Cholamandalam Financial Holdings Ltd

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Management Discussion and Analysis

Dear Shareholders,

Your Directors take pleasure in presenting the 75^th Annual Report together with the audited financial statements of the Company for the financial year (‘FY') ended March 31, 2024.

COMPANY OVERVIEW

Cholamandalam Financial Holdings Limited (‘CFHL') is primarily an investment company holding investments in its subsidiary/associate/joint venture and other group companies. CFHL is registered as a non-deposit taking Systemically Important Core Investment Company (‘CIC') pursuant to the receipt of Certificate of Registration dated January 6, 2020, issued by the Reserve Bank of India (‘RBI') under section 45-IA of the Reserve Bank of India Act, 1934. Pursuant to the Scale Based Regulatory Framework for NBFC's notified by RBI, the Company being a CIC falls under the category of Middle Layer NBFC (‘NBFC-ML').

CFHL holds substantial investments in the following financial services/risk management companies of the Murugappa Group (hereinafter collectively referred as ‘the group companies').

• Cholamandalam Investment and Finance Company Limited (‘CIFCL'), a non-banking finance company engaged in lending business offers vehicle finance, home loans, loan against property, SME loans, secured business and personal loans (SBPL), consumer & small enterprises loans (CSEL) and a variety of other financial services to customers;

• Cholamandalam MS General Insurance Company Limited (‘CMSGICL'), engaged in general insurance business offers a wide range of insurance products that include Motor, Health, Property, Accident, Engineering, Liability, Marine, Travel and Crop insurance for individuals and corporates;

• Cholamandalam MS Risk Services Limited (‘CMSRSL') offers comprehensive Risk Management and Engineering solutions.

MACRO ECONOMIC ENVIRONMENT

Global economy witnessed elevated inflation across various countries in the year 2023. High inflation rates paired with other adverse factors dampened the growth pushing the world economy closer to its pre-pandemic levels. Headwinds from elevated price levels which caused significant strain in consumer demand, weaker trade, and spates of geopolitical tensions in addition to triggering supply chain disruptions tested the resilience of the global economy. With implementation of prudent policy measures, inflation rates have begun to decline and risks to the outlook are becoming more balanced. As per the IMF estimates, global inflation is expected to drop to 5.2% in 2024 from 8.7% in 2022. The global economic outlook is expected to moderate in 2024. With potential upsides to the outlook being faster decline in inflation levels leading to Central banks moving forward with policy easing, slower than assumed withdrawal of fiscal support, recovery in China and supply side reforms. Supply chain disruptions and ongoing geopolitical tensions pose downside risks to the economic growth besides extreme weather-related events. In this context, economists have projected global GDP growth at 3.1% in 2024, the same as in 2023, followed by a slight pick-up to 3.2% in 2025.

Despite the challenging macro environment, the Indian economyhasbeenresilientduringtheyearandmaintained its stature as the fastest growing country in the world. The GDP gap, compared with pre-pandemic levels, continues to narrow as the recovery gains momentum. The economic growth in FY 24 was largely driven by strong tax revenue collections, increased government capital spending, firmness in domestic demand amid sustained levels of business and consumer confidence. On the supply side, mining, manufacturing, construction and certain services had a stronger output. Improved domestic and global demands and rising prices led to robust production of several minerals including coal, natural gas, and iron ore. Buoyant automobile sales, growth in passenger traffic, robust GST collections, rising electricity demand all reflect the continuing domestic demand. Strong growth in the manufacturing sector was steered mainly by easing of global commodity prices across energy, metal, and food categories. The agriculture sector contracted on account of uneven and deficient monsoon and is likely to remain subdued while the construction sector gained from infrastructure spending by the Government and buoyant real estate sector. The Consumer Price Index (CPI) based inflation moderated in FY 24 albeit with heightened volatility due to food price shocks.

Against this backdrop, the growth projection for Indian economy in FY 24 stands revised to 8% from the earlier estimate of 7.2%. GDP growth in the fourth quarter is expected to moderate due to uncertainties related to general elections and modest consumption growth. Inflation and policy rates peaked during the year. The RBI's tighter monetary policy stance has helped to anchor inflation expectations, despite recurrent supply-side shocks. Headline inflation eased to 4.9% in March 2024, aided by lower import price growth and softer input prices, and core inflation stood at 3.2%. Domestic GDP growth is projected @ 6.6% in FY 25 backed by increased household consumption, positive fixed investment prospects, and greater integration into global supply chains aided by government capital expenditure focus, stronger bank and corporate balance sheets and improved business sentiments. Headwinds to the growth outlook include geopolitical tensions, volatility in international financial markets and geoeconomic

STANDALONE FINANCIAL RESULTS

SHARE CAPITAL

The paid-up equity share capital of CFHL as on March 31, 2024 was Rs.18.78 Crore.

DIVIDEND

The Board of Directors have recommended a final dividend at the rate of 55% i.e., Rs.0.55/- per equity share of face value of Rs.1/- each for the year ended March 31, 2024.

APPROPRIATIONS

The Company has transferred a sum of Rs.12.35 Crore (previous year: Rs.11.58 Crore) to Special Reserve under section 45-IC of the Reserve Bank of India Act, 1934 for the year ended March 31, 2024.

BUSINESS ENVIRONMENT

CFHL earns revenue primarily by way of dividend income from investments held in group companies. An overview of the financial services sector in which the Company operates along with a business update of group companies in FY 24 is summarised in the following paragraphs.

Management Reports Financial Statements

NBFC Industry & Business Update

India's financial sector is a highly diversified one comprising commercial banks, insurance companies, non-banking financial companies, co-operatives, pension funds, mutual funds and other smaller financial entities. The sector is dominated by banking and non-banking financial companies (‘NBFCs') which has witnessed remarkable transformations since its emergence, with segments such as housing finance, microfinance and consumer finance contributing to its expansion. After a moderation in growth post the pandemic, NBFCs are back on track with an expected credit growth of 13~14% in FY 24. The sector has grown significantly, with a number of players with heterogeneous business models starting operations. The increasing penetration of neo-banking, digital authentication, rise of UPI and mobile phone usage as well as mobile internet has resulted in the modularisation of financial services. The growth momentum is expected to continue in the current year also. The outlook for the industry remains positive as the country strides on its growth trajectory leading to higher credit demand. The growth in credit is expected to be broad based across products and segments with key risks being elevated interest rates and inflation.

Cholamandalam Investment and Finance Company Limited (‘CIFCL'), an associate company of CFHL, was incorporated in 1978 as the financial services arm of the Murugappa Group. CIFCL is registered with RBI as an NBFC- Investment and Credit Company and is classified as an NBFC in Upper Layer (‘NBFC-UL') under the Scale Based Regulatory Framework for NBFCs. The company continues to be one of the leading, comprehensive financial service providers offering vehicle finance, home loans, loan against property, SME loans, secured business & personal loans, consumer & small enterprises loans and a variety of other financial services to customers.

Vehicle Finance (‘VF')

CIFCL's Vehicle Finance business comprising diversified portfolioviz.,Two-Wheelers,Three-Wheelers,Commercial Vehicles, Passenger Vehicles, Used Vehicles, Tractors and Construction Equipment, continues to be the major segment contributing 58% of its aggregate Assets under Management (‘AUM') as of March 31, 2024.

At the industry level, the Indian commercial vehicle (‘CV') reported a flat growth in FY 24 after two years of strong growth and a high base effect. The Heavy Commercial Vehicle and Light Commercial Vehicle segment had a growth of 2% and 3% respectively for FY 24 while the Small Commercial Vehicle segment had a 6% de-growth in FY 24. The growth in commercial vehicle segment is expected to continue at a single digit growth in FY 25. The Passenger vehicle (Car & MUV) segment had a growth 8% in FY 24, driven by replacement demand and the launch of new models especially in the MUV segment. The Two-wheeler industry had a growth of 13% in FY 24 and this segment is expected to grow at a moderate pace in the coming year supported by a recovery in rural demand. The Construction Equipment industry had a growth of 23% in FY 24 driven by an accelerated government spend on infrastructure. There might be a moderation in demand in the near future after two years of double-digit growth. The Tractor industry had a de-growth of 6% in FY 24 due to the high base effect of the previous year. This segment is expected to grow at a modest pace with expectations of normal monsoon and an uptick in rural demand.

The VF business disbursements of CIFCL were at an all time high of Rs.48,348 Crore in FY 24 as against Rs.39,699 Crore in the previous year with a growth of 22% and profit before tax (‘PBT') for the year was Rs.2,532 Crore as against Rs.2,272 Crore in the previous year, a growth of 11%. The division will focus on increasing its reach in Tier 4 & Tier 5 markets there by de-risking business concentration and enabling better spread of field force for new acquisition of customers, collection coverage and efficiency. Retaining its existing customers through innovative technology and mobile platforms with limited intervention of field force will be a key focus. Analytics-based credit underwriting with pre-approved offers for both new and existing customers will help in faster loan delivery. The business will bring in AI based collection monitoring and digital modes of collection in early buckets to curtail flows and reduce costs. The Gaadi Bazaar platform helps in improving customer experience for all service-related queries, cross sell and vehicle discovery needs.

Loan against Property (‘LAP')

The industry size of the Loan Against Property segment stands at around Rs.10 lakh Crore. Out of this, NBFCs

& HFCs have a market share of 46%. The NBFC LAP portfolio is expected to grow by 21-23% in FY 25 driven by a favourable economic environment and increase in business activities.

Assets Under Management (‘AUM') for CIFCL's LAP business grew by 38% to Rs.29,859 Crore (previous year: Rs.21,588 Crore) and disbursements registered a growth of 46% to Rs.13,554 Crore (previous year: Rs.9,299 Crore). Pan-India geographical penetration into new markets, introduction of localized credit policy in line with market developments, increased contribution from rural branches have led to this growth. The business continues to focus on a systematic approach to build a healthy portfolio mix, with more than 78% of the portfolio being residential properties and an average loan ticket size of less than Rs.50 lakhs. Average Loan-to-Value (LTV) ratio at origination is consciously maintained at 50% levels which provides adequate security cover to the business. The asset quality of this business has shown steady improvement with the net credit losses and stage 3 assets coming down significantly with consistent improvement in collection efficiency. Stage 3 assets of LAP business stand at 2.4% as of March 2024 compared to 4.02% as of March 2023.

Housing Finance

The size of the Affordable Housing Finance segment (AHFC) with an industry size of Rs.1 lakh crore continues to deliver a robust growth of 26%. The growth is spurred by government initiatives aimed at achieving "housing for all." AHFCs constitutes 13% of the housing finance industry. This is expected to maintain a healthy growth rate of 12-14% per annum on the back of a revival in demand for affordable housing.

As of March 31, 2024, the HL business had 1.10 lac live accounts (58% growth Y-o-Y) with an AUM of Rs.13,404 Crore (59% growth Y-o-Y). 97% of the portfolio is from Tier II, III, IV cities and towns. The disbursements grew by 66% Y-o-Y from Rs.3,830 Crore in FY 23 to Rs.6,362 Crore in FY 24. The target group remains the lower middle income group customer. The average ticket size is Rs.13 lakhs with an average LTV of 50%. 83% of the portfolio comprises business owners with semi-formal income and significant business vintage and 24% of customers are first-time borrowers. The HL business leverages its strength in reaching out and underwriting lower and middle-income borrowers across the country, penetrating to the smallest villages and towns. CIFCL continues to build a strong ecosystem of channel partners, coupled with its digital offerings for customer service and on-boarding making it a trustworthy choice for customers pan India.

Consumer & Small Enterprise Loan (‘CSEL')

In the Indian lending market, the personal and professional loans sector stands out as one of the fastest-growing segments. This sector experienced a surge in activity following the pandemic and is expected to further grow. Despite this rapid expansion, there remains a significant portion of individuals in India who lack access to formal sources of credit. In addition, the demand for credit within the MSME sector is consistently increasing year by year. Recognizing this pressing need for greater financial inclusion in both the consumer and small enterprises sector, CIFCL entered this space in November 2021. Considering the increasing size and scope of digital lending in India and the growth in the consumer durable lending space, the CSEL division added the direct-to-consumer journey and consumer durable lending business to its portfolio. The CSEL division offers collateral-free personal and professional loans to both salaried and self-employed professionals, as well as business loans tailored for small enterprises in the manufacturing, trading, and services sectors. It also offers consumer durable loans for mobile phones. As of March 31, 2024, the CSEL business has been serving close to 12 lakh customers with an AUM of Rs.11,281 Crore. The business has expanded across the country covering 25 states and 4 union territories with over 205 area offices. The division has active strategic partnerships with eight prominent Fintech firms, in order to enhance financial inclusion, particularly among economically active individuals who lack sufficient access to formal credit. The division's primary strengths encompass a transparent end-to-end digital process, an exceptional customer experience journey, robust data-driven underwriting, and risk management capabilities.

Small and Medium Enterprises (‘SME')

The Micro Small and Medium Enterprises (MSMEs) sector is a major contributor to the socio-economic development of the country. In India, the sector has gained significant importance due to its contribution to Gross Domestic Product (GDP) of the country and exports. The sector also offers entrepreneurship development especially in semi-urban and rural areas of India. While traditional banks have focused on MSME lending through innovative models such as co-lending, NBFCs have emerged as lenders, growing their MSME loans over three times faster. NBFCs offer custom-fit financing solutions, a major advantage for MSMEs with unique needs.

As of March 31, 2024, the SME business has around 20,000 MSME customers with an AUM of Rs.5,000 Crore. The business has expanded across the country covering 20 states with over 70 branches. The division has entered into strategic partnerships with more than 16 OEMs and 10 leading Fintech companies to drive greater financial inclusion in the market. With growing Small and Medium Enterprises ecosystem, CIFCL's SME loans business division provides bouquets of products to meet the requirements of working capital and capex of SMEs viz., Secured Term loan, Equipment funding, Vendor Invoice discounting Channel finance and Loan Against Securities.

Secured Business and Personal Loan (‘SBPL')

The Indian lending landscape faces a unique challenge: a segment that remains largely untapped despite possessing collateral and repayment capacity. This segment, distinct from regular Loan Against Property (LAP) borrowers, encounters barriers due to financial, geographical, and profile-related norms set by prime LAP lending institutions. India faces high levels of financial exclusion due to factors such as low income, lack of financial literacy, high costs, and poor infrastructure. As a result, many people still rely on informal sources of credit, such as relatives, money lenders, and landlords.

SBPL offers collateral backed business and personal loans on the basis of the credit assessment and cashflow projections of these businesses. As of March 31, 2024, the SBPL business had crossed 34,000 live accounts with an AUM of Rs.1,404 Crore. The average ticket size is around 4.36 lacs with average tenure of 6 years. This business has digitised the entire customer loan journey for a hassle-free loan.

Outlook

Commercial Vehicle industry growth will largely come from improvement in macroeconomic environment and healthy traction in underlying industries such as mining, infrastructure, and construction. Credit demand across majority of retail assets to remain strong. Asset quality to remain at healthy levels. Favorable demographics, moderating affordability, and low inventory result in sustained end-user demand in residential real estate. The underpenetrated market and the Government's thrust on ‘housing for all' are likely to support growth. Micro MSME segment is leading growth within India's MSME credit market and credit growth momentum to continue in FY 25.

General Insurance Industry & Business Update

In FY 24, the insurance regulatory front was vibrant in terms of the reforms push, imperative push for insurance penetration (Bima Vahak, state insurance plans, insurance awareness campaigns), policy holder protection push (100% cashless, price revision restraint on individual health covers, approach to internal ombudsmen), consolidation of several regulations into homogenous regulations with tweaks, fillip for domestic reinsurers (both Indian and Foreign reinsurance branches), digital push (Bima Sugam, national health claims exchange etc. A key change, effective from April 1, 2024 relates to de-notifying tariff for Motor, Fire, Engineering Marine (Tea tariff) lines which will enable insurers to innovate on products with differential protection, wordings and clauses, deductible levels etc.

The Gross Direct Premium of multi-line non-life insurers (excluding Standalone Health & Specialized insurers) was reported at around Rs.2454 billion and registered a growth of around 14.2% over the previous year. Amongst various lines of businesses, motor insurance registered a growth of 12.9% while the fire line of business grew by 7.2%. Growth in the health and personal accident lines for general insurers was placed at 17.6% and 11.7% respectively. The rise in investment income aided by the rising interest rate environment and buoyant equity markets helped insurers to register overall operating profits.

Cholamandalam MS General Insurance Company Limited (‘CMSGICL'), the insurance subsidiary of CFHL, is registered with the Insurance Regulatory and Development Authority of India (‘IRDA') to carry on general insurance business. CMSGICL offers a wide range of insurance coverage including motor, travel, health, accident, home and other types of insurance for individual and corporate customers.

CMSGICL achieved a gross premium of Rs.7,598 Crore, a growth of 22.5% which helped in growing its market share to 3.07% (among general insurance players). The company grew its business operations across all lines of business. The company re-entered the crop insurance business during the year and grew its business operations across channel categories of bancassurance, agents/POSPs, brokers, MISPs, CSC etc. CMSGICL re-launched its program for providing the thrust on building the agency channel across metro, semi-urban and rural markets. The company entered new OEM programs added to its bancassurance partners besides renewing all its relationships. Business line diversity was secured by growing business from commercial and SME lines, crop insurance and growth in retail health space.

Motor Insurance

The motor insurance business registered a growth of over 14.2% during the year as compared to the industry growth of 12.9%. The premium pricing in motor own-damage witnessed severe pressure with discounts across vehicle categories staying at higher levels. In motor third party, the pricing remained static even as the industry witnessed inflation in medical costs as well as continuous increase of the minimum wage levels across all states in the country. The company continues to exercise utmost care in its choice of sub-segments, geographies.

Property and Casualty Insurance

In the fire line of business, CMSGICL registered a growth of 8.2% as against the industry growth of 7.2% leading to a market share of 2.79% Marine and Group Accident lines of businesses also witnessed improved performance with increase in the levels of economic activity and focused sourcing. The miscellaneous lines of insurance business grew well during the year. The company registered growth across all its business verticals of Indian Commercial, SME, Japanese & Korean and Bancassurance. CMSGICL continues to follow disciplined underwriting and prudent risk selection in the highly demanding environment.

Health, Accident and Travel Insurance

The overall health, accident and travel volumes grew by more than 23.6% during the year with stronger growth in retail health. Even as retail indemnity business continues to scale up, the bancassurance led health benefit and accident product grew faster supported by buoyant economic activity. New health products - both indemnity and benefit were added during the year besides stepping up on its distribution build of both POSP as well as channel partners. The company continues to strengthen its underwriting framework with intelligent use of technology for its risk selection, upsell and cross-sell initiatives.

Crop Insurance

The company operates the crop insurance in a cluster in Maharashtra under the 80-110 loss corridor scheme. The indifferent monsoon in the Kharif season resulted in higher incidence of claims but the experience in the Rabi season was better. Chola MS will continue to explore opportunities for adding to the business as more States in the country enter the program.

Reinsurance (RI)

Reinsurance rates rose sharply in FY 24 in the wake of global risk events, rising inflation etc. In the Indian context, the multiple natural catastrophic events by way of Cyclone Biporjoy, Northern Indian floods, Cyclone Michaung, Southern Tamil Nadu inundation had an impact on the industry but with higher deductibles, the impact was soft for reinsurers. Renewal for FY 25 was marked by availability of capacity and flat/marginal improvement in terms for insurers. During the year, the Company's proportional and non-proportional treaties generated surpluses for the reinsurers for the year. The Company could secure enhanced capacity, increase the scope of coverage on some treaties. The reinsurance placements for FY 25 were over-subscribed and placed with diversified and well rated reinsurers.

Claims functions

The year under review witnessed the claims management function stepping up speed of disposal while handling larger volumes with efficiency and productivity. The company continues its journey in digitization of its claims processes across lines of businesses.

Harnessing efficiencies for severity control across all lines, automation for speed and operational controls, proactive approach to servicing for building transparency and satisfaction levels of customers continue to be the focus area of the insurance business.

Outlook

The general insurance industry is poised to grow in the context of strong economic growth of the country. The regulatory changes and the thrust by the Regulator on attaining insurance penetration and for stepping insurance awareness, particularly in the rural markets should help in growth. Headwinds for the industry include the pricing pressures across product lines/segments and the possible impact from the de-tariff of fire/engineering/ motor lines as to product wordings. Higher inflation led by oil prices in the context of geo-political conflicts could impact customer sentiment and claims costs. Amongst the tail winds are the infrastructure spend thrust from the Government, expected credit offtake from the banks, the prediction of a normal monsoon, the re-entry of a few more states into the PMFBY scheme and the continued buoyancy in automobile sales. The interest rate environment, expected to sustain for the better part of the year, will augment the investment income for all players in the industry.

CMSGICL will continue its strong growth path by adding new channel partners, expand into new markets, enhance its focus on renewals besides launching new products across lines of businesses. The company is committed to further tightening its expense of management levels by a judicious mix of channels, product sub categories and rationalise commission structures linked to inherent profitability. CMSGICL will continue to operate as a prudent insurer in its choice of product portfolio and segments to fully live to its image of a trustworthy insurer in its claim management processes.

Digital/Technology Initiatives

Technology has become ingrained as a key driver in connecting people across various walks of life. Aligned with the trend, digital transformation continues to be the focus area of the group. Various initiatives and technology tools are deployed for automation of repetitive activities across functions wherever opportunity exists. Digital/Technology initiatives implemented by CMSGICL during the year include – enablement of new product launches and upgrades in API integrations, enablement of digital journey and integrations with new bancassurance partners, partnership tie-ups with NBFCs, OEMs, broking intermediaries etc., integration of health claims module with the National Health Claims Exchange (NHCX), ABHA integration and enablement of CIS (Customer Information Sheet). Further, several other operating measures were put in place relating to information security and running awareness campaigns for employees.

With regard to lending business, CIFCL aims to provide seamless digital experiences to customers while eliminating non-value-added activities and improving process execution through technology tools and automation. Over the last fiscal year, CIFCL has adopted an integrated application approach for employees to have a better application infrastructure. Several enhancements have been made to the application platform to upgrade and enable the executives to provide a smoother onboarding experience for field executives. In line with its vision of a digitally driven business, the integrated super app – Chola One was launched as a face of the CSEL business. As part of continued focus on vehicle ecosystem, the company continues to enhance the ease of experience for dealers, through its Gaadibazaar offering. Gaadibazaar offers services to buy, sell new, and used cars, auction repossessed vehicles, and serve vehicle brokers gain better visibility of their products. To manage risks related to external technology partners, the company has put in place a team of in-house developers to promote and enable faster turnaround to its business. The increasing reality of being digital brings with it the challenges around cyber security. The company has been building and investing in the people, processes, and tools necessary to be able to identify and mitigate the risks around cyber security to protect the increasing volume of data and digital assets built in multiple layers of increasing complexity. Further, the company continues to adopt data privacy practices in every point of storage and use of customer data to comply with regulatory norms on data privacy.

Risk Management Services - Business Update

Cholamandalam MS Risk Services Limited (‘CMSRSL'), is a joint venture entity of the Murugappa Group and Mitsui Sumitomo Insurance Group, Japan. Established in the year 1994, CMSRSL provides risk management and engineering solutions in the areas of safety, health and environment. CMSRSL is part of the Inogen Alliance. Inogen Alliance is a global network of environment, health, safety and sustainability consulting companies working together to provide one point of contact to guide multinational organizations to meet their global commitments locally.

During the year under review, the company expanded its service offering by launching strategic projects in hydrogen safety, BRSR, and other sustainability services, and has executed projects in respective areas. The company has expanded its footprint to around 100+ sites across the country, including resources deployed at various client project sites. Around 139 construction safety professionals and 140 logistics safety specialists were deployed at various locations for different companies. The company deepened partnerships with key allies like Inogen, BPC, and EIC-Dubai and strengthened ties with JV partner MS&AD during FY 24. Significant steps were taken towards digitalization by signing agreements with MapMyIndia, Denxpert, and Crion Technologies. The environment and sustainability division were further strengthened through engagement and gaining additional certification from Alliance Water Stewardship. The company also partnered with IIM Indore to launch a Young Leaders Program for young managers.

CMSRSL continues to serve Cholamandalam MS General Insurance Company Limited and its clients through value-added services like Thermography, Safety Audits, and Cargo Loss minimization studies. The company has around 430+ resources with a strong technical team of multidisciplinary and certified professionals having exposure to domestic and international markets. The JV Partner, Mitsui Sumitomo Insurance Company Limited, Japan, continues to support the company by introducing Japanese companies in the Indian market for risk management services and assisting in identifying potential partners in Digital EHS front. The company plans to strategically expand service offerings into emerging areas like Ethanol, Biological Safety, Biodiversity, and Climate & Water Risk Assessments in FY 25. This expansion builds upon the company's established expertise in providing engineering solutions for safety, risk, and sustainability. Furthermore, the company recognizes the growing importance of Environmental, Social, and Governance (ESG) reporting. By collaborating with its Inogen partners, the business is focused to deepen its capabilities in net zero and zero waste to landfill consulting, aiming to become a prominent player in India's ESG market. CMSRSL plans to enter into new areas related to Ethonol, Biological Safety related services, Biodiversity and Climate & Water Risk Assessments.

CONSOLIDATED FINANCIAL RESULTS

During the year the Company has not made any investments in its subsidiaries. There has been no change in the nature of business of the company and the group companies during the year. The business performance of the group companies has been furnished in earlier paragraphs of this report.

A report on the performance and financial position of each of the group companies as per section 129(3) of the Act read with the Companies (Accounts) Rules, 2014, in the prescribed form AOC-1 is annexed to this Report as Annexure I. The consolidated financial statements of the Company prepared in accordance with the Companies Act, 2013 (‘the Act') and the relevant Accounting Standards, forms part of the annual report.

The annual report containing standalone and consolidated financial statements will be uploaded on the Company's website, www.cholafhl.com. Annual accounts of the group companies will also be uploaded on the Company's website and be made available for inspection by shareholders through electronic mode until the date of the Annual General Meeting (‘AGM').

FINANCIAL REVIEW - SUBSIDIARY/ASSOCIATE/ JOINT VENTURE COMPANIES

CFHL earned an income of Rs.86.00 Crore (previous year: Rs.83.76 Crore) and profit before tax was Rs.79.01 Crore (previous year: Rs.73.86 Crore) for the financial year ended March 31, 2024. Aggregate investments stood at Rs.1,279.31 Crore (previous year: Rs.1,280.12 Crore) as on March 31, 2024. During the year, the Company repaid Rs.50 Crore of Matured Non-Convertible Debentures (‘NCDs') and there were no outstanding NCDs as on March 31, 2024.

Cholamandalam Investment and Finance Company Limited (‘CIFCL')

The Company holds 44.39% in the paid-up equity share capital of CIFCL as on March 31, 2024 and has de-facto control as per the principles of Ind AS 110. Accordingly, CIFCL is treated as a subsidiary for the purpose of consolidation of financial statements. The securities of CIFCL are listed and traded on the National Stock Exchange of India Limited (NSE) and the BSE Limited (BSE).

The Assets under Management (‘AUM') grew by 37% to Rs.1,53,718 Crore as at March 31, 2024 (previous year: Rs.1,12,782 Crore). Loan disbursements aggregated to Rs.88,725 Crore (previous year: Rs.66,532 Crore) registering a growth of 33% during the year. Profit after tax grew by 28% to Rs.3,423 Crore (previous year: Rs.2,666 Crore). Investment portfolio of CIFCL as at end of FY 24 was Rs.4,137 Crore including investments in government securities of Rs.1539.07 Crore.

The company maintained a comfortable ALM position with no negative cumulative mismatches across all time buckets. As at end of FY 24, the capital adequacy ratio stood at 18.57% as against the minimum regulatory requirement of 15%. To augment capital adequacy for its growing balance sheet and enhanced regulatory requirements, CIFCL launched a composite QIP issue of equitysharesofRs.2,000Croreandcompulsorilyconvertible debentures of Rs.2,000 Crore, overall aggregating to Rs.4,000 Crore and the issue was oversubscribed. Commercial Papers aggregating to Rs.17,330 Crore were raised during FY 24 of which Rs.13,930 Crore were repaid. Outstanding NCDs were Rs.18,622 Crore and Tier II borrowings stood at Rs.4,974 Crore as on March 31, 2024.

CIFCL paid an interim dividend of Rs.1.30 (65%) per equity share of face value of Rs.2/- each for FY 24. The Board of CIFCL has recommended a final dividend of Rs.0.70 (35%) per equity share for FY 24, subject to their shareholders' approval.

The subsidiary companies of CIFCL are Cholamandalam Securities Limited (‘CSEC'), Cholamandalam Home Finance Limited (‘CHFL') and Payswiff Technologies Private Limited (‘Payswiff'). CSEC is engaged in stock broking and investment advisory services. Payswiff is engaged in the business of offline payment aggregator services and provides e-commerce solutions. The associate companies of CIFCL are Vishvakarma Payments Private Limited and Paytail Commerce Private Limited (till March 21, 2024).

CSEC achieved a gross income of Rs.156.85 Crore (previous year: Rs. 51.54 Crore) and profit before tax of Rs.84.20 Crore (previous year: Rs.8.68 Crore) for the year ended March 31, 2024. CHFL recorded a gross income of Rs.186.05 Crore (previous year: Rs.81.87 Crore) and made a profit before tax of Rs.63.25 Crore (previous year: Rs.7.66 Crore) for the year ended March 31, 2024. Payswiff recorded a gross consolidated income of Rs.135.57 Crore (previous year: Rs.230.27 Crore) and made a loss of Rs.2.17 Crore (previous year: loss Rs.12.03 Crore) for the year ended March 31, 2024.

Cholamandalam MS General Insurance Company Limited (‘CMSGICL')

CMSGICL is a joint venture between the Murugappa Group and Mitsui Sumitomo Insurance Company Limited, Japan. The Company holds 60% of the paid-up equity share capital of CMSGICL. The IRDAI has deferred the implementation of Ind-AS for insurance companies. Therefore, the accounts of CMSGICL have been converted as per Ind-AS for consolidation purposes and figures of CMSGICL reported in this annual report are under Ind-AS. CMSGICL achieved a gross written premium of Rs.7,542 Crore in FY 24 (previous year: Rs.6,407 Crore) and profit before tax was Rs.590 Crore (previous year: Rs.211 Crore). The investment portfolio of CMSGICL grew to Rs.16,538 Crore as at March 31, 2024 (previous year: Rs.14,271 Crore). The company took advantage of the rising interest rate environment to deploy its accretion/maturing funds at higher yields. The exposure to Central and State Government securities stood at 61.3% of the investment assets (previous year 65.1%). As of March 31, 2024, the company had nil non-performing assets in its investment portfolio. The solvency ratio of CMSGICL as on March 31, 2024, was 1.79 times as against the minimum regulatory requirement of 1.50 times.

With a view to conserving its resources and augment solvency ratio, the Board of CMSGICL has not recommended dividend for FY 24.

Cholamandalam MS Risk Services Limited (‘CMSRSL')

The Company holds 49.5% stake in CMSRSL. CMSRSL achieved an income of Rs.71.27 Crore (previous year: Rs.64.93 Crore) and profit before tax of Rs.8.18 Crore (previous year: Rs.9.19 Crore) for the year ended March 31, 2024. The Board of CMSRSL has recommended a final dividend of 30% i.e. Rs.3/- per equity share of face value of Rs.10/- each for FY 24.

DIRECTORS

Mr. B Ramaratnam (DIN: 07525213) has been re-appointed as an Independent Director for a second term of three consecutive years with effect from March 18, 2024 till March 17, 2027 vide a special resolution passed by the shareholders at the 74^th AGM held on August 10, 2023.

Mrs. Vasudha Sundararaman (DIN: 06609400), Independent Director, was appointed for a term of five consecutive years commencing from February 12, 2020, till February 11, 2025 and Mr. K Balasubramanian (DIN: 00137260), Independent Director, was appointed for a term of three consecutive years commencing from March 17, 2022 till March 16, 2025. In view of their current terms coming to an end on February 11, 2025, and March 16, 2025 respectively and based on the recommendation of the Nomination and Remuneration Committee, the Board recommends the re-appointment of Mrs. Vasudha Sundararaman and Mr. Balasubramanian as Independent Directors for a second term of three consecutive years each with effect from February 12, 2025 and March 17, 2025 respectively.

In the opinion of the Board, Mrs. Sundararaman and Mr. Balasubramanian continue to fulfill the criteria of independence prescribed in the Act and under the SEBI Listing Regulations for re-appointment as Independent Directors of the Company and that they are independent of the management. Necessary resolutions seeking shareholders' approval for re-appointment of Mrs. Vasudha Sundararaman and Mr. Balasubramanian as Independent Directors on the Board, forms part of the Notice convening the 75^th AGM.

As per the provisions of section 152 of the Act, Mr. M M Murugappan (DIN: 00170478) retires by rotation at the ensuing AGM and being eligible offered himself for re-appointment. The Board recommends the re-appointment of Mr. Murugappan as a director liable to retire by rotation and the resolution in this regard forms part of the Notice convening the 75^th AGM. Information as required to be disclosed under regulation 36(3) of the SEBI Listing Regulations, for re-appointment of director is provided in the Notice.

DECLARATION FROM INDEPENDENT DIRECTORS

The Independent Directors (‘IDs'), Mr. B Ramaratnam, Mrs. Vasudha Sundararaman and Mr. K Balasubramanian have submitted declarations stating that they meet the criteria of independence as required under the provisions of section 149(6) of the Act and regulation 16(1)(b) of the SEBI Listing Regulations. In the opinion of the Board, all the IDs possess integrity, expertise and relevant experience in their respective fields including the proficiency required to effectively discharge their roles and responsibilities in directing and guiding the affairs of the Company.

In terms of section 150 of the Act read with the Companies (Appointment & Qualification of Directors) Rules, 2014, the IDs of the Company have registered their names in the independent directors' data bank, created and maintained by the Indian Institute of Corporate Affairs (‘IICA'). The IDs are also required to pass an online proficiency self-assessment test conducted by the IICA within a period of two years from the date of inclusion of their names in the data bank, subject to exemption to individuals who fulfill the eligibility criteria prescribed under the said Rules. All the IDs are compliant with the requirement under the said Rules.

KEY MANAGERIAL PERSONNEL

Pursuant to the provisions of section 203 of the Act, Mr. N Ganesh, Manager & Chief Financial Officer and Mrs. E Krithika, Company Secretary are the key managerial personnel of the Company and there were no changes during the year. At the 74^th AGM held on August 10, 2023, the members approved the re-appointment of Mr. N Ganesh as the Manager for a further period of 3 years effective June 15, 2023.

STATUTORY AUDITORS

The shareholders at the 72^nd AGM held on August 4, 2021, appointed M/s. Sharp & Tannan Associates (‘S&T'), Chartered Accountants (Firm Registration No. 109983W) as the statutory auditors of the Company for a period of three years commencing from the conclusion of the 72^nd AGM till the conclusion of the 75^th AGM. Consequently, S&T retire at the conclusion of this AGM. The Auditors' Report issued by S&T for the year under review is unmodified and does not contain any qualification, reservation, or adverse remark. The statutory auditors have not reported any incident of fraud to the Audit Committee or the Board of Directors under section 143(12) of the Act during the year.

Pursuant to the provisions of section 139(2) of the Act and the rules made thereunder and the guidelines for appointment of statutory auditors for Banks and NBFCs dated April 17, 2021 issued by the RBI (‘RBI guidelines'), and based on the recommendation of the Audit Committee, the Board recommends the appointment of M/s. R.G.N Price & Co. (Firm Registration No. 002785S) as statutory auditors of the Company for a period of three years commencing from the conclusion of the 75^th AGM till the conclusion of the 78^th AGM. Necessary resolution seeking shareholders' approval for appointment of M/s. R.G.N Price & Co. as statutory auditors of the Company forms part of the Notice convening the 75^th AGM.

INTERNAL CONTROL SYSTEM AND INTERNAL AUDIT

Internal control system of an organisation is looked at as the key to its effective functioning. The Company has internal control systems in place commensurate with the nature of business and size of its operations, to ensure compliance with internal policies, regulatory matters and to safeguard reliability of financial reporting and its disclosures. An audit of systems and processes is conducted by the internal auditor of the Company. The internal audit is performed based on the audit plan approved by the Audit Committee annually. The internal audit report along with the observations and recommendations from the audit review are discussed and reviewed in the quarterly meetings of the Audit Committee. The Audit Committee evaluates adequacy and effectiveness of the internal controls, performance of the internal audit, recommends improvements and reviews the action taken.

FINANCE Deposits

The Company has not accepted any fixed deposits under Chapter V of the Companies Act, 2013 and as such no amount of principal and interest were outstanding as on March 31, 2024.

Particulars of Loans, Guarantees or Investments

The provisions of section 186 of the Act pertaining to investment and lending activities is not applicable to CFHL since the Company is an NBFC whose principal business is acquisition of securities. Information regarding investments made during the year is given in the financial statements. During the year the Company has not given any loans or guarantees under the provisions of section 186 of the Act.

Internal Financial Control Systems with reference to the Financial Statements

The Company has in place adequate internal financial controls to ensure reliability of financial and operational information and regulatory and statutory compliances. The Company's business processes are equipped with monitoring and reporting processes to ensure financial discipline and accountability. The internal financial control systems are monitored both by internal and statutory auditors of the Company. The statutory auditors of the Company have also certified the existence and operating effectiveness of the internal financial controls as on March 31, 2024.

Financial Ratios

The Company being an investment company does not carry on any business other than holding investments in its group companies. Dividend receipts from investee companies is the primary source of income. Key ratios of the Company are given in the table below:

The Company redeemed NCDs aggregating to Rs.50 Crore during the year. Therefore, there is a decrease in leverage ratio and debt equity ratio is not applicable. The increase in adjusted net-worth is on account of an increase in unrealised gains on investment in subsidiaries. The leverage ratio (maximum regulatory requirement: 2.5 times) and adjusted net worth ratio (minimum regulatory requirement: 30%) are computed in accordance with the Master Directions - Core Investment Companies (Reserve Bank) Directions, 2016 (‘Master Directions of RBI').

RISK MANAGEMENT

Risk management is a process to identify and manage threats that could have an impact on the operations of the Company. Generally, this involves reviewing business operations, identifying potential threats to the company and the likelihood of their occurrence and then taking appropriate actions to address the most likely threats. The Company adopts a systematic approach to mitigate risks associated with accomplishment of objectives, operations, revenues and regulations. The risk management framework of the Company comprises of the following key elements viz., a) Risk Assessment: study of threats and vulnerability and exposure to various risks; b) Risk Management and Monitoring: probability of risk assumption is estimated and monitored; and c) Risk Mitigation: measures adopted to mitigate risks by the Company.

The Risk Management Committee assists the Board in monitoring various risks, reviews and analyses risk exposures and mitigation plans related to the Company and its group companies. A Risk Management Policy has been approved by the Board of Directors which inter alia sets out risk strategy, approach and mitigation plans, liquidity risk management and asset liability management. During the year the Risk Management Committee of CFHL reviewed key risk exposures of the Company along with mitigation measures, asset liability management, structural liquidity management besides review of key risk exposures and mitigation measures of group companies.

Key risk exposures of the Company along with risk mitigation measures are provided in the table below. The risks furnished below are not exhaustive and assessment of risk is based on management perception.

Further, risks arising out of NBFC and insurance business constitute the dominant risks of the Company on a consolidated basis. The group companies have their own risk management framework in line with its strategic business operations as appropriate to the industry in which they operate. The risk management framework of NBFC and insurance business are broadly based on: clear understanding and identification of various risks, disciplined risk assessment by evaluating the probability and impact of each risk, measurement and monitoring of risks by establishing key risk indicators with thresholds for all critical risks and adequate review mechanism to monitor and control risks. The business operations of each of the group companies, the risks faced by them, and the risk mitigation tools followed by them are reviewed periodically by the Risk Management Committees and the Boards of the respective companies.

CIFCL has robust management information reporting (MIS) to provide the board and senior management in a clear and concise manner with timely and relevant information concerning the risk profile. MIS includes all risk exposures including those that are off-balance sheet. Senior management is informed of the assumptions behind and limitations inherent in specific risk measures. Risk appetite is an articulation of the quantum of risk the company is willing to accept, in pursuit of its strategy approved by the Board. The company has defined its risk appetite and tolerance limits within its risk management policy framework for specific organizational objectives. CMSGICL has put in place an appropriate risk management system covering various risks the company is exposed to. The risk management framework of CMSGICL broadly comprise of establishment of risk management policy, formulation of risk register, review of key risk exposures and asset liability management. Risk management activities of CMSGICL are aligned to its corporate objectives, organisational priorities and designed to protect and enhance its reputation.

CORPORATE GOVERNANCE

The Company firmly believes in committing itself to maintaining high standards of corporate governance. A report on corporate governance of the Company together with a certificate from practicing company secretaries in accordance with the SEBI Listing Regulations is annexed to this Report as Annexure II. The Report further contains other details which are required to be provided in the Board's Report.

BOARD MEETINGS

Five meetings of the Board were held during the year ended March 31, 2024. Further details on the Board meetings are disclosed in the Report on Corporate Governance.

COMPOSITION OF THE AUDIT COMMITTEE

The Board has constituted an Audit Committee in terms of the applicable provisions of the Act, the SEBI Listing Regulations and the Master Directions of RBI. Details of terms of reference, composition and meetings of the committee are disclosed in the Report on Corporate Governance.

BOARD EVALUATION

Pursuant to the provisions of section 134 of the Act and regulation 17 of the SEBI Listing Regulations, the Board of Directors have carried out an annual performance evaluation of the Board itself, the individual directors, various committees of the Board and the Chairman for FY 24. The manner in which the evaluation has been carried out is provided in the Report on Corporate Governance.

POLICY ON BOARD NOMINATION AND REMUNERATION

The Board has formulated a policy for selection and appointment of directors, senior management and their remuneration. Details of which are furnished in the Report on Corporate Governance.

CORPORATE SOCIAL RESPONSIBILITY (‘CSR')

With the enactment of Corporate Social Responsibility (CSR) provisions in the Companies Act, 2013, the Company has framed a CSR Policy and the policy is available on the Company's website at http://www.cholafhl.com/article/profile/967. Pursuant to the provisions of section 135(5) of the Act, every company shall spend at least two percentage of its average net profits made during the three immediately preceding financial year in pursuance of its CSR Policy. The Company does not have CSR obligations for FY 24. Therefore, the annual report on CSR activities as required under the Act is not attached to this Report.

RELATED PARTY TRANSACTIONS

The Company has formulated a policy on related party transactions. All transactions that were entered into by the Company with related parties during the financial year were in the ordinary course of business and on an arm's length basis. There were no materially significant related party transactions during the year which had potential conflict with the interests of the Company at large. Pursuant to section 134(3)(h) of the Act read with rule 8(2) of the Companies (Accounts) Rules, 2014, there were no transactions during the year to be reported under section 188(1) of the Act in Form AOC-2.

Necessary disclosures on related party transactions have been made in the notes to the financial statements. None of the Directors had any pecuniary relationships or transactions vis-a-vis the Company.

HUMAN RESOURCES (‘HR') AND PARTICULARS OF EMPLOYEES

Human Resources (‘HR') are the valuable assets for the group. CFHL along with its group companies has a work force of more than 39,700 employees as of March 31, 2024. The group companies have robust HR management practices enabling achievement of organizational goals and key milestones through people. The safety and well-being of the employees continues to be focus area. The group continues to emphasize on resourcing and talent planning strategies based on their functional and general management requirements in preparing the organisation for the future.

As on March 31, 2024, there were two employees on the rolls of CFHL. The information required to be disclosed under the provisions of section 197 of the Act read with rule 5 of the Companies (Appointment & Remuneration of Managerial Personnel) Rules, 2014 is appended as Annexure III to this Report.

EMPLOYEE STOCK OPTION (‘ESOP') SCHEMES

The Company's ESOP Schemes viz., Employee Stock Option Plan 2007 (‘ESOP 2007') and Employee Stock Option Plan 2016 (‘ESOP 2016') have been approved by the shareholders. There are no options outstanding under either of the schemes as on March 31, 2024. Further, there have been no fresh grants under either of the schemes during the year. Details in respect of ESOP 2007 and ESOP 2016 as required under the applicable SEBI regulations are displayed on the Company's website at http://www.cholafhl.com/article/investors/554. Both the schemes are in compliance with the SEBI (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 and SEBI (Share Based Employee Benefits) Regulations, 2014 respectively. The certificate from the secretarial auditor, M/s. Srinidhi Sridharan & Associates, Practicing Company Secretaries confirming that ESOP 2007 and ESOP 2016 schemes have been implemented in accordance with the applicable regulations and shareholders' resolutions passed in the general meeting of the Company, will be available for the shareholders at the ensuing AGM.

ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The Company has no activity relating to consumption of energy or technology absorption etc. and does not have any foreign exchange earnings. There was a foreign exchange outgo during the year by way of repatriation of dividend amounting to Rs.0.31 Lakh (previous year: Rs.0.31 Lakh).

WHISTLE-BLOWER/VIGIL MECHANISM

In compliance with the provisions of section 177(9) of the Act read with the Companies (Meetings of Board and its Powers) Rules, 2014, regulation 22 of the SEBI Listing Regulations and the Scale Based Regulations of RBI, the Companyhasestablishedawhistleblower/vigilmechanism for directors and employees to report genuine concerns. The mechanism provides for adequate safeguards against victimisation of persons using the mechanism and makes provision for direct access to the Chairman of the Audit Committee in appropriate or exceptional cases. The policy is available on the Company's website at http://www.cholafhl.com/article/investors/34.

PREVENTION OF SEXUAL HARASSMENT AT WORKPLACE

Pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013, the Company has formulated a policy for prevention of sexual harassment at workplace. An internal complaints committee (‘ICC') is in place to redress complaints received regarding sexual harassment. The policy extends to all employees (permanent, contractual, temporary and trainees). During the calendar year 2023 no referrals were received under the policy and no complaints were pending at the beginning and end of the year.

SECRETARIAL AUDIT

Pursuanttotheprovisionsofsection204oftheCompanies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and regulation 24A of the SEBI Listing Regulations, the Board appointed M/s. Srinidhi Sridharan & Associates, Practicing Company Secretaries, to conduct the secretarial audit for the year ended March 31, 2024. The Report issued by the secretarial auditor in the prescribed form MR-3 is annexed to this Report as Annexure IV. The

secretarial audit report does not contain any qualification, reservation or adverse remark by the secretarial auditor. In compliance with regulation 24A of the SEBI Listing Regulations, the secretarial audit report of the Company's material subsidiary, Cholamandalam MS General Insurance Company Limited, for the year ended March 31, 2024 is annexed to this Report as Annexure V.

COST RECORD AND COST AUDIT

Maintenance of cost records and requirements of cost audit as prescribed under the provisions of section 148(1) of the Act is not applicable to the Company.

ANNUAL RETURN

Pursuant to the provisions of section 92(3) and section 134(3)(a) of the Companies Act, 2013, the annual return for the year ended March 31, 2024 is available on the Company's website at http://www.cholafhl.com/article/subsidyfinancials/400.

COMPLIANCE WITH SECRETARIAL STANDARDS

The Company has complied with the Secretarial Standards on Meetings of the Board of Directors (SS-1) and Secretarial Standards on General Meetings (SS-2) issued by the Institute of Company Secretaries of India.

MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY

There are no material changes and commitments affecting the financial position of the Company which have occurred between March 31, 2024, and the date of this Report.

BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT

In terms of regulation 34(2)(f) of the SEBI Listing Regulations, annual report of top one thousand listed entities based on market capitalization, shall contain the Business Responsibility and Sustainability Report (‘BRSR') describing the initiatives taken by the entity from an environmental, social and governance perspective. Accordingly, the Company has prepared BRSR, which indicates the Company's performance against the principles of the National Guidelines on Responsible Business Conduct. A copy of the BRSR is annexed to this Report as Annexure VI.

DIRECTORS' RESPONSIBILITY STATEMENT

The Board of Directors confirm that the Company has in place a framework of internal financial control and compliance system, which is reviewed by the Audit Committee and the Board and independently reviewed by the internal auditors, statutory auditors and secretarial auditors. Further, pursuant to section 134(5) of the Companies Act, 2013, the Board of Directors confirm that:

a) in the preparation of the annual financial statements for the year ended March 31, 2024, the applicable accounting standards have been followed and that there were no material departures therefrom;

b) they have, in the selection of the accounting policies, consulted the statutory auditors and have applied their recommendations 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 as at March 31, 2024 and of the profit of the Company for the year ended on that date;

c) they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d) they have prepared the annual financial statements on a going concern basis;

e) they have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively during the year ended March 31, 2024; and f) proper system has been devised to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively during the year ended March 31, 2024.

DECLARATIONS/AFFIRMATIONS

• There were no significant material orders passed by the regulators or courts or tribunals impacting the Company's going concern status and its operations in future.

• The Company does not carry on any activities other than those specifically permitted by the RBI for CICs.

RBI does not accept any responsibility or guarantee about the present position as to the financial soundness of the Company or the correctness of any of the statements or representations made or opinions expressed by the Company and for discharge of any liability by the Company.

Neither there is any provision in law to keep, nor does the Company keep any part of the deposits with RBI and by issuing a Certificate of Registration to the Company, RBI neither accepts any responsibility nor guarantees the payment of deposits to any depositor or any person who has lent any sum to the Company.

• There are no applications made or any proceedings pending under the Insolvency and Bankruptcy Code, 2016 during the year.

• During the year, the Company had not made any one-time settlement with banks or financial institutions.

ACKNOWLEDGMENT

The Directors express their gratitude for the support and co-operation extended by the Ministry of Corporate Affairs, Securities and Exchange Board of India, Reserve Bank of India, Stock Exchanges and other statutory authorities. The Directors also wish to thank all investors, vendors, financial institutions, banks and joint venture partners for their continued support and faith reposed in the Company. The Board places on record its appreciation for the contribution made by the employees of the Company and its group companies across all levels.