive and nurturing work environment for all employees.
Employee Development Program
With a specialised learning centre for induction, on-the- Additionally, our Employee Development Program allows
job-training (OJT) and special trainings for the operators, our teams exposure to contemporary management concepts
we provide trainings on wielding, CNC machine operation, and techniques, simultaneously focusing on education
material handling and tools identification. The learning and development of high-potential talent and leadership.
centre is fully equipped and uses contemporary training Our Human Resource Management System (HRMS)
procedures. We also hire trainers for our neuro-linguistic implementation through Darwin allows AAL employees to
training programme (NLP). easily manage respective HR policies/processes through
web-based automated system, streamlining administrative
Percentage of training and learning processes and leveraging tasks leading to improved HR
programmes productivity and efficiency.
Type of training and learning
Percentage
programme
70%
We have launched following modules during the year
Technical programmes
20% as Employee Self Service and all modules have been
Behavioural programmes
10% implemented and are working successfully:
Common programmes
Employee Information Management

5S Workplace Management Leave Management
The 5S workplace management system allows us to maintain Performance Management
better controls on our processes and operations. Communication on HR Policies
MIS Reports
Employee engagement
We promote the ‘One AAL’ concept across all our locations Safety and emergency preparedness
to build team spirit, a collaborative approach and training
camaraderie. We have employee satisfaction surveys to The Hazard Identification and Risk Assessment (HIRA)
enhance employee engagement in the organisation. processes defend our operations and help in cutting down
risk factors in our units, lowering the number of accidents
We undertake several initiatives like family day, sports day, and near-miss cases. We have an on-site emergency plan
festival celebrations, summer camps, annual sports and prepared and approved from the Department of Factories
cultural activities. We inspire our people to participate in and Boilers Office, Karnataka.
external events such as inter-company best safety worker
competition, cricket tournaments and so on. Besides, We reinforce the safety of our people through various
we organise different programmes like essay and slogan safety training programmes, periodically organising safety
writing for special occasions like National Safety Day, World audits that address potential hazards and abnormalities
Environment Day and International Women’s Day, among immediately. Our well-trained emergency team is readily
others. available 24x7 to attend any emergencies at our worksites.
We also conduct mock drills to prepare on-site emergency
Our employee engagement activities are organised during routines.
non-shift hours between the months of August and October.
During FY 2019-20, over 1,000 teammates, along with Occupational Health Centre (OHC)
their spouse and children participated in different sports Qualified doctors, paramedical staff and emergency
and cultural activities such as athletics, singing, yoga, essay medical equipment are available in our OHC to deal with
43
industry-specific health and safety issues among our people.

Advanced/new technology fire extinguisher provided in
Besides, the doctors undertake monthly health programmes shop floor as part of fire prevention and mitigation measure
for all employees to educate them on employment-related
health hazards and work-life balance. We also invite Introduced and practiced Rapid Upper Limb Assessment
renowned specialists to speak at these events. (RULA)/Rapid Entire Body Assessment (REBA), a
scientific tool related to ergonomics to study employee
Policy for women employees postures at workplace; this will enable us to suitably
AAL is an equal opportunities organisation and we believe modify and improve Work Space Organisation (WSO)
in creating a level playing field for all our employees to reduce operator fatigue
irrespective of their caste, creed, gender or background.
We have stringent policies in place to address issues Installed CO2 auto-flooding system in new NX assembly
pertaining to women at our organisation. Our objective is robot painting chamber and paint kitchen under Fire
to ensure that we provide a safe environment for all our Mitigation and Prevention programme,
colleagues, including women. To achieve this purpose, we
run regular dialogue between our women employees and Provided auto-sprinkling system with heat sensor quartz
the management. bulb type fire hydrant system for new NX paint booth
The International Women’s Day 2020 was celebrated on Installed multi-purpose nozzles for firefighting, under
9th March 2020 by inviting a renowned psychiatrist from fire-fighting infrastructure development
Apollo Hospital who enlightened the women employees on
handling stress at work and home. Post the session, we had Conducted Major Accident Hazard (MAH) unit total
a short quiz stint where women were encouraged to reflect plant safety audit by external competent agency
upon the session and received spot awards on giving right according to applicable safety regulatory guidelines,
answers.

Completed migrating process from OHSAS
Safety, health and environment 18001:2007 to new ISO 45001:2018
We strive towards better management of our sustainability
drivers, including safety, health and environment of our rganised hydrostatic, non-destructive ultrasonic test
O
assets. For us, the health and safety of our communities on our half-mounded LPG storage bullets by Petroleum
is equally important as that of our people. Therefore, we and Explosive Safety Organisation (PESO) authorised
undertake community initiatives around various causes for agency according to statutory requirements
the communities around us.

Incorporated Lock-Out & Tag-Out (LOTO) stations
We have the following safety, health and environment provision across the plant for major electrical
initiatives: maintenance work
Safety
Received approval from FM Global for Research

Conducting compulsory safety induction training and & Testing for Property Loss Prevention Services for
refresher safety workshop/sessions for all employees to ensure chemical cabinet’s provision that includes paint booths
preparedness towards any accident/incident prevention for safe storage of paint and thinner
Introduced oil/chemical cotton based reusable sorbent for Installed CO2 auto-flooding system with heat sensor
oil and coolant accidental spillage/leakage by eliminating for shop peening and brake shoe liner grinding
usage of saw dust (potential fire hazard elimination) machine exhaust system have been to mitigate/prevent
fire incidents

Organised external and internal certification safety
training programmes in association with government Defined and displayed safety protocol in all entry and
agencies and competent institutions exit gates of factory premises
44
Fixed electric chain hoists cross beams and longitudinal

Conducting periodical on-site emergency plan and
beams secondary safety wire rope for all material preparedness mock drills and fire drills involving all
handling equipment under the Safety Incident emergency response teams
Prevention Program
Health
Conducting a customised workshop—Behaviour Based
Conducted ergonomics-focused health training with
Safety—to create ‘Safety First Priority’ among all levels exercises for employees, including Acupuncture for
of employees pain and physiotherapy
Displayed ‘Sensitive to Safety’ visuals on all machines Organised first aid training for our people in association
to sensitise against hazards associated with any specific with by St. Johns Ambulance Group
process or operation
Celebrated World Health Day by conducting ‘basic life
Department-wise monthly communication to emphasise support training’ for all employees
safety across the plant,
Arranged periodic inspections by in-house doctors to

Observing National Safety Day—like every year–to identify health hazards at workplace
promote and propagate ‘Safety First’ culture, during
March wherein we organise various competitions, Conducted Health Talk (about different organs of the
including Walkathons, and display safety information body) on monthly basis through interactive sessions
and play videos on the importance of safety with renowned doctors in the city

Extended the Central Fire Hydrant System, now
Organised trainings on team building, stress-free
creating additional 12 outlets taking the total count to working, potential enhancement of efficiency at
23 for fire mitigation workplace

Revised ‘Permit to Work’ system with enhanced
Arranged pre-recruitment medical check-up for all
responsibility and accountability to strengthen vigilance recruits and annual check-up for all regular employees
on hazardous activities and trainees

Improved safety at source with hazard mitigation
Equipped our Occupational Health Centre with all
initiative by respective Line Head of Departments modern machines like ECG machine, automated
(HODs) and Line Supervisors on 4M analysis (Man, external defibrillator machine nebuliser for treating
Machine, Method & Material) for Environment, acute asthma cases
Occupational Health and Safety area co-ordinators
to identify unsafe conditions/acts under the accident Environment
prevention programme Undertook the following programmes under Natural
Resource Conservation Initiative:

Ensuring periodical safety testing and certification
of all Material Handling Mechanical Equipment by - Robotic painting process introduced to optimise
authorised external competent person the paint consumption
Recognised and rewarded best safe employee value - Oil & Coolant Recovery plant is being used for
streamwise. filtration and reuse of used oil and coolant
Observed Chemical Disaster and Prevention Day to Promoting the 5S culture at workplace and motivated
create awareness among all employees on safety in people to incorporate it at home as well
chemical management
45
Commenced the following programmes under the Go Sustained ISO 14001:2015, Environment Management
Green initiatives: System certification after audit by M/s DQS, India
-
Eliminated wood packaging and introduced Installed additional filter press to reduce the STP sludge
returnable metal-based pallets and metal generation.
separators
Precautions taken during COVID-19
- Diminished of paper consumption by embracing situation
digitalisation through KIOSK and LED Shift In- As the challenges around COVID-19 continue to evolve, we
charge display screens installed at shop entrance are carefully considering the best course of action to ensure
the wellbeing of our people and our business.
- Nearby public park developed by planting 200
saplings We are glad to announce that none of our employees have
tested positive for COVID-19 till date. We also continue
Initiated theme-based water conservation audits and to encourage them to strictly adhere to safety guidelines
projects to reduce freshwater consumption towards through periodic communications.
water positive journey
Currently, we are operating as per the government guidelines
Provided polycarbonate sheets on the roof of our NX and implementing rigorous screening at our units. We are
plant to get sunlight under the Power Conservation ensuring 100% thermal screening at all factory entrance
Initiative gates, besides ensuring hand sanitisers and other critical
gear are available at all the important areas across all
Introduced High Velocity Low Speed (HVLS), ventilator our factories. We have made wearing masks a compulsory
fans in the NX plant shop, resulting in 33% power measure at AAL, with all security, canteen and housekeeping
saving staff issued the best quality products available.
Replaced induction motor with energy-efficient motors We are consistently communicating the measures we are
and Variable Frequency Drive (VFD) for significant undertaking to avoid COVID-19 breakout to our people.
energy use (7.5 HP and above) We have also suspended all training initiatives for our
tech-team, apart from those that can be imparted online.

Reduced hazardous waste generation by adopting Additionally, we have minimised external visitors in our
recycle and recovery system in new NX paint booth premises and allow it only in case of emergencies. External
visitors are only allowed to enter our premises after obtaining
Used Fish Test methodology to test the quality of STP- permission of the Plant Operations Head and after all
and ETP-treated water to prevent environment pollution necessary precautions.

Started eFactory Development Initiative with Further we are complying with all statutory requirements on
digitalization of manufacturing operations by Covid-19 compliances and followed all required guidelines
Industry–4.0 complied, IoT platform of central & state Government
Distributed eco-friendly Ganesha idols to all employees Risk management

on Ganesha Chaturthi celebration to prevent water We acknowledge the criticality of a strong risk management
pollution and land contamination architecture to achieve our strategic objectives and
sustainable development. We underline our risk

Celebrated World Environment Day on 5th June management framework to mitigate/minimise all inherent
2019 by planting 1,000+ saplings in and around our and operational risks.
premises
46
Risk What it means Mitigation Technology The failure to Monitor emerging

risk innovate and trends in automotive
Industry risk A general slowdown Regular review of
develop new worldwide
in the automobile market conditions
technologies or Continuous
markets where our Resilient business products, or to improvement
customers are based model adapt to changing investment in New
has the potential to Long-term contracts customer behaviour Product technology
influence our sales enable us to tide over could lead to our
short-term slack in the business being
markets adversely impacted
Introduction of value- People risk The inability to Focus on key talent
based products to our attract, recruit, and their retention.
customers retain and motivate Pay by performance
Improving the share a highly skilled culture
of business through workforce could Strong value-led
quality, delivery and result in the loss of culture throughout
cost performance. key talent recruitment, induction
and training
Cost The growing cost of Develop cost-efficient Employee
inflation risk key raw materials manufacturing engagement activities
may impact processes and incentive plans
revenues and net Consistent efforts to
profitability of the reduce costs Internal Control Systems
organisation We have a robust internal control system that ensures to keep
a track of our assets. The system corresponds to the size of our
organisation and overviews operations. We conduct regular
internal audits to comb out any discrepancies. We further employ
PricewaterhouseCoopers Services LLP to conduct internal audit.
This ensures autonomy of the auditing body. We also ensure to
implement the auditor’s recommendations immediately.
47
Report on Corporate Governance

Our Corporate Governance Philosophy BOARD OF DIRECTORS
Corporate governance practices reflects our value system Size and Composition of the Board
encompassing our culture, policies and relationship with Your Company recognizes and embraces the importance of
our stakeholders. We at Automotive Axles Limited believe diversity of board for its success. Your Company believes
at maintaining a corporate governance system which is that a truly diverse board will leverage difference in thought,
transparent, best in board practices and ensure highest perspective, knowledge and skill, regional and industry
standards of conduct towards all stakeholders. experience, cultural and geographical background that
will help the Company retain its competitive advantage.
Automotive Axles Limited ensures to disclose timely and Accordingly, your board has the appropriate mix of executive
accurate information regarding its financial position, and independent directors to maintain its independence and
performance and other vital information including the separate its functions of governance and management. On
leadership and governance of the Company. Your Company 31st March, 2020, Board comprised of seven (7) Directors.
believes that an active, well informed and independent
board is necessary to ensure the highest standards of The Board consists of one (1) Executive Director and six (6)
corporate governance. Non-executive Directors, four (4) of whom are independent.
This composition comprises of one woman director as well.
Automotive Axles Limited believes the ‘Board of Directors’ The Board periodically evaluates the need for change in its
(the ‘Board’) is the core of the corporate governance composition and size
practice, which oversees the management’s functions and
protects the long term interest of its stakeholders. As on 31st Directors’ Attendance Record and Directorships:
March, 2020 the Board consists of seven members of which The name and categories of the Directors on the Board,
four are Independent Directors. their attendance at the Board Meetings held during the year
2019-20, the attendance at last Annual General Meeting
At Automotive Axles Limited we have adopted practices as held on Wednesday, August 14, 2019 and the number of
mandated in Securities and Exchange Board of India (Listing Directorships and Committee Chairmanships/Memberships
Obligations and Disclosure Requirements) Regulations, 2015 held by them in other Indian Companies as on 31st March,
with the Stock Exchanges and have established procedures 2020 are given herein below:
and systems to be fully compliant with the Regulations.
Composition of the Board, category and particulars of attendance is given below:

Nos. of Directorships and Committee
No. of Board
Attendance Memberships in Indian companies*
Director Category meetings
in last AGM Committee Committee
attended out of 4 Directorships
Memberships Chairmanships
Dr. B.N. Kalyani Promoter, Non-Executive 4 Yes 9 3 Nil
Mr. Chrishan Anton Sebastian Promoter, Non-Executive 1 No 2 Nil Nil
Villavarayan
Mr. B.B. Hattarki Independent 4 Yes 13 4 5
Mr. B.C. Prabhakar Independent 3 Yes 3 2 2
Mr. Rakesh Kalra Independent 3 Yes 6 5 Nil
Dr. Shalini Sarin Independent 4 Yes 6 2 Nil
Mr. Srinivasan Kumaradevan Executive 3 Yes 1 1 Nil
(Appointed w.e.f. 14.08.2019)
Dr. N Muthukumar Executive 2 Yes 1 1 Nil
(Resigned w.e.f. 14.08.2019)
Notes:
(a) There are no inter-se relationship between our Board members.
(b) * Directorships includes directorship in Private Companies but do not include companies incorporated outside India. In accordance with Regulation 26 of Securities and
Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, Memberships/Chairmanships of only the Audit Committee and Stakeholders
Relationship Committee in all public limited companies (including Automotive Axles Limited) have been considered.
(c) Leave of absence was granted to the Director(s) for the Board Meeting(s), which they did not attend and sought the leave of absence from the meeting.
48
Availability of information to the Board Quarterly details of foreign exchange exposure and the
Members steps taken by management to limit the risks of adverse
The Board has unrestricted access to all the Company related exchange rate movement;
information necessary for decision making. Detailed notes,
as necessary, are presented well in advance of the meeting Any material default in financial obligations to and by
along with the agenda. The following is the list of some of the company or substantial non-payment for goods sold
the information provided regularly to the Board of Directors: by the company
Annual Operating Plan and budgets, capital budgets Making of loans and investments, if any.
and updates
Compliance Certificate with respect to all the laws as
Quarterly results of the Company and its Operating applicable to the Company
Divisions
Constitution/reconstitution of Board Committees
Minutes of meetings of Audit and other Committees of
the Board
CSR activities carried out by the Company and
expenditure made thereon
General notice of interests of Directors
Role of Board of Directors

Declaration of Independent Directors at the time of The primary role of the Board is that of trusteeship to protect
appointment/annual declaration and enhance shareholder value through strategic direction
to the Company. As trustees, the Board has the fiduciary
Dividend data relationship to ensure that the Company has clear goals
aligned to shareholder value and its growth. The Board

Information on recruitment and remuneration of exercises its duties with care, skill, diligence and exercises
senior officers just below the board level, including independent judgement. The Board sets strategic goals and
appointment or removal of Chief Financial Officer and seeks accountability for their fulfillment. The Board also
the Company Secretary directs and exercise appropriate control to ensure that the
Company is managed in a manner that fulfils stakeholder’s

Materially important issues, disputes with the aspirations and societal expectations.
Government Authorities on show cause notices,
demands, prosecutions and penalty notices Board Membership Criteria
The Nomination and the Remuneration Committee works with

Fatal or serious accidents, dangerous occurrences, the entire Board to determine the appropriate characteristics,
effluent or pollution problems skills and required experience for the Board as a whole and
for individual members. Members are expected to possess
Any material default in financial obligations to and by the required qualification, integrity, expertise and experience
the Company for the position. They should also possess deep expertise and
insight in sectors/areas relevant to the Company and ability
Any issue that involves possible public or product liability to contribute to the Company’s growth.
claims of a substantial nature.
The Board members are expected to rigorously prepare to

Significant development in human resources and attend and participate in all Board and applicable committee
industrial relations front. meetings. Each member is expected to ensure that their other
current and planned future commitments do not materially
Sale of assets of material nature, not in normal course interfere with the responsibilities with the Company.
of business
Selection of New Director
Quarterly update on Risk Management System The Board is responsible for the selection for new Directors.
49
The Nomination and the Remuneration Committee makes A separate Independent Directors meeting was conducted
recommendation to the Board on induction of new member during the year.
after screening and the selection process, which is based on
the nomination and remuneration policy of the Company Board Meetings
In FY 2019-20 (Apr’19-Mar’20), the Board met four (4)
Training of Board Members times on 13th May 2019, 14th August 2019, 4th November
All new Directors inducted to the Board are introduced to 2019 and 14th February 2020. The maximum gap between
Company’s culture, its operations, customers, practices, any two Board Meetings was less than one hundred and
organisational structure, role and responsibilities, services, twenty (120) days.
board procedures, matters reserved for the board, risk and
the compliance details and such other details to familiarise
the new Director about the Company.
Attendance at Board meeting of the Directors during the FY 2019-20

No. of meetings conducted and attended during the year
Total Total No. of % of
Name of the Director
13 May 19
th
14th Aug 19 4th Nov 19 14th Feb 20 Attendance Meetings attendance
Dr. B N Kalyani 4 4 100

Mr. Chrishan Anton Con Call Con Call Con Call 1 4 25
Sebastian Villavarayan
Mr. B B Hattarki 4 4 100
Mr. B C Prabhakar LOA 3 4 75
Mr. Rakesh Kalra LOA 3 4 75
Dr. Shalini Sarin 4 4 100
Dr. N Muthukumar N.A. N.A. 2 2 100
(Resigned w.e.f. 14.08.2019)
Mr. Srinivasan Kumaradevan N.A. 3 3 100
(Appointed w.e.f.14.08.2019)
Code of Conduct The code lays down guidelines, procedures to be followed

In compliance with the Companies Act, 2013 and Securities and disclosure to be made while dealing with the shares
and Exchange Board of India (Listing Obligations and of the Company and cautioning them on consequences of
Disclosure Requirements) Regulations, 2015 the Company non-compliances.
has framed and adopted Code of Conduct (the Code).
This is applicable to all Directors, Independent Directors The copy of the policy is available on Company’s website
and Senior Management of the Company. The Code www.autoaxle.com/Policy.aspx
gives guidance and support needed for ethical conduct of
business and compliance of law. All members of the Board BOARD COMMITTEES
and Senior Management personnel have affirmed the As on 31st March, 2020, the Company has five committees
compliance with the Code as on 31st March, 2020. namely Audit Committee, Stakeholders Relationship
Committee, Nomination and Remuneration Committee,
The Code is available on Company’s website www.autoaxle. Corporate Social Responsibility Committee and Risk
com/Conduct_code.aspx. Management Committee. The Board Committees are set
up under the formal approval of the Board to carry out
Prevention of Insider Trading respective roles which are considered to be performed
The Board has formulated a policy on Trading of shares by by the members of the respective Board Committees.
an insider and code of conduct for regulating, monitoring The Company’s guidelines relating to Board Meetings
and reporting of trading of shares by insider. are applicable to Committee Meetings, as far as may be
50
practicable. Each Committee has the authority to engage proceedings of the Committee Meetings are placed before
outside experts, advisors and counsels to the extent it the Board meeting for perusal and noting. The Company
considers appropriate to assist in its work. Minutes of the Secretary acts as the secretary of all Committees.
Board and Committee composition as on 31st March, 2020
Risk Stakeholders Corporate Social Nomination &

SI. Audit
Directors Board Management Relationship Responsibility Remuneration
No Committee
Committee Committee Committee Committee
1 Dr. B N Kalyani
2 Mr. Chrishan Anton Sebastian
Villavarayan
3 Mr. B B Hattarki Chairman
4 Mr. B C Prabhakar Member Chairman Chairman Chairman Chairman
5 Mr. Rakesh Kalra Member Member Member
6 Dr. Shalini Sarin Member Member
7 Dr. N Muthukumar Member Member Member
(Resigned w.e.f. 14.08.2019)
8 Mr. Srinivasan Kumaradevan Member Member Member
AUDIT COMMITTEE
The Audit Committee of your Board consists of The committee met four (4) times during the year on 13th
three Independent Directors: May 2019, 13th August 2019, 4th November 2019 and
Mr. B B Hattarki, Chairman 10th February 2020
Mr. B C Prabhakar, Member
Mr. Rakesh Kalra, Members The meetings of the Audit Committee are also attended by
the Executive Director, Chief Financial Officer, Company
During the year, there was no change in the members of Secretary, Statutory Auditors, Internal Auditors and other
the Audit Committee. All members of the Committee are Management representatives as special invitees.
financial literates and possess required expertise.
Attendance record of Audit Committee members for 2019-20
Audit Committee Meeting held during the year 2019-20
Total Total No. of % of
Name of the Director Status
13th May 19 13th Aug 19 4th Nov 19 10th Feb 20 Attendance Meetings attendance
Mr. B B Hattarki 4 4 100 Chairman

Mr. B C Prabhakar 4 4 100 Member
Mr. Rakesh Kalra LOA 3 4 75 Member
The Audit Committee assists the Board in its responsibility to purpose is to oversee the accounting and financial reporting
oversee the quality and integrity of the accounting, auditing statements, the appointment, independence, performance
and reporting practices of the Company and its compliance and remuneration of the Statutory Auditors, including the
with the legal and regulatory requirements. The Committee’s Secretarial Auditor and Internal Auditors of the Company.
51
Qualified and Independent Audit Reviewing the adequacy of internal control systems with
Committee the management, statutory and internal auditors;
The composition of the Audit Committee meets with the
requirements of Section 177 of the Companies Act, 2013 and
Evaluation of internal financial controls and risk
Regulation 18 of Securities and Exchange Board of India (Listing management systems;
Obligations and Disclosure Requirements) Regulations, 2015.
Review and monitor the auditor’s independence and
1. Audit Committee presently consists of the three Independent performance effectiveness of audit process;
Directors.

Recommending to the Board, the appointment,
2. All members of the committee are financially literate and reappointment and, if required, the replacement or
having requisite financial management expertise. removal of the Statutory Auditors, scope and the
fixation of audit fees;
3. The Chairman of the Audit Committee is an Independent
Director Approval of payment to statutory auditors for any other
services rendered by the statutory auditors;
Powers of the Audit Committee
To investigate any activity within its terms of reference. Review of Management letters/letters of internal control
weaknesses issued by the Statutory Auditors;
To seek information from any employee.
The appointment, removal and terms of remuneration
To obtain outside legal or other professional advice. of the Internal Auditors;

To secure attendance of outsiders with relevant Reviewing the effectiveness and adequacy of internal
expertise, if it considers necessary. audit function and discussion with internal auditors any
significant findings and follow up there on;
Role of the Audit Committee inter alia
includes the following: Approval or any subsequent modification of transactions
The terms of reference of Audit Committee consist of review of the Company with related parties;
and recommendation to the Board on certain matters
including the following: Scrutiny of inter-corporate loans and investments;

Review of Management discussion and analysis of Valuation of undertakings or assets of the Company,
financial condition and results of operations; wherever it is necessary;
Oversight of Company’s financial reporting system;

To review the functioning of the Whistle Blower
mechanism;

Review of the annual financial statements, before
submission to the Board, focusing primarily on Approval of appointment of CFO or any other person
changes if any, in the accounting policies or practices, heading the finance function after assessing the
compliance of accounting standards, qualifications, qualifications, experience & background, etc. of the
related party transactions, Directors’ responsibility candidate;
statement etc.;
Carrying out such other functions, as may be specifically
Reviewing with the management the quarterly financial referred to the Committee by the Board of Directors
statements before submission to the board for approval; and or other Committees of Directors of the Company;
52
NOMINATION AND REMUNERATION

COMMITTEE (NRC)
The Nomination and Remuneration Committee consists of

three Independent Directors:
Mr. B C Prabhakar, Chairman,

Mr. Rakesh Kalra, Member
Dr. Shalini Sarin, Member
The committee met three (3) times during the year on 13th May 2019, 13th August 2019 and 14th February 2020.
Attendance record of NRC members for 2019-20

NRC meeting held during the year 2019-20
Total Total No. of
Name of the Director Attendance % Status
Attendance Meetings
13 May 19
th
13 Aug 19
th
14 Feb 20
th
Mr. B C Prabhakar LOA 2 3 67 Chairman

Mr. Rakesh Kalra 3 3 100 Member
Dr. Shalini Sarin 3 3 100 Member
Terms of Reference Independent Directors

To identify qualified persons to become directors and Schedule IV of the Companies Act, 2013 and the Rules under
senior management in accordance with the criteria laid mandates that the Independent Directors of the Company hold
down, recommend to the Board their appointment and at least one meeting in a year, without the attendance of non-
removal and to carry out evaluation of every director’s independent directors and the members of management. It is
performance. recommended that all the independent directors to be present
at such meetings. These meetings are expected to review the
To formulate the criteria for determining qualifications, performance of the non-independent directors and the Board
positive attributes and independence of a director as a whole, as well as the chairman of the Board, taking
and recommend to the Board a policy, relating to into account the views of the non-executive directors, assess
the remuneration for the directors, key managerial the quality, quantity and timeliness of the flow of information
personnel and other employees. between the management and the Board that is necessary for
it to effectively and reasonably perform its duties.
Formulation of criteria for evaluation of Independent
Directors and the Board Confirmation: In the opinion of the board, the independent
directors fulfill the conditions specified under Securities and
Devising policy on Board diversity Exchange Board of India (Listing Obligation and Disclosure
Requirements) Regulations, 2015 and are independent of the

To act in terms of any consequent statutory management.
modification(s) /amendment(s) / revision(s) to any of
the applicable provisions to the said Committee. The weblink where the details of familiarisation programme
imparted to independent directors is available at www.

To decide on terms of appointment/re-appointment autoaxle.com
of Independent Director based on the performance
evaluation report received.
53
During the year 2019-20, Independent Directors met on c) Raising of valid concerns to the Board and constructive
10th February, 2020, discussed and reviewed the below: contribution to resolution of issue at meetings
Performance of Non-Independent Directors d)

Interpersonal relations with other Directors &
Performance of Chairman Management
Performance of Board Committees
Discussed on the quality, quantity and timeliness of flow e)
Objective evaluation of Board’s performance,
of information between the Company management rendering independent, unbiased opinion
and the Board Members.
Overall performance of the Company. f)
Understanding of the company and the external
environment in which it operates and contribution to
Performance evaluation criteria for strategic direction.
independent directors:
a)
Attendance and participation in the meetings and g)
Safeguarding interest of whistle-blowers under vigil
timely inputs on the minutes of the meetings mechanism and safeguard of confidential information.
b) Adherence to ethical standards and code of conduct of

company and disclosure of non-independence, as and
when exists and disclosure of interest
Remuneration of Directors
The details of remuneration to Directors, their relationship with each other and Equity Shares held as on 31st March, 2020 are
presented below:
Audit
Board Salaries,
Relationship Equity Committee
Meeting performance
Directors with other Shares Meetings Total (In `)
Sitting Fees bonus and
Directors held Sitting Fees
(In `) perquisites (In `)
(In `)
Dr. B.N. Kalyani None 126 2,00,000 N.A. Nil 2,00,000
Mr. Chrishan Anton None Nil N.A N.A Nil N.A
Sebastian Villavarayan*
Mr. B B Hattarki None Nil 2,00,000 2,00,000 Nil 4,00,000
Mr. B C Prabhakar None 575 1,50,000 2,00,000 Nil 3,50,000
Mr. Rakesh Kalra None Nil 1,50,000 1,50,000 Nil 3,00,000
Dr. Shalini Sarin None Nil 2,00,000 N.A. Nil 2,00,000
Dr. N Muthukumar None Nil NA NA 71,58,415 71,58,415
(Resigned w.e.f. 14.08.2019)
Mr. Srinivasan Kumaradevan None Nil NA NA 64,14,051 64,14,051
Note:
1. *Mr. Chrishan Anton Sebastian Villavarayan does not claim any sitting fee, being in conformity with Meritor’s Policy for such nominees for attending the meetings.
2. All the above elements are fixed component but for the Performance linked Bonus
Directors with materially significant STAKEHOLDERS RELATIONSHIP

pecuniary transaction or relationship COMMITTEE (SRC)
with the Company The Stakeholders Relationship Committee comprises of
There was no pecuniary relationship or transactions between three directors and meets the requirement under section
the Company and any of the Non-Executive Directors during 178(5) of the Companies Act, 2013 and Regulation 20 of
the year as contemplated under relevant guidelines of the Securities and Exchange Board of India (Listing Obligations
SEBI/Stock Exchanges. and Disclosure Requirement) Regulations, 2015.
54
Mr. B.C. Prabhakar, Chairman The Committee met four times during the year on 13th May,
Mr. Rakesh Kalra, Member 2019, 13th August, 2019, 4th November, 2019 and 10th
Mr. Srinivasan Kumaradevan, Member February, 2020.
During the year the SRC has been reconstituted by replacing

Dr. N. Muthukumar with Mr. Srinivasan Kumaradevan.
Attendance record of SRC members for 2019-20
SRC Meeting held during 2019-20
Total Total No. of
13th May 19 13th Aug 19 4th Nov 19 10th Feb 20 Attendance Meetings
Mr. B C Prabhakar 4 4 100 Chairman

Mr. Rakesh Kalra LOA 3 4 75 Member
Dr. N Muthukumar NA NA 2 2 100 Member
(Resigned w.e.f.
14.08.2019)
Mr. Srinivasan NA NA 2 2 100 Member
Kumaradevan
(Appointed w.e.f.
14.08.2019)
Compliance Officer To act in terms of any consequent statutory modification(s)

Mr. Debadas Panda, Company Secretary & Compliance / amendment(s) / revision(s) to any of the applicable
Officer, is the Compliance Officer of the Company for provisions to the said Committee.
complying with requirements of the Securities Laws and
Securities and Exchange Board of India (Listing Obligation Number of Shareholders’ complaint received 3
and Disclosure Requirements) Regulations, 2015. during 2019-20
Number of complaints not solved to the Nil
Terms of Reference of SRC inter alia satisfaction of the shareholders
include the following: Number of pending complaints Nil
Resolving the grievances of the security holders of the
listed entity including complaints related to transfer/ CORPORATE SOCIAL RESPONSIBILITY
transmission of shares, non-receipt of annual report, COMMITTEE (CSR)
non-receipt of declared dividends, issue of new/ The Committee comprises of three members as on 31st
duplicate certificates, general meetings etc. March, 2020:
Review of measures taken for effective exercise of voting Mr. B C Prabhakar, Chairman,
rights by shareholders Dr. Shalini Sarin, Member
Mr. Srinivasan Kumaradevan, Member
Review of adherence to the service standards adopted
by the listed entity in respect of various services being During the year the CSR has been reconstituted by replacing
rendered by the Registrar & Share Transfer Agent Dr. N. Muthukumar with Mr. Srinivasan Kumaradevan.
Review of the various measures and initiatives taken by The CSR committee met two times during the year on 13th
the listed entity for reducing the quantum of unclaimed May, 2019, 14th February, 2020.
dividends and ensuring timely receipt of dividend
warrants/annual reports/statutory notices by the
shareholders of the company
55
Attendance record of CSR members for 2019-20
CSR Meeting held during the year 2019-20

Total Total No. of
13th May 19 14th Feb 20 Attendance Meetings
Mr. B C Prabhakar LOA 1 2 50 Chairman

Dr. Shalini Sarin 2 2 100 Member
Dr. N Muthukumar NA 1 1 100 Member
(Resigned w.e.f. 14.08.2019)
Mr. Srinivasan Kumaradevan NA 1 1 100 Member
Terms of reference inter alia includes the following: Policy. The CSR policy is available on the website of the
To formulate and recommend to the Board, a Corporate Company at www.autoaxle.com/Policy.aspx
Social Responsibility Policy in terms of Schedule VII of
the Companies Act, 2013. RISK MANAGEMENT COMMITTEE (RMS)
The Committee comprises of two members as on 31st

To recommend the amount of expenditure to be March, 2020:
incurred on the CSR activities.
Mr. B C Prabhakar, Chairman
To review the Corporate Social Responsibility Policy of Mr. Srinivasan Kumaradevan, Member
the Company from time to time and
During the year the RMS has been reconstituted by replacing

To act in terms of any consequent statutory Dr. N. Muthukumar with Mr. Srinivasan Kumaradevan
modification(s)/amendment(s)/revision(s) to any of the
applicable provisions to the said Committee. The RMS committee met four times during the year on 13th
May, 2019, 13th August, 2019, 4th November, 2019 and
The Committee’s prime responsibility is to assist the Board in 10th February, 2020
discharging its social responsibilities by way of formulating
and monitoring implementation of the framework of CSR
RMS meeting held during the year 2019-20 Total

Total Attendance
Name of the Director 10th Feb 20 No. of Status
13 May 19
h
13 Aug 19
th
4 Nov 19
th Attendance %
Meetings
Mr. B C Prabhakar 4 4 100 Chairman

Dr. N Muthukumar NA NA 2 2 100 Chairman
(Resigned w.e.f.
14.08.2019)
Mr. Srinivasan NA NA 2 2 100 Member
Kumaradevan
(Appointed w.e.f.
14.08.2019)
Terms of Reference inter alia include the following: Your Company has voluntarily constituted the Risk Management
The Committee shall monitor and review the risk management Committee though it is not compulsorily required under the
plan and such other functions as it may deem fit. Securities and Exchange Board of India ((Listing Obligation
and Disclosure Requirements) Regulations, 2015.
56
Names of the listed entities where the person is 6. Dr. Shalini Sarin
a director and the category of directorship (DIN: 06604529)
SL
Name of the Companies Category
No
1. Dr. Babasaheb Neelkanth Kalyani
1 AUTOMOTIVE AXLES LIMITED Non-Executive,
(DIN: 00089380)
Independent Director
SL
Name of the Companies Category 2 LINDE INDIA LIMITED Non-Executive,
No
1 HIKAL LIMITED Non Executive Director Independent Director
2 BHARAT FORGE LIMITED Executive Director 3 KIRLOSKAR OIL ENGINES Non-Executive,
3 KALYANI STEELS LIMITED Non Executive Director LIMITED Independent Director
4 BF UTILITIES LIMITED Promoter, Non Executive
7. Mr. Srinivasan Kumaradevan
5 AUTOMOTIVE AXLES LIMITED Non-Executive,
(DIN: 08107660)
Non Independent
SL
No
2. Chrishan Anton Sebastian Villavarayan
1 AUTOMOTIVE AXLES LIMITED Wholetime Director
(DIN: 03020467)
SL
No
Name of the Companies Category Skills/ Expertise/Competencies of the Board
1 AUTOMOTIVE AXLES LIMITED Non-Executive, List of core skills/
expertise/competencies
Non Independent identified by the
Availability of
the Identified Name of directors
board of directors as
3. Bhalachandra Basappa Hattarki required in the context
skills/ who have such skill/
Expertise/ Expertise/Competencies
(DIN: 00145710) of its business(es) and
Competencies
sector(s) for it to function
SL
Name of the Companies Category effectively
No
1 Leadership Skill Available All the Board Members
1 KALYANI STEELS LIMITED Independent Director
2 Operations Available Dr. B. N. Kalyani
2 BF UTILITIES LIMITED Non-Executive,
Management of Mr. Chrishan Anton
Independent Director
Automotive Sector Sebastian Villavarayan
3 AUTOMOTIVE AXLES LIMITED Non-Executive, Mr. Rakesh Kalra
Independent Director Mr. Srinivasan
4 BF INVESTMENT LIMITED Independent Director Kumaradevan
5 KALYANI INVESTMENT Non-Executive, 3 Project Available Mr. Srinivasan
COMPANY LIMITED Independent Director Management Kumaradevan
4 Strategic Planning Available Dr. B. N. Kalyani
4. Bhoopalam Chandrashekharaiah Prabhakar Mr. Rakesh Kalra
(DIN: 00040052) 5 Expertise in forging Available Dr. B. N. Kalyani
SL industry Mr. B. B. Hattarki
No
6 Expertise in Available Mr. B.C. Prabhakar
1 PAGE INDUSTRIES LIMITED Independent Director
Industrial Law
2 AUTOMOTIVE AXLES LIMITED Non-Executive, 7 Human resource Available Mr. B. C. Prabhakar
Independent Director management Dr. Shalini Sarin
5. Rakesh Kalra 8 Technical Skill Available Dr. B. N. Kalyani
(DIN: 00780354) Mr. Chrishan Anton
SL Sebastian Villavarayan
No Mr. B. B. Hattarki
1 KRITI NUTRIENTS LIMITED Non-Executive, Mr. Rakesh Kalra
Independent Director Mr. Srinivasan
2 KRITI INDUSTRIES (INDIA) Non-Executive, Kumaradevan
LIMITED Independent Director 9 Economy & Available Dr. B. N. Kalyani
Finance Mr. Chrishan Anton
3 JAMNA AUTO INDUSTRIES Independent Director
LIMITED
Mr. B. B. Hattarki
4 AUTOMOTIVE AXLES LIMITED Non-Executive, Mr. Srinivasan
Independent Director Kumaradevan
57
10 Marketing and Available Dr. B. N. Kalyani No Extraordinary General Meeting of the Members was
sourcing Mr. Chrishan Anton held during the financial year 2019-20.
Mr. Srinivasan
Kumaradevan Resolution passed through Postal Ballot
11 Governance and Available Dr. B. N. Kalyani No resolution was passed through Postal Ballot during the
Risk Management Mr. Chrishan Anton year 2019-20.
Mr. Srinivasan None of the business proposed to be transacted in the
Kumaradevan ensuing Annual General Meeting requiring passing a
Special Resolution conducted through Postal Ballot.
Secretarial Audit for Reconciliation of
Share Capital DISCLOSURES
As mandated by the Securities and Exchange Board of Related Party Transactions:
India (Depositories and Participants) Regulations, 1996 – All Related Party Transactions are placed before the Audit
Regulation 55A quarterly Secretarial Audits are carried out to Committee and also the Board for approval. Prior omnibus
verify if the total issued/ paid-up capital is in agreement with approval of the Audit Committee is obtained for the
the aggregate of the total number of the shares in physical transactions which are of a foreseen and repetitive nature.
form and the total number of dematerialised shares held with A statement giving details of all related party transactions
NSDL and CDSL. is placed before the Audit Committee and the Board of
Directors for their approval on a quarterly basis.
General Body Meetings
Date, time and venue for the last three Annual General None of the transactions with any of the related parties were
Meetings are given below in conflict with the interest of the Company. Attention of
the Members is drawn to the disclosure set out in notes to
Financial
Date Time Venue
Special Resolutions Financial Statement.
Year Passed
2016-17 18th 12.30 Regd. None
A Policy on Related Party Transactions is being uploaded in
August p.m. Office
2017 of the the website of the company www.autoaxle.com/Policy.aspx
Company
2017-18 13th 12.30 Regd. None Management Discussion & Analysis:
August p.m. Office This Annual Report has a detailed chapter on Management
2018 of the Discussion and Analysis and includes discussion on various
Company matters specified under Regulation 34 of Securities and
2018-19 14th 3.15 Regd. 1.Re-appointment of Exchange Board of India (Listing Obligations and Disclosure
August p.m. Office Mr. Bhalachandra Requirements) Regulations, 2015.
2019 of the Basappa Hattarki
Company as an Independent
Director of the
Whistle Blower Mechanism
Company The Board has formulated a Whistle Blower Policy for
2.Re-appointment directors and employees of the Company. The policy
of Mr. Bhoopalam comprehensively provides an opportunity for an employee/
Chandrashekharaiah Director to report the instances of unethical behavior, actual
Prabhakar as an or suspected fraud or any violation of the Code of Conduct
Independent Director and /or laws applicable to the Company and seek redressal.
of the Company The policy provides for a mechanism to report such concerns
3.Re-appointment of
to the Audit Committee through specified channels. The
Dr. N. Muthukumar
(DIN: 06708535),
policy has been communicated to the employees and also
President & Whole posted on Company’s website.
Time Director for a
period of five years
58
The Whistle Blower Policy complies with the requirements complaints of sexual harassment at workplace.
of Vigil mechanism as stipulated under Section 177 of
the Companies Act, 2013. The details of establishment of a. number of complaints filed during the financial : NIL
Whistle Blower Policy/Vigil Mechanism have been disclosed year
on website of the Company www.autoaxle.com/Policy.aspx. b. number of complaints disposed of during the : NIL
financial year
No personnel have been denied access to audit committee. c. number of complaints pending as on end of the :NIL
financial year
Compliances by the Company
The Company has complied with all the requirements of MEANS OF COMMUNICATION
regulatory authorities and no non-compliance on matter Your Company puts forth all vital information about the
related to capital market has been reported during the Company’s performance including quarterly result and
year under review and hence no penalties/strictures were communication to investors on Company’s website: www.
imposed on the Company by the Stock Exchanges or SEBI autoaxle.com regularly for the benefit of the public at large
or any Statutory Authority on any matter related to capital
market during the year. The unaudited Financial Results for every Quarter and the
Annual Audited Results of the Company, in the prescribed
Further there are no instances of non-compliances with format are taken on record by the Board and are submitted
respect to capital market during the last three years. to the stock exchanges. The same are published within 48
hours in “The Financial Express” and “The Andolana”.
Certificate from CS Pracheta M, Practicing Company
Secretary having membership no. FCS 9323 and Certificate The quarterly/annual results are also uploaded on the
of Practice No. 9838 has been obtained, certifying that Company’s website at:www.autoaxle.com/Financial_
none of the directors on the board of the company have reports.aspx
been debarred or disqualified from being appointed or
continuing as directors of companies by the Board/Ministry COMPLIANCE WITH MANDATORY &
of Corporate Affairs or any such statutory authority NON MANDATORY REQUIREMENTS/
DISCRETIONARY REQUIREMENTS:
Total fees for all services paid by the company to the statutory The Company has complied with the applicable mandatory
auditor M/s. S R Batliboi & Associates LLP, Chartered requirements of Securities and Exchange Board of
Accountants [Firm Registration No.: 101049W/E300004] India (Listing Obligations and Disclosure Requirements)
and all entities in the network firm/network entity of which Regulations, 2015. The Company has adopted following
the statutory auditor is as below: non-mandatory requirements of Securities and Exchange
Board of India (Listing Obligations and Disclosure
1. Total fees for all services paid by the company to the Requirements) Regulations, 2015 (Regulation 27(1)).
statutory auditor M/s. S R Batliboi & Associates LLP has
been provided in Note 28 of the financial statement. Modified Opinion(s) in Audit Report
The Company is in the regime of financial statements with
2. Ernst & Young Associates LLP : INR 1,85,988.66 unmodified audit opinion.
Disclosures in relation to the Sexual Separate posts of Chairman and Chief

Harassment of Women at Workplace Executive Officer (CEO)
(Prevention, Prohibition and Redressal) The company has appointed separate persons to the post of
Act, 2013: the Chairman and the CEO. CEO has been designated as
The Company has zero tolerance for sexual harassment President & Whole-time Director.
at workplace and has adopted a Policy in line with the
provisions of the Sexual Harassment of Women at Workplace Reporting of Internal Auditor
(Prevention, Prohibition and Redressal) Act, 2013 and the The Internal auditor reports directly to the Audit Committee.
Rules made thereunder for prevention and redressal of
59
SEBI Complaints System (SCORES) Accordingly, the Company has sent the reminder letters to
The investor complaints are processed in a centralised web the shareholders on dated 25th Nov, 2019 during the year.
based complaints redress system. The salient features of this
system are: centralised database of all companies, online Presentations to Institutional Investor
upload of Action Taken reports by concerned companies and Analyst:
and online viewing by investors of action taken on the Detailed presentations are made to the Institutional Investors and
complaints and its current status. Financial Analysts on the un-audited quarterly financial results as
well as the annual audited financial results of the company.
Reminders to Investors
Every year reminder letters for unpaid dividend are sent
to the shareholders who have not claimed their dividend.
GENERAL SHAREHOLDER INFORMATION

Annual General Meeting Date & Time : 19th August 2020 at 3.00 p.m.
Venue : Through Video Conferencing facility or other Audio Visual means.
The deemed venue will be, Registered Office of the Company at Hootagalli
Industrial Area, Off Hunsur road, Mysuru, Karnataka – 570018
CIN L51909KA1981PLC004198
Financial Year 1st April, 2019 to 31st March, 2020
Book Closure Dates 14th August, 2019 to 19th August, 2020 (both days inclusive)
Dividend Payment Date Expected on or before 17th September, 2020
Plant Locations Mysuru Plant :
Hootagalli Industrial Area
Off Hunsur Road, Mysuru, Karnataka - 570018
Rudrapur Plant :
Plot No. 3, ITBT Park, SIIDCL - IEE, Pant Nagar (NH-4),
Dist. Udham Singh Nagar,Uttarakhand - 263150
Jamshedpur Plant :
Old Khakripara, Vill & Post – Chhota Govindpur,
Jamshedpur, Dist. E. Singhbhum, Jharkhand - 831015
Hosur Plant:
Plot No 39, Sipcot Industrial Area, LAS Phase-I,
Mookandapalli, Hosur, Tamilnadu, 635126
Securities Listing BSE Limited, Phiroze Jeejeebhoy Towers, Dalal Street, Mumbai - 400001
National Stock Exchange of India Limited, Exchange Plaza, 5th Floor, Plot No. C/1, G Block,
Bandra-Kurla Complex, Bandra East, Mumbai - 400 051
The Company confirms that the annual listing fee for the year 2019-20 has been paid to both
the stock exchanges.
Stock Codes BSE – 505010
NSE – AUTOAXLES
Demat ISIN Number: INE449A01011
60
Stock Data
Monthly High and Low price at which the shares of the Company were traded at the BSE and NSE are given
below:
BSE NSE
Month
High (In `) Low (In `) No. of Shares Traded High (In `) Low (In `) No. of Shares Traded
April, 2019 1,255 1,130 11,729 1,255 1,125 96,908
May, 2019 1,222 1,042 14,881 1,224 1,030 2,75,609
June, 2019 1,155 1,001 9,127 1,160 1,001 1,21,137
July, 2019 1,115 775 39,874 1,097 773 2,53,514
August, 2019 844 731 14,648 844 725 1,42,258
September, 2019 1,019 783 32,921 1,019 781 2,00,092
October, 2019 995 833 11,489 995 834 2,10,205
November, 2019 970 775 42,112 980 780 2,91,310
December, 2019 862 770 28,451 864 771 1,70,894
January, 2020 907 802 11,998 910 801 2,03,074
February, 2020 855 686 20,976 860 685 1,92,806
March, 2020 700 336 50,098 717 336 2,47,412
The performance of the company’s scrip on BSE and NSE as compared to the SENSEX and NIFTY AUTO during
the year 2019-20 are as under: -
AAL Share AAL Share

SENSEX NSE NIFTY AUTO
Month Price on BSE Price NSE
High (In `) Low (In `) High (In `) Low (In `) High (In `) Low (In `) High (In `) Low (In `)
April, 2019 1255 1130 39487 38460 1255 1125 9059 8294
May, 2019 1222 1042 40125 36956 1224 1030 8517 7822
June, 2019 1155 1001 40312 38871 1160 1001 8358 7723
July, 2019 1115 775 40032 37128 1097 773 8099 6728
August, 2019 844 731 37808 36102 844 725 7203 6733
September, 2019 1019 783 39441 35988 1019 781 7939 6745
October, 2019 995 833 40392 37416 995 834 8501 7297
November, 2019 970 775 41164 40014 980 780 8499 7973
December, 2019 862 770 41810 40135 864 771 8338 7774
January, 2020 907 802 42274 40477 910 801 8463 7901
February, 2020 855 686 41709 38220 860 685 8212 6883
March, 2020 700 336 39083 25639 717 336 7048 4452
Share Transfer System & Share Transfer In compliance with the SEBI circular dated 27th December 2002, requiring share registry
Agents in terms of both physical and electronic mode to be maintained at a single point, the
Company has appointed Integrated Registry Management Services Private Limited, No.
30, Ramana Residency, 4th Cross, Sampige Road, Malleswaram, Bangalore 560 003, as
its Registrar and Share Transfer Agents (RTA). Company’s shares are traded on the Stock
Exchanges compulsorily in demat mode.
61
Shareholding pattern as on 31st March 2020:

Pattern of Shareholding by ownership Pattern of shareholding by share class
Share No. of Shares No. of Shares Share
Ownership No. of Shares held Category
holding holders held holding
% %
Promoters 10,735,081 71.04 =/< 500 17,390 973,170 6.44
Non Promoter (Public) 501-1000 289 221,301 1.46
Bodies Corporate 252,628 1.67 1001-2000 162 233,303 1.54
FI/ Foreign Portfolio Investor’s & Bank 126,345 0.84 2001-3000 63 150,738 1.00
NRI’s 93,096 0.62 3001-4000 24 82,530 0.55
Mutual Funds 1,467,201 9.71 4001-5000 18 84,206 0.56
Others 2,437,624 16.12 5001-10000 22 157,114 1.04
Total 15,111,975 100 > 10000 21 13,209,613 87.41
Total 17,989 15,111,975 100
Dematerialization The Company’s Equity Shares are under compulsory demat trading. As on 31st March 2020,
dematerialised shares accounted for 99.57% of total equity.
Audit Qualification There is no audit qualification in the financial Statements of the Company for the year ended
31st March, 2020
List of credit ratings obtained
Credit Rating Agency : ICRA Limited
Rating as on 01.04.2019
Instrument Rating Action
Long Term Fund based facilities [ICRA]A+ (Positive)
Short Term Non fund based facilities [ICRA]A1+
Revised Rating with effect from September 27, 2019
Instrument Rating Action
Long Term Fund based facilities [ICRA]A+ (Stable)
Short Term Non fund based facilities [ICRA]A1+
Investor Grievance Correspondence :
Company Share Transfer Agents
Secretarial Dept. Integrated Registry Management Services Pvt.Ltd
Automotive Axles Limited No. 30 Ramana Residency, 4th Cross
Hootagalli Industrial Area, Sampige Road, Malleswaram
Off Hunsur Road, Mysuru - 570 018 Bangalore – 560 003
Phone : 0821-7197500 Phone: 080-23460815-818
Fax : 0821-2402451 Fax : 080-23460819
Email : sec@autoaxle.com E-mail : irg@integratedindia.in
DECLARATION ON COMPLIANCE WITH THE CODE OF CONDUCT

I, Srinivasan Kumaradevan, Senior Vice President & Whole-time Director of Automotive Axles Limited hereby declare that all
the Board Members and Senior Managerial Personnel have affirmed for the year ended 31st March, 2019 compliance with
the Code of Conduct of the Company laid down for them.
Place: Mysuru Mr. Srinivasan Kumaradevan

Date: 26th May, 2020 Sr. Vice President & Whole Time Director
62
TO THE BOARD OF DIRECTORS OF AUTOMOTIVE AXLES LIMITED

Certification by Chief Executive Officer and Chief Financial Officer of the Company
We, Srinivasan Kumaradevan, Sr. Vice President & Whole time Director and Ranganathan S., Chief Financial Officer
of Automotive Axles Limited as required under the Regulation 17(8) of Securities and Exchange Board of India (Listing
Obligations and Disclosure Requirements) Regulations, 2015 to the best of our knowledge and belief, certify with respect to
the financial results for the financial year ending 31st March 2020 as follows:
A. We have reviewed the financial statements and the cash flow statement for the year and that to the best of our knowledge
and belief
1) these statements do not contain any materially untrue statement or omit any material fact or contain statements that
might be misleading;
2) these statements together present a true and fair view of the Company’s affairs and are in compliance with existing
accounting standards, applicable laws and regulations.
B. There are, to the best of our knowledge and belief, no transactions entered into by the Company during the year which
are fraudulent, illegal or violative of the Company’s code of conduct.
C. We accept responsibility for establishing and maintaining internal controls for financial reporting and that we have
evaluated the effectiveness of internal control systems of the listed entity pertaining to financial reporting and we have
disclosed to the auditors and the audit committee, deficiencies in the design or operation of such internal controls, if
any, of which we are aware and the steps they have taken or propose to take to rectify these deficiencies.
D. We have indicated to the auditors and the Audit committee:
1) significant changes in internal control over financial reporting during the year;
2) significant changes in accounting policies during the year and that the same have been disclosed in the notes to
the financial statements; and
3) Instances of significant fraud of which we have become aware and the involvement therein, if any, of the management
or an employee having a significant role in the Company’s internal control system over financial reporting.
Place: Mysuru Srinivasan Kumaradevan Ranganathan S.

Date: 26th May, 2020 Sr. Vice President & Wholetime Director Chief Financial Officer
63
CERTIFICATE OF THE COMPLIANCE WITH THE CONDITIONS OF CORPORATE

GOVERNANCE UNDER SECURITIES AND EXCHANGE BOARD OF INDIA (LISTING
OBLIGATIONS AND DISCLOSURES REQUIREMENTS) REGULATIONS, 2015
Registration No. of the Company: L51909KA1981PLC004198

Nominal Capital: `250,000,000/-
To,
The Members of
Automotive Axles Limited
I have examined the compliance of the conditions of Corporate Governance by Automotive Axles Limited (hereinafter
referred to as ‘Company’), for the financial year ended 31st March 2020, as stipulated under Securities and Exchange Board
of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (hereinafter referred to LODR Regulations).
The compliance with the conditions of Corporate Governance is the responsibility of the management. My examination
was limited to the procedure and implementation thereof by the Company. This Certificate is neither an assurance as to the
future viability of the Company nor of the efficacy or effectiveness with which the management has conducted the affairs of
the Company.
On the basis of my examination of the records produced, explanations and information furnished to me by the Company,
I certify that the Company has complied with the mandatory conditions of Securities and Exchange Board of India (Listing
Obligation and Disclosure Requirements) Regulations, 2015
CS. Pracheta M.
Practicing Company Secretary
Place: Mysuru C.P.No.9838
Date: 26th May, 2020 UDIN:F009323B000276491
64
Business Responsibility Report

SECTION A- GENERAL INFORMATION
1 Corporate Identity Number (CIN) of the Company L51909KA1981PLC004198

2 Name of the Company AUTOMOTIVE AXLES LIMITED
3 Registered address Hootagalli Industrial Area, Off. Hunsur Road, Mysore,
Karnataka - 570018
4 Website www.autoaxle.com
5 E-mail id sec@autoaxle.com
6 Financial Year reported 2019-20
7 Sector(s) that the Company is engaged in (industrial activity NIC Code Description
code-wise)
29301 Rear Drive Axles
29301 Brakes
8 List three key products/services that the Company i) Rear Drive Axles
manufactures/provides (as in balance sheet) ii) Brakes
iii) Suspension
9 Total number of locations where business activity is
undertaken by the Company
(a) Number of International Locations (Provide details of Nil
major 5)
(b) Number of National Locations Registered Office:
Hootagalli Industrial Area, Off. Hunsur Road, Mysore, Karnataka
- 570018
Manufacturing locations:
Jamshedpur, Rudrapur, Hosur
10 Markets served by the Company – Local/State/National/ India
International
SECTION B- FINANCIAL DETAILS OF THE COMPANY

1 Paid up Capital (INR) Rs.151.12 million
2 Total Turnover (INR) Rs. 9596.81 million
3 Total profit after taxes (INR) Rs. 411.34 million
4 Total Spending on Corporate Social Responsibility (CSR) as 6.26 % of net profit of the Company was spent towards Corporate
percentage of profit after tax (%) Social Responsibility during the financial year 2019-20.
5 List of activities in which expenditure in 4 above has been (i) Nearby park development
incurred:- (ii) Renovation of Lake
(iii) Promoting Culture
(iv) Skill development initiatives
(v) Contribution towards PM’s CARES Fund
65
SECTION C- OTHER DETAILS

1 Does the Company have any Subsidiary Company/ No
Companies?
2 Do the Subsidiary Company/Companies participate in the Not Applicable
BR Initiatives of the parent company? If yes, then indicate
the number of such subsidiary company(s)
3 Do any other entity/entities (e.g. suppliers, distributors The other entities with which the Company does business with
etc.) that the Company does business with, participate in viz. suppliers, distributors, etc. are not directly included in the BR
the BR initiatives of the Company? If yes, then indicate the initiatives of the Company.
percentage of such entity/entities? [Less than 30%, 30-60%,
More than 60%]
SECTION D- BR INFORMATION
1 Details of Director/Directors responsible for BR:
(a) Details of the Director/Director responsible for
implementation of the BR policy/policies
No. Particulars Details
1. DIN Number 08107660
2. Name Mr. S. Kumaradevan
3. Designation Sr. Vice President & Wholetime Director
(b) Details of the BR head
No. Particulars Details
1 DIN Number (if applicable) 08107660
2 Name Mr. S. Kumaradevan
3 Designation Sr. Vice President & Wholetime Director
4 Telephone number +91 821 7197500
5 e-mail id kumar@autoaxle.com
2. Principle-wise (as per NVGs) BR Policy

The Company’s policies are in line with the National Voluntary Guidelines on Social, Environmental and Economic
Responsibilities of Business (NVGs) which provides for the following (09) nine areas of Business Responsibility to be
adopted by the organizations:-
Principle 1 Ethics, Transparency and Accountability Principle 6 Environment

Principle 2 Products Sustainability Principle 7 Public Policy
Principle 3 Employees’ Well-being Principle 8 Inclusive Growth
Principle 4 Stakeholder Engagement Principle 9 Customer Relations
Principle 5 Human Rights
a) Details of Compliances :
Sr.
Questions P1 P2 P3 P4 P5 P6 P7 P8 P9
No.
1. Do you have a policy/ policies for Y Y Y Y Y Y Y Y Y
The policy is
embedded in the
Company’s Code of
Conduct, Ethics and
HR policies
2. Has the policy being formulated Y Y Y Y NA Y Y Y Y
in consultation with the relevant
stakeholders?
66
Sr.
No.
3. Does the policy conform to Yes, the policies are in line with international standards such as ISO 9001:2015,
any National / International IATF 16949:2016, EMS ISO 14001:2015, BS OHSAS ISO-45001:2018 and meet
standards? If yes, specify? (50 National regulatory requirements such as the Companies Act, 2013 and SEBI (Listing
words) Obligations and Disclosure Requirements) Regulations, 2015. Also guidelines as per
NVGs on social, environment and economic responsibility of business have been
considered for formulation of some policies.
4. Has the policy being approved Y Y Y Y NA Y Y Y Y
by the Board? If Yes, has it been
signed by MD/Owner/CEO/
appropriate Board Director.
5. Does the company have a These policies are administered and supervised by the management of the Company
specified committee of the Board/ through a robust internal governance structure.
Director/Official to oversee the
implementation of the policy
6. Indicate the link for the policy to https://www.autoaxle.com/Investor_Policy.aspx
be viewed online
7. Has the policy been formally Y Y Y Y NA Y Y Y Y
communicated to all relevant
internal and external stakeholders
8. Does the company have in-house Y Y Y Y NA Y Y Y Y
structure to implement the policy
/ policies
9. Does the Company have a Y Y Y Y NA Y Y Y Y
grievance redressal mechanism
related to the policy/policies to
address stakeholders’ grievances
related to the policy/ policies
10 Has the company carried out The Policies on Quality, Safety and Health and Environment are subject to internal and
independent audit/ evaluation of external audits as part of certification process and ongoing periodic assessments. Other
the working of this policy by an policies are periodically evaluated for their efficacy through Internal Audit mechanism.
internal or external agency
(b) If answer to the question at serial number 1 against any principle, is ‘No’, please explain why: (Tick
up to 2 options)
Sr.
No.
1. The company has not understood the - - - - - - - - -
Principles
2. The company is not at a stage where - - - - - - - - -
it finds itself in a position to formulate
and implement the policies on specified
principles
3. The company does not have financial - - - - - - - - -
or manpower resources available for
the task
4. It is planned to be done within next 6 - - - - - - - - -
months
5. It is planned to be done within the next - - - - - - - - -
1 year
6. Any other reason (please specify) - - - - - - - - -
67
GOVERNANCE RELATED TO BR
(a) Indicate the frequency with which the Board of Directors, Annually
Committee of the Board or CEO to assess the BR
performance of the Company. Within 3 months, 3-6 months,
Annually, More than 1 year
(b) Does the Company publish a BR or a Sustainability Report? As the disclosure is applicable from this year and it will be
What is the hyperlink for viewing this report? How frequently published as part of Annual Report for the FY 2019-20
it is published? onward.
SECTION E: PRINCIPLE-WISE PERFORMANCE

Principle 1- Businesses should conduct and govern themselves with Ethics, Transparency and
Accountability
(a) Does the policy relating to ethics, bribery and corruption Yes, The “Business Code of Conduct” of the company provides
cover only the company? Yes/No. Does it extend to the guidelines and policies on ethics, bribery and corruption
Group/Joint Ventures/Suppliers/ Contractors/NGOs/ This Code is applicable to all Employees of the company.
Others?
(b) How many stakeholder complaints have been received During the year under review, the Company has not received any
in the past financial year and what percentage was complaints in connection with ethics, bribery or corruption.
satisfactorily resolved by the management? If so, provide
details thereof, in about 50 words or so.
Principle 2: Businesses should provide goods and services that are safe and contribute to
sustainability throughout their life cycle
(a) List up to 3 of your products or services whose design has In Designing & Developing Axles & Brakes to achieve Better
incorporated social or environmental concerns, risks and/or environmental performance is considered as top priority at
opportunities. Automotive Axles Limited (herein after called as “AAL”).
Following are the key Mother Earth Care aspects considered:
a) R&D of Green Axles- Double speed axle to reduce fuel
consumption and also duration to reach the destinations are
reduced.
b) Reduction in exhaust emissions
c) Improved fuel combustion efficiency
d) Reduction in use of dangerous substances in product
manufacturing
e) Enhancement of design for recycling the product after life
cycle
f) Considering the use of recycled materials maximum extent
g) Reduction in ambient noise level with improved Axle Gear
Box components specifications
h) 5s certified company- certified by JUSE, Japan.
68
(b) For each such product, provide the following details in AAL Plant in Mysore has introduced many improvements in Axle
respect of resource use (energy, water, raw material etc.) per & Brakes manufacturing through Mission 2025 strategies. Team
unit of product (optional): working on the improvements related to yield improvements and
other eco-friendly activities indicated below:
(i) Reduction during sourcing / production/distribution
achieved since the previous year throughout the value a) Certified under ISO-14001:2015- Environment
chain Management System & ISO-45001:2018- Occupational
(ii) Reduction during usage by consumers (energy, water) Health & safety Management System
has been achieved since the previous year b) Raw materials optimization by reducing input weight by 8%
for R160V Notch
c) Raw material conservation by reducing input weight by 16%
for housing ring machining stock reducing on both sides
d) Resource conservation by reducing input weight by 4% for 41
Diameter in Brakes Camshaft
e) Natural resource conservation by wood consumption
reduction in all stages of manufacturing
f) Brakes components Yield Improvement from 66% to 88%
g) LPG consumption reduction in Heat Treatment process from
0.32kg/ Kg Material to 0.22Kg /kg of Material Input to
furnaces
h) Raw Water Consumption Reduction from 23 Ltrs/SDLH to
20Lts/SDLH has been achieved through water harvesting and
recycling initiatives
i) With all water conservation initiatives, achieved 40% water
positive status
j) 30% CO2 Emission reduction achieved through Renewable
energy usage- Sources of Energy (Solar, Hydel, Wind) & Tree
plantation
k) Increase in Loading efficiency of truck for FG dispatch to
customer site
l) 100% Elimination of LPG operated forklift by battery
operated forklift to reduce GHG emissions
m) Paint consumption reduction by 15 % by eliminating Manual
painting operation to Robot painting.
n) 30 Kwh solar panel installed in brakes plant roof top.
o) VFD provision for all high running motors & Utility
Equipment’s
p) 250W Metal Halide Lamps replaced with 150W induction
lamps- Energy conservation by 47%.
q) Provisions for 100% Natural light entry during day plant
operation
(c) Does the company have procedures in place for sustainable Yes,
sourcing (including transportation)? If yes, what percentage
of your inputs was sourced sustainably? Also, provide AAL has developed intelligent and environmentally sustainable
details thereof, in about 50 words or so. Logistics systems.
The wooden pallets used for packing of Finished Goods
is replace with metal based reusable & returnable pallets
resulting to 60% elimination of Wooden Pallets Packaging
and also improving the transportation quality.
Rail transport-long chassis trucks are always given preference
for transporting finished goods, which is technically and
economically feasible.
Ensuring truck maximum capacity in all areas of supply chain
management.
69
(d) Has the company taken any steps to procure goods 90%+ Vendor based finish & semi-finish components developed
and services from local & small producers, including locally thereby increasing the efficiency and optimizing the total
communities surrounding their place of work? logistics.
If yes, what steps have been taken to improve their capacity AAL has funded to all Strategic Machining Suppliers to improve
and capability of local and small vendors? and increase their capacity and capability, also following steps
taken to improve further:
On Site Vendor base establishment for major components
manufacturing & supplying & complying with Just In Time-JIT
Educating and Training the Suppliers / Vendors on the ISO
standards
Critical suppliers being audited on periodical basis on their
commitment, Safety, Health & Quality aspects.
Insisting Tier-1, Tier-2 Suppliers to take actions on reducing
waste, CO2 Emissions reduction and towards sustainability.
Providing technical support to vendors and providing
technological assistance to improve their capabilities and
enhancing their capacity.
(e) Does the company have a mechanism to recycle products At Customer End:
and waste? If yes what is the percentage of recycling of Guide lines to customers about eco-friendly re-cycle methods
products and waste (separately as <5%, 5-10%, >10%). for axle waste handling. Instructions includes removing of the oil
Also, provide details thereof, in about 50 words or so. contents from end of life axles, Metals, Rubber, Plastics and other
non-biodegradable parts are to be segregated and to be recycled
without environmental pollution.
At AAL – Mysuru
100% Sewage water is recycled in sewage treatment plant &
reused for urinals flushing & gardening purpose
100% process effluent water is recycled in Effluent treatment
plant & reused for gardening purpose
100% Sewage treatment plant sludge is reused for gardening
activity
100% Garden waste generated are recycled by vermi
composting & manure is reused for gardening activity
100% of hazardous waste sent to authorized recyclers.
100% Brake shoe liner grinding dust is sent to Cement
industries for Co processing
Packing waste materials (cartoon boxes, papers, plastic) are
disposed to authorized recyclers
40% Wood Consumption Elimination reduced across the
plant by providing Reusable Metal stillages
100% Saw Dust eliminated with alternate reusable
absorbents for accidental spills recovery – reducing
generation of Hazardous waste
All types of Non Hazardous solid waste are being disposed
to authorized recyclers
70
Principle 3: Businesses should promote the wellbeing of all employees

(a) Please indicate the Total number of employees 386 (Management Staff)
643 (Workmen)
Total Permanent Employees : 1029
(b) Please indicate the Total number of employees hired on 660
temporary/contractual/casual basis.
(c) Please indicate the Number of permanent women 23
employees
(d) Please indicate the Number of permanent employees with 3 workmen (Dumb)
disabilities 2 workmen (Deaf)
(e) Do you have an employee association that is recognized by Yes
management
(f) What percentage of your permanent employees is members Approximately, 62% of permanent employees are members of
of this recognized employee association? the recognized employee association
(g) Please indicate the Number of complaints relating to child Sr. No. Category No. of No. of complaints
labour, forced labour, involuntary labour, sexual harassment complaints pending as on end
in the last financial year and pending, as on the end of the filed during the of the financial
financial year. financial year year
(i) Child labour/ NIL NIL
forced labour/
involuntary
labour
(ii) Sexual NIL NIL
harassment
(iii) Discriminatory NIL NIL
employment
(h) What percentage of your under mentioned employees were (i) Permanent Employees – 100%
given safety & skill upgradation training in the last year? (ii) Permanent Women Employees – 100%
(iii) Casual/Temporary/Contractual Employees – 100%
(iv) Employees with Disabilities – 100%
Principle 4: Businesses should respect the interests of, and be responsive towards all stakeholders,
especially those who are disadvantaged, vulnerable and marginalized.
(a) Has the company mapped its internal and external Yes, the principal stakeholders of the Company are its employees,
stakeholders? Yes/No shareholders, suppliers, customers, vendors, JV partners,
government and regulatory authorities, trade union, general
public etc. These stakeholders are mapped in a structured
manner through systematic communication platforms which
helps us to understand the customer needs and the improvement
opportunities for the Company in all prospects.
(b) Out of the above, has the company identified the Among the General public, the Company has identified the
disadvantaged, vulnerable & marginalized stakeholders disadvantaged, vulnerable & marginalized group for whom the
Company provides support for their sustenance.
71
(c) Are there any special initiatives taken by the company Yes, several initiatives have been taken by the Company like :
to engage with the disadvantaged, vulnerable and (i) We provide basic educational infrastructure to nearby Govt.
marginalized stakeholders? If so, provide details thereof, in schools like Libraries, LED bulbs, face up-lift of the schools
about 50 words or so. etc., to create an educational ambience.
(ii) We focus on providing skill development programs to increase
the employability of the working class.
(iii) We provide mid-day meals to the inmates of the nearby house
for destitute and ensure their basic needs are met with.
(iv) Our prime focus being the health & sanitation issue, we have
provided world-class Public Convenience Facilities to the
general public in tourist spots.
(v) To support the wellbeing of the general public, we develop
and maintain the nearby public parks, plant saplings, renovate
and maintain lakes.
Principle 5: Businesses should respect and promote human rights

(a) Does the policy of the company on human rights cover The Company does not have a stand-alone policy for human
only the company or extend to the Group/Joint Ventures / rights, however, the Company’s internal policies on Code of
Suppliers/Contractors/NGOs/Others? Conduct, Ethics and CSR recognizes all the key aspects of human
rights which lays down the acceptable behavior of the employees
and provides for stringent disciplinary actions in case of violation
of these policies.
(b) How many stakeholder complaints have been received in During the year under review, the Company has not received any
the past financial year and what percent was satisfactorily complaints from any stakeholders.
resolved by the management?
Principle 6: Business should respect, protect and make efforts to restore the environment
The Company believes in safeguarding the environment while executing its operations. The Company ensures to do business
with the minimum environmental impact. The aim is of rational use of natural resources & reduced waste emissions.
(a) Does the policy related to Principle 6 cover only the Yes, Company’s environmental policy extends to its all interested
company or extends to the Group /Joint ventures / parties which include company employees, group companies,
Suppliers /Contractors /NGOs/others Customer, suppliers, Contractors, General public, related Govt.
Agencies and others.
(b) Does the company have strategies / initiatives to address Yes, As part of Go-Green Key Initiatives to contribute towards
global environmental issues such as climate change, reducing carbon footprint and ensuring sustainability across
global warming, etc.? Y/N. If yes, please give hyperlink for all operations, the Company focuses on various initiatives like:
webpage etc. using Solar Power, modern regenerative combustion technology
for all furnaces, recycled water usage for gardening, reduced
hazardous waste generation with recycle & recovery & adoption
of eco-friendly waste disposal, implementation of scientific
tree plantation to reduce atmospheric pollution etc. in its
manufacturing operations.
Webpage : Status updation under progress
72
(c) Does the company identify and assess potential Yes, Environmental risks are covered in the Company’s principles
environmental risks? Y/N that are based on ISO-14001:2015 standards. Every unit or
plant implements the following:
(i) EHS risks and opportunities implemented through
Management Program;
(ii) Identification and evaluation of EHS aspects and
requirements;
(iii) Legal obligations and other requirements;
(iv) EHS emergency management; and
Once risks are identified, steps are taken to measure and

mitigate these risks through EHS management system approach,
certified under ISO-14001:2015-EMS.
(d) Does the company have any project related to Clean Yes, the Company continues to work towards development and
Development Mechanism? If so, provide details thereof, implementation of climate change mitigation project mainly
in about 50 words or so. Also, if Yes, whether any through energy saving projects, water saving, LPG consumption
environmental compliance report is filed? reduction, waste reduction & CO2 reduction under sustainability
development. However, we don’t have any registration for CDM
projects.
(e) Has the company undertaken any other initiatives on – Yes, several initiatives on clean technology, energy efficient
clean technology, energy efficiency, renewable energy, etc. electrical appliances, Induction lamps, Led lightings, Roof
Y/N. If yes, please give hyperlink for web page etc. Top Turbo Ventilators renewable energy and sustainability
development has been done like Solar power activities are
initiated.
Webpage : Status updation under progress
(f) Are the Emissions/Wastes generated by the company within Yes, all emissions / waste generated are monitored daily /
the permissible limits given by CPCB/SPCB for the financial monthly / quarterly and ensured for within the permissible limit as
year being reported? per KSPCB Consent norms.
(g) Number of show cause / legal notices received from CPCB/ NIL
KSPCB which are pending (i.e. not resolved to satisfaction)
as on end of Financial Year
Principle 7: Businesses, when engaged in influencing public and regulatory policy, should do so
in a responsible manner
(a) Is your company a member of any trade and chamber or The Company is member of:
association? If Yes, Name only those major ones that your 1. Confederation of Indian Industry (CII);
business deals with: 2. Automotive Component Manufacturers Association of India
(ACMA)
(b) Have you advocated/lobbied through above associations From time to time, the Company has joined hands with these
for the advancement or improvement of public good? Yes/ associations for the betterment and advancement of the society at
No; if yes specify the broad areas (drop box: Governance large. The Company has contributed in the areas of:-
and Administration, Economic Reforms, Inclusive (i) economic reforms
Development Policies, Energy security, Water, Food Security, (ii) corporate governance and transparency
Sustainable Business Principles, Others) (iii) education and skill development
(iv) women empowerment and child welfare
(v) sanitation and hygiene
(vi) Addressing issues pertaining to global warming, climate
change, environment protection and pollution control.
73
Principle 8: Businesses should support inclusive growth and equitable development.

(a) Does the company have specified programmes/initiatives/ The details of the Projects undertaken by the Company are as
projects in pursuit of the policy related to Principle 8? If yes under:
details thereof Environment Sustenance:
Having greater interest towards driving environment sustainability,
we have undertaken the responsibility of developing nearby
parks to our factory and parks in tourist spots along with the
responsibility to maintain the Parks.
Revival of nearby lake making Water positive which led to

increase in Water storage capacity from 12.5 to 46 Thousand Cubic
Meters and ground water level increased from 20 to 35% and the
surrounding bore wells yield increased from 0.6 to 2 Meters.
Tree Plantation Drive - We have planted around 3500
saplings at various locations in Mysuru and also ensured their
sustainability by putting tree guard mesh.
Promoting Skill Development :

In association with JSS University, employment enhancing
vocation skills development program is being provided to the
needy section of the society.
Promoting Culture :
Mysuru Dasara is a world renowned cultural program for which
we made our contributions to promote the local culture.
Contribution towards PM CARES Fund :

At a time when the whole world was struck with COVID-19
pandemic we could do our best by contributing towards the PM’s
CARES Fund.
Eradicating hunger, poverty and malnutrition :

We have taken the responsibility to feed mid-day meal through
our factory canteen to a nearby home for the destitute for whom
we had earlier re-built the house which was in a dilapidated
condition.
(b) Are the programmes/projects undertaken through in- The Company has separate in-house team for CSR activities
house team/own foundation / external NGO/government to plan, implement, monitor and review various community
structures/any other organization? development initiatives. The Company believes in a participatory
approach towards implementing these initiatives and collaborates
with CII, NGOs, Government authorities/ agencies to deliver the
Programmes/ Projects.
(c) Have you done any impact assessment of your initiative? Yes, we have undertaken the impact assessment for most of our
projects.
(d) What is your company’s direct contribution to community During the year, the Company has spent `25.26 million towards
development projects - Amount in INR and the details of the various CSR activities. The project wise details are provided in
projects undertaken Annexure - G of Annual Report on CSR activities.
(e) Have you taken steps to ensure that this community Yes, we do a periodic assessments to ensure that the benefits
development initiative is successfully adopted by the of our development initiatives are being fully utilized by the
community? Please explain in 50 words, or so. Community for which they are being provided.
74
Principle 9: Businesses should engage with and provide value to their customers and consumers in a
responsible manner
(a) What percentage of customer complaints/consumer cases No Customer Complaints/No consumer cases till end of
are pending as on the end of financial year? FY 2019-20.
(b) Does the company display product information on the Yes, Since the Company’s products are OEM specific and as per
product label, over and above what is mandated as OEM requirements, the Company displays product requirement
per local laws? Yes / No / N.A. / Remarks (additional on packaging as per the requirements of OEM and consistent
information) with applicable laws.
(c) Is there any case filed by any stakeholder against the No
company regarding unfair trade practices, irresponsible
advertising and/or anti-competitive behavior during the last
five years and pending as on end of financial year? If so,
provide details thereof, in about 50 words or so.
(d) Did your company carry out any consumer Survey / Yes
consumer satisfaction trends?
75
Independent Auditor’s Report
To the Members of Automotive Axles Limited the Rules thereunder, and we have fulfilled our other ethical
responsibilities in accordance with these requirements and
Report on the Audit of the Ind AS Financial the Code of Ethics. We believe that the audit evidence we
Statements have obtained is sufficient and appropriate to provide a basis
for our audit opinion on the Ind AS financial statements.
Opinion
We have audited the accompanying Ind AS financial Emphasis of matter
statements of Automotive Axles Limited (“the Company”), We draw attention to Note 32 of the financial statements,
which comprise the Balance sheet as at March 31 2020, describing that the Pandemic COVID-19 would cause
the Statement of Profit and Loss, including the statement of various social and economic disruption impacting supply
Other Comprehensive Income, the Cash Flow Statement chains, consumer demand, commodity prices, personnel
and the Statement of Changes in Equity for the year then available for work and access to offices of the Company.
ended, and notes to the Ind AS financial statements, Our opinion is not modified in respect of this matter.
including a summary of significant accounting policies and
other explanatory information. Key Audit Matters
Key audit matters are those matters that, in our professional
In our opinion and to the best of our information and judgment, were of most significance in our audit of the Ind
according to the explanations given to us, the aforesaid Ind AS financial statements for the financial year ended March
AS financial statements give the information required by the 31, 2020. These matters were addressed in the context of
Companies Act, 2013, as amended (“the Act”) in the manner our audit of the Ind AS financial statements as a whole, and
so required and give a true and fair view in conformity with in forming our opinion thereon, and we do not provide a
the accounting principles generally accepted in India, of the separate opinion on these matters. For the matter mentioned
state of affairs of the Company as at March 31, 2020, its below, our description of how our audit addressed the
profit including other comprehensive income, its cash flows matter is provided in that context.
and the changes in equity for the year ended on that date.
We have determined the matter described below to be
Basis for Opinion the key audit matter to be communicated in our report.
We conducted our audit of the Ind AS financial statements in We have fulfilled the responsibilities described in the
accordance with the Standards on Auditing (SAs), as specified Auditor’s responsibilities for the audit of the Ind AS financial
under section 143(10) of the Act. Our responsibilities under statements section of our report, including in relation to this
those Standards are further described in the ‘Auditor’s matter. Accordingly, our audit included the performance
Responsibilities for the Audit of the Ind AS Financial of procedures designed to respond to our assessment of
Statements’ section of our report. We are independent of the risks of material misstatement of the Ind AS financial
the Company in accordance with the ‘Code of Ethics’ issued statements. The results of our audit procedures, including the
by the Institute of Chartered Accountants of India together procedures performed to address the matter below, provide
with the ethical requirements that are relevant to our audit of the basis for our audit opinion on the accompanying Ind AS
the financial statements under the provisions of the Act and financial statements.
76
Key audit matters How our audit addressed the key audit matter
Inventories (as described in Note 7 of the Ind AS financial statements)
We have identified valuation of inventories as a key audit Our audit procedures in relation to identification of slow moving/
matter due to the critical judgement exercised by the Company’s non-moving and obsolete inventory included the following:
management in identifying the obsolete inventories as a result of We have obtained the evaluation from management on the
technological and regulatory changes in the automotive sector usability of existing inventories as a result of technological
on transition to BS-VI norms and slow-moving/non-moving and regulatory changes in the automotive sector on
items of inventories and assessing the amount of allowance for transition to BS-VI norms and related allowances for slow
inventories. moving/ non-moving and obsolete inventory.
We understood and evaluated the basis of identification
The gross balance of inventories as at March 31, 2020 is INR of the obsolete inventories and slow-moving/non-moving
1,624.64 million, against which provision amounting to INR inventories;
64.61 million was made. Inventories comprise Raw material, We tested the accuracy of the report on aged inventories, on
Work in progress, finished products and stores and spares. a sample basis.
We evaluated the historical accuracy of allowance for
The determination of provision in respect of inventories requires inventories by comparing the actual loss on account of
management to exercise judgment in identifying slow-moving/ write off of slow moving/ obsolete inventory to the historical
non-moving and obsolete stocks pursuant to technological and allowance recognized.
regulatory changes and make estimates of the appropriate level
We have tested the utilisation pattern of the aged inventory
of provision required.
on a sample basis.
We assessed the realizable value, on a sample basis, by
Due to lockdown restrictions, inventory verification was
comparing the inventory value with the subsequent sales
performed subsequent to year end after the restrictions were
prices of the finished goods.
relaxed. As it was impracticable for people to travel, including
Understood Company’s internal control environment over
the audit team, alternative procedures were performed in
receipts, consumption and dispatch of inventories and
respect of Physical verification of inventories.
controls over the physical count of inventories.
We have performed procedures related to physical count
of inventories through assistance from a third-party
independent auditor (Chartered Accountant) under our
supervision in accordance with of SA 501 (Revised) Audit
Evidence – Specific Considerations for Selected Items
Rolled back the stock as on date of stock count to March
31, 2020 and performed analytical procedures on quantity
of stock as on March 31, 2020.
We have determined that there are no other key audit Our opinion on the Ind AS financial statements does not
matters to communicate in our report. cover the other information and we do not express any form
of assurance conclusion thereon.
Information Other than the Financial Statements
and Auditor’s Report Thereon In connection with our audit of the Ind AS financial
The Company’s Board of Directors is responsible for the statements, our responsibility is to read the other information
other information. The other information comprises the and, in doing so, consider whether such other information
information included in the Annual report, but does not is materially inconsistent with the financial statements or
include the Ind AS financial statements and our auditor’s our knowledge obtained in the audit or otherwise appears
report thereon. to be materially misstated. If, based on the work we have
performed, we conclude that there is a material misstatement
77
of this other information, we are required to report that fact. As part of an audit in accordance with SAs, we exercise
We have nothing to report in this regard. professional judgment and maintain professional skepticism
throughout the audit. We also:
Responsibilities of Management for the Ind AS
Financial Statements Identify and assess the risks of material misstatement
The Company’s Board of Directors is responsible for the of the Ind AS financial statements, whether due to
matters stated in section 134(5) of the Act with respect to fraud or error, design and perform audit procedures
the preparation of these Ind AS financial statements that responsive to those risks, and obtain audit evidence
give a true and fair view of the financial position, financial that is sufficient and appropriate to provide a basis
performance including other comprehensive income, cash for our opinion. The risk of not detecting a material
flows and changes in equity of the Company in accordance misstatement resulting from fraud is higher than for one
with the accounting principles generally accepted in India, resulting from error, as fraud may involve collusion,
including the Indian Accounting Standards (Ind AS) specified forgery, intentional omissions, misrepresentations, or
under section 133 of the Act read with the Companies the override of internal control.
(Indian Accounting Standards) Rules, 2015, as amended.
This responsibility also includes maintenance of adequate Obtain an understanding of internal control relevant to
accounting records in accordance with the provisions of the audit in order to design audit procedures that are
the Act for safeguarding of the assets of the Company and appropriate in the circumstances. Under section 143(3)
for preventing and detecting frauds and other irregularities; (i) of the Act, we are also responsible for expressing
selection and application of appropriate accounting policies; our opinion on whether the Company has adequate
making judgments and estimates that are reasonable and internal financial controls with reference to financial
prudent; and the design, implementation and maintenance statements in place and the operating effectiveness of
of adequate internal financial controls, that were operating such controls.
effectively for ensuring the accuracy and completeness of
the accounting records, relevant to the preparation and
Evaluate the appropriateness of accounting policies
presentation of the Ind AS financial statements that give a used and the reasonableness of accounting estimates
true and fair view and are free from material misstatement, and related disclosures made by management.
whether due to fraud or error.

Conclude on the appropriateness of management’s
In preparing the Ind AS financial statements, management is use of the going concern basis of accounting and,
responsible for assessing the Company’s ability to continue based on the audit evidence obtained, whether
as a going concern, disclosing, as applicable, matters a material uncertainty exists related to events or
related to going concern and using the going concern conditions that may cast significant doubt on the
basis of accounting unless management either intends to Company’s ability to continue as a going concern. If
liquidate the Company or to cease operations, or has no we conclude that a material uncertainty exists, we are
realistic alternative but to do so. required to draw attention in our auditor’s report to the
related disclosures in the financial statements or, if such
Those Board of Directors are also responsible for overseeing disclosures are inadequate, to modify our opinion. Our
the Company’s financial reporting process. conclusions are based on the audit evidence obtained
up to the date of our auditor’s report. However, future
Auditor’s Responsibilities for the Audit of the Ind events or conditions may cause the Company to cease
AS Financial Statements to continue as a going concern.
Our objectives are to obtain reasonable assurance about
whether the Ind AS financial statements as a whole are free Evaluate the overall presentation, structure and content
from material misstatement, whether due to fraud or error, of the Ind AS financial statements, including the
and to issue an auditor’s report that includes our opinion. disclosures, and whether the Ind AS financial statements
Reasonable assurance is a high level of assurance, but is represent the underlying transactions and events in a
not a guarantee that an audit conducted in accordance manner that achieves fair presentation.
with SAs will always detect a material misstatement when it
exists. Misstatements can arise from fraud or error and are We communicate with those charged with governance
considered material if, individually or in the aggregate, they regarding, among other matters, the planned scope and
could reasonably be expected to influence the economic timing of the audit and significant audit findings, including
decisions of users taken on the basis of these Ind AS financial any significant deficiencies in internal control that we identify
statements. during our audit.
78
We also provide those charged with governance with a (e)

On the basis of the written representations
statement that we have complied with relevant ethical received from the directors as on March 31, 2020
requirements regarding independence, and to communicate taken on record by the Board of Directors, none
with them all relationships and other matters that may of the directors is disqualified as on March 31,
reasonably be thought to bear on our independence, and 2020 from being appointed as a director in terms
where applicable, related safeguards. of Section 164 (2) of the Act;
From the matters communicated with those charged with (f)

With respect to the adequacy of the internal
governance, we determine those matters that were of most financial controls over financial reporting of the
significance in the audit of the Ind AS financial statements Company with reference to these Ind AS financial
for the financial year ended March 31, 2020 and are statements and the operating effectiveness of such
therefore the key audit matters. We describe these matters controls, refer to our separate Report in “Annexure
in our auditor’s report unless law or regulation precludes 2” to this report;
public disclosure about the matter or when, in extremely
rare circumstances, we determine that a matter should (g) In our opinion, the managerial remuneration for
not be communicated in our report because the adverse the year ended March 31, 2020 has been paid
consequences of doing so would reasonably be expected to / provided by the Company to its directors in
outweigh the public interest benefits of such communication. accordance with the provisions of section 197
read with Schedule V to the Act;
Report on Other Legal and Regulatory
Requirements (h) With respect to the other matters to be included in
1. As required by the Companies (Auditor’s Report) Order, the Auditor’s Report in accordance with Rule 11 of
2016 (“the Order”), issued by the Central Government the Companies (Audit and Auditors) Rules, 2014,
of India in terms of sub-section (11) of section 143 of as amended in our opinion and to the best of our
the Act, we give in the “Annexure 1” a statement on the information and according to the explanations
matters specified in paragraphs 3 and 4 of the Order. given to us:
2. As required by Section 143(3) of the Act, we report i. The Company does not have any pending
that: litigations which would impact its financial
position;
(a) We have sought and obtained all the information
and explanations which to the best of our ii. The Company did not have any long-term
knowledge and belief were necessary for the contracts including derivative contracts for
purposes of our audit; which there were any material foreseeable
losses;
(b)
In our opinion, proper books of account as
required by law have been kept by the Company iii.
There has been no delay in transferring
so far as it appears from our examination of those amounts, required to be transferred, to the
books; Investor Education and Protection Fund by the
Company.
(c) The Balance Sheet, the Statement of Profit and Loss
including the Statement of Other Comprehensive For S.R. Batliboi & Associates LLP
Income, the Cash Flow Statement and Statement Chartered Accountants
of Changes in Equity dealt with by this Report are ICAI Firm Registration Number: 101049W/E300004
in agreement with the books of account;
(d)
In our opinion, the aforesaid Ind AS financial per Rajeev Kumar
statements comply with the Accounting Standards Partner
specified under Section 133 of the Act, read with Membership Number: 213803
Companies (Indian Accounting Standards) Rules, UDIN: 20213803AAAABK2272
2015, as amended;
Place of Signature: Bengaluru
Date: May 26, 2020
79
Annexure 1 referred to in paragraph 1 under the heading “Report on Other Legal and Regu-
latory Requirements” of our report of even date
Re: Automotive Axles Limited (‘the Company’) Accordingly, the provisions of clause 3(v) of the Order are
not applicable.
(i) (a) The Company has maintained proper records showing
full particulars, including quantitative details and situation (vi) We have broadly reviewed the books of account
of property, plant and equipment. maintained by the Company pursuant to the rules made
by the Central Government for the maintenance of cost
(b) All property, plant and equipment have not been physically records under Section 148(1) of the Companies Act, 2013,
verified by the management during the year but there is a related to the manufacture of axles and brakes, and are
regular programme of verification which, in our opinion, of the opinion that prima facie, the specified accounts and
is reasonable having regard to the size of the Company records have been made and maintained. We have not,
and the nature of its assets. No material discrepancies were however, made a detailed examination of the same.
noticed on such verification.
(vii) (a) The Company is generally regular in depositing
(c) According to the information and explanations given by with appropriate authorities undisputed statutory dues
the management, the title deeds of immovable properties including provident fund, employees’ state insurance,
included in property, plant and equipment are held in the income-tax, duty of custom, goods and services tax, cess
name of the company. and other statutory dues applicable to it. Also, Refer Note
37(A) to the financial statements with regards to provident
(ii) Due to outbreak of COVID-19 and lock down fund dues.
restrictions imposed by the Government, the management
has conducted physical verification of inventory subsequent (b) According to the information and explanations given to
to the year-end covering certain class of inventories. us, no undisputed amounts payable in respect of provident
Discrepancies noted on physical verification of inventories fund, employees’ state insurance, income-tax, duty of
have been properly dealt with in the books of account. In custom, goods and services tax, cess and other statutory
our opinion, the frequency and the coverage of the inventory dues were outstanding, at the year end, for a period of more
verification needs to be further strengthened. than six months from the date they became payable. Also,
Refer Note 37(A) to the financial statements with regards to
(iii) According to the information and explanations given provident fund dues.
to us, the Company has not granted any loans, secured or
unsecured to companies, firms, Limited Liability Partnerships
or other parties covered in the register maintained under (c) According to the information and explanation given
Section 189 of the Companies Act, 2013. Accordingly, the to us, there are no dues of income tax, sales-tax, service
provisions of clause 3(iii)(a), (b) and (c) of the Order are not tax, custom duty, excise duty, value added tax, goods and
applicable to the Company. services tax and cess which have not been deposited on
account of any dispute.
(iv) In our opinion and according to the information and
explanations given to us, there are no loans, investments, (viii) In our opinion and according to the information and
guarantees, and securities given in respect of which explanations given by the management, the Company has
provisions of Section 185 of the Companies Act, 2013 apply. not defaulted in repayment of loans or borrowings to bank
The Company has given loans which are in compliance with or dues to a financial institution. The Company did not have
the provisions of Section 186 of the Companies Act, 2013. any outstanding dues to debenture holders or government
during the year.
(v) The Company has not accepted any deposits within the
meaning of Sections 73 to 76 of the Act and the Companies (ix) In our opinion and according to the information and
(Acceptance of Deposits) Rules, 2014 (as amended). explanations given by the management, the Company
80
has utilized the monies raised by way of term loans for the (xiv) According to the information and explanations given to
purposes for which they were raised. The Company has not us and on an overall examination of the balance sheet, the
raised any money by way of initial public offer or further company has not made any preferential allotment or private
public offer (including debt instruments). placement of shares or fully or partly convertible debentures
during the year under review and hence, reporting
(x) Based upon the audit procedures performed for requirements under clause 3(xiv) are not applicable to the
the purpose of reporting the true and fair view of the company.
financial statements and according to the information and
explanations given by the management, we report that no (xv) According to the information and explanations given
fraud by the company or no fraud on the company by the by the management, the Company has not entered into any
officers and employees of the Company has been noticed or non-cash transactions with directors or persons connected
reported during the year. with him as referred to in Section 192 of Companies Act,
2013.
(xi) According to the information and explanations given by
the management, the managerial remuneration has been (xvi) According to the information and explanations given
paid / provided in accordance with the requisite approvals to us, the provisions of Section 45-IA of the Reserve Bank of
mandated by the provisions of Section 197 read with India Act, 1934 are not applicable to the Company.
Schedule V to the Companies Act, 2013.
(xii) In our opinion, the Company is not a nidhi company. For S.R. Batliboi & Associates LLP
Therefore, the provisions of clause 3(xii) of the order are Chartered Accountants
not applicable to the Company and hence not commented ICAI Firm Registration Number: 101049W/E300004
upon.
(xiii) According to the information and explanations given by per Rajeev Kumar
the management, transactions with the related parties are in Partner
compliance with Section 177 and 188 of Companies Act, Membership Number: 213803
2013 where applicable and the details have been disclosed UDIN: 20213803AAAABK2272
in the notes to the financial statements, as required by the
applicable accounting standards. Place of Signature: Bengaluru
Date: May 26, 2020
81
Annexure 2 to the Independent Auditor’s Report of even date on the financial statements of
Automotive Axles Limited
Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of
the Companies Act, 2013 (“the Act”)
We have audited the internal financial controls over financial Our audit involves performing procedures to obtain audit
reporting of Automotive Axles Limited (“the Company”) as evidence about the adequacy of the internal financial
of March 31, 2020 in conjunction with our audit of the controls over financial reporting with reference to these
financial statements of the Company for the year ended on financial statements and their operating effectiveness. Our
that date. audit of internal financial controls over financial reporting
included obtaining an understanding of internal financial
Management’s Responsibility for Internal controls over financial reporting with reference to these
Financial Controls financial statements, assessing the risk that a material
The Company’s Management is responsible for establishing weakness exists, and testing and evaluating the design
and maintaining internal financial controls based on the and operating effectiveness of internal control based on
internal control over financial reporting criteria established the assessed risk. The procedures selected depend on the
by the Company considering the essential components auditor’s judgement, including the assessment of the risks of
of internal control stated in the Guidance Note on Audit material misstatement of the financial statements, whether
of Internal Financial Controls Over Financial Reporting due to fraud or error.
issued by the Institute of Chartered Accountants of India.
These responsibilities include the design, implementation We believe that the audit evidence we have obtained is
and maintenance of adequate internal financial controls sufficient and appropriate to provide a basis for our audit
that were operating effectively for ensuring the orderly and opinion on the internal financial controls over financial
efficient conduct of its business, including adherence to reporting with reference to these financial statements.
the Company’s policies, the safeguarding of its assets, the
prevention and detection of frauds and errors, the accuracy Meaning of Internal Financial Controls Over
and completeness of the accounting records, and the timely Financial Reporting With Reference to these
preparation of reliable financial information, as required Financial Statements
under the Companies Act, 2013. A company’s internal financial control over financial
reporting with reference to these financial statements is
Auditor’s Responsibility a process designed to provide reasonable assurance
Our responsibility is to express an opinion on the regarding the reliability of financial reporting and the
Company’s internal financial controls over financial preparation of financial statements for external purposes in
reporting with reference to these financial statements based accordance with generally accepted accounting principles. A
on our audit. We conducted our audit in accordance with company’s internal financial control over financial reporting
the Guidance Note on Audit of Internal Financial Controls with reference to these financial statements includes those
Over Financial Reporting (the “Guidance Note”) and the policies and procedures that (1) pertain to the maintenance
Standards on Auditing as specified under section 143(10) of records that, in reasonable detail, accurately and fairly
of the Companies Act, 2013, to the extent applicable to an reflect the transactions and dispositions of the assets of the
audit of internal financial controls and, both issued by the company; (2) provide reasonable assurance that transactions
Institute of Chartered Accountants of India. Those Standards are recorded as necessary to permit preparation of
and the Guidance Note require that we comply with ethical financial statements in accordance with generally accepted
requirements and plan and perform the audit to obtain accounting principles, and that receipts and expenditures
reasonable assurance about whether adequate internal of the company are being made only in accordance
financial controls over financial reporting with reference to with authorisations of management and directors of the
these financial statements was established and maintained company; and (3) provide reasonable assurance regarding
and if such controls operated effectively in all material prevention or timely detection of unauthorised acquisition,
respects. use, or disposition of the company’s assets that could have
a material effect on the financial statements.
82
Inherent Limitations of Internal Financial financial controls over financial reporting with reference
Controls Over Financial Reporting with reference to these financial statements were operating effectively as
to these Financial Statements at March 31, 2020, based on the internal control over
Because of the inherent limitations of internal financial financial reporting criteria established by the Company
controls over financial reporting with reference to these considering the essential components of internal control
financial statements, including the possibility of collusion stated in the Guidance Note on Audit of Internal Financial
or improper management override of controls, material Controls Over Financial Reporting issued by the Institute of
misstatements due to error or fraud may occur and not be Chartered Accountants of India.
detected. Also, projections of any evaluation of the internal
financial controls over financial reporting with reference to For S.R. Batliboi & Associates LLP
these financial statements to future periods are subject to the Chartered Accountants
risk that the internal financial control over financial reporting ICAI Firm Registration Number: 101049W/E300004
with reference to these financial statements may become
inadequate because of changes in conditions, or that the
degree of compliance with the policies or procedures may per Rajeev Kumar
deteriorate. Partner
Membership Number: 213803
Opinion UDIN: 20213803AAAABK2272
In our opinion, the Company has, in all material respects,
adequate internal financial controls over financial reporting Place of Signature: Bengaluru
with reference to these financial statements and such internal Date: May 26, 2020
83
Balance
as at March 31 2020
Sheet
(All amounts in Indian Rupees Millions, unless otherwise stated)
Notes March 31, 2020 March 31, 2019
ASSETS
Non-current assets
Property, plant and equipment 3 2,307.23 1,084.59
Capital work in progress 3 240.64 1,154.96
Intangible assets 4 6.08 3.86
Right-of-use assets 34 240.37 -
Financial assets
Loans 5 67.50 20.24
Other financial assets 5 151.11 38.77
Other non-current assets 6 77.28 445.52
Deferred tax assets (net) 20 100.42 147.98
3,190.63 2,895.92
Current assets
Inventories 7 1,560.03 1,843.70
Financial assets
Loans 5 43.67 63.71
Trade receivables 8 1,227.33 3,463.28
Cash and cash equivalents 9 737.34 397.41
Other bank balances 10 2.71 2.47
Other financial assets 5 97.36 244.12
Other current assets 6 425.83 422.11
4,094.27 6,436.80
Total assets 7,284.90 9,332.72
EQUITY AND LIABILITIES
Equity
Equity share capital 11 151.12 151.12
Other equity 12 5,168.25 5,233.28
Total equity 5,319.37 5,384.40
Liabilities
Non-current liabilities
Financial liabilities
Borrowings 15 187.50 659.03
Lease liabilities 34 107.41 -
Other non-current liabilities 16 - 6.78
Provisions 17 87.02 70.01
381.93 735.82
Current liabilities
Financial liabilities
Lease liabilities 34 16.58 -
Trade payables 18
(A) Total outstanding dues of micro enterprises and small enterprises 34.76 119.18
(B) Total outstanding dues of creditors other than micro enterprises and small enterprises 1,110.85 2,460.35
Other financial liabilities 15 183.12 182.01
Other current liabilities 16 45.58 243.49
Provisions 17 166.59 169.78
Current tax liabilities (net) 19 26.12 37.69
1,583.60 3,212.50
Total liabilities 1,965.53 3,948.32
Total equity and liabilities 7,284.90 9,332.72
Summary of significant accounting policies (refer note 2)
The accompanying notes are an integral part of the financial statements.
As per our report of even date
For S.R. Batliboi & Associates LLP For and on behalf of the Board of Directors of
Chartered Accountants Automotive Axles Limited
ICAI Firm Registration Number: 101049W/E300004
per Rajeev Kumar Kumaradevan Srinivasan Dr. B. N. Kalyani Ranganathan S
Partner Senior Vice President & Chairman Chief Financial Officer
Membership No.: 213803 Whole time Director DIN: 00089380 Place : Mysuru
Place : Bengaluru DIN: 08107660 Place : Pune Date : May 26, 2020
Date : May 26, 2020 Place : Mysuru Date : May 26, 2020
Date : May 26, 2020
Debadas Panda
Company Secretary
Place : Mysuru
Date : May 26, 2020
84
Statement of Profit and Loss

for the year ended March 31, 2020
Year ended Year ended
Notes
March 31, 2020 March 31, 2019
Income
Revenue from operations 21 9,519.58 19,390.42
Other income 22 77.23 29.60
Total income 9,596.81 19,420.02
Expenses
Cost of materials consumed 23 6,266.66 13,796.11
Changes in inventories of finished goods, stock-in-trade and work-in-progress 24 188.91 (347.53)
Employee benefits expense 25 890.90 1,235.14
Depreciation and amortisation expense 26 372.22 461.86
Finance costs 27 18.07 5.49
Other expenses 28 1,240.27 2,415.84
Total expense 8,977.03 17,566.91
Profit before tax/exceptional items 619.78 1,853.11
Exceptional items income/(loss) (20.24) -
Profit before tax 29 599.54 1,853.11
Tax expenses
Current tax 20 147.13 711.40
Tax expenses relating to prior years 20 (11.82) -
Deferred tax charge / (credit) 20 52.89 (73.79)
Total expenses 188.20 637.61
Profit for the year 411.34 1,215.50
Other comprehensive income/ (loss) (OCI)
Other comprehensive income/ (loss) not to be reclassified to profit or loss in
subsequent periods:
Remeasurement (loss) on items that will not be reclassified to statement of profit or 37 (6.73) (43.82)
loss on defined benefit plans
Income tax effect on above 20 1.69 15.31
Other comprehensive income/ (loss) for the year, net of tax (5.04) (28.51)
Total comprehensive income for the year 406.30 1,186.99

Earnings per equity share [nominal value of share INR 10 (March 31, 2019: INR 10)]
Basic and diluted (in Rupees) 31 27.22 80.43
Summary of significant accounting policies 2
Date : May 26, 2020
Debadas Panda
Company Secretary
Place : Mysuru
Date : May 26, 2020
85
Statement of Changes in Equity

a) Equity share capital

Equity shares of INR 10 each issued, subscribed and fully paid
Numbers INR
As at April 1, 2018 1,51,11,975 151.12
Issued during the year - -
As at March 31, 2019 1,51,11,975 151.12
Issued during the year - -
As at March 31, 2020 1,51,11,975 151.12
b) Other equity
Attributable to equity holders of the Company

Reserves & surplus
Securities Retained
General reserves Total
premium earnings
Balance as at April 1, 2018 115.59 458.82 3,717.82 4,292.23

Profit for the year - - 1,215.50 1,215.50
Other comprehensive income/ (loss) - - (28.51) (28.51)
Dividend paid (refer note 14) - - (204.00) (204.00)
Dividend distribution tax - - (41.94) (41.94)
Balance as at March 31, 2019 115.59 458.82 4,658.87 5,233.28
Balance as at April 1, 2019 115.59 458.82 4,658.87 5,233.28
Profit for the year - - 411.34 411.34
Other comprehensive income/ (loss) - - (5.04) (5.04)
Dividend paid (refer note 14) - - (385.36) (385.36)
Dividend distribution tax - - (79.21) (79.21)
Effect of adoption of Ind AS 116 (net of taxes) (refer note 2.3) - - (6.76) (6.76)
Balance as at March 31, 2020 115.59 458.82 4,593.84 5,168.25
Summary of significant accounting policies (Refer Note 2)
Date : May 26, 2020
Debadas Panda
Company Secretary
Place : Mysuru
Date : May 26, 2020
86
Cash Flow Statement

Year ended Year ended
Notes
March 31, 2020 March 31, 2019
I Operating activities
Profit before tax 599.54 1,853.11
Non-cash adjustments to reconcile profit before tax to net cash flows:
Depreciation of property, plant and equipment and right-of-use assets 367.59 460.16
Amortisation of intangible assets 4.63 1.70
Profit on sale of property, plant and equipment (7.73) (1.52)
Provision for doubtful trade receivables/advances (net) - 0.44
Exceptional items 29 20.24 -
Provision for warranty 38.84 149.97
Finance costs (including fair value changes in financial instruments) 17.89 4.03
Finance income (including fair value changes in financial instruments) (56.61) (26.01)
Operating profit before working capital adjustments 984.39 2,441.88
Working capital adjustments :
(Increase)/ decrease in trade receivables 2,235.95 (117.48)
(Increase)/ decrease in loans (0.58) 1.63
(Increase)/ decrease in other financial assets 148.02 (95.24)
(Increase)/ decrease in other assets 69.98 (12.88)
(Increase)/ decrease in inventories 283.67 (472.76)
Increase/ (decrease) in trade payables (1,433.92) 17.53
Increase/ (decrease) in other liabilities (197.91) 50.70
Increase/ (decrease) in other financial liabilities 67.03 (0.43)
Increase/ (decrease) in provisions (31.75) (60.23)
2,124.88 1,752.72
Income tax paid (net of refund) (146.88) (696.63)
Net cash flows from operating activities 1,978.00 1,056.09
II Investing activities
Purchase of property, plant and equipment and right-of-use assets (629.40) (1,524.62)
Proceeds from sale of property, plant and equipment 12.88 6.53
Loans given to suppliers (49.68) (94.20)
Loans repaid by suppliers 23.04 15.46
Interest received 54.03 25.74
Net cash flows used in investing activities (589.13) (1,571.09)
III Financing activities
Proceeds from borrowings - 730.00
Repayment of borrowings (refer note 1 below) (500.83) -
Interest paid (68.54) (13.84)
Payment of principal portion of lease liabilities (refer note 1 below) (15.00) -
Dividend paid to equity holders (385.36) (204.00)
Dividend distribution tax (79.21) (41.94)
Net cash flows from/ (used in) financing activities (1,048.94) 470.22
IV Net increase in cash and cash equivalents (I + II + III) 339.93 (44.78)
Cash and cash equivalents at the beginning of the year 9 397.41 442.19
V Cash and cash equivalents at the end of the year 9 737.34 397.41
Components of cash and cash equivalents as at the end of the year 9
Cash on hand 0.03 0.07
Balances with banks
- in current accounts 77.31 397.34
- in deposit accounts with original maturity of less than three months 660.00 -
Total cash and cash equivalents 737.34 397.41
Summary of significant accounting policies 2
87
Cash Flow Statement

Explanatory notes to statement of cash flows

1. Changes in liabilities arising from financing activities:-
Liabilities arising from financing activities
Long term
Lease liabilities Short term
borrowings
(note 34) borrowings
(note 15)
As at April 01, 2019 130.30 730.00 -
Proceeds from financing activities 8.69 - -
Repayment of financing activities (15.00) (500.83) -
As at March 31, 2020 123.99 229.17 -
As at April 01, 2018 - -

Proceeds from financing activities - 730.00 -
Repayment of financing activities - - -
As at March 31, 2019 - 730.00 -

Date : May 26, 2020
Debadas Panda
Company Secretary
Place : Mysuru
Date : May 26, 2020
88
Notes
To the financial statements for the year ended March 31, 2020
1. Corporate information Held primarily for the purpose of trading

Automotive Axles Limited (“the Company”) is a joint
venture company incorporated in 1981, between Expected to be realised within twelve months
Bharat Forge Limited, Pune, India and Meritor Heavy after the reporting period, or
Vehicle Systems LLC, USA. The Company is a public
company domiciled in India. Its shares are listed on Cash or cash equivalent unless restricted from
the BSE Limited and the National Stock Exchange of being exchanged or used to settle a liability
India Limited. The registered office of the company is for at least twelve months after the reporting
located at Hootagalli Industrial Area, Off Hunsur Road, period
Mysore, Karnataka- 570018. The Company CIN is
L51909KA1981PLC004198. All other assets are classified as non-current.
The Company is primarily engaged in manufacturing of A liability is current when:

Axles and Brakes at Mysore, Rudrapur and Jamshedpur.
It is expected to be settled in normal operating
The financial statements were authorised for issue in cycle
accordance with a resolution of the Company’s Board
of Directors on May 26, 2020 It is held primarily for the purpose of trading
2. Significant accounting policies It is due to be settled within twelve months

2.1 Basis of preparation after the reporting period, or
The financial statements of the Company have been
prepared in accordance with Indian Accounting Standards There is no unconditional right to defer the
(Ind AS) notified under the Companies (Indian Accounting settlement of the liability for at least twelve
Standards) Rules, 2015 (as amended from time to time). months after the reporting period
These financial statements have been prepared on a The Company classifies all other liabilities as non-
historical cost basis as explained in the accounting policies current.
below, except for the following assets and liabilities which
have been measured at fair value: Deferred tax assets and liabilities are classified as
non-current assets and liabilities.
Certain financial assets and liabilities measured at
fair value (refer accounting policy regarding financial The operating cycle is the time between the
instruments) acquisition of assets for processing and their
realisation in cash and cash equivalents. The
The financial statements are presented in Indian Rupees Company has identified twelve months as its
(INR) and all values are rounded to the nearest million operating cycle.
(INR 000,000), except when otherwise indicated.
(b) Foreign currencies
2.2 Summary of significant accounting The financial statements are presented in Indian
policies Rupees (‘INR’), which is the functional currency of
(a) Current versus non-current classification the Company.
(The Company presents assets and liabilities in
the balance sheet based on current/ non-current Transactions and balances
classification. An asset is treated as current when it is: Transactions in foreign currencies are initially
recorded by the Company using spot rates on the
Expected to be realised or intended to be sold date the transaction first qualifies for recognition.
or consumed in normal operating cycle
89
Notes
Monetary assets and liabilities denominated in customer. If the Company performs by transferring
foreign currencies are translated into the relevant goods or services to a customer before the
functional currency at exchange rates at the customer pays consideration or before payment is
reporting date. due, a contract asset is recognised for the earned
consideration that is conditional.
Exchange differences arising on settlement or
translation of monetary items are recognised in the Revenues in excess of invoicing are classified as
statement of profit and loss in the period in which contract assets (which we refer to as Unbilled
they arise. Revenue)
Non- monetary items that are measured in terms of The specific recognition criteria described below
historical cost in a foreign currency are translated must also be met before revenue is recognised.
using the exchange rates at the dates of the initial
transactions. Non-monetary items measured at fair Sale of goods:
value in a foreign currency are translated using the Revenue from sale of goods is recognised at the
exchange rates at the date when the fair value is point in time when control of the asset is transferred
determined. The gain or loss arising on translation to the customer.
of non-monetary items measured at fair value is
treated in line with the recognition of the gain or The revenue is collected immediately upon sale of
loss on the change in fair value of the item (i.e., goods or as per agreed credit terms which is within
translation differences on items whose fair value gain 30 to 60 days upon delivery.
or loss is recognised in OCI or profit or loss are also
recognised in OCI or profit or loss, respectively).
The Company considers whether there are
other promises in the contract that are separate
(c) Revenue from contract with customer performance obligations to which a portion of the
The Company earns revenue from contract with transaction price needs to be allocated.
customer primarily from sale of goods.
Variable Consideration:
Revenue is recognised upon transfer of control Rights of return, volume discounts, or any other
of promised products to customers in an amount form of variable consideration is estimated using
that reflects the consideration which the Company either the sum of probability weighted amounts
expects to receive in exchange for those goods. in a range of possible consideration amounts
The Company has generally concluded that it is (expected value), or the single most likely amount
the principal in its revenue arrangements, because in a range of possible consideration amounts
it typically controls the goods or services before (most likely amount), depending on which method
transferring them to the customer, it is the primary better predicts the amount of consideration
obligor in all the revenue arrangements as it has realizable. Transaction price includes variable
pricing latitude and is also exposed to inventory consideration only to the extent it is probable that
and credit risks. a significant reversal of revenues recognized will
not occur when the uncertainty associated with the

The disclosures of significant accounting variable consideration is resolved. Our estimates
judgements, estimates and assumptions relating of variable consideration and determination of
to revenue from contracts with customers are whether to include estimated amounts in the
provided in Note 32. transaction price may involve judgment and are
based largely on an assessment of our anticipated
Contract assets performance and all information that is reasonably
A contract asset is the right to consideration in available to us.
exchange for goods or services transferred to the
90
Notes
Finance income: Deferred tax

For all financial instruments measured at amortised Deferred tax is provided using the liability method
cost, interest income is recorded using the effective on temporary differences between the tax bases of
interest rate (EIR). EIR is the rate that exactly assets and liabilities and their carrying amounts for
discounts the estimated future cash payments or financial reporting purposes at the reporting date.
receipts over the expected life of the financial
instrument or a shorter period, where appropriate,
Deferred tax assets are recognised for all
to the net carrying amount of the financial asset deductible temporary differences, the carry
or to the amortised cost of a financial liability. forward of unused tax credits and any unused tax
When calculating EIR, the Company estimates losses. Deferred tax assets are recognised to the
the expected cash flows by considering all the extent that it is probable that taxable profit will be
contractual terms of the financial instrument but available against which the deductible temporary
does not consider the expected credit losses. differences, and the carry forward of unused tax
Interest income is included in finance income in credits and unused tax losses can be utilised.
the statement of profit and loss.
The carrying amount of deferred tax assets are
Dividend income: reviewed at each reporting date and reduced to the
Revenue is recognised when the Company’s extent that it is no longer probable that sufficient
right to receive dividend is established, which is future taxable income will be available to allow
generally the shareholders’ approval date. all or part of the deferred tax asset to be utilised.
Unrecognised deferred tax assets are re-assessed
Export Incentives: at each reporting date and are recognised to the
Revenue from export incentives are accounted extent that it has become probable that future
for on export of goods if the entitlements can taxable profits will allow the deferred tax asset to
be estimated with reasonable assurance and be recovered.
conditions precedent to claim are fulfilled.
Deferred tax assets and liabilities are measured at
(d) Taxes the tax rates that are expected to apply in the year
Income tax expense comprises current tax expense when the asset is realised or liability is settled, based
and the net change in the deferred tax asset or on tax rates (and tax laws) that have been enacted or
liability during the year. Current and deferred tax substantively enacted at the reporting date.
are recognised in the statement of profit and loss,
except when they relate to items that are recognised Deferred tax relating to items recognised outside
in other comprehensive income or directly in profit or loss is recognised either in other
equity, in which case, the current and deferred comprehensive income or in equity, in correlation
tax are also recognised in other comprehensive to the underlying transaction.
income or directly in equity, respectively.
Deferred tax assets and deferred tax liabilities are
Current income tax offset, if a legally enforceable right exists to set-off
Current income tax assets and liabilities for the current tax assets against current tax liabilities and
current and prior periods are measured at the the deferred tax assets and deferred taxes relate
amount expected to be recovered from or paid to the same taxable entity and the same taxation
to the taxation authorities based on the taxable authority.
income for that period. The tax rates and tax laws
used to compute the amount are those that are In the situations where the Company is entitled
enacted or substantively enacted by the balance to a tax holiday under the Income-tax Act, 1961
sheet date. enacted in India or tax laws prevailing in the
91
Notes
respective tax jurisdictions where it operates, no its cost is recognised in the carrying amount of
deferred tax (asset or liability) is recognised in the plant and equipment as a replacement if the
respect of timing differences which reverse during recognition criteria are satisfied. All other repair
the tax holiday period, to the extent the Company’s and maintenance costs are recognised in profit or
gross total income is subject to the deduction loss as incurred. The present value of the expected
during the tax holiday period. Deferred tax in cost for the decommissioning of an asset after its
respect of timing differences which reverse after use is included in the cost of the respective asset if
the tax holiday period is recognised in the year in the recognition criteria for a provision are met.
which the timing differences originate. However,
the Company restricts recognition of deferred tax The cost comprises purchase price, borrowing
assets to the extent that it has become reasonably cost if capitalization criteria are met and directly
certain, that sufficient future taxable income will be attributable cost of bringing the asset to its
available against which such deferred tax assets working condition for the intended use. Any trade
can be realised. For recognition of deferred taxes, discounts and rebates are deducted in arriving at
the timing differences which originate first are the purchase price.
considered to reverse first.
Depreciation on building and plant & machinery
Minimum alternate tax (MAT) is provided using the Straight-Line Method and
MAT payable for a year is charged to the statement on other property, plant and equipment, using
of profit and loss as current tax. The Company the reducing balance method over the useful lives
recognizes MAT credit available as an asset only estimated by the management basis technical
to the extent that there is convincing evidence that assessment, as given in the table below:
the Company will pay normal income tax during
the specified period, i.e., the period for which MAT Useful lives
Nature of Asset
credit is allowed to be carried forward. In the year (in years)
in which the Company recognizes MAT credit as Building- Factory 30
an asset in accordance with the Guidance Note Building- Others (including Roads) 5-60
on Accounting for Credit Available in respect of Plant & Machinery 2-15
Minimum Alternative Tax under the Income-tax Plant & Machinery – Windmill 9
Act, 1961, the said asset is created by way of Electrical installation 3-10
credit to the statement of profit and loss and shown Furniture & Fixtures 5-10
as ‘MAT Credit Entitlement’ under Deferred Tax. Computers and servers 3-6
The Company reviews the same at each reporting Office equipment’s 5
date and writes down the asset to the extent the Vehicles 4-8
Company does not have convincing evidence that
it will pay normal tax during the specified period. Leasehold improvements are depreciated over the
primary period of lease, or useful life, whichever is
(e) Property, plant and equipment lower, on a straight-line basis.
Property, plant and equipment and Capital work
in progress are stated at cost, net of accumulated An item of property, plant and equipment and any
depreciation and accumulated impairment losses, significant part initially recognised is derecognised
if any. Such costs include the cost of replacing upon disposal or when no future economic
part of the plant and equipment and borrowing benefits are expected from its use or disposal.
costs for long-term construction projects if the Any gain or loss arising on derecognition of the
recognition criteria are met. When significant asset (calculated as the difference between the net
parts of plant and equipment are required to be disposal proceeds and the carrying amount of the
replaced at intervals, the Company depreciates asset) is included in the income statement when
them separately based on their specific useful lives. the asset is derecognised.
Likewise, when a major inspection is performed,
92
Notes
The residual values, useful lives and methods of incurs in connection with the borrowing of funds.
depreciation of property, plant and equipment are Borrowing cost also includes exchange differences
reviewed at each financial year end and adjusted to the extent regarded as an adjustment to the
prospectively, if appropriate. borrowing costs.
Cost of assets not ready for their intended use (h) Leases
at the balance sheet date are disclosed under The Company assesses at contract inception
Capital Work-in-Progress. whether a contract is, or contains, a lease. That
is, if the contract conveys the right to control the
(f) Intangible assets use of an identified asset for a period of time in
Intangible assets acquired separately are measured exchange for consideration.
on initial recognition at cost. Following initial
recognition, intangible assets are carried at cost The Company’s lease assets class primarily consist
less accumulated amortization and accumulated of lease of land, building and premises.
impairment losses, if any.
Company as a Lessee
Computer Software which is not an integral The Company applies a single recognition and
part of the related hardware is classified as an measurement approach for all leases, except
intangible asset. Intangible assets are amortised for short-term leases and leases of low-value
on a reducing balance method over the estimated assets. The Company recognises lease liabilities
useful economic life of 3 years. to make lease payments and right-of-use assets
representing the right to use the underlying assets.
The amortization period and the amortization
method are reviewed at least at each financial i) Right-of-use assets
year end. If the expected useful life of the asset The Company recognises right-of-use assets
is significantly different from previous estimates, at the commencement date of the lease (i.e.,
the amortization period is changed accordingly. If the date the underlying asset is available
there has been a significant change in the expected for use). Right-of-use assets are measured
pattern of economic benefits from the asset, the at cost, less any accumulated depreciation
amortization method is changed to reflect the and impairment losses, and adjusted for any
changed pattern. Such changes are accounted for remeasurement of lease liabilities. The cost
in accordance with Ind AS. of right-of-use assets includes the amount
of lease liabilities recognised, initial direct
Gains or losses arising from derecognition of an costs incurred, and lease payments made at
intangible asset are measured as the difference or before the commencement date less any
between the net disposal proceeds/net realisable lease incentives received. Right-of-use assets
value and the carrying amount of the asset and are depreciated on a straight-line basis over
are recognised in the statement of profit and loss the shorter of the lease term and the estimated
when the asset is derecognised. useful lives of the assets, as follows:
(g) Borrowing costs • Leasehold Land 99 years

Borrowing costs directly attributable to the • Building 5 to 10 years
acquisition, construction or production of an
asset that necessarily takes a substantial period If ownership of the leased asset transfers to
of time to get ready for its intended use or sale the Company at the end of the lease term or
are capitalised as part of the cost of the asset. the cost reflects the exercise of a purchase
All other borrowing costs are expensed in the option, depreciation is calculated using the
period in which they occur. Borrowing costs estimated useful life of the asset.
consist of interest and other costs that an entity
93
Notes

The right-of-use assets are also subject to iii) Short-term leases and leases of low-
impairment. Refer to paragraph (j) of the value assets
accounting policies for impairment of non- The Company applies the short-term lease
financial assets. recognition exemption to its short-term leases.
(i.e., those leases that have a lease term of
ii) Lease Liabilities 12 months or less from the commencement
At the commencement date of the lease, date and do not contain a purchase option).
the Company recognises lease liabilities It also applies the lease of low-value assets
measured at the present value of lease recognition exemption to leases that are
payments to be made over the lease term. considered to be low value. Lease payments
The lease payments include fixed payments on short-term leases and leases of low-
(including in substance fixed payments) less value assets are recognised as expense on a
any lease incentives receivable, variable straight-line basis over the lease term.
lease payments that depend on an index or
a rate, and amounts expected to be paid Company as a Lessor
under residual value guarantees. The lease Leases in which the Company does not
payments also include the exercise price of transfer substantially all the risks and rewards
a purchase option reasonably certain to be incidental to ownership of an asset are
exercised by the Company and payments of classified as operating leases. Rental income
penalties for terminating the lease, if the lease arising is accounted for on a straight-line
term reflects the Company exercising the basis over the lease terms. Initial direct costs
option to terminate. Variable lease payments incurred in negotiating and arranging an
that do not depend on an index or a rate operating lease are added to the carrying
are recognised as expenses (unless they are amount of the leased asset and recognised
incurred to produce inventories) in the period over the lease term on the same basis as rental
in which the event or condition that triggers income. Contingent rents are recognised
the payment occurs. as revenue in the period in which they are
earned.
In calculating the present value of lease
payments, the Company uses its incremental (i) Inventories
borrowing rate at the lease commencement Inventories are valued at the lower of cost and net
date because the interest rate implicit in the realisable value.
lease is not readily determinable. After the
commencement date, the amount of lease Costs incurred in bringing each product to its
liabilities is increased to reflect the accretion present location and condition are accounted for
of interest and reduced for the lease payments as follows:
made. In addition, the carrying amount of
lease liabilities is remeasured if there is a -
Raw materials and components, stores and
modification, a change in the lease term, a spares: cost includes cost of purchase and
change in the lease payments (e.g., changes other costs incurred in bringing the inventories
to future payments resulting from a change in to their present location and condition. Cost is
an index or rate used to determine such lease determined on moving weighted average basis.
payments) or a change in the assessment of
an option to purchase the underlying asset. - Finished goods and work in progress: cost
includes cost of direct materials and labour
The Company’s lease liabilities are disclosed and a proportion of manufacturing overheads
under the head financial liabilities in the based on the normal operating capacity, but
balance sheet (refer note 34). excluding borrowing costs. Cost is determined
on moving weighted average basis.
94
Notes
Net realisable value is the estimated selling price not discounted to their present value and are
in the ordinary course of business, less estimated determined based on the best estimate required
costs of completion and the estimated costs to settle the obligation at the reporting date. These
necessary to make the sale. estimates are reviewed at each reporting date and
adjusted to reflect the current best estimates.
(j) Impairment
Financial assets (other than at fair value) A contingent liability is a possible obligation that
The Company assesses at each date of balance arises from past events whose existence will be
sheet whether a financial asset or a group of confirmed by the occurrence or non-occurrence
financial assets is impaired. Ind AS 109 (‘Financial of one or more uncertain future events beyond the
Instruments’) requires expected credit losses to be control of the Company or a present obligation
measured through a loss allowance. The Company that is not recognised because it is not probable
follows ‘simplified approach’ for recognition of that an outflow of resources will be required to
impairment loss allowances. All financial assets, settle the obligation. A contingent liability also
expected credit losses are measured at an amount arises in extremely rare cases where there is a
equal to the 12-month expected credit losses or at liability that cannot be recognised because it
an amount equal to the life time expected credit cannot be measured reliably. The Company does
losses if the credit risk on the financial asset has not recognize a contingent liability but discloses its
increased significantly since initial recognition. existence in the financial statements.
The Company provides for impairment upon the
occurrence of the triggering event. If the effect of the time value of money is material,
provisions are discounted using a current pre-
Non-financial assets tax rate that reflects, when appropriate, the risks
Tangible and intangible assets specific to the liability. When discounting is used,
Property, plant and equipment and intangible assets the increase in the provision due to the passage of
are evaluated for recoverability whenever there is time is recognised as a finance cost.
any indication that their carrying amounts may not
be recoverable. If any such indication exists, the Warranty provisions
recoverable amount (i.e. higher of the fair value less The estimated liability for product warranties is
cost to sell and the value-in-use) is determined on recorded when products are sold. These estimates
an individual asset basis unless the asset does not are established using historical information on the
generate cash flows that are largely independent nature, frequency and average cost of warranty
of those from other assets. In such cases, the claims and management estimates regarding
recoverable amount is determined for the cash possible future incidence based on corrective
generating unit (CGU) to which the asset belongs. actions on product failures. The timing of outflows
will vary as and when warranty claim will arise
If the recoverable amount of an asset (or CGU) is being typically up to three years.
estimated to be less than its carrying amount, the
carrying amount of the asset (or CGU) is reduced As per the terms of the contracts, the company
to its recoverable amount. An impairment loss is provides post-contact services / warranty support
recognised in the statement of profit and loss. to some of its customers. The company accounts
for the post-contract support / provision for
(k) Provisions and contingent liability warranty on the basis of the information available
A provision is recognised when the Company has with management duly taking into the account the
a present obligation as a result of past event, it is current and post technical estimates.
probable that an outflow of resources embodying
economic benefits will be required to settle the (l) Retirement and other employee benefits
obligation and a reliable estimate can be made Superannuation fund (being administered by Trusts)
of the amount of the obligation. Provisions are and Employees’ State Insurance Corporation
95
Notes
(ESIC) are defined contribution schemes whose -

The date that the Company recognizes
contributions are charged to the statement of profit related restructuring costs.
and loss for the period when they are due to the
respective funds. There are no obligations other Net interest is calculated by applying the discount
than the contributions to the respective funds. rate to the net defined benefit liability or asset. The
Company recognizes the following changes in the
Retirement benefit in the form of provident fund is net defined benefit obligation as an expense in the
a defined contribution scheme. The Company has statement of profit and loss:
no obligation, other than the contribution payable
to the provident fund. The Company recognizes -
Service costs comprising current service
contribution payable to the provident fund scheme costs, past-service costs, gains and losses on
as an expense, when an employee renders the curtailments and non-routine settlements; and
related service. If the contribution payable to the
scheme for service received before the balance - Interest expense and Income
sheet date exceeds the contribution already paid,
the deficit payable to the scheme is recognised as Leave Encashment / Compensated Absences
a liability after deducting the contribution already Accumulated leave, which is expected to be
paid. If the contribution already paid exceeds the utilised within the next twelve months, is treated
contribution due for services received before the as short-term employee benefit. The Company
balance sheet date, then excess is recognised as measures the expected cost of such absences
an asset to the extent that the pre-payment will as the additional amount that it expects to pay
lead to, for example, a reduction in future payment as a result of the unused entitlement that has
or a cash refund. accumulated at the reporting date.
The Company operates a defined benefit gratuity The Company treats accumulated leave expected
plan. The Company contributes to a gratuity fund to be carried forward beyond twelve months, as
maintained by an independent insurance company. long-term employee benefit for measurement
purposes. Such long-term compensated absences
The cost of providing benefits under the defined are provided for based on the actuarial valuation
benefit plan is determined using the projected unit using the projected unit credit method at the year-
credit method. end. Actuarial gain/loss are immediately taken to the
statement of profit and loss and are not deferred.

Remeasurements comprising of actuarial The Company presents the entire leave as a current
gains and losses, the effect of the asset ceiling, liability in the balance sheet, since it does not have
excluding amounts included in net interest on an unconditional right to defer its settlement for
the net defined benefit liability and the return twelve months after the reporting date.
on plan assets (excluding amounts included in
net interest on the net defined benefit liability), (m) Financial instruments
are recognised immediately in the balance sheet Financial instruments are recognised when the
with a corresponding debit or credit to retained Company becomes a party to the contract that
earnings through OCI in the period in which they gives rise to financial assets and financial liabilities.
occur. Remeasurements are not reclassified to
profit or loss in subsequent periods. Financial Assets
Initial recognition and measurement
Past service costs are recognised in the statement All financial assets and liabilities are initially
of profit and loss on the earlier of: measured at fair value. Transaction costs that are
directly attributable to the acquisition or issue of
-
The date of the plan amendment or financial assets and financial liabilities (other than
curtailment, and financial assets and financial liabilities at fair value
96
Notes
through profit or loss) are added to or deducted financial asset expire or it transfers the financial
from the fair value measured on initial recognition asset and the transfer qualifies for derecognition
of financial asset or financial liability. under Ind AS 109. A financial liability (or a part
of a financial liability) is derecognised when the
Subsequent measurement obligation specified in the contract is discharged
Financial assets at amortised cost or cancelled or expires.
Financial assets are subsequently measured at
amortised cost using the effective interest rate (EIR) Financial liabilities
method if these financial assets are held within a Initial recognition and measurement
business whose objective is to hold these assets to
Financial liabilities are classified, at initial
collect contractual cash flows and the contractual recognition, as financial liabilities at fair value
terms of the financial asset give rise on specified through profit or loss, loans and borrowings,
dates to cash flows that are solely payments of payables, or as derivatives designated as hedging
principal and interest on the principal amount instruments in an effective hedge, as appropriate.
outstanding. Amortised cost is calculated by
taking into account any discount or premium on All financial liabilities are recognised initially at
acquisition and fees or costs that are an integral fair value and, in the case of loans and borrowings
part of the EIR. The EIR amortisation is included and payables, net of directly attributable
in finance income in the profit or loss. The losses transaction costs.
arising from impairment are recognised in the
profit or loss. This category generally applies to The Company’s financial liabilities include trade
trade and other receivables. and other payables and borrowings.
Financial assets at fair value through other Subsequent measurement

comprehensive income Financial liabilities at fair value through
Financial assets are measured at fair value through profit or loss
other comprehensive income if these financial Financial liabilities at fair value through profit or
assets are held within a business whose objective is loss include financial liabilities held for trading
achieved by both collecting contractual cash flows and financial liabilities designated upon initial
and selling financial assets and the contractual recognition as at fair value through profit or
terms of the financial asset give rise on specified loss. Financial liabilities are classified as held
dates to cash flows that are solely payments of for trading if they are incurred for the purpose of
principal and interest on the principal amount repurchasing in the near term.
outstanding. Fair value movements are recognised
in Other Comprehensive Income (OCI). Loans and Borrowings
Financial liabilities are subsequently measured at
Financial assets at fair value through profit or loss amortised cost using the effective interest method.
Financial assets are measured at fair value through Gains and losses are recognised in profit or loss
profit or loss unless it is measured at amortised when the liabilities are derecognised as well as
cost or at fair value through other comprehensive through the EIR amortisation process. Amortised
income on initial recognition. The transaction cost is calculated by taking into account any
costs directly attributable to the acquisition of discount or premium on acquisition and fees
financial assets at fair value through profit or loss or costs that are an integral part of the EIR. The
are immediately recognised in statement of profit EIR amortisation is included in finance cost in
and loss. the statement of profit and loss. For trade and
other payables maturing within one year from
Derecognition the balance sheet date, the carrying amounts
The Company derecognizes a financial asset when approximate fair value due to the short maturity
the contractual rights to the cash flows from the of these instruments.
97
Notes
Derecognition assets and liabilities on initial recognition. After

A financial liability is derecognised when the initial recognition, no reclassification is made
obligation under the liability is discharged or for financial assets which are equity instruments
cancelled or expires. When an existing financial and financial liabilities. For financial assets which
liability is replaced by another from the same are debt instruments, a reclassification is made
lender on substantially different terms, or the terms only if there is a change in the business model
of an existing liability are substantially modified, for managing those assets. Changes to the
such an exchange or modification is treated as business model are expected to be infrequent.
the derecognition of the original liability and the If the Company reclassifies financial assets, it
recognition of a new liability. The difference in the applies the reclassification prospectively from the
respective carrying amounts is recognised in the reclassification date which is the first day of the
statement of profit or loss. immediately next reporting period following the
change in business model. The Company does
Fair value of financial instruments not restate any previously recognised gains, losses
In determining the fair value of its financial (including impairment gains or losses) or interest.
instruments, the Company uses following hierarchy
and assumptions that are based on market conditions Offsetting of financial instruments
and risks existing at each reporting date. Financial assets and financial liabilities are offset
and the net amount is reported in the balance
Fair value hierarchy sheet if there is a currently enforceable legal right
All assets and liabilities for which fair value is to offset the recognised amounts and there is an
measured or disclosed in the financial statements intention to settle on a net basis, to realize the
are categorised within the fair value hierarchy, assets and settle the liabilities simultaneously.
described as follows, based on the lowest level input
that is significant to the fair value measurement as (n) Cash and cash equivalents
a whole: Cash and cash equivalents for purpose of cash
flow statement comprise cash at bank and in
Level 1 — Quoted (unadjusted) market prices in hand and short term investments with an original
active markets for identical assets or liabilities. maturity of three months or less, which are subject
to an insignificant risk of changes in value.
Level 2 — Valuation techniques for which the
lowest level input that is significant to the fair value For the purpose of the statement of cash flows,
measurement is directly or indirectly observable. cash and cash equivalents consist of cash
and short-term deposits, as defined above,
Level 3 — Valuation techniques for which the net of outstanding bank overdrafts as they are
lowest level input that is significant to the fair value considered an integral part of the Company’s
measurement is unobservable. cash management.
For assets and liabilities that are recognised in (o) Cash dividend to equity shareholders of the
the financial statements on a recurring basis, Company
the Company determines whether transfers have The Company recognises a liability to make cash
occurred between levels in the hierarchy by re- distributions to equity holders of the Company
assessing categorisation (based on the lowest when the distribution is authorised and the
level input that is significant to the fair value distribution is no longer at the discretion of the
measurement as a whole) at the end of each Company. Final dividends on shares are recorded
reporting period. as a liability on the date of approval by the
shareholders and interim dividends are recorded
Reclassification of financial assets as a liability on the date of declaration by the
The Company determines classification of financial Company’s Board of Directors.
98
Notes
(p) Earnings per share and requires lessees to recognise most leases on the
Basic earnings per share are calculated by dividing balance sheet.
the net profit or loss for the period attributable
to equity shareholders by the weighted average Lessor accounting under Ind AS 116 is substantially
number of equity shares outstanding during the unchanged from Ind AS 17. Lessors will continue
period. Partly paid equity shares are treated as a to classify leases as either operating or finance
fraction of an equity share to the extent that they leases using similar principles as in Ind AS 17.
are entitled to participate in dividends relative Therefore, Ind AS 116 does not have an impact
to a fully paid equity share during the reporting for leases where the Company is the lessor.
period. The weighted average number of equity
shares outstanding during the period is adjusted The Company adopted Ind AS 116 using the
for events such as bonus issue, bonus element in modified retrospective method of adoption and
a rights issue, share split, and reverse share split has taken the cumulative adjustment to retained
(consolidation of shares) that have changed the earnings, on the date of initial application on
number of equity shares outstanding, without a 1 April 2019. The Company elected to use the
corresponding change in resources. transition practical expedient to not reassess
whether a contract is, or contains, a lease at 1
For the purpose of calculating diluted earnings April 2019. Instead, the Company applied the
per share, the net profit or loss for the period standard only to contracts that were previously
attributable to equity shareholders and the identified as leases applying Ind AS 17 and
weighted average number of shares outstanding Appendix C of Ind AS 17 at the date of initial
during the period are adjusted for the effects of all application. The Company also elected to use the
dilutive potential equity shares. recognition exemptions for lease contracts that,
at the commencement date, have a lease term of
2.3Changes in accounting policies and 12 months or less and do not contain a purchase
disclosures option (short-term leases), and lease contracts for
New and amended standards which the underlying asset is of low value (low-
The Company applied Ind AS 116 for the first time. value assets).
The nature and effect of the changes as a result of
adoption of these new accounting standards are Upon adoption of Ind AS 116, the Company
described below. applied a single recognition and measurement
approach for all leases for which it is the lessee,
Several other amendments and interpretations except for short-term leases and leases of low-value
apply for the first time in during the year ending assets. The Company recognised lease liabilities
March 31, 2020, but do not have an impact on to make lease payments and right-of-use assets
the financial statements of the Company. The representing the right to use the underlying assets.
Company has not early adopted any standards or In accordance with the modified retrospective
amendments that have been issued but are not yet method of adoption, the Company applied Ind AS
effective/ notified. 116 at the date of initial application as if it had
already been effective at the commencement date
Ind AS 116 Leases of existing lease contracts.
Ind AS 116 supersedes Ind AS 17 Leases including its
appendices (Appendix C of Ind AS 17 Determining The effect of adoption of Ind AS 116 is as follows;
whether an Arrangement contains a Lease, Appendix
A of Ind AS 17 Operating Leases-Incentives and
Appendix B of Ind AS 17 Evaluating the Substance of
Transactions Involving the Legal Form of a Lease). The
standard sets out the principles for the recognition,
measurement, presentation and disclosure of leases
99
Notes
Impact on balance sheet (increase/ (decrease)):

March 31, 2020 April 1, 2019
Assets
Right of use assets 240.37 113.12
Property, plant and equipment (136.25) -
Prepayments (0.75) -
Deferred tax asset 4.76 3.64
108.13 116.76
Equity
Retained earnings (9.08) (6.76)
Liabilities
Lease liabilities 123.99 130.30
Deferred rent (6.78) (6.78)
117.21 123.52
Impact on statement of profit and loss (increase/ (decrease) in profit):

March 31, 2020
Depreciation and amortisation (18.48)
Finance costs (9.68)
Rent expenses 24.68
Other income 0.04
Deferred tax expenses 1.12
(2.32)
Impact on statement of cash flows (increase/ (decrease)):

March 31, 2020
Operating lease payments 24.68
Net cash flows from operating activities 24.68
Payment of principal portion of lease liabilities (15.00)

Payment of interest portion of lease liabilities (9.68)
Net cash flows from financing activities (24.68)
There is no material impact on the basic earnings per share. depreciation of additional assets recognised (i.e.,
increase in right-of-use assets). This resulted in
As at April 1, 2019: increases in Depreciation and Amortization Expenses
• ‘Right-of-use assets’ were recognised and presented of INR 18.48 Million.
separately in the balance sheet. • Rent expense included in ‘Other expenses’, relating to
• Additional lease liabilities were recognised. previous operating leases, decreased by INR 24.68
• ‘Prepayments’ and ‘Trade and other payables’ related Million.
to previous operating leases were derecognised. • ‘Finance costs’ increased by INR 9.68 Million relating
• ‘Deferred tax assets’ increased because of the deferred to the interest expense on additional lease liabilities
tax impact of the changes in recognised lease related recognised.
assets and liabilities. • ‘Deferred tax expense’ decreased by INR 1.12 Million
• ‘Retained earnings’ decreased due to the net impact of relating to the tax effect of these changes in expenses.
these adjustments. • Cash outflows from operating activities decreased by
INR 24.68 Million and cash outflows from financing
For the year ended 31 March 2020: activities increased the same amount, relating to
• Depreciation expense increased because of the decrease in operating lease payments and increases in
principal and interest payments of lease liabilities.
100
Notes
3. Property, plant and equipment

Office
Freehold Plant & Furniture & equipment Computers
Building Roads Vehicles Total
land Machinery fixtures & & servers
electricals
Cost
At April 01, 2018 3.83 294.54 8.75 1,605.91 13.52 26.66 19.51 4.05 1,976.77
Additions - 5.74 - 364.97 2.42 2.93 2.94 0.11 379.11
Disposals - - - 5.95 - - - 0.39 6.34
At March 31, 2019 3.83 300.28 8.75 1,964.93 15.94 29.59 22.45 3.77 2,349.54
Additions - 256.77 42.27 1,215.42 0.08 26.13 33.91 2.32 1,576.90
Disposals - - - 55.99 - - - - 55.99
At March 31, 2020 3.83 557.05 51.02 3,124.36 16.02 55.72 56.36 6.09 3,870.45
Depreciation
At April 01, 2018 - 36.50 3.90 729.91 5.46 12.60 14.97 2.78 806.12
Charge for the year - 14.71 1.73 431.01 3.51 6.09 2.38 0.73 460.16
Disposals - - - 1.04 - - - 0.29 1.33
At March 31, 2019 - 51.21 5.63 1,159.88 8.97 18.69 17.35 3.22 1,264.95
Charge for the year - 15.40 1.89 299.82 2.28 6.70 22.64 0.38 349.11
Disposals - - - 50.84 - - - - 50.84
At March 31, 2020 - 66.61 7.52 1,408.86 11.25 25.39 39.99 3.60 1,563.22
Net Book Value

At March 31, 2019 3.83 249.07 3.12 805.05 6.97 10.90 5.10 0.55 1,084.59
At March 31, 2020 3.83 490.44 43.50 1,715.50 4.77 30.33 16.37 2.49 2,307.23
Capital Work in Progress Total

At April 01, 2018 167.07
Additions 1,253.03
Capitalisation (265.14)
At March 31, 2019 1,154.96
At April 01, 2019 1,154.96

Additions 961.33
Capitalisation (1,875.65)
At March 31, 2020 240.64
The amount of borrowing costs capitalised during the year ended March 31, 2020 is INR 47.32 million (March 31, 2019:
INR 19.11 million).
101
Notes
4. Intangible assets
Software Total
Cost
At April 01, 2018 10.74 10.74
Additions - -
Disposals - -
At March 31, 2019 10.74 10.74
Additions 6.85 6.85
Disposals - -
At March 31, 2020 17.59 17.59
Amortization
At April 01, 2018 5.18 5.18
Charge for the year 1.70 1.70
Disposals - -
At March 31, 2019 6.88 6.88
Charge for the year 4.63 4.63
Disposals - -
At March 31, 2019 11.51 11.51
Net book value

At March 31, 2019 3.86 3.86
At March 31, 2020 6.08 6.08

5. Financial assets
At amortised cost
Non-current Current
March 31, 2020 March 31, 2019 March 31, 2020 March 31, 2019
Loans
Unsecured, considered good
Loans to employees 0.15 0.30 5.64 4.91
Loans to suppliers (refer note 38) 67.35 19.94 38.03 58.80
67.50 20.24 43.67 63.71
Other financial assets
Net investment in leases (refer note 34(b)) 111.74 - - -
Security deposits 39.37 38.77 - -
Unbilled revenue* - - 31.59 220.76
Others* - - 65.77 23.36
151.11 38.77 97.36 244.12
*Includes receivables from related parties (refer note 36)
102
Notes
6. Other assets
Non-current Current
Capital advances * 77.14 351.39 - -
Advances other than capital advances
Advance to suppliers - - 258.20 318.27
Advance to related parties (refer note 36) - - - 0.25
Prepaid expenses ** - 93.99 59.13 15.96
Balance with statutory/ government authorities *** 0.14 0.14 108.50 87.63
77.28 445.52 425.83 422.11
* Includes advances given to related parties (refer note 36).

** includes INR 37.95 million (March 31, 2019 : INR 93.99 million) of receivable in respect of leasehold land in Madhya Pradesh as described below:
Pursuant to an agreement between the Company and the Government of Madhya Pradesh (‘Government’), on September 2012, the Company had taken a land on lease at
Pithampur, Madhya Pradesh, for setting up a manufacturing unit and paid an upfront premium of INR 97 million (including a stamp duty of INR 20.24 million). The Company
has applied to the Government for surrender of the land due to non-utilisation of the land. In accordance with the Agreement, a surrender charge of 50% of upfront premium
paid is applicable on surrender of the land.
On July 25, 2019, the Company has entered into another agreement with the Government for acquisition of another land for 99 years for a consideration of INR 136.22 million
(including a stamp duty of INR 11.36 million). As per the communication from the Government, the Company has remitted INR 88.81 million and the balance amount payable of INR
36.05 million has been adjusted against the amount recoverable on surrender of the existing leasehold land. With respect to the balance amount of INR 37.95 million recoverable,
in respect of the earlier land, from the government, the management basis its ongoing discussion with the government is confident of receiving the refund. Further, during the quarter
ended June 30, 2019, the Company has provided for the initial registration and stamp duty charges, paid towards acquisition of the land amounting to INR 20.24 million.
*** includes an amount of INR 20.87 million (March 31, 2019: INR 20.87 million) against which the Company has preferred an appeal with sales tax authorities and the
management is confident that the amount will be recovered.
7. Inventories (valued at lower of cost or net realisable value)
March 31, 2020 March 31, 2019

Raw materials (Includes INR 4 million (March 31, 2019: INR 23.06 million) in transit) 580.87 683.05
Work-in-progress 487.37 712.44
Finished goods 386.26 350.10
Stores and spares 105.53 98.11
1,560.03 1,843.70
As at March 31, 2020, the Company has made a provision of INR 64.61 million (March 31, 2019: INR 49.61 million) towards slow
moving/ non-moving and obsolete inventory.
103
Notes
8. Trade receivables
March 31, 2020 March 31, 2019

At amortised cost
Trade receivables 132.95 387.99
Receivables from related parties * 1,094.38 3,075.29
Total trade receivables 1,227.33 3,463.28
Break-up for security details:
Current
Secured, considered good - -
Unsecured, considered good 1,227.33 3,463.28
Trade receivables which have significant increase in credit risk - -
Trade receivables - credit impaired 6.11 6.11
1,233.44 3,469.39
Impairment allowance (allowance for bad and doubtful debts)
Trade receivables - credit impaired (6.11) (6.11)
1,227.33 3,463.28
Trade receivables are non-interest bearing and are generally on terms of 30 to 60 days.
* Includes dues from companies where directors are interested (refer note 36).
9. Cash and cash equivalents
March 31, 2020 March 31, 2019

Cash on hand 0.03 0.07
Balances with banks:
Current accounts 77.31 397.34
Deposits with original maturity of less than three months 660.00 -
737.34 397.41
Cash at banks earns interest at floating rates based on daily bank deposit rates. Short-term deposits are made for varying
periods ranging from 1 to 3 months, depending on the immediate cash requirements of the Company, and earn interest at
the respective deposit rates
10. Other bank balances
March 31, 2020 March 31, 2019

Unpaid dividend 2.64 2.40
In deposit account- Under lien for bank guarantee 0.07 0.07
2.71 2.47
104
Notes
11. Share capital

Equity shares Preference shares
Number of Amount Number of
Amount
shares shares
Authorised share capital

At April 01, 2018 2,30,00,000 230.00 20,00,000 20.00
Increase/ (decrease) during the year - - - -
At March 31, 2019 2,30,00,000 230.00 20,00,000 20.00
Increase/ (decrease) during the year - - - -
At March 31, 2020 2,30,00,000 230.00 20,00,000 20.00
Terms/right attached to equity shares

The Company has issued only one class of equity share having par value of INR 10/- per share. Each holder of equity shares
is entitled to one vote per share. The Company declares and pays dividend in Indian Rupees. The dividend proposed by
Board of Directors is subject to approval by the shareholders at the ensuing Annual General Meeting.
In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the
Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares
held by the shareholders.
Number of
Amount
shares
Issued equity capital

At April 01, 2018 1,51,11,975 151.12
Increase/ (decrease) during the year - -
At March 31, 2019 1,51,11,975 151.12
Increase/ (decrease) during the year - -
At March 31, 2020 1,51,11,975 151.12
(a) Reconciliation of the shares outstanding at the beginning and at the end of the reporting period
March 31, 2020 March 31, 2019

Equity Shares with voting rights Number of Amount Number of
Amount
shares shares
Equity shares
At the commencement of the year 1,51,11,975 151.12 1,51,11,975 151.12
Add: shares issued - - - -
At the end of the year 1,51,11,975 151.12 1,51,11,975 151.12
105
Notes
(b) Details of shares held by each shareholder holding more than 5% shares in the Company:
Class of shares / Name of shareholder

Equity shares with voting rights
March 31, 2020 March 31, 2019
Number of Holding Number of Holding

shares percentage shares percentage
BF Investments Ltd., 53,67,806 35.52% 53,67,806 35.52%

Meritor Heavy Vehicle Systems, LLC USA 53,67,275 35.52% 53,67,275 35.52%
Reliance Capital Trustee Company Ltd. 14,42,729 9.55% 13,36,950 8.85%
(c) T he Company has not issued any bonus shares or issued shares for consideration other than cash nor bought back any
shares from the date of incorporation of the Company.
(d) T he Company has not reserved any shares for issuance under options and contracts/ commitments for the sale of
shares/ disinvestment.
12. Other equity
Particulars March 31, 2020 March 31, 2019

Securities premium account (refer note 13(a))
Balance as per last financial statements 115.59 115.59
Add : Additions during the year - -
Closing balance (a) 115.59 115.59
Retained earnings
Balance as per last financial statements 4,658.87 3,717.82
Add: Profit for the year 406.30 1,186.99
Less:
Dividend (refer note 14) 385.36 204.00
Dividend distribution tax on dividend (refer note 14) 79.21 41.94
Effect of adoption of Ind AS 116 (net of taxes) (refer note 2.3) 6.76 -
Closing balance (b) 4,593.84 4,658.87
General reserves (refer note 13(b))

Balance as per last financial statements 458.82 458.82
Add: Transfer from statement of profit and loss - -
Closing balance (c) 458.82 458.82
Total (a+b+c) 5,168.25 5,233.28
13. Nature and purpose of reserves
a) Securities premium
Securities premium is used to record the premium on issue of shares. The reserve can be utilised only for limited
purposes in accordance with the provisions of section 52 of the Companies Act, 2013.
106
Notes
b) General reserves
Under the erstwhile Companies Act 1956, general reserve was created through an annual transfer of net income at a
specified percentage in accordance with applicable regulations. Consequent to introduction of Companies Act 2013,
the requirement to mandatorily transfer a specified percentage of the net profit to general reserve has been withdrawn.
14. Dividend distribution made and proposed
March 31, 2020 March 31, 2019
Cash dividends on equity shares declared and paid:

Final dividend for the year ended March 31, 2019: INR 19.50 per share 294.68 204.00
Dividend distribution tax on final dividend 60.57 41.94
Interim dividend for the year ended March 31, 2020: INR 6 per share 90.68 -
Dividend distribution tax on interim dividend 18.64 -
464.57 245.94
Proposed dividends on equity shares*
Final dividend for the year ended March 31, 2020: INR 0.80 per share 12.09 294.68
Dividend distribution tax on dividend** - 60.57

12.09 355.25
*Proposed dividends on equity shares are subject to approval at the annual general meeting and hence not recognised as a
liability (including DDT thereon) as at March 31, 2020 and March 31, 2019.
** The Finance Act 2020 has repealed the Dividend Distribution Tax (DDT). Companies are now required to pay/distribute
dividend after deducting applicable taxes.
15. Financial liabilities

Non Current
March 31, 2020 March 31, 2019
Borrowings
Term loan
Indian rupee term loan from a bank (secured) 229.17 730.00
Less: amount disclosed under the head 'Other current financial liabilities' (41.67) (70.97)
187.50 659.03
a) During the financial year 2018-19, the Company has been sanctioned a term loan of INR 1,500 million from HDFC
bank towards capital expansion against which the Company has taken total disbursements of INR 730 million. The
term loan is repayable in 24 quarterly installments after the moratorium period of one year from the date of sanctioning
of the loan. During the current year, the Company has repaid the loan to the extent of INR 500.83 million.The loan
is secured by hypothecation of plant and machinery and other moveable assets both present and future consisting of,
being movable properties, procured out of the said term loan at all locations.
b) The loan carries an interest @ 3 month MCLR (with a quarterly reset) plus 5 bps in the range of 7.90% - 8.50%, payable
monthly basis.
107
Notes
Current
March 31, 2020 March 31, 2019
Other financial liabilities
Current maturities of long term debt (refer note 15(a)) 41.67 70.97
Interest accrued and not due 1.94 5.27
Payable towards capital expenditure 69.84 103.37
Unclaimed dividend 2.64 2.40
Others 67.03 -
183.12 182.01
16. Other liabilities

Non-current Current
Deferred rent - 6.78 - -
Statutory liabilities* - - 12.25 163.61
Advance from customers - - 33.10 79.45
Security deposit received from customers - - 0.23 0.43
- 6.78 45.58 243.49
* Statutory liabilities include provident fund, employee state insurance, professional tax, GST, withholding taxes payables and
other indirect taxes payable.
17. Provisions
Non-current Current
Provision for employee benefits
Provision for gratuity (refer note 37) - - 10.74 28.38
Provision for compensated absence - - 24.93 9.76
Others
Provision for warranty (refer note below) 87.02 70.01 130.92 131.64
87.02 70.01 166.59 169.78
Warranty
Provision for warranty relates to the estimated outflow in respect of warranty for products sold by the Company.
March 31, 2020 March 31, 2019

Opening Balance 201.65 70.83
Additions during the year 38.84 149.97
Utilised/reversed during the year (22.55) (19.15)
Closing Balance 217.94 201.65
108
Notes
18. Trade payables

March 31, 2020 March 31, 2019
At amortised cost
Trade payables (including acceptances)
Total outstanding dues of micro enterprises and small enterprises* 34.76 119.18
Total outstanding dues of creditors other than micro enterprises and small enterprises 1,110.85 2,460.35
1,145.61 2,579.53
* Details of dues to micro and small enterprises as defined under the MSMED Act, 2006
The Company has amounts due to Micro and Small Enterprises under The Micro, Small and Medium Enterprises Development
Act, 2006 (MSMED Act) as at March 31, 2020 and March 31, 2019. The details in respect of such dues are as follows:
March 31, 2020 March 31, 2019

Principal amount remaining unpaid to any supplier as at the end of the accounting year 34.76 119.18
Interest due thereon remaining unpaid to any supplier as at the end of the accounting year - -
The amount of interest paid by the buyer in terms of section 16 of the Micro, Small and Medium - -
Enterprises Development Act, 2006 (27 of 2006), along with the amount of the payment made to
the supplier beyond the appointed day during each accounting year
The amount of interest due and payable for the period of delay in making payment (which has - -
been paid but beyond the appointed day during the year) but without adding the interest specified
under the Micro, Small and Medium Enterprises Development Act, 2006;
The amount of interest accrued and remaining unpaid at the end of each accounting year; and - -
The amount of further interest remaining due and payable even in the succeeding years, until - -
such date when the interest dues above are actually paid to the small enterprise, for the purpose
of disallowance of a deductible expenditure under section 23 of the Micro, Small and Medium
Enterprises Development Act, 2006
The information as required to be disclosed under The Micro, Small and Medium Enterprises Development Act, 2006
regarding Micro and Small enterprises determined to the extent such parties have been identified on the basis of the
information available with the company.
19. Current tax liabilities (net)

March 31, 2020 March 31, 2019
Provision for income tax (net of advance income tax) 26.12 37.69
26.12 37.69
20. Deferred tax assets (net)

March 31, 2020 March 31, 2019
Depreciation and amortisation expense: difference between tax depreciation and depreciation as 66.68 88.23
per statement of profit and loss
Provision for employee benefits and others 33.74 59.75
Net Deferred tax assets 100.42 147.98
109
Notes
Income taxes
Components of income tax expense
(a) The major components of income tax expense for the year ended March 31, 2020 and March 31, 2019 are:
March 31, 2020 March 31, 2019

(i) Statement of Profit and loss
Current tax 147.13 711.40
Income tax relating to prior years (11.82) -
Deferred tax relating to origination and reversal of temporary differences 52.89 (73.79)
Tax expense reported in the statement of profit and loss 188.20 637.61
(ii) OCI section
Deferred tax related to items recognized in OCI during the year
Net actuarial (loss) /gain on remeasurement of defined benefit plans 1.69 15.31
Income tax (credit) / charge to OCI 1.69 15.31
(b) Reconciliation of tax expense and accounting profit for the year ended March 31, 2020 and March 31, 2019
March 31, 2020 March 31, 2019

Accounting profit before income tax 619.78 1,853.11
Enacted tax rates in India 25.168% 34.944%
Computed expected tax expense 155.99 647.55
Tax effect on permanent non-deductible expenses 2.38 6.45
Impact of tax holiday under section 80-IA and 80-IC of Income tax Act, 1961 - (20.47)
One-time additional deferred tax charge (refer note below) 42.06
Income tax relating to prior years (11.82)
Others (0.41) 4.08
At the effective income tax rate 188.20 637.61
Income tax expense reported in the statement of profit and loss 188.20 637.61
The Company has exercised the option of availing the lower tax rate available under Section 115BAA of the Income Tax Act,
1961, as introduced by Taxation Laws (Amendment) Ordinance, 2019, with effect from AY 2020-21, thereby lowering the
tax rate from 34.944% to 25.168% effective April 01, 2019. Accordingly, the Company has provided for income taxes for
the year ended March 31, 2020 and re-measured the accumulated balance of deferred tax assets as at March 31, 2019,
based on the rate prescribed under the aforesaid Section. The resultant impact has been taken through the statement of
profit and loss. The re-measurement of accumulated deferred tax assets has resulted in a one-time additional deferred tax
charge of INR 42.06 million for the year ended March 31, 2020.
110
Notes
21. Revenue from operations
March 31, 2020 March 31, 2019

Sale of products 9,229.53 18,795.37
9,229.53 18,795.37
Other operating revenue
Sale of scrap and others 223.30 545.23
Tooling Income 58.04 36.87
Income from wind power generation 8.71 12.95
290.05 595.05
Revenue from operations 9,519.58 19,390.42
22. Other income
March 31, 2020 March 31, 2019

Interest income on deposits with banks 32.14 7.73
Interest - others 24.47 17.86
Fair value gain on financial instruments at fair value through profit or loss - 0.42
Profit on sale of property, plant and equipment 7.73 1.52
Miscellaneous income 12.89 2.07
77.23 29.60
23. Cost of materials consumed
March 31, 2020 March 31, 2019

Inventory at the beginning of the year 683.05 584.47
Add: Purchases 6,164.48 13,894.69
Less: inventory at the end of the year (580.87) (683.05)
6,266.66 13,796.11
24. Changes in inventories of finished goods, stock-in-trade and work-in-progress
March 31, 2020 March 31, 2019

Closing stock
Total 873.63 1,062.54
Opening stock
Total 1,062.54 715.01
(Increase)/Decrease 188.91 (347.53)
111
Notes
25. Employee benefits expenses
March 31, 2020 March 31, 2019

Salaries, wages and bonus 725.56 1,041.80
Contribution to provident and other funds 58.01 75.66
Gratuity expense (refer note 37) 11.33 13.20
Compensated absences 21.18 23.51
Staff welfare expenses 74.82 80.97
890.90 1,235.14
26. Depreciation and amortisation expense
March 31, 2020 March 31, 2019

Depreciation of property, plant and equipment 349.11 460.16
Amortisation of intangible assets 4.63 1.70
Depreciation of right-of-use assets (refer note 34) 18.48 -
372.22 461.86
27. Finance costs
March 31, 2020 March 31, 2019

Interest expense
- on borrowings from banks* 6.26 -
- on lease liabilities (refer note 34) 9.68 -
- on others 1.95 4.03
Bank charges 0.18 1.46
18.07 5.49
* net of borrowing cost capitalised to property, plant and equipment
28. Other expenses
March 31, 2020 March 31, 2019

Stores and spares consumed 231.32 467.72
Power and fuel 157.92 316.50
Travelling expenses 12.05 21.82
Rent including lease rentals 41.41 31.97
Repairs and maintenance
Buildings 13.32 6.23
Plant and machinery 105.00 273.06
Others 19.88 25.68
Rates and taxes 7.79 10.89
Insurance charges 11.34 9.23
Postage, telephone and telegram 2.45 3.14
Vehicle running expenses 0.59 0.87
Directors' sitting fees 1.45 1.25
Legal and professional charges 28.50 24.13
Payment to auditor (refer note (i) below) 3.98 4.78
Technical fees 39.86 94.86
Outside processing charges 431.07 856.60
Warranty (net) (refer note 17) 38.84 149.97
Freight charges 35.13 55.38
Allowances for doubtful trade/ other receivables, net of reversals - 0.44
112
Notes
March 31, 2020 March 31, 2019
Corporate social responsibility expenditure (refer note 30) 25.86 16.89
Miscellaneous expenses 32.51 44.43
1,240.27 2,415.84
Note
(i) Payments to auditors:
March 31, 2020 March 31, 2019
As auditor (excluding GST)
Statutory audit fee 3.50 3.70
Reimbursement of expenses 0.48 0.64
3.98 4.34
29. E
xceptional items
March 31, 2020 March 31, 2019

Surrender charges for leasehold land 20.24 -
20.24 -
Represents loss on account of surrender of leasehold land (refer note 6).
30. Disclosures in accordance with Guidance Note on Accounting for Expenditure on

Corporate Social Responsibility Activities
March 31, 2020 March 31, 2019

a) Gross amount required to be spent by the Company during the year. 25.86 16.85
b) Amount spent during the year ended March 31, 2020: In cash Yet to be paid Total
in cash
(i) Construction/ acquisition of any assets 9.55 - 9.55
(ii) On purposes other than (i) above 15.71 0.60 16.31
c) Amount spent during the year ended March 31, 2019: In cash Yet to be paid Total
in cash
(i) Construction/acquisition of any assets - - -
(ii) On purposes other than (i) above 16.89 - 16.89
31. Earnings per share (EPS)

The following reflects the income and share data used in the basic and diluted EPS computations:
March 31, 2020 March 31, 2019

Profit attributable to equity shareholders for basic and diluted earnings 411.34 1,215.50
Weighted average number of Equity shares for basic and diluted EPS (nos) * 1,51,11,975 1,51,11,975
* There are no transactions involving equity shares or potential equity shares between the reporting date and the date of
authorisation of these financial statements.
113
Notes
32.Significant accounting judgements, date of approval of these financial statements and the
estimates and assumptions Company will continue to closely monitor any material
The preparation of the Company’s financial statements in changes to future economic conditions.
conformity with Ind AS requires the management to make
estimates, judgements and assumptions that affect the Determining the lease term of contracts with
reported amounts of assets and liabilities, the disclosure of renewal options – Company as lessee:
contingent assets and liabilities on the date of the financial The Company determines the lease term as the non-
statements and the reported amounts of revenues and cancellable term of the lease, together with any
expenses for the year reported. Actual results could differ periods covered by an option to extend the lease if it
from those estimates. Estimates and underlying assumptions is reasonably certain to be exercised, or any periods
are reviewed on an ongoing basis. Revisions to accounting covered by an option to terminate the lease, if it is
estimates are recognised in the year in which the estimates reasonably certain not to be exercised.
are revised and future periods are affected. Uncertainty
about these assumptions and estimates could result in
The Company has lease contracts that include
outcomes that require a material adjustment to the carrying extension options. The Company applies judgement
amount of assets or liabilities affected in future periods. in evaluating whether it is reasonably certain whether
or not to exercise the option to renew the lease.
Other disclosures relating to the Company’s exposure to That is, it considers all relevant factors that create an
risks and uncertainties includes: economic incentive for it to exercise the renewal. After
the commencement date, the Company reassesses the
i) Capital management - Note 41 lease term if there is a significant event or change in
ii) Financial risk management objectives and policies - circumstances that is within its control and affects its
Note 40 ability to exercise or not to exercise the option to renew.
iii) Sensitivity analyses disclosures - Notes 37 and 40
Property lease classification – Company as lessor
The Company has entered into a property lease. The
Judgements: Company has determined, based on an evaluation
In the process of applying the Company’s accounting of the terms and conditions of the arrangements, the
policies, management has made the following judgements, present value of the minimum lease payments amounts
which have the most significant effect on the amounts to substantially all of the fair value of the property and
recognised in the financial statements: accounted for the contracts as finance lease.
Estimation of uncertainties relating to the Estimates and assumptions:

global health pandemic from COVID-19 Key source of estimation of uncertainty as at the date
(COVID-19): of financial statements, which may cause a material
The outbreak of Coronavirus disease (COVID-19) has adjustment to the carrying amounts of assets and liabilities
significantly impacted businesses around the globe and within the next financial year, is in respect of the following:
has been recognized as a global pandemic by the World
Health Organisation (WHO). The various Governments Defined benefit plans (gratuity benefits):
across the world including India are taking drastic The cost of the defined benefit gratuity plan and the
measures, including locking down of entire country to present value of the gratuity obligation are determined
reduce the impact of this catastrophe. The Company using actuarial valuations. An actuarial valuation involves
has considered the possible effects that may result from making various assumptions that may differ from actual
the pandemic relating to COVID-19 on the carrying developments in the future. These include the determination
value of property, plant and equipment, inventories, of the discount rate, future salary increases and mortality
receivables and other assets considering internal and rates. Due to the complexities involved in the valuation
external information up to the date of approval of and its long-term nature, a defined benefit obligation
these financial statements. The impact of global health is highly sensitive to changes in these assumptions. All
pandemic may be different from that estimated as at the assumptions are reviewed at each reporting date.
114
Notes

The parameter most subject to change is the of warranty claims and also management estimates
discount rate. In determining the appropriate regarding possible future outflow on servicing the
discount rate for plans operated in India, the customers for any corrective action in respect of product
management considers the interest rates of failure.
government bonds in currencies consistent with the
currencies of the post-employment benefit obligation. Leases - estimating the incremental
borrowing rate
The mortality rate is based on publicly available The Company cannot readily determine the interest rate
mortality tables. These mortality tables tend to change implicit in the lease, therefore, it uses its incremental
only at interval in response to demographic changes. borrowing rate (IBR) to measure lease liabilities. The IBR is
Future salary increases and gratuity increases are based the rate of interest that the Company would have to pay to
on expected future inflation rates. borrow over a similar term, and with a similar security, the
funds necessary to obtain an asset of a similar value to the
Provision for inventories: right-of-use asset in a similar economic environment.
Management reviews the aged inventory on a periodic
basis. This review involves comparison of the carrying
value of the aged inventory item with the respective net 33.Segment reporting
realisable value. The purpose is to ascertain whether The Company is predominantly engaged in the
an allowance is required to be made in the financial business of manufacturing and sale of automotive
statements for any obsolete and slow-moving items. The components, which constitutes a single business
management also evaluates on the usability of existing segment and is governed by similar set of risks and
inventories as a result of technological and regulatory returns. The operations of the Company primarily cater
changes in the automotive sector and provides for the to the market in India, which the management views
required allowances for slow moving/ non-moving as a single segment. The management monitors the
and obsolete inventory. Management believes that operating results of its single segment for the purpose
adequate allowance for obsolete and slow-moving of making decisions about resource allocation and
inventories has been made in the financial statements. performance assessment.
Impairment of financial assets One customer individually accounted for INR 7,847.35
The impairment provisions for financial assets are based million (March 31, 2019: INR 15,606.16 million) which
on assumptions about risk of default and expected loss is more than 10% of the total revenue of the Company
rates. The Company uses judgement in making these for the year ended March 31, 2020.
assumptions and selecting the inputs to the impairment
calculation, based on Company’s past history, existing The Company is domiciled in India. The Company’s
market conditions as well as forward looking estimates revenue from operations from external customers primarily
at the end of each reporting period. relate to operations in India and all the non-current assets
of the Company are located in India.
Provision for warranty:
Warranty estimates are established using historical
information on the nature, frequency and average cost
115
Notes
34. Leases
a) Company as a lessee
i) The Company has entered into property leases consisting of the Company’s branch offices and manufacturing
facilities which includes land and building. These leases are for a period of five to ten years and lease of land is for
99 years with renewal option included in the contracts. The Company’s obligations under its leases are secured by
the lessor’s title to the leased assets.The Company also has certain leases with lease terms of 12 months or less.
The Company applies the ‘short-term lease’ recognition exemption for these leases.
Below are the carrying amounts of right-of-use assets recognised and the movements during the year:
Leasehold Leasehold Land

Total
Building (refer note 6)
As at April 01, 2019 113.12 - 113.12
Additions/ (deletions) (3.02) 148.75 145.73
Depreciation expense (17.48) (1.00) (18.48)
As at March 31, 2020 92.62 147.75 240.37
Below are the carrying amounts of lease liabilities and the movements during the year:
Leasehold Leasehold Land
Total
Building
As at April 01, 2019 130.30 - 130.30
Additions/ (deletions) (3.83) 12.52 8.69
Accretion of interest 9.68 - 9.68
Interest payments (9.68) - (9.68)
Principal payments (14.07) (0.93) (15.00)
As at March 31, 2020 112.40 11.59 123.99
Current 16.58
Non-current 107.41
123.99
The maturity analysis of lease liabilities are disclosed in 40 (iii).
The effective interest rate of lease liabilities is 8%, with maturity between financial year 2024 - 2029 for leasehold
building and in financial year 2118 for leasehold land.
The following are the amounts recognised in profit or loss:
March 31, 2020

Depreciation expense of right-of-use assets 18.48
Interest expense on lease liabilities 9.68
Expense relating to short-term leases (included in other expenses) 41.41
Total amount recognised in statement profit or loss 69.57
116
Notes
The Company had total cash outflows for leases of INR 160.90 million for the year ended March 31, 2020 which
includes INR 136.22 million of upfront lease payment. The Company also had non-cash additions to right-of-use
assets and lease liabilities of INR 122.63 million and INR 138.99 million for the year ended March 31, 2020.
There are no future cash outflows relating to leases that have not yet commenced.
b) Company as a lessor
The Company has entered into lease agreements with Meritor Heavy Vehicle Systems India Limited (‘MHVSIL’)
and Meritor Commerical Vehicle Systems India Limited (‘MCVSIL’) to obtain a land on lease from MHVSIL
and to construct a R&D test lab building (‘R&D Building’) and lease it back to MCVSIL for R&D activities. This
lease have a term of 20 years. Since both of these lease contracts were entered with the related parties on the
same date and negotiated as one lease, these leases are essentially treated as a single contract in substance,
wherein, the Company is the lessor of R&D building and MCVSIL is the lessee. The Company recognised INR
111.13 million being the present value of net lease rent receivables. Net finance income on lease receivables
recognised by the Company during the year is INR 4.82 million.

Future minimum rentals receivables under finance lease is as follows:
March 31, 2020 March 31, 2019

Not later than one year 8.65 -
Later than one year and not later than five years 39.14 -
More than five years 200.60 -
248.39 -
Reconciliation of the undiscounted lease payments to the net investment in the lease:
Total undiscounted lease receivables 248.39 -

Less: unearned finance income related to future years (136.66) -
Net investment in leases (refer note 5) 111.74 -
35. Commitments and contingencies
March 31, 2020 March 31, 2019
a) Capital commitments
Estimated amount of contracts remaining to be executed on capital account and not provided for 153.44 581.76
March 31, 2020 March 31, 2019
b) Contingent liabilities - -
117
Notes
36. Related party transactions

i) Names of related parties and related party relationship
(a) R
elated parties where controls exist irrespective of whether transactions have occurred or not:
Entities having joint control over the Company
Meritor Heavy Vehicle System LLC
Meritor Inc, Troy
BF Investments Limited, Pune
(b) Other Related Parties with whom the Company had transactions:
Meritor HVS (India) Limited
Arvin Meritor, Sweden
Meritor Heavy Vehicle Systems Cameri Spa
Xuzhou Meritor Axle Co.Ltd.
Fonderie Venissieux SAS
Meritor HVS LLC, Morristown
Meritor HVS LLC, Florence
Meritor HVS Inc., Fletcher
Meritor Heavy Vehicle Systems, Maxtown
Meritor HVS AB., Sweden
Master Sistemas Automotivos Ltda.
Meritor Laurinberg Speciality
Meritor Monterrey, Mexico
Meritor Commercial Vehicle Systems (India) Pvt. Ltd.
Meritor do Brasil Sistemas Automotivos Ltda.
Meritor Heavy Vehicle Systems Singapore Pte Ltd
Enterprises over which Key Managerial Personnel (KMP) have significant influence:
Bharat Forge Limited
Synise Technologies Ltd
Key management personnel

Dr. B N Kalyani Chairman
Mr. Kumaradevan Srinivasan Senior Vice president & Whole time Director - appointed w.e.f August 14, 2019
Dr. N Muthukumar President & Whole-Time Director - resigned w.e.f August 14, 2019
Mr. Ranganathan S Chief Financial Officer
Mr. Debadas Panda Company Secretary
Bhalachandra B Hattarki Independent Director

B C Prabhakar Independent Director
Rakesh Kalra Independent Director
Chrishan Anton Sebastian Villavarayan Director
Supriti Bhandary Independent Director - resigned w.e.f February 12, 2019
Dr. Shalini Sarin Independent Director
Transactions and balances less than 10% of the total transactions and balances disclosed as “Others”.
118
Notes
(ii) Related Party disclosures

Purchase of Goods
Bharat Forge Limited 161.87 406.23
Meritor Heavy Vehicle Systems LLC, Morristown 13.56 25.35
Meritor Heavy Vehicle Systems Cameri Spa 10.19 18.88
Meritor HVS AB., Sweden 8.18 -
Meritor Heavy Vehicle Systems Singapore Pte Ltd 8.17 -
Meritor HVS Inc., Fletcher 3.35 -
Fonderie Venissieux SAS - 27.30
Arvin Meritor, Sweden - 19.74
Meritor Monterrey, Mexico - 6.95
Meritor Heavy Vehicle Systems, Maxtown - 5.10
Others 4.30 8.64
209.62 518.19
Sale of Goods
Meritor HVS (India) Limited 7,847.35 15,606.16
Meritor Commercial Vehicle Systems (India) Pvt. Ltd. 4.69 -
Bharat Forge Limited - 0.36
Others 0.25 0.42
7,852.29 15,606.94
Purchase of property, plant and equipment
Bharat Forge Limited 4.23 -
Tooling income
Meritor HVS (India) Limited 58.04 36.87
Lease rental income*

Lease rental expense*

Meritor HVS (India) Limited 2.21 -
Purchase of MLFPS and MEIS Licences (Export incentive) and Others

Meritor Commercial Vehicle Systems (India) Pvt. Ltd. - 9.64
61.46 33.21
Services Received
Bharat Forge Limited (Outside processing charges) 90.42 210.33
Meritor HVS (India) Limited (Technical fees) 39.86 94.86
Synise Technologies Ltd (Scrap sales commission and logistics support fees) 1.85 6.03
132.13 311.22
Sale of property, plant and equipment
Dr. N. Muthukumar - 0.10
Other Recoveries
Meritor HVS (India) Limited (Freight charge recoveries) 51.17 100.80
Meritor Commercial Vehicle Systems (India) Pvt. Ltd. (Electricity charge recoveries) 12.59 -
Others - 0.30
63.78 103.44
119
Notes

Reimbursement of expenses
Dr. N Muthukumar 0.69 1.83
Ranganathan S 0.35 0.27
Debadas Panda 0.14 0.07
Kumaradevan Srinivasan 0.05 -
Dr. Shalini Sarin 0.01 -
1.24 2.17
Directors sitting fees
Dr. B N Kalyani 0.20 0.05
Bhalachandra B Hattarki 0.40 0.40
B C Prabhakar 0.35 0.40
Rakesh Kalra 0.30 0.30
Dr. Shalini Sarin 0.20 0.05
Supriti Bhandary - 0.05
1.45 1.25
Dividend paid
Meritor Heavy Vehicle System LLC 136.87 72.46
BF Investments Limited 136.88 72.47
273.75 144.93
Compensation of key management personnel:
Salaries and allowances 19.54 20.20
As the liabilities for gratuity and leave encashment are provided on an actuarial basis for the
Company as a whole, the amounts pertaining to the key management personnel are not included
above.
Balance outstanding as at year end
Trade receivables
Meritor HVS (India) Limited 1,094.13 3,075.29
Others 0.25 -
1,094.38 3,075.29
Lease receivables*
Other financial assets (including unbilled revenue)

Dr. N Muthukumar - 0.12
80.27 270.48
Capital advances
Advance to suppliers
Xuzhou Meritor Axle Co.Ltd. - 0.25
120
Notes
Trade payables
Meritor HVS (India) Limited - 7.02
Others 5.95 28.72
60.62 138.81
Advance from customers
Xuzhou Meritor Axle Co.Ltd. 2.70 2.70
25.98 54.68
* represents the amount received/ receivable and paid/ payable and does not include adjustments relating to Ind AS 116.
Terms and conditions of transactions with related parties
The sales to and purchases from related parties are made on terms equivalent to those that prevail in arm’s length transactions.
Outstanding balances at the year-end are unsecured and interest free and settlement occurs in cash. There have been
no guarantees provided or received for any related party receivables or payables. For the year ended March 2020, the
Company has not recorded any impairment of receivables relating to amounts owed by related parties (March 31, 2019:
Nil). This assessment is undertaken each financial year through examining the financial position of the related party and the
market in which the related party operates.
37. Employee benefits

Defined contribution plans
A. Provident fund and employee state insurance scheme
The Company makes contributions to provident fund and employee state insurance scheme, which are defined
contribution plan for eligible employees. Under the scheme, the Company is required to contribute a specified
percentage of the salary to fund the benefits. The Company recognized INR 43.92 million (March 31, 2019:
54.04 million) for provident fund contributions and INR 6.36 million (March 31, 2019: INR 13.11 million) for
employee state insurance scheme contribution in the statement of profit and loss.
The Supreme Court of India in a judgment on Provident Fund dated February 28, 2019 addressed the principle for
determining salary components that form part of basic salary for individuals below a prescribed salary threshold.
The Company determined that they had not previously included such components in basic salary. There are
numerous interpretative issues relating to the Supreme Court (SC) judgement on PF dated 28th February, 2019.
The Company is in the process of evaluating the way forward in respect of the aforementioned matter. However,
as a matter of caution, the Company has made a provision on a prospective basis from the date of the SC order
amounting to INR 4.94 million till March 31, 2020.
B. Superannuation fund
Retirement benefits in the form of superannuation fund (being administered by LIC) are funded defined contribution
schemes and the contributions are charged to the statement of profit and loss of the year when the contributions to
the respective funds are due. There are no other obligations other than the contribution payable. The contributions
for the year ended March 31, 2020 is INR 7.73 million (March 31, 2019: INR 8.50 million).
121
Notes
Defined benefit plans

The Company has a defined benefit gratuity plan for its employees. The gratuity plan is governed by the Payment of
Gratuity Act, 1972. Under the act, employee who has completed five years of service is entitled to specific benefit. The
level of benefits provided depends on the member’s length of service and salary at retirement age. The Company makes
provision of such gratuity liability in the books of accounts on the basis of actuarial valuation as per the projected unit
credit method.
The following tables summarize the components of net benefit expense recognized in the Statement of Profit and Loss
and the funded status and amounts recognized in the Balance Sheet.
March 31, 2020 March 31, 2019

Change in projected benefit obligations
Obligations at beginning of the year 232.10 170.53
Service cost 10.67 13.38
Interest cost 13.65 12.83
Benefits settled (10.25) (9.14)
Acturial (gain) /loss (through OCI) 7.46 44.50
Obligations at end of the year 253.63 232.10
Change in plan assets

Plan assets at beginning of the year, at fair value 203.72 147.93
Interest income 12.99 13.01
Actuarial gain /(loss) (through OCI) 0.73 0.68
Contributions 35.00 50.00
Benefits settled (9.55) (7.90)
Plan assets at end of the year 242.89 203.72
Present value of defined benefit obligation at the end of the year 253.63 232.10
Less: Fair value of plan assets at the end of the year 242.89 203.72
Net liability/ (asset) recognised in the balance sheet 10.74 28.38
Expenses recognised in statement of profit and loss

Service cost 10.67 13.38
Interest cost (net) 0.66 (0.18)
Net gratuity cost 11.33 13.20
Re-measurement gains / (losses) in OCI

Actuarial (gain) / loss due to demographic assumptions (3.42) (7.42)
Actuarial (gain) / loss due to financial assumption changes (10.05) 5.06
Actuarial (gain) / loss due to experience adjustments 20.93 46.86
Return on plan assets (greater)/less than discount rate (0.73) (0.68)
Total expenses routed through OCI 6.73 43.82
122
Notes
The major categories of plan assets of the fair value of the total plan assets are as follows:
Investments with insurer 100% 100%
The principal plan asset consist of a scheme of insurance taken by the company, which is a qualifying insurance policy.
The principal assumptions used in determining gratuity benefit obligations for the company’s plans are shown
below:
March 31, 2020 March 31, 2019
% %
Discount rate 6.00% 7.70%
Future salary increases Staff 15% & 5.50%
Labour 2%
Mortality table Indian assured Indian assured
lives Mortality lives Mortality
(2006-2008) (2006-2008)
(modified) Ult. (modified) Ult.
Employee turnover Staff 15% & For vested 5%
Labour 2% For non vested
12%
Retirement age 58 58
Estimated rate of return on plan assets 6.00% 7.70%
The estimates of future salary increases considered in actuarial valuation, take account of inflation, seniority, promotion and
other relevant factors, such as supply and demand in the employment market.
Assumptions regarding future mortality are based on published statistics and mortality tables.
A quantitative sensitivity analysis for significant assumption as at March 31, 2020 is as shown below:
Defined benefit obligation
Sensitivity Level March 31, 2020 March 31, 2019
Change in DBO Change in DBO
Discount rate 1% increase (13.93) (13.41)

1% decrease 15.36 14.78
Further salary increase 1% increase 15.87 15.08
1% decrease (14.62) (13.90)
Attrition rate 1% increase 1.54 0.76
1% decrease (1.66) (0.81)
Mortality rate 10% increase 0.07 0.04
The sensitivity analyses above have been determined based on a method that extrapolates the impact on defined benefit
obligation as a result of reasonable changes in key assumptions occurring at the end of the reporting period. The sensitivity
analyses are based on a change in a significant assumption, keeping all other assumptions constant. The sensitivity analyses
may not be representative of an actual change in the defined benefit obligation as it is unlikely that changes in assumptions
123
Notes
would occur in isolation from one another.
The following payments are expected contributions to the defined benefit plan in future years:
March 31, 2020 March 31, 2019

Five Years pay-outs
Year 1 20.85 15.68
Year 2 20.40 15.55
Year 3 20.42 17.79
Year 4 17.74 17.70
Year 5 25.38 17.68
Next 5 years 104.87 100.58
Contributions likely to be made for the next one year 10.74 28.38
The average duration of the defined benefit plan obligation at the end of the reporting period is 11.33 years (March 31,
2019: 10.70 years).
38. Disclosure required under section 186(4) of the Companies Act 2013
Particulars of loans given to suppliers included in loans have been disclosed below as per the requirement of Section
186(4) of the Companies Act 2013 is as follows:
Rate of interest Secured/

Name of the Loanee March 31, 2020 March 31, 2019
Unsecured
Adma Auto Components Private Limited 14.00% Secured 33.65 43.94
Ideal Automation 13.00% Secured 7.50 10.83
Siddhi Robo Plasma Cuts Private Limited 13.50% Secured 2.66 3.32
Ess Enn Engineering 13.00% Unsecured 4.50 -
Millennium Moulds & Dies 13.00% Secured 17.16 19.75
Addsub Innovative Solution 13.00% Secured 0.40 0.90
Kems Forgings Limited 11.50% Secured 37.33 -
AB Auto Components 11.00% Unsecured 2.18 -
105.38 78.74
The loan has been given for meeting the fixed and working capital requirements.
124
Notes
The aforesaid loans are repayable in periodic instalments as per the contractual terms.
39. Fair values hierarchy
The carrying value of financial instruments by categories is as follows:

Financial assets measured at amortized cost:
Loans to employees * 5.79 5.21
Loan to suppliers * 105.38 78.74
Security deposit ** 39.37 38.77
Unbilled revenue * 31.59 220.76
Lease receivables** 111.74 -
Other financial assets* 65.77 23.36
Trade receivable * 1,227.33 3,463.28
1,586.97 3,830.12
Cash and cash equivalents and other bank balances
Cash and cash equivalents # 737.34 397.41
Other bank balances # 2.71 2.47
740.05 399.88
Financial liabilities measured at amortized cost:
Borrowings** 187.50 659.03
Lease liabilities** 123.99 -
Trade payables* 1,145.61 2,579.53
Other financial liabilites* 183.12 182.01
1,640.22 3,420.57
* The carrying value of these accounts are considered to be the same as their fair value, due to their short term nature. Accordingly, these are classified as level 3 of fair value
hierarchy.
** The fair value of these accounts was calculated based on cash flow discounted using a current lending/ borrowing rate, they are classified as level 3 fair value hierarchy due to
inclusion of unobservable inputs including counterparty credit risk.
# These accounts are considered to be highly liquid/ liquid and the carrying amount of these are considered to be the same as their fair value.

125
Notes
40. Financial risk management objectives a. Interest rate risk

and policies Interest rate risk is the risk that the fair value or
The Company’s principal financial liabilities comprise future cash flows of a financial instrument will
borrowings, lease liabilities and trade and other fluctuate because of changes in market interest
payables. The main purpose of these financial rates. The following table demonstrates the
liabilities is to finance the Company’s operations. sensitivity to a reasonably possible change
The Company’s principal financial assets include in interest rates on that portion of loans and
loans, trade and other receivables, and cash and cash borrowings affected. With all other variables
equivalents that derive directly from its operations. held constant, the Companys profit before tax
is affected through the impact on floating rate
The Company is exposed to market risk, credit risk borrowings, as follows:
and liquidity risk. The Company’s senior management
oversees the management of these risks. It is the Increase/ Effect on
(decrease) in profit before
Company’s policy that no trading in derivatives for basis points tax
speculative purposes may be undertaken. The Board March 31, 2020 50 (1.15)
of Directors reviews and agrees policies for managing (50) 1.15
each of these risks, which are summarised below: March 31, 2019 50 (3.65)
(50) 3.65
i. Market risk
Market risk is the risk that the fair value of future The assumed movement in basis points for
cash flows of a financial instrument will fluctuate the interest rate sensitivity analysis is based on
because of changes in market prices. Market the currently observable market environment,
risk comprises three types of risk: interest rate showing a significantly higher volatility than in
risk, currency risk and other price risk, such as prior years.
equity price risk and commodity risk. Financial
instruments affected by market risk include loans b. Foreign currency risk
and borrowings. The sensitivity analyses in the Foreign currency risk is the risk that the fair
following sections relate to the position as at March value or future cash flows of an exposure
31, 2020 and March 31, 2019. The sensitivity will fluctuate because in foreign exchange
analyses have been prepared on the basis that the rates. The Company’s exposure to the risk
of changes in foreign exchange rates relates
amount of net debt, the ratio of fixed to floating primarly to the Company’s operating activities
interest rates of the debt. (when revenue or expense is denominated in
a foreign currency). As on March 31, 2020,

The analysis exclude the impact of movement the Company has following foreign currency
in market variables on the carrying values of exposures:
gratuity and other post retirement obligations and
provisions.
The sensitivity of the relevant profit or loss item is

the effect of the assumed changes in respective
market risks. This is based on the financial assets
and financial liabilities held at March 31, 2020
and March 31, 2019.
126
Notes
March 31, 2020 March 31, 2019
in foreign in foreign
Currency INR INR
currency currency
USD 0.28 21.16 0.42 29.10

Trade payables
EURO 0.01 0.93 0.45 35.24
Foreign currency sensitivity

The following table demonstrate the sensitivity to a reasonable possible change in EUR and USD exchange rates, with all
other variables held constant. The impact on the Companys profit before tax is due to changes in the fair value of monetary
assets and liabilities.
5% increase in foreign exchange rates will have the following impact on profit before tax:
March 31, 2020 March 31, 2019

USD (1.06) (1.45)
EURO (0.05) (1.76)
Note: If the rate is decreased by 500 bps, profit will increase by an equal amount for March 31, 2020 and March 31, 2019
ii. Credit risk

Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract,
leading to a financial loss. The Company is exposed to credit risk from its operating activities (primarily trade
receivables) and from its financing activities, including deposits with banks and financial institutions, other receivables
and deposits, and other financial instruments.
a.
Trade Receivable
The Company mainly sales to its related party and other marquee OEMs and Tier I companies, having
long standing relationship with the Company. Outstanding customer receivables are regularly monitored and
reconciled. At March 31, 2020, receivable from Company’s top 3 customers accounted for approximately
99% (March 31, 2019: 99%) of all the receivables outstanding. An impairment analysis is performed at each
reporting date on an individual basis for major clients. Based on historical experience, the Company does not
have any material bad debts. The Company does not hold collateral as security. The maximum exposure to
credit risk at the reporting date is the carrying value of each class of financial assets. Further, for movement in
provision for doubtful receivables during the year refer note 8.
b. Financial Instrument and Cash Deposit

Credit risk from balances with banks is managed by the Company in accordance with its policy. Investments
of surplus funds are made only with approved counterparties and within credit limits assigned to each
counterparty.
The Company’s maximum exposure to credit risk for the component of balance sheet as at March 31, 2020
and March 31, 2019 is the carrying amounts of trade receivables as illustrated in note 8.
127
Notes
iii. Liquidity risk

The table below summarises the maturity profile of the Company’s financial liabilities based on contractual payments:

Less than 1 year 1 to 5 years >5 years Total
March 31, 2020
Borrowings 41.67 166.67 20.83 229.17
Lease liabilities 16.58 71.73 35.68 123.99
Other financial liabilities 141.45 - - 141.45
Trade payables 1,145.61 - - 1,145.61
1,345.31 238.40 56.51 1,640.22
March 31, 2019
Borrowings 70.97 486.67 172.36 730.00
Other financial liabilities 111.04 - - 111.04
Trade payables 2,579.53 - - 2,579.53
2,761.54 486.67 172.36 3,420.57
41. Capital management

For the purpose of the Company’s capital management, capital includes issued equity capital, securities premium and
all other equity reserves. The primary objective of the Company’s capital management is to maximise the shareholder
value.
The Company manages its capital structure and makes adjustments in light of changes in economic conditions and
the requirements of the financial covenants. To maintain or adjust the capital structure, the Company may adjust the
dividend payment to shareholders, return capital to shareholders or issue new shares. The Company’s gearing ratio,
which is total borrowings divided by total capital employed is as below:
March 31, 2020 March 31, 2019
Borrowings 187.50 659.03

Current maturities of long term debt 41.67 70.97
Total borrowings - A 229.17 730.00
Equity 5,319.37 5,384.40

Total equity-B 5,319.37 5,384.40
Total capital employed - C= (A+B) 5,548.54 6,114.40
Gearing ratio D = (A/C) 4% 12%
128
Notes
42. Transfer Pricing 43. Events after reporting period

The Company maintains the information and documents The Board of Directors recommended a final dividend
as required under the transfer pricing regulations under of INR 0.80/- per equity share for the financial year
Section 92-92F of the Income Tax Act, 1961. The ended March 31, 2020. The payment is subject to the
management is in the process of updating the transfer approval of the shareholders in the ensuing Annual
pricing documentation for the financial year 2019 - 2020 General Meeting of the Company. The final dividend
and is of the view that its transactions are at arm’s length declared in the previous year was INR 19.50/- per
and the aforesaid legislation will not have any impact on equity share.
the financial statements, particularly on the amount of tax
expense and that of provision for taxation.
Kumaradevan Srinivasan Dr. B. N. Kalyani Ranganathan S
per Rajeev Kumar Debadas Panda Senior Vice President & Chairman Chief Financial Officer
Partner Company Secretary Whole time Director DIN: 00089380
Membership No.: 213803 DIN: 08107660
Place : Bengaluru Place : Mysuru Place : Mysuru Place : Pune Place : Mysuru
Date : May 26, 2020 Date : May 26, 2020 Date : May 26, 2020 Date : May 26, 2020 Date : May 26, 2020
129
NOTICE OF 39th ANNUAL GENERAL MEETING
Notice is hereby given that the 39th Annual General Meeting SPECIAL BUSINESS:
(AGM) of the Members of Automotive Axles Limited, will be Item No. 5 – Appointment of Mr. Srinivasan
held on Wednesday, 19th August, 2020 at 3.00 PM (IST) Kumaradevan as Whole Time Director of the
through Video Conferencing (VC) facility or other audio Company:
visual means (OAVM) to transact the following business: To consider and if thought fit to pass the following resolution
as an Ordinary Resolution:
ORDINARY BUSINESS:
Item No. 1 – Adoption of Audited Standalone ““Resolved that pursuant to provisions of Articles of
Financial Statement Association, Sections 160, 196, 197 and 203 read
To receive, consider and adopt the Financial Statements of the with Schedule V and other applicable provisions of the
Company for the year ended March 31, 2020, including the Companies Act, 2013 and Companies (Appointment and
audited Balance Sheet of the Company as at March 31, 2020 Qualification of Directors) Rules, 2014, and the applicable
and Statement of Profit & Loss for the year ended on that date clauses of SEBI (LODR) Regulations, 2015 including
and the Reports of Board of Directors and Auditors thereon. any statutory modification(s) or re-enactment thereof for
the time being in force, approval of members be and is
Item No.2 – Confirmation for payment of Interim hereby accorded to appoint Mr. Srinivasan Kumaradevan
Dividend (DIN: 08107660) who was appointed Additional Director of
To confirm the interim dividend of Rs. 6/- per equity share of the Company by the Board of Directors in its meeting held
Rs.10/- each for the financial year 2019-20. on 14th August 2019 and who holds office up to the date
of this Annual General Meeting (AGM) in terms of Section
Item No. 3 – Declaration of Final Dividend 161 of the Act and Clause 117 of the Articles of Association
To declare final dividend on equity shares at Rs. 0.80 per of the Company and who is eligible for appointment and
equity share of Rs. 10/- each for the financial year 2019-20 has consented to act as Director of the Company as Whole
Time Director designated as Sr. Vice President & Whole
Item No. 4 – Re-appointment of a Director Time Director of the Company for a period of five (5) years
To appoint a director in place of Dr. B. N. Kalyani, effective 14th August 2019 on the terms and conditions
(DIN: 00089380) who retires by rotation in terms of sec including remuneration as set out in the explanatory
152(6) of the Companies Act, 2013 and being eligible statement forming part of this Notice.
offers himself for re-appointment.
By Order of the Board of Directors

For Automotive Axles Limited
Debadas Panda
Company Secretary
Registered Office: Hootagalli Industrial Area

Off Hunsur Road,
Mysuru 570 018, Karnataka
CIN : L51909KA1981PLC004198
Phone No. : 0821-7197500
Place: Mysuru Email : sec@autoaxle.com
Date: 26th May, 2020 Web : www.autoaxle.com
130
Notes: FOR APPOINTMENT OF PROXIES BY THE

1.
In view of the outbreak of Covid-19 pandemic, MEMBERS WILL NOT BE AVAILABLE FOR THIS
the Ministry of Corporate Affairs (‘MCA‘) has vide AGM AND HENCE THE PROXY FORM IS NOT
its General Circular dated May 5, 2020 read with ANNEXED.
General Circulars dated April 8, 2020 and April 13,
2020 (collectively referred to as ‘MCA Circulars‘) 4. Since the meeting is proposed to be held through VC/
permitted the holding of the Annual General Meeting OAVM attendance slip and route map of AGM are not
(‘AGM‘) through Video Conferencing (‘VC’) facility annexed to this notice.
or other audio visual means(‘OAVM’), without the
physical presence of the Members at a common venue. 5. National Securities Depositories Limited (“NSDL”) will
Similar relaxation has been provided by the Securities be providing facility for voting through remote e-Voting,
and Exchange Board of India vide its circular dated for participation in the 39th AGM through VC/OAVM
12th May 2020 (‘SEBI Circular’). In compliance with the Facility and e-Voting during the 39th AGM.
provisions of the Companies Act, 2013 (‘Act‘), Securities
and Exchange Board of India (Listing Obligations and 6. Institutional Investors, who are Members of the
Disclosure Requirements) Regulations, 2015 (‘Listing Company, are encouraged to attend and vote at the 39th
Regulations‘), SEBI Circular and MCA Circulars, the AGM through VC/OAVM facility. Corporate Members
AGM of the Company is being held through VC/ intending to appoint their authorised representatives
OAVM on Wednesday, August 19th 2020 at 3.00 p.m. pursuant to Sections 112 and 113 of the Act, as the
(IST). The deemed venue for the 39th AGM will be at case maybe, to attend the AGM through VC/OAVM
the registered office of the Company at Hootagalli or to vote through remote e-Voting are requested to
Industrial Area, Off Hunsur Road, Mysuru – 570 018, send a certified copy of the Board Resolution to the
Karnataka, Scrutinizer by e-mail at cscapracheta@gmail.com with
a copy marked to evoting@nsdl.co.in.
2. The Explanatory Statement pursuant to Section 102 of
the Companies Act, 2013 in respect of the business 7.
The attendance of the Members attending the AGM
under Item No.5 as set out above and details as through VC/OAVM will be counted for the purpose of
required under SEBI (Listing Obligations and Disclosure reckoning the quorum under Section 103 of the Act.
Requirements) Regulations, 2015 and Secretarial
Standard on General meetings issued by the Institute 8. The Members can join the AGM in the VC/OAVM mode
of Company Secretaries of India, in respect of Directors 30 minutes before and 15 minutes after the scheduled
seeking appointment/re-appointment at this Annual time of the commencement of the Meeting by following
General Meeting (AGM) are annexed hereto. The the procedure mentioned in the Notice. The Members
Board of Directors of the Company at its meeting held will be able to view the proceedings by logging into
on 26th May 2020 considered that the special business the National Securities Depository Limited’s (‘NSDL’)
under Item No. 5, being considered unavoidable, be e-Voting website at www.evoting.nsdl.com. The facility
transacted at the 39th AGM of the Company. of participation at the AGM through VC/OAVM will be
made available to at least 1,000 Members on a first
come first served basis as per the MCA Circulars.
3. PURSUANT TO THE PROVISIONS OF THE ACT, A
MEMBER ENTITLED TO ATTEND AND VOTE AT 9.
In line with the MCA General Circular dated May 5,
THE AGM IS ENTITLED TO APPOINT A PROXY 2020, the Notice of the AGM along with the Annual
TO ATTEND AND VOTE ON HIS/HER BEHALF Report 2019-20 is being sent only through electronic
AND THE PROXY NEED NOT BE A MEMBER OF mode to those Members whose e-mail addresses are
THE COMPANY. SINCE THIS AGM IS BEING registered with the Company/Depositories. The Notice
HELD PURSUANT TO THE MCA CIRCULARS convening the 39th AGM has been uploaded on the
THROUGH VC/OAVM, THE REQUIREMENT OF website of the Company at https://www.autoaxle.com
PHYSICAL ATTENDANCE OF MEMBERS HAS under ‘Investor Relations’ section and may also be
BEEN DISPENSED WITH. ACCORDINGLY, IN accessed on the websites of the Stock Exchanges i.e.
TERMS OF THE MCA CIRCULARS, THE FACILITY BSE Limited and the National Stock Exchange of India
131
Limited at www.bseindia.com and www.nseindia.com the dividend paid on shares held in electronic form.
respectively. The Notice is also available on the website
of NSDL at www.evoting.nsdl.com. 11. As per Regulation 40 of the Listing Regulations, as
amended, securities of listed companies can be
10. Further, in order to receive the dividend in a timely transferred only in dematerialised form with effect
manner, Members holding shares in physical form from April 1, 2019, except in case of request received
who have not updated their mandate for receiving for transmission or transposition of securities. In
the dividends directly in their bank accounts through view of this and to eliminate all risks associated with
Electronic Clearing Service or any other means are physical shares and for ease of portfolio management,
requested to send a scanned copy of the following Members holding shares in physical form are requested
details/documents to our Registrar and Share Transfer to consider converting their holdings to dematerialised
Agent, Integrated Registry Management Services Private form. Members can contact the Company’s Registrar
Limited latest by Friday, July 31, 2020: and Share Transfer Agent, Integrated Registry
Management Services Private Limited, for assistance in
a) a signed request letter mentioning your name, folio this regard.
number, complete address and following details
relating to bank account in which the dividend is 12. Members are requested to intimate changes, if any
to be received: pertaining to their name, postal address, e-mail
address, telephone/mobile numbers, PAN, registering
i. Name and Branch of Bank and Bank Account of nomination, power of attorney registration, Bank
type; Mandate details, etc. to their DPs in case the shares
are held in electronic form and to the Registrar and
ii.
Bank Account Number and type allotted Share Transfer Agent, Integrated Registry Management
by your bank after implementation of Core Services Private Limited, in case the shares are held
Banking Solutions; in physical form, quoting their folio number. Further,
Members may note that Securities and Exchange Board
iii. 11 digit IFSC Code. of India (‘SEBI’) has mandated the submission of PAN
by every participant in the securities market.
b)
self-attested scanned copy of cancelled cheque
bearing the name of the Member or first holder, in 13.The register of Members and Share Transfer Books will
case shares are held jointly; remain closed from 14th August, 2020 to 19th August,
2020 (both days inclusive) for determining the names
c) self-attested scanned copy of the PAN Card; and of the members eligible for final dividend on equity
shares, if declared at the meeting.
d) self-attested scanned copy of any document (such
as Aadhaar Card, Driving License, Election Identity 14. Dividend on Equity Shares as recommended by the
Card, Passport) in support of the address of the Board of Directors, if declared at the meeting, will be
Member as registered with the Company. paid to the members whose names appear –
Members holding shares in electronic form may please i) As beneficial owners of the shares as per list to
note that their bank details as furnished by the respective be furnished by the depositories in respect of the
Depositories to the Company will be considered for shares held in de-mat form on the closing hours of
remittance of dividend as per the applicable regulations the business on Thursday, 13th August, 2020 and
of the Depositories and the Company will not entertain
any direct request from such Members for change/ ii) As Members on the Register of Members of the
addition/deletion in such bank details. Accordingly, the Company as on Thursday, 13th August, 2020 after
Members holding shares in demat form are requested giving effect to all valid shares transfer in physical
to update their Electronic Bank Mandate with their form which would be received by the Company
respective DPs. end of the business hours on 13th August, 2020
Further, please note that instructions, if any, already 15. Pursuant to the Finance Act, 2020, dividend income will
given by the Members in respect of shares held in be taxable in the hands of the Shareholders with effect
physical form, will not be automatically applicable to from April 1, 2020 and the Company is required to
deduct TDS from dividend paid to the Members at
132
prescribed rates under the Income Tax Act, 1961 Year Particulars
Date of Due date of
Declaration Transfer
(‘IT Act’).In general, to enable compliance with TDS
requirements, Members are requested to complete and/ 2012-13 20% Dividend 10-Feb-2014 18-Mar-2021
2013-14 25% Dividend 05-Feb-2015 12-Mar-2022
or update their Residential Status, Permanent Account
2014-15 10% Dividend 05-Aug-2015 10-Sep-2022
Number (‘PAN’), category as per the IT Act with their
2015-16 55% Dividend 12-Aug-2016 15-Sep-2023
Depository Participants (‘DPs’) or in case shares are 2016-17 80% Dividend 18-Aug-2017 21-Sep-2024
held in physical form, with the Company by sending 2017-18 135% Dividend 13-Aug-2018 15-Sep-2025
documents through e-mail by Friday, 31st July, 2020. 2018-19 195% Dividend 14-Aug-2019 16-Sep-2026
2019-20 60% Dividend 02-Mar-2020 6-April-2027
i)
A Resident individual shareholder with Permanent
Account Number (‘PAN’) and who is not liable to pay 18. The Members who are unable to receive the dividend
income tax can submit a yearly declaration in Form directly in their bank accounts through Electronic
No 15G/15H, to avail the benefit of non-deduction Clearing Service or any other means, due to non-
of tax at source by email to irg@integratedindia.in registration of the Electronic Bank Mandate, the
by 31st July, 2020. Shareholders are requested to Company shall despatch the dividend warrant/
note that in case their PAN is not registered, the tax bankers’ cheque/demand draft to such Members, upon
will be deducted at a higher rate of 20%. normalisation of postal services and other activities
ii)
Non-Resident shareholders can avail beneficial 19. Members of the Company holding shares either in
rates under tax treaty between India and their physical form or in electronic form as on the cut-off
country of residence, subject to providing necessary date of 13th August, 2020 may cast their vote by remote
documents i.e. No Permanent Establishment and e-Voting. The remote e-Voting period commences on
Beneficial Ownership Declaration, Tax Residency Sunday, 16th August, 2020 at 9.00 a.m. (IST) and ends
Certificate, Form 10F, any other document which on Tuesday, 18th August, 2020 at 5.00 p.m. (IST). The
may be required to avail the tax treaty benefits by remote e-Voting module shall be disabled by NSDL
forwarding the above documents by email to irg@ for voting thereafter. Once the vote on a resolution is
integratedindia.in. The aforesaid declarations cast by the Member, the Member shall not be allowed
and documents need to be submitted by the to change it subsequently. The voting rights of the
shareholders by 31st July, 2020. Members (for voting through remote e-Voting before/
during the AGM) shall be in proportion to their share
16. The Securities and Exchange Board of India (SEBI) of the paid-up equity share capital of the Company as
has mandated the submission of Permanent Account on the cut-off date of 13th August , 2020.
Number (“PAN”) by every participant in securities
market. Members holding shares in electronic form 20. Members will be provided with the facility for voting
are, therefore, requested to submit the PAN to their through electronic voting system during the VC/OAVM
Depository Participants and Members holding shares proceedings at the AGM and Members participating
in physical form can submit their PAN details to our at the AGM, who have not already cast their vote by
Registrar & Share Transfer Agent. remote e-Voting, will be eligible to exercise their right
to vote during such proceedings of the AGM. Members
17. Those Members who have so far not encashed their who have cast their vote by remote e-Voting prior to the
Dividend Warrants for the below mentioned Financial AGM will also be eligible to participate at the AGM but
Years, may claim or approach the Company’s Registrar shall not be entitled to cast their vote again.
& Share Transfer Agents for the payment thereof, as the
same will be transferred to the Investor Education and 21. Pursuant to the provisions of Section 108 of the Act
protection Fund (‘IEPF’) of the Central Government, read with Rule 20 of the Companies (Management and
pursuant to section 124 of the Companies Act, 2013, on Administration) Rules, 2014 (as amended) and Regulation
the respective due date(s) mentioned there against. Kindly 44 of the Listing Regulations, as amended and the MCA
note that after such date, the members will not be entitled Circulars, the Company is providing facility of remote
to claim such dividend from the Company. The members e-Voting to its Members in respect of the business to be
may also note that as per the new provisions, the shares transacted at the AGM. For this purpose, the Company
on which dividend remains unclaimed for a continuous has entered into an agreement with NSDL for facilitating
period of 7 years, shall also be transferred to IEPF. voting through electronic means, as the authorised
133
agency. The facility of casting votes by a Member using 27. Instructions for attending the AGM
remote e-Voting system as well as e-Voting system during through VC/OAVM and e-Voting (before
the AGM will be provided by NSDL. and during the AGM) are given below:
A. INSTRUCTIONS FOR MEMBERS FOR
22.A person whose name is recorded in the Register of ATTENDING THE AGM THROUGH VC/OAVM
Members or in the Register of Beneficial Owners 1. Members will be able to attend the AGM through VC
maintained by the depositories as on the cut-off date / OAVM or view the live webcast of AGM provided
only shall be entitled to avail the facility of remote by NSDL at https://www.evoting.nsdl.com by using
e-Voting before as well as during the AGM. Any person their remote e-voting login credentials and selecting
who acquires shares of the Company and becomes the EVEN for Company’s AGM. Members who do not
a Member of the Company after the despatch of the have the User ID and Password for e-voting or have
Notice and holding shares as on the cut-off date forgotten the User ID and Password may retrieve the
i.e. 13th August, 2020, may obtain the User ID and same by following the remote e-voting instructions
password by sending a request at evoting@nsdl.co.in. mentioned in the Notice. Further Members can also
use the OTP based login for logging into the e-voting
23.Ms. Pracheta M., Practising Company Secretary has system of NSDL.
been appointed as the Scrutinizer to scrutinize the
remote e-Voting process and casting vote through 2.
Members may join the Meeting through Laptops,
the e-Voting system during the meeting in a fair and Smartphones, Tablets and iPads for better experience.
transparent manner. Further, Members will be required to use Internet with
a good speed to avoid any disturbance during the
24.The Chairman shall, after response to the questions Meeting. Please note that participants connecting
raised by the Members in advance or as a speaker at from Mobile Devices or Tablets or through Laptops
the AGM, formally conclude the meeting by use of connecting via mobile hotspot may experience Audio/
remote e-all those Members who are present during the Video loss due to fluctuation in their respective network.
AGM through VC/OAVM but have not cast their votes It is therefore recommended to use stable Wi-Fi or LAN
by availing the remote e-Voting facility shall be allowed connection to mitigate any glitches.
to vote through e-voting system. The e-Voting module
during the AGM shall be disabled by NSDL for voting 3. Facility of joining the AGM through VC / OAVM shall
15 minutes after the conclusion of the Meeting open 30 minutes before the time scheduled for the
AGM and will be available for Members on first come
25.The Scrutinizer will submit her report to the Chairman first served basis.
or to any other person authorised by the Chairman
after the completion of the scrutiny of the e-Voting 4. Members who need assistance before or during the
(votes cast during the AGM and votes cast through AGM, can contact NSDL on evoting@nsdl.co.in /
remote e-Voting), not later than 48 hours from the 1800-222-990 or contact:
conclusion of the AGM. The results declared along with
the Scrutinizer’s report shall be communicated to the Name of the concerned person: Sarita Mote
Stock Exchanges on which the Company’s shares are Contact details: + 91 22 24994890
listed, NSDL and RTA and will also be displayed on the
Company’s website at https://www.autoaxle.com. 5.
Members are encouraged to submit their questions
in advance with regard to the financial statements or
26. Members may also note that the Notice of the 39th any other matter to be placed at the AGM from their
Annual General Meeting and the Annual Report for registered e-mail address, mentioning their name, DP
2020 will also be available on the Company’s website ID and Client ID number/folio number and mobile
www.autoaxle.com for their download. The physical number to reach the Company’s e-mail address at
copies of the aforesaid documents will also be available sec@autoaxle.com before 3.00 p.m. (IST) on Monday,
at the Company’s Registered Office in Mysuru for August 17, 2020. Such questions by the Members shall
inspection during normal business hours on working be suitably replied to by the Company.
days. For any communication, the shareholders may
also send requests to the Company’s investor email id: 6. Members who would like to express their views or ask
sec@autoaxle.com.
134
Manner of holding shares Your User id is

questions during the AGM may register themselves as i.e. Demat (NSDL or CDSL)
a speaker by sending their request from their registered or Physical
email address mentioning their name, DP ID and a) For Members who 8 Character DP ID followed by 8
Client ID/folio number, PAN, mobile number at sec@ hold shares in demat Digit Client ID
autoaxle.com from Saturday, August 15, 2020 (9:00 account with NSDL. For example if your DP ID is
a.m. IST) to Monday, August 17, 2020 (5:00 p.m. IST). IN300*** and Client ID is
Those Members who have registered themselves as a 12****** then your user ID is
IN300***12******.
speaker will only be allowed to express their views/ask
questions during the AGM. The Company reserves the b) For Members who 16 Digit Beneficiary ID
right to restrict the number of speakers depending on hold shares in demat For example if your Beneficiary ID
account with CDSL. is 12************** then your user
the availability of time for the AGM.
ID is 12**************
c) For Members holding EVEN Number followed by Folio
B. THE INSTRUCTIONS FOR E-VOTING BEFORE / shares in Physical Number registered with the
DURING THE AGM Form. company
The way to vote electronically on NSDL e-Voting system For example if folio number is
consists of “Two Steps” which are mentioned below: 001*** and EVEN is 101456 then
user ID is 101456001***
Step 1: Log-in to NSDL e-Voting system at 5. Your password details are given below
https://www.evoting.nsdl.com/ a) If you are already registered for e-Voting, then
you can use your existing password to login
Step 2: Cast your vote electronically on NSDL and cast your vote.
e-Voting system.
b) If you are using NSDL e-Voting system for the
Details on Step 1 is mentioned below: first time, you will need to retrieve the ‘initial
password’ which was communicated to you.
How to Log-in to NSDL e-Voting website? Once you retrieve your ‘initial password’,
1.
Visit the e-Voting website of NSDL. Open web you need to enter the ‘initial password’ and
browser by typing the following URL: https://www. the system will force you to change your
evoting.nsdl.com/ either on a Personal Computer password.
or on a mobile.
c) How to retrieve your ‘initial password’?
2.
Once the home page of e-Voting system is (i) If your email ID is registered in your
launched, click on the icon “Login” which is demat account or with the company,
available under ‘Shareholders’ section. your ‘initial password’ is communicated
to you on your email ID. Trace the
3. A new screen will open. You will have to enter your email sent to you from NSDL from your
User ID, your Password and a Verification Code as mailbox. Open the email and open the
shown on the screen. attachment i.e. a .pdf file. Open the .pdf
file. The password to open the .pdf file is
Alternatively, if you are registered for NSDL eservices your 8 digit client ID for NSDL account,
i.e. IDEAS, you can log-in at https://eservices.nsdl. last 8 digits of client ID for CDSL account
com/ with your existing IDEAS login. Once you or folio number for shares held in
log-in to NSDL eservices after using your log-in physical form. The .pdf file contains your
credentials, click on e-Voting and you can proceed ‘User ID’ and your ‘initial password’.
to Step 2 i.e. Cast your vote electronically.
(ii) If your email ID is not registered please
4. Your User ID details are given below : follow steps mentioned below
135
Physical Please send a request to the 2. After click on Active Voting Cycles, you will be able to
Holding Registrar and Share Transfer Agents see all the companies “EVEN” in which you are holding
of the company, Integrated Registry shares and whose voting cycle is in active status.
Management Services Private Ltd at
irg@integratedindia.in providing Folio
No, name of the shareholder, scanned
3. Select “EVEN” of company for which you wish to
copy of the certificate (Front and cast your vote.
Back), PAN (Self Attested copy of PAN
card), AADHAR (Self Attested Copy of 4. Now you are ready for e-Voting as the Voting
AADHAR card) for registering email page opens.
address.
Demat Please contact your Depository 5. Cast your vote by selecting appropriate options
Holding Participant (DP) and register your email i.e. assent or dissent, verify/modify the number
address in your demat account, as per
of shares for which you wish to cast your vote
the process provided by the DP.
and click on “Submit” and also “Confirm” when
prompted.
6. If you are unable to retrieve or have not received
the “ Initial password” or have forgotten your 6.
Upon confirmation, the message “Vote cast
password: successfully” will be displayed.
a)
Click on “Forgot User Details/Password”(If 7. You can also take the printout of the votes cast
you are holding shares in your demat account by you by clicking on the print option on the
with NSDL or CDSL) option available on www. confirmation page.
evoting.nsdl.com.
8. Once you confirm your vote on the resolution, you
b)
Physical User Reset Password (If you are will not be allowed to modify your vote.
holding shares in physical mode) option
available on www.evoting.nsdl.com. General Guidelines for shareholders
1 Institutional shareholders (i.e. other than individuals,
c) If you are still unable to get the password by HUF, NRI etc.) are required to send scanned copy
aforesaid two options, you can send a request (PDF/JPG Format) of the relevant Board Resolution/
at evoting@nsdl.co.in mentioning your demat Authority letter etc. with attested specimen signature of
account number/folio number, your PAN, your the duly authorized signatory(ies) who are authorized
name and your registered address. to vote, to the Scrutinizer by e-mail to cscapracheta@
gmail.com with a copy marked to evoting@nsdl.co.in.
d) Members can also use the OTP (One Time
Password) based login for casting the votes 2. It is strongly recommended not to share your password
on the e-Voting system of NSDL. with any other person and take utmost care to keep your
password confidential. Login to the e-voting website
7. After entering your password, tick on Agree to “Terms will be disabled upon five unsuccessful attempts to key
and Conditions” by selecting on the check box. in the correct password. In such an event, you will need
to go through the “Forgot User Details/Password” or
8. Now, you will have to click on “Login” button “Physical User Reset Password” option available on
www.evoting.nsdl.com to reset the password.
9. After you click on the “Login” button, Home page
of e-Voting will open. 3. In case of any queries, you may refer the Frequently
Asked Questions (FAQs) for Shareholders and
Details on Step 2 is mentioned below e-voting user manual for Shareholders available at
How to cast your vote electronically on NSDL e-Voting system? the download section of www.evoting.nsdl.com or call
1. After successful login at Step 1, you will be able to on toll free no.: 1800-222-990 or send a request at
see the Home page of e-Voting. Click on e-Voting. evoting@nsdl.co.in
Then, click on Active Voting Cycles.
136
ANNEXURE TO NOTICE 8 Company’s contribution to Provident Fund, Gratuity and

Superannuation Fund, Annuity Fund as per the Rules of the Company
EXPLANATORY STATEMENT PURSUANT TO
SECTION 102 OF THE COMPANIES ACT, 2013 9 Other benefits including telephone expenses as per the
Pursuant to section 102 of the Companies Act, 2013 (Act), the company policy
following Explanatory Statement sets out all the material facts 10 Increment in remuneration from time to time as per the
relating to the business mentioned under Item No. 5 of the company policy.
accompanying Notice dated 26th May, 2020. The income tax shall be borne by Mr. Srinivasan Kumaradevan
and shall be deducted at source by the Company.
Item No.5
The Board of Directors of the Company (‘the Board’) Mr. Srinivasan Kumaradevan satisfies the conditions as
at its meeting held on 14th August, 2019 has, subject set out in the Part I of the Schedule V of the Act and also
to the approval of members, appointed Mr. Srinivasan conditions as set out under sub section(3) of section 196
Kumaradevan (DIN: 08107660) Whole Time Director of the Act being eligible for re-appointment. He is not
designated as Sr. Vice President & Whole Time Director for disqualified from being re-appointed as Director in terms of
a period of five (5) years effective on existing terms and section 164 of the Act.
conditions as below on recommendation of Nomination &
Remuneration Committee. Considering his vast experience, his presence on the Board
will be of immense value to the Company and accordingly,
It is proposed to seek members approval for appointment of the Board recommends the Resolution at Item No.5 for
and remuneration payable to him in terms of the applicable approval by the Members
provisions of the act.
Mr. Srinivasan Kumaradevan is not related to any other
Period of From 14.08.2019 to Directors of the Company.
S.N.
Appointment 13.08.2024
1 Salary Basic `2,20,000/- per month A notice under Section 160 of the Companies Act, 2013
2 House Rent Allowance `88,000/- per month is received from a member of the company proposing
3 Special Allowance `1,59,000/- per month candidature of Mr. Srinivasan Kumaradevan.
4 Superannuation `33,000/- per month
Allowance Except Mr. Srinivasan Kumaradevan, none of the other
5 LTA `2,20,000/- per annum
Directors, Key Managerial Personnel or their relatives are
6 Annual Performance `10,00,000/- per annum
concerned or interested, financially or otherwise in Item
Incentive (Max Limit)
No.5 of the Notice.
7 Conveyance Company Car + Driver + Fuel
(Max 200 Ltr. of petrol per month)
Additional information as required under Standard 1.2.5 of Secretarial Standards-2 and Listing Regulations
Particulars Mr. Srinivasan Kumaradevan
Age 53 years
Qualification B.E in Mechanical Engineering from Bangalore University & Masters in
Manufacturing Systems Engineering from Warwick University, UK.
Experience More than 30 Years
Terms of appointment/re-appointment Appointed as Sr. Vice President & Wholetime Director of the Company as per
item No.5 of the Notice of AGM
Remuneration sought to be paid As per details mentioned in the explanatory statement
Remuneration last drawn INR 80,30,231/- During 2019-20
Date of first appointment at the Board 14.08.2019
Shareholding in the Company Nil
Relationship with other directors and Key Managerial No relationship
Personnel
Number of Board meetings attended during the year 3 (Three)
2019-20
Other Directorships (including Listed entities) None other than Automotive Axles Limited
Membership/Chairmanship of Committees of other Not Applicable as not member of any other Board. (Member of Shareholders
Board Relationship Committee, Corporate Social Responsibility Committee and Risk
Management Committee at Automotive Axles Limited)
137

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39th Annual Report 2019-20

PBT (` in mn) PAT (` in mn)

NETWORTH (` in mn) EPS (`)

5,384.40 5,319.37 80.43

We expected a decent performance for FY 2020-21, but

Despite growing focus on technology, our people continue

Dividend Transfer of unpaid or unclaimed amount

Familiarization program for the Board (e) 

Explanation for observations made under Meetings of the Board

Risk Management System Business Responsibility Report

Corporate Social Responsibility (CSR): Disclosure under the Sexual Harassment

For and on behalf of the Board of Directors

Place : Pune B. N. Kalyani

To, (v) The following Regulations and Guidelines prescribed

3. In case of imported technology (imported during the NIL

4. Expenditure on R & D NIL

C. Foreign Exchange Earnings and Outgo:

b. Total Foreign Exchange used and Earned:

For and on behalf of the Board of Directors

Place : Pune B. N. Kalyani

 atio of Remuneration of each Director to the Median remuneration of the Employees

1 Dr. B N Kalyani Chairman, Non – Executive Director 0.35:1 300%

Place : Pune B. N. Kalyani

I. REGISTRATION AND OTHER DETAILS

II. PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY

III. PARTICULARS OF HOLDING, SUBSIDIARY AND ASSOCIATE COMPANIES

i. Category-wise Share Holding

Total Shareholding 10735081 - 10735081 71.04 10735081 - 10735081 71.04

f) Insurance Companies - - - - 619156 - 619156 4.10 4.10

Clearing Member 41281 - 41281 0.27 25320 - 25320 0.17 -0.10

ii. Shareholding of Promoters

iii. Change in Promoters’ Shareholding (please specify, if there is no change)

Shareholding at the beginning of the Shareholding at the end of the

SHAREHOLDING AT THE CUMULATIVE

2 BAJAJ ALLIANZ 597713 3.96 01.04.2019 0 - 597713 3.96

SHAREHOLDING AT THE CUMULATIVE

3 RELIANCE CAPITAL 400000 2.65 01.04.2019 0 400000 2.65

4 EMERGING MARKETS 55057 0.36 01.04.2019 0 - 55057 0.36

5 IIFL SECURITIES 47611 0.32 01.04.2019 0 47611 0.32

6 RELIANCE CAPITAL 45000 0.30 01.04.2019 0 45000 0.30

7 CANARA ROBECO 37806 0.25 01.04.2019 0 37806 0.25

SHAREHOLDING AT THE CUMULATIVE

9 THE EMERGING 36800 0.24 01.04.2019 0 36800 0.24

10 INVESTOR 31536 0.21 01.04.2019 0 31536 0.21

11 UTI 28227 0.19 01.04.2019 0 28227 0.19

SHAREHOLDING AT THE CUMULATIVE

12 KAMLESH NAVIN 0 0.00 01.04.2019 0 0 0.00

13 KAMAL NAYAN 0 0.00 01.04.2019 0 0 0.00

14 NOVEL SUPPLIERS 27118 0.18 01.04.2019 No Movement during the year

*Reasons for Change

V. Shareholding of Directors and Key Managerial Personnel:

VII. Remuneration of Directors & Key Managerial Personnel :

Dr. N Muthukumar Kumaradevan Srinivasan,

B. Remuneration to other directors:

Sitting Fee 0.20 Nil 0.20

Overall Ceiling as per the Act * `1.00 Lac Per

C. Remuneration to Key Managerial Personnel Other Than MD /Manager /WTD

Sl. Ranganathan S CFO

Familiarization program for the Board (e)

To, (v) The following Regulations and Guidelines prescribed

atio of Remuneration of each Director to the Median remuneration of the Employees

1.6. To devise a policy on Board diversity. 3.1.3.

2.4.1. Whole-time Directors; 3.1.6. Recommend to the board, all remuneration,

3.3.3. Remuneration to Non- Executive / 5. CHAIRPERSON

10. NOMINATION DUTIES 10.10

industry-specific health and safety issues among our people.

Fixed electric chain hoists cross beams and longitudinal

Distributed eco-friendly Ganesha idols to all employees Risk management

Risk What it means Mitigation Technology The failure to Monitor emerging

Oversight of Company’s financial reporting system;

Performance of Non-Independent Directors d)

b) Adherence to ethical standards and code of conduct of

Compliance Officer To act in terms of any consequent statutory modification(s)