Private & Confidential – For Private Circulation Only (This Information Memorandum is neither a Prospectus nor a statement in Lieu of Prospectus) Dated: April 15, 2020 Mahindra & Mahindra Limited (Incorporated as a limited company under the Indian Companies Act, 1913 on October 2, 1945) Corporate Identification Number: L65990MH1945PLC004558 Registered Office: Gateway Building, Apollo Bunder, Mumbai - 400 001 Head Office: Mahindra Towers, Dr. G.M. Bhosale Marg, P.K. Kurne Chowk, Worli, Mumbai – 400 018 Compliance Person: Mr. Narayan Shankar; Email of Compliance Person: [email protected]; Telephone: 022 24975074; Fax: 022 2490 0833; Website: www.mahindra.com PRIVATE & CONFIDENTIAL THIS INFORMATION MEMORANDUM DATED April 15, 2020 IS PREPARED IN CONFORMITY WITH THE SECURITIES AND EXCHANGE BOARD OF INDIA (ISSUE AND LISTING OF DEBT SECURITIES) REGULATIONS, 2008 ISSUED VIDE NOTIFICATION No. LAD-NRO/GN/2008/13/127878 DATED JUNE 06, 2008 AS AMENDED FROM TIME TO TIME. INFORMATION MEMORANDUM INFROMATION MEMORANDUM FOR ISSUE BY WAY OF PRIVATE PLACEMENT (“ISSUE”) OF 10,000 DEBENTURES (“DEBENTURES”) OF A FACE VALUE OF INR 10,00,000 (RUPEES TEN LAKH ONLY) AGGREGATING UPTO INR 1000,00,00,000 (RUPEES ONE THOUSAND CRORE) (“ISSUE SIZE”) (“ISSUE”) BY MAHINDRA & MAHINDRA LIMITED (THE “ISSUER”). THIS ISSUANCE WOULD BE UNDER THE ELECTRONIC BOOK MECHANISM FOR ISSUANCE OF DEBT SECURITIES ON A PRIVATE PLACEMENT BASIS AS PER THE SECURITIES AND EXCHANGE BOARD OF INDIA (“SEBI”) CIRCULAR SEBI/HO/DDHS/CIR/P/2018/05 DATED JANUARY 5, 2018 AND ANY AMENDMENTS THERETO (“SEBI EBP CIRCULAR”) READ WITH “UPDATED OPERATIONAL GUIDELINES FOR ISSUANCE OF SECURITIES ON PRIVATE PLACEMENT BASIS THROUGH THE ELECTRONIC BOOK MECHANISM” ISSUED BY BSE VIDE THEIR NOTICE NO.. 20180424-45 -DATED APRIL 24, 2018, AND ANY AMENDMENTS THERETO (“BSE EBP GUIDELINES”) TOGETHER WITH THE SEBI EBP CIRCULAR. (THE SEBI EBP CIRCULAR AND THE BSE EBP GUIDELINES ARE HEREINAFTER COLLECTIVELY REFERRED TO AS THE “OPERATIONAL GUIDELINES”). THE ISSUER INTENDS TO USE THE BSE - BOND EBP PLATFORM. THIS DISCLOSURE DOCUMENT IS BEING UPLOADED ON THE BSE BOND-EBP PLATFORM TO COMPLY WITH THE OPERATIONAL GUIDELINES AND AN OFFER WILL BE MADE BY ISSUE OF THE SIGNED PPOAL LETTER AFTER COMPLETION OF THE BIDDING PROCESS ON ISSUE/BID CLOSING DATE, TO SUCCESFUL BIDDER IN ACCORDANCE WITH THE PROVISIONS OF THE COMPANIES ACT, 2013 AND RELATED RULES. GENERAL RISKS Investments in debt and debt related securities involves a degree of risk and investors should not invest any funds in the debt instrument, unless they understand the terms and conditions of the Issue and can afford to take risks attached to such investments. For taking an investment decision, investors must rely on their own examination of the Issuer and the offer including the risks involved. Investors are advised to read the section on “Risk Factors” carefully before taking an investment decision on this offer. The Debentures have not been recommended or approved by the Securities and Exchange Board of India (“SEBI”) nor does SEBI guarantee the accuracy or adequacy of the contents of this Information Memorandum. Eligible Investors are advised to take an informed decision and consult their tax, legal, financial and other advisers, regarding the suitability of the Debentures in the light of their particular financial circumstances, investment objectives and risk profile. ISSUER’S ABSOLUTE RESPONSIBILITY The Issuer, having made all reasonable inquiries, accepts responsibility for, and confirms that this Information Memorandum contains all information with regard to the Issuer and the Issue, which is material in the context of the Issue, that the information contained in this Information Memorandum is true and correct in all material respects and is not misleading in any material respect, that the opinions and intentions expressed herein are honestly held and that there are no other facts, the omission of which makes this Information Memorandum as a whole or any of such information or the expression of any such opinions or intentions misleading in any material respect. CREDIT RATING The Debentures have been rated ‘[ICRA]AAA’ with ‘Stable’ outlook by ICRA Limited (“ICRA”) for an amount up to INR 1000,00,00,000 (Rupees One Thousand Crore) vide its letter dated April 9, 2020*. The above rating is not a recommendation to buy, sell or hold securities and investors should take their own decisions. The rating may be subject to revision or withdrawal at any time by the assigning rating agency and the rating should be evaluated independently of any other rating. The rating agency has the right to suspend, withdraw the rating at any time on the basis of new information etc. Please refer to Annexure A of this Information Memorandum for rationale for the above rating. LISTING The Debentures are proposed to be listed on the wholesale debt market (“WDM”) segment of the BSE Limited (“Stock Exchange”). The Issuer shall comply with the requirements of the SEBI LODR Regulations to the extent applicable to it on a continuous basis. The Stock Exchange has given its in-principal listing approval for the Debentures proposed to be offered through this Information Memorandum vide their letter dated April 13, 2020. Please refer to Annexure C to this Information Memorandum for the ‘in-principle’ listing approval from the Stock Exchange. DEBENTURE TRUSTEE REGISTRAR TO THE ISSUE ARRANGER TO THE ISSUE AXIS TRUSTEE SERIVES LIMITED Address: The Ruby, 2nd Floor SW, 29 Senapati Bapat Marg, Dadar West, Mumbai – 400028 Contact Person: Makarand Kulkarni Tel: +91 22 6230 0451 Fax: +91 22 6230 0700 Email: [email protected]; [email protected]. KFIN TECHNOLOGIES PRIVATE LIMITED Registered Office: Selenium Tower-B, Plot No. 31 & 32, Gachibowli, Financial District, Nanakramguda, Serilingampally, Hyderabad – 500032, Telangana Contact Person: Mr.S.V. Raju Tel: (91 40) 67161500/ 2222 Fax: (91 40) 23001153 AXIS BANK LIMITED Address: Axis House, 8th Floor, C-2, Wadia International Centre, P.B. Marg, Worli, Mumbai, 400 025 Contact Person: Mr. Abhishek Lahoti Tel: +91 22 4202 6695 Fax: +91-22-2425 2800 Email: [email protected]ISSUE PROGRAMME ISSUE / BID OPENING DATE ISSUE / BID CLOSING DATE PAY-IN DATE DEEMED DATE OF ALLOTMENT April 17, 2020 April 17, 2020 April 20, 2020 April 20, 2020 The Issuer reserves the right to change the issue programme including the Deemed Date of Allotment (as defined hereinafter) at its sole discretion in accordance with the timelines specified in the Operational Guidelines, without giving any reasons or prior notice. The Issue will be open for bidding as per bidding window that would be communicated through BSE BOND- EBP Platform. The issue of Debentures shall be subject to the provisions of the Companies Act, 1956, to the extent in force and applicable (the “1956 Act”), the Companies Act, 2013, as amended, (the “2013 Act” together with the 1956 Act, “Companies Act”), the rules notified thereunder, the Memorandum and Articles of Association of the Issuer, SEBI ILDS Regulations, SEBI LODR Regulations, the terms and conditions of this Information Memorandum filed with the Exchange(s), the Application Form, the Debenture Trust Deed and other documents in relation to such Issue. Capitalized terms used here have the meaning ascribed to them in this Information Memorandum. *The credit rating letter was confirmed, received and published on April 13, 2020 together with the credit rationale
115
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Private & Confidential – For Private Circulation Only
(This Information Memorandum is neither a Prospectus nor a statement in Lieu of Prospectus)
Dated: April 15, 2020
Mahindra & Mahindra Limited (Incorporated as a limited company under the Indian Companies Act, 1913 on October 2, 1945)
THIS INFORMATION MEMORANDUM DATED April 15, 2020 IS PREPARED IN CONFORMITY WITH THE SECURITIES AND EXCHANGE BOARD OF INDIA (ISSUE AND
LISTING OF DEBT SECURITIES) REGULATIONS, 2008 ISSUED VIDE NOTIFICATION No. LAD-NRO/GN/2008/13/127878 DATED JUNE 06, 2008 AS AMENDED FROM
TIME TO TIME.
INFORMATION MEMORANDUM
INFROMATION MEMORANDUM FOR ISSUE BY WAY OF PRIVATE PLACEMENT (“ISSUE”) OF 10,000 DEBENTURES (“DEBENTURES”) OF A FACE VALUE OF
INR 10,00,000 (RUPEES TEN LAKH ONLY) AGGREGATING UPTO INR 1000,00,00,000 (RUPEES ONE THOUSAND CRORE) (“ISSUE SIZE”) (“ISSUE”) BY
MAHINDRA & MAHINDRA LIMITED (THE “ISSUER”). THIS ISSUANCE WOULD BE UNDER THE ELECTRONIC BOOK MECHANISM FOR ISSUANCE OF DEBT
SECURITIES ON A PRIVATE PLACEMENT BASIS AS PER THE SECURITIES AND EXCHANGE BOARD OF INDIA (“SEBI”) CIRCULAR
SEBI/HO/DDHS/CIR/P/2018/05 DATED JANUARY 5, 2018 AND ANY AMENDMENTS THERETO (“SEBI EBP CIRCULAR”) READ WITH “UPDATED OPERATIONAL
GUIDELINES FOR ISSUANCE OF SECURITIES ON PRIVATE PLACEMENT BASIS THROUGH THE ELECTRONIC BOOK MECHANISM” ISSUED BY BSE VIDE
THEIR NOTICE NO.. 20180424-45 -DATED APRIL 24, 2018, AND ANY AMENDMENTS THERETO (“BSE EBP GUIDELINES”) TOGETHER WITH THE SEBI EBP
CIRCULAR. (THE SEBI EBP CIRCULAR AND THE BSE EBP GUIDELINES ARE HEREINAFTER COLLECTIVELY REFERRED TO AS THE “OPERATIONAL
GUIDELINES”). THE ISSUER INTENDS TO USE THE BSE - BOND EBP PLATFORM.
THIS DISCLOSURE DOCUMENT IS BEING UPLOADED ON THE BSE BOND-EBP PLATFORM TO COMPLY WITH THE OPERATIONAL GUIDELINES AND AN
OFFER WILL BE MADE BY ISSUE OF THE SIGNED PPOAL LETTER AFTER COMPLETION OF THE BIDDING PROCESS ON ISSUE/BID CLOSING DATE, TO
SUCCESFUL BIDDER IN ACCORDANCE WITH THE PROVISIONS OF THE COMPANIES ACT, 2013 AND RELATED RULES.
GENERAL RISKS
Investments in debt and debt related securities involves a degree of risk and investors should not invest any funds in the debt instrument, unless they understand the terms and conditions
of the Issue and can afford to take risks attached to such investments. For taking an investment decision, investors must rely on their own examination of the Issuer and the offer including
the risks involved. Investors are advised to read the section on “Risk Factors” carefully before taking an investment decision on this offer. The Debentures have not been recommended or
approved by the Securities and Exchange Board of India (“SEBI”) nor does SEBI guarantee the accuracy or adequacy of the contents of this Information Memorandum. Eligible Investors
are advised to take an informed decision and consult their tax, legal, financial and other advisers, regarding the suitabilit y of the Debentures in the light of their particular financial
circumstances, investment objectives and risk profile.
ISSUER’S ABSOLUTE RESPONSIBILITY
The Issuer, having made all reasonable inquiries, accepts responsibility for, and confirms that this Information Memorandum contains all information with regard to the Issuer and the
Issue, which is material in the context of the Issue, that the information contained in this Information Memorandum is true and correct in all material respects and is not misleading in any
material respect, that the opinions and intentions expressed herein are honestly held and that there are no other facts, the omission of which makes this Information Memorandum as a
whole or any of such information or the expression of any such opinions or intentions misleading in any material respect.
CREDIT RATING
The Debentures have been rated ‘[ICRA]AAA’ with ‘Stable’ outlook by ICRA Limited (“ICRA”) for an amount up to INR 1000,00,00,000 (Rupees One Thousand Crore) vide its letter
dated April 9, 2020*. The above rating is not a recommendation to buy, sell or hold securities and investors should take their own decisions. The rating may be subject to revision or
withdrawal at any time by the assigning rating agency and the rating should be evaluated independently of any other rating. The rating agency has the right to suspend, withdraw the rating
at any time on the basis of new information etc. Please refer to Annexure A of this Information Memorandum for rationale for the above rating.
LISTING
The Debentures are proposed to be listed on the wholesale debt market (“WDM”) segment of the BSE Limited (“Stock Exchange”). The Issuer shall comply with the requirements of the
SEBI LODR Regulations to the extent applicable to it on a continuous basis. The Stock Exchange has given its in-principal listing approval for the Debentures proposed to be offered
through this Information Memorandum vide their letter dated April 13, 2020. Please refer to Annexure C to this Information Memorandum for the ‘in-principle’ listing approval from the
Stock Exchange.
DEBENTURE TRUSTEE REGISTRAR TO THE ISSUE ARRANGER TO THE ISSUE
ISSUE / BID OPENING DATE ISSUE / BID CLOSING DATE PAY-IN DATE DEEMED DATE OF ALLOTMENT
April 17, 2020 April 17, 2020 April 20, 2020 April 20, 2020
The Issuer reserves the right to change the issue programme including the Deemed Date of Allotment (as defined hereinafter) at its sole discretion in accordance with the timelines specified
in the Operational Guidelines, without giving any reasons or prior notice. The Issue will be open for bidding as per bidding window that would be communicated through BSE BOND-
EBP Platform.
The issue of Debentures shall be subject to the provisions of the Companies Act, 1956, to the extent in force and applicable (the “1956 Act”), the Companies Act, 2013, as amended, (the
“2013 Act” together with the 1956 Act, “Companies Act”), the rules notified thereunder, the Memorandum and Articles of Association of the Issuer, SEBI ILDS Regulations, SEBI LODR
Regulations, the terms and conditions of this Information Memorandum filed with the Exchange(s), the Application Form, the De benture Trust Deed and other documents in relation to
such Issue. Capitalized terms used here have the meaning ascribed to them in this Information Memorandum.
*The credit rating letter was confirmed, received and published on April 13, 2020 together with the credit rationale
Private & Confidential – For Private Circulation Only
(This Information Memorandum is neither a Prospectus nor a statement in Lieu of Prospectus)
14. MATERIAL AGREEMENTS/ DOCUMENTS................................................................................ 79
15. DISCLOSURES PERTAINING TO WILFUL DEFAULT (IF ANY) ............................................. 80
ANNEXURE A - RATING LETTER AND RATING RATIONALE FROM ICRA .................................. 82
ANNEXURE B - CONSENT OF DEBENTURE TRUSTEE ...................................................................... 95
ANNEXURE C - IN-PRINCIPLE APPROVAL OF THE STOCK EXCHANGE ..................................... 96
ANNEXURE D - COPY OF BOARD RESOLUTION ................................................................................ 97
ANNEXURE E ........................................................................................................................................... 102
PART A: AUDITED STANDALONE FINANCIALS ............................................................................... 102
PART B: AUDITED CONSOLIDATED FINANCIAL STATEMENTS .................................................. 105
PART C: AUDITED CASH FLOW STATEMENTS ................................................................................ 109
Private & Confidential – For Private Circulation Only
(This Information Memorandum is neither a Prospectus nor a statement in Lieu of Prospectus)
Dated: April 15, 2020
1
1. DISCLAIMERS
1.1 Issuer's disclaimer
This Information Memorandum is neither a prospectus nor a statement in lieu of a prospectus
under the Companies Act. This Information Memorandum is prepared in conformity with the
SEBI ILDS Regulations and the Companies Act and the rules thereunder. The distribution of
this Information Memorandum and Issue of Debentures to be listed on the WDM segment of
BSE Limited is being made strictly on a private placement basis. This Information
Memorandum is not intended to be circulated to more than 200 persons in the aggregate in a
Financial Year and to any person other than an Eligible Investor. Multiple copies hereof given
to the same entity shall be deemed to be given to the same person and shall be treated as such.
This Information Memorandum does not constitute and shall not be deemed to constitute an
offer or an invitation to subscribe to the Debentures to the public in general. This Information
Memorandum is uploaded on the BSE-Bond-EBP Platform to comply with the SEBI EBP
Circular and offer will be made by issue of the signed PPOAL and completion of the bidding,
to successful bidders. This Information Memorandum discloses information pursuant to the
SEBI ILDS Regulations as amended from time to time and shall be uploaded on the BSE BOND
EBP Platform to facilitate invitation of bids. This Information Memorandum shall be available
on the wholesale debt market segment of the BSE Limited after the final listing of the
Debentures. Upon Issue/Bid Closing Date, the Issuer shall issue a signed PPOAL to the
successful bidders who shall be eligible to make an offer by submission of the completed
Application Form under the PPOAL. This Information Memorandum has been prepared solely
to provide general information about the Issuer to Eligible Investors to whom it is specifically
addressed and who are willing and eligible to subscribe to the Debentures. This Information
Memorandum does not purport to contain all the information that any Eligible Investor may
require. Further, this Information Memorandum has been prepared for informational purposes
relating to this transaction only and upon the express understanding that it will be used only for
the purposes set forth herein. Neither this Information Memorandum nor any other information
supplied in connection with the Debentures is intended to provide the basis of any credit or
other evaluation and any recipient of this Information Memorandum should not consider such
receipt a recommendation to purchase any Debentures. Each Eligible Investor contemplating
purchasing any Debentures should make its own independent investigation of the financial
condition and affairs of the Issuer, and its own appraisal of the creditworthiness of the Issuer as
well as the structure of the Issue. Potential Eligible Investors should consult their own financial,
legal, tax and other professional advisors as to the risks and investment considerations arising
from an investment in the Debentures and should possess the appropriate resources to analyze
such investment and the suitability of such investment to such Eligible Investor's particular
circumstances. It is the responsibility of potential Eligible Investors to also ensure that they will
sell these Debentures in strict accordance with this Information Memorandum and applicable
laws, so that the sale does not constitute an offer to the public, within the meaning of the
Companies Act. Neither the intermediaries nor their agents nor advisors associated with the
Issue undertake to review the financial condition or affairs of the Issuer during the life of the
arrangements contemplated by this Information Memorandum or have any responsibility to
advise any Eligible Investor or potential Eligible Investor in the Debentures of any information
coming to the attention of any other intermediary. By subscribing to the Issue, Eligible Investor
shall be deemed to have acknowledged that the Issuer does not owe them a duty of care in this
respect. Accordingly, none of the Issuer’s officers (including Principal Officer and/or its
Private & Confidential – For Private Circulation Only
(This Information Memorandum is neither a Prospectus nor a statement in Lieu of Prospectus)
Dated: April 15, 2020
2
directors) or employees shall be held responsible for any direct or consequential losses suffered
or incurred by any recipient of this Information Memorandum as a result of or arising from
anything expressly or implicitly contained in or referred to in this Information Memorandum
or any information received by the recipient in connection with this Issue. The Issuer confirms
that, as of the date hereof, this Information Memorandum (including the documents
incorporated by reference herein, if any) contains all information that is material in the context
of the Issue, is accurate in all material respects and does not contain any untrue statement of a
material fact or omit to state any material fact necessary to make the statements herein, in light
of the circumstances under which they are made, and is not misleading. No person has been
authorized to give any information or to make any representation not contained or incorporated
by reference in this Information Memorandum or in any material made available by the Issuer
to any potential Eligible Investor pursuant hereto and, if given or made, such information or
representation must not be relied upon as having been authorized by the Issuer. The Issuer
certifies that the disclosures made in this Information Memorandum are adequate and in
conformity with the SEBI ILDS Regulations. Further, the Issuer accepts no responsibility for
statements made otherwise than in the Information Memorandum or any other material issued
by or at the instance of the Issuer and anyone placing reliance on any source of information
other than this Information Memorandum for investment in the Issue would be doing so at his
own risk. No person has been authorized to give any information or to make any representation
not contained or incorporated by reference in this Information Memorandum or in any material
made available by the Issuer to any potential Eligible Investor pursuant hereto and, if given or
made, such information or representation must not be relied upon as having been authorized by
the Issuer. The legal advisors to the Issuer and any other intermediaries and their agents or
advisors associated with the Issue of Debentures have not separately verified the information
contained herein. Accordingly, no representation, warranty or undertaking, express or implied,
is made and no responsibility is accepted by the legal advisor to the Eligible Investor or any
such intermediary as to the accuracy or completeness of the information contained in this
Information Memorandum or any other information provided by the Issuer. Accordingly, the
legal advisors to the Issuer and other intermediaries associated with the Issue shall have no
liability in relation to the information contained in this Information Memorandum or any other
information provided by the Issuer in connection with the Issue. The Issuer does not undertake
to update the Information Memorandum to reflect subsequent events after the date of the
Information Memorandum and thus it should not be relied upon with respect to such subsequent
events without first confirming its accuracy with the Issuer. Neither the delivery of this
Information Memorandum nor any Issue made hereunder shall, under any circumstances,
constitute a representation or create any implication that there has been no change in the affairs
of the Issuer since the date hereof.
This Information Memorandum should not be construed to be a prospectus or a statement in
lieu of prospectus under the Companies Act. Apart from this Information Memorandum, no
offer document or prospectus has been or will be prepared in connection with the offering of
the Debentures or in relation to the Issuer nor is such a prospectus required to be registered
under applicable laws. This document does not and shall not be deemed to constitute an offer
or an invitation to the public generally to subscribe for or otherwise acquire the Debentures to
be issued by the Issuer. This document is for the exclusive use of the investors to whom it has
been specifically addressed and it should not be circulated or distributed to third party(s).
This Information Memorandum and the contents hereof are restricted providing
Private & Confidential – For Private Circulation Only
(This Information Memorandum is neither a Prospectus nor a statement in Lieu of Prospectus)
Dated: April 15, 2020
3
information under the SEBI ILDS Regulations for the purpose of inviting bids on the BSE
BOND-EBP Platform only for the Eligible Investors. An offer of private placement shall
be made by the Issuer by way of issue of the signed PPOAL to the successful bidders who
have been addressed through a communication by the Issuer, and only such recipients are
eligible to comply with the relevant regulations/guidelines applicable to them, including
but not limited to Operational Guidelines for investing in this issue. The contents of this
Information Memorandum and any other information supplied in connection with this
Information Memorandum or the Debentures are intended to be used only by those
Eligible Investors to whom it is distributed. It is not intended for distribution to any other
person and should not be reproduced or disseminated by the recipient.
The Issue of the Debentures will be under the electronic book mechanism as required in terms
of the Operational Guidelines.
No invitation is being made to any persons other than the Eligible Investors to whom Application Forms along with this Information Memorandum have been sent. Any application
by a person to whom the Information Memorandum has not been sent by the Issuer shall be
rejected without assigning any reason.
Invitations, offers, and allotment of the Debentures shall only be made pursuant to this Information Memorandum. You may not be and are not authorized to (1) deliver this
Information Memorandum or any other information supplied in connection with this
Information Memorandum or the Debentures to any other person; or (2) reproduce in part or full, this Information Memorandum or any other information supplied in connection with this
Information Memorandum or the Debentures in any manner whatsoever. Any distribution or
reproduction of this Information Memorandum in whole or in part or any public announcement or any announcement to third parties regarding the contents of this Information Memorandum
or any other information supplied in connection with this Information Memorandum or the
Debentures is unauthorized. Failure to comply with this instruction may result in a violation of
the Companies Act, the SEBI ILDS Regulations or other applicable laws of India and other jurisdictions. This Information Memorandum has been prepared by the Issuer for providing
information in connection with the proposed Issue described in this Information Memorandum.
Any person who is in receipt of this Information Memorandum, including the Eligible Investors, shall not reproduce, transmit, sell, publish or distribute in whole or part or make any
announcement in public or to a third party regarding the contents without the consent of the
Arranger and the Issuer. The recipient agrees to keep confidential all of such information provided (or made available hereafter), including, without limitation, the existence and terms
of such transaction, any specific pricing information related to the transaction or the amount or
terms of any fees payable to the Issuer or other parties in connection with such transaction. This
Information Memorandum may not be photocopied, reproduced, or distributed to others at any time without the prior written consent of the Issuer. Upon request, the recipient will promptly
return all material received from the Issuer (including this Information Memorandum) without
retaining any copies thereof, all in accordance with such confidentiality agreement. If any recipient of this Information Memorandum decides not to participate in the Issue, the recipient
must promptly return this Information Memorandum and all reproductions whether in whole or
in part and any other information statement, notice, opinion, memorandum, expression or
forecast made or supplied at any time in relation thereto or received in connection with the issue to the Issuer.
Neither the delivery of this Information Memorandum nor any sale of Debentures made
hereunder shall, under any circumstances, constitute a representation or create any implication
Private & Confidential – For Private Circulation Only
(This Information Memorandum is neither a Prospectus nor a statement in Lieu of Prospectus)
Dated: April 15, 2020
4
that there has been no change in the affairs of the Issuer since the date hereof. The Issuer does
not undertake to update the Information Memorandum to reflect subsequent events after the date of the Information Memorandum and thus no reliance should be placed on such subsequent
events without first confirming its accuracy with the Issuer. This Information Memorandum
may not be all inclusive and may not contain all of the information that the recipient may consider material.
This Information Memorandum does not constitute, nor may it be used for or in connection
with, an offer or solicitation by anyone in any jurisdiction in which such offer or solicitation is
not authorized or to any person to whom it is unlawful to make such an offer or solicitation. No action is being taken to permit an offering of the Debentures or the distribution of this
Information Memorandum in any jurisdiction where such action is not permitted. Persons into
whose possession this Information Memorandum comes are required to inform themselves about and to observe any such restrictions. The Information Memorandum is made available to
the Eligible Investors in the Issue on the strict understanding that it is confidential.
1.2 Disclaimer in respect of jurisdiction
This Issue is made in India to investors as specified under “Who Can Bid/Apply/Invest” in the
section “Issue Procedure” of this Information Memorandum, who shall be specifically
approached by the Issuer. This Information Memorandum does not constitute an offer to sell or
an invitation to subscribe to Debentures offered hereby to any person other than the Eligible Investors. Any disputes arising out of this Issue will be subject to the non-exclusive jurisdiction
of the courts and tribunals of Mumbai, India. This Information Memorandum does not
constitute an offer to sell or an invitation to subscribe to the Debentures herein, in any other jurisdiction to any person to whom it is unlawful to make an offer or invitation in such
jurisdiction.
1.3 Disclaimer in respect of the exchange
As required under the SEBI ILDS Regulations, a copy of this Information Memorandum has been filed with the Stock Exchange. It is to be distinctly understood that submission of this
Information Memorandum to the Stock Exchange should not in any way be deemed or
construed to mean that this Information Memorandum has been reviewed, cleared or approved by the Stock Exchange nor does the Stock Exchange in any manner warrant, certify or endorse
the correctness or completeness of any of the contents of this Information Memorandum, nor
does the Stock Exchange warrant that the Issuer’s Debentures will be listed or will continue to be listed on the Stock Exchange nor does the Stock Exchange take any responsibility for the
soundness of the financial and other conditions of the Issuer, its promoters, its management or
any scheme or project of the Issuer. Every person who desires to apply for or otherwise acquire
any securities of this Issuer may do so pursuant to independent inquiry, investigation and analysis and shall not have any claim against the Stock Exchange whatsoever by reason of any
loss which may be suffered by such person consequent to or in connection with such
subscription/ acquisition whether by reason of anything stated or omitted to be stated herein or any other reason whatsoever.
1.4 Disclaimer in respect of the Securities & Exchange Board of India
As per the provisions of the SEBI ILDS Regulations, a copy of this Information Memorandum has not been filed with or submitted to the SEBI. It is to be distinctly understood that this
Information Memorandum should not in any way be deemed or construed to have been
approved or vetted by SEBI. SEBI does not take any responsibility either for the financial
Private & Confidential – For Private Circulation Only
(This Information Memorandum is neither a Prospectus nor a statement in Lieu of Prospectus)
Dated: April 15, 2020
5
soundness of any proposal for which the Debentures issued hereof is proposed to be made or
for the correctness of the statements made or opinions expressed in this Information Memorandum. The issue of Debentures being made on a private placement basis, filing of this
document is not required with SEBI, however SEBI reserves the right to take up at any point
of time, with the Issuer, any irregularities or lapses in this Information Memorandum.
1.5 Disclaimer in respect of the credit rating agency
The ratings by the Credit Rating Agency should not be treated as a recommendation to buy, sell
or hold the rated Debentures. The Credit Rating Agency ratings are subject to a process of
surveillance which may lead to a revision in ratings. Please visit Credit Rating Agency’s website www.icra.in or contact the Credit Rating Agency’s office for the latest information on
Credit Rating Agencies’ ratings. All information contained herein has been obtained by the
Credit Rating Agency from sources believed by it to be accurate and reliable. Although reasonable care has been taken to ensure that the information herein is true, such information
is provided ‘as is’ without any warranty of any kind, and the Credit Rating Agency in particular,
makes no representation or warranty, express or implied, as to the accuracy, timeliness or completeness of any such information. All information contained herein must be construed
solely as statements of opinion and the Credit Rating Agency shall not be liable for any losses
incurred by users from any use of this publication or its contents. Most entities whose bank
facilities / instruments are rated by the Credit Rating Agency have paid a credit rating fee, based on the amount and type of bank facilities / instruments.
In case of partnership/proprietary concerns, the rating / outlook assigned by the Credit Rating
Agency is based on the capital deployed by the partners / proprietor and the financial strength of the firm at present. The rating / outlook may undergo change in case of withdrawal of capital
or the unsecured loans brought in by the partners / proprietor in addition to the financial
performance and other relevant factors. Please refer to Annexure A of this Information
Memorandum for the credit rating rationale and further details.
1.6 Disclaimer in respect of the Reserve Bank of India
The Debentures have not been recommended or approved by the RBI nor does RBI guarantee
the accuracy or adequacy of this document. It is to be distinctly understood that this document should not, in any way, be deemed or construed that the Debentures have been recommended
for investment by the RBI. RBI does not take any responsibility either for the financial
soundness of the Issuer, or the Debentures being issued by the Issuer or for the correctness of the statements made or opinions expressed in this document. Potential investors may make
investment decision in the Debentures offered in terms of this Information Memorandum solely
on the basis of their own analysis and RBI does not accept any responsibility about
servicing/repayment of such investment.
RBI does not accept any responsibility or guarantee about the present position as to the financial
soundness of the Issuer or for the correctness of any of the statements or representations made
or opinions expressed by the Issuer and for discharge of liability by the Issuer.
Neither is there any provision in law to keep, nor does the Issuer keep any part of the deposits
with the RBI and by issuing the certificate of registration to the Issuer, the RBI neither accepts
any responsibility nor guarantee for the payment of the deposit amount to any depositor.
1.7 Disclaimer in respect of the arranger
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(This Information Memorandum is neither a Prospectus nor a statement in Lieu of Prospectus)
Dated: April 15, 2020
6
The role of the Arranger in the assignment is confined to marketing and placement of the
Debentures on the basis of this Information Memorandum as prepared by the Issuer. The Arranger has neither scrutinized nor vetted nor reviewed nor has it done any due diligence for
verification of the contents of this Information Memorandum. The Arranger shall use this
Information Memorandum for the purpose of soliciting subscription(s) from Eligible Investors in the Debentures to be issued by the Issuer on a private placement basis. It is to be distinctly
understood that the aforesaid use of this Information Memorandum by the Arranger should not
in any way be deemed or construed to mean that the Information Memorandum has been
prepared, cleared, approved, reviewed or vetted by the Arranger; nor should the contents to this Information Memorandum in any manner be deemed to have been warranted, certified or
endorsed by the Arranger so as to the correctness or completeness thereof.
The Issuer has prepared this Information Memorandum and the Issuer is solely responsible and liable for its contents. The Issuer will comply with all laws, rules and regulations and has
obtained all regulatory, governmental, corporate and other necessary approvals for the issuance
of the Debentures. The Issuer confirms that all the information contained in this Information Memorandum has been provided by the Issuer or is from publicly available information, and
such information has not been independently verified by the Arranger. No representation or
warranty, expressed or implied, is or will be made, and no responsibility or liability is or will
be accepted, by the Arranger or their affiliates for the accuracy, completeness, reliability, correctness or fairness of this Information Memorandum or any of the information or opinions
contained therein, and the Arranger hereby expressly disclaims any responsibility or liability to
the fullest extent for the contents of this Information memorandum, whether arising in tort or contract or otherwise, relating to or resulting from this Information Memorandum or any
information or errors contained therein or any omissions there from. Neither Arranger and its
affiliates, nor its directors, employees, agents or representatives shall be liable for any damages
whether direct or indirect, incidental, special or consequential including lost revenue or lost profits that may arise from or in connection with the use of this document. By accepting this
Information Memorandum, the Eligible Investor accepts terms of this Disclaimer Clause of
Arranger, which forms an integral part of this Information Memorandum and agrees that the Arranger will not have any such liability.
Each person receiving this Information Memorandum acknowledges that such person has not
relied on the Arranger and/or its affiliates that may be associated with the Debentures in connection with its investigation of the accuracy of such information or its investment decision.
Issuer hereby declares that the Issuer has exercised due-diligence to ensure complete
compliance of applicable disclosure norms in this Information Memorandum. The Arranger:
(a) is not acting as trustee or fiduciary for the investors or any other person; and (b) is under no obligation to conduct any "know your customer" or other procedures in relation to any person.
The Arranger is not responsible for: (a) the adequacy, accuracy and/or completeness of any
information (whether oral or written) supplied by the Issuer or any other person in or in connection with this Information Memorandum; or (b) the legality, validity, effectiveness,
adequacy or enforceability of this Information Memorandum or any other agreement,
arrangement or document entered into, made or executed in anticipation of or in connection with this Information Memorandum; or (c) any determination as to whether any information
provided or to be provided to any investor is non-public information the use of which may be
regulated or prohibited by applicable law or regulation relating to insider dealing or otherwise.
The Arranger or any of their directors, employees, affiliates or representatives do not accept any responsibility and/or liability for any loss or damage arising of whatever nature and extent
in connection with the use of any of the information contained in this document. By accepting
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Dated: April 15, 2020
7
this Information Memorandum, investor(s) agree(s) that the Arranger will not have any such
liability.
1.8 Please note that:
1.8.1 The Arranger and/or their affiliates may, now and/or in the future, have other
investment and commercial banking, trust and other relationships with the Issuer and with other persons ("Other Persons");
1.8.2 As a result of those other relationships, the Arranger and/or their affiliates may get
information about Other Persons, the Issuer and/or the Issue or that may be relevant to
any of them. Despite this, the Arranger and/or their affiliates will not be required to disclose such information, or the fact that it is in possession of such information, to any
recipient of this Information Memorandum;
1.8.3 The Arranger and/or their affiliates may, now and in the future, have fiduciary or other relationships under which it, or they, may exercise voting power over securities of
various persons. Those securities may, from time to time, include securities of the
Issuer; and
1.8.4 The Arranger and/or their affiliates may exercise such voting powers, and otherwise
perform its functions in connection with such fiduciary or other relationships, without
regard to its relationship to the Issuer and/or the securities.
2. CONFIDENTIALITY
The information and data contained herein is submitted to each recipient of this Information
Memorandum on a strictly private and confidential basis. By accepting a copy of this
Information Memorandum or any other information supplied in connection with this Information Memorandum or the Debentures, each recipient agrees that neither it nor any of its
employees or advisors will use the information contained herein for any purpose other than
evaluating the Transaction described herein or will divulge to any other party any such
information. This Information Memorandum or any other information supplied in connection with this Information Memorandum or the Debentures must not be photocopied, reproduced,
extracted or distributed in full or in part to any person other than the recipient without the prior
written consent of the Issuer.
3. CAUTIONARY NOTE
The Eligible Investors have confirmed that they: (i) are knowledgeable and experienced in
financial and business matters, have expertise in assessing credit, market and all other relevant risk and are capable of evaluating, and have evaluated, independently the merits, risks and
suitability of purchasing the Debentures, (ii) understand that the Issuer has not provided, and
will not provide, any material or other information regarding the Debentures, except as included
in this Information Memorandum, (iii) have not requested the Issuer to provide it with any such material or other information, (iv) have not relied on any investigation that any person acting
on their behalf may have conducted with respect to the Debentures, (v) have made their own
investment decision regarding the Debentures based on their own knowledge (and information they have or which is publicly available) with respect to the Debentures or the Issuer, (vi) have
had access to such information as deemed necessary or appropriate in connection with purchase
of the Debentures, (vii) are not relying upon, and have not relied upon, any statement, representation or warranty made by any person, including, without limitation, the Issuer, and
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(viii) understand that, by purchase or holding of the Debentures, they are assuming and are
capable of bearing the risk of loss that may occur with respect to the Debentures, including the possibility that they may lose all or a substantial portion of their investment in the Debentures,
and they will not look to the Debenture Trustee appointed for the Debentures for all or part of
any such loss or losses that they may suffer.
The Eligible Investors should carefully read this Information Memorandum. This Information
Memorandum is for general information purposes only is not intended to provide the sole basis
of any credit decision or other evaluation and should not be considered as a recommendation
that any recipients of this Information Memorandum should invest in the Debentures proposed to be issued by the Issuer. Each Eligible Investor should make its own independent assessment
of the investment merit of the Debentures and the Issuer. Eligible Investors should consult their
own financial, legal, tax and other professional advisors as to the risks and investment considerations arising from an investment in the Debentures and should possess the appropriate
resources to analyze such investment and the suitability of such investment to such investor’s
particular circumstances. Recipients shall not be entitled to use any of the information otherwise than for deciding whether to invest in the Debentures. This Information Memorandum should
not be construed as an offer to sell or the solicitation of an offer to buy, purchase or subscribe
to any securities mentioned therein, and neither this document nor anything contained herein
shall form the basis of or be relied upon in connection with any contract or commitment whatsoever.
No person including any employee of the Issuer has been authorized to give any information or
to make any representation not contained in this Information Memorandum. Any information or representation not contained herein must not be relied upon as having been authorized by or
on behalf of the Issuer. Neither the delivery of this Information Memorandum at any time nor
any statement made in connection with the offering of the Debentures shall under the
circumstances imply that any information/representation contained herein is correct at any time subsequent to the date of this Information Memorandum. The distribution of this Information
Memorandum or the Application Forms and the offer, sale, pledge or disposal of the Debentures
may be restricted by law in certain jurisdictions. This Information Memorandum does not constitute an offer to sell or an invitation to subscribe to the Debentures in any jurisdiction to
any person to whom it is unlawful to make such offer or invitation in such jurisdiction. Persons
into whose possession this Information Memorandum comes are required by the Issuer to inform themselves about and observe any such restrictions. The sale or transfer of these
Debentures outside India may require regulatory approvals in India, including without
limitation, the approval of the RBI.
4. ISSUE OF DEBENTURES IN DEMATERIALISED FORM
The Debentures will be issued only in dematerialised form. The Issuer has made arrangements
with the Depositories for the issue of the Debentures in dematerialised form. Investors will have
to hold the Debentures in dematerialised form as per the provisions of Depositories Act. The Depository Participant's name, DP ID and beneficiary account number must be mentioned at
the appropriate place in the Application Form. The Issuer shall take necessary steps to credit
the Debentures allotted to the depository account of the investor. The Issuer shall ensure the Debentures are credited to the demat accounts of the Debenture Holders within 2 (two) working
days from the Deemed Date of Allotment.
5. CONSENTS
Axis Trustee Services Limited has given its written consent for its appointment (annexed hereto
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Dated: April 15, 2020
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as Annexure B) as Debenture Trustee to the Issue and inclusion of its name in the form and
context in which it appears in this Information Memorandum.
6. FORWARD-LOOKING STATEMENTS
6.1 Certain statements in this Information Memorandum are not historical facts but are “forward-
looking” in nature. Forward-looking statements appear throughout this Information Memorandum, including, without limitation, under the section titled “Risk Factors”. Forward-
looking statements may include statements concerning the Issuer’s plans, financial
performance, the Issuer’s competitive strengths and weaknesses, and the trends the Issuer
anticipates in the industry, along with the political and legal environment, and geographical locations, in which the Issuer operates, and other information that is not historical information.
6.2 The Issuer may have included statements in this Information Memorandum, that contain words
or phrases such as “will”, “would”, “aim”, “aimed”, “will likely result”, “is likely”, “are likely”, “believe”, “expect”, “expected to”, “will continue”, “will achieve”, “anticipate”, “estimate”,
“propose to”, “future”, “objective”, “goal”, “project”, “should”, “can”, “could”, “may”, “will pursue” and similar expressions or variations of such expressions, that may constitute “forward-
looking statements”. These forward-looking statements involve a number of risks, uncertainties
and other factors that could cause actual results, opportunities and growth potential to differ
materially from those suggested by the forward-looking statements. These risks and uncertainties include, but are not limited to:
6.2.1 General political, economic and business conditions in India and other countries
(including where the Issuer has a presence or has a trade relationship);
6.2.2 The impact of the outbreak of COVID-19 on the global and domestic operations of the
Issuer and liquidity and economic environment;
6.2.3 The Issuer’s ability to successfully implement its strategy, its growth and expansion
plans and technological changes;
6.2.4 The Issuer’s ability to manage the increased complexity of the risks faced by the Issuer;
6.2.5 Changes in the value of the Indian Rupee and changes in value of other currencies;
6.2.6 Changes in Indian or international interest rates, credit spreads and equity market prices;
6.2.7 Changes in laws and regulations that apply to the Issuer in India and in other countries
where the Issuer is carrying on business;
6.2.8 Changes in the foreign exchange control regulations in India and in other jurisdictions
where the Issuer is carrying on business.
6.2.9 Availability of adequate debt and equity financing at reasonable terms and managing
the operating expenses;
6.2.10 Performance of the Indian debt and equity markets; and
6.2.11 Competition from other automobile and farm equipment manufacturers.
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Dated: April 15, 2020
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The Issuer undertakes no obligation to update forward-looking statements to reflect events or
circumstances after the date thereof. Forward looking statements speak only as of the date of this Information Memorandum. None of the Issuer, its Directors, its officers or any of their
respective affiliates or associates has any obligation to update or otherwise revise any statement
reflecting circumstances arising after the date hereof or to reflect the occurrence of underlying events, even if the underlying assumptions do not come to fruition.
In addition, other factors that could cause actual results to differ materially from those estimated
by the forward-looking statements contained in this Information Memorandum include, but are
not limited to the general economic and political conditions in India and the other countries which have an impact on the Issuer's business activities or investments, political or financial
instability in India or any other country caused by any factor including any terrorist attacks in
India, or elsewhere or any other acts of terrorism world-wide, any anti-terrorist or other attacks, the monetary and interest rate policies of India, political or financial instability in India or any
other country including tensions with neighboring countries or military armament or social
unrest in any part of India, inflation, deflation, unanticipated turbulence in interest rates, changes in the value of the Indian Rupee, foreign exchange rates, equity prices or other rates or
prices, the performance of the financial markets and technological advancements in India and
globally, changes in domestic and foreign laws, regulations and taxes, changes in competition
and the pricing environment in India and regional or general changes in asset valuations. For a further discussion on the factors that could cause actual results to differ, see the discussion
under “Risk Factors” contained in this Information Memorandum.
7. LIMITS ON DISTRIBUTION
This Information Memorandum and any other information supplied in connection with this
Information Memorandum are not for distribution (directly or indirectly) in any jurisdiction
other than India unless the Issuer has intentionally delivered this Information Memorandum
and any other information supplied in connection with this Information Memorandum in such jurisdiction and even then only for the limited purpose intended by the Issuer. They are not an
offer for sale of Debentures, nor a solicitation to purchase or subscribe for Debentures, in any
jurisdiction where such offer, sale or solicitation would be unlawful. The Debentures have not been and will not be registered under the laws of any jurisdiction (other than India; to the extent
mandatory under applicable laws in India). The distribution of the Information Memorandum
in certain jurisdictions may be prohibited by law. Recipients are required to observe such restrictions and neither the Issuer nor its respective affiliates accept any liability to any person
in relation to the distribution of information in any jurisdiction.
8. PRESENTATION OF FINANCIAL INFORMATION
8.1 Financial data
In this Information Memorandum, unless otherwise specified, all financial information is of the
Issuer on a consolidated basis. With effect from April 1, 2016, companies in India having a
certain threshold net worth, including the Issuer, are required to prepare financial statements in accordance with the Indian Accounting Standards prescribed under Section 133 of the
Companies Act 2013, read with Rule 3 of the Companies (Indian Accounting Standards) Rules,
2015, as amended (“IND-AS”). Accordingly, the annual audited consolidated financial statements of the Issuer as at and for the years ended March 31, 2017, 2018 and 2019 and the
unaudited consolidated interim financial statements of the Issuer as at and for the half-year
ended September 30, 2019 and unaudited consolidated interim financial statements of the Issuer
as at and for the nine months ended December 31, 2019 have each been prepared in accordance
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Dated: April 15, 2020
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with IND-AS The annual audited consolidated financial statements of the Issuer as at and for
the years ended March 31, 2017, 2018 and 2019 are herein referred to as the “Consolidated Financial Statements”.
The annual audited standalone financial statements of the Company as at and for the years
ended March 31, 2017, 2018 and 2019 and the unaudited standalone interim financial statements of the Company as at and for the half-year ended September 30, 2019 and the
unaudited consolidated interim financial statements of the Company as at and for the nine
months ended December 31, 2019 have been prepared in accordance with IND-AS. The annual
audited standalone financial statements of the Company as at and for the years ended March 31, 2017, 2018 and 2019 are herein referred to as the “Standalone Financial Statements”.
In making an investment decision, investors must rely on their own examination of the Issuer,
the terms of the offering and the financial information contained in this Information
Memorandum. Information in the Consolidated Financial Statements and the Standalone
Financial Statements is, unless otherwise stated therein, stated in Indian Rupees in “crore” or
“lakh”. One crore is equal to 10 million Rupees and 10 lacs is equal to one million Rupees. The annual audited consolidated financial statements of the Issuer and the annual audited standalone
financial statements of the Company as at and for the year ended March 31, 2017 have been
audited by Messrs Deloitte Haskins & Sells, Chartered Accountants. The annual audited
consolidated financial statements of the Issuer and the annual audited standalone financial statements of the Company as at and for the year ended March 31, 2018 and March 31, 2019
have been audited by Messrs B S R & Co. LLP, Chartered Accountants. The unaudited
consolidated interim financial statements of the Issuer and the unaudited standalone interim financial statements of the Company as at and for the half-year ended September 30, 2019, have
each been reviewed by Messrs B S R & Co. LLP, Chartered Accountants.
8.2 Non-GAAP Financial Measures
As used in this Information Memorandum, a non-GAAP financial measure is one that purports to measure historical financial performance, financial position or cash flows, From time to time,
reference is made in this Information Memorandum to such “non-GAAP financial measures”,
including EBITDA, or (unless otherwise specified) profit before other income and finance costs, tax expense/benefit, depreciation, amortization and exceptional items and share of
profit/loss from joint ventures (net), and net debt, or (unless otherwise specified) non-current
borrowings plus current borrowings plus current maturities of long term borrowings plus current maturities of finance lease obligations, if any, minus cash and cash equivalents, bank
balances other than cash and cash equivalents and current investments. The Issuer’s
management believes that EBIT, EBITDA, EBITDA/revenue from operations, profit before
tax/revenue from operations, net debt, net worth, net debt to equity ratio, average net worth, return on average net worth, return on average capital employed and other non-GAAP financial
measures provide investors with additional information about the Issuer’s performance, as well
as ability to incur and service debt and fund capital expenditure, and are measures commonly used by investors.
8.3 Comparability of financials
The financial results have been prepared in accordance with the recognition and measurement principles under Ind AS as prescribed under Section 133 of the Companies Act, 2013 read with
the relevant rules issued thereunder and the other accounting principles generally accepted in
India.
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The Government of India introduced the Goods and Services Tax (GST) with effect from July
1, 2017. GST is collected on behalf of the Government and no economic benefit flows to the entity and hence Revenue from Operations under GST regime is presented excluding GST as
per Ind AS. However, Revenue from Operations under pre-GST regime included Excise Duty
which is now subsumed in GST. Consequently, the figures for the year ended March 31, 2019 are not comparable with the previous periods.
Effective April 1, 2018, Ind AS 115 -'Revenue from contracts with customers' has replaced Ind
AS 18 - 'Revenue' and Ind AS 11 - 'Construction contracts'. The Issuer has adopted modified
retrospective approach as per para C3(b) of Ind AS 115 to the contracts that were not completed as on April 1, 2018 and the cumulative effect of applying the standard is recognised at the date
of initial application i.e. April 1, 2018 as an adjustment to other equity in accordance with para
C7 of Ind AS 115. As permitted by the transition provision, the comparatives have not been restated. The application of Ind AS 115 did not have any material impact on the standalone
financial results of the Issuer.
The impact of application of Ind AS 115 on the consolidated financial results mainly arises from the 'Hospitality' and 'Real estate' segments. In the Hospitality segment, due to the
application of Ind AS 115, the membership fees and incremental costs to obtain and/or fulfill a
contract with a customer, as applicable, is recognised over the effective membership period.
The previous standard permitted the upfront recognition of the non refundable admission fees on sale of membership. In the Real estate segment, the changes are due to recognition of revenue
from contract with customers based on satisfaction of performance obligation at a point in time
as opposed to previously permitted percentage of completion method.
Previous period's figures have been regrouped/reclassified wherever necessary.
8.4 Rounding
Certain amounts and percentages included in this Information Memorandum have been
rounded. Accordingly, in certain instances, the sum of the numbers in a column may not equal the total figure for that column.
9. DEFINITIONS AND ABBREVIATIONS
In this Information Memorandum, unless the context otherwise requires, the terms defined and abbreviations expanded below shall have the same meaning as stated in this section. References
to statutes, rules, regulations, guidelines and policies will be deemed to include all amendments
and modifications notified thereto.
Further, unless otherwise indicated or the context otherwise requires, all references to “the
Company”, “our Company”, “Mahindra & Mahindra”, “Issuer”, “we”, “us” or “our” is to
Mahindra & Mahindra Limited and references to “you” are to the prospective Eligible Investors
debentures of a face value of Rs. 10,00,000 aggregating to Rs. 10,00,00,00,000
Debenture holders Persons who shall be holders of the Debentures and whose names
shall be into the Register of Debenture holders and shall include the
Beneficial Owners
Default Interest Additional interest at the rate of 2% p.a. on the Debentures in addition
to the payment of Interest and/or the Redemption Amount, as the case
may be payable by the Issuer in case of default in payment of any Interest on the Interest Payment Date and/or Redemption Amount on
the Redemption Date
Debenture
Trustee/Trustee
Trustee for the Debentureholders, in this case being Axis Trustee
Services Limited
Supplementary
Debenture Trustee
Agreement
Means the trust agreement to be entered into between the Debenture
Trustee and the Issuer in relation to the Issue
Debenture Trustee Regulations
Securities and Exchange Board of India (Debenture Trustee) Regulations, 1993, as amended
Deemed Date of
Allotment
April 20, 2020
Default Interest Rate Means an interest rate of 2% p.a.
Depository A depository registered with the SEBI under the Securities and
Exchange Board of India (Depositories and Participant) Regulations,
1996, as amended from time to time, in this case being NSDL and
CDSL
Eligible Investor Has the meaning set forth in “Summary of Key Terms” of this
Information Memorandum
Early Redemption
Date
The date on which the Debenture Trustee gives notice to the Issuer
upon the occurrence of Event of Default
Event of Default Events of default as set out in the “Summary of Key Terms” of this
Information Memorandum
Governmental
Authority
shall mean any:
a) government (central, state or otherwise) or sovereign state; b) any governmental agency, semi-governmental or judicial or
quasi-judicial or administrative entity, department or authority, or
any political subdivision thereof; c) including, without limitation, any stock exchange or any self-
regulatory organization, established under any applicable law
Information
Memorandum
This Information Memorandum dated April 15, 2020
Interest Payment Date Interest payable annually (and if such day is not a Business Day, the
day immediately next to such interest payment date that is a Business
Day) with the first interest payment date falling on April 20, 2021
Interest Period Each period from (and including) any Interest Payment Date/Deemed Date of Allotment to (but excluding) the next succeeding Interest
Payment Date
Interest Rate Interest at the fixed rate of 6.65% per annum payable on an annual
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Dated: April 15, 2020
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Term Description
basis on each Interest Payment Date
Investor(s) Such person who subscribe to this Issue
Issue Issue by way of private placement of Debentures by the Issuer
pursuant to the terms of this Information Memorandum
Record Date The date which is 15 Business Days prior to the Interest Payment Date
and the Redemption Date, as the case may be, for the purposes of actual payment or as may be prescribed by SEBI. Registered
Debenture holders on the Record Date will be the recipients of actual
payment of interest at the Interest Rate by the Issuer
Redemption Amount All principal amounts outstanding shall be payable on the
Redemption Date, as the case may be, in one bullet installment. On
the Redemption Date the accrued interest will also be payable.
Redemption Date The date falling 3 (three) years after the Deemed Date of Allotment, on which the outstanding principal of the Debentures will be repaid
by the Issuer
Register of Debenture
holders
The register maintained by the Issuer at its Registered Office as per
section 88 of the Companies Act, containing the names of the Debenture holders entitled to receive interest in respect of the
Debentures on the Record Date, and shall include the register of
Beneficial Owners maintained by the Depository under section 11 of the Depositories Act
Registered Debenture
holder
The Debenture holder whose name appears in the Register of
Debenture holders or in the beneficial ownership record furnished by
the Depository for this purpose
Registrar/Registrar to
the Issue
Registrar to this Issue, in this case being KFin Technologies Private
Limited
9.3 Conventional and General Terms, Abbreviations and References to Other Business
Entities
Abbreviation Full form
CDSL Central Depository Services (India) Limited
Depositories Act The Depositories Act, 1996, as amended from time to time
Depository Participant/ DP
A depository participant as defined under the Depositories Act
DP ID Depository Participant Identification Number
Financial Year/
Fiscal/ FY
Period of 12 months ended on March 31 of that particular year
Government / GoI Government of the Republic of India
GAAP Generally Accepted Accounting Principles
GAAR General Anti Avoidance Rule
IT Act The Indian Income Tax Act, 1961, as amended from time to time
ICAI Institute of Chartered Accountants of India
IFRS International Financial Reporting Standards
MNC Multi-National Corporations
N.A. Not Applicable
NECS National Electronic Clearing Services
NEFT National Electronic Funds Transfer
Companies Act/ 2013
Act
The Companies Act, 2013, as amended from time to time
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Dated: April 15, 2020
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Abbreviation Full form
NSDL National Securities Depository Limited
PAS Rules Companies (Prospectus and Allotment of Securities) Rules, 2014, as amended from time to time
Pension Fund Established under the Employee’s Pension Scheme, 1995
Provident Fund Established under the Employees’ Provident Funds Scheme, 1952
p.a. Per annum
PAN Permanent Account Number
PPOAL Private Placement Offer cum Application Letter
QIBs / Qualified
Institutional Buyers
Qualified institutional buyers, as defined under Regulation 2(1)(ss) of
the SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018, as amended
RBI The Reserve Bank of India constituted under the RBI Act
RBI Act Reserve Bank of India Act, 1934, as amended from time to time
RoC / ROC The Registrar of Companies, Mumbai, Maharashtra
RTGS Real Time Gross Settlement
Rs./ INR/ Rupees Indian Rupees
SEBI The Securities and Exchange Board of India constituted under the
SEBI Act
SEBI Act The Securities and Exchange Board of India Act, 1992, as amended from time to time
SEBI Debt
Regulations / SEBI
ILDS Regulations
SEBI (Issue and Listing of Debt Securities) Regulations, 2008 issued
by SEBI, as amended from time to time
SEBI LODR
Regulations
SEBI (Listing Obligations and Disclosure Requirements) Regulations,
2015 issued by SEBI, as amended from time to time
WDM Wholesale Debt Market
10. RISK FACTORS
The Issuer believes that the following factors may affect its ability to fulfill its obligations under
the Debentures. All of these factors are contingencies which may or may not occur and the
Issuer is not in a position to express a view on the likelihood of any such contingency occurring. These risks may include, among others, business aspects, equity market, bond market, interest
rate, market volatility and economic, political and regulatory risks and any combination of
these and other risks. Prospective Investors should carefully consider all the information in this
Information Memorandum, including the risks and uncertainties described below, before making an investment in the Debentures. To obtain a complete understanding, prospective
Investors should read this section in conjunction with the remaining sections of this Information
Memorandum, as well as the other financial and statistical information contained in this Information Memorandum. If any of the following risks, or other risks that are not currently
known or are now deemed immaterial, actually occur, the Issuer’s business, results of
operations and financial condition could suffer, the price of Debentures could decline, and the Investor may lose all or part of their investment. More than one risk factor may have
simultaneous effect with regard to the Debentures such that the effect of a particular risk factor
may not be predictable. In addition, more than one risk factor may have a compounding effect
which may not be predictable. No assurance can be given as to the effect that any combination of risk factors may have on the value of the Debentures. The inability of the Issuer to pay
interest, principal or other amounts on or in connection with the Debentures may occur for
other reasons which may not be considered significant risks by the Issuer based on information currently available to them or which they may not currently be able to anticipate. You must rely
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Dated: April 15, 2020
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on your own examination of the Issuer and this Issue, including the risks and uncertainties
involved. The ordering of the risk factors is intended to facilitate ease of reading and reference and does not in any manner indicate the importance of one risk factor over another.
Risks related to the business of the Issuer
Increased competition in the Indian automotive and tractor industry may adversely affect the
Issuer’s results of operations.
With the entry of new players in the market, both in tractor and automotive segment, the
competition intensity of the industry has increased. In addition, the Issuer continues to face
strong competition across product lines from existing Indian automotive and tractor manufacturers. Competition is expected to intensify as Indian automotive and tractor
manufacturers are able to take advantage of strategic alliances with international manufacturers
to improve their manufacturing capabilities, all Original Equipment Manufacturers (“OEMs”) are actively investing in India through specific new product development and product
technology upgrades. Today, multinational OEMs are deeply entrenched in the Indian market
with local development centres, a strong local supplier base and a good channel penetration. As a result, their cost structures have become competitive and their response to market time has
improved. They are launching products developed in India at very competitive price points in
all product sub-segments. In view of this, participation in the Indian market by foreign
manufacturers through technology transfers, joint ventures or direct investments has intensified in recent years and is expected to increase in the future. Foreign companies or joint ventures
manufacturing in India may have greater financial resources and more extensive research and
development resources than the Issuer. Global automotive manufacturers also (have access to their international range of products, which can be introduced in India. India is the world’s
largest tractor market by volume and the Tractor industry has presence of strong domestic as
well as MNC OEMs. There is intense competition in the market with each OEM trying to offer
its unique value proposition to the customer.
It is possible that the domestic and export market share of the Issuer in the sales of vehicles and
tractors could be adversely affected by such increased competition.
Delays in the launch of new models and lower than anticipated market acceptance of new
models may adversely affect the Issuer’s results of operation.
Launching new models ahead of or in competition with the Issuer’s competitors is necessary in
order for the Issuer to operate successfully in the highly competitive automotive vehicle and tractor industries. Further, with greater awareness on air quality and the need to reduce
dependence on fossil fuels, there is a growing trend towards adopting greener and more
sustainable fuels for automobiles.
The launch of new models generally requires substantial capital investment and generally, high initial production costs. If the new models do not perform according to the expectations in the
market, there could be an adverse impact on the cash generation capacity of the Issuer which
may adversely affect the Issuer’s profitability and result of operations.
Economic conditions generally and the performance of the agricultural sector in India have
a significant effect on the sales and operations of the Issuer.
A significant portion of the Issuer’s operations are situated within India and therefore demand for the Issuer’s vehicles and tractors depends to a significant extent on favourable economic
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conditions and levels of commercial activity in India. In particular, unfavourable weather
conditions may negatively impact the strength of the Indian agricultural sector resulting in lower demand for the vehicles and tractors. As a significant portion of the Issuer’s unit sales of
vehicles and almost all unit sales of tractors are in rural and semi-urban areas, the Issuer’s sales
are influenced significantly by the performance of the agricultural sector in India.
Given that the Issuer’s vehicles and tractors are predominantly purchased on credit, the Issuer’s
business may be negatively affected by increases in interest rates or any decreased availability
of consumer credit. There can be no assurance that there will not be any adverse changes in the
economic conditions of India which may significantly impact the sales and results of operations of the Issuer.
Increased preference for petrol and reduced consumer confidence in diesel fueled vehicles
may affect the Issuer’s operations.
Due to the reduced gap between petrol & diesel prices, the operating cost advantage that diesel
vehicles had over petrol vehicles, is now reduced. Moreover, increased regulation over diesel
vehicles due to environmental concerns poses regulatory uncertainty. Since a significant sales of the Issuer’s automotive products come from diesel vehicles, any decrease in customer
confidence in diesel fueled vehicles may impact the sales and operations of the Issuer.
New regulation for safety and emission may adversely affect the Issuer’s results of operation
The existing emission norms or Bharat Stage (BS) -IV were to be replaced by new BS-VI regulations from April 1, 2020. In the wake of the nationwide lockdown, the Hon’ble Supreme
Court has permitted the registration of not more than 10 percent of the pending BS-IV stock
with vehicle dealers within 10 days of lifting the lockdown in the country. The Ministry of Road Transport and Highways (“MoRTH”) has advised National Informatics Centre (“NIC”) to
facilitate the States /UTs in limited registration of BS-IV vehicles all over India except Delhi/
NCR in compliance with Supreme Court directions contained in its order dated March 27, 2020.
Consequently, the non-salability of existing BS-IV vehicles in Delhi/ NCR and the limited & conditional sale of BS-IV vehicles in rest of the country may impact the sales of the Issuer. The
issuer has been able to clear its BS IV inventory, but for fewer than 100 vehicles.
However, there are many vehicles that are sold, but not yet registered because of the closure of RTOs. The implementation of the BS-VI norms will increase the cost of the
vehicles, and the increase for diesel vehicles may be more than that for petrol vehicles. It may
impact the customer demand for Issuer’s products and may adversely impact the issuer’s operations. Moreover, concerns over safety and environmental protection may drive further
legislation and regulatory reforms and the consequent increase in costs may adversely affect
the Issuer’s result of operations.
Political and economic factors in India may have an adverse effect on the operations of the
Issuer.
A significant portion of the Issuer’s operations are located in India and a significant part of its
revenues are derived from the domestic market. The Issuer itself, and the market price and liquidity of the Debentures, may be affected by foreign exchange rates and controls, interest
rates, changes in Government policy, taxation, social and civil unrest and other political,
economic or other developments in or affecting India.
Any significant change in the Government’s or State government’s economic policies could
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adversely affect business and economic conditions in India generally, and the Issuer’s business
and financial condition and prospects in particular.
Increased volatility or inflation of commodity prices could adversely affect the Issuer’s
business.
Commodity prices have been muted so far on account of slowdown in global growth and consumption demand. Any increase in the volatility or rate of inflation of global commodity
prices, could adversely affect the Issuer.
In recent months, consumer and wholesale prices in India have stabilized; however, such prices
have exhibited inflationary trends in the past and may continue to do so in the future. The Government’s Wholesale Price Index stood at approximately 2.76 per cent and the Consumer
Price Index stood at approximately 7.35 per cent. (provisional) for the month of December
2019, respectively. Inflation rates in India have been volatile in recent years, and such volatility may continue in the future. Although the RBI has enacted certain policy measures designed to
curb inflation, these policies may not be successful. Increase in inflation in India could cause a
rise in the price of transportation, wages, raw materials and other expenses, and the Issuer may be unable to reduce the costs or pass the increased costs on to its customers by increasing the
price that the Issuer charges for its products/, and the Issuer’s financial condition, cash flows
and results of operations may therefore be adversely affected.
Delay in monsoon or insufficient rains may adversely affect Issuer’s result of operations
A normal monsoon is important for both agriculture as well as the rural economy. The Issuer’s
tractor business in particular and the automotive business, to some degree, run the risk of a drop
in demand in case of a significant variation in the monsoon. In addition, an untimely monsoon and / or significant variation in the monsoon and/or uneven spread have the potential of
adversely impacting the Issuer’s businesses.
The occurrence of natural or man-made disasters could adversely affect the Issuer’s results
of operations.
The occurrence of natural disasters, including hurricanes, floods, earthquakes, tornadoes, fires,
explosions, pandemic disease and man-made disasters, including acts of terrorism and military
actions, could disrupt the Issuer’s operations, production capabilities or distribution chains or damage its facilities located in India or outside of India, including its production facilities or
those of its suppliers or customers. Potential effects may include the damage to infrastructure
and the loss of business continuity and business information. In the event that the Issuer’s facilities are affected by any of these factors, the Issuer’s operations may be significantly
interrupted, which may materially and adversely affect business, financial condition, results of
operations, cash flows and prospects.
Spread of COVID-19 and the consequent nationwide lockdown to impact the Issuer’s
operations and financial condition
The rapid outbreak of the COVID-19 pandemic, has severely impacted the physical and
financial health of the people across the globe. To prevent the contagion in the country, a 21 day nationwide lockdown was announced by the Government of India on March 24, 2020. It
was ordered after a 14-hour voluntary public curfew on March 22, 2020, followed by
enforcement of a series of regulations in the country's COVID-19 affected regions. As a result, the demand of the Issuer’s products has seen a drastic slowdown. Moreover, it has hampered
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the supply chain for the automotive and tractor industry and hence that will also have an impact
on the supply chain of the Issuer, and this could pose challenges relating to procurement of raw materials in the foreseeable future. The Issuer is also unaware of when the nation-wide
lockdown in India may be lifted. It is likely that the lockdown be extended further, due to the
rapid spread of COVID-19 in India.
A similar lockdown has been announced by several countries, where the Issuer has a business
presence or trade relations. Consequently, it may impact the Issuer’s domestic and foreign
operations.
While, the Issuer will monitor the developments of the COVID-19 situation closely, assess and respond proactively to minimize any adverse impacts on the financial position and operating
results of the Issuer, it is possible that the Issuer’s business, financial condition and results of
operations could be adversely affected due to the COVID-19 pandemic. If the COVID-19 situation persists or worsens, it may adversely impact the Issuer’s business and the financial
condition.
Any major disruption to or failure of the Issuer’s Information Technology (IT) systems may
affect the Issuer
The business activities of the Issuer are supported by extensive IT systems. Any major
disruption to, or failure of, these systems could have an adverse effect on the operations of the
Issuer.
Dependency on a limited number of suppliers for the supply of critical components,
consumables and raw materials used in the manufacture of the Issuer’s products.
The Issuer depends on external suppliers for the supply of raw materials, components and certain spare parts for its products. A significant proportion of the components and raw
materials purchased by the Issuer are sourced from sole suppliers- The failure by a vendor to
adhere to technical specifications, quality requirements and production and delivery schedules
could affect the Issuer’s production, sales and results of production.
There can be no assurance that sole suppliers on whom the Issuer is dependent will not raise
their prices, have quality issues or experience a delay in their ability to produce or deliver
products. If the Issuer is dependent on a sole supplier or a limited number of suppliers for a critical input, the Issuer may find it difficult to replace a supplier on a timely basis and at a
reasonable cost, and the Issuer’s business and results of operations might be affected.
Exchange rate and interest rate fluctuations could adversely affect the Issuer’s results of
operations.
The Issuer’s operations are subject to risk arising from fluctuations in exchange rates with
reference to countries in which it operates or sources its raw materials. These risks primarily
stem from the relative movements of, the US dollar, the Euro, the Chinese Renminbi, Turkish Lira, Korean Won, other applicable foreign currencies and the Indian Rupee.
The exchange rates continue to be volatile. Although the Issuer engages in currency hedging in
order to decrease its foreign exchange exposure, any adverse movement in the foreign currencies may have an adverse effect on the Issuer’s financial condition and results of
operations for the future periods.
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The issuer is also exposed to volatility and fluctuations in interest rates in the various markets
in which it borrows. Any increase in the interest rates across key economies across the globe including the U.S. could result in slowdown in foreign currency inflows into the country. This
could in turn affect the value of the domestic currency and interest rates. As the Issuer has
significant operations in India and largely accesses the Indian markets for debt financing, this could adversely impact Issuer’s ability to secure financing on favorable terms.
The Issuer is subject to risks associated with product liability, warranty and recall.
The Issuer is subject to risks and costs associated with product liability, warranty and recall
should it supply defective products, parts, or related after-sales services, which could generate adverse publicity and adversely affect its business, results of operations and financial condition.
Such events could also require the Issuer to expend considerable resources in correcting these
problems and could adversely affect demand for its products.
Companies operating in India are subject to a variety of taxes and surcharges which may
affect their performance of the Issuer
Any change in tax or other levies imposed by the central and state governments in India may impact the Issuer’s result of operations. India has traditionally seen differential tax rates
between small and large passenger vehicles, with large passenger being subjected to higher tax
rates. A significant portion of the Issuer’s automotive product portfolio comprises of such large
vehicles. Any future increases or amendments in the tax rates may affect the overall pricing of the products, impacting affordability of the customer. Thus, additional tax burden could
adversely affect the Issuer’s business, cash flows and results of operations.
Inability to obtain adequate funding required to carry out the Issuer’s and its subsidiaries’
future plans for growth may impact the Issuer’s and its subsidiaries’ operations
Disruptions in global credit and financial markets and the resulting governmental actions
around the world could have a material adverse impact on issuer’s ability to meet funding needs.
The Issuer may require access to additional capital in order to carry out day-to-day operations and expansion plans. In the event of adverse market conditions, or if actual expenditure exceeds
planned expenditure, the Issuer’s external financing activities and internal sources of liquidity
may not be sufficient to support current and future operational plans, and the issuer may be forced to, or may choose to, delay or terminate the expansion plans. The issuer’s ability to
arrange external financing and the cost of such financing, as well as Issuer’s ability to raise
additional funds is dependent on numerous factors. These factors inter alia include general economic and capital market conditions, interest rates, credit availability from banks or other
lenders, investor confidence, provisions of tax and securities laws that may be applicable to the
issuer’s efforts to raise capital, the political and economic conditions in the geographic locations
in which the issuer operate, the amount of capital that other entities may seek to raise in the capital markets, the liquidity of the capital markets and issuer’s financial condition and results
of operations.
Further, the Issuer has subsidiaries and joint ventures operating in India and outside of India. Some of these subsidiaries and joint ventures will be listed on stock exchanges in respective
geographies in which they operate. Many of these subsidiaries and joint ventures could also
have trade relationship with the Issuer. Adequate fund availability with these subsidiaries and joint ventures is critical for normal operations of these companies and also for continued trade
relationship if any with the Issuer. Inability to obtain adequate funding, required to carry on
normal course of business, could impact the operations of these subsidiaries and joint ventures
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operating both in India and outside of India. This could impact the trade relationship of such
subsidiaries and joint ventures with the Issuer. Further, inability to obtain funding required for operations of such subsidiaries and joint ventures, both in India and outside of India, could pose
liquidity challenges and cause these subsidiaries and joint ventures to go in liquidation. Any
such event could inter alia pose an investment impairment risk for the Issuer.
The Issuer’s future success depends on its ability to satisfy changing customer demands by
offering innovative products in a timely manner and maintaining product competitiveness
and quality.
In recent times, customer preferences in certain more mature markets have trended towards smaller and more fuel-efficient and environmentally friendly vehicles. Climate change
concerns, increases in fuel prices, certain government regulations (such as CO2 emissions limits
and higher taxes on vehicles) and the promotion of new technologies have encouraged customers to look beyond standard purchasing factors (such as price, design, performance,
brand image and features). As a result, customers may look to the differentiation of the
technology used in a vehicle or by a manufacturer or provider of this technology. The Issuer’s operations may be significantly impacted if it fails to develop, or experience delays in
developing, fuel-efficient vehicles that reflect changing customer preferences and meet the
specific requirements of government regulations. The Issuer’s competitors may gain significant
advantages if they are able to offer products satisfying customer needs earlier than the Issuer are able to, which could adversely impact the Issuer’s sales, results of operations and financial
condition. Delays or cost overruns in implementing new product launches, expansion plans or
capacity enhancements could also materially and adversely impact the Issuer’s financial condition, results of operations and cash flows.
To stimulate demand, competitors in the automotive industry have offered customers and
dealers price reductions on vehicles and services, which has led to increased price pressures
and sharpened competition within the industry. Since the Issuer is a provider of numerous high-volume models, its profitability and cash flows are significantly affected by the risk of rising
competitive price pressures. Special sales incentives and increased price pressures in the new
vehicle business also influence price levels in the used vehicle market, with a negative effect on vehicle resale values. This could have a negative impact on the profitability of the used
vehicle business in the Issuer’s dealer organization.
There is no assurance that the Issuer’s new models will meet its sales expectations, in which case the Issuer may be unable to realize the intended economic benefits of its investments,
which would materially affect its business, results of operations and financial condition.
Non performance or underperformance of the Issuer’s distribution channels may adversely
affect the Issuer’s sales and results of operations.
The Issuer’s products are sold and serviced through a network of authorized dealers and service
centers across India and through a network of distributors and local dealers in international
markets. The Issuer monitors the performance of its dealers and distributors and to enable them to perform to its expectations. There can be no assurance, however, that the Issuer’s
expectations will be met. Any underperformance by or a deterioration in the financial condition
of the Issuer’s dealers or distributors could materially and adversely affect the Issuer’s sales and results of operations. Further, it could be compelled to provide additional support for
dealers and importers and, under certain circumstances, may even take over their obligations to
customers, which would adversely affect the Issuer’s financial position and results of operations
in the short term.
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Extended slowdown on automotive industry may affect the performance of the Issuer.
The automotive industry around the world encountered a cyclical slowdown in financial year 2020. Inadequate monsoon, lack of liquidity with non-banking financial companies to extend
credit and uncertainty regarding BS-VI implementation were some of the factors that impacted
the growth of Issuer’s business. If owing to economic conditions & other such factors, the slowdown in the industry in extended, it will have an adverse and material impact on the
performance of the Issuer.
The Issuer may, from time to time, evaluate strategic acquisitions, which may be in various
stages and the final outcome of which is inherently uncertain.
As part of its acquisition strategy, the Issuer may from time to time evaluate strategic
transactions which may be in various stages, including the submission of bids (including
binding bids) for a particular target company or asset and the negotiation of contracts and other items with respect thereto. Although the Issuer conducts business, financial and legal due
diligence in connection with the evaluation of future business or acquisition opportunities, there
can be no assurance such due diligence investigations will identify every matter that could have a material adverse effect on the Issuer should the acquisition take place. These include the
possibility that the acquired business or asset does not perform as expected, the possibility that
the price paid for the acquisition is more than the value that can be derived from such acquisition
and the risk of less cash available for operations and the incurrence of additional indebtedness to finance the acquisition as well as that of the target entity, among others. Any of these factors
could materially and adversely affect the Issuer’s business, financial condition and results of
operations.
External Risk Factors
Any downgrade of India’s sovereign debt rating by an international rating agency could have
a negative impact on the Issuer’s results of operations and financial condition.
Any downgrade of India’s credit rating for domestic and international debt by international rating agencies may adversely impact the Issuer’s ability to raise additional financing and the
interest rates and commercial terms on which such additional financing is available. This could
have an adverse effect on the Issuer’s ability to obtain financing to fund its growth on favourable terms or at all and, as a result, could have a material adverse effect on its results of operations,
financial condition and prospects.
Any legal and regulatory changes in the future could have a negative impact on the Issuer’s
results of operations and financial condition.
Future government policies and changes in laws and regulations in India and comments,
statements or policy changes by any regulator may adversely affect the Issuer’s financial results
and operation, and restrict the Issuer’s ability to perform operations effectively. The timing and content of any new law or regulation is not within the Issuer’s control and such new law,
regulation, comment, statement or policy change could have an adverse effect on its business,
results of operations and financial condition.
Further, the SEBI, the BSE, other recognized stock exchanges where the Issuer may decide to
get the Debentures listed after giving prior intimation to the Debenture Trustee or other
regulatory authorities may require clarifications on this Information Memorandum, which may cause a delay in the issuance of Debentures or may result in the Debentures being materially
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affected or even rejected.
A slowdown in economic growth in India or certain other countries could cause the Issuer
business to suffer
The Issuer’s performance and the growth of its business are necessarily dependent on the health
of the overall Indian economy. India’s economy could be adversely affected by a general rise in interest rates, inflation, natural disasters, and increase in commodity and energy prices. An
increase in inflation in India could cause a rise in the price of wages or some of the Issuer’s
other expenses. India’s economy has been affected by the current and sustained global
economic uncertainties, including periods of volatility in interest rates, inflation, currency exchange rates, commodity and power prices, adverse conditions affecting agriculture and other
factors. As a result, a slowdown in the Indian and global economies could adversely affect the
Issuer’s business.
If terrorist attacks or social unrest in India increases, the Issuer’s business could be adversely
affected.
India has from time to time experienced instances of civil unrest, terrorist attacks, war and conflicts. Some of India’s neighboring countries have also experienced or are currently
experiencing internal unrests. These events could lead to political or economic instability in
India and may adversely affect the Indian economy, the Issuer’s business, financial condition
and results of operations. India has also experienced social unrest, Naxalite violence and communal disturbances in some parts of the country.
If such tensions occur in places where the Issuer operates or in other parts of the country, leading
to overall political and economic instability, it could adversely affect the Issuer’s business, financial condition and results of operations. Military activity or terrorist attacks in the future
could influence the Indian economy by disrupting communications and making travel more
difficult, and such tensions could create a greater perception that investments in Indian
companies involve higher degrees of risk. Events of this nature in the future, as well as social and civil unrest within other countries in Asia, could influence the Indian economy and the
Issuer’s revenue, operating results and cash flows.
The extent and reliability of Indian infrastructure could adversely affect the Issuer’s results
of operations, financial condition and cash flows.
India’s physical infrastructure is less developed than that of many developed nations. Any
congestion or disruption in its transportation networks, electricity grid, communication systems or any other public facility could disrupt the Issuer’s normal business activity. Any deterioration
of India’s physical infrastructure would harm the national economy, disrupt the transportation
of goods and supplies and add costs to doing business in India. These problems could interrupt
the Issuer’s business operations, which could have an adverse effect on the Issuer’s results of operations, financial condition and cash flows.
Companies operating in India are subject to a variety of central and state government taxes
and surcharges.
Tax and other levies imposed by the central and state governments in India that affect the
Issuer’s tax liability include central and state taxes and other levies, income tax, goods and
services tax, stamp duty and other special taxes and surcharges which are introduced on a temporary or permanent basis from time to time. Moreover, the central and state tax scheme in
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India is extensive and subject to change from time to time. The statutory corporate income tax
in India in the case of a domestic company, which includes a surcharge on the tax and a health and education cess on the tax and the surcharge, may range up to 34.94 per cent. Additionally,
through the Taxation Laws (Amendment) Ordinance, 2019, the government has also amended
the Income Tax Act, 1961 with effect from April 1, 2019, to provide an option to the domestic companies to pay a reduced statutory corporate income tax of 25.17 per cent. (inclusive of
surcharge and health and education cess), provided such companies do not claim certain
specified deduction or exemptions. Further, where a company has opted to pay the reduced
corporate tax rate of 25.17 per cent., the minimum alternate tax provisions would not be applicable. Thus, the Group’s companies operating in India may choose not to claim any of the
specified deductions or exemptions and claim the lower corporate tax, in which case, the
minimum alternate tax provisions would not be applicable. Alternatively, the Issuer’s companies may choose to pay the higher of corporate tax, i.e., ranging up to 34.94 per cent,
after claiming the applicable deductions and exemptions or the minimum alternate tax at the
rate of 17.47 per cent. Any such future increases or amendments may affect the overall tax efficiency of companies operating in India and may result in significant additional taxes
becoming payable. Additional tax exposure could adversely affect the Issuer’s business and
results of operations.
The Issuer may be affected by competition law in India and any adverse application or
interpretation of the Competition Act could adversely affect its business.
The Competition Act, 2002, as amended (the “Competition Act”), regulates practices having
an appreciable adverse effect on competition in the relevant market in India. Under the Competition Act, any formal or informal arrangement, understanding or action in concert,
which causes or is likely to cause an appreciable adverse effect on competition is considered
void and results in the imposition of substantial monetary penalties. Further, any agreement
among competitors which (i) directly or indirectly determines the purchase or sale prices; (ii) limits or controls production, supply, markets, technical development, investment or provision
of services; (iii) shares the market or source of production or provision of services by way of
allocation of geographical area of market, or type of goods or services, or number of customers in the market or any other similar way; or (iv) directly or indirectly results in bid rigging or
collusive bidding, is presumed to have an appreciable adverse effect on competition. The
Competition Act also prohibits abuse of a dominant position by any enterprise. The Competition Commission of India (the “CCI”), has extra-territorial powers and can investigate
any agreements, abusive conduct or combination occurring outside India if such agreement,
conduct or combination has an appreciable adverse effect on competition in India. However,
the Issuer cannot predict the impact of the provisions of the Competition Act on the agreements entered into by it at this stage. if the Issuer is affected, directly or indirectly, by the application
or interpretation of any provision of the Competition Act, or any enforcement proceedings
initiated by the CCI, or any adverse publicity that may be generated due to scrutiny or prosecution by the CCI or if any prohibition or substantial penalties are levied under the
Competition Act, it would adversely affect the Issuer’s business, financial condition and results
of operations.
Changing laws, rules and regulations and legal uncertainties may adversely affect the
Issuer’s business and financial performance.
The Issuer’s business and operations are governed by various laws and regulations. The Issuer’s
business and financial performance could be adversely affected by any change in laws or interpretations of existing, or the promulgation of new laws, rules and regulations applicable to
the business.
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For instance, the Government has enacted the Central Goods and Services Act, 2017 and state
specific Goods and Service Tax Acts to lay the framework for a comprehensive national GST regime that combines taxes and levies by the central and state governments into a unified rate
structure. Any future increases in taxes or amendments may affect the overall tax efficiency of
companies operating in India and may result in significant additional taxes becoming payable. If, as a result of a particular tax risk materializing, the tax costs associated with certain
transactions are greater than anticipated, it could affect the profitability of such transactions. In
addition, there are uncertainties and ambiguities in relation the existing tax incentive regime.
Any adverse changes to the incentive scheme may have a material adverse effect on the Issuer’s business, prospects, financial condition and results of operations.
The General Anti-Avoidance Rules (“GAAR”) came into effect on April 1, 2017. In the
absence of any precedents on the subject, the impact of these provisions is uncertain and could result in denial of benefits amongst other consequences.
The Government of India had introduced the Income Computation and Disclosure Standards
(“ICDS”) that is applicable in computing taxable income and payment of income taxes thereon, with effect from assessment year 2017-18. The impact of any future changes in the ICDS on
the tax liability of the Issuer cannot be determined.
Furthermore in the recent years, SEBI has amended the Securities and Exchange Board of India
(Listing Obligations and Disclosure Requirements) Regulations, 2015 to introduce certain additional corporate governance requirements for listed companies, which include among
others, requirements with respect to constitution of the board of directors, secretarial audits to
be conducted and disclosures to be made in the annual report. The Issuer may face challenges in interpreting and complying with such provisions. Further, to ensure compliance with such
requirements, the Issuer may need to allocate additional resources, which may increase the
Issuer’s regulatory compliance costs and divert management attention.
There can be no assurance that the Government or state governments will not implement new regulations and policies, which will require the Issuer to obtain approvals and licenses from the
Government, state government or other regulatory bodies or which will impose onerous
requirements and conditions on the Issuer’s operations. Any such changes and related uncertainties with respect to the implementation of the new regulations may have a material
adverse effect on the Issuer’s business, financial condition, cash flows and results of operations.
Risks Relating to the Issue
The Debentures may not be a suitable investment for all purchasers.
Potential Investors should ensure that they understand the nature of the Debentures and the
extent of their exposure to risk, that they have sufficient knowledge, experience and access to
professional advisers to make their own legal, tax, accounting and financial evaluation of the merits and risks of investment in the Debentures and that they consider the suitability of the
Debentures as an investment in the light of their own circumstances and financial condition.
The Issuer cannot assure you that the Issuer’s Debentures will be listed on the Stock
Exchanges in a timely manner or at all, which may restrict your ability to dispose of the
Debentures.
In accordance with Indian law and practice, permission for listing of the Debentures will not be granted by the Stock Exchanges until after the Debentures offered in this Issue have been
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allotted. There could be a failure or delay in listing the Debentures on the Stock Exchanges
which would restrict your ability to dispose of the Debentures.
Active trading market for the Issuer’s Debentures may not develop.
The Issuer intends to list the Debentures on the WDM segment of the BSE and such other
recognised stock exchanges that the Issuer may deem fit after giving prior notice to the Debenture Trustee. The Issuer cannot provide any guarantee that the Debentures will be
frequently traded on the BSE or such other stock exchanges on which the Debentures are listed
and that there would be any market for the Debentures. If an active market for the Debentures
fails to develop or be sustained, the trading price of the Debentures could fall. If an active trading market were to develop, the Debentures could trade at prices that may be lower than the
initial offering price of the Debentures. Whether or not the Debentures will trade at lower prices
depends on many factors, including but not limited to : (i) prevailing interest rates and the market for similar securities, (ii) general economic conditions and (iii) the Issuer’s financial
condition, financial performance and future prospects.
You may not be able to recover, on a timely basis or at all, the full value of the outstanding
amounts and/ or the interest accrued thereon in connection with the Debentures.
The Issuer’s ability to pay interest accrued on the Debentures and/ or the principal amount
outstanding in connection therewith would be subject to various factors, including its financial
condition, profitability and the general economic conditions in India. The Issuer cannot assure you that it would be able to repay the principal amount outstanding on the Debentures or the
interest accrued thereon in a timely manner or at all.
Delays in court proceedings in India.
If any dispute arises between the Issuer and any other party, the Issuer or such other party may
need to take recourse to judicial proceedings before courts in India. It is not unusual for court
proceedings in India to continue for extended periods. Disposition of cases may be further
subject to various delays including multiple levels of appellate adjudication.
Compounding of Risks
An investment in the Debentures involves multiple risks and such investment should only be
made after assessing the direction, timing and magnitude of potential future changes in the interest rates, the risks associated with such investments and the terms and conditions of the
Debentures. More than one risk factor may have simultaneous effects with regard to the
Debentures such that the effect of a particular risk factor may not be predictable. In addition, more than one risk factor may have a compounding effect, which may not be predictable. No
assurance can be given as to the effect that any combination of risk factors may have on the
value of the Debentures.
Modification, waivers and substitution
The conditions of the Debentures shall contain provisions for calling meetings of Debenture
holders to consider matters affecting their interests generally. These provisions permit defined
majorities to bind all Debenture holders including Debenture holders who did not attend and vote at the relevant meeting and Debenture holders who voted in a manner contrary to the
majority.
Private & Confidential – For Private Circulation Only
(This Information Memorandum is neither a Prospectus nor a statement in Lieu of Prospectus)
Dated: April 15, 2020
28
Any downgrading in credit rating of the Debentures may affect the value of the Debentures
The Debentures proposed to be issued pursuant to this Information Memorandum have been rated ‘[ICRA] AAA’ with Stable outlook by ICRA. The Issuer cannot guarantee that the ratings
on the Debentures will not be downgraded. A downgrade in the credit ratings may lower the
value of the Debentures.
Changes in interest rates may affect the price of the Issuer’s Debentures.
All securities where a fixed rate of interest is offered, such as the Debentures, are subject to
price risk. Interest rates are highly sensitive and fluctuations thereof are dependent upon many
factors which are beyond the Issuer’s control, including the monetary policies of the RBI, de-regulation of the financial services sector in India, domestic and international economic and
political conditions, inflation and other factors. The price of such securities will vary inversely
with changes in prevailing interest rates, i.e. when interest rates rise, prices of fixed income securities fall and when interest rates drop, the prices increase. The extent of fall or rise in the
prices is a function of the existing coupon, days to maturity and the increase or decrease in the
level of prevailing interest rates. Increased rates of interest, which frequently accompany inflation and/or a growing economy, are likely to have a negative effect on the price of the
Debentures.
Uncertain trading market
The Issuer intends to list the Debentures on the Wholesale Debt Market Segment of the BSE or such other recognized stock exchanges that the Issuer may deem fit after giving prior intimation
to the Debenture Trustee. The Issuer cannot provide any guarantee that the Debentures will be
frequently traded on BSE or such other stock exchanges on which the Debentures are listed and that there would be any market for the Debentures.
The Debentures are subject to stamp duty requirements
Potential purchasers and sellers of the Debentures should be aware that stamp duty in
accordance with the laws and practices of India are required to be paid at the time of issuance of the Debentures and if the tenor of the Debentures is extended. Non-payment of stamp duty
results in the document becoming inadmissible as evidence in Indian courts. Payment and/or
delivery of any amount due in respect of the Debentures will therefore, be conditional upon the payment of all applicable stamp duty.
Potential purchasers and sellers of the Debentures should be aware that they may be required
to pay taxes in accordance with the laws and practices of India.
Payment or delivery of any amount due in respect of the Debentures will be conditional upon
the payment of all applicable taxes, duties or expenses. Potential Investors who are in any doubt
as to their tax position should consult their own independent tax advisers. In addition, potential
investors should be aware that tax regulations and their application by the relevant taxation authorities change from time to time. Accordingly, it is not possible to predict the precise tax
treatment which will apply at any given time.
The Issuer is not required to maintain a debenture redemption reserve (“DRR”)
Pursuant to a Ministry of Corporate Affairs notification dated August 16, 2019 amending
Section 71 of the Companies Act, 2013 and Rule 18 (7) of the Companies (Share Capital and
Private & Confidential – For Private Circulation Only
(This Information Memorandum is neither a Prospectus nor a statement in Lieu of Prospectus)
Dated: April 15, 2020
29
Debentures) Rules, 2014, the Issuer is not required to maintain DRR for debentures issued
through a private placement. Hence, investors shall not have the benefit of reserve funds to cover the re-payment of the principal and interest on the Debentures.
Payments made on the Debentures will be subordinated to payments to secured creditors and
certain tax and other liabilities preferred by law.
The Debentures will be unsecured and will be subordinated to all secured creditors of the Issuer
as well as certain liabilities preferred by law such as to claims of the GoI on account of taxes,
and certain liabilities incurred in the ordinary course of the Issuer’s transactions. In particular,
in the event of bankruptcy, liquidation or winding-up, the Issuer’s assets will be available to pay obligations on the Debentures only after all of those liabilities that rank senior to these
Debentures have been paid. In the event of bankruptcy, liquidation or winding-up, there may
not be sufficient assets remaining, after paying amounts relating to these proceedings, to pay amounts due on the Debentures. Further, there is no restriction on the amount of debt securities
that the Issuer may issue, that may rank above the Debentures. The issue of any such debt
securities may reduce the amount recoverable by investors in the Debentures on the Issuer’s bankruptcy, winding-up or liquidation.
11. ISSUER INFORMATION
11.1 Issuer Information
Name: Mahindra & Mahindra Limited
Registered Office: Gateway Building, Apollo Bunder, Mumbai – 400 001
Corporate office Mahindra Towers, 5th Floor, Dr. G. M. Bhosale Marg,
Auditors: Messrs B S R & Co. LLP, Chartered Accountants, (ICAI Firm Registration No. 101248W/W-100022)
Address: 5th Floor, Lodha Excelus, Apollo Mills
Compound N M Joshi Marg, Mahalaxmi Mumbai 400011
Tel: +91 22 4345 5300 Fax: +91 22 4345 5399
Legal Counsel to the Issuer: Khaitan & Co.
Address: One Indiabulls Centre, 13th Floor, Tower 1, 841 Senapati Bapat Marg, Mumbai-400 013
Phone: +91-22-66365000
Fax: +91-22-66365050
11.2 A Brief Summary of the Business / Activities of the Issuer and its line of business.
Founded in 1945 as a steel trading company, the Issuer entered into automotive manufacturing
in 1947 to bring the iconic ‘Willys Jeep’ onto the Indian roads. Over the years, the Issuer has
diversified into many new businesses in order to meet the needs of their customers. The Issuer follows a unique business model of creating empowered companies that enjoy the best of
entrepreneurial independence and group wide synergies.
This principle has led the growth into a USD 20.7 billion multinational group. Headquartered
in India, the Issuer employs 240,000 employees in over 100 countries.
The Issuer’s federated structure enables each business to chart its own future and
simultaneously leverage synergies across the entire group’s competencies. In this way, the
diversity of expertise allows the Issuer to bring their customers the best in many fields.
11.3 Brief History:
The Issuer was incorporated and registered in India under the Indian Companies Act, 1913 on
Private & Confidential – For Private Circulation Only
(This Information Memorandum is neither a Prospectus nor a statement in Lieu of Prospectus)
Dated: April 15, 2020
31
October 2, 1945 as Mahindra & Mohammed Limited. The name of the Issuer was changed to
Mahindra & Mahindra Limited on January 13, 1948.
The registered office of the Issuer is situated at Gateway Building, Apollo Bunder, Mumbai
400 001. The equity shares of the Issuer are currently listed on BSE and NSE. The global
depository receipts of Issuer’s Promoter are listed on the Luxembourg Stock Exchange and are also admitted for trading on International Order Book of the London Stock Exchange.
The Issuer is engaged in the automotive, tractor and farm mechanisation sectors. The Issuer is
inter alia, engaged in the business of manufacture and sale of tractors, general-purpose utility
vehicles, light commercial vehicles, three-wheelers and trucks and buses and develops farm mechanisation solutions which help enhance farm productivity.
11.4 Automotive Business
In 1947, the Issuer introduced India to the utility vehicle. More than 75 years later, it is still one of India’s leading utility vehicle (UV) companies. In addition to making groundbreaking UVs
like the XUV 500, Scorpio and Bolero, the Issuer offers private vehicles, pickups, and
commercial vehicles that are rugged, reliable, environmentally friendly and fuel-efficient. The Issuer has launched several new products in the recent past. These new launches were across
various product categories and have helped the Issuer to strengthen it’s presence across industry
segment. The Issuer has global presence and the Issuer’s vehicles can be found on the roads-
both paved and unpaved- of Australia, Europe, Latin America and South Africa. The Issuer continues to grow its presence in the neighboring markets of Sri Lanka, Nepal, Bangladesh and
Bhutan.
11.5 Farm Equipment Business
The Issuer began manufacturing tractors in the early 1960s for the Indian market. Nearly 60
years later, the Issuer is the number one tractor company in the world (by volume). The Issuer’s
products are making farms more prosperous in more than forty countries on six continents.
Following its vision of ‘Farm-Tech Prosperity’, the Issuer has expanded into farm-support services, including agri-mechanization solutions as well as market linkages, distribution, agri-
support information and counseling. Today, the Issuer has footprints in the United States,
Australia, New Zealand, Africa. Latin America, South Asia (Sri Lanka, Bangladesh, and Nepal) and Turkey. The Issuer is also strengthening its global presence and product portfolio in the
farm equipment business through strategic partnerships with farm equipment & agricultural
equipment manufacturers in Japan, Finland, and Turkey.
11.6 Corporate Structure of the Issuer (list of subsidiaries)
11.6.1 Details of the Issuer's subsidiaries (basis consolidated financial statements) at the end of
the reporting period are as follows:
Name of the Subsidiary Place of
Incorporatio
n and Place
of Operation
Proportion of ownership
interest *
Proportion of
voting power
where different
As at March 31, As at March 31,
2019 2018 2019 2018
Mahindra Vehicle Manufacturers
Limited
India 100.00% 100.00%
Private & Confidential – For Private Circulation Only
(This Information Memorandum is neither a Prospectus nor a statement in Lieu of Prospectus)
Dated: April 15, 2020
32
Name of the Subsidiary Place of
Incorporatio
n and Place
of Operation
Proportion of ownership
interest *
Proportion of
voting power
where different
As at March 31, As at March 31,
2019 2018 2019 2018
Mahindra Heavy Engines Limited India 100.00% 100.00%
Mahindra Electric Mobility Limited India 99.45% 99.13%
Mahindra Trucks and Buses Limited India 100.00% 100.00%
Mahindra Automobile Distributor
Private Limited
India 100.00% 100.00%
NBS International Limited India 100.00% 100.00%
Mahindra Automotive Australia Pty.
Limited
Australia 100.00% 100.00%
Ssangyong Motor Company South Korea 74.65% 72.46%
Ssangyong Motor (Shanghai) Company
Limited
China 74.65% 72.46% 100.00% 100.00%
Ssangyong European Parts Center B.V. Netherlands 74.65% 72.46% 100.00% 100.00%
Mahindra Europe S.r.l. Italy 100.00% 100.00%
Mahindra and Mahindra South Africa (Proprietary) Limited
South Africa 100.00% 100.00%
Mahindra Graphic Research Design
S.r.l.
Italy 100.00% 100.00%
Mahindra West Africa Ltd Nigeria 100.00% 100.00%
Gromax Agri Equipment Limited India 60.00% 60.00%
Auto Digitech Private Limited India 100.00% 100.00%
Kota Farm Services Limited India 47.81% 47.81% 51.02% 51.02%
Trringo.com Limited India 100.00% 100.00%
Mahindra USA Inc. U.S.A. 100.00% 100.00%
Mitsubishi Mahindra Agricultural
Machinery Co., Ltd **
Japan 66.67% 66.67%
Mitsubishi Noki Hanbai co., Ltd. Japan 66.67% 66.67% 100.00% 100.00%
Ryono Factory co., Ltd. Japan 66.67% 66.67% 100.00% 100.00%
Ryono Engineering co., Ltd. Japan 66.67% 66.67% 100.00% 100.00%
Daiya Computer Services co., Ltd. Japan 66.67% 66.67% 100.00% 100.00%
Ryono Asset Management co., Ltd. Japan 66.67% 66.67% 100.00% 100.00%
Mahindra Mexico S. de. R. L Mexico 100.00% 100.00%
Mahindra do Brasil Industrial Ltda Brazil 100.00% 100.00%
Hisarlar Makina Sanayi ve Ticaret
Anonim Şirketi
Turkey 86.80% 77.18%
Hisarlar İthalat İhracat Pazarlama
Anonim Şirketi
Turkey 86.80% 77.18% 100.00% 100.00%
Mahindra & Mahindra Financial
Services Limited
India 51.43% 51.46%
Mahindra Insurance Brokers Limited India 41.14% 41.17% 80.00% 80.00%
Mahindra Rural Housing Finance
Limited
India 46.24% 45.80% 89.91% 89.00%
Private & Confidential – For Private Circulation Only
(This Information Memorandum is neither a Prospectus nor a statement in Lieu of Prospectus)
Dated: April 15, 2020
33
Name of the Subsidiary Place of
Incorporatio
n and Place
of Operation
Proportion of ownership
interest *
Proportion of
voting power
where different
As at March 31, As at March 31,
2019 2018 2019 2018
Mahindra Asset Management Company
Private Limited
India 51.43% 51.46% 100.00% 100.00%
Mahindra Trustee Company Private Limited
India 51.43% 51.46% 100.00% 100.00%
Mahindra Lifespace Developers Limited
India 51.49% 51.51%
Mahindra Infrastructure Developers
Limited
India 51.49% 51.51% 100.00% 100.00%
Mahindra World City (Maharashtra)
Limited
India 51.49% 51.51% 100.00% 100.00%
Mahindra Integrated Township Limited India 37.77% 37.79% 73.36% 73.36%
Knowledge Township Limited India 51.49% 51.51% 100.00% 100.00%
Mahindra Residential Developers
Limited
India 37.77% 37.79% 100.00% 100.00%
Industrial Township (Maharashtra)
Limited
India 51.49% 51.51% 100.00% 100.00%
Anthurium Developers Limited India 51.49% 51.51% 100.00% 100.00%
Mahindra Water Utilities Limited India 50.97% 51.00% 99.00% 99.00%
Rathna Bhoomi Enterprises Private Limited
India 51.49% 51.51% 100.00% 100.00%
Deep Mangal Developers Private
Limited
India 51.49% 51.51% 100.00% 100.00%
Moonshine Construction Private
Limited
India 51.49% 51.51% 100.00% 100.00%
Mahindra Consulting Engineers
Limited
India 88.35% 84.78%
Mahindra Holidays & Resorts India
Limited
India 67.64% 67.71%
Mahindra Hotels and Residences India
Limited
India 67.64% 67.71% 100.00% 100.00%
Gables Promoters Private Limited India 67.64% 67.71% 100.00% 100.00%
Heritage Bird (M) Sdn. Bhd. Malaysia 67.64% 67.71% 100.00% 100.00%
Private & Confidential – For Private Circulation Only
(This Information Memorandum is neither a Prospectus nor a statement in Lieu of Prospectus)
Dated: April 15, 2020
38
Name of the Subsidiary Place of
Incorporatio
n and Place
of Operation
Proportion of ownership
interest *
Proportion of
voting power
where different
As at March 31, As at March 31,
2019 2018 2019 2018
FZ-LLC
* excluding shares issued to ESOP Trusts of the respective entities/their holding companies but
not allotted to employees.
@ entities have been treated as subsidiaries even though the Issuer holds less than half of the
voting power in these entities as it has unilateral control over the investees due to other factors
that give power like control over composition of board, management control etc.
** In addition to JPY750 million Common Stock (which represents 33.33% of the Common
stock), the Issuer owns the entire JPY2250 million “Class A” shares (shares with no voting rights); “Class A” shares have rights over dividend and liquidation on an equal basis with
Common Stock.
Details of Non-Wholly Owned Subsidiaries that have material Non Controlling Interest
Sr. No. Name of the
Subsidiary
Place of
Incorporation
and Place of
Operation
Proportion of
Ownership Interest and
voting rights held by non
controlling interests
Profit / (Loss)
allocated to non
controlling interest
Accumulated non
Controlling Interest
2019 2018 2019 2018 2019 2018
1. Mahindra &
Mahindra Financial
Services Limited
India 48.57% 48.54% 734.06 526.35 5,298.03 4,681.61
2. Ssangyong Motor
Company
South Korea 25.35% 27.54% (92.67) (144.93) 1,102.69 1,243.23
3. Individually
Immaterial Non
Controlling Interest
60.00 65.99 1,959.85 2,325.63
Total 701.39 447.40 8,360.57 8,250.47
Mahindra & Mahindra Financial Services Limited's Principal Activity - Financing of Automotive vehicles.
Ssangyong Motor Company's Principal Activity - Manufacturing & selling of vehicles & automotive parts
11.7 Key Operational and Financial Parameters
A brief overview of the financial performance of the Issuer for the past 3 (three) audited financial years and audited performance for the half year ended September 30, 2019, is given
below:
Private & Confidential – For Private Circulation Only
(This Information Memorandum is neither a Prospectus nor a statement in Lieu of Prospectus)
Dated: April 15, 2020
39
11.7.1 Standalone Basis
(Rs. in crores)
Particulars March 31, 2019
(Ind AS
Audited)
March 31, 2018 (Ind
AS Audited)
March 31, 2017 (Ind
AS Audited)
Net worth 34,209 30,294 26,786
Total Debt 2,572 2,959 2,852
Of which - Long Term
Borrowings
2,032 2,196 2,234
- Short term Borrowings 449 668 539
- Current Maturities of Long
term Borrowings
91 94 78
Net Fixed Assets 12,502 10,988 9,811
Non-Current Assets 34,626 30,966 27,360
Cash and Cash Equivalents 3,732 2,894 1,687
Current Investments 2,984 3,937 3,607
Current Assets 18,071 16,480 12,608
Current Liabilities 14,334 13,329 9,634
Net Sales 53,614 49,445 47,384
EBIDTA 6,640 6,224 4,515
EBIT 6,468 5,781 4,334
Interest 113 112 160
PAT 4,796 4,356 3,643
Dividend declared 1,057 932 807
Current Ratio 1.26 1.24 1.31
Interest Coverage Ratio 30.89 28.11 21.24
Gross Debt/Equity Ratio 0.08 0.10 0.11
Debt Service Coverage
Ratios
8.63 5.97 5.27
11.7.2 Standalone Basis
(Rs. in Crore)
Parameters
September 30, 2019
Net-worth (Total Equity) 36,601
Total Debt 2,467
(a) Non-Current Maturities of Long Term Borrowing 2,010
(b) Short Term Borrowing 362
(c) Current Maturities of Long Term Borrowing 95
Net Fixed Assets (Property, plant and equipment and Capital work-in-
progress)
13,476
Non-Current Assets 36,250
Cash and Cash Equivalents 2,749
Current Investments 3,075
Current Assets 16,886
Current Liabilities 12,039
Net Sales 23,999
EBITDA excl. Other Income 3,014
EBIT 3,075
Private & Confidential – For Private Circulation Only
(This Information Memorandum is neither a Prospectus nor a statement in Lieu of Prospectus)
Dated: April 15, 2020
40
Parameters
September 30, 2019
Interest 57
PAT 3,526
Interest coverage ratio 29.08
Debt/ equity ratio 0.07
Debt service coverage ratio 8.68
11.7.3 Consolidated Basis:
(Rs. in Crore)
Parameters
March 31, 2019 (Ind
AS Audited)
March 31, 2018
(Ind AS
Audited)
March 31, 2017
(Ind AS
Audited)
Net-worth 39,983 36,775 29,738
Total Debt 70,854 55,898 48,763
(a) Long Term Borrowing 43,526 33,809 30,125
(b) Short Term Borrowing 10,541 11,326 10,122
(c) Current Maturities of Long
Term Borrowing
16,781 10,763 8,516
Net Fixed Assets 33,743 30,451 25,268
Non-Current Assets 93,986 78,135 65,954
Cash and Cash Equivalents 8,735 6,548 4,654
Current Investments 6,107 5,350 4,701
Current Assets 69,406 59,076 48,788
Current Liabilities 58,743 49,150 39,832
Net Sales 104,721 93,265 88,983
Interest 5,021 3,987 3,648
PAT 6,017 7,958 4,051
Dividend amounts paid 1,134 963 936
Since the consolidated financials include financial services companies, EBITDA and EBIT
has not been computed.
11.7.4 Consolidated Financials
(Rs. in Crore)
Parameters
September 30, 2019
Net-worth 41,164
Total Debt 79,134
(a) Non-Current Maturities of Long Term Borrowing 52,801
(b) Short Term Borrowing 11,370
(c) Current Maturities of Long Term Borrowing 14,958
Net Fixed Assets 36,601
Non-Current Assets 97,955
Cash and Cash Equivalents 5,500
Current Investments 6,310
Current Assets 68,831
Private & Confidential – For Private Circulation Only
(This Information Memorandum is neither a Prospectus nor a statement in Lieu of Prospectus)
Dated: April 15, 2020
41
Parameters
September 30, 2019
Current Liabilities 51,491
Net Sales 49,977
Interest 2,951
PAT 1,263
Since the consolidated financials include financial services companies, EBITDA and EBIT has not been computed
11.7.5 Debt-Equity ratio of the Issuer
Particulars Prior to Issue of
Debentures
After the Issue of the
Debentures
Debt Equity Ratio (Gross) 0.07 0.10
For this disclosure the Issuer has used the figures of audited standalone financials as
on September 30, 2019.
11.7.6 Project Cost and means of financing, in case of funding of new projects:
N.A.
11.8 Information regarding the share capital, capital structure, acquisitions and
amalgamation of the Issuer:
11.8.1 Details of Share Capital as on the quarter ended December 31, 2019:
Share Capital Amount
(Rs.)
Authorized Capital
8,100,000,000 equity shares of Rs. 5 each 40,500,000,000
2,500,000 Unclassified shares of Rs. 100/- each 250,000,000
Total 40,750,000,000
Issued, Subscribed and Paid – up Capital
1,243,192,544 equity shares of Rs.5 each 6,215,962,720
Total 6,215,962,720
Private & Confidential – For Private Circulation Only
(This Information Memorandum is neither a Prospectus nor a statement in Lieu of Prospectus)
Dated: April 15, 2020
42
11.8.2 Changes in its capital structure as on last quarter ended December 31, 2019, for
the last five years:
Date of
Allotment
Number
of Equity
Shares
Face
Value
(Rs.)
Issue
Price
per
share
(Rs.)
Considerat
ion
(Cash,
other than
cash etc.)
Nature of
allotment
Cumulative
No of Equity
Shares
Equity
Share
Capital
(Rs.)
Equity
Share
Premium
in (Rs.)
(per
share)
01.04.2015 - 5 - - - 62,10,92,384 3105461920 -
08.11.2017 5,03,888
5 - - Shares
allotted
pursuant to
Scheme of
Arrangeme
nt between Mahindra
Two
Wheelers
Limited
and
Mahindra
&
Mahindra
Limited
and their
respective Shareholder
s and
Creditors
62,15,96,272
3107981360 -
26.12.2017 62,15,96,2
72
5 - - 1:1 Bonus
issue
1,24,31,92,544 6215962720 -
11.8.3 Details of any Acquisition or Amalgamation in the last 1 year:
(a) Acquisitions
(i) The Issuer invested Rs 37.5 crores in Compulsorily Convertible Cumulative Preference Shares (“CCPS”) of SmartShift Logistics
Private & Confidential – For Private Circulation Only
(This Information Memorandum is neither a Prospectus nor a statement in Lieu of Prospectus)
Dated: April 15, 2020
45
(b) List of top 10 holders of Equity Shares of the Issuer as on the quarter
ended December 31, 2019:
S.no Name of shareholder
Category of
shareholder
Total no. of
equity
shares
No of
shares in
demat form
Total
shareholdi
ng as % of
total no. of
equity
shares
1. Prudential Management and Services Pvt Ltd
Company promoters
141521940 141521940 11.38
2. LIC along with its sub
accounts
Life
insurance
corporation
134247077 134247077 10.80
3. M&M Benefit Trust-
Bharat N Doshi,
A.K.Nanda -Trustees
Company
promoters
84470428 84470428 6.79
4. JP Morgan Chase Bank, NA
Global depository
receipts
61171433 61171433 4.92
5. First State Investments ICVC- Stewart Investors
Asia Pacific Leaders
Fund
Foreign portfolio -
corp
51395920 51395920 4.13
6. Mahindra and Mahindra Employees Stock Option
Trust
Employee trusts
50575807 50575807 4.07
7. SBI Fund along with its
sub accounts
Mutual
funds
31962918 31962918 2.57
8. Caisse De Depot Et
Placement Du Quebec-
Quantum Advisors Private Limited along
with its sub account
Foreign
portfolio -
corp
23554863 23554863 1.89
9. ICICI Prudential Value
Fund along with sub account
Mutual
funds
20264964 20264964 1.63
10. Government of
Singapore
Foreign
portfolio -
Corp
13396196 13396196 1.08
Private & Confidential – For Private Circulation Only
(This Information Memorandum is neither a Prospectus nor a statement in Lieu of Prospectus)
Dated: April 15, 2020
46
11.9 Details Regarding Auditors of the Issuer:
11.9.1 Details of the Auditor of the Issuer:
Name and address Date of appointment Remarks
Messrs. B S R & Co. LLP,
Chartered Accountants, (ICAI
Firm Registration
No. 101248W/W-100022)
5th Floor, Lodha Excelus,
Apollo Mills Compound N M
Joshi Marg, Mahalaxmi Mumbai Mumbai City MH
400011 IN
August 4, 2017 Statutory Auditors holds office for a term of 5 (five) years from
the conclusion of Seventy First
Annual General Meeting
(AGM) until the conclusion of the Seventy-Sixth AGM to be
held in the year 2022
11.9.2 Changes in Auditors of the Issuer during the last three years:
Name, address Date of
appointment
/resignation
Date of cessation
(in case of
resignation)
Remarks
Messrs. B S R & Co. LLP,
Chartered Accountants, (ICAI Firm Registration
No. 101248W/W-100022)
5th Floor, Lodha Excelus, Apollo
Mills Compound N M Joshi Marg,
Mahalaxmi Mumbai Mumbai-
400011
August 4, 2017 - Statutory Auditors holds
office for a term of 5 (five) years from the
conclusion of Seventy
First Annual General
Meeting (AGM) until the
conclusion of the
Seventy-Sixth AGM to
be held in the year 2022
Messrs. Deloitte Haskins & Sells,
Chartered Accountants
(ICAI Firm Registration Number
117364W)
Tower 3, 27th - 32nd Floor,
Indiabulls Finance Centre,
Elphinstone Mill Compound,
Senapati Bapat Marg, Elphinstone
(W), Mumbai - 400 013
August 8, 2014 Retired on August
4, 2017
Retired as completed the
maximum tenure as Statutory Auditors of the
Issuer as provided under
the Companies Act, 2013
and relevant Rules
thereunder.
11.10 Promoters of the Issuer
11.10.1 The following are the details of the promoter’s shareholding in the Issuer as on
December 31, 2019
Private & Confidential – For Private Circulation Only
(This Information Memorandum is neither a Prospectus nor a statement in Lieu of Prospectus)
Dated: April 15, 2020
47
Sr. No. Name of
Shareholder
Total No of
Equity
Shares
No of
shares in
demat
form
Total
Shareho
lding as
% of
total no
of
equity
shares
No of
shares
pledged
% of shares
pledged with
respect to
shares owned
1. Keshub Mahindra 884592 884592 0.07 0 0
2. Anand Gopal
Mahindra
1430008 1430008 0.12 0 0
3. Anjali Kumari Mehra 222208 222208 0.02 0 0
4. Anuradha Mahindra 457090 457090 0.04 0 0
5. Deveshwar Jagat
Sharma
30000 30000 0.00 0 0
6. Dhruv S Sharma 30000 30000 0.00 0 0
7. Gautam P
Khandelwal
4600 4600 0.00 0 0
8. Leena S Labroo 1252384 1252384 0.10 0 0
9. Nisheeta Labroo 160000 160000 0.01 0 0
10. Aneesha Labroo 160000 160000 0.01 0 0
11. Radhika Nath 93616 93616 0.01 0 0
12. Sanjay Labroo 145440 145440 0.01 140000 96.26
13. Sudha Keshub
Mahindra
1452032 1452032 0.12 0 0
14. Uma R Malhotra 1009604 1009604 0.08 0 0
15. Anuja P Sharma 0 0 0.00 0 0
16. Prudential
Management &
Services Private
Limited
141521940 141521940 11.38 3800000 2.69
17. Kema Services
International Pvt Ltd
734832 734832 0.06 0 0
18. M&M Benefit Trust-
Bharat N Doshi, A.K.Nanda -Trustees
84470428 84470428 6.80 0 0
19. Anand Mahindra
Family Trust
0 0 0.00 0 0
20. Mahindra Family
Trust - I
0 0 0.00 0 0
21. Yuthica Mahindra
Family Trust
0 0 0.00 0 0
22. Yuthica Keshub
Mahindra
845344 845344 0.07 0 0
Total 234904118 234904118 18.90 3940000 1.68
11.10.2 Interest of Promoters
Other than as already disclosed in the Information Memorandum, the Promoters of the Issuer do not have any financial or other material interest in the Issue of Debentures
proposed to be issued under this Information Memorandum.
11.11 Details regarding the Directors of the Issuer
11.11.1 Details regarding the current directors of the Issuer:
Private & Confidential – For Private Circulation Only
(This Information Memorandum is neither a Prospectus nor a statement in Lieu of Prospectus)
Dated: April 15, 2020
48
As per the Articles of Association and subject to the provisions of Section 149 of the
Companies Act, 2013, the number of Directors shall not be less than three and more than fifteen, unless otherwise determined by the Issuer in the General Meeting. At
present, the Issuer has thirteen Directors including four executive directors:
Name, designation
and DIN
Age
Address Director
since
List of other directorships
Anand Mahindra,
Executive
Chairperson, DIN: 00004695
64 years Mahindra &
Mahindra,
Gateway Building,
Mumbai –
400001
23/11/1989 1. Tech Mahindra Limited
2. Mahindra First Choice
Wheels Limited
3. Mahindra Holdings
Limited
4. Classic Legends Private
Limited
5. Prudential Management &
Services Private Limited
6. Naandi Community Water
Services Private Limited
7. Araku Originals Private
Limited
8. Invest India
9. The Mahindra United World College of India
10. Breach Candy Hospital
Trust
11. Tech Mahindra
Foundation
Pawan Goenka,
Managing Director
and CEO
DIN: 00254502
65 years Mahindra &
Mahindra,
Mahindra
Towers, Worli,
Mumbai –
400018
23/09/2013 1. Swaraj Engines Limited
2. Mahindra First Choice
Wheels Limited
3. Mahindra Vehicle
Manufacturers Limited
4. Mahindra Electric
Mobility Limited
5. New Democratic Electoral
Trust
6. Mahindra Agri Solutions
Limited
7. Classic Legends Private
Limited
8. Mahindra & Mahindra
South Africa (Pty) Limited
9. Ssangyong Motor
Private & Confidential – For Private Circulation Only
(This Information Memorandum is neither a Prospectus nor a statement in Lieu of Prospectus)
Dated: April 15, 2020
49
Name, designation
and DIN
Age
Address Director
since
List of other directorships
Company
10. Mahindra Racing UK
Limited
11. Mitsubishi Mahindra
Agricultural Machinery Company Limited
12. Mahindra Automotive
North America Inc.
13. Automobili Pininfarina
Gmbh
14. Mahindra USA Inc
15. Indian Institute of
Technology (IIT), Madras
Anish Shah, Deputy
Managing Director
and Group CFO
DIN: 02719429
50 years Mahindra &
Mahindra,
Mahindra
Towers, Worli,
Mumbai – 400018
01/04/2020 1. Mahindra & Mahindra
Financial Services
Limited
2. Mahindra Lifespace
Developers Limited
3. Indian National
Committee- United World
College
4. PF Holdings B.V.
5. Mahindra Vehicle Sales
and Service Inc
6. Tech Mahindra Limited
7. Mahindra Trucks & Buses
Limited
Rajesh Jejurikar,
Executive Director
(Auto and Farm Sectors)
DIN: 00046823
55 years Mahindra and
Mahindra,
Mahindra Towers, Worli,
Mumbai –
400018
01/04/2020 1. Mahindra First Choice
Wheels Limited
2. Swaraj Engines Limited
3. Mahindra USA Inc.
4. Mahindra Two Wheelers
Europe Holdings S.a.r.l.
5. Peugeot Motocycles SAS
6. Mitsubishi Mahindra
Agricultural Machinery
Co., Ltd.
7. Hisarlar Makina Sanayi ve
Ticaret Anonim Şirketi
8. Hisarlar Ithalat Ihracat
Pazarlama Anonim Şirketi
Private & Confidential – For Private Circulation Only
(This Information Memorandum is neither a Prospectus nor a statement in Lieu of Prospectus)
Dated: April 15, 2020
50
Name, designation
and DIN
Age
Address Director
since
List of other directorships
9. Erkunt Traktor Sanayi A.S
10. Aliaxis SA
11. Gamaya SA
Nadir B. Godrej,
Independent
Director,
DIN: 00066195
68 years Godrej
Industries
Limited, Pirojshanagar,
Eastern Express
Highway,
Vikhroli,
Mumbai - 400
079.
28/08/1992 1. Godrej Agrovet Limited
2. Godrej Industries Limited
3. Godrej Consumer Products Limited
4. Godrej Properties Limited
5. Astec Lifesciences
Limited
6. Godrej & Boyce Mfg. Co.
Ltd.
7. Creamline Dairy Products
Limited
8. Godrej Tyson Foods
Limited
9. Isprava Vesta Private
Limited
10. Godrej International
Limited
11. ACI Godrej Agrovet
Private Limited
M. M. Murugappan
Independent
Director,
DIN: 00170478
64 years Dare House,
New # 2, NSC
Bose Road,
Chennai - 600
001
28/08/1992 1. Coromandel International
Limited
2. Carborundum Universal
Limited
3. Tube Investments of India
Limited
4. Cholamandalam Financial
Holdings Limited
5. Cholamandalam
Investment and Finance
Company Limited
6. TI Financial Holdings
Limited
7. Cyient Limited
8. Cholamandalam MS
General Insurance
Company Limited
9. Ambadi Investments
Private & Confidential – For Private Circulation Only
(This Information Memorandum is neither a Prospectus nor a statement in Lieu of Prospectus)
Dated: April 15, 2020
51
Name, designation
and DIN
Age
Address Director
since
List of other directorships
Limited
10. Murugappa Organo Water
Private Limited
11. M. M. Muthiah Reaserch
Foundation
12. IIT Madras Research Park
13. Volzhsky Abrasive Works
14. Chennai Willingdon
Corporate Foundation
15. Idea Lab (India) Private
Limited
Vishakha N. Desai,
Independent
Director,
DIN: 05292671
70 years Senior Advisor
for Global
Affairs
Office of the
President
Columbia
University
490 Riverside
Drive, MLK
Suite 509
New York, NY
10027.
30/05/2012 -
Vikram Singh
Mehta, Independent
Director,
DIN: 00041197
67 years 23, Friends
Colony, West,
New Delhi –
110 065.
30/05/2012 1. Colgate-Palmolive (India)
Limited
2. Apollo Tyres Limited
3. Jubilant Foodworks
Limited
4. Larsen and Toubro Limited
5. HT Media Limited
6. N V Advisory Services
Private Limited
7. L & T Hydro Carbon
Engineering Limited
Private & Confidential – For Private Circulation Only
(This Information Memorandum is neither a Prospectus nor a statement in Lieu of Prospectus)
Dated: April 15, 2020
52
Name, designation
and DIN
Age
Address Director
since
List of other directorships
T. N. Manoharan
Independent
Director,
DIN: 01186248
63 years No. 27,
Subramaniam
Street,
Abiramapuram,
Chennai- 600 018.
11/11/2016 1. Tech Mahindra Limited
2. Canara Bank
Vijay Kumar
Sharma, Nominee
Director of Life
Insurance
Corporation,
DIN: 02449088
61 years Life Insurance
Corporation of
India 7th Floor,
West Wing,
“Yogakshema”
J. B. Marg,
Nariman Point,
Mumbai –
400021
14/11/2018 1. ACC Limited
2. Tata Steel Limited
Haigreve Khaitan
Independent
Director,
DIN: 00005290
49 years One IndiaBulls
Centre, 13th
Floor, Tower 1, 841, Senapati
Bapat Marg,
Mumbai,
Maharashtra
400013
08/08/2019 1. Tech Mahindra Limited
2. Ceat Limited
3. Inox Leisure Limited
4. Torrents Pharmaceuticals
Limited
5. Aditya Birla Sun Life
Insurance Company
Limited
6. JSW Steel Limited
7. Borosil Renewables
Limited
Shikha Sharma
Independent
Director,
DIN: 00043265
61 years 4402, South
Tower, The
Imperial, B. B.
Nakashe Marg, Tardeo,
Mumbai - 400
034
08/08/2019 1. Tata Consumer Products
Limited
2. Ambuja Cements Limited
3. Dr. Reddy's Laboratories Limited
4. Tech Mahindra Limited
C P Gurnani
Non-Executive and
Non-Independent
Director
DIN: 00018234
61 years House Number
A 63, Sector 17,
Naida, Gautam
Buddha Nagar,
Naida 201301
01/04/2020 1. Tech Mahindra Limited
2. Comviva Technologies
Limited
3. Tech Mahindra
Foundation
4. Mahindra Educational
Institutions
Private & Confidential – For Private Circulation Only
(This Information Memorandum is neither a Prospectus nor a statement in Lieu of Prospectus)
Dated: April 15, 2020
53
Name, designation
and DIN
Age
Address Director
since
List of other directorships
5. T-HUB Foundation
6. Pininfarina S.P.A.
7. Indian Institute of
Management, Nagpur
None of the Issuer’s Directors are listed as defaulters in the Credit Information Bureau (India) Limited (CIBIL) defaulters’ list and/or Export Credit Guarantee Corporation of India (ECGC)
defaulters’ list as of the date of this Information Memorandum.
11.11.2 Details of changes in the Directors since last three years:
Name, Designation
and DIN
Date of
appointment/
resignation
Date of cessation
(in case of
resignation)
Remarks (viz. reasons for
change etc.)
Mr. Deepak S. Parekh, Independent
Director,
DIN: 00009078
Cessation on 08/08/2017
08/08/2017 Ceased to hold office as an Independent Director of the
Issuer from August 8, 2017, upon
completion of his tenure as
approved by the Shareholders at
the 68th Annual General Meeting
Mr. SB Mainak,
Nominee Director of
Life Insurance
Corporation
DIN: 02531129
Resignation on
11/05/2018
11/05/2018 Resignation
Mr. R. K. Kulkarni,
Independent
Director, DIN: 00059367
Cessation on
08/08/2019
08/08/2019 Ceased to hold office as
Independent Directors of the
Issuer from August 8, 2019, upon completion of their tenure as
approved by the shareholders at
the 68th AGM of the Issuer
Mr. Anupam Puri,
Independent
Director, DIN: 00209113
Cessation on
08/08/2019
08/08/2019 Ceased to hold office as
Independent Directors of the
Issuer from August 8, 2019, upon completion of their tenure as
approved by the shareholders at
the 68th AGM of the Issuer.
Mr. Vijay Kumar
Sharma
Nominee Director of
Life Insurance
Corporation,
DIN: 02449088
Appointment on
14/11/2018
- Appointed as a Nominee Director
of LIC on the Board of the Issuer.
Private & Confidential – For Private Circulation Only
(This Information Memorandum is neither a Prospectus nor a statement in Lieu of Prospectus)
Dated: April 15, 2020
54
Name, Designation
and DIN
Date of
appointment/
resignation
Date of cessation
(in case of
resignation)
Remarks (viz. reasons for
change etc.)
Mr. Haigreve
Khaitan Independent
Director,
DIN: 00005290
Appointment on
08/08/2019
- Appointed as an Independent
Director to hold office for a term
of five consecutive years
commencing from August 8,
2019 to August 7, 2024
Ms. Shikha Sharma
Independent
Director,
DIN: 00043265
Appointment on
08/08/2019
- Appointed as an Independent
Director to hold office for a term
of five consecutive years
commencing from August 8,
2019 to August 7, 2024.
Dr. Anish Shah, Deputy Managing
Director and Group
CFO
DIN: 02719429
Appointment on 01/04/2020
- Appointed as Deputy Managing Director and Group CFO
Mr. Rajesh Jejurikar,
Executive Director
(Auto and Farm
Sectors)
DIN: 00046823
Appointment on
01/04/2020
- Appointed as Executive Director
(Auto & Farm Sector)
Mr. C P Gurnani,
Non-Executive and
Non Independent
Director
DIN: 00018234
Appointment on
01/04/2020
- Non-executive and Non-
Independent Director
11.12 Details of Borrowings of the Issuer as on December 31, 2019
11.12.1 Details of Secured Loan Facilities
Lender’s name /
Name of the Bank
Nature of
facility/
instrume
nt
Amoun
t
sanctio
ned
(Rs.
Cr)
Principal
Amount
outstandi
ng (Rs.
Cr)
Repayme
nt date /
schedule
Security
, if
applica
ble
Credit
rating, if
applica
ble
Asset
classi
ficati
on
State Bank of India, Standard chartered
Bank, HDFC Bank
Ltd., Bank of
America, Union
Bank of India,
Central bank of
India, Bank of India,
Working capital
fund
based
facilities
under
consortiu
m
120 NIL Not required
Secured*
A1+ by CRISIL-
ICRA/CA
RE (as the
case may
be)
NA
Private & Confidential – For Private Circulation Only
(This Information Memorandum is neither a Prospectus nor a statement in Lieu of Prospectus)
Dated: April 15, 2020
55
*Secured by way of hypothecation of the Issuer’s book debts, receivables, outstanding monies
and all other current assets.
11.12.2 Details of Unsecured Loan Facilities:
Lender’ s name/
Name
of the Bank
Nature
of
facility/
instrume
nt
Amou
nt
sanctio
ned
(Rs. in
crore)
Principal
Amount
outstand
ing
(Rs. in
crore)
Repayme
nt date /
schedule
Secur
ity, if
appli
cable
Credit
rating, if
applicable
Asset
classification
HDFC Bank
Limited, SMBC,
JP Morgan
Working
Capital
Loan,
Packing
Credit etc.
400 300 Repayabl
e in FY
20 and
FY21
Unsec
ured
A1+ by
CRISIL
and India
Ratings, as
the case maybe
NA
Bank of America ECB 400 400 Repayabl
e in FY
22
Unsec
ured
NA NA
SICOM Rupee
Term
Loan
671 671 Repayabl
e in
installmen
ts from
FY 21 to
FY 28
Unsec
ured
NA NA
11.12.3 Details of non-convertible debentures issued by the Issuer:
Series ISIN Tenor/
Period
of
maturity
Coupon Amount
Issued
(Rs. in
crore)
Date of
allotment
Redempti
on
date/
Schedule
Credit
rating
Secure
d /
Unsecu
red
Securi
ty
Other
Details
viz.
Details of
IPA,
Details of
CRA
Non-
Convertible Debentures
INE101A08
088
10 Years 7.57% 475 27.09.201
6
25.09.202
6
AAA/Sta
ble by CRISIL
and “IND AAA” by
India Ratings
& Research
Pvt Ltd
Unsecur
ed
NIL CRISIL
and India Ratings &
Research Pvt Ltd
Private & Confidential – For Private Circulation Only
(This Information Memorandum is neither a Prospectus nor a statement in Lieu of Prospectus)
Dated: April 15, 2020
56
Non-
Convertible Debentures
INE101A08
070
50 Years 9.55% 500 04.07.201
3
04.07.206
3
AAA/Sta
ble by CRISIL
and [ICRA]
AAA (Stable)
by ICRA
Unsecur
ed
NIL CRISIL
and ICRA
11.12.4 List of top 10 holders of non-convertible debentures of the Issuer as on latest
quarter ended December 31, 2019:
S.no Name of
holder
Category No. of
Debenture
Face value
(Rs.)
Holding of debt
securities as a
percentage
of total debt
securities outstanding
of the Issuer
1 Yes Bank Limited Banks 2144 10,00,000 22%
2 HDFC Life Insurance
Company Limited
Qualified
Institutional Buyer
1750 10,00,000 18%
3 ICICI Lombard
General Insurance
Company Ltd
Qualified
Institutional
Buyer
1100 10,00,000 11%
4 Capgemini India Pvt Ltd Employees
Provident Fund
Trusts 930 10,00,000 10%
5 NPS Trust- A/C LIC Pension Fund
Scheme - Central
Govt
Trusts 745 10,00,000 8%
6 Bharti AXA Life Insurance Company
Ltd
Qualified Institutional
Buyer
600 10,00,000 6%
7 IDBI Federal Life
Insurance Company Limited-MRTA
Qualified
Institutional Buyer
600 10,00,000 6%
8 SBI Life Insurance
Co. Ltd
Bodies
Corporates
500 10,00,000 5%
9 Aviva Life Insurance
Company India
Limited
Qualified
Institutional
Buyer
494 10,00,000 5%
10 IDBI Federal Life
Insurance Company Limited-ILPART
Qualified
Institutional Buyer
250 10,00,000 3%
Private & Confidential – For Private Circulation Only
(This Information Memorandum is neither a Prospectus nor a statement in Lieu of Prospectus)
Dated: April 15, 2020
57
11.12.5 Details of amount of corporate guarantee issued by the Issuer along with the name
of the counterparty on behalf of whom the corporate guarantee has been issued,
as on last quarter ended December 31, 2019:
S.
NO.
Name of the subsidiaries on whose behalf
issued
Amount
(Rs. in crores)
1 Mahindra Racing UK 18.84
2 Peugeot Motocycles S.A.S 196.06
3 Sampo Rosenlew Oy 40.05
4 Pininfarina S.p.A.(effective exposure) 147.71
Total 402.66
11.12.6 Details of Commercial Paper outstanding as at December 31, 2019:
Maturity Date Amounts Outstanding
(Rs. Crores)
Nil
11.12.7 Details of Rest of the Borrowing of the Issuer not already covered above, as on the last quarter ended December 31, 2019: Nil
11.12.8 Details of all default/s and/or delay in payments of interest and principal of any
kind of term loans, debt securities and other financial indebtedness including corporate guarantee issued by the Issuer, in the past 5 years: NIL
11.12.9 Details of any outstanding borrowings taken/ debt securities issued where taken /
issued (i) for consideration other than cash, whether in whole or part, (ii) at a
premium or discount, or (iii) in pursuance of an option: NIL
11.13 Abridged version of Audited Consolidated Financial Information (like Profit & Loss
statement, Balance Sheet and Cash Flow statement) for at least last three years and
auditor qualifications, if any.
Summary of the financial position of the issuer for the last three financial years are as stipulated
in Annexure E of this Information Memorandum.
11.14 Audited Cash Flow Statement for the three years immediately preceding the date of
circulation of the Information Memorandum.
Please refer to Annexure E of this Information Memorandum.
11.15 Abridged version of Latest Audited / Limited Review Half Yearly Standalone Financial
Information (like Profit & Loss statement, and Balance Sheet) and auditors qualifications,
if any
Please refer to Annexure E of this Information Memorandum.
11.16 Any change in the accounting policies during the last three years and their effect on the
profits and reserves of the Issuer
NIL
Private & Confidential – For Private Circulation Only
(This Information Memorandum is neither a Prospectus nor a statement in Lieu of Prospectus)
Dated: April 15, 2020
58
11.17 Any material event/ development or change having implications on the financials/credit
quality (e.g. any material regulatory proceedings against the Issuer/promoters, tax
litigations resulting in material liabilities, corporate restructuring event etc) at the time
of issue which may affect the issue or the investor’s decision to invest / continue to invest
in the debt securities.
11.17.1 Impact of COVID-19
Please refer the Risk Factor “Spread of COVID-19 and the consequent nationwide lockdown
to impact the Issuer’s operations and financial condition”.
11.17.2 Joint Venture with Ford Motor Company Inc.
The Issuer and Ford Motor Company (“FMC”) have entered into definitive agreements for the formation of a joint venture wherein the Issuer will hold 51% stake in the new
entity and the balance 49% will be held by FMC. As part of the agreement, a new
company has been established which would be the eventual joint venture entity.
The new company will acquire the automotive business of Ford India on a slump sale
basis excluding the powertrain division of Ford India located at Sanand, which
essentially caters to FMCs global needs. The joint venture will develop, market and distribute ‘Ford’ brand vehicles in India and ‘Ford’ and ‘Mahindra’ branded vehicles
in emerging markets across the globe. This joint venture will further strengthen the
Issuer’s presence in automotive business and help its growth in emerging markets.
Besides, it will help achieve enhanced competitiveness through higher economies of scale across the automotive value chain.
The Issuer has received antitrust approvals from CCI, European Union and South Korea
for the Issuer to hold 51% and control over Ford India’s automotive business. The transaction is expected to be completed around mid of this year 2020 and is subject to
approvals from state governments of Tamil Nadu and Gujarat.
11.18 Names of the Debenture Trustees and Consents thereof
The Debenture Trustee for the Issue of Debentures proposed to be issued under this Information Memorandum shall be Axis Trustee Services Limited. The Debenture Trustee has given its
written consent for its appointment and inclusion of its name in the form and context in which
it appears in this Information Memorandum for the Issue of Debentures. The Debenture Trustee has given their consent to the Issuer to act as trustee for the Debenture holders under Regulation
4(4) of the SEBI Debt Regulations.
The consent letter dated April 11, 2020 from the Debenture Trustee is attached as Annexure B.
11.19 The detailed rating rationale (s) adopted (not older than one year on the date of opening
of the issue)/ credit rating letter issued (not older than one month on the date of opening
of the issue) by the rating agencies shall be disclosed.
The Debentures have been rated ‘[ICRA] AAA’ with ‘Stable’ outlook by ICRA Limited for an amount up to INR 1,000,00,00,000 vide its letter dated April 9, 2020. The credit rating letter
was confirmed, received and published on April 13, 2020 together with the credit rationale
Please refer to Annexure A to this Information Memorandum for the credit rating letter and the rationale adopted by the Credit Rating Agency.
Private & Confidential – For Private Circulation Only
(This Information Memorandum is neither a Prospectus nor a statement in Lieu of Prospectus)
Dated: April 15, 2020
59
11.20 If the security is backed by a guarantee or letter of comfort or any other document / letter
with similar intent, a copy of the same shall be disclosed. In case such document does not
contain detailed payment structure (procedure of invocation of guarantee and receipt of
payment by the investor along with timelines), the same shall be disclosed in the offer
document.
The Issue is unsecured and the Issue is not guaranteed.
11.21 Names of all the Recognized Stock Exchanges where Securities are Proposed to be Listed
clearly indicating the Designated Stock Exchange and also whether In Principle Approval
from the Recognized Stock Exchange has been obtained
The Debentures are proposed to be listed on the WDM Segment of the BSE Limited initially.
The Issuer shall comply with the requirements of the Debt Listing Agreement to the extent
applicable to it on a continuous basis. WDM Segment of BSE Limited is therefore the designated stock exchange. The Issuer has obtained ‘in-principle’ approval from WDM
Segment of the BSE to list the Debentures and same is attached as Annexure C.
The Issuer reserves the right to get the Debentures listed on other recognized stock exchanges as the Issuer may deem fit after giving prior intimation of such proposed listing to the Debenture
Trustee.
11.22 Filing of the Information Memorandum and Return of Allotment
The Issuer shall maintain a complete record of private placement offer of the Debentures in Form PAS-5 in accordance with the PAS Rules.
The Issuer shall file a return of allotment of securities under section 42 of the Companies Act
with the ROC within 15 (fifteen) days of allotment in Form PAS-3 and with the fee as provided in the Companies (Registration Offices and Fees) Rules, 2014 along with a complete list of all
holders of Debentures.
11.23 Other Details pertaining to the Issue
11.23.1 Regulations pertaining to the Issue
The Debentures being offered pursuant to this Information Memorandum are subject
to the provisions of the Companies Act, the SEBI Debt Regulations, SEBI (Listing
Obligation and Disclosure Requirements) Regulations, 2014, the Memorandum and Articles of Association of the Issuer, the terms of this Information Memorandum,
Application Form, and other terms and conditions as may be incorporated in the
Supplementary Debenture Trustee Agreement.
11.23.2 Application Process
Please see the Section headed “Issue Procedure”.
11.23.3 No-objection Certificate/that the permission/consent from the prior/ existing
creditors for a pari-passu charge being created in favour of the Debenture Trustee
to the proposed Issue has been obtained:
This is an unsecured issuance and therefore it is not applicable for this Issue.
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12. ISSUE DETAILS
12.1.1 Summary of key terms
Security Name 6.65% M&M 2023
Issuer Mahindra & Mahindra Limited
Type of Instrument Rated, Unsecured, Listed, Redeemable Non-Convertible
Debentures
Nature of Instrument Unsecured
Seniority N.A.
Arranger to the Issue Axis Bank Ltd
Debenture Trustee Axis Trustee Services Limited
Mode of Issue Private placement under electronic book mechanism of BSE
under SEBI Circular ref SEBI/HO/DDHS/CIR/P/2018/122 dated August 16, 2018 read with “Operational Guidelines for
issuance of Securities on Private Placement basis through an
Electronic Book Mechanism” issued by BSE vide their Notice No. 20180928-24 dated September 28, 2018 and/ or any
subsequent guidelines as may be issued by BSE from time to
time, in this regard.
The Issue will be through closed bidding on the EBP platform in line with BSE EBP Guidelines vide SEBI circular
SEBI/HO/DDHS/CIR/P/2018/122 dated August 16, 2018
Eligible Participants /
Eligible Investors
All QIBs, and any non-QIB investors specifically mapped by
the Issuer on the BSE BOND – EBP Platform, are eligible to bid / invest / apply for this Issue.
All participants are required to comply with the relevant
regulations/ guidelines applicable to them for investing in this Issue.
Listing BSE. Listing application shall be filed with the Stock
Exchanges within 15 days from the Deemed Date of
Allotment. In case of delay in listing beyond 20 days from the Deemed
Date of Allotment, the Issuer shall pay penal interest of 1%
(one per cent) p.a. over the Coupon Rate to the Debenture Holders for the delayed period i.e. from the expiry of 30 days
from the Deemed Date of Allotment till the listing of
Debentures.
Rating of the
Instrument
The Debentures have been rated ‘[ICRA] AAA’ with ‘Stable’ outlook by ICRA Limited for an amount up to INR 1,000
Crore vide its letter dated April 9, 2020. The credit rating letter
was confirmed, received and published on April 13, 2020
together with the credit rationale.
Issue Size INR 1000,00,00,000 (Rupees One Thousand Crore)
Option to retain over-
subscription (Amount)
N.A.
Business Day A day other than Saturday and Sunday) on which commercial
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Dated: April 15, 2020
61
banks are closed for business in the city of Mumbai,
Maharashtra.
Business Day
Convention
In the event that any date on which any Coupon payment (interest) is required to be made by the Issuer is not a Business
Day, the immediately succeeding Business Day shall be
considered as the effective date(s) for that payment. In the event that the Redemption Date(s) in respect of the Debentures
is not a Business Day, the immediately preceding Business
Day shall be considered as the effective date for redemption
of Debentures.
Objects of the Issue Proceeds of the Issue will be used for:
1. Refinancing/repayment of existing debt;
2. General corporate purpose;
3. Capital expenditure; 4. Augmentation of working capital; and/or
5. Permissible Investments as permitted by RBI, as
applicable.
Pending full utilization of proceeds from the issue, the
proceeds will be temporarily invested in money market instruments, mutual funds and deposits with banks, as
applicable, provided that the Issue proceeds shall not be used
for any purpose as not permissible by RBI for bank financing.
Details of the
utilisation of the
Proceeds
Proceeds of the Issue will be used for:
1. Refinancing/repayment of existing debt;
2. General corporate purpose;
3. Capital expenditure; 4. Augmentation of working capital; and/or
5. Permissible Investments as permitted by RBI, as
applicable.
Pending full utilization of proceeds from the issue, the
proceeds will be temporarily invested in money market instruments, mutual funds and deposits with banks, as
applicable, provided that the Issue proceeds shall not be used
for any purpose as not permissible by RBI for bank financing.
End use of the Issue to be evidenced with a certificate from
Statutory Auditor to be furnished to Debenture Trustee within
30 (thirty) days of the allotment of Debentures.
Coupon Rate 6.65% per annum payable annually on outstanding Debentures
at the end of every year from the Deemed Date of Allotment
Step Up/ Step Down
Coupon Rate
Not Applicable
Coupon Payment
Frequency
Annually
Coupon Payment April 20 of every year till Redemption Date(s). If this is not a
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Date(s) Business Day, then as per the Business Day Convention. The
last Coupon Payment Date will be the Redemption Date.
Coupon Type Fixed
Coupon Reset Process Not Applicable
Day Count Basis Actual/ Actual Basis
Interest payable on the Debentures will be calculated on the
basis of actual number of days elapsed in a year of 365 or 366 days as the case may be.
Interest on
Application Money (if
applicable)
At the Coupon Rate calculated on actual/actual day count
basis, from the date of receipt of subscription money /
application money (i.e. Pay In Date) till one day prior to the Deemed Date of Allotment which shall be payable within 7
(seven) Business Days from the Deemed Date of Allotment.
Tenor 3 years from the Deemed Date of Allotment
Redemption Date(s) The Debentures shall be redeemed at par at the end of the 3
years from the Deemed Date of Allotment i.e. 20 April 2020. If this is not a Business Day, then as per the Business Day
Convention.
Redemption Amount Rs.10,00,000 (Rupees Ten Lakhs) per Debenture payable on
Redemption Date(s)
Redemption
Premium/ Discount
NIL
Issue Price Rs.10,00,000 (Rupees Ten Lakhs) per Debenture
Discount at which
security is issued and
the effective yield as a
result of such discount
Not Applicable, as the Debentures are being issued at par
Put Date Not Applicable
Put Price Not Applicable
Call Date Not Applicable
Call Price Not Applicable
Put Notification Time Not Applicable
Call Notification Time Not Applicable
Face Value Rs. 10,00,000 (Rupees Ten Lakhs) per Debenture
Minimum bid size and
in multiples thereafter
1 Debenture of Rs. 10,00,000 (Rupees Ten Lakhs) each and in
multiple of 1 Debenture of Rs. 10,00,000 (Rupees Ten Lakhs) each thereafter
Minimum Application
and in multiples
thereof
1 Debenture of Rs. 10,00,000 (Rupees Ten Lakhs) each and in
multiple of 1 Debenture of Rs. 10,00,000 (Rupees Ten Lakhs)
each thereafter
Manner of Bidding Close Book Bidding
Mode of Allotment /
Allocation option
Uniform Yield
Issue Timing:
1. Issue / Bid Opening
April 17, 2020
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63
Date
2. Issue / Bid Closing
Date
3. Pay–in–Date
4. Deemed Date of
Allotment
April 17, 2020
April 20, 2020
April 20, 2020
Manner of allotment The allotment will be done on time priority basis in line with
BSE EBP Guidelines vide SEBI circular
SEBI/HO/DDHS/CIR/P/2018/122 dated August 16, 2018 read
with the “Updated Operational Guidelines for issuance of Securities on Private Placement basis through an Electronic
Book Mechanism” issued by BSE vide notice no. 20180928-
24 dated September 28, 2018.
Manner of settlement Settlement of the Issue will be done through Indian Clearing
Corporation Limited (ICCL) and the account details are given
in the section on Payment Mechanism of the disclosure document
Settlement cycle The process of pay-in of funds by investors and pay-out to
Issuer will be done on [T+1] day, where T is the Issue day
Issuance Mode of the
Instrument
Only in dematerialised form
Trading Mode of the
Instrument
Only in dematerialised form
Settlement Mode of
the Instrument
Payment of interest and Redemption Amount will be made by
way of RTGS/ NEFT/ any other electronic mode/ any other permitted mode of payment.
Depository NSDL and CDSL
Record Date 15 business days prior to each Coupon Payment Date and/or Redemption Date, as the case may be. For the purpose of
actual payment or as may be prescribed by SEBI, registered
debenture holders on the Record Date will be the recipients of
actual payment of Coupon at the Coupon Rate or of actual payment of redemption amount on the Redemption Date by
the Issuer.
Security
(Including
description, type of
security, type
of charge, likely date
of creation of security,
minimum security
cover, revaluation,
replacement of
security, interest to the
debenture holder over
and above the coupon
Not Applicable
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Dated: April 15, 2020
64
rate as specified in the
Trust Deed and
disclosed in the Offer
Document
Security Creation Not Applicable
Transaction
Documents
The Information Memorandum shall cover the disclosure
requirements of SEBI, as applicable.
Further the following transaction documents (“Transaction
Documents”) shall be executed:
1. Debenture Trust Deed
2. Debenture Trustee Agreement
3. Disclosure Document Upon closure of the bidding on the Bid Closing Date, Private
Placement Offer cum Application Letter in format of Form
PAS 4, as per the Companies Act 2013 to be issued to each successful bidder.
Such other documents as may be mutually agreed to between
the parties.
Conditions Precedent
to Disbursement
The Issuer shall ensure that all the consents and resolution
required to issue the Debentures are in place prior to the issue.
The Issuer shall also ensure that all regulations pertaining to this are complied with.
The pre disbursement conditions shall include, but not limited
to:
1. Constitutional documents of the Issuer 2. Resolution passed by the Loans and Investment
Committee constituted by the Board of Directors of the
Issuer for issuance of Debentures, identification of investors, trustee etc.
3. Confirmation from the Company Secretary that -
a) the total borrowings including proposed Debentures is within the limits u/s 180(1)(c); and
b) Resolution passed by the Board of Directors in its
meeting held on May 29, 2018 is valid and
subsisting and has not been modified (other than on March 27, 2020) or superseded. Further, the
borrowings are within the limits stipulated in the
Board Resolution 4. Credit Rating Letter not more than 30 days old & Rating
Rationale not more than 180 days old from the date of
pay-in of the Debenture issuance.
5. In-principle approval from BSE/NSE for listing the Debentures
6. Consent Letter from the Debenture Trustee
7. Execution of applicable Transaction Documents 8. Issuer to give following Undertaking:
a) No Event of Default has occurred and is continuing
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and no such event or circumstance will result as a
consequence of the Issuer performing any obligation contemplated under the transaction documents.
b) There is no material adverse effect and there are no
circumstances existing which could give rise, to a
material adverse effect on the Issuer.
Conditions
Subsequent to
Disbursement
Customary to transaction of such nature including but not
limited to:
1. Resolution passed by the Loans and Investment
Committee constituted by the Board of Directors of the Issuer for allotment of the Debentures.
2. Issue of Letter of Allotment on the Deemed Date of
Allotment 3. Corporate Action/ Issue of Debentures in dematerialized
form
4. Credit of dematerialized LOA/Debentures within 2 days from Deemed Date of Allotment
5. End use certificate to be provided within 60 days of
Deemed Date of Allotment
6. Listing on BSE/NSE within 20 days from the Deemed Date of Allotment
7. Execution of the Debenture Trust Deed within 90 days
from Deemed Date of Allotment.
Promoter Covenants If the Issuer ceases to be a Mahindra group anytime during the
currency of the Debentures, the Debenture holders will have
the right to accelerate the outstanding Debentures. Upon such acceleration notice being provided to the Issuer by
the Debenture holders or the Debenture Trustee, the Issuer
shall be obligated to pay the entire outstanding Debentures within 5 days from the date of receipt of such notice.
Information
Covenants
As customary for issues of this nature and as may be agreed
mutually between the Issuer, Arranger and the Debenture Trustee, and to include without limitation the following:
1. The Issuer shall furnish to the debenture holders every
year a copy of audited standalone and consolidated annual accounts of the Issuer immediately on finalization
of the same but in any case not later than 90 days from
the end of each relevant accounting period;
2. Issuer agrees to timely share the financial performance of
the Issuer (unaudited) at least every 6 months not later
than 60 days from the end of the respective period, certified by 1 (one) authorized signatory;
3. Issuer shall inform of the happening of any event that has a Material Adverse Effect and that has not specifically
been disclosed to the Debenture Trustee.
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Restricted Payments The Issuer will not declare or pay any dividends (either in cash
or property or obligations) or distributions or return of equity / quasi-equity or buy-back of equity, unless approved by the
Debenture Trustee , if an Event of Default has occurred and/or
is continuing
Material Adverse
Effect
Any change or consequence of an event, circumstance, occurrence or condition which has caused, as of any date of
determination, or could reasonably be expected to cause a
material adverse effect on:
1. The financial condition, business of the Issuer, 2. The ability of the Issuer to perform their respective
obligations hereunder or
3. The legality, validity, binding nature or enforceability of the documents executed in relation to these debentures.
Event of Defaults 1. Failure of the Issuer to make payments of the debenture
amounts (or any part thereof) on any respective due date
unless such delay of upto 2 Business Days is solely on account of administrative or technical reasons. For
clarification, there shall be no cure period other than as
mentioned herein this clause. 2. Breach of terms or covenants as stipulated in the
transaction documents
3. Cross Default by the Issuer on any of its external debt
financing subject to expiry of cure period available under respective financing agreements
4. Any event has occurred which as determined by the
majority debenture holders after reasonable due diligence and checks, is likely to have material adverse effect.
5. Any corporate action, legal proceedings or any other
procedures or step is taken in relation to voluntary winding up of the company.
6. The Issuer does not perform or comply with one or more
of its other obligations in relation to the Debentures or the
Debenture Trust Deed which default is incapable of remedy or, if in the opinion of the Debenture Trustee
capable of remedy, is not remedied within 10 days after
written notice of such default shall have been given to the Issuer by the Debenture Trustee;
7. A distress, attachment, execution or other legal process is
levied, enforced or sued out on or against any material
part of the property, assets or revenues of the Issuer; 8. It is or will become unlawful for the Issuer to perform or
comply with any one or more of its obligations under any
of the Debentures or the Debenture Trust Deed; 9. Any step is taken by governmental authority or agency or
any other competent authority, with a view to the seizure,
compulsory acquisition, expropriation or nationalization of all or (in the opinion of the Trustee) a material part of
the assets of the Issuer which is material to the Issuer;
10. Withdrawal or suspension of long term credit rating of
the Debentures. There shall be no cure period for the
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purpose of this clause.
11. Any person taking any action or commencing any legal proceedings or filing any petition, for winding-up,
insolvency, liquidation, or dissolution of the Issuer, under
the Insolvency and Bankruptcy Code, 2016 (“Code”) or
any applicable law for the time being in force. There shall be no cure period for the purpose of this clause.
Except cases where cure period is not applicable or where
specific cure period has been provided, a general cure period of 15 days shall be applicable for the other events of default
specified hereinabove.
Consequence of Event
of Default
On and at any time after the occurrence of an Event of Default,
which is continuing, the Debenture Trustee may, and shall if so directed by the Debenture Holders, with their Approval,
take the following action:
1. Accelerate the maturity of the Debentures; 2. Exercise such other rights as may be available to the
Debenture Trustee under Applicable Law or regulations.
Default Interest 1. In case of delay in execution of the Debenture Trust Deed
within 90 days from the Deemed Date of Allotment, Issuer will pay penal interest of 2% p.a. over the coupon
rate
2. In case of default of payment of interest and / or principal
redemption on the due date additional interest @ 2% p.a. over the documented rate will be payable by the Issuer.
3. In case of delay in listing of the debt securities beyond 20
days from the deemed date of allotment, the Issuer shall pay penal interest of 1 % p.a. over the coupon rate from
the expiry of 30 days from the deemed date of allotment
till the listing of Debentures The above penal interest is not withstanding to the rights of
the Debenture Holders under the Event of Default clause.
Provisions related to
Cross Default
Cross Default by the Issuer on any of its external debt financing
subject to expiry of cure period available under respective financing agreements
Illegality In the event that it becomes illegal for the Debentures holders
to lend/ hold the Debentures or maintain their commitment pursuant to change in any applicable law, the Issuer will repay
all amounts outstanding under the Debentures Documents to
the Debentures holders and/or the Debentures holders’
commitment shall stand cancelled to the extent not disbursed.
Taxes All payments to be made by the Issuer under the Debenture
documents will be made free and clear of all present and future
taxes, levies, imports, duties, withholdings or deductions of
any nature. In case of mandatory deductions that can be set off by the Debentures holders against their income tax liabilities,
the Issuer shall deduct such amounts and provide a certificate
from authorized signatory of the Issuer towards the same, within the timeline prescribed under Applicable Law.
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Role and
Responsibilities of
Debenture Trustee
The Issuer has appointed Axis Trustee Services Limited
registered with SEBI, as Debenture Trustee for the benefit of Debenture holders. The Debenture Trustee has given its
consent to the Issuer for its appointment and has entered into
a Debenture Trustee Appointment Agreement with the Issuer.
The Issuer shall enter into a Debenture Trust Deed, inter alia, specifying the terms and conditions of the Debentures and the
powers, authorities and obligations of the Issuer and the
Debenture Trustee in respect of the Debentures.
Governing Law and
Jurisdiction
The Debentures are governed by and shall be construed in accordance with the existing laws of India. Any dispute arising
thereof shall be subject to the jurisdiction of district courts of
Mumbai.
Future Borrowings The Issuer shall be entitled to borrow/ raise loans or avail of financial assistance in whatever form as also issue debentures/
notes/ other securities in any manner with ranking as pari
passu basis or otherwise and to change its capital structure, including issue of shares of any class or redemption or
reduction of any class of paid up capital, on such terms and
conditions as the Issuer may think appropriate, without the consent of, or intimation to, the Debenture Holder(s) or the
Debenture Trustee in this connection.
The Issuer shall not be required to obtain any consent(s) of
Debenture Holder(s)/ Debenture Trustee for creating any charge on its assets for its present or future borrowings/ issue
of debentures / notes/ other securities.
Purchase/ Sale of
Debentures
The Issuer may, at any time and from time to time, prior to
Redemption Date, purchase Debentures in part (on a pro-rata basis or otherwise) or full at discount, at par or at premium in
the open market or otherwise as may be determined by the
Board of Directors / Loans & Investment Committee of the Issuer. Such Debentures, at the option of the Issuer, may be
cancelled, held or resold, as permitted under applicable laws,
at such price and on such terms and conditions as the Board of Directors / Loans & Investment Committee of the Issuer may
deem fit. Such purchase / sale of Debentures shall not require
any further consent / approval of the Debenture Holder(s) /
Debenture Trustee. The right to purchase Debentures is not a call option and should not be construed as such by anyone. The
right of purchase and sale can be exercised by the Issuer
multiple times during the tenor of the Debentures without applicability of any minimum amount or price of the
Debentures. This is further clarified that any such purchase
shall be at price mutually agreed between the Issuer and
Eligible Investor.
Other Terms &
Conditions to be
detailed
Representation and Warranties (if any) to be detailed in the
Debenture Trust Deed
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Illustrative Cash Flows of the Debentures
Cash Flows per Debentures (FV of Rs. 10,00,000/-)
Date Interest Principal
Cash Flows
(Rs.)
April 20, 2020 -10,00,000.00 -10,00,000.00
April 20, 2021 66,500.00 66,500.00
April 20, 2022 66,500.00 66,500.00
April 20, 2023 66,500.00 10,00,000.00 10,66,500.00
13. ISSUE PROCEDURE
The Issuer proposes to Issue the Debentures on the terms set out in this Information Memorandum. The Debentures being offered pursuant to this Information Memorandum are
subject to the provisions of the Companies Act, the SEBI Debt Regulations, the SEBI LODR
Regulations, the Memorandum and Articles of Association of the Issuer, the terms of this
Information Memorandum, Application Form, and other terms and conditions as may be incorporated in the Supplementary Debenture Trustee Agreement. This section applies to all
applicants. Please note that all applicants are required to make payment of the full application
amount along with the Application Form.
The Issuer or any of its promoters or directors is not a willful defaulter as on the date of filing
of this Information Memorandum and neither the Issuer or any of its promoters or its directors
have been categorized as willful defaulter by any bank or financial institution or consortium thereof, in accordance with the guidelines on willful defaulters issued by the Reserve Bank of
India.
13.1 Who Can Bid/ Apply/ Invest
The Investors as specified in Section “Summary of Key Terms” are eligible to apply for the Debentures.
All Applicants are required to comply with the relevant regulations/guidelines applicable
to them for investing in the Issue in accordance with the norms approved by GoI, RBI or
any other statutory body from time to time, including but not limited to BSE EBP
Guidelines as published by BSE on its website for investing in this Issue. The contents of
this Information Memorandum and any other information supplied in connection with
this Private Placement Offer Letter are intended to be used only by those Investors to
whom it is distributed. It is not intended for distribution to any other person and should
not be reproduced or disseminated by the recipient.
13.2 Who Cannot Apply
The persons entities as set out in Section headed “Summary of Key Terms” as non-eligible
classes of investors, shall not be eligible to participate in the Issue and any Applications from
such persons and entities shall be rejected.
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13.3 Documents to be provided by Eligible Investors
In order to be able to bid under the BSE Bond - EPB Platform, eligible Investors must have provided the requisite documents (including but not limited to know your customer) in
accordance with the SEBI and BSE Operational Guidelines or applicable law or as requested
by the Issuer. The Issuer is entitled at any time to require an eligible Investor to provide any know your customer or other documents as may be required to be maintained by it or delivered
to a third party by it in accordance with applicable laws.
13.4 Application under Power of Attorney or by Eligible Investors
In case of Applications made under a power of attorney or by a company or a body corporate or registered society or mutual fund, and scientific and/or industrial research organizations or
trusts etc., the relevant power of attorney or the relevant resolution or authority to make the
Application, as the case may be, together with the certified true copy thereof along with the certified copy of the memorandum and articles of association and/or bye-laws, as the case may
be, shall be attached to the Application Form or lodged for scrutiny separately with the
photocopy of the Application Form, quoting the serial number of the Application Form, failing which the applications are liable to be rejected.
13.5 How to Apply or Bid
All Eligible Investors should refer the operating guidelines for issuance of debt securities on
private placement basis through an electronic book mechanism as available on the website of BSE / NSE. Investors will also have to complete the mandatory know your customer
verification process. Investors should refer to the BSE EBP Guidelines in this respect.
The Issue details shall be entered on the BSE Bond - EPB Platform by the Issuer on T-2 basis, where T being the bidding date, in accordance with the Operational Guidelines.
The Issue will be open for bidding for the duration of the bidding window that would be
communicated through the Issuer’s bidding announcement on the BSE Bond EPB - Platform,
at least 1 (one) Business Day before the start of the Issue opening date.
13.6 Some of the key guidelines in terms of the current Operational Guidelines on issuance of
securities on private placement basis through an EBP mechanism, are as follows:
13.6.1 Modification of Bid
Investors may note that modification of bid is allowed during the bidding period /
window. However, in the last 10 (ten) minutes of the bidding period / window, revision
of bid is only allowed for improvement of coupon or yield and upward revision of the bid amount placed by the Investor.
13.6.2 Cancellation of Bid
Investors may note that cancellation of bid is allowed during the bidding period /
window. However, in the last 10 (ten) minutes of the bidding period or window, no cancellation of bids is permitted.
13.6.3 Multiple Bids
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Investors may note that multiple bid are permitted. Multiple bids by the Arranger to the
Issue are permitted as long as each bid is on behalf of different Investors / same Investors.
13.6.4 Offer or Issue of executed Private Placement Offer Letter to successful eligible
Investors
The signed copy of the Private Placement Offer Letter along with the Application Form
will be issued to the successful eligible Investors, who are be required to complete and
submit the Application Form to the Issuer in order to accept the offer of the Debentures. However, Investors should refer to the Operational Guidelines as prevailing on the date
of the bid.
13.7 Bids by the Arranger
13.7.1 The Arrangers as mapped on BSE Bond EPB – Platform by the Issuer are allowed to
bid on a proprietary, client and consolidated basis. At the time of bidding, the Arranger
is required to disclose the following details to the BSE Bond EPB - Platform:
(a) Whether the bid is proprietary bid or is being entered on behalf of an eligible
Investor or is a consolidated bid, i.e., an aggregate bid consisting of proprietary
bid and bid(s) on behalf of eligible Investors.
(b) For consolidated bids, the Arranger shall disclose breakup between proprietary bid and bid(s) made on behalf of Eligible Investors.
(c) For bids entered on behalf of eligible Investors, the Arranger shall disclose the
following:
(i) Names of such eligible Investors;
(ii) Category of the eligible Investors; and
(iii) Quantum of bid of each eligible Investor.
13.8 Withdrawal of Issue
The Issuer reserves the right to withdraw the Issue prior to the Issue closing date, at its discretion, and including but not limited to the event of any unforeseen development adversely
affecting the economic and regulatory environment or any other force majeure condition
including any change in applicable law, pursuant to the conditions set out under the Operational Guidelines.
Further, the Issuer shall be permitted to withdraw from the Issue process on the following
events:
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13.8.1 The Issuer is unable to receive the bids up to the base Issue Size; or
13.8.2 A bidder has defaulted on payment towards the Allotment, within stipulated timeframe, due to which the Issuer is unable to fulfill the base Issue Size; or
Provided that the Issuer shall accept or withdraw the Issue on the BSE Bond EPB -
Platform within 1 (one) hour of the closing of the bidding window, and not later than 5 (five) pm on the Issue closing date. However, Eligible Investors should refer to the
Operational Guidelines prevailing on the date of the bid.
13.9 Determination of Coupon
The Coupon payable on the Debentures is a fixed rate coupon.
13.10 Right to Accept or Reject Applications
The Issuer reserves its full, unqualified and absolute right to accept or reject the application, in
part or in full, without assigning any reason thereof. The rejected Applicant will be intimated along with the refund warrant, if applicable. No interest on Application money will be paid on
rejected Applications. The Application Form that is not complete in all respects is liable to be
rejected and would not be paid any interest on the Application money.
For further instructions regarding the application for the Debentures, eligible Investors are
requested to read the instructions provided in the Application Form.
Application would be liable to be rejected on one or more technical grounds, including
but not restricted to:
13.10.1 Number of Debentures applied for is less than the minimum application size; and
13.10.2 Debenture holder details as may be required is not given;
13.11 Basis of Allocation
Allocation shall be made as approved by the Issuer in accordance with applicable SEBI
regulations, Operational Guidelines, and applicable laws. post completion of bidding process,
the issuer will upload the provisional allocation on the BSE Bond EPB - Platform. Post receipt
of details of the successful Eligible Investors, the Issuer will upload the final allocation file on the BSE Bond EPB - Platform.
The allotment of valid applications received on the closing day shall be done on “time priority”
basis.
13.12 Applications by Successful Investors
Original Application Forms complete in all respects must be submitted to the corporate office
of Issuer before the last date indicated in the Issue time table or such extended time as decided by the Issuer accompanied by details of remittance of the Application money. The Application
Form will constitute the acceptance required under Section 42 of the Companies Act and the
PAS Rules. Successful Investors should ensure to do the funds pay-in from their same bank
account which is updated by them in the BSE Bond - EBP Platform while placing the bids. In case of mismatch in the bank account details between BSE Bond – EBP Platform and the bank
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account from which payment is done by the successful investor, the payment would be returned
back. Payment should be made by the deadline specified by the BSE. Successful bidders should do the funds pay-in to the bank accounts of the clearing corporation of the relevant Exchanges
(“Designated Bank Account”).
Upon final allocation by the Issuer, and confirmation by the Issuer to go ahead with the Allotment, the Issuer or the Registrar on behalf of the Issue shall instruct the Depositories on
the Pay-In Date, and the Depositories shall accordingly credit the allocated Debentures to the
demat account of the successful Investor(s). Upon instructions of the Registrar or the Issuer,
the Depositories shall confirm to the clearing corporation of the relevant Exchanges that the Debentures have been transferred to the demat account(s) of the successful Investor(s). Upon
confirmation from the Depository, the clearing corporation of the relevant Exchanges shall
transfer funds to the Designated Bank Account of the Issuer.
Successful bidders must do the funds pay-in to the Designated Bank Account up to 10:30 am
on the Pay-In Date (“Pay-in Time”). Successful bidders should ensure to do the funds pay-in
from their same bank account which is updated by them in the BSE Bond - EBP Platform while placing the bids. In case of mismatch in the bank account details between BSE Bond – EBP
Platform and the bank account from which payment is done by the successful bidder, the
payment would be returned back. Provided that, in case of bids made by the Arranger on behalf
of eligible Investors, funds pay-in shall be made from the bank account of such eligible Investors. Cheque(s), demand draft(s), money orders, postal orders will not be accepted. The
Issuer assumes no responsibility for any applications lost in mail.
Note: In case of failure of any successful Investor to complete the funds pay-in by the Pay-in Time or the funds are not received in the Designated Bank Account of the clearing corporation
of the relevant Exchanges by the Pay-in Time for any reason whatsoever, the bid will liable to
be rejected and the Issuer and/or the Arranger shall not be liable to the successful Investor.
13.13 Post-Allocation Disclosures by the EBP
Upon final allocation by the Issuer, the Issuer shall disclose the Issue Size, coupon rate, ISIN,
number of successful bidders, category of the successful bidder(s), etc., in accordance with the
SEBI/HO/DDHS/CIR/P/2018/05 dated January 5, 2018, and SEBI circular dated August 16, 2018 bearing reference number SEBI/HO/DDHS/CIR/P/2018/122, each as amended. The EBP
shall upload such data, as provided by the Issuer, on its website to make it available to the
public.
13.14 Terms of Payment
The full-face value of the Debentures applied for is to be paid along with the Application Form
as set out above.
13.15 Acknowledgements
No separate receipts will be provided by the Issuer for the Application money.
13.16 Deemed Date of Allotment
The cut-off date declared by the Issuer from which all benefits under the Debentures including interest on the Debentures shall be available to the Debenture holders is the Deemed Date of
Allotment. The actual allotment of Debentures (i.e. approval from the Board of Directors or a
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Committee thereof) may take place on a date other than the Deemed Date of Allotment. The
Issuer reserves the right to keep multiple allotment date(s)/deemed date(s) of allotment at its sole and absolute discretion without any notice. If in case, the issue closing date changes (i.e.
preponed/postponed), then the Deemed Date of Allotment may also be changed (preponed/
postponed) by the Issuer, at its sole and absolute discretion.
13.17 Letter(s) of Allotment/ Debenture Certificate(s)
The beneficiary account of the Investor(s) with NSDL or CDSL or Depository Participant will
be given initial credit within 2 (two) days from the Deemed Date of Allotment. The initial credit
in the account will be akin to a letter of Allotment. On completion of the all-statutory formalities, such credit in the account will be akin to a Debenture certificate.
13.18 Fictitious applications
Any person who makes, in fictitious name, any application to a body corporate for acquiring, or subscribing to, the Debentures, or otherwise induced a body corporate to allot, register any
transfer of Debentures therein to them or any other person in a fictitious name, shall be
punishable under the extant laws.
13.19 Instrument Specific Details
13.19.1 Market Lot
The market lot will be one Debenture. Since the Debentures are being issued only in
dematerialised form, the odd lots will not arise either at the time of issuance or at the time of transfer of Debentures.
13.19.2 Trading of Debentures
The marketable lot for the purpose of trading shall be one Debenture that is, in denomination of Rs. 10 (ten) Lakh. Trading of Debentures will be permitted in
dematerialised mode only and such trades shall be cleared and settled in recognised
stock exchange(s) subject to conditions specified by SEBI. In the event of trading in
Debentures which has been made over the counter, the trades shall be executed and reported on a recognized stock exchange having a nation-wide trading terminal or such
other platform as may be specified by SEBI.
13.19.3 Mode of Transfer of Debentures
Debentures shall be transferred subject to and in accordance with the rules or
procedures as prescribed by the NSDL, CDSL or Depository Participant of the
transferor and transferee and any other applicable laws and rules notified in respect thereof. The normal procedure followed for transfer of securities held in dematerialized
form shall be followed for transfer of these Debentures held in electronic form. The
seller should give delivery instructions containing details of the buyer’s Depository
Participant account to his Depository Participant. The provisions of the Depositories Act, and the Companies Act, and all other applicable laws shall apply for transfer and
transmission of Debentures.
The transferee(s) should ensure that the transfer formalities are completed prior to the Record Date. In the absence of the same, interest will be paid or redemption will be
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made to the person, whose name appears in the records of the Depository. In such cases,
claims, if any, by the transferee(s) would need to be settled with the transferor(s) and not with the Issuer.
13.19.4 Interest on the Debentures
The Debentures shall carry interest at the coupon rates in accordance with the term sheet (subject to deduction of tax at source at the rates prevailing from time to time
under the provisions of the IT Act or any other statutory modification or re-enactment
thereof for which a certificate will be issued by the Issuer) on the outstanding principal
amount of Debentures until final redemption.
If any interest payment date falls on a day which is not a Business Day, then payment
of interest will be made on the next day that is a Business Day without interest for such
additional days. It is clarified that Interest/redemption with respect to debentures, interest/redemption payments shall be made only on the days when the money market
is functioning in Mumbai.
13.19.5 Deduction of Tax at Source
Tax, as applicable, under the IT Act or any other statutory modification or re-enactment
thereof will be deducted at source. The Eligible Investor(s) desirous of claiming
exemption from deduction of income tax at source on the interest on Application money
are required to submit the necessary certificate(s), in duplicate, along with the Application Form in terms of the rules made under the IT Act. Interest payable
subsequent to the Deemed Date of Allotment of Debentures will be treated as “Interest
on Securities” in accordance with the rules under the IT Act. Debenture holders desirous of claiming exemption from deduction of income tax at source on the interest
payable on Debentures should submit tax exemption certificate/document (if any),
under the IT Act, at the head office of the Issuer, at least 45 (forty-five) days before the
payment becoming due. Regarding deduction of tax at source and the requisite declaration forms to be submitted, prospective Investors are advised to consult their
own tax consultant(s).
13.19.6 List of Beneficial Owners
The Issuer shall request the Depository to provide a list of Beneficial Owners as at the
end of the Record Date to the RTA and the Issuer. This list shall be considered for
payment of interest or repayment of principal amount, as the case may be.
13.19.7 Record Date
Record date of interest shall be 15 (fifteen) days prior to each interest payment date and
15 (fifteen) days prior to the date of Maturity. Interest shall be paid to the person whose
name appears as sole/first in the Register of Debenture holders/beneficiaries position of the Depositories on the Record Date or to the Debenture holders who have converted
the Debentures to physical form and their name is registered on the registers maintained
by the Issuer or the Registrar. In the event of the Issuer not receiving any notice of transfer at least 15 (fifteen) days before the respective due date of payment of interest
and at least 15 (fifteen) days prior to the maturity date, the transferees for the Debenture
shall not have any claim against the Issuer in respect of interest so paid to the registered Debenture holder.
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13.19.8 Undertaking regarding transfer
The Debentures shall be transferred subject to and in accordance with the rules/ procedures as prescribed by the NSDL/CDSL/Depository Participant of the transferor/
transferee and any other applicable laws and rules notified in respect thereof. The
normal procedure followed for transfer of securities held in dematerialized form shall be followed for transfer of these Debentures held in electronic form. The seller should
give delivery instructions containing details of the buyer’s DP account to its Depository
Participant. The transferee(s) should ensure that the transfer formalities are completed
prior to the Record Date. In the absence of the same, interest will be paid/ redemption will be made to the person, whose name appears in the records of the Depository. In
such cases, claims, if any, by the transferee(s) would need to be settled with the
transferor(s) and not with the Issuer.
If the Debentures are rematerialized and held in physical form, transfer of Debentures
shall be as per the relevant provisions of Companies Act, and Ministry of Corporate
Affairs notification number GSR 463(E) dated June 5, 2015 issued in respect of government companies or any other relevant law. However, the Issuer reserves it right
to duly confirm the identity of the transferor and conduct necessary due diligence
wherever required.
13.19.9 Redemption and Computation
The face value of the Debentures will be redeemed in accordance with details in Section
“Summary of Key Terms” from the Deemed Date of Allotment. The Debentures will
not carry any obligation, for interest, or otherwise, after the Redemption Date. The Debentures shall be taken as discharged on payment of the redemption amount by the
Issuer on maturity to the registered Debenture holders whose names appear in the
Register of Debenture holders on the Record Date or the Beneficial Owners in
accordance with the list provided by the Depositories. Such payment will be a legal discharge of the liability of the Issuer towards the Debenture holders. If the Redemption
Date falls on a day which is not a Business Day, then the payment due shall be made
on the previous Business Day but without liability for making payment of interest after actual date of redemption. It is clarified that any interest or redemption amounts with
respect to Debentures, interest or redemption amount payments shall be made only on
the days when the money market is functioning in Mumbai.
13.19.10 Settlement/ Payment on Redemption
Payment on redemption will be made by way of cheque(s) or redemption warrants(s)
or demand draft(s) or credit through RTGS system in the name of the Debenture holders
whose name appear on the list of Beneficial Owners given by Depository to the Issuer
or the Debenture holders (who have converted the Debentures to physical form), whose
names are registered on the register maintained by the Issuer or Registrar as on the
Record Date. The Debentures shall be taken as discharged on payment of the
redemption amount by the Issuer on maturity to the list of Debenture holders as
provided by NSDL or CDSL or Depository Participant. Such payment will be a legal
discharge of the liability of the Issuer towards the Debenture holders. On such payment
being made, the Issuer shall inform NSDL or CDSL or Depository Participant and
accordingly the account of the Debenture holders with NSDL or CDSL or Depository
Participant shall be adjusted. The Issuer’s liability to the Debenture holders towards all
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their rights including for payment or otherwise shall cease and stand extinguished from
the due date of redemption in all events. Further the Issuer will not be liable to pay any
interest, or compensation from the date of redemption. On the Issuer dispatching/
crediting the amount to the Beneficiary(s) as specified above in respect of the
Debentures, the liability of the Issuer shall stand extinguished.
13.19.11 Right of Debenture holders(s)
Debenture holder is not a shareholder. The Debenture holders will not be entitled to
any other rights and privilege of shareholders other than those available to them under
statutory requirements. The Debentures shall not confer upon the holders the right to
receive notice, or to attend and vote at the general meeting of the Issuer. The principal
amount and interest on the Debentures will be paid to the registered Debentures only,
and in case of joint holders, to the one whose name stands first.
Further, the Debentures shall be subject to the provisions of the Companies Act, and
the relevant rules and regulations, the Articles of Association of the Issuer, the terms
of this issue of the Debentures and the other terms and conditions as may be incorporated in the Debenture Trust Deed and other documents that may be executed
in respect of these Debentures.
13.19.12 Modification of Rights
The rights, privileges, terms and conditions attached to the Debentures may be varied,
modified or abrogated with the consent, in writing, of those holders of the Debentures
who hold majority of the outstanding amount of the Debentures (or any limit as
specified under Companies Act or any other provision of law) or with the sanction accorded pursuant to a resolution passed at a meeting of the Debenture holders,
provided that nothing in such consent or resolution shall be operative against the Issuer
where such consent or resolution modifies or varies the terms and conditions of the Debentures, if the same are not acceptable to the Issuer.
13.19.13 Right to further issue under the ISINs
The Issuer reserves right to effect multiple issuances under the same ISIN with
reference to the ISIN Circulars. The Issue can be made either by way of creation of a fresh ISIN or by way of issuance under the existing ISIN at premium, par or discount
as the case may be in line with the ISIN Circulars.
13.19.14 Right to Buyback, Re-purchase and Re-issue
The Issuer will have the right, power and authority, exercisable at its sole and absolute
discretion from time to time, to buyback or re-purchase a part or all of its Debentures
from the secondary markets or through a tender offer or any other method permitted under applicable law, at any time prior to the Redemption Date, subject to applicable
law and in accordance with the applicable guidelines or regulations, if any.
In the event of a part or all of the Issuer’s Debentures being bought back or repurchased
as aforesaid or redeemed under any circumstances whatsoever, the Issuer shall have, and shall be deemed always to have had, the right, power and authority to re-issue the
Debentures, either by re-issuing the same Debentures or by issuing other debentures in
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their place.
Further the Issuer, in respect of such bought back or re-purchased or re-deemed Debentures shall have the right, power and authority, exercisable either for a part or all
of those Debentures, to cancel, keep alive, appoint nominee(s) to hold or re-issue at
such price and on such terms and conditions as it may deem fit and as permitted under the ISIN Circulars or by applicable laws or regulations.
13.19.15 Future Borrowings
The Issuer shall be entitled to borrow/ raise loans or avail of financial assistance in
whatever form as also issue debentures/ notes/ other securities in any manner with ranking as pari passu basis or otherwise and to change its capital structure, including
issue of shares of any class or redemption or reduction of any class of paid up capital,
on such terms and conditions as the Company may think appropriate, without the consent of, or intimation to, the Debenture Holder(s) or the Debenture Trustee in this
connection.
The Issuer shall not be required to obtain any consent(s) of Debenture Holder(s)/ Debenture Trustee for creating any charge on its assets for its present or future
borrowings/ issue of debentures / notes/ other securities
13.19.16 Ranking of Debentures
The Debentures are unsecured, redeemable, non-convertible, non-cumulative debentures. The Debentures shall rank pari-passu inter se and, subject to any
obligations preferred by mandatory provisions of the law prevailing from time to time,
shall also as regards repayment of principal and payment of interest, rank pari-passu with all other existing unsecured borrowings (except subordinated debt) of the Issuer.
13.19.17 Notices
All notices required to be given by the Issuer or by the Debenture Trustee to the
Debenture holders shall be deemed to have been given if sent by ordinary post/ courier to the original sole/first allottees of the Debentures and/ or if published in one all India
English daily newspaper and one regional language newspaper.
All notices required to be given by the Debenture holder(s), shall be sent by registered post or by hand delivery to the Issuer or to such persons at such address as may be
notified by the Issuer from time to time.
13.19.18 Investor Relations and Grievance Redressal
Arrangements have been made to redress investor grievances expeditiously as far as
possible, the Issue endeavours to resolve the Investors’ grievances within 30 (thirty)
days of its receipt. All grievances related to the issue quoting the Application number
(including prefix), number of Debentures applied for, amount paid on application and bank and branch / the Issuer collection centre where the Application was submitted,
may be addressed to the resource mobilization unit at the head office of the Issuer.
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14. MATERIAL AGREEMENTS/ DOCUMENTS
A statement containing particulars of the dates of, and parties to all material contracts and
agreements involving the Debentures of the Issuer is set out below. The following are the
material documents and agreements:
1. Memorandum and Articles of Association of the Issuer, as amended to date.
2. Certificate of incorporation dated October 2, 1945.
3. Credit rating letter dated April 9, 2020 issued by ICRA, confirmed, received and published on
April 13, 2020 together with the credit rationale.
4. Auditor’s report and standalone financial statements for the Financial Year March 31, 2019
prepared under IND-AS and consolidated financial statements prepared under IND-AS for the
Financial Year March 31, 2019
5. Auditor’s report and standalone financial statements for the Financial Year March 31, 2018 and
2017 prepared under Indian GAAP and consolidated financial statements prepared under Indian
GAAP for the Financial Year March 31, 2018 and 2017.
6. Annual report of the Issuer for the Financial Year ended March 31, 2019, March 31, 2018 and
March 31, 2017.
7. Board resolution dated May 29, 2018 read together with the resolution dated March 27, 2020
authorizing issue of Debentures offered on private placement basis;
8. Loans & Investment Committee of Directors resolution dated April 9, 2020 for the appointment
of intermediaries;
9. Loans & Investment Committee of Directors resolution dated April 14, 2020 approving the Information Memorandum;
10. Letter of consent from the Debenture Trustee dated 11 April 2020 for acting as Debenture
Trustee for and on behalf of Debenture holders.
11. Tripartite agreement between the Issuer, NSDL and KFin Technologies Private Limited for issue of Debentures in dematerialized form.
12. Tripartite agreement between the Issuer, CDSL and KFin Technologies Private Limited for
issue of Debentures in dematerialized form.
13. Debenture trustee agreement between the Issuer and Debenture Trustee.
14. Debenture trust deed in favour of Debenture Trustee.
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15. DISCLOSURES PERTAINING TO WILFUL DEFAULT (IF ANY)
(a) Name of the bank declaring the Issuer as a wilful defaulter: NIL
(b) The year in which the Issuer is declared as a wilful defaulter: NIL
(c) Outstanding amount when the Issuer is declared as a wilful defaulter: NIL
(d) Name of the Issuer declared as a wilful defaulter: NIL
(e) Steps taken, if any, for the removal from the list of wilful defaulters: NIL
(f) Other disclosures, as deemed fit by the issuer in order to enable investors to take informed
decisions: NIL
(g) Any other disclosure as specified by the Board: NIL
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DECLARATION BY THE ISSUER
The Issuer hereby declares that this Information Memorandum contains full disclosure in
accordance with SEBI Debt Regulations, the Companies Act, 2013 and Operational Guidelines.
The Issuer also confirms that this Information Memorandum does not omit disclosure of any
material fact which may make the statements made therein, in the light of the circumstances
under which they are made, misleading. The Information Memorandum also does not contain
any false or misleading statement. The Issuer accepts no responsibility for the statements made otherwise than in this Information Memorandum or in any other material issued by or at the
instance of the Issuer and that anyone placing reliance on any other source of information would
be doing so at his own risk.
The Issuer declares that all the relevant provisions of the relevant regulations or guidelines
issued by SEBI and other applicable laws have been complied with and no statement made in this Information Memorandum is contrary to the provisions of the regulations or guidelines
issued by SEBI and other applicable law, as the case may be.