On behalf of the Board of Directors, it is my privilege to present
the 39^th Annual Report of your Company for the Financial Year
ended March 31, 2025, along with the Audited Standalone
and Consolidated Financial Statements and Auditor's
Report thereon.

Your Company has been striving to enhance the value
proposition for all stakeholders while maintaining the
momentum of project sanctions, sustaining development levels
and optimizing costs. Your Company has played an important
part in accelerating the progress of the Indian economy, which
was amongst the fastest growing economies in FY 2024-25. By
consolidating our efforts and continuing to grow sustainably,
we can support in meeting the country's expanding energy
needs while creating value for stakeholders. Your Company
has registered another year of robust performance and made
substantial progress.

The year 2024-25 was excellent for your Company as it
demonstrated remarkable persistent performance to
achieve significant milestones in operational and financial
performance. The performance highlights of your company for
the FY 2024-25 are briefly mentioned here to give an overview
of accomplishments on all fronts:

BUILDING ON 39 YEARS: EMPOWERING FOR
FOUR DECADES OF SUCCESS

As your company proudly completes 39 years of empowering
India's power sector, it stands tall as a pillar of strength,
resilience, and innovation. Over nearly four decades, your
company has played a transformative role in financing and
developing power infrastructure, driving the nation's energy
growth. With a legacy built on integrity, excellence, and strategic
foresight, PFC is not only celebrating past achievements
but also preparing to embrace the future with renewed
commitment. As it is approaching the milestone of 40 years,
PFC is poised to scale greater heights, continuing its journey
as a key enabler of sustainable and inclusive development in
India's energy landscape. In the growth journey, this fiscal year
2024-25 has marked a period of notable accomplishments for
your Company, characterized by comprehensive performance.
The key highlights of achievements during the FY 2024-25 are
outlined as follows:

1. Prominent Accomplishments

•    36^th in Fortune 500 India' 2024

•    3^rd highest profit making CPSE in India

•    Largest Renewable Energy Financer in India

•    Crossed H5 Lakh crore mark in loan assets

•    IFSC's First Finance Company for Power & Infrastructure
lending i.e. PFC Infra Finance IFSC Limited received

approval from IFSCA for commencing its operations as
a Finance Company in IFSC GIFT City Gujarat.

•    PFC has been conferred "Governance Now PSU Award"
for both "Financial Performance" and "Excellence in
Learning and Development" recognized for its strong
financial performance and commitment to employee
development, the recognition highlighting PFC's robust
institutional governance and its overall contribution to
the power and financial sectors.

2. PFC's Financial and Operational Health:

A Pillar of Sustainable Growth

i.    Financial Excellence (Standalone)

•    Profit After Tax (PAT) increased by 21% in FY 2024-25
from H14,367 crore in FY 2023-24 to H17,352 in
FY 2024-25.

•    Net worth increased by 15% on account of increasing
profits i.e. H90,937 crore as at March 31, 2025 vs H79,203
crore as at March 31, 2024.

•    Earnings per share increase by 21% in FY 2024-25.

•    10% year on year increase in 54EC bonds portfolio with
54EC bonds-a low-cost fund avenue available to PFC of
H9,943.09 crore as on March 31, 2025 vs H8,994 crore as
on March 31, 2024.

ii.    Consolidated Performance: Driving Forward

•    15% increment in PAT i.e H30,514 crore in FY 2024-25 vs
H26,461 crore in FY 2023-24.

•    The gross loan assets recorded a growth of 12%,
H11,09,996 crore as at March 31, 2025 from H9,90,824
crore as at March 31, 2024.

•    Net Worth of the company grew by 16% in FY 2024-25
to H1,55,155 crore as compared to H1,34,289 crore in
FY 2023-24.

•    PFC Group, the nodal agency for implementation of
LPS Rules has been instrumental in reduction in legacy
dues of DISCOMs by 90% of total legacy dues.

•    Significant reduction in NPA

iii. Healthy Asset Portfolio

•    Total provision of H8,424 crore towards Stage- III Loan
Assets as at the end of FY 2024-25 against H5,43,120
crore Total Gross Loan Assets. The Net Stage-III Assets
stands at H2,093 crore as on March 31, 2025, which is

0.39% to the Total Gross Loan Assets.

•    Major projects resolved during the year:

iv. PFC'S Strategic Compass Towards Navigating
Tomorrow-'Nayi Soch Nayi Raahein'

Embracing the motto 'Nayi Soch Nayi Raahein' - Your
Company is steering into new directions, shaping the
future through innovative ideas and forward-looking
perspectives. With the amendment in the Memorandum
of Association, PFC's lending capabilities have been
extended to encompass the wider infrastructure and
logistics sectors with focus on charging infrastructure,
roads, ports, metro rail, smart cities, other infrastructure
projects etc.

During the year, your company has provided financial
assistance to projects such as metro rail, petroleum
refining, desalination plant and bio ethanol manufacturing.
It is focused on maintaining a 25% market share in India's
renewable capacity and exploring funding opportunities
in clean technologies such as energy storage - Battery &
Pumped Hydro, e- mobility, Green Hydrogen etc. and also
contribute to India's energy transformation and meeting
the Net Zero Targets.

Your Company's above navigation of strategic objectives
will be on the following lines:

4. Financial Performance - Standalone

i. Profitability

•    Preferred Lending Partner: Consolidate its
position as the lender of choice in the Power, Energy
and Infrastructure sectors, financing solutions to
government and private borrowers at reasonable costs.

•    Net-Zero Leadership: Lead investments towards
achieving India's Net-Zero emissions goal by prioritizing
investments in green infrastructure projects. Leverage
the expertise to catalyze sustainable energy solutions
that align with global climate objectives.

•    Sectoral Reforms and Innovation: Spearhead
transformative reforms in the Power, Energy, and
Climate sectors, collaborating closely with the
Government of India to implement policies and
programmes of GoI for power sector.

•    Diversified Growth: Expand the lending portfolio into
new and emerging areas in power and infrastructure
sector and adapt to evolving market dynamics to
capitalize on new opportunities which can help in
reducing the cost of power to the end consumer and to
ensure viability of emerging technologies.

3. Powering Growth Through Numbers-
A Financial Synopsis

Your company has demonstrated strong financial growth
in FY 2024-25. Both Profit Before Tax and Profit After Tax
have seen significant double-digit increases. This positive
trend is supported by a substantial increase in total
income, primarily driven by revenue from operations.
While total expenses also increased, the growth in revenue
outpaced the growth in expenses, leading to improved
profitability. The dominance of finance costs within total
expenses remains a key characteristic of your company's
financial structure. Total Comprehensive Income also saw
a healthy increase. The government's substantial holding
in the company's equity remains a significant aspect of its
ownership structure.

ii. Other Equity (Retained Earnings)

iii. Dividend

The Board of Directors of the Company has recommended final dividend H676.52 crore @ 20.5% on the paid up equity share
capital i.e. H2.05 /- per equity share of H10/- each for the FY 2024-25, subject to the approval of the shareholders at the ensuing
Annual General Meeting. The Company had also paid interim dividend H4,537.64 crore @ 137.5% on the paid up equity share
capital i.e. H13.75 /- per equity share of H10 /- each during FY 2024-25.

^ARecommended for approval of Shareholders

Details of Interim Dividend paid & Final Dividend payable in FY 24-25 and Interim / Final dividends paid in previous years are
as follows:

H Interim Dividend paid per share in J | Total Dividend pay out in J crore

5. Operational Performance

i. Asset Quality

ii. Key Financial Ratios of the Company for FY 2024-25 Vis-A-Vis FY 2023-24 are given below:

4.    Exhibition Participation & Sectoral
Showcases

Your Company maintained a prominent presence at key
sectoral exhibitions during the year:

•    GRIDCON 2025: PFC showcased its leadership in grid
modernisation, SCADA automation, and green finance
at a dedicated exhibition stall.

•    India Energy Week 2025: PFC's stall, hosted within the
Ministry of Power Pavilion, highlighted cutting-edge
intelligent metering systems and digital grid solutions.
These exhibits emphasized PFC's commitment to
technological excellence and energy efficiency.

•    ELECRAMA 2025: PFC actively engaged with key
themes of smart energy and decarbonisation through
coordinated social media and partner participation.

5.    Sports Engagement - Hockey India
Sponsorship

PFC served as the Title Sponsor for the India vs Germany
Bilateral Hockey Series held in October 2024 at Major
Dhyan Chand National Stadium, New Delhi. This landmark
event marked the return of international hockey to the
capital after a decade. PFC enabled free digital ticketing for
the public, promoting national sport and social inclusion.
The event significantly enhanced PFC's brand visibility and
stakeholder goodwill.

6.    Swachhata Hi Seva Campaign

As part of the Government of India's nationwide cleanliness
drive, PFC organized comprehensive Swachhata activities
in Delhi. Employees actively participated in cleaning
public areas such as Shivaji Bridge Railway Station and
Connaught Place. Hygiene kits were distributed to vendors
and sanitation workers. These activities reinforced the
corporation's commitment to civic responsibility and
sustainable urban development.

7.    Strategic Social Media Impact

PFC's digital communication strategy played a critical
role in amplifying the impact of these initiatives.
Highlights include:

8. Borrowings

i. Borrowings from Domestic Market

During the FY 2024-25, an amount of H84,609 crore was
mobilized through domestic market as per the details
given below:-

(H in crore)

Cash Credit/ Overdraft Facilities

For day to day operations, your company continued
to follow prudent strategies for optimum utilization of
fund based resources. To hedge any financial liquidity
bottlenecks, ample credit lines to the tune of H15,750
crore were sanctioned as on March 31, 2025 by various
scheduled commercial banks to the company for short
term funding.

LCR Compliance

RBI has prescribed Liquidity Coverage Ratio (LCR)
framework for NBFCs. These guidelines aims for
maintenance of a liquidity buffer in terms of LCR by
ensuring that NBFCs have sufficient High Quality Liquid
Asset (HQLA) to survive any acute liquidity stress scenario
lasting for next 30 days.

PFC is maintaining 100% of the HQLA requirement to
cover net cash outflows over the next 30 calendar days, in
compliance with the RBI guidelines on LCR. HQLA stood at
H2,280.88 crore (LCR Ratio 140.64%) as on March 31, 2025.

ii. External Borrowings

The foreign currency denominated borrowings during
FY 2024-25 are as follows:

Green Bonds

PFC established its Green Bond Framework in October,
2017 as approved by Climate Bonds Initiative (CBI), London,
UK. The Green Bond framework for funding renewable

projects (viz. Solar and Wind) has been updated in August,
2021 to align with the latest set of guidelines namely
Climate Bonds Standard version 3.0, the Green Bond
Principles (GBP), 2021 issued by the International Capital
Markets Association (ICMA). In this context, an agreement
was executed between PFC & Climate Bonds Initiative.

The Green Bonds issued by PFC:

Annual update to the holders of the bonds, as required
under the PFC's Green bond framework is as follows:-

The funds raised under Green bonds have been utilized
to finance renewable energy projects as per the "Eligible
Projects" under PFC's Green Bond Framework. As at
March 31, 2025, outstanding loan balances of Solar & Wind
energy projects funded by PFC are H22,118 crore & H16,971

crore respectively. The total capacity of Solar & Wind
energy projects funded by PFC and which are outstanding
as on March 31, 2025 is 14,670 MW. Accordingly, PFC green
bond portfolio is more than the amount raised through
issue of green bonds.

Externally Aided Projects

Outstanding balance from multilateral/ bilateral agencies

as at March 31 2025 is as follows

* Includes EUR 58,747,000.56 disbursed by KfW in FY 2022-23 and Eur
17,763,829.26 in FY 2023-24 under Discom Investment Facility (ODA
Loan- Without Govt. Guarantee).

9. Domestic and International Credit Rating

Your company has been assigned the highest ratings by
Domestic Credit Rating Agencies and Sovereign Rating by
International Credit Rating Agencies as at March 31, 2025.
Your Company believes that these credit ratings enables
us to develop strong relationship with our lenders and
borrow funds at competitive rates.

10. Memorandum of Understanding with Govt.
of India

Your Company enters into a Memorandum of
Understanding (MoU) with the Ministry of Power (MoP)
every year wherein your Company is evaluated on various
financial and non-financial parameters. The performance
of your company in this regard is as follows:

•    Consistent Rating: 'Excellent' by Government of India

•    FY 2023-24: 'Excellent' Rating Received

•    FY 2024-25: Rating Awaited

In FY 2024-25, the achievement of your Company on some
of the key MoU parameters (on standalone basis) has
been as under:

11. Subsidiaries

A. REC Limited

Your company is the promoter & holding company of
REC, with shareholding of 52.63% in its paid up equity
share capital.

REC is also a Systemically Important (Non-Deposit
Accepting or Holding) Non-Banking Finance Company
(NBFC) registered with Reserve Bank of India (RBI) as
an Infrastructure Finance Company (IFC). Its business
activities involve financing projects in the complete
power sector value chain, be it generation, transmission
or distribution. REC provides financial assistance to state
electricity boards, state governments, central/state power
utilities, independent power producers, rural electric
cooperatives and private sector utilities.

Further, during the FY 2024-25, the total income of REC
was H55,979.62 crore vis-a-vis H47,571 crore in the previous
FY 2023-24 and the net profit earned by REC during
FY 2024-25 was H15,713.21 crore as against the corresponding
net profit of H14,019.21 crore for last FY 23-24.

The detailed operational and financial performance of
REC is available on its website i.e. www.recindia.nic.in

The following subsidiaries of REC as on March 31, 2025 are
also subsidiaries of PFC:

i.    REC Power Development & Consultancy Limited

ii.    Chandil Transmission Limited

iii.    Dumka Transmission Limited

iv.    Mandar Transmission Limited

v.    Koderma Transmission Limited

vi.    Luhri Power Transmission Limited

vii.    Shongtong Power Transmission Limited

viii.    Kankani Power Transmission Limited

ix.    Tuticorin Power Transmission Limited

x.    WRNES Talegaon Power Transmission Limited

xi.    Rajgarh III Power Transmission Limited

xii.    Jejuri Hinjewadi Power Transmission Limited

xiii.    Velgaon Power Transmission Limited

B. PFC Consulting Limited

PFC Consulting Limited (PFCCL) is a wholly owned
subsidiary of your company. It has been offering
consultancy support to the Power Sector. The Services
offered by PFCCL are broadly in the following areas:

•    Transaction Advisory: End-to-End solutions in
Transaction Advisory Services across different areas in
power sector (Selection of Sellers/Developers, Reform
& Restructuring, Independent Transmission Projects,
Privatization of Electricity Distribution in Union
Territories, Resolution Plan and RE-Bundling)

•    Project Development: Project Development &
implementation of various GoI initiatives (Ultra
Mega Power Projects, Lender's Independent
Engineer, Lender's Insurance Advisor, Setting up of
Manufacturing Zone for power and renewable energy
equipment, Subsea Cables)

•    PMA / PMC/ GoI Schemes: Project management &
change agents focusing on revamped solutions &
aiming for loss reduction (Revamped Distribution
Sector Scheme, Procurement of Power, DEEP
Portal, Coal Linkage Auction under SHAKTI Scheme,
Pilot Scheme, PRAAPTI Portal, Integrated Power
Development Scheme)

•    Smart Solutions: Smart solutions to improve
performance & processes, productivity & pro¬
active planning (Smart Metering, Energy Portfolio
Management)

•    Policy Formulation Support: Support to Government/
Regulators for formulation of Policies, Regulatory
framework and Guidelines & SBDs

•    Other Services: Strategy, Regulatory, Tariff Support,
fund mobilization and other aspects of power sector

Till date, consultancy services have been rendered by
PFCCL to its clients spread across India. The total no. of
projects/ assignments undertaken as on date are more
than 200.

Further, during the FY 2024-25, performance of PFCCL is
as follows:

Your Company is designated by Ministry of Power (MoP)
as the 'Nodal Agency' for facilitating development of Ultra
Mega Power Projects and its wholly owned subsidiary i.e.
PFC Consulting Limited is the 'Bid Process Coordinator' for
Independent Transmission Projects.

As on March 31, 2025, the following subsidiaries of PFCCL
are also subsidiaries of PFC:

1.    Chhatarpur Transmission Limited

2.    Siot Transmission Limited

3.    Joda Barbil Transmission Limited

4.    Ramakanali B -Panagarh Transmission Limited

5.    Gola B -Ramgarh B Transmission Limited

6.    KPS III HVDC Transmission Limited

7.    Bhuj II Transmission Limited

8.    Angul Sundargarh Transmission Limited

9.    Bhadla and Bikaner Complex Transmission Limited

10.    Bhuj ICT Transmission Limited

11.    Kakinada I Transmission Limited

12.    Kandla GHA Transmission Limited

13.    MEL Power Transmission Limited

14.    NER Expansion Transmission Limited

15.    NES Dharashiv Transmission Limited

16.    NES Navi Mumbai Transmission Limited

17.    NES Pune East New Transmission Limited

18.    Raghanesda RE Transmission Limited

19.    Wahipora and Sallar Transmission Limited

C.    PFC Infra Finance IFSC Limited (PIFIL)

PFC Infra Finance IFSC Limited was incorporated on
February 11, 2024 as wholly-owned subsidiary of Power
Finance Corporation Limited. The Company received
approval from International Financial Services Centres
Authority (IFSCA) on October 10, 2024 to commence
business as Finance Company in IFSC GIFT City Gujarat.

Your Company is the first Govt. NBFC which has
established a subsidiary in the International Financial
Services Centre (IFSC) at GIFT City, Gujarat dedicated to
Power and Infrastructure Lending in foreign currency.
IFSC provides a unique platform to access global capital
and expertise, which will enable your Company to provide
even more efficient and innovative financing solutions to
the clients. PFC's entry into the IFSC shall open up new
business opportunities and establish its global presence.
This Company will focus on providing financial solutions
for infrastructure projects across various sectors,
including renewable energy.

D.    PFC Projects Limited (PPL)

PFC Projects Limited (PPL), formerly Coastal Karnataka
Power Ltd., was established as a wholly owned subsidiary
of PFC for developing an Ultra Mega Power Project in
Karnataka. In 2022, its name and charter were amended
to allow participation in Lenders' Backed Resolution Plans
(LbRP).

PPL partnered with REC Ltd. and others to submit a
resolution plan under CIRP for Lanco Amarkantak Power
Ltd. (LAPL). The consortium was initially declared the
Successful Resolution Applicant (SRA), but later opted out
of the challenge process initiated by NCLT, on the condition
that incurred costs be reimbursed—which was done.

Later, PPL submitted an EOI for CIRP of two KSK Mahanadi
Power SPVs, but PFC and REC couldn't proceed due to the
absence of DIPAM approval. DIPAM, via its letter dated

December 21, 2023, advised against LbRPs citing financial
and risk concerns.

As no future business is expected, the Board of PPL
approved striking off the company's name from the
ROC under the Companies Act, subject to approvals and
settlement of liabilities.

E. Other Subsidiaries Established for
Development of UMPP'S:

1.    Orissa Integrated Power Limited

2.    Coastal Tamil Nadu Power Limited

3.    Sakhigopal Integrated Power Company Limited

4.    Ghogarpalli Integrated Power Company Limited

5.    Deoghar Mega Power Limited

6.    Cheyyur Infra Limited

7.    Odisha Infrapower Limited

8.    Deoghar Infra Limited

9.    Bihar Infrapower Limited

10.    Bihar Mega Power Limited

11.    Jharkhand Infrapower Limited

I n view of the country making energy transition from
fossil to non-fossil fuel, it was deliberated in MoP to close
the UMPPs. MoP directed PFC to take necessary action for
closure of UMPPs. Accordingly, PFC/PFCCL has initiated the
process for closure of SPV's established for development
of UMPPs.

12. Building Resilience: Our Multi-Layered Risk
Approach

i. Asset Liability Management

Your Company has implemented a comprehensive and
robust Asset Liability Management (ALM) Policy, aligned
with the Reserve Bank of India (RBI) guidelines. The policy
is designed to ensure focused and proactive management
of liquidity and interest rate risks as follows:

Risk Monitoring Methodologies:

1.    Liquidity Risk: Monitored using the cash flow
approach to assess the timing of cash inflows
and outflows.

2.    Interest Rate Risk: Measured through traditional gap
analysis, as prescribed by the RBI, to understand
mismatches across various time buckets.

Measurement and monitoring of Liquidity risk is done
through cash flow approach; and for Interest rate risk,
it is done through traditional gap analysis technique
as detailed in RBI guidelines. Such analysis is made on
periodical basis in various time buckets and is used for
critical decisions regarding the time, volume and maturity
profile of the borrowings and creation of mix of assets and
liabilities in terms of time period (short, medium and long¬
term) and in terms of fixed and floating interest rates. The
details of the asset liability management maturity pattern
are given at Note No. 53.1 of the Notes to Accounts of
the Standalone Financial statements forming part of this
Annual Report.

ii.    Foreign Currency Risk Management

Your Company has put in place "Policy for Management
of Risks on Foreign Currency Borrowings" to manage
risks associated with foreign currency borrowings. The
Company enters into hedging transactions to cover
exchange rate and interest rate risk through various
instruments like forwards, options and swaps.

As on March 31, 2025, the total o/s foreign currency
liabilities stand at USD eqv 10,415 mn, and the borrowings
denominated in different currencies are USD 7,238 mn,
JPY 2,86,367 mn, EUR 1,023 mn & GBP 135 mn. Out of the
total foreign currency borrowing portfolio 95% is hedged

i.e. USD eqv 9,906 mn. Also, 96% of the FC portfolio with
residual maturity up to 5 years is hedged.

iii.    Information Security Risk Management

Your company has established a Board level "Information
Technology Strategy Committee" (ITSC) as per the RBI
Master Direction on Information Technology Governance,
Risk, Controls and Assurance Practices for the NBFC.
ITSC ensures that the IT Strategy aligns with the overall
strategy of the organization towards accomplishment
of its business objectives. ITSC is headed by an
Independent Director.

Further, your company also has in place an Information
Security Committee (ISC) headed by Chief Risk Officer
(CRO) under the oversight of ITSC for managing information
security, development of information security policies,
implementation of policies, standards and procedures.

PFC has also nominated a Chief Information Security
Officer (CISO) for monitoring information security strategy
and ensuring compliance to the extant regulatory/
statutory instructions on information/ cyber security.

In compliance with RBI Master Direction, PFC has
implemented BoD approved IT policy covering the
following security related components:

i.    Physical and Environmental Security Policy

ii.    Access Control Policy

iii.    IT Cyber Security Policy

iv.    Business Continuity Policy

iv.    Integrated Enterprise Wide Risk
Management

In order to manage risks faced by your Company, it has put
in place an Integrated Enterprise Wide Risk Management
Policy (IRM policy). For implementation of the policy,
your Company has constituted the Risk Management
Committee. Under the IRM policy, the Company has to
identify the principal risks which may have an impact on
its profitability/revenues. In this regard, the Company has
identified significant risk parameters which arise from the

Company's business model and from its use of financial
instruments. These risk parameters cover the major
operational risks, financial risks, market risks, regulatory
risks etc. faced by the Company and are regularly assessed
as per the Risk Assessment Criteria. Further, the Company
also maintains a risk register which serves as repository of
relevant information related to various risks.

13. Catalyzing Power Sector Reforms: Our
Government Partnership

i. Revamped Distribution Sector Scheme
(RDSS) & Integrated Power Development
Scheme (with Restructured Accelerated
Power Development and Reform
Programme (R-APDRP) Subsumed in IT)

The Company is involved in various GoI programs for
the power sector including acting as the Nodal Agency
for operationalization and implementation of Revamped
Distribution Sector Scheme (RDSS) launched by Govt.
of India in July, 2021. PFC was also the designated nodal
agency for operationalization of IPDS and R-APDRP
Schemes. Both of the Schemes have been Sunset in
March, 2022.

Revamped Distribution Sector Scheme
(RDSS)

MoP/ GoI launched the "Revamped Distribution Sector
Scheme (RDSS) - A Reforms-based and Results-linked,
Distribution Sector Scheme" in July 2021 to improve the
operational efficiencies and financial sustainability of
DISCOMs, by providing financial assistance to DISCOMs for
upgradation of the Distribution Infrastructure and Prepaid
Smart Metering & System Metering based on meeting
pre-qualifying criteria and achieving basic minimum
benchmarks in reforms. PFC and our subsidiary REC are
the designated nodal agencies for operationalization of
the Scheme, as per RDSS guidelines and directions of
inter-ministerial Monitoring Committee/ MoP from time
to time.

Nodal agencies are eligible for 0.5% of the sum total of
the Gross Budgetary Support (GBS) component of the
various projects approved by Monitoring Committee as
its fee. PFC is the nodal agency for 17 States/ UTs under
the Scheme. The present implementation period of the
Scheme is 5 Years (FY 2021 -22 to FY 2025-26). The Scheme
has an outlay of H3,03,758 crore. with an estimated
gross budgetary support of H97,631 crore. from the
GoI. RDSS also envisages electrification of balance/ left-
out households.

During April 1, 2022 to June 30, 2025, PFC incurred an
expenditure of H31.50 crore under various heads like
Project Coordinators, Manpower & Consultant, Site Office,
Website management etc. maintained under RDSS.

Role of PFC in the implementation of RDSS Scheme and
other activities/ Initiatives under RDSS

The wide range of activities being performed by PFC under
RDSS and for other allied Schemes of GoI are listed below:

a.    Core Activities for RDSS

•    Overall facilitation and Program management
including appraisal of projects, quality monitoring,
monitoring compliance of scheme guidelines,
resolving queries of DISCOMs, coordination with
MoP/ CEA etc.

•    Annual result evaluation framework of DISCOMs
including monitoring of regulatory parameters
e.g. subsidy accounting, Govt. dues, analysis of
tariff orders, analysis of sales data etc.

•    Capacity building/ training programme for skills
development of DISCOMs' employees. 450 training
programs have been conducted through NPTI,
DISCOM institutes and other agencies covering
~13,350 DISCOM personnel including 4,300 days
of training imparted to women employees under
RDSS cumulatively so far.

b.    Supporting Activities for RDSS/ Allied

programs of GoI

•    Counterpart funding - PFC is supporting
the counterpart (CP) funding @ 40% (10% for
special category States) of the project cost for
Loss Reduction (LR) projects under RDSS. PFC
has so far sanctioned CP loans of H18,516 crore
and disbursed H2,557 crore for LR works under
RDSS. To support the RDSS Program of GoI, PFC
is offering special interest rate to DISCOMs for
RDSS CP loans. In addition, PFC is also extending
interim loans to DISCOMs in case of any paucity
of GoI funds, to maintain adequate fund flow
for project implementation and has sanctioned
H20,972 crore and disbursed H1,186 crore towards
interim loans.

•    Implementation of Smart Distribution Network
pilot projects in selected cities across India.

•    Ensuring Household electrification for
remotest corner of the Country - Sanction

and monitoring of electrification of over 80,000
Particularly Vulnerable Tribal Groups (PVTG)
households (PFC States) under PM JANMAN
Program and 65,000 identified households; 3,000
public institutions across ~9,000 villages under
DA-JGUA Scheme being funded under RDSS.

•    Facilitation with DISCOMs for Projects covered
under National Infrastructure Pipeline (NIP); Ease
of Living (EoL) parameters; PM-KUSUM; PM-AJAY;
PM Surya Ghar Yojana; Border area electrification;
left-out household electrification; supply to BSNL
Telecom towers in remote areas etc.

c. Other Concurrent Activities

•    PFC is supporting the States by preparing
Model Bidding Documents for Automation
and ERP projects under RDSS; monitoring of
implementation of SCADA systems; developing
National SCADA Resource Centre (NSRC);
development of Integrated web portal for various
government Schemes including RDSS; tie-up with
multilateral agencies viz. ADB, KfW for funding
under RDSS and FCDO, USAID, GiZ etc. for training
& capacity building of DISCOM personnel.

•    PFC was instrumental in development of Digital
Utility Manager (DUM) training program to
enhance the skills of power sector professionals
and utility employees in adopting emerging
digital technologies. This self-paced course was
made available on the iGOT Karmayogi Portal in
March, 2025 and is designed to help professionals
stay competitive and resilient amidst the evolving
energy transition. The program consists of 16 key
modules covering a wide range of topics.

•    As part of Accelerating Smart Power & Renewable
Energy in India (ASPIRE) program supported by
the UK Government's Foreign, Commonwealth
& Development Office (FCDO), PFC also took
the initiative to assess the composition &
participation rate of women in the workforce of
Power Distribution sector and published a report
on Gender Equity in Power Distribution sector.

Impact of RDSS in Power Distribution Sector

Various regulatory as well as corporate governance
related reform measures being implemented in the
DISCOMs (interalia including RDSS), have started showing
desired results:

•    Tariff orders are being issued regularly.

•    Reduction in Average AT&C loss of distribution utilities
in country from 22.3% in FY 21 to 16.3% in FY 24.

•    The gap between ACS and ARR (cash basis) has
improved from H0.92 per KwH in FY 21 to H0.39 per KwH
in FY 24.

•    Timely payments of subsidy and Govt. department
dues by State Governments have contributed to
reduction of ACS-ARR Gap.

•    Quarterly accounts are now being submitted regularly.

•    Scheme also places strong emphasis on enhancing
consumer satisfaction with improvement in service
quality, leading to increased consumer trust and loyalty.

ii.    Late Payment Surcharge Rule, 2022

Ministry of Power (MoP) vide Gazette Notification dated
June 3, 2022, notified "The Electricity (Late Payment
Surcharge and Related Matters) Rules, 2022" (LPS Rules).
Your Company has been designated by MoP as the Nodal
Agency for implementation of LPS Rules, 2022. PFC shall be
responsible for all the activities related to implementation
of the said Rules including regular review and monitoring.

With the implementation of Electricity (LPS and Related
Matters) Rules, 2022, remarkable improvement has been
seen in recovery of outstanding dues of Suppliers including
Generating Companies, Transmission Companies and
Traders. Against legacy dues of H1,39,947 crore as on
June 03, 2022, 13 States/UTs have paid instalment of
H1,24,768 crore (35 EMIs) upto June 2025 i.e. 90% of total
legacy dues. Further, 20 States/ UTs reported to have no
outstanding dues as on June 03, 2022. Now the legacy dues
(overdues) have reduced from H1,39,947 crore to H13,698
crore and as on date there is no default in payment of
instalments for legacy dues by States.

In view of provision of regulation under LPS Rules, 2022,
the Distribution companies are paying their current dues
in time. Since implementation of the rule, as on June 10,
2025, total bills amounting to H13,77,668 crore have been
settled against total billed amount of H14,58,480 crore
from May 2022(excluding EMI Payments against legacy
dues and including Disputed Invoices).

iii.    Independent Transmission Projects (ITPs)

To promote private investment and accelerate the
growth of India's transmission infrastructure, the
Ministry of Power has implemented a Tariff-Based
Competitive Bidding (TBCB). Projects are prepared up to
key milestones—including surveys, route planning, land
acquisition, and statutory clearances before being offered
to investors.

As on March 31, 2025, 101 SPVs were established for
transmission development: 89 for inter-state and 12 for
intra-state projects. 2 SPVs were set up by your company,
while 99 were established by PFC Consulting Ltd.

Significant Developments

Further, during the FY 2024-25, following SPVs
established for development of transmission projects
have been transferred to the successful bidders selected
through TBCB:

1.    Barmer I Transmission Limited

2.    Beawar - Mandsaur Transmission Limited

3.    Bhadla-III & Bikaner-III Transmission Limited

4.    Jamnagar Transmission Limited

5.    Khavda PS1 And 3 Transmission Limited

6.    Paradeep Transmission Limited

7.    Pune- III Transmission Limited

8.    Sirohi Transmission Limited

9.    South Olpad Transmission Limited

10.    Navinal Transmission Limited

11.    Mundra I Transmission Limited

12.    Kurnool III PS RE Transmission Limited

13.    Kudankulam ISTS Transmission Limited

14.    Jam Khambhaliya Transmission Limited

15.    Gadag II and Koppal II Transmission Limited

16.    Fatehgarh II and Barmer I PS Transmission Limited

17.    Chitradurga Bellary REZ Transmission Limited

18.    Bijapur Rez Transmission Limited

19.    Anantapur II REZ Transmission Limited

As on March 31,2025, out of 99 SPVs, 74 SPVs (69 are related
to inter-state transmission scheme and 5 are related to
intra-state transmission scheme) were transferred to
the successful bidders. Further, due to de-notification of
schemes by MoP, 5 SPVs were closed.

iv. Ultra Mega Power Projects (UMPPs)

Development of Ultra Mega Power Projects (UMPPs),
with a capacity of about 4,000 MW each, adopting super
critical technology is the initiative of MoP, Government of
India for which your Company has been designated as the
'Nodal Agency' and Central Electricity Authority (CEA) as
the Technical Partner by MoP.

Your Company incorporated a total of 19 Special Purpose
Vehicles (SPVs) as its wholly-owned subsidiaries for
development of UMPPs. Out of these, 4 UMPPs are
awarded and 7 UMPPs are closed.

I n view of the country making energy transition from
fossil to non-fossil fuel, it was deliberated in MoP to close
the UMPPs. MoP directed PFC to take necessary action for
closure of UMPPs. Accordingly, PFC/PFCCL has initiated the
process for closure of SPV's established for development
of UMPPs.

14. Other Major Investments

i. PTC India Limited

PTC India Limited (PTC) was jointly promoted by Power
Grid, NTPC, NHPC and PFC. PFC has invested H12 crore

in PTC which is 4.05% of PTC's total equity. PTC is the
leading provider of power trading solutions in India, a
Government of India initiated public-private partnership,
whose primary focus is to develop a commercially vibrant
power market in the country.

ii.    Power Exchange India Limited

Power Exchange India Limited (PXIL) is India's first
institutionally promoted Power Exchange that provides
innovative and credible solutions to transform the Indian
Power Markets. PXIL, provides nation-wide, electronic
exchange for trading of power and handles power trading
and transmission clearance, simultaneously, it provides
transparent, neutral and efficient electronic platform.
PXIL offers various products such as Day Ahead, Day
Ahead Contingency, Any Day, Intra Day and Weekly
Contracts. PXIL provides trading platform for Renewable
Energy Certificates. PFC's investment in equity shares of
PXIL as on March 31, 2025 is H5.06 crore. PFC's investment
value as on March 31, 2024 is H4.78 crore.

iii.    Energy Efficiency Services Limited

Energy Efficiency Services Limited (EESL) was incorporated
on December 10, 2009. EESL was jointly promoted by Power
Grid, NTPC, REC and PFC with 25% equity stake each for
implementation of Energy Efficiency projects in India and
abroad. The shareholding of your company (along with its
subsidiary REC) as on March 31, 2025 is 21.49%.

iv.    NHPC Limited

PFC has initially invested 26,05,42,051 equity shares of
NHPC Limited at the rate of H21.78 per share (including
securities transaction tax, brokerage and other charges)
amounting to H567.49 crore in April 2016 during
disinvestment by GoI through offer for sale route. PFC has
sold 15,78,62,576 number of equities shares till March 31,
2025. As on March 31,2025 PFC holds 10,26,79,475 shares of
NHPC Limited valued at H844.03 crore. NHPC has reported
profit after tax of H3083.98 crore for the FY 2024-25
as compared to profit after tax of H3,721.80 crore for
FY 2023-24.

v.    Coal India Limited

PFC has invested 1,39,64,530 equity shares of Coal
India Limited at the rate of H358.58 per share (including
securities transaction tax, brokerage and other charges)
amounting to H500.74 crore in February 2015 through
offer for sale route. As on March 31, 2025, PFC holds
1,39,64,530 equity shares of Coal India Limited valued
at H556.07 crore. CIL has reported profit after tax of
H17,016.56 crore for the FY 2024-25 as compared to Profit
after Tax of H15,766.83 crore for FY 2023-24.

15. Initiatives for Monitoring DISCOM'S
Performance

i. Annual Integrated Rating of Power
Distribution Utilities

Ministry of Power, as part of its reform initiatives, has put
in place an Integrated Rating Framework to evaluate the

performance of power distribution utilities. The primary
objective of the Integrated Rating exercise is to grade all
utilities in the power distribution sector based on their
financial performance and their ability to sustain the
performance over time. Private Distribution Utilities and
Power Departments are also included to provide complete
sectoral coverage.

The rating framework objectively evaluates the
performance of distribution utilities across various
parameters broadly classified under i) Financial
Sustainability ii) Performance Excellence and iii) External
Environment. For Power Departments, a subset of metrics
with modified weightages has been adopted from the
overall methodology to ensure relevance and fairness
in assessment.

The ratings were carried out by Deloitte Touche Tohmatsu
India LLP, a reputed consulting firm, and were co-ordinated
by your Company. These ratings serve as valuable
diagnostic tools in the hands of the State Governments
as well as Utilities to leverage their strengths and address
areas requiring improvements so as to improve their
operational efficiency and financial sustainability.

The Thirteenth Integrated Ratings for FY 2023-24,
covering 63 utilities across the country, were released by
the Hon'ble Union Minister of Power and Housing & Urban
Affairs on February 20, 2025.

ii.    Annual Performance Report of Power Utilities

PFC has been publishing the Report on Performance of
Power Utilities annually. The Report covers State Power
Utilities in all states and UTs and major private distribution
companies, offering a comprehensive insight into the
Indian power sector. The Report covers a range of key
financial and operational parameters such as profitability,
gap between average cost of supply and average
revenue, net worth, receivables, payables, AT&C losses
and consumption pattern of the sector at utility, state
and national level. The Report is part of PFC's effort to
provide a reliable database on the performance of power
utilities offering critical inputs for policy interventions
and monitoring the progress of various GoI schemes in
the power sector. The Report for FY 2023-24 has been
published in May 2025.

iii.    Categorization of Utilities

For purposes of funding, your Company classifies
State Power Generation and Transmission entities into
A++, A+, A, B, C and D categories. The categorization
(biannually) of State Power Generation and Transmission
entities is arrived based on the evaluation of entity's
performance against specific parameters covering
operational & financial performance including regulatory
environment, availability of audited accounts, etc. as per
categorization policy.

With respect to State Power Distribution entities (including
PDs/entities with integrated operations), your Company's
categorization policy provides for adoption of MoP's

Integrated Ratings by aligning such ratings/grading with
PFC's standard categories of A+, A, B, C and D.

The categorization of Borrowers in the Logistics and Non¬
Power Infrastructure sector is carried out on the basis of
recommendations of the Internal Committee considering
the strengths and weaknesses of the project.

The categorization enables PFC to determine pricing of
loans and stipulation of security to the state power entities.

16. Right to Information: Empowering Citizens
Through Transparent Communication

The Right to Information (RTI) under the Right to
Information Act, 2005 ("RTI Act") is a constitutional right
that promotes transparency, accountability, and citizen
empowerment. It plays a pivotal role in ensuring that
public authorities are answerable for their decisions and
actions, while also enabling citizens, journalists, and civil
society to engage more meaningfully in governance.

The RTI Act empowers individuals with the right to
access information held by public authorities, subject to
certain exceptions. The Preamble of the Act highlights
its purpose: to promote transparency and accountability
in the working of every public authority through access
to information.

Power Finance Corporation (PFC) has put in place a robust
mechanism for the effective implementation of the RTI
Act. A dedicated Public Information Officer (PIO) and a
First Appellate Authority (FAA-RTI) have been appointed
at the company's registered office to manage information
requests. PFC also proactively publishes key information
and disclosures on its official website www.pfcindia.co.in.
in line with statutory requirements.

Between April 1, 2024, and March 31, 2025, PFC received
96 RTI applications, all of which were processed and
responded to within the stipulated timeframes. The
company also ensured timely filing of RTI Quarterly
Returns through the Central Information Commission's
(CIC) online portal.

In furtherance of compliance with Section 4 of the RTI Act,
the Department of Personnel & Training (DoPT), through
its Office Memorandum No. 1/6/2011-IR dated April 15,
2013, issued specific guidelines regarding:

•    Proactive disclosure under Section 4;

•    Digital publication of information;

•    Enhanced clarity in disclosures under Section 4(1)
(b); and

•    Establishment of a compliance framework for
proactive disclosure.

PFC has fully implemented these guidelines and made
all necessary disclosures available on its website.
Additionally, PFC is integrated with the RTI Online Portal
of the Government of India (https://rtionline.gov.in). This
portal allows Indian citizens to file RTI applications and
first appeals digitally, with payments accepted via SBI

internet banking, credit/debit cards (Visa, MasterCard),
and RuPay cards.

17.    Corporate Social Responsibility - Driving
Social Progress

PFC has formulated its CSR Policy in line with Section 135
of the Companies Act, 2013 and the Companies (CSR)
Rules, 2014 (as amended from time to time) and DPE
guidelines issued from time to time. The aim of PFC's
Corporate Social Responsibility Policy (CSR Policy) is to
ensure that the Company becomes a socially responsible
corporate entity committed to improving the quality of life
of society at large by undertaking projects for Sustainable
Development, mainly focusing on Health, Education and
Energy needs of the society.

To oversee the activities of CSR, PFC has in place a
Board level CSR Committee of Directors headed by an
Independent Director. Every year CSR Annual Action Plan
and Budget are recommended by CSR Committee and
approved by the Board. Third party impact assessment
agencies are being engaged to assess the benefit/outcome
of the projects.

PFC has implemented wide range of activities throughout
the Country in the field of Environment Sustainability,
Healthcare, Education, PM Internship, Rural Development,
contribution to Swachh Bharat Kosh and other areas as
specified under Schedule VII of the Companies Act, 2013.

The CSR Report under Companies (CSR Policy), Rules is
annexed herewith.

18.    Investing in our People: Training &
Development

a. Training & Development and Capacity
Building

Investing in employee capacity building is crucial for
achieving our strategic objectives and maintaining
a competitive edge. During FY 2024-25, the focus on
conducting customised programs was maintained
to ensure specific skill development aligned with the
corporate goals.

The programs on critical areas including Environmental,
Social and Governance (ESG), AML, KYC, CFT, General
Management Programs, Stressed Asset Resolution under
the Insolvency & Bankruptcy Code, 2016, Financial Frauds,
GIS, Governance, Public Procurement through GeM Portal,
Advanced Excel, Conduct, Discipline & Appeal (CDA) Rules
of PFC, Communication skills, CSR practices, RTI ACT etc.
were organized along with other need-based programs.

In addition to the above, other compliance-related
programs such as Awareness Workshop on Sexual
Harassment of Women at Workplace (Prevention,
Prohibition & Redressal) Act, 2013, Occupational Health &
Safety Hazards, Office etiquettes were organised.

All the fresh recruits of your company attended a 3-week
Foundation course of National Power Training Institute
(NPTI) wherein they were trained on Basics of Power

Sector, Renewables & Solar Energy, Government Schemes,
Energy Transition, Energy Conservation & Energy
Efficiency, SCADA, and Project Appraisal among other
topics. Employees are also encouraged to participate
in Conferences related to energy and infrastructure
sector, promoting continuous learning and exposure to
the industry.

Your Company organised General Management Programs
for employees due for promotion to equip them with skills
to take on higher roles and develop leadership qualities.

As of March 31,2025, 28 Nos. of In-house training programs
were organised by PFC for its employees. A total of 1921
man-days were achieved through conducting various in¬
house programs and sponsoring PFC employees to the
programs organised by other external training agencies

b. Recreational Activities (Engagement
Activity)

•    PFC is a founding member of Power Sports Control
Board (PSCB). PFC employees participated with
full vigour and enthusiasm in various Inter-CPSU
sports tournaments organized by the PSCB member
organizations during the FY 2024-25.

•    As a part of Inter CPSU tournaments, PFC organized a
Bridge Tournament from 25-27 November 2024 at New
Delhi. 10 Power sector PSUs including MoP participated
in the tournament.

•    Inter CPSU sports competition details - 118 employees
participated in PSCB sports during FY 2024-25.

•    PFC celebrated its Foundation Day for its employees
& their family member on July 16, 2024 at Bharat
Mandapam, New Delhi.

•    PFC organized One day picnic on February 15, 2025 for
employees and their dependent family members.

•    Every year, PFC celebrates various occasions such as
festival of Diwali, New Year etc to encourage a feeling
of togetherness among the employees.

c.    Human Resource Management

Your company has put in place effective talent acquisition
and retention practices, which are benchmarked with best
corporate practices designed to meet the organizational
needs. This apart from other strategic interventions leads
to an effective management of Human Resources thereby
ensuring high level of productivity.

The Industrial Relations within the company have
been very cordial and harmonious with the employees
committing themselves entirely to the objectives of the
company. There were no man-days lost during the year
under review. The attrition during the period from April 1,
2024 to March 31, 2025 was 0.73%.

d.    Employee Welfare Measures

Your Company is committed to strive towards adopting
the best management practices of the industry and
take up new initiatives for enhancing the productivity
of employees.

An effective package of employee welfare measures
which include comprehensive insurance, medical facilities
and other amenities lead to a healthy and productive
workforce. During the period, several employee related
policies and facilities were reviewed and revised.

PFC as part of its social responsibility makes all efforts to
ensure compliance of the Directives and guidelines issued
by the Government of India from time to time pertaining
to the welfare of female employees.

iii. Internal Complaints Committee

Your company has complied with the provisions relating
to the constitution of Internal Complaints Committee
under the Sexual Harassment of Women at Workplace
(Prevention, Prohibition and Redressal) Act, 2013.

Disclosures in relation to the Sexual Harassment of
Women at Workplace (Prevention, Prohibition and
Redressal) Act, 2013:

* As on March 31, 2025, no case was pending for more than ninety days.

iv. Talent Management

Your Company continues to strengthen its talent
management framework by aligning recruitment,
development and retention strategies with overall
business objectives. It attracts highly qualified
professionals from premier institutions such as IIMs, ICAI,
ICMAI, etc. ensuring a strong talent pool. New recruits
undergo a well-structured induction program that
provides comprehensive exposure to various functions
of the Corporation, including practical field visits, which
facilitate smooth onboarding and early engagement.

Throughout the year, continuous learning is encouraged
through targeted training programs. Your company
introduced E-Learning scheme to encourage self-paced
learning from renowned learning platforms. Special
emphasis is placed on behavioral and leadership
development initiatives for senior executives, including
Advanced Management and Leadership Programs,
to build a robust leadership pipeline and support
career progression. Your Company regularly conducts
employee engagement surveys to understand workforce
sentiments and address concerns through data-driven
interventions, resulting in a motivated and productive

work environment. These efforts have contributed to a
low attrition rate of 0.73% during FY 2024-25.

Your company recruited 10 new executives during
FY 2024-25. Additionally, industrial relations have
remained cordial and harmonious, reflecting the
employees' strong commitment to the Company's
objectives and the effectiveness of its human resource
management practices.

20. Corporate Vigilance: a Foundation of Trust

During the Financial Year 2024-25, the Vigilance Unit has
continued to serve as a vital instrument in supporting the
Corporation's integrity and efficiency. The Unit actively
pursued preventive vigilance by conducting regular and
surprise inspections across various departments. In
addition, it issued operational guidelines and instructions
aimed at streamlining systems and procedures, thereby
addressing potential vulnerabilities and reinforcing
transparency in daily operations.

Power Finance Corporation Limited (PFC) observed
Vigilance Awareness Week from October 28 to November
3, 2024, in alignment with the directives of the Central
Vigilance Commission (CVC). To mark the occasion,
banners promoting Vigilance Awareness Week were
prominently displayed at key locations within and outside
the office premises. The theme for this year, "Culture
of Integrity for Nation's Prosperity", was prominently
showcased, including on the desktop screens of all
employees. Additionally, extensive publicity was carried
out through social media platforms such as Facebook, X
(formerly Twitter), and Instagram. A dedicated link was
also provided on the Corporation's intranet and official
website to facilitate widespread participation in the online
Integrity Pledge (e-pledge).

As part of the week-long observance, the Vigilance
Unit organized a series of employee engagement
activities including slogan writing, poetry, and pictorial
competitions centered on vigilance-related themes.
These competitions were open to all regular employees,
including those stationed at regional offices, with the
objective of encouraging creativity and innovation in
promoting good governance.

As a new initiative, three dedicated portals were launched
by the dignitaries during the VAW event—Vendor
Grievance Redressal Portal, Vigilance Complaint Portal,
and Employee Grievance Redressal Portal—aimed at
enhancing transparency, accountability, and ease of
communication. Additionally, the revised and updated
edition of the Vigilance Manual was formally released,
reinforcing the Corporation's commitment to robust
vigilance practices. During this period, the Vigilance Unit
also undertook comprehensive investigations into the
complaints received, ensuring thorough examination and
appropriate follow-up actions.

In continuation of the broader three-month Vigilance
Awareness campaign (VAW-2024), several training and
sensitization programs were conducted:

•    Workshop on "Conduct, Discipline and Appeal Rules"
for PFC employees.

•    One-day refresher course on "Cyber Security and
Incident Response."

•    Two-day residential training program on "Sensitization
on Fraud Management and Staff Accountability"
for Internal Advisory Committee members and
relevant personnel.

•    Workshop on "Ethics and Governance" aimed at
reinforcing ethical standards across the Corporation.

Additionally, outreach meetings were held with vendors
of both PFC and PFCCL, reinforcing the Corporation's
commitment to transparency and ethical business
practices. To further enhance public engagement, the
CVC's jingle was broadcast on two major FM radio
channels—Red FM and Radio City—during evening prime
time slots.

I n adherence to CVC guidelines, sensitive posts within
the Corporation were identified and officers were
rotated regularly to ensure objectivity and reduce risk.
Furthermore, Agreed Lists and the List of Officers of
Doubtful Integrity for 2024 were prepared in consultation
with the Central Bureau of Investigation (CBI) for the
Corporate Office in Delhi and regional offices in Mumbai
and Chennai. All prescribed periodical statistical returns
were submitted to the CVC, CBI, and Ministry of Power
(MoP) within the stipulated timelines.

The Vigilance Unit continuously functioned for systemic
improvements with a view to increase transparency,
objectivity and accountability in the operations of
the corporation. Thus, it has contributed towards
strengthening in the functioning of the organization.

21. Implememtation of Official Language

PFC always gives utmost priority to Rajbhasha Hindi in all
its official working. It celebrated Hindi Day on September
14, 2024 and Hindi Month from September 14, 2024 to
October 13, 2024 successfully. Five (5) competitions, viz.
'Hindi Tippan evam Aalekhan', 'Chitra Kuchh Bolte Hain',
'Smaran Shakti Pratiyogita', 'Humse Badhkar Kaun' and
'Rajbhasha Prashnottari' (for Senior Executives) were
conducted during the Hindi Month to encourage and
motivate employees to continue working in Hindi.

During the year, Six (6) Hindi workshops were organized
on various topics in which 342 employees participated.

A Rajbhasha Sangoshthi was organized on March 17,
2025 on the subject "Bharat ke Bhashai Kshetra mein
Aatmanirbharta aur Hindi ki Bhumika" in which 38
employees participated.

Apart from the competitions held during the Hindi month,
Four (4) Hindi competitions, viz. 'Paheliyon ka Chakravyuh',
'Naara Lekhan', 'Nibandh Lekhan' and 'Shuddh Varti
Pratiyogita' were also conducted during the year in order
to promote the usage of Official Language in which 147
employees participated.

Review meetings with various units, Internal inspections
and Personal contact programme were conducted for the
purpose of reviewing the Rajbhasha related work being
done by these units and employees. To motivate the
employees towards Hindi, the book "Surykant Tripathi
ki Sampurna Kahaniyan" written by renowned poet and
writer Surykant Tripathi Nirala was distributed to all
the employees.

I nspection was carried out by the Ministry of Power on
November 07, 2024 regarding implementation of Official
Language in the Corporation and they appreciated the
efforts being made by PFC towards the same. Apart
from this, the inspection of Power Finance Corporation
Limited, Regional Office (South) Chennai, was successfully
conducted by the Parliamentary Committee on Official
Language on January 6, 2025.

The 59^th meeting of the Town Official Language
Implementation Committee (Undertaking-1, Delhi) was
held on August 9, 2024. In this meeting, Power Finance
Corporation was awarded for the Best Implementation of
Official Language Policy.

In the meeting of Town Official Language Implementation
Committee (Undertaking-1, Delhi) held onJanuary 21,2025,
your company was awarded for successfully organizing
the 'Hindi Kavita Paath Pratiyogita' on November 28, 2024.
A total of 24 participants from various Office members
of the committee participated in this competition. Along
with this, 03 employees of the Corporation won prizes in
various competitions organized by Town Official Language
Implementation Committee (Undertaking-1), Delhi during
October-December 2024.

Four (4) issues of the house journal, "Urja Deepti", were
published and uploaded on the PFC website as well as the
website of the Department of Official Language, Ministry
of Home Affairs.

In meetings of OLIC conducted under the chairmanship of
CMD, PFC, wherein CMD reviewed the Rajbhasha related
work in PFC and motivated the OLIC members to promote
Hindi in their area of working.

All these efforts acted as motivational tools for creating
possibilities of progressive use of Official Language in
the Corporation.

22. Directors' Responsibility Statement

As required under Section 134(5) of the Companies Act,
2013, it is confirmed that:

a)    in the preparation of the annual accounts, the
applicable accounting standards had been
followed along with proper explanation relating to
material departures;

b)    such accounting policies have been selected and
applied them consistently and made judgements
and estimates that are reasonable and prudent so
as to give a true and fair view of the state of affairs of
the Company at the end of the financial year and of
the profit and loss of the Company for that period;

c)    proper and sufficient care has been taken for the
maintenance of adequate accounting records
in accordance with the provisions of this Act for
safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities;

d)    the annual accounts have been prepared on a going
concern basis;

e)    internal financial controls have been laid to be
followed by the Company and such internal financial
controls were adequate and operating effectively;

f)    the Directors had devised proper systems to ensure
compliance with the provisions of all applicable
laws and that such systems were adequate and
operating effectively.

23. Auditors

i.    Statutory Auditors

M/s Thakur, Vaidyanath Aiyar & Co., Chartered Accountants
and M/s Mehra Goel & Co., Chartered Accountants were
appointed as Joint Statutory Auditors of the Company
for FY 2024-25 by the Office of the Comptroller & Auditor
General of India.

The Joint Statutory Auditors have audited the accounts of
the Company for the FY 2024-25 and have given their report
without any reservation, adverse remark or disclaimer.
The copy of the audit report is annexed herewith.

Maintenance of cost records as specified by the Central
Government under sub-section (1) of section 148 of the
Companies Act, 2013, is required by the Company and
accordingly such accounts and records are made and
maintained, is not applicable on the company.

ii.    Secretarial Auditor:

Your Company had engaged M/s. Mehta & Mehta,
Company Secretaries as Secretarial Auditors for
FY 2024-25. Secretarial Audit Report is annexed herewith.

The observations of the Secretarial Auditor and reply of
the management on the observations, for the FY 2024-25
along with copy of the audit report is annexed herewith.

iii.    Comments of Comptroller & Auditor General
of India

The Comptroller and Auditor General of India (C&AG)
has mentioned that on the basis of audit, nothing
significant has come to their knowledge which would give

rise to any comment upon or supplement to Statutory
Auditors' report. The copy of the report of C&AG is
annexed herewith.

24.    Streamlining Governance Through Technology

I n today's rapidly evolving landscape, our organization
has significantly advanced its governance practices
by strategically leveraging technology. This digital
transformation has been instrumental in enhancing
efficiency, transparency, and accountability across
all operational facets. By implementing robust digital
platforms and tools, we have streamlined decision-making
processes, automated routine tasks, and improved real¬
time data accessibility for stakeholders. Our initiatives
have focused on secure digital record-keeping, virtual
collaboration tools for board and committee meetings etc.

Pursuant to the Companies Act, 2013, the Companies
are permitted to send documents like Notice of Annual
General Meeting, Annual Report etc. through electronic
means to its members at their registered email addresses.
PFC, being a socially responsive Company actively
supports the implementation of 'Green Initiative' of
the Ministry of Corporate Affairs (MCA). Your Company
has effected electronic delivery of Notices and Annual
Reports to shareholders, whose email ids are registered.
Further, pursuant to Section 108 of the Companies Act,
2013 read with Rule 20 of the Companies (Management
and Administration) Rules, 2014, the Company is
providing e-voting facility to all members to enable them
to cast their votes electronically in respect of resolutions
set forth in postal ballot and Annual General Meeting
(AGM). The Company also conducts the AGM through
video conferencing / other audio-visual means. Members
can refer to the detailed instructions for e-voting and
electronic participation in the AGM, as provided in the
Notice of AGM.

25.    Statutory Disclosures

i.    Deposits

Your Company is a non-deposit taking NBFC, and thus has
not accepted any public deposits during the FY 2024-25
and the Board of Directors of the Company has passed
requisite resolution in this regard, in compliance of RBI
Guidelines. Further, no Perpetual Debt Instruments (PDI)
was issued by your company during FY 2024-25.

The outstanding balance of PDI is H100 crore as on March
31, 2025. The Interest payment on PDI has been made on
time on the due date.

As on March 31, 2025, the PDI to Tier-1 capital is 0.13%
and is appearing in notes to accounts Note no. 39.1 of
the standalone financial statements forming part of this
Annual Report.

ii.    Material order

No significant and material orders were passed by any
regulator or court or tribunal impacting the going concern
status and company's operations during the FY 2024-25.

iii.    Adequate system of Internal Control

The Company maintains an adequate system of Internal
Control, including suitable monitoring procedures to
ensure accurate and timely financial reporting of various
transactions, efficiency of operations and compliance with
statutory laws, regulations and Company procedures/
policies. For details, please refer to the 'Management
Discussion and Analysis Report' annexed to this report.

iv.    Report on Corporate Governance

Information on composition, terms of reference and
number of meetings of the Board and its Committees
held during the year, Whistle Blower Policy, remuneration
to Whole time Directors, sitting fees to Independent
Directors and details regarding IEPF and web-links for
familiarization programmes of Directors, Policy on
Materiality of Related Party Transactions and Dealing with
Related Party Transactions, Policy for determining Material
Subsidiaries, etc. have been provided in the 'Report on
Corporate Governance', prepared in compliance with
the provisions of SEBI (LODR) Regulations, 2015 and DPE
Guidelines on Corporate Governance, 2010, as amended
from time to time, which forms part of this Annual Report.

v.    Presidential Directives

During last 3 years, there has been no Presidential
Directive.

vi.    Loan. Guarantee and Investment

Pursuant to Section 186(11) of the Companies Act, 2013,
loans made, guarantees given, securities provided or
investment made by a company engaged in the business
of financing of companies or of providing infrastructural
facilities in the ordinary course of its business are not
applicable to the Company, hence no disclosure is
required to be made. Further, details of investments are
appearing at note no.11 of the Notes to Accounts of the
standalone financial statements.

vii.    Managerial Remuneration

The provisions of Section 197 of the Companies Act,
2013 and Rules made thereunder relating to managerial
remuneration are not applicable to Government
companies, therefore no disclosure is required to
be made.

viii.    Stock options

The Company has not issued any stock options to the
Directors or any employee of the Company during the
FY 2024-25.

ix.    Cost accounts and records

The Central Government has not prescribed the
maintenance of cost records for the products/services
of the Company under the Companies (Cost Records and
Audit) Rules, 2014 read with the Companies (Cost Records
and Audit) Amendment Rules, 2014 prescribed by the
Central Government under Section 148 of the Companies

Act, 2013. Accordingly, cost accounts and records are not
required to be maintained by the Company.

x.    Fraud

During the year under review, neither the statutory
auditors nor the secretarial auditor has reported to the
audit committee, under Section 143(12) of the Companies
Act, 2013, any instances of fraud committed against PFC
by its officers or employees.

xi.    Secretarial Standards

The Company is compliant with the applicable Secretarial
Standards issued by the Institute of Company Secretaries
of India.

xii.    Independent Directors

The Independent Directors of the Company are appointed
by the President of India acting through the administrative
ministry, i.e., MoP. Accordingly, the appointing authority
considers the integrity, expertise and experience of the
individual to be appointed.

In the FY 2024-25, three Independent Directors on
completion of their tenure, ceased to be part of the Board
of PFC. No new Independent Director was appointed on
the Board of PFC during the FY 2024-25.

Subsequently, in the first quarter of FY 2025-26, Ministry
of Power, Government of India appointed/ reappointed
five Independent Directors (including one Independent
Women Director) viz. Smt. Usha Sajeev Nair, Shri Prasanna
Tantri, Shri Naresh Dhanrajbhai Kella w.e.f. April 17, 2025
and Shri Bhaskar Bhattacharya & Dr. Sudhir Mehta w.e.f.
May 13, 2025 & May 14, 2025 respectively.

xiii.    Conservation of Energy and Technology
Absorption

There are no significant particulars, relating to
conservation of energy and technology absorption as
your Company does not own any manufacturing facility.

xiv.    Foreign exchange earnings and outgo

The Foreign exchange outgo for the FY 2024-25 aggregated
to H14,796.34 crore. The payments are majorly for the
purpose of servicing principal and interest component
of foreign currency borrowings. The Foreign exchange
earnings for the FY 2024-25 were nil.

xv.    Total expenditure for the FY 2024-25 amounted to
H31,955.39 crore as against total expenditure of H28,408.41
crore in FY 2023-24. Out of it, finance cost amounted to
H30,538.04 crore in FY 2024-25 as compared to H28,013.78
crore in FY 2023-24. During FY 2024-25, employee benefit
expenses and other expenses were H268.58 crore and
H162.68 crore respectively against H242.72 crore and
H166.11 crore respectively in the previous year.

xvi.    M/s. ASA & Associates LLP, Chartered Accountants,
appointed for testing adequacy and operative
effectiveness of Internal financial control over financial
reporting, has certified that the Company maintains

an adequate system of internal financial controls,
evaluates and makes an assessment of its adequacy and
effectiveness in a satisfactory manner which takes care of
requirements under Companies Act, 2013.

The Statutory Auditors of the Company i.e. Thakur,
Vaidyanath Aiyar & Co., Chartered Accountants and
Mehra Goel & Co., Chartered Accountants have also given
their Report on Internal Financial Controls stating that the
Company has, in all material respects, internal financial
controls system over financial reporting and such internal
financial controls over financial reporting were operating
effectively as at March 31, 2025 based on internal
control over financial reporting 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.

xvii.    Annual Return

The Annual Return of PFC for FY 2023-24 is available
on the link https://www.pfcindia.com/ensite/Home/
VS/10256 and for FY 2024-25 it shall be made available on
your Company's website www.pfcindia.co.in.

xviii.    Debenture trustees

The details of Debenture trustees appointed by the
company for the different series of Bonds issued by your
company are annexed herewith.

xix.    Insolvency and Bankruptcy Code, 2016

During the year no application has been made or any
proceedings pending against PFC under the Insolvency
and Bankruptcy Code, 2016. Further, details of the
difference between amount of the valuation done at the
time of one time settlement and the valuation done while
taking loan from the banks or financial institutions, are
not applicable.

xx. Procurement from Micro & Small Enterprises

Government of India has notified Public Procurement
Policy for Micro and Small Enterprises (MSEs) Order, 2012
to support marketing of products produced and services
rendered by them. In compliance to the policy, annual
procurement plan including items to be procured from
Micro & Small Enterprises (MSEs) are uploaded on PFC's
website for the benefit of MSEs.

The benefits to MSEs like exemption from tender fees and
earnest money deposit, purchase preference, interest on
delayed payments and exemption from prior experience
- prior turnover criteria subject to meeting of quality and
technical specifications are also extended to encourage
these enterprises.

During the financial year, your company has made all
the payments against invoices of MSE vendors within
the prescribed timelines, and invoices of MSE vendors
pending for payment beyond prescribed timelines at the
end of the financial year is Nil.

During the financial year, your Company has procured
products and services from MSEs, which constituted
42.12 % of the total annual procurement value, against
the mandate of 25 % set by Ministry of Micro, Small and
Medium Enterprises, Govt. of India. During the year, 356
MSEs were benefited out of which 21 MSEs belonged to
SC/ST category and 72 MSEs were owned by women.

PFC is also registered on four Trade Receivables
Discounting System (TReDS) platform (i.e. Receivables
Exchange of India Ltd (RXIL), M1xchange, Invoicemart,
and C2FO) for financing of trade receivables of Micro,
Small & Medium Enterprises (MSMEs). TReDS platform
facilitates the discounting of invoices of MSMEs leading
to prompt generation of working capital for their regular
business operations.

Your Company had also organized/participated in 02
vendor development programmes in co-ordination
with Ministry of Micro, Small and Medium Enterprises,
Govt. of India to encourage participation of Micro and
Small Enterprises.

xxi. Compliance of the provisions relating to the
Maternity Benefit Act, 1961

Your company adheres to the obligations in terms of paid
leave and other facilities mandated under the Maternity
Benefit Act, hence creating a supportive and equitable
workplace environment. Your company reaffirms its
commitment to protecting the rights and well-being of its
women employees.

In addition to this, to facilitate women employees to take
care of the needs of their minor children during their
examination, sickness, etc., a provision of Child Care Leave
(CCL) is in place for a maximum period of 2 years (730 days)
to be availed during their entire service in the Corporation.

26. Information Technology Initiatives

The PFC IT Unit promotes effective stewardship of
information access and provides a secure, reliable
technology infrastructure for customer oriented services
and support, so as to meet the ever changing business
needs. Accordingly, PFC has undertaken many Information
Technology (IT) initiatives to help streamline operations,
improve efficiency, optimise resource utilization and
devote talent to core business to enable better services
and relationship with stakeholders.

IT Governance Structure:

A robust IT governance structure has been established
at PFC to ensure strict adherence to the necessary
compliance to the guidelines prescribed by various
statutory and regulatory bodies. PFC also has BoD
approved IT policy in-line with RBI master directions.

IT Strategy Committee (ITSC):

As per the recent RBI Master Direction on Information
Technology Governance, Risk, Controls and Assurance
Practices, a Board Level ITSC, has been constituted in
PFC to ensure that the IT Strategy aligns with the overall
strategy of the organization towards accomplishment
of its business objectives. ITSC is headed by an
Independent Director.

IT Steering Committee:

In line with the Reserve Bank of India's Master Directions
for NBFCs, the IT Steering Committee have been duly
constituted and regular meetings are conducted to
oversee the execution of IT Strategy and ensure that
necessary IT risk management processes are in place.

Head of IT Function (HoF):

"Head of IT Function" bas been nominated at PFC.
HoF is managing the Information Technology setup
while planning, giving technical oversight, managing IT
compliances and resources.

Chief Information Security Officer (CISO):

CISO has been nominated at PFC. CISO is involved in
information security strategy and ensuring compliance
to the extant regulatory/ statutory instructions on
information/ cyber security.

Information Security Committee (ISC):

In line with RBI Master Directions, an Information
Security Committee (ISC), under the oversight of the
ITSC, has been formed for managing information
security for development of information security policies,
implementation of policies, standards and procedures to
ensure that all identified risks are managed.

Regulatory & Statutory Requirements:

PFC comply with RBI guidelines/master directions and
follows advisories and cybersecurity directives applicable
to it is issued by the Ministry of Power (MoP), CERT-In to
ensure robust security for its IT infrastructure and critical
financial systems. In case any incident happens, the same
is reported to RBI, Cert-IN and CSIRT of MoP.

PFC Datacenter:

In order to provide technological support through IT
infrastructures, PFC established a Datacenter at its
headquarter at Delhi seismic zone (IV), which is operational
24x7, housing Database, Applications, Network, Email,
Antivirus, Cyber security systems etc.

Business Applications:

PFC has implemented software applications to cater
its business requirement integrating its core business
activities. Major applications are "Project Appraisal &
Management System", "Loan Accounting & Management
System", "Resource Mobilization" , "Oracle ERP eBusiness
suite for Financial Accounting", "Human Resource
Management System" and Payroll.

Automation of Business Processes &
Paperless Office:

PFC remains steadfast in harnessing Information
Technologyto empower its employeesin efficientlyfulfilling
business functions. Implementation of collaboration tools
for online meetings, adoption of an e-Office solution for
streamlined file processing, conducting paperless digital
board meetings through BoardPac, and transitioning
to paperless employee claims are among the initiatives
undertaken by PFC to enhance organizational efficiency
through technological utilization.

PFC Website:

The bi-lingual PFC website is maintained with up-to-date
information as per "Guidelines for Indian Government
Websites". The website is hosted on NIC.

Cyber Security:

PFC is committed to work towards aligning itself with the
changing threat landscape. PFC ensures 24x7 real-time
monitoring of its IT infrastructure to promptly detect &
alert. This proactive approach helps minimize service
disruptions and ensures high availability of critical
systems and services. PFC observes "Cyber Jagarukta
Diwas" on the first Wednesday of every month to raise
awareness about cyber security among its users.

PFC - IT Cyber Security Policy:

The objective of the IT Cyber Security Policy is to establish
a comprehensive framework to safeguard PFC's IT
systems and digital assets to maintain confidentiality,
integrity, and availability of PFC's IT systems and data.
Areas covered under Cyber security policy include:

•    Network and Cyber Security

•    Server Security

•    Application Security

•    Logging, Monitoring, and Reporting

•    Security Review

Multi Factor Authentication (MFA):

To enhance security, comply with RBI guidelines, and
safeguard PFC users from emerging cyber threats,
Multi-Factor Authentication (MFA) has been successfully
implemented across the organization. MFA has been
introduced as an additional layer of security to reinforce
the organization's cybersecurity posture. This additional
layer of security ensures more robust protection against
unauthorized access.

Business Continuity & Disaster Recovery:

A Disaster Recovery (DR) site has been established on a
cloud platform, replicating the existing data centre setup
at Mumbai in a different seismic zone (III) to seamlessly
continue its business operations in the event of a disaster.
Further, PFC conducts Disaster Recovery (DR) drills half
yearly to ensure organizational readiness in the face of
unexpected disruptions or disasters. These drills are
vital for testing the effectiveness of the DR, identifying
potential gaps, and enhancing the organization's ability to
respond swiftly and efficiently during critical situations.

27.    Establishment of Vigil Mechanism

Your Company has established stringent vigil mechanism
by way of implementing various codes and policies like fair
practices code, code of conduct, code for prevention of
insider trading, fraud prevention policy, policy on related
party transactions, public procurement policy, whistle
blower policy, etc. The details are also posted on the
Corporation's website.

28.    Grievance Redressal

PFC has a Grievance Redressal System for dealing with
grievances of the public at large. The status of the Public
grievances are also available in PFC web portal under
public domain. The link for accessing the same is as
under:-

https://www.pfcindia.co.in/ensite/DocumentRepository/
ckfinder/files/Statutory Requirements/Status of Public
Grievances/CPGRAMS%20Report-Q1%20FY25-26.pdf

The systems are duly notified and the Nodal Officers ensure
quick redressal of grievances within the permissible time
frame. PFC has also notified Citizen's Charter to ensure
transparency in its work activities. The Charter is available
on the website of PFC to facilitate easy access.

29. Statutory and other Information

Information required to be furnished as per the Companies
Act, 2013, Securities and Exchange Board of India (Listing
Obligations and Disclosure Requirements) Regulations,
2015, DPE's Guidelines on Corporate Governance for
CPSEs and other applicable statutory provisions is
annexed to this report as follows:

ACKNOWLEDGEMENT

Your Directors are highly grateful for the valuable support,
cooperation, and encouragement extended to the Company by
the Government of India—particularly the Ministry of Power,
Ministry of Finance, Ministry of Corporate Affairs, various State
Governments, the Reserve Bank of India, Department of Public
Enterprises, NITI Aayog, DIPAM, Securities and Exchange Board
of India, National Stock Exchange of India Limited, BSE Limited,
Ministry of Micro, Small and Medium Enterprises, and other
relevant government departments and agencies at both Central
and State levels. Your Directors acknowledge the constructive
suggestions received from Auditors and Comptroller and
Auditor General of India and are grateful for their continued
support and cooperation.

The Company also extends its gratitude to the Statutory
Auditors, Secretarial Auditor, RBI Auditors, and its bankers for
their valuable insights, guidance, and continued cooperation.

The Directors further wish to convey their heartfelt thanks to
the shareholders, investors, clients, and customers for their
steadfast trust and support. Lastly, the Board acknowledges
all members of the PFC Family for the unstinting efforts and
dedicated contributions put in by the PFCians at all levels to
ensure that the Company continues to sustain and grow.

Sd/-

(Parminder Chopra)

Chairman and Managing Director
DIN:08530587

Dated: August 06, 2025

1

   Consistent engagement on Facebook, LinkedIn, and
X (formerly Twitter), especially around CSR initiatives,
exhibitions, and national observances.

•    Focused campaigns on key themes like energy
conservation, Swachhta campaign, smart energy
usage, and public health awareness.

•    Media recognition through awards such as the CSR
Champion Award at the Outlook Planet Sustainability
Summit 2024.