Your Directors have pleasure in presenting the 39th annual report together with the audited financial statements for the year ended 31st March, 2020.

Financial Results

The Company's financial performance during 2019-20 as compared to the previous year 2018-19 is summarised below:

*net of income tax of Rs 200 million (previous year Rs 151 million)

Financial Highlights

The total revenue was Rs 790,314 million as against Rs 885,813 million in the previous year showing a decrease of 10.78%. Sale of vehicles in the domestic market was 1,461,126 units as compared to 1,753,700 units in the previous year showing a decrease of 16.7%. Total number of vehicles exported was 102,171 units as compared to 108,749 units in the previous year showing a decrease of 6.05%.

Profit before tax (PBT) was Rs 70,648 million against Rs 104,656 million showing a decrease of 32.50% and profit after tax (PAT) stood at Rs 56,506 million against Rs 75,006 million in the previous year showing a decrease of 24.66%.

Dividend

The Board recommends a dividend of Rs 60/- per equity share of Rs 5/- each for the year ended 31st March, 2020 amounting to Rs 18,125 million. The Company has formulated a dividend distribution policy which forms part of the annual report. No amount was carried to General Reserve.

Operational Highlights

The operations are exhaustively discussed in the ‘Management Discussion and Analysis' forming part of the annual report.

Consolidated Financial Statements

In accordance with Indian Accounting Standard (IND AS) - 110 on Consolidated Financial Statements read with Indian Accounting Standard (IND AS) - 28 on Investments in Associates and Joint Ventures, the audited consolidated financial statements are provided in the annual report.

A report containing the names of the companies which have become or ceased to become subsidiaries, joint ventures and associates, their performance, financial position and their contribution to the overall performance of the Company as required by the Companies Act, 2013 (‘Act') is provided as an annexure to the consolidated financial statements and hence are not repeated here for the purpose of brevity. (Form AOC-1).

Annual Return

The details forming part of the extract of the annual return in Form MGT-9 is attached as Annexure - A. The annual return of the Company for the year 2018-19 is available on its website at https:// www.marutisuzuki.com/corporate/investors/company-reports

Material Subsidiaries

In accordance with Regulation 16(1)(c) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (‘Listing Regulations'), the Company has a policy for determining material subsidiaries. The policy is available on its website at https://marutistoragenew.blob.core.windows.net/msilintiwebpdf/ Policy on Subsidiary Companies.pdf

Particulars of Loans, Guarantees and Investments

Details of loans, guarantees and investments, if any, covered under the provisions of Section 186 of the Act are given in the notes forming part of the financial statements.

Board Meetings

A calendar of meetings is prepared and circulated in advance to the Directors. During the year, five board meetings were held, the details of which are given in the Corporate Governance Report

Audit Committee

For composition of the audit committee, please refer to the Corporate Governance Report.

Independent Directors

The Company has received declarations of independence in accordance with the provisions of Section 149 of the Act and Listing Regulations from all the Independent Directors. Under the relevant provisions of the Companies Act and the Listing Regulations, one separate meeting of the Independent Directors was held during 2019-20. The Board is of the opinion that the Independent Directors of the Company possess requisite qualifications, experience and expertise and hold highest standards of integrity. The details of the familiarisation programmes for the Independent Directors are available on the website of the Company at https://marutistoragenew.blob.core. windows.net/msilintiwebpdf/Familiarization Programme.pdf

Directors' Responsibility Statement

To the best of their knowledge and belief and according to the information and explanations obtained, in terms of Section 134 of the Act, your Directors state that:

a) in the preparation of the annual accounts, the applicable accounting standards have been followed and proper explanations provided relating to material departures, if any;

b) such accounting policies have been selected and applied consistently and judgments and estimates made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period;

c) proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d) the annual accounts have been prepared on a going concern basis;

e) internal financial controls were followed by the Company and they are adequate and are operating effectively; and

f) proper systems have been devised to ensure compliance with the provisions of all applicable laws and such systems are adequate and operating effectively

Directors and Key Managerial Personnel (KMP)

Mr. K. Ayukawa and Mr. T. Hashimoto shall retire by rotation in the ensuing Annual General Meeting of the Company and, being eligible, have offered themselves for re-appointment.

Ms. Lira Goswami was appointed as an Independent Director in the last Annual General Meeting (AGM) for a period of five years from 28th August, 2019 to 27th August, 2024. Mr. D. S. Brar and Mr. R. P. Singh were re-appointed as Independent Directors in the last AGM for a period of five years from 28th August, 2019 to 27th August, 2024. Ms. Renu Sud Karnad, Independent Director, resigned with effect from close of the business hours of 31st March, 2020 due to the reasons given in the Corporate Governance Report. On the recommendation of the Nomination and Remuneration Committee, the Board appointed Mr. Maheswar Sahu as an Independent Director for a period of five years with effect from 14th May, 2020 till 13th May, 2025 subject to the approval of the shareholders in the Annual General Meeting. Pursuant to the nominations by Suzuki Motor Corporation, Mr. Seiji Kobayashi was appointed as a Non-executive Director with effect from 25th October, 2019 and held his office till 4th December, 2019. Mr. Hiroshi Sakamoto was appointed as a Non-executive Director with effect from 27th July, 2019 and held his office till 24th October, 2019. Mr. Kenichiro Toyofuku was appointed as an Additional Director and Whole-time Director designated as Director (Corporate Planning) with effect from 5th December, 2019.

Risk Management

Pursuant to Regulation 21 of Listing Regulations, the Company has a Risk Management Committee, the details of which are given in the Corporate Governance Report. The Company has a Risk Management Policy and identified risks and taken appropriate steps for their mitigation. For more details, please refer to the Management Discussion and Analysis (MD&A).

Internal Financial Controls

Internal financial controls have been discussed under ‘CEO/CFO Certification' in the Corporate Governance Report.

Vigil Mechanism

The Company has in place an established and effective mechanism called the Whistle Blower Policy (Policy). The mechanism under the Policy has been appropriately communicated within the organisation. The purpose of this Policy is to provide a framework to promote responsible whistle blowing by employees. It protects employees wishing to raise concerns about serious irregularities, unethical behavior, actual or suspected fraud within the Company.

The Chairman of the audit committee is the ombudsperson and direct access has been provided to the employees to contact him through e-mail, post and telephone for reporting any matter.

Related Party Transactions

The Company has a policy on related party transactions which is available on the Company's website at https://marutistoragenew. blob.core.windows.net/msilintiwebpdf/Policy on Related Party Transactions.pdf In terms of Section 134(3) (h) of the Act read with Rule 15 of the Companies (Meetings of Board and its Powers) Rules, 2014, there was no transaction to be reported in Form AOC 2. The disclosure with respect to the transactions with promoter and promoter group which is holding 10% or more of the shareholding in the Company are given in the notes forming part of the financial statements.

Performance Evaluation

Pursuant to the provisions of the Companies Act, 2013 and the Listing Regulations, the annual performance evaluation of the Board, its committees and the Directors was carried out as per the Nomination and Remuneration Policy of the Company. The evaluation of the performance of the Board, its Chairman and the Non-independent Directors was carried out by the Independent Directors. The evaluation of the performance of the Directors individually was done by the Nomination and Remuneration Committee and the evaluation of the performance of the Board, its committees and the individual Directors was done by the Board. The criteria for the evaluation of individual Directors included a) the extent of engagement and contribution to the affairs of the Company including by way of attendance in board and committee meetings; b) ability to discharge their duties and obligations diligently in the best interest of the Company; c) ability to provide effective leadership and checks and balances towards sustaining the highest levels of corporate governance; d) exercise duty of care and skill in the discharge of their functions; e) exercise independence of judgment and bring about objectivity to the board process; and f) safeguarding the interest of all the stakeholders specially the minority shareholders. The evaluation criteria of the performance of the Board and its committees included, inter-alia, their composition, attendance of Directors, participation levels, bringing specialised knowledge for decision making, smooth functioning of the Board/committees and effective decision making. The Directors expressed their satisfaction with the evaluation process. The Board also noted that the Independent Directors had fulfilled the independence criteria as specified in the Listing Regulations and were independent from the management.

Nomination and Remuneration Policy

The Nomination and Remuneration Policy is attached as Annexure B.

Corporate Social Responsibility (CSR)

The annual report on CSR activities containing details of CSR Policy, composition of the CSR Committee and other prescribed details are given in Annexure C.

Disclosure under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013

The Company has in place an Anti- Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and has also complied with its provisions relating to the constitution of Internal Complaints Committee to redress complaints received regarding sexual harassment.

The status of the complaints received by the Company during the year is as under:

Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo

Information in accordance with Section 134(3) (m) of the Act read with Rule 8 of the Companies (Accounts) Rules, 2014 is attached as Annexure D.

Corporate Governance

The Company has complied with the corporate governance requirements, as stipulated under the Listing Regulations. A certificate of compliance by auditors shall form part of the annual report.

Secretarial Audit Report

In accordance with the provisions of Section 204 of the Act read with The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board appointed M/s RMG & Associates, a firm of Company Secretaries in practice to undertake the Secretarial Audit for 2019-20. The report on secretarial audit is attached as Annexure E. The report does not contain any qualification.

Secretarial Standards

The Company has complied with the Secretarial Standards issued by the Institute of Company Secretaries of India.

Management Discussion and Analysis Report

The annual report has a detailed report on Management Discussion and Analysis.

Personnel

As required by the provisions of Section 197 of the Act read with Rule 5 of The Companies (Appointment and Remuneration

of Managerial Personnel) Rules, 2014, the particulars of the employees are set out in Annexure F. However, as per the provisions of Section 136 of the Act, the annual report is being sent to all the members of the Company excluding the aforesaid information. The said information is available for inspection by the members at the registered office of the Company up to the date of the ensuing Annual General Meeting. Any member interested in obtaining such particulars may write to the Company Secretary at the registered office of the Company.

Cost Auditors and Records

In accordance with the provisions of Section 148 of the Act read with Companies (Cost Records and Audit) Rules, 2014, M/s R. J. Goel & Co., Cost Accountants, New Delhi (Registration No. 000026) were appointed as the Cost Auditors of the Company to carry out the cost audit for 2020-21. The maintenance of cost records as specified by the Central Government under Section 148 (1) of the Act is required by the Company and such accounts and records are made and maintained.

Auditors

The auditors, M/s Deloitte Haskins & Sells LLP were appointed in the 35th Annual General Meeting and hold their office till the conclusion of the 40th Annual General Meeting. A certificate has been obtained from Deloitte Haskins & Sells to the effect that the Company is in compliance with the conditions of Foreign Direct Investment for the downstream investment made by the Company.

CRISIL Ratings

The Company was awarded the highest financial credit rating of AAA/stable (long term) and A1+ (short term) on its bank facilities by CRISIL. The rating underscores the financial strength of the Company in terms of the highest safety with regard to timely fulfillment of its financial obligations.

Quality

The Company has established and is maintaining an environment management system. During the year, surveillance audit for ISO-14001 was carried out by M/s AVI, Belgium for the manufacturing plants located at Gurugram, Manesar and R&D Centre in Rohtak. The auditors recommended continuance of ISO-14001 for all manufacturing facilities.

The quality management system of the Company is certified as per ISO 9001:2015 standard. Regular assessments of the quality systems are done through surveillance audits and re-certification assessments are done at every three years by an accredited third party agency. The Company has an internal assessment mechanism to verify and ensure adherence to defined quality systems across the Company.

Awards/Recognition/Rankings

The Company received many awards/recognitions/rankings during the year. Some of these are mentioned hereunder:

a) ‘National safety award' by Ministry of Labour and Employment, Government of India and ‘Platinum safety award' by FICCI.

b) ‘Marketer of the year' for the 3rd time in a row by Marquee Award 2019.

c) ‘The enterprise of the year-2019.'

d) ‘Exceed platinum award'.

e) Swift won ‘Motoring world car of the year' and ‘Hatchback of the year' at Motoring Awards.

f) Ertiga won ‘MUV of the year' at Motoring Awards.

g) Mini SUV S-Presso won the following awards:

i) ‘Hatchback of the year 2019' by ‘News 18 Tech and Auto Awards 2019'.

ii) 'Budget Car of the year' by ‘Autocar Awards 2020'.

iii) ‘Entry level hatchback of the year' at Car India Awards 2020.

Acknowledgment

The Board of Directors would like to express its sincere thanks for the co-operation and advice received from the Government of India, the State Governments of Haryana and Gujarat. Your Directors also take this opportunity to place on record their gratitude for timely and valuable assistance and support received from Suzuki Motor Corporation, Japan. The Board also places on record its appreciation for the enthusiastic co-operation, hard work and dedication of all the employees of the Company including the Japanese staff, dealers, vendors, customers, business associates, auto finance companies, state government authorities and all concerned without which it would not have been possible to achieve all round progress and growth of the Company. The Directors are thankful to the members for their continued patronage.

For and on behalf of the Board of Directors