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You can view full text of the latest Director's Report for the company.

BSE: 532500ISIN: INE585B01010INDUSTRY: Auto - Cars & Jeeps

BSE   ` 7181.95   Open: 7348.00   Today's Range 7129.40
-101.10 ( -1.41 %) Prev Close: 7283.05 52 Week Range 6650.00
Year End :2017-03 

The Directors have pleasure in presenting the 36th annual report together with the audited financial statements for the year ended 31st March, 2017.

Financial Results

The Company’s financial performance during the year 2016-17 as compared to the previous year 2015-16 is summarized below:

(Rs. in million)



Total revenue



Profit before tax



Tax expense



Profit after tax



Retained Earnings

Balance at the beginning of the year



Profit for the year



Other comprehensive income arising from remeasurement of defined benefit obligation*



Amount transferred to general reserves



Payment of dividend on equity shares



Corporate dividend tax paid



Balance at the end of the year



*net of income tax of Rs.58 million (previous year Rs.38 million)

Financial Highlights

The total revenue (net of excise) was Rs.703,146 million as against Rs.589,991 million in the previous year showing an increase of 19 percent. Sale of vehicles in the domestic market was 1,444,541 units as compared to 1,305,351 units in the previous year showing an increase of 11 percent. Total number of vehicles exported was 124,062 units as compared to 123,897 units in the previous year showing an increase of 0.1 percent.

Profit before tax (PBT) was Rs.99,413 million against Rs.74,437 million showing an increase of 34 percent and profit after tax (PAT) stood at Rs.73,377 million against Rs.53,643 million in the previous year showing an increase of 37 percent.


The board recommends a dividend of Rs.75 per equity share of Rs.5 each for the year ended 31st March, 2017 amounting to Rs.27,268 million including dividend distribution tax of Rs.4,612 million. The Company has formulated a dividend distribution policy which forms part of the annual report.

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)

Extract of Annual Return

The details forming part of the extract of the Annual Return in Form MGT-9 is attached as Annexure - A.

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 the website of the Company at

Particulars of Loans, Guarantees and Investments

Details of loans, guarantees and investments 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 from all the independent directors. The details of the familiarisation programmes for the independent directors are available on the website of the Company at familiarization-programmes.aspx.

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. Toshiaki Hasuike ceased to be a Whole-time director with effect from close of business hours of 19th November, 2016. He continues as a non-executive director of the Company.

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 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 a concern about serious irregularities, unethical behaviour, 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 http://www.marutisuzuki. com/policy-on-related-party-transactions.aspx. 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 are no transactions to be reported in Form AOC - 2.

Performance Evaluation

Pursuant to the provisions of the Act and the Listing Regulations, the board has carried out the annual performance evaluation of its own performance, the Directors individually as well as the evaluation of its committees. The evaluation criteria, inter-alia, covered various aspects of the board’s functioning including its composition, attendance of Directors, participation levels, bringing specialized knowledge for decision making, smooth functioning of the board and effective decision making. The board and its committees had been highly effective in achieving their respective charters and their meetings were well run and the members acted with sufficient diligence and care.

The performance of individual directors was evaluated on parameters such as level of engagement and contribution to the affairs of the Company including by way of attendance in board/committee meetings, level of independence of judgement, care undertaken in safeguarding the interest of the Company and its minority shareholders. All the directors were diligent, meticulous and faithful in the performance of their duties and the Directors expressed their satisfaction with the evaluation process.

The criteria laid down by the Nomination and Remuneration Committee for evaluation of performance of independent directors included, inter-alia, the extent of engagement including attendance at the board/ committee meetings, ability to discharge their duties and provide effective leadership, exercise independence of judgement and safeguarding the interest of all the stakeholders including the minority shareholders.

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. The Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment. During the period under review, two complaints were received by the ICC out of which one complaint was investigated and closed. The second complaint was received in March, 2017 and is under investigation.

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 various regulations of 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 2016-17. The report on secretarial audit is attached as Annexure - E. The report does not contain any qualification.


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

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 2017-18.


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. As per the provisions of Section 139 of the Act, their appointment shall be placed in the forthcoming Annual General Meeting for ratification.

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.


The Company was awarded ISO/IEC 27001:2005 certification by STQC Directorate (Standardization, Testing and Quality Certificate), Ministry of Communications and Information Technology, Government of India after re-assessment. In 2015, the certification has been upgraded to 27001: 2013.

The Company has established and is maintaining an environment management system. During the year, surveillance audit under IS0-14001 was carried out by M/s AVI, Belgium for the manufacturing plants located at Gurugram and Manesar.

The auditors recommended continuance of IS0-14001 of all manufacturing facilities.

The quality management system of the Company is certified after the ISO 9001:2015 standard. Re-assessment of the quality systems is done at regular intervals 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.


Mr. R. C. Bhargava was conferred with prestigious Hall of Fame Award at CNBC TV18’s India Business Leadership Awards. Outlook India Magazine honoured Mr. R. C. Bhargava as one of the 50 greatest CEOs ever. He was featured in the ‘Brilliant’ Category.

Mr. Kenichi Ayukawa was awarded with the best CEO-Multinational Company at the prestigious Forbes India Leadership Awards 2016. He was conferred with Automotive Man of the Year by NDW Car and Bike Awards and also shortlisted best CEO (Large Companies) by Business Today.

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

- Golden Peacock Training Award 2016.

- Dun & Bradstreet Corporate awards in the automobiles category.

- Golden Peacock Award for Occupational Health and Safety 2016 in the automobile category.

- J.D. Power Customer Satisfaction Index for the 17th time.

- ’Handa Golden Key Trophy’ as first prize by Indian Value Engineering Society (INVEST) for excellence in demonstrating value engineering as an organized corporate activity for the financial year 2015-16.

- ’Corporate Excellence-Commendation of Significant Achievement’ Certificate at the prestigious CII-ITC Sustainability Award 2016 for its CSR initiatives.

- ’Vitara Brezza’ got following three awards at the 17th CNBC TV18 overdrive awards:

- Overdrive Car of the year

- Compact SUV of the year

- Viewers’ Choice Car of the year

- Baleno’s next-generation lightweight platform received award for Safety Technology of the year by Indian Automotive Technology and Innovative Awards (IATIA).

- Vitara Brezza bagged ICOTY (Indian Car of the Year) 2017 award.

- Vitara Brezza won three awards - Viewers’ Choice Car of the year 2017, Car of the year 2017 and Compact SUV/ Crossover of the year by Autocar India Awards.

- Vitara Brezza won three prestigious awards at the BTVi’s ‘The Auto Show - Car India & Bike India Awards 2017’.

- Vitara Brezza also received the Domestic Car of the Year award by T3 & Smart Photography - Innovation Technology & Imaging Awards 2017.

- The Company was chosen ‘Star MNC’ at Business Standard Annual Awards 2016.

- Gold Exceed Award 2017 recognizes excellence in Occupational Health and Safety in the automobile sector.

The Company was honoured for achieving high standards of safety, health and environment at workplace.

- Vitara Brezza was declared the ‘Car of the year’ & ’Compact SUV of the year’ at the 9th Times Auto Awards.

- BML Munjal Award 2016 in the category of private sector (manufacturing).


The board of directors would like to express its sincere thanks for the co-operation and advice received from the Government of India, Haryana Government and the Gujarat Government.

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

R.C. Bhargava Kenichi Ayukawa

Chairman Managing Director & CEO

New Delhi

27th April, 2017