Company Information

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TECH MAHINDRA LTD.

NOTES TO ACCOUNTS

BSE

Jan 28, 03:59
794.40 +3.10 (+ 0.39 %)
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Prev. Close 791.30
Open Price 791.30
Today's Low / High
785.00
     
796.00
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You can view the entire text of Notes to accounts of the company for the latest year

Market Cap. ( ` in Cr. ) 78299.82 P/BV 3.85 Book Value ( ` ) 206.24
52 Week High/Low ( ` ) 847/607 FV/ML 5/1 P/E(X) 18.22
Book Closure 31/07/2019 EPS ( ` ) 43.59 Div Yield (%) 1.76
Year End :2019-03 

Notes to Accounts

49 Disclosures required by Schedule V of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and Section 186 (4) of the Companies Act, 2013

a. Amount of investments outstanding as at March 31, 2019 include:

Name of the company

Outstanding as at March 31,2019 / March 31, 2018

Maximum amount outstanding during the year

Mahindra Rural Housing Finance LTD

1,000

1,000

Mahindra Happinest Developers Limited

250

250

Mahindra World City Jaipur Limited

-

500

Mahindra Life Space Developers Limited

250

250

Mahindra & Mahindra Financials Services Limited

4,000

4,000

1,000

1,000

HDFC Limited

2,000

4,000

4,000

4,000

Bajaj Finance Limited

4,000

4,000

-

-

b. For other investments and loans refer note 6 and 10 and 48.

50 Employee Stock Option Scheme i. ESOP 2000 &ESOP 2010:

The Company has instituted 'Employee Stock Option Plan 2000' (ESOP 2000) and 'Employee Stock Option Plan 2010' (ESOP 2010) for eligible employees and Directors of the Company and its subsidiaries. The vesting pattern of the schemes has been provided below. The options can be exercised over a period of 5 years from the date of the grant. Each option carries with it the right to purchase one equity share of the Company at the exercise price determined by the Company at the time of grant for ESOP 2000 and exercise price as determined by the Nomination and remuneration Committee for ESOP 2010.

ii. ESOP 2006 & ESOP 2014:

The Company has instituted 'Employee Stock Option Plan 2006' (ESOP 2006) and 'Employee Stock Option Plan 2014' (ESOP 2014) for eligible employees and Directors of the Company and its subsidiaries. In terms of the said plan, the Nomination and Remuneration Committee has granted options to the employees of the Company and its subsidiaries. The maximum exercise period is 7 years from the date of grant for ESOP 2006 and options can be exercised over a period of 5 years from the date of each vesting for ESOP 2014.

The vesting period of the above mentioned 4 ESOP Schemes, namely ESOP 2000, ESOP 2006, ESOP 2010 and ESOP 2014 are as follows:

Vesting percentage of options

Service period from date of grant

ESOP 2000 and ESOP 2010

ESOP 2006

ESOP 2014

12 months

33.33%

10%

15%

24 months

33.33%

15%

20%

36 months

33.33%

20%

30%

48 months

-

25%

35%

60 months

-

30%

-

iii. TML ESOP-B 2013:

Erstwhile Satyam has established a scheme 'Associate Stock Option Plan - B' (ASOP - B) under which 28,925,610 options were available for grant/exercise at the time the Scheme of Amalgamation became effective. Post-merger, these options were adjusted in terms of the approved Scheme of Amalgamation. Each option entitles the holder one equity share of the Company. These options vest over a period of 1 to 4 years from the date of the grant. Upon vesting, employees have 5 years to exercise the options. Post-merger, the name of the ESOP scheme has been changed to 'TML ESOP B2013'.

iv. TML- RSU:

The erstwhile Satyam has established a scheme 'Associate Stock Option Plan - Restricted Stock Units (ASOP- RSUs)'to be administered by the Administrator of the ASOP- RSUs, a committee appointed by the Board of Directors of the erstwhile Satyam in May 2000. Under the scheme, 1,529,412 equity shares (equivalent number of equity shares post-merger) are reserved to be issued to eligible associates at a price to be determined by the Administrator which shall not be less than the face value of the share. These RSUs vest over a period of 1 to 4 years from the date of the grant. The maximum time available to exercise the options upon vesting is five years from the date of each vesting. Post-merger, the name of the ESOP scheme has been changed to TML RSU.

v. ESOP-A:

Erstwhile Satyam had established an ESOP scheme viz., 'Associate Stock Option Plan - A' (ASOP - A) formulated prior to the SEBI Guidelines on ESOP and ESPS issued in 1999. This plan was administered through a Trust viz., Satyam Associates Trust (Satyam Trust). At the time the Scheme of Amalgamation and Arrangement became effective, the Satyam Trust was holding 2,055,320 shares of erstwhile Satyam, which post amalgamation were converted into 241,802 shares of the Company at the approved share exchange ratio and this scheme has been transitioned and renamed as ESOP-A. Satyam Trust grants warrants to the employees of the Company with an exercise price and terms of vesting advised by the Nomination and Remuneration Committee of the Company. Each warrant shall entitle the warrant holder to one equity share. The exercise period is 180 days from the date of each vesting.

vi. Employee Stock Option Scheme - ESOS:

Erstwhile MESL has established Employee Stock Option Scheme (ESOS) - ESOS for which 1,400,000 equity shares were earmarked. ESOS Scheme is administered through a Trust viz., MES Employees Stock Option Trust. The options under this Scheme vest over a period of 1 to 3 years from the date of the grant. Upon vesting, employees have 7 years to exercise the options. As on the effective date of amalgamation, 18,084 options were outstanding under ESOS, which were converted into equivalent 30,144 options of the Company giving effect to approved share exchange ratio, split and bonus.

vii. Details of options granted during the year ended March 31,2019:

ESOP Scheme

Method of Settlement

Number of options granted during the year ended March 31, 2019

Grant date

Weighted average fair value

ESOP 2014

Equity settled Plans

968,000

May 25, 2018

671.01

ESOP 2014

Equity settled Plans

15,000

May 25, 2018

287.24

ESOP 2014

Equity settled Plans

210,000

July 30, 2018

608.20

ESOP 2014

Equity settled Plans

479,000

October 30, 2018

600.06

ESOP 2014

Equity settled Plans

10,000

October 30, 2018

245.32

ESOP 2014

Equity settled Plans

753,000

February 4, 2019

692.89

ESOP 2014

Equity settled Plans

8,000

February 4, 2019

286.19

viii. Details of activity of the ESOP schemes

Movement for the year ended March 31, 2019 and year ended March 31, 2018:

ESOP Scheme

Particulars

Year ended

Outstanding at the beginning of the year

Granted during the year

Forfeited during the year

Lapsed during the year

Exercised during the year

Outstanding at the end of the year

Exercisable at the end of the year

ESOP 2000

Number of options

March 31, 2019

-

-

-

-

-

-

-

ESOP 2000

WAEP*

March 31, 2019

-

-

-

-

-

-

-

ESOP 2000

Number of options

March 31, 2018

470,000

-

-

-

470,000

-

-

ESOP 2000

WAEP*

March 31, 2018

12.24

-

-

-

12.24

-

-

ESOP 2006

Number of options

March 31, 2019

623,900

-

8,400

104,000

360,850

150,650

150,650

ESOP 2006

WAEP*

March 31, 2019

194.81

-

230.50

175.25

190.22

217.30

217.30

ESOP 2006

Number of options

March 31, 2018

1,205,275

-

49,500

78,000

453,875

623,900

504,700

ESOP 2006

WAEP*

March 31, 2018

187.83

-

185.92

158.50

183.49

194.81

185.74

ESOP 2010

Number of options

March 31, 2019

6,668

-

-

-

-

6,668

6,668

ESOP 2010

WAEP*

March 31, 2019

1.01

-

-

-

-

5.00

5.00

ESOP 2010

Number of options

March 31, 2018

23,336

-

-

-

16,668

6,668

6,668

ESOP 2010

WAEP*

March 31, 2018

5.00

-

-

-

5.00

5.00

5.00

TML ESOP B-2013

Number of options

March 31, 2019

3,422,464

-

17,570

48,517

2,128,314

1,228,063

1,228,063

TML ESOP B-2013

WAEP*

March 31, 2019

79.68

-

372.28

220.92

42.62

134.15

134.15

TML ESOP B-2013

Number of options

March 31, 2018

7,360,115

-

63,568

80,444

3,793,639

3,422,464

3,392,464

TML ESOP B-2013

WAEP*

March 31, 2018

58.51

-

423.91

221

29.85

79.68

76.09

TML RSU

Number of options

March 31, 2019

442,100

-

472

2,500

158,504

280,624

280,624

TML RSU

WAEP*

March 31, 2019

5.00

-

5.00

5.00

5.00

5.00

5.00

TML RSU

Number of options

March 31, 2018

910,686

-

10,000

78

458,508

442,100

411,100

TML RSU

WAEP*

March 31, 2018

5.00

-

5.00

5.00

5.00

5.00

5.00

ESOP A

Number of options

March 31, 2019

380,808

-

-

13,056

320,340

47,412

47,412

ESOP A

WAEP*

March 31, 2019

13.72

-

-

30.00

10.65

30.00

30.00

ESOP A

Number of options

March 31, 2018

304,698

248,000

14,112

17,990

139,788

380,808

132,808

ESOP A

WAEP*

March 31, 2018

30.00

5.00

30.00

30.00

30.00

13.72

30.00

ESOP 2014

Number of options

March 31, 2019

13,522,078

2,443,000

785,560

-

980,994

14,198,524

6,039,678

ESOP 2014

WAEP*

March 31, 2019

292.77

13.04

381.02

-

204.52

245.85

450.66

ESOP 2014

Number of options

March 31, 2018

10,655,452

4,890,500

1,578,836

-

445,038

13,522,078

3,880,902

ESOP 2014

WAEP*

March 31, 2018

394.33

77.62

367.33

-

95.83

292.77

504.95

ESOS

Number of options

March 31, 2019

5,252

-

-

-

-

5,252

5,252

ESOS

WAEP*

March 31, 2019

6.00

-

-

-

-

6.00

6.00

ESOS

Number of options

March 31, 2018

20,196

-

-

13,132

1,812

5,252

5,252

ESOS

WAEP*

March 31, 2018

15.07

-

-

11

69.60

6.00

6.00

Total

Number of options

March 31, 2019

18,403,270

2,443,000

812,002

168,073

3,949,002

15,917,193

7,758,347

Total

Number of options

March 31, 2018

20,949,758

5,138,500

1,716,016

189,644

5,779,328

18,403,270

8,333,894

* Weighted average exercise price ix. Average Share price on date of exercise

The weighted average share price for the year over which stock options were exercised was Rs 707.21 (year ended March 31, 2018: Rs 428.75).

x. Information in respect of options outstanding:

ESOP Scheme

Range of Exercise price

As at March 31, 2019

As at March 31, 2018

Number of Options Outstanding

Weighted average remaining life (in Years)*

Number of Options Outstanding

Weighted average remaining life (in Years)*

ESOP 2006

151-300

146,650

0.83

603,900

0.78

ESOP 2006

301-450

4,000

1.37

20,000

2.37

ESOP 2010

5-150

6,668

0

6,668

0

TML ESOP B-2013

5-150

713,828

2.63

2,547,008

3.05

TML ESOP B-2013

151-300

338,171

1.22

620,900

1.79

TML ESOP B-2013

301-450

136,064

2.55

206,556

3.34

TML ESOP B-2013

451-600

40,000

2.84

48,000

3.84

TML RSU

5-150

280,624

2.31

442,100

3.31

ESOP A

5-150

47,412

0

380,808

0.61

ESOP-2014

5-150

7,364,162

6.32

5,726,687

6.66

ESOP-2014

301-450

3,578,200

5.15

4,131,590

6.03

ESOP-2014

451-600

46,000

4.75

41,600

4.33

ESOP-2014

601-750

3,210,162

3.17

3,622,201

4.12

ESOS

5-150

5,252

0

5,252

0

*Weighted average remaining life for options exercised pending allotment as at year end has been disclosed as '0'.

xi. The employee stock compensation cost for the Employee Stock Option Plan 2010, Employee Stock Option Plan 2000, Employee Stock Option Plan- B 2013, ESOP-A, ESOP 2014 and TML-RSU schemes has been computed by reference to the fair value of share options granted and amortized over each vesting period. For the period ended March 31, 2019, the Company has accounted for employee stock compensation cost (equity settled) amounting to Rs 1,091 Million (March 31, 2018: Rs 713 Million). This amount is net of cost of options granted to employees of subsidiaries.

xii. The fair value of each option is estimated on the date of grant using Black-Scholes-Merton model with the following assumptions:

Assumptions

For the year ended March 31, 2019

For the year ended March 31, 2018

Particulars

ESOP 2014

ESOP 2014

ESOP A

Weighted average share price

653

381-599

430

Exercise Price

5-635

5-362

5

Expected Volatility (%)

27-30

27-29

29

Expected Life (in years)

2-6

2-6

3

Expected Dividend (%)

1-2

1.2

1.2

Risk Free Interest Rate (%)

7-8

6-7

6.2

51 Earnings Per Share:

Rs in Million except earninas oer share

Particulars

For the year ended

March 31, 2019

March 31, 2018

Profit after taxation

43,804

39,939

Equity Shares outstanding as at the end of the year (in nos.) #

985,307,673

979,318,628

Weighted average Equity Shares outstanding as at the end of the year (in nos.) #

982,568,498

979,261,979

Add: Dilutive impact of employee stock options

8,473,480

7,365,157

Add: Dilutive impact for Buy Back (refer note 17(vi))

6,062,160

-

Number of Equity Shares used as denominator for calculating Diluted Earnings Per Share

997,104,138

986,627,136

Nominal Value per Equity Share (in Rs)

5.00

5.00

Earnings Per Share (Basic) (in Rs)

44.58

40.79

Earnings Per Share (Diluted) (in Rs)

43.93

40.48

# Includes adjustment for vested options exercisable for little or no consideration and treasury shares held by ESOP trusts.

52. Previous period figures have been regrouped wherever necessary, to correspond with the current period's classification / disclosure.

For B S R &. Co. LLP

For Tech Mahindra Limited

Chartered Accountants

Firm Registration No.101248W/W-100022

Jamil Khatri

Anand G. Mahindra

C. P. Gurnani

Partner

Chairman

Managing Director & CEO

Membership No. 102527

Anupam Puri

M. Damodaran M. Rajyalakshmi Rao

Director

Director Director

V S Parthasarathy

Director

Ravindra Kulkarni

Director

T. N. Manoharan

Director

Ulhas N. Yargop

Mukti Khaire

Director

Director

Manoj Bhat

Anil Khatri

Chief Financial Officer

Company Secretary

Mumbai, India, May 21, 2019

Mumbai, India, May 21

,2019