S P Capital Financing Ltd

Dear Members,

Your Directors are pleased to present their 41^st Annual Report on the Business and operations of the Company together with the Audited Accounts of your Company (‘S P Capital Financing Limited') for the year ended March 31, 2024.

1. FINANCIAL RESULTS

The financial performance of your Company for the year ended March 31, 2024 is summarized below:

(INR in Lakhs)

2. OVERVIEW OF COMPANY'S FINANCIAL PERFORMANCE

On standalone basis, your company earned the gross income of INR 255.10 Lakhs as against INR 157.02 Lakhs in previous year. The total expenditure during the year under review was INR 181.34 Lakhs as against Rs.75.64 Lakhs in the previous year. The Total Comprehensive Income was INR 229.52 Lakhs as against INR 55.22 Lakhs in the previous year.

On consolidated basis, your Company has earned the gross income of INR 255.10 Lakhs as against INR 157.07 Lakhs in the previous year. The total expenditure during the year under review was Rs.181.34 Lakhs as against INR 93.54 Lakhs in the previous year. The Total Comprehensive Income was INR 229.72 Lakhs as against INR 0.15 Lakhs in the previous year. .

3. PERFORMANCE AND FINANCIAL POSITION OF THE ASSOCIATE COMPANY

Pursuant to Section 134 of the Companies Act, 2013 and Rule 8(1) of the Companies (Accounts) Rules, 2014, the report on performance and financial position of associate company is included in the Consolidated Financial Statements (CFS) in the Company. A statement containing the salient features of financial statements of associate company of the Company in the prescribed Form AOC 1 forms a part of Consolidated Financial Statements (CFS) in compliance with Section 129 (3) and other applicable provisions, if any, of the Act read with Rule 5 of the Companies (Accounts) Rules, 2014 and forming part of this Annual Report as Annexure 4. In accordance with Section 136 of the Act, the financial statements of associate company is available for inspection by the members at the Registered Office of the Company during business hours on all days except Saturdays, Sundays and public holidays up to the date of the AGM. Any member desirous of obtaining a copy of the said financial statements may write to the Company Secretary at the Registered Office of the Company. The financial statements including the CFS, and all other documents required to be attached to this report have been uploaded on the website of the Company at www.spcapital.in.

Brief Financial and Operation of Associate Company are given here under:

Pride Orchades Private Limited: It earned gross income of Rs.1,64,782/- as against Rs. 1,50,580/- in the previous year. The total expenditure during the year under review was Rs.1,27,248/- as against expenditure of Rs.69,859/- in the previous year.

4. CONSOLIDATED FINANCIAL STATEMENTS

In accordance with the provisions of Companies Act, 2013 (hereinafter referred to as "the Act"),

Regulation 33 of the Securities and Exchange Board of India (Listing Obligations and Disclosure

Requirements) Regulations, 2015 (hereinafter referred to as "Listing Regulations") and applicable

Accounting Standards, the Audited Consolidated Financial Statements of the Company for the financial year 2023-24, together with the Auditors' Report form part of this Annual Report

5. DIVIDEND

The Board of Directors had declared the Interim Dividend at the rate of 10% per Equity Shares (Rs. 1/- per Equity Share), the face value of Equity Shares is Rs. 10/- per equity share.

6. TRANSFER TO RESERVES

During the year your Company has not transferred any amount to general reserve.

7. RBI GUIDELINES

Your Company has complied with all the applicable regulations prescribed by the Reserve Bank of India from time to time.

8. INDIAN ACCOUNTING STANDARD (IND AS)

The Company has adopted Indian Accounting Standards ("IND AS") from April 01, 2019 with a transition date of April 01, 2018. Accordingly, the financial statement for the year 2023-24 have been prepared in accordance with IND-AS, prescribed under Section 133 of the Act, read with the relevant rules issued there under and the other recognised accounting practices and policies to the extent applicable.

9. LISTING WITH STOCK EXCHANGES

The Equity Shares of the Company continued to be listed and traded on the BSE. The scrip code number of the Equity Shares of the Company on BSE is 530289.

The Company has paid up to date listing fees to the stock exchange.

As per the provisions of section 92(3) read with section 134(3)(a) of the Act, the Annual Return of the Company for the Financial Year ended on March 31, 2024, is hosted on the website of the Company at www.spcapital.in/investorrelations.html

The particulars of loans, guarantees and investment have been disclosed in the notes to the financial statements.

Your Board of Directors duly met Ten (10) times during the financial year i.e. May 18, 2023, July 18, 2023, August 10, 2023, September 01, 2023, October 09, 2023, November 07, 2023, November 09, 2023, December 11, 2023, February 13, 2024 and March 01, 2024 in respect of which proper notices were given and the proceedings were properly recorded and signed in the Minute Book maintained for the purpose. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013.

Pursuant to the provisions of Sub-Section (7) of Section 149 of the Companies Act 2013, the Company has received individual declarations from all the Independent Directors confirming that they fulfil the criteria of independence as specified in Section 149(6) of the Companies Act 2013. As per Section 149 of the Companies Act, 2013, independent directors shall hold office for a term up to five consecutive years on the board of a company, but shall be eligible for re-appointment for another term up to five years on passing of a special resolution by the company and disclosure of such appointment in Board's Report. Further Section 152 of the Act provides that the independent directors shall not be liable to retire by rotation in the Annual General Meeting ('AGM') of the Company.

No material changes and commitments which could affect the Company financial position have occurred between the end of the financial year of the Company and the date of this report, except as disclosed elsewhere in this report.

Pursuant to Regulation 34 read with Schedule V to Listing Regulations, Management Discussion and

Analysis Report, capturing your Company's performance, industry trends and other material changes with respect to your Company's and its associates, wherever applicable, for the year under review is presented in a separate section forming part of this Annual Report as Annexure 5

During the year under review the Company's Net-worth has been exceeded the threshold limit, that is Rs. 25 Crore. Hence, pursuant to the provisions of SEBI (LODR) Regulations, 2015, the Corporate Governance provisions have become applicable to the Company, and accordingly your company is complying with the same. The Report on Corporate Governance is been attached with this report as

Annexure 6.

The present strength of Board of Directors consists of two (Promoter) Directors and two Non-Executive (independent) Directors who are themselves experienced industrialists heading their business empire and category are given below:

The Composition of the Board of Directors and also the number of other Directorship of Committees of which they are member/Chairperson are as given below:

During the year under review, Ten Board meetings were held which were attended by each the Director as detailed herewith.

During the year, there is no change in the Directors of the Company.

However following were the changes in the post of Company Secretary & Compliance officer

1. Resignation of Ms. Sonal Naik, Company Secretary & Compliance Officer resigned w.e.f July 12, 2023

2. Appointment of Mr. Pratik Tirlotkar as Company Secretary & Compliance Officer w.e.f July 18, 2023

3. Resignation of Mr. Pratik Tirlotkar, Company Secretary & Compliance Officer w.e.f. December 14, 2023.

4. Appointment of Ms. Sonali Sudhir Bapardekar as the Company Secretary & Compliance Officer w.e.f. March 01, 2024.

(ii) Retirement by rotation:

Mr. Sureshchand Premchand Jain (DIN 00004402), who retires by rotation and, being eligible, offers himself for re-appointment. If re-appointed, his term would be in accordance with the policy for directors of the Company.

The following policies of the company are attached herewith

Policy on appointment of Directors and Senior Management (Annexure 1) Policy on Remuneration to Director's (Annexure 2)

Policy on Remuneration of Key Managerial Personnel and Employees (Annexure 3)

In terms of the provisions of Section 149 of the Companies Act, 2013, and Regulation 17 (1) (a) of the SEBI (LODR) Regulations, 2015, the Company shall have at least one Woman Director on the Board. Your Company has Mrs. Meena Sureshchand Jain, as Woman Director on the Board of the Company.

In accordance to the provisions of Companies Act, 2013, the following persons are the KMPs of the Company, as recorded by the Board as on March 31, 2024:

At the Annual General Meeting held on September 30, 2021, JMT & Associates, Chartered Accountants (FRN:104167W), were appointed as statutory auditors of the Company to hold office till the conclusion of the Annual General Meeting to be held in the calendar year 2025.

The observations made by the Statutory Auditors in their Report for the Financial Year Ended March 31, 2024, read with the explanatory notes therein are self-explanatory and therefore, do not call for any further explanation or comments from the Board under section 134(3) of the Companies Act, 2013. Further, pursuant to Section 143(12) of the Act, the Statutory Auditors of the Company have not reported any instances of frauds committed in the Company by its officers or employees.

A Secretarial Audit Report for the year ended March 31, 2024 in prescribed form duly audited by the Practicing Company Secretary Firm M/s. Shobha Ambure & Associates is annexed as Annexure 9 herewith and forming part of the report.

Explanation by the Board on qualifications made by Secretarial Auditor is as follows:

1. The Outcome of the Board Meeting dated 13/02/2024, Pursuant to Regulation 30 of SEBI (LODR) Regulations, 2015, was uploaded within the stipulated time (i.e. 30 minutes) but the accompanying documents were uploaded after 11 minutes of the stipulated time.

Management's Reply

The supporting documents were inadvertently missed due to hardware technical issues and the same was uploaded 11 minutes after the stipulated time.

2. The Shareholding pattern for the quarter ended December 31, 2023, Pursuant to Regulation 31 of SEBI (LODR) Regulations, 2015 was uploaded 3 days after the stipulated time (i.e. 21 days after the end of the quarter). The Company has paid a fine to the Securities Exchange Board of India on March 04, 2024.

Management Reply

The delay was due to technical error. Further the Company has paid fine to the Stock Exchange for the same.

3. Whereas as per Section 117 and 179 of the Companies Act, 2013 and other applicable rules and provisions of the Act, if any, Form MGT-14 shall be filed with the Registrar within 30 days of passing the resolution. The Company has not filed the same for Approval of financial statements at the Board meeting dated 18/05/2023 and Issue of preference shares on private placement basis at the Board meeting dated 01/09/2023.

Management's Reply

The Company had filed form MGT-14 under Section 55 of Allotment of Preference shares resolution passed by the Board of Directors in their Board Meeting dated 01/09/2023. However same was not filed for Section 179 of Companies Act, 2013.

Annual Secretarial Compliance Report is applicable to your Company for the FY 2023-24. The same has been filed with the BSE Limited within the prescribed timelimit.

Maintenance of cost records and requirement of cost audit as prescribed under the provisions of Section 148(1) of the Act are not applicable for the business activities carried out by the Company.

20. VIGIL MECHANISM:

The Company has established a vigil mechanism for directors and employees to report to the appropriate authorities concerns about unethical behaviour, actual or suspected, fraud or violation of the Company's code of Conduct. During the financial year 2023-24, no cases under this mechanism were reported to the Company and associate Company. During the year no personnel has been denied access to the Audit Committee.

21. INTERNAL CONTROL

The Board ensures the effectiveness of the Company's system of internal controls incl uding financial, operational and compliance control and same is subject to review periodically by the Board of Directors and M/s. M.M. Dubey and Co, Chartered accountants, Internal Auditors of the Company for its effectiveness. The control measures adopted by the company have been found to be effective and adequate to the Company's requirement.

In terms of Section 134(5) of the Companies Act, 2013, the Board of Directors of the Company hereby confirms that:

i. In the preparation of the annual accounts for the financial year ended March 31, 2024 the applicable accounting standards have been followed along with proper explanation relating to material departures. 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 and of the profit and loss of the Company for the year ended March 31, 2024.

iii. The Directors have taken sufficient and proper 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 material fraud and other irregularities.

iv. The Directors have prepared the Annual Accounts on a going concern basis.

v. There are proper systems have been devised to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

vi. That the Directors had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively.

The Board of Directors has constituted three committees of the Board (i) Audit committee (ii) Nomination

& Remuneration Committee and (iii) Stakeholder's Relationship Committee.

Audit Committee comprised of following members and attendance of Audit Committee members as follows:

The Committee met on May 18, 2023, August 10, 2023, November 07, 2023 and February 13, 2024.

Nomination and Remuneration Committee comprised of following members and attendance of NRC members as follows:

The Committee met on July 18, 2023 and March 01, 2024

Stakeholder Relationship Committee comprised of following members and attendance of Stakeholers Relationship Committee members as follows:

The prescribed particulars of the employees required under Rule 5 (1) of the Companies (Appointment and Remuneration) Rules, 2014, are attached as Annexure 8 and forms part of this report. None of the employees of the Company is in receipt of remuneration prescribed under Section 197 (12) of the Companies Act, 2013, read with rule 5(2) of the Companies (Appointment and Remuneration) Rules, 2014. Thus furnishing of particulars under the Companies (Appointment and Remuneration) Rules, 2014 does not arise.

No material changes and commitments affecting the financial position of your Company occurred between the end of the financial year to which Financial Statements relate and the date of this report.

The Company has developed and implemented a risk management policy which identifies major risks which may threaten the existence of the Company. The same has also been adopted by your Board and is also subject to its review from time to time. Risk mitigation process and measures have been also formulated and clearly spelled out in the said policy.

Section 135(1) of the Companies Act, 2013 is not applicable to your Company. Hence, report of the same is not forming part of this report.

During the year under review, Company has not entered into Related Party which requires disclosure under Section 134 (3) (h) of the Companies Act, 2013 and Rule 8(2) of the Companies (Accounts) Rules, 2014.

The requirements of disclosure with regard to Conservation of Energy in terms of Section 134 of the Companies Act, 2013, read with the Companies (Accounts) Rules, 2014, are not applicable to the

Company since it doesn't own any manufacturing facility.

Further the Company has not earned nor spends foreign exchange during the year.

The Board carried out formal annual evaluation of its own performance and that of its Committees viz., the Audit Committee, Stakeholders' Relationship Committee, Nomination and Remuneration Committee (NRC). The Board also carried out the performance evaluation of all the individual directors including the Chairman of the Company. Additionally, NRC also carried out the evaluation of the performance of all the individual directors and Chairman of the Company.

There were no such event during the year under review.

Since your Company is a non-deposit taking Non-Banking Financial Company, it has not accepted any deposits under Chapter V of Companies Act, 2013 applicable guidelines of Reserve Bank of India, during the year under review

There were no significant and material orders passed by the regulators or courts or tribunals, which may impact the going concern status of the Company and its operations in future.

Company has adequate system of internal financial controls in place to ensure the reliability of their financial statements, prevent fraud and mismanagement, and ensure compliance with applicable laws and regulations.

As the Company not fall in the list as specified by the Central Government under sub-section (1) of section 148 of the Companies Act, 2013, hence Company is not maintaining accounts and records

The Company has zero tolerance towards sexual harassment of women at the workplace. The Company has in place a Policy on Prevention, Prohibition and Redressal of Sexual Harassment of Women at Workplace in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and rules made thereunder for reporting and conducting inquiry into the complaints made by the victim on the harassments at the work place.

During the FY 2023-24, the Company has not received any complaint of sexual harassment and hence there were no complaints pending for redressal as on 31^st March, 2024.

There were no such event during the year under review.

There were no such event during the year under review.

1. The Company has complied with Secretarial Standards issued by the Institute of Company Secretaries of India on Board Meetings, Annual General Meetings and Dividend.

2. The details of difference between amount of the valuation done at the time of one time settlement and the valuation done while taking loan from the Banks or Financial Institutions along with the reasons thereof- Not Applicable.

3. There has been no material change in the nature of business of the Company during the year under review.

4. During the year under review, there were no instances of any frauds reported by the Statutory Auditors under section 143(12) of the Act.

Yours Directors take this opportunity to thank the Financial Institutions, Banks, Business Associates, Central and State Government authorities, Regulatory authorities, Stock Exchanges and all the various stakeholders for their continued co-operation and support to the Company and look forward to their continued support in future. We very warmly thank all of our employees for their contribution to your Company's performance. We applaud them for their superior levels of competence, dedication and commitment to your Company.

The Nomination and Remuneration Committee (NRC) of the Board of Directors (Board) of the Company reviews and assesses Board composition and recommends the appointment of new Directors. In evaluating the suitability of individual Board member, the NRC shall take into account the following criteria regarding qualifications, positive attributes and also independence of director when Independent Director is to be appointed:

1. All Board appointments will be based on merit, in the context of the skills, experience, diversity, and knowledge, for the Board as a whole to be effective;

2. Ability of the candidates to devote sufficient time and attention to his / her professional obligations as Director for informed and balanced decision making;

3. Adherence to the applicable Code of Conduct and highest level of Corporate Governance in letter and in sprit by the Directors; Based on the recommendations of the NRC the board will evaluate the candidates and decide on the selection the appropriate member. The Board through the Chairman or the Managing Director & CEO will interact with the new member to obtain his/her consent for joining the Board. Upon receipt of the consent, the new Director will be co-opted by the Board in accordance with the applicable provisions of the Companies Act, 2013 and Rules made there under.

If a Director is attracted with any disqualification as mentioned in any of the applicable Act, rules and regulations there under or due to non - adherence to the applicable policies of the Company, the NRC may recommend to the Board with reasons recorded in writing, removal of a Director subject to the compliance of the applicable statutory provisions.

The NRC shall identify persons based on merit, experience and knowledge who may be appointed in senior management team.

Senior Management personnel are appointed or promoted and removed/relieved with the authority of Managing Director & CEO based on the business need and the suitability of the candidate. The details of the appointment made and the personnel removed one level below the Key Managerial Personnel during a quarter shall be presented to the Board.

This Policy sets out the approach to Compensation/remuneration/commission etc. will be determined by Committee and Recommended to the Board of Directors, for approval. Also remuneration to be paid to the Managing Director, other executive directors in accordance with provisions of Companies Act, 2013, and other statutory provisions if any, would require to complying for time being of appointment of such person.

The Company has a well-defined Compensation policy for Directors, including the Chairman of the Company. The overall compensation philosophy which guides us to focus on enhancing the value, to attract, to retain and motivate Directors for achieving objectives of Company and to become a major player in market, to be the most trusted brand in the business .we operate in and focus on customer serenity through transparency, quality and on time delivery to be a thought leader and establish industry benchmarks in sustainable development.

In order to effectively implement this, the Company has built a Compensation structure by a regular annual benchmarking over the years with relevant players across the industry the Company operates in.

The Nomination and Remuneration Committee (NRC) shall decide the basis for determining the compensation, both fixed and variable, to the Non-Executive Directors, including Independent Directors, whether as commission or otherwise. The NRC shall take into consideration various factors such as director's participation in Board and Committee meetings during the year, other responsibilities undertaken, such as membership or Chairmanship of committees, time spent in carrying out their duties, role and functions as envisaged in Schedule IV to the Companies Act, 2013 and Clause 49 of the Listing Agreement with Stock Exchanges and such other factors as the NRC may consider deem fit for determining the compensation. The Board shall determine the compensation to Non-Executive Directors within the overall limits specified in the Shareholders resolutions.

Remuneration of the MD / CEO and Executive Directors reflects the overall remuneration philosophy and guiding principle of the Company. While considering the appointment and remuneration of Managing Director and Executive Directors, the NRC shall consider the industry benchmarks, merit and seniority of the person and shall ensure that the remuneration proposed to be paid is commensurate with the remuneration packages paid to similar senior level counterpart(s) in other companies. The policy aims at a balance between fixed and variable pay reflecting short and long-term performance objectives appropriate to the working of the company and its goals.

The remuneration to the MD / CEO shall be recommended by NRC to the Board. The remuneration consists of both fixed compensation and variable compensation and shall be paid as salary, commission, performance bonus, stock options (where applicable), perquisites and fringe benefits as per the policy of the Company from time to time and as approved by the Board and within the overall limits specified in the Shareholders resolution. While the fixed compensation is determined at the time of appointment, the variable compensation will be determined annually by the NRC based on the performance of MD / CEO. The term of office and remuneration of MD / CEO is subject to the approval of the Board of Directors, shareholders, and Central Government, as may be required and within the statutory limits laid down in this regard from time to time. If, in any financial year, the Company has no profits or its profits are inadequate, the Company shall pay, subject to the requisite approvals, remuneration to its MD / CEO in accordance with the provisions of Schedule V to the Companies Act,

2013. If a MD & CEO draws or receives, directly or indirectly by way of remuneration any such sums in excess of the limits prescribed under the Companies Act, 2013 or without the prior sanction of the Central Government, where required, he / she shall refund such sums to the Company and until such sum is refunded, hold it in trust for the Company.

The Company shall not waive recover y of such sum refundable to it unless permitted by the Central Government of the Company. Remuneration for MD / CEO is designed subject to the limits laid down under the Companies Act, 2013 to remunerate him / her fairly and responsibly. The remuneration to the MD / CEO comprises of salary, perquisites and benefits as per policy of the Company and performance based incentive apart from retirement benefits like P.F., Superannuation, Gratuity, Leave Encashment, etc. as per Rules Salary is paid within the range approved by the Shareholders. Increments are effective annually, as recommended /approved by the NRC / Board. The MD / CEO is entitled for grant of Stock Options as per the approved Stock Options Schemes of the Company from time to time.

The MD / CEO is an executive of the Company and draws remuneration from the Company. The Non-Executive Independent Directors receive sitting fees for attending the meeting of the Board and Committee thereof, as fixed by the Board of Directors from time to time subject to statutory provisions. The Non-Executive Independent Directors would be entitled to the remuneration under the Companies Act, 2013. In addition to the above, the Directors are entitled for reimbursement of expenses incurred in discharge of their duties.

The Company may also grant Stock Options to the eligible employees and Directors (other than Independent Directors) in accordance with the ESOP Schemes of the Company from time to time and subject to the compliance statutes and regulations.

Information on the total remuneration of members of the Company's Board of Directors, Managing

Director and Executive Directors and KMP/senior management personnel may be disclosed in the

Board's report and the Company's annual report / website as per statutory requirements in this regard.

To establish guidelines of remuneration/ compensation/ commission etc. to be paid for employees by way of fairly and in keeping with Statutes, it will be determined by the Nomination & Remuneration committee (NRC) and the NRC will recommend to the Board for approval.

1. All employees, irrespective of contract, are to be paid remuneration fairly and the remuneration is to be externally competitive and internally equitable. The remuneration will be paid in accordance with the laid down Statutes.

2. Remuneration for on-roll employees will include a fixed or guaranteed component payable monthly; and a variable component which is based on performance and paid annually.

3. The fixed component of remuneration will have a flexible component with a bouquet of allowances to enable an employee to choose the allowances as well as the quantum based on laid down limits as per Company policy. The flexible component can be varied only once annually in the month of July, after the salary increment exercise.

4. The variable component of the remuneration will be a function of the employee's grade.

5. The actual pay-out of variable component of the remuneration will be function of individual performance as well as business performance. Business performance is evaluated using a Balance Score Card (BSC) while individual performance is evaluated on Key Result Areas (KRA). Both the BSC & KRAs are evaluated at the end of the fiscal to arrive at the BSC rating of the business and PPS rating of the individual.

6. An Annual compensation survey is carried out to ensure that the Company's compensation is externally competitive. Based on the findings of the survey and the business performance, the committee decides: (i) The increment that needs to be paid for different performance ratings as well as grades. (ii) The increment for promotions and the total maximum increment. (iii) The maximum increase in compensation cost in % and absolute. (iv) Compensation corrections are made in a few cases where it is outside the band or to keep it tune with the market.