Baid Finserv Ltd

To,

The Members,

Baid Finserv Limited

(Formerly Known as Baid Leasing and Finance Co. Ltd.)

The Board of Directors are pleased to present the 33^rd (Thirty-Third) Annual Report of Baid Finserv Limited (Formerly Known as Baid Leasing and Finance Co. Ltd) ("Company") on the business, operations and state of affairs of the Company together with the Audited Annual Financial Statements for the Financial Year ended on 31^st March 2024.

1. FINANCIAL PERFORMANCE

The highlights of Company's financial performance for the Financial Year ended on 31^st March, 2024 are summarized below:

2. PERFORMANCE REVIEW AND STATE OF COMPANY'S AFFAIRS

Total Income for the FY 2023-24 under review were Rs 6,635.83 Lakhs as against Rs.5,573.46 Lakhs in the previous FY 2022-23. The profit before tax for the FY 2023-24 is Rs. 1809.71 Lakhs as against Rs.1,398.96 Lakhs in the previous FY 2022-23. The profit after tax is Rs. 1292.40 Lakhs for the FY 2023-24 as against Rs. 1,037.89 Lakhs in the previous FY 2022-23.

The Company has recorded an increase in revenue of 19.06 % during the year under review.

The Asset Under Management ("AUM") of Company during the year under review were Rs.36,571.83 Lakhs as against Rs. 30,086.59 Lakhs in the FY 2022-23. Sector-wise details are as follows:

The improvement in the revenues is a result of the aggressive marketing and robust collections. The Company endeavors to continue the tremendous growth rate. The Company's overall performance during the Financial Year 2023-24 was robust resulting in improvement in all operational and financial parameters.

In FY 2023-24, the Gross and Net NPAs stood at 2.61% and 0.36% respectively as compared to 2.91% and 0.64 %, in FY 2022-23, respectively.

The Company reported strong financial results due to its judicious pricing decisions, increase in its AUM, quality disbursements and better collection efficiency. Further, the Company was able to raise the necessary resources throughout the year to match the business and operational requirements, leveraging its relationships with banks and financial institutions, as well as forming new lender relationships. The Company believes that each customer is a critical asset in its growth journey and their satisfaction is primary responsibility of the company.

The Company's prudent liquidity management techniques and strategy of maintaining adequate liquidity buffer throughout the Financial Year 2023-24 not only ensured seamless lending for our business operations but also ensured meeting our liabilities on time, thereby further strengthening the trust and confidence reposed on us by our creditors and security holders.

3. DIVIDEND

RBI vide its circular dated 24 June 2021 has laid down a framework for declaration of dividend by NBFCs. Accordingly, the Board of Directors, after taking into account various aspects and in compliance with the said circular, recommend for consideration of the members at the ensuing Annual General Meeting (‘AGM'), payment of final dividend of Re. 0.10 paisa (5 %) per equity share of face value Rs. 2. The total dividend for FY2023-24 is Rs. 1,20,06,830.

Total dividend proposed for the year does not exceed the ceilings specified in said circular/ RBI Master Directions. The dividend, if declared, at the ensuing AGM will be taxable in the hands of the members of the Company pursuant to Income Tax Act, 1961. For further details on taxability, please refer Notice of AGM.

4. BRANCH EXPANSION

The Company has expanded its geographical presence by reaching out to underserved/unserved semi urban/rural areas and increased its footprint by opening new branches in Madhya Pradesh and Gujarat and making itself more accessible to its customers and is further planning to strengthen its presence in Maharashtra. This step will further enhance the presence of the Company in different geographical locations, enabling it to penetrate into new markets and expand its reach to a wider number of customers for offering and delivering financial services in transparent manner.

5. MATERIAL CHANGES AND COMMITMENT AFFECTING FINANCIAL POSITION OF THE COMPANY/CHANGE IN THE NATURE OF THE BUSINESS

There were no material changes and commitment that have occurred between the closure of the Financial Year 2023-24 till the date of this Report, which would affect the financial position of your Company. There is no change in the nature of the business as compared to the immediately preceding Financial Year.

6. SHARE CAPITAL

The issued, subscribed and paid-up Equity Share Capital of the Company as on March 31, 2024 stood at Rs. 24,01,36,600/- (Rupees Twenty Four Crore One Lakh Thirty Six Thousand Six Hundred Only) consisting of 12,00,68,300 (Twelve Crore Sixty Eight Thousand Three Hundred ) Equity Shares of Rs. 2/-(Rupees Two Only) each.

The authorized share capital as on March 31, 2024 stood at Rs.30,00,00,000divided into15,00,00,000 equity shares of Rs. 2/- each.

There was no change in authorized, issued, subscribed and paid up capital during the year.

Below updates were reported in Share capital of the Company between the closure of the Financial Year 2023-24 till the date of this Report: INCREASE IN AUTHORISED SHARE CAPITAL

The Authorized Share Capital of the Company has increased pursuant to the approval of members through Postal Ballot on Tuesday, April 09, 2024, from Rs. 30,00,00,000/- (Rupees Thirty Crores Only) divided into 15,00,00,000 (Fifteen Crores) Equity Shares of Rs. 2/- (Rupees Two Only) each to Rs. 40,00,00,000/- (Rupees Forty Crores Only) divided into 20,00,00,000 (Twenty Crores) Equity Shares of Rs. 2/- (Rupees Two Only) each.

7. ANNUAL RETURN

The draft Annual Return of the Company as on March 31, 2024 in the Form MGT-7 in accordance with the provisions of Section 92 (3) , read with Section 134(3)(a) of the Companies Act, 2013 ("Act"), and the Companies ( Management and Administration) Rules 2014 is hosted on the website of the Company and can be accessed at https://www.baidfinserv.com/wp-content/uploads/2024/06/14.-Form_MGT_7.pdf

8. TRANSFER TO RESERVE FUND AND INVESTOR EDUCATION AND PROTECTION FUND

Reserves and Surplus Account as on March 31, 2024 of your Company increased by 8.98% to Rs.14,276.87/- as against Rs. 13,099.54/- Lakhs as at March 31, 2023.

Under section 45-IC(1) of Reserve Bank of India Act, 1934, non-banking financial companies (NBFCs) are required to transfer a sum of not less than 20% of its net profit every year to reserve fund before declaration of any dividend. Accordingly, your Board of Directors has transferred a sum of Rs. 258.48 Lakhs to Special Reserve in compliance with the provisioning norms of the RBI.

The Board has not transferred any amount to the General Reserve for the period under review.

Pursuant to the provisions of Section 124(6) of the Companies Act, 2013 ("the Act") read with

Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 ("IEPF Rules"), the interim dividend which was declared by the Company for Financial Year 2016-17 and in respect of which dividend has not yet been claimed by the shareholders of the company for seven consecutive years were transferred to the IEPF Authority along with the unpaid/unclaimed amount of dividend payable thereon during the FY 2023-24.

The company has transferred amount of Rs. 336,119.50 to Investor Education and Protection Fund Authority

9. ASSOCIATE COMPANIES, JOINT VENTURE AND SUBSIDIARY COMPANIES

The Company does not have any subsidiary, associate and Joint Venture as on March 31, 2024. Hence, the details of this clause are not applicable to the Company.

10. DIRECTORS/ KEY MANAGERIAL PERSONNEL APPOINTMENT/ RE-APPOINTMENT/ CESSATION

During the year under review, following changes took place in the Composition of Board of Directors and Key Managerial Personnel of the Company:

A. Directors liable to retire by rotation: In accordance with the Section 152(6) and other applicable provisions of the Act and the rules made there under and the Articles of Association of the Company, Mrs. Alpana Baid (DIN: 06362806) Non-Executive Director of the Company is liable to retire by rotation at the ensuing Annual General Meeting (‘AGM') and being eligible, has offered herself for re-appointment.

Mr. Aman Baid (DIN: 03100575) Whole-Time Director retired by rotation and was re-appointed in the previous AGM held on September 07, 2023.

B. Appointment of Independent Directors:

i) Mr. Surendra Kumar Singhi (DIN: 01048397) was appointed by the Board of Directors of the Company as an Additional Director (Non-Executive, Independent) at their meeting held on Friday, August, 04, ,2023 under Section 161 of the Act. The members of the company at the 32^ndAGM, on recommendation of the Board, approved his appointment as a Non-Executive Independent Director of the Company for a period of 5 years w.e.f August 04, 2023 to August 03, 2028.

Mr. Surendra Kumar Singhi is B Com Graduate from University of Delhi bearing more than 31 Years of experience in the field of finance, accounting and management. His expertise and Knowledge leads in different sectors of Finance, Accounting and Management. He possessed detailed practical Knowledge and expertise in his field.

ii) Mr. Chaitnya Sharma (DIN: 10253651) was appointed by the Board of Directors of the Company as an Additional Director (Non-Executive, Independent) at their meeting held on Friday, August, 04, ,2023 under Section 161 of the Act. The members of the Company, at the 32^ndAGM, on recommendation of the Board approved his appointment as a Non-Executive Independent Director of the Company for a period of 5 years w.e.f August 04, 2023 to August 03, 2028.

Mr. Chaitnya Sharma is BBA Graduate from University of Rajasthan bearing more than 4 years of experience in the field of finance, accounting, management and corporate governance. He possessed details practical Knowledge and expertise in his field.

C. Cessation of Independent Directors

Mr. Mudit Singhi (DIN: 03171115) and Mr. Monu Jain (DIN: 02609467) have ceased to be directors of the Company w.e.f. close of business hours on March 31, 2024 upon completion of their second term as Independent Directors.

D. Re-appointment of Chairman and Managing Director:

Mr. Panna Lal Baid (DIN: 00009897) Chairman and Managing Director of the Company was reappointed in the 32^ndAGM held on September 07, 2023 for a period of 3 years with effect from April 01, 2024.

Mr. Panna Lal Baid is the Founder and first generation entrepreneur bearing more than 54 years expertise in diversified sectors and more particularly into core finance sector. He created the strategic presence of the company in high yield pre-owned vehicle financing segment with expertise in loan origination, valuation and collection.

The present Directors of the Company are as follows:

* Mr. Surendra Kumar Singhi and Mr. Chaitnya Sharma were appointed as an independent directors of the company w.e.f. August 04, 2023.

** Mr. Mudit Singhi and Mr. Monu Jain have ceased to be directors of the Company w.e.f. close of business hours on March 31, 2024 upon completion of their second term as Independent Directors.

The Board Composition of the Company is available on the Company's website and can be accessed at https://www.baidfinserv.com/board-of-directors/

None of the Directors of the Company are disqualified in accordance with Section 164 of the Act. The changes in the composition of the Board of Directors that took place during the period under review were carried out in compliance with the provisions of the Act and Listing Regulations.

Also, as per the Listing Regulations, the Company has received Certificate from M/s. V.M. & Associates, Practicing Company Secretaries that none of the Directors on the Board of the Company have been debarred or disqualified from being appointed or continuing as Directors of Companies by the Securities and Exchange Board of India/ Ministry of Corporate Affairs or any such other statutory authority.

Key Managerial Personnel

The present Key Managerial Personnel of the Company are as follows:

Senior Management Personnel:

The present Senior Managerial Personnel of the Company are as follows:

*Mr. Dalveer Singh Khangarot had resigned from the company w.e.f closure of business hours December 23, 2023, accordingly he ceased from the position of SMP after the said date.

11 . DECLARATION BY INDEPENDENT DIRECTORS

The Company has received necessary declarations from each of the Independent Director of the Company that they meet the criteria of independence as provided under section 149(6) of the Act and have complied with the Code of Conduct as prescribed in the Schedule IV of the Act, as amended from time to time and Regulation 16 and 25 of Listing Regulations in respect of their position as an "Independent Director" of Baid Finserv Limited.

Further, pursuant to the provisions of the Companies (Creation and Maintenance of Databank of Independent Directors) Rules, 2019 and sub rule (1) and (2) of Rule 6 of the Companies (Appointment and Qualification of Directors) Rules, 2014, the name of Independent Directors are included in the Databank maintained by Indian Institute of Corporate Affairs (IICA). With regard to proficiency of the Independent Directors, ascertained from the online proficiency self-assessment test conducted by the IICA, as notified under sub section (1) of Section 150 of the Act, the company has taken on record the declarations submitted by the Independent Director Mr. Anurag Patni (DIN: 07580695) Non-Executive and Independent Director he is not required to pass online proficiency self-assessment test as per proviso to sub-rule (4) of Rule 6 of the Companies (Appointment and Qualification of Directors) Rule, 2014,

Further Mr. Surendra Kumar Singhi (DIN: 01048397) and Mr. Chaitnya Sharma (DIN: 10253651) Non-Executive, Independent Directors of the company have registered their name in the data bank on July 14, 2023 and July 24, 2023 respectively. Accordingly, they are required to pass online proficiency self-assessment test for Independent Director's Databank within a period of two years from the date of inclusion of their name in the data bank.

The Board took on record the declaration and confirmation submitted by the independent directors regarding them meeting the prescribed criteria of independence, after undertaking due assessment of the veracity of the same in terms of the requirements of regulation 25 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations 2015 ("Listing

Regulations").

In the opinion of the Board, the Independent Directors of the Company fulfill the conditions specified in the Act and Listing Regulations and have complied with the Code for Independent Directors prescribed in Schedule IV to the Act and are independent of the management.

12. REMUNERATION POLICY FOR DIRECTORS, KEY MANAGERIAL PERSONNEL AND OTHER EMPLOYEES AND CRITERIA FOR APPOINTMENT OF DIRECTORS

The management of the Company is immensely benefitted from the guidance, support and mature advice from the members of the Board of Directors who are also members of the various Committees. The Board consists of the director possessing diverse skills, rich experience to enhance the quality performance of its Directors.

For the purpose of selection of any Director, the Nomination and Remuneration Committee identifies persons of integrity who possess relevant expertise, experience and leadership qualities required for the position. The Committee also ensures that the incumbent fulfils such criteria with regard to qualifications, positive attributes, independence, age and other criteria as laid down under the Act, Listing Regulations or other applicable laws.

The Board of Directors has, on the recommendation of the Nomination and Remuneration Committee framed a policy on appointment and remuneration of Directors, Key Managerial Personnel and Senior Managerial Personnel including criteria for determining qualifications, positive attributes, independence of a Director and other matters as mandated under Section 178 (3) of the Act and Regulation 19 read with Part D of Schedule II of the Listing Regulations.

The objective of this Policy is to serve as a guiding charter to appoint qualified persons as directors on the Board of Directors of the Company ("Directors"), Key Managerial Personnel (the "KMP"), persons who may be appointed in senior management positions ("SMP"), to recommend the remuneration to be paid to them and to evaluate their performance.

The Nomination and Remuneration Policy, approved by the Board is available on the website of the Company and the same can be accessed at https://www.baidfinserv.com/wp-content/uploads/2023/05/Policy/20.%20Nomination%20and%20Remuneration%20Policy.pdf?_t= 1684581018

The salient aspects covered in the Nomination and Remuneration Policy have been outlined below:

(a) To review the structure, size and composition (including the skills, knowledge and experience) of the Board at least annually and making recommendations on any proposed changes to the Board to complement the Company's corporate strategy, with the objective to diversify the Board;

(b) To identify individuals suitably qualified to be appointed as the KMPs or in the senior management of the Company;

(c) To recommend to the Board on the selection of individuals nominated for Directorship;

(d) To make recommendations to the Board on the remuneration payable to the Directors / KMPs /Senior Officials so appointed /reappointed;

(e) To assess the independence of independent Directors;

(f) such other key issues/matters as may be referred by the Board or as may be necessary in view of the regulations and provision of the Act and Rules thereunder.

(g) To make recommendations to the Board concerning any matters relating to the continuation in office of any Director at any time including the suspension or termination of service of an Executive Director as an employee of the Company subject to the provision of the law and their service contract;

(h) To ensure that level and composition of remuneration is reasonable and sufficient, relationship of remuneration to performance is clear and meets appropriate performance benchmarks;

(i) Performance Evaluation of every Director, Key Managerial Personnel and Senior Management Personnel.

13. FAMILIARISATION PROGRAMME FOR THE INDEPENDENT DIRECTORS

In compliance with the requirements of Regulation 25(7) of the Listing Regulations, the Company has put in place a Familiarisation Programme for the Independent Directors to familiarize them with the Company, their roles, rights, duties, responsibilities in the Company, nature of the industry in which the Company operates, business model of the Company and other related matters. The details of number of programmes and number of hours spent by each of the Independent Directors during the Financial Year 2023-24 and on the cumulative basis, in terms of the requirements of Listing Regulations are posted on the website of the Company and can be accessed at: https://www.baidfinserv.com/wp-content/uploads/2024/05/2.-Familiarisation-programme-23-24.pdf

14. NUMBER OF MEETINGS OF BOARD OF DIRECTORS

Regular meetings of the Board are held to discuss and decide on various business policies, strategies and other matters.

During the period under review, 5 (Five) Meetings of Board of Directors were held. The requisite quorum was present for all the Meetings. The intervening gap between the meetings was within the period prescribed under the Act, Secretarial Standard-1 (SS-1) issued by the Institute of Company Secretaries of India and the provisions of Listing Regulations. Details of the meeting of board and attendance of the Directors there at forms part of the "Corporate Governance Report".

COMMITTEE OF DIRECTORS

The Company has various Committees which have been constituted as a part of good corporate governance practices and the same are in compliance with the requirements of the relevant provisions of applicable laws and statutes. The Board has constituted Eight Committees: i. Audit Committee ii. Nomination and Remuneration Committee iii. Stakeholders' Relationship Committee iv. Corporate Social Responsibility Committee v. Risk Management Committee vi. Asset Liability Management Committee vii. Executive Committee viii. Internal Complaints Committee

The abovementioned committees are formed in compliance with the provisions of the Act, Listing regulations and other guidelines along with master circulars issued by the RBI. The Company Secretary is the Secretary of all the aforementioned Committees.

The Board of Directors and the Committees also take decisions by Resolutions passed through Circulation which are noted by the Board/ respective Committees of the Board at their next meetings. During the year under review, 1(One) resolution was passed by Circulation by the Board of Directors

The Details of Board and Committees including composition and Meetings held during the Financial Year ended on 31^st March, 2024 and attendance thereto are set out in the Corporate Governance Report enclosed as Annexure I which forms part of this report.

MEETING OF INDEPENDENT DIRECTORS

A separate meeting of Independent Directors was held on May 19, 2023 without presence of Non-Independent Directors, Members of Management and employees of the Company as required under the Act and in Compliance with requirement under Schedule IV of the Act and as per requirements of Listing Regulations and discussed matters specified therein. The Company Secretary and Compliance Officer of the Company, facilitated the convening and holding of the meeting upon instructions of the Independent Directors.

The meeting was attended by all the Independent Directors of the Company.

15. EVALUATION OF PERFORMANCE OF THE BOARD, ITS COMMITTEES AND INDIVIDUAL DIRECTORS

Performance evaluation is becoming increasingly important for Board and Directors, and has benefits for individual Directors, Board and the Companies for which they work. The Securities and Exchange Board of India ("SEBI") has issued a Guidance Note on Board Evaluation. In terms of the requirement of the Act and the Listing Regulations, an annual performance evaluation of the Board is undertaken where the Board formally assess its own Performance, with the aim to improve the effectiveness of the Board and its Committee Members. The manner for performance evaluation of Directors (including Independent Directors) and Board as a whole has been covered in the Corporate Governance Report enclosed as Annexure I which forms part of this report.

16. DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013 AND INTERNAL COMPLAINT COMMITTEE (ICC).

Your Company has always believed in providing safe and harassment free workplace for every individual working in its premises through various interventions and practices. The Company ensures that the work environment at all its locations is conducive to fair, safe and harmonious relations between employees. It strongly believes in upholding the dignity of all its employees, irrespective of their gender or seniority. Discrimination and harassment of any type are strictly prohibited.

The Company has adopted a policy for Prevention, Prohibition and Redressal of Sexual Harassment of Women at Workplace in line with the requirements of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition and Redressal) Act, 2013 (POSH Act). The Company has complied with the provisions relating to constitution of internal complaints committee (ICC) under the POSH Act. All women employees are covered under this policy. ICC has been set up to redress complaints received regarding sexual harassment.

The details of the complaints received during the year under review were as follows:

17. AUDITORS & AUDITOR'S REPORT

? Statutory Auditors & Audit Report

Pursuant to the provisions of section 139 of the Act, M/s. Khilnani & Associates, Chartered Accountants (Firm Registration No. 005776C) were appointed as the Statutory Auditors of the Company, for a term of five years, to hold office from the conclusion of the 29^thAGM held on September 30, 2020 till the conclusion of the 34^thAGM.

Further, pursuant to Section 141 of the Act and relevant Rules prescribed there under, the Company has received a confirmation from the Auditors along with peer review certificate, that they are eligible to continue with their appointment and that they are not disqualified in any manner whatsoever from continuing as Statutory Auditors.

Statutory Auditor provided observation in Audit Report which are given below

Observation(s) in Audit Report:

In accordance with the Proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014, which mandates the utilization of accounting software equipped with an audit trail (edit log) facility from April 1, 2023, it is observed that company has not implemented this requisite feature in its accounting software.

Management Reply:

The Company is currently using jaguar software for accounting purpose, as of now jaguar is in process to enable the feature audit trail (edit log) in our software, as soon as same feature gets updated , we will able to maintain books of account having feature of recording audit trail (edit log) facility. In case jaguar takes time in updation, we will approach other vendors in order to comply with the provisions of the proviso to Rule 3(1) of the Companies (Accounts) Rules, 2014.

Except this, Financial Statements and the Auditor's Report for the financial year ended on 31st

March, 2024 are free from any qualification, reservation, observation and adverse remark. Further the notes on accounts are self-explanatory. The Auditors' Report is enclosed with the Financial

Statements in this Annual Report.

? Secretarial Auditor & Secretarial Audit Report

As per Section 204 of the Act read with rule 9 of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, every Listed Company is required to appoint a Secretarial Auditor to carry out Secretarial Audit of the Company.

In consonance with the aforementioned requirements, M/s V. M. & Associates, Company Secretaries (Firm Reg. No. P1984RJ039200) were appointed as Secretarial Auditors to conduct the secretarial audit of the Company for the financial year 2023-24.

Secretarial Audit Report in Form MR-3 as issued by M/s V. M. & Associates, Company Secretaries, in respect of the secretarial audit of the Company for the financial year ended on 31^st March, 2024, is given in Annexure V to this Report.

In accordance with Regulation 24 A of the Listing Regulations, a report on secretarial compliance issued by M/s V. M. & Associates, Company Secretaries for FY 2023-24 has been submitted with the stock exchanges. They have stated in the report that the Company has complied with the provisions of the Act, rules made thereunder, Secretarial Standards, SEBI Regulations, Guidelines and RBI Master Directions applicable on the Company.

Both the reports do not contain any qualification, reservation or adverse remark.

M/s. V. M. & Associates, Company Secretaries (Firm Registration Number: P1984RJ039200) have confirmed their eligibility and willingness to accept the re-appointment as Secretarial Auditor of the Company. The Company has received consent/eligibility certificates from M/s V. M. & Associates, Company Secretaries. Accordingly, Board in its meeting held on May 27, 2024 has re-appointed M/s V. M. & Associates, Company Secretaries, Jaipur as Secretarial Auditor (Firm Reg. No. P1984RJ039200) of the Company to carry out Secretarial Audit of the Company for the Financial Year 2024-25.

? Internal Auditor

Pursuant to Section 138 of Act read with Companies (Audit and Auditors) Rules, 2014, every Listed Company is required to appoint an Internal Auditor or a firm of Internal Auditors to carry out Internal Audit of the Company.

In consonance with the aforementioned requirements, M/s. Shiv Shankar Khandelwal & Co. (Firm Registration No. 006852C), Chartered Accountants, were appointed as Internal Auditors to conduct the Internal Audit of the Company for the Financial Year 2023-24.

The Internal Audit Report for the financial year ended on 31^st March, 2024 was submitted before the audit Committee and Board of Directors.

The Internal Auditor's Report for the financial year ended on 31^st March, 2024 are free from any qualification, reservation, observation and adverse remark.

M/s. Shiv Shankar Khandelwal & Co., Chartered Accountants (Firm Registration No. 006852C) have confirmed their eligibility and willingness to accept the appointment. The Company has received consent/eligibility certificates etc. from M/s. Shiv Shankar Khandelwal & Co., Chartered Accountants.

Accordingly, Board in its meeting held on May 27, 2024 has re-appointed M/s Shiv Shankar Khandelwal & Co., Chartered Accountants, Jaipur (Firm Reg. No. 006852C) as the Internal Auditor of the Company for the Financial Year 2024-25.

? Cost Audit

The provisions of Section 148 of the Act read with Companies (Cost Records and Audit) Rules, 2014 are not applicable to the Company. Hence, the maintenance of the cost records as specified by the Central Government under Section 148(1) of the Act is not required and accordingly, such accounts and records are not made and maintained. The Company has not appointed any Cost Auditor during the year.

? REPORTING OF FRAUDS BY AUDITORS

During the year under review, Statutory Auditor, Secretarial Auditor and Internal Auditor have not reported to the audit committee, under Section 143 (12) of the Act, any instances of fraud committed against the Company by its officers or employees.

18. PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS IN SECURITIES BY THE COMPANY

Pursuant to the provisions of Section 186(11) of the Act, read with Rule 11(2) of the Companies (Meetings of Board and its Powers) Rules, 2014, the loans made, guarantees given or securities provided or acquisition of securities by a Non-Banking Financial Company (NBFC) registered with RBI, in the ordinary course of its business are exempted from the applicability of Provisions of Section 186 of the Act. As such the particulars of loans and guarantee have not been disclosed in this Report. Further, particulars of Loans given and investments made by the company for the financial year ending March 31, 2024 are given under Note no. 4 and 5 respectively of the Financial Statements of the company forming part of this Annual Report.

19 . RELATED PARTY TRANSACTIONS

All contracts/arrangement/transactions entered by the Company during Financial Year 2023-24 with related parties were in compliance with section 188 of the Act, Regulation 23 of Listing regulations and IND AS-24 and are disclosed under Note No. 6 of the Notes to Standalone Financial Statements for the year ended March 31, 2024. Prior omnibus approval of the Audit Committee is obtained for all related party transactions which are foreseen and of repetitive nature.

Pursuant to the said omnibus approval, details of transaction entered into with related parties is also reviewed by the Audit Committee on a quarterly basis. All related party transactions entered during Financial Year 2023-24 were in the ordinary course of business and on arm's length basis and not material under the Act and SEBI Listing Regulations. None of the transactions required members' prior approval under the Act or SEBI Listing Regulations.

Further, there are no materially significant related party transactions during the year under review made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large. Thus, disclosure in Form AOC-2 is not required.

The Company has adopted a policy on materiality of related party transactions and on dealing with Related Party Transactions and the same is disclosed on the website of the Company and can be accessed at https://www.baidfinserv.com/wp-content/uploads/2023/05/Policy/11.%20POLICY%20FOR%20Materiality%20of%20RPT.pdf?_t=16845 81018

20. RISK MANAGEMENT

Risk Management is an integral part of the Company's business strategy with focus on building risk management culture across the organization. The Company has developed and implemented a risk management policy which encompasses practices relating to identification, assessment monitoring and mitigation of various risks to key business objectives. The Risk management framework of the Company seeks to minimize adverse impact of risks on our key business objectives and enables the Company to leverage market opportunities effectively.

The various key risks to key business objectives are as follows:

Liquidity Risk: It is the risk that the Company will be unable to meet its financial commitment to a Bank/ Financial Institution in any location, any currency at any point in time. Liquidity risk can manifest in three different dimensions for the Company.

Time Risk: To compensate for non-receipt of expected inflows of funds.

Call Risk: Due to crystallization of contingent liabilities or inability to undertake profitable business opportunities when desirable.

Interest Rate Risk: It is the risk where changes in market interest rates might adversely affect the

Company's financial condition. The short term/immediate impact of changes in interest rates are on the Company's Net Interest Income (NII). On a longer term, changes in interest rates impact the cash flows on the assets, liabilities and off-balance sheet items, giving rise to a risk to the net worth of the Company arising out of all re-pricing mismatches and other interest rate sensitive positions.

Strategic Risk: Strategic or business risk is the risk associated with the formulation and execution of an organisation's strategy.

The Company's Risk Management Policy is put up on the Company's website and can be accessed through web link https://www.baidfinserv.com/wp-content/uploads/2023/05/Policy/9.%20Risk%20Mangement%20Policy.pdf?_t=1684581018

Risk Treatment

To prioritize risk control actions in terms of their potential to benefit the organization. Risk treatment includes risk control/ mitigation and extends to risk avoidance, risk transfer (insurance), risk financing, risk absorption etc. for-

a) Effective and efficient operations b) Effective Internal Controls c) Compliance with laws and regulations

Risk Treatment shall be applied at all levels through carefully selected validations at each stage to ensure smooth achievement of the objective.

21. INTERNAL FINANCIAL CONTROL SYSTEMS

The Company believes that internal control is a necessary prerequisite of Governance and that freedom should be exercised within a framework of checks and balances. The Company has a well-established internal control framework, which is designed to continuously assess the adequacy, effectiveness and efficiency of financial and operational controls. The financial control framework includes internal controls, delegation of authority procedures, segregation of duties, system access controls and document filing and storage procedures.

The management is committed to ensure an effective internal control environment, commensurate with the size, scale and complexity of the business, which provides an assurance on compliance with internal policies, applicable laws, regulations and protection of resources and assets. The control system ensures that the Company's assets are safeguarded and protected and also takes care to see that revenue leakages and losses to the Company are prevented and our income streams are protected. The control system enables reliable financial reporting. The Audit Committee reviews adherence to internal control systems and internal audit reports.

The Company has received report on Internal Financial Controls from statutory auditors of the company.

22. DETAILS RELATING TO DEPOSITS

Being a non-deposit taking NBFC, the Company has not accepted any deposit within the meaning of the Companies (Acceptance of Deposits) Rules, 2014 or Chapter V of the Act, and guidelines and directions of Non-Banking Financial Companies (Acceptance of Public Deposits) (Reserve Bank) Directions, 2016 as prescribed by RBI in this regard and as such no details are required to be furnished.

23. MANAGEMENT DISCUSSION & ANALYSIS REPORT

A separate Section on Management's Discussion and Analysis Report is included as Annexure VI of the Annual Report, pursuant to Regulation 34(2) (e) of Listing Regulations.

24. CORPORATE GOVERNANCE REPORT

Your Company practices a culture that is built on core values and ethical governance practices. The Company is committed to maintain the highest standards of Corporate Governance and adhere to the Corporate Governance requirements set out by the Securities and Exchange Board of India

("SEBI"). The Company has also implemented several best governance practices. The report on Corporate Governance for the Financial Year ended on March 31, 2024 along with Certificate issued by the M/s V.M. & Associates, Company Secretaries confirming the compliance to applicable requirements related to corporate governance as stipulated under Schedule V of the Listing Regulations forms part of this Annual Report as Annexure I.

Compliance reports in respect of all laws applicable to the Company have been reviewed by the Board of Directors of the Company.

Particulars with respect of conservation of energy, technology absorption, foreign exchange earnings and outgo:

The information required under Section 134(3) (m) of the Act, read with the Companies (Accounts) Rules, 2014 relating to the conservation of energy and technology absorption, foreign exchange earnings and outgo are given below:

(a) Conservation of energy:

(b) Technology absorption:

(c) Foreign Exchange earnings and Outgo:

Foreign exchange earnings and outgo is reported to be NIL during the financial year under review.

26. CORPORATE SOCIAL RESPONSIBILITY

Corporate Social Responsibility is an Integral part of our culture. The Company's CSR policy is committed towards CSR Activities in compliance with the requirements of Section 135 of the Act read with the Companies (Corporate Social Responsibility Policy) Rules, 2014, and as per the Schedule VII of the Act. The Board of Directors have constituted a Corporate Social Responsibility (CSR) Committee. The details of membership of the Committee and the meetings held are detailed in the Corporate Governance Report, forming part of this Report.

As per the provisions of Section 135 and rules made thereunder, if the company spends an amount in excess of the requirements then it may set off such excess amount during succeeding financial years after passing Board Resolution and any short fall in spending the CSR amount unless such amount relates to any outgoing project needs to be transferred to the fund specified in the Schedule VII of the Act within six months from the end of Financial Year.

Also, Company is required to take certificate from Chief Financial officer of the Company certifying that funds so disbursed have been utilized for the purposes and in the manner as approved in accordance with the Rule 4 of the Companies (Corporate Social Responsibility Policy) Rules, 2014. In compliance with the same, company has received certificate from Mr. Aditya Baid, Chief Financial Officer of the Company certifying that funds so disbursed are utilized for the purposes and in the manner as approved by the Board of Directors.

A detailed breakup of expenditure carried out and other details related to CSR activities has been disclosed in the Annual Report on Corporate Social Responsibility annexed with Board's Report as Annexure-II.

The CSR Policy, approved by the Board, is available on the website of the Company, the same can be accessed through web link https://www.baidfinserv.com/wp-content/uploads/2023/05/Policy/18.%20Corporate-Social-Responsibility-Policy.pdf?_t=1684581018

27. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS/COURTS/ TRIBUNALS

There were no significant and material orders passed by the Regulators or Courts or Tribunals during the year impacting the going concern status and the operations of the Company in future pursuant to Rule 8 (5) (vii) of the Companies (Accounts) Rules, 2014 .

28. VIGIL MECHANISM/ WHISTLE BLOWER POLICY

In line with the Section 177(9) of the Act and Regulation 22 of SEBI Listing Regulations, and the principles of good governance, the Company has devised and implemented a vigil mechanism, for directors and employees in the form of 'Whistle-Blower Policy' to report concerns regarding the unethical behavior, suspect or actual fraud, violation of code of conduct of the company. Detailed information on the Vigil Mechanism of the Company is provided in the Report on the Corporate Governance which forms part of the Annual Report.

The policy is available on the website of the Company and can be accessed through the Web Link https://www.baidfinserv.com/wp-content/uploads/2023/05/Policy/14.%20Whistle%20Blower%20Mechanism%20Policy.pdf?_t=16845 81010

29. EXTERNAL RATINGS

The credit ratings continue to reflect your Company's healthy earning profile, adequate capitalization, strong net worth base and steady improvement in its scale of operations. During the Financial Year under review, your Company has been re-affirmed credit rating by CARE Ratings, vide its letter dated September 27, 2023 in respect of bank facilities. The detail of which are as follows:-

30. DISCLOSURE ON SECRETARIAL STANDARDS:

During the period under review, applicable Secretarial Standards, i.e. SS-1 and SS-2, relating to

‘Meetings of the Board of Directors' and ‘General Meetings', respectively, issued by The Institute of Company Secretaries of India have been duly followed by the Company and the Company have devised proper systems to ensure compliance with the provisions of all applicable Secretarial Standards and that such systems are adequate and operating effectively.

31. RBI COMPLIANCES

Your Company is a Non-Banking Non Deposit Taking Non Systemically Important Investment and credit Company ("NBFC-ICC"), and continues to comply with the applicable regulations and guidelines of Reserve Bank of India and provisions as prescribed in Master Direction Reserve Bank of India (Non-Banking Financial Company Scale Based Regulation) Directions, 2023 as amended from time to time.

The Company has been identified for categorisation as NBFC-Base Layer under Scale Based Supervision Regulation (SBSR), a Revised Regulatory Framework for NBFCs

Further, your Company has complied with all the rules and procedure as prescribed in above mentioned master directions and any other circulars & notifications, time to time, issued by Reserve Bank of India.

32. PARTICULARS OF REMUNERATION OF DIRECTORS, KMPs AND EMPLOYEES

(A) The statement containing names of employees in terms of remuneration drawn and the particulars of employees as required under Section 197(12) of the Act read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is provided in a separate Annexure III forming part of this report.

(B) The ratio of the remuneration of each Director to the median employee's remuneration and other details in terms of sub-section 12 of Section 197 of the Act read with Rule 5(1) of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, are forming part of this report as Annexure IV.

33. MANAGING DIRECTOR AND CFO CERTIFICATE

The Chairman and Managing Director and the Chief Financial Officer of the Company give annual certification on financial reporting and internal controls to the Board in terms of Regulation 17(8) of the Listing Regulations. The Chairman and Managing Director and the Chief Financial Officer also give quarterly certification on financial results while placing the financial results before the Board in terms of Regulation 33(2) of Listing Regulations. The annual certificate given by the Chairman and Managing Director and the Chief Financial Officer is published in this Report.

34. PREVENTION OF INSIDER TRADING

Pursuant to the provisions of the Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015 ("PIT Regulations"), as amended, the Board has formulated and implemented a Code of Conduct to regulate, monitor and report trading by its designated person and other connected person and Code of Practices and Procedures for fair disclosure of Unpublished Price Sensitive Information. The trading window is closed during the time of declaration of results and occurrence of any material events as per the code. The same is available on the Company's website and can be accessed through web link. https://www.baidfinserv.com/wp-content/uploads/2023/05/Policy/22.%20Prohibition-Of-Fradulent-Un-FairTrade-Practice-relating-to-Securities-Market.pdf?_t=1684581018

Further, as per the provisions of Regulation 3 of Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015 the structured digital database (SDD) is maintained by the Company in Orion Legal Compliance Software for the purpose of maintaining record of unpublished price sensitive information ("UPSI") shared with various parties on need to know basis for legitimate purposes with date and time stamp containing all the requisite information that needs to be captured in SDD.

35. COMPLIANCE WITH THE CODE OF CONDUCT AND ETHICS

In compliance with the Listing Regulations and Act, the Company has framed and adopted a code of conduct and ethics ("the code"). The code is applicable to the members of the Board, the executive officers and all the employees of the Company.

All the members of the Board and Senior Management Personnel have affirmed compliance to the code for the Financial Year ended on March 31, 2024 and a declaration to this effect signed by the

Chairman and Managing Director forms part of the Corporate Governance Report as Annexure I.

36. DISCLOSURE OF ACCOUNTING TREATMENT

The Financial Statement of the Company for FY 2023-24have been prepared with the applicable accounting principles in India and the mandatory Indian Accounting Standard (‘Ind-AS') as prescribed under Section 133 of the Act read with the rules made there under.

37. DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to sub section 3 (c) of Section 134 of the Act, the Board of Directors of the Company hereby state and confirm that:

i. in the preparation of the annual accounts for the year ended on March 31, 2024, the applicable accounting standards have been followed and there are no material departures from the same; ii. the Directors have selected such accounting policies and applied them consistently and made judgments 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 ended on March 31, 2024 and of the profit and loss of the Company for that period;

iii. the Directors have taken proper and sufficient care 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;

iv. the Directors have prepared the annual accounts on a going concern basis;

v. the Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and

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

38. DISCLOSURE OF CERTAIN TYPE OF AGREEMENTS BINDING ON COMPANY

There are no agreement impacting management or control of the Company or imposing any restriction or create any liability upon the Company as specified in Schedule III, Para A, Clause 5A of Listing Regulations.

39. OTHER DISCLOSURES

Other disclosures with respect to Board's Report as required under the Act, Rules notified thereunder and Listing Regulations are either NIL or Not Applicable.

40. ACKNOWLEDGEMENTS

Your Board acknowledges with appreciation, the invaluable support provided by the Reserve Bank of India, Securities and Exchange Board of India, Ministry of Corporate Affairs, Central Registry of Securitisation Asset Reconstruction and Security Interest of India, Bankers & Lenders, Company's shareholders, auditors, advisors, business partners, all its customers for the patronage received from them including officials there at from time to time. The Board would also like to thank the BSE Limited, National Stock Exchange of India Ltd., National Securities Depository Limited, Central

Depository Services (India) Limited, MCS Registrar and Share transfer Agent (Registrar and Share Transfer Agent) and the Credit Rating Agency(ies) for their continued co-operation.

Your Board records with sincere appreciation the valuable contribution made by employees at all levels and looks forward to their continued commitment to achieve further growth and take up more challenges that the Company has set for the future.