Issuance of a Guarantee to Subsidiary Company - Regulation 30 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ( SEBI Listing Regulation )
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Tech Mahindra has issued a guarantee of up to Euro 67.67 million on behalf of its step-down subsidiary Pininfarina S.p.A., Italy, in favour of Rolls-Royce Motor Cars Limited. The guarantee is towards a Supply Agreement between Rolls-Royce and Pininfarina. The transaction is a related party transaction carried out at arm's length, in the ordinary course of business, and has been approved by the Audit Committee. The guarantee will be recorded as a contingent liability for the Company, though there is no present financial impact.
This adds a contingent liability of up to ~₹600+ crore (Euro 67.67M) to Tech Mahindra's books, exposing the parent to its subsidiary's supply obligations. While there is no immediate cash impact, it is a routine inter-group support measure and not expected to materially affect the stock.