Growth

for good
2018-19
Annual Report
A resilient nation.
A thriving market.
An aspiring populace.

India’s time is
An inclusive outlook for development o�ers immense opportunity for 3M to partner in
empowering a future ready India. Envisaging growth for all, stretching our aspiration to every
company, every home and every life.
Science plays a critical role in building a resilient future where everyone can thrive. Today,
3M is growing its business in India by unleashing the potential of our science and innovations
that help bring to life the aspirations of India’s people.

Growing with purpose. Growing for good.

In FY 2018-19, four strategic drivers helped 3M break new ground and expand its impact
with customers and in key markets.

Customer Innovation Design-led On ground

at our core for India innovation partnerships
From customer India’s key growth We are taking a Strategic partnerships
scorecards to expanding engines – consumer, proactive approach to with Central and State
relevance of 3M science infrastructure, develop meaningful Government agencies
with our customers, we healthcare, automotive brand experiences for and initiatives are
are committed to drive and transportation are our customers through widening our impact.
innovation with our bene�tting from new design-led innovation.
customers at our core. applications of our
science to improve lives.
now.

1
 Contents
Message from the Chairman 3 Notice to members and route map
to the venue of the AGM 41
Message from Managing Directors 4
Note to the Members 51
3M India Growth Story. FY 2018-19 Highlights 8
Report of the Board of Directors 52
Ten Year Financial Highlights 34
Annexures to Report of the Board of Directors 64
Board of Directors 36
Standalone Independent Auditor’s Report and
Annexures to Independent Auditor's Report 132

Standalone Balance Sheet 140

Standalone statement of Profit and Loss 141 Consolidated statement of Profit and Loss 191

Standalone statement of Changes in Equity 142 Consolidated statement of Changes in Equity 192

Standalone statement of Cash Flow 143 Consolidated statement of Cash Flow 193

Notes to the standalone Financial Statements 145 Notes to the consolidated Financial Statements 195

Consolidated Independent Auditor’s Report and Attendance slip 239

Annexures to Independent Auditor’s Report 185
Proxy form 241
Consolidated Balance Sheet 190

Registered Office: Corporate Office:

Plot Nos. 48-51, Electronics City, Concorde Block, UB City,
Hosur Road, Bengaluru - 560100 24, Vittal Mallya Road,
T: +91 80 2852 0203 Bengaluru - 560001
F: +91 80 2852 0576 T: +91 80 2223 1414
F: +91 80 2223 1450
2
Dear Shareholders, Your company’s priority
market segments such as
It is my privilege to write to
you as the Chairman of 3M
Bharat infrastructure, consumer,
healthcare, automotive and
India Limited and present to
you the Annual Report of your
D. Shah electronics manufacturing
are well aligned to the
Chairman country’s growth sectors
company’s performance and
initiatives for the Financial and initiatives. Your
Year 2018-19. company continued to forge
deeper relationships through
strategic customer-centric
After a strong recovery in early programs and enhanced

“
2018, global economic growth capabilities, with the launch of the
slowed down notably, in the second global Design Center to drive
half of the year ending at 3.0% as design-led innovation.
trade tensions increasingly took a toll
on business confidence, energy
market volatility brought in headwinds Your company remains committed to
and policy uncertainty prevailed 3M India has the highest standards of corporate
governance and excellence with
across many economies.
shown resilience worldwide recognition for its ethical

In FY 2018-19, even as the economy in managing the economic business practices. Structured CSR
initiatives have enabled the company
showed resilience powering through
back-to back reforms such as
conditions with a to enhance its societal impact across
communities in India, through
demonetisation and GST, India's GDP consistent broad-based initiatives such as the
slowed to 7% from 7.2% estimated
earlier. As the country entered an performance during the promotion of girl child education,
road safety awareness and water
election year, the slowdown in
investment activity, currency
FY 2018-19.” conservation programs. Employees’
contributions are harnessed through
volatility, rising non-performing assets volunteering imbibing in them a
along with the agrarian crisis affected higher sense of purpose.
the GDP growth. Despite the
slowdown, World Bank continues to project a bright picture for
India’s growth in FY 2019-20 with a moderate forecast of 7.5%. Your company has grown in performance and stature under the
The year was also marked by purposeful strides made by India dynamic leadership of Debarati Sen who concluded her tenure
to become the 6th largest economy in the world and ascending as Managing Director of 3M India Limited on May 31, 2019. I
to 77th in the Ease of Doing Business ranking. With the formation would like to congratulate her for advancing the company and
of the new government, it is expected that infrastructure enhancing its reputation in the industry. I welcome Ramesh
investments will pick up pace. Ramadurai as he takes over the reins and wish him success in
leading your company into its next phase of growth.

Against this backdrop, your company’s performance continued

to show resilience in managing the economic conditions with a To conclude, I would like to thank you, shareholders, for your
broad-based, market differentiated growth during the FY 2018- unstinted support and confidence in the company. My gratitude
19. It has posted an annual turnover growth of 10.34% on extends to our stakeholders - customers, government bodies,
consolidated basis accompanied by an increase in profitability channel partners and associates for their support and, to all the
of 9.90% on consolidated basis over the previous year. The employees of the company for their contributions. I am grateful
operating margin for the current year was at 19.02% compared for the opportunity to execute my responsibilities as Chairman
to 19.95% for the last year. The performance can be attributed of 3M India Limited and thank the Board of Directors for their
to the company’s management of the product portfolio mix, collaboration and support. I wish the 3M India team the very
driving value through local manufacturing, enhanced best to put in a strong growth performance in FY 2019-20 and
participation and engagement with Government bodies and in the years ahead.
ministries and growth in Tier 2 & 3 cities.
Thank you.

3
 Dear Shareholders, Customers at our Core

It is my privilege to share my In FY 2018-19, we introduced

last message as Managing several initiatives to deepen
Director of 3M India Limited, our understanding of our

Debarati
your company, which I have customers and measure our
been honoured to serve over performance as our
the last three years. Our
journey this fiscal has been
Sen customers would. Notable
being, Sampark, a strategic
Managing Director
both incredibly fulfilling and (up to May 31, 2019) key account management
challenging in many ways and program that helped bring to
I am proud of the resilience life the breadth of our
we have demonstrated as a solutions, technologies and
company in the current science into our customers’

“
economic environment. We have world. We covered over 50 of our
proven our ability to thrive in a key strategic accounts across
VUCA world, against the backdrop sectors with clear line of sight on
of global economic uncertainty and growth opportunities.
domestic market turbulence.
The company has Innovating for Impact
Our growth story reflects our growth sustained its strong
sectors in India – transportation,
infrastructure, consumer, healthcare, growth trajectory with a During FY 2018-19 we introduced
several new products in India,
energy and electronics including sharp focus on improving transforming user experiences and
digital transformation. As we have
said, growth happens at the quality of business, portfolio solving tough challenges for our
customers. Impactful innovations
intersection of demand and policy prioritization, operational introduced in the year included –
and your company has ensured that
strong understanding of the market discipline and commitment • A new product category for home
organization and décor, Command™
and our customers translates into
profitable growth. Even with the
to ethics and compliance.” Hooks taps into the creativity of
global economic slowdown, India people keen to add personal touches
continues to be seen as an attractive to their homes without damaging
investment destination with increasing ease of doing walls.
business and continuity of policy framework. • Our diverse solutions, from high performance adhesives to
safe road furniture were a part of the iconic engineering
marvel, the Statue of Unity project.
You would be pleased to know that during FY 2018-19, your
company delivered market differentiated performance with • Several of our solutions, from signages, variable messaging
an annual turnover growth of 10.34% accompanied by profit signs to weather resistant graphic wraps on trains helped
growth of 9.90% on consolidated basis over the previous tourists find the way at Kumbh Mela 2019.
year. Your company has sustained its strong growth • New products in vehicle air care enabled passengers
trajectory with a sharp focus on improving quality of breathe clean air inside their cars.
business, portfolio prioritisation, operational discipline and ·• We collaborated with State Governments, specifically,
commitment to ethics and compliance. Our performance Karnataka State Government to equip construction workers
was marked by key initiatives that helped us create impact – with safety kits, training and education.
with our customers, in the markets we serve and with our • We introduced an online education platform, 3M
communities. Healthcare Academy, offering a wide array of specialised
courses and certifications for the medical fraternity, especially
nurses.
• Our home care range expanded to include several new
cleaning tools such as bottle brushes addressing local insights.
The brand also took a bold stand to drive gender-neutral
messaging around the theme – Ghar Sabka Kaam Sabka,
which resonated with today’s socially conscious youth.

4
During FY 2018-19, the company completed the acquisition Creating sustainable impact on our communities
of 3M Electro & Communication India Pvt. Ltd. adding to
our capabilities and product portfolio, differentiated With improving performance, our CSR efforts have
solutions covering electrical accessories, electronics dramatically expanded our impact in our communities,
materials and filtration. With research, manufacturing and touching the lives of more than 30,000 beneficiaries. We
warehousing facilities in Pimpri, Pune and 169 employees also announced our prestigious partnership with Project
added to the 3M family, the acquisition enables us to Nanhi Kali empowering 2,000 girl children in rural
participate in sectors such as power, utilities, electronics Maharashtra through education. In addition, our
manufacturing and the burgeoning auto-electrification commitment to environment sustainability goes beyond
market. Last year, we were one of the two component compliance, thinking holistically about how our operations
companies featured at the Global Mobility Summit (MOVE) and products affect our environment. Thanks to the efforts
held in New Delhi and we continue to work with various of our people, we have been able to reduce our water
stakeholders to bring about technical advancement in this consumption by 57%, energy consumption by 28% and
space. waste by 21% respectively per ton of production.

On ground partnerships to create wider impact As I conclude, I would like to appreciate our employees
who have demonstrated tenacity and resilience to deliver
The rise of respiratory diseases in India, led us to form a meaningful growth in this VUCA environment and live by
partnership with the Chest Research Foundation to create the highest standards of ethics and compliance.
awareness and train doctors on chronic respiratory diseases
caused by sustained air pollution exposure. I have also been honoured to have had the opportunity to
Strategic partnerships with both Central and State work with a high caliber Board led by our Chairman of the
Governments have expanded our participation in key Board, Mr. Bharat Shah and our capable independent
national initiatives. We signed an MOU with the Bhopal directors and our executive and non- executive directors.
Smart City Development Corporation Ltd. (BSCDCL) to Thank you for your encouragement, guidance and support.
support the B-Nest Incubation Center for start-ups and My best wishes to Ramesh Ramadurai as he takes over as
young entrepreneurs with mentorship. your company’s new Managing Director.

Design-led innovation Most importantly my gratitude to you, our shareholders for

your trust and confidence in our company and me and for
During FY 2018-19, we further enhanced our capabilities helping me during my journey leading this incredible
and level of customer engagement through the launch of enterprise.
3M Design Center, in Bengaluru. The fourth such 3M
Design Center in the world, where design inspires Thank you.
innovation and meaningful brand experiences for
customers. Our work with Indian Railways especially, with
marquee trains such as, Train 18 rolling out last year with
3M technology as well as revamped exteriors and interiors
of the New Delhi railway station are proof points of
design-led innovation enhancing passenger experience.

Beacon of corporate excellence, ethics and integrity

Our accomplishments through the year have been

recognized by the industry, national publications and
several of our customers. Your company featured amongst
the Outlook Magazine’s Outperformers List and Forbes
Super 50 Companies in India. We received industry level
recognition for manufacturing excellence and for our
growing leadership in the Car Care business. We are also
proud of our sixth consecutive recognition by Ethisphere® as
the World’s Most Ethical Company, a testimony to our
unwavering commitment to ethical business.

5
 Dear Shareholders,
Ramesh I am committed to
Ramadurai build on the success
and impact we have
I am honoured to take Managing Director achieved and drive a
office as the new June 1, 2019 onwards
Managing Director for purposeful path forward.
Our focus will be stronger
3M India Limited and look than ever to be more
forward to leading your relevant to the growing

“
company. aspirations of Indian
consumers and drive value
We are optimistic about your through our differentiated
company’s future in India. The solutions, global science
economy is driven by domestic
growth which serves very well
I am committed to expertise and local
manufacturing.
for our diverse product build on the Your company has shown
portfolio. Your company has a
strong history of building
success and impact we itself to be adaptive and
resilient against the backdrop
sustainable and differentiated have achieved and drive a of a rapidly changing
businesses, based on our deep economic environment,
customer orientation and the purposeful path forward.” attributes which will continue
several new-to-the-world to serve us well in the years
innovations we have introduced ahead. We have an energized
in the country. Our recent and engaged workforce
successes have come from identifying new opportunities committed to uphold the values of the company. Above
for growth and pursuing new business models with, all, we will continue in our endeavor to create positive
expanded participation in several sectors of the economy. impact in our communities, improve lives and support
Government investment and initiatives have thrown up India’s progress.
new segments and the increased digitization of the
economy has brought in new value chains. With this
accelerated pace of change in our external environment, Thank you shareholders, for your continued confidence in
our priority is to transform our processes and go-to- the company. I look forward to working with our
market models to stay relevant and continue to attract the esteemed Board of Directors, who bring with them rich
best of talent. and diverse experience. We stay committed to deliver on
our global vision of
3M Technology Advancing Every Company
I would like to thank my predecessor, Debarati Sen for the
strong performance for the year under review and for her 3M Products Enhancing Every Home
leadership over the past three years of her tenure. 3M Innovation Improving Every Life

Thank you.

6
7
 2018-19 Highlights
Customer
at our core

Sampark Initiative
In FY 2018-19, we rallied our company and our people
around a single-minded purpose – keeping our customers
at our core. A company-wide initiative that emerged from
collaborative employee effort was Sampark, a strategic
account engagement program to drive growth with our
strategic key accounts across market sectors.

Using principles of Lean Six Sigma and constructing

journey maps for each of our key accounts, we created an
efficient, replicable, “plug-and-play” model to showcase
3M’s diverse solutions. This was ably supported by 3M
experts who brought to life the possibilities of 3M science.

This flexible model helped us respond to customer

enquiries with rapid ease and gather crucial insights which
could be converted into opportunities.

The program saw significant addition to our brand value

with our customers, enhanced our penetration with several
of our strategic key accounts and opened up opportunities
for joint developments of new technologies.

8
How did we move from transactional relationships to be the ones who receive
the first phone call when our customers have a mission critical need? Thinking
with and like the customer has enabled 3M to empower our customers’ quest
to solve challenges in the markets they serve.

Forging deeper
customer
connections by
bringing 3M
science to life

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 2018-19 Highlights
Innovating
for India

Bridging the ancient and the future

Varanasi Smart City Branding &
Beautification

Re-branding Varanasi into a Smart City with a

unique persona, meant re-imagining how public
spaces could tell a story. 3M positioned its non-PVC
green graphic film as a replacement for traditional
hand painting on city infrastructure. The film’s
diverse application meant it could be wrapped
around structures such as city water tanks, totem
and high mast poles apart from the walls and
buildings. Added to that, a winning design concept,
captured the cultural ethos of the city, with the
ability to stand the test of time. This model of
engagement has enabled 3M to participate in other
city branding initiatives to build citizen pride.

10
India’s bold vision for progress, has unlocked opportunities for 3M to create
impact across the country’s growth sectors. FY 2018-19 saw 3M enter new
market segments, solve critical challenges in the execution of large public
infrastructure initiatives and empower professionals across industries with
our technologies and product portfolio.

Mission Iron Man

A unified 3M offering from bonding to road safety
to build India’s iconic statue.

The construction of this engineering marvel was no mean

feat. Approximately 7,000 bronze panels that form the
cladding of the world’s tallest statue were RFID tagged to
enable assembly and erection. Each of the tags were held by
a long lasting, non-corrosive 3M adhesive solution which
assisted builders in erecting this colossal statue. As a major
tourist attraction, the roads leading up to the Statue of Unity
were dotted with 3M’s road safety solutions while 3M non
PVC graphics were used to display stories in the museum
providing a world-class experience to visitors.

Paths to a Spiritual Journey

Enhancing Kumbh Mela as the ultimate
spiritual experience

A record number of tourists visited Kumbh Mela 2019. The

scale of crowd management and surveillance required live
information to be communicated to visitors. 3M’s intelligent
Variable Messaging Signs displayed real-time information
assisting people to the Mela areas, while way finding signage
enhanced the overall experience. The special trains
introduced to ferry people to Allahabad were wrapped in 3M
weather resistant graphic films enhancing the visual appeal
of the world’s largest religious gathering.

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 2018-19 Highlights
Innovating
for India

Commanding weight
in the Home Improvement market
Command™ Hooks

A young India is on the move, preferring to rent spaces and yet claim
their personal identity. Nails and hammers didn't offer the flexibility and
convenience to display memories of togetherness, festive spirit or a
little one's first smiley drawing. A new market opportunity emerged for
3M to introduce Command™ hooks for easy and practical home décor
and organisation.

Command™ Hooks’ effortless application, ability to take load and ease

of removal have established it as a category leader in a short time.
Command’s value proposition appealed to the young, net-savvy
consumers, willing to try new DIY solutions.

Now available in more than 150 stores across India, this launch gave
3M its first entry into the Indian home improvement market.

12
Easy home cleaning for all Breathing easy inside cars
Scotch-Brite Broom, Bottle Brush and 3M™ AC Evaporator Cleaner and
®

Silver Sparks Scrub Pads 3M™ Air Refresher

Over the years, Scotch-Brite®, one of 3M’s trusted A fast growing automobile market and a heavily
brands in India has emerged as a category leader in polluted environment do not make a healthy
the home cleaning market. In FY 2018-19, the combination. Two new offerings – 3M™ AC
brand stepped up in a big way, by taking a social Evaporator Cleaner and 3M™ Air Refresher – are
stand with gender-neutral messaging in its redefining the vehicle air treatments segment.
advertisements. “Ghar Sabka Kaam Sabka” was a
national campaign that questioned traditional roles Designed for quick turnaround and effective
at home calling people to roll up their sleeves and cleaning and disinfection, these products are helping
share the responsibility. deliver germ-free air and fresh smelling cabins.

Scotch-Brite® also expanded its range with new

cleaning tools like Scotch-Brite® Broom, which
reduces the effort required for sweeping through
an ergonomic design, Scotch-Brite® Bottle Brush
which keeps bottles clean and scratch free and
Scotch-Brite® Silver Sparks, which reassures users
about the cleaning potency with visual silver
speckles.

13
 2018-19 Highlights
Innovating
for India

Road safety that lasts

3M™ Raised Pavement Markers

Cramped roads with low visibility require solutions that

reliably guide motorists to safety. Over the years, 3M’s Raised
Pavement Markers have been used for lane and pavement
marking, effectively alerting road users. Tough weather and
road conditions do take their toll in the long term, so the
design of the product was enhanced to take on heavier
vehicle load and reduce the impact of tyres.

The next generation Raised Pavement Markers incorporated

several new enhancements - a novel honeycomb weld that
lends better joint strength, offers even load distribution,
reduces tyre impact on the lens along with robust anchoring
to the road surface.

14
Ensuring workers Improving professional
return home safe expertise among nurses
Customised safety kits and education 3M SM Healthcare Academy

Ensuring India’s ambitious infrastructure projects Nurses in India work long hours in tough conditions
stay on track means safeguarding a workforce that leaving little room for personal learning and
performs under difficult conditions. 3M participated development. Yet, the demand for specialized care
in the safety and welfare initiative by the continues to grow. To address the lacuna of
Government of Karnataka for their construction trainers and educators in hospitals, 3M introduced
workers by providing customised safety kits which an innovative model of online accredited courses
included sight, hearing, and head protection for nurses through the 3M Healthcare Academy .
personal safety devices.
With e-learning options like video modules, mobile
In addition, more than 50,000 workers across the applications and webinars, nurses get access to
state underwent specialised training by 3M safety global content and healthcare educators. The
experts. initiative has expanded reach to nurses in Tier 2 & 3
cities, while paving the way for a wider acceptance
of 3M’s healthcare solutions in several hospitals.

15
 2018-19 Highlights
Humanising technology
through Design

3M Design India
Momentum for Design and design thinking in India is growing, built on
professionalism and greater focus on customer value. In FY 2018-19, 3M
Design Center for India was opened at our Electronics City campus in
Bengaluru to drive deeper engagement and value for our customers.

The India Design Center is one of 5 global design hubs set up to accelerate
the growth of design-led innovation. The center houses a team of designers
with diverse creative backgrounds to engage with partners in business and
academia. With its open design space, proximity to our labs and
opportunities to experience 3M’s materials and technologies, the center
encourages early design involvement to strengthen customer engagement.

The mission of collaborative creativity is driven through platforms such as

the 3M Design Summit for design thought leaders and Design Meets Design
which encourages cross-sharing between designers in peer companies.
Several new opportunities have emerged which offer scope for 3M to
provide value with Design as a key differentiator.

16
Design thinking that is inspired by challenges posed by the market and sharp
local insight is re-shaping the way we develop newer, and sustainable
solutions that delight customers, through the power of collaborative creativity.

Moving a nation
with style and efficiency
3M’s collaboration with the Indian
Railways is an example of design leading
innovation and transforming experiences
for end consumers. From technical
applications to the aesthetic, 3M science
and design solutions played a pivotal role
in re-imagining coach building and
design.

This collaboration has led to the launch

of several new trains carrying never-
before-seen graphics, ushering in a new
look for the Indian Railways. 3M
materials are also helping to reduce
energy consumption in AC coaches and
being deployed to build dry toilets inside
trains while our weather resistant wraps
on train bodies offer a vibrant branding
platform.

The impact of design thinking has

extended to public spaces such as city
railway stations. The New Delhi Railway
station has seen a makeover with 3M
graphic materials bringing in a vibrant,
new look with attractive design.

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 2018-19 Highlights
On ground
partnerships
Collaboration to help India breathe easy
MOU with Chest
Research Foundation
Constant exposure to air and industrial pollution has given rise
to obstructive airways diseases such as, Chronic Obstructive
Pulmonary Disease (COPD) and asthma. Most cases of asthma
and COPD remain undiagnosed due to the lack of credible
research, infrastructure and skills for treatment. Educating the
medical fraternity and citizens can enhance early and accurate
diagnosis, and proper treatment.

In FY 2018-19, 3M announced a partnership with the Chest

Research Foundation (CRF) to build awareness through joint
research. The collaboration also includes the education of over
3,500 pulmonologists on the management and prevention of
chronic occupational lung diseases through training,
conferences and seminars.

18
National initiatives such as Make in India, Start-up India and Skills India
have opened up opportunities for 3M to participate to create wider
societal impact through our expertise and solutions.

Mentoring Budding Entrepreneurs

MOU with B-Nest, Bhopal Smart City
Development Corporation Limited (BSCDCL)

Government of India’s Smart Cities and Start-up India initiatives have

provided the much-needed boost to the emerging start-up ecosystem in
India. Several State Government supported incubation centers are
partnering with the private sector in areas of knowledge transfer,
technology assistance and mentorship. 3M continued its commitment to
India’s start-up initiative by partnering with the Bhopal Smart City
Development Corporation’s B-Nest Incubation Center.

Budding tech start-ups at B-Nest working on technologies and solutions

for Smart Cities are gaining from pro-bono mentoring sessions with 3M
experts, campus visits and access to networks as they build their
entrepreneurial dream.

19
 2018-19 Highlights
3M India’s foray into power
and electronics segment

With the acquisition, we have added a new

manufacturing facility based in Pimpri, Pune.
The plant is equipped with a full-fledged
research facility, manufacturing and
warehousing space spread over 19,000 sqm and
an employee strength of 169 employees.

Differentiated technology platforms applied at

the plant include - cable jointing, heat shrink &
cold shrink, compounding, extrusion, expansion,
rubber and plastic moulding, kitting, electrical
and electronics assembly.

These technology applications enable the

company to serve customers in sectors like
power, telecom, electronics, pharma, infrastructure and construction. The facility is a designated “Center
of Excellence” for the Heat Shrink platform, which is applied to solutions for power utilities in cabling and
termination of power lines.

20
India is powering its way into the future with an electrical grid that’s
connecting more lives and gearing up for electrified mobility. In FY 2018-
19, 3M India Limited acquired a hundred percent stake in 3M Electro &
Communication Private Limited (3M E&C), a company with expertise in
electricals and electronics, adding to 3M’s capability and product portfolio.

2018 - 2019 highlights

• 3M entered the high voltage segment with products like
jointing and termination kits that enable reliable power
installations. The portfolio was locally manufactured at the
Pimpri plant with in-house technical knowhow.
• A dedicated Automotive Electrification (AE) unit was set
up to cater to emerging trends in the automobile industry.
Tie-ups with Automobile OEMs, battery manufacturers,
regulatory bodies and design houses were established to
follow an integrated approach towards developing this
technology.
• 3M also participated in the Global MOVE Summit
targeting the Auto Electrification segment and was one of
the two component companies invited to showcase
technologies.

Products & solutions

Electrical Accessories Electronics Materials Filtration Solutions

for Power Sector
• Power cable accessories for • Electronic coatings • Industrial filtration systems
various voltage classes • Engineering fluids for immersion • RO & Drinking Water Systems
• Electrical and electronic cooling • Residential Water Purification
specialty insulating tapes, tapes • Connectors, cables, cable Systems
for Maintenance, Repair & assemblies, sockets and
Operations (MRO) embedded capacitance
• Underground asset tracking materials for electronic
using locating & marking manufacturing
products

21
 How we work
Applying Science
to improve every life
Our Vision 3M Value Model
3M continues to be inspired and motivated 3M’s actions are guided by our vision
by our corporate vision, which guides our and values of uncompromising honesty
work every day: and integrity.

3M Technology Our Value Model makes us unique

Advancing Every Company among companies and differentiates us
3M Products in the marketplace. This Value Model
Enhancing Every Home links our vision, our fundamental
3M Innovation strengths, the priorities we’re driving,
Improving Every Life and our values as a company.

Our vision is aspirational and drives us as

we look into the future, serving as a daily
reminder of what the 3M brand stands for.

22
A sense of purpose is at the heart of how we approach every business, every
idea, every product, every community, and every life we touch. A commitment
to ‘improve every life’ – that's our promise to the world we live and work in.

3M Value Model

Sustainability framework

Science for Circular Science for Climate Science for Community

Design solutions that do more Innovate to decarbonize Create a more positive
with less material, advancing a industry, accelerate global world through science and
global circular economy. climate solutions and improve inspire people to join us.
our environmental footprint.

These priority areas build off the strength of our existing 2025 Sustainability Goals as we apply
science to improve every life. They also guide business decisions and strategy, as well as, how we
focus our efforts for local and global community impact.

23
 How we work
Global challenges
Our commitment

Challenges Our Action

Raw materials 21% reduction

As more resources are consumed
by an ever-growing population, it
of waste
(Kg/MT of production)
is imperative that product design Recycling our waste to fuel
and manufacturing processes At our plants, we have been working
consider the ecological impact to reduce waste at the source. Our
during life and after end-of-life. waste from manufacturing processes
3M’s edge begins with our well is being used as alternate fuel by our
established safe ecological associates in the cement industry. The
practices. waste is co-processed and doesn't
leave a footprint. This initiative has
helped us reduce our carbon footprint
by 400 metric tonnes of CO2.

Water 57% reduction

Cities without water, parched fields –
this stark reality is already here. Our
of water
(KL/ MT of production)
responsibility begins at our plants -
from the way we save this scarce Reduce and recycle
resource, to stringent manufacturing We monitor water usage with meters and
processes to reduce consumption. pressure gauges, and take all measures
to prevent water leakage. Treated waste
water is reused in our plants.

Energy & climate 28% reduction

Climate change is here to stay unless
we drastically alter consumption and
of energy
(MMTU/ MT of production)
adopt renewable alternate sources to
power our needs and answer those of
our customers.
17% increase
in renewable energy share
Most of our energy needs at our
plants are powered by renewable
energy sources.

24
As a company rooted in scientific exploration and with the belief that every
problem has a solution, we are applying our technological expertise to
solve some of the world’s biggest challenges on raw materials, water,
energy and climate and health and safety.

Health & safety

In an age when the Government, corporations and consumers are laying an increasing emphasis on safety,
we are proud to say that 3M has been a safety pioneer for decades. With entire divisions and technologies
invested in the business of safety, 3M is equipped to deliver solutions dedicated to human health,
protection, security and safety.

We believe safety first begins at home, protecting our 3M’s leadership in safety extends to our communities.
key asset, the 3M employee. All three manufacturing The Safety-on-Wheels, Audhyogik Suraksha Rath
plants have health and safety management systems initiative launched in partnership with the Ministry of
certified to OHSAS 18001: 2007. 3M Corporation has Labour & Employment and DGFASLI has been expanding
recognised all of our manufacturing facilities with the its footprint across industrial clusters in the country. Over
highest award for safety excellence – The CEO Safety the year under review, our safety experts covered more
Award. than one lakh workers across industries through training
and education programs.
In FY 2018-19, two of our facilities – Ranjangaon and
Electronics city, were conferred with this global Our safety message also reached Government schools
recognition. where some of our employees conducted awareness
sessions on road safety along with local traffic police
Impact personnel.
Zero Lost Time Accidents
Impact
Zero Level 2 Fires & Spills
1 Lakh plus safety professionals reached
through the Audhyogik Suraksha Rath
program

25
 How we work
Helping our customers
meet their sustainability goals

Naturally brilliant
The need to light up spaces has exponentially increased with commercial and other
spaces being lit up even during the day. Pioneering film technology in 3M™ Daylight
Redirecting Film is revolutionizing the way spaces are being lit up. Without the need for
extra installations, special fixtures or cleaning, this film, when applied on existing
windows, can reflect natural light up to 40 feet into interior spaces. This film reduces
glare, increases occupants’ well-being and lowers energy bills by up to 52%.

26
Our customers’ challenges are our challenges. That’s why we are committed to
partnering with customers to identify and collaborate on solutions to help them
address their goals.

Cooler data for the world Sustainable rail travel

As data rules our lives more than ever before, the With new trains being rolled out, more rail
installations that store and transmit it are carriages demand long-term, corrosion protection
consuming precious energy. that does not damage the environment. 3M’s
expertise in VOC free solutions, led to the
Our line of non-conductive, sustainable 3M™ development of Scotchkote™ waterborne epoxy
Novec™ Engineered Fluids are ideal for immersion coatings, extensively used for the protection of rail
cooling in data centers. As a result, energy use (and cars and components. Being water based, these
costs) can be slashed by up to 97% while shrinking coatings reduce VOC emission during application
data center size and enabling optimal performance. and in their lifetime, delivering reliable protection
and leaving a greener footprint.

Adding warmth to patient care

Increased life expectancy is aided by better patient
care. Our experience showed that unintended
hypothermia during anaesthesia resulted in longer
hospital stays, increased wound infection and even
death. 3M™ Patient Warming systems use forced-
air to assist healthcare professionals deliver
superior treatment without threatening
hypothermic conditions.

27
 How we work
People &
Culture

A culture that celebrates learning everyday

In FY 2018-19, we launched new programs
to strengthen our development framework
that animates our ambition of learning and
development for all. For our people
leaders, we put in place a workshop series
called ‘India People Leader Journeys’ with
a curriculum for supervisors based on their
roles and experience levels (New Leaders,
Evolving Leaders and Experienced leaders)
to better equip them to lead people in
today's VUCA environment.
A culture of continuous learning was brought in
“Arts for Inspiration” was an initiative to
with the “MasterClass” series, which leveraged in-
help our leaders learn from excellence in
house expertise to sharpen skills on topics like
diverse fields. Speakers included path
finance, design thinking and business storytelling.
breaking artists like Arundhati Nag and
Malavika Sarukkai.
We also continued to invest in our global e-learning
ecosystem, ‘DevelopU’ which puts learning in the
hands of employees with customized virtual
learning modules in short bytes.

28
Our people are our best ambassadors, representing a culture that respects
every individual and inspires a sense of purpose. In FY 2018-19, 3M
continued to foster a strong culture of learning across roles and locations
with several people-focused initiatives.

Listening to Driving impact From the floor

diverse voices with purpose to our customers
‘Be respectful’ - one of our key tenets Solving the world’s needs often
Factory shop floor employees feeling
defines the way we interact with requires inspired insight from
disjointed with the corporate vision is
every stakeholder from employees to committed professionals with relevant
often a challenge faced by
vendors. Our open culture and experience. The “3M Impact” initiative
manufacturing companies.
communication has gained traction is a global pro-bono program that
through two company-wide utilizes special skill sets of 3Mers to
To bring togetherness and establish
initiatives: work on areas aligned to our CSR
our technical associates as a pivot in
focus areas and the UN Sustainable
the bigger picture of growth, we
“BetweenUs”, an interactive face-to- Development Goals.
initiated “Associates Contributing
face session with the Managing
Together” (ACT), a program to build
Director and top management brings Teams of 3Mers spend four weeks
learning agility and cross-line
together 3Mers from all branches and with various stakeholders developing
collaboration for customer wins.
plants to discuss company direction solutions for social and environmental
Focused Town Hall sessions with the
and priorities. causes in markets with high social
company leadership have furthered
needs. Through this program, 3Mers
their understanding of the corporate
“Dialogue with MD” was a face-to- from India have contributed to causes
vision.
face session with the Managing around the world and their shared
Director to share and discuss the experiences enhance their personal
unique professional challenges and professional development.
women face. This helped address
concerns and develop initiatives to
advance women’s leadership in the
company.

29
 How we impact
Sustainable impact
on our communities
Education
Empowering the
girl child
Educating the girl child is an urgent
priority to ensure greater participation of
women in the workforce. 3M responded
to this cause with two initiatives in FY
2018-19 to reduce the drop out of girls
from schools.

Our partnership with Project Nanhi Kali,

which is jointly managed by K.C.
Mahindra Trust and Naandi Foundation,
sponsors the education of 2000 first
generation learners in rural Maharashtra.
This after-school program run at
academic support centers in
Government schools, helps build the
foundation in subjects like Maths,
English and the local language among
the girl students. Tablets with pre-
loaded audio visual content are
innovative ways in which learning is
made interesting.

In Kolkata, 3M supported the

construction of a new residential block
to provide a safe haven for 100 girl
students at the Parivaar Education
Society to continue their education.

30
As we grow, our social investments have increased through scalable
partnerships to touch many more lives of the underprivileged sections of
our society.

Born Learning Program to Giving wings to India’s young

transform Anganwadis scientists and social innovators

Our longest serving program, the Born Learning The 3M-CII Young Innovators Challenge Awards
initiative in partnership with United Way of Program in partnership with the Confederation of
Bengaluru works towards the holistic development Indian Industry (CII) completed five years of
of children, below the age of 6 years, addressing supporting innovators to advance their ideas and
learning, nutrition and healthcare. prototypes. In FY 2018-19, the Challenge
recognized 7 breakthrough early stage ideas with
The program has scaled up to transform grants and access to professional networks.
Anganwadis into safe, child-friendly learning
centers in 9 cities benefitting 18,300 children. This A new category, launched to promote rural
systemic change is led by an active community of innovations, enriched the Challenge with promising
mothers and Anganwadi teachers who play pivotal ideas to address the needs of rural communities.
roles in helping these children make a positive
transition to formal learning.

31
 How we impact
Sustainable impact
on our communities
Environment

Rejuvenating
our lakes
Bengaluru is waking up to the threat of rapidly depleting water bodies
especially the city's lakes. 3M partnered with United Way of
Bengaluru’s “Wake the lake” campaign to revive Lake Singasandra, near
Electronics city. Continuous intervention with infrastructure
improvements has significantly increased green cover with the revival
of aquatic and bird life. Over 5,000 bio-diverse saplings have been
planted in the lake’s vicinity. Residents around the lake have been
drafted into a lake community that organises local festivals and tree
planting drives that ensure ownership.

Helping our farmers

conserve water
Inadequate rain and water scarcity have affected the lives of
agricultural communities in water stressed areas in Latur district.
Towards this, 3M contributed to the construction of check dams
which can harness and store rainwater to help farming communities.
The 2nd year of our intervention has resulted in the desilting, widening
of river tributaries and tank nalla bunds (dams) being built at 7 sites in
4 villages.

32
Community

Healthcare for the Nurturing young Rebuilding lives

last mile change agents for and hope
road safety
With increasing pressure on We need to build empathy and When Kerala and the Kodagu
healthcare systems, a skilled understanding of road safety region of Karnataka were
workforce is key to providing hazards and challenges among the devastated by floods last year,
better patient care. 3M supported young, so they grow up to be 3M responded with a
the Pahal Project with other responsible drivers and road users. rehabilitation program to rebuild
partners, to skill 400 women This premise inspired 3M’s Young Anganwadi centers and
community health workers who Change Agents for Road Safety Government schools to enable
play a vital role in promoting good program, launched in select children to return to school.
health practices, especially at the schools in Pune, to introduce a
last mile. new model for road safety Affected Anganwadi centres at
education. Aluva Block (Ernakulam) and
3M contributed from its vast Government schools in Kodagu
expertise in infection control Through a combination of hands- district have been brought back
towards the curriculum, content on workshops, road behaviour to full operation after extensive
and delivery of the program. Our observation and online modules, repair, plumbing and electrical
faculty delivered training in students were encouraged to work.
districts across UP and Rajasthan. visualize ideal safe zones and
The program is scaling up to cover suggest road safety improvements
more states including Odisha and around their school. The
Assam. observations have resulted in safe
school zone designs which 3M
seeks to bring to life.

33
17.51
 35,000 32,286
31,027
30,000
Profit After Tax (PAT) 23,832
2,80,876 25,000 ( in Lakhs)
3,00,000 2,58,040
Gross Sales 2,45,785 19,417
2,50,000 2,22,376 20,000
( in Lakhs)
2,00,000 1,81,809 1,92,790 15,000 10,834
1,65,250
1,47,123 9,881
1,50,000 1,23,489 9,284
1,11,740 10,000
5,745 6,477
1,00,000 78,008 5,227 4,299
5,000
50,000
0
2008 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16@ 2016-17@ 2017-18@ 2018-19@ 2008 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16@ 2016-17@ 2017-18@ 2018-19@

1,80,000 1,84,827
60,000 54,043 1,60,000 1,52,540
54,000 52,343
Profit Before Depreciation, Interest & Tax 1,40,000
48,000 1,21,513
41,824 1,20,000 Reserves & Surplus
36,000 (PBITDA) 35,428 ( in Lakhs) 97,681
( in Lakhs) 1,00,000
30,000 79,645
80,000 68,816
24,000 21,759 64,517
59,291
60,000 52,813
18,000 15,825 16,644 42,933
12,632 12,101 13,084 33,649
12,000 9,862 40,000

6,000 20,000

2008 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16@ 2016-17@ 2017-18@ 2018-19@ 2008 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16@ 2016-17@ 2017-18@ 2018-19@

60,000
2,00,000 1,85,953
49,746 1,80,000
50,000 47,968
1,60,000 1,53,666

40,000 Profit Before Tax (PBT) 36,922 1,40,000

( in Lakhs) 1,22,638
30,310 1,20,000 Net Worth
30,000 ( in Lakhs) 98,807
1,00,000
80,772
80,000 69,943
60,417 65,644
20,000 16,456 53,940
14,087 14,806 60,000
44,059
9,102 9,611 40,000 34,776
10,000 7,520 6,907
20,000

2008 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16@ 2016-17@ 2017-18@ 2018-19@ 2008 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16@ 2016-17@ 2017-18@ 2018-19@

35
 Board of
Directors
Key Managerial Personnel Corporate Social Responsibility Committee
Ms. Mamta Janak Gore Chief Financial Officer Mr. Bharat D Shah Chairman
Mr. V. Srinivasan Company Secretary and Ms. Debarati Sen Member
Compliance Officer Mr. B.V. Shankaranarayana Rao Member
Mr. Ramesh Ramadurai Member
Audit Committee
Mr. Biren Gabhawala Chairman Nomination and Remuneration Committee
Mr. Bharat D Shah Member Mr. Biren Gabhawala Chairman
Ms. Radhika Rajan Member Mr. Albert C Wang Member
Mr. Jongho Lee Member (up to August 21, 2018)
Mr. Bharat D Shah Member
Stakeholders Relationship Committee Mr. Amit Laroya Member
Mr. Bharat D Shah Chairman Ms. Sadhana Kaul Member
Mr. Biren Gabhawala Member (from October 31, 2018)
Ms. Debarati Sen Member
(up to May 31, 2019) Risk Management Committee (from April 1, 2019)
Ms. Radhika Rajan Member
Mr. Ramesh Ramadurai Member Mr. Biren Gabhawala Chairman
(from June 1, 2019) Mr. Bharat D Shah Member
Ms. Radhika Rajan Member
Bankers Ms. Debarati Sen Member
BNP Paribas (up to May 31, 2019)
Citibank N.A Mr. B.V. Shankaranarayana Rao Member
Deutsche Bank AG Ms. Sadhana Kaul Member
HDFC Bank Limited Mr. Ramesh Ramadurai Member
ICICI Bank Limited (from June 1, 2019)
State Bank of India
The Hong Kong and Shanghai Banking Corporation Limited
Listing on Stock Exchanges
National Stock Exchange of India Limited (NSE)
Auditors
(Code –3MINDIA)
Messrs. B S R & Co. LLP
BSE Limited (BSE) (Code - 523395)
Chartered Accountants
Maruthi Info-Tech Centre,
International Securities Identification Number (ISIN):
11-12/1, Inner Ring Road,
INE470A01017
Koramangala, Bengaluru - 560071
Corporate Identification Number (CIN):
Registrar & Transfer Agent
L31300KA1987PLC013543
Karvy Fintech Private Limited
(formerly Karvy Computershare Private Limited)
Website:
Karvy Selenium Tower-B,
www.3m.com/in
Plot Nos. 31 & 32, Financial District,
Gachibowli, Nanakramguda,
Address for correspondence:
Serilingampally, Hyderabad - 500032
Corporate Office,
Concorde Block, UB City,
24, Vittal Mallya Road,
Bengaluru - 560001

36
 Bharat D. Shah Debarati Sen Ramesh Ramadurai
Chairman, Non-Executive Managing Director (up to May 31, 2019) Non-Executive Director (up to May 31, 2019)
Independent Director Non-Executive Director (from June 1, 2019) Managing Director (from June 1, 2019)

Radhika Rajan Biren Gabhawala B. V. Shankaranarayana Rao

Non-Executive Non-Executive Whole-time Director
Independent Director Independent Director

Jongho Lee Amit Laroya Sadhana Kaul

Non-Executive Director Non-Executive Director Non-Executive Director
(from October 31, 2018)

37
 Awards &
Achievements
Business Performance and Leadership

Forbes India’s Super 50 Outlook Business Outperformers’ Franchisor of the Year Award –
Companies of 2017 list of high performing companies Consumer Services, 2018
Forbes India Outlook Business Franchise Awards
2nd successive year for consistent 3M Car Care
stock return over sensex.

Manufacturing Excellence Lean & Kaizen Safety Leadership

Gold Award for Manufacturing Lean Six Sigma Excellence Certi cate of Merit
Excellence Recognised at the CII 12th National National Safety Council
Frost & Sullivan Six Sigma Competition 3M Ranjangaon & Pimpri Plants
3M Ranjangaon Plant

Women’s Leadership

Business Leadership among Women

Recognised at the Future Women
Leader Summit & Awards 2018

38
39
40
 3M INDIA LIMITED
CIN: L31300KA1987PLC013543
Registered Office: Plot Nos. 48-51, Electronic City, Hosur Road, Bengaluru – 560100
Phone: 080-22231414, Fax: 080-2223 1450, email id: investorhelpdesk.in@mmm.com, website: www. 3m.com/in

NOTICE TO MEMBERS
NOTICE is hereby given that the Thirty Second (32 ) Annual General Meeting of the Company will be held at 11.00 A.M. on Wednesday,
nd

the 14th August, 2019 at Trinity Hall, Taj MG Road, 41/3, Mahatma Gandhi Road, Bengaluru – 560 001, to transact the following business:

ORDINARY BUSINESS:

Adoption of Financial Statements (Standalone and Consolidated) for the financial year ended March 31, 2019.
1. To consider and, if thought fit, to pass, the following Resolutions as an Ordinary Resolution:
(a) “RESOLVED THAT the Audited Standalone Financial Statements of the Company for the financial year ended March 31,
2019, together with the Auditors’ Report thereon and the Board’s Report including Secretarial Audit Report be and are
hereby received, considered and adopted.”
(b) “RESOLVED THAT the Audited Consolidated Financial Statements of the Company for the financial year ended March 31,
2019, together with the Auditors’ Report thereon be and are hereby received, considered and adopted.”

Re-appointment of Mr. Jongho Lee (holding DIN: 06720950), who retires by rotation.
2. To consider and, if thought fit, to pass, the following Resolution as an Ordinary Resolution:
“RESOLVED THAT Mr. Jongho Lee (holding DIN-06720950), Director, who retires by rotation at this Annual General Meeting, and
being eligible for re-appointment, be and is hereby re-appointed as a Director of the Company.”

SPECIAL BUSINESS:
Appointment of Mr. Biren Gabhawala (holding DIN: 03091772) as a Director of the Company.
3. To consider and, if thought fit, to pass, the following Resolution as an Ordinary Resolution:
“RESOLVED THAT Mr. Biren Gabhawala (holding DIN:03091772), who was appointed as an Additional Director of the Company
from August 5, 2019 and whose appointment has been recommended by the Nomination and Remuneration Committee and
by the Board of Directors at their Meetings held on May 28, 2019 for consideration by the Members under Section 160 of the
Companies Act, 2013 and the rules made thereunder (including any statutory modifications or amendments or re-enactments
thereof) and whose term of office expires at this Annual General Meeting and in respect of whom the Company has received a
notice in writing from a member proposing his candidature to the office of Director, be and is hereby appointed as a Director of
the Company and whose office shall not be liable to retire by rotation.”
Appointment of Ms. Sadhana Kaul (holding DIN: 02589934) as a Director of the Company.
4. To consider and, if thought fit, to pass, the following Resolution as an Ordinary Resolution:
“RESOLVED THAT Ms. Sadhana Kaul (holding DIN:02589934), who was appointed as an Additional Director of the Company from
October 31, 2018 and whose appointment has been recommended by the Nomination and Remuneration Committee and by
the Board of Directors at their Meetings held on October 30, 2018 for consideration by the Members under Section 161(1) of the
Companies Act, 2013 and the rules made thereunder (including any statutory modifications or amendments or re-enactments
thereof) and Article 115 of the Articles of Association of the Company and whose term of office expires at this Annual General
Meeting and in respect of whom the Company has received a notice in writing from a member proposing her candidature to the
office of Director, be and is hereby appointed as a Director of the Company and whose office shall be liable to determination by
retirement of Directors by rotation.”

Ratification of remuneration payable to Messrs. Rao, Murthy & Associates, Cost Auditors for the Financial Year 2019-20.
5. To consider and, if thought fit, to pass, the following Resolution as an Ordinary Resolution:
“RESOLVED THAT pursuant to the provisions of Section 148(3) and other applicable provisions, if any, of the Companies Act,
2013 and the Companies (Audit and Auditors) Rules, 2014 (including any statutory modifications or re-enactment thereof ), the
remuneration payable to Messrs. Rao, Murthy & Associates, Bengaluru (holding ICAI Registration No. 000065), Cost Auditors,
appointed by the Board of Directors based on the recommendation of the Audit Committee of the Company to conduct the audit
of the Cost records of the Company for the financial year 2019-20 amounting to Rs. 475,000/- (Rupees Four Lakhs Seventy Five

41
NOTICE TO THE MEMBERS 3M India Limited

Thousand only) including applicable taxes and re-imbursement of out of pocket expenses incurred by them in connection with the
audit of cost records, be and is hereby ratified and approved.”

Re-appointment of Mr. Biren Gabhawala (holding DIN: 03091772) as an Independent Director of the Company for a second
term.
6. To consider and, if thought fit, to pass, the following Resolution as a Special Resolution:
“RESOLVED THAT pursuant to the provisions of Sections 149, 150 and 152 read with Schedule IV and any other applicable
provisions of the Companies Act, 2013 and the Companies (Appointment and Qualification of Directors) Rules, 2014 (including
any statutory modification(s) or re-enactment thereof for the time being in force) and Securities and Exchange Board of India
(Listing Obligations and Disclosure Requirements) Regulations, 2015, consent of the Members of the Company be and is hereby
accorded to re-appoint Mr. Biren Gabhawala (holding DIN: 03091772) as an Independent Director and whose appointment has
been recommended by the Nomination and Remuneration Committee and by the Board of Directors at their Meetings held on
May 28, 2019 for consideration by the Members and who has submitted a declaration to the effect that he meets the criteria for
independence as provided in Section 149(6) of the Companies Act, 2013 and who is eligible for re-appointment to the office of
Independent Director, for a second term i.e., to hold office for a period of 5 (five) consecutive years with effect from August 14,
2019 to August 13, 2024, and whose office shall not be liable to retire by rotation.”

Appointment of Mr. Ramesh Ramadurai (holding DIN: 07109252) as Managing Director of the Company.
7. To consider and, if thought fit, to pass, the following Resolution as an Ordinary Resolution:
“RESOLVED THAT pursuant to the provisions of Sections 2(54), 196, 197 and 203 and any other applicable provisions, if any, of the
Companies Act, 2013, read with Schedule V to the Companies Act, 2013 and the Companies (Appointment and Remuneration of
Managerial Personnel) Rules, 2014 (including any statutory modification(s) or re-enactment thereof for the time being in force),
and subject to the requisite approval of the Central Government, the consent of the Company be and is hereby accorded to
the appointment of Mr. Ramesh Ramadurai (holding DIN-07109252), Director of the Company, as the Managing Director of the
Company by the Board of Directors for a period from June 1, 2019 to February 12, 2022 (till the date of his superannuation), on
the terms and conditions of appointment and remuneration as contained in the agreement, and the Board of Directors is hereby
authorized to alter and vary such terms of appointment and remuneration so as to not exceed the limits specified in Schedule V
to the Companies Act, 2013 as may be agreed, to by the Board of Directors and Mr. Ramesh Ramadurai, and whose office shall
not be liable to retire by rotation.”
By order of the Board
Place : Bengaluru V. Srinivasan
Date : May 28, 2019 Company Secretary
Registered Office: Plot Nos. 48-51, Electronic City, Hosur Road, Bengaluru – 560100 ACS-16430

NOTES:
1. A MEMBER ENTITLED TO ATTEND AND VOTE AT THE MEETING IS ENTITLED TO APPOINT A PROXY / PROXIES TO ATTEND AND
VOTE INSTEAD OF HIMSELF / HERSELF AND SUCH PROXY / PROXIES NEED NOT BE A MEMBER OF THE COMPANY. A PERSON CAN
ACT AS PROXY ON BEHALF OF MEMBERS NOT EXCEEDING FIFTY (50) AND HOLDING IN THE AGGREGATE NOT MORE THAN TEN
(10) PERCENT OF THE TOTAL SHARE CAPITAL OF THE COMPANY. THE INSTRUMENT OF PROXY IN ORDER TO BE EFFECTIVE MUST
BE DEPOSITED/LODGED AT THE REGISTERED / CORPORATE OFFICE OF THE COMPANY DULY COMPLETED AND SIGNED NOT LATER
THAN 48 HOURS BEFORE THE TIME FIXED FOR HOLDING THE MEETING. A PROXY FORM IS SENT HEREWITH. PROXIES SUBMITTED
ON BEHALF OF THE COMPANIES, SOCIETIES ETC., MUST BE SUPPORTED BY AN APPROPRIATE RESOLUTION/AUTHORITY, AS
APPLICABLE.
2. Explanatory Statement pursuant to Section 102 of the Companies Act, 2013, in respect of Special Business is annexed hereto.
3. The Register of Members and the Share Transfer Books of the Company will remain closed from Saturday, August 10, 2019 to
Wednesday, August 14, 2019 (both days inclusive).
4. The shares of the Company are mandated by the Securities and Exchange Board of India for trading in dematerialized form by all
investors. Members holding shares in physical form are advised to dematerialize their shares to avoid the risks associated with
the physical holding of such share certificates. The Securities and Exchange Board of India (SEBI) has mandated the submission
of Permanent Account Number (PAN) by every participant in securities market. Members holding shares in electronic form are,
therefore, requested to submit the PAN to their Depository Participants with whom they are maintaining their demat accounts.
Members holding shares in physical form can submit their PAN details to the Company’s Registrar and Transfer Agent.

42
NOTICE TO THE MEMBERS 3M India Limited

5. The Registrar and Transfer Agent: Karvy Fintech Private Limited (formerly: Karvy Computershare Private Limited) Karvy Selenium
Tower-B, Plot Nos. 31 & 32, Financial District, Gachibowli, Nanakramguda, Serilingampally, Hyderabad- 500 032 is handling registry
work in respect of shares held both in physical form and in electronic/demat form.
6. Members are requested to bring their copy of the Annual Report and the Attendance Slip to the Annual General Meeting. ONLY
MEMBERS/ AUTHORISED REPRESENTATIVES OF THE CORPORATE MEMBERS/ PROXIES WILL BE ADMITTED INTO THE HALL FOR
THE MEETING.
7. Members may refer Additional Information on Directors recommended for appointment / re-appointment under the provisions of
Listing Regulations.
8. Members holding Shares in electronic form are requested to register their e-mail address with their respective depository
participants and members holding shares in Physical form are requested to register their e-mail address with the Company’s
Registrar and Transfer Agents and participate in the “Green initiative” launched by the Ministry of Corporate Affairs in future. As
per rule 3 of Companies (Management & Administration) Rules, 2014, Registers of Members of all the Companies now should
have additional details pertaining to e-mail, PAN / CIN, UID, Occupation, Status, Nationality. We request all the Members of the
Company to update their details with their respective depository participants in case of shares held in electronic form and with the
Company’s Registrar and Transfer Agents in the case of physical holding immediately.
9. Members holding shares in physical form are requested to notify to the Company’s Registrar and Transfer Agent of any change in
their address and update their Bank account details. Members holding Shares in electronic form are requested to notify any change
of address and update bank account details to their respective depository participants directly.
10. Pursuant to Section 72 of the Companies Act, 2013, shareholders holding Shares in physical form may file nomination in the
prescribed Form SH-13 with the Company’s Registrar and Transfer Agent. In respect of Shares held in electronic / demat form, the
nomination form may be filed with the respective Depository Participant.
11. Electronic copy of the Notice of the 32nd Annual General Meeting of the Company inter alia indicating the process and manner
of e-voting along with Attendance Slip and Proxy Form is being sent to all the members whose email IDs are registered with the
Company/Depository Participants(s) for communication purposes unless any member has requested for a hard copy of the same.
For members who have not registered their email address, physical copies of the Notice of the 32nd Annual General Meeting of
the Company inter alia indicating the process and manner of e-voting along with Attendance Slip and Proxy Form is being sent
in the permitted mode. All documents referred to in the accompanying Notice and the Explanatory Statement shall be open for
inspection during normal business hours on all working days except Saturdays, up to and including the date of the Meeting.
12. Voting through electronic voting system (Remote E-Voting) :
Pursuant to Section 108 of the Companies Act, 2013 read with Rule 20 of the Companies (Management and Administration)
Rules, 2014 as substituted by the Companies (Management and Administration) Amendment Rules, 2015 and Regulation 44 of
the Listing Regulations and Secretarial Standards on General Meetings (SS2) issued by the Institute of Company Secretaries of
India, the Company is pleased to provide the facility to Members to exercise their right to vote by electronic means. The Members,
whose names appear in the Register of Members / list of Beneficial Owners as on August 9, 2019 (Friday) i.e. the date prior to the
commencement of Book closure date are entitled to vote on the Resolutions set forth in this Notice. The remote e-voting period
will commence at 9.00 A.M. on August 11, 2019 (Sunday) to 5.00 P.M. on August 13, 2019 (Tuesday). It is hereby clarified that
it is not mandatory for a member to vote using the remote e-voting facility, and a member may avail of the facility at his/her/it
discretion, subject to compliance with the instructions prescribed below. The Company has engaged the services of Karvy Fintech
Private Limited (Karvy) for facilitating remote e-voting for the Annual General Meeting. The Members desiring to vote through
remote e-voting mode may refer to the detailed procedure on e-voting given hereinafter.
INSTRUCTION FOR REMOTE E-VOTING
(a) Use the following URL for remote e-voting: From Karvy website: https://evoting.karvy.com
(b) Shareholders of the Company holding shares either in physical form or in dematerialized form, as on the record date, may cast their
vote electronically.
(c) Enter the login credentials [i.e., user id and password mentioned in the Notice of the AGM]. The Event No+ Folio No/DP ID-Client
ID will be your user ID.
(d) After entering the details appropriately, click on LOGIN.
(e) You will reach the Password change menu wherein you are required to mandatorily change your password. The new password
shall comprise of minimum 8 characters with at least one upper case (A-Z), one lower case (a-z), one numeric value (0-9) and a

43
NOTICE TO THE MEMBERS 3M India Limited

special character (@,#,$ ). The system will prompt you to change your password and update any contact details like mobile, email
etc. on first login. You may also enter the secret question and answer of your choice to retrieve your password in case you forget
it. It is strongly recommended not to share your password with any other person and take utmost care to keep your password
confidential.
(f) You need to login again with the new credentials.
(g) On successful login, the system will prompt you to select the EVENT i.e., 3M India Limited and click on SUBMIT.
(h) Now you are ready for e-voting as “Cast Vote” page opens. On the voting page, the number of shares as held by the shareholder as
on August 9, 2019 (Friday) will appear. If you desire to cast all the votes assenting/dissenting to the Resolution, then enter all shares
and click FOR / AGAINST as the case may be. You are not required to cast all your votes in the same manner. You may also choose
the option ABSTAIN in case you wish to abstain from voting.
(i) Shareholders holding multiple folios / demat account shall choose the voting process separately for each folios / demat account.
(j) Cast your vote by selecting an appropriate option and click on SUBMIT. A confirmation box will be displayed. Click OK to confirm
else CANCEL to modify. Once you confirm, you will not be allowed to modify your vote. During the voting period, shareholders can
login any number of times till they have voted on the resolution.
(k) Once the vote on the resolution is cast by the shareholder, he shall not be allowed to change it subsequently.
(l) The Companies (Management and Administration) Amendment Rules, 2015 provides that the electronic voting period shall close
at 5.00 P.M. on the date preceding the date of the AGM. Accordingly, the Portal will be open for voting from: 9.00 A.M. on August
11, 2019 (Sunday) to 5.00 P.M. on August 13, 2019 (Tuesday).The e-voting module shall be disabled by Karvy at 5.00 P.M. on August
13, 2019 (Tuesday). During this period Shareholders’ of the Company, holding shares either in physical form or in dematerialized
form, as on the cut-off date of August 9, 2019 (Friday), may cast their vote electronically. Once the vote on a resolution is cast by
the shareholder, the shareholder shall not be allowed to change it subsequently.
(m) In case of any queries, you may refer the Frequently Asked Questions (FAQs) for shareholders and e-voting User Manual for
shareholders available at the download section of https://evoting.karvy.com or contact Mr. Rajeev Kumar of Karvy Fintech Private
Limited (Formerly: Computershare Private Ltd) at 040-67161524 OR at Tel No. 1800 345 4001 (toll free).
(n) The Company has appointed Mr. Vijayakrishna K.T, Practising Company Secretary, who in the opinion of the Board is a duly qualified
person, as a Scrutinizer who will collate the electronic voting process in a fair and transparent manner: provided that the scrutinizer
so appointed may take assistance of a person who is not in employment of the Company and who is well-versed with the electronic
voting system.
(o) The voting rights of the shareholders shall be in proportion to their Shares of the paid-up equity share capital of the Company as on
the cut-off date i.e. August 9, 2019 (Friday).
(p) The Members, whose names appear in the Register of Members / list of Beneficial Owners as on Friday, August 9, 2019, are entitled
to vote on the Resolutions set forth in this Notice.
(q) Any person, who acquires shares of the Company and becomes member of the Company after dispatch of the Annual Report
and holding shares as of the cut-off date i.e. August 9, 2019 (Friday), may obtain the login ID and password by sending an email to
evoting@karvy.com/ rajeev.kr@karvy.com, by mentioning their Folio No./DP ID and Client ID No. Else, if your Mobile number is
registered against Folio No./DP ID-Client ID, the member may send SMS:MYEPWD <space> Event Number + Folio or DP ID Client ID
to +91 9212993399.
Example for NSDL :MYEPWD <SPACE> IN12345612345678
Example for CDSL :MYEPWD <SPACE> 1402345612345678
Example for PHYSICAL :MYEPWD <SPACE> XXX1234567
However, if you are already registered with Karvy for remote e-voting then you can use your existing user ID and password for
casting your vote. If e-mail or mobile number of the member is registered against Folio No. /DP ID Client ID, then on the home page
of https://evoting.karvy.com, the member may click “forgot password” and enter Folio No. or DP ID Client ID and PAN to generate
as password.
(r) A member may participate in the meeting even after exercising his right to vote through remote e-voting but shall not be allowed
to vote again at the meeting.

44
NOTICE TO THE MEMBERS 3M India Limited

(s) Voting at AGM: The members who have not cast their votes by remote e-voting can exercise their voting rights at the AGM. The
Company will make arrangements of ballot papers/other means in this regard at the AGM Venue.
(t) The Scrutinizer shall within 48 hours of the conclusion of the e-voting period unblock the votes in the presence of at least two
witnesses not in the employment of the Company and make a Scrutinizer’s Report of the votes cast in favour or against, if any,
forthwith to the Chairman or designated Director or Key Managerial Personnel of the Company.
(u) The Results shall be declared within 48 hours of the conclusion of AGM. The results declared along with the Report of the Scrutinizer
shall be placed on the website of the Company www.3m.com/in and on https://evoting.karvy.com immediately after the result is
declared by the Chairman. The Company shall, simultaneously, forward the results to the Stock Exchanges where the Shares are
listed.
(v) In case of joint shareholders attending the meeting, only such joint holder who is higher in the order of names will be entitled to
vote.
(w) Institutional members (i.e., other than individuals, HUF, NRI etc.) are required to send scanned copy (PDF/JPG Format) of the
relevant Board Resolution / Authority letter etc., to the Scrutinizer through e-mail at vijaykt@vjkt.in, with a copy marked to
evoting@karvy.com. File naming convention should be ‘Corporate Name EVENT NO.’ The documents should reach the Scrutinizer
on or before the close of working hours on August 13, 2019 (Tuesday).
(x) In case a Member receives physical copy of the Notice of AGM (for members whose email IDs are not registered with the Company/
Depository Participant(s) or requesting physical copy) in the permitted mode:
(i) Initial password as below is given in the attendance slip for the AGM:

EVEN (E-Voting Event Number) USER ID PASSWORD

XXXXXXX XXXXXXX XXXXXXXX

(ii) Please follow all steps from Sl. No. (12)(c) to (12)(j) above to cast your vote.
ADDITIONAL INFORMATION ON DIRECTORS RECOMMENDED FOR APPOINTMENT / RE-APPOINTMENT AS PER THE PROVISONS OF
LISTING REGULTIONS:

Item no. 2
In terms of Sections 149, 152 and other applicable provisions of the Companies Act, 2013, for the purpose of determining the Directors
liable to retire by rotation, the Independent Directors and Whole-Time Directors shall not be included in the total number of Directors
of the Company. Mr. Jongho Lee, Non-Executive Director, shall accordingly retire at the forthcoming Annual General Meeting and being
eligible offers himself for re-appointment. A brief profile of Mr. Jongho Lee, nature of his expertise in specific functional areas, names of
companies in which he holds directorships, memberships of the Board’s Committees, shareholding in the Company and relationships
between Directors inter-se, as stipulated under the provisions of Listing Regulations are exhibited below:
Mr. Jongho Lee, Non-Executive Director (holding DIN- 06720950): Mr. Jongho Lee (JH), 56 years, was named Finance Director - Asia
based out of Hong Kong from April 1, 2017. JH comes with a strong pedigree and regional experience across multiple companies. JH has
most recently been 3M Korea Finance Manager since April 1, 2014. Prior to that, he has held several roles in multiple Companies as:
• VP & CFO, Korea Delphi Automotive Component Company
• FP&A Executive, GM Korea
• Korea Controller, GM
• Finance Controller, GM International Operation Manufacturing
• Asia Pacific HQs Strategy Board Planner (Shanghai), GM
• Finance Representative of Daewoo Group Restructuring Committee
• Treasurer, Daewoo Group
He is also the Co-Chairman of the AMCHAM CFO Committee, Korea and a Tax Committee Member of Korea Chamber of Commerce. JH
holds an MBA from the University of Michigan, Ann Arbor and a B.A., Seoul National University. He was appointed as a Non-Executive
Non-Independent Director of the Company from May 26, 2017.

45
NOTICE TO THE MEMBERS 3M India Limited

He is a Member of Audit Committee of the Company. He does not hold any Shares in the Company. There are no inter-se relationship
among the Board Members. Kindly refer to the Corporate Governance Report for the details of the Board/ Committee Meetings
attended by Mr. Jongho Lee.
Memberships/ Chairmanships of Audit and Stakeholders’ Relationship Committees across Public Companies including 3M India Limited
– Nil
List of Directorships held in other companies (excluding foreign, private and Section 8 Companies): Nil
Expertise in specific functional areas: Finance and General Management of Business Industry.
The Board of Directors commends the Ordinary Resolution set out at Item no.2 of the accompanying Notice for approval by the Members
Except Mr. Jongho Lee, none of the other Directors and Key Managerial Personnel of the Company and their relatives is concerned or
interested, financial or otherwise, in Item no. 2.
This Explanatory Statement may also be regarded as a disclosure under Listing Regulations.

EXPLANATORY STATEMENT PURSUANT TO SECTION 102 OF THE COMPANIES ACT, 2013.

For the details pertaining to Mr. Biren Gabhawala, Ms. Sadhana Kaul and Mr. Ramesh Ramadurai, please refer to the below Explanatory
Statements in respect of the Special Business set out at item nos. 3, 4, 6 and 7 of the Notice of Annual General Meeting pursuant to
Section 102 of the Companies Act, 2013.
Following Explanatory Statements are furnished in respect of Special Business:

Item nos. 3 and 6

Based on the recommendations of the Nomination and Remuneration Committee and performance evaluation carried out on February
12, 2019, the Board at its Meeting held on May 28, 2019 had appointed Mr. Biren Gabhawala as an Additional Director from August 5,
2019 categorized as Non-Executive Director and he will hold office till this Annual General Meeting. Accordingly, an Ordinary Resolution
seeking appointment of Mr. Biren Gabhawala (holding DIN: 03091772) as Director of the Company is included in the Notice convening
the Annual General Meeting at Item no. 3.
As per the provisions of Sections 149, 152 and Schedule IV of the Companies Act, 2013 read with the relevant Rules thereunder
as amended, the Company had appointed Mr. Biren Gabhawala (holding DIN: 03091772) as an Independent Director as per the
requirements of the Companies Act, 2013 at the Annual General Meeting held on August 4, 2014 for a term of five (5) consecutive
years. Earlier his first term was effective from August 5, 2014 to August 4, 2019.
Mr. Biren Gabhawala, Independent Director shall be completing his first term of appointment upon completion of five years on August
4, 2019 from his date of his appointment. He is eligible for re-appointment for another term of five (5) consecutive years subject to
approval of the Members by way of Special Resolution. He has consented to his re-appointment and confirmed that he does not suffer
from any disqualifications which stand in the way of his re-appointment as Independent Director.
The performance evaluation of the Independent Directors was conducted by the full Board of Directors (excluding the Director being
evaluated) based on a structured questionnaire.
Accordingly, based on the performance evaluation of the Independent Directors on February 12, 2019, the Nomination and
Remuneration Committee and the Board of Directors of the Company at their Meetings held on May 28, 2019, had recommended,
re-appointment of Mr. Biren Gabhawala (holding DIN: 03091772) as Independent Director for a second term of five (5) consecutive
years commencing from August 14, 2019 to August 13, 2024. During his tenure of appointment, he is not be liable to retire by rotation
as provided under Section 152(6) of the Companies Act, 2013. Accordingly, a Special Resolution seeking re-appointment of Mr. Biren
Gabhawala as an Independent Director of the Company is included in the Notice convening the Annual General Meeting at Item no. 6.
The Company has also received notice from a Member under Section 160 of the Companies Act, 2013 proposing his appointment and
re-appointment as Director.
A copy of the draft letter for re-appointment of the Independent Director setting out the terms and conditions of his re-appointment is
available for inspection by the Members at the Corporate Office of the Company during the office hours on all working days other than
on Saturdays and Sundays till the date of the Annual General Meeting.
A brief profile of Mr. Biren Gabhawala, nature of his expertise in specific functional areas, names of companies in which he holds
directorships, memberships of the Board’s Committees, shareholding in the Company and relationships between Directors inter-se, as
stipulated under the provisions of Listing Regulations are exhibited below:

46
NOTICE TO THE MEMBERS 3M India Limited

Mr. Biren Gabhawala, Independent Director (holding DIN- 03091772): Mr. Biren Gabhawala, 54, was appointed on the Board of the
Company as an Additional Director from August 5, 2014. At the Annual General Meeting held on August 4, 2015, he was appointed as
an Independent Director for a period of Five (5) years from August 5, 2014. He holds a Bachelor’s degree in Commerce from University
of Mumbai and is a qualified Chartered Accountant and a fellow member of the Institute of Chartered Accountants of India. He is into
practice for last 27 years. He is a Senior Partner of Messrs. C. M. Gabhawala & Co., Chartered Accountants and specializes in Direct and
Indirect Taxation, FEMA, International Taxation, Mergers, and Acquisitions.
He does not hold any Shares in the Company. There are no inter-se relationship among the Board Members. Kindly refer to the Corporate
Governance Report for the details of the Board/ Committee Meetings attended by Mr. Biren Gabhawala. He is the Chairman of the Risk
Management Committee of the Company with effect from April 1, 2019 and is also Chairman of Audit Committee and Nomination and
Remuneration Committee of the Company.
Memberships/ Chairmanships of Audit and Stakeholders’ Relationship Committees across Public Companies including 3M India Limited:

Name of the Company Membership of Committee Chairmanship of Committees

Audit Stakeholders’ Audit Stakeholders’
Relationship Relationship
3M India Limited Yes Yes Yes
eClerx Services Limited Yes Yes Yes
List of Directorships held in other companies (excluding foreign, private and Section 8 companies):
- eClerx Services Limited, Director
- Messrs. C.M. Gabhawala & Co, Partner
Expertise in specific functional areas: Direct and Indirect Taxation, FEMA, International Taxation, Mergers, and Acquisitions.
The Board of Directors commends the Ordinary and Special Resolutions set out at Item nos. 3 and 6 respectively of the accompanying
Notice for approval by the Members.
Except Mr. Biren Gabhawala, none of the other Directors and Key Managerial Personnel of the Company and their relatives is concerned
or interested, financial or otherwise, in Item nos. 3 and 6.
This Explanatory Statement may also be regarded as a disclosure under Listing Regulations.

Item no. 4
Based on the recommendations of the Nomination and Remuneration Committee, the Board at its Meeting held on October 30,
2018 appointed Ms. Sadhana Kaul (holding DIN: 02589934) as Additional Director of the Company categorized as Non-Executive Non-
Independent Director with effect from October 31, 2018 and will hold office till the Annual General Meeting to be held on August 14,
2019.
The Company has also received notice from a Member proposing her appointment as Director.
Accordingly, an Ordinary Resolution seeking appointment of Ms. Sadhana Kaul (holding DIN: 02589934) as Director of the Company is
included in the Notice convening the Annual General Meeting at Item no. 4.
A brief profile of Ms. Sadhana Kaul, nature of her expertise in specific functional areas, names of companies in which she holds
directorships, memberships of the Board’s Committees, shareholding in the Company and relationships between Directors inter-se, as
stipulated under the provisions of Listing Regulations are exhibited below:
Ms. Sadhana Kaul (DIN- 02589934): Mrs. Sadhana Kaul, 54, joined the 3M India Limited in the year 2005 as General Counsel and has
over 25 years of experience in the legal field, having worked in different capacities in law firms in the US and in India. Prior to joining 3M
India limited, she was with GE Medical Systems as Senior Legal Counsel based in Bangalore. She has a History Degree from St. Stephen’s
College, Delhi University, India and holds a Bachelor’s degree in Law from Trinity College Cambridge, UK and a Master’s degree in
International and Comparative Law from Georgetown University Law Center, Washington D.C.
She was appointed as a Whole-Time Director of the Company from October 09, 2009 and was the General Counsel of the Company till
November 1, 2013. She resigned from the offices of Director and Whole-Time Director with effect from November 1, 2013 consequent
upon her appointment as General Counsel for South East Asia Region, Singapore. Apart from being General Counsel for South East Asia
Region, she also supported Asia Manufacturing and Supply Chain Center of Expertise. She was appointed as a Non-Executive Director

47
NOTICE TO THE MEMBERS 3M India Limited

of the Company from February 10, 2014. She resigned as Director of the Company with effect from the closing hours of May 27, 2016
due to her pre-occupation and other commitments.
Ms. Sadhana Kaul has been appointed as Asia Area General Counsel effective September 1, 2018 and will continue to be based out of
Singapore where she will oversee the legal operations of 3M in all its Asia Subsidiaries.
She does not hold any Shares in the Company. There are no inter-se relationship among the Board Members. Kindly refer to the
Corporate Governance Report for the details of the Board/ Committee Meetings attended by Ms. Sadhana. She is a member of the
Nomination and Remuneration Committee and Risk Management Committee of the Company.
Memberships/ Chairmanships of Audit and Stakeholders’ Relationship Committees across Public Companies including 3M India Limited:
Nil
List of Directorships held in other companies (excluding foreign, private and Section 8 Companies): Nil
Expertise in specific functional areas: Law
The Board of Directors commends the Ordinary Resolution set out at Item no. 4 of the accompanying Notice for approval by the
Members
Except Ms. Sadhana Kaul, none of the other Directors and Key Managerial Personnel of the Company and their relatives is concerned
or interested, financial or otherwise, in Item no. 4.
This Explanatory Statement may also be regarded as a disclosure under Listing Regulations.

Item no. 5
The Board of Directors of the Company at its meeting held on May 28, 2019 had on the recommendation of the Audit Committee,
approved the re-appointment and remuneration of Messrs. Rao, Murthy & Associates, Cost Accountants, Bengaluru, (holding
Registration No. 000065), to conduct the audit of the cost records of the Company for the financial year ended March 31, 2020 for the
products covered as per the Companies (Cost Records and Audit) Rules, 2014, on an remuneration of Rs. 475,000/- plus applicable taxes
and out of pocket expenses at actuals.
In terms of the provisions of Section 148(3) of the Companies Act, 2013 read with Rule 14(a) (ii) of the Companies (Audit and Auditors)
Rules, 2014, the remuneration payable to the Cost Auditor is to be ratified by the Members of the Company. Accordingly, the Members
are requested to ratify the remuneration payable to the Cost Auditors as set out in the Resolution for the aforesaid services to be
rendered by them.
None of the Directors, Key Managerial Personnel of the Company and their relatives, is in any way concerned or interested or otherwise,
in the resolution set out at Item no.5.

Item no. 7
Based on the recommendations of the Nomination and Remuneration Committee, the Board of Directors at its meeting held on
May 28, 2019 has approved the appointment of Mr. Ramesh Ramadurai (holding DIN: 07109252), currently Non-Executive Director,
as Managing Director of the Company from June 1, 2019 in place of Ms. Debarati Sen, consequent upon her appointment as Vice
President and General Manager in Abrasives Systems Division, Safety and Industrial Business Group from June 1, 2019. He will be a Key
Managerial Personnel of the Company from June 1, 2019. This will however, be subject to the approvals of the Members at the ensuing
Annual General Meeting and the Central Government.
Approval of the Central Government will be sought for the appointment of Mr. Ramesh Ramadurai as the Managing Director, since
he was not staying in India for a continuous period of twelve (12) months immediately preceding the date of his appointment as the
Managing Director.
The appointment of Mr. Ramesh Ramadurai is appropriate and in the best interest of the Company. The approval of the members is
being sought for the appointment and for the terms, conditions and stipulations for the appointment of Mr. Ramesh Ramadurai as the
Managing Director and the remuneration payable to him. The terms and conditions fixed by the Board of Directors at its meeting held
on May 28, 2019 are keeping in line with the remuneration package that is necessary to encourage good professional managers with a
sound career record to important position as that of the Managing Director.
The terms of appointment and remuneration as contained in the agreement are given below: -
Period of Appointment: From June 1, 2019 to February 12, 2022(till the date of his superannuation).

48
NOTICE TO THE MEMBERS 3M India Limited

Salary including allowances and Incentives (excluding Perquisites): Not exceeding Rs. 39 Lakhs per month. (Upper limit for his entire
tenure)
Perquisites: He will be entitled to all the perquisites listed herein below in addition to the Salary including allowances and incentives
mentioned above.
Personal Accident Insurance: In accordance with the rules of the Company as applicable to the senior managers.
Club Fees: In accordance with the rules of the Company as applicable to the senior managers.
Provident Fund: Contribution to Provident Fund in accordance with the rules of the Company as applicable to the senior managers, to
the extent such contributions, either singly or put together are not taxable under the Income Tax Act, 1961.
Gratuity: In accordance with the rules of the Company as applicable to the senior managers.
Company car and driver: The Company shall provide a car with the driver for business and personal use in accordance with the rules of
the Company as applicable to the senior managers.
Other perquisites: He will be entitled to all other perquisites in accordance with the rules of the Company as applicable to the senior
managers. The perquisites stated shall be valued as per Income Tax Act, 1961, wherever applicable, and in the absence of any provisions
in the said Act, the perquisites shall be valued at actuals.
Minimum Remuneration: Notwithstanding anything herein above stated, where in any financial year during the currency of the tenure
of Mr. Ramesh Ramadurai, the Company incurs a loss or its profits are inadequate, the Company, subject to the approval of Central
Government, shall pay the same remuneration as stated above but subject to being within the overall limits on managerial remuneration
as provided under Section 197 and other applicable provisions of the Companies Act, 2013 including any statutory modification or re-
enactment thereof for the time being in force, and the rules framed there under read with Schedule V to the said Act. The Board of
Directors shall communicate the Central Government’s approval including any revision in the terms of remuneration to Mr. Ramesh
Ramadurai for his acceptance.
The Contract of service of Mr. Ramesh Ramadurai is terminable with a notice period of 90 days on either side.
He is not liable to retire by rotation.
No sitting fees shall be paid for attending the meetings of the Board of Directors or Committees thereof.
Accordingly, an Ordinary Resolution seeking appointment of Mr. Ramesh Ramadurai (holding DIN: 07109252) as Managing Director of
the Company is included in the Notice convening the Annual General Meeting at Item no. 7.
A brief profile of Mr. Ramesh Ramadurai, nature of his expertise in specific functional areas, names of companies in which he holds
directorships, memberships of the Board’s Committees, shareholding in the Company and relationships between Directors inter-se, as
stipulated under the provisions of Listing Regulations are exhibited below:
Mr. Ramesh Ramadurai, Non-Executive Director (holding DIN- 07109252): Mr. Ramesh Ramadurai, 57, was appointed as Business
Director for 3M Industrial Business in July 2014 and is based out of Shanghai responsible for the entire Asia Pacific Area. Prior to this role,
Mr. Ramesh Ramadurai served as Managing Director of 3M Philippines from August 2011 until June 2014, based in Manila. He Joined 3M
India in 1989 as Sales Engineer and held positions as Country Business Leader in Industrial Business and Electro & Telecommunications.
He was seconded to Global Headquarters in St Paul, USA, and worked as Market Segment Manager in Industrial Business, as Global
Business Manager for a line of Industrial Tapes, and as International Business Manager for 3M’s Packaging, Masking and Specialty
Tapes businesses. Prior to 3M, Mr. Ramesh Ramadurai worked for a year as a Production Engineer at an Offshore Oil Production facility,
and for about 3 years in a business planning and development role at an automotive parts and motorcycle manufacturer. Mr. Ramesh
Ramadurai holds MBA from the Indian Institute of Management in Calcutta and is a Bachelor of Technology in Chemical Engineering
from the Indian Institute of Technology, Kanpur. He was appointed as a Non-Executive Non-Independent Director of the Company from
March 27, 2015.
He is a Member of Corporate Social Responsibility Committee of the Company and has been appointed as a member of the Stakeholder’s
Relationship Committee and Risk Management Committee of the Company from June 1, 2019. He does not hold any Shares in the
Company. There are no inter-se relationship among the Board Members. Kindly refer to the Corporate Governance Report for the
details of the Board/ Committee Meetings attended by Mr. Ramesh Ramadurai.
Memberships/ Chairmanships of Audit and Stakeholders’ Relationship Committees across Public Companies including 3M India Limited
– Nil
List of Directorships held in other companies (excluding foreign, private and Section 8 Companies): Nil

49
 3M India Limited

Expertise in specific functional areas: General Management of Business Industry and Marketing
The Board of Directors commends the Ordinary Resolution set out at Item no.7 of the accompanying Notice for approval by the Members
Except Mr. Ramesh Ramadurai, none of the other Directors and Key Managerial Personnel of the Company and their relatives is
concerned or interested, financial or otherwise, in Item no. 7.
This Explanatory Statement may also be regarded as a disclosure under Listing Regulations.
By order of the Board
Place : Bengaluru V. Srinivasan
Date : May 28, 2019 Company Secretary
Registered Office: Plot Nos. 48-51, Electronic City, Hosur Road, Bengaluru – 560100 ACS-16430

ROUTE MAP TO THE VENUE OF THE ANNUAL GENERAL MEETING OF THE COMPANY
TO BE HELD ON WEDNESDAY, AUGUST 14, 2019 AT 11.00 A.M.
at TRINITY HALL, TAJ MG ROAD, 41/3, MAHATMA GANDHI ROAD, BENGALURU – 560 001.

AGM VENUE:
TAJ MG ROAD
41/3, MAHATMA
Bhaskaran Road

1 MG Road Mall

GANDHI ROAD,
TAJ MG ROAD

BENGALURU – 560 001

Trinity Metro Station

Citibank The Oberoi Vijaya Bank

Trinity
Mahatma Gandhi Road Circle Swami Vivekanada Road

Trinity Metro
Station
Du Parc
Trinity
Trinity Church Road

MAP NOT TO
GENERAL K.S. SCALE
THIMAYYA ROAD

50
NOTE TO THE MEMBERS 3M India Limited

To the kind attention of the Members of the Company holding shares in physical form:

As you all aware, the shares of the Company are mandated by the Securities and Exchange Board of India (SEBI) for trading in dematerialized
form by all Members.
We give below a brief overview of Depository, Depository Participants and Dematerialization (Demat) of Shares in order to encourage
Members of the Company to convert their physical holdings to Demat form.
Depository/ Depository Participant:
A Depository can be compared to a bank. A Depository holds securities (like shares, debentures, bonds, Government Securities, units
etc.) of Members in electronic form. Besides holding securities, a Depository also provides services related to transactions in securities.
In India National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL) are the 2 Depositories.
A Depository interfaces with the members through its agents called Depository Participants (DPs). If a member wants to avail the
services offered by the Depository, the member has to open an account with a DP. This is similar to opening an account with any branch
of a bank in order to utilize the bank’s services. NSDL/CDSL provides its services to members through its agents called Depository
Participants (DPs).
These agents are appointed by NSDL/CDSL with the approval of SEBI. According to SEBI Regulations, amongst others, 3 categories of
entities i.e. Banks, Financial Institutions and Members of Stock Exchanges [brokers] registered with SEBI can become DPs. You can get a
list of DPs from NSDL’s/CDSL’s office or from their respective websites viz., at www.nsdl.co.in and www.cdslindia.com.
You can select your DP to open a Demat account just like you select a bank for opening a savings account. Some of the important factors
for selection of a DP can be: Convenience - Proximity to your office/residence, business hours; Comfort - Reputation of the DP, past
association with the organization, whether the DP is in a position to give the specific service you may need? ; Cost - The service charges
levied by DP and the service standards.
You can approach any DP of your choice and fill up an account opening form. At the time of opening an account, you may have to sign an
agreement with the DP in a NSDL/CDSL prescribed standard agreement, which details you and your DPs rights and duties. You will have
to submit the documents relating to Proof of Identity, Proof of Address, Pass port size photographs etc., with the prescribed account
opening form.
Procedure and Benefits of Dematerialization (Demat) of shares are given below:
1. Demat is a process by which shares/securities held in physical form are cancelled and destroyed and the ownership thereof is
retained in fungible form in a Depository by way of electronic balances.
2. The benefits of Demat are:
- Elimination of bad deliveries;
- Elimination of all risks associated with physical certificates;
- No stamp duty on transfers;
- Immediate transfer and trading of shares;
- Faster disbursement of non-cash corporate benefits like rights, bonus etc.,;
- Periodic status reports and information available on internet;
- Ease related to change of address of member;
- Elimination of problems related to transmission of demat shares and ease in pledging the shares.
3. Procedure for getting demat shares in the name of legal heirs in the event of death of sole beneficial owner with nomination:
- If the value of shares of the Company as on date of application is up to Rs. 5 Lakhs, the legal heirs should submit the
following documents to the DP: Notarized copy of the death certificate; Transmission Request Form (TRF); Affidavit- to the
effect of the claim of legal ownership to the shares; Deed of indemnity – Indemnifying the depository and DP; NOC from
legal heirs, if applicable or family settlement deed duly executed by all legal heirs of the deceased beneficial owner.
- If the value of the shares of the Company as on date of application is more than Rs. 5 Lakhs, the legal heirs should
additionally submit one of the following documents to the DP: Surety Form; Succession certificate; Probated will and Letter
of administration.
We sincerely hope that the above information is useful and helpful to our Members of the Company. Members holding shares in
physical form are advised to dematerialize their shares to avoid the risks associated with the physical holding of such share certificates.
The Securities and Exchange Board of India (SEBI) has mandated the submission of Permanent Account Number (PAN) by every
participant in securities market. Members holding shares in physical form can submit their PAN details to the Company’s Registrar and
Transfer Agent (R&T) – Karvy Fintech Private Limited, Karvy Selenium Tower B, Plot 31-31, Gachibowli, Financial District, Nanakramguda,
Hyderabad – 500 032.

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REPORT OF THE BOARD OF DIRECTORS 3M India Limited

REPORT OF THE BOARD OF DIRECTORS

To the Members of 3M India Limited,
Your Directors have pleasure in presenting the Thirty Second (32nd) Annual Report of the Company. The Standalone and Consolidated
Financial Statements of the Company for the financial year ended March 31, 2019 are prepared in compliance with the applicable
provisions of the Companies Act, 2013 including Indian Accounting Standards. The audited standalone and consolidated financial
statements together with the Auditors’ Report thereon form part of the Annual Report.

FINANCIAL HIGHLIGHTS – Standalone and Consolidated (Rs. in Lakhs)

Particulars Standalone Consolidated
Year ended Year Ended % age Year ended Year Ended % age
March 31, March 31, increase / March 31, March 31, increase /
2019 2018 decrease (-) 2019 2018 decrease (-)
Revenue from Operations 280,875.97 258,039.60 8.85% 301,682.24 273,418.82 10.34%
Of which -Export Sales 2,696.81 1,627.92 65.66% 3,046.68 2,382.43 27.88%
Other Income, net 3,283.16 4,361.54 -24.72% 3,683.12 4,478.82 -17.77%
Total Income 284,159.13 262,401.14 8.29% 305,365.36 277,897.64 9.88%
Less: Expenditure 230,116.35 210,058.45 9.55% 248,123.58 223,557.68 10.99%
Profit before Interest and Depreciation 54,042.78 52,342.69 3.25% 57,241.78 54,339.96 5.34%
Less: Finance costs 109.18 194.07 -43.74% 112.26 202.92 -44.68%
Less: Depreciation and amortization expense 4,187.67 4,180.32 0.18% 4,375.63 4,350.60 0.58%
Profit before Taxation 49,745.93 47,968.30 3.71% 52,753.89 49,786.44 5.96%
Less: Tax expense 17,446.85 16,914.74 3.15% 18,439.39 17,456.34 5.63%
Profit for the year 32,299.08 31,053.56 4.01% 36,617.99 33,335.08 9.85%
Less:
Profit from discontinued operations - - - 91.07 754.38 -87.93%
Gain on disposal of discontinued operations - - - 3,171.66 905.00 250.46%
Tax expense of discontinued operations - - - 959.24 654.40 46.58%
Items that will not be re-classified (12.77) (26.25) -51.35% (6.37) (20.38) -68.74%
subsequently to profit or loss
Total Comprehensive income for the year 32,286.31 31,027.31 4.06% 36,611.62 33,314.70 9.90%

DIVIDEND
Your Board of Directors approved the Dividend Distribution Policy on February 9, 2017 in terms of SEBI (Listing Obligations and
Disclosure Requirements), Regulations 2015. The Policy was uploaded at http://solutions.3mindia.co.in/wps/portal/3M/en_IN/about-
3M/information/corporate/financial-facts/summary/ and the same is also annexed herewith as “Annexure J”.
The Company remains invested in India and sees significant tailwinds from policy and demand in several sectors including electronics
where the Company has made its most recent investment through the acquisition of 3M Electro & Communication India Private
Limited. The Company remains bullish on investments and growth expectations in India in near term as well as medium term helped by
strong fundamentals in the economy and the Company sees itself implementing several initiatives and projects to leverage the same
including CAPEX, manpower and related infrastructure. The Company therefore has decided to conserve and retain the earnings and is
not proposing a dividend or transfer of any amounts to reserves.
Transfer of dividend to the Investor Education and Protection Fund, if any: NA

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REPORT OF THE BOARD OF DIRECTORS 3M India Limited

TRANSFER TO RESERVES
As it has been decided to conserve and retain the earnings and, therefore, your Board does not propose to transfer any amounts to
reserves.

INFORMATION ON THE FINANCIAL PERFORMANCE / FINANCIAL POSITION OF THE SUBSIDIARIES / ASSOCIATES/ JOINT VENTURE
In accordance with Section 129(3) of the Companies Act, 2013, a statement containing salient features of the financial statement of the
Subsidiary Company in Form AOC-1 is provided as “Annexure L” to this report.

3M Electro & Communication India Private Limited (3M E&C)

During the year under review, the revenue from operations of 3M E&C increased to Rs. 20,913.04 Lakhs in the financial year 2018-19
compared to Rs.15,450.03 Lakhs in financial year 2017-18. The Profit before tax for the year financial year 2018-19 is Rs. 3,007.96 Lakhs
as against Rs. 1,818.14 Lakhs in the financial year 2017-18. The Profit after tax for the financial year 2018-19 is Rs. 4,325.33 Lakhs as
against Rs. 2,287.41 Lakhs in the financial year 2017-18.

Brief highlights of 3M E&C:

• The Electrical Business ventured in the extra high voltage segment by localizing the portfolio and leveraging technical and sales
competencies. Your Company bagged several wins from utilities and industrial projects.
• Government’s approach to Mobility Transformation has paved the way for Automotive Electrification (AE). 3M is contributing to this
by working with stakeholders engaged in AE, including automobile OEMs. A fully dedicated team has been set up which is working in
collaboration with Auto OEMs, Design houses, Regulatory Bodies, Battery Manufacturers, EV charger manufacturer to bring about
technical advancement in this space.
In accordance with the third proviso to Section 136(1) of the Companies Act, 2013, the Annual Report and Financial Statements of the
Subsidiary Company for the financial year 2018-19 have also been placed on the website of the Company. http://solutions.3mindia.
co.in/wps/portal/3M/en_IN/about-3M/information/corporate/financial-facts/summary/.

STATE OF COMPANY’S AFFAIRS

The Indian economy continues to be a bright spot in the world with strong growth momentum and favorable indicators. The year 2018
saw several short-term headwinds in the macro economy – dipping inflation, farm distress, liquidity issues, Banking NPAs, etc. Tailwinds
were seen in infrastructure, retail, ecommerce markets. India will continue to push the infrastructure agenda for the next several years
to bridge the gap of rapid urbanization and quality of life in cities.
Your Company has continued its strong growth trajectory with consistent performance even in the face of short-term headwinds.
The Company was able to do so because of its sharp focus on quality of business, portfolio prioritization, operational discipline and
continued commitment to ethics and compliance. “Customer first” continues to be at the core of everything that the Company does.
Much like the financial year 2017-18, the efforts continue to focus around, and the Board is pleased to highlight that your Company:
 Geographical penetration: Has expanded presence with deeper penetration in Tier B & C cities which is the real driver of demand
in India.
 Government and Infrastructure initiatives: Your Company has aligned with several national infrastructure initiatives through focused
work on regulatory, helping in many cases to set national standards in areas such as safety.
 Channel Transformation: Has introduced several steps to improve channel health through simplified processes, professional
management and rationalization.
 Market & Segment Growth: Has gained from strong performances in key growth market segments such as infrastructure, energy
and consumer reflecting positive market trends.
 Winning through localization: Continues to participate and drive local manufacturing bolstered by robust new product introduction
process and value addition.
The year 2018 saw the Company win several prestigious awards and garner industry recognitions in acknowledgment to performance.
Your Company continues to go after bigger and bolder opportunities and strives to be a highly valued partner for customers.
The Board of Directors at its meeting held on May 30, 2018 and shareholders through postal ballot on July 26, 2018 approved the
investment in the entire equity share capital of 3M Electro & Communication India Private Limited. The investment was completed on
December 27, 2018 for a value of Rs. 58,470 Lakhs. The above business combination is a common control transaction and accordingly
has been accounted for using the pooling of interest method with effect from April 1, 2017. 3M India Limited acquired net assets of Rs.
9,188 Lakhs resulting in an adjustment of Rs. 49,282 Lakhs in consolidated total reserves. 3M Electro & Communication India Private
Limited became a 100 % Subsidiary of the Company with effect from December 27, 2018.

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REPORT OF THE BOARD OF DIRECTORS 3M India Limited

The Company on a standalone basis registered an overall turnover growth of 8.85% at Rs. 280,875.97 Lakhs for the financial year
ended March 31, 2019 compared to Rs. 258,039.60 Lakhs in the previous financial year. The Profit before Interest and Depreciation
is Rs. 54,042.78 Lakhs compared to Rs. 52,342.69 for the previous financial year. Profit before Tax is Rs. 49,745.93 Lakhs compared to
Rs. 47,968.30 Lakhs for the previous financial year. The operating margin for the current year is 19.02% compared to 19.95% for the
previous financial year. Total Comprehensive Income is Rs. 32,286.31 Lakhs compared to Rs. 31,027.31 Lakhs for the previous financial
year. Portfolio prioritization, operational productivity and lower material costs increased the profitability at all levels for the financial
year under review. Export Sales is Rs. 2,696.81 Lakhs for the financial year ended March 31, 2019 compared to Rs. 1,627.92 Lakhs in the
previous financial year, an increase of 65.66%, due to increase in demand in global market.
The Industrial business grew by 4.90%; Health Care business grew by 6.60%: Safety and Graphics business grew by 7.91%; Consumer
business grew by 11.22% and Energy business grew by 36.01%.
The EPS (Basic and Diluted) of the Company for the financial year 2018-19 was Rs. 286.72 per Share as compared to Rs. 275.66 per
Share in the previous financial year, a growth of 4.01%. Detailed analysis of the performance has been discussed in the Management’s
Discussion and Analysis Section of the Annual Report.

Segment Change from April 1, 2019:

3M’s new Business group re-alignment was announced re-aligning from 5 (five) business groups to 4 (four). The new Business Groups
are Safety and Industrial Business, Transportation and Electronics Business, Health Care Business and Consumer Business. This was
a key first step for the Company in advancing 3M into the future and strengthen our ability to meet the fast-moving needs of the
global customers and markets. The new alignment is designed to leverage the Company’s business transformation progress, accelerate
growth and deliver greater operational efficiencies.
Your Company has also aligned the organization to the new Business Groups and position the organization for the future leading the
local execution of go-to-market plans, building on strong relationships with customers and channel partners and representing the voice
of customer for our markets.

CONTRIBUTION TO EXCHEQUER:
During the financial year 2018-19, the Company has paid various taxes on account of its business/operation viz., VAT & CST, SGST, CGST,
IGST, Direct Taxes and Customs Duty amounting to Rs. 72,938 Lakhs in aggregate.

INVESTMENTS:
Capital Investments during the financial year 2018-19 is Rs. 3,084.21 Lakhs (Net of capital work-in-progress and capital advances) (2017-
18: Rs. 1,641.10 Lakhs).

MATERIAL CHANGES AND COMMITMENTS

There have been no material changes and/or commitments affecting the financial position of the Company since the close of the
financial year and till the date of this report.

CHANGE IN THE NATURE OF BUSINESS

There were no changes in the nature of business during the year under review.

MANAGEMENT DISCUSSION AND ANALYSIS

The Management Discussion and Analysis Report is annexed herewith as “Annexure A”.

CORPORATE GOVERNANCE AND SHAREHOLDER INFORMATION

A separate Report on Corporate Governance in terms of Regulation 34 of Securities and Exchange Board of India (Listing Obligations
and Disclosure Requirements) Regulations, 2015 (hereinafter referred as “Listing Regulations”) along with Certificate from a Practising
Company Secretary regarding compliance to the conditions stipulated under Chapter IV of the Listing Regulations is annexed as
“Annexure B”.

BUSINESS RESPONSIBILITY REPORT

A separate Section on Business Responsibility is annexed as “Annexure C” and forms part of this Annual Report as required under
Regulation 34(2)(f) of SEBI (Listing Obligations and Disclosure Requirements), Regulations 2015.

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REPORT OF THE BOARD OF DIRECTORS 3M India Limited

EQUITY SHARES WITH DIFFERENTIAL VOTING RIGHTS

The Company has only one class of Share, i.e. Equity Share with a face value of Rs. 10/- each. The Authorized/Issued/Subscribed and
fully paid-up Share Capital as at March 31, 2019 is Rs. 11,26,50,700 (divided into 1,12,65,070 Equity Shares of Rs. 10/- each).
During the year under review, the Company has not issued shares with differential voting rights nor granted stock options nor sweat
equity.

LISTING WITH STOCK EXCHANGES

The Company has paid the Annual Listing Fees for the financial year 2019-20 to National Stock Exchange of India Limited (NSE) and BSE
Limited (BSE) where the Company’s Equity Shares are listed.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

Based on the recommendations of the Nomination and Remuneration Committee, the Board at its Meeting held on October 30, 2018
appointed Ms. Sadhana Kaul (DIN: 02589934) as Additional Director of the Company categorized as Non-Executive Non-Independent
Director with effect from October 31, 2018 and she will hold office till the Annual General Meeting to be held on August 14, 2019.
Accordingly, a resolution seeking appointment of Ms. Sadhana as a Director of the Company is included in the Notice convening the
Annual General Meeting. Details of Ms. Sadhana are exhibited in the Explanatory Statement to the Notice of the Annual General Meeting.
The Board of Directors recommends her appointment as Director of the Company. The Board once again welcomes Ms. Sadhana Kaul
as a Director of the Company.
Mr. Albert C Wang (DIN: 05234667), Non-Executive Non-Independent Director resigned as Director of the Company from the closing
hours of August 21, 2018 due to the change in global position and his appointment as General Counsel for Greater China. The Board
places on record its appreciation for the contributions made by Mr. Albert Wang to the progress of the Company during his tenure as
Director.
Based on the recommendations of the Nomination and Remuneration Committee and performance evaluation carried out on February
12, 2019, the Board at its Meeting held on May 28, 2019 has appointed Mr. Biren Gabhawala (DIN: 03091772) as an Additional Director
from August 5, 2019 categorized as Non-Executive Director and will hold office till the Annual General Meeting to be held on August
14, 2019.
Further, Mr. Biren Gabhawala (DIN: 03091772) has also been proposed to be appointed as an Independent Director with effect from
August 14, 2019 for second term since his first term ends on August 4, 2019. Accordingly, a Special Resolution seeking re-appointment
of Mr. Biren Gabhawala as Independent Director of the Company is included in the Notice convening the Annual General Meeting.
Details of Mr. Biren Gabhawala are exhibited in the Explanatory Statement to the Notice of the Annual General Meeting. The Board of
Directors recommends his appointment as Director and appointment as an Independent Director of the Company for the second term.
Mr. Jongho Lee (DIN: 06720950) will retire by rotation at the ensuing Annual General Meeting and being eligible offers himself for re-
appointment. The details of Mr. Jongho Lee are exhibited in the Explanatory Statement to the Notice of the Annual General Meeting.
The Board of Directors recommends his re-appointment.
Based on the recommendations of the Nomination and Remuneration Committee, subject to the requisite approvals from the Members
and the Central Government, the Board at its Meeting held on May 28, 2019 has appointed Mr. Ramesh Ramadurai (DIN: 07109252),
Director of the Company, as Managing Director of the Company for a period from June 1, 2019 to February 12, 2022 (till the date of his
superannuation) in place of Ms. Debarati Sen. The Board of Directors welcomes Mr. Ramesh Ramadurai as Managing Director to the
Board. The details of Mr. Ramesh Ramadurai are furnished in the Explanatory Statement to the Notice convening the Annual General
Meeting. The Board recommends his appointment. He will be a Key Managerial Personnel of the Company from June 1, 2019.
Ms. Debarati Sen (DIN:07521172) shall cease to be the Managing Director of the Company from the closing hours of May 31, 2019
consequent upon her appointment as Vice President and General Manager in Abrasives Systems Division, Safety and Industrial
Business Group and will be based out of St. Paul, USA. The Board expresses its deep appreciation of the valuable contributions made
by Ms. Sen during her tenure as Managing Director of the Company to the progress of the Company. Ms. Debarati Sen will continue as
Non-Executive Director of the Company from June 1, 2019.
As at the financial year ended March 31, 2019, Ms. Debarati Sen, Managing Director, Mr. B.V. Shankaranarayana Rao, Whole-time
Director, Ms. Mamta Janak Gore, Chief Financial Officer and Mr. V. Srinivasan, Company Secretary and Compliance Officer, are the Key
Managerial Personnel of the Company.

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REPORT OF THE BOARD OF DIRECTORS 3M India Limited

DECLARATION FROM INDEPENDENT DIRECTORS

The Company has received necessary declarations from each Independent Directors of the Company under the provisions of Section
149(7) of the Companies Act, 2013, that they meet the criteria of their Independence laid down under the provisions of Section 149(6)
of the Companies Act, 2013 read with Listing Regulations. All the Independent Directors have also confirmed under Regulation 16(b)
of SEBI (LODR) Regulations, 2015 that they are not Non-Independent Director of another Company on the Board of which any Non-
Independent Director of the listed entity is an Independent Director.

DETAILS OF BOARD AND COMMITTEE MEETINGS DURING THE YEAR

During the financial year ended March 31, 2019, four (4) Meetings of the Board were held. The date and number of Meetings attended
by each Director / Committee Member along with other Committee Meetings details are furnished in the Corporate Governance
Report.

COMPOSITION OF AUDIT COMMITTEE

As on the financial year ended March 31, 2019, the Audit Committee of the Company consisted of three (3) Non-Executive Independent
Directors and one (1) Non-Executive Director and all of them have financial and accounting knowledge. The Members of the Committee
are Mr. Biren Gabhawala (Chairman), Mr. Bharat Shah, Ms. Radhika Rajan, and Mr. Jongho Lee. The Board has accepted all the
recommendations made by the Audit Committee during the year under review.

NOMINATION AND REMUNERATION COMMITTEE POLICY

The Board has, on the recommendation of the Nomination & Remuneration Committee framed a Policy for selection and appointment
of Directors, Senior Management and for other employees and their remuneration. The same has been disclosed on the website at
http://solutions.3mindia.co.in/wps/portal/3M/en_IN/about-3M/information/corporate/financial-facts/summary/. The composition,
criteria for selection of Directors and the terms of reference of the Nomination and Remuneration Committee is stated in the Corporate
Governance Report.

ANNUAL BOARD EVALUATION

The Board of Directors has carried out an annual evaluation of its own performance, its Committees and Directors pursuant to the
requirements of the Companies Act, 2013, Listing Regulations and as per the Guidance Note issued by SEBI. Further, the Independent
Directors, at their exclusive meeting held during the year, reviewed the performance of the Board, its Chairman and Non-Executive
Directors and other items as stipulated under the Listing Regulations. The manner in which the evaluation has been carried out has
been explained in the Corporate Governance Report.

DETAILS OF REMUNERATION OF DIRECTORS

Disclosure pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014, is annexed herewith as “Annexure D”.

REMUNERATION RECEIVED BY MANAGING / WHOLE TIME DIRECTOR FROM HOLDING OR SUBSIDIARY COMPANY
During the year under review, no Commission or Remuneration was paid to the Executive Directors from Holding / Subsidiary Companies.

DIRECTORS’ RESPONSIBILITY STATEMENT

To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the
following statements in terms of Section 134(3) (c) of the Companies Act, 2013:
(a) that in the preparation of the annual financial statements for the Financial Year ended March 31, 2019, the applicable accounting
standards have been followed along with proper explanation relating to material departures, if any;
(b) that such accounting policies as mentioned in Notes to the Financial Statements have been selected and applied consistently and
judgement and estimates have been made that are reasonable and prudent so as to give a true and fair view of the state of affairs
of the Company as at March 31, 2019 and of the profit of the Company for the year ended on that date;
(c) that proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and
other irregularities;
(d) that the annual financial statements have been prepared on a going concern basis;
(e) that proper internal financial controls were in place and that the financial controls were adequate and operating effectively;

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REPORT OF THE BOARD OF DIRECTORS 3M India Limited

(f) that systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating
effectively.

INTERNAL FINANCIAL CONTROLS AND THEIR ADEQUACY

The Company’s Internal controls is aligned to Global 3M’s internal control over financial reporting which are based on the framework
established by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Controls — Integrated
Framework (2013). The internal controls framework essentially has two elements viz., (1) structures, policies and guidelines designed
to achieve efficiency and effectiveness in operations and compliance with laws and regulations and (2) an assurance function provided
by Internal Audit.
The Directors have laid down internal financial controls to be followed by the Company and such policies and procedures adopted by
the Company for ensuring the orderly and efficient conduct of its business, including adherence to Company’s policies, the safeguarding
of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the
timely preparation of reliable financial information.
The Company has in place adequate systems of internal controls commensurate with its size and the nature of its operations. These
have been designed to provide reasonable assurance with regard to recording and providing reliable financial and operational
information, complying with applicable statutes, safeguarding assets from unauthorized use or losses, executing transactions with
proper authorization and ensuring compliance of corporate policies.
The Company, through its own Corporate Internal Audit Department, carries out periodic audits to cover all the offices, factories and
key areas of business segments based on the plan approved by the Audit Committee and bring out any deviation to internal controls
procedures. The observations arising out of audit are periodically reviewed and compliance ensured. The summary of the Internal
Audit observations and status of the implementation is submitted to the Audit Committee of the Board of Directors. The status of
implementation of the recommendations is reviewed by the Committee on a regular basis and concerns, if any, are reported to the
Board.

DISCLOSURE REGARDING FRAUDS

During the year under review, there were no frauds reported by the Auditor to the Audit Committee or to the Board.

DEPOSITS
During the year under review, the Company has neither accepted nor renewed any deposits from public within the meaning of Section
73 of the Companies Act, 2013 read with the Companies (Acceptance of Deposits) Rules, 2014.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

During the year under review, the Company has not given any Loans, provided any guarantees or made any Investments covered under
Section 186 of the Companies Act, 2013.

RELATED PARTY TRANSACTIONS (RPTs)

All Related Party Transactions (RPTs) which were entered in to, during the financial year were on an arm’s length basis and were in
the ordinary course of business. All RPTs are placed before the Audit Committee for approval. Prior omnibus approval of the Audit
Committee is obtained on a yearly basis for the transactions which are foreseeable and repetitive in nature. A statement exhibiting
details of all actual RPTs versus the approval is placed before the Audit Committee for approval on a quarterly basis. A Policy on RPTs
as approved by the Board is uploaded on the Company’s website at http://solutions.3mindia.co.in/wps/portal/3M/en_IN/about-3M/
information/corporate/financial-facts/summary/.
The Company being a part of 3M conglomerate, has rights to carry out the business within India and accordingly, has access to Group’s
synergies, state of the art products and technologies, competencies and “3M” brand name which are very critical and essential to carry
out its business operations more efficiently in an increasingly globalized and competitive scenario. As a part of its regular business, the
Company purchases, avails/renders services from/to 3M Company, USA and/or its group companies at arm’s length basis.
The RPTs are necessary, normal to business, play a significant role in the Company’s business operations and also form integral part of
the Company’s business. An analysis of all the RPTs entered into / by the Company and the basis of charge was undertaken through a
third-party professional firm.
The Company has already taken approval from the Shareholders for all material RPTs for the estimated/proposed transactions for three
(3) financial years starting from April 1, 2017 to March 31, 2020 at the Annual General Meeting held on August 10, 2017. Form No. AOC-

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REPORT OF THE BOARD OF DIRECTORS 3M India Limited

2 pursuant to Section 134 (3) (h) of the Companies Act, 2013 read with Rule 8(2) of the Companies (Accounts) Rules, 2014 is annexed
herewith as “Annexure E”.

CORPORATE SOCIAL RESPONSIBILITY

As part of its initiatives under Corporate Social Responsibility (CSR), the Company has undertaken projects in the areas of Education,
Community and Environment. These projects are in accordance with Schedule VII to the Companies Act, 2013.
Education:
 School Readiness Program (Anganwadi)
The Company continued to support the School Readiness initiative in partnership with United Way of Bengaluru to transform
Anganwadis under the ICDS program of Government of India to ensure well rounded development of children under the age of
6, to be ready for school. This is a national program covering 130 centers and is improving the lives of over 11,000 children below
the age of 6 years. In its second year of intervention, during FY 2018-19, the program expanded its activities in Anganwadi centers
in 7 cities - Bangalore, Pune, Chennai, Delhi, Kolkata and Ahmedabad and Mumbai. The second year focused on stabilizing the
program at all locations with uniform interventions and project achievements including the development of qualitative aspects
such as learning outcomes and school readiness among children and community mobilization with the mothers’ groups’ active
engagement at Anganwadi centers. This program is working towards achieving the Sustainable Development Goal (SDGs) 4 which
is to ensure inclusive and equitable quality education and promotion of lifelong learning opportunities for all.
 Project NanhiKali: Educating the Girl Child
The Company partnered with K.C. Mahindra Trust to sponsor the education of 2861 girl students from grades 1st to 5th in the
rural district of Ambegaon in Pune, Kolkata and Gurgaon and secondary school students in Noida, Uttar Pradesh. The program
targets first generation learners who attend Academic Support Centers at Government schools where the students improve their
proficiency in English, Maths and the local language. NanhiKalis in secondary school are provided with tablets pre-loaded with
audio-visual educational content to enhance their learning of concepts in Math and English. The program works to ensure that
the NanhiKalis stay in school and improve their learning levels as they continue their education.
 3M-CII Young Innovators Challenge Awards Program
The Company is committed to building a community of young innovators who are at the early stage of launching their next
generation of sustainable solutions to solve key socio-economic problems. The 5th edition of the Young Innovators Challenge in
partnership with the Confederation of Indian Industry (CII) was completed with an all-time high of 500 idea submissions. The four-
stage selection process shortlisted 51 semi-finalists, 19 finalists and 7 winning ideas received grants from the Company to further
their prototypes. The winners were felicitated at the 13th CII India Innovation Summit.
Community:
 Project Pahal: Skill Development of Community Healthcare Workers
In line with the Government’s priorities towards preventive and promotive health, the Company partnered with various
organizations including GE Healthcare and IPE Global to participate in a skilling initiative to empower women community health
workers. 400 women Community Health Workers from the Merry Gold Network were mobilized to participate in a 4-day training
program with curriculum and teaching aids developed by Wipro GE and 3M India. The training batches were conducted in 14
cities and towns across 2 northern states in India – Rajasthan and Uttar Pradesh, over 6 months. The health care workers were
on topics like Hand Hygiene, Wound Management and Cleaning/ Disinfection which were interwoven into the course curriculum.
Members of the Professional Services & sales teams volunteered their time to conduct trainings to 15 batches of 400 community
health workers (including trainers). The Company continued to support Phase 2 of the skilling program which is scaling up to train
up to 6000 Community Health Workers across states such as Orissa, Uttar Pradesh, Rajasthan and Assam.
 3M Young Change Agents for Road Safety Pilot Program
To harness the learning of children at a young age on road safety awareness, the Company embarked on a unique and innovative
initiative to educate children with essential skills to become sensitive, safer road users, by-standers and safe drivers in the future.
Moving away from classroom based, non-interactive program, the 3M Young Change Agents in Road Safety (Y-CARS) was launched
as a pilot program in three schools in Pune. The program was introduced in partnership with the school management through
a combination of workshops, road & road behavior observation and online modules. Through the program, children became
observers of the road safety elements around their school and provided an audit of how safe the school is, through a guided
process. The observations from the children were collated into a School Safe Zone Design which will be implemented through

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road safety improvements by the Company. At the end of this program, children received a certificate while taking a pledge as
Young Change Agents for Road Safety committed to spread the learnings to their families and friends.
 Kerala & Kodagu Flood Rehabilitation Program
During the unprecedented floods that affected several parts of Kerala and Kodagu, the Company responded to the natural
disaster with a rehabilitation program to support the families, especially children who suffered great losses due to the floods.
Needs assessment was carried out at 10 Anganwadi centers in Aluva block, Ernakulam. Scope of work to refurbish these centers
and bring them back to operation for children and families included interiors and exterior improvements, repair works, plumbing
& electrical works, learning materials and mural artwork on the walls.
Sustainability:
 Water Conservation Project at Latur
Water conservation continued to be a strong theme for the Company’s CSR efforts. The Company partnered with FIAT India
Automobiles Private Limited to undertake Water Conservation program “Jalyukt Shivar Abhiyan” in drought-hit villages of Latur
District (Nilanga Tahsil). In this 2nd year of implementation of the project, the Company initiated rainwater harvesting activities
namely – desilting and widening of river tributaries and construction of cement nalla bunds at 7 sites covering 4 villages in Deoni,
Tahsil, Milanga. The entire project involved the development of 25 sites impacting 17 villages.
 Rejuvenation of Lake Singasandra
To address the issue of rapid depletion of water bodies in the city of Bangalore, the Company supported the rejuvenation of one
of the many lakes in the city - Singasandra Lake, situated in Bommanahalli Zone, in Singasandra, Bengaluru and spread over 11
acres. The state of the lake, before the intervention was left wanting in many ways. Lake restoration activities were taken up in
partnership with United Way of Bengaluru and BBPM. The rejuvenation activities included ensuring that the lake was free from
garbage, effluents and other pollutants, thereby restoring water quality and the aquatic species. Solar lamps, benches, waste bins
including e-waste bins have been installed around the lake. Over 5000 bio-diverse saplings (A mix of medicinal species and herbs
such as Vasaka, Nirgundi, Turmeric, Ginger, Lucky, Aloe Vera, Mehandi, etc.) were planted to increase the flora around the lake.
Five full-time gardeners were deployed and are working to maintain the lake environment. Increase in the birdlife visiting the lake
has been observed. To increase community ownership, a lake committee consisting of community members was formed with
engagement activities including a Plog Run (picking up plastic waste as one runs/ jogs), Kannada Rajyotsava, Kere Deepotsava
and tree planting.
The Annual Report on CSR activities is annexed herewith as “Annexure F”.

DETAILS OF REMUNERATION OF EMPLOYEES

Pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5(2) & (3) of the Companies (Appointment and Remuneration
of Managerial Personnel) Rules, 2014, statement showing details of top ten(10) employees in terms of remuneration drawn during the
financial year and other employees of the Company employed throughout the year and employees employed for part of the year who
were in receipt of remuneration of Rs. 1.02 Crores or more per annum and Rs. 80 Lakhs or more per month respectively is annexed
herewith as “Annexure G.”

ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
The Information on Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo stipulated under Section
134 (3) (m) of the Companies Act, 2013 read with Rule 8(3) of The Companies (Accounts) Rules, 2014 is annexed as “Annexure H”.

RISK MANAGEMENT POLICY

The Company has a Risk Management Policy pursuant to the requirements of Listing Regulations. The details of Committee and its
terms of reference are set out in the Corporate Governance Report forming part of the Board’s Report.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

There were no significant and material orders passed during the year by the Regulators / Courts which would impact the going concern
status of the Company and its future operations.

VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Company has an effective vigil mechanism by way of Business Conduct Concern Reporting Policy (Whistle Blower Policy) for
upholding 3M’s Code of Conduct. The details of the said Policy are stated in the Corporate Governance Report and also available on

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the website of the Company http://solutions.3mindia.co.in/wps/portal/3M/en_IN/about-3M/information/corporate/financial-facts/

summary/

STATUTORY AUDITOR
Messrs. BSR & Co. LLP, Chartered Accountants, Bengaluru (ICAI Firm Registration No. 101248W/W-100022) were appointed as the
Statutory Auditor of the Company at the 29th Annual General Meeting held on August 5,2016 to hold office for a period of five (5) years
from the conclusion of the 29th Annual General Meeting till the conclusion of the 34th Annual General Meeting to be held in 2021,
subject to ratification of their appointment by the members at every intervening Annual General Meeting held thereafter.
The requirement of seeking ratification of the members for continuance of their appointment has been withdrawn consequent upon
the changes made by the Companies (Amendment)Act, 2017 with effect from May 7, 2018. Hence the resolution seeking ratification of
the members for their appointment is not being placed at the ensuing Annual General Meeting.

SECRETARIAL AUDIT
Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of
Managerial Personnel) Rules, 2014, the Company appointed Mr. Vijayakrishna K.T, Company Secretary in practice to undertake the
Secretarial Audit of the Company for the financial year 2018-19. The Report of the Secretarial Audit Report is annexed herewith as
“Annexure I”.
SEBI vide its Circular no. CIR/CFD/CMD1/27/2019 dated February 8, 2019 has mandated all the Listed entities having its Equity Shares
Listed on the Stock Exchange(s) to obtain the Annual Secretarial Compliance Report in the prescribed format from a Practising Company
Secretary (PCS) from the financial year ended March 31, 2019 onwards and the Report should be submitted to the concerned Stock
Exchanges within 60 days of the end of the financial year and be included in the Annual Report. The Annual Secretarial Compliance
Report from Mr. Vijayakrishna K.T is annexed herewith as “Annexure I-1” which was filed with the Stock exchanges within the prescribed
time limit.

EXPLANATIONS IN RESPONSE TO AUDITORS’ QUALIFICATIONS

During the year under review, there were no qualifications, reservations or adverse remarks made by the Statutory Auditors / Secretarial
Auditor in their respective Reports.

COMPLIANCE WITH SECRETARIAL STANDARDS

During the year 2018-19, your Company has complied with the applicable Secretarial Standards issued by the Institute of Company
Secretaries of India.

EXTRACT OF ANNUAL RETURN

The details forming part of the extract of the Annual return in Form MGT 9 is annexed as “Annexure K”

DISCLOSURES UNDER THE SEXUAL HARASSMENT OF WOMEN AT THE WORKPLACE (PREVENTION, PROHIBITION & REDRESSAL) ACT,
2013
1. Number of complaints of sexual harassment received in the financial year (April 1, 2018 to March 31, 2019) : 2
2. Number of complaints disposed off during the financial year: 2
3. Number of cases pending for more than 90 days: None
4. Number of workshops or awareness programmes carried out in connection with sexual harassment: 3
5. Remedial measures taken by the Company:
- Counselling by Internal Committee to both the parties on professional code of conduct. Warning letter given to respondent.
- Leadership behavior implication for respondent and roles change for respondent to prevent interaction with each other.
- Respondent (contingent worker) was not deputed on 3M premises and the contract agency was briefed on the same.
Counselling given to the complainant.

HUMAN RESOURCES
During the financial year, the Company took many initiatives to increase organizational capability and productivity to be value driven
and future-ready. As at March 31, 2019, the Company had employee strength of 1377 personnel.

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COST AUDIT
Pursuant to Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Rules, 2014, the cost audit
records maintained by the Company in respect of the products covered under the said rules are required to be audited by a Cost
Accountant. Accordingly, the Board of Directors of the Company at its Meeting held on May 28, 2019 on the recommendation of the
Audit Committee, approved re-appointment of Messrs. Rao, Murthy & Associates, Cost Accountants, Bengaluru, (holding Registration
No. 000065), to conduct the audit of the cost records of the Company for the financial year ended March 31, 2020 on a remuneration
of Rs. 475,000/- plus taxes as applicable and out of pocket expenses at actuals. The Audit Committee has also received a certificate from
the Cost Auditor certifying their independence and arm’s length relationship with the Company.
As required under the Companies Act, 2013, the remuneration payable to the Cost Auditor is required to be placed before the Members
at the General Meeting for their ratification. Accordingly, a resolution seeking ratification of the remuneration payable to Messrs. Rao,
Murthy & Associates, Cost Accountants, Bengaluru is included in the Notice convening the Annual General Meeting.
Disclosure on Cost Audit: For the financial year ending March 31, 2018, the due date of filing the Cost Audit Report submitted by
Messrs. Rao, Murthy & Associates, Cost Accountants, Bengaluru, was September 27, 2018 and the same was filed with the Ministry of
Corporate Affairs on August 23, 2018 vide SRN H03455847.

OTHER DISCLOSURES
During the year under review, the Company:
a. has not bought its own shares nor has given any loan to the employees (including KMPs) of the Company for purchase of the
Company shares, and,
b. has not issued any shares to trustees for benefit of employees.

ENVIRONMENT, HEALTH AND SAFETY

Global health and safety issues are prevalent in workplaces around the world. Creative innovation, technology, education, and
collaboration are all critical if we are to tackle these human health and workplace safety concerns.
For decades, 3M has had entire business divisions focused on creating products and services for human health, protection, security, and
safety. The Company is committed to helping improve the health and safety of people world-wide.
The Company also embraces this commitment for its own operations, and to that end, will continue to take steps to protect the most
important asset – 3M employees.
Environment:
The Company has three (3) Manufacturing Plants in operation in India and all three plants have Environmental Management Systems
certified to new ISO 14001: 2015 standard.
Your Company’s Management is continuing to step up the leadership towards a more sustainable in its own operations, and in solutions
for the customers. Sustainability is at the core of what the Management does at 3M and is committed to improving the business, the
planet and every life.
3M’s strategies for sustainable development encompass the pursuit of customer satisfaction and commercial success within a
framework of environmental, social, and economic values. The Company is committed to complying with all applicable environmental
requirements worldwide. Beyond compliance, the Company continues to make significant investments to reduce the environmental
footprint of our operations; and the products with sustainable attributes help customers reduce their environmental footprint and
help to meet their Sustainability goals. Always, 3M believes environmental policy and regulations should be guided by science-based
decision making.
Sustainability Goals which the Company is now pursuing reflect a heightened commitment to going beyond compliance and thinking
holistically about how the operations and products affect the world and every life in it. For the 18th consecutive year, 3M was selected
as a member of the Dow Jones Sustainability Index, a global stock index that recognizes and tracks the performance of leading
Sustainability-driven companies worldwide. And 3M India Plants are contributing and meeting the targets of this global goals.
Sustainability target for the Manufacturing plants were to reduce the Waste, Water and Energy with respect to 2015 Baseline numbers:
- Waste generation reduction by 20.91%
- Water consumption reduced by 57.01%
- Energy Consumption reduced by 28.11%

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- Also 2 of the manufacturing plants are utilizing 24% share of its energy consumption through renewable energy.
- Waste generated at Plants is majorly sent for co processing in cement kilns thereby reducing the carbon footprint of the sites.
All plants have sewage / waste water treatment plants and the treated water is recycled for cooling tower make and horticulture with
in the facilities. The plants have also installed rain water harvesting systems to divert the rain water for ground water recharging. With
the approval from local Pollution Control Boards, plants continued sending non-hazardous waste to cement companies to generate
energy. As part of World Environmental day initiative, the plants have taken up various environmental awareness programs including
tree plantation in plants as well as public location.
Health and Safety:
The Company continues to reinforce our commitment to leadership in safety and health. All three manufacturing plants have health
and safety management systems certified to OHSAS 18001: 2007. Your Company continues to forge ahead with our commitment to
leadership in safety and health. Like in the prior year, 3M Corporation recognized two of our manufacturing facilities - Ranjangaon and
Electronics city plants, with the highest award for safety excellence – The CEO Award, for consistently upholding safety standards.
Your Company strongly believe that, Safety starts with every individual, while the behavior of every individual defines the culture of the
organization.
 All accidents and injuries are preventable
 Everyone in organization is accountable for the safety performance
Safety and Health metrics are driven rigorously through tier level meetings which starts with Safety observations. Each plant has
qualified Safety Officer and the representation of Employees at Plant safety committees includes both management and shop-floor
employees and the meetings are chaired by the Plant manager. The High hazard activities (HHA) which are carried out at sites are
driven through Risk and Prioritization (RAP) review approach. Hierarchy of controls focus firstly on elimination of the hazard followed by
substitution, engineering controls and finally PPE with management along with management oversight and STOP work initiates ensures
the employees perform the job in the safest possible manner. In addition to EHS risk analysis, the Company has a crisis plan for every
single 3M plant. Although the Company never hopes to use the Crisis Management Plans, it is critically important that the Company has
them in place, keep them up to date, and drill often to make sure everyone understands what to do should an emergency occur. The
Company cares utmost about the safety of our people and communities around the world
The 3M Global Safety and Health Plan (GSHP), which is part of 3M’s Environmental, Health, and Safety (EHS) management system, is
required to be implemented by global 3M locations. This approach utilizes a well-developed self-assessment process that is categorized
into multiple elements addressing various areas and standards related to safety and health. 3M utilizes a variety of tools to manage
risks from hazards in the workplace. The Company used specialized tools successfully for several years in the areas of process safety,
industrial hygiene, and ergonomics. Each of these disciplines uses a risk management approach to categorize hazard levels and define
appropriate levels of control.
The other EHS framework programs which 3M follows are Ergonomics, Industrial hygiene, Process hazard management (PHM),
Ventilation programs, Static Management plan, Safety trainings, Health and Wellness Programs which enables us to ensure better and
safe work environment to all the employees.
All these efforts translate into the EHS metrics being achieved and notably there has been no Lost Time injuries at any of the three
manufacturing sites during this period under consideration.
The Company has led with passion and shared its expertise with the communities, through school outreach, activities with its employees’
children and several awareness programs with the customers.
Supported by 3M’s highly credentialed Technical trainers, the Company has partnered with industrial facilities across India to drive safety
and build confidence amongst the end users through “Safety on Wheels” trucks. This program also offers various training sessions that
would include a various Personal Protection Equipment (PPE) demonstrations (through hands on and Videos) on a variety of safety
topics.
The Safety on Wheels which also known as Audhyogik Suraksha Rath targets to train over 1 million workers over next 3 years to build
awareness and training about safety practices and personal protective equipment and to spread the word about the importance of
worker safety across the nation. The Audhyogik Suraksha Rath have travelled across industrial clusters in the country educating more
than 95,000 workers on the importance of workplace safety.

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AWARDS AND RECOGNITION

• The Company was recognized by Outlook Business Outperformers, a listing by Outlook Business publication, of companies that
have consistently delivered high performance. 3M India Limited was recognized for the 2nd consecutive year for stock return over
Sensex over the last 5 years.
• The Company was amongst the Top 10 Companies in India by Earnings Per Share (EPS) trailing 12 months as per a compilation by
MoneyControl.com.
• Your Company was recognized as amongst Forbes India’s Super 50 Companies of 2017 for overall performance.
• The Company’s Managing Director, Ms. Debarati Sen featured in Fortune India’s annual list of Top 50 Powerful Women in Business
for her leadership in strengthening 3M’s position and brand in India.
• 3M Car Care was awarded Franchisor of the Year Award – Consumer Services for 2018 by Franchise Awards.
• The Company’s manufacturing facility at Ranjangaon was awarded the Gold Award for Manufacturing Excellence by Frost & Sullivan
• The Company was recognized for Lean Six Sigma excellence at the CII 12th National Six Sigma Competition. Two projects presented
under Transaction process and Discrete process categories respectively received special recognition.
• The Company’s senior women leaders were recognized for Business Leadership among Women at the Future Woman Leader
Summit & Awards 2018.
• The Company was recognized for overall performance in the areas of quality, cost, delivery, innovation by top customers in the
automotive, utilities and construction sectors.
• The Company’s manufacturing facility at Electronics city received 3M Corporate recognition for Quality achievement. This was the
Company’s 7th consecutive Corporate 3M recognition for Quality.
• The Company also received several accolades for excellence in lean six sigma, marketing, innovation and various support functions
with several 3M Corporate and regional level awards.

ACKNOWLEDGEMENT
Your Directors thank and acknowledge with gratitude the co-operation, assistance and support received from the Central Government,
State Governments of Karnataka, Maharashtra and Gujarat, Bankers, Shareholders, Dealers, Vendors, Promoters of the Company and
all other Stake holders.
The Directors also wish to place on record their sincere appreciation and gratitude towards the contribution made by every employee
of the Company.
On behalf of the Board of Directors
Debarati Sen B.V. Shankaranarayana Rao
Place : Bengaluru Managing Director Whole-time Director
Date : May 28, 2019 DIN: 07521172 DIN: 00044840

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MANAGEMENT DISCUSSION AND ANALYSIS REPORT

Cautionary Statement:
Members and Investors are cautioned that the discussion in this section of the Annual Report may contain statements that involve
risks and uncertainties. Forward-looking statements mentioned may involve risks and uncertainties that could cause results to differ
materially from those projected. Consequently, actual results, performance or achievements could thus differ materially from those
projected in any such forward looking statements. The Company cannot guarantee that these assumptions and expectations are
accurate or will be realized. The Company assumes no obligation to update or revise any forward-looking statements. Forward-looking
statements are based on certain assumptions and expectations of future events and trends that are subject to risks and uncertainties.
Actual future results and trends may differ materially from historical results or those reflected in any such forward-looking statements
depending on a variety of factors.

THE COMPANY
The Company is the flagship listed Company of 3M Company, USA in India. 3M Company, USA holds 74.99% equity stake in the
Company and is a diversified technology and science Company with a global presence in the following businesses: Industrial; Health
Care; Consumer; Safety and Graphics; and Energy and is among the leading manufacturers of products for many of the markets it
serves. Most of its products involve expertise in technology, product development, manufacturing and marketing, and are subject to
competition from products manufactured and sold by other technologically oriented companies.
The Company has manufacturing facilities in India at Ahmedabad, Bengaluru, Pune and has the Corporate Office and Customer
Innovation Center (R&D Center) in Bengaluru. As at March 31, 2019, the Company had employee strength of 1377 personnel. The
Company managed its operations in five (5) operating business segments: Industrial; Health Care; Consumer; Safety and Graphics; and
Energy. The Company’s five business segments bring together common or related 3M technologies, enhancing the development of
innovative products and services and providing for efficient sharing of business resources.
3M products are sold through numerous distribution channels, including directly to users via wholesalers, retailers, converters,
distributors and dealers in a wide variety of trades in many countries around the world. The Management of the Company believes
that the confidence of wholesalers, retailers, converters, distributors and dealers of 3M and its products has been developed through
long association skilled marketing & sales teams and this confidence has contributed significantly to 3M India’s growth and its position
in the marketplace.

Global Economic Overview

Global economy continues to moderate as the recovery in trade and manufacturing activity loses steam. Trade tensions continue to
stay elevated. Borrowing costs for emerging markets & developing economies have increased. A strengthening US dollar heightened
financial market volatility. Fluctuating energy prices have led to global growth contracting to 3.0% in 2018 vs 3.1% the year before. The
Global economy is expected to further contract to 2.9% in 2019 with bulk of the growth coming in from Asian markets.

India Economic Overview

India economy grew 7.2% in 2018 and is expected to grow at 7% in 2019. Growth is led by consumption & investment. India is expected
to continue growing at 6.5-7% over next 5+ years. Manufacturing & Automotive sectors are in the midst of severe headwinds. However,
Consumer, Health Care, Infra markets are performing strongly. India IIP was pegged at 5.2% in 2018. 2019 is seeing the IIP go down to
4.4%. Core Sector slow down, followed by falling prices is a concern in the near term. Inflation has been hovering around the 2-3% mark
– well below the RBI mandate of 4-5%

Some of the key trends in the market are;

 Continued consumption trend: With the increasing income in the middle class, we are also seeing a larger use of life style products
with Indian consumers.
 Increased focus on sustainability: We are seeing a rising focus in the government as well as greater awareness among consumers on
green consumption practices, air & water quality, reducing the carbon footprint & single use plastics, etc.
 Emerging digital go-to-market-models: Ecommerce and digital go-to-market strategies are helping companies better target their
customers, make themselves more relevant and also expand their reach more efficiently into Tier II & III towns.
 Increased FDI in India: Several industries have benefitted from initiatives like the Make in India campaign, especially Electronics,
Automobiles, Defence and SME sectors. Increased manufacturing in India is also helping improve the Tier I and Tier II supply market
in India.

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 Increased spending on urban infrastructure: City Infrastructure will continue to stay in focus to meet the needs of rapid urbanization
and quality of life
 National Health Care: The Govt has taken several measure towards providing quality healthcare access to all citizens. Although
initial days, the policy will see its maturing over the coming months before the healthcare dream is realized.

RESULTS OF THE OPERATIONS OF THE COMPANY

The Company on a standalone basis registered an overall turnover growth of 8.85% at Rs. 280,875.97 Lakhs for the financial year
ended March 31, 2019 compared to Rs. 258,039.60 Lakhs in the previous financial year. The Profit before Interest and Depreciation
is Rs. 54,042.78 Lakhs compared to Rs. 52,342.69 for the previous financial year. Profit before Tax is Rs. 49,745.93 Lakhs compared to
Rs. 47,968.30 Lakhs for the previous financial year. The operating margin for the current year is 19.02% compared to 19.95% for the
previous financial year. Total Comprehensive Income is Rs. 32,286.31 Lakhs compared to Rs. 31,027.31 Lakhs for the previous financial
year. Portfolio prioritization, operational productivity and lower material costs increased the profitability at all levels for the financial
year under review. Export Sales is Rs. 2,696.81 Lakhs for the financial year ended March 31, 2019 compared to Rs. 1,627.92 Lakhs in the
previous financial year, an increase of 65.66%, due to increase in demand in global market.

Other Income:
The other income is Rs. 3,283.16 Lakhs for the financial year 2018-19 compared to Rs. 4,361.54 Lakhs for the previous financial year
2017-18.

Cost of Goods sold:

The % of cost of raw material consumed as against sales for the financial year 2018-19 is higher by 0.66% at 52.32% as against 51.66%
for the previous financial year 2017-18, due to product mix and increase in foreign currency exchange rate.

Employee Benefits Expense:

Employee cost as a % of sales for the year 2018-19 stood at 10.59 % (previous financial year was 12.35%) at Rs. 30,106.15 Lakhs
(previous financial year: Rs. 32,407.88 Lakhs). Sales per employee have improved by 7.19% to Rs.206.36 Lakhs (no. of employee’s 1,377)
in the current financial year 2018-19 from Rs. 192.52 Lakhs (no. of employees 1,363) for the previous financial year 2017-18.

Finance Cost:
The interest cost for the financial year 2018-19 is Rs.109.18 Lakhs compared to Rs. 194.07 Lakhs in the previous financial year 2017-18.
The interest cost is on account of lease rentals of vehicles and office equipment.

Interest earned:
The Company earned Rs. 2,685.21 Lakhs on the surplus during the financial year 2018-19 when compared to Rs. 3,585.56 Lakhs during
the financial year 2017-18 by keeping the funds in deposits with the Banks.

Earnings per Share (EPS):

The EPS (Basic and Diluted) of the Company for the financial year 2018-19 was Rs. 286.72 per share as compared to Rs. 275.66 per share
in the previous financial year, a growth of 4.01%.

Share Capital:
The Authorized/Issued/Subscribed and Paid-up Capital as at March 31, 2019 is Rs. 11,26,50,700 (divided into 1,12,65,070 equity shares
of Rs. 10 each). During the year under review, the Company has not issued shares with differential voting rights nor granted stock
options nor sweat equity.

Reserves & Surplus:

Entire profit of Rs. 32,286.31 Lakhs is retained in profit and loss account for the year ended March 31, 2019. The Reserves & Surplus is
Rs. 184,826.52 Lakhs including the current financial year retained profit.

Shareholder’s Fund:
The total shareholder funds increased to Rs. 185,953.03 Lakhs as at March 31, 2019 from Rs. 153,666.72 Lakhs as of the previous
financial year 2017-18 end, representing a growth of 21.01% mainly because of retained profits of the current year.

Depreciation:
The depreciation charge for the current year is higher at Rs. 4,187.67 Lakhs as against a charge of Rs. 4,180.32 Lakhs of previous financial
year 2017-18 due to new investments.

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Fixed Assets-Capital Expenditure:

The gross Fixed Assets as at March 31, 2019 was Rs. 43,145.90 Lakhs as compared to Rs. 41,093.61 Lakhs of previous financial year
2017-18. Capital Investments during the year 2018-19 were at Rs. 3,084.21 Lakhs (Net of capital work-in-progress and capital advances)
(2017-18: Rs. 1,641.10 Lakhs) an increase of 87.93% year on year.

Inventories:
Inventory as at March 31, 2019 amounted to Rs. 37,918.19 Lakhs as against Rs. 34,728.93 Lakhs of previous financial year 2017-18. The
inventory ratio has decreased to 89 days as at March 31, 2019 from 91 days of previous financial year 2017-18.

Trade Receivables:
Trade Receivables as at March 31, 2019 amounted to Rs. 54,613.88 Lakhs as against Rs. 52,963.65 Lakhs of previous financial year 2017-
18. The debtor’s turnover ratio is 70 days (previous financial year: 66 days).

Cash and Bank balances:

The total balance of cash and bank balances as at March 31, 2019 was Rs. 47,039.04 Lakhs as compared to Rs. 78,931.24 Lakhs as at
March 31, 2018.

Current Ratio: 2.48

Debt Equity Ratio: 0.73%
Overall analysis of the profit and loss (Standalone):

Year Ended March 31, 2019 Year Ended March 31, 2018
Particulars
Rs. in Lakhs % Rs. in Lakhs %

Revenue from operations 280,875.97 98.84 258,039.60 98.34

Other income, net 3,283.16 1.16 4,361.54 1.66

Total Revenue 284,159.13 100.00 262,401.14 100.00

Cost of Materials consumed 86,741.34 30.53 81,163.29 30.93

Purchases of stock-in-trade 63,315.23 22.28 53,970.94 20.57

Changes in inventories of finished goods, work-in-progress and

(1,387.67) (0.49) (1,999.10) (0.76)
stock-in –trade

Excise Duty 0.00 0.00 2,425.88 0.92

Employee benefits expense 30,106.15 10.59 32,407.88 12.35

Other Expenses 51,341.30 18.07 42,089.56 16.04

Profit before Finance costs and Depreciation 54,042.78 19.02 52,342.69 19.95

Finance Costs 109.18 0.04 194.07 0.07

Depreciation and amortization expense 4,187.67 1.47 4,180.32 1.59

Total Expenditure 234,413.20 82.49 214,432.84 81.72

Profit before Tax 49,745.93 17.51 47,968.30 18.28

Tax 17,446.85 6.14 16,914.74 6.45

Profit for the year 32,299.08 11.37 31,053.56 11.83

Items that will not be reclassified subsequently to profit or loss (12.77) (0.01) (26.25) (0.01)

Total comprehensive income for the year 32,286.31 11.36 31,027.31 11.82

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Segment wise performance:

The Industrial business grew by 4.90%; Health Care business grew by 6.60%: Safety and Graphics business grew by 7.91%; Consumer
business grew by 11.22% and Energy business grew by 36.01%.

(A) INDUSTRIAL BUSINESS:

The Industrial segment serves a broad range of markets, such as automotive original equipment manufacturer (OEM) and
automotive aftermarket (auto body shops and retail), electronics, appliance, paper and printing, packaging, food and beverage,
and construction. Industrial products include tapes, a wide variety of coated, non-woven and bonded abrasives, adhesives,
advanced ceramics, sealants, specialty materials, closure systems for personal hygiene products, acoustic systems products, and
components and products that are used in the manufacture, repair and maintenance of automotive, marine, aircraft and specialty
vehicles. Major industrial products include vinyl, polyester, foil and specialty industrial tapes and adhesives; Scotch® Masking Tape,
Scotch® Filament Tape and Scotch® Packaging Tape; packaging equipment; 3M™ VHB™ Bonding Tapes; conductive, low surface
energy, sealants, hot melt, spray and structural adhesives; reclosable fasteners; label materials for durable goods; and coated,
nonwoven and microstructured surface finishing and grinding abrasives for the industrial market. Other industrial products include
fluoroelastomers for seals, tubes and gaskets in engines.

Major transportation products include insulation components, including Thinsulate™ Acoustic Insulation and components for
catalytic converters; functional and decorative graphics; abrasion-resistant films; adhesives; sealants; masking tapes; fasteners
and tapes for attaching nameplates, trim, moldings, interior panels and carpeting; coated, nonwoven and microstructured
finishing and grinding abrasives; structural adhesives; and other specialty materials. In addition, 3M provides paint finishing and
detailing products, including a complete system of cleaners, dressings, polishes, waxes and other products.

Rs. in lakhs

12 Months Ended 12 Months Ended

31.03.19 31.03.18
Segment Revenue 112,756.90 107,493.27
Financial Highlights Profit Before Interest & Tax 19,540.02 19,917.21
Capital Employed 33,939.14 31,733.44

Highlights • Automotive & Aerospace division had a turbulent year marked by automotive build slowdown
across PV & 2W segments and rising dealership inventories because of change in regulations
(Emissions & ABS), rising interest rates, insurance and fuel costs and natural calamities like the
floods in Kerala and Kodagu.
• The OEM segments (Autocare and Collision Repair) of Automotive Aftermarket Division saw a
healthy growth primarily due to new product sales and new customer acquisitions despite the
challenges faced because of passenger car sales slow-down.
• Industrial Adhesive and Tapes Division continued their focus on Passive Fire Portfolio, driving
relevance in Construction and strengthened Converter Business Model, increasing penetration
in Transportation & Metal working market.
• The Abrasive Systems Division have reached out to more end customers with their productivity
improvement solutions which has reduced lead times, improved output quality, controlled cost
per component etc., spanning sectors like Automotive, Auto Comp., Metal Fabrication, Cutting
tools, Gear grinding, Aerospace, Windmill segments etc. The Sales team has been equipped
with digital tools (3M Sales Aid) to prove & implement Value added processes for productivity
improvement.
• The Company gained share in the Advanced Materials markets with its differentiated offerings
from polymer solutions like Polymer Processing Additives for packaging industry, Engineered
Specialty Additives for oil and gas industry and friction shims for automotive industry from its
ceramics portfolio.
• Industrial & Safety Market Center made significant strides in the year by driving channel sales
growth through a sharp focus on Key Accounts & Long-Tail customers.

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(B) HEALTH CARE BUSINESS:

Our Health Care business segment serves markets that include large multi-specialty hospitals and small clinics, dental and
orthodontic practitioners, processed food manufacturers and pharmaceutical companies. Our offerings include medical and
surgical supplies, medical devices, skin & wound care and infection prevention products & solutions, drug delivery systems, dental
and orthodontic products and food safety products.
Rs. in lakhs
12 Months Ended 12 Months Ended
31.03.19 31.03.18
Financial Highlights Segment Revenue 42,705.35 40,062.92
Profit Before Interest & Tax 8,429.73 7,779.21
Capital Employed 10,474.82 14,591.74
Highlights • 3M Healthcare continues to help emerging hospitals adhere to standards and guidelines that
enable them to get accreditation and certification to meet NABH standards with a seamless, cost
effective and end-to-end solution.
• Focused Market development through an online education platform with local and regional
content to drive market expansion and demand generation.
• 3M Healthcare has been continuing efforts in digital space. Sales through e-commerce for both
medical and dental products have gained traction and we are seeing continued year on year
growth.
• Improving coverage efficiency through restructured organization structure.

(C) SAFETY AND GRAPHICS BUSINESS:

The Safety & Graphics business serves a broad range of markets that serve to increase the safety, security & productivity of people
& improves facility design, aesthetics, hygiene, etc. Major product offerings include personal protection products; traffic safety
& security products, border security solutions; public safety & identity management solutions; commercial graphics sheeting &
systems; architectural surface & lighting solutions; cleaning & protection products for commercial establishments, etc
Personal protection products include maintenance-free & reusable respirators, personal protective equipment, head & face
protection, body protection, hearing protection & protective eyewear. In traffic safety & security, 3M provides reflective sheeting
used on highway signs, vehicle license plates, construction work-zone devices, pavement marking systems, electronic surveillance
products, films that protect against counterfeiting & reflective materials that are widely used on apparel, footwear & accessories,
enhancing visibility in low-light situations. Traffic safety & security also provides remote people-monitoring technologies used for
offender-monitoring applications. The portfolio also includes RFID tracking technologies & Automatic Number Plate Recognition
(ANPR). Major commercial graphics products include films, inks, digital signage systems & related products used to produce
graphics for vehicles, signs & interior surfaces. Other products include spill-control sorbents; nonwoven abrasive materials for
floor maintenance & commercial cleaning; floor matting, housekeeping chemicals, etc.
Rs. in lakhs
12 Months Ended 12 Months Ended
31.03.19 31.03.18
Financial Highlights Segment Revenue 71,318.68 66,091.17
Profit Before Interest & Tax 8,808.37 8,507.45
Capital Employed 26,976.29 20,589.21
Highlights • Government continues its efforts to invest heavily in transport infrastructure, specifically - National
Highways, Expressways, Rural roads and several Industrial corridors. However, the Indian roads
are not considered very safe as we contribute to almost 10% of global fatalities. Transportation
Safety Division has been working closely with all stakeholders to reverse this trend. The division
continues its growth path in the road safety space with many of its technological products such
as Signages & Roadway materials using retro-reflective technology – Overhead signs, Cautionary
& mandatory signs, Vehicle Marking Tapes, Solar RPMs, Flexible median markers, Delineators,
Road pavement markers, etc. help promote safety on the Indian roads. The division continues to
invest heavily in education & awareness of several road safety solutions to key stake holders by
way of night demos, training programs including participation in both domestic and International
trade shows.

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Highlights
• Significant penetration has been made with cutting edge solutions for Smart Cities in the areas
of urban mobility with Smart Variable Message Signs. The Smart Variable Message Signs provide
real time, contextual & automated information to motorists & allow a host of smart sensors
to be integrated into a single platform allowing better information dissemination, disaster
management & traffic enforcement.
• Personal Safety Division continues to drive education on the proper selection and usage of
Personal Protection Equipment across all segments requiring attention for occupational health
and safety. Pharmaceutical, Automotive, General Engineering and Chemical and several other
sectors provide an opportunity for significant growth to the division. The division continues to
increase its penetration into the SME segment through various awareness and contact programs
and other onsite SME activation Programs. Division’s launch of Fall Protection products, Self-
Contained Breathing Apparatus and other products provide further opportunity for growth with
newer segments like Fire services.
• In a bid to raise awareness among the Labour force on the importance of safety measures and
proper equipment in the workplace, the Audhyogik Suraksha Rath (mobile industrial safety
training van, in association with the Directorate General, Factory Advice Service & Labour
Institutes (DGFASLI), Ministry of Labour and Employment) has so far trained close to 1 Lac
Workers and visited close to 700 Industries. Over the next three years, the vans will cover one
million industrial workers, raising awareness on industrial safety and health through training
programs with the message: Safety First.
• One of the major causes of deaths is falling from heights, and to train and raise awareness 3M
has also launched 2 dedicated Training Vehicles for training workers on Fall Protection.
• The division has signed an MOU with the Chest Foundation of India to establish a mutual
collaboration that seeks to explore opportunities and provide awareness programs to the
medical professionals in India.
• Our Personal Safety Division also made significant contributions through awareness building and
helping citizens get appropriate respirators during air quality concerns in several cities during the
winter months.
• Commercial Solutions Division (CSD) through their graphics and architectural market portfolios
and cleaning workplace safety portfolio is focused on bringing change to every brand and every
customer by creating unique “Brand experience” with the visual impact that it creates with its
products and services. Several segments such as Retail, Banking, Hospitality, Railways, Metro rail,
Airports, Commercial Offices, IT and ITES, Hotel, Restaurant and Catering (HORECA), Oil and Gas
etc., found several solutions from Commercial Solutions division which helped them create a
unique brand experience for their consumers. Some of the big brands of our country have gone
ahead in refreshing their brand logo and outlet appearances in recent quarters which seen usage
of CSD solutions.
• Right from graphics to cleaning and work place solutions, this division is trying to touch every life.
The division saw a lot of success in retail & office refurbishment, railway new trains & interior
refresh, car personalization and styling along with new projects of outlet expansion banking and
oil & gas segments.
• CSD has also seen growth from geographical penetration to new territories and expansion of
graphics manufacturers network across growing cities. Division continues to focus and invest
heavily in training and educating end customers, dealers, applicators, graphics manufacturers
through series of expertise delivery programs in these growing cities.

(D) CONSUMER BUSINESS:

The Consumer segment serves markets that include consumer retail, modern trade, office retail and other emerging retail
channels. The products in this segment include office supply products, stationery products, home care products and protective
material products. Major consumer products include Scotch® brand products, such as Scotch® Magic™ Tape and Scotch® Glue
Stick; Post-it® Products, such as Post-it® Flags, Post-it® Note Pads and Dispensers; home care products, including Scotch-Brite®
Scour Pads, Scotch-Brite® Scrub Sponges, Scotch-Brite™ Microfiber Cloth products.

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Rs. in lakhs
12 Months Ended 12 Months Ended
31.03.19 31.03.18
Financial Highlights Segment Revenue 30,348.57 27,286.70
Profit Before Interest & Tax 5,510.35 4,796.84
Capital Employed 9,213.61 9,518.49
Highlights • Focus on driving scouring business with new product launch of Silver Sparks and multi-pack drive
in Modern Trade.
• Launch of Command® range of products in Modern Trade.
• Launch of innovative products like Scotch-Brite Broom, Microfiber cloth and a range of household
tapes including wall-safe tapes and student tape.
• Focus on Air Quality products like respirators and AC Filters to address the air quality issues that
Indian consumers face both in outdoor and indoor.
• Continued growth in the office supplies channels with Post-it & Scotch range of products aimed
at office workforce segment.
• Accelerated growth in Modern Trade by partnering with Key Modern Trade customers for
categories in Home Care, Stationery and Command range of products.
• Distribution expansion program aimed at increasing availability of Home Care range of products
in Tier B&C towns through partnership with wholesalers across the country.
• Partnered with adjacent category & household brands for cross promotional activities thereby
expanding household reach for our products.
• Continued investment in the brands viz “Scotch-Brite®”, Post-It®, Scotch® and Command®
through various brand building activities in Mass Media, Digital Media and in Point of Sales.
• Accelerated sales through ecommerce channel with focus on product portfolio, good digital
content and on-line demand generation programs.

(E) ENERGY BUSINESS:

Infrastructure Protection Products Division of 3M offers a comprehensive array of products that ensure effective protection against
corrosion for a variety of installations and structures. While 3M™ Scotchkote™ Fusion Bonded Epoxy Powders and Scotchkote™
Liquid Epoxy Coatings offer protection for steel pipelines, associated fittings and structures used in the oil, gas, water, industrial
and construction markets, the range of 3M™ Scotchcast™ Powder Resins are ideal for OEM electrical insulation applications.
3M Dynatel Locators combine simple interfaces, large backlit high-resolution graphics, excellent balance and ergonomics with
precision locating capabilities to quickly and accurately identify underground assets.
In Renewable Energy 3M is helping to transform the fields of Generation & Conservation of Energy. 3M supports solar & wind
energy initiatives through product solutions such as films, tapes, coatings, encapsulants and adhesives that help reduce the cost of
energy generation. For energy conservation and management needs of customers we provide affordable window film technology
that ensures effective health and environment protection.
Rs. in lakhs
12 Months Ended 12 Months Ended
31.03.19 31.03.18
Financial Highlights Segment Revenue 21,051.37 15,477.61
Profit Before Interest & Tax 3,735.95 2,354.96
Capital Employed 1,945.05 4,874.57
Highlights • The corrosion protection business had a strong year because of execution of large oil& gas and
water pipeline projects.
• The year witnessed a strong growth of 3M locator and marker sales as they were used for asset
management while implementation of telecom projects.

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OPPORTUNITIES AND THREATS

3M’s globally competitive cost positions and well-crafted business strategies have enabled it to retain its leading market positions. Your
Company strongly believes in the 3M™ brand equity and its ability to provide its customers with innovative solutions. Global campaigns
and brand building continue to benefit our business in India.
The Company is operating in a highly competitive market which may exert pressure both on the top line as well as the bottom line of
the Company. The Company’s products involve expertise in product development, manufacturing and marketing and are subject to
competition from products manufactured and sold by other technologically oriented companies both within India and outside India. In
addition, rupee depreciation, fluctuating oil & high commodity prices remain key challenges needing focused attention.

RISKS AND CONCERNS

Provided below are cautionary statements of what we believe to be the most important risk factors applicable to the Company.
External market headwinds specifically in manufacturing, automotive and infrastructure.
• The impact of increase in duties on the products of the Company and consequent increase in the cost of goods sold.
• The Company’s results are affected by competitive conditions and changes in customer preferences.
• The Company’s growth objectives are largely dependent on the timing and market acceptance of its new product offerings, including
its ability to continually renew its pipeline of new products and to bring those products to market.
• Prices of inputs are expected to rise significantly. Whilst the Company continues to pursue cost reduction initiatives, increase in price
of input materials and rupee depreciation could impact the Company’s profitability to the extent that the same are not absorbed by
the market through price increases and/or could have a negative impact on the demand in the domestic market.
• The operations are subject to risk arising from fluctuations in exchange rates with reference to currencies in which the Company
transacts.
• The Company’s future results may be affected if the Company generates fewer productivity improvements than estimated. The
outcome of contingencies, such as legal and regulatory proceedings.
• The effects of changes in tax, and other laws and regulations and market uncertainties.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

All key functions and divisions of the Company are independently responsible to monitor risks associated with in their respective
areas of operations such as production, supply chain, marketing, finance, accounting, treasury, legal and other areas like health, safety
and environment. The Company has identified various risks through an internal self-assessment compliance checklist and has laid out
necessary procedures to mitigate the same.
The Company has in place adequate systems of internal control commensurate with its size and the nature of its operations. These have
been designed to provide reasonable assurance with regard to recording and providing reliable financial and operational information,
complying with applicable statutes, safeguarding assets from unauthorized use or losses, executing transactions with proper
authorization and ensuring compliance of corporate policies. The Company, through its own Corporate Internal Audit Department,
carries out periodic audits to cover all the offices, factories and key areas of business segments based on the plan approved by the Audit
Committee and bring out any deviation to internal control procedures. The Internal Auditor functionally reports to the Audit Committee
and administratively to the Managing Director. The observations arising out of audit are periodically reviewed and compliance ensured.
The summary of the Internal Audit observations and status of the implementation is submitted to the Audit Committee of the Board
of Directors. The status of implementation of the recommendations is reviewed by the Committee on a regular basis and concerns, if
any, are reported to the Board.

DEVELOPMENTS IN HUMAN RESOURCES / INDUSTRIAL RELATIONS

Talent Development:
In the year 2018, the Company further strengthened our development framework involving learning for Supervisors, Hi Potentials and
Employees.
For the people leaders, the Company has put in place a workshop series called ‘India People Leader Journeys’ with a curriculum for
supervisors based on their roles and experience levels. The workshop series for New Leaders, Evolving Leaders and Experienced leaders
is a blend of content that enables supervisors to be better equipped to lead people in today’s environment, while also keeping in mind
global 3M priorities. Some highlights were programs called ‘Your Leadership Experience’ and ‘Insights Discovery’ for our experienced

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leaders. Nearly 115 of our supervisors across regions were part of workshops which we believe will be a powerful input to their
leadership journeys.

‘Arts-An Inspiration for Excellence’ was another initiative launched to help our leaders learn from excellence in diverse fields. The
Company had the honour of hosting and learning from talks by theatre doyen Ms. Arundhati Nag and award-winning danseuse, Ms.
Malavika Sarukkai as part of our learning programs.

In addition to Spark, 3M’s learning platform for Hi Potential employees, about a 100 Hi Potentials were part of Strength finder workshops
to better appreciate their strengths and how such strengths can be leveraged at work. XChange, our inter corporate program for the
best of our Hi Potentials also progressed as per plan with strong action plans emerging from the 5-month learning intervention.

The Master Class learning series was launched in 2018 to teach employees specialized areas that could help them perform their jobs
better. Some examples of these workshop series were Finance, Design Thinking and Storytelling workshops for 220+ employees.

As part of strengthening employee experience for the new comers, the Company has significantly changed the onboarding processes.
Major change included having employees join at Corporate Office on fixed days of the month while also revamping our Feel@Home
program (New employee orientation program). At the Feel@Home program the new employees learn about the Big 3M, Our History
and Culture, interact with the senior leaders and teach back their learnings through an engaging competition.

The plant employees were part of workshops called ‘Associates Contributing Together’. These workshops facilitated by plant HR involved
interesting activities to build learning agility and cross-line collaboration for customer wins.

During festive season last October, HR organization engaged ~1100 employees across regions and plants on development themes
connecting to Growth and Transformation. This initiative further reinforces the various learning options available to employees while
also interacting with leaders on people development.

Empowering employees to be owners of their own learning, 3M’s Develop U platform was further refreshed with updated competency
models, employee sign up options for virtual trainings and leadership messages. Our virtual learning calendar gives employees the
option of signing up for learning modules in quick bytes at their location, at their convenient time slots.

3M’s Coaching program continues to help leaders navigate through accelerated business growth while the 3M Asia Mentoring Program
has helped employees connect with and learn from experienced leaders across 3M.

Employee’s Relations (ER):

The financial year 2018-2019 has been a year of improvement and positive change on the Industrial Relations (IR) front. The 3M
philosophy on IR has always been ‘direct engagement and communication with the organization’ which stands stronger today. The year
went smooth without any unwanted ER/IR instances or man-days loss.
Continued to focus on the Proactive ER strategy firmed on Connect, Communicate and Collaborate theme. The Company has
strengthened systems to reinforce the culture of respect and fairness. Leaders understand concerns proactively and communicated our
philosophy regularly through multiple platforms from time to time.
Some additional actions put in place:
1. As part of robust Employee Engagement framework, the Company has focused on Involvement of Shop floor employees in the
Corporate Social Responsibility projects.
2. The Company is taking the IR / ER focus a level higher with a structured employee relations plan - a key element of our growth
strategy.
3. An entire plan touching Communication, employee development, career progression and supervisor development has been
established. The 3M practice of connecting with families of our shop floor teams continues to be a great look-forward.
4. Processes to address grievances while maintaining a fair and firm stance on discipline is also being worked on.
These plans will be further strengthened through 2019.

HR Business Partner (HRBP):

HR Business Partners were aligned to businesses and supported employee engagement programs (Build.Develop.Engage) across
businesses and functions. These included Critical Talent mapping of all employees and ensuring right employee life cycle actions were
being taken in a timely manner.

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HR and other functions were available to engage with and train employees on various processes apart from being available for them on
a one on one basis to clear any personal issues they may need support for.
Specific, targeted retention plans were put together and rolled out for certain Functions and Businesses where retention was below
expected levels. These plans included training of supervisors, engagement activities and coaching among others.
Meanwhile the team was also actively involved in Organization Design and restructuring activities to ensure talent was placed in the
most productive positions and structures supported business needs.
On behalf of the Board of Directors
Debarati Sen B.V. Shankaranarayana Rao
Place : Bengaluru Managing Director Whole-time Director
Date : May 28, 2019 DIN: 07521172 DIN: 00044840

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REPORT ON CORPORATE GOVERNANCE

THE COMPANY’S GOVERNANCE PHILOSOPHY
3M’s Corporate Governance principles govern how the Company carries on its business daily, enabling the Company to outperform
and lead the way to sustainable growth. The governance principles provide enough framework that defines the roles, rights, and
responsibilities of different groups within the organization. The Board of Directors oversees the Executive Directors and Senior
Management (viz., the Leadership Team) including Key Managerial Personnel and ensures that appropriate procedures and controls
are in place covering Managements activities in operating the Company on ethical grounds on a day-to-day basis. The Company has
adhered to all the applicable SEBI (LODR) Regulations, 2015 for the financial year ended March 31, 2019.

BOARD OF DIRECTORS

Composition:
The Board comprises of Two (2) Executive Directors, Four (4) Non-Executive Non-Independent Directors and Three (3) Independent
Directors. The Board of Directors of the Company is headed by a Non-Executive and Independent Director.
As at the financial year ended March 31, 2019, the Board of Directors of the Company had an optimum combination of Executive
and Non-Executive Directors including three (3) Women Directors (viz., Independent Director, Non-Executive Director and Executive
Director) and not less than fifty percent (50%) of the Board of Directors comprises Non-Executive Directors and the composition is in
conformity with the provisions of the Companies Act, 2013 and the Listing Regulations, 2015. None of the Directors of the Company is
related to each other and with any employees of the Company.
The Board of Directors confirms that all the Independent Directors of the Company fulfill the conditions specified under SEBI (LODR)
Regulations, 2015 and are Independent of the Management of the Company.

Declaration under Schedule V, Part C, Clause 10(i) of SEBI (Listing Obligations and Disclosure Requirement) (Amendment) Regulations,
2018:
All the Directors have confirmed that they are neither debarred nor disqualified from being appointed or continuing as Director by
Securities and Exchange Board of India / The Ministry of Corporate Affairs or any such statutory authority. The Company has obtained
a Certificate to this effect from Mr. Vijayakrishna K.T., Practising Company Secretary, Bangalore as mandated under Schedule V, Part C,
Clause 10(i) of SEBI (Listing Obligations and Disclosure Requirement) (Amendment) Regulations, 2018.

Brief Profile of the Directors of the Company:

Mr. Bharat D Shah, Independent Director (holding DIN- 00136969): Mr. Bharat D Shah, 72 years, was duly appointed as an Independent
Director for a period of Five (5) years from March 27, 2015. Mr. Bharat Shah has extensive experience and expertise in the fields of
banking, finance and securities market. He has been one of the founder members of HDFC Bank Limited and has played a key role in the
establishment and consistent growth of the Bank. He is also on the Board of various prominent companies. Before joining the Financial
Sector, he worked with Technova, Bradma and Pyrene in London. He has also worked with Leading MNCs viz., Thomas Cook, Citibank
and with UBS. Mr. Bharat Shah is the Chairman of HDFC Securities Limited. He has his Bachelor’s in Science Degree from the University
of Mumbai and also holds a Degree in Applied Chemistry with special reference to metal finishing from Borough Polytechnic, London.
He was appointed as Chairman of the Board with effect from May 27, 2016.
Ms. Debarati Sen, Managing Director (holding DIN-07521172) : In her previous role, Ms. Debarati Sen, 51 years, held the position
of Director, Corporate Sales Operations for 3M Company, USA leading corporate initiatives critical to growth, sales effectiveness and
efficiency and as the Director for 3M’s US Atlantic & Pacific Branch Operations (Puerto Rico, Hawaii, Guam & Alaska).Ms. Debarati Sen’s
career spans over 24 years in Asia and US with over 18 years in 3M in various global, regional and country roles driving marketing, sales
and customer engagement, product development, business development, strategy as well as mergers and acquisitions. Prior to that,
she headed the global Oil & Gas business for 3M. She has also held the position of Vice President of Global Marketing – Equipment
Protection Business at Pentair, Inc. She is on the board of the 3M A3CTION (Asian Employee Resource Network) and an Executive
Member of 3M’s Women’s Leadership Forum. She also volunteers her time in reducing homelessness and poverty in the community
and in supporting education and empowerment in women and is on the national governing board of Jeremiah Program, a Minnesota
based national charity. Ms. Sen holds a BS/BE in Electronics Engineering, as well as an MBA in Marketing & Finance. Her career with
3M started in India in 1996 where she was the Division Manager for Personal Safety Division for 5 years and also led the Disposable
Respirator business for Asia. She was appointed as the Managing Director of the Company from June 1, 2016.

Mr. Amit Laroya, Non-Executive Director (holding DIN-00098933): Mr. Amit Laroya, 54 years, started his career at Asian Paints and
moved to 3M India in 1990 as the Division Head of Traffic, safety and Security. He has held positions in 3M India as the Country Business

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Leader in Safety & Graphics, Industrial, Electro and Telecommunication in addition to being the first Master Black Belt for India region.
He has also held positions as the M&A Manager for India region and General Manager of 3M Lanka. His previous assignment as the
Managing Director of 3M Indonesia and 3M India Limited made him well suited to understanding emerging market needs. He also has a
good understanding of global corporate strategies at 3M having recently worked in St Paul, USA, as the Global Director-for 3M Strategy
& Corporate Development & the Director of International Strategic Planning & M&A. Mr. Amit Laroya is an Economics Honors graduate
from the University of Delhi with MBA in Marketing and Finance from XLRI in India. He was the Managing Director of the Company from
October 1, 2013 to May 31, 2016.From June 1, 2016, he has been a Non-Executive Non-Independent Director of the Company. He was
appointed as President and Managing Director of 3M Korea Limited from June 1, 2016.
Mr. B.V. Shankaranarayana Rao, Whole-time Director (holding DIN-00044840): Mr. B.V. Shankaranarayana Rao, 59 years, holds a
bachelor’s degree in commerce and a master’s degree in Business Administration from Bengaluru University. He has been with the
Company since 1990. He has over 30 years of experience in Finance and Corporate Management. He has held various positions during
his tenure in 3M India. He has also worked in 3M Asia Pacific, Singapore, prior to heading the Finance Department in 3M India Limited.
He was appointed as a Whole-Time Director of the Company from July 24, 2002. Mr. Shankar Rao heads the Business Services Group,
Business Transformation and Information Technology.
Ms. Radhika Rajan, Independent Director (holding DIN- 00499485): Ms. Radhika Rajan, 63 years, heads DSP Investments, the umbrella
company of the Kothari Family Office, in Mumbai, India. The Kothari portfolio comprises of Indian securities, fixed-income, corporate
paper and loans, and some angel and private equity investments. Previously, Ms. Radhika was President of TCG Advisory of the TCG
Group, New York. In this capacity, Radhika conceived, set up, structured and managed the operations of TCG’s offshore Indian Equities
Funds for 7 years. Prior to joining the Fund in 2003, she advised TCG and several other private equity groups on various companies and
proposed investments in the US-India corridor. Ms. Radhika Rajan is a US citizen and long-term resident of New York who relocated to
India a few years earlier. She has focused on India as an investment destination since 1999, when she became New York based Executive
Vice-President of Mphasis. Prior to Mphasis, Ms. Rajan worked as a global macro proprietary trader at Chemical Bank (now JPMorgan))
Itochu, UBS, Bank of America, and Bank of Montreal where she created and managed several profitable trading structures. As a global
macro trader, she traded and took proprietary positions in a range of currencies, cash and options and in interest rate and commodity
futures and derivatives. Ms. Rajan holds an MBA degree from the Indian Institute of Management Ahmedabad and a MSc (Physics)
degree from Indian Institute of Technology, Mumbai. She was a National Science Talent Scholar through her Masters ‘degree. Ms. Rajan
is an invited author of “The Global Internet Economy,” a book published by MIT Press in 2003. She is a charter member of TIE, the
global Entrepreneurs organization and served as an Executive Board Member of TIE Tristate for over 5 years. TIE, a global association of
entrepreneurs active in accelerating the globalization of Indian business. (www.tie.org and www.tietristate.org). She was appointed as an
Independent Director for a period of Five (5) years with effect from May 27, 2016.
Mr. Biren Gabhawala, Independent Director (holding DIN- 03091772): Mr. Biren Gabhawala, 54 years, was appointed on the Board
of the Company as an Additional Director with effect from August 5, 2014. At the Annual General Meeting held on August 4, 2015,
he was appointed as an Independent Director for a period of Five (5) years with effect from August 5, 2014. He holds a Bachelor’s
degree in Commerce from University of Mumbai and is a qualified Chartered Accountant and a fellow member of the Institute of
Chartered Accountants of India. He is into practice for last 27 years. He is a Senior Partner of Messrs. C. M. Gabhawala & Co., Chartered
Accountants and specializes in Direct and Indirect Taxation, FEMA, International Taxation, Mergers, and Acquisitions.
Mr. Ramesh Ramadurai, Non-Executive Director (holding DIN- 07109252): Mr. Ramesh Ramadurai, 57 years, was appointed as
Business Director for 3M Industrial Business in July 2014 and is based out of Shanghai responsible for the entire Asia Pacific Area.
Prior to this role, Mr. Ramesh Ramadurai served as Managing Director of 3M Philippines from August 2011 until June 2014, based
in Manila. He Joined 3M India in 1989 as Sales Engineer and held positions as Country Business Leader in Industrial Business and
Electro & Telecommunications. He was seconded to Global Headquarters in St Paul, USA, and worked as Market Segment Manager in
Industrial Business, as Global Business Manager for a line of Industrial Tapes, and as International Business Manager for 3M’s Packaging,
Masking and Specialty Tapes businesses. Prior to 3M, Mr. Ramesh Ramadurai worked for a year as a Production Engineer at an Offshore
Oil Production facility, and for about 3 years in a business planning and development role at an automotive parts and motorcycle
manufacturer. Mr. Ramesh Ramadurai holds MBA from the Indian Institute of Management in Calcutta and is a Bachelor of Technology
in Chemical Engineering from the Indian Institute of Technology, Kanpur. He was appointed as a Non-Executive Non-Independent
Director of the Company with effect from March 27, 2015.
Mr. Jongho Lee, Non-Executive Director (holding DIN- 06720950): Mr. Jongho Lee (JH), 56 years, was named Finance Director - Asia
based out of Hong Kong from April 1, 2017. JH comes with a strong pedigree and regional experience across multiple companies. JH has
most recently been 3M Korea Finance Manager since April 1, 2014. Prior to that, he has held several roles in multiple Companies as:
• VP & CFO, Korea Delphi Automotive Component Company
• FP&A Executive, GM Korea

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ANNEXURE ‘B’ TO REPORT OF THE BOARD OF DIRECTORS 3M India Limited

• Korea Controller, GM
• Finance Controller, GM International Operation Manufacturing
• Asia Pacific HQs Strategy Board Planner (Shanghai), GM
• Finance Representative of Daewoo Group Restructuring Committee
• Treasurer, Daewoo Group
He is also the Co-Chairman of the AMCHAM CFO Committee, Korea and a Tax Committee Member of Korea Chamber of Commerce. JH
holds an MBA from the University of Michigan, Ann Arbor and a B.A., Seoul National University. He was appointed as a Non-Executive
Non-Independent Director of the Company from May 26, 2017.
Ms. Sadhana Kaul (holding DIN- 02589934): Mrs. Sadhana Kaul, 54years, joined the 3M India Limited in the year 2005 as General
Counsel and has over 25 years of experience in the legal field, having worked in different capacities in law firms in the US and in India.
Prior to joining 3M India limited, she was with GE Medical Systems as Senior Legal Counsel based in Bangalore. She has a History
Degree from St. Stephen’s College, Delhi University, India and holds a Bachelor’s degree in Law from Trinity College Cambridge, UK and
a Master’s degree in International and Comparative Law from Georgetown University Law Center, Washington D.C.
She was appointed as a Whole-Time Director of the Company from October 09, 2009 and was the General Counsel of the Company
till November 1, 2013. She resigned as Director and Whole-time Director with effect from November 1, 2013 consequent upon her
appointment as General Counsel for South East Asia Region, Singapore. Apart from being General Counsel for South East Asia Region,
she also supported Asia Manufacturing and Supply Chain Center of Expertise. She was appointed as a Non-Executive Director of the
Company from February 10, 2014. She resigned as Director of the Company with effect from the closing hours of May 27, 2016 due to
her pre-occupation and other commitments.
Ms. Sadhana Kaul has been appointed as Asia Area General Counsel with effect from September 1, 2018 and will continue to be based
out of Singapore where she will oversee the legal operations of 3M in all its Asia Subsidiaries.

Names of other companies/firms in which Directors of the Company hold/held office as Director/Partner are given below (as on
March 31, 2019):
Ms. Debarati Sen
- 3M Lanka (Private)Limited, Sri Lanka, Managing Director

Ms. Sadhana Kaul (from October 31, 2018)

- 3M Korea Limited

Mr. Ramesh Ramadurai

- Metamorph Learning Private Limited, Director

Mr. Jongho Lee

- Nil

Mr. B.V. Shankaranarayana Rao

- 3M Lanka (Private)Limited, Sri Lanka, Director

Ms. Radhika Rajan

- Sonata Software Limited, Director
- Sonata Information Technology Limited, Director

Mr. Amit Laroya

- 3M Korea Limited, President and Managing Director
- Sun Abrasives, Korea, Director

Mr. Biren Gabhawala

- eClerx Services Limited, Director
- Messrs. C.M. Gabhawala & Co, Partner

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ANNEXURE ‘B’ TO REPORT OF THE BOARD OF DIRECTORS 3M India Limited

Mr. Bharat D Shah

- Mahindra Lifespace Developers Limited, Director
- Apollo Munich Health Insurance Company Limited, Director
- HDFC Securities Limited, Chairman
- Hexaware Technologies Limited, Director
- Exide Industries Limited, Chairman
- Salisbury Investments Private Limited, Director
- Strides Pharma Science Limited (Formerly Strides Shasun Limited) Director
- Tata Sky Limited, Director
- Digikredit Finance Private limited (Formerly Amadeus Advisors Private Limited), Director
- Spandana Sphoorty Financial Limited, Director

Names of Committees/Chairmanships held details of the Directors are given below:

Membership of Chairmanship of
Committee Committees
Name of the Director Name of the Company
Stakeholder’s Stakeholder’s
Audit Audit
Relationship Relationship
Ms. Radhika Rajan 3M India Limited Yes Yes
Sonata Software Limited Yes
Sonata Information Technology Limited Yes
Ms. Sadhana Kaul Nil
Mr. Ramesh Ramadurai Nil
Mr. Jongho Lee 3M India Limited Yes
Mr. B.V. Shankaranarayana Rao Nil
Mr. Amit Laroya Nil
Ms. Debarati Sen 3M India Limited Yes
Mr. Biren Gabhawala 3M India Limited Yes Yes Yes
eClerx Services Limited Yes Yes Yes
Mr. Bharat D Shah 3M India Limited Yes Yes Yes
Tata Sky Limited Yes Yes
Spandana Sphoorty Financial Limited Yes Yes
Strides Pharma Science Limited Yes
Mahindra Lifespace Developers limited Yes
Skills / Expertise/Competencies of the Board of Directors:
The present Board Members have vast and varied experience and possess professional background and experience in General
Management of Business, Industry, Marketing, Finance, Taxation and Law. Following is the gist of skills / expertise / competencies
identified by the Board of Directors.
• Knowledge on the Company’s businesses, policies and culture, risks / threats and opportunities and knowledge of the industry in
which the Company operates.
• Behavioral skills - attributes and competencies to use their knowledge, professional skills to contribute effectively to the growth of
the Company.
• Business Strategy, Sales & Marketing, Corporate Governance, Forex Management, Administration and Decision Making,
• Financial, Taxation, Law and Management skills

Meetings:
The Meetings of the Board of Directors are normally held at the Company’s Corporate Office in Bengaluru. Meetings are generally
scheduled well in advance and the notice of each Board / Committee Meetings is given in writing to each Director. The yearly calendar
of the Meetings is finalized before the beginning of the year. Additional Meetings are held when necessary. The Board meets at least
once a quarter to review the quarterly performance and financial results of the Company. The Board is provided with the relevant

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ANNEXURE ‘B’ TO REPORT OF THE BOARD OF DIRECTORS 3M India Limited

information as stipulated in Listing Regulations. The Meetings are governed by a structured agenda. The Board papers, agenda and
other explanatory notes are circulated to the Directors seven (7) days prior to the Meetings. In addition, for any business exigencies,
the Resolutions are passed by circulation and later placed at the subsequent Board/Committee Meeting for ratification. The Minutes
of the Committee Meetings are sent to all Directors individually within the time limits prescribed under the Companies Act, 2013 and
are further tabled at the Board Meetings. The Company Secretary is responsible for convening the Board and Committee Meetings,
preparation and distribution of Agenda and other documents and recording of the Minutes of the Meetings. He acts as an interface
between the Board and the Management and provides required assistance and assurance to the Board and the Management on
compliance and governance aspects. During the financial year 2018-19, your Company has complied with the applicable Secretarial
Standards issued by the Institute of Company Secretaries of India.

Details of Board Meetings during the financial year:

During the financial year 2018-19, four (4) Meetings of the Board were held on May 30, 2018, August 09, 2018, October 30, 2018 and
February 12, 2019.The last Annual General Meeting (AGM) was held on August 10, 2018.
None of the Directors is a Director in more than Eight (8) Listed Companies or Ten (10) Public Limited Companies or acts as an Independent
Director in more than Seven (7) Listed Companies. The Managing Director and the Whole-Time Director do not serve as Independent
Director on any Listed Company. Further, none of the Directors acts as a member of more than Ten (10) Committees or acts as Chairman
of more than Five (5) Committees across all Public Limited Companies in which he/she is a Director.
Particulars of the directorships of Board, membership and office of the Chairman of Board Committees across all Companies as on
March 31, 2019 and attendance at the Board Meetings of the Company are exhibited below:

No. of Meetings
held during No. of Directorships and Committee
the year under Memberships / Chairmanships Whether
Name & Designation
Category review attended
of the Director
last AGM
Directorships Committee Committee
Held Attended
held@ Memberships# Chairmanships#
Mr. Bharat D Shah Non-Executive &
4 4 9 8 1 Yes
(Chairman) Independent Director
Mr. Biren Gabhawala Non-Executive &
4 4 2 4 2 Yes
(Director) Independent Director
Ms. Radhika Raja Non-Executive &
4 4 3 4 Nil Yes
(Director) Independent Director
Ms. Debarati Sen Executive Director
(Managing Director) 4 4 2@@ 1 Nil Yes
(Promoter Group)
Mr. B. V. Shankaranarayana Rao Executive Director
(Whole-time Director) 4 4 2@@ Nil Nil
(Promoter Group) Yes
Mr. Albert C Wang (Director) Non-Executive Director
2 2 1 Nil Nil Yes
(up to August 21, 2019) (Promoter Group)
Mr. Amit Laroya Non-Executive Director
4 2 3@@@ Nil Nil Yes
(Director) (Promoter Group)
Mr. Ramesh Ramadurai Non-Executive Director
4 2 1 Nil Nil
(Director) (Promoter Group) Yes
Mr. Jongho Lee Non-Executive Director
4 3 1 1 Nil No
(Director) (Promoter Group)
Ms. Sadhana Kaul Non-Executive Director
1 1 2@@ Nil Nil NA
(from October 31, 2018) (Promoter Group)
@ excludes directorship in private companies and includes directorship in 3M India Limited.
@@includes directorship in one foreign Body Corporate
@@@includes directorship in two foreign Body Corporates
# excludes committees other than Audit Committee and Stakeholders’ Relationship Committee

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Attendance details of Board Meetings:

Name of the Director May 30, 2018 August 9, 2018 October 30, 2018 February 12, 2019
Mr. Bharat D Shah Yes Yes Yes Yes
Mr. Biren Gabhawala Yes Yes Yes Yes
Ms. Radhika Rajan Yes Yes Yes Yes
Ms. Debarati Sen Yes Yes Yes Yes
Mr. B V Shankaranarayana Rao Yes Yes Yes Yes
Mr. Albert C Wang (up to August 21, 2018) Yes Yes NA NA
Mr. Amit Laroya LOA Yes LOA Yes
Mr. Ramesh Ramadurai Yes Yes LOA LOA
Mr. Jongho Lee Yes LOA Yes Yes
Ms. Sadhana Kaul (from October 31, 2018) NA NA NA Yes
Committee of the Board:
With a view to have a more focused attention on business and for better governance and accountability, the Board has constituted
the following mandatory committees viz. Audit Committee, Stakeholders’ Relationship Committee, Nomination and Remuneration
Committee and Corporate Social Responsibility Committee and from April 1, 2019, constituted a Risk Management Committee. The
terms of reference of these Committees are determined by the Board and their relevance reviewed from time to time.

Board Training and Induction

At the time of appointing a Director, a familiarization programme for Directors of the Company brochure is handed over which inter
alia explains the history of the Company, products / divisions of the Company in which it operates, performance of the Company during
the last quarter/year, other Directors’ profile, Leadership Team details, situation of factories and branch offices etc., role, function,
duties and responsibilities expected as a Director of the Company. In the same document, the Director is also explained in detail the
compliances required from him under the Companies Act, Listing Regulations and other relevant regulations. The Managing Director of
the Company also has a one-to-one discussion with the newly appointed Director. The above initiatives help the Director to understand
the Company, its business and the regulatory framework in which the Company operates and equips him to effectively fulfill his role as
a Director of the Company. Apart from the above, business heads also make presentations on their respective business and updates the
Board. The familiarization document is also disclosed on the website of the Company at http://solutions.3mindia.co.in/wps/portal/3M/
en_IN/about-3M/information/corporate/financial-facts/summary.
The Company has issued formal letters of appointment to all the Independent Directors of the Company in the manner as provided
in the Companies Act, 2013 including the tenure of appointment. The terms of appointment have also been disclosed on the website
of the Company at http://solutions.3mindia.co.in/wps/portal/3M/en_IN/about-3M/information/corporate/financial-facts/summary/.

CODE OF CONDUCT
The Company’s Board has laid down a code of conduct for all Board Members and Senior Management of the Company. The code
of conduct is available on the website of the Company: http://solutions.3mindia.co.in/wps/portal/3M/en_IN/about-3M/information/
corporate/financial-facts/summary/. Requisite annual affirmations of compliance with respective codes have been made by the
Directors and Senior Management of the Company for the period April 01, 2018 to March 31, 2019.
The Certificate by the CEO of the Company concerning compliance with the Code of Conduct for Directors and Senior Management is
given below:
Code of Conduct for Directors and Senior Management
CEO Confirmation
I hereby confirm that:

The Company has obtained from the Directors and Senior Management personnel affirmation that they have complied with the
above code for, and in respect of, the Year Ended March 31, 2019.

(Debarati Sen)
Place: Bengaluru Managing Director
Date May 13, 2019 DIN: 07521172

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ANNEXURE ‘B’ TO REPORT OF THE BOARD OF DIRECTORS 3M India Limited

AUDIT COMMITTEE
The Audit Committee of the Company functions in accordance with the requirements of Section 177 of the Companies Act, 2013 and
the Listing Regulations.

Terms of Reference of the Audit Committee:

The terms of reference of the Audit Committee as per guidelines set out under the Listing Regulations read with Section 177 of the
Companies Act, 2013, is set out below:
1. The Audit Committee shall have minimum Three (3) directors as members. Two-thirds (2/3) of the members of Audit Committee
shall be Independent Directors.
2. All members of Audit Committee shall be financially literate and at least One (1) member shall have accounting or related financial
management expertise.
3. Chairman of the Audit Committee shall be an Independent Director.
4. The Chairman of the Audit Committee shall be present at Annual General Meeting to answer Shareholder queries.
5. The Audit Committee may invite such executives of the Company as it considers appropriate (and particularly the head of the
finance function) to be present at the Meetings of the Committee, but on occasions it may also meet without the presence of
any of the executives of the Company. The CFO, Internal Auditor and a representative of the Statutory Auditor may be present as
invitees for the meetings of the Audit Committee.
6. The Company Secretary shall act as Secretary of the Audit Committee.
7. The Audit Committee shall meet at least four (4) times in a financial year and not more than 120 days shall elapse between two
Meetings. The quorum shall be either Two (2) members or one-third (1/3) of the members of the Audit Committee, whichever is
higher but there shall be a minimum of two (2) independent members present.

Powers of Audit Committee

The Audit Committee has the following powers:
1. To investigate any activity within its terms of reference.
2. To seek information from any employee.
3. To obtain outside legal or other professional advice.
4. To secure attendance of outsiders with relevant expertise, if it considers necessary.

Role of Audit Committee

The role of the Audit Committee shall include the following:
1. Oversight of the company’s financial reporting process and the disclosure of its financial information to ensure that the financial
statement is correct, sufficient and credible;
2. Recommendation for appointment, remuneration and terms of appointment of statutory auditors and cost auditors of the
Company;
3. Approval of payment to Statutory Auditors and Cost Auditors and for any other services rendered by the Statutory Auditors;
4. Reviewing, with the management, the annual financial statements and auditors’ report thereon before submission to the Board
for approval, with particular reference to:
(a) Matters required to be included in the Director’s Responsibility Statement to be included in the Board’s Report in terms of
clause (c) of sub-Section 3 of section 134 of the Companies Act, 2013.
(b) Changes, if any, in accounting policies and practices and reasons for the same.
(c) Major accounting entries involving estimates based on the exercise of judgment by management.
(d) Significant adjustments made in the financial statements arising out of audit findings.
(e) Compliance with listing and other legal requirements relating to Financial Statements.
(f) Disclosure of any related party transactions.
(g) Modified opinion (s) in the draft Audit Report.

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5. Reviewing, with the management, the quarterly financial statements before submission to the Board for approval;
6. Reviewing, with the management, the statement of uses / application of funds raised through an issue (public issue, rights issue,
preferential issue, etc.), the statement of funds utilized for purposes other than those stated in the offer document / prospectus
/ notice and the report submitted by the monitoring agency monitoring the utilization of proceeds of a public or rights issue, and
making appropriate recommendations to the Board to take up steps in this matter;
7. Review and monitor the auditors’ independence and performance, and effectiveness of audit process;
8. Approval or any subsequent modification of transactions of the company with related parties;
9. Scrutiny of inter-corporate loans and investments;
10. Valuation of undertakings or assets of the company, wherever it is necessary;
11. Evaluation of internal financial controls and risk management systems;
12. Reviewing, with the management, performance of statutory and internal auditors, adequacy of the internal control systems;
13. Reviewing the adequacy of internal audit function, if any, including the structure of the internal audit department, staffing and
seniority of the official heading the department, reporting structure coverage and frequency of internal audit;
14. Discussion with internal auditors of any significant findings and follow up there on;
15. Reviewing the findings of any internal investigations by the internal auditors into matters where there is suspected fraud or
irregularity or a failure of internal control systems of a material nature and reporting the matter to the board;
16. Discussion with statutory auditors before the audit commences, about the nature and scope of audit as well as post-audit
discussion to ascertain any area of concern;
17. To look into the reasons for substantial defaults in the payment to the depositors, debenture holders, shareholders (in case of
non-payment of declared dividends) and creditors;
18. To review the functioning of the Whistle Blower mechanism;
19. Approval of appointment of CFO (i.e., the whole-time Finance Director or any other person heading the finance function or
discharging that function) after assessing the qualifications, experience and background, etc. of the candidate;
20. Carrying out any other function as is mentioned in the terms of reference of the Audit Committee.
21. To grant omnibus approval for related party transactions which are in the ordinary course of business and on an arm’s length
pricing basis.
22. Reviewing the utilization of loans and/ or advances from/investment by the holding company in the subsidiary exceeding INR.
100 crores or 10% of the asset size of the subsidiary, whichever is lower including existing loans / advances /investments existing
as on the date of coming into force of this provision.

Review of information by the Audit Committee

The Audit Committee reviews the following information:
1. Management discussion and analysis of financial condition and results of operations;
2. Statement of significant related party transactions (as defined by the Audit Committee), submitted by management;
3. Management letters / letters of internal control weaknesses issued by the Statutory Auditors;
4. Internal Audit Reports relating to internal control weaknesses; and
5. The appointment, removal and terms of remuneration of the Chief internal auditor shall be subject to review by the Audit
Committee.

Composition and details of Audit Committee Meetings during the financial year:
As on March 31, 2019, the Audit Committee of the Company consists of Three (3) Non-Executive & Independent Directors and one
(1) Non-Executive Director and all of them have financial and accounting knowledge. The members of the Committee are Mr. Biren
Gabhawala, Ms. Radhika Rajan, Mr. Bharat D Shah and Mr. Jongho Lee.

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ANNEXURE ‘B’ TO REPORT OF THE BOARD OF DIRECTORS 3M India Limited

Mr. Biren Gabhawala is the Chairman of the Audit Committee. The Company Secretary is the Secretary to the Committee. At the
invitation of the Committee, the Managing Director, Whole-time Director, the Internal Auditor, the CFO, General Counsel and Statutory
Auditors attend the Audit Committee Meetings.
During the financial year 2018-19, four (4) Meetings of the Audit Committee were held on May 30, 2018, August 09, 2018, October 30,
2018 and February 12, 2019.The numbers of Meetings attended during the financial year under review are as under:

No. of Meetings held

No. of Meetings
Name of the Committee Members during the year
attended
under review
Mr. Biren Gabhawala (Chairman) 4 4
Mr. Bharat D Shah 4 4
Ms. Radhika Rajan 4 4
Mr. Jongho Lee 4 3

Attendance details of the Audit Committee Meetings:

Name of the Director May 30, 2018 August 9, 2018 October 30, 2018 February 12, 2019
Mr. Bharat D Shah Yes Yes Yes Yes
Mr. Biren Gabhawala Yes Yes Yes Yes
Ms. Radhika Rajan Yes Yes Yes Yes
Mr. Jongho Lee Yes LOA Yes Yes

NOMINATION AND REMUNERATION COMMITTEE (NRC)

In compliance with Section 178 of the Companies Act, 2013 and the Listing Regulations the Board has formed the “Nomination and
Remuneration Committee”. The terms of reference of the Committee inter alia, the following:
(a) Chairperson: Chairperson of the Committee shall be an Independent Director as may be elected by the members of the Committee.
(b) Quorum: Quorum for Meeting of the Committee shall be a minimum of Two (2) members provided one (1) of them shall always
be an Independent Director.
(c) Frequency of Meetings: The Committee may meet at such times and at such intervals as it may deem necessary and shall at least
meet once a year.
(d) Role: The Role of the Committee shall include inter-alia the following:
• Formulation of criteria for determining qualifications, positive attributes and independence of a director and recommend
to the Board a policy, relating to the remuneration of the directors, key managerial personnel and other employees;
• Formulation of criteria for evaluation of Independent Directors and the Board including carrying out evaluation of every
Director’s performance;
• Devising a policy on Board diversity;
• Identifying persons who are qualified to become Directors and who may be appointed in senior management in accordance
with the criteria laid down and recommend to the Board their appointment and removal.
• Such other matters as may be prescribed under the Companies Act, 2013, Listing Regulations and by the Board of Directors
of the Company from time to time.
• Recommend to the Board, all remuneration, in whatever form, payable to senior management.
(e) Invitees: The Committee may invite such executives of the Company and such other persons as it may consider appropriate.
(f) Secretary to the Committee: The Company Secretary shall be the Secretary of the Committee who shall flag actions and serve as
executive support to the Committee.
The Remuneration Policy for Directors, Key Managerial Personnel and for other employees has been disclosed in the website of the
Company at http://solutions.3mindia.co.in/wps/portal/3M/en_IN/about-3M/information/corporate/financial-facts/summary/.

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Criteria of selection of Non-Executive Independent Directors

The Non- Executive Directors shall be of high integrity with relevant expertise and experience so as to have a diverse Board with
Directors having expertise in the fields of manufacturing, marketing, finance, taxation, law, governance and general management.
The NRC shall satisfy itself with regard to the independent nature of the Directors vis-à-vis the Company so as to enable the Board to
discharge its function and duties effectively. The NRC shall ensure that the candidate identified for appointment as a Director is not
disqualified for appointment under Section 164 of the Companies Act, 2013. The NRC shall consider the following attributes / criteria,
whilst recommending to the Board the candidature for appointment as Director.
i. Qualification, expertise and experience of the Directors in their respective fields;
ii. Personal, Professional or business standing;
iii. Diversity of the Board.
The Diversity of the Board aims to:
- enhance the quality of performance of the Board,
- usher in independence in the performance of the Board,
- achieve sustainable and balanced performance and development in the Company,
- support the attainment of strategic objectives of the Company,
- remove the gender bias in the Board, and,
- Compliance of applicable law/s and good corporate practices.
In case of re-appointment of Directors, the Board shall take into consideration the performance evaluation of the Director and his/her
engagement level.

Criteria of selection of Non-Executive and Executive Directors

For the purpose of selection of the Non-Executive and Executive Directors, the incumbent shall possess relevant expertise, experience
and leadership qualities required for that position. The NRC will also ensure that the incumbent fulfills such other criteria with regard to
age and other qualifications as laid down under the Companies Act, 2013.

Criteria of selection of Senior Management personnel (including KMPs)

For the purpose of selection (including internal selection) of the senior management personnel (including KMPs), criteria such as
relevant expertise, experience, qualifications are taken into consideration.

Remuneration Policy of the Company

Annually, the Center of Expertise Total Rewards Team (COE TR) team works closely with Mercer & Willis Towers Watson, Salary
Consultants to determine the worth of each job by doing a market benchmark study.    As a process, the Company conducts job
evaluation and job matching process with the help of Salary Consultant(s) appointed by the organization. The COE TR team and the
Salary Consultant (s) work closely first to understand all the roles in the organization and map the roles to their frame work. The
Company Benchmarks and compares itself with Total Cash which includes Fixed pay and Variable pay.    Total Rewards team creates the
comparator basket/peer companies list based on the companies 3M recruit and lose talent. These companies become the comparator
list to determine the compensation rates.
COE Total Rewards at St. Paul after finalization of peer companies from 3M India list, interact with the Salary Consultants with the
shortlisted companies (Peer companies) to understand their roles and map them to their frame work. Post which, they compare the
roles and compensation as per the mapping exercise. Upon this exercise, Consultants, based on the mapping provide compensation
rates for each level.    Total Rewards team based on the market median, draws Market Reference point (MRP).  
Based on the above guidelines, each level, starting from the entry to the head of the organization the pay range is determined. The
determined pay ranges are shared with the Managing Director and Business/Functional leaders to understand the salary movements
and obtain approval on the MRP for the year. The approved MRP is used for the merit increase exercise along with the employee
performance rating. The Total Rewards team culls out the Compensation ratio (Distance from the new mid-point) and the proposed
increase for each employee and the organization, as a whole. Post completion of this exercise, the increase is discussed with the
CFO to find out the affordability and the impact on the Company’s Profit and Loss account.    Based on the company’s objectives and
affordability, the overall company increase rates are determined.    The calibrated increment value, if any, is taken as the approved
increase at a company level. Total Rewards reworks the entire compensation increases by employee-wise based on the available
budget.   Else, the Company will go as per the increase proposed based on compa ratio, performance rating, salary movements etc.

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The final employee wise increases are broken into department/business wise budget for annual Increases. C & B team annually reviews
the compensation structure, to ensure that the appropriate mix of fixed and variable pay is considered and also ensures that the
compensation structure is in line with the Income tax rules, as applicable.
The above process is followed for all Non-production employees in the Company including the Managing Director, Wholetime Director
and Key Management Personnel.
The Company pays Rs. 20,000/- to each Independent Director per Board /Committee Meetings as sitting fees and a fixed Commission
not exceeding Rs. 15,00,000/- P.A. to each of the Independent Directors. The Maximum amount payable to all Independent Directors is
restricted to one percent (1%) of the net profit of the Company computed as per the provisions of Section 198 of the Companies Act,
2013. The Non-Executive Non-Independent Directors are not paid any Sitting Fees and Commission.
The remuneration by way of commission paid to Independent Directors is commensurate with the activities of the Company, the
responsibilities of the Independent Directors under the provisions of Listing Regulations and under the Companies Act, 2013, and the
responsibilities as Member/Chairman of the Board and Member/Chairman of committee/s of Board and all other relevant factors.

Composition and details of Nomination and Remuneration Committee Meetings during the financial year:
As on March 31, 2019, the Nomination and Remuneration Committee of the Company consists of two (2) Non-Executive Independent
Directors viz., Mr. Bharat D Shah, Mr. Biren Gabhawala and two (2) Non-Executive Directors viz., Mr. Albert C Wang (up to August 21,
2018), Ms. Sadhana Kaul (from October 31, 2018) and Mr. Amit Laroya. Mr. Biren Gabhawala is the Chairman of the Committee. The
Company Secretary is the Secretary to the Committee.
During the financial year 2018-19, Three (3) Meetings of the Nomination and Remuneration Committee were held on May 30, 2018,
October 30, 2018 and February 12, 2019. The number of Meetings attended during the year under review is as under:

No. of Meetings held

No. of Meetings
Name of the Committee Members during the financial year
attended
under review
Mr. Biren Gabhawala (Chairman) 3 3
Mr. Bharat D Shah 3 3
Mr. Albert C Wang (up to August 21, 2018) 1 1
Mr. Amit Laroya 3 2
Ms. Sadhana Kaul (from October 31, 2019) 1 1

Attendance details of Nomination and Remuneration Committee Meetings:

Name of the Director May 30, 2018 October 30, 2018 February 12, 2019
Mr. Biren Gabhawala Yes Yes Yes
Mr. Bharat D Shah Yes Yes Yes
Mr. Albert C Wang (up to August 21, 2018) Yes NA NA
Mr. Amit Laroya LOA Yes Yes
Ms. Sadhana Kaul (from October 31, 2018) NA NA Yes

Remuneration to Directors:
As at the end of financial year 2018-19, the Company has Two (2) Executive Directors, Ms. Debarati Sen, Managing Director and Mr. B.
V. Shankaranarayana Rao, Whole-time Director.
The Managing and Whole-Time Directors of the Company have been appointed on contractual basis and their terms of appointment
were fixed by the Board and the appointments pertaining to Ms. Debarati Sen, Managing Director and Mr. B. V. Shankaranarayana Rao,
Whole-Time Director were approved by the Members at the Annual General Meetings for tenures up to Five (5) years and Three (3)
years and 43 days respectively and by the Central Government also in case of Ms. Debarati Sen, Managing Director.

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ANNEXURE ‘B’ TO REPORT OF THE BOARD OF DIRECTORS 3M India Limited

The elements of the remuneration package of Executive Directors comprise Salaries and Allowances, Perquisites, Company Leased
Accommodation, Company Car and driver, Telephone at home, club fees, Gratuity, Personal Accident Insurance and contribution to
provident funds and other funds. The contract of employment of Executive Directors is terminable by serving a notice of Ninety (90)
days. The Company has no stock option/equity-based awards or any other Stock Linked Incentive Plans. However, senior executives of
the Company including Managing Director and Whole-Time Director of the Company are entitled to the Restricted Stock Options/Stock
Appreciation Unit Plans declared by the Parent Company, 3M Company USA, from time to time. As per 3M International Policy, the
Company which employs the respective employees is required to bear the cost of the options.

Details of remuneration for the financial year ended March 31, 2019:

(a) Executive Directors:

Estimated
No. of Salaries & Contribution to
Value of Total Present term
Name and Designation Shares Allowances Provident Fund
Benefits (Rs.) expires on
Held (Rs.) (Rs.)
(Rs.)

Ms. Debarati Sen

Nil 2,11,19,459 38,32,572 3,18,17,974 5,67,70,005 May 31, 2021
(Managing Director)
Mr. B.V. Shankaranaryana Rao
Nil 2,16,74,818 7,68,744 Nil 2,24,43,562 May 13, 2020
(Whole-Time Director)

(b) Non-Executive Independent Directors:

Sitting Fees for Board Sitting Fees for

No. of Meetings (Gross) (paid Committee Meetings Commission
Total
Name of the Director Shares during the FY 2018-19) (Gross) (paid during (Gross)
(Rs.)
Held the FY 2018-19) (Rs.)
(Rs.) (Rs.)
Mr. Bharat D Shah Nil 80,000 2,80,000 15,00,000** 18,60,000
Mr. Biren Gabhawala Nil 80,000 2,40,000 15,00,000** 18,20,000
Ms. Radhika Rajan) Nil 80,000 1,80,000 15,00,000** 17,60,000
**Remuneration by way of Commission for the financial year 2018-19 will be paid to the Independent Directors after the accounts for
the financial year 2018-19 have been adopted and approved by the members at the ensuing AGM.
The Non-Executive Directors viz., Mr. Albert C Wang (up to August 21, 2018), Mr. Amit Laroya, Mr. Ramesh Ramadurai, Ms. Sadhana Kaul
(from October 31, 2018) and Mr. Jongho Lee did not receive Sitting Fees and Commission. None of the Non-Executive Directors has any
pecuniary relationship with the Company.

STAKEHOLDERS’ RELATIONSHIP COMMITTEE

In compliance with the provisions of Section 178(5) of the Companies Act, 2013 and the provisions of the Listing Regulations, the Board
has formed the “Stakeholders’ Relationship Committee”.
The terms of Reference of the Committee are as under:
1. To look into the redressal of grievances of shareholders, debenture holders and other security holders including complaints
related to transfer of shares, non-receipt of balance sheet and non-receipt of dividends.
2. The Committee shall meet every quarter and that quorum for Meeting of the Committee shall be a minimum of Two (2) members
with the presence of at least one (1) Independent Director.
3. The Company Secretary will be the Secretary of the Committee who shall flag actions and serve as executive support to the
Committee.
4. Resolving the grievances of the security holders of the listed entity including complaints related to transfer/transmission of shares,
non-receipt of annual report, non-receipt of declared dividends, issue of new/duplicate certificates, general meetings etc.
5. Review of measures taken for effective exercise of voting rights by Shareholders.

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ANNEXURE ‘B’ TO REPORT OF THE BOARD OF DIRECTORS 3M India Limited

6. Review of adherence to the service standards adopted by the listed entity in respect of various services being rendered by the
Registrar & Share Transfer Agent.
7. Review of the various measures and initiatives taken by the listed entity for reducing the quantum of unclaimed dividends and
ensuring timely receipt of dividend warrants/annual reports/ statutory notices by the shareholders of the company.

Composition and details of Stakeholders’ Relationship Committee Meetings during the financial year:
As on March 31, 2019, the Stakeholders’ Relationship Committee of the Company consists of Four (4) Directors, of which Three (3) are
Non-Executive and Independent Directors and One (1) is Executive Director. The Members of the Committee are Mr. Bharat Shah, Ms.
Debarati Sen, Mr. Biren Gabhawala and Ms. Radhika Rajan. Mr. Bharat Shah is the Chairman of the Committee. The Company Secretary
is the Compliance Officer of the Company.
During the financial year 2018-19, Four (4) Meetings of the Stakeholders’ Relationship Committee were held on May 30, 2018, August
09, 2018, October 30, 2018 and February 12, 2019. The attendance of the members at the Stakeholders’ Relationship Committee
Meeting held during the financial year are as under:

No. of Meetings held No. of Meetings

Name of the Committee Members
during the year under review attended
Mr. Bharat Shah (Chairman) 4 4
Mr. Biren Gabhawala 4 4
Ms. Radhika Rajan 4 4
Ms. Debarati Sen 4 4

Attendance details of Stakeholders’ Relationship Committee:

Name of the Director May 30, 2018 August 9, 2018 October 30, 2018 February 12, 2019
Mr. Bharat Shah Yes Yes Yes Yes
Mr. Biren Gabhawala Yes Yes Yes Yes
Ms. Radhika Rajan Yes Yes Yes Yes
Ms. Debarati Sen Yes Yes Yes Yes
The Company through its Registrar and Share Transfer Agents has addressed / resolved most of the investor grievances / correspondence
within a period of 7 days from the date of their receipt except in cases that are constrained by disputes or legal impediments. The
statistics of Members complaints received / redressed, during the period under review are as under:

No. of Shareholders’ complaints pending as at April 01, 2018. Nil

No. of complaints received during the period April 01, 2018 to March 31, 2019. 43
No. of Shareholders’ complaints resolved during the period April 01, 2018 to March 31, 2019. 43
No. of Shareholders’ complaints pending as on March 31, 2019. Nil

The Share Transfer Committee comprises of Ms. Debarati Sen, Managing Director and Mr. B.V. Shankaranarayana Rao, Whole-time
Director.

CORPORATE SOCIAL RESPONSIBILITY COMMITTEE (CSR)

In compliance with the provisions of Section 135 of the Companies Act, 2013, the Board constituted a Corporate Social Responsibility
Committee. The CSR Policy of the Company has been disclosed on the website of the Company at http://solutions.3mindia.co.in/wps/
portal/3M/en_IN/about-3M/information/corporate/financial-facts/summary/.
The terms of Reference of the Committee are as under:
(a) Chairman: Chairman of the CSR Committee shall be an Independent Director as may be elected by the members of the CSR
Committee.

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(b) Quorum: Quorum of the CSR Committee shall be minimum of Two (2) members provided One (1) of them shall always be an
Independent Director.
(c) Frequency of Meetings: The CSR Committee may meet at such times and at such intervals as it may deem necessary.
(d) Role: The Role of the CSR Committee shall include inter-alia the following:
• Formulate and recommend to the Board, a Corporate Social Responsibility Policy indicating the activities to be undertaken
by the Company from time to time;
• Recommend the amount of expenditure to be incurred on the activities undertaken as specified in Schedule VII of the
Companies Act,2013;
• Monitor the Corporate Social Responsibility Policy of the Company from time to time;
• Perform such functions as may be statutorily required by the CSR Committee;
• Other matters as may be assigned by the Board from time to time.
(e) Invitees: The CSR Committee may invite such executives of the Company and such other persons as it may consider appropriate.

Composition and details of Corporate Social Responsibility meetings during the financial year:
As on March 31, 2019, the CSR Committee of the Company consists of Four (4) Directors, of which One (1) each are Non-Executive &
Independent Director and Non-Executive Director and Two (2) are Executive Directors. The Members of the Committee are Mr. Bharat
D Shah, Ms. Debarati Sen, Mr. B.V. Shankaranarayana Rao and Mr. Ramesh Ramadurai. Mr. Bharat D Shah is the Chairman of the CSR
Committee.
During the financial year 2018-19, Two (2) Meetings of the CSR Committee were held on May 30, 2018 and October 30, 2018. The
attendance of the members at the CSR Committee Meeting held during the financial year are as under:

No. of Meetings held during the No. of Meetings

Name of the Committee Members
financial year under review attended
Mr. Bharat D Shah (Chairman) 2 2
Ms. Debarati Sen 2 2
Mr. B.V. Shankaranarayana Rao 2 2
Mr. Ramesh Ramadurai 2 1

Attendance details of Corporate Social Responsibility Meetings:

Name of the Director May 30, 2018 October 30, 2018

Mr. Bharat D Shah Yes Yes
Ms. Debarati Sen Yes Yes
Mr. B.V. Shankaranarayana Rao Yes Yes
Mr. Ramesh Ramadurai Yes LOA

INDEPENDENT DIRECTORS’ MEETING

During the financial year under review, the Independent Directors met on February 12, 2019, inter alia, to discuss:
• Evaluation of the performance of the Non-Independent Directors and the Board as a whole,
• Evaluation of the performance of the Chairman of the Company, Chairman of the Committee’s taking into account the views of the
Executive and Non- Executive Directors,
• Evaluation of the quality, content and timelines of flow of information between the Management and the Board that is necessary
for the Board to effectively and reasonably perform its duties.
All the Independent Directors viz., Mr. Bharat D Shah, Mr. Biren Gabhawala and Ms. Radhika Rajan were present at the Meeting held
on February 12, 2019.

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PERFORMANCE EVALUATION OF BOARD/COMMITTEE’S /DIRECTORS

Pursuant to the provisions of the Companies Act, 2013 and Listing Regulations, the Board carried out the Annual Performance Evaluation
of: (i) the Board as a whole, (ii) individual directors (including Independent Directors and Chairperson) and (iii) various Committees of
the Board based on SEBI’s Guidance Note on Board Evaluation issued in January 2017.
A structured and detailed questionnaire was prepared by the Company internally, covering the following criteria’s:

For Board as a whole-

Structure of the Board, Meetings of the Board, Functions of the Board, Board and Management, Professional Development.

For Committees of the Board-

Mandate and Composition, effectiveness of the Committee, structure of the Committee and Meetings, Independence of the Committee
from the Board and contributions to decisions of the Board

For Individual Directors and Chairperson (including Chairperson, CEO, Independent Directors, Non-independent directors, etc.)-
Qualifications, experience, knowledge and competency, fulfillment of functions, initiative, availability and attendance, commitment,
contribution and integrity.

Following additional criteria for Independent Directors were covered:

Independence and independent views and judgment.

Following additional criteria for Chairperson were covered-

Effectiveness of leadership and ability to steer the meetings, Impartiality, Commitment and ability to keep shareholder’s interest in
mind.
Based on the above criteria’s, rating sheets were filled by each of the Directors with regard to Annual Performance Evaluation of: (i) the
Board as a whole, (ii) individual Directors (including Independent Directors and Chairperson) (except for the Director being evaluated)
and (iii) various Committees of the Board were sent in a sealed envelope / mailed directly to the Head –HR for summarizing the results.
The Head-HR was invited for the Independent Directors (IDs) meeting held on February 12, 2019 for facilitating, summarizing and
sharing the results of the evaluation of the performance of Non-Independent Directors and Board as a whole and of the Chairperson
of the Company taking into account the views of Executive directors and Non-Executive directors. The Chairperson of the Meeting of
IDs briefed the Nomination and Remuneration Committee (NRC) of the outcome of their Meeting held on February 12, 2019. The NRC
evaluated the performance of all the Directors at its Meeting held on February 12, 2019. The Chairman of the NRC briefed the Board
of the outcome of its Meeting and the Board evaluated the performance of the Board as a whole and the Independent Director’s
(excluding the Director to be evaluated). There were some suggestions from the Independent Directors for further improvement in the
effectiveness of the Board. All the suggestions were considered, and the Company is the process implementing the same in a phased
manner. The Head-HR facilitated by summarizing and sharing the results from the filled in questionnaire for each of the Independent
Directors.
The Directors were satisfied with the evaluations results which reflected the overall engagement and effectiveness of the Board and its
Committees.

RISK MANAGEMENT
The Risk Management Policy of the Company is intended to:
• to serve as a document wherein risks affecting the entire organization, at a macro-level are enumerated
• to describe the measures employed by the management in managing these risks across all divisions and functions, and
• to act as a reference to comprehend how mitigation measures employed by 3M India play a role in reducing the impact and
likelihood of these risks.
The Management revisits the Policy on a bi-annual basis as determined by the Board of Directors to keep abreast of changes through
a process of periodical monitoring of risks and the level of operational efficiency of controls. Newly identified risks shall be assessed,
understood and impact measured. An evaluation of checks and balances in place and the need for additional measures shall be
considered. This shall be achieved through the collaborative efforts of all heads of business and functional divisions. These business
and functional heads also seek information from their respective teams to address critical risks that may arise from the grassroots level.
The Company has identified many important risks which may have a significant impact on the business, if ignored. The Company has
established a set of proactive and reactive measures to address them. These risks were determined based on detailed analysis of the
markets where we operate, nature of our products and services rendered, and inherent risks in various functions.

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The Company has constituted a Risk Committee comprising members of the Leadership Team. The members of the Committee shall be
jointly responsible for recommending to the Board of Directors the methodology for risk oversight and management.
The members of the Risk Committee are vested with the following responsibilities:
1. Laying down a framework for identification of risk elements which are pertinent to achieving the company’s strategic objectives.
2. Reviewing strategies, policies, procedures, systems and processes in place for identification of new risks.
3. Assessing the identified risks vis-à-vis their impact and likelihood on the different business divisions.
4. Determining the adequacy of existing mitigation factors including the infrastructure and resources in place and considering the
adoption of new systems and processes, in case necessary.
5. Laying down policies and procedures for timely implementation of the mitigation factors.
6. Setting out the roles and responsibilities of various personnel responsible for the mitigation of risks at different processes.
7. Monitoring compliance with policies and procedures related to risk identification and mitigation.
8. Hold meetings on a bi-annual basis to discuss and evaluate the Risk Management Policy.
The Listing Regulations requires the constitution of Risk Management Committee (RMC) by the top 100 listed entities determined
based on market capitalization as at the end of immediate previous financial year. The Companies Act, 2013 does not prescribe any such
requirement. Further, the Listing Regulations do not specify the role of RMC. As per the Kotak Committee recommendations, SEBI has
accepted the recommendations and has amended the Listing Regulations and that the constitution of RMC would now be applicable
to top 500 listed entities and the role of RMC would specifically include cybersecurity effective from April 1,2019. As the Company falls
under the top 500 listed entities, RMC is applicable with effect from April 1, 2019. The majority of members of RMC would consist of
members of the Board of Directors. The Chairperson of the RMC should be a member of the Board of Directors. The RMC shall meet
at least once in a year. The Board of Directors shall define the role and responsibility of the RMC and may delegate monitoring and
reviewing of the Risk Management plan to the Committee and such other functions as it may deem fit.
The Company on February 12, 2019 has constituted a Risk Management Committee (RMC) of the Board effective from April 1, 2019
with following as members of the Committee:
Mr. Biren Gabhawala – Independent Director, Chairperson
Mr. Bharat Shah – Independent Director
Ms. Radhika Rajan – Independent Director
Ms. Debarati Sen – Managing Director
Mr. B.V. Shankaranarayana Rao – Whole-Time Director
Ms. Sadhana Kaul – Non-Executive Director
The Board has delegated the monitoring and reviewing of the Risk Management Plan to the Leadership Team members of the Company,
who shall be jointly responsible for recommending to the RMC the methodology for risk oversight and management through a team
consisting of members from Business Services group, Sourcing, Corporate Secretarial and Finance.

VIGIL MECHANISM / WHISTLE BLOWER POLICY

In accordance with the requirements of Sections 177(9) and (10) of the Companies Act 2013 read with Rule 7 of the Companies
(Meetings of Board and its Powers) Rules, 2014 and the provisions of Listing Regulations, the Company has established an effective
Vigil Mechanism by way of this Business Conduct Concern Reporting Policy (Whistle Blower Policy) for Upholding 3M’s Code of Conduct
(available at 3M.com/businessconduct ), 3M’s values and all laws applicable to 3M India Limited’s operations in India is the responsibility
of everyone acting on 3M’s behalf. The Policy sets out ways through which 3M’s employees, investors, customers, vendors and other
stakeholders can raise concerns that relate to actual or suspected violations of 3M’s Code of Conduct, accounting or auditing matters
and applicable national and international laws. The details of the website/hotline are as under:
Website: www.3M-Ethics.com or the International Toll-Free Service (ITFS) from India – 000-800-100-1071/000-800-001-6112.
The Company prohibits retaliation against anyone who raises a business conduct concern or cooperates in a Company investigation.
Complaints made in good faith will not expose the Concerned Party to any sanctions, regardless of whether the underlying facts prove
to be correct or result in any corrective action. If a Concerned Party believes that he /she has faced retaliation of any kind, he /she can
report it to any of the persons mentioned in the Policy so that the Company can investigate.

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Status update on the above Policy is reported to the Audit Committee every quarter and the Policy has been disclosed in the website
of the Company at http://solutions.3mindia.co.in/wps/portal/3M/en_IN/about-3M/information/corporate/financial-facts/summary/.

SUBSIDIARY COMPANIES
In accordance with section 129(3) of the Companies Act, 2013, (‘Companies Act’) a statement containing salient features of the financial
statement of the Subsidiary Company in Form AOC-1 is provided as “Annexure L”. Secretarial Audit Report is not applicable as it is not
a material subsidiary.

RELATED PARTY TRANSACTIONS

The Company has formulated a Policy on materiality of related party transactions and also on dealing with Related Party Transactions.
Prior approvals of all Related Party Transactions (RPTs) are obtained from the Audit Committee. The Audit Committee has granted
omnibus approval for RPTs for the estimated transactions for the financial years 2017-18, 2018-19 and 2019-20 to be entered into by
the Company after considering all the conditions of the provisions of the Listing Regulations. The Company has obtained the approval
of the Shareholders of all the material RPTs for the years 2017-18, 2018-19 and 2019-20 at the AGM held on August 10, 2017.
The Company follows the following Policy in disclosing the Related Party Transactions to the Audit Committee:
A statement in summary form of transactions with related parties at arm’s length price in the normal course of business.
• All material individual transactions with related parties, which are not in the normal course of business and which are not on an
arm’s length basis.
• All material financial and commercial transactions relating to senior management where they have personal interest that may have
a potential conflict with the interest of the Company at large.

DISCLOSURES
Related Party Transactions:
Details of all material transactions with related parties are disclosed along with the Compliance Report on Corporate Governance. The
Company has disclosed the Policy on dealing with Related Party Transactions on its website at http://solutions.3mindia.co.in/wps/
portal/3M/en_IN/about-3M/information/corporate/financial-facts/summary/.

Accounting Treatment:
The Company’s Financial Statements (Standalone and Consolidated) for the financial year ended March 31, 2019 are prepared in
accordance with Ind AS notified under the Companies (Indian Accounting Standards) Rules, 2015. All applicable Ind AS have been
applied consistently and retrospectively wherever required. The resulting difference between the carrying amounts of the assets and
liabilities in the consolidated financial statements under both Ind AS and Indian GAAP as of the transition date have been recognized
directly in equity at the transition date.
Proceeds from Public issues, rights issue, preferential issues etc: The Company has not made any capital issues during the financial
year 2018-19.

General Body Meetings:

Details of Annual General Meetings (AGM) of the Company held for the last three (3) years:

Date Meeting Location Time

Trinity Hall, Vivanta by Taj,

August 5, 2016 AGM 11.00 a.m.
41/3, M.G. Road, Bengaluru – 560 001

Trinity Hall, Vivanta by Taj,

August 10, 2017 AGM 11.00 a.m.
41/3, M.G. Road, Bengaluru – 560 001

Trinity Hall, Vivanta by Taj,

August 10, 2018 AGM 11.00 a.m.
41/3, M.G. Road, Bengaluru – 560 001

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ANNEXURE ‘B’ TO REPORT OF THE BOARD OF DIRECTORS 3M India Limited

Particulars of Special Resolutions passed in the last three AGMs are given below:

August 5, 2016 Payment of Remuneration by way of Commission to Non-Executive Directors of the Company for five (5)
Financial years commencing from the FY April 1, 2016.
August 10, 2017 Nil
August 10, 2018 Nil

Particulars of Resolution passed through Postal Ballot during the year 2018-19 :

Notice dated Particulars of Resolution Remarks

June 21,2018 Investment in the Equity Share Capital of 3M Electro & Communication Resolution passed with requisite
India Private Limited majority

Details of voting pattern:

No. of votes contained in

Remote E-voting Ballot Form Total

Particulars % Total
No. of No. of No. of valid
Remote No. of votes No. of votes
members votes cast members votes cast
E-voting cast(shares) cast (shares)
voted (shares) voted

Assent 78* 12,16,828 51 3,975 129 12,20,803 99.98

Dissent 3 159 2 91 5 250 0.02

Total 81 12,16,987 53 4,066 134 12,21,053 100

Invalid/Abstained 0 0 3 160 3 160 NA

• One shareholder has exercised and voted communicating Assent in respect of part of the shares held by him
Mr. Vijayakrishna K T, Practising Company Secretary was appointed as the scrutinizer for the conduct of Postal Ballot process. The
procedure prescribed under Section 110 of the Companies Act, 2013 read with the Companies (Management and Administration)
Rules, 2014, Secretarial Standard 2 and Regulation 44 of SEBI (LODR) Regulations, 2015 was followed for conduct of the Postal Ballot.
The results of the Postal Ballot were announced to the Stock Exchanges and displayed on the notice board at the Registered Office, on
the Company’s website at www.3m.com.in and on the website of Karvy at https://evoting.karvy.com pursuant to Section 108 of the
Companies Act, 2013 read with Rule 20 of the Companies (Management and Administration) Rules, 2014 on July 27, 2018.
There is one item requiring to be passed as a Special Resolution at the ensuing Annual General Meeting (AGM) to be held on August
14, 2019.
There is no business requiring Resolution by Postal Ballot at the ensuing Annual General Meeting (AGM) to be held on August 14, 2019.

Details of non-compliance by the Company, penalties, and strictures imposed on the Company by Stock Exchange or SEBI or any
statutory authority, on any matter related to capital markets, during the last three years:
There have been no instances of non-compliance by the Company on any matter related to listing agreement with the stock exchanges.

Compliance with Mandatory Requirements:

The Company has complied with all the mandatory requirements of the provisions of Listing Regulations. As regards the non-mandatory
requirements the extent of compliance has been stated in this report against each item.

Management Discussion and Analysis:

The Management Discussion and Analysis Report on the Company’s activities during the financial year is published as part of the
Company’s Annual Report. This report has been placed before the Company’s Audit Committee.

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Insider Trading:
Pursuant to Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015, the Company has formulated a
Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information.

The Company observes a closed period for trading in securities of the Company by the Directors/Officers and Designated Employees of
the Company for a period of seven days prior to the close of the quarter/half year/year and up to 24 hours after the date on which the
results for the respective quarter/half year/year and is notified to the Stock Exchanges.

Means of Communication:
Quarterly/half yearly/annual financial results are published in The Business Line (All India Edition) and PrajaVani (Bengaluru Edition).The
Company’s financial results and shareholding pattern are also displayed in the Company’s website at : http://solutions.3mindia.co.in/
wps/portal/3M/en_IN/about-3M/information/corporate/financial-facts/summary/ and are also notified to the Stock Exchanges as
required under the Listing Regulation. Shareholding pattern, Compliance on Corporate Governance and other Corporate Announcement
are uploaded in the NSE Electronic Application Processing System (NEAPS) and in BSE Listing Centre website. The Company has not
made any presentations to the Institutional Investors or to the Analysts.

Shareholders:
Details of the Directors seeking appointment/re-appointment at the ensuing AGM are provided in the Notice convening the AGM.

Secretarial Audit for Reconciliation of Capital:

Secretarial Audits were carried out periodically by a qualified Practising Company Secretary for reconciling the total admitted capital
with National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL) and the total issued and listed
capital. The audit confirms that the total issued/paid up capital is in agreement with the total number of Shares held in physical form
and the total number of dematerialized shares held with NSDL and CDSL. This audit is carried out every quarter and the report thereon
are submitted to the Stock Exchanges and is also placed before the Board of Directors.

NON-MANDATORY REQUIREMENTS

Chairman’s Office:
The Company has a Non-Executive Chairman. However, no separate Chairman’s office is maintained at the Company’s expense. The
Company has separate positions for Chairman and Managing Director.

Shareholders’ Rights:
Quarterly/half yearly/annual financial results are published in English Newspaper having a circulation all over India and in Kannada
newspaper (having circulation in Bengaluru). Significant events of the Company are being disclosed to the Stock Exchanges from time to
time. The Company’s financial results, shareholding pattern and other corporate announcements are also displayed in the Company’s
website: http://solutions.3mindia.co.in/wps/portal/3M/en_IN/about-3M/information/corporate/financial-facts/summary/ and
are also notified to the Stock Exchanges as per the provisions of Listing Regulations. The Company also displays in their website, the
quarterly report sent to the Stock Exchanges on the Compliance on Corporate Governance, Shareholding Pattern, quarterly financial
results and other corporate announcements. The Shareholding Pattern, Corporate Governance details and other quarterly compliances
and corporate announcements are uploaded in the NSE Electronic Application Processing System (NEAPS) and in BSE Listing Centre
website.

Audit qualifications:
During the financial year under review, there were no qualifications, reservations or adverse remarks made by the Statutory Auditors /
Secretarial Auditors in their respective Reports.

Reporting of Internal Auditor: The Company has an in-house Internal Auditor and reports to the Audit Committee.

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General Shareholder information:

Annual General Meeting August 14, 2019, (Wednesday)

Trinity Hall,
Taj MG Road,
41/3, Mahatma Gandhi Road,
Bengaluru – 560 001.
Time: 11.00 A.M.
Date of Book Closure August 10, 2019 (Saturday) - August 14, 2019 (Wednesday) (both days inclusive)
Cutoff date for eligibility for voting August 9, 2019 (Friday)
Remote e-voting period August 11, 2019 (Sunday) – August 13, 2019 (Tuesday)
Dividend payment date N. A.
Financial Results calendar Second week of August 2019 – Unaudited Results for the quarter and three months
ended June 30, 2019.
(Tentative)
First week of November 2019 – Unaudited Results for the quarter and six months ended
September 30, 2019.
First week of February 2020 – Unaudited Results for the quarter and nine months
ended December 31, 2019.
Last week of May 2020 – Audited Results for the year ended
March 31, 2020.
Listing on Stock Exchanges National Stock Exchange of India Limited (Code –3MINDIA)
BSE Limited (Code - 523395)
International Securities Identification INE470A01017
Number (ISIN )
Corporate Identification Number (CIN) L31300KA1987PLC013543

The Company has paid Annual Listing fees, as prescribed, to the National Stock Exchange of India Limited (NSE) and BSE Limited (BSE)
for the financial year 2019-20.

Annual Custody / Issuer Charges:

The Company has paid the Annual Custody fees for the financial year 2019-20 to Central Depository Services Limited (CDSL) and for the
financial year 2018-19 to National Securities Depository Limited (NSDL).

Registrar & Share Transfer Agents:

Share registration and other investor related activities are carried out by our Registrar and Transfer Agents, Karvy Computershare
Private Limited for both Physical and Demat securities. Their address is furnished below:
Karvy Fintech Private Limited (Formerly Karvy Computershare Private Limited)
Karvy Selenium Tower-B,
Plot Nos. 31 & 32, Financial District,
Gachibowli, Nanakramguda, Serilingampally,
Hyderabad- 500 032.
Ph: 040-67161524
E-mail: mailmanager@karvy.com., Website: www.karvycomputershare.com, Contact person: Mr. Rajeev Kumar.

Share Transfer System:

Shares sent for transfer in physical form are registered and dispatched within 30 days of receipt of the documents, if documents are
found to be in order. Shares under objection are returned within 30 days.
Monitoring of Share Transfers and other investor related matters are dealt with by the Stakeholders’ Relationship Committee. The
Company’s Registrars, Karvy Fintech Private Limited (Formerly Karvy Computershare Private Limited) process the share transfers in

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ANNEXURE ‘B’ TO REPORT OF THE BOARD OF DIRECTORS 3M India Limited

respect of physical securities on a fortnightly basis and the processed transfers are approved by the authorized Executives of the
Company also on a fortnightly basis.
All requests for dematerialization of shares, which are in order, are processed within 21 days and the confirmation is given to the
respective depositories, i.e., National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL).

Stock Price Data for the financial year 2018-19:

BSE Limited (BSE)) National Stock Exchange of India Limited (NSE)
Month No. of shares No. of shares
High (Rs.) Low (Rs.) High (Rs.) Low (Rs.)
traded traded
April 2018 21,110 19,430 3,899 21,136 19,400 29,899
May 2018 21,035 19,029 4,822 21,030 19,199 49,195
June 2018 20,349 18,214 4,383 20,298 18,251 32,785
July 2018 24,800 19,442 5,837 24,812 19,338 51,654
Month 3M Price Sensex
August 2018 26,200
Apr-18 24,068.00 23,241
35,160.00 8,454 26,459 23,220 1,02,267
September 2018 26,679
May-18 22,838.00 22,000
35,322.00 5,762 26,662 22,101 39,997
Jun-18 20,127.00 35,423.00
October 2018 23,700
Jul-18 20,851.00 19,150
37,607.00 10,177 23,800 19,015 47,051
November 2018 21,675
Aug-18 21,589.00 19,377
38,645.00 2,725 21,701 19,300 22,475
Sep-18 19,853.00 36,227.00
December 2018 23,615
Oct-18 22,440.00
19,700
34,442.00
18,071 23,795 19,644 76,220
January 2019 21,380
Nov-18 26,110.00 19,501
36,194.00 3,364 21,176 19,802 43,004
February 2019 Dec-18 23,436.00
24,471 36,068.00
20,256 4,167 24,500 20,160 55,802
Jan-19 19,630.00 36,257.00
March 2019 25,050
Feb-19 19,398.00 22,938
35,867.00 6,806 25,100 22,927 1,47,308
Mar-19 20,482.00 38,673.00
Stock Performance:
Min Price (Monthly Closing
BSE Sensex Vs 3M Share 19398.00
Price) 34442.00
Max 26110.00 38673.00

26500
38400
Month
25000 3M Price S&P CNX Nifty
Apr-18 20524.00 10739.00 37300
May-18
23500 19544.00 10736.00
Jun-18 19637.00 10714.00 36200
22000
Jul-18 23421.00 11357.00
Aug-18 25945.00 11681.00
20500 35100
Sep-18 22568.00 10930.00
Oct-18 19843.00 10387.00
19000
Nov-18 21634.00 10877.00 34000
Dec-19 20824.00 10863.00
Jan-19 20152.00 10831.00
Feb-19 22896.00 10793.00
Mar-19 24261.00 11624.00 3M Price Sensex

Min 19544.00 10387.00

NSE-S&P CNX Nifty VsMax
3M Share price (Monthly Closing
25945.00 11681.00Price)

26500
11750
25000
11400
23500 11050
22000 10700
20500 10350

19000 10000

3M Price S&P CNX Nifty

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ANNEXURE ‘B’ TO REPORT OF THE BOARD OF DIRECTORS 3M India Limited

Consolidated Shareholding Pattern as on March 31, 2019:

Category No. of Holders Total Shares % To Equity

Foreign Promoters 1 84,48,802 74.999996
Resident Individuals 20,742 10,91,941 9.693158
Foreign Portfolio - Corp 66 9,33,958 8.290743
Bodies Corporates 623 3,43,818 3.052072
Mutual Funds 24 2,46,311 2.186502
Alternative Investment Fund 11 65,021 0.577191
HUF 754 47,899 0.425199
Non-Resident Indian Non Repatriable 383 31,715 0.281534
Non-Resident Indians 572 29,468 0.261587
Nbfc 11 21,595 0.191699
Banks 2 3,437 0.030510
Trusts 5 422 0.003746
Clearing Members 43 420 0.003728
Foreign Institutional Investors 1 183 0.001624
Insurance Companies 1 60 0.000533
Nationalised Banks 1 20 0.000178
Total 23,240 1,12,65,070 100.00
* None of Foreign Promoter Shares has been pledged as on March 31, 2019

Pursuant to SEBI Circular No. Cir/ISD/3/2011 dated June 17, 2011, the Company has achieved 100% of Promoters’ shareholding in
dematerialized Form.

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ANNEXURE ‘B’ TO REPORT OF THE BOARD OF DIRECTORS 3M India Limited

Summary of Shareholding as on March 31, 2019:

Category No. of Holders Total Shares % To Equity

PHYSICAL 1,009 70,029 0.62

NSDL 14,375 1,07,49,761 95.43

CDSL 7,856 4,45,280 3.95

TOTAL 23,240 1,12,65,070 100.00

Top Ten (10) Members of the Company as on March 31, 2019:

Name of the Members No. of shares held % to paid-up capital Category

3M Company 84,48,802 74.999996 FPR

Acacia Partners, LP 2,10,000 1.864170 FPC
Acacia Conservation Fund LP 2,06,400 1.832212 FPC
Acacia Institutional Partners, LP 1,85,016 1.642387 FPC
Bright Star Investments Pvt Ltd 1,66,700 1.479796 LTD
Sbi Equity Hybrid Fund 1,30,000 1.154010 MUT
Acacia Banyan Partners 1,26,045 1.118901 FPC
IDFC Multi Cap Fund 95,099 0.844194 MUT
Govindlal M Parikh 40,115 0.356101 PUB
Nemish S Shah 25,000 0.221925 PUB
Total 96,33,177 85.513692

Distribution Schedule as on March 31, 2019:

Range of Shares No. of Cases % to Cases Amount (Rs.) % of Amount

1-5000 22,842 98.29 66,33,580 5.89
5001-10000 177 0.76 13,20,870 1.17
10001-20000 97 0.42 13,24,310 1.18
20001-30000 34 0.15 8,32,240 0.74
30001-40000 21 0.09 7,20,690 0.64
40001-50000 14 0.06 6,44,130 0.57
50001-100000 29 0.12 20,90,170 1.86
100001 and above 26 0.11 9,90,84,710 87.96
TOTAL 23,240 100.00 11,26,50,700 100.00

Dematerialization of Shares and Liquidity:

99.38 % of the total equity capital was held in dematerialised form as on March 31, 2019.

Outstanding GDRs / Warrants, Convertible Bonds, conversion date and likely impact on equity: Not Applicable

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ANNEXURE ‘B’ TO REPORT OF THE BOARD OF DIRECTORS 3M India Limited

Plant Locations:
1. Plot No. 48-51, Electronics City, Hosur Road, Bengaluru – 560 100.
2. Plot No.8, Moraiya Industrial Area; Tal Sanand, Sarkhej Bavla Highway, Ahmedabad –382 213.
3. Plot No. B-20, MIDC; Ranjagaon Industrial Area, Tal: Shirur, Pune- 412 210.

Branch Locations:
1. No.60-61, Udyog Vihar, Phase IV, Gurgaon, Haryana- 122001.
2. Nos.1-10-39 to 44, Gumidelli Towers, 8th Floor, Begumpet, Hyderabad – 500 016.
3. No.636/1, Seshachalam Centre, 11th Floor, Anna Salai, Nandanam, Chennai-600 035.
4. No. 2, Upper Wood Street, Kolkata-700 017.
5. No.1111, 1st Floor, Building 11, Solitaire Corporate Park, Chakala, Andheri, Ghatkopar Link Road, Andheri (East), Mumbai – 400
093
6. No. 145, Mumbai-Pune Road, Pimpri, Pune – 411 018.

Address for correspondence:

Corporate Office: Concorde Block, UB City, 24, Vittal Mallya Road, Bengaluru – 560 001

Designated e-mail id for redressal of investor complaints: investorhelpdesk.in@mmm.com

Compliance Officer: Mr. V. Srinivasan, Company Secretary. Inquiries, if any, may be addressed to the Compliance Officer.

CEO / CFO CERTIFICATION

We the undersigned, in our respective capacities as Managing Director and Chief Financial Officer of 3M India Limited (“the Company”)
certify that:
A. We have reviewed Financial Statements and the cash flow statement for the year ending March 31, 2019 and that to the best of
our knowledge and belief, we state that:
1. these statements do not contain any materially untrue statement or omit any material fact or contain statements that might
be misleading;
2. these statements together present a true and fair view of the company’s affairs and are in compliance with existing
accounting standards, applicable laws and regulations.
B. We further state that to the best of our knowledge and belief there are no transactions entered into by the company during the
year which are fraudulent, illegal or violative of the company’s code of conduct.
C. We are responsible for establishing and maintaining internal controls for financial reporting and that we have evaluated the
effectiveness of internal control systems of the company pertaining to financial reporting and have disclosed to the auditors and
the Audit Committee, deficiencies in the design or operation of such internal controls, if any, of which we are aware and the steps
we have taken or propose to take to rectify these deficiencies.
D. We have indicated to the Auditors and the Audit committee:
1. Significant changes in internal control over financial reporting during the financial year;
2. Significant changes in Accounting Policies during the financial year and that the same have been disclosed in the notes to
the financial statements; and
3. Instances of significant fraud of which we have become aware and the involvement therein, if any, of the management or
an employee having a significant role in the company’s internal control system over financial reporting.
Yours Faithfully,
Debarati Sen Mamta Janak Gore
Place : Bengaluru Managing Director Chief Financial Officer
Date : May 20, 2019 DIN: 07521172 PAN: AKIPG9089M

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CERTIFICATE OF COMPLIANCE
Certificate from Mr. Vijayakrishna K.T, Practising Company Secretary, Bengaluru confirming compliance with the conditions of Corporate
Governance as stipulated under Regulation 34 (3) of the Listing Regulations read with Schedule V is attached to the Board’s Report
forming part of the Annual Report. This Certificate shall be forwarded to the Stock Exchanges where the securities of the Company are
listed.
On behalf of the Board of Directors
Debarati Sen B.V. Shankaranarayana Rao
Place : Bengaluru Managing Director Whole-time Director
Date : May 28, 2019 DIN: 07521172 DIN: 00044840

AUDITORS’ CERTIFICATE ON COMPLIANCE WITH THE CONDITIONS OF CORPORATE GOVERNANCE UNDER SEBI (LODR)
REGULATIONS, 2015
To
The Members of
3M India Limited
Bangalore
I have examined the compliance of the conditions of Corporate Governance by 3M India Limited for the year ended 31st March, 2019 as
stipulated in Chapter IV of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015.
The compliance of the conditions of Corporate Governance is the responsibility of the Management. My examination was limited
to procedures and implementation thereof, adopted by the Company for ensuring the compliance of the conditions of Corporate
Governance. It is neither an audit nor an expression of opinion on the financial statements of the Company.
In my opinion and to the best of my information and explanations given to me, I certify that the Company has complied with the
conditions of Corporate Governance as stipulated in the provisions as stipulated in the provisions as specified in Chapter IV of SEBI
(Listing Obligations and Disclosure Requirements) Regulations, 2015 pursuant to Listing Agreement of the said Company with Stock
Exchanges.
I further state that such compliance is neither an assurance as to the future viability of the Company nor the efficiency or effectiveness
with which the Management has conducted the affairs of the Company.
Vijayakrishna K.T
Practising Company Secretary
Place : Bangalore FCS- 1788
Date : 28-05-2019 CP-980

CERTIFICATE OF NON-DISQUALIFICATION OF DIRECTORS

(Pursuant to Regulation 34(3) and Schedule V Para C clause (10)(i) of the SEBI
(Listing Obligations and Disclosure Requirements) Regulations, 2015)
To
The Members
3M INDIA LIMITED
Plot No 48-51, Electronic City,
Hosur Road,
Bangalore 560100
I have examined the relevant registers, records, forms, returns and disclosures received from the Directors of 3M INDIA LIMITED
having CIN L31300KA1987PLC013543 and having Registered Office at Plot No 48-51, Electronic City, Hosur Road, Bangalore 560100
(hereinafter referred to as ‘the Company’), produced before me by the Company for the purpose of issuing this Certificate, in accordance
with Regulation 34(3) read with Schedule V Para-C Sub clause 10(i) of the Securities Exchange Board of India (Listing Obligations and
Disclosure Requirements) Regulations, 2015.

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ANNEXURE ‘B’ TO REPORT OF THE BOARD OF DIRECTORS 3M India Limited

In my opinion and to the best of my information and according to the verifications (including Directors Identification Number (DIN)
status at the portal www.mca.gov.in) as considered necessary and explanations furnished to me by the Company & its officers, I hereby
certify that none of the Directors on the Board of the Company as stated below for the Financial Year ended on 31st March, 2019 has
been debarred or disqualified from being appointed or continuing as Directors of companies by the Securities and Exchange Board of
India, the Ministry of Corporate Affairs, or any such other Statutory Authority:

Sr. No. Name of Director DIN Date of appointment in Company

1. Banwaraviashnatharao
Shankaranarayana Rao 0000044840 23/02/2003
2. Amit Laroya 0000098933 01/10/2013
3. Bharat Dhirajlal Shah 0000136969 27/03/2015
4. Radhika Govind Rajan 0000499485 27/05/2016
5. Sadhana Kaul 0002589934 31/10/2018
6. Biren Chandrakant Gabhawala 0003091772 05/08/2014
7. Jongho Lee 0006720950 26/05/2017
8. Ramadurai Ramesh 0007109252 27/03/2015
9. Debarati Sen 0007521172 01/06/2016
Ensuring the eligibility of for the appointment / continuity of every Director on the Board is the responsibility of the Management of
the Company. My responsibility is to express an opinion on these based on my verification. This certificate is neither an assurance as to
the future viability of the Company nor of the efficiency or effectiveness with which the management has conducted the affairs of the
Company.
Vijayakrishna K.T
Practising Company Secretary
Place : Bangalore FCS- 1788
Date : 28-05-2019 CP-980

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ANNEXURE ‘C’ TO REPORT OF THE BOARD OF DIRECTORS 3M India Limited

BUSINESS RESPONSIBILITY REPORT

[As per Regulation 34(2) (f of SEBI (LODR) Regulations, 2015]

SECTION A: GENERAL INFORMATION ABOUT THE COMPANY

1. Corporate Identity Number (CIN) of the Company: L31300KA1987PLC013543
2. Name of the Company: 3M INDIA LIMITED
3. Registered address:
PLOT NOS.48-51, ELECTRONICS CITY, HOSUR ROAD, BANGALORE – 560 100
4. Website: www.3m.com/in
5. E-mail id: investorhelpdesk.in @mmm
6. Financial Year reported: 2018-19
7. Sector(s) that the Company is engaged in (industrial activity code-wise):
3290 – Other manufacturing n.e.c (as per NIC 2008)
8. List three key products/services that the Company manufactures/provides(as in Balance Sheet):
Abrasive, Fusion bonded epoxy coating and Self- adhesive tapes
9. Total number of locations where business activity is undertaken by the Company
(a) Number of International Locations (Provide details of major 5): Nil
(b) Number of National Locations: 3 Plants and 6 Branch Locations across India
10. Markets served by the Company – Local, State, National and International

SECTION B: FINANCIAL DETAILS OF THE COMPANY (as at March 31, 2019)

1. Paid up Capital (INR): 1,126.51 lakhs
2. Total Turnover (INR): 280,875.97 lakhs
3. Total profit after taxes (INR): 32,286.31 Lakhs
4. Total Spending on Corporate Social Responsibility (CSR) as percentage of profit after tax (%): 2.38%
5. List of activities in which expenditure in 4 above has been incurred:-
(a) Education
(b) Social Innovation
(c) Women Empowerment
(d) National Calamity
(e) Sustainability

SECTION C: OTHER DETAILS

1. Does the Company have any Subsidiary Company/ Companies? Yes
2. Do the Subsidiary Company/Companies participate in the BR Initiatives of the parent Company? If yes, then indicate the number
of such subsidiary Company(s): Yes, one
3. Do any other entity/entities (e.g. suppliers, distributors etc.) that the Company does business with, participate in the BR initiatives
of the Company? If yes, then indicate the percentage of such entity/entities? [Less than 30%, 30-60%, More than 60%]:
The Company collaborates with all relevant stakeholders by sharing its Ethical Business Practices, Code of Conduct, Anti-Bribery
Policy and Supplier Code of Conduct with its contract manufacturers, suppliers and other major third parties associated with the
Company.
SECTION D: BR INFORMATION
1. Details of Director/Directors responsible for BR

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ANNEXURE ‘C’ TO REPORT OF THE BOARD OF DIRECTORS 3M India Limited

(a) Details of the Director/Director responsible for implementation of the BR policy/policies

1. DIN Number: 00044840
2. Name: B.V. Shankaranarayana Rao
3. Designation: Whole-time Director
(b) Details of the BR head:

No. Particulars Details

1 DIN Number (if applicable) 00044840
2 Name B.V. Shankaranarayana Rao
3 Designation Whole-time Director
4 Telephone number 080- 30614801
5 e-mail id rshankar@mmm.com
2. Principle-wise (as per NVGs) BR Policy/policies:
The National Voluntary Guidelines on Social, Environmental and Economic Responsibilities of Business (NVGs) released by the
Ministry of Corporate Affairs has adopted nine (9) areas of Business Responsibility as under-
P1 Businesses should conduct and govern themselves with Ethics, Transparency and Accountability
P2 Businesses should provide goods and services that are safe and contribute to sustainability their life cycle
P3 Businesses should promote the wellbeing of all employees
P4 Businesses should respect the interests of, and be responsive towards all stakeholders, especially those who are
disadvantaged, vulnerable and marginalized
P5 Businesses should respect and promote human rights
P6 Businesses should respect, protect and make efforts to restore the environment
P7 Businesses, when engaged in influencing public and regulatory policy, should do so in a responsible manner
P8 Businesses should support inclusive growth and equitable development
P9 Businesses should engage with and provide value to their customers and consumers in a responsible manner
(a) Details of compliance (Reply in Y/N)

Customer Responsibility
Equitable Development
Employees‘ well being
Stakeholders’ welfare

Regulatory Policy
Business Ethics

Human Rights
Sustainability

Environment

No. Questions

P P P P P P P P P
1 2 3 4 5 6 7 8 9
1 Do you have a policy/ policies for. Y Y Y Y Y Y N Y Y
Has the policy being formulated in consultation with the relevant
2 - - Y - - Y - - -
stakeholders?
Does the policy conform to any national / international standards? If
3 - - - - Y - - -
yes, specify? (50 words)$

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ANNEXURE ‘C’ TO REPORT OF THE BOARD OF DIRECTORS 3M India Limited

Has the policy being approved by the

4 Board? If yes, has it been signed by MD/ - - - - - - - Y -
owner/ CEO/ appropriate Board Director?*
Does the Company have a specified
5 committee of the Board/ Director/ Y - Y - - - - Y -
Official to oversee the implementation of the policy?
http://solutions.3mindia.co.in/wps/
6 Indicate the link for the policy to be viewed online @ portal/3M/en_IN/about-3M/information/
corporate/financial-facts/summary/
Has the policy been formally communicated to all relevant internal and
7 Y Y Y Y Y Y - Y Y
external stakeholders?
Does the Company have in-house structure to implement the policy/
8 Y Y Y Y Y Y - Y Y
policies?
Does the Company have a grievance redressal mechanism related to
9 the policy/ policies to address stakeholders’ grievances related to the Y Y Y Y Y Y - Y Y
policy/ policies?
Has the Company carried out independent audit/ evaluation of the
10 - - Y - - Y - - -
working of this policy by an internal or external agency?
$ -ISO 14001, @-except for P7
* -3M India Ltd has a globally accepted Code of Conduct policy approved by the CEO of the Parent Company, 3M Company, U.S.A.
which is also followed by the Company, being one of its subsidiaries.
(b) If answer to the question at serial number 1 against any principle, is ‘No’, please explain why: (Tick up to 2 options)

P P P P P P P P P
No. Questions
1 2 3 4 5 6 7 8 9
1 The Company has not understood the Principles - - - - - - - - -
The Company is not at a stage where it finds itself in a position
2 - - - - - - - - -
to formulate and implement the policies on specified principles
The Company does not have financial or manpower resources
3 - - - - - - - - -
available for the task
4 It is planned to be done within next 6 months - - - - - - - - -
5 It is planned to be done within the next 1 year - - - - - - - - -
6 Any other reason (please specify)# - - - - - - √ - -
# The Company through various Industry Forums endeavors for economic reforms and inclusive sustainable business principles.
Therefore, the Company currently does not find it necessary to frame a policy on principle #7.
3. Governance related to BR
(a) Indicate the frequency with which the Board of Directors, Committee of the Board or CEO to assess the BR performance of
the Company. Within 3 months, 3-6 months, Annually, More than 1 year:
Assessment is an ongoing exercise and is an inherent part of corporate function. BR Committee comprises the Whole-time
Director, who heads the Committee and three senior managerial personnel, including the Managing Director.
(b) Does the Company publish a BR or a Sustainability Report? What is the hyperlink for viewing this report? How frequently it
is published?
This is the Third Business Responsibility Report. It is available also at http://solutions.3mindia.co.in/wps/portal/3M/en_IN/
about-3M/information/corporate/financial-facts/summary/. and forms part of Annual report. The Global sustainability
report can be accessed at http:// www.3m.com/sustainabilityreport.

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SECTION E: PRINCIPLE-WISE PERFORMANCE

Principle 1-Businesses should conduct and govern themselves with Ethics, Transparency and Accountability
1. Does the policy relating to ethics, bribery and corruption cover only the Company? Yes/ No. Does it extend to the Group/Joint
Ventures/ Suppliers/Contractors/NGOs /Others?
The Company’s Code of Conduct is based primarily on the Code of Conduct of 3M Company, USA, the holding/ Parent Company,
which is followed by all 3M Group Companies. The Code has to be adhered by all other stakeholders who do business with the
Company.
3M’s Code of Conduct is comprised of our core business conduct principles that set forth global corporate expectations for all 3M
employees and certain third parties who act on 3M’s behalf. 3M’s Code of Conduct applies to all “3M People.” 3M People are 3M’s
employees and may include others who act on 3M’s behalf. 3M People are expected to live 3M Values. All 3M People are partners
in complying with 3M’s Code of Conduct and supporting others’ compliance. Together, 3M People ensure the continued success
of 3M Company and protect 3M’s longstanding reputation for doing the right thing, always and everywhere.
2. How many stakeholder complaints have been received in the past financial year and what percentage was satisfactorily resolved
by the management? If so, provide details thereof, in about 50 words or so.
i. No. of complaints received in Ethics point = 25
No. of complaints resolved = 13
ii. No. of complaints received from shareholders = 43
No. of complaints resolved = 33

Principle 2- Businesses should provide goods and services that are safe and contribute to sustainability throughout their life cycle.
1. List up to 3 of your products or services whose design has incorporated social or environmental concerns, risks and/or
opportunities.
(a) Product Name: Scotch Brite Broom
Product Technical description/ Features/ Benefits:
Scotch Brite brooms are used to sweep floors. Broom consists of Polypropylene Handle with Polypropylene Film spirally wound on
four Polypropylene Stems that is attached to a detachable Polypropylene Handle with the help of a connector. The specialty of the
broom lies in its flat fibers and friendly design which removes even fine dust and hair giving the flexibility to users to reach corners
with less back strain. Product lasts longer than traditional Grass Broom & Competition synthetic broom. Detachable handle which
can be reused with new cleaning head refills. Cleaning head is washable & product lasts longer offering sustainable benefit during
product use. Lesser use of packaging material due to detachable head design.
Environmental / Social benefits:
1. Entire Product is manufactured from virgin polymers which can be recycled post end of life.
2. Product is lightweight, hence less polymer used for manufacturing & ergonomically designed to reduce stress during use.
3. Shift to Hot Melt bonding from currently used tape bonding – eliminate solvents & reduce energy.
4. Additives are used to bring down polymer weight without impacting product life & performance. The product is Light-
weight resulting in less polymer used & ergonomically designed offering lesser strain during use.
(b) Product Name: 3M Scotchkote EA5WB [Black Color]
Product Technical description/ Features/ Benefits:
3M Scotchkote EA5WB is a waterborne epoxy primer for Railway Bogie, underframe and underslung components. This is a zinc
phosphate containing coating for high performance corrosion protection. The product provides proven long-term anticorrosion
property (up to 2000 Hrs. of salt spray resistance) and having excellent anti-chip and fire resistance properties. This product has
application in original equipment manufacturers (OEMs), particularly within water, rail, automotive and commercial transport
industries.
Environmental/Social benefits:
3M Scotchkote EA5WB being waterborne coating provides a 120g/L VOC reducing the exposure risk of VOC’s to the applicators
during processing and application of coating. Being waterborne in nature the thinner used for application is water, so it further

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reduces total VOC of the coating during application. The release of volatile organic compounds in environment is very low so the
product helps in maintaining a sustainable environment for living compared to solvent-borne coating solutions.
(c) Product Name: 3M Scotchkote EA9WB [White Color]
Product Description/Features/Benefits:
Waterborne anticorrosion epoxy coating EA9WB is applied both as primer and finish coat. The product is applied widely in
Railways, Metro, OEMs and other heavy engineering fabrication as well as in civil engineering works e.g. transformers [exterior &
interior] etc. It has proven long term corrosion protection property [upto 1000 Hrs. of salt spray resistance] and complies BS476-6
& 7 fire rating. The product is having high chemical resistance to aqueous solution of industrial chemicals.
Environmental/Social benefits:
3M Scotchkote EA9WB being waterborne coating provides a 76.5 g/L VOC which reduced the VOC exposure risk during the
processing and application of coating. Being waterborne in nature the thinner used for application is water, so it further reduces
total VOC of the coating during application. The release of volatile organic compounds in environment is very low so the product
helps in maintaining a sustainable environment for living compared to solvent-borne coating.
2. For each such product, provide the following details in respect of resource use (energy, water, raw material etc.) per unit of
product(optional):
a. Reduction during sourcing/production/ distribution achieved since the previous year throughout the value chain? Refer
point no. 1 above
b. Reduction during usage by consumers (energy, water) has been achieved since the previous year? Refer point no. 1 above
3. Does the Company have procedures in place for sustainable sourcing (including transportation)?
If yes, what percentage of your inputs was sourced sustainably? Also, provide details thereof, in about 50 words or so.
Yes, the Company has procedures in place for sustainable sourcing, covering areas such as standardized processes for supplier’s
audits for EHS compliance including conflict Minerals, Paper and pulp and frugal automation to improve sustainability of materials
procured. Manufacturing process are selected and improved year on year to consume less energy and resource. The Company
has also reduced the transportation cost over the years through various methods.
4. Has the Company taken any steps to procure goods and services from local & small producers, including communities surrounding
their place of work?
If yes, what steps have been taken to improve their capacity and capability of local and small vendors?
The Company as a policy ensures localization and outsourcing for each of the plants with suppliers who are competitive as well
as close to the plants. Localized vendors are preferred, if they meet the quality specifications and EHS Compliance. Technology
Investment by suppliers for new products are encouraged by the Company and thereby focusses on increasing the capacity of its
suppliers.
5. Does the Company have a mechanism to recycle products and waste? If yes what is the percentage of recycling of products and
waste (separately as <5%, 5-10%, >10%). Also, provide details thereof, in about 50 words or so.
3M has a World class program called “Pollution Prevention Pays “popularly known as “3P program “where every effort is a
made right from the design stage to reduce waste. Used oil is recycled through authorized recyclers. Spent solvents are recycled
through authorized recyclers. Powder residue collected through dust collectors is recycled into product. About 1000 MT of wastes
having high calorific value are sent to approved & authorized cement industry for coprocessing as an alternate fuel/ Raw material.
This helped in reducing the use of coal (fossil fuel) used as Raw materials for cement kilns and helped in reduction of carbon
footprint of 2825MT of CO2 per year.

Principle 3- Businesses should promote the wellbeing of all employees

1. Please indicate the Total number of employees.
1,377 employees as on March 31, 2019
2. Please indicate the Total number of employees hired on temporary/contractual/casual basis.
710 employees as on March 31, 2019
3. Please indicate the Number of permanent women employees.
162 women employees as on March 31, 2019

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ANNEXURE ‘C’ TO REPORT OF THE BOARD OF DIRECTORS 3M India Limited

4. Please indicate the Number of permanent employees with disabilities

Nil
5. Do you have an employee association that is recognized by management?
The Company does not have union for the employees
6. What percentage of your permanent employees is members of this recognized employee association?
Not Applicable
7. Please indicate the Number of complaints relating to child labour, forced labour, involuntary labour, sexual harassment in the last
financial year and pending, as on the end of the financial year.

No of complaints filed during No of complaints pending as on

No. Category
the financial year end of the financial year
1 Child labour/forced labour/involuntary labour Nil Nil

2 Sexual harassment 2 Nil

3 Discriminatory employment Nil Nil

8. What percentage of your under mentioned employees were given safety & skill up-gradation training in the last year?
(a) Permanent Employees 100%
(b) Permanent Women Employees 100%
(c) Casual/Temporary/Contractual Employees 100%
(d) Employees with Disabilities Nil

Principle 4- Businesses should respect the interests of and be responsive towards all stakeholders, especially those who are
disadvantaged, vulnerable and marginalized
1. Has the Company mapped its internal and external stakeholders? Yes
2. Out of the above, has the Company identified the disadvantaged, vulnerable & marginalized stakeholders: Yes
3. Are there any special initiatives taken by the Company to engage with the disadvantaged, vulnerable and marginalized
stakeholders? If so, provide details thereof, in about 50 words or so.
Yes, the Company works with various NGO partners in the following areas to engage with disadvantaged, vulnerable and
marginalized stakeholders –
• Improving the infrastructure and learning environment in Government Anganwadis, part of Govt. of India’s ICDS program,
to help children under the age of 6 years be school ready in cities such as - Kolkata, Bengaluru, Pune, Ahmedabad, Chennai,
Delhi, Gurgaon and Mumbai.
• Strengthening the skills set of women community healthcare workers in Rajasthan and Uttar Pradesh through topics related
to disease prevention and health promotion.
• Supporting the primary education of first-generation girl children in Government Schools in tribal areas in Ambegaon
district in Pune.

Principle 5 – Businesses should respect and promote human rights

1. Does the policy of the Company on human rights cover only the Company or extend to the Group/Joint Ventures/Suppliers/
Contractors/NGOs/Others?
The Company’s Code of Conduct is based primarily on the Code of Conduct of the 3M Company, USA, which is followed by all
the entities in the 3M Group worldwide. The principle of the Code of Conduct is expected to be adhered by other stakeholders
including customers and vendors.
2. How many stakeholder complaints have been received in the past financial year and what percent was satisfactorily resolved by
the management? Nil

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ANNEXURE ‘C’ TO REPORT OF THE BOARD OF DIRECTORS 3M India Limited

Principle 6-Business should respect, protect and make efforts to restore the environment
1. Does the policy related to Principle 6 cover only the Company or extends to the Group/Joint Ventures/Suppliers/Contractors/
NGOs/others?
The Company’s EHS Policy is based primarily on the EHS Policy of 3M Company, USA, the Parent / Holding Company, which is
followed by all 3M Group Companies worldwide. The EHS Policy has to be adhered by all other stakeholders who do business with
the Company.
2. Does the Company have strategies/ initiatives to address global environmental issues such as climate change, global warming,
etc.? Y/N. If yes, please give hyperlink for webpage etc. Yes, http://www.3m.com/3M/en_US/sustainability-report/
3. Does the Company identify and assess potential environmental risks?
Yes, The Risks pertaining to Environment are assessed through a proper Aspect Impact Assessment as per ISO 14001: 2015
Guidelines
4. Does the Company have any project related to Clean Development Mechanism? If so, provide details thereof, in about 50 words
or so. Also, if Yes, whether any environmental compliance report is filed?
We are reducing the carbon footprint of the facility by sending the waste streams to a coprocessing kilns which will enables the
cement kilns to reduce the Fossil fuel usage at their facility and at the same time we at 3M reduce the inhouse fuel consumption by
not opting for Diesel fired incineration. Also, two (2) of the manufacturing plants are utilizing 24% share of its energy consumption
through renewable energy there by contributing for the reduction in carbon footprint.
5. Has the Company undertaken any other initiatives on – clean technology, energy efficiency, renewable energy, etc., Y/N. If yes,
please give hyperlink for web page etc.
Yes: http://www.3m.com/3M/en_US/sustainability-report/
- Waste generation reduced by 20.91%
- Water consumption reduced by 57.01%
- Energy Consumption reduced by 28.11%
- Two (2) of the manufacturing plants are utilizing 24% share of its energy consumption through renewable energy there by
contributing for the reduction in carbon footprint.
- Waste generated at Plants is majorly sent for co processing in cement kilns thereby reducing the carbon footprint of the
sites.
- All plants have sewage / waste water treatment plants and the treated water is recycled for cooling tower make and
horticulture with in the facilities. The plants have also installed rain water harvesting systems to divert the rain water for
ground water recharging. With the approval from local Pollution Control Boards, plants continued sending non-hazardous
waste to cement companies to generate energy. As part of World Environmental day initiative, the plants have taken up
various environmental awareness programs including tree plantation in plants as well as public location.
6. Are the Emissions/Waste generated by the Company within the permissible limits given by CPCB/SPCB for the financial year being
reported?
Yes, well within the permissible limits mentioned in the respective Plant’s Consent order’s / Authorizations.
7. Number of show cause/ legal notices received from CPCB/SPCB which are pending (i.e. not resolved to satisfaction) as on end of
Financial Year.
None

Principle 7-Businesses, when engaged in influencing public and regulatory policy, should do so in a responsible manner
1. Is your Company a member of any trade and chamber or association? If Yes, Name only those major ones that your business deals
with:
(a) Confederation of Indian Industries (CII)
(b) American Chamber of Commerce in India (AMCHAM)
(c) National HRD Network
(d) Bangalore Chamber of Commerce (BCC)

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ANNEXURE ‘C’ TO REPORT OF THE BOARD OF DIRECTORS 3M India Limited

2. Have you advocated/lobbied through above associations for the advancement or improvement of public good? Yes/No; if yes
specify the broad areas (drop box: Governance and Administration, Economic Reforms, Inclusive Development Policies, Energy
security, Water, Food Security, Sustainable Business Principles, Others)
Yes, on the following broad areas:
a. Road Safety
b. Industrial Safety for factory workers
c. Healthcare Skills Development
d. Government Supported Incubation Centers

Principle 8-Businesses should support inclusive growth and equitable development.

1. Does the Company have specified programmes/initiatives/projects in pursuit of the policy related to Principle 8? If yes details
thereof.
The Company has programmes, inter alia, for providing Education, Social Innovation, Women empowerment and Sustainability.
2. Are the programmes/projects undertaken through in-house team/own foundation/external NGO/government structures/any
other organization?
The programmes / projects are implemented through a Charitable Trust, United Way of Bengaluru.
3. Have you done any impact assessment of your initiative?
The Company has tied up with Goodera Platform for impact study.
4. What is your Company’s direct contribution to community development projects- Amount in INR and the details of the projects
undertaken?
For details, please refer Annual Report on CSR activities section.
5. Have you taken steps to ensure that this community development initiative is successfully adopted by the community? Please
explain in 50 words, or so.
Not Applicable

Principle 9 – Businesses should engage with and provide value to their customers and consumers in a responsible manner
1. What percentage of customer complaints/consumer cases are pending as on the end of financial year.
There is 1 consumer case pending in different consumer courts/forums as on the end of the financial year and the same are sub-
judice.
% age of Customer complaints pending = 2.39% (from CARes data system)
2. Does the Company display product information on the product label, over and above what is mandated as per local laws? Yes/
No/N.A. /Remarks (additional information)
Yes, apart from the mandated declarations, additional declarations are furnished on the products / labels relating to the products
and their safe usage and disposal.
3. Is there any case filed by any stakeholder against the Company regarding unfair trade practices, irresponsible advertising and/or
anti-competitive behavior during the last five years and pending as on end of financial year? If so, provide details thereof, in about
50 words or so.
No
6. Did your Company carry out any consumer survey/ consumer satisfaction trends?
Yes
On behalf of the Board of Directors
Debarati Sen B.V. Shankaranarayana Rao
Place : Bengaluru Managing Director Whole-time Director
Date : May 28, 2019 DIN: 07521172 DIN: 00044840

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ANNEXURE ‘D’ TO REPORT OF THE BOARD OF DIRECTORS 3M India Limited

Disclosure pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies
(Appointment & Remuneration of Managerial Personnel) Rules, 2014:
1. The number of permanent employees on the rolls of
1,377 permanent employees as at March 31, 2019
Company.
2. The ratio of the remuneration of each Director to Key Managerial Personnel’s:
the median remuneration of the employees of the 1. Managing Director = 41.61
Company for the financial year 2018-19.
2. Whole-time Director= 17.04
3. Chief Financial officer = 27.52
4. Company Secretary = 3.47
Independent Directors:
1. Mr. Bharat Shah= 1.46
2. Mr. Biren Gabhawala= 1.43
3. Ms. Radhika Rajan = 1.38
Median remuneration of employees = Rs. 12,72,323 for the financial
year 2018-19
Note: The expression Median means the numerical value separating
the higher half of a population from the lower half and the median of
a fine list of numbers may be found by arranging all the observations
from the lowest value to highest value and picking the middle one
and if there is an even number of observations, the median shall be
the average of the two middle values.
3. The percentage increase in remuneration of each Managing Director = 2%
Director, Chief Financial Officer, Chief Executive Officer,
Whole-time Director = Nil
Company Secretary or Manager, if any, in the financial
year 2018-19 Chief Financial Officer= 4%
Company Secretary = 3%
4. The percentage increase in the median remuneration
of employees in the financial year 2018-19. 6.2%
5. Average percentile increase already made in the salaries FY 2017-18= 10.70%
of employees other than the managerial personnel in
FY 2018-19 = 6.2%
the last financial year (2017-18) and its comparison with
the percentile increase in the managerial remuneration Average increase in the remuneration of the employees other than
and justification thereof and point out if there are any the Managerial Personnel and that of the Managerial Personnel is in
exceptional circumstances for increase in the managerial line with the Industry practice and is within the normal range.
remuneration.
6. Affirmation that the remuneration is as per the
remuneration policy of the Company. Yes

On behalf of the Board of Directors

Debarati Sen B.V. Shankaranarayana Rao
Place : Bengaluru Managing Director Whole-time Director
Date : May 28, 2019 DIN: 07521172 DIN: 00044840

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ANNEXURE ‘E’ TO REPORT OF THE BOARD OF DIRECTORS 3M India Limited

FORM NO. AOC.2

Form for disclosure of particulars of contracts/arrangements entered into by the company with related parties referred to in sub-
section (1) of section 188 of the Companies Act, 2013 including certain Arm’s length transactions under third proviso thereto.
(Pursuant to clause (h) of sub-section (3) of section 134 of the Act and Rule 8(2) of the Companies (Accounts) Rules, 2014).
1. Details of contracts or arrangements or transactions not at arm’s length basis - Nil
(a) Name(s) of the related party and nature of relationship- Nil
(b) Nature of contracts/arrangements/transactions- Nil
(c) Duration of the contracts/arrangements/transactions- Nil
(d) Salient terms of the contracts or arrangements or transactions including the value, if any- Nil
(e) Justification for entering into such contracts or arrangements or transactions- Nil
(f) Date(s) of approval by the Board- Nil
(g) Amount paid as advances, if any: - Nil
(h) Date on which the special resolution was passed in general meeting as required under first proviso to section 188- Nil
2. Details of material contracts or arrangement or transactions at Arm’s length basis
(a) Name(s) of the related party and nature of relationship - 3M Company, USA, Holding (Parent) Company of the Company
(b) Nature of contracts/arrangements/transactions –

Sl No. Nature of Transactions

1. Income from Contract Research
2. Sale of Goods
3. Purchases of Materials
4. Royalty
5. Re-charge (Net)
6. Corporate Management Fee

The above transactions are in the ordinary course of business and are on an arm’s length basis.
(c) Duration of the contracts/arrangements/transactions – ongoing, will be continuous year on year.
(d) Salient terms of the contracts or arrangements or transactions including the value, if any-

Sl No. Nature of Transactions Salient Terms

1. Income from Contract Research billing in USD on a yearly basis

2. Sale of Goods billing in USD, receipt within 15 days from end of the month

3. Purchases of Materials billing in USD, payment to be made within 15 days from end of the month

4. Royalty billing in USD, on a quarterly basis

5. Re-charge (Net) billing in USD, payment/receipt within 15 days from the end of the month

6. Corporate Management Fee billing in USD, yearly

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ANNEXURE ‘E’ TO REPORT OF THE BOARD OF DIRECTORS 3M India Limited

(Rs. in lakhs)

Actual value of transactions for the Financial

Sl No. Nature of Transactions
Year 2018-19 (standalone)

1. Income from Contract Research 2,658.91

2. Sale of Goods 2,696.80
3. Re-charge of expenses received 4,687.94
Total 10,043.65
1. Purchases of Materials 88,600.44
2. Royalty 5,096.23
3. Re-charge of expenses paid 950.55
4. Corporate Management Fee 12,713.33
Total 107,360.55
Terms and Conditions for the transaction are in ordinary course of business and on arm’s length basis, which is same for the
entire 3M group companies throughout the world.
(e) Date(s) of approval by the Audit Committee –Omnibus approval for the estimated value of the transactions for the year 2018-19
was obtained at the meeting held on May25, 2017 and review of the actual transactions versus the estimated at the meetings
held on August 9, 2018, October 30, 2018, February 12, 2019 and May 28, 2019.
(f) Amount paid as advances, if any – Nil
On behalf of the Board of Directors
Debarati Sen B.V. Shankaranarayana Rao
Place : Bengaluru Managing Director Whole-time Director
Date : May 28, 2019 DIN: 07521172 DIN: 00044840

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ANNEXURE ‘F’ TO REPORT OF THE BOARD OF DIRECTORS 3M India Limited

ANNUAL REPORT ON CSR ACTIVITIES FOR THE YEAR 2018-19

1. A brief outline of the Company’s CSR policy, including overview of projects or programs proposed to be undertaken and a
reference to the web-link to the CSR policy and projects or programs.
Objectives
 To engage in outcome-based Corporate Social Responsibility programs that will impact and enrich the communities around
the Company’s areas of operation.
 To engage 3M India Limited employees to develop social empathy and contribute to the Company’s corporate social
responsibility initiatives.
 In line with the Company’s core values, 3M India Limited CSR strategy will focus on the following three (3) areas:
EDUCATION:
In education, 3M India intervenes at three levels:
 Early child education and development through a sustained intervention at Government Anganwadis to build readiness
among children under the age of 6 to attend school and be scholars through their growing years.
 Building science as a life skill through creative and engaging education models that stimulate a spirit of inquiry and creative
thinking critical to building the foundation for innovation capability.
 Supporting young scientists, social innovators and entrepreneurs with grants who are working to solve India’s problems
with innovative solutions with a social relevance.
COMMUNITY:
 3M India’s community efforts are aimed at improving lives in communities around areas we operate and have a presence,
with interventions ranging from education, sanitation, skills development, income generation to initiatives to promote
public health and safety. 3M India’s response to community interventions during times of natural disasters also come under
the community initiatives.
ENVIRONMENT:
 In line with 3M’s Global Sustainability Goals, 3M India contributes to interventions around the theme of water conservation
through initiatives such as rain water harvesting to address drinking water needs in rural homes and to support agricultural
needs. Other interventions include water conversation efforts around city lake development programs.
 CSR policy is been displayed at: http://solutions.3mindia.co.in/wps/portal/3M/en_IN/about-3M/information/corporate/
financial-facts/summary/.

2. The Composition of the CSR Committee.

 Mr. Bharat D Shah Chairman
 Ms. Debarati Sen Member
 Mr. B.V. Shankaranarayana Rao Member
 Mr. Ramesh Ramadurai Member

3. Average Net Profit of the Company for last three financial years
Average of the last 3 financial years= Rs. 38,400.16 Lakhs

4. Prescribed CSR Expenditure (two per cent (2%) of the amount as in item 3 above)
Rs. 768.00 Lakhs

5. Details of CSR spent during the financial year.

Total amount spent for the financial year = Rs. 770.01 Lakhs

6. Amount unspent, if any.

NA

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ANNEXURE ‘F’ TO REPORT OF THE BOARD OF DIRECTORS 3M India Limited

7. Manner in which the amount spent during the financial year is detailed below:
(1) (2) (3) (4) (5) (6) (7) (8)

S. CSR project or Sector in which the Project is Projects or Amount Amount spent Cumulative Amount spent:
No activity Identified covered Programs: 1. Local outlay (budget) on the projects expenditure Direct or through
area or other project or or Programs Sub up to to the implementing
2. Specify the programs wise heads: 1. Direct reporting period agency *
State and district expenditure
where projects on projects or
or programs was programs
undertaken 2. Overheads
1. Education 1. Support school readiness Bengaluru, Rs. 304 Lakhs Rs. 2,97,21,780 Rs. 2,97,21,780 Through
initiative to enhance the Karnataka, Kolkata, implementing
holistic development of West Bengal, agency – United
11,000 children in 130 Mumbai & Pune, Way Bengaluru
Anganwadis across 8 cities Maharashtra,
Ahmedabad,
Gujarat, Delhi &
Gurgaon, NCR,
Chennai, Tamil
Nadu

2 Project Nanhi Kali: Girl Child Pune, Maharashtra Rs. 72,00,000 Rs. 72,00,000 Spent directly to
Education K.C.Mahindra Trust

3. Parivaar residential school Kolkata, Rs. 46,80,324 Rs. 46,80,324 Through

expansion project for 100 girl West Bengal implementing
students agency-United Way,
Bengaluru

4. Support an Incubation fund Pan India Rs. 31,85,493 Rs. 31,85,493 Spent directly to
program for Young Innovators Parivaar Education
through a nationwide innovative Society
challenge
2. Community 1. Strengthen community-based Rajathan, Rs. 152 Lakhs Rs. 1,60,00,000 Rs. 1,60,00,000 Through
health care by providing Uttar Pradesh, implementing
enhanced skilling and training to Odisha agency-United Way,
2000 women community health Bengaluru
workers

2. Road Safety Education and Safe Pune, Maharashtra Rs. 14,27,110 Rs. 14,27,110 Through
zone School program implementing
agency-United Way,
Bengaluru
3. Environmental 1. Lake rejuvenation activities for Bengaluru, Rs. 228 Lakhs Rs. 14,27,110 Rs. 14,27,110 Through
Singasandra Kere Lake Karnataka implementing
agency-United Way,
Bengaluru

2. Water Conservation program- Latur, Rs. 80,03,658 Rs. 80,03,658 Through

Jalyukt Shivar Abhiyan in Maharashtra implementing
drought hit villages of Latur agency-United Way,
District (Nilanga Tahsil) Bengaluru
4. Disaster Flood disaster rehabilitation for Ernakulam District, Rs. 86 Lakhs Rs. 30,00,000 Rs. 30,00,000 Through
Rehabilitation affected areas in Kerala and Kodagu Kerala, Kodagu implementing
District, Karnataka agency-United Way,
Bengaluru
5. CSR Management CSR & volunteering Management Rs. 7,81,750 Rs. 7,81,750
Services on Goodera Technology Platform

Total Rs. 770.00 lakhs Rs. 7,70,05,315 Rs. 7,70,05,315

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ANNEXURE ‘F’ TO REPORT OF THE BOARD OF DIRECTORS 3M India Limited

8. Give details of implementing agency:

United Way of Bengaluru: It is a charitable trust registered under the Karnataka Society’s Registration Act, 1960 with its
registered office at 2nd Floor, Esteem Regency, #6, Richmond Road, Bengaluru – 560025, INDIA, and has its office at #811, 1st Floor,
7th Main, 1st Cross, HAL 2nd Stage, Bengaluru – 560008, INDIA. It is guided by its Governing Board members affiliated with United
Way Worldwide, a District of Columbia not for-profit corporation, headquartered at 701 North Fairfax Street, Alexandria, Virginia,
USA 22314-2045.

9. In case the company has failed to spend the two (2) per cent of the average net profit of the last three financial years or any
part thereof, the company shall provide the reasons for not spending the amount in its Board report.
NA
10. A responsibility statement of the CSR committee that the implementation and monitoring of CSR Policy, is in compliance with
CSR objectives and Policy of the Company:
The CSR Committee hereby confirms that the implementation and monitoring of CSR Policy is in compliance with CSR objectives
and policy of the Company.
On behalf of the Board of Directors
Bharat D Shah Debarati Sen B.V. Shankaranarayana Rao
Place : Bengaluru (Chairman CSR Committee) Member Member
Date : May 28, 2019 DIN: 00136969 DIN: 07521172 DIN: 00044840

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 ANNEXURE ‘G’ TO REPORT OF THE BOARD OF DIRECTORS
Information as per Section 197(12) of the Companies Act, 2013, read with the Rule 5(1)(2) & (3) of the Companies (Appointment & Remuneration) Rules, 2014 and forming part of the Report of the Directors for the Year Ended March 31, 2019.

Sl. Age Remuneration Date of Date of

Name Designation Qualifications Particulars of last employment, Name of the employer and post last held
No. Yrs Rs. (Gross) joining leaving
1 2 3 4 5 6 7 8 9
TOP TEN (10) EMPLOYEES IN TERMS OF REMUNERATION DRAWN DURING THE YEAR
BS/BE in Electronics Engineering,
1 Debarati Sen 51 Managing Director 5,29,37,433 1-Jun-16 NA 3M Company, USA, Director, Corporate Sales Operations
MBA (Mktg & Finance)
2 Kris Sridhar 60 Head-Technical 3,79,64,727 Ph.d 1-May-17 NA 3M Company, USA - R & D
3 Mamta Gore 53 Chief Financial officer 3,50,11,652 CA, Retail Management from IIM 1-Mar-18 NA 3M Gulf, Finance Manager
4 Shankaranarayana Rao BV 59 Whole-Time Director 2,16,74,818 B.COM, MBA, ICWA (Inter) 16-Apr-90 NA Mysore Paper Mills limited, Finance Manager
5 Vijay Krishnan V 44 Business Development Manager 1,89,20,316 BE,MBA 2-Aug-04 NA Grindwell Norton Limited, National Sales Manager
6 Sanjit Satapathy 51 Head - Consumer Business 1,52,44,642 B.Sc, PGDM 4-Nov-98 NA Funskool(I) Limited, Area Sales Manager
7 Atul Shukla 51 Head-Safety & Graphics Business 1,51,94,225 BE, Masters in Marketing Management 19-Aug-96 NA Color Chem Limited, Marketing Executive
8 Yogesh Kapur 54 Sr.General Manager-Corporate planning and Strategy 1,37,08,170 BE, Masters in Marketing Management 3-Oct-17 NA 3M Lanka (Private) Ltd, Vice President
9 Jayanand Vasudeorao Kaginalkar 54 Head- Total Supply Chain & Lean Six Sigma 1,32,98,567 BE,PGDM-Operations Management 11-Jul-07 NA TATA CHKK Springs Limited, General Manager Operations
10 Ninad Gadgil 48 Head-Heath Care Business 1,22,65,090 BE,MBA 15-Jun-98 NA The Paper Products Limited, Deputy Manager
EMPLOYEES DRAWING A REMUNERATION OF NOT LESS THAN Rs. 1.02 CRORES AND EMPLOYED THROUGHOUT THE YEAR

114
1 Abhijeet Arun Saungikar 55 Vice President-Technical 1,19,40,625 B.Sc 1-Aug-09 NA Cravatex Limited, Production Supervisor
EMPLOYEES DRAWING A REMUNERATION OF NOT LESS THAN Rs. 8,50,000 PER MONTH AND EMPLOYED FOR PART OF THE YEAR
1 Mukund P T 54 Head-Industrial Business 1,08,85,028 BE (Mech) 18-Sep-89 31-Oct-18 Harita Roloform Private Limited, Marketing Manager
2 Vijay Kumar Ramamoorthy 51 Head-Industrial Business 1,08,50,589 BE (Mech), Masters in Finance 1-Sep-18 NA 3M Electro & Communication India Private Limited, Managing Director
3 Lala Chandrashekher Das 53 Head-Heath Care Business 93,92,968 BE,PGDBM 11-Jan-11 31-Aug-18 Nobel Biocare India Private Limited, Country Manager
4 Jerry Daniel 51 Vice President- Eastern Region 77,54,315 BE, Diploma in Management 15-Jan-13 1-Feb-19 Minda Valeo Security Systems Private Limited, Director-Sales & Marketing
Master of Laws
5 Shobhana Nikam 47 General Counsel 69,06,662 17-Sep-18 NA Fidelity Business Services India private Limited,Vice President & Head Legal
(International & Constitutional Law)
6 Shreya Bhagwanth 43 Head- Human Resources 57,66,513 BA (Economics),Post Graduate Diploma in PM & IR 17-Sep-18 NA Siemens Limited,HR Business Partner – Corporate Function

Notes
1. Remuneration includes salary, bonus, allowances, company’s contribution to superannuation funds, medical reimbursements, leave travel assistance, 3M US Stock option payments, value of other perquisites as per
Income Tax Rules.
2. No one listed above is related to any of the Directors of the Company and all the above appointments are/were on contractual basis.
3. Other terms and conditions are as per rules of the Company and, where required, according to sanctions from the Government.
4. None of the employees holds shares of the Company except Ms. Shreya Bhagwanth, Head- Human Resources, who holds 4 shares.

On behalf of the Board of Directors

Debarati Sen B.V. Shankaranarayana Rao
Place : Bengaluru Managing Director Whole-time Director
3M India Limited

Date : May 28, 2019 DIN: 07521172 DIN: 00044840

ANNEXURE ‘H’ TO REPORT OF THE BOARD OF DIRECTORS 3M India Limited

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
[Section 134(3) (m) of the Companies Act, 2013 read with Rule 8(3) of The Companies (Accounts) Rules, 2014]

CONSERVATION OF ENERGY

Your Company has been very conscious of the need for Conservation of Energy. Energy conservation measures have been implemented
across all locations. Examples of specific energy conservation projects include:

1. Installation of energy efficient variable drive air compressors

2. Regular monitoring and plugging of air leakages

3. Replacement of conventional lamps by LED lamps

4. Optimization of HVAC temperatures

5. Low cost automation to lower the cycle time of operations to improve productivity and reduce specific energy consumption

6. Reduction of idle running of machine through auto sensors.

7. Energy saving by installing harmonics filters in electrical systems.

8. Installation of Variable frequency drives to optimize the speed of the motors and help energy saving.

9. Energy reduction in dust collectors

10. Energy reduction through ware house air-conditioning optimization.

11. Machine improvisation to improve output and reduce specific power consumption

12. Replacement of old reciprocating chillers with new technology screw chillers with improved efficiency

13. Installation of day light panels to reduce day time light energy usage.

TECHNOLOGY ABSORPTION AND RESEARCH & DEVELOPMENT

A. RESEARCH & DEVELOPMENT:

1. Specific areas in which Research & Industrial Business:

Development were carried out by the
 Development of Acoustics solution for Passenger vehicles (Auto OEM
Company.
solution)
 Automotive Aftermarket solution targeted at improving Cabin Air
Quality (Car Air conditioners) in passenger vehicle
 Launch of Fire Barrier solutions for construction market.
Safety and Graphics:
 Launch of Smart Variable messaging signage Systems & comprehensive
solutions to integrate into Smart City Management systems.
 Launch of next generation Road furniture products – Flexible median
marker, ellipsoidal metal delineator & Solar Raised Pavement markers  
to provide increased safety on Indian roads.
 Launch of various models of Eyewears for personal protection systems
for industrial usage.

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ANNEXURE ‘H’ TO REPORT OF THE BOARD OF DIRECTORS 3M India Limited

Health Care Business:

 Products modifications to provide solutions to address unmet needs
for securing the tubes for patients in critical areas of hospital
 Development of Innovative - ready to use sterile dressing to reduce
infection in wounds.
Consumer Business:
 Development of floor care products targeted for cleaner (dusts free)
homes i.e. launch of hard goods -as per requirements of Indian
consumers - as part of Home Care product solution.
2. Benefits derived as a result of the above  New products and applications developed to serve specific needs of
Research & Development the Indian market.
 New technologies developed relevant to Indian market needs to aid
product development.
 Improved system cost solutions for our customers and end users.
 Supporting growth of business through solutions for Indian customers.
3. Future plan of action  Build capabilities in technology and product development to serve the
needs of Indian customers.
 Development of products specific for Indian market, especially in the
areas of Vehicular emissions (target to Bharat Stage VI),Corrosion
Protection, Automotive, Adhesives and Tapes, Abrasive products for
industrial and consumer markets, healthcare products, traffic and
personal safety and graphics.
 Further localization of manufacturing of products to meet Indian
market needs.
4. Expenditure on Research & Development (Rs. in Lakhs)
a) Capital 162.31
b) Revenue 5,265.00
c) Total 5,427.31
d) Total Research & Development
expenditure as a percentage of total
1.93%
turnover.
B. TECHNOLOGY ABSORPTION, ADAPTATION AND INNOVATION
1. Efforts made :
The Company continues to focus on innovating in the local market. The Company’s technical team has been continuously
working on adoption and modification of certain parent company products for local market requirements and redesigning
products to create new market opportunities. The technical team is also focused on developing products that meet the
needs of the Indian customers. Technology development capabilities relevant to local market needs are being developed
in the R&D center to support long term growth. Technology absorption from the parent company continues. Internal
practices and procedures are in place for adoption of new technologies.
2. Benefits derived:
New products have been introduced in several market segments such as: Industrial business, Health Care business, Safety
and graphics business and Consumer business. Several products which were launched used the technical knowledge and
expertise in the India laboratory while leveraging global knowledge base in 3M helped to create intellectual property
protection for the Company. Several local and global patents were filed from technology developed in India. The focus
on local market innovation also led to creation of unique technical skills and laboratory capabilities relevant to the market.

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ANNEXURE ‘H’ TO REPORT OF THE BOARD OF DIRECTORS 3M India Limited

3. Technology imported during the last 5 years:

Technologies and knowhow from parent company include those in the areas of pressure sensitive adhesives and coatings,
corrosion protection coatings, automotive products, retro reflective technology, healthcare products in the area of infection
prevention, and nonwovens for consumer, industrial and safety needs. No technology was imported from other companies
other than from parent company.
The Company had entered into Intellectual Property agreement with 3M Innovative Properties Company and 3M
Company, USA effective July 1, 2006 for the payment of license fees in the form of royalties. Payments were waived off
for a period of 3 years effective from July 1, 2006 to June 30, 2009. These payments have been reinstated with effect from
July 1, 2009, accordingly the Company has incurred an expenditure of Rs. 5,096.23 Lakhs for the financial year 2018-19
(PY: Rs. 3,021.06 Lakhs).

FOREIGN EXCHANGE EARNINGS AND OUTGO

1. Activities relative to exports; initiatives taken to increase exports; development of new export markets for products and
services; export plans:
Continuous focus, strategies, increased sourcing of products and services from 3M India by the 3M Group Companies will increase
export of products and services.
The Company had entered into a contract research agreement with 3M Innovative Properties Company and 3M Company, USA
effective July 1, 2006 for carrying out contract research activities. During the period under review, Company received an amount
of Rs. 2,658.91 Lakhs (PY: Rs. 2,320.80 Lakhs) for contract research and Rs. 982.79 Lakhs (PY: Rs. 683.70 Lakhs) for Support Services
/Corporate Management Fees.

2. Foreign Exchange Earnings and Outgo:

During the period under review, Foreign Exchange Earnings were Rs.10,375.34 Lakhs (PY: Rs. 7,731.61 Lakhs) and Foreign Exchange
Outgo was Rs. 117,774.79 Lakhs (PY: Rs.101,387.86 Lakhs).
On behalf of the Board of Directors
Debarati Sen B.V. Shankaranarayana Rao
Place : Bengaluru Managing Director Whole-time Director
Date : May 28, 2019 DIN: 07521172 DIN: 00044840

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ANNEXURE ‘I’ TO REPORT OF THE BOARD OF DIRECTORS 3M India Limited

SECRETARIAL AUDIT REPORT

Form No. MR-3
SECRETARIAL AUDIT REPORT
FOR THE FINANCIAL YEAR ENDED 31.03.2019
[Pursuant to section 204(1) of the Companies Act, 2013 and rule No.9 of the Companies
(Appointment and Remuneration Personnel) Rules, 2014]
To
The Members,
3M INDIA LIMITED
I have conducted the Secretarial Audit of the compliance of applicable statutory provisions and the adherence to good corporate
practices by 3M India Limited (CIN: L31300KA1987PLC013543) (hereinafter called ‘the Company’). Secretarial Audit was conducted in a
manner that provided me a reasonable basis for evaluating the corporate conducts/statutory compliances and expressing my opinion
thereon.
Based on my verification of the books, papers, minute books, forms and returns filed and other records maintained by the Company
and also the information provided by the Company, its officers, agents and authorized representatives during the conduct of Secretarial
Audit, I hereby report that in my opinion, the Company has, during the audit period covering the financial year ended on 31.03.2019
complied with the statutory provisions listed hereunder and also that the Company has proper Board processes and compliance
mechanism in place to the extent, in the manner and subject to the reporting made hereinafter:
I have examined the books, papers, minute books, forms and returns filed and other records maintained by 3M India Limited for the
financial year ended on 31.03.2019 according to the provisions of:
(i) The Companies Act, 2013 (the Act) and the rules made thereunder;
(ii) The Securities Contracts (Regulation) Act, 1956 (‘SCRA’) and the rules made thereunder;
(iii) The Depositories Act, 1996 and the Regulations and Bye-laws framed thereunder;
(iv) Foreign Exchange Management Act, 1999 and the rules and regulations made thereunder to the extent of Foreign Direct
Investment, Overseas Direct Investment and External Commercial Borrowings;
(v) The following Regulations and Guidelines prescribed under the Securities and Exchange Board of India Act, 1992 (‘SEBI Act’):-
(a) The Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011;
(b) The Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015;
(c) The Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009;
(d) The Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme)
Guidelines, 1999;
(e) The Securities and Exchange Board of India (Issue and Listing of Debt Securities) Regulations, 2008;
(f) The Securities and Exchange Board of India (Registrars to an Issue and Share Transfer Agents) Regulations, 1993 regarding
the Companies Act and dealing with client;
(g) The Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2009; and
(h) The Securities and Exchange Board of India (Buyback of Securities) Regulations, 1998;
(i) The Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015;
(j) The Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014
(k) The Securities and Exchange Board of India (Issue and Listing of Non-Convertible and Redeemable Preference Shares)
Regulations, 2013;
(l) Circulars/Guidelines issued thereunder;
(vi) There are no specific laws applicable to the Company pursuant to the business carried by the Company.
(vii) The other general laws as may be applicable to the Company including the following:

(1) Employer/Employee Related Laws & Rules:

i. Industries (Development & Regulation) Act, 1951
ii. The Factories Act, 1948

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ANNEXURE ‘I’ TO REPORT OF THE BOARD OF DIRECTORS 3M India Limited

iii. The Employment Exchanges (Compulsory notification of Vacancies) Act, 1959

iv. The Apprentices Act, 1961
v. The Employees Provident Fund & Miscellaneous Provisions Act, 1952
vi. The Employees State Insurance Act, 1948
vii. The Workmen’s Compensation Act, 1923
viii. The Maternity Benefits Act, 1961
ix. The Payment of Gratuity Act, 1972
x. The Payment of Bonus Act, 1965
xi. The Industrial Disputes Act, 1947
xii. The Trade Unions Act, 1926
xiii. The Payment of Wages Act, 1936
xiv. The Minimum Wages Act, 1948
xv. The Child Labour (Regulation & Abolition) Act, 1970
xvi. The Contract Labour (Regulation & Abolition) Act, 1970
xvii. The Industrial Employment (Standing Orders) Act, 1946
xviii. Equal Remuneration Act, 1976
xix. Inter-State Migrant Workmen (Regulation of Employment and Conditions of Services) Act, 1979
xx. The Sexual Harassment of Women at Work Place (Prevention, Prohibition & Redressal) Act, 2013
xxi. Persons with Disabilities (Equal Opportunities, Protection of Rights and Full Participation) Act, 1996
xxii. Prohibition of Employment as Manual Scavengers and their Rehabilitation Act, 2013
xxiii. Dangerous Machines (Regulation) Act, 1983
xxiv. Indian Boilers Act, 1923
xxv. The Karnataka Shops & Establishments Act, 1961
xxvi. The Industrial Establishments (National and Festival Holidays) Act, 1963
xxvii. The Labour Welfare Fund Act, 1965
xxviii. The Karnataka Daily Wage Employees Welfare Act, 2012
xxix. The Maharashtra Labour Welfare Fund Act, 1965 & Rules
xxx. The Employment Exchanges (CNV) Act & Rules
xxxi. The Karnataka (National & Festival) Holidays Act & Rules
xxxii. For majority of Central Labour Laws, the State has introduced Rules [names of each of the Rules is not included here]

(2) Environment Related Acts & Rules:

i. The Environment Protection Act, 1986
ii. The Water (Prevention & Control of Pollution) Act, 1974
iii. The Air (Prevention & Control of Pollution) Act, 1981
iv. The Government Order Under Environment (Protection) Act, 1986
v. Hazardous Wastes (Management, Handling and Transboundary Movement) Rules, 2008.
vi. The Karnataka Ground Water (Regulation for Protection of Sources of Drinking Water) Act, 1999

(3) Economic/Commercial Laws & Rules:

i. The Competition Act, 2002
ii. The Indian Contract Act, 1872
iii. The Sales of Goods Act, 1930
iv. The Forward Contracts (Regulation) Act, 1952
v. The Indian Stamp Act, 1899
vi. The Transfer of Property Act, 1882

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ANNEXURE ‘I’ TO REPORT OF THE BOARD OF DIRECTORS 3M India Limited

vii. The Patents Act, 1970

viii. The Trade Marks Act, 1999

(4) Other Laws:

i. Explosives Act
ii. Legal Metrology Act
I have also examined compliances with the applicable clauses of the Secretarial Standards issued by the Institute of Company Secretaries
of India on the Board and General Meetings i.e. SS - 1 and SS – 2.
During the period under review, the Company has complied with the provisions of the Acts, Rules, Regulations, Guidelines, Standards,
etc. mentioned above. Certain non-material findings made during the course of the audit relating to Labour Laws were addressed
suitably by the Management.
Further, I report that with regard to financial and taxation matters, I have relied on the Audit Report, Limited Review Report and the
Internal Audit Report provided by the Statutory/Internal Auditor as the case may be.
I further report that
The Board of Directors of the Company is duly constituted with proper balance of Executive Directors, Non-Executive Directors and
Independent Directors. There were no changes in the composition of the Board of Directors during the period under review.
Adequate notice is given to all Directors to schedule the Board Meetings, agenda and detailed notes on agenda were sent at least seven
days in advance, and a system exists for seeking and obtaining further information and clarifications on the agenda items before the
meeting and for meaningful participation at the Meeting.
The decisions were carried through majority while the dissenting members’ views are captured and recorded as part of the minutes as
per the practice followed. However, during the period under report, there was no such case instance.
I further report that there are adequate systems and processes in the Company commensurate with the size and operations of the
Company to monitor and ensure compliance with applicable laws, rules, regulations and guidelines.
(Vijayakrishna K T)
Place : Bangalore FCS-1788
Date : 28-05-2019 CP-980

Note: This report is to be read with our letter of even date which is annexed as Annexure and forms an integral part of this report.

‘Annexure’
My report of even date is to be read along with this letter:
1. Maintenance of secretarial record is the responsibility of the management of the Company. My responsibility is to express an
opinion on these secretarial records based on our audit.
2. I have followed the audit practices and processes as were appropriate to obtain reasonable assurance about the correctness
of the contents of Secretarial Records. The verification was done on test basis to ensure that correct facts are reflected in the
secretarial records. I believe that the processes and practices, I have followed provide a reasonable basis for our opinion.
3. I have not verified the correctness and appropriateness of financial records and Books of Accounts of the Company including
records under Income Tax Act, Central Excise Act, Customs Act, Central and State Sales Tax Act.
4. Where ever required, the Company has represented about the compliance of laws, rules and regulations and happening of events
etc as applicable from time to time.
5. The compliance of the provisions of Corporate and other applicable laws, rules, regulations, standards is the responsibility of
Management. My examination was limited to the verification of procedures on test basis.
6. The Secretarial Audit report is neither an assurance as to the future viability of the Company nor of the efficacy or effectiveness
with which the Management has conducted the affairs of the Company.
(Vijayakrishna K T)
Place : Bangalore FCS-1788
Date : 28-05-2019 CP-980

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ANNEXURE ‘I-1’ TO REPORT OF THE BOARD OF DIRECTORS 3M India Limited

SECRETARIAL COMPLIANCE REPORT OF 3M INDIA LIMITED

FOR THE YEAR ENDED 31ST MARCH, 2019.
I, Vijayakrishna K T, Practising Company Secretary have examined all the documents and records made available to us and explanation
provided by 3M INDIA LIMITED having CIN: L31300KA1987PLC013543 and having its Registered Office at Plot No. 48-51, Electronic City,
Hosur Road, Bangalore – 560 100 (“the listed entity”), the filings/submissions made by the listed entity to the stock exchanges, website
of the listed entity and other document/filing and as may be relevant, which has been relied upon to make this certification for the
Financial Year ended 31st March, 2019 (“1st April, 2018 to 31st March, 2019”) in respect of compliance with the provisions of :
(a) the Securities and Exchange Board of India Act, 1992 (“SEBI Act”) and the Regulations, circulars, guidelines issued
thereunder; and
(b) the Securities Contracts (Regulation) Act, 1956 (“SCRA”), rules made thereunder and the Regulations, circulars, guidelines
issued thereunder by the Securities and Exchange Board of India (“SEBI”);
The specific Regulations, whose provisions and the Circulars/Guidelines issued thereunder, have been examined, include: -
(a) Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015;
(b) Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2018;
(c) Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011;
(d) Securities and Exchange Board of India (Buyback of Securities) Regulations, 2018;
(e) Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014;
(f) Securities and Exchange Board of India (Issue and Listing of Debt Securities) Regulations, 2008;
(g) Securities and Exchange Board of India (Issue and Listing of Non-Convertible and Redeemable Preference Shares)
Regulations,2013;
(h) Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015;
(i) Circulars/Guidelines issued thereunder;
Based on the above examination, I hereby report that, during the Review Period:
(a) The listed entity has complied with the provisions of the above Regulations and circulars/guidelines issued except in respect of
matters specified below: NIL

Sl. Compliance Requirement (Regulations/circulars/ Observations/Remarks of the

Deviations
No. Guidelines including specific clause Practicing Company Secretary
NOT APPLICABLE
(b) The listed entity has maintained proper records under the provisions of the above Regulations and circulars/guidelines issued
thereunder insofar as it appears from my examination of those records.
(c) The following are the details of actions taken against the listed entity/ its Promoters/Directors/Material Subsidiaries either by SEBI
or by Stock Exchanges (including under the Standard Operating Procedures issued by SEBI through various circulars) under the
aforesaid Acts/Regulations and Circulars/Guidelines issued thereunder:

Details of action taken Observations/Remarks of the

Sl. No. Action taken by Details of violation ex. Fines, warning letter, Practicing Company Secretary,
debarment etc. if any
NIL
(d) The listed entity has taken the following actions to comply with the observations made in previous reports - NA
(Vijayakrishna K T)
Place : Bangalore FCS-1788
Date : 28-05-2019 CP-980

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ANNEXURE ‘J’ TO REPORT OF THE BOARD OF DIRECTORS 3M India Limited

DIVIDEND DISTRIBUTION POLICY

1. Preamble
1.1. 3M India Limited (the Company) has formulated this Dividend Distribution Policy (this Policy) as required by regulation 43A of
the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended (the
Listing Regulations).
1.2. This Policy has been approved by the Board of Directors (Board) of the Company at its meeting held on February 9, 2017. This
Policy may be reviewed by the Board from time to time. This Policy and all amendments thereto will be updated on the Company’s
website (www.3m.com/in) and in the Company’s Annual Report.
2. Policy
2.1. The Board shall consider appropriate financial and other parameters, as well as relevant internal and external factors, when
determining the quantum, if any, of dividend to be paid out by the Company, which may include, but shall not be restricted to, all
or some of the following as the Board in its discretion considers relevant:
(a) Revenues and net profits for the relevant financial year and future outlook;
(b) Possible current and future cash flow requirements;
(c) Liquidity needs including working capital requirements;
(d) Capital expenditure plans and requirements, including for expansion, modernization and upgradation of existing operations
and infrastructure;
(e) Market expansion plans;
(f) Product expansion plans;
(g) Expenditure on research and development;
(h) Possible organic and inorganic growth opportunities, and other usage of cash;
(i) Leverage levels;
(j) Any restrictions and covenants in agreements with debenture-holders, lenders and others;
(k) Comparative tax efficiency of dividend distribution;
(l) Provisions for unforeseen events and contingencies;
(m) Strategic priorities and objectives;
(n) Macroeconomic conditions, local and international; and
(o) Any other methods of delivering value to shareholders.
2.2. When deliberating on the recommendation of dividend, the Board will seek to balance the benefit to shareholders of the
Company with the comparative advantages of retaining profits in the Company which would lead to greater value creation for all
stakeholders.
2.3. In the event that the Board proposes to recommend dividend on the basis of parameters and factors in addition to those stated
in clause 2.1 and 2.2 above, or to change any of the relevant parameters and factors, the changes along with the rationale for the
same shall be disclosed in the Company’s annual report and on the Company’s website (www.3m.com/in).
2.4. Recommendation and declaration of dividend, if any, would be in accordance with the Listing Regulations and the Companies Act,
2013 read with the rules issued thereunder.
2.5. The shareholders of the Company may expect dividend when the Board, on a consideration of such parameters and factors as it
considers relevant, is of the view that it would be in the best interests of the Company and its shareholders as a whole to recommend
dividend, and the shareholders approve such dividend at the Annual General Meeting. The Board may not recommend dividend
where the future outlook, possible future cash flow requirements, growth opportunities, capital expenditure, macroeconomic
conditions or other factors, including as mentioned in clause 2.1 above, in the opinion of the Board, do not warrant recommending
any dividend.
2.6. The Board’s recommendation of dividend would be in the discretion of the Board. Any declaration of dividend pursuant to the
Board’s recommendation would be subject to the approval of the shareholders at the Annual General Meeting as required by the
Companies Act, 2013.
2.7. The Board intends that retained earnings, if any, of the Company shall be used in furtherance of the business objectives and
operations of the Company.
2.8. The Company presently has only one class of shares, being equity shares of face value of INR 10 each.

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ANNEXURE ‘K’ TO REPORT OF THE BOARD OF DIRECTORS 3M India Limited

EXTRACT OF ANNUAL RETURN

As on the financial Year Ended March 31, 2019

[Pursuant to Section 92(3) of the Companies Act, 2013, and Rule 12(1) of the Companies
(Management and Administration) Rules, 2014]

FORM NO. MGT – 9

I. REGISTRATION AND OTHER DETAILS:

1 . CIN: L31300KA1987PLC013543

2 . Registration Date: July 4, 1987

3 . Name of the Company: 3M India Limited

4 . Category / Sub-Category of the Company: Company having Share Capital

5 . Address of the Registered office and contact details:

Plot No. 48-51, Electronics City, Hosur Road, Bengaluru – 560 100, Ph: 080-3914 3000

6 . Whether listed Company: Yes

7 . Name, Address and Contact details of Registrar and Transfer Agent, if any:
Karvy Fintech Private Limited
Karvy Selenium Tower-B,
Plot Nos. 31 & 32, Financial District,
Gachibowli, Nanakramguda,
Serilingampally,
Hyderabad- 500 032
Contact person: Mr. Rajeev Kumar, Ph: 040- 67161524

II. PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY

All the business activities contributing 10 % or more of the total turnover of the Company shall be stated:-

SI. No. Name and Description of NIC Code of the % to Total Turnover
Main Products / Services Product/ Service of the Company
Nil Nil Nil Nil

III. PARTICULARS OF HOLDING, SUBSIDIARY AND ASSOCIATE COMPANIES -

Sl. No. Name and Address CIN/GLN Holding / Subsidiary / % of shares Applicable
of the Company Associate held Section
1 3M Company
3M CENTER, St. PAUL, MN, NA Holding 75% 2(46)
USA-55144-10000
2 3M Electro & U31909PY1989PTC001156 Subsidiary 100% 2(87)
Communication India Private
Limited, Plot no 95 - 97,
Sanniyasikuppam, Thirubhu
Vanai Main Road, Udhaya
Nagar, Sanniyasikuppam,
Thirubhuvanai Post,
Pondicherry - 605107

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ANNEXURE ‘K’ TO REPORT OF THE BOARD OF DIRECTORS 3M India Limited

IV. SHARE HOLDING PATTERN (Equity Share Capital Breakup as percentage of Total Equity)
i) Category-wise Share Holding

No. of shares held at the beginning of the year No. of shares held at the end of the year
(01/04/2018) (31/03/2019) % change
Category of Shareholders during the
% of Total % of Total year
Demat Physical Total Demat Physical Total
Shares Shares
A. Promoters

(1) Indian

(a) Individual/HUF Nil Nil Nil Nil Nil Nil Nil Nil Nil

(b) Central Government Nil Nil Nil Nil Nil Nil Nil Nil Nil

(c) State Government(s) Nil Nil Nil Nil Nil Nil Nil Nil Nil

(d) Bodies Corporate Nil Nil Nil Nil Nil Nil Nil Nil Nil

(e) Banks/FI Nil Nil Nil Nil Nil Nil Nil Nil Nil

(f) Any other. Nil Nil Nil Nil Nil Nil Nil Nil Nil

Sub Total (A)(1) Nil Nil Nil Nil Nil Nil Nil Nil Nil

(2) Foreign

(a) NRI-Individuals Nil Nil Nil Nil Nil Nil Nil Nil Nil

(b) Other-Individuals Nil Nil Nil Nil Nil Nil Nil Nil Nil

(c) Bodies Corporate 84,48,802 Nil 84,48,802 75.00 84,48,802 Nil 84,48,802 75.00 Nil

(d) Banks/FI Nil Nil Nil Nil Nil Nil Nil Nil Nil

(e) Any other. Nil Nil Nil Nil Nil Nil Nil Nil Nil

Sub Total (A)(2) 84,48,802 Nil 84,48,802 75.00 84,48,802 Nil 84,48,802 75.00 Nil

Total Shareholding of Promoters

84,48,802 Nil 84,48,802 75.00 84,48,802 Nil 84,48,802 75.00 Nil
(A)=(A)(1)+(A)(2)

B. Public Shareholding

(1) Institutions

(a) Mutual Funds/UTI 2,28,515 440 2,28,955 2.03 2,45,871 440 2,46,311 2.19 0.16

(b) Banks/FI 1,988 20 2,008 0.02 3,437 20 3,457 0.03 0.01

(c ) Central Government Nil Nil Nil Nil Nil Nil Nil Nil Nil

(d) State Government(s) Nil Nil Nil Nil Nil Nil Nil Nil Nil

(e) Venture Capital Funds Nil Nil Nil Nil Nil Nil Nil Nil Nil

(f) Insurance Companies Nil 60 60 0.00 Nil 60 60 0.00 Nil

(g) FIIs 2,190 Nil 2,190 0.02 183 Nil 183 0.00 (0.02)

(h) Foreign Venture Capital

Nil Nil Nil Nil Nil Nil Nil Nil Nil
Funds

(i) Others(specify)
- Foreign Portfolio Investor 10,30,753 Nil 10,30,753 9.15 9,33,958 Nil 9,33,958 8.29 (0.86)
(Corporate)

Sub-Total (B)(1) 12,63,446 520 12,63,966 11.22 11,83,449 520 11,83,969 10.51 (0.71)

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ANNEXURE ‘K’ TO REPORT OF THE BOARD OF DIRECTORS 3M India Limited

(2) Non-Institutions
(a) Bodies Corporate
i. Indian 3,15,981 1,680 3,17,661 2.82 3,42,520 1,580 3,44,100 3.05 0.23

ii. Overseas Nil Nil Nil Nil Nil Nil Nil Nil Nil

(b) Individuals
i. Individual Shareholders
holding nominal share capital 9,65,666 83,582 10,49,248 9.31 10,06,361 67,969 10,74,330 9.54 0.23
up to Rs. 2 lakh
ii. Individual Shareholders
holding nominal share capital 66,115 Nil 66,115 0.59 65,115 Nil 65,115 0.58 (0.01)
in excess of Rs. 2 lakh
(c) Others (specify) - Alternate
20,488 Nil 20,488 0.18 65,021 Nil 65,021 0.58 0.40
Investment Fund
i. Shares held by Pakistan
citizens vested with the Nil Nil Nil Nil Nil Nil Nil Nil Nil
Custodian of enemy property
ii. Other Foreign Nationals Nil Nil Nil Nil Nil Nil Nil Nil Nil
iii. Foreign Bodies Nil Nil Nil Nil Nil Nil Nil Nil Nil
iv. NRI/OCBs 57,570 Nil 57,570 0.51 61,183 Nil 61,183 0.55 0.04

v. Clearing Members/Clearing
840 Nil 840 0.01 533 Nil 533 0.00 (0.01)
House
vi. Trusts 372 Nil 372 0.00 422 Nil 422 0.00 Nil

vii. Limited Liability Partnerships Nil Nil Nil Nil Nil Nil Nil Nil Nil
viii. Foreign Portfolio Investor
Nil Nil Nil Nil Nil Nil Nil Nil Nil
(Corporate)
ix. Qualified Foreign Investor Nil Nil Nil Nil Nil Nil Nil Nil Nil
x. NBFCs Registered with RBI 40,008 Nil 40,008 0.36 21,595 Nil 21,595 0.19 (0.17)

Sub Total (B)(2) 14,67,040 85,262 15,52,302 13.78 15,62,750 69,549 16,32,299 14.49 0.71

Total Public Shareholding

27,30,486 85,782 28,16,268 25.00 27,46,199 70,069 28,16,268 25.00 Nil
(B)=(B)(1)+(B)(2)
C. Shares held by Custodian for
Nil Nil Nil Nil Nil Nil Nil Nil Nil
GDRs & ADRs
GRAND TOTAL(A+B+C) 1,11,79,288 85,782 1,12,65,070 100.00 1,11,95,001 70,069 1,12,65,070 100.00 Nil

(ii) Shareholding of Promoters

Shareholding at the beginning of the year Shareholding at the end of the year
(01/04/2018) (31/03/2019)
% change in
Shareholders % of Shares % of Shares shareholding
Name %of total %of total
No. of Pledged / Pledged / during the year
shares of the No. of shares shares of the
shares Company
encumbered to
Company
encumbered to
total shares total shares

3M Company, USA 84,48,802 75% Nil 84,48,802 75% Nil Nil

Total 84,48,802 75% Nil 84,48,802 75% Nil Nil

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ANNEXURE ‘K’ TO REPORT OF THE BOARD OF DIRECTORS 3M India Limited

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

Shareholding at the beginning of Cumulative Shareholding during

the year (01/04/2018) the year (31/03/2019)
SI. No.
No. of % of total shares No. of % of total shares
shares of the Company shares of the Company
At the beginning of the year No Change
Date wise Increase / Decrease in Promoters
Shareholding during the year specifying the
No Change
reasons for increase / decrease (e.g. allotment /
transfer / bonus/ sweat equity etc.,)
At the end of the year No Change

(iv) Shareholding Pattern of top ten Shareholders (other than Directors, Promoters and Holders of GDRs and ADRs):

Shareholding at the Shareholding at the

beginning of the year Increase Decrease end of the year
(01/04/2018) during the during the (31/03/2019)
Sl.
For each of the Top 10 Shareholders % of total year (+) year (-) Date % of total
No.
No. of shares (market (market No. of shares
shares of the purchase) sale) shares of the
Company Company
1. Acacia Partners, LP 3,26,032 2.89 Nil 3,032 06/04/2018 2,10,000 1.86
4,200 13/04/2018
2,600 20/04/2018
13,600 04/05/2018
1,000 18/05/2018
637 25/05/2018
173 01/06/2018
6,000 10/08/2018
20,590 17/08/2018
12,100 24/08/2018
5,100 31/08/2018
7,100 07/09/2018
4,000 14/09/2018
21,900 14/12/2018
4,900 01/03/2019
9,100 08/03/2019
2. Acacia Institutional Partners, LP 2,43,100 2.16 Nil 8,315 14/12/2018 1,85,016 1.64
2,000 08/03/2019
15,785 15/03/2019
27,200 22/03/2019
4,784 29/03/2019
3. Acacia Conservation Fund, LP 2,06,400 1.83 Nil Nil Nil 2,06,400 1.83

4. Bright Star Investments Private Limited 1,66,700 1.48 Nil Nil Nil 1,66,700 1.48

5. SBI Equity Hybrid Fund 1,00,000 0.89 30,000 Nil 14/12/2018 1,30,000 1.15

6. Acacia Banyan Partners 1,26,045 1.12 Nil Nil Nil 1,26,045 1.12

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ANNEXURE ‘K’ TO REPORT OF THE BOARD OF DIRECTORS 3M India Limited

7. IDFC Multi Cap Fund 1,04,808 0.93 5,504 20/07/2018 95,099 0.84
1,427 27/07/2018
402 10/08/2018
400 17/08/2018
50 30/11/2018
25 14/1`2/2018
257 28/12/2018
100 27/02/2019
400 01/03/2019
808 15/03/2019
2,000 22/03/2019
8. Govindlal M Parikh 41,115 0.36 Nil 710 07/09/2018 41,115 0.36
290 14/09/2018
9. Nemish S Shah 25,000 0.22 Nil Nil Nil 25,000 0.22
10. IIFL Focussed Equity Strategies Fund 14,700 0.13 761 Nil 15/06/2018 24,329 0.22
160 22/06/2018
4,999 29/06/2018
524 20/07/2018
3,185 19/10/2018

(v) Shareholding of Directors and Key Managerial Personnel:

Shareholding at the beginning of Cumulative Shareholding during
Sl. the year (01/04/2018) the year (31/03/2019)
No. For Each of the Directors and KMP No. of % of total shares No. of % of total shares
shares of the Company shares of the Company
At the beginning of the year • Directors and KMPs -Nil
Date wise Increase / Decrease in Increase in shareholding details
Shareholding during the year specifying • Directors and KMPs -Nil
the reasons for increase / decrease
(e.g. allotment / transfer / bonus/ sweat Decrease in shareholding details
equity etc): • Directors and KMPs -Nil
At the End of the year • Directors and KMPs -Nill

V. INDEBTEDNESS
Indebtedness of the Company including interest outstanding/accrued but not due for payment
Secured Loans Unsecured Deposits Total
excluding deposits Loans Indebtedness
(Rs.) (Rs.) (Rs.) (Rs.)
Indebtedness at the beginning of the financial year
i) Principal Amount Nil Nil Nil Nil
ii) Interest due but not paid Nil Nil Nil Nil
iii) Interest accrued but not due Nil Nil Nil Nil
Total (i+ii+iii) Nil Nil Nil Nil
Change in Indebtedness during the financial year
• Addition Nil Nil Nil Nil
• Deletion Nil Nil Nil Nil
Net Change Nil Nil Nil Nil
Indebtedness at the end of the financial year
i) Principal Amount Nil Nil Nil Nil
ii) Interest due but not paid Nil Nil Nil Nil
iii) Interest accrued but not due Nil Nil Nil Nil
Total (i+ii+iii) Nil Nil Nil Nil

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ANNEXURE ‘K’ TO REPORT OF THE BOARD OF DIRECTORS 3M India Limited

VI. REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNEL

A. Remuneration to Managing Director (MD), Whole-time Directors (WTD) and/or Manager:

SI. Managing Director Whole-time Director Total Amount

Particulars of Remuneration
no. (Rs.) (Rs.) (Rs.)
1. Gross salary
(a) Salary as per provisions contained
in Section 17(1) of the Income-tax
Act, 1961 2,11,19,459 1,77,43,724 3,88,63,183
(b) Value of perquisites u/s 17(2) Income-
tax Act, 1961 3,18,17,974 Nil 3,18,17,974
Nil
(c) Profits in lieu of salary under
Section 17(3) Income-tax Act, 1961 Nil Nil
2. Stock Option Nil Nil Nil
3. Sweat Equity Nil Nil Nil
4. Commission
- As a % of profit Nil Nil Nil
- Others, specify
5. Others, Please specify
- Restricted Stock Units(RSU’s) and Stock
Appreciation Rights(SARs) of the Parent
Company Nil 39,31,094 39,31,094
- Contribution to Provident Fund 38,32,572 7,68,744 46,01,316
TOTAL (A) (Rs.) 5,67,70,005 2,24,43,562 7,92,13,567
Ceiling as per the Act(Section 197) The remuneration payable to an individual Managing Director or Whole-
time Director shall not exceed 5% of the Net Profits and if there is more than
one such Director, remuneration shall not exceed 10% of the net profit to
all such Directors taken together. The remuneration paid is well within the
prescribed limits. The limit as per the Act is Rs. 49.75 crores.

B. Remuneration to other Directors:

Name of the Directors Total

Particulars of
Amount
Remuneration Mr. Bharat D Shah Mr. Biren Gabhawala Ms. Radhika Rajan (Rs.)

Independent Directors

Fee for attending Board /

3,60,000 3,20,000 2,60,000 9,40,000
Committee meetings

Commission for the year

FY 2015-16 (to be paid in 15,00,000 15,00,000 15,00,000 45,00,000
the FY 2016-17)

Others, please specify Nil Nil Nil Nil

Total (1) (Rs.) 18,60,000 18,20,000 17,60,000 54,40,000

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ANNEXURE ‘K’ TO REPORT OF THE BOARD OF DIRECTORS 3M India Limited

Name of the Directors

Total
Particulars of Ms. Sadhana
Mr. Albert C Amount
Remuneration Mr. Amit Mr. Ramesh Mr. Jongho Kaul (from
Wang (up to (Rs.)
Laroya Ramadurai Lee October 31,
August 21, 2018)
2018)

Other Non-Executive Directors

Fee for attending Board /

Nil Nil Nil Nil Nil Nil
Committee meetings
Commission for the year
FY 2018-19(to be paid in Nil Nil Nil Nil Nil Nil
the FY 2019-20)
Others, please specify Nil Nil Nil Nil Nil Nil
Total (2) Nil Nil Nil Nil Nil Nil
Total (B) = (1+2) (Rs.) 54,40,000
Ceiling as per the Act (Section 197) The remuneration payable to all Non-Executive Directors and Independent
Directors shall not exceed 1% of the Net Profits of the Company. The
remuneration paid is well within the prescribed limits. The limit as per the Act
is Rs.4.97crores.
Overall ceiling as per the Act (Section 197) The total managerial remuneration payable to its Directors, including Managing
Director and Whole-time Director and its Manager in respect of any financial
year shall not exceed 11% of the Net Profits of the Company. The remuneration
paid is well within the overall limits. The limit as per the Act is Rs. 54.72 crores.

C. REMUNERATION TO KEY MANAGERIAL PERSONNEL OTHER THAN MD/MANAGER/WTD

SI. Chief Financial Officer Company Secretary

Particulars of Remuneration
No. Rs. Rs.

Gross Salary
1. (a) Salary as per provisions contained in section 17(1) of the Income-
tax Act, 1961 1,79,25,010 44,20,140
(b) Value of perquisites u/s 17(2) Income-tax Act, 1961 1,70,86,642 Nil
(c) Profits in lieu of salary under section 17(3) Income-tax Act, 1961 Nil Nil

2. Stock Option Nil Nil

3. Sweat Equity Nil Nil

4. Commission
- as % of profit Nil Nil
- others, specify Nil Nil

5. Others, please specify-

- Restricted Stock Units (RSU’s) and Stock Appreciation
Rights(SARs) of the Parent Company Nil Nil
- Contribution to Provident Fund 14,50,170 1,97,208

Total (C) 3,64,61,822 46,17,348

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ANNEXURE ‘K’ TO REPORT OF THE BOARD OF DIRECTORS 3M India Limited

VII. PENALTIES / PUNISHMENT/ COMPOUNDING OF OFFENCES:

Details of Penalty
Section of the / Punishment / Authority Appeal made, if
Type Brief Description
Companies Act Compounding fees [RD/NCLT/ COURT] any (give Details)
imposed
A. COMPANY
Penalty
Punishment None
Compounding
B. DIRECTORS
Penalty
Punishment None
Compounding
C. OTHER OFFICERS IN DEFAULT
Penalty
Punishment None
Compounding

On behalf of the Board of Directors

Debarati Sen B.V. Shankaranarayana Rao
Place : Bengaluru Managing Director Whole-time Director
Date : May 28, 2019 DIN: 07521172 DIN: 00044840

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ANNEXURE ‘L’ TO REPORT OF THE BOARD OF DIRECTORS 3M India Limited

Details of Subsidiaries, Associates and Joint Ventures

Form AOC 1
(Pursuant to the provisions of Section 129(3) of the Act, read with Rule 5 of Companies (Accounts) Rules, 2014.

Statement containing as on March 31, 2019 salient features of the financial statement of subsidiaries/associate companies/Joint
ventures

PART A: Subsidiaries
Rs. in Lakhs
Closing Average Share Reserves and Total Total
Name of the Subsidiary Financial year ended Currency
exchange rate exchange rate Capital Surplus Assets Liabilities
3M Electro & Communication
March 31, 2019 INR 1 - 50.00 15,750.54 21,052.51 5,251.97
India Private Limited*

Rs. in Lakhs
Investments Turnover Profit/(loss) Provision for Profit/(loss) Proposed % of share Country
before taxation taxation after taxation dividend holding
Nil 20,913.04 3,007.96 992.54 4,325.31 Nil 100 India
Note: * became a subsidiary with effect from December 27, 2018

Part B: Associates and Joint Ventures

Nil
On behalf of the Board of Directors
Debarati Sen B.V. Shankaranarayana Rao
Place : Bengaluru Managing Director Whole-time Director
Date : May 28, 2019 DIN: 07521172 DIN: 00044840

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INDEPENDENT AUDITORS’ REPORT 3M India Limited

INDEPENDENT AUDITORS’ REPORT

To the Members of 3M India Limited

Report on the Audit of the Standalone Financial Statements

Opinion
We have audited the standalone financial statements of 3M India Limited (“the Company”), which comprise the standalone balance
sheet as at 31 March 2019, and the standalone statement of profit and loss (including other comprehensive income), standalone
statement of changes in equity and standalone statement of cash flows for the year then ended, and notes to the standalone financial
statements, including a summary of the significant accounting policies and other explanatory information.

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial
statements give the information required by the Companies Act, 2013 (“Act”) in the manner so required and give a true and fair view in
conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at 31 March 2019, and
profit and other comprehensive income, changes in equity and cash flows for the year ended on that date.

Basis for Opinion

We conducted our audit in accordance with the Standards on Auditing (SAs) specified under section 143(10) of the Act. Our responsibilities
under those SAs are further described in the Auditor’s Responsibilities for the Audit of the Standalone Financial Statements section of
our report. We are independent of the Company in accordance with the Code of Ethics issued by the Institute of Chartered Accountants
of India together with the ethical requirements that are relevant to our audit of the standalone financial statements under the provisions
of the Act and the Rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and
the Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the standalone financial
statements of the current year. These matters were addressed in the context of our audit of the standalone financial statements as a
whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

Description of Key Audit Matter

Investment in 3M Electro & Communication India Private Limited

See note 3(d) and 6 to the standalone financial statements

The key audit matter How the matter was addressed in our audit
• During the year, the Company acquired 100% stake in 3M Our audit procedures included:
Electro & Communication India Private Limited from its
• Assessment of the controls to identify and disclose related
existing shareholders (related parties of the Company) at a
party relationships and transactions in accordance with the
consideration of INR 58,470 lakhs.
relevant accounting standards.
• We identified the above investment transaction as a key audit
• Assessment of compliance with the regulations under the
matter given it involved compliance with various regulations
Companies Act, 2013 and the listing regulations with respect
and fair valuation of the acquiree.
to the investment.
• Evaluating the work of the external expert for fair valuation of
the acquired entity, reasonableness of the methodology and
the underlying assumptions used in the valuation.
• Evaluating the accounting and disclosures of the investment
in a subsidiary in compliance with the accounting standards.

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INDEPENDENT AUDITORS’ REPORT 3M India Limited

Revenue Recognition

See note 3 (h) and 20 to the standalone financial statements

The key audit matter How the matter was addressed in our audit
• The Company recognises revenue when control is transferred Our audit procedures included:
to the customer i.e. on delivery to customer. The Company • Assessing the appropriateness of the revenue recognition
tracks proof of delivery and reverses the value of goods not accounting policies in compliance with the accounting
delivered by the balance sheet date. standards.
• We identified revenues recognised closer to the balance • Tested the design and operating effectiveness of relevant key
sheet date as a key audit matter given it is a significant key controls with respect to revenue recognition on a sample
performance indicator and there is a risk of overstatement of basis.
revenues at the balance sheet date.
• We performed substantive testing by selecting samples (using
statistical sampling) of revenue transactions, recorded during
the year by testing the underlying documents.
• Analytical procedures on revenue recognised during the year
to identify and inquire on unusual variances, if any.
• Independent confirmation on a sample basis of customer
invoice balances at the balance sheet date using statistical
sampling.
• Obtaining supporting documentation, on a sample basis for
sales transactions recorded near to balance sheet date as well
as credit notes issued subsequent to the balance sheet date
to determine whether revenue was recognised in the correct
period.
• Tested, on a sample basis using statistical sampling, manual
journal entries relating to revenues to identify and inquire on
unusual items, if any.

Other Information
The Company’s Management and Board of Directors are responsible for the other information. The other information comprises the
information included in the Company’s annual report, but does not include the financial statements and our auditors’ report thereon.
Our opinion on the standalone financial statements does not cover the other information and we do not express any form of assurance
conclusion thereon.
In connection with our audit of the standalone financial statements, our responsibility is to read the other information and, in doing so,
consider whether the other information is materially inconsistent with the standalone financial statements or our knowledge obtained
in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a
material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Management’s Responsibility for the Standalone Financial Statements

The Company’s Management and Board of Directors are responsible for the matters stated in section 134(5) of the Act with respect
to the preparation of these standalone financial statements that give a true and fair view of the state of affairs, profit/loss and other
comprehensive income, changes in equity and cash flows of the Company in accordance with the accounting principles generally
accepted in India, including the Indian Accounting Standards (Ind AS) specified under section 133 of the Act. This responsibility also
includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the
Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies;
making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal
financial controls that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to
the preparation and presentation of the standalone financial statements that give a true and fair view and are free from material
misstatement, whether due to fraud or error.
In preparing the standalone financial statements, management and Board of Directors are responsible for assessing the Company’s
ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of

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INDEPENDENT AUDITORS’ REPORT 3M India Limited

accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to
do so.
Board of Directors is also responsible for overseeing the Company’s financial reporting process.

Auditor’s Responsibilities for the Audit of the Standalone financial statements

Our objectives are to obtain reasonable assurance about whether the standalone financial statements as a whole are free from material
misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high
level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement
when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could
reasonably be expected to influence the economic decisions of users taken on the basis of these standalone financial statements.
As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the
audit. We also:
• Identify and assess the risks of material misstatement of the standalone financial statements, whether due to fraud or error, design
and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a
basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from
error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the
circumstances. Under section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the company has
adequate internal financial controls with reference to financial statements in place and the operating effectiveness of such controls.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures
made by management.
• Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence
obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company’s
ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our
auditors’ report to the related disclosures in the standalone financial statements or, if such disclosures are inadequate, to modify
our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future
events or conditions may cause the Company to cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the standalone financial statements, including the disclosures, and
whether the standalone financial statements represent the underlying transactions and events in a manner that achieves fair
presentation.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and
significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding
independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our
independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in the
audit of the standalone financial statements of the current period and are therefore the key audit matters. We describe these matters in
our auditors’ report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we
determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably
be expected to outweigh the public interest benefits of such communication.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditors’ Report) Order, 2016 (“the Order”) issued by the Central Government in terms of section
143 (11) of the Act, we give in the “Annexure A” a statement on the matters specified in paragraphs 3 and 4 of the Order, to the
extent applicable.
(A) As required by Section 143(3) of the Act, we report that:
a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were
necessary for the purposes of our audit.
b) In our opinion, proper books of account as required by law have been kept by the Company so far as it appears from our
examination of those books.

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INDEPENDENT AUDITORS’ REPORT 3M India Limited

c) The standalone balance sheet, the standalone statement of profit and loss (including other comprehensive income), the
standalone statement of changes in equity and the standalone statement of cash flows dealt with by this Report are in
agreement with the books of account.
d) In our opinion, the aforesaid standalone financial statements comply with the Ind AS specified under section 133 of the Act.
e) On the basis of the written representations received from the directors as on 31 March 2019 taken on record by the Board
of Directors, none of the directors is disqualified as on 31 March 2019 from being appointed as a director in terms of Section
164(2) of the Act.
f) With respect to the adequacy of the internal financial controls with reference to financial statements of the Company and
the operating effectiveness of such controls, refer to our separate Report in “Annexure B”.
(B) With respect to the other matters to be included in the Auditors’ Report in accordance with Rule 11 of the Companies (Audit and
Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:
i. The Company has disclosed the impact of pending litigations as at 31 March 2019 on its financial position in its standalone
financial statements - Refer Note 36 to the standalone financial statements;
ii. The Company did not have any long term contracts including derivative contracts for which there were any material
foreseeable losses ;
iii. There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the
Company;
iv. The disclosures in the standalone financial statements regarding holdings as well as dealings in specified bank notes during
the period from 8 November 2016 to 30 December 2016 have not been made in these financial statements since they do
not pertain to the financial year ended 31 March 2019.
(C) With respect to the matter to be included in the Auditors’ Report under section 197(16):
In our opinion and according to the information and explanations given to us, the remuneration paid by the company to its
directors during the current year is in accordance with the provisions of Section 197 of the Act. The remuneration paid to any
director is not in excess of the limit laid down under Section 197 of the Act. The Ministry of Corporate Affairs has not prescribed
other details under Section 197(16) which are required to be commented upon by us.
For B S R & Co. LLP
Chartered Accountants
Firm Registration No: 101248W/W-100022
Amit Somani
Place : Paris Partner
Date : May 28, 2019 Membership Number: 060154

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ANNEXURE ‘A’ TO INDEPENDENT AUDITORS’ REPORT 3M India Limited

ANNEXURE – A TO THE INDEPENDENT AUDITORS’ REPORT

With reference to the Annexure A referred to in paragraph 1 in Report on Other Legal and Regulatory Requirements of the Independent
Auditors’ Report to the Members of the Company on the Standalone financial statements for the year ended 31 March 2019, we report
that:
(i) (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed
assets.
(b) The Company has a regular programme of physical verification of its fixed assets by which all fixed assets are physically
verified in a phased manner over a period of three years.In our opinion, the periodicity of physical verification is reasonable
having regard to the size of the Company and the nature of its assets. Pursuant to the programme, certain fixed assets have
been physically verified during the year and no material discrepancies were noticed on such verification.
(c) In our opinion and according to the information and explanations given to us and on the basis of our examination of the
records of the Company, the title deeds of immovable properties included in property, plant and equipment are held in the
name of the Company.
In respect of immovable properties been taken on lease and disclosed as property, plant and equipment in the standalone
financial statements, the lease agreements are in the name of the Company. Also refer explanatory note (a) of Note (4) to
the Standalone financial statements.
(ii) The inventory, except goods-in-transit and stocks lying with third parties has been physically verified by the Management during
the year. In our opinion, the frequency of such physical verification is reasonable. The discrepancies noticed on physical verification
between the physical stock and the book records were not material and have been appropriately dealt with in the books of
accounts. For stocks lying with third parties at the year end, written confirmations have been obtained by the Management.
(iii) According to the information and explanations given to us, the Company has not granted any loans, secured or unsecured, to
companies, firms, limited liability partnerships or other parties covered in the register maintained under Section 189 of the Act.
Accordingly, the provisions of clause 3(iii) (a), (b) and (c) of the Order are not applicable to the Company.
(iv) In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of
section 186 of the Act in respect of investments made. Further, there are no loans, guarantees and security given in respect of
which provisions of Sections 185 and 186 of the Act are applicable.
(v) According to the information and explanations given to us, the Company has not accepted any deposits from the public in
accordance with the provisions of Sections 73 to 76 or any other relevant provisions of the Act and the rules framed there under.
Accordingly, the provisions of clause 3(v) of the Order are not applicable to the Company.
(vi) We have broadly reviewed the books of account maintained by the Company pursuant to the rules prescribed by the Central
Government of India for maintenance of cost records under section 148(1) of the Act in respect of products manufactured and
are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. However, we have not
made a detailed examination of the records.
(vii) (a) According to the information and explanations given to us and on the basis of our examination of the records of the
Company, amounts deducted/ accrued in the books of account in respect of undisputed statutory dues including Provident
fund, Employees State Insurance, Income-tax, Duty of customs, Goods and Services tax, Cess and any other material
statutory dues have generally been regularly deposited during the year by the Company with the appropriate authorities.
As explained to us, the Company did not have any dues on account of Sales-tax, Service-tax, Duty of excise and Value added
tax during the year. Also refer note 36 to the financial statements.
According to the information and explanations given to us, no undisputed amounts payable in respect of Provident fund,
Employees State Insurance, Income-tax, Duty of customs, Goods and Services tax, Cess and any other material statutory
dues were in arrears as at 31 March 2019 for a period of more than six months from the date they became payable.
(b) According to the information and explanations given to us, the particulars of dues of Income-tax, Sales-tax, Service-tax,
Duty of customs, Duty of excise and Value added tax as at 31 March 2019 which have not been deposited by the Company
on account of disputes are mentioned in Appendix-1.
(viii) In our opinion and according to the information and explanations given to us, the Company did not have any loans or borrowings
from financial institutions or banks or government and there were no dues to debenture holders during the year.

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ANNEXURE ‘A’ TO INDEPENDENT AUDITORS’ REPORT 3M India Limited

(ix) The Company did not raise any money by way of initial public offer or further public offer (including debt instrument) and term
loans during the year. Accordingly, para 3(ix) of the Order is not applicable to the Company.
(x) According to the information and explanations given to us, no material fraud on the Company by its officers and employees or
fraud by the Company has been noticed or reported during the course of our audit.
(xi) According to the information and explanations given to us and based on examination of the records of the Company, the Company
has paid/ provided for managerial remuneration in accordance with the requisite approvals mandated by the provisions of Section
197 read with Schedule V to the Act.
(xii) According to the information and explanations given to us, in our opinion the Company is not a Nidhi Company as prescribed
under Section 406 of the Act. Accordingly, para 3(xii) of the Order is not applicable to the Company.
(xiii) According to the information and explanations given to us and based on our examination of the records of the Company, all
transactions with the related parties are in compliance with Section 177 and 188 of the Act, where applicable, and details of all
transactions have been disclosed in the Standalone financial statements as required by the applicable accounting standards.
(xiv) According to the information and explanations given to us and based on our examination of the records of the Company, the
Company has not made any preferential allotment or private placement of shares or issued fully or partly convertible debentures
during the year. Accordingly, para 3(xiv) of the Order is not applicable to the Company.
(xv) According to the information and explanations given to us and based on our examination of the records of the Company, the
Company has not entered into non-cash transactions with directors or persons connected with him/ her. Accordingly, para 3(xv)
of the Order is not applicable to the Company.
(xvi) According to the information and explanations given to us and in our opinion the Company is not required to be registered under
section 45-IA of the Reserve Bank of India Act, 1934.
For B S R & Co. LLP
Chartered Accountants
Firm Registration No: 101248W/W-100022
Amit Somani
Place : Paris Partner
Date : May 28, 2019 Membership Number: 060154

Appendix 1 to the Annexure A to the Independent Auditor’s Report

Demand Payment Net Period to

Statute / Forum where the
amount under amount which it
Nature of dues dispute is pending
(Rs. in lakhs) protest (Rs. in lakhs) pertains
13,140.09 1,965.31 11,174.78 2010-2016 Commissioner of Income Tax (Appeals)
Income tax
2,062.56 561.79 1,500.77 2006-2013 Income Tax appellate tribunal

Sales tax/ 11,675.84 1,522.13 10,153.70 2004-2015 Appellate Authority up to Commissioner’s level
Value added tax /
Central Sales tax 2,813.59 1,451.49 1,362.10 2006-2013 Sales Tax appellate tribunal

Excise (including 193.23 - 193.23 2010-2017 Commissioner- Appeals

service tax) 1,956.61 117.26 1,839.35 2006-2015 Customs, Excise and service tax appellate tribunal

1,961.51 - 1,961.51 2005-2010 Customs, Excise and service tax appellate tribunal
Custom duty
16,387.03 577.01 15,810.02 2011-2014 Directorate of Revenue Intelligence

137
ANNEXURE ‘B’ TO INDEPENDENT AUDITORS’ REPORT 3M India Limited

Annexure B to the Independent Auditors’ report on the standalone financial statements of

3M India Limited for the year ended 31 March 2019
Report on the internal financial controls with reference to the aforesaid standalone financial statements under Clause (i) of
Sub-section 3 of Section 143 of the Companies Act, 2013
(Referred to in paragraph 1 (A)(f) under ‘Report on Other Legal and Regulatory Requirements’ section of our report of even date)

Opinion
We have audited the internal financial controls with reference to standalone financial statements of 3M India Limited (“the Company”)
as of 31 March 2019 in conjunction with our audit of the standalone financial statements of the Company for the year ended on that
date.
In our opinion, the Company has, in all material respects, adequate internal financial controls with reference to standalone financial
statements and such internal financial controls were operating effectively as at 31 March 2019, based on the internal financial controls
with reference to financial statements criteria established by the Company considering the essential components of internal control
stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered
Accountants of India (the “Guidance Note”).

Management’s Responsibility for Internal Financial Controls

The Company’s management and the Board of Directors are responsible for establishing and maintaining internal financial controls
based on the internal financial controls with reference to financial statements criteria established by the Company considering the
essential components of internal control stated in the Guidance Note. These responsibilities include the design, implementation and
maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its
business, including adherence to company’s policies, the safeguarding of its assets, the prevention and detection of frauds and errors,
the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required
under the Companies Act, 2013 (hereinafter referred to as “the Act”).

Auditors’ Responsibility
Our responsibility is to express an opinion on the Company’s internal financial controls with reference to standalone financial statements
based on our audit. We conducted our audit in accordance with the Guidance Note and the Standards on Auditing, prescribed under
section 143(10) of the Act, to the extent applicable to an audit of internal financial controls with reference to standalone financial
statements. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit
to obtain reasonable assurance about whether adequate internal financial controls with reference to standalone financial statements
were established and maintained and whether such controls operated effectively in all material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls with reference
to financial statements and their operating effectiveness. Our audit of internal financial controls with reference to financial statements
included obtaining an understanding of such internal financial controls, assessing the risk that a material weakness exists, and testing
and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend
on the auditor’s judgement, including the assessment of the risks of material misstatement of the standalone financial statements,
whether due to fraud or error.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the
Company’s internal financial controls with reference to standalone financial statements.

Meaning of Internal Financial controls with Reference to Financial Statements

A company’s internal financial controls with reference to financial statements is a process designed to provide reasonable assurance
regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with
generally accepted accounting principles. A company’s internal financial controls with reference to financial statements include
those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect
the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as
necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts
and expenditures of the company are being made only in accordance with authorisations of management and directors of the company;
and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the
company’s assets that could have a material effect on the financial statements.

138
ANNEXURE ‘B’ TO INDEPENDENT AUDITORS’ REPORT 3M India Limited

Inherent Limitations of Internal Financial controls with Reference to Financial Statements

Because of the inherent limitations of internal financial controls with reference to financial statements, including the possibility of
collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected.
Also, projections of any evaluation of the internal financial controls with reference to financial statements to future periods are subject
to the risk that the internal financial controls with reference to financial statements may become inadequate because of changes in
conditions, or that the degree of compliance with the policies or procedures may deteriorate.
For B S R & Co. LLP
Chartered Accountants
Firm Registration No: 101248W/W-100022
Amit Somani
Place : Paris Partner
Date : May 28, 2019 Membership Number: 060154

139
STANDALONE BALANCE SHEET 3M India Limited

(Rs. in lakhs)
As at Note 31 March 2019 31 March 2018
I. Assets
(1) Non-current assets
(a) Property, plant and equipment 4 26,927.06 28,491.27
(b) Capital work-in-progress 4 1,019.45 575.17
(c) Intangible assets 5 20.95 31.17
(d) Financial assets
(i) Investments 6 58,470.00 -
(ii) Loans receivable 8 939.81 1,204.26
(e) Deferred tax assets, (net) 37 2,347.42 1,134.80
(f) Income tax assets, (net) 37 5,519.96 4,330.16
(g) Other non-current assets 10 5,127.82 3,581.09
Total non-current assets 100,372.47 39,347.92
(2) Current assets
(a) Inventories 11 37,918.19 34,728.93
(b) Financial assets
(i) Trade receivables 7 54,613.88 52,963.65
(ii) Cash and cash equivalents 12 47,039.04 78,931.24
(iii) Loans receivable 8 458.24 195.99
(iv) Other financial assets 9 3,023.48 4,114.09
(c) Other current assets 10 5,943.02 3,253.43
Total current assets 148,995.85 174,187.33
Total assets 249,368.32 213,535.25
II. Equity and liabilities
Equity
(a) Equity share capital 13 1,126.51 1,126.51
(b) Other equity 14 184,826.52 152,540.21
Total equity 185,953.03 153,666.72
Liabilities
(1) Non-current liabilities
(a) Financial liabilities
- Borrowings 15 745.44 487.74
(b) Provisions 16 2,645.21 2,167.35
Total non-current liabilities 3,390.65 2,655.09
(2) Current liabilities
(a) Financial liabilities
(i) Trade payables
- Total outstanding dues of micro and small enterprises 17 1,825.38 1,241.18
- Total outstanding dues of creditors other than micro and small enterprises 17 30,509.76 30,838.77
(ii) Other financial liabilities 18 15,167.72 14,579.10
(b) Other current liabilities 19 4,085.12 2,465.35
(c) Provisions 16 6,648.73 6,220.72
(d) Income tax liabilities, (net) 37 1,787.93 1,868.32
Total current liabilities 60,024.64 57,213.44
Total liabilities 63,415.29 59,868.53
Total equity and liabilities 249,368.32 213,535.25
Significant accounting policies 3

See accompanying notes to the standalone financial statements

As per our report of even date attached
For B S R & Co. LLP For and on behalf of the Board of Directors
Chartered Accountants
Firm registration number: 101248W/W-100022 Debarati Sen B V Shankaranarayana Rao
Amit Somani Managing Director Whole-time Director
Partner [DIN: 07521172] [DIN – 00044840]
Membership No: 060154 Mamta Gore V. Srinivasan
Place: Paris Place: Bangalore Chief Financial Officer Company Secretary
Date: May 28, 2019 Date: May 28, 2019 [PAN: AKIPG9089M] [ACS – 16430]

140
STANDALONE STATEMENT OF PROFIT AND LOSS 3M India Limited

(Rs. in lakhs)
For the year ended Note 31 March 2019 31 March 2018
Income
Revenue from operations 20 280,875.97 258,039.60
Other income 21 3,283.16 4,361.54
Total income 284,159.13 262,401.14
Expenses
Cost of materials consumed 22 86,741.34 81,163.29
Excise duty - 2,425.88
Purchases of stock-in-trade 23 63,315.23 53,970.94
Changes in inventories of finished goods, stock-in-trade and work-in-progress 24 (1,387.67) (1,999.10)
Employee benefits expense 25 30,106.15 32,407.88
Finance costs 26 109.18 194.07
Depreciation and amortisation expense 4, 5 4,187.67 4,180.32
Other expenses 27 51,341.30 42,089.56
Total expenses 234,413.20 214,432.84
Profit before tax 49,745.93 47,968.30
Tax expense :
(i) Current tax 37 18,652.61 17,256.13
(ii) Deferred tax 37 (1,205.76) (341.39)
17,446.85 16,914.74
Profit for the year 32,299.08 31,053.56
Other comprehensive income
Items that will not be reclassified subsequently to the statement of profit or loss
Remeasurements of net defined benefit (liability) / asset (19.63) (40.13)
Income tax relating to items that will not be reclassified subsequently to profit or loss 6.86 13.88
Other comprehensive income, net of tax (12.77) (26.25)
Total comprehensive income for the year 32,286.31 31,027.31
Earnings per share (Nominal value of Rs. 10 each) 29
- Basic (in Rs.) 286.72 275.66
- Diluted (in Rs.) 286.72 275.66
Weighted average number of equity shares used in computing earnings per share :
- Basic 1,12,65,070 1,12,65,070
- Diluted 1,12,65,070 1,12,65,070
Significant accounting policies 3

See accompanying notes to the standalone financial statements

As per our report of even date attached
For B S R & Co. LLP For and on behalf of the Board of Directors
Chartered Accountants
Firm registration number: 101248W/W-100022 Debarati Sen B V Shankaranarayana Rao
Amit Somani Managing Director Whole-time Director
Partner [DIN: 07521172] [DIN – 00044840]
Membership No: 060154 Mamta Gore V. Srinivasan
Place: Paris Place: Bangalore Chief Financial Officer Company Secretary
Date: May 28, 2019 Date: May 28, 2019 [PAN: AKIPG9089M] [ACS – 16430]

141
STANDALONE STATEMENT OF CHANGE IN EQUITY 3M India Limited

(Rs. in lakhs)

Other equity
Total equity
Other comprehensive
Surplus attributable
Equity income Total
to equity
Particulars share Remeasurement of Other
holders
capital Securities General Retained the net defined Equity
of the
premium Reserve earnings benefit liability / asset, Company
net of tax
Balance as at 1 April 2017 1,126.51 949.90 32.25 120,834.57 (303.82) 121,512.90 122,639.41
Changes in equity for the year ended
31 March 2018
Remeasurement of the net defined
benefit liability / asset, net of tax - - - - (26.25) (26.25) (26.25)
effect
Profit for the year - - - 31,053.56 - 31,053.56 31,053.56
Balance as at 31 March 2018 1,126.51 949.90 32.25 151,888.13 (330.07) 152,540.21 153,666.72

Other equity
Total equity
Other comprehensive
Surplus attributable
Equity income Total
to equity
Particulars share Remeasurement of Other
holders
capital Securities General Retained the net defined Equity
of the
premium Reserve earnings benefit liability / asset, Company
net of tax
Balance as at 1 April 2018 1,126.51 949.90 32.25 151,888.13 (330.07) 152,540.21 153,666.72
Changes in equity for the year ended
31 March 2019
Remeasurement of the net defined
benefit liability / asset, net of tax - - - - (12.77) (12.77) (12.77)
effect
Profit for the year - - - 32,299.08 - 32,299.08 32,299.08
Balance as at 31 March 2019 1,126.51 949.90 32.25 184,187.21 (342.84) 184,826.52 185,953.03

See accompanying notes to the standalone financial statements

As per our report of even date attached
For B S R & Co. LLP For and on behalf of the Board of Directors
Chartered Accountants
Firm registration number: 101248W/W-100022 Debarati Sen B V Shankaranarayana Rao
Managing Director Whole-time Director
Amit Somani [DIN: 07521172] [DIN – 00044840]
Partner
Membership No: 060154 Mamta Gore V. Srinivasan
Place: Paris Place: Bangalore Chief Financial Officer Company Secretary
Date: May 28, 2019 Date: May 28, 2019 [PAN: AKIPG9089M] [ACS – 16430]

142
STANDALONE STATEMENT OF CASH FLOW 3M India Limited

(Rs. in lakhs)

For the year ended 31 March 2019 31 March 2018

Cash flow from operating activities

Profit before tax 49,745.93 47,968.30

Adjustments for:

Depreciation and amortisation expense 4,187.67 4,180.32

Provision for doubtful debts created 1,027.17 744.99

Liabilities no longer required written back, net (597.95) (534.39)

Unrealised net gain on foreign currency transactions and translation (390.27) (7.29)

Loss on disposal of property, plant and equipment 1.40 8.91

Interest income (2,685.21) (3,585.56)

Finance costs 109.18 194.07

51,397.92 48,969.35

Movements in working capital

Increase / (decrease) in trade payables 1,016.81 (7,362.13)

Increase in provisions 876.81 424.02

Increase / (decrease) in other financial liabilities and other liabilities 2,322.93 (1,795.30)

Increase in trade receivables (2,687.15) (12,916.98)

Increase in inventories (3,189.26) (1,551.13)

Increase in loans, other financial assets, other current and non current assets (3,083.71) (3,391.90)

Cash generated from operations activities 46,654.35 22,375.93

Income tax paid (net of refund) (19,922.80) (19,433.93)

Net cash from operating activities (A) 26,731.55 2,942.00

Cash flow from investing activities

Purchase of property, plant and equipment and intangible assets (3,824.18) (1,576.09)

Proceeds from sale of property, plant and equipment 25.29 113.36

Investment in subsidiary (58,470.00) -

Interest received 3,286.18 3,262.18

Net cash / (used in) from investing activities (B) (58,982.71) 1,799.45

Cash flow from financing activities

Movement in finance lease liability 403.40 (32.03)

Interest paid (44.44) (194.08)

Net cash from / (used in) financing activities (C) 358.96 (226.11)

143
STANDALONE STATEMENT OF CASH FLOW 3M India Limited

(Rs. in lakhs)

For the year ended 31 March 2019 31 March 2018

Net (decrease)/ increase in cash and cash equivalents (A+B+C) (31,892.20) 4,515.34

Cash and cash equivalents at the beginning of the year 78,931.24 74,415.90

Cash and cash equivalents at the end of the year 47,039.04 78,931.24

Cash and cash equivalents comprise of (refer note 12):

Balances with banks:

- in current accounts 47,039.04 18,931.24

- deposits accounts (original maturity of less than three months) - 60,000.00

47,039.04 78,931.24

Debt reconciliation statement in accordance with Ind AS 7

Non Current borrowings and current maturities of long term borrowings

Opening balance 946.17 978.20

Movement in finance lease liability 403.40 (32.03)

Closing balance 1,349.57 946.17

Significant accounting policies (Refer Note 3)

See accompanying notes to the standalone financial statements

As per our report of even date attached
For B S R & Co. LLP For and on behalf of the Board of Directors
Chartered Accountants
Firm registration number: 101248W/W-100022 Debarati Sen B V Shankaranarayana Rao
Managing Director Whole-time Director
Amit Somani [DIN: 07521172] [DIN – 00044840]
Partner
Membership No: 060154 Mamta Gore V. Srinivasan
Place: Paris Place: Bangalore Chief Financial Officer Company Secretary
Date: May 28, 2019 Date: May 28, 2019 [PAN: AKIPG9089M] [ACS – 16430]

144
NOTES TO THE STANDALONE FINANCIAL STATEMENTS 3M India Limited

1. Reporting entity
3M India Limited (‘the Company’) is a subsidiary of 3M Company, USA. The Company manages its operations in five operating
segments: Industrial, Health Care, Safety and Graphics, Consumer and Energy. In India, the Company has manufacturing facilities
at Ahmedabad, Bangalore, Pune and has a R&D Center in Bangalore. 3M India’s five business segments bring together common
or related 3M technologies that enhance the development of innovative products and services and provide efficient sharing of
business resources. The Company is a public limited Company domiciled in India with its registered office situated at Plot Nos. 48-
51, Electronic City, Hosur Road, Bengaluru - 560 100 and is listed on the Bombay Stock Exchange Ltd (BSE) and the National Stock
Exchange Ltd (NSE).

2. Basis of preparation
A. Statement of compliance
These financial statements of the Company have been prepared in accordance with Indian Accounting Standards (Ind AS) as
per the Companies (Indian Accounting Standards) Rules, 2015, as amended notified under Section 133 of Companies Act,
2013, (the ‘Act’) and other relevant provisions of the Act.
The financial statements were authorised for issue by the Company’s Board of Directors on 28 May 2019.
Details of the Company’s significant accounting policies are included in Note 3.
B. Functional & presentation currency
These financial statements are presented in Indian Rupees (Rs.), which is also the Company’s functional currency. All
amounts have been rounded-off to two decimal places to the nearest lakhs, unless otherwise indicated.
C. Basis of measurement
The financial statements have been prepared on the historical cost basis except for the following items:
Items Measurement basis
Certain financial assets and liabilities Fair value
Liabilities for cash settled shared-based payment arrangements Fair value
Net defined benefit asset / (liability) Fair value of plan assets less present value of
defined benefit obligations

D. Use of estimates and judgments

In preparing these financial statements, management has made judgments, estimates and assumptions that affect the
application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may
differ from these estimates.
Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised
prospectively.
Judgments
Information about judgments made in applying accounting policies that have the most significant effects on the amounts
recognised in the financial statements is included in the following notes:
- Note 28 - leases: whether an arrangement contains a lease; and
- Note 28 - lease classification;
Assumptions and estimation uncertainties
Information about assumptions and estimation uncertainties that have a significant risk of resulting in a material adjustment
in the year ending 31 March 2020 is included in the following notes:
- Note 4 and 5 - useful life of property, plant and equipment and intangible assets;
- Note 7 to 9 and 40 - impairment of financial assets;
- Note 32 - measurement of defined benefit obligations: key actuarial assumptions;

145
NOTES TO THE STANDALONE FINANCIAL STATEMENTS 3M India Limited

- Note 36 - recognition and measurement of provisions and contingencies: key assumptions about the likelihood and
magnitude of an outflow of resources; and
- Note 37 - recognition of deferred tax assets: availability of future taxable profit against which tax losses carried forward
can be used.
E. Measurement of fair values
Certain accounting policies and disclosures of the Company require the measurement of fair values, for both financial and
non financial assets and liabilities.
The Company has an established control framework with respect to the measurement of fair values.
Fair values are categorised into different levels in a fair value hierarchy based on the inputs used in the valuation techniques
as follows:
- Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities
- Level 2: inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly
(i.e. as prices) or indirectly (i.e. derived from prices)
- Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs)
When measuring the fair value of an asset or a liability, the Company uses observable market data as far as possible. If the
inputs used to measure the fair value of an asset or a liability fall into a different levels of the fair value hierarchy, then the
fair value measurement is categorised in its entirety in the same level of the fair value hierarchy as the lowest level input
that is significant to the entire measurement.
Further information about the assumptions made in the measuring fair values is included in the following notes:
- Note 31 - share-based payment arrangements and
- Note 40 - financial instruments

3. Significant accounting policies

(a) Financial instruments
i. Recognition and initial measurement
The Company initially recognises financial assets and financial liabilities when it becomes a party to the contractual
provisions of the instrument. All financial assets and liabilities are measured at fair value on initial recognition which
are initially measured at transaction price. Transaction costs that are directly attributable to the acquisition or issue of
financial assets and financial liabilities, that are not at fair value through profit or loss, are added to the fair value on
initial recognition. Regular way purchase and sale of financial assets are accounted for at trade date.
ii. Classification and subsequent measurement
Financial assets
On initial recognition, a financial asset is classified as measured at-
Financial assets carried at amortised cost
A financial asset is subsequently measured at amortised cost if it is held within a business model whose objective is
to hold the asset in order to collect contractual cash flows and the contractual terms of the financial asset give rise on
specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.
Financial assets at fair value through other comprehensive income
A financial asset is subsequently measured at fair value through other comprehensive income if it is held within a
business model whose objective is achieved by both collecting contractual cash flows and selling financial assets and
the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of
principal and interest on the principal amount outstanding.
Financial assets at fair value through profit or loss
A financial asset which is not classified in any of the above categories are subsequently fair valued through profit or
loss.

146
NOTES TO THE STANDALONE FINANCIAL STATEMENTS 3M India Limited

Financial liabilities
Financial liabilities are subsequently carried at amortized cost using the effective interest method, except for
contingent consideration recognized in a business combination which is subsequently measured at fair value through
profit and loss. For trade and other payables maturing within one year from the Balance Sheet date, the carrying
amounts approximate fair value due to the short maturity of these instruments.
iii. Derecognition of financial instruments
Financial assets
The Company derecognises a financial asset when the contractual rights to the cash flows from the financial asset
expire, or it transfers the right to receive the contractual cash flows in a transaction in which substantially all of the risks
and rewards of ownership of the financial assets are transferred or in which the Company neither transfers nor retains
substantially all of the risks and rewards of ownership and does not retain control of the financial asset.
Financial liabilities
The Company derecognises a financial liability when its contractual obligations are discharged or cancelled, or expire.
The Company also derecognises a financial liability when its terms are modified and the cash flows under the modified
terms are substantially different. In this case, a new financial liability based on the modified terms is recognised at fair
value. The difference between the carrying amount of the financial liability extinguished and a new financial liability
with modified terms is recognised in the statement of profit and loss.
iv. Offsetting
Financial assets and financial liabilities are offset and the net amount presented in the balance sheet when, and only
when, the Company currently has a legally enforceable right to set off the amounts and it intends either to settle them
on a net basis or realise the asset and settle the liability simultaneously.
(b) Property, plant and equipment
i. Recognition and measurement
Items of property, plant and equipment, are measured at cost, which includes capitalised borrowing cost, less
accumulated depreciation and accumulated impairment losses, if any.
Cost of an item of property, plant and equipment comprises its purchase price, including import duties and non-
refundable purchase taxes, after deducting trade discounts and rebates, any directly attributable cost of bringing the
item to its working condition for its intended use and estimated costs of dismantling and removing the item and
restoring the site on which it is located.
If significant parts of an item of property, plant and equipment have different useful lives, then they are accounted for
as separate items (major components) of property, plant and equipment.
Any gain or loss on disposal of an item of property, plant and equipment is recognised in the statement of profit or loss.
ii. Subsequent expenditure
Subsequent expenditure is capitalised only if it is probable that the future economic benefits associated with the
expenditure will flow to the Company.
iii. Depreciation
Depreciation is calculated on cost of items of property, plant and equipment less their estimated residual values over
their estimated useful lives using the straight-line method, and is recognised in the statement of profit and loss.
Leasehold improvements are amortised over the period of lease or the estimated useful life (3-10 years) whichever is
lower. Assets acquired under finance leases are depreciated over the shorter of the lease term and their useful lives
unless it is reasonably certain that the Company will obtain ownership by the end of the lease term. Freehold land is
not depreciated.

147
NOTES TO THE STANDALONE FINANCIAL STATEMENTS 3M India Limited

The estimated useful lives of items of property, plant and equipment for the current and comparative periods are as
follows:

Asset Useful lives

Buildings 10/ 20 and 30 years
Plant and machinery 3/ 7/ 10 and 15 years
Data processing equipment 3 years
Office equipment 5 years
Furniture and fixtures 10 years
Vehicles 5 years
Depreciation/amortisation method, useful lives and residual values are reviewed at each financial year-end and
adjusted if appropriate. Based on technical evaluation and consequent advice, the management believes that the
estimates of useful lives as given above best represent the period over which management expects to use these assets
and are different from the useful lives as prescribed under Part C of Schedule II of the Companies Act, 2013 for some
assets.
Depreciation on additions (disposals) is provided on a pro-rata basis i.e. from (upto) the date on which asset is ready
for use (disposed of).
(c) Intangible assets
Internally generated : Research and development
Expenditure on research activities is recognised in statement of profit or loss as incurred.
Development expenditure is capitalised as part of the cost of the resulting intangible asset only if the expenditure can be
measured reliably, the product or process is technically and commercially feasible, future economic benefits are probable,
and the Company intends to and has sufficient resources to complete development and to use or sell the asset. Otherwise,
it is recognised in statement of profit or loss as incurred. Subsequent to initial recognition, the asset is measured at cost less
accumulated amortisation and any accumulated impairment losses.
Others
Other intangible assets are stated at acquisition cost. Such intangible assets are subsequently measured at cost less
accumulated amortisation and any accumulated impairment losses.
Amortisation is calculated to write off the cost of intangible assets less their estimated residual values over their estimated
useful lives using the straight-line method, and is included in depreciation and amortisation in statement of profit and loss.
The amortisation rates used are:
Asset Useful life
Computer software 3 years
(d) Investment in subsidiaries
Investment in equity shares in subsidiaries is carried at cost less impairment if any, in the financial statements.
(e) Impairment
(i) Financial assets
The Company recognizes loss allowances using the expected credit loss (ECL) model for the financial assets which are
not fair valued through profit or loss. Loss allowance for trade receivables with no significant financing component is
measured at an amount equal to lifetime ECL. For all other financial assets, expected credit losses are measured at an
amount equal to the 12-month ECL, unless there has been a significant increase in credit risk from initial recognition
in which case those are measured at lifetime ECL. The amount of expected credit losses (or reversal) that is required
to adjust the loss allowance at the reporting date to the amount that is required to be recognised is recognised as an
impairment gain or loss in the statement of profit or loss.

148
NOTES TO THE STANDALONE FINANCIAL STATEMENTS 3M India Limited

(ii) Non -financial assets

Intangible assets and property, plant and equipment
Intangible assets and property, plant and equipment are evaluated for recoverability whenever events or changes in
circumstances indicate that their carrying amounts may not be recoverable. For the purpose of impairment testing,
the recoverable amount (i.e. the higher of the fair value less cost to sell and the value-in-use) is determined on an
individual asset basis unless the asset does not generate cash flows that are largely independent of those from other
assets. In such cases, the recoverable amount is determined for the Cash generating units (CGUs) to which the asset
belongs.
If such assets are considered to be impaired, the impairment to be recognized in the Statement of Profit and Loss is
measured by the amount by which the carrying value of the assets exceeds the estimated recoverable amount of the
asset. An impairment loss is reversed in the statement of profit and loss if there has been a change in the estimates
used to determine the recoverable amount. The carrying amount of the asset is increased to its revised recoverable
amount, provided that this amount does not exceed the carrying amount that would have been determined (net of
any accumulated amortization or depreciation) had no impairment loss been recognized for the asset in prior years.
(f) Inventories
Inventories are valued at the lower of cost and estimated net realizable value, after providing for cost of obsolescence and
other anticipated losses, wherever considered necessary. The costs of raw materials and traded goods are ascertained on
First-In-First-Out basis, whereas manufactured work-in-progress and finished goods are ascertained on weighted average
method.
Finished goods and work-in-progress include costs of conversion and other costs incurred in bringing the inventories to their
present location and condition. Net realisable value is the estimated selling price in the ordinary course of business, less the
estimated costs of completion and the estimated costs necessary to make the sale.
The comparison of cost and net realisable value is made on an item-by-item basis.
The provision for inventory obsolescence is ascertained regularly based on estimated usage of the products.
(g) Foreign currency transactions
Transactions in foreign currencies are initially recorded by the Company at their functional currency spot rates at the date
of the transaction. Monetary assets and liabilities denominated in foreign currency are translated at the functional currency
spot rates of exchange at the balance sheet date. Exchange differences that arise on settlement of monetary items or on
reporting at each balance sheet date of the Company’s monetary items at the closing rates are recognised as income or
expenses in the period in which they arise. Non-monetary items which are carried at historical cost denominated in a
foreign currency are reported using the exchange rates at the date of transaction. Non-monetary items measured at fair
value in a foreign currency are translated using the exchange rates at the date when the fair value is determined.
(h) Revenue recognition
Effective April 1, 2018, the Company has applied Ind AS 115: Revenue from Contracts with Customers which establishes a
comprehensive framework for determining whether, how much and when revenue is to be recognised. Ind AS 115 replaces
Ind AS 18 Revenue. The Company has adopted Ind AS 115 using the cumulative effect method (without the practical
expedient), with the effect of initially applying this standard recognised at the date of initial application (i.e. 1 April 2018).
The adoption of the standard did not have any material impact on the financial statements of the Company.
Revenue from sale of goods is recognised when control of the products being sold is transferred to the customer and when
there are no longer any unfulfilled obligations.
The Performance Obligations in the contracts are fulfilled at the time of dispatch, delivery or upon formal customer
acceptance depending on customer terms.
Revenue is measured at fair value of the consideration received or receivable, after deduction of any trade discounts, volume
rebates and any taxes or duties collected on behalf of the government such as goods and services tax, etc. Accumulated
experience is used to estimate the provision for such discounts and rebates. Revenue is only recognised to the extent that
it is highly probable a significant reversal will not occur.
Customers have the contractual right to return goods. An estimate is made of goods that will be returned and a liability is
recognised for this amount using a best estimate based on accumulated experience.

149
NOTES TO THE STANDALONE FINANCIAL STATEMENTS 3M India Limited

Income from services rendered is recognised based on agreements/arrangements with the customers as the service is
performed and there are no unfulfilled obligations.
Contract assets are recognised when there is excess of revenue earned over billings on contracts. Contract assets are
classified as unbilled receivables (only act of invoicing is pending) when there is unconditional right to receive cash, and
only passage of time is required, as per contractual terms. Other contract assets are classified as other assets. Unearned
and deferred revenue (“contract liability”) is recognised when there is billings in excess of revenues. Advances received for
goods and services are reported as liabilities until all conditions for revenue recognition are met.
The Company has determined that the revenues as disclosed in Note 20 are disaggregated into categories that depict how
the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors.
Interest income is recognized using the effective interest rate (EIR) method.
Dividend income on investments is recognised when the right to receive dividend is established.
(i) Employee benefits
Defined contribution plans
A defined contribution plan is a post-employment benefit plan under which an entity pays fixed contributions into a
separate entity and will have no legal or constructive obligation to pay further amounts. Obligations for contributions to
defined contribution plans are recognised as an employee benefit expense in the statement of profit or loss in the periods
during which the related services are rendered by employees.
Provident fund
Contribution towards provident fund for certain employees is made to the regulatory authorities, where the Company has
no further obligations. Such benefits are classified as Defined Contribution Schemes as the Company does not carry any
further obligations, apart from the contributions made on a monthly basis.
Superannuation
The Company makes contribution to the Superannuation Scheme for certain employees participating in the scheme, a
defined contribution scheme, administered by fund manager, based on a specified percentage of eligible employees’ salary.
The Company’s obligation to the scheme is restricted to the contributions to the scheme.
Defined benefit plans
Gratuity
The Company has an obligation towards gratuity, a defined benefit retirement plan covering eligible employees. The
Company has an Employees Gratuity Fund where the investments are administered by a Fund Manager. The Company
accounts for the liability of Gratuity Benefits payable in future based on an independent actuarial valuation (using the
Projected Unit Credit method). Actuarial losses/ gains are recognised in ‘Other Comprehensive Income’ in the year in which
they arise.
Compensated absences
The Company provides for the encashment/ availment of leave with pay subject to certain rules. The employees are
entitled to accumulate leave subject to certain limits, for future encashment/ availment. The liability is provided based on
the number of days of unutilized leave at each balance sheet date on the basis of an independent actuarial valuation (using
the Projected Unit Credit method). Actuarial losses / gains are recognised in ‘Other Comprehensive Income’ in the year in
which they arise.
(j) Share-based payments
The fair value of the amount payable to employees in respect of share appreciation rights (SARs) and restricted stock units
(RSUs) which are settled in cash, is recognised as an expense with a corresponding increase in liabilities, over the period that
the employees unconditionally become entitled to the payment. The Company measures compensation expense for SARs
at their fair value determined using Black-Scholes Model and RSUs based on fair market value of shares of 3M Company,
USA on the date of the grant. Any change in the fair value of the liability are recognised in the Statement of profit and loss.

150
NOTES TO THE STANDALONE FINANCIAL STATEMENTS 3M India Limited

(k) Income taxes

i. Current tax
Current income tax for the current and prior periods are measured at the amount expected to be recovered from or
paid to the taxation authorities based on the taxable income for the period. The tax rates and tax laws used to compute
the current tax amount are those that are enacted or substantively enacted by the reporting date and applicable for
the period. The Company offsets current tax assets and current tax liabilities, where it has a legally enforceable right to
set off the recognized amounts and where it intends either to settle on a net basis or to realize the asset and liability
simultaneously.
ii. Deferred tax
Deferred income tax is recognized using the balance sheet approach. Deferred income tax assets and liabilities are
recognized for deductible and taxable temporary differences arising between the tax base of assets and liabilities and
their carrying amount in financial statements, except when the deferred income tax arises from the initial recognition
of goodwill or an asset or liability in a transaction that is not a business combination and affects neither accounting nor
taxable profits or loss at the time of the transaction.
Deferred income tax asset are recognized to the extent that it is probable that taxable profit will be available against
which the deductible temporary differences, and the carry forward of unused tax credits and unused tax losses can be
utilized. Deferred income tax liabilities are recognized for all taxable temporary differences.
The carrying amount of deferred income tax assets is reviewed at each reporting date and reduced to the extent that it
is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred income tax asset
to be utilized.
Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply in the period when
the asset is realized or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively
enacted at the reporting date.
The Company offsets, the current tax assets and liabilities (on a year on year basis) and deferred tax assets and
liabilities, where it has a legally enforceable right and where it intends to settle such assets and liabilities on a net basis.
(l) Borrowing costs
Borrowing costs attributable to the assets acquired on finance lease are expensed in the period in which they incur in the
statement of profit and loss.
(m) Provisions and contingent liabilities
i. General
Provisions are recognised when the Company has a present obligation (legal or constructive) as a result of a past event,
it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a
reliable estimate can be made of the amount of the obligation. When the Company expects some or all of a provision
to be reimbursed. The expense relating to a provision is presented in the statement of profit and loss net of any
reimbursement.
If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects,
when appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due to the
passage of time is recognised as a finance cost.
ii. Contingent liabilities
A disclosure for contingent liabilities is made where there is a possible obligation or a present obligation that may
probably not require an outflow of resources. When there is a possible or a present obligation where the likelihood of
outflow of resources is remote, no provision or disclosure is made.
iii. Onerous contracts
Provision for onerous contracts. i.e. contracts where the expected unavoidable cost of meeting the obligations under
the contract exceed the economic benefits expected to be received under it, are recognised when it is probable that
an outflow of resources embodying economic benefits will be required to settle a present obligation as a result of an
obligating event based on a reliable estimate of such obligation.

151
NOTES TO THE STANDALONE FINANCIAL STATEMENTS 3M India Limited

(n) Leases
i. Finance leases
The Company leases certain tangible assets and such leases where the Company has substantially all the risks and
rewards of ownership are classified as finance leases. Finance leases are capitalised at the inception of the lease at the
lower of the fair value of the leased asset and the present value of the minimum lease payments.
The leased assets are measured initially at an amount equal to the lower of their fair value and the present value
of minimum lease payments. Subsequent to initial recognition, the assets are accounted in accordance with the
accounting policy applicable to similar owned assets.
Each lease payment is apportioned between the finance charge and the reduction of the outstanding liability. The
outstanding liability is included in long-term borrowings and other current liabilities as appropriate. The finance
charge is charged to the Statement of Profit and Loss over the lease period so as to produce a constant periodic rate
of interest on the remaining balance of the liability for each period.
ii. Operating leases
Leases in which a significant portion of the risks and rewards of ownership are retained by the lessor are classified as
operating leases. Payments made under operating leases are generally recognised in profit or loss on a straight-line
basis over the term of the lease unless such payments are structured to increase in line with expected general inflation
to compensate for the lessor’s expected inflationary cost increases.
(o) Segment reporting
Operating segments
The Company publishes the unconsolidated financial statements of the Company along with the consolidated financial
statements. In accordance with Ind AS 108, Operating Segments, the Company has disclosed the segment information in
the consolidated financial statements.
(p) Cash and cash equivalents
Cash and cash equivalents includes cash on hand, demand deposits with banks, other short-term highly liquid investments
with original maturities of three months or less.
(q) Earnings per share
Basic Earnings Per Share (‘EPS’) is computed by dividing the net profit attributable to the equity shareholders by the
weighted average number of equity shares outstanding during the year.
For the purpose of calculating diluted earnings per share, the net profit/ loss for the period attributable to the equity
shareholders and the weighted average number of shares outstanding during the period is adjusted for the effects of all
dilutive potential equity shares.
(r) Cash flow statement
Cash flows are reported using indirect method, whereby net profits before tax is adjusted for the effects of transactions of
a non-cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from regular
revenue generating (operating activities), investing and financing activities of the Company are segregated.
(s) Recent Indian Accounting Standards :
i. Ind AS 116 - Leases
The Company is required to adopt IND AS 116 Leases from 1 April 2019. IND AS 116 replaces existing leases guidance,
including IND AS 17 Leases. IND AS 116 introduces a single Balance sheet lease accounting model for lessees. A lessee
recognises a right of use asset representing its right to use the underlying asset and a lease liability representing its
obligation to make lease payments. There are recognition exemptions for short term leases and leases of low value
items.
Leases in which the Company is a lessee:
Under the new standard, the Company will be required to recognise new assets and liabilities for its operating leases.
The nature of expenses related to those leases will now change because the Company will recognise a depreciation
charge for right of use assets and interest expense on lease liabilities. Previously, the Company recognised operating

152
NOTES TO THE STANDALONE FINANCIAL STATEMENTS 3M India Limited

lease expense over the term of the lease, and recognised assets and liabilities only to the extent that there was a timing
difference between actual lease payments and the expense recognised. The Company is in the process of evaluating
the potential impact of the adoption of Ind AS 116 on accounting policies followed in its financial statements. The
quantitative impact of adoption of Ind AS 116 on the financial statements in the period of initial application is not
reasonably estimable as at present.
Transition
The Company plans to apply IND AS 116 using the modified retrospective method, with the effect of initially applying
this standard recognised at the date of initial application (i.e. 1 April 2019) in retained earnings. As a result, the
Company will not present individual line items appearing under comparative period presentation.
ii. Ind AS 19 – Plan Amendment, Curtailment or Settlement
The amendment clarifies that when determining past service cost, or a gain or loss on settlement due to plan
amendment, curtailment or settlement, an entity shall remeasure the net defined benefit liability (asset) using the
current fair value of plan assets and current actuarial assumptions, including current market interest rates and other
current market prices, reflecting:
(a) the benefits offered under the plan and the plan assets before the plan amendment, curtailment or settlement;
and
(b) the benefits offered under the plan and the plan assets after the plan amendment, curtailment or settlement.
Further, if a plan amendment, curtailment or settlement occurs, it is mandatory that the current service cost and the net
interest for the period after the re-measurement are determined using the assumptions used for the re-measurement. In
addition, amendments have been included to clarify the effect of a plan amendment, curtailment or settlement on the
requirements regarding the asset ceiling. The Company does not expect any significant impact of this amendment on its
financial statements.

153
 4 Property, plant and equipment and capital work-in-progress (Rs. in lakhs)
Leased Assets
Data Leasehold
Freehold Plant and Furniture & Office Leasehold Data Leasehold
Particulars Buildings processing Vehicles improve- Total
land machinery fixtures equipment land processing improve- Vehicles
equipment ments
Note (a) equipment ments
Balance at 31 March 2017 227.95 15,219.38 20,153.07 1,296.22 694.14 58.26 2.87 606.03 387.17 1,262.24 31.84 708.30 40,647.47
Additions - - 633.98 13.07 58.07 - - - - 435.79 - 158.61 1,299.52
Disposals - (0.06) (90.36) (0.15) (2.59) - - - - (472.06) (31.84) (256.32) (853.38)
Balance at 31 March 2018 227.95 15,219.32 20,696.69 1,309.14 749.62 58.26 2.87 606.03 387.17 1,225.97 - 610.59 41,093.61
Additions - 24.20 1,260.66 211.19 67.70 - - - - 959.18 - 100.20 2,623.13
Disposals - - (83.56) (29.55) (12.05) - - (8.90) - (279.87) - (156.91) (570.84)
Balance at 31 March 2019 227.95 15,243.52 21,873.79 1,490.78 805.27 58.26 2.87 597.13 387.17 1,905.28 - 553.88 43,145.90
Accumulated depreciation
Balance at 31 March 2017 - 1,273.85 5,236.03 404.81 540.18 58.26 2.41 567.76 7.82 717.52 31.84 339.87 9,180.34
Depreciation for the year - 635.24 2,593.66 207.83 127.74 - 0.45 37.38 5.04 370.85 - 174.91 4,153.10
Disposals - (0.01) (29.63) (0.09) (2.59) - - - - (472.06) (31.84) (194.89) (731.11)
Balance at 31 March 2018 - 1,909.08 7,800.06 612.55 665.33 58.26 2.86 605.14 12.86 616.31 - 319.89 12,602.33
Depreciation for the year - 636.20 2,607.21 221.93 55.35 - 0.01 0.78 2.52 486.12 - 150.53 4,160.65
Disposals - - (67.60) (18.82) (12.05) - - (8.90) - (279.87) - (156.91) (544.14)
Balance at 31 March 2019 - 2,545.28 10,339.67 815.66 708.63 58.26 2.87 597.02 15.38 822.56 - 313.51 16,218.83

154
Carrying value (net)
As at 31 March 2018 227.95 13,310.24 12,896.63 696.59 84.29 - 0.01 0.89 374.31 609.66 - 290.70 28,491.27
As at 31 March 2019 227.95 12,698.24 11,534.12 675.12 96.64 - - 0.11 371.79 1,082.72 - 240.37 26,927.06
NOTES TO THE STANDALONE FINANCIAL STATEMENTS

Capital work-in-progress
Balance at 31 March 2017 242.69
Additions during the year 1,039.41
Capitalised during the year 706.93
Balance at 31 March 2018 575.17
Additions during the year 1,983.91
Capitalised during the year 1,539.63
Balance at 31 March 2019 1,019.45
Note:
(a) Leasehold land represents amounts paid to Maharashtra Industrial Development Corporation (MIDC) for land including premium, paid towards fulfillment of compliance of certain conditions
as mentioned in the agreement. The Company is in the process of registration of the lease agreement. In this regard, the Company had received a demand of Rs. 181.77 Lakhs from MIDC in
the financial year 2011-12. The said demand is with respect to the differential premium for seeking change of Company’s name from Birla 3M Limited to 3M India Limited in the records of
MIDC. The Company had filed a Civil writ petition in the High Court at Mumbai (“the Court”). The Court vide an Order dated 5 February 2015 granted interim relief to the Company by inter-
alia directing MIDC to effect the change of name in its records subject to certain conditions mentioned in the order. During current financial year, the Company has paid transfer fee of INR
14,30,250 to MIDC duly acknowledged by MIDC. A formal transfer order is awaited from MIDC.
(b) Also refer to note 15, 18, 28(a)
3M India Limited
NOTES TO THE STANDALONE FINANCIAL STATEMENTS 3M India Limited

5 Intangible assets (Rs. in lakhs)

Particulars Computer Software

Balance at 1 April 2017 137.74

Additions 9.10

Balance at 31 March 2018 146.84

Balance at 1 April 2018 146.84

Additions 16.80

Balance at 31 March 2019 163.64

Accumulated depreciation as on 1 April 2017 88.45

Amortisation for the year 27.22

Balance at 31 March 2018 115.67

Amortisation for the year 27.02

Balance at 31 March 2019 142.69

Carrying value (net)

As at 31 March 2018 31.17

As at 31 March 2019 20.95

6 Investments (Rs. in lakhs)

As at 31 March 2019 31 March 2018

Non current investment

Unquoted, carried at cost less provision for other than temporary impairment

Investment in equity instruments of subsidiary;

3M Electro & Communication India Private Limited [100% Subsidiary] 58,470.00 -

[5,00,000 equity shares of Rs. 10/- each fully paid up]

58,470.00 -

Aggregate book value of unquoted investment 58,470.00 -

Aggregate amount of impairment in value of investment - -

Investment carried at cost 58,470.00 -

During the year ended 31 March 2019, the Company has invested Rs. 58,470 Lakhs to acquire 100% equity interest in 3M Electro
& Communication India Private Limited (the entity) (Refer note 33).

155
NOTES TO THE STANDALONE FINANCIAL STATEMENTS 3M India Limited

7 Trade receivables (Rs. in lakhs)

As at 31 March 2019 31 March 2018
Considered good
Trade receivables - secured* 699.82 976.54
Trade receivables - unsecured 55,208.98 53,345.64
Less: Provision for impairment (1,294.92) (1,358.53)
54,613.88 52,963.65
Credit impaired 2,583.78 1,654.28
Less: Provision for impairment (2,583.78) (1,654.28)
54,613.88 52,963.65
Of the above, trade receivables from related parties are as below (also refer note 33):
Total trade receivables from related parties (also refer note 33) 849.23 461.55
Net trade receivables 849.23 461.55
*These are secured against deposits taken from customers.
The Company’s exposure to credit and currency risks, and loss allowances related to trade receivables are disclosed in note 40.

8 Loans receivable (Rs. in lakhs)

As at 31 March 2019 31 March 2018
Non - current
Unsecured, considered good
Security deposits - unsecured 914.85 1,183.85
Loans to employees - unsecured 24.96 20.41
Unsecured, considered doubtful
Security Deposits 67.51 67.51
Less: Provision for impairment (67.51) (67.51)
939.81 1,204.26
Current
Security deposits - unsecured 411.32 136.42
Loans to employees - unsecured 46.92 59.57
458.24 195.99
1,398.05 1,400.25

9 Other financial assets (Rs. in lakhs)

As at 31 March 2019 31 March 2018
Current
Unsecured, considered good
Unbilled revenue 1,157.85 1,039.07
Interest accrued but not due - 600.97
Others receivables from related parties (refer note 33) 1,859.20 2,452.57
Others receivables 6.43 21.48
3,023.48 4,114.09

156
NOTES TO THE STANDALONE FINANCIAL STATEMENTS 3M India Limited

10 Other assets (Rs. in lakhs)

As at 31 March 2019 31 March 2018

Non current
Capital advances 689.32 28.55
Advances other than capital advances
Payments under protest*
Unsecured, considered good 4,438.50 3,552.54
Unsecured, considered doubtful 171.50 179.72
Less: Allowance for doubtful advances (171.50) (179.72)
5,127.82 3,581.09
Current
Prepayments 922.21 662.41
Advance for supply of goods 1,121.76 483.44
Balances with Government authorities
Unsecured, considered good 3,899.05 1,865.22
Unsecured, considered doubtful 554.04 796.40
Less : Allowance for doubtful receivables (554.04) (554.04)
5,943.02 3,253.43
11,070.84 6,834.52
* The above security deposits represents deposits given to government authorities.

11 Inventories* (Rs. in lakhs)

As at 31 March 2019 31 March 2018

Raw materials 11,599.67 9,942.23
[Including in - transit Rs. 3,524.19 lakhs (2018: Rs. 3,708.83 lakhs)]
Packing materials 714.44 570.29
Work-in-progress 1,248.60 1,388.41
Finished goods 13,006.15 12,546.57
Stock-in-trade 11,349.33 10,281.43
[Including in - transit Rs. 4,005.52 lakhs (2018: Rs. 4,871.33 lakhs)]
37,918.19 34,728.93
* Refer note 3(f) for mode of valuation of inventories
The write down of inventories to net realisable value during the year amounted to Rs. 268.87 lakhs (31 March 2018 : Rs. 188.92
lakhs). The provision estimated by the management for obsolete stock during the year amounted to Rs. 779.52 lakhs (31 March
2018 : Rs. 770.32 lakhs). The write down, reversal and provision for obsolete stock are included in the costs of materials consumed
or changes in inventories of finished goods and work-in-progress.

12 Cash and cash equivalents (Rs. in lakhs)

As at 31 March 2019 31 March 2018

Balances with banks
- In current accounts 47,039.04 18,931.24
- Deposit accounts (original maturity of less than three months) - 60,000.00
47,039.04 78,931.24

157
NOTES TO THE STANDALONE FINANCIAL STATEMENTS 3M India Limited

13 Equity share capital (Rs. in lakhs except for number of shares)

As at 31 March 2019 31 March 2018

Authorised :

Equity shares 1,126.51 1,126.51

[1,12,65,070 equity shares of Rs. 10/- each

(31 March 2018 : 1,12,65,070 equity shares of Rs. 10/- each)]

1,126.51 1,126.51

Issued, subscribed and paid up:

Equity shares fully paid up 1,126.51 1,126.51

[1,12,65,070 equity shares of Rs. 10/- each

(31 March 2018 : 1,12,65,070 equity shares of Rs. 10/- each)]

1,126.51 1,126.51

(a) Reconciliation of shares outstanding at the beginning and at the end of the reporting year

31 March 2019 31 March 2018

Number of Amount Number of Amount
shares shares

Opening balance at the beginning of the year 1,12,65,070 1,126.51 1,12,65,070 1,126.51

Shares issued during the year - - - -

Closing balance at the end of the year 1,12,65,070 1,126.51 1,12,65,070 1,126.51

(b) Rights, preferences and restrictions attached to the equity shares

The Company has only one class of shares referred to as equity shares having a par value of Rs. 10 per share. Each holder of
equity shares is entitled to one vote per share held. In the event of liquidation of the Company, the holders of equity shares will
be entitled to receive any of the remaining assets of the Company, after distribution of all preferential amounts. The distribution
will be in proportion to the number of equity shares held by the shareholders.

(c) Shares held by holding Company

31 March 2019 31 March 2018

Number of Amount Number of Amount
shares shares
3M Company, USA 84,48,802 844.88 84,48,802 844.88

(d) Details of shareholders holding more than 5 % of total number of equity shares

31 March 2019 31 March 2018

Number of % holding Number of % holding
shares shares
3M Company, USA (Holding Company) 84,48,802 75% 84,48,802 75%

(e) There has been no buyback of shares, issues of shares by way of bonus shares or issue of shares pursuant to contract without
payment being received in cash for the period of five years immediately preceeding the date of the balance sheet.

158
NOTES TO THE STANDALONE FINANCIAL STATEMENTS 3M India Limited

14 Other equity (Rs. in lakhs)

As at 31 March 2019 31 March 2018

Securities premium reserve 949.90 949.90
General reserve 32.25 32.25
Remeasurement of defined benefit plans, net of tax effect (342.84) (330.07)
Retained earnings 184,187.21 151,888.13
184,826.52 152,540.21
Nature and purpose of other equity
(i) Securities premium reserve
Securities premium reserve is used to record the premium received on issue of shares. The reserve is utilised in accordance
with the provisions of the Act.
(ii) General reserve
General reserve comprises of the reserve generally available to the shareholders of the Company.
(iii) Retained earnings:
The cumulative gain or loss arising from the operations which is retained by the Company is recognised and accumulated
under the heading of retained earnings. At the end of the year, the profit after tax is transferred from the statement of profit
and loss to retained earnings.
(iv) Other comprehensive income:
Differences between the interest income on plan assets and the return actually achieved, and any changes in the liabilities
over the year due to changes in actuarial assumptions or experience adjustments within the plans, are recognised in ‘Other
equity’ and subsequently not reclassified to the Statement of Profit and Loss and will be reclassified to retained earnings.
Financial liabilities
15 Borrowings (Rs. in lakhs)
As at 31 March 2019 31 March 2018
Secured
Long term maturities of finance lease obligations (refer note below) 745.44 487.74
745.44 487.74
Note: Rate of interest for finance lease obligations ranges from 3.40% to 13.90% per annum. Finance lease obligations are
secured by hypothecation of assets underlying the leases. Finance lease obligations are payable on monthly / quarterly payment
of equated monthly installments beginning from the month subsequent to taking the lease. Period of maturity for the lease
obligations of vehicles is 4 years and for equipments it ranges from 2 years to 5 years. Also refer note 28(a).

16 Provisions (Rs. in lakhs)

As at 31 March 2019 31 March 2018

Current Non current Current Non current
Provision for employee benefits
Gratuity (refer note 32(b)) - 2,107.94 - 1,577.80
Compensated absences 57.30 446.72 55.07 429.62
Others (refer note 38)
Provision for warranty - - 12.20 69.43
Provision for asset retirement obligation - 90.55 - 90.50
Sales tax, service tax and other issues 3,179.85 - 2,048.15 -
Provision for credit notes and sales return 3,411.58 - 4,105.30 -
6,648.73 2,645.21 6,220.72 2,167.35

159
NOTES TO THE STANDALONE FINANCIAL STATEMENTS 3M India Limited

17 Trade payables (Rs. in lakhs)

As at 31 March 2019 31 March 2018

Total outstanding dues to micro and small enterprises (Refer note below) 1,825.38 1,241.18
Total outstanding dues to creditors other than micro and small enterprises* 30,509.76 30,838.77
32,335.14 32,079.95

Note

1. The principal amount and the interest due thereon remaining

unpaid to any supplier at the end of each accounting year:
- Principal 1,825.38 1,241.18
- Interest 39.61 23.64
2. The amount of interest paid by the Company in terms of Section
16 of the Micro, Small and Medium Enterprises Development Act,
2006 alongwith the amount of the payment made to the supplier
beyond the appointed date during the year:
- Interest - -
- Principal 12,120.98 1,176.60
3. The amount of interest due and payable for the period of delay in
making payment (which have been paid but beyond the appointed
day during the year) but without adding the interest specified under
the Micro, Small and Medium Enterprises Development Act, 2006. - -
4. The amount of interest accrued and remaining unpaid at the end
of each accounting year 39.61 23.64
5. The amount of further interest remaining due and payable even
in the succeeding years, until such date when the interest dues
above are actually paid to the small enterprise, for the purpose of
disallowance of a deductible expenditure under section 23 of the
Micro, Small and Medium Enterprises Development Act, 2006 127.38 87.77

Note: The above information has been determined based on vendors identified by the Company and confirmed by the vendors.

* Includes due to related party (refer note 33)

The Company’s exposure to currency and liquidity risks related to trade payables is disclosed in note 40.

18 Other financial liabilities (Rs. in lakhs)

As at 31 March 2019 31 March 2018

Current maturities of finance lease obligations (refer note 15) 604.13 458.43
Deposits from customers 974.23 990.64
Creditors for capital goods 32.72 111.92
Payroll related liabilities 5,194.24 5,553.17
Intercompany payables (refer note 33) 1,429.70 1,317.91
Accrued expenses 6,430.85 5,902.59
Other payables 501.85 244.44
15,167.72 14,579.10

*The Company’s exposure to currency and liquidity risks related to other financial liabilities are disclosed in note 40.

160
NOTES TO THE STANDALONE FINANCIAL STATEMENTS 3M India Limited

19 Other current liabilities (Rs. in lakhs)

As at 31 March 2019 31 March 2018
Advance from customers 281.65 563.57
Statutory liabilities 3,803.47 1,901.78
4,085.12 2,465.35

20 Revenue from operations (Rs. in lakhs)

For the year ended 31 March 2019 31 March 2018
Sale of products
Finished goods 154,523.50 137,521.76
Traded goods 122,497.53 117,419.78
Sale of services* 3,610.96 3,004.50
Other operating revenue
Income from duty drawback 111.43 -
Scrap sales 132.55 93.56
280,875.97 258,039.60
* Sale of services includes income from contract research Rs. 2,658.91 lakhs (31 March 2018 : Rs. 2,320.80 lakhs) (refer note
30 (c)) and management support service fee of Rs. 952.05 lakhs (31 March 2018 : Rs. 683.70 lakhs).
Disaggregation of revenue from operations:

Business Segments 31 March 2019 31 March 2018

Industrial 112,756.90 107,493.27
Health Care 42,705.35 40,062.92
Safety and Graphics 71,318.68 66,091.17
Consumer 30,348.57 27,286.70
Energy 21,051.37 15,477.61
Others 2,695.10 1,627.93
Total 280,875.97 258,039.60
Reconciliation of revenue from sale of products with the Contracted Price
Contracted Price 298,021.82 274,462.16
Less: Reduction towards volume rebates (11,502.70) (9,825.13)
Less: Reduction primarily towards sales returns (5,643.15) (6,597.43)
Revenue recognised 280,875.97 258,039.60
While disclosing the aggregate amount of transaction price yet to be recognised as revenue towards unsatisfied (or partially
satisfied) performance obligations, along with the broad time band for the expected time to recognize those revenues, the
Company has applied the practical expedient in Ind AS 115. Accordingly, the Company has not disclosed the aggregate transaction
price allocated to unsatisfied (or partially satisfied) performance obligations which pertain to contracts where revenue recognised
corresponds to the value transferred to customer typically involving event based contracts.
21 Other income (Rs. in lakhs)
For the year ended 31 March 2019 31 March 2018
Interest income from financial assets carried at amortised cost 2,685.21 3,585.56
Liabilities no longer required written back, net 597.95 534.39
Exchange gain on foreign currency transactions, net* - 241.59
3,283.16 4,361.54
* Includes unrealised gain amounting to Rs. NIL (31 March 2018: Rs. 7.29 lakhs)

161
NOTES TO THE STANDALONE FINANCIAL STATEMENTS 3M India Limited

22 Cost of materials consumed (Rs. in lakhs)

For the year ended 31 March 2019 31 March 2018
Inventory of materials at the beginning of the year 10,512.52 10,178.22
Add: Purchases 88,542.93 81,497.59
Less: Inventory of materials at the end of the year (12,314.11) (10,512.52)
86,741.34 81,163.29

23 Purchases of stock-in-trade (Rs. in lakhs)

For the year ended 31 March 2019 31 March 2018

Abrasive 8,903.57 6,683.00
Fusion bonded epoxy coating 4,819.74 2,921.37
Medical surgical and dental products 5,883.04 4,591.21
Self adhesive films 14,857.77 16,567.73
Others 28,851.11 23,207.63
63,315.23 53,970.94

24 Changes in inventories of finished goods, stock-in-trade and work-in-progress (Rs. in lakhs)

For the year ended 31 March 2019 31 March 2018

Opening inventory
- Finished goods 12,546.57 7,466.85
- Stock-in-trade 10,281.43 14,478.78
- Work-in-progress 1,388.41 1,053.95
24,216.41 22,999.58
Closing inventory
- Finished goods 13,006.15 12,546.57
- Stock-in-trade 11,349.33 10,281.43
- Work-in-progress 1,248.60 1,388.41
25,604.08 24,216.41
(Increase) in inventory (1,387.67) (1,216.83)
Less : Excise duty on opening stock of finished goods - (782.27)
Add : Excise duty on closing stock of finished goods - -
(Decrease) in excise duty - (782.27)
(1,387.67) (1,999.10)

25 Employee benefits expense (Rs. in lakhs)

For the year ended 31 March 2019 31 March 2018

Salaries, wages and bonus 25,688.70 25,764.63
Contribution to provident and other funds (refer note 32) 1,937.67 1,882.14
Share based payment expenses (refer note 31) 341.44 2,795.19
Staff welfare expenses 2,138.34 1,965.92
30,106.15 32,407.88

162
NOTES TO THE STANDALONE FINANCIAL STATEMENTS 3M India Limited

26 Finance costs (Rs. in lakhs)

For the year ended 31 March 2019 31 March 2018

Finance costs on finance lease obligations 44.44 73.13

Interest expense on financial liability measured at amortised cost 64.74 32.82

Interest on shortfall of advance tax - 88.12

109.18 194.07

27 Other expenses (Rs. in lakhs)

For the year ended 31 March 2019 31 March 2018

Consumption of stores and spares 735.35 620.93
Power and fuel* 1,643.80 1,476.90
Water charges* 35.10 32.15
Rent (refer note 28(b))* 1,942.29 1,906.62
Repairs and maintenance
- Plant and machinery 787.52 678.64
- Building* 409.32 448.28
- Others * 110.63 199.12
Insurance 213.49 244.31
Rates and taxes 1,365.75 420.64
Communication expenses * 243.87 230.01
Travel and conveyance 2,991.81 2,947.35
Legal and professional charges (refer note (a) below) 936.41 1,155.81
Selling, distribution and advertisement expenses 8,398.23 6,853.51
Commission 361.62 516.40
Freight outward 6,006.82 5,495.73
Royalty (refer note 30 (a)) 5,096.23 3,078.73
Corporate management fees (refer note 30 (b)(i)) 12,713.33 10,519.56
Directors' sitting fees 9.40 0.12
Provision for doubtful debts (net of write back) 1,027.17 744.99
Exchange loss on foreign currency transactions, net** 1,223.50 -
Expenditure towards corporate social responsibility activities (refer note 35) 770.05 564.51
Loss on sale of property, plant and equipment, (net) 1.40 8.91
Miscellaneous expenses 4,318.21 3,946.34
51,341.30 42,089.56
* Net of recoveries amounting to Rs. 201.57 lakhs (31 March 2018: Rs. 191.69 lakhs) and including payment of Rs. Nil (31 March
2018: Rs. 2.13 lakhs) from / to 3M Electro & Communication India Private Limited, a wholly owned subsidiary of 3M India Ltd.
** Unrealised forex gain Rs. 390.27 lakhs (31 March 2018 Rs. Nil)

163
NOTES TO THE STANDALONE FINANCIAL STATEMENTS 3M India Limited

(a) Payment to auditors #

31 March 2019 31 March 2018
As auditors:
Audit fee 96.00 62.50
Tax audit fee 8.00 7.00
In other capacity:
Reimbursement of out-of-pocket expenses 3.00 -
Total 107.00 69.50

# Excluding goods and service tax.

28 (a) Finance lease obligations

The Company has taken vehicles, leasehold improvements and data processing equipment under finance lease agreements.
The minimum lease rental payments under the finance leases are as under:
(Rs. in lakhs)
31 March 2019 31 March 2018
Future Present Future Present
minimum Interest value of minimum Interest value of
lease element of minimum lease element of minimum
payments MLP lease payments MLP lease
(MLP) payments (MLP) payments
Within less than one year 639.72 35.59 604.13 498.99 40.56 458.43
Between one and five years 773.50 28.06 745.44 516.75 29.01 487.74
1,413.22 63.65 1,349.57 1,015.74 69.57 946.17

(b) Operating leases

A. Leases as lessee
The Company has taken office premises, warehouse and residential premises under operating lease agreements that are
renewable on a periodic basis at the option of both the lessor and lessee. The initial tenure of the lease is generally for
eleven months to ninety six months.

i. Future minimum lease payments

At 31 March, the future minimum lease payments to be made under non-cancellable operating leases are as follows:
31 March 2019 31 March 2018
Payable in less than one year 1,385.64 1,599.86
Payable between one and five years 1,546.30 2,412.17
2,931.94 4,012.03

ii. Amounts recognised in profit or loss

31 March 2019 31 March 2018
Lease expenses – minimum lease payments 1,942.29 1,906.62
1,942.29 1,906.62

164
NOTES TO THE STANDALONE FINANCIAL STATEMENTS 3M India Limited

29 Earnings per share (Rs. in lakhs except for number of shares)

For the year ended 31 March 2019 31 March 2018

Net profit attributable to equity shareholders 32,299.08 31,053.56

Weighted average number of equity shares outstanding during the year 1,12,65,070 1,12,65,070

Nominal value of equity shares (Rs.) 10 10

Basic earnings per share (Rs.) 286.72 275.66

Diluted earnings per share (Rs.) 286.72 275.66

30 Inter Company agreements and arrangements

a) Intellectual property agreement – The Company has entered into Intellectual Property agreement with 3M
Innovative Properties Company and 3M Company, USA effective 1 July 2006 for the payment of license fees in the
form of royalties. Payments were waived off for a period of 3 years effective from 1 July 2006 to 30 June 2009.
These payments have been reinstated with effect from 1 July 2009. The Intellectual Property Agreement with 3M
Innovative Properties Company and 3M Company, USA has been revised effective 1 July 2013. Accordingly, the
Company has incurred an expenditure of Rs. 5,096.23 lakhs for the year ended 31 March 2019 (31 March 2018: Rs.
3,078.73 lakhs).
b)(i) Support services and corporate management fees - The Company has entered into support services agreement with
3M Company, USA (having expertise in establishing, operating and managing international business and incurring
costs in developing, manufacturing, marketing and selling a diverse portfolio of products) with effect from 1 April
2009. The Company is charged with comprehensive support services charges by 3M Company USA for the services
received from all the 3M group companies in the areas of Laboratory, Technical assistance and Manufacturing,
Selling and Marketing, Strategic and Managerial, Information Technology, Routine Administration and Foreign
Services Employees Expenses. This agreement supersedes the agreement entered by the Company with 3M Asia
Pacific Pte Limited dated 1 January 2003 which was terminated on 31 March 2009.
The Company has also entered into support services agreement with 3M Hong Kong Ltd with effect from 1 January
2011. The Company is charged with comprehensive support services charges by 3M Hong Kong Ltd for the services
rendered in the area of Laboratory, Technical assistance and manufacturing, Selling and marketing and strategic and
managerial. This agreement is in addition to the agreement already entered by the Company with 3M Company USA
dated 1 April 2009.
The Company has incurred the following expenditure:
(Rs. in lakhs)
31 March 2019 31 March 2018
- Laboratory and technical assistance manufacturing services 1,106.89 887.57

- Selling and marketing services 5,808.09 5,224.68

- Information technology services 3,027.44 2,845.22

- Other managerial services 2,770.91 1,562.09

12,713.33 10,519.56

- Foreign services employees expense are included in employee costs amounting to 919.81 438.55

The Company has accrued an amount of Rs. 3,445.19 lakhs (31 March 2018 : Rs.2,948.75 lakhs) in respect of estimated
liability for the above services during period 1 January 2019 to 31 March 2019, the actual liability would be ascertained by
December 2019.

165
NOTES TO THE STANDALONE FINANCIAL STATEMENTS 3M India Limited

(ii) The support service agreement enables the Company to recharge expenses relating to Foreign Service Employees (FSEs)
of 3M Company and its affiliates. Accordingly the Company has charged Rs. 1,442.94 lakhs (31 March 2018: Rs. 1,476.51
lakhs).
c) Contract research agreement – The Company has entered into contract research agreement with 3M Innovative Properties
Company and 3M Company, USA effective 1 July 2006 for carrying out contract research activities. During the year, Company
has recognized an income of Rs. 2,658.91 lakhs (31 March 2018 : Rs. 2,320.80 lakhs).

31 Employee stock option plan

A. Description of share based payment arrangements

i) Share purchase plan (equity-settled)

3M Company, USA, the parent Company has offered ‘General Employees Stock Purchase Plan’ to all the employees of the
Company, under which the employees of the Company are eligible to purchase the shares of 3M Company, USA at 85% of the
market price of the share. Under the plan, the Company deducts the amount from the monthly salary of the employees and
remits the amount to 3M Company, USA. In accordance with the plan, the Company during the year has deducted for remittance
a sum of Rs. 319.96 lakhs (2018: Rs. 262.13 lakhs) and cumulatively amounting to Rs. 1,313.06 lakhs (2018: Rs. 993.10 lakhs) from
the salary of the employees who have opted for the plan. As of the year end a sum of Rs. 32.17 lakhs (2018: Rs. 30.88 lakhs) is
pending remittance to the holding Company and the same is included under ‘Other financial liabilities’ (refer note 18).

ii) Stock appreciation rights and Restricted stock units (cash-settled)

3M Company, USA has established 3M Company Long Term Incentive Plan (LTIP). As a part of the plan, Executive Directors
and Senior Executives of the Company are eligible to acquire shares of 3M Company, USA via stock options, stock appreciation
rights (SARs), restricted stock units (RSUs) and performance shares. The eligible employees are granted stock options / stock
appreciation rights (SARs) / restricted stock units (RSUs) which will vest with the employees over a period of 3 years from the date
of the grant and they can exercise the stock option within a stipulated period mentioned in the plan. Exercise price of SARs and
RSUs will be Nil. As of the year end a sum of Rs. 3,644.91 lakhs (2018: Rs. 4,160.73 lakhs) is liability and the same is included under
‘Other financial liabilities’ (refer note 18).

B. Measurement of fair values

The Company measures compensation expense for stock appreciation rights (SARs) at their fair value determined using Black -
Scholes Model and restricted stock units (RSUs) based on fair market value of shares of 3M Company, USA on the date of the
grant.
The fair value of the cash settled SARs and the inputs used in the measurement of fair value at grant date and measurement date
of the SARs are as follows:

31 March 2019 31 March 2018

Fair value (in $) 38.93 36.23

Share price (in $) 201.12 233.63

Expected volatility (%) 20.35% 21.04%

Expected life (years) 6.55 years 6.54 years

Expected dividends (%) 2.50% 2.44%

Risk free interest rate (%) 2.58% 2.66%

The expected term of the SARs is estimated based on the vesting term and contractual term of the SARs, as well as expected
exercise behaviour of the employee who receives the SAR. Expected volatility during the expected term is based on historical
volatility of the observed market prices of the 3M Company USA’s publicly traded equity shares particularly over the historical
period commensurate with the expected term.

166
NOTES TO THE STANDALONE FINANCIAL STATEMENTS 3M India Limited

C. Reconciliation of outstanding share options

The activity in the cash-settled share based payment transactions during the year ended 31 March 2019 is set out below:

31 March 2019 31 March 2018

Shares arising Weighted Shares arising Weighted
out of average exercise out of average exercise
options price (Rs.) options price (Rs.)
Stock appreciation right
Outstanding at the beginning 73,756 - 80,289 -
Granted 9,315 - 9,824 -
Exercised 10,244 - 16,357 -
Transferred from 3M Electro & Communication India Pvt. Ltd. 2,535 - -
Outstanding at the end 75,362 - 73,756 -
Exercisable at the end 61,228 57,208
Restricted stock unit
Outstanding at the beginning 7,258 - 9,134 -
Granted 2,578 - 1,745 -
Exercised 3,717 - 3,621 -
Outstanding at the end 6,119 - 7,258 -
Exercisable at the end 3,543 4,887

D. Expense recognised in Statement of profit and loss

An amount of Rs. 341.44 lakhs (31 March 2018: Rs. 2,795.19 lakhs) has been debited to the Statement of profit and loss for the
year and included under Employee benefits expense.
E. The weighted average share price at the date of exercise with regards to SARs and RSUs exercised during the year is USD 203.81
and USD 199.23 respectively.
The above disclosures have been made to the extent information is available with the Company.
32 Employee benefits
(a) Defined contribution plan
The Company offers its employees defined contribution plans in the form of Provident Fund (PF), Superannuation Fund (SF),
Employees’ State Insurance (ESI). Contribution to SF is made to 3M India Superannuation Fund. Other contributions are made to
the Government’s funds. While both the employees and the Company pay predetermined contributions into the Provident Fund
and the ESI Scheme, contributions into superannuation fund are made only by the Company. The contributions are normally
based on a certain proportion of the employee’s salary.
During the year, the Company has recognised the following amounts in the Statement of profit and loss, which are included in
contribution to provident and other funds:
(Rs. in lakhs)
Benefits (contribution to) 31 March 2019 31 March 2018
Provident fund 1,296.74 1,276.93
Superannuation fund 129.93 116.17
Employee State Insurance Corporation 0.43 4.18
1,427.10 1,397.28

(b) Defined benefit plan

The Company provides for gratuity, a defined benefit plan (the Gratuity Plan), to its employees. The Gratuity Plan provides a
lump sum payment to vested employees, at retirement or termination of employment, of an amount based on the respective
employee’s last drawn salary and years of employment with the Company. The Company contributes all ascertained liabilities

167
NOTES TO THE STANDALONE FINANCIAL STATEMENTS 3M India Limited

towards gratuity to the 3M India Limited Employees Gratuity Fund Trust. Trustees administer contributions made to the trust. As
of 31 March 2019 and 31 March 2018, the plan assets have been primarily invested in insurer managed funds.
(Rs. in lakhs)

A. Reconciliation of opening and closing balances of the present value of the 31 March 2019 31 March 2018
defined benefit obligation
Obligation at the beginning of the year 3,867.21 3,506.28
Current service cost 390.65 373.06
Interest cost 285.93 245.95
Actuarial loss / (gains) - experience (26.94) 231.09
Actuarial loss / (gains) - financial assumptions - (144.30)
Benefits paid (226.19) (344.87)
Obligation at the end of the year 4,290.66 3,867.21

B. Reconciliation of opening and closing balances of the fair value of plan assets 31 March 2019 31 March 2018
Plan assets at the beginning of the year 2,289.41 1,953.41
Interest income on plan assets 166.01 134.15
Contribution by the Company 0.06 500.06
Remeasurements- Return on plan assets excluding amounts included in interest income (46.57) 46.66
Benefits paid (226.19) (344.87)
Plan assets at the end of the year 2,182.72 2,289.41

C. Reconciliation of present value of defined benefit obligation and the fair value of 31 March 2019 31 March 2018
plan assets to the assets and liabilities recognized in the Balance Sheet
Present value of obligation at the end of the year 4,290.66 3,867.21
Fair value of plan assets at the end of the year (2,182.72) (2,289.41)
Liability recognised in balance sheet 2,107.94 1,577.80

D. Expenses recognized in the Statement of profit and loss 31 March 2019 31 March 2018
Current service cost 390.65 373.06
Interest cost 285.93 245.95
Interest income on plan assets (166.01) (134.15)
510.57 484.86

E. Remeasurements recognized in Other comprehensive income 31 March 2019 31 March 2018

Actuarial (gains) / losses on defined benefit obligation (26.94) 86.79
Actuarial losses / (gains) on plan assets 46.57 (46.66)
19.63 40.13

F. Investment details of plan assets 31 March 2019 31 March 2018

Government securities 0.00% 0.00%
High quality corporate bonds (including public sector bonds) 0.00% 0.00%
Equity shares of listed companies 0.00% 0.00%
Property 0.00% 0.00%
Cash (including Special deposits) 1.58% 2.81%
Fund balance with Insurance companies 98.42% 97.19%
100.00% 100.00%

168
NOTES TO THE STANDALONE FINANCIAL STATEMENTS 3M India Limited

G. Assumptions 31 March 2019 31 March 2018

Discount rate (per annum) 7.60% 7.60%
Rate of escalation in salary (per annum) 6.00% 6.00%
Retirement age (in years) 60 years 60 years
Mortality rates Indian Assured Indian Assured
Lives Mortality Lives Mortality
(2006-08) (2006-08)
(modified) Ult. (modified) Ult.
Withdrawal rates
Under 30 years 15.00% 15.00%
31-34 years 10.00% 10.00%
35-44 years 5.00% 5.00%
45-50 years 3.00% 3.00%
51-54 years 2.00% 2.00%
55-60 years 1.00% 1.00%

(Rs. in lakhs)

H. Sensitivity analysis 31 March 2019 31 March 2018

The sensitivity analysis of significant actuarial assumptions as of end of reporting
period is shown below.
A. Discount rate
Effect on defined benefit obligation due to 1% increase in discount rate (349.74) (326.14)
Effect on defined benefit obligation due to 1% decrease in discount rate 403.96 377.50
B. Salary escalation rate
Effect on defined benefit obligation due to 1% increase in Salary escalation rate 406.64 380.01
Effect on defined benefit obligation due to 1% decrease in Salary escalation rate (357.97) (333.81)

(Rs. in lakhs)

I. Maturity profile of defined benefit obligation Amount

1. March 31, 2020 238.54
2. March 31, 2021 386.80
3. March 31, 2022 401.42
4. March 31, 2023 476.42
5. March 31, 2024 274.58
6. March 31, 2025 to March 31, 2029 3,329.05

Notes :
1. The discount rate is based on the prevailing market yield on Government securities as at the balance sheet date for the estimated
term of obligations.
2. The estimates of future increase in compensation levels, considered in the actuarial valuation, have been taken on account of
inflation, seniority, promotion and other relevant factors such as supply and demand in the employment market.
3. As per the best estimate of the management, contribution of Rs. Nil (31 March 2018 : Rs. Nil) is expected to be paid to the plans
during the year ending 31 March 2020.

169
NOTES TO THE STANDALONE FINANCIAL STATEMENTS 3M India Limited

33 Related party transaction

Names of related parties and nature of relationship:

i) Holding company 3M Company, USA

ii) Wholly owned subsidiary 3M Electro & Communication India Private Limited (w.e.f. 27 December, 2018)
iii) Fellow subsidiaries (with 3M China Limited 3M Belgium S.A./N.V.
whom transactions 3M Thailand Limited 3M Mexico, S.A. de C.V.
have occurred during
the year) 3M France S.A.S. 3M Singapore Pte. Ltd.
3M Gulf Limited Sumitomo 3M Limited
3M Asia Pacific Pte. Ltd 3M Film Construction(Shanghai) Co Limited
P.T. 3M Indonesia 3M Taiwan Limited
3M APAC RDC Pte Limited 3M Technologies (S) Pte Ltd
3M Argentina S.A.C.I.F.I.A. 3M Philippines, Inc.
3M Australia Pty. Limited 3M Pakistan Private Limited
3M Canada Company 3M Cogent Systems (Shenzhen) Inc.
3M Do Brasil Limitada 3M International Trading (Shanghai) Co., Ltd
3M EMEA, GmbH 3M Panama S.A
3M Espana, S.A. 3M Traffic Manufacturing (Shanghai) Co. Ltd.
3M Hong Kong Limited 3M Vietnam Limited
3M Innovation Singapore Pte Limited 3M Hellas Limited
3M Italia S.P.A. 3M Kenya Ltd.
3M Malaysia Sdn. Bhn. 3M Innovation (Thailand) Co. Ltd.
3M Svenska AB 3M Germany Hilden GmbH
3M Sanayi AS Ticaret 3M Hellas Limited
3M Korea Limited 3M Kenya Ltd.
3M Korea Health & Safety Ltd 3M CN Shenzhen
3M Korea High Tech, Korea 3M Germany Hilden GmbH
3M United Kingdom PLC 3M Hellas Limited
3M ESPE Dental AG 3M Kenya Ltd.
Dyneon GmbH 3M CN Shenzhen
3M Unitek Corporation 3M Germany Hilden GmbH
3M Material Tech(Guangzhou) Co., Limited 3M UK Holdings Limited
3M Wroclaw SP. Z O.O. 3M Wendt GmbH
Wendt Boart S.A 3M Winterthur Technologies AG
3M Saudi Arabia 3M Touch System Singapore PTE
3M Peru S.A 3M South Africa (Pty) Ltd
3M Lanka Private Limited 3M South Asia Manufacturing Company
Dyneon B.V. Private Limited
3M Sweden 3M International Group BV
Emfi Sas 3M Speciality Materials (Shanghai) Co. Ltd.
iv) Post employment 3M India Limited Employees Gratuity Fund 3M India Limited Employees Superannuation
benefit plan entities Trust Fund Trust

170
NOTES TO THE STANDALONE FINANCIAL STATEMENTS 3M India Limited

v) Key management personnel Executive Directors

Debarati Sen (Managing Director)
B V Shankaranarayana Rao (Whole- time Director)
Non-executive Directors
Amit Laroya
Bharat D. Shah
Biren Gabhawala
Radhika Rajan
Albert C. Wang (Resigned effective 21 August 2018)
Sadhana Kaul (Appointed effective 31 October 2018)
Ramesh Ramadurai
Manuel B. Pardo (Resigned effective 26 May 2017)
Jongho Lee (Appointed effective 26 May 2017)
Others
Mamta Gore (Appointed effective 01 March 2018 as Chief Financial Officer)
Panagiotis Goulakos (Resigned effective 31 December 2017 as Chief Financial Officer)
V. Srinivasan (Company Secretary)

The details of the amounts due to or due from related parties are as follows:
(Rs. in lakhs)
Name of related party 31 March 2019 31 March 2018
Trade payables
3M Company, USA 7,356.55 6,765.71
3M APAC RDC Pte Limited 2,106.99 1,841.21
3M Australia Pty. Limited - 0.31
3M Canada Company 773.75 339.86
3M China Limited 489.75 665.84
3M Do Brazil Limitada 202.10 145.41
3M Electro & Communication India Private Limited 5.34 4.77
3M EMEA, GmbH 1,732.05 2,535.12
3M France S.A.S. - 365.82
3M Gulf Limited - 21.10
3M Hong Kong Limited 2.96 32.07
3M Hellas Limited - 151.59
3M International Trading (Shanghai) Co. Ltd. 16.97 -
3M Italia S.P.A. - 22.11
3M Korea 597.13 856.78
3M Korea Health & Safety Ltd - 118.92
3M Korea High Tech Ltd, Korea 303.53 200.63
3M Material Tech(Guangzhou) Co., Limited 70.06 14.30
3M Panama S.A - 11.23
3M Panama Pacifico S Der L 12.81 -
3M Philippines, Inc. - 3.12
3M Singapore Pte. Ltd. 7,193.40 5,949.84

171
NOTES TO THE STANDALONE FINANCIAL STATEMENTS 3M India Limited

(Rs. in lakhs)
Name of related party 31 March 2019 31 March 2018
3M Speciality Materials (Shanghai) Co. Ltd. 275.52 -
3M Taiwan Limited 2.86 1.88
3M Thailand Limited 47.63 7.14
3M Unitek Corporation 20.51 72.77
3M Wroclaw Sp. Z O.O. - 9.27
Dyneon GmbH - 14.53
Dyneon B.V. 16.27 -
Emfi Sas 314.10 -
Sumitomo 3M Limited 1,977.07 2,364.97
P.T. 3M Indonesia - 0.02
23,517.35 22,516.32
Other financial liabilities
3M Company, USA 1,331.60 1,215.98
3M Electro & Communication India Private Limited 11.97 1.16
3M Singapore Pte. Ltd. 86.13 100.77
1,429.70 1,317.91
Trade receivables
3M Company, USA 13.29 84.44
3M China Limited - 0.83
3M Electro & Communication India Private Limited 101.26 1.17
3M EMEA, GmbH 74.66 34.57
3M Gulf Limited 13.49 -
3M Hong Kong Limited 15.52 8.29
3M Italia S.P.A. - 43.98
3M Korea Limited - 51.68
3M Lanka Private Limited 44.06 68.58
3M Malaysia Sdn. Bhn. 1.28 -
3M Pakistan Private Limited - 27.28
3M Philippines, Inc. 0.04 9.31
3M Singapore PTE Ltd 6.04 5.46
3M Speciality Materials (Shanghai) Co. Ltd. 7.73 7.73
3M Sanayi As Ticaret - 20.42
3M Taiwan Limited 6.14 0.30
3M Thailand Limited 106.70 76.43
3M Vietnam Limited 37.64 11.30
3M Saudi Arabia 364.80 -
P.T. 3M Indonesia 52.16 6.74
Sumitomo 3M Limited 4.42 3.04
849.23 461.55

172
NOTES TO THE STANDALONE FINANCIAL STATEMENTS 3M India Limited

(Rs. in lakhs)
Name of related party 31 March 2019 31 March 2018
Other financial assets
3M Company, USA 203.85 -
3M China Limited 553.41 516.40
3M Kenya Ltd. - 12.20
3M Korea Limited 462.19 492.34
3M Innovation Singapore Pte Ltd - 78.31
3M Thailand Limited 35.98 26.53
3M Lanka Private Limited - 130.21
P.T. 3M Indonesia 213.67 292.64
3M Speciality Materials (Shanghai) Co. Ltd. - 22.94
3M United Kingdom Plc - 9.39
3M France S.A.S. - 96.68
3M Belgium S.A/N.V - 18.82
3M Argentina S.A.C.I.F.I.A. - 710.85
3M Cogent Systems (Shenzhen) Inc. - 10.65
3M Malaysia Sdn. Bhn. 27.37 -
3M APAC RDC Pte Limited - 0.04
3M International Trading (Shanghai) Co. Ltd. 345.25 31.34
3M South Asia Manufacturing Company Private Limited 17.48 -
3M Traffic Manufacturing (Shanghai) Co. Ltd. - 3.23
1,859.20 2,452.57

Investment in shares of subsidiary company 31 March 2019 31 March 2018

3M Electro & Communication India Private Limited 58,470.00 -
58,470.00 -
Details of the related party transactions entered into by the Company are as follows:
Name of related party 31 March 2019 31 March 2018
Remuneration paid to Key management personnel #
Debarati Sen 567.70 474.96
B V Shankaranarayana Rao 224.44 183.53
Mamta Gore 364.62 15.33
Panagiotis Goulakos - 179.74
V. Srinivasan 46.17 43.42
1,202.93 896.98
# Excludes contributions to employee retirement / post retirement and other employee benefits which are based on actuarial
valuation done on an overall Company basis.
Sitting fees and commission paid to Key management personnel (Rs. in lakhs)

Name of related party 31 March 2019 31 March 2018

Bharat D. Shah 18.60 18.40
Biren Gabhawala 18.20 18.00
Radhika Rajan 17.60 17.00
54.40 53.40

173
NOTES TO THE STANDALONE FINANCIAL STATEMENTS 3M India Limited

(Rs. in lakhs)
Name of related party 31 March 2019 31 March 2018
Sales of products (net of returns)
3M Company, USA 218.33 320.66
3M Gulf Limited 110.37 92.93
3M Thailand Limited 448.02 304.66
3M Malaysia Sdn Bhd 2.62 311.77
3M Korea Limited 39.01 69.86
P.T. 3M Indonesia 144.46 50.13
3M Italia S.P.A - 127.25
3M EMEA, GmbH 219.09 13.97
3M Pakistan Private Limited 35.55 61.83
3M Lanka Private Limited 39.92 42.98
3M China Limited 18.79 30.41
3M Electro & Communication India Private Limited 94.58 70.83
3M Hong Kong Limited 54.26 12.88
3M Taiwan Limited 6.18 0.30
3M Philippines, Inc 0.04 25.56
3M Australia Pty. Limited - 9.32
3M Vietnam Limited 102.96 10.09
3M Sanay AS Ticaret - 20.52
3M Singapore Pte. Ltd. 7.82 10.53
3M Mexico, S.A. de C.V. - 1.74
Sumitomo 3M Limited 75.07 8.12
3M Saudi Arabia 1,018.02 31.39
3M South Africa (Pty) Ltd - 0.19
3M Asia Pacific Pte Ltd 0.38 -
3M Do Brasil Limitada 61.33 -
2,696.80 1,627.92
Contributions during the year
3M India Limited Employees Gratuity Fund Trust 0.06 500.06
3M India Ltd Employees Superannuation Fund Trust 129.93 116.17
129.99 616.23
Investment in shares of subsidiary company
3M International Group B.V. 28,650.30 -
3M Company, USA 29,819.70 -
58,470.00 -

174
NOTES TO THE STANDALONE FINANCIAL STATEMENTS 3M India Limited
(Rs. in lakhs)
Name of related party 31 March 2019 31 March 2018
Income from contract research
3M Company, USA 2,658.91 2,320.80
2,658.91 2,320.80
Income from management support services
3M Company, USA 895.38 553.49
3M South Asia Manufacturing Company Private Limited 87.41 -
3M Lanka Private Limited - 130.21
982.79 683.70
Reimbursement of expenses received
3M Company, USA 2,060.64 1,096.11
P.T. 3M Indonesia 419.37 390.72
3M Korea Limited 444.97 476.11
3M Singapore PTE Ltd 145.82 165.38
3M Film Construction (Shanghai) Co Limited - 390.68
3M Thailand Limited 37.04 23.22
3M Kenya Ltd. - 12.07
3M Malaysia SDN. BHD 66.42 -
3M China Limited 329.32 -
3M Electro & Communication India Private Limited 201.57 191.69
3,705.15 2,745.98
Sale of capital goods
3M Svenska AB - 4.73
- 4.73
Purchase of materials (net of returns)
3M Company, USA 34,029.77 30,457.89
3M APAC RDC Pte Limited 6,719.52 6,444.44
3M Belgium S.A./N.V. 7.71 10.85
3M Canada Company 993.51 405.56
3M China Limited 975.42 800.20
3M CN Shenzhen - 1.63
3M Do Brasil Limitada 375.93 236.91
3M EMEA, GmbH 2,663.06 3,334.14
3M Espana, S.A. 777.60 105.10
3M ESPE Dental AG 173.33 601.26
3M France S.A.S. 876.91 806.64
3M Germany Hilden GmbH 2,562.77 -
3M Hong Kong Limited 13.20 8.71
3M Innovation (Thailand) Co. Ltd. 2.68 0.76
3M Innovation Singapore Pte Limited 23,638.31 15,580.58
3M Italia S.P.A. 39.51 45.59
3M Korea Health & Safety Ltd 0.91 577.09
3M Korea Limited 1,469.47 2,090.18
3M Malaysia Sdn. Bhn. 6.40 -

175
NOTES TO THE STANDALONE FINANCIAL STATEMENTS 3M India Limited

(Rs. in lakhs)
Name of related party 31 March 2019 31 March 2018
3M Material Tech(Guangzhou) Co., Limited 73.80 0.14
3M Panama S.A 20.99 18.53
3M Philippines, Inc. - 3.38
3M Speciality Materials (Shanghai) Co. Ltd. 526.14 357.43
3M Taiwan Limited 10.16 13.20
3M Thailand Limited 162.43 209.32
3M UK Holdings Limited 896.03 1,539.64
3M United Kingdom PLC - 10.92
3M Unitek Corporation 68.88 230.49
3M Wendt GmbH 47.03 131.00
3M Winterthur Technologies AG 1,014.90 336.07
3M Wroclaw SP. Z O.O. 484.59 203.30
Dyneon B.V. - 23.05
Dyneon GmbH 1,349.36 1,395.48
3M International Trading (Shanghai) Co., Ltd 33.30 108.98
3M Korea High Tech, Korea 416.96 550.34
3M Singapore Pte. Ltd. 296.60 1.30
3M Technologies (S) Pte Ltd - 25.46
3M Touch System Singapore PTE 1.96 4.08
Wendt Boart S.A - 0.34
3M Sweden 42.54 553.97
3M Peru S.A 63.41 -
P.T. 3M Indonesia - 10.29
Sumitomo 3M Limited 7,753.16 7,412.55
3M Electro & Communication India Private Limited 12.19 -
88,600.44 74,646.79
Corporate management fees (excluding ineligible portion of Goods and Service Tax)
3M Company, USA 12,713.33 10,311.42
3M Hong Kong Limited - 32.07
12,713.33 10,343.49
Royalty (excluding ineligible portion of Goods and Service Tax)
3M Company, USA 5,096.23 3,021.06
5,096.23 3,021.06
Recharges of expenses paid
3M Company, USA 684.79 339.37
3M Hellas Limited - 99.18
3M Lanka Private Limited 30.74 -
3M Gulf Limited 235.02 -
950.55 438.55

34 Segment Reporting
In accordance with Ind AS 108 ‘Operating segments’, segment information are included in the consolidated financial statement
of the Company and therefore no separate disclosure on segment information has been given in these standalone financial
statements.

176
NOTES TO THE STANDALONE FINANCIAL STATEMENTS 3M India Limited

35 Corporate social responsibility

During the year, the amount required to be spent on corporate social responsibility activities amounted to Rs. 768.00 lakhs
(31 March 2018: Rs. 557.92 lakhs) in accordance with Section 135 of the Companies Act, 2013. The following amounts were spent
during the current and previous year:
(Rs. in lakhs)
For the year ended 31 March 2019 31 March 2018
Amount spent other than for construction / acquisition of any asset 770.05 564.51
Total 770.05 564.51

36 Contingent liabilities and commitments: (Rs. in lakhs)

As at 31 March 2019 31 March 2018
a) Guarantees:
- Issued by Company’s bankers 4,279.47 2,196.94
b) Claims against the Company not acknowledged as debts:
- Income tax demand (including interest) (refer note (i) below) 12,768.35 9,351.26
- Custom duty demands (refer note (ii) and (iii) below) 18,348.54 18,348.54
- Sales tax matters (refer note (iv) below) 5,963.47 6,363.17
- Service tax matters (refer note (v) below) 917.01 782.15
- Central excise duty matters (refer note (vi) below) 1,206.27 1,128.30
c) Bills discounted 118.33 109.97

Notes:
(i) Income tax matters mainly relate to intercompany charges.
(ii) The Company during the year 2012-13 had received an order from The Commissioner of Customs demanding differential
duty, interest and penalty of Rs.1,961.50 lakhs, contending the availment of concessional import duty in respect of some of
its products for which a demand notice was served on the Company for payment of the above amount. The Company has
filed an appeal against the order including for obtaining a stay against any recovery proceedings that may be initiated and
accordingly no liability has been recognised in the books.
(iii) The Company was issued a Show Cause Notice dated 8th December 2016 by the Directorate of Revenue Intelligence (DRI)
in relation to levy of customs duty on inter-company transactions for import of goods and services and hence proposing to
demand differential duty of customs covering the transactions during the period 8th December 2011 to 7th February 2014.
The Company has received an order in original on 1st October 2017 from Additional Director General – DRI (Adjudication),
Mumbai confirming the demand raised for customs duty in show cause notice to the tune of Rs.7,693.52 lakhs along with
penalty equivalent to the customs duty amount and additional penalty and interest of Rs.1,000 lakhs. The Company has
filed an appeal against this order with CESTAT, Mumbai after making payment of mandatory deposit of Rs.577 lakhs.
(iv) Sales tax cases primarily pertains to Maharashtra Value Added Tax Act, 2002 and Karnataka Value Added Tax Act, 2003.
These are pertaining to the years from 2005-06 to 2013-14. These cases are with respect to the applicable rate of tax for
various products and matters pertaining to declaration forms.
(v) Service tax matters relates to cases with respect to manner of apportionment of credit availed by the Company without
registering as an Input service distributor.
(vi) Excise matters relates to penalty for allegedly dealing in goods liable to confiscation under Rule 26 of the Central Excise Act.
(vii) The Supreme court of India in the month of February 2019 had passed a judgement relating to definition of wages under the
Provident Fund Act, 1952. However, considering that there are numerous interpretative issues relating to this judgement
and in the absence of reliable measurement of the provision for the earlier periods, the Company has made a provision for
provident fund contribution pursuant to the judgement only for the current year. The Company will evaluate its position

177
NOTES TO THE STANDALONE FINANCIAL STATEMENTS 3M India Limited

and update its provision, if required, on receiving further clarity on the subject. The Company does not expect any material
impact of the same.

Capital commitments 31 March 2019 31 March 2018

Estimated value of contracts in capital account remaining to be executed 982.64 365.81
During the year ended 31 March 2019 no material foreseeable loss (previous year: nil) was incurred for any long-term contract
including derivative contracts.

37 Tax expenses
(a) Amount recognised in Statement of profit and loss (Rs. in lakhs)
31 March 2019 31 March 2018
Current tax 18,652.61 17,256.13
Deferred tax expense / (income) related to:
Origination and reversal of temporary differences (1,205.76) (341.39)
Tax expense for the year 17,446.85 16,914.74

(b) Reconciliation of effective tax rate (Rs. in lakhs)

31 March 2019 31 March 2018
Profit before tax 49,745.93 47,968.30
Tax at statutory income tax rate 34.94% (31 March 2018 - 34.61%) 34.944% 17,383.22 34.610% 16,601.83
Tax effects of amounts which are not deductible / (taxable)
in calculating taxable income:
Non-deductible expenses 0.30% 147.40 0.91% 438.64
Others -0.17% (83.77) -0.26% (125.73)
Income tax expense 35.07% 17,446.85 35.26% 16,914.74

(c) Deferred tax assets and liabilities are attributable to the following: (Rs. in lakhs)
Deferred tax assets Deferred tax liabilities Deferred tax (assets) / liabilities net
Particulars
31 March 2019 31 March 2018 31 March 2019 31 March 2018 31 March 2019 31 March 2018
Property, plant and equipment - - 2,009.81 2,087.37 2,009.81 2,087.37
Employee benefits expense 1,011.74 888.93 - - (1,011.74) (888.93)
Provisions 3,345.49 2,333.24 - - (3,345.49) (2,333.24)
4,357.23 3,222.17 2,009.81 2,087.37 (2,347.42) (1,134.80)

(d) Movement in temporary differences

(Rs. in lakhs)
Balance Recognised Recognised Recognised Balance
Particulars as at in in directly in Others as at
1 April 2017 profit or loss OCI equity 31 March 2018
Property, plant and equipment 2,206.27 (118.90) - - - 2,087.37
Employee benefits expense (834.52) (40.53) (13.88) - - (888.93)
Provisions (2,093.01) (240.23) - - - (2,333.24)
Other items (58.27) 58.27 - - - -
(779.53) (341.39) (13.88) - - (1,134.80)

178
NOTES TO THE STANDALONE FINANCIAL STATEMENTS 3M India Limited

(Rs. in lakhs)

Balance Recognised Recognised Recognised Balance

Particulars as at in in directly in Others as at
1 April 2018 profit or loss OCI equity 31 March 2019
Property, plant and equipment 2,087.37 (77.56) - - - 2,009.81

Employee benefits expense (888.93) (115.95) (6.86) - - (1,011.74)

Provisions (2,333.24) (1,012.25) - - - (3,345.49)

(1,134.80) (1,205.76) (6.86) - - (2,347.42)

(e) Details of income tax assets and income tax liabilities (Rs. in lakhs)

31 March 2019 31 March 2018

Income tax assets (net) 5,519.96 4,330.16

Current tax liabilities (net) (1,787.93) (1,868.32)

Net current income tax asset/ (liability) at the end of the year 3,732.03 2,461.84

(f) The gross movement in the current income tax asset / (liability) (Rs. in lakhs)

31 March 2019 31 March 2018

Net current income tax asset / (liability) at the beginning of the year 2,461.84 284.04

Income tax paid 19,922.80 19,433.93

Current income tax expense (18,652.61) (17,256.13)

Net current income tax asset/ (liability) at the end of the year 3,732.03 2,461.84

38 Provision movement (Rs. in lakhs)

Utilisation/
Particulars 1 April 2018 Addition 31 March 2019
reversals
a) Warranty 81.63 - 81.63 -
b) Asset retirement obligation 90.50 0.05 - 90.55
c) Sales tax, service tax and other issues 2,048.15 1,221.34 89.64 3,179.85
d) Credit notes and sales return 4,105.30 3,411.58 4,105.30 3,411.58
6,325.58 4,632.97 4,276.57 6,681.98

Utilisation/
Particulars 1 April 2017 Addition 31 March 2018
reversals
a) Warranty 233.40 - 151.77 81.63
b) Asset retirement obligation 90.47 0.03 - 90.50
c) Sales tax, service tax and other issues 1,627.30 420.85 - 2,048.15
d) Credit notes and sales return 3,888.64 4,105.30 3,888.64 4,105.30
5,839.81 4,526.18 4,040.41 6,325.58

179
NOTES TO THE STANDALONE FINANCIAL STATEMENTS 3M India Limited

39 Capital management
The Company’s policy is to maintain a stable capital base so as to maintain investor, creditor and market confidence and to sustain
future development of the business. Management monitors capital on the basis of return on capital employed as well as the debt
to total equity ratio.
For the purpose of debt to total equity ratio, debt is debt as considered under long-term and short-term borrowings which is
on account of finance lease on office equipment and vehicles. Total equity comprise of issued share capital and all other equity
reserves.
The capital structure as of 31 March 2019 and 31 March 2018 was as follows:
(Rs. in lakhs)

Particulars 31 March 2019 31 March 2018

Debt 1,349.57 946.17
Total equity 185,953.03 153,666.72
Debt to total equity ratio 0.73% 0.62%

40 Financial Instruments - Fair values and risk management

A. Accounting classification and fair values
The following table shows the carrying amounts of financial assets and financial liabilities as at 31 March 2019
(Rs. in lakhs)
Carrying amount
Mandatorily FVOCI- FVOCI- Other finan- Total
Note at FVTPL - debt equity cial assets carrying
others instruments instruments - amortised amount
cost
Financial assets not measured at fair value

Trade receivables 7 - - - 54,613.88 54,613.88

Loans to employees 8 - - - 71.88 71.88

Security deposits 8 - - - 1,326.17 1,326.17

Other financial assets 9 - - - 3,023.48 3,023.48

Cash and cash equivalents 12 - - - 47,039.04 47,039.04

- - - 106,074.45 106,074.45

Financial liabilities not measured at fair value

Finance lease obligation 15,18 - - - 1,349.57 1,349.57

Trade payables 17 - - - 32,335.14 32,335.14

Other financial liabilities 18 - - - 14,563.59 14,563.59

- - - 48,248.30 48,248.30

The fair value of financial assets and financial liabilities approximates to their carrying amount largely due to the short-term
nature of these instruments.

180
NOTES TO THE STANDALONE FINANCIAL STATEMENTS 3M India Limited

The following table shows the carrying amounts of financial assets and financial liabilities as at 31 March 2018
(Rs. in lakhs)
Carrying amount
Mandatorily FVOCI- FVOCI- Other Total
Note at FVTPL - debt equity financial carrying
instruments instruments assets - amount
amortised
Financial assets not measured at fair value
Trade receivables 7 - - - 52,963.65 52,963.65
Loans to employees 8 - - - 79.99 79.99
Security deposits 8 - - - 1,320.27 1,320.27
Other financial assets 9 - - - 4,114.09 4,114.09
Cash and cash equivalents 12 - - - 78,931.24 78,931.24
- - - 137,409.24 137,409.24
Financial liabilities not measured at fair value
Finance lease obligation 15, 18 - - - 946.17 946.17
Trade payables 17 - - - 32,079.95 32,079.95
Other financial liabilities 18 - - - 14,120.67 14,120.67
- - - 47,146.79 47,146.79

The fair value of financial assets and financial liabilities approximates to their carrying amount largely due to the short-term
nature of these instruments.
B. Financial Risk Management
The Company has exposure to the following risk arising from financial instruments
- Credit risk
- Liquidity risk
- Market risk

i. Risk management framework

The Company’s principal financial liabilities comprise finance lease obligations, trade and other payables. The main purpose of
these financial liabilities is to finance the Company’s operations. The Company’s principal financial assets include trade and other
receivables, cash and cash equivalents that are derived directly from its operations.

ii. Credit risk

Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its
contractual obligations, and arises principally from the Company’s receivables from customers.
(a) Financial assets that are not credit impaired
The Company has financial assets which are in the nature of cash and cash equivalents, loans to employees, unbilled
revenue from related party, interest accrued on fixed deposits and receivables from related parties which are not credit
impaired. These are contractually agreed with either banks, related parties or employees where the probability of default
is negligible.
(b) Financial assets that are credit impaired
Trade receivables
The Credit services team has established a credit policy under which each new customer is analysed individually for
creditworthiness before the Company’s standard payment and delivery terms and conditions are offered. The Company’s
review includes external ratings, if they are available. Sale limits are established for each customer and reviewed yearly.

181
NOTES TO THE STANDALONE FINANCIAL STATEMENTS 3M India Limited

The Company establishes an allowance for impairment that represents its estimate of expected losses in respect of trade
receivables.
The maximum exposure to credit risk for trade receivables by geographic region is as follows: (Rs. in lakhs)
Carrying amount
31 March 2019 31 March 2018
India 57,744.61 55,514.91
Other regions 747.97 461.55
58,492.58 55,976.46
The maximum exposure to credit risk for trade receivables by type of counterparty is as follows:
(Rs. in lakhs)
Carrying amount
31 March 2019 31 March 2018
Distributors 30,146.05 31,004.37
Other 28,346.53 24,972.09
58,492.58 55,976.46
Less: Receivables from related party, secured receivables and receivables not considered for credit risk 3,939.45 1,438.09
Net receivables 54,553.13 54,538.37
Expected credit loss assessment for the Company as 31 March 2018 and 2019.
The Company has divided all the debtors outstanding for the last twelve quarters into age brackets of not due, 0-90 days, 91-180
days, 181-270 days, 271-365 days and amounts outstanding for more than one year.
The Company has calculated the impairment loss arising on account of past trends in the default rate for time bucket.
When determining whether the credit risk of a financial asset has increased significantly since initial recognition and when
estimating expected credit losses, the Company considers reasonable and supportable information that is relevant and
available without undue cost or effort. This includes both quantitative and qualitative information and analysis, based
on the Company’s historical experience and informed credit assessment and including forward looking information.
Expected credit losses are a probability-weighted estimate of credit losses. Credit losses are measured as the present value of all
cash shortfalls (i.e. the difference between the cash flows due to the Company in accordance with the contract and the cash flows
that the Company expects to receive).
Out of the total trade receivables of Rs. 58,492.58 lakhs (31 March 2018: 55,976.46 lakhs), the exposure considered for expected
credit loss is Rs. 54,553.13 lakhs (31 March 2018 :Rs. 54,538.37). The balance which is not considered for impairment pertains to
intercompany receivables and secured debtors.
The following table provides information about the exposure to credit risk and expected credit loss for trade and other receivables:
(Rs. in lakhs)
Gross carrying Weighted Loss
amount average loss rate allowance
31 March 2019
Current (not past due) 41,020.47 1.60% 656.45
0-90 days 10,526.91 5.38% 566.11
91-180 days 220.66 32.79% 72.36
181-270 days 684.90 70.61% 483.59
271-360 days 638.24 100.00% 638.24
> 360 days 1,461.95 100.00% 1,461.95
54,553.13 3,878.70

182
NOTES TO THE STANDALONE FINANCIAL STATEMENTS 3M India Limited

Gross carrying Weighted Loss

amount average loss rate allowance
31 March 2018
Current (not past due) 45,804.07 1.62% 741.62
0-90 days 5,745.68 6.19% 355.87
91-180 days 1,237.74 21.09% 261.04
181-270 days 193.83 62.30% 120.76
271-360 days 392.07 94.00% 368.55
> 360 days 1,164.98 100.00% 1,164.97
54,538.37 3,012.81
Movements in the allowance for impairment in respect of trade and other receivables
The movement in the allowance for impairment in respect of trade and other receivables is as follows: (Rs. in lakhs)
31 March 2019 31 March 2018
Balance as at 1 April 3,012.81 2,267.82
Utilised during the year (161.28) -
Impairment loss recognised 1,027.17 744.99
Balance as at 31 March 3,878.70 3,012.81

iii. Liquidity risk

Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with its financial liabilities
that are settled by delivering cash or another financial asset. The Company’s approach to managing liquidity is to ensure, as far as
possible, that it will have sufficient liquidity to meet its liabilities when they are due, under both normal and stressed conditions,
without incurring unacceptable losses or risking damage to the Company’s reputation.
The Company believes that the working capital is sufficient to meet its current requirements. Accordingly, no liquidity risk is
perceived.
The table below provides details regarding the contractual maturities of significant financial liabilities: (Rs. in lakhs)

Less than More than

Particulars 1-2 years 2-5 years Total
1 year 5 years
31 March 2019
Non-derivative financial liabilities
Finance lease obligations 604.13 474.03 271.41 - 1,349.57
Trade and other payables 46,898.73 - - - 46,898.73
47,502.86 474.03 271.41 - 48,248.30
31 March 2018
Non-derivative financial liabilities
Finance lease obligations 458.43 296.43 191.31 - 946.17
Trade and other payables 46,200.62 - - - 46,200.62
46,659.05 296.43 191.31 - 47,146.79
iv. Market risk
Market risk is the risk that changes in market prices – such as foreign exchange rates will affect the Company’s income or the
value of its holdings of financial instruments. Market risk is attributable to all market risk sensitive financial instruments including
foreign currency receivables and payables. The Company is exposed to market risk primarily related to foreign exchange rate
risk. Thus, the exposure to market risk is a function of investing and borrowing activities and revenue generating and operating
activities in foreign currency. The objective of market risk management is to avoid excessive exposure in our foreign currency
revenues and costs.

183
NOTES TO THE STANDALONE FINANCIAL STATEMENTS 3M India Limited

Exposure to currency risk

The summary quantitative data about the Company’s exposure to currency risk as reported to the management is as follows:
(Rs. in lakhs)
31 March 2019 31 March 2018
USD EURO SGD Others USD EURO Others
Trade and other payables 13,219.72 2,187.53 7,279.53 2,757.78 18,812.07 3,146.66 2,833.05
Trade and other receivables 2,589.69 - 2,912.95 - -
Net exposure in respect of recognised assets and liabilities 10,630.03 2,187.53 7,279.53 2,757.78 15,899.12 3,146.66 2,833.05
Sensitivity analysis
A reasonably possible strengthening (weakening) of the US Dollar or Euro or SGD against all other currencies as at 31 March
would have affected the measurement of financial instruments denominated in a foreign currency and affected equity and profit
or loss by the amounts shown below. This analysis assumes that all other variables, in particular interest rates, remain constant
and ignores any impact of forecast sales and purchases.
(Rs. in lakhs)
Profit or loss Equity, net of tax
Strengthening Weakening Strengthening Weakening
31 March 2019
USD (for 1% movement) 106.30 (106.30) 69.15 (69.15)
EURO (for 1% movement) 21.88 (21.88) 14.23 (14.23)
SGD (for 1% movement) 72.80 (72.80) 47.36 (47.36)
Others (for 1% movement) 27.58 (27.58) 17.94 (17.94)
228.56 (228.56) 148.68 (148.68)
31 March 2018
USD (for 1% movement) 158.99 (158.99) 103.90 (103.90)
EURO (for 1% movement) 31.47 (31.47) 20.56 (20.56)
Others (for 1% movement) 28.33 (28.33) 18.51 (18.51)
218.79 (218.79) 142.97 (142.97)
41 Research and development expenses (Rs. in lakhs)
For the year ended 31 March 2019 31 March 2018
Capital expenditure 162.31 235.00
Revenue expenditure 5,265.00 5,656.60
5,427.31 5,891.60
42 The disclosures regarding details of specified bank notes held and transacted during 8 November 2016 to 30 December 2016 has
not been made in these financial statements since the requirement does not pertain to financial year ended 2019.

As per our report of even date attached

For B S R & Co. LLP For and on behalf of the Board of Directors
Chartered Accountants
Firm registration number: 101248W/W-100022 Debarati Sen B V Shankaranarayana Rao
Managing Director Whole-time Director
Amit Somani [DIN: 07521172] [DIN – 00044840]
Partner
Membership No: 060154 Mamta Gore V. Srinivasan
Place: Paris Place: Bangalore Chief Financial Officer Company Secretary
Date: May 28, 2019 Date: May 28, 2019 [PAN: AKIPG9089M] [ACS – 16430]

184
INDEPENDENT AUDITORS’ REPORT 3M India Limited

INDEPENDENT AUDITORS’ REPORT

To the Members of 3M India Limited

Report on the Audit of Consolidated Financial Statements

Opinion
We have audited the consolidated financial statements of 3M India Limited (hereinafter referred to as the ‘Holding Company”) and
its subsidiary (Holding Company and its subsidiary together referred to as “the Group”), which comprise the consolidated balance
sheet as at 31 March 2019, and the consolidated statement of profit and loss (including other comprehensive income), consolidated
statement of changes in equity and consolidated statement of cash flows for the year then ended, and notes to the consolidated
financial statements, including a summary of significant accounting policies and other explanatory information (hereinafter referred to
as “the consolidated financial statements”).
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid consolidated financial
statements give the information required by the Companies Act, 2013 (“Act”) in the manner so required and give a true and fair view in
conformity with the accounting principles generally accepted in India, of the consolidated state of affairs of the Group as at 31 March
2019, of its consolidated profit and other comprehensive income, consolidated changes in equity and consolidated cash flows for the
year then ended.

Basis for Opinion

We conducted our audit in accordance with the Standards on Auditing (SAs) specified under section 143(10) of the Act. Our responsibilities
under those SAs are further described in the Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements section of
our report. We are independent of the Group in accordance with the Code of Ethics issued by the Institute of Chartered Accountants
of India, and we have fulfilled our other ethical responsibilities in accordance with the provisions of the Act. We believe that the audit
evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated
financial statements of the current year. These matters were addressed in the context of our audit of the consolidated financial
statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

Description of Key Audit Matter

Investment in 3M Electro & Communication India Private Limited
See note 3(b) and 42 to the consolidated financial statements
The key audit matter How the matter was addressed in our audit
• During the year, the Holding Company acquired 100% stake Our audit procedures included:
in 3M Electro & Communication India Private Limited from • Assessment of the controls to identify and disclose related
its existing shareholders (related parties of the Holding party relationships and transactions in accordance with the
Company) at a consideration of INR 58,470 lakhs. relevant accounting standards.
• This acquisition has been accounted as a common control • Assessment of compliance with the regulations under the
transaction in the consolidated financial statements. As a Companies Act, 2013 and the listing regulations with respect
result, the Holding Company has consolidated the book value to the investment.
of net assets acquired of INR 9,188 lakhs and the excess • Evaluating the work of the external expert for fair valuation of
consideration paid has been adjusted in the consolidated the acquired entity, reasonableness of the methodology and
“other equity” as on the beginning of the comparative period the underlying assumptions used in the valuation.
i.e. 1 April 2017.
• Evaluating the accounting and disclosures of the business
• We identified the above investment transaction as a key audit combination transaction amongst common controlled
matter given it involved compliance with various regulations entities in compliance with the accounting standards.
and fair valuation of the acquiree.

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INDEPENDENT AUDITORS’ REPORT 3M India Limited

Revenue Recognition

See note 3(i) and 19 to the Consolidated financial statements

The key audit matter How the matter was addressed in our audit
• The Group recognises revenue when control is transferred Our audit procedures included:
to the customer i.e. on delivery to customer. The Group
• Assessing the appropriateness of the revenue recognition
tracks proof of delivery and reverses the value of goods not
accounting policies in compliance with the accounting
delivered by the balance sheet date.
standards.
• We identified revenues recognised closer to the balance
• Tested the design and operating effectiveness of relevant key
sheet date as a key audit matter given it is a significant key
controls with respect to revenue recognition on a sample
performance indicator and there is a risk of overstatement of
basis.
revenues at the balance sheet date.
• We performed substantive testing by selecting samples (using
statistical sampling) of revenue transactions, recorded during
the year by testing the underlying documents.
• Analytical procedures on revenue recognised during the year
to identify and inquire on unusual variances, if any.
• Independent confirmation on a sample basis of customer
invoice balances at the balance sheet date using statistical
sampling.
• Obtaining supporting documentation, on a sample basis for
sales transactions recorded near to balance sheet date as well
as credit notes issued subsequent to the balance sheet date
to determine whether revenue was recognised in the correct
period.
• Tested, on a sample basis using statistical sampling, manual
journal entries relating to revenues to identify and inquire on
unusual items, if any.

Other Information
The Holding Company’s Management and Board of Directors are responsible for the other information. The other information
comprises the information included in the Holding Company’s annual report, but does not include the financial statements and our
auditors’ report thereon.
Our opinion on the consolidated financial statements does not cover the other information and we do not express any form of assurance
conclusion thereon.
In connection with our audit of the consolidated financial statements, our responsibility is to read the other information and, in doing
so, consider whether the other information is materially inconsistent with the consolidated financial statements or our knowledge
obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed and based on the work
done, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing
to report in this regard.

Responsibilities of Management and Those Charged with Governance for the Consolidated Financial Statements
The Holding Company’s management and Board of Directors are responsible for the preparation and presentation of these consolidated
financial statements in term of the requirements of the Act that give a true and fair view of the consolidated state of affairs, consolidated
profit/ loss and other comprehensive income, consolidated statement of changes in equity and consolidated cash flows of the
Group in accordance with the accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS)
specified under section 133 of the Act. The respective Board of Directors of the companies included in the Group are responsible for
maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of each company
and for preventing and detecting frauds and other irregularities; the selection and application of appropriate accounting policies;
making judgments and estimates that are reasonable and prudent; and the design, implementation and maintenance of adequate
internal financial controls, that were operating effectively for ensuring accuracy and completeness of the accounting records, relevant
to the preparation and presentation of the consolidated financial statements that give a true and fair view and are free from material

186
INDEPENDENT AUDITORS’ REPORT 3M India Limited

misstatement, whether due to fraud or error, which have been used for the purpose of preparation of the consolidated financial
statements by the Directors of the Holding Company, as aforesaid.
In preparing the consolidated financial statements, the respective management and Board of Directors of the companies included in
the Group are responsible for assessing the ability of each company to continue as a going concern, disclosing, as applicable, matters
related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company
or to cease operations, or has no realistic alternative but to do so.
The respective Board of Directors of the companies included in the Group is responsible for overseeing the financial reporting process
of each company.

Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material
misstatement, whether due to fraud or error, and to issue an Auditor’s Report that includes our opinion. Reasonable assurance is a high
level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement
when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could
reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.
As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the
audit. We also:
• Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design
and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a
basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from
error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the
circumstances. Under section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the company has
adequate internal financial controls with reference to financial statements in place and the operating effectiveness of such controls.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures
made by management.
• Conclude on the appropriateness of management’s use of the going concern basis of accounting in preparation of consolidated
financial statements and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions
that may cast significant doubt on the appropriateness of this assumption. If we conclude that a material uncertainty exists, we are
required to draw attention in our Auditor’s Report to the related disclosures in the consolidated financial statements or, if such
disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our
Auditor’s Report. However, future events or conditions may cause the Group (company and subsidiary) to cease to continue as a
going concern.
• Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and
whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair
presentation.
• Obtain sufficient appropriate audit evidence regarding the financial information of such entities or business activities within
the Group to express an opinion on the consolidated financial statements, of which we are the independent auditors. We are
responsible for the direction, supervision and performance of the audit of financial information of such entities.
We believe that the audit evidence obtained by us is sufficient and appropriate to provide a basis for our audit opinion on the
consolidated financial statements.
We communicate with those charged with governance of the Holding Company and such other entity included in the consolidated
financial statements of which we are the independent auditors regarding, among other matters, the planned scope and timing of the
audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding
independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our
independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in the
audit of the consolidated financial statements of the current year and are therefore the key audit matters. We describe these matters in
our auditors’ report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we

187
INDEPENDENT AUDITORS’ REPORT 3M India Limited

determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably
be expected to outweigh the public interest benefits of such communication.
Report on Other Legal and Regulatory Requirements
A. As required by Section 143(3) of the Act, based on our audit, we report, to the extent applicable, that:
a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were
necessary for the purposes of our audit of the aforesaid consolidated financial statements.
b) In our opinion, proper books of account as required by law relating to preparation of the aforesaid consolidated financial
statements have been kept so far as it appears from our examination of those books.
c) The consolidated balance sheet, the consolidated statement of profit and loss (including other comprehensive income),
the consolidated statement of changes in equity and the consolidated statement of cash flows dealt with by this Report are
in agreement with the relevant books of account maintained for the purpose of preparation of the consolidated financial
statements.
d) In our opinion, the aforesaid consolidated financial statements comply with the Ind AS specified under section 133 of the
Act.
e) On the basis of the written representations received from the directors of the Holding Company as on 31 March 2019 taken
on record by the Board of Directors of the Holding Company and the reports of the statutory auditors of its Subsidiary
Company, none of the directors of the Group companies, is disqualified as on 31 March 2019 from being appointed as a
director in terms of Section 164(2) of the Act.
f) With respect to the adequacy of the internal financial controls with reference to consolidated financial statements of the
Holding Company and its subsidiary company and the operating effectiveness of such controls, refer to our separate Report
in “Annexure A”.
B. With respect to the other matters to be included in the Auditor’s Report in accordance with Rule 11 of the Companies (Audit and
Auditor’s) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:
i. The consolidated financial statements disclose the impact of pending litigations as at 31 March 2019 on the consolidated
financial position of the Group. Refer Note 35 to the consolidated financial statements;
ii. The Group did not have any material foreseeable losses on long-term contracts including derivative contracts during the
year ended 31 March 2019;
iii. There are no amounts which are required to be transferred to the Investor Education and Protection Fund by the Holding
Company or its subsidiary company, during the year ended 31 March 2019; and
iv. The disclosures in the consolidated financial statements regarding holdings as well as dealings in specified bank notes
during the period from 8 November 2016 to 30 December 2016 have not been made in the financial statements since they
do not pertain to the financial year ended 31 March 2019.
C. With respect to the matter to be included in the Auditors’ report under section 197(16):
In our opinion and according to the information and explanations given to us the remuneration paid during the current year by
the Holding Company and its subsidiary company to its directors is in accordance with the provisions of Section 197 of the Act.
The remuneration paid to/ provided for any director by the Holding Company and its subsidiary company is not in excess of the
limit laid down under Section 197 of the Act. The Ministry of Corporate Affairs has not prescribed other details under Section
197(16) which are required to be commented upon by us.
For B S R & Co. LLP
Chartered Accountants
Firm Registration No: 101248W/W-100022
Amit Somani
Place : Paris Partner
Date : May 28, 2019 Membership Number: 060154

188
ANNEXURE ‘A’ TO INDEPENDENT AUDITORS’ REPORT 3M India Limited

Annexure A to the Independent Auditors’ report on the consolidated financial statements of

3M India Limited for the year ended 31 March 2019
Report on the internal financial controls with reference to the aforesaid consolidated financial statements
under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013
(Referred to in paragraph (A)(f) under ‘Report on Other Legal and Regulatory Requirements’ section of our report of even date)

Opinion
In conjunction with our audit of the consolidated financial statements of 3M India Limited as of and for the year ended 31 March 2019, we have
audited the internal financial controls with reference to consolidated financial statements of 3M India Limited (hereinafter referred to as “the Holding
Company”) and such company incorporated in India under the Companies Act, 2013 which is its subsidiary company, as of that date.
In our opinion, the Holding Company and such company incorporated in India which is its subsidiary company, have, in all material respects, adequate
internal financial controls with reference to consolidated financial statements and such internal financial controls were operating effectively as at 31
March 2019, based on the internal financial controls with reference to financial statements criteria established by such companies considering the
essential components of such internal controls stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by
the Institute of Chartered Accountants of India (the “Guidance Note”).

Management’s Responsibility for Internal Financial Controls

The respective Company’s management and the Board of Directors are responsible for establishing and maintaining internal financial controls with
reference to financial statements based on the criteria established by the respective Company considering the essential components of internal
control stated in the Guidance Note. These responsibilities include the design, implementation and maintenance of adequate internal financial
controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to the respective company’s
policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records,
and the timely preparation of reliable financial information, as required under the Companies Act, 2013 (hereinafter referred to as “the Act”).

Auditors’ Responsibility
Our responsibility is to express an opinion on the internal financial controls with reference to consolidated financial statements based on our audit.
We conducted our audit in accordance with the Guidance Note and the Standards on Auditing, prescribed under section 143(10) of the Act, to the
extent applicable to an audit of internal financial controls with reference to consolidated financial statements. Those Standards and the Guidance Note
require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal
financial controls with reference to consolidated financial statements were established and maintained and if such controls operated effectively in all
material respects.
Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls with reference to consolidated
financial statements and their operating effectiveness. Our audit of internal financial controls with reference to consolidated financial statements
included obtaining an understanding of internal financial controls with reference to consolidated financial statements, assessing the risk that a
material weakness exists, and testing and evaluating the design and operating effectiveness of the internal controls based on the assessed risk. The
procedures selected depend on the Auditors’ judgement, including the assessment of the risks of material misstatement of the consolidated financial
statements, whether due to fraud or error.
We believe that the audit evidence we have obtained, is sufficient and appropriate to provide a basis for our audit opinion on the internal financial
controls with reference to consolidated financial statements.

Meaning of Internal Financial controls with Reference to Financial Statements

A company’s internal financial controls with reference to financial statements is a process designed to provide reasonable assurance regarding the
reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting
principles. A company’s internal financial controls with reference to financial statements includes those policies and procedures that (1) pertain to
the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;
(2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with
generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorisations
of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised
acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial controls with Reference to Financial Statements

Because of the inherent limitations of internal financial controls with reference to financial statements, including the possibility of collusion or
improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any
evaluation of the internal financial controls with reference to financial statements to future periods are subject to the risk that the internal financial
controls with reference to financial statements may become inadequate because of changes in conditions, or that the degree of compliance with the
policies or procedures may deteriorate.
For B S R & Co. LLP
Chartered Accountants
Firm Registration No: 101248W/W-100022
Amit Somani
Place : Paris Partner
Date : May 28, 2019 Membership Number: 060154

189
CONSOLIDATED BALANCE SHEET 3M India Limited
(Rs. in lakhs)
As at Note 31 March 2019 31 March 2018
I. Assets
(1) Non-current assets
(a) Property, plant and equipment 4 28,580.31 30,301.70
(b) Capital work-in-progress 4 1,238.16 591.37
(c) Intangible assets 5 25.90 41.09
(d) Financial assets
(i) Trade receivables 6 - 77.26
(ii) Loans receivable 7 975.24 1,237.69
(e) Deferred tax assets, (net) 36 3,071.79 1,887.07
(f) Income tax assets, (net) 36 6,460.97 5,234.80
(g) Other non-current assets 9 5,797.45 4,059.58
Total non-current assets 46,149.82 43,430.56
(2) Current assets
(a) Inventories 10 41,126.40 36,747.54
(b) Financial assets
(i) Trade receivables 6 58,655.97 56,808.77
(ii) Cash and cash equivalents 11 55,746.66 85,465.25
(iii) Loans receivable 7 472.67 217.06
(iv) Other financial assets 8 3,247.46 4,323.18
(c) Other current assets 9 6,433.28 3,487.26
Sub - total 165,682.44 187,049.06
Assets held for sale - 579.89
Total current assets 165,682.44 187,628.95
Total assets 211,832.26 231,059.51
II. Equity and liabilities
Equity
(a) Equity share capital 12 1,126.51 1,126.51
(b) Other equity 13 142,157.06 105,545.44
Total equity 143,283.57 106,671.95
Liabilities
(1) Non-current liabilities
(a) Financial liabilities
- Borrowings 14 760.54 523.92
(b) Provisions 15 2,890.09 2,369.11
Total non-current liabilities 3,650.63 2,893.03
(2) Current liabilities
(a) Financial liabilities
(i) Trade payables
- Total outstanding dues of micro and small enterprises 16 2,098.21 1,293.36
- Total outstanding dues of creditors other than micro and small enterprises 16 33,483.33 34,364.26
(ii) Other financial liabilities 17 16,030.26 74,293.37
(b) Other current liabilities 18 4,268.30 2,763.87
(c) Provisions 15 7,182.29 6,863.50
(d) Income tax liabilities, (net) 36 1,835.67 1,916.17
Total current liabilities 64,898.06 121,494.53
Total liabilities 68,548.69 124,387.56
Total equity and liabilities 211,832.26 231,059.51
Significant accounting policies 3
See accompanying notes to the Consolidated financial statements
As per our report of even date attached
For B S R & Co. LLP For and on behalf of the Board of Directors
Chartered Accountants
Firm registration number: 101248W/W-100022 Debarati Sen B V Shankaranarayana Rao
Amit Somani Managing Director Whole-time Director
Partner [DIN: 07521172] [DIN – 00044840]
Membership No: 060154 Mamta Gore V. Srinivasan
Place: Paris Place: Bangalore Chief Financial Officer Company Secretary
Date: May 28, 2019 Date: May 28, 2019 [PAN: AKIPG9089M] [ACS – 16430]

190
CONSOLIDATED STATEMENT OF PROFIT AND LOSS 3M India Limited
(Rs. in lakhs)
For the year ended Note 31 March 2019 31 March 2018
Continuing Operations
Income
Revenue from operations 19 301,682.24 273,418.82
Other income 20 3,683.12 4,478.82
Total income 305,365.36 277,897.64
Expenses
Cost of materials consumed 21 93,854.23 86,679.96
Excise duty - 2,436.13
Purchases of stock-in-trade 22 68,516.82 55,137.42
Changes in inventories of finished goods, stock-in-trade and work-in-progress 23 (2,353.52) (1,529.33)
Employee benefits expense 24 33,020.88 35,604.95
Finance costs 25 112.26 202.92
Depreciation and amortisation expense 4, 5 4,375.63 4,350.60
Other expenses 26 55,085.17 45,228.55
Total expenses 252,611.47 228,111.20
Profit before tax from continuing operations 52,753.89 49,786.44
Tax expense :
(i) Current tax 36 19,620.63 17,973.15
(ii) Deferred tax 36 (1,181.24) (516.81)
18,439.39 17,456.34
Profit after tax from continuing operations 34,314.50 32,330.10
Discontinued Operations: 41
Profit from discontinued operations 91.07 754.38
Gain on disposal of discontinued operations 3,171.66 905.00
Tax expense of discontinued operations 959.24 654.40
Profit after Tax from discontinued operations 2,303.49 1,004.98
Profit for the year 36,617.99 33,335.08
Other comprehensive income
Items that will not be reclassified subsequently to consolidated statement of profit or loss
Remeasurements of net defined benefit liability / asset (9.85) (31.15)
Income tax relating to items that will not be reclassified subsequently to profit or loss 3.48 10.77
Other comprehensive income, net of tax (6.37) (20.38)
Total comprehensive income for the year 36,611.62 33,314.70
Earnings per share for continuing operations (Nominal value of Rs. 10 each) 28
- Basic (in Rs.) 304.61 286.99
- Diluted (in Rs.) 304.61 286.99
Earnings per share for discontinued operations (Nominal value of Rs. 10 each) 28
- Basic (in Rs.) 20.45 8.92
- Diluted (in Rs.) 20.45 8.92
Earnings per share for total operations (Nominal value of Rs. 10 each) 28
- Basic (in Rs.) 325.06 295.91
- Diluted (in Rs.) 325.06 295.91
Weighted average number of equity shares used in computing earnings per share :
- Basic 1,12,65,070 1,12,65,070
- Diluted 1,12,65,070 1,12,65,070
Significant accounting policies 3
See accompanying notes to the Consolidated financial statements
As per our report of even date attached
For B S R & Co. LLP For and on behalf of the Board of Directors
Chartered Accountants
Firm registration number: 101248W/W-100022 Debarati Sen B V Shankaranarayana Rao
Amit Somani Managing Director Whole-time Director
Partner [DIN: 07521172] [DIN – 00044840]
Membership No: 060154 Mamta Gore V. Srinivasan
Place: Paris Place: Bangalore Chief Financial Officer Company Secretary
Date: May 28, 2019 Date: May 28, 2019 [PAN: AKIPG9089M] [ACS – 16430]

191
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY 3M India Limited

(Rs. in lakhs)

Other equity
Total equity
Other comprehensive
Surplus attributable
Equity income Total
to equity
Particulars share Remeasurement of Other
holders
capital Securities General Retained the net defined Equity
of the
premium Reserve earnings* benefit liability / Company
asset, net of tax
Balance as at 1 April 2017 1,126.51 949.90 303.98 71,310.66 (333.80) 72,230.74 73,357.25
Changes in equity for the year ended
31 March 2018
Remeasurement of the net defined
benefit liability / asset, net of tax - - - - (20.38) (20.38) (20.38)
effect
Profit for the year - - - 33,335.08 - 33,335.08 33,335.08
Balance as at 31 March 2018 1,126.51 949.90 303.98 104,645.74 (354.18) 105,545.44 106,671.95

Other equity
Total equity
Other comprehensive
Surplus attributable
Equity income Total
to equity
Particulars share Remeasurement of Other
holders
capital Securities General Retained the net defined Equity
of the
premium Reserve earnings* benefit liability / Company
asset, net of tax
Balance as at 1 April 2018 1,126.51 949.90 303.98 104,645.74 (354.18) 105,545.44 106,671.95
Changes in equity for the year ended
31 March 2019
Remeasurement of the net defined
benefit liability / asset, net of tax - - - - (6.37) (6.37) (6.37)
effect
Profit for the year - - - 36,617.99 - 36,617.99 36,617.99
Balance as at 31 March 2019 1,126.51 949.90 303.98 141,263.73 (360.55) 142,157.06 143,283.57
* During the year, the Company has acquired net assets of Rs. 9,188 lakhs, of 3M Electro & Communication India Private Limited,
resulting in an adjustment of Rs. 49,282 lakhs in consolidated retained earnings as on 1 April 2017. Refer note 42.

See accompanying notes to the Consolidated financial statements

As per our report of even date attached
For B S R & Co. LLP For and on behalf of the Board of Directors
Chartered Accountants
Firm registration number: 101248W/W-100022 Debarati Sen B V Shankaranarayana Rao
Managing Director Whole-time Director
Amit Somani [DIN: 07521172] [DIN – 00044840]
Partner
Membership No: 060154 Mamta Gore V. Srinivasan
Place: Paris Place: Bangalore Chief Financial Officer Company Secretary
Date: May 28, 2019 Date: May 28, 2019 [PAN: AKIPG9089M] [ACS – 16430]

192
CONSOLIDATED STATEMENT OF CASH FLOW 3M India Limited

(Rs. in lakhs)

For the year ended 31 March 2019 31 March 2018

Cash flow from operating activities

Profit before tax 52,753.89 49,786.44

Profit before tax discontinuing operation 3,262.73 1,659.38

Adjustments for:

Depreciation and amortisation expense 4,375.63 4,443.31

Provision for doubtful debts created 1,073.01 1,257.34

Liabilities no longer required written back, net (777.98) (534.39)

Unrealised net gain on foreign currency transactions and translation (418.94) (17.22)

(Gain) / Loss on disposal of property, plant and equipment (50.29) 6.84

Interest income (2,853.45) (3,658.62)

Gain on disposal of discontinued operations (3,171.66) (905.00)

Finance costs 112.26 202.92

54,305.20 52,241.00

Movements in working capital:

Increase / (decrease) in trade payables 891.81 (7,660.79)

Increase in provisions 822.82 331.92

Increase / (decrease) in other financial liabilities and other liabilities 1,855.39 (2,251.65)

Increase in trade receivables (2,854.97) (13,515.11)

Increase in inventories (4,378.86) (1,073.30)

Increase in loans, other financial assets, other current and non current assets (3,456.68) (3,193.53)

Cash generated from operations activities 47,184.71 24,878.54

Income tax paid (net of refund) (21,886.54) (21,259.00)

Net cash from operating activities (A) 25,298.17 3,619.54

Cash flow from investing activities

Investment in subsidiary (58,470.00) -

Purchase of property, plant and equipment and intangible assets (4,192.72) (1,871.06)

Proceeds from sale of property, plant and equipment 76.20 117.76

Interest received 3,474.27 3,321.48

Proceeds from sale of discontinued operations 3,771.00 942.05

Net cash (used in) / from investing activities (B) (55,341.25) 2,510.23

193
CONSOLIDATED STATEMENT OF CASH FLOW 3M India Limited

(Rs. in lakhs)

For the year ended 31 March 2019 31 March 2018

Cash flow from financing activities

Movement in finance lease liability 372.01 (3.10)

Interest paid (47.52) (202.92)

Net cash from / (used in) financing activities (C) 324.49 (206.02)

Net (decrease) / increase in cash and cash equivalents (A+B+C) (29,718.59) 5,923.75

Cash and cash equivalents at the beginning of the year 85,465.25 79,541.50

Cash and cash equivalents at the end of the year 55,746.66 85,465.25

Cash and cash equivalents comprise of (refer note 11):

Balances with banks:

- in current accounts 55,746.66 22,465.25

- deposits accounts (original maturity of less than three months) - 63,000.00

55,746.66 85,465.25

Debt reconciliation statement in accordance with Ind AS 7

Non Current borrowings and current maturities of long term borrowings

Opening balance 1,007.49 1,010.59

Movement in finance lease liability 372.01 (3.10)

Closing balance 1,379.50 1,007.49

Significant accounting policies (Refer Note 3)

See accompanying notes to the Consolidated financial statements

As per our report of even date attached
For B S R & Co. LLP For and on behalf of the Board of Directors
Chartered Accountants
Firm registration number: 101248W/W-100022 Debarati Sen B V Shankaranarayana Rao
Managing Director Whole-time Director
Amit Somani [DIN: 07521172] [DIN – 00044840]
Partner
Membership No: 060154 Mamta Gore V. Srinivasan
Place: Paris Place: Bangalore Chief Financial Officer Company Secretary
Date: May 28, 2019 Date: May 28, 2019 [PAN: AKIPG9089M] [ACS – 16430]

194
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3M India Limited

1. Reporting entity
3M India Limited (‘the Company’) is a subsidiary of 3M Company, USA. The Company manages its operations in five operating
segments: Industrial, Health Care, Safety and Graphics, Consumer and Energy. In India, the Company has manufacturing
facilities at Ahmedabad, Bangalore, Pune and has a R&D Center in Bangalore. 3M India’s five business segments bring together
common or related 3M technologies that enhance the development of innovative products and services and provide efficient
sharing of business resources. The Company is a public limited Company domiciled in India with its registered office situated at
Plot Nos. 48-51, Electronic City, Hosur Road, Bengaluru - 560 100 and is listed on the Bombay Stock Exchange Ltd (BSE) and the
National Stock Exchange Ltd (NSE).
Subsidiary Information:
3M Electro & Communication India Private Limited (3M E&C or ‘subsidiary’) is a wholly owned subsidiary of 3M India Limited.
3M E&C is a Private Limited Company domiciled in India with its registered office at Plot No. 95-97, Sanniyasikuppam, Udhaya
Nagar, Thirubhuvanai main road, Thirubhuvanai Post, Pondicherry - 605107. 3M E&C offers a complete range of products that
include the Cable jointing kits ranging from 1.1Kv to 132 KV, Heatshrinks, Coldshrinks, Kastex, Electrical Insulation Tapes, Busbar
tubes, DIY Electrical kits, various kinds of water filters, water softners, Hi flo filters, Wholehouse filters, Zeta +. In India, 3M E&C
has manufacturing facilities at Pune.
These consolidated financial statements comprise the Company and its subsidiary referred to collectively as “the Group”.

2. Basis of preparation and consolidation

A. Statement of compliance
These consolidated financial statements of the Group have been prepared in accordance with Indian Accounting Standards
(Ind AS) as per the Companies (Indian Accounting Standards) Rules, 2015, as amended notified under Section 133 of
Companies Act, 2013, (the ‘Act’) and other relevant provisions of the Act.
The consolidated financial statements were authorised for issue by the Group’s Board of Directors on 28 May 2019.
Details of the Group’s significant accounting policies are included in Note 3.
B. Functional & presentation currency
These consolidated financial statements are presented in Indian Rupees (Rs.), which is also the Group’s functional currency.
All amounts have been rounded-off to two decimal places to the nearest lakhs, unless otherwise indicated.
C. Basis of measurement
The consolidated financial statements have been prepared on the historical cost basis except for the following items:
Items Measurement basis
Certain financial assets and liabilities Fair value
Liabilities for cash settled shared-based payment arrangements Fair value
Net defined benefit asset / (liability) Fair value of plan assets less present value of
defined benefit obligations

D. Use of estimates and judgments

In preparing these consolidated financial statements, management has made judgments, estimates and assumptions that
affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual
results may differ from these estimates.
Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised
prospectively.
Judgments
Information about judgments made in applying accounting policies that have the most significant effects on the amounts
recognised in the consolidated financial statements is included in the following notes:
- Note 27 - leases: whether an arrangement contains a lease; and
- Note 27 - lease classification;

195
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3M India Limited

Assumptions and estimation uncertainties

Information about assumptions and estimation uncertainties that have a significant risk of resulting in a material adjustment
in the year ending 31 March 2020 is included in the following notes:
- Note 4 and 5 - useful life of property, plant and equipment and intangible assets;
- Note 6 to 8 and 39 - impairment of financial assets;
- Note 31 - measurement of defined benefit obligations: key actuarial assumptions;
- Note 35 - recognition and measurement of provisions and contingencies: key assumptions about the likelihood and
magnitude of an outflow of resources; and
- Note 36 - recognition of deferred tax assets: availability of future taxable profit against which tax losses carried forward
can be used.
E. Measurement of fair values
Certain accounting policies and disclosures of the Group require the measurement of fair values, for both financial and non
financial assets and liabilities.
The Group has an established control framework with respect to the measurement of fair values.
Fair values are categorised into different levels in a fair value hierarchy based on the inputs used in the valuation techniques
as follows:
- Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities
- Level 2: inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly
(i.e. as prices) or indirectly (i.e. derived from prices)
- Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs)
When measuring the fair value of an asset or a liability, the Group uses observable market data as far as possible. If the
inputs used to measure the fair value of an asset or a liability fall into a different levels of the fair value hierarchy, then the
fair value measurement is categorised in its entirety in the same level of the fair value hierarchy as the lowest level input
that is significant to the entire measurement.
Further information about the assumptions made in the measuring fair values is included in the following notes:
- Note 30 - share-based payment arrangements and
- Note 39 - financial instruments

3. Significant accounting policies

(a) Basis of Consolidation
The Company consolidates entities which it owns or controls. The consolidated financial statements comprise the financial
statements of the Company and its subsidiary as disclosed in Note 42. Control exists when the parent has power over the
entity, is exposed, or has rights, to variable returns from its involvement with the entity and has the ability to affect those
returns by using its power over the entity. Power is demonstrated through existing rights that give the ability to direct
relevant activities, those which significantly affect the entity’s returns. Subsidiaries are consolidated from the date control
commences until the date control ceases.
The financial statements of the Group companies are consolidated on a line-by-line basis and intragroup balances and
transactions including unrealized gain / loss from such transactions are eliminated upon consolidation. These financial
statements are prepared by applying uniform accounting policies in use at the Group.
(b) Business combination - common control transactions
Business combinations involving entities that are controlled by the Group are accounted for using the pooling of interests
method as follows:
1. The assets and liabilities of the combining entities are reflected at their carrying amounts.
2. No adjustments are made to reflect fair values, or recognize any new assets or liabilities. Adjustments are only made
to harmonize accounting policies.

196
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3M India Limited

3. The financial information in the financial statements is in respect of prior periods is restated as if the business
combination had occurred from the beginning of the preceding period in the financial statements, irrespective of the
actual date of the combination. However, where the business combination had occurred after that date, the prior
period information is re-stated only from that date.
4. The balance of the retained earnings appearing in the financial statements of the transferor is aggregated with the
corresponding balance appearing in the financial statements of the transferee or is adjusted against general reserves.
5. The identity of the reserves are preserved and the reserves of the transferor become the reserves of the transferee.
6. The difference, if any, between the amounts recorded as share capital issued plus any additional consideration in the
form of cash or other assets and the amount of share capital of the transferor is transferred to capital reserve and is
presented separately from other capital reserves.
(c) Financial Instruments
i. Recognition and initial measurement
The Group initially recognises financial assets and financial liabilities when it becomes a party to the contractual
provisions of the instrument. All financial assets and liabilities are measured at fair value on initial recognition which
are initially measured at transaction price. Transaction costs that are directly attributable to the acquisition or issue of
financial assets and financial liabilities, that are not at fair value through profit or loss, are added to the fair value on
initial recognition. Regular way purchase and sale of financial assets are accounted for at trade date.
ii. Classification and subsequent measurement
Financial assets
On initial recognition, a financial asset is classified as measured at-
Financial assets carried at amortised cost
A financial asset is subsequently measured at amortised cost if it is held within a business model whose objective is
to hold the asset in order to collect contractual cash flows and the contractual terms of the financial asset give rise on
specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.
Financial assets at fair value through other comprehensive income
A financial asset is subsequently measured at fair value through other comprehensive income if it is held within a
business model whose objective is achieved by both collecting contractual cash flows and selling financial assets and
the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of
principal and interest on the principal amount outstanding.
Financial assets at fair value through profit or loss
A financial asset which is not classified in any of the above categories are subsequently fair valued through profit or
loss.
Financial liabilities
Financial liabilities are subsequently carried at amortized cost using the effective interest method, except for
contingent consideration recognized in a business combination which is subsequently measured at fair value through
profit and loss. For trade and other payables maturing within one year from the Balance Sheet date, the carrying
amounts approximate fair value due to the short maturity of these instruments.
iii. Derecognition of financial instruments
Financial assets
The Group derecognises a financial asset when the contractual rights to the cash flows from the financial asset expire,
or it transfers the right to receive the contractual cash flows in a transaction in which substantially all of the risks
and rewards of ownership of the financial assets are transferred or in which the Group neither transfers nor retains
substantially all of the risks and rewards of ownership and does not retain control of the financial asset.
Financial liabilities
The Group derecognises a financial liability when its contractual obligations are discharged or cancelled, or expire.

197
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3M India Limited

The Group also derecognises a financial liability when its terms are modified and the cash flows under the modified
terms are substantially different. In this case, a new financial liability based on the modified terms is recognised at fair
value. The difference between the carrying amount of the financial liability extinguished and a new financial liability
with modified terms is recognised in the consolidated statement of profit and loss.
iv. Offsetting
Financial assets and financial liabilities are offset and the net amount presented in the balance sheet when, and only
when, the Group currently has a legally enforceable right to set off the amounts and it intends either to settle them on
a net basis or realise the asset and settle the liability simultaneously.
(d) Property, plant and equipment
i. Recognition and measurement
Items of property, plant and equipment, are measured at cost, which includes capitalised borrowing cost, less
accumulated depreciation and accumulated impairment losses, if any.
Cost of an item of property, plant and equipment comprises its purchase price, including import duties and non-
refundable purchase taxes, after deducting trade discounts and rebates, any directly attributable cost of bringing the
item to its working condition for its intended use and estimated costs of dismantling and removing the item and
restoring the site on which it is located.
If significant parts of an item of property, plant and equipment have different useful lives, then they are accounted for
as separate items (major components) of property, plant and equipment.
Any gain or loss on disposal of an item of property, plant and equipment is recognised in profit or loss.
ii. Subsequent expenditure
Subsequent expenditure is capitalised only if it is probable that the future economic benefits associated with the
expenditure will flow to the Group.
iii. Depreciation
Depreciation is calculated on cost of items of property, plant and equipment less their estimated residual values over
their estimated useful lives using the straight-line method, and is recognised in the consolidated statement of profit
and loss.
Leasehold improvements are amortised over the period of lease or the estimated useful life (3-10 years) whichever is
lower. Assets acquired under finance leases are depreciated over the shorter of the lease term and their useful lives
unless it is reasonably certain that the Group will obtain ownership by the end of the lease term. Freehold land is not
depreciated.
The estimated useful lives of items of property, plant and equipment for the current and comparative periods are as
follows:
Asset Useful lives
Buildings 10/ 20 and 30 years
Plant and machinery 3/ 7/ 10 and 15 years
Data processing equipment 3 years
Office equipment 5 years
Furniture and fixtures 10 years
Vehicles 5 years
Depreciation/amortisation method, useful lives and residual values are reviewed at each financial year-end and
adjusted if appropriate. Based on technical evaluation and consequent advice, the management believes that the
estimates of useful lives as given above best represent the period over which management expects to use these assets
and are different from the useful lives as prescribed under Part C of Schedule II of the Companies Act, 2013 for some
assets.
Depreciation on additions (disposals) is provided on a pro-rata basis i.e. from (upto) the date on which asset is ready
for use (disposed of).

198
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3M India Limited

(e) Intangible assets

Internally generated : Research and development
Expenditure on research activities is recognised in the consolidated statement of profit or loss as incurred.
Development expenditure is capitalised as part of the cost of the resulting intangible asset only if the expenditure can be
measured reliably, the product or process is technically and commercially feasible, future economic benefits are probable,
and the Group intends to and has sufficient resources to complete development and to use or sell the asset. Otherwise, it
is recognised in the the consolidated of statement profit or loss as incurred. Subsequent to initial recognition, the asset is
measured at cost less accumulated amortisation and any accumulated impairment losses.
Others
Other intangible assets are stated at acquisition cost. Such intangible assets are subsequently measured at cost less
accumulated amortisation and any accumulated impairment losses.
Amortisation is calculated to write off the cost of intangible assets less their estimated residual values over their estimated
useful lives using the straight-line method, and is included in depreciation and amortisation in the consolidated statement
of profit and loss. The amortisation rates used are:
Asset Useful life
Computer software 3 years
(f) Impairment
(i) Financial assets
The Group recognizes loss allowances using the expected credit loss (ECL) model for the financial assets which are not fair
valued through profit or loss. Loss allowance for trade receivables with no significant financing component is measured at
an amount equal to lifetime ECL. For all other financial assets, expected credit losses are measured at an amount equal to
the 12-month ECL, unless there has been a significant increase in credit risk from initial recognition in which case those are
measured at lifetime ECL. The amount of expected credit losses (or reversal) that is required to adjust the loss allowance
at the reporting date to the amount that is required to be recognised as an impairment gain or loss in the consolidated
statement of profit or loss.
(ii) Non -financial assets
Intangible assets and property, plant and equipment
Intangible assets and property, plant and equipment are evaluated for recoverability whenever events or changes in
circumstances indicate that their carrying amounts may not be recoverable. For the purpose of impairment testing, the
recoverable amount (i.e. the higher of the fair value less cost to sell and the value-in-use) is determined on an individual
asset basis unless the asset does not generate cash flows that are largely independent of those from other assets. In such
cases, the recoverable amount is determined for the Cash generating units (CGUs) to which the asset belongs.
If such assets are considered to be impaired, the impairment to be recognized in the consolidated statement of profit and
loss, is measured by the amount by which the carrying value of the assets exceeds the estimated recoverable amount
of the asset. An impairment loss is reversed in the consolidated statement of profit and loss if there has been a change
in the estimates used to determine the recoverable amount. The carrying amount of the asset is increased to its revised
recoverable amount, provided that this amount does not exceed the carrying amount that would have been determined
(net of any accumulated amortization or depreciation) had no impairment loss been recognized for the asset in prior years.
(g) Inventories
Inventories are valued at the lower of cost and estimated net realizable value, after providing for cost of obsolescence and
other anticipated losses, wherever considered necessary. The costs of raw materials and traded goods are ascertained on
First-In-First-Out basis, whereas manufactured work-in-progress and finished goods are ascertained on weighted average
method.
Finished goods and work-in-progress include costs of conversion and other costs incurred in bringing the inventories to their
present location and condition. Net realisable value is the estimated selling price in the ordinary course of business, less the
estimated costs of completion and the estimated costs necessary to make the sale.
The comparison of cost and net realisable value is made on an item-by-item basis.
The provision for inventory obsolescence is ascertained regularly based on estimated usage of the products.

199
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3M India Limited

(h) Foreign currency transactions

Transactions in foreign currencies are initially recorded by the Group at their functional currency spot rates at the date of
the transaction. Monetary assets and liabilities denominated in foreign currency are translated at the functional currency
spot rates of exchange at the balance sheet date. Exchange differences that arise on settlement of monetary items or
on reporting at each balance sheet date of the Group’s monetary items at the closing rates are recognised as income or
expenses in the period in which they arise. Non-monetary items which are carried at historical cost denominated in a
foreign currency are reported using the exchange rates at the date of transaction. Non-monetary items measured at fair
value in a foreign currency are translated using the exchange rates at the date when the fair value is determined.
(i) Revenue recognition
Effective April 1, 2018, the Group has applied Ind AS 115: Revenue from Contracts with Customers which establishes a
comprehensive framework for determining whether, how much and when revenue is to be recognised. Ind AS 115 replaces
erstwhile guidance on revenue recognition including Ind AS 18 Revenue. The Group has adopted Ind AS 115 using the
cumulative effect method (without the practical expedient), with the effect of initially applying this standard recognised
at the date of initial application (i.e. 1 April 2018). The adoption of the standard did not have any material impact on the
financial statements of the Group.
Revenue from sale of goods is recognised when control of the products being sold is transferred to the customer and when
there are no longer any unfulfilled obligations.
The Performance Obligations in the contracts are fulfilled at the time of dispatch, delivery or upon formal customer
acceptance depending on customer terms.
Revenue is measured at fair value of the consideration received or receivable, after deduction of any trade discounts, volume
rebates and any taxes or duties collected on behalf of the government such as goods and services tax, etc. Accumulated
experience is used to estimate the provision for such discounts and rebates. Revenue is only recognised to the extent that
it is highly probable a significant reversal will not occur.
Customers have the contractual right to return goods. An estimate is made of goods that will be returned and a liability is
recognised for this amount using a best estimate based on accumulated experience.
Income from services rendered is recognised based on agreements/arrangements with the customers as the service is
performed and there are no unfulfilled obligations.
Contract assets are recognised when there is excess of revenue earned over billings on contracts. Contract assets are
classified as unbilled receivables (only act of invoicing is pending) when there is unconditional right to receive cash, and
only passage of time is required, as per contractual terms. Other contract assets are classified as other assets. Unearned
and deferred revenue (“contract liability”) is recognised when there are billings in excess of revenues. Advances received for
services are reported as liabilities until all conditions for revenue recognition are met.
The Group has determined that the revenues as disclosed in Note 19 are disaggregated into categories that depict how the
nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors.
Interest income is recognized using the effective interest rate (EIR) method.
Dividend income on investments is recognised when the right to receive dividend is established.
(j) Employee benefits
Defined contribution plans
A defined contribution plan is a post-employment benefit plan under which an entity pays fixed contributions into a
separate entity and will have no legal or constructive obligation to pay further amounts. Obligations for contributions to
defined contribution plans are recognised as an employee benefit expense in the consolidated statement of profit or loss
in the periods during which the related services are rendered by employees.
Provident fund
Contribution towards provident fund for certain employees is made to the regulatory authorities, where the Group has no
further obligations. Such benefits are classified as Defined Contribution Schemes as the Group does not carry any further
obligations, apart from the contributions made on a monthly basis.
Superannuation
The Group makes contribution to the Superannuation Scheme for certain employees participating in the scheme, a defined
contribution scheme, administered by fund manager, based on a specified percentage of eligible employees’ salary. The
Group’s obligation to the scheme is restricted to the contributions to the scheme.

200
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3M India Limited

Defined benefit plans

Gratuity
The Group has an obligation towards gratuity, a defined benefit retirement plan covering eligible employees. The Group
has an Employees Gratuity Fund where the investments are administered by a Fund Manager. The Group accounts for the
liability of gratuity benefits payable in future based on an independent actuarial valuation (using the Projected Unit Credit
method). Actuarial losses/ gains are recognised in ‘Other Comprehensive Income’ in the year in which they arise.
Compensated absences
The Group provides for the encashment/ availment of leave with pay subject to certain rules. The employees are entitled
to accumulate leave subject to certain limits, for future encashment/ availment. The liability is provided based on the
number of days of unutilized leave at each balance sheet date on the basis of an independent actuarial valuation (using the
Projected Unit Credit method). Actuarial losses / gains are recognised in ‘Other Comprehensive Income’ in the year in which
they arise.
(k) Share-based payments
The fair value of the amount payable to employees in respect of share appreciation rights (SARs) and restricted stock units
(RSUs) which are settled in cash, is recognised as an expense with a corresponding increase in liabilities, over the period that
the employees unconditionally become entitled to the payment. The Group measures compensation expense for SARs at
their fair value determined using Black-Scholes Model and RSUs based on fair market value of shares of 3M Company, USA
on the date of the grant. Any change in the fair value of the liability are recognised in the consolidated statement of profit
and loss.
(l) Income taxes
i. Current tax
Current income tax for the current and prior periods are measured at the amount expected to be recovered from or
paid to the taxation authorities based on the taxable income for the period. The tax rates and tax laws used to compute
the current tax amount are those that are enacted or substantively enacted by the reporting date and applicable for
the period. The Group offsets current tax assets and current tax liabilities, where it has a legally enforceable right to
set off the recognized amounts and where it intends either to settle on a net basis or to realize the asset and liability
simultaneously.
ii. Deferred tax
Deferred income tax is recognized using the balance sheet approach. Deferred income tax assets and liabilities are
recognized for deductible and taxable temporary differences arising between the tax base of assets and liabilities
and their carrying amount in consolidated financial statements, except when the deferred income tax arises from the
initial recognition of goodwill or an asset or liability in a transaction that is not a business combination and affects
neither accounting nor taxable profits or loss at the time of the transaction.
Deferred income tax assets are recognized to the extent that it is probable that taxable profit will be available against
which the deductible temporary differences, and the carry forward of unused tax credits and unused tax losses can be
utilized. Deferred income tax liabilities are recognized for all taxable temporary differences.
The carrying amount of deferred income tax assets is reviewed at each reporting date and reduced to the extent that it
is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred income tax asset
to be utilized.
Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply in the period when
the asset is realized or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively
enacted at the reporting date.
The Group offsets, the current tax assets and liabilities (on a year on year basis) and deferred tax assets and liabilities,
where it has a legally enforceable right and where it intends to settle such assets and liabilities on a net basis.
(m) Borrowing costs
Borrowing costs attributable to the assets acquired on finance lease are expensed in the period in which they incur in the
consolidated statement of profit and loss.

201
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3M India Limited

(n) Provisions and contingent liabilities

i. General
Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, it
is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a
reliable estimate can be made of the amount of the obligation. When the Group expects some or all of a provision to
be reimbursed. The expense relating to a provision is presented in the consolidated statement of profit and loss net of
any reimbursement.
If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects,
when appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due to the
passage of time is recognised as a finance cost.
ii. Contingent liabilities
A disclosure for contingent liabilities is made where there is a possible obligation or a present obligation that may
probably not require an outflow of resources. When there is a possible or a present obligation where the likelihood of
outflow of resources is remote, no provision or disclosure is made.
iii. Onerous contracts
Provision for onerous contracts. i.e. contracts where the expected unavoidable cost of meeting the obligations under
the contract exceed the economic benefits expected to be received under it, are recognised when it is probable that
an outflow of resources embodying economic benefits will be required to settle a present obligation as a result of an
obligating event based on a reliable estimate of such obligation.
(o) Leases
i. Finance leases
The Group leases certain tangible assets and such leases where the Group has substantially all the risks and rewards
of ownership are classified as finance leases. Finance leases are capitalised at the inception of the lease at the lower
of the fair value of the leased asset and the present value of the minimum lease payments.
The leased assets are measured initially at an amount equal to the lower of their fair value and the present value
of minimum lease payments. Subsequent to initial recognition, the assets are accounted in accordance with the
accounting policy applicable to similar owned assets.
Each lease payment is apportioned between the finance charge and the reduction of the outstanding liability. The
outstanding liability is included in long-term borrowings and other current liabilities as appropriate. The finance charge
is charged to the consolidated statement of profit and loss over the lease period so as to produce a constant periodic
rate of interest on the remaining balance of the liability for each period.
ii. Operating leases
Leases in which a significant portion of the risks and rewards of ownership are retained by the lessor are classified as
operating leases. Payments made under operating leases are generally recognised in profit or loss on a straight-line
basis over the term of the lease unless such payments are structured to increase in line with expected general inflation
to compensate for the lessor’s expected inflationary cost increases.
(p) Segment reporting
Operating segments
Operating segments are reported in a manner consistent with the internal reporting provided to the Chief Operating Decision
Maker (CODM). The Managing Director of the Group is responsible for allocating resources and assessing performance of
the operating segments and accordingly is identified as the CODM. Refer note 33 for segment information presented.
(q) Cash and cash equivalents
Cash and cash equivalents includes cash on hand, demand deposits with banks, other short-term highly liquid investments
with original maturities of three months or less.

202
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3M India Limited

(r) Earnings per share

Basic Earnings Per Share (‘EPS’) is computed by dividing the net profit attributable to the equity shareholders by the
weighted average number of equity shares outstanding during the year.
For the purpose of calculating diluted earnings per share, the net profit/ loss for the period attributable to the equity
shareholders and the weighted average number of shares outstanding during the period is adjusted for the effects of all
dilutive potential equity shares.
(s) Cash flow statement
Cash flows are reported using indirect method, whereby net profits before tax is adjusted for the effects of transactions of
a non-cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from regular
revenue generating (operating activities), investing and financing activities of the Group are segregated.
(t) Recent Indian Accounting Standards :
(i) Ind AS 116 - Leases
The Group is required to adopt Ind AS 116 Leases from 1 April 2019. Ind AS 116 replaces existing leases guidance,
including Ind AS 17 Leases. Ind AS 116 introduces a single Balance sheet lease accounting model for lessees. A lessee
recognises a right of use asset representing its right to use the underlying asset and a lease liability representing its
obligation to make lease payments. There are recognition exemptions for short term leases and leases of low value
items.
Leases in which the Group is a lessee:
Under the new standard, the Group will be required to recognise new assets and liabilities for its operating leases. The
nature of expenses related to those leases will now change because the Group will recognise a depreciation charge for right
of use assets and interest expense on lease liabilities. Previously, the Group recognised operating lease expense over the
term of the lease, and recognised assets and liabilities only to the extent that there was a timing difference between actual
lease payments and the expense recognised. The Group is in the process of evaluating the potential impact of the adoption
of Ind AS 116 on accounting policies followed in its financial statements. The quantitative impact of adoption of Ind AS 116
on the financial statements in the period of initial application is not reasonably estimable as at present.
Transition
The Group plans to apply IND AS 116 using the modified retrospective method, with the effect of initially applying this
standard recognised at the date of initial application (i.e. 1 April 2019) in retained earnings. As a result, the Group will not
present individual line items appearing under comparative period presentation.
As per Ind AS 115 revenue has been recognised when a customer has obtained the control of the goods.
For certain contracts that permit the customer to return an item, revenue is currently recognised when a reasonable
estimate of the returns can be made, provided that all other criteria for revenue recognition are met. If a reasonable
estimate cannot be made, then revenue recognition is deferred until the return period lapses or a reasonable estimate of
returns can be made.
(ii) Ind AS 19 – Plan Amendment, Curtailment or Settlement
The amendment clarifies that when determining past service cost, or a gain or loss on settlement due to plan
amendment, curtailment or settlement, an entity shall remeasure the net defined benefit liability (asset) using the
current fair value of plan assets and current actuarial assumptions, including current market interest rates and other
current market prices, reflecting:
(a) the benefits offered under the plan and the plan assets before the plan amendment, curtailment or settlement;
and
(b) the benefits offered under the plan and the plan assets after the plan amendment, curtailment or settlement.
Further, if a plan amendment, curtailment or settlement occurs, it is mandatory that the current service cost and the net
interest for the period after the re-measurement are determined using the assumptions used for the re-measurement.
In addition, amendments have been included to clarify the effect of a plan amendment, curtailment or settlement on
the requirements regarding the asset ceiling. The Group does not expect any significant impact of this amendment on its
consolidated financial statements.

203
 4 Property, plant and equipment and capital work-in-progress (Rs. in lakhs)
Leased Assets
Data Electrical Leasehold
Freehold Plant and Furniture Office Leasehold Data Leasehold
Particulars Buildings processing installa- Vehicles improve- Total
land machinery & fixtures equipment land processing improve- Vehicles
equipment tions ments
Note (a) equipment ments
Balance at 31 March 2017 988.72 15,667.77 21,569.07 1,352.67 727.12 58.27 9.97 2.87 606.03 387.17 1,262.24 31.84 761.22 43,424.96
Balance at 1 April 2017 988.72 15,667.77 21,569.07 1,352.67 727.12 58.27 9.97 2.87 606.03 387.17 1,262.24 31.84 761.22 43,424.96
Additions - - 942.62 51.52 58.07 - - - - - 435.79 - 212.79 1,700.79
Deletion on account of
- - (819.84) (1.05) (3.91) - - - - - - - - (824.80)
discontinued operations
Disposals - (0.06) (96.47) (0.15) (3.27) - - - - - (472.06) (31.84) (256.32) (860.17)
Balance at 31 March 2018 988.72 15,667.71 21,595.38 1,402.99 778.01 58.27 9.97 2.87 606.03 387.17 1,225.97 - 717.69 43,440.78
Additions - 24.20 1,305.15 211.19 67.70 - - - - - 959.18 - 100.20 2,667.62
Disposals - - (86.31) (30.35) (13.80) - - - (8.90) - (279.87) - (200.28) (619.51)
Balance at 31 March 2019 988.72 15,691.91 22,814.22 1,583.83 831.91 58.27 9.97 2.87 597.13 387.17 1,905.28 - 617.61 45,488.89
Accumulated depreciation
Balance at 31 March 2017 - 1,350.75 5,589.35 419.94 555.55 58.27 7.47 2.41 567.76 7.82 717.52 31.84 362.13 9,670.81
Depreciation for the year - 676.44 2,778.26 215.35 133.81 - 1.24 0.45 37.38 5.04 370.85 - 192.91 4,411.73
Deletion on account of
- - (202.94) (1.05) (3.92) - - - - - - - - (207.91)
discontinued operations
Disposals - (0.01) (33.44) (0.09) (3.22) - - - - - (472.06) (31.84) (194.89) (735.55)
Balance at 31 March 2018 - 2,027.18 8,131.23 634.15 682.22 58.27 8.71 2.86 605.14 12.86 616.31 - 360.15 13,139.08

204
Depreciation for the year - 673.28 2,723.56 230.95 59.13 - 0.83 0.01 0.78 2.52 486.12 - 166.46 4,343.64
Disposals - - (67.60) (19.62) (17.71) - - - (8.90) - (279.87) - (180.44) (574.14)
Balance at 31 March 2019 - 2,700.46 10,787.19 845.48 723.64 58.27 9.54 2.87 597.02 15.38 822.56 - 346.17 16,908.58
Carrying value (net)
As at 31 March 2018 988.72 13,640.53 13,464.15 768.84 95.79 - 1.26 0.01 0.89 374.31 609.66 - 357.54 30,301.70
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

As at 31 March 2019 988.72 12,991.45 12,027.03 738.35 108.27 - 0.43 - 0.11 371.79 1,082.72 - 271.44 28,580.31
Capital work-in-progress
Balance at 31 March 2017 279.74
Additions during the year 1,039.41
Capitalised during the year 727.78
Balance at 31 March 2018 591.37
Additions during the year 2,186.42
Capitalised during the year 1,539.63
Balance at 31 March 2019 1,238.16
Note:
(a) Leasehold land represents amounts paid to Maharashtra Industrial Development Corporation (MIDC) for land including premium, paid towards fulfillment of compliance of certain conditions as
mentioned in the agreement. The Company is in the process of registration of the lease agreement. In this regard, the Company had received a demand of Rs. 181.77 Lakhs from MIDC in the financial
year 2011-12. The said demand is with respect to the differential premium for seeking change of Company’s name from Birla 3M Limited to 3M India Limited in the records of MIDC. The Company had
filed a Civil writ petition in the High Court at Mumbai (“the Court”). The Court vide an Order dated 5 February 2015 granted interim relief to the Company by inter-alia directing MIDC to effect the change
of name in its records subject to certain conditions mentioned in the order. During current financial year, the Company has paid The Standard Transfer Fee of INR 14,30,250 to MIDC duly acknowledged
by MIDC. A formal transfer order is awaited from MIDC.
3M India Limited

(b) Also refer to note 14, 17, 27(a)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3M India Limited

5 Intangible assets (Rs. in lakhs)

Particulars Computer Software
Balance at 1 April 2017 137.74
Additions 23.38

Balance at 31 March 2018 161.12

Additions 16.80
Balance at 31 March 2019 177.92

Accumulated amortisation

Balance at 31 March 2017 88.45

Amortisation for the year 31.58

Balance at 31 March 2018 120.03

Amortisation for the year 31.99

Balance at 31 March 2019 152.02

Carrying value (net)

As at 31 March 2018 41.09
As at 31 March 2019 25.90

6 Trade receivables (Rs. in lakhs)

As at 31 March 2019 31 March 2018

Considered Good
Trade receivables - secured* 699.82 976.54

Trade receivables - unsecured 59,552.92 57,396.07

Less: Provision for impairment (1,596.77) (1,486.58)

Credit impaired 3,142.99 2,341.45

Less: Provision for impairment (3,142.99) (2,341.45)

Net trade receivables 58,655.97 56,886.03

Non-current - 77.26

Current 58,655.97 56,808.77

58,655.97 56,886.03

*Secured against deposits received from customers.

Of the above, trade receivables from related parties are as below (also refer note 32):

Total trade receivables from related parties (also refer note 32) 801.92 725.37

Net trade receivables 801.92 725.37

The Group’s exposure to credit and currency risks, and loss allowances related to trade receivables are disclosed in note 39.

205
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3M India Limited

7 Loans receivable (Rs. in lakhs)

As at 31 March 2019 31 March 2018

Non - current
Unsecured, considered good
Security deposits 948.28 1,217.28
Loans to employees 26.96 20.41
Unsecured, considered doubtful
Security Deposits 67.51 67.51
Less : Provision for impairment (67.51) (67.51)
975.24 1,237.69
Current
Unsecured, considered good
Security deposits 424.20 157.49
Loans to employees 48.47 59.57
Unsecured, considered doubtful
Security Deposits 15.40 15.40
Less : Provision for impairment (15.40) (15.40)
472.67 217.06
1,447.91 1,454.75

8 Other financial assets (Rs. in lakhs)

As at 31 March 2019 31 March 2018
Current
Unsecured, considered good
Unbilled revenue 1,371.83 1,192.03
Interest accrued but not due - 620.82
Others receivables from related parties (refer note 32) 1,869.20 2,488.85
Others receivables 6.43 21.48
3,247.46 4,323.18

9 Other assets (Rs. in lakhs)

As at 31 March 2019 31 March 2018

Non current
Capital advances 796.36 28.55
Advances other than capital advances
Payments under protest*
Unsecured, considered good 5,001.09 4,031.03
Unsecured, considered doubtful 284.80 272.03
Less: Allowance for doubtful advances (284.80) (272.03)
5,797.45 4,059.58
Current
Prepayments 956.88 724.73
Advance for supply of goods 1,329.90 499.68
Balances with government authorities
Unsecured, considered good 4,146.50 2,020.49
Unsecured, considered doubtful 554.04 796.40
Less : Allowance for doubtful receivables (554.04) (554.04)
6,433.28 3,487.26
12,230.73 7,546.84
* The above payments represents deposits given to government authorities.

206
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3M India Limited

10 Inventories* (Rs. in lakhs)

As at 31 March 2019 31 March 2018

Raw materials 12,567.85 10,675.43
[Including in - transit Rs. 3,692.98 lakhs (2018: Rs. 3,748.63 lakhs)]
Packing materials 737.90 604.98
Work-in-progress 1,609.33 1,515.35
Finished goods 14,010.95 13,157.56
Stock-in-trade 12,200.37 10,794.22
[Including in - transit Rs. 4,501.00 lakhs (2018: Rs. 5,028.91 lakhs)]
41,126.40 36,747.54
* Refer note 3(g) for mode of valuation of inventories
The write down of inventories to net realisable value during the year amounted to Rs. 283.73 lakhs (31 March 2018 : Rs. 193.36
lakhs). The provision estimated by the management for obsolete stock during the year amounted to Rs. 902.72 lakhs (31 March
2018 : Rs. 822.99 lakhs). The write down, reversal and provision for obsolete stock are included in the costs of materials consumed
or changes in inventories of finished goods and work-in-progress.

11 Cash and cash equivalents (Rs. in lakhs)

As at 31 March 2019 31 March 2018

Balances with banks
- In current accounts 55,746.66 22,465.25
- Deposit accounts (original maturity of less than three months) - 63,000.00
55,746.66 85,465.25

12 Share capital (Rs. in lakhs except for number of shares)

As at 31 March 2019 31 March 2018

Authorised :
Equity shares 1,126.51 1,126.51
[1,12,65,070 equity shares of Rs. 10/- each
(31 March 2018 : 1,12,65,070 equity shares of Rs. 10/- each)]
1,126.51 1,126.51
Issued, subscribed and paid up:
Equity shares fully paid up 1,126.51 1,126.51
[1,12,65,070 equity shares of Rs. 10/- each
(31 March 2018 : 1,12,65,070 equity shares of Rs. 10/- each)]
1,126.51 1,126.51

(a) Reconciliation of shares outstanding at the beginning and at the end of the reporting year

31 March 2019 31 March 2018

Number of Amount Number of Amount
shares shares
Opening balance at the beginning of the year 1,12,65,070 1,126.51 1,12,65,070 1,126.51
Shares issued during the year - - - -
Closing balance at the end of the year 1,12,65,070 1,126.51 1,12,65,070 1,126.51

207
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3M India Limited

(b) Rights, preferences and restrictions attached to the equity shares

The Company has only one class of shares referred to as equity shares having a par value of Rs. 10 per share. Each holder of
equity shares is entitled to one vote per share held. In the event of liquidation of the Company, the holders of equity shares will
be entitled to receive any of the remaining assets of the Company, after distribution of all preferential amounts. The distribution
will be in proportion to the number of equity shares held by the shareholders.

(c) Shares held by holding Company

31 March 2019 31 March 2018

Number of Amount Number of Amount
shares shares
3M Company, USA 84,48,802 844.88 84,48,802 844.88

(d) Details of shareholders holding more than 5 % of total number of equity shares

31 March 2019 31 March 2018

Number of % holding Number of % holding
shares shares
3M Company, USA (Holding Company) 84,48,802 75% 84,48,802 75%
(e) There has been no buyback of shares, issues of shares by way of bonus shares or issue of shares pursuant to contract without
payment being received in cash for the period of five years immediately preceeding the date of the balance sheet.

13 Other equity (Rs. in lakhs)

As at 31 March 2019 31 March 2018

Securities premium reserve 949.90 949.90
General reserve 303.98 303.98
Remeasurment of defined benefit plans, net of tax effect (360.55) (354.18)
Retained earnings 141,263.73 104,645.74
142,157.06 105,545.44
Nature and purpose of other equity
(i) Securities premium reserve
Securities premium reserve is used to record the premium received on issue of shares. The reserve is utilised in accordance
with the provisions of the Act.
(ii) Retained earnings:
The cumulative gain or loss arising from the operations which is retained by the Group is recognised and accumulated
under the heading of retained earnings. At the end of the year, the profit after tax is transferred from the statement of profit
and loss to retained earnings. Also refer note 42.
(iii) Other comprehensive income:
Differences between the interest income on plan assets and the return actually achieved, and any changes in the liabilities
over the year due to changes in actuarial assumptions or experience adjustments within the plans, are recognised in ‘Other
equity’ and subsequently not reclassified to the Statement of Profit and Loss and will be reclassified to retained earnings.
14 Borrowings (Rs. in lakhs)
As at 31 March 2019 31 March 2018
Secured
Long term maturities of finance lease obligations (refer note below) 760.54 523.93
760.54 523.93
Note: Rate of interest for finance lease obligations ranges from 2.77% to 13.90% per annum. Finance lease obligations are
secured by hypothecation of assets underlying the leases. Finance lease obligations are payable on monthly / quarterly payment
of equated monthly installments beginning from the month subsequent to taking the lease. Period of maturity for the lease
obligations of vehicles is 4 years and for equipments it ranges from 2 years to 5 years. Also refer note 27(a).

208
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3M India Limited

15 Provisions (Rs. in lakhs)

As at 31 March 2019 31 March 2018

Current Non current Current Non current
Provision for employee benefits
Gratuity (refer note 31(b)) - 2,301.65 - 1,725.06
Compensated absences 63.67 497.89 64.08 484.12
Others (refer note 37)
Provision for warranty - - 12.20 69.43
Provision for asset retirement obligation - 90.55 - 90.50
Sales tax, service tax and other issues 3,516.85 - 2,483.31 -
Provision for credit notes and sales return 3,601.77 - 4,303.91 -
7,182.29 2,890.09 6,863.50 2,369.11

16 Trade payables (Rs. in lakhs)

As at 31 March 2019 31 March 2018

Total outstanding dues to micro and small enterprises (Refer note below) 2,098.21 1,293.36
Total outstanding dues to creditors other than micro and small enterprises* 33,483.33 34,364.26
35,581.54 35,657.62

Note

1. The principal amount and the interest due thereon remaining

unpaid to any supplier at the end of each accounting year:
- Principal 2,098.21 1,293.36
- Interest 39.65 23.72
2. The amount of interest paid by the Company in terms of Section
16 of the Micro, Small and Medium Enterprises Development Act,
2006 alongwith the amount of the payment made to the supplier
beyond the appointed date during the year:
- Interest - -
- Principal 13,418.75 1,300.64
3. The amount of interest due and payable for the period of delay in
making payment (which have been paid but beyond the appointed
day during the year) but without adding the interest specified under
the Micro, Small and Medium Enterprises Development Act, 2006. - -
4. The amount of interest accrued and remaining unpaid at the end
of each accounting year. 40.80 25.61
5. The amount of further interest remaining due and payable even
in the succeeding years, until such date when the interest dues
above are actually paid to the small enterprise, for the purpose of
disallowance of a deductible expenditure under section 23 of the
Micro, Small and Medium Enterprises Development Act, 2006. 131.81 91.01
Note: The above information has been determined based on vendors identified by the Company and confirmed by the vendors.
* Includes due to related party (refer note 32)
The Group’s exposure to currency and liquidity risks related to trade payables is disclosed in note 39.

209
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3M India Limited

17 Other financial liabilities (Rs. in lakhs)

As at 31 March 2019 31 March 2018
Current maturities of finance lease obligations (refer note 14) 618.96 483.57
Deposits from customers 983.17 999.76
Creditors for capital goods 40.80 134.51
Payroll related liabilities 5,349.98 6,074.30
Intercompany payables (refer note 32) 1,543.65 1,562.00
Accrued expenses 6,980.77 6,322.29
Other payables 512.93 246.94
Payable to subsidiary Company’s Shareholders (refer note 42) - 58,470.00
16,030.26 74,293.37
The Groups exposure to currency and liquidity risks related to other financial liabilities is disclosed in note 39.
18 Other current liabilities (Rs. in lakhs)
As at 31 March 2019 31 March 2018
Advance from customers 307.66 636.44
Statutory liabilities 3,939.01 2,042.45
Other Liabilities 21.63 84.98
4,268.30 2,763.87
19 Revenue from operations (Rs. in lakhs)
For the year ended 31 March 2019 31 March 2018
Sale of products
Finished goods 167,622.88 148,196.94
Traded goods 129,379.79 121,458.03
Sale of services* 4,435.59 3,670.29
Other operating revenue
Income from duty drawback 111.43 -
Scrap sales 132.55 93.56
301,682.24 273,418.82
* Sale of services includes income from contract research Rs. 2,794.01 lakhs (31 March 2018 : Rs. 2,491.51 lakhs) (refer note
29 (c)) and management support service fee of Rs. 1,672.32 lakhs (31 March 2018 : Rs. 1,178.78 lakhs).
Disaggregation of revenue from operations:
Business Segments 31 March 2019 31 March 2018
Industrial 1,17,540.64 1,10,566.28
Health Care 42,705.35 40,062.92
Safety and Graphics 71,255.90 66,091.17
Consumer 30,348.57 27,286.70
Electronics & Energy 36,751.02 27,783.80
Others 3,080.76 1,627.95
Total 3,01,682.24 2,73,418.82
Contracted Price 3,19,288.21 2,90,581.98
Less: Reduction towards volume rebates (11,732.76) (10,195.43)
Less: Reduction primarily towards sales returns (5,873.21) (6,967.73)
Revenue recognised 3,01,682.24 2,73,418.82

210
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3M India Limited

While disclosing the aggregate amount of transaction price yet to be recognised as revenue towards unsatisfied (or partially
satisfied) performance obligations, along with the broad time band for the expected time to recognize those revenues, the
Group has applied the practical expedient in Ind AS 115. Accordingly, the Group has not disclosed the aggregate transaction price
allocated to unsatisfied (or partially satisfied) performance obligations which pertain to contracts where revenue recognised
corresponds to the value transferred to customer typically involving event based contracts.
20 Other income (Rs. in lakhs)
For the year ended 31 March 2019 31 March 2018
Interest income from financial assets carried at amortised cost 2,853.45 3,658.62
Liabilities no longer required written back, net 777.98 534.39
Profit on sale of property, plant and equipment 51.69 2.07
Exchange gain on foreign currency transactions, net* - 280.29
Others - 3.45
3,683.12 4,478.82
* Includes unrealised gain amounting to Rs. Nil (31 March 2018: Rs. 17.22 lakhs)
21 Cost of materials consumed (Rs. in lakhs)
For the year ended 31 March 2019 31 March 2018
Inventory of materials at the beginning of the year 11,280.41 10,938.53
Add: Purchases 95,879.57 87,021.84
Less: Inventory of materials at the end of the year (13,305.75) (11,280.41)
93,854.23 86,679.96

22 Purchases of stock-in-trade (Rs. in lakhs)

For the year ended 31 March 2019 31 March 2018

Abrasive 7,710.81 6,683.00
Fusion bonded epoxy coating 4,319.83 2,921.37
Medical surgical and dental products 5,092.46 4,591.21
Self adhesive films 21,435.45 16,567.73
Others 29,958.27 24,374.11
68,516.82 55,137.42

23 Changes in inventories of finished goods, stock-in-trade and work-in-progress (Rs. in lakhs)

For the year ended 31 March 2019 31 March 2018

Opening inventory
- Finished goods 13,157.56 8,464.41
- Stock-in-trade 10,794.22 15,118.38
- Work-in-progress 1,515.35 1,152.92
25,467.13 24,735.71
Closing inventory
- Finished goods 14,010.95 13,157.56
- Stock-in-trade 12,200.37 10,794.22
- Work-in-progress 1,609.33 1,515.35
27,820.65 25,467.13
(Increase) in inventory (2,353.52) (731.42)
Less : Excise duty on opening stock of finished goods - (797.91)
Add : Excise duty on closing stock of finished goods - -
Increase/ (decrease) in excise duty - (797.91)
(2,353.52) (1,529.33)

211
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3M India Limited

24 Employee benefits expense (Rs. in lakhs)

For the year ended 31 March 2019 31 March 2018

Salaries, wages and bonus 28,563.52 28,410.00
Contribution to provident and other funds (refer note 31) 2,143.94 2,099.73
Share based payment expenses (refer note 30) 60.35 3,012.20
Staff welfare expenses 2,253.07 2,083.02
33,020.88 35,604.95

25 Finance costs (Rs. in lakhs)

For the year ended 31 March 2019 31 March 2018

Finance costs on finance lease obligations 44.44 73.13
Interest expense on financial liability measured at amortised cost 64.74 32.82
Interest on shortfall of advance tax - 88.12
Other interest expenses 3.08 8.85
112.26 202.92

26 Other expenses (Rs. in lakhs)

For the year ended 31 March 2019 31 March 2018
Consumption of stores and spares 854.17 666.91
Power and fuel 1,811.22 1,605.30
Water charges 35.10 32.15
Rent (refer note 27(b)) 1,986.20 1,942.30
Repairs and maintenance
- Plant and machinery 839.11 712.49
- Building 458.42 500.93
- Others 126.34 199.95
Insurance 228.56 264.11
Rates and taxes 1,399.21 468.53
Communication expenses 263.26 248.10
Travel and conveyance 3,303.75 3,166.26
Legal and professional charges (refer note (a) below) 1,053.39 1,265.70
Selling, distribution and advertisement expenses 8,679.03 7,036.39
Commission 396.01 529.85
Freight outward 6,244.53 5,687.82
Royalty (refer note 29 (a)) 5,472.36 3,448.02
Corporate management fees (refer note 29 (b)(i)) 13,180.95 10,985.60
Directors' sitting fees 9.40 0.12
Contract Services 896.79 536.05
Provision for doubtful debts (net of write back) 1,073.01 1,257.34
Exchange loss on foreign currency transactions, net* 1,580.88 -
Expenditure towards corporate social responsibility activities (refer note 34) 807.05 564.51
Loss on sale of fixed assets 1.40 8.91
Miscellaneous expenses 4,385.02 4,101.21
55,085.17 45,228.55

*Includes unrealised gain Rs. 418.94 lakhs (31 March 2018 Rs.: Nil)

212
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3M India Limited

(a) Payment to auditors #

31 March 2019 31 March 2018

As auditors:
Audit fee 109.00 75.00
Tax audit fee 11.00 9.50
In other capacity:
Reimbursement of out-of-pocket expenses 3.83 0.78
Total 123.83 85.28

#Excluding goods and service tax.

27 (a) Finance lease obligations

The Group has taken vehicles, leasehold improvements and data processing equipment under finance lease agreements.
The minimum lease rental payments under the finance leases are as under:
(Rs. in lakhs)
31 March 2019 31 March 2018
Future Present Future Present
minimum Interest value of minimum Interest value of
lease element of minimum lease element of minimum
payments MLP lease payments MLP lease
(MLP) payments (MLP) payments
Within less than one year 655.43 36.47 618.96 526.16 42.59 483.57

Between one and five years 788.90 28.36 760.54 554.32 30.40 523.92

1,444.33 64.83 1,379.50 1,080.48 72.99 1,007.49

27 (b) Operating leases

A. Leases as lessee
The Group has taken office premises, warehouse and residential premises under operating lease agreements that are
renewable on a periodic basis at the option of both the lessor and lessee. The initial tenure of the lease is generally for
eleven months to ninety six months.

i. Future minimum lease payments

At 31 March, the future minimum lease payments to be made under non-cancellable operating leases are as follows:

31 March 2019 31 March 2018

Payable in less than one year 1,385.64 1,599.86

Payable between one and five years 1,546.30 2,412.17

2,931.94 4,012.03

ii. Amounts recognised in profit or loss

31 March 2019 31 March 2018

Lease expenses – minimum lease payments 1,986.20 1,942.30
1,986.20 1,942.30

213
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3M India Limited

28 Earnings per share (Rs. in lakhs except for number of shares)

For the year ended 31 March 2019 31 March 2018

Net profit attributable to equity shareholders ( for continuing operations) 34,314.50 32,330.10

Weighted average number of equity shares outstanding during the year 1,12,65,070 1,12,65,070

Nominal value of equity shares (Rs.) 10.00 10.00

Basic earnings per share (Rs.) 304.61 286.99

Diluted earnings per share (Rs.) 304.61 286.99

For the year ended 31 March 2019 31 March 2018

Net profit attributable to equity shareholders ( for discontinued operations) 2,303.49 1,004.98
Weighted average number of equity shares outstanding during the year 1,12,65,070 1,12,65,070
Nominal value of equity shares (Rs.) 10.00 10.00
Basic earnings per share (Rs.) 20.45 8.92
Diluted earnings per share (Rs.) 20.45 8.92

For the year ended 31 March 2019 31 March 2018

Net profit attributable to equity shareholders ( for total operations) 36,617.99 33,335.08
Weighted average number of equity shares outstanding during the year 1,12,65,070 1,12,65,070
Nominal value of equity shares (Rs.) 10.00 10.00
Basic earnings per share (Rs.) 325.06 295.91
Diluted earnings per share (Rs.) 325.06 295.91

29 Inter Company agreements and arrangements

a) Intellectual property agreement – The Group has entered into Intellectual Property agreement with 3M Innovative
Properties Company and 3M Company, USA effective 1 July 2006 for the payment of license fees in the form of
royalties. Payments were waived off for a period of 3 years effective from 1 July 2006 to 30 June 2009. These
payments have been reinstated with effect from 1 July 2009. The Intellectual Property Agreement with 3M
Innovative Properties Company and 3M Company, USA has been revised effective 1 July 2013. Accordingly, the group
has incurred an expenditure of Rs. 5,472.36 lakhs for the year ended 31 March 2019 (31 March 2018: Rs. 3,448.02
lakhs).
b)(i) Support services/ corporate management fees - The Group has entered into support services agreement with 3M
Company, USA (having expertise in establishing, operating and managing international business and incurring costs
in developing, manufacturing, marketing and selling a diverse portfolio of products) with effect from 1 April 2009.
The Group is charged with comprehensive support services charges by 3M Company USA for the services received
from all the 3M group companies in the areas of Laboratory, Technical assistance and Manufacturing, Selling
and Marketing, Strategic and Managerial, Information Technology, Routine Administration and Foreign Services
Employees Expenses. This agreement supersedes the agreement entered by the Group with 3M Asia Pacific Pte
Limited dated 1 January 2003 which was terminated on 31 March 2009.
The Group has also entered into support services agreement with 3M Hong Kong Ltd with effect from 1 January
2011. The Group is charged with comprehensive support services charges by 3M Hong Kong Ltd for the services
rendered in the area of Laboratory, Technical assistance and manufacturing, Selling and marketing and strategic and
managerial. This agreement is in addition to the agreement already entered by the Group with 3M Company USA
dated 1 April 2009.

214
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3M India Limited

The Group has incurred the following expenditure:

(Rs. in lakhs)
31 March 2019 31 March 2018
- Laboratory and technical assistance manufacturing services 1,214.51 1,025.04

- Selling and marketing services 5,954.84 5,376.09

- Information technology services 3,045.78 2,863.60

- Other managerial services 2,965.82 1,720.87

13,180.95 10,985.60

- Foreign services employees expense are included in employee costs amounting to 919.81 438.55

The Group has accrued an amount of Rs. 3,574.97 lakhs (31 March 2018 : Rs. 3,070.69 lakhs) in respect of estimated
liability for the above services during period 1 January 2019 to 31 March 2019, the actual liability would be ascertained by
December 2019.
(ii) The support service agreement enables the Group to recharge expenses relating to Foreign Service Employees (FSEs)
of 3M Company and its affiliates. Accordingly the Group has charged Rs. 1,442.94 lakhs (31 March 2018 : Rs. 1,476.51
lakhs).
c) Contract research agreement – The Group has entered into contract research agreement with 3M Innovative
Properties Company and 3M Company, USA effective 1 July 2006 for carrying out contract research activities. During
the year, Group has recognized an income of Rs. 2,794.01 lakhs (31 March 2018 : Rs. 2,491.51 lakhs).

30 Employee stock option plan

A. Description of share based payment arrangements

i) Share purchase plan (equity-settled)

3M Company, USA, the parent Company has offered ‘General Employees Stock Purchase Plan’ to all the employees of the Group,
under which the employees of the Group are eligible to purchase the shares of 3M Company, USA at 85% of the market price
of the share. Under the plan, the Group deducts the amount from the monthly salary of the employees and remits the amount
to 3M Company, USA. In accordance with the plan, the Group during the year has deducted for remittance a sum of Rs. 351.03
lakhs (2018: Rs. 290.30 lakhs) and cumulatively amounting to Rs. 1,428.20 lakhs (2018: Rs. 1,077.17 lakhs) from the salary of the
employees who have opted for the plan. As of the year end a sum of Rs. 43.25 lakhs (2018: Rs. 33.38 lakhs) is pending remittance
to the holding Company and the same is included under ‘Other financial liabilities’ (refer note 17).

ii) Stock appreciation rights and Restricted stock units (cash-settled)

3M Company, USA has established 3M Company Long Term Incentive Plan (LTIP). As a part of the plan, Executive Directors
and Senior Executives of the Group are eligible to acquire shares of 3M Company, USA via stock options, stock appreciation
rights (SARs), restricted stock units (RSUs) and performance shares. The eligible employees are granted stock options / stock
appreciation rights (SARs) / restricted stock units (RSUs) which will vest with the employees over a period of 3 years from the date
of the grant and they can exercise the stock option within a stipulated period mentioned in the plan. Exercise price of SARs and
RSUs will be Nil. As of the year end a sum of Rs. 3,713.62 lakhs (2018: Rs. 4,570.16 lakhs) is liability and the same is included under
‘Other financial liabilities’ (refer note 17).

B. Measurement of fair values

The Group measures compensation expense for stock appreciation rights (SARs) at their fair value determined using Black -
Scholes Model and restricted stock units (RSUs) based on fair market value of shares of 3M Company, USA on the date of the
grant.

215
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3M India Limited

The fair value of the cash settled SARs and the inputs used in the measurement of fair value at grant date and measurement date
of the SARs are as follows:

31 March 2019 31 March 2018

Fair value (in $) 38.93 36.23
Share price (in $) 201.12 233.63
Expected volatility (%) 20.35% 21.04%
Expected life (years) 6.55 years 6.54 years
Expected dividends (%) 2.50% 2.44%
Risk free interest rate (%) 2.58% 2.66%

The expected term of the SARs is estimated based on the vesting term and contractual term of the SARs, as well as expected
exercise behaviour of the employee who receives the SAR. Expected volatility during the expected term is based on historical
volatility of the observed market prices of the 3M Company USA’s publicly traded equity shares particularly over the historical
period commensurate with the expected term.

C. Reconciliation of outstanding share options

The activity in the cash-settled share based payment transactions during the year ended 31 March 2019 is set out below:

31 March 2019 31 March 2018

Shares arising Weighted Shares arising Weighted
out of average exercise out of average exercise
options price (Rs.) options price (Rs.)
Stock appreciation right
Outstanding at the beginning 78,558 - 85,499 -
Granted 9,967 - 9,824 -
Forfeited and expired - - - -
Exercised 11,818 - 16,765 -
Outstanding at the end 76,707 - 78,558 -
Exercisable at the end 61,980 62,010
Restricted stock unit
Outstanding at the beginning 8,141 - 10,027 -
Granted 2,578 - 1,991 -
Forfeited and expired 304 - - -
Exercised 3,937 - 3,877 -
Outstanding at the end 6,478 - 8,141 -
Exercisable at the end 3,738 5,248

D. Expense recognised in Statement of profit and loss

An amount of Rs. 60.35 lakhs (31 March 2018: Rs. 3,012.20 lakhs) has been debited to the consolidated statement of profit and
loss for the year and included under Employee benefits expense.
E. The weighted average share price at the date of exercise with regards to SARs and RSUs exercised during the year is USD 203.96
and USD 199.22 respectively.
The above disclosures have been made to the extent information is available with the Group.

216
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3M India Limited

31 Employee benefits
(a) Defined contribution plan
The Group offers its employees defined contribution plans in the form of Provident Fund (PF), Superannuation Fund (SF),
Employees’ State Insurance (ESI). Contribution to SF is made to 3M India Limited Employees Superannuation Fund Trust and
3M E&C Employees India Superannuation Fund Trust. Other contributions are made to the Government’s funds. While both
the employees and the Group pay predetermined contributions into the Provident Fund and the ESI Scheme, contributions
into superannuation fund are made only by the Group. The contributions are normally based on a certain proportion of the
employee’s salary.
During the year, the Group has recognised the following amounts in the consolidated statement of profit and loss, which are
included in contribution to provident and other funds:
(Rs. in lakhs)
Benefits (contribution to) 31 March 2019 31 March 2018
Provident fund 1,431.78 1,414.65
Superannuation fund 144.66 133.44
Employee State Insurance Corporation 0.70 5.63
1,577.14 1,553.72

(b) Defined benefit plan

The Group provides for gratuity, a defined benefit plan (the Gratuity Plan), to its employees. The Gratuity Plan provides a
lump sum payment to vested employees, at retirement or termination of employment, of an amount based on the respective
employee’s last drawn salary and years of employment with the Company. The Group contributes all ascertained liabilities
towards gratuity to the 3M India Limited Employees Gratuity Fund Trust and 3M E&C Employees Gratuity Fund Trust. Trustees
administer contributions made to the trust. As of 31 March 2019 and 31 March 2018, the plan assets have been primarily invested
in insurer managed funds.
(Rs. in lakhs)
A. Reconciliation of opening and closing balances of the present value of the 31 March 2019 31 March 2018
defined benefit obligation
Obligation at the beginning of the year 4,283.69 3,881.86
Current service cost 435.69 414.28
Interest cost 314.67 272.26
Actuarial loss / (gains) - experience (38.00) 239.66
Actuarial loss / (gains) - financial assumptions - (161.04)
Benefits paid (302.87) (363.33)
Obligation at the end of the year 4,693.18 4,283.69

B. Reconciliation of opening and closing balances of the fair value of plan assets 31 March 2019 31 March 2018
Plan assets at the beginning of the year 2,558.63 2,051.87
Interest income on plan assets 183.56 140.53
Contribution by the Company 0.06 682.09
Remeasurements- Return on plan assets excluding amounts included in interest income (47.85) 47.47
Benefits paid (302.87) (363.33)
Plan assets at the end of the year 2,391.53 2,558.63

C. Reconciliation of present value of defined benefit obligation and the fair value of 31 March 2019 31 March 2018
plan assets to the assets and liabilities recognized in the Balance Sheet
Present value of obligation at the end of the year 4,693.18 4,283.69
Fair value of plan assets at the end of the year (2,391.53) (2,558.63)
Liability / (net asset) recognised in balance sheet 2,301.65 1,725.06

217
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3M India Limited

(Rs. in lakhs)
D. Expenses recognized in the Statement of profit and loss 31 March 2019 31 March 2018
Current service cost 435.69 414.28
Interest cost 314.67 272.26
Interest income on plan assets (183.56) (140.53)
566.80 546.01

E. Remeasurements recognized in Other comprehensive income 31 March 2019 31 March 2018

Actuarial losses / (gains) on defined benefit obligation (38.00) 78.62
Actuarial losses / (gains) on plan assets 47.85 (47.47)
9.85 31.15

F. Investment details of plan assets 31 March 2019 31 March 2018

Government securities 0.00% 0.00%
High quality corporate bonds (including public sector bonds) 0.00% 0.00%
Equity shares of listed companies 0.00% 0.00%
Property 0.00% 0.00%
Cash (including Special deposits) 3.15% 3.88%
Fund balance with Insurance companies 96.85% 96.12%
100.00% 100.00%

G. Assumptions 31 March 2019 31 March 2018

Discount rate (per annum) 7.60% 7.60%
Rate of escalation in salary (per annum) 6.00% 6.00%
Retirement age (in years) 60 years 60 years
Mortality rates Indian Assured Indian Assured
Lives Mortality Lives Mortality
(2006-08) (2006-08)
(modified) Ult. (modified) Ult.
Withdrawal rates
Under 30 years 15.00% 15.00%
31-34 years 10.00% 10.00%
35-44 years 5.00% 5.00%
45-50 years 3.00% 3.00%
51-54 years 2.00% 2.00%
55-60 years 1.00% 1.00%

H. Sensitivity analysis 31 March 2019 31 March 2018

The sensitivity analysis of significant actuarial assumptions as of end of reporting
period is shown below.
A. Discount rate
Effect on defined benefit obligation due to 1% increase in discount rate (386.65) (364.01)
Effect on defined benefit obligation due to 1% decrease in discount rate 446.70 421.28
B. Salary escalation rate
Effect on defined benefit obligation due to 1% increase in Salary escalation rate 449.66 424.08
Effect on defined benefit obligation due to 1% decrease in Salary escalation rate (395.75) (372.57)

218
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3M India Limited

(Rs. in lakhs)
I. Maturity profile of defined benefit obligation Amounts
1. March 31, 2020 261.26
2. March 31, 2021 409.91
3. March 31, 2022 440.94
4. March 31, 2023 508.25
5. March 31, 2024 301.28
6. March 31, 2025 to March 31, 2029 3,615.24

Notes :
1. The discount rate is based on the prevailing market yield on Government securities as at the balance sheet date for the estimated
term of obligations.
2. The estimates of future increase in compensation levels, considered in the actuarial valuation, have been taken on account of
inflation, seniority, promotion and other relevant factors such as supply and demand in the employment market.
3. As per the best estimate of the management, contribution of Rs. Nil (31 March 2018 : Rs. Nil) is expected to be paid to the plans
during the year ending 31 March 2020.

32 Related party transaction

Names of related parties and nature of relationship:

i) Holding company 3M Company, USA

ii) Wholly owned subsidiary 3M Electro & Communication India Private Limited (w.e.f. 27 December 2018)
iii) Fellow subsidiaries (with 3M China Limited 3M Belgium S.A./N.V.
whom transactions
3M Thailand Limited 3M Mexico, S.A. de C.V.
have occurred during
the year) 3M France S.A.S. 3M Singapore Pte. Ltd.
3M Gulf Limited Sumitomo 3M Limited
3M APAC RDC Pte Limited 3M Film Construction(Shanghai) Co Limited
3M Argentina S.A.C.I.F.I.A. 3M Taiwan Limited
3M Australia Pty. Limited 3M Technologies (S) Pte Ltd
3M Canada Company 3M Philippines, Inc.
3M Do Brasil Limitada 3M Pakistan Private Limited
3M EMEA, GmbH 3M Cogent Systems (Shenzhen) Inc.
3M Espana, S.A. 3M International Trading (Shanghai) Co., Ltd.
3M Hong Kong Limited 3M Panama S.A
3M Innovation Singapore Pte Limited 3M Speciality Materials (Shanghai) Co. Ltd.
3M Italia S.P.A. 3M Traffic Manufacturing (Shanghai) Co. Ltd.
3M Malaysia Sdn. Bhn. 3M Vietnam Limited
3M International Group B.V. 3M Hellas Limited
3M Svenska AB 3M Kenya Ltd.
3M Sanayi AS Ticaret 3M Germany Hilden GmbH

219
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3M India Limited

3M Korea Limited 3M Innovation (Thailand) Co. Ltd.

3M Korea Health & Safety Ltd 3M UK Holdings Limited
3M Korea High Tech, Korea 3M Wendt GmbH
3M United Kingdom PLC 3M Winterthur Technologies AG
3M ESPE Dental AG 3M Touch System Singapore PTE
EMFI SAS 3M South Africa (Pty) Ltd
Dyneon GmbH 3M Afrique Francophone
3M Unitek Corporation 3M Panama Pacifico S Der L.
3M Material Tech(Guangzhou) Co., Limited 3M Peru S.A
3M Wroclaw SP. Z O.O. 3M Technologies (S) Private Limited
3M Sweden Cuno Inc (USA)
Wendt Boart S.A Cuno K.K (Japan)
3M Saudi Arabia Cuno Pacific Pty Ltd Australia
3M Chile Cuno Shanghai Co Ltd (China )
3M Cn Shenzhen China Cuno 3M Germany
3M Colombia S.A Cuno 3M Poland
3M South Asia Manufacturing Company Private Limited Cuno 3M Trading Shanghai China
3M Telecommunications, France Dyneon B.V.
3M Lanka Private Limited Cuno Europe (France)
iv) Post employment 3M India Limited Employees Gratuity Fund 3M India Limited Employees Superannuation
benefit plan entities Trust Fund Trust
3M E&C Employees Gratuity Fund Trust 3M E&C Employees Superannuation Fund
Trust

v) Key management personnel Executive Directors

Debarati Sen (Managing Director)
B V Shankaranarayana Rao (Whole- time Director)
Non-executive Directors
Amit Laroya
Bharat D. Shah
Biren Gabhawala
Radhika Rajan
Albert C. Wang (Resigned effective 21 August 2018)
Sadhana Kaul (Appointed effective 31 October 2018)
Ramesh Ramadurai
Manuel B. Pardo (Resigned effective 26 May 2017)
Jongho Lee (Appointed effective 26 May 2017)
Others
Mamta Gore (Appointed effective 01 March 2018 as Chief Financial Officer)
Panagiotis Goulakos (Resigned effective 31 December 2017 as Chief Financial Officer)
V. Srinivasan (Company Secretary)

220
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3M India Limited

The details of the amounts due to or due from related parties are as follows: (Rs. in lakhs)

Name of related party 31 March 2019 31 March 2018

Trade payables
3M Company, USA 8,132.67 7,711.60
3M APAC RDC Pte Limited 2,156.56 1,969.61
3M Australia Pty. Limited - 0.31
3M Canada Company 773.75 339.86
3M China Limited 1,070.63 1,247.03
3M Do Brazil Limitada 296.36 328.90
3M EMEA, GmbH 2,188.65 3,054.86
3M France S.A.S. - 365.82
3M Germany Hilden GmbH - 2.93
3M Gulf Limited - 21.10
3M Hong Kong Limited 2.96 32.07
3M Hellas Limited - 151.59
3M Innovation Singapore Pte Limited 7,193.40 6,152.10
3M Singapore Pte Ltd. 27.58 -
3M International Trading (Shanghai) Co. Ltd. 16.97 -
3M Italia S.P.A. - 44.22
3M Korea 598.00 856.78
3M Korea Health & Safety Ltd - 118.92
3M Korea High Tech Ltd, Korea 331.10 217.16
3M Material Tech(Guangzhou) Co., Limited 89.55 15.64
3M Panama Pacifico S Der L 49.03 -
3M Panama S.A - 11.23
3M Philippines, Inc. - 3.12
3M Speciality Materials (Shanghai) Co. Ltd. 275.52 -
3M Taiwan Limited 19.38 21.47
3M Thailand Limited 47.63 7.14
3M United Kingdom Plc - 2.48
3M Unitek Corporation 20.51 72.77
3M Wroclaw Sp. Z O.O. - 9.27
Dyneon GmbH - 14.53
Dyneon B.V. 16.27 -
Emfi Sas 314.10 -
3M Poland Sp. Z O.O - 1.94
3M South Africa Limited 0.31 0.05
Sumitomo 3M Limited 1,980.60 2,377.09
Cuno Filtration France - 0.28
Cuno Pacific Pty Ltd Australia 32.32 2.40
P.T. 3M Indonesia - 0.02
25,633.85 25,154.28
Other financial liabilities
3M Company, USA 1,457.52 1,461.23
3M Singapore Pte. Ltd. 86.13 100.77
1,543.65 1,562.00

221
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3M India Limited

(Rs. in lakhs)
Name of related party 31 March 2019 31 March 2018
Trade receivables
3M Company, USA 14.62 95.33
3M Australia Pty Limited 1.00 -
3M China Limited - 0.83
3M EMEA, GmbH 96.78 140.21
3M Gulf Limited 20.07 13.19
3M Hong Kong Limited 15.52 8.29
3M Italia S.P.A. - 43.98
3M Korea Limited - 51.68
3M Lanka Private Limited 44.06 68.58
3M Malaysia Sdn. Bhn. 1.35 -
3M Pakistan Private Limited - 27.28
3M Philippines, Inc. 0.04 9.31
3M Singapore PTE Ltd 6.04 5.46
3M Speciality Materials (Shanghai) Co. Ltd. 7.73 7.73
3M Sanayi As Ticaret - 20.42
3M Taiwan Limited 6.14 0.30
3M Thailand Limited 106.70 76.43
3M Vietnam Limited 37.64 38.65
3M Saudi Arabia 365.20 -
3M Afrique Francophone - 37.21
3M Telecommunications, France 0.29 0.73
3M Chile 19.91 4.92
3M Hellas Limited - 58.11
3M United Kingdom Plc 1.75 6.95
P.T. 3M Indonesia 52.16 6.74
3M Peru S.A 0.50 -
Sumitomo 3M Limited 4.42 3.04
801.92 725.37
Other financial assets
3M Company, USA 203.85 -
3M China Limited 553.41 516.42
3M Kenya Ltd. - 12.20
3M Korea Limited 462.19 492.34
3M Innovation Singapore Pte Ltd - 78.31
3M Thailand Limited 35.98 26.53
3M Lanka Private Limited - 159.74
P.T. 3M Indonesia 213.67 292.64
3M Speciality Materials (Shanghai) Co. Ltd. - 22.94
3M United Kingdom Plc - 9.39
3M France S.A.S. - 96.68
3M Belgium S.A/N.V - 18.82
3M Argentina S.A.C.I.F.I.A. - 710.85

222
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3M India Limited

(Rs. in lakhs)
Name of related party 31 March 2019 31 March 2018
3M Cogent Systems (Shenzhen) Inc. - 10.65
3M CN Shenzhen - 3.78
Cuno Shanghai Co Ltd (China ) - 0.96
3M APAC RDC Pte Limited - 0.04
3M International Trading (Shanghai) Co. Ltd. 345.25 31.34
3M Technologies (S) Private Limited - 0.13
3M Telecommunications, France - 1.86
3M Malaysia Sdn. Bhn. 27.37 -
3M South Asia Manufacturing Company Private Limited 17.48 -
3M Traffic Manufacturing (Shanghai) Co. Ltd. - 3.23
Lala Das Chandrashekar 10.00 -
1,869.20 2,488.85
Details of the related party transactions entered into by the Company are as follows:

Name of related party 31 March 2019 31 March 2018

Remuneration paid to Key management personnel #
Debarati Sen 567.70 474.96
B V Shankaranarayana Rao 224.44 183.53
Mamta Gore 364.62 15.33
Panagiotis Goulakos - 179.74
V. Srinivasan 46.17 43.42
1,202.93 896.98
# Excludes contributions to employee retirement / post retirement and other employee benefits which are based on actuarial
valuation done on an overall Company basis
Sitting fees and commission paid to Key management personnel

Name of related party 31 March 2019 31 March 2018

Bharat D. Shah 18.60 18.40
Biren Gabhawala 18.20 18.00
Radhika Rajan 17.60 17.00
54.40 53.40
(Rs. in lakhs)
Name of related party 31 March 2019 31 March 2018
Sales of Products (net of returns)
3M Company, USA 220.49 333.03
3M Gulf Limited 120.59 119.47
3M Thailand Limited 448.02 304.66
3M Malaysia Sdn Bhd 4.59 328.83
3M Korea Limited 39.92 71.41
P.T. 3M Indonesia 144.46 50.13
3M Hellas Limited 90.74 112.28
3M Italia S.P.A - 137.49
3M EMEA, GmbH 416.92 355.96

223
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3M India Limited

(Rs. in lakhs)
Name of related party 31 March 2019 31 March 2018
3M Pakistan Private Limited 35.55 61.83
3M Lanka Private Limited 63.04 45.77
3M China Limited 18.79 30.41
3M Hong Kong Limited 54.26 12.88
3M Taiwan Limited 6.18 0.30
3M Philippines, Inc 0.04 25.56
3M Australia Pty. Limited 2.02 10.55
3M Vietnam Limited 164.93 139.25
3M Sanay AS Ticaret - 20.52
3M Singapore Pte. Ltd. 7.82 10.53
3M Mexico, S.A. de C.V. - 1.74
Sumitomo 3M Limited 75.07 8.12
3M Saudi Arabia 1,020.79 39.06
3M Afrique Francophone - 61.77
3M Chile S.A 71.75 46.24
3M Argentina S.A.C.I.F.I.A - 1.53
3M Peru S.A 0.50 19.58
3M United Kingdom Plc - 6.93
3M Colombia S.A - 25.94
3M Telecommunications, France - 0.26
3M Russia - 0.20
3M South Africa (Pty) Ltd - 0.19
3M Asia Pacific Pte. Ltd. 0.38 -
3M Do Brasil Limitada 61.33 -
3,068.18 2,382.42
Contributions during the year
3M India Ltd Employees Gratuity Fund Trust 0.06 500.06
3M India Ltd Employees Superannuation Fund Trust 129.63 116.17
3M E&C Employees Gratuity Fund Trust - 182.03
3M E&C Employees Superannuation Fund Trust 14.73 17.27
144.42 815.53
Investment in subsidiary company
3M International Group B.V. 28,650.30 -
3M Company, USA 29,819.70 -
58,470.00 -
Income from contract research
3M Company, USA 2,794.01 2,491.51
2,794.01 2,491.51

224
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3M India Limited
(Rs. in lakhs)
Name of related party 31 March 2019 31 March 2018
Income from management support services
3M Company, USA 1,584.91 1,048.57
3M South Asia Manufacturing Company Private Limited 87.41 -
3M Lanka Private Limited - 130.21
1,672.32 1,178.78
Reimbursement of expenses received
3M Company, USA 2,060.64 1,096.11
P.T. 3M Indonesia 419.37 390.72
3M Korea Limited 444.97 476.11
3M Singapore PTE Ltd 145.82 165.38
3M Flim Contrcution(Shanghai) Co Limited - 390.68
3M Thailand Limited 37.04 23.22
3M Kenya Ltd. - 12.07
3M Malaysia SDN. BHD 66.42 -
3M China Limited 329.32 -
3,503.58 2,554.29
Sale of capital goods
3M Svenska AB - 4.73
- 4.73
Purchase of materials (net of returns)
3M Company, USA 35,093.06 31,201.92
3M APAC RDC Pte Limited 6,964.22 6,765.76
3M Belgium S.A./N.V. 7.71 10.85
3M Canada Company 993.51 405.56
3M China Limited 1,976.66 1,000.66
3M CN Shenzhen, China - 144.81
3M Cogent Systems (Shenzhen) Inc. - 242.58
3M Do Brasil Limitada 704.08 422.91
3M EMEA, GmbH 2,663.06 3,336.51
3M Espana, S.A. 777.60 105.10
3M ESPE Dental AG 173.33 601.26
3M France S.A.S. 909.31 806.64
3M Germany Hilden GmbH 2,562.77 -
3M Hong Kong Limited 13.20 8.71
3M Innovation (Thailand) Co. Ltd. 2.68 0.76
3M Innovation Singapore Pte Limited 23,884.24 15,792.74
3M Italia S.P.A. 520.08 55.04
3M Korea Health & Safety Ltd 0.91 577.09
3M Korea Limited 1,483.72 2,114.14

225
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3M India Limited

(Rs. in lakhs)
Name of related party 31 March 2019 31 March 2018
3M Malaysia Sdn. Bhn. 6.40 -
3M Material Tech(Guangzhou) Co., Limited 170.47 134.16
3M Panama S.A 123.32 97.53
3M Philippines, Inc. - 3.38
3M Speciality Materials (Shanghai) Co. Ltd. 526.14 357.43
3M Taiwan Limited 92.87 55.66
3M Thailand Limited 162.43 209.32
3M UK Holdings Limited 896.03 1,539.64
3M United Kingdom PLC 132.66 12.14
3M Unitek Corporation 68.88 230.49
3M Wendt GmbH 47.03 131.00
3M Winterthur Technologies AG 1,014.90 336.07
3M Wroclaw SP. Z O.O. 484.59 203.30
Dyneon B.V. - 23.05
Dyneon GmbH 1,349.36 1,395.48
3M International Trading (Shanghai) Co., Ltd 33.30 108.98
3M Korea High Tech, Korea 437.93 550.34
3M Singapore Pte. Ltd. 296.60 1.30
3M Technologies (S) Pte Ltd - 25.46
3M Touch System Singapore PTE 1.96 4.08
Wendt Boart S.A - 0.34
3M Sweden 42.54 553.97
Cuno 3M Germany 197.25 287.91
Cuno 3M Poland 106.28 54.90
Cuno 3M Trading Shanghai China - 328.07
Cuno Europe (France ) 10.39 22.68
Cuno Inc (USA) 1,746.10 773.21
Cuno K.K (Japan) 11.83 11.04
3M Peru S.A 63.41 -
3M Mexico, SA d e c v - 2.33
3M South Africa (Pty) Limited 0.13 10.17
3M Telecommunications, France 2.42 -
P.T. 3M Indonesia - 10.29
Sumitomo 3M Limited 7,764.72 7,414.27
Cuno Pacific Pty Ltd Australia 115.35 31.92
94,635.43 78,512.95
Corporate management fees (excluding ineligible portion of Goods and Service tax)
3M Company, USA 13,180.95 10,777.46
3M Hong Kong Limited - 32.07
13,180.95 10,809.53

226
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3M India Limited

(Rs. in lakhs)
Name of related party 31 March 2019 31 March 2018
Royalty (excluding ineligible portion of Goods and Service tax)
3M Company, USA 5,472.36 3,390.35
5,472.36 3,390.35
Recharges of expenses paid
3M Company, USA 684.79 339.37
3M Hellas Limited - 99.18
3M Lanka Private Limited 30.74 -
3M Gulf Limited 235.02 -
950.55 438.55

33 Segment Reporting
A. Basis for segmentation
Ind AS 108 establishes standards for the way that public business enterprises report information about operating segments and
related disclosures about products and services, geographic areas, and major customers. Based on the “management approach”
as defined in Ind AS 108, the Chief Operating Decision Maker (CODM) evaluates the Company’s performance and allocates
resources based on an analysis of various performance indicators by segments. The accounting principles used in the preparation
of the financial statements are consistently applied to record revenue and expenditure in individual segments, and are as set out
in the significant accounting policies.
The Group operates mainly to the needs of domestic market and export turnover is not significant in context of total turnover.
Accordingly, there are no reportable geographical segments. The Group has five reportable segments, as described below.
For each of the segments, the Company’s Managing Director reviews internal management reports on at least a quarterly basis.
Segment revenue, results, assets and liabilities figures include the respective amounts identifiable to each of the segments.
Other unallocable income net off unallocable expenditure are towards common services to the segments which are not directly
identifiable to the individual segments as well as those at a corporate level which relate to the Group as a whole.
The following summary describes the products included in each of the Group’s reportable segment:
Reportable segments Products
Industrial Major products under this segment include vinyl, polyester, foil and specialty industrial tapes and adhesives: Scotch
Masking Tape, Scotch Filament Tape and Scotch Packaging Tape, Functional and Decorative Graphics, Abrasion-
Resistant Films, Masking Tapes and Other Specialty Materials.
Health care Major products include medical and surgical supplies, medical devices, skin & wound care and infection prevention products
& solutions, drug delivery systems, dental and orthodontic products and food safety products.
Safety and Graphics Major product under this segment include personal protection products, brand & asset protection solutions, border
control products, passive fire protection products for industries and commercial establishments, track and trace
products, cleaning and hygiene products for the hospitality industry.
Graphics business consists of four divisional subsets- the Traffic Safety Systems Division (TSSD), the Commercial
Graphics Division (CGD), the Architectural Markets Division (AMD) and the Mobile Interactive Solutions Division
(MISD). TSSD products include retro reflective traffic signs for highways and cities, pavement marking and vehicle
registration products and services. CGD portfolio includes products like films, inks and digital signage products. AMD
products includes wall and glass cladding products coupled with architectural interior services and environmental
graphics for home and office spaces. MISD products include projection systems, computer and ATM-screen privacy
filters and brightness enhancement films for television, avionics and automotive displays.
Consumer Consumer and Office business includes products such as Scotch brand, addressing the Home & Office tapes,
Adhesives, Packaging protection platforms, Post-it brand with a product range of Note Pads, Dispensers, Flagging
solution, Labels and Scotchguard brand addressing the stain protection market.
Electronics & Energy Energy business includes products such as Fusion Bonded Epoxy coatings, Sun films and renewable energy. Major
products in this segment includes the Cable jointing kits ranging from 1.1Kv to 132 KV, Heatshrinks, Coldshrinks,
Kastex, Electrical Insulation Tapes, Busbar tubes, DIY Electrical kits.
B. Information about reportable segments
Information regarding the results of each reportable segment is included below. Performance is measured based on segment
profit (before tax), as included in the internal management reports that are reviewed by the CODM. Segment profit is used to

227
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3M India Limited

measure performance as management believes that such information is the most relevant in evaluating the results of certain
segments relative to other entities that operate within these industries. (Rs. in lakhs)
31March2019 31March2018
Segment revenue (revenue from operations)
a) Industrial 117,540.64 110,566.28
b) Health Care 42,705.35 40,062.92
c) Safety and Graphics 71,255.90 66,091.17
d) Consumer 30,348.57 27,286.70
e) Electronics & Energy 36,751.02 27,783.80
f) Others 3,080.76 1,627.95
Revenue from continuing operations 301,682.24 273,418.82
Revenue from discontinued Operations 782.93 4,874.51
Total revenue 302,465.17 278,293.33
Segment results
a) Industrial 20,379.73 20,163.75
b) Health Care 8,429.73 7,779.21
c) Safety and Graphics 8,808.37 8,507.45
d) Consumer 5,510.35 4,796.84
e) Electronics & Energy 5,327.43 3,818.67
f) Others 727.42 444.62
Segment results from continuing operations 49,183.03 45,510.54
Segment results from discontinuing operations 3,262.73 1,659.38
Total segment results 52,445.76 47,169.92
Less : Interest expense 112.26 202.92
Add: Other un-allocable income net off un-allocable expenditure 3,683.12 4,478.82
Profit before tax 56,016.62 51,445.82
Tax expense 19,398.63 18,110.74
Profit after tax 36,617.99 33,335.08
Segment assets
a) Industrial 51,321.06 48,113.84
b) Health Care 18,311.12 19,352.14
c) Safety and Graphics 31,370.00 30,293.45
d) Consumer 11,445.99 11,883.36
e) Electronics & Energy 15,013.57 13,037.48
f) Unallocated corporate assets 84,370.52 106,574.32
Total assets 211,832.26 229,254.59
Assets of discontinued operations - 1,804.92
Total assets 211,832.26 231,059.51
Segment liability
a) Industrial 15,465.99 15,996.89
b) Health Care 7,836.30 4,760.40
c) Safety and Graphics 4,393.71 9,704.24
d) Consumer 2,232.37 2,364.87
e) Electronics & Energy 9,226.58 5,317.08
f) Unallocated corporate liabilities 29,393.74 85,266.31
Liabilities of continuing operations 68,548.69 123,409.79
Liabilities of discontinued operations - 977.77
Total liabilities 68,548.69 124,387.56

228
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3M India Limited

(Rs. in lakhs)
31 March 2019 31 March 2018
Capital expenditure
a) Industrial 1,657.22 685.97
b) Health Care 151.62 210.06
c) Safety and Graphics 290.98 192.04
d) Consumer 448.51 233.59
e) Electronics & Energy 417.64 96.13
f) Unallocated corporate liabilities 1,226.75 454.66
Total capital expenditure 4,192.72 1,872.46
Depreciation and amortisation expenses
a) Industrial 1,654.34 1,573.01
b) Health Care 721.46 734.62
c) Safety and Graphics 468.11 486.58
d) Consumer 577.81 574.16
e) Electronics & Energy 465.54 337.90
f) Unallocated depreciation / amortisation expenses 488.37 644.33
Depreciation / amortisation expenses continued operations 4,375.63 4,350.60
Depreciation / amortisation expenses discontinued operations - 92.71
Total depreciation / amortisation expenses 4,375.63 4,443.31
Non cash expenses other than depreciation and amortisation expense
a) Industrial 425.13 84.28
b) Health Care 136.02 -
c) Safety and Graphics 353.78 -
d) Consumer 74.44 -
e) Electronics & Energy 83.64 354.38
f) Unallocated non cash expenses - 818.68
Total non cash expenses 1,073.01 1,257.34

34 Corporate social responsibility

During the year, the amount required to be spent on corporate social responsibility activities amounted to Rs. 820.49 lakhs
(31 March 2018: Rs. 603.76 lakhs) in accordance with Section 135 of the Companies Act, 2013. The following amounts were spent
during the current and previous year:
(Rs. in lakhs)

For the year ended 31 March 2019 31 March 2018

(i) Amount spent other than for construction / acquisition of any asset 807.05 564.51
(ii) Amount not spent 13.49 45.84
Total 820.54 610.35

229
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3M India Limited

35 Contingent liabilities and commitments: (Rs. in lakhs)

As at 31 March 2019 31 March 2018
a) Guarantees:
- Issued by Groups bankers 5,518.16 3,436.00
b) Claims against the Group not acknowledged as debts:
- Trade claims/ demands 74.23 94.22
- Income tax demand (including interest) (refer note (i) below) 13,436.22 9,844.54
- Custom duty demands (refer note (ii) and (iii) below) 18,348.54 18,348.54
- Sales tax matters (refer note (iv) below) 6,339.92 9,440.20
- Service tax matters (refer note (v) below) 917.01 782.15
- Central excise duty matters (refer note (vi) below) 4,203.23 2,512.82
c) Bills discounted 118.33 109.97

Notes:
(i) Income tax matters mainly relate to intercompany charges.
(ii) The Group during the year 2012-13 had received an order from The Commissioner of Customs demanding differential
duty, interest and penalty of Rs.1,961.50 lakhs, contending the availment of concessional import duty in respect of some
of its products for which a demand notice was served on the Group for payment of the above amount. The Group has
filed an appeal against the order including for obtaining a stay against any recovery proceedings that may be initiated and
accordingly no liability has been recognised in the books.
(iii) The Group was issued a Show Cause Notice dated 8th December 2016 by the Directorate of Revenue Intelligence (DRI) in
relation to levy of customs duty on inter-company transactions for import of goods and services and hence proposing to
demand differential duty of customs covering the transactions during the period 8th December 2011 to 7th February 2014.
The Group has received an order in original on 1st October 2017 from Additional Director General – DRI (Adjudication),
Mumbai confirming the demand raised for customs duty in show cause notice to the tune of Rs.7,693.52 lakhs, penalty
equivalent to the customs duty amount and additional penalty and interest of Rs.1,000 lakhs. The Group has filed an appeal
against this order with CESTAT, Mumbai after making payment of mandatory deposit of Rs.577 lakhs.
(iv) Sales tax cases primarily pertains to Maharashtra Value Added Tax Act, 2002 and Karnataka Value Added Tax Act, 2003.
These are pertaining to the years from 2005-06 to 2013-14. These cases are with respect to the applicable rate of tax for
various products and matters pertaining to declaration forms.
(v) Service tax matters relates to cases with respect to manner of apportionment of credit availed by the Group without
registering as an Input service distributor.
(vi) Excise matters relates to penalty for allegedly dealing in goods liable to confiscation under Rule 26 of the Central Excise Act
and valuation / allowability of CENVAT credit under the Central Excise Act.
(vii) The Supreme court of India in the month of February 2019 had passed a judgement relating to definition of wages under the
Provident Fund Act, 1952. However, considering that there are numerous interpretative issues relating to this judgement
and in the absence of reliable measurement of the provision for the earlier periods, the Group has made a provision for
provident fund contribution pursuant to the judgement only for the current year. The Group will evaluate its position and
update its provision, if required, on receiving further clarity on the subject. The Group does not expect any material impact
of the same.

Capital commitments 31 March 2019 31 March 2018

Estimated value of contracts in capital account remaining to be executed 1,016.19 377.84
During the year ended 31 March 2019 no material foreseeable loss (previous year: nil) was incurred for any long-term contract
including derivative contracts.

230
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3M India Limited

36 Tax expenses
(a) Amount recognised in Statement of profit and loss (Rs. in lakhs)
31 March 2019 31 March 2018
Current tax 19,620.63 17,973.15
Current period (for continuing operations) 959.24 654.40
Current period (for discontinuing operations)
Deferred tax expense / (income) related to:
Origination and reversal of temporary differences (1,181.24) (516.81)
Tax expense for the year 19,398.63 18,110.74

(b) Reconciliation of effective tax rate (Rs. in lakhs)

31 March 2019 31 March 2018
Profit before tax 56,016.62 51,445.82
Tax at statutory income tax rate 34.944% (31 March 2018 - 34.61%) 34.94% 19,574.45 34.61% 17,805.40
Tax effects of amounts which are not deductible / (taxable)
in calculating taxable income:
Non-deductible expenses 0.27% 153.15 0.85% 438.64
Effect of differential tax rates -0.65% (365.21) 0.00% (0.08)
Others 0.06% 36.24 -0.26% (133.22)
Income tax expense 34.62% 19,398.63 35.20% 18,110.74

(c) Deferred tax assets and liabilities are attributable to the following: (Rs. in lakhs)
Deferred tax assets Deferred tax liabilities Deferred tax (assets), net
Particulars
31 March 2019 31 March 2018 31 March 2019 31 March 2018 31 March 2019 31 March 2018
Property, plant and equipment 174.69 142.71 2,009.81 2,087.37 1,835.12 1,944.66
Employee benefits expense 1,109.81 998.73 - - (1,109.81) (998.73)
Statutory dues 123.17 180.36 - - (123.17) (180.36)
Provisions 3,673.93 2,652.64 - - (3,673.93) (2,652.64)
5,081.60 3,974.44 2,009.81 2,087.37 (3,071.79) (1,887.07)

(d) Movement in temporary differences

31 March 2018 (Rs. in lakhs)

Balance Recognised Recognised Recognised Balance
Particulars as at in in directly in Others as at
1 April 2017 profit or loss OCI equity 31 March 2018
Property, plant and equipment 2,079.83 (135.17) - - - 1,944.66
Employee benefits expense (971.89) (16.07) (10.77) - - (998.73)
Statutory dues (165.83) (14.53) - - - (180.36)
Provisions (2,229.33) (423.31) - - - (2,652.64)
Other items (72.27) 72.27 - - - -
(1,359.49) (516.81) (10.77) - - (1,887.07)

231
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3M India Limited

31 March 2019 (Rs. in lakhs)

Balance Recognised Recognised Recognised Balance
Particulars as at in in directly in Others as at
1 April 2018 profit or loss OCI equity 31 March 2019
Property, plant and equipment 1,944.66 (109.53) - - - 1,835.13
Employee benefits expense (998.73) (100.86) (3.48) - - (1,103.07)
Statutory dues (180.36) 50.43 - - - (129.93)
Provisions (2,652.64) (1,021.28) - - - (3,673.92)
(1,887.07) (1,181.24) (3.48) - - (3,071.79)

(e) Details of income tax assets and income tax liabilities (Rs. in lakhs)
31 March 2019 31 March 2018
Income tax assets (net) 6,460.97 5,234.80
Current tax liabilities (net) (1,835.67) (1,916.17)
Net current income tax asset/ (liability) at the end of the year 4,625.30 3,318.63

(f) The gross movement in the current income tax asset / (liability) (Rs. in lakhs)
31 March 2019 31 March 2018
Net current income tax asset / (liability) at the beginning of the year 3,318.63 687.16
Income tax paid 21,886.54 21,259.00
Current income tax expense (20,579.87) (18,627.54)
Net current income tax asset/ (liability) at the end of the year 4,625.30 3,318.63

37 Provision movement (Rs. in lakhs)

Utilisation/
Particulars 1 April 2018 Addition 31 March 2019
reversals
a) Warranty 81.63 - 81.63 -
b) Asset retirement obligation 90.50 0.05 - 90.55
c) Sales tax, service tax and other issues 2,483.31 1,262.67 229.13 3,516.85
d) Credit notes and sales return 4,303.91 3,601.77 4,303.91 3,601.77
6,959.35 4,684.49 4,614.67 7,209.17

Utilisation/
Particulars 1 April 2017 Addition 31 March 2018
reversals
a) Warranty 233.40 - 151.77 81.63
b) Asset retirement obligation 90.47 0.03 - 90.50
c) Sales tax, service tax and other issues 2,028.46 454.85 - 2,483.31
d) Credit notes and sales return 4,090.25 4,303.91 4,090.25 4,303.91
6,442.58 4,758.79 4,242.02 6,959.35

38 Capital management
The Group’s policy is to maintain a stable capital base so as to maintain investor, creditor and market confidence and to sustain
future development of the business. Management monitors capital on the basis of return on capital employed as well as the debt
to total equity ratio.
For the purpose of debt to total equity ratio, debt is debt as considered under long-term and short-term borrowings which is
on account of finance lease on office equipment and vehicles. Total equity comprise of issued share capital and all other equity
reserves.

232
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3M India Limited

The capital structure as of 31 March 2019 and 31 March 2018 was as follows: (Rs. in lakhs)
Particulars 31 March 2019 31 March 2018

Debt 1,379.50 1,007.49

Total equity 143,283.57 106,671.95

Debt to total equity ratio 0.96% 0.94%

39 Financial Instruments - Fair values and risk management

A. Accounting classification and fair values
The following table shows the carrying amounts of financial assets and financial liabilities as at 31 March 2019 (Rs. in lakhs
Carrying amount
Mandatorily FVOCI- FVOCI- Other finan- Total
Note at FVTPL - debt equity cial assets carrying
others instruments instruments - amortised amount
cost
Financial assets not measured at fair value
Trade receivables 6 - - - 58,655.97 58,655.97
Loans to employees 7 - - - 75.43 75.43
Security deposits 7 - - - 1,372.48 1,372.48
Other financial assets 8 - - - 3,247.46 3,247.46
Cash and cash equivalents 11 - - - 55,746.66 55,746.66
- - - 119,098.00 119,098.00
Financial liabilities not measured at fair value
Finance lease obligation 14, 17 - - - 1,379.50 1,379.50
Trade payables 16 - - - 35,581.54 35,581.54
Other financial liabilities 17 - - - 15,411.30 15,411.30
- - - 52,372.34 52,372.34

The fair value of financial assets and financial liabilities approximates to their carrying amount largely due to the short-term
nature of these instruments.
The following table shows the carrying amounts of financial assets and financial liabilities as at 31 March 2018 (Rs. in lakhs)
Carrying amount
Mandatorily FVOCI- FVOCI- Other Total
Note at FVTPL - debt equity financial carrying
others instruments instruments assets - amount
amortised
Financial assets not measured at fair value
Trade receivables 6 - - - 56,886.03 56,886.03
Loans to employees 7 - - - 79.98 79.98
Security deposits 7 - - - 1,374.77 1,374.77
Other financial assets 8 - - - 4,323.18 4,323.18
Cash and cash equivalents 11 - - - 85,465.25 85,465.25
- - - 148,129.21 148,129.21
Financial liabilities not measured at fair value
Finance lease obligation 14, 17 - - - 1,007.49 1,007.49
Trade payables 16 - - - 35,657.62 35,657.62
Other financial liabilities 17 - - - 73,809.80 73,809.80
- - - 110,474.91 110,474.91

233
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3M India Limited

The fair value of financial assets and financial liabilities approximates to their carrying amount largely due to the short-term
nature of these instruments.
B. Financial Risk Management
The Group has exposure to the following risk arising from financial instruments
- Credit risk
- Liquidity risk
- Market risk

i. Risk management framework

The Group’s principal financial liabilities comprise finance lease obligations, trade and other payables. The main purpose of these
financial liabilities is to finance the Group’s operations. The Group’s principal financial assets include trade and other receivables,
cash and cash equivalents that are derived directly from its operations.

ii. Credit risk

Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument fails to meet its contractual
obligations, and arises principally from the Group’s receivables from customers.
(a) Financial assets that are not credit impaired
The Group has financial assets which are in the nature of cash and cash equivalents, loans to employees, unbilled revenue
from related party, interest accrued on fixed deposits and receivables from related parties which are not credit impaired.
These are contractually agreed with either banks, related parties or employees where the probability of default is negligible.
(b) Financial assets that are credit impaired
Expected credit loss assessment for the Group as at 31 March 2018 and 2019:
The Group has divided all the debtors outstanding for the last twelve quarters into age brackets of not due, 0-90 days, 91-
180 days, 181-270 days, 271-365 days and amounts outstanding for more than one year.
The Group has calculated the impairment loss arising on account of past trends in the default rate for time bucket.
When determining whether the credit risk of a financial asset has increased significantly since initial recognition and
when estimating expected credit losses, the Group considers reasonable and supportable information that is relevant and
available without undue cost or effort. This includes both quantitative and qualitative information and analysis, based on
the Group’s historical experience and informed credit assessment and including forward looking information.
Expected credit losses are a probability-weighted estimate of credit losses. Credit losses are measured as the present value
of all cash shortfalls (i.e. the difference between the cash flows due to the Group in accordance with the contract and the
cash flows that the Group expects to receive).
Out of the total trade receivables of Rs. 63,395.73 lakhs (31 March 2018: 60,714.06 lakhs), the exposure considered
for expected credit loss is Rs. 59,372.58 lakhs (31 March 2018 :Rs. 58,736.31). The balance which is not considered for
impairment primarily pertains to intercompany receivables and secured debtors.
Trade receivables
The Credit services team has established a credit policy under which each new customer is analysed individually for
creditworthiness before the Group’s standard payment and delivery terms and conditions are offered. The Group’s review
includes external ratings, if they are available. Sale limits are established for each customer and reviewed yearly.
The Group establishes an allowance for impairment that represents its estimate of expected losses in respect of trade and other
receivables.
The maximum exposure to credit risk for trade receivables by geographic region is as follows: (Rs. in lakhs)

Carrying amount
31 March 2019 31 March 2018
India 62,593.81 59,988.67
Other regions 801.92 725.38
63,395.73 60,714.06

234
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3M India Limited

The maximum exposure to credit risk for trade receivables by type of counterparty is as follows: (Rs. in lakhs)

Carrying amount
31 March 2019 31 March 2018
Distributors 32,668.90 33,524.45
Other 30,726.83 27,189.61
63,395.73 60,714.06
Less: receivables from related party, secured receivables and other receivables not
considered for credit risk 4,023.15 1,977.75
Net trade receivables 59,372.58 58,736.31

The following table provides information about the exposure to credit risk and expected credit loss for trade and other receivables -
(Rs. in lakhs)
Gross carrying Weighted Loss
amount average loss rate allowance
31 March 2019
Current (not past due) 43,666.18 1.70% 740.40
0-90 days 11,728.12 5.55% 651.26
91-180 days 595.01 34.47% 205.11
181-270 days 815.74 70.54% 575.45
271-360 days 811.83 100.00% 811.83
> 360 days 1,755.71 100.00% 1,755.71
59,372.58 4,739.76
31 March 2018
Current (not past due) 48,187.30 1.62% 782.84
0-90 days 6,562.75 5.86% 384.39
91-180 days 1,515.51 21.07% 319.35
181-270 days 208.54 60.97% 127.14
271-360 days 874.38 94.52% 826.50
> 360 days 1,387.82 100.00% 1,387.81
58,736.31 3,828.03
Movements in the allowance for impairment in respect of trade and other receivables
The movement in the allowance for impairment in respect of trade and other receivables is as follows: (Rs. in lakhs)
31 March 2019 31 March 2018
Balance as at 1 April 3,828.03 2,570.69
Utilised during the year (161.28) -
Impairment loss recognised 1,073.01 1,257.34
Balance as at 31 March 4,739.76 3,828.03

235
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3M India Limited

iii. Liquidity risk

Liquidity risk is the risk that the Group will encounter difficulty in meeting the obligations associated with its financial liabilities
that are settled by delivering cash or another financial asset. The Group’s approach to managing liquidity is to ensure, as far as
possible, that it will have sufficient liquidity to meet its liabilities when they are due, under both normal and stressed conditions,
without incurring unacceptable losses or risking damage to the Group’s reputation.
The Group believes that the working capital is sufficient to meet its current requirements. Accordingly, no liquidity risk is perceived.
The table below provides details regarding the contractual maturities of significant financial liabilities -
(Rs. in lakhs)
Less than More than
Particulars 1-2 years 2-5 years Total
1 year 5 years
31 March 2019
Non-derivative financial liabilities
Finance lease obligations 618.96 488.51 277.03 - 1,379.50
Trade and other payables 50,992.84 - - - 50,992.84
51,611.80 488.51 272.03 - 52,372.34
31 March 2018
Non-derivative financial liabilities
Finance lease obligations 483.57 331.50 192.42 - 1,007.49
Trade and other payables 109,467.42 - - - 109,467.42
109,950.99 331.50 192.42 - 110,474.91
iv. Market risk
Market risk is the risk that changes in market prices – such as foreign exchange rates will affect the Group’s income or the value of
its holdings of financial instruments. Market risk is attributable to all market risk sensitive financial instruments including foreign
currency receivables and payables. The Group is exposed to market risk primarily related to foreign exchange rate risk. Thus, the
exposure to market risk is a function of investing and borrowing activities and revenue generating and operating activities in
foreign currency. The objective of market risk management is to avoid excessive exposure in our foreign currency revenues and
costs.
Exposure to currency risk
The summary quantitative data about the Group’s exposure to currency risk as reported to the management is as follows:
(Rs. in lakhs)
31 March 2019 31 March 2018
USD EURO SGD Others USD EURO Others

Trade and other payables 15,048.59 2,678.51 7,279.53 2,831.59 20,688.82 3,691.43 3,054.26

Trade and other receivables 2,643.64 - - - 3,182.72 - -

Net exposure in respect of recognised assets and liabilities 12,404.95 2,678.51 7,279.53 2,831.59 17,506.10 3,691.43 3,054.26

Sensitivity analysis
A reasonably possible strengthening (weakening) of the US Dollar or Euro or SGD against all other currencies as at 31 March
would have affected the measurement of financial instruments denominated in a foreign currency and affected equity and profit
or loss by the amounts shown below. This analysis assumes that all other variables, in particular interest rates, remain constant
and ignores any impact of forecast sales and purchases.

236
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3M India Limited

(Rs. in lakhs)
Profit or loss Equity, net of tax
Strengthening Weakening Strengthening Weakening
31 March 2019
USD (for 1% movement) 124.05 (124.05) 80.70 (80.70)
EURO (for 1% movement) 26.79 (26.79) 17.43 (17.43)
SGD (for 1% movement) 72.80 (72.80) 47.36 (47.36)
Others (for 1% movement) 28.32 (28.32) 18.42 (18.42)
251.96 (251.96) 163.91 (163.91)
31 March 2018
USD (for 1% movement) 175.06 (175.06) 114.47 (114.47)
EURO (for 1% movement) 36.91 (36.91) 24.14 (24.14)
Others (for 1% movement) 30.54 (30.54) 19.97 (19.97)
242.51 (242.51) 158.58 (158.58)

40 Research and development expenses (Rs. in lakhs)

For the year ended 31 March 2019 31 March 2018
Capital expenditure 170.81 235.00
Revenue expenditure 5,676.77 6,111.06
5,847.58 6,346.06

41 Discontinued Operations
During the current year the Group has sold the Communications markets division for a total consideration of 3,771.00 lakhs as a
part of the transaction the Group transferred fixed assets having a book value of 599.34 lakhs. The transaction resulted in a total
gain of 3,171.66 lakhs to the Group.
During the previous year the Group has sold Cogent Division (part of Others segment) to Gemalto Digital Securities Private Limited
as part of a global sale initiated by the Ultimate Holding Company for a total consideration of Rs. 942.00 lakhs during the year. As
part of the transaction, the Group transferred fixed assets having a book value of Rs. 37.00 lakhs. This transaction resulted in a
total gain of Rs. 905.00 lakhs to the Group.
(Rs. in lakhs)
Results of discontinuing operation 31 March 2019 31 March 2018
Revenues 782.93 4,874.51
Expenses 691.86 4,120.13
Profit before tax 91.07 754.38
Gain on disposal 3,171.66 905.00
Profit from discontinuing operations before tax 3,262.73 1,659.38
Income tax 959.24 654.40

Profit after tax 2,303.49 1,004.98

Cashflows from discontinuing operations 31 March 2019 31 March 2018

Cash flow from Operating activities 91.07 662.28

Sales consideration received 3,771.00 942.05

Net Cashflows for the year 3,862.07 1,604.33

237
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3M India Limited

(Rs. in lakhs)
42. Business combination
During the current year, the board of directors at their meeting held on 30 May 2018 and shareholders through postal ballot on
26 July 2018, approved the investment of 100% shareholding in 3M Electro & Communications India Private Limited. Accordingly,
the Company has entered into Share purchase agreement dated 31 October 2018 to acquire 100% equity interest in 3M Electro &
Communications India Private Limited for a total consideration of Rs. 58,470 lakhs.The above business combination is a common
control transaction and has been accounted for using the pooling of interest method with effect from 1 April 2017. The Company
as part of the business combination has acquired net assets of Rs. 9,188 lakhs resulting in an adjustment of Rs. 49,282 lakhs in the
consolidated retained earnings as at 1 April 2017.

43. Additional information pursuant to para 2 of general instructions for preparation of the consolidated financial statements

Net assets, i.e., Total assets Share in

minus Total liabilities profit or loss
Name of the entity As a % of As a % of
consolidated Amount consolidated Amount
net assets net assets
Parent
3M India Limited 130% 185,953.03 88% 32,286.31
Subsidiary
3M Electro & Communications India Private Limited 11% 15,800.54 12% 4,325.31
Adjustment arising out of consolidation -41% (58,470.00) 0% -
Total 143,283.57 36,611.62
44. The disclosures regarding details of specified bank notes held and transacted during 8 November 2016 to 30 December 2016 has
not been made in these consolidated financial statements since the requirement does not pertain to financial year ended 2019.

As per our report of even date attached

For B S R & Co. LLP For and on behalf of the Board of Directors
Chartered Accountants
Firm registration number: 101248W/W-100022 Debarati Sen B V Shankaranarayana Rao
Managing Director Whole-time Director
Amit Somani [DIN: 07521172] [DIN – 00044840]
Partner
Membership No: 060154 Mamta Gore V. Srinivasan
Place: Paris Place: Bangalore Chief Financial Officer Company Secretary
Date: May 28, 2019 Date: May 28, 2019 [PAN: AKIPG9089M] [ACS – 16430]

238
 ATTENDANCE SLIP
 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -  - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 

(To be presented at the entrance)

3M INDIA LIMITED
CIN: L31300KA1987PLC013543
Registered Office: Plot Nos. 48-51, Electronic City, Hosur Road, Bengaluru – 560100
Phone: 080-22231414, Fax: 080-2223 1450 email id: investorhelpdesk.in@mmm.com, website: www.3m.com/in

32NDANNUAL GENERAL MEETING ON WEDNESDAY, AUGUST 14, 2019 AT 11.00 A.M.

at Trinity Hall, Taj MG Road, 41/3, Mahatma Gandhi Road, Bengaluru – 560 001.
I/We hereby record my / our presence at the 32nd Annual General Meeting of the Company on Wednesday, August 14, 2019 at
Trinity Hall, Taj MG Road, 41/3, Mahatma Gandhi Road, Bengaluru – 560 001at 11.00 A.M.

.................................................................. .................................................................... ....................................................................

Member’s Folio/DPID-Client ID No. Member’s/ Proxy’s name in Block Letters Member’s/ Proxy’s Signature

Note:

1. Sign this attendance slip and hand it over at the attendance verification counter at the entrance of the Meeting Hall.

2. Bodies corporate, whether a Company or not, who are members, may attend through their authorized representatives appointed
under Section 113 of the Companies Act, 2013. A copy of authorization should be deposited with the Company.

3. In case of Shares held in demat/electronic form, the signature of the Beneficial Owner is liable for verification with the record
furnished to the Company by NSDL/CDS.

4. Electronic copy of the Annual Report for the FY 2018-19 and Notice of the Annual General Meeting (AGM) along with attendance
slip and proxy form is being sent to all the members whose email address is registered with the Company/ Depository Participant
unless any member has requested for a hard copy of the same. Members receiving electronic copy and attending the AGM can
print copy of this Attendance Slip.

5. Physical copy of the Annual Report for the FY 2018-19 and Notice of the AGM along with the attendance slip and proxy form is
sent in the permitted mode(s) to all members whose email is not registered or have requested for a hard copy.

The electronic voting particulars are set out below:

EVEN USER ID PASSWORD

(E-Voting Event Number)
XXXXXXX XXXXXXX XXXXXXXX

Please refer Notice for instructions on remote e-voting.

E-voting facility is available during the following voting period

Commencement of remote E-voting End of remote E-voting

August 11, 2019 (Sunday) (from 9.00 AM) August 13, 2019 (Tuesday) (up to 5.00 PM)
 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -  - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 

PROXY FORM
[Pursuant to Section 105(6) of the Companies Act, 2013 and Rule 19(3) of the Companies (Management and Administration), Rules, 2014]
3M INDIA LIMITED
CIN: L31300KA1987PLC013543
Registered Office: Plot Nos. 48-51, Electronic City, Hosur Road, Bengaluru – 560100
Phone: 080-22231414, Fax: 080-2223 1450, email id: investorhelpdesk.in@mmm.com, website: www.3m.com/in
32ND ANNUAL GENERAL MEETING ON WEDNESDAY, AUGUST 14, 2019 AT 11.00 A.M.
at Trinity Hall, Taj MG Road, 41/3, Mahatma Gandhi Road, Bengaluru – 560 001.
Name of the member(s):
Registered address:

E-mail Id:
Folio No/ Client Id:
DP/ID:

I/We, being the member (s) of …………. shares of the above named Company, hereby appoint :

(1) Name: Address:

E-mail id: Signature: or failing him;
(2) Name: Address:
E-mail id: Signature: or failing him;
(3) Name: Address:
E-mail id: Signature: or failing him;
as my/our proxy to attend and vote (on a poll) for me/us and on my/our behalf at the 32nd Annual General Meeting of the Company, to be
held on August 14, 2019, Wednesday at 11.00 A.M. at Trinity Hall, Taj MG Road, 41/3, Mahatma Gandhi Road, Bengaluru – 560 001 and at any
adjournment thereof in respect of such Resolutions as are indicated below:

Resolution Optional*
Resolutions
No. For Against
ORDINARY BUSINESS
1. Adoption of Financial Statements (Standalone & Consolidated) for the financial year ended March 31, 2019.
2. Re-appointment of Mr. Jongho Lee (holding DIN: 06720950) who retires by rotation.
SPECIAL BUSINESS
3. Appointment of Mr. Biren Gabhawala (holding DIN: 03091772) as a Director of the Company.
4. Appointment of Ms. Sadhana Kaul (holding DIN: 02589934) as a Director of the Company.
5. Ratification of remuneration payable to Messrs. Rao, Murthy & Associates, Cost Auditors for the
Financial Year 2019-20.
6. Re-appointment of Mr. Biren Gabhawala (holding DIN: 03091772) as an Independent Director of the
Company for a second term.
7. Appointment of Mr. Ramesh Ramadurai (holding DIN: 07109252) as Managing Director of the Company.

Signed this…….. day of……….. 2019

Affix
Signature of shareholder ………………………………................................................... Revenue
Stamp
Signature of Proxy holder(s) …………………………....................................................
Notes :
1. This form of Proxy in order to be effective should be duly completed and deposited at the Registered Office/ Corporate Office of the Company, not less
than 48 hours before the commencement of the Meeting. A proxy need not be a member of the Company.
2. For the Resolutions, Explanatory Statement and Notes, please refer to Notice of the 32nd Annual General Meeting.
3*. It is optional to put a ‘X’ in the appropriate column against the Resolutions indicated in the Box. if you leave the ‘For’ or ‘Against’ column blank against
any or all Resolutions, your Proxy will be entitled to vote in the manner as he/she thinks appropriate. Please complete all details including details of
member(s) in above box before submission.
 3M India Limited

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 3M India Limited

NOTES

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3M India Limited

Concorde Block, UB City,

24, Vittal Mallya Road,
Bengaluru - 560001
Tel.: +91 80 2223 1414
Fax: +91 80 2223 1450 Please recycle. Printed in India.
www.3M.com/in © 3M 2019. All rights reserved.