m) Provisions, contingent assets and contingent
liabilities

Provisions are recognized only when there is a present
obligation, as a result of past events, and when a
reliable estimate of the amount of obligation can
be made at the reporting date. These estimates are
reviewed at each reporting date and adjusted to reflect
the current best estimates. Provisions are discounted
to their present values, where the time value of money
is material.

Contingent liability is disclosed for:

• Possible obligations which will be confirmed only
by future events not wholly within the control of
the Company or

• Present obligations arising from past events where
it is not probable that an outflow of resources will
be required to settle the obligation or a reliable
estimate of the amount of the obligation cannot
be made.

Contingent assets are not recognized but disclosed
where an inflow of economic benefits is probable.

n) Leases

Company as a lessee

A lease is defined as 'a contract, or part of a contract, that
conveys the right to use an asset (the underlying asset)
for a period of time in exchange for consideration’. To
apply this definition the Company assesses whether

the contract meets three key evaluations which are
whether:

• the contract contains an identified asset, which
is either explicitly identified in the contract or
implicitly specified by being identified at the time
the asset is made available to the Company

• the Company has the right to obtain substantially
all of the economic benefits from use of the
identified asset throughout the period of use,
considering its rights within the defined scope of
the contract the Company has the right to direct
the use of the identified asset throughout the
period of use.

The Company assess whether it has the right to
direct 'how and for what purpose’ the asset is used
throughout the period of use.

At lease commencement date, the Company
recognizes a right-of-use asset and a lease liability on
the balance sheet. The right-of-use asset is measured
at cost, which is made up of the initial measurement
of the lease liability, any initial direct costs incurred by
the Company, an estimate of any costs to dismantle
and remove the asset at the end of the lease, and
any lease payments made in advance of the lease
commencement date (net of any incentives received).
The Company depreciates the right-of-use assets on a
straight-line basis from the lease commencement date
to the earlier of the end of the useful life of the right-of-
use asset or the end of the lease term. The Company
also assesses the right-of-use asset for impairment
when such indicators exist.

At the commencement date, the Company measures
the lease liability at the present value of the lease
payments unpaid at that date, discounted using the
interest rate implicit in the lease if that rate is readily
available or the Company’s incremental borrowing rate.
Subsequent to initial measurement, the liability will
be reduced for payments made and increased for
interest. It is remeasured to reflect any reassessment
or modification, or if there are changes in in-substance
fixed payments. When the lease liability is remeasured,
the corresponding adjustment is reflected in the right-
of-use asset, or profit and loss if the right-of-use asset
is already reduced to zero.

The Company has elected to account for short-term
leases and leases of low-value assets using the
practical expedients. Instead of recognising a right-of-
use asset and lease liability, the payments in relation to
these are recognized as an expense in profit or loss on
a straight-line basis over the lease term.

Determining the lease term of contracts with renewal
and termination options where Company is lessee

The Company determines the lease term as the
non-cancellable term of the lease, together with any
periods covered by an option to extend the lease if it
is reasonably certain to be exercised, or any periods
covered by an option to terminate the lease, if it is
reasonably certain not to be exercised.

The Company has several lease contracts that include
extension and termination options. The Company
applies judgement in evaluating whether it is reasonably
certain whether or not to exercise the option to renew
or terminate the lease. That is, it considers all relevant
factors that create an economic incentive for it to
exercise either the renewal or termination.

o) Financial instruments

A Financial instrument is any contract that gives rise to
a financial asset of one entity and a financial liability or
equity instrument of another entity.

Initial recognition and measurement
Financial assets and financial liabilities are recognized
when the Company becomes a party to the contractual
provisions of the financial instrument and are
measured initially at fair value adjusted for transaction
costs. Subsequent measurement of financial assets
and financial liabilities is described below.
Non-derivative financial assets
Subsequent measurement

i. Financial assets carried at amortized cost - a

financial asset is measured at the amortized cost
if both the following conditions are met:

• The asset is held within a business model
whose objective is to hold assets for
collecting contractual cash flows, and

• Contractual terms of the asset give rise on
specified dates to cash flows that are solely
payments of principal and interest (SPPI) on
the principal amount outstanding.

After initial measurement, such financial assets
are subsequently measured at amortized cost
using the effective interest rate (EIR) method.
Amortized cost is calculated by taking into
account any discount or premium on acquisition
and fees or costs that are an integral part of the
EIR. The EIR amortization is included in interest
income in the Statement of Profit and Loss.

ii. Financial assets are measured at FVOCI: - a
financial asset is measured at the FVOCI if both
the following conditions are met:

• The instrument is held within a business
model, the objective of which is achieved by
both collecting contractual cash flows and
selling financial assets

• The contractual terms of the financial asset
meet the SPPI test

FVOCI debt instruments are subsequently
measured at fair value with gains and losses
arising due to changes in fair value recognized
in OCI. Interest income are recognized in profit or
loss in the same manner as for financial assets
measured at amortized cost.

Investment in security receipts issued by trust
floated by asset reconstruction companies
are accounted for at fair value through other
comprehensive income (FVOCI).

iii. Investments in equity instruments - Investments
in equity instruments which are held for trading
are classified as at fair value through profit or
loss (FVTPL). For all other equity instruments,
the Company makes an irrevocable choice upon
initial recognition, on an instrument by instrument
basis, to classify the same either as at fair value
through other comprehensive income (FVOCI) or
fair value through profit or loss (FVTPL). Amounts
presented in other comprehensive income are
not subsequently transferred to profit or loss.
However, the Company transfers the cumulative
gain or loss within equity. Dividends on such
investments are recognized in profit or loss unless
the dividend clearly represents a recovery of part
of the cost of the investment.

iv. Investments in mutual funds - Investments in
mutual funds are measured at fair value through
profit and loss (FVTPL).

v. Financial assets measured at FVTPL - FVTPL

is a residual category for debt instruments. Any
debt instrument, which does not meet the criteria
for categorization as at amortized cost or as
FVTOCI, is classified as at FVTPL, with all changes
recognized in profit and loss.

De-recognition of financial assets
Financial assets (or where applicable, a part of financial
asset or part of a group of similar financial assets)
are de-recognized (i.e. removed from the Company’s
balance sheet) when the contractual rights to receive
the cash flows from the financial asset have expired, or
when the financial asset and substantially all the risks
and rewards are transferred. Further, if the Company
has not retained control, it shall also de-recognize the

financial asset and recognize separately as assets or
liabilities any rights and obligations created or retained
in the transfer.

Non-derivative financial liabilities

Subsequent measurement

Subsequent to initial recognition, all non-derivative
financial liabilities are measured at amortized cost
using the effective interest method.

De-recognition of financial liabilities

A financial liability is de-recognized when the obligation
under the liability is discharged or cancelled or expired.
When an existing financial liability is replaced by another
from the same lender on substantially different terms,
or the terms of an existing liability are substantially
modified, such an exchange or modification is treated
as the de-recognition of the original liability and the
recognition of a new liability. The difference in the
respective carrying amounts is recognized in the
Statement of Profit and Loss.

Financial Guarantees

Financial guarantees are initially recognized at fair
value. Subsequently, the liability is measured at the
higher of the amount of loss allowance determined as
per impairment requirements of Ind AS 109 and the
amount recognized less cumulative amortization.

The premium received (if any) is recognized as income
on a straight-line basis over the life of the guarantee.
Offsetting of financial instruments
Financial assets and financial liabilities are offset
and the net amount is reported in the balance sheet
if there is a currently enforceable legal right to offset
the recognized amounts and there is an intention to
settle on a net basis, to realize the assets and settle the
liabilities simultaneously.

Derivative contracts

The Company enters into certain derivative contracts
to hedge risks which are not designated as hedges.
Such contracts are accounted for at fair value through
profit and loss using mark to market information.

Fair value measurement

The Company measures financial instruments at
fair value at each balance sheet date using valuation
techniques. Fair value is the price that would be
received to sell an asset or paid to transfer a liability in
an orderly transaction between market participants at
the measurement date. The fair value measurement is
based on the presumption that the transaction to sell
the asset or transfer the liability takes place either:

a) In the principal market for the asset or liability, or

b) In the absence of a principal market, in the most
advantageous market for the asset or liability.

The Company uses valuation techniques that are
appropriate in the circumstances and for which
sufficient data are available to measure fair value,
maximizing the use of relevant observable inputs and
minimizing the use of unobservable inputs. All assets
and liabilities for which fair value is measured are
categorized with fair value hierachy into Level I, Level II
and Level III based on level of input.

p) Foreign currency

Functional and presentation currency

Items included in the financial statement of the
Company are measured using the currency of the
primary economic environment in which the entity
operates ('the functional currency’). The financial
statements have been prepared and presented in Indian
Rupees (INR), which is the Company’s functional and
presentation currency.

Transactions and balances

Foreign currency transactions are translated into
the functional currency, by applying the exchange
rates on the foreign currency amounts at the date of
the transaction. Foreign currency monetary items
outstanding at the balance sheet date are converted
to functional currency using the closing rate. Non¬
monetary items denominated in a foreign currency
which are carried at historical cost are reported using
the exchange rate at the date of the transaction.
Exchange differences arising on monetary items on
settlement, or restatement as at reporting date, at
rates different from those at which they were initially
recorded, are recognized in the Statement of Profit and
Loss in the year in which they arise.

q) Significant management judgement in applying
accounting policies and estimation uncertainty

The preparation of the Company’s financial statements
requires management to make judgements, estimates
and assumptions that affect the reported amounts
of revenues, expenses, assets and liabilities, and the
related disclosures. Actual results may differ from
these estimates.

Significant management judgements
Recognition of deferred tax assets - The extent to
which deferred tax assets can be recognized is based
on an assessment of the probability of the future
taxable income against which the deferred tax assets
can be utilized.

Business model assessment - The Company
determines the business model at a level that reflects
how groups of financial assets are managed together
to achieve a particular business objective. This
assessment includes judgement reflecting all relevant
evidence including how the performance of the assets
is evaluated and their performance measured, the risks
that affect the performance of the assets and how these
are managed and how the managers of the assets are
compensated. The Company monitors financial assets
measured at amortized cost that are derecognized
prior to their maturity to understand the reason for their
disposal and whether the reasons are consistent with
the objective of the business for which the asset was
held. Monitoring is part of the Company’s continuous
assessment of whether the business model for which
the remaining financial assets are held continues to be
appropriate and if it is not appropriate whether there
has been a change in business model and accordingly
prospective change to the classification of those
assets are made.

Evaluation of indicators for impairment of assets

- The evaluation of applicability of indicators of
impairment of assets requires assessment of several
external and internal factors which could result in
deterioration of recoverable amount of the assets.

Expected credit loss (‘ECL') - The measurement of
expected credit loss allowance for financial assets
measured at amortized cost requires use of complex
models and significant assumptions about future
economic conditions and credit behaviour (e.g.
likelihood of customers defaulting and resulting
losses). The Company makes significant judgements
with regard to the following while assessing expected
credit loss:

• Determining criteria for significant increase in
credit risk;

• Establishing the number and relative weightings
of forward-looking scenarios for each type of
product/market and the associated ECL; and

• Establishing groups of similar financial assets for
the purposes of measuring ECL.

Provisions - At each balance sheet date basis of the
management judgment, changes in facts and legal
aspects, the Company assesses the requirement
of provisions against the outstanding contingent
liabilities. However, the actual future outcome may be
different from this judgement.

Significant estimates

Useful lives of depreciable/amortizable assets -

Management reviews its estimate of the useful lives
of depreciable/amortizable assets at each reporting
date, based on the expected utility of the assets.
Uncertainties in these estimates relate to technical and
economic obsolescence that may change the utility of
assets.

Defined benefit obligation (DBO) - Management s
estimate of the DBO is based on a number of underlying
assumptions such as standard rates of inflation,
mortality, discount rate and anticipation of future
salary increases. Variation in these assumptions may
significantly impact the DBO amount and the annual
defined benefit expenses.

Fair value measurements - Management applies
valuation techniques to determine the fair value of

financial instruments (where active market quotes are
not available). This involves developing estimates and
assumptions consistent with how market participants
would price the instrument.

r) Statement of Cash Flows

Statement of Cash Flows is prepared segregating the
cash flows into operating, investing and financing
activities. Cash flow from operating activities is
reported using indirect method adjusting the net profit
for the effects of:

I. Changes during the period in operating receivables
and payables transactions of a non-cash nature;

II. Non-cash items such as depreciation, provisions,
deferred taxes, unrealized foreign currency gains
and losses; and

III. All other items for which the cash effects are
investing or financing cash flows.

^: i) During the year ended March 31, 2024, pursuant to the approval accorded by the Board of Directors of the

Company ("the Board"), at its meeting held on October 19, 2023 and the special resolution passed by the
shareholders of the Company at the Extra Ordinary General Meeting (EGM) held on November 27, 2023, the
Fund Raising Committee of the Board at its meeting held on December 14, 2023 had approved the Qualified
Institutions Placement of equity shares of face value of INR 10 each of the Company.

Subsequently, the Fund Raising Committee at its meeting held on December 19, 2023 had approved the allotment
of 1,08,36,584 equity shares of face value of INR 10 each to eligible qualified institutional buyers at the issue
price of INR 230.70 per equity share (including a premium of INR 220.70 per equity share) aggregating to INR
25,000.00 Lakh.

ii) During the year ended March 31,2024, the Company has allotted 1,44,10,256 equity shares of face value of INR
10/- each to Trishashna Holdings & Investments Private Ltd’ (THIPL) (entity belonging to promoter group) and
Florintree Ventures LLP (entity belonging to non-promoter group) pursuant to conversion of Fully Convertible
Warrants of INR 10 each at issue price of INR 81.25 per warrant including premium of INR 71.25 per warrant.

Nature and purpose of other reserve
Capital redemption reserve

The same had been created in accordance with provisions of the Companies Act 2013 on account of redemption of
preference shares.

Share options outstanding account

The reserve is used to recognize the fair value of the options granted to employees of the Company and subsidiary
companies under the Company’s employees stock option plans.

Statutory reserve

The reserve is created as per the provision of Section 45(IC) of the Reserve Bank of India Act, 1934. This is a restricted
reserve and no appropriation can be made from this reserve fund except for the purpose as may be prescribed by the
Reserve Bank of India.

General reserve

The Management has transferred a portion of the net profit to general reserve before declaring dividend pursuant to the
provision of erstwhile Companies Act.

Securities premium

Securities premium represents premium received on issue of shares. The amount is utilised in accordance with the
provisions of the Companies Act, 2013.

Retained earnings

This represents undistributed accumulated earnings of the Company as on the balance sheet date.

Equity instruments through other comprehensive income

This represents the cumulative gains and losses arising on the fair valuation of equity instruments measured at fair value
through other comprehensive income.

Changes in fair value of loan assets

This represents the cumulative gains and losses arising on the fair valuation of loan assets classified under business
model of hold and hold to collect and sell.

B Fair values hierarchy

Financial assets and financial liabilities are measured at fair value in the financial statements and are grouped into
three levels of a fair value hierarchy. The three levels are defined based on the observability of significant inputs to the
measurement, as follows:

The categories used are as follows:

Level 1: Quoted prices (unadjusted) for identical instruments in an active market;

Level 2: Directly (i.e. as prices) or indirectly (i.e. derived from prices) observable market inputs, other than Level 1
inputs; and

Level 3: Inputs which are not based on observable market data (unobservable inputs).

Valuation technique used to determine fair value

The fair value of a financial instrument on initial recognition is normally the transaction price (fair value of the
consideration given or received). Subsequent to initial recognition, the Company determines the fair value of financial
instruments that are quoted in active markets using the quoted bid prices (financial assets held) or quoted ask
prices (financial liabilities held) and using valuation techniques for other instruments. Valuation techniques include
discounted cash flow method, market comparable method, recent transactions happened in the Company and other
valuation models. The Company uses valuation techniques that are appropriate in the circumstances and for which
sufficient data is available to measure fair value, maximising the use of relevant observable inputs and minimising the
use of unobservable inputs.

(c) The value of derivative contracts are determined using mark to market value shared by contracting bank at
balance sheet date.

(d) The use of net asset value for security receipts on the basis of the value declared by investee party.

(e) The use of net asset value for government securities on the basis of the value declared by government.

(f) The use of valuation report obtained from registered valuer for investment in subsidiaries.

B.2 Fair value of instruments measured at amortized cost

Fair value of instruments measured at amortized cost for which fair value is disclosed is as follows, these fair
values are calculated using Level 3 inputs:

Valuation process and technique used to determine fair value

Specific valuation techniques used to value financial instruments include:

(a) Eligible loans valued by discounting the aggregate future cash flows (both principal and interest cash flows)
with discount rate that commensurate with the risk inherent in the expected cash flows for the remaining
portfolio tenor.

(b) The use of net asset value for certificate of deposits and mutual funds on the basis of the statement
received from investee party.

The management assessed that fair values of cash and cash equivalents, other bank balances, trade receivables,
other financial assets, trade payables, other payables and other financial liabilities approximate their respective
carrying amounts, largely due to the short-term maturities of these instruments. The following methods and
assumptions were used to estimate the fair values for other assets and liabilities:

(i) The fair values of the Company’s fixed interest bearing loans are determined by applying set of discount
rates and then averaged out to arrive at the fair value.

(ii) The fair values of the Company’s fixed rate interest-bearing debt securities, borrowings and subordinated
liabilities are determined by applying discount rate that reflects the issuer’s borrowing rate as at the end
of the reporting period. For variable rate interest-bearing debt securities, borrowings and subordinated
liabilities, carrying value represent best estimate of their fair value as these are subject to changes in
underlying interest rate indices as and when the changes happen.

44 | FINANCIAL RISK MANAGEMENT
i) Risk Management

The Company’s activities expose it to market risk, liquidity risk and credit risk. The Company’s board
overall responsibility for the establishment and oversight of the Company risk management framewori
manages the risk basis policies approved by the board of directors. The board of directors provide
overall risk management. This note explains the sources of risk which the entity is exposed to anc
manages the risk and the related impact in the financial statements.

Risk Exposure arising from Measurement Risk manageme

Credit risk Cash and cash equivalents Credit limit, ageing Highly rated bar

(excluding cash on hand), other analysis, default rate, diversification i

In order to avoid excessive concentration of risk, the Company’s policies and procedures include specific guidelines
to focus on maintaining a diversified portfolio. Identified concentrations of credit risks are controlled and managed
accordingly.

A) Credit risk

Credit risk is the risk that the Company will incur a loss because its customers or counterparties fail to discharge their
contractual obligations. The Company’s exposure to credit risk is influenced mainly by cash and cash equivalents, other
bank balances, investments, loan assets, trade receivables and other financial assets. The Company continuously
monitors defaults of customers and other counterparties and incorporates this information into its credit risk controls.
a) Credit risk management

Based on business environment in which the Company operates, a default on a financial asset is considered
when the counter party fails to make payments within the agreed time period as per contract. The Company
assesses and manages credit risk based on internal credit rating system. Internal credit rating is performed for
each class of financial instruments with different characteristics. The Company has established a credit quality
review process to provide early identification of possible changes in the creditworthiness of counterparties,
including regular collateral revisions. The Company assigns the following credit ratings to each class of financial
assets based on the assumptions, inputs and factors specific to the class of financial assets.

(i) Low credit risk

(ii) Moderate credit risk

(iii) High credit risk

* These represent gross carrying values of financial assets, without netting off impairment loss allowance.

Cash and cash equivalents and bank deposits

Credit risk related to cash and cash equivalents (excluding cash on hand) and bank deposits is managed by only
accepting highly rated deposits from banks and financial institutions across the country.

Trade receivables

Trade receivables measured at amortized cost and credit risk related to these are managed by monitoring the
recoverability of such amounts continuously.

Other financial assets measured at amortized cost

Other financial assets measured at amortized cost includes loans and advances to employees, security deposits,
insurance claim receivables and other recoverable. Credit risk related to these other financial assets is managed by
monitoring the recoverability of such amounts continuously.

Loans

The Company closely monitors the credit-worthiness of the borrower’s through internal systems and appraisal
process to assess the credit risk and define credit limits of borrower, thereby, limiting the credit risk by setting limits
on the amount of risk it is willing to accept for individual counterparties. These processes include a detailed appraisal
methodology, identification of risks and suitable structuring and credit risk mitigation measures. The Company
assesses increase in credit risk on an ongoing basis for amounts loan receivables that become past due and default
is considered to have occurred when amounts receivable become 90 days past due.

Wherever required, the Company holds other types of collateral and credit enhancements, such as cross¬
collateralisation on other assets of the borrower, pledge of securities, guarantees of promoters/proprietors,
hypothecation of receivables via escrow account, hypothecation of receivables in other bank accounts, etc.

The Company does not physically possesses properties or other assets in its normal course of business but
makes efforts toward recovery of outstanding amounts on delinquent loans. Once contractual loan repayments
are overdue, the Company initiate the legal proceedings against the defaulted customers.

B) Liquidity risk

Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with its
financial liabilities (other than derivatives) 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.

The Company maintains flexibility in funding by maintaining availability under committed credit lines. Management
monitors the Company’s liquidity positions (also comprising the undrawn borrowing facilities) and cash and cash
equivalents on the basis of expected cash flows. The Company also takes into account liquidity of the market in which
the entity operates.

(ii) Maturities of financial assets and liabilities

The tables below analyses the Company financial assets and liabilities into relevant maturity groupings based on their
contractual maturities. The table below shows an analysis of assets and liabilities analysed according to when they
are expected to be recovered or settled. Derivatives have been classified to mature and/or be repaid within 12 months,
regardless of the actual contractual maturities of the products. With regard to loans and advances to customers, the
Company uses the same basis of expected repayment behaviour as used for estimating the EIR. Issued debt reflect
the contractual coupon amortizations.

C) Market risk

a) Foreign currency risk

The Company is exposed to foreign exchange risk arising from foreign currency transactions. Foreign exchange
risk arises from recognized assets and liabilities denominated in a currency that is not the functional currency of
the Company. To mitigate the Company’s exposure to foreign currency risk, non-rupee cash flows are monitored
and derivative contracts are entered into in accordance with the Company’s risk management policies. Currency
risk is the risk that the value of a financial instrument will fluctuate due to changes in foreign exchange rates.
Foreign currency risk arise majorly on account of foreign currency borrowings. The Company manages its foreign
currency risk by entering in to cross currency swaps, interest rate swaps and forward contract. When a derivative
is entered in to for the purpose of being as hedge, the Company negotiates the terms of those derivatives to
match with the terms of the hedge exposure.

b) Interest rate risk
i) Liabilities

Interest rate risk arises from the possibility that changes in interest rates will affect future cash flows or
the fair values of financial instruments. 'The Company’s policy is to minimise interest rate cash flow risk
exposures on long-term financing. As at March 31, 2025, the Company is exposed to changes in market
interest rates through debt securities, other borrowings and subordinated liabilities at variable interest
rates.

45 | CAPITAL MANAGEMENT

The primary objectives of the Company’s capital management policy is to ensure that the Company complies with capital
adequacy requirements required by the Reserve Bank of India and maintains strong credit ratings and healthy capital ratios
in order to support its business and to maximise shareholder value.

The Company’s capital management objectives are

- to ensure the Company’s ability to continue as a going concern

- to comply with externally imposed capital requirement and maintain strong credit ratings

- to provide an adequate return to shareholders

Management assesses the Company’s capital requirements in order to maintain an efficient overall financing structure
while avoiding excessive leverage. This takes into account the sub-ordination levels of the Company’s various classes
of debt. The Company manages the capital structure and makes adjustments to it in the light of changes in economic
conditions and the risk characteristics of the underlying assets (including investments in Subsidiary companies). In order
to maintain or adjust the capital structure, the Company may adjust the amount of dividends paid to shareholders, return
capital to shareholders, issue new shares, or sell assets to reduce debt.

The Company records a liability when it is both probable that a loss has been incurred and the amount can be reasonably
estimated. Significant judgement is required to determine both probability and the estimated amount. The Company reviews
these provisions periodically and adjust these provisions accordingly to reflect the impact of negotiations, settlements,
rulings, advice of legal counsel and update information. The Company believes that the amount or estimable range of
reasonably possible loss, will not, either individually or aggregate, have a material adverse effect on its business, financial
position, results of the Company, or cash flows with respect to loss contingencies for legal and other contingencies as at
March 31,2025.

Disputed claims against the Company, including claims raised by the tax authorities and which are pending with appeal /
court and for which no reliable estimate can be made of the amount of the obligation, are not provided for in the accounts.
However, the present obligation, if any, as a result of past events with a possibility of outflow of resources, when reliably
estimable, is recognized in the accounts as an expense as and when such obligation crystallizes.

54 | EMPLOYEE STOCK OPTION PLAN / SCHEME (ESOP/ ESOS)

Pursuant to the approval accorded by Shareholders of Satin Creditcare Network Limited ("the Company") at their Annual
General Meeting held on July 06, 2017, the Nomination and Remuneration Committee of the Company formulated a new
scheme 'Satin Employee Stock Option Scheme 2017’ (ESOS 2017) in accordance with the Securities and Exchange Board
of India (Share Based Employee Benefits) Regulations, 2014 (or any amendment thereto or any other provisions as may
be applicable). ESOS is applicable to all permanent and full-time employees (as defined in the Plan), excluding Promoters
of the Company. The eligibility of employees to receive grants under the Plan has to be decided by the Nomination and
Remuneration Committee from time to time at its sole discretion. Vesting of the options and vesting period shall take place
in the manner determined by the Nomination and Remuneration Committee at the time of grant. Vesting of options shall be
subject to the condition that the Grantee shall be in continuous employment with the Company and such other conditions
as provided under ESOS 2017. The Exercise Price of each grant is determined by the Nomination and Remuneration
Committee at the time of grant.

Presently, stock options have been granted under Satin Employee Stock Option Scheme 2017 (ESOS 2017).

Earlier, the Company had implemented ESOP schemes in 2010, namely Satin ESOP 2010 and Satin ESOP II 2010. These
schemes were subsequently repealed pursuant to the Shareholders’ Resolution dated July 06, 2017, and the outstanding
options under these schemes were transferred to the Satin ESOS 2017.

The ESOP pool under the ESOS 2017 has 4,82,946 Options and Satin Employee Welfare Trust holds 4,82,946 shares
(including the impact of Right Issue) in its Demat account during the year ended March 31,2025.

As on 31 March 2025, under ESOS 2017 the options granted are 85,000 and the balance available ESOS pool for future
grant is 3,97,946 options.

The expected volatility was determined based on historical volatility data of the Company’s shares listed on the
National Stock Exchange of India Limited.

iv) The Company has INR 169.84 Lakhs (March 31, 2024: INR 169.74 Lakhs) recoverable from Satin Employees
Welfare Trust pursuant to ESOP schemes.

v) During the year ended March 31, 2025, the Company has recognized an expense of INR 43.29 lakh (March 31,
2024: INR Nil) towards share based payment expenses in the Statement of Profit and Loss.

55 | RECENT ACCOUNTING PRONOUNCEMENTS

Ministry of Corporate Affairs ("MCA") notifies new standard or amendments to the existing standards under Companies
(Indian Accounting Standards) Rules as issued from time to time. For the year ended on March 31, 2025, MCA has not
notified any new standards or amendments to the existing standards which are applicable from April 01,2025.

Below notes starting from 56 to 58 are non Ind AS information as required by different laws and regulations.

56 | DISCLOSURE AS PER MASTER DIRECTION RBI/DOR/2023-24/105 DOR.FIN.REC.NO.45/03.10.119/2023-24 DATED

OCTOBER 19, 2023 (UPDATED FROM TIME TO TIME) ARE AS UNDER

Disclosure of expected credit loss and provisions required as per Income Recognition and Asset Classification norms;

Qualitative Disclosures

The Company, in accordance with regulations set forth by the Reserve Bank of India for Non-Banking Financial
Companies engaged in Microfinance (NBFC-MFIs), complies with FEMA Regulations, notifications, and circulars
issued for External Commercial Borrowings.

Given the inherent volatilities and uncertainties in the global Foreign Exchange markets, the Company faces
potential risk due to adverse currency movements as it holds foreign currency liabilities. Additionally, the
Company is also exposed to interest rate risk on its long-term Foreign Currency Loans.

To mitigate these risks, the Company has implemented a Forex Risk Management policy aimed at reducing the
probability and potential costs of financial distress by achieving currency and interest rate neutrality.

Under this policy, any exposure in foreign currency is fully hedged covering the currency risk as well as the
interest rate risk on the day of the liability's emergence. The authority to make decisions regarding the quantum
and tenor of hedging is delegated by the Board committee/Board of Directors as necessary.

Furthermore, the Company adheres to accounting standards and guidance notes issued by the Institute of
Chartered Accountants of India for the recognition of losses, gains, creation of assets, or liabilities.

In addition to these measures, the management conducts monthly monitoring to track gains and losses
recognized. Moreover, foreign currency exposure reporting is provided to the board on an annual basis to ensure
comprehensive oversight.

*The Company has entered into Full Currency Swaps that allows to convert long term FCY liability (Interest and
Principal) to a fixed INR liability.

(iv) (a) Disclosures relating to securitisation:-

The Company has entered into various agreements for the securitisation of loans with assignees, wherein
it has securitized a part of its loans portfolio amounting to INR 79,584.31 Lakhs during the year ended
March 31,2025 (March 31,2024 INR 1,23,480.00 Lakhs), being the principal value outstanding as on the
date of the deals that are outstanding. The Company is responsible for collection and getting servicing
of this loan portfolio on behalf of investors/buyers. In terms of the said securitisation agreements, the
Company pays to investor/buyers on agreed date basis the prorata collection amount as per individual
agreement terms.

9 Pursuant to RBI circular RBI/2019-20/88 DOR.NBFC (PD) CC. No.102/03.10.001 /2019-20 dated November 04,
2019, Liquidity credit risk disclosures are presented as below:

Qualitative Disclosure on LCR

As per Reserve Bank of India guidelines, all deposit-taking NBFCs irrespective of their asset size and non-deposit¬
taking NBFCs with an asset size of INR5,000 Crores and above are required to maintain a liquidity coverage ratio
(LCR) to ensure availability of adequate high-quality liquid assets (HQLA) to survive any acute liquidity stress
scenario i.e, cash outflow increased to 115% and cash inflow decreased to 75%, lasting for 30 days. As per RBI
guidelines, LCR has been calculated using the simple average of daily observations over the previous quarter
(over a period of 90 days).

Cash outflows under secured and unsecured wholesale funding include contractual payments of the term loan,
NCDs, and other debt obligations including interest payments due in next 30 days. Other contractual funding
obligations include contractual payments due in next 30 days.

To compute inflow from fully performing exposures, the Company considers collection from performing
advances including interest due in the next 30 days. Other cash inflows include cash from unencumbered fixed
deposits, Certificates of deposits, undrawn lines of credit, and mutual fund investments maturing in the next 30
days. The LCR as of March 31,2025 is 130.4%, which is well above the regulatory requirement of 100%.

(vii) Institutional set-up for liquidity risk management

The Company has a robust risk management system in place. To ensure smooth functioning of business
operations, the Company maintains adequate liquidity in the form of cash, bank balances, fixed deposits,
T-Bills and mutual funds. The Board has the ultimate responsibility for the SCNL’s risk management
including liquidity risk.The Board has delegated the oversight and review of liquidity risk management to
the Risk Management Committee of the Board (RMCB) which is supported by Executive Risk Management
Committee (ERMC) and the Asset Liability Management Committee (ALCO). The responsibility of the ALCO
is to manage liquidity risk, ensures compliance with policies, frameworks, internal limits, and regulatory
limits related to ALM and update the same to the board. The Executive Risk Management Committee is
responsible for overseeing the implementation of risk management framework across SCNL and providing
recommendations to the RMCB. ERMC, RMCB, and ALCO meetings are held at periodic intervals.

60 | ADDITIONAL INFORMATION PURSUANT TO MINISTRY OF CORPORATE AFFAIRS NOTIFICATION DATED MARCH 24,

2021 WITH RESPECT TO AMENDMENTS IN SCHEDULE III OF COMPANIES ACT, 2013

(i) All the borrowings of the Company are used for the specific purpose for which it was taken.

(ii) There are no proceedings which have been initiated or pending against the Company for holding any benami property
under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and rules made thereunder.

(iii) The Company is not a wilful defaulter as declared by any bank or financial Institution or any other lender.

(iv) The Company reviews transactions on an ongoing basis to identify if there are any transactions with struck off
companies. To the extent information is available on struck off companies, there are no transactions with struck off
companies except as mentioned below.

(v) There are no charges or satisfaction yet to be registered with Registrar of Companies (ROC) beyond the statutory
period.

(vi) The Company has complied with the number of layers prescribed under clause (87) of section 2 of the Act read with
Companies (Restriction on number of Layers) Rules, 2017.

(vii) There are no transactions which are not recorded in the books of accounts that has been surrendered or disclosed
as income during the year in the tax assessments under the Income Tax Act, 1961 (such as, search or survey or any
other relevant provisions of the Income Tax Act, 1961).

(viii) The Company has not traded or invested in Crypto currency or Virtual Currency during the current year and previous
year.

61 | Previous year figures have been regrouped/rearranged, wherever considered necessary, to confirm to the classification/
disclosure adopted in the current year.

For J C Bhalla & Co. For and on behalf of the Board of Directors

Chartered Accountants Satin Creditcare Network Limited

Firm’s Registration No. 001111N

Rajesh Sethi Harvinder Pal Singh Satvinder Singh

Partner (Chairman cum Managing Director) (Director)

Membership Number: 085669 DIN: 00333754 DIN: 00332521

Anil Kumar Kalra Manoj Agrawal

(Chairman Audit Committee cum Director) (Chief Financial Officer)

DIN: 07361739

Vikas Gupta

(Company Secretary & Chief Compliance Officer)

Membership Number: A24281

Place : Gurugram Place : Gurugram

Date : May 07, 2025 Date : May 07, 2025