kiran vyapar ltd Directors report

TO THE MEMBERS,

Your Directors have pleasure in presenting their 27th Annual Report on the business and operations of the Company and the Audited Financial Statements for the Financial Year ended 31st March, 2023.

1. Financial Performance of the Company

	Standalone		Consolidated
Particulars	2022-2023	2021-2022	2022-2023	2021-2022
Total Income	4455.54	12775.97	6787.44	16539.78
Total Expenses	1820.90	1716.09	3558.44	4743.19
Profit before share of profit in Associates	-	-	3229.00	11796.59
Share of Profit of Associates(net)	-	-	1393.67	2095.30
Profit Before Exceptional Items & tax	2634.64	11059.88	4622.67	13891.89
Exceptional Items	-	-	-	9.53
Profit Before Tax	2634.64	11059.88	4622.67	13901.42
Tax Expenses	286.00	2261.41	769.39	2088.63
Profit for the year	2348.64	8798.47	3853.28	11812.79
Other Comprehensive Income	1710.22	2364.91	(127.76)	10392.75
Total Comprehensive Income	4058.86	11163.38	3725.52	22205.54
Appropriations:
Profit for the year	2348.64	8798.47	3853.28	11812.79
Balance brought forward	61829.27	54307.84	80272.65	70481.96
Amount Available for Appropriations	64177.91	63106.31	84125.93	82294.75
Dividend Paid	(409.26)	(409.26)	(404.72)	(404.72)
Transfer to Statutory Reserve	(469.73)	(1759.69)	(490.90)	(1751.22)
Impairment Reserve	(6.04)	16.67	(18.55)	16.67
Minority Interest	-	-	29.46	19.74
Re-measurement of defined benefit plans (net)	-	-	-	-
Transfer to Retained Earning	258.39	875.24	-	-
Adjustment for De-recognition of Assets	-	-	-	(377.76)
Adjustment for De-recognition of Subsidiary	-	-	-	475.18
Balance carried forward	63551.28	61829.27	83241.22	80272.65

a) Consolidated operations

Revenue from the consolidated operations of the Company for the year ended 31st March, 2023, was Rs. 6728.49 Lacs. It is 57.52 per cent lower than the previous years revenue of Rs.15842.25 Lacs. Overall operational expenses for the year was Rs.3558.44 Lacs. It is 24.97 per cent lower than of previous years expenses of Rs. 4743.19 Lacs. Profit for the year 2022-23 was Rs. 3853.28 Lacs. It is 67.38 per cent higher than of previous years profit of Rs. 11812.79 Lacs.

b) Standalone operations

Revenue from the standalone operations of the Company for the year was Rs.4455.54 Lacs. It is 65.12 percent lower than the previous years revenue of Rs. 12774.74 Lacs. Overall operational expenses for the year was Rs.1820.90 Lacs. It is 6.10 per cent higher than of previous years expenses of Rs.1716.09. Profit after tax for the year 2022-23 stood at Rs. 2348.64 Lacs. It is 73.31 per cent lower than of previous years profit of Rs.8798.47 Lacs.

The Capital to Risk Assets Ratio (CRAR) of your Company stood at 74.36 per cent as on March 31, 2023, well above the regulatory minimum level of 15 per cent prescribed by the Reserve Bank of India for Systemically Important Non-Deposit Taking NBFCs (NBFCs- ND-SI). Of this, the Tier I CRAR was 74.19 per cent and Tier II CRAR was 0.17 per cent c) Basis of preparations of financial statements

These standalone financial statements have been prepared in accordance with Indian Accounting Standards notified under section 133 of the Companies Act 2013, read together with the Companies (Indian Accounting Standards) Rules, 2015 as amended from time to time (‘Ind AS) along with other relevant provisions of the Act; the Master Direction Non-Banking Financial Company Systemically Important Non-Deposit taking Company and Deposit taking Company (Reserve Bank) Directions, 2016 (‘the NBFC Master Directions) issued by RBI (as amended) and the regulatory guidance on implementation of Ind AS as notified by the RBI vide notification dated 13 March 2020.

The Guidance Note on Division III - Schedule III to the Companies Act. 2013 issued by the Institute of Chartered Accountants of India (“”ICAI””) has been followed insofar as they are not inconsistent with any of these Directions”

These standalone financial statements have been prepared and presented under the historical cost convention, on the accrual basis of accounting except for certain financial assets and financial liabilities that are measured at fair values at the end of each reporting period, as stated in the accounting policies set out below. The accounting policies have been applied consistently over all the periods presented in these standalone financial statements.

2. BRIEF DESCRIPTION OF THE COMPANYS AFFAIRS

Your Company is a Non-Banking Financial Company - Systemically Important Non-Deposit taking Company registered with the Reserve Bank of India. The Business model of the Company comprises of Lending and Acquisition / Investments in Shares and Securities including Mutual Funds, Venture Capital Funds etc.

3. DIVIDEND

The Board of Directors of the Company recommend a Dividend of Rs.1.00 per equity share aggregating to Rs. 272.84 Lacs (approx.) to the Equity shareholders of the Company for the Financial Year 2022-23.

Pursuant to the Finance Act, 2020 read with the Income-tax Act, 1961, the dividend paid or distributed by a company shall be taxable in the hands of the shareholders w.e.f. April 1, 2020. Accordingly, in compliance with the said provisions, the Company shall make the payment of dividend after necessary deduction of tax at source at the prescribed rates. For the prescribed rates for various categories, the shareholders are requested to refer to the Finance Act, 2020 and amendments thereof.

4. RESERVES

The Board in its meeting held on 17th May, 2023, proposed to carry an amount of Rs.469.73 Lacs to Statutory Reserve as per the existing provisions of the Companies Act, 2013 and Rules there under read with the Reserve Bank of India Guidelines as applicable to the Company.

5. SHARE CAPITAL

During the year under review, the Authorized Share Capital of the Company stands at Rs. 51,00,00,000/- (Rupees Fifty One Crores Only) divided into 5,10,00,000 (Five Crores Ten Lacs) Equity Shares of Rs. 10/- each and Issued, Subscribed and Paid-up Share Capital of the Company stands at Rs. 27,28,42,110/- (Rupees Twenty Seven Crores Twenty Eight Lacs Forty Two Thousand One Hundred Ten Only) divided into 2,72,84,211 (Two Crores Seventy Two Lacs Eighty Four Thousand Two Hundred Eleven) Equity Shares of Rs. 10/- each.

During the year under review, your Company has neither issued and allotted any fresh equity shares nor has granted sweat equity for the year ended 31st March, 2023.

None of the Directors of the Company hold instruments convertible into equity shares of the Company.

6. KIRAN VYAPAR LIMITED- SHARE INCENTIVE PLAN 2018 [“KVL SIP 2018”]

Members of the Company at their Extra-ordinary General Meeting (EGM) held on 30th March, 2018, have approved the Kiran Vyapar Limited -Share Incentive Plan 2018 [“KVL SIP 2018”] in compliance of the Securities and Exchange Board of India (Share Based and Employee Benefits) Regulations, 2014.

Under the KVL SIP 2018, two types of stock incentives will be awarded to the employees of the Company (and/ or of its subsidiary/holding company) as selected by the Nomination and Remuneration Committee of the Company (“NRC”) (“Eligible Employees”) being:

(a) An employee stock option scheme (“ESOS”) wherein an option will entitle an Eligible Employee to subscribe to the Equity Shares at a predetermined price (“Exercise Price”) upon fulfilment of vesting conditions; and

(b) An employee share purchase scheme (“ESPS”) wherein an Eligible Employee to whom an offer is made may subscribe to the Equity Shares at a predetermined price (“Subscription Price”). The Equity Shares issued under ESPS will be subject to lock-in.

Further, the maximum number of Equity Shares that may be issued in aggregate either by way of grant of options under ESOS or by way of an offer to subscribe to the Equity Shares under the KVL SIP 2018 shall be within an overall limit of 10% of the total issued, subscribed and paid-up equity share capital of KVL (which is 25,92,000 (Twenty-five lac ninety-two thousand) Equity Shares) as on the date of the notice of the EGM (“Overall Limit”). Any award of stock incentive under KVL SIP 2018 which may be either by way of grant of options under ESOS or offer to subscribe to the Equity Shares to the Eligible Employees which shall be determined by the NRC as per the terms of the KVL SIP 2018 (i) on a case to case basis in accordance with the terms of KVL SIP 2018; and (ii) shall be within the Overall Limit.

The Nomination and Remuneration Committee of the Company at their meeting held on 28th March, 2019 has considered and approved to make an offer to identified employee(s), subscribe to 13,64,211 (Thirteen Lacs Sixty Four Thousand Two Hundred Eleven) Equity Shares bearing face value of Rs. 10 each under the Employee Share Purchase Scheme of KVL SIP 2018; pursuant to tranche-I implementation of KVL SIP 2018.

Further, the Board of Directors of the Company at their meeting held on 29th March, 2019 has considered and approved allotment of 13,64,211 (Thirteen Lacs Sixty Four Thousand Two Hundred Eleven) Equity Shares bearing face value of Rs.10 each to employee(s) who have accepted the offer to subscribe to the Equity Shares made under the Employee Share Purchase Scheme of KVL SIP 2018; pursuant to tranche-I implementation of KVL SIP 2018 by the Company.

During the Year under review, no allotment were made under the Employee Share Purchase Scheme of KVL SIP 2018, therefore no disclosures are required to be made with respect to Employee Share Purchase Scheme (ESPS) of Kiran Vyapar Limited Share Incentive Plan 2018 of the Company (“KVL SIP 2018”) pursuant to Regulations Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014 in this Report.

The Company has not implemented Employee Stock Option Scheme (ESOS) under Kiran Vyapar Limited Share Incentive Plan 2018 till date and therefore there are no disclosures are required to be made pursuant to Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014 in relation to ESOS in this Report.

7. DEPOSITS

Your Company is an NBFC “Non-Deposit Taking Systemically Important Company” registered with Reserve Bank of India. During the year under review, your Company has not accepted any deposits from the public within the meaning under the provisions of the Master Direction - Non-Banking Financial Companies Acceptance of Public Deposits (Reserve Bank) Directions, 2016 and Chapter V of the Companies Act, 2013.

8. CHANGE IN THE NATURE OF BUSINESS

During the year under review, there were no changes in the nature of the business of the Company.

9. MATERIAL CHANGES AND COMMITMENTS

There were no material changes and commitments affecting the financial position of the Company which have occurred between the end of the financial year 31st March, 2023 and at the date of this report.

10. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR

TRIBUNALS

During the year under review, no significant and material orders were passed by the regulators or courts or tribunals impacting the going concern status and companys operations in future.

11. ANNUAL RETURN

Pursuant to Section 92(3) read with Section 134(3)(a) of the Act, the Annual Return as on 31st March, 2023 is available on the website of the Company at the link https://www.lnbgroup.com/kiran/investors.php

The final Annual Return shall be uploaded at the same weblink after the same is filed with the Registrar of Companies/ Ministry of Corporate Affairs (MCA).

12.ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EARNING/OUTGO

As your Company is a Non-Banking Financial Company and does not own any manufacturing unit, there are no particulars with regard to disclosure under Section 134 of the Companies Act, 2013 with regard to conservation of energy, technology absorption etc.

During the year under review, there is no foreign exchange earnings and outgo made by the Company.

13. DIRECTORS AND KEY MANAGERIAL PERSONNEL

a) Details of Directors retiring by rotation

In accordance with the provisions of the Companies Act, 2013, Mr. Lakshmi Niwas Bangur (DIN : 00012617) retires by rotation at the ensuing Annual General Meeting and being eligible offers himself for re-appointment.

Brief profile of Mr. Lakshmi Niwas Bangur, who is to be re-appointed is furnished in the Notice of the ensuing Annual General Meeting as per Regulation 36(3) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and Secretarial Standard-2. The Board of Directors of your Company recommends the re-appointment of Mr. Lakshmi Niwas Bangur at the ensuing Annual General Meeting.

In terms of the Regulation 17(1A) of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, Mr. Lakshmi Niwas Bangur (DIN : 00012617), a non-executive director of the Company will be attaining the age of 75 years in August 2024.

Based on the recommendation of the Nomination and Remuneration Committee and taking in account Mr. Lakshmi Niwas Bangur seniority, expertise and vast experience, which has immensely benefited the Company, the Board of Directors considered and approved the continuation of Mr. Lakshmi Niwas Bangur as a Non-executive Director of the Company, liable to retire by rotation after attaining the age of 75 years in 2024 subject to approval of shareholders at the ensuing Annual General Meeting by way of Special Resolution.

b) Appointment/ Re-appointment of Directors

(i) Mr. Bhavik Harshad Narsana (DIN : 10041603)

The Board of Directors has appointed Mr. Bhavik Harshad Narsana (DIN : 10041603) as an Additional Director (Category- Independent , Non-Executive) of the Company for a period of 5 years w.e.f. 17th May, 2023 subject to the approval of the shareholders of the Company.

Mr. Bhavik Harshad Narsana is not disqualified from being appointed as a Director as specified in terms of section 164 of the Companies Act, 2013.

Pursuant to Regulation 17 (1C) of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, the listed entity shall ensure that approval of shareholders for appointment of a person on the Board of Directors is taken at next general meeting or within a time period of three months from the date of appointment, whichever is earlier.

The Board of Directors had approved the Notice of Postal Ballot at its Board Meeting held on 17th May, 2023 for the aforesaid approval of appointment of Mr. Bhavik Harshad Narsana from Shareholders of the Company by way of Special Resolution.

(ii) Mr. Amit Mehta [DIN: 01197047)

The Board of Directors has appointed Mr. Amit Mehta [DIN: 01197047) as an Additional Director (Category- Professional, Non-Executive) pursuant to Section 161 of the Companies Act, 2013, by the Board of Directors of the Company with effect from 17th May, 2023 subject to the approval of the shareholders of the Company.

Mr. Amit Mehta [DIN: 01197047) is not disqualified from being appointed as a Director as specified in terms of section 164 of the Companies Act, 2013.

Pursuant to Regulation 17 (1C) of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015, the listed entity shall ensure that approval of shareholders for appointment of a person on the Board of Directors is taken at next general meeting or within a time period of three months from the date of appointment, whichever is earlier.

The Board of Directors had approved the Notice of Postal Ballot at its Board Meeting held on 17th May, 2023 for the aforesaid approval of appointment of Mr. Amit Mehta from Shareholders of the Company by way of Ordinary Resolution.

c) Appointment/Resignation of Key Managerial Personnel

During the year under review, no Key Managerial Personnel was appointed or has resigned during the financial year 2022-2023.

d) Fit and Proper Policy

Your Company being an NBFC “Non-Deposit Taking Systemically Important Company” registered with Reserve Bank of India has put in place a policy with the approval of the Board of Directors for ascertaining the fit and proper criteria of the directors at the time of appointment, and on a continuing basis. The Company had duly obtained a declaration and undertaking and a Deed of Covenant from the directors.

14. DECLARATION BY INDEPENDENT DIRECTORS

The Company has received declaration from the Independent Director(s) of the Company declaring that they meet the criteria of independence both, as under sub-section (6) of Section 149 of the Companies Act, 2013 and under Regulation 16 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Based on the declarations, disclosures received from the Independent Directors and on evaluation of the relationships disclosed, the following Non-executive Directors are Independent Directors in terms of the Regulation 16 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and Section 149(6) of the Companies Act, 2013.

i. Mr. Amitav Kothari ii. Mr. Bhaskar Banerjee iii. Mr. Rajiv Kapasi iv. Mr. Bhavik Harshad Narsana (w.e.f 17th May, 2023)

During the financial year 2022-23, all Independent Directors of the Company have registered themselves with the Independent Directors Databank.

In the opinion of the Board, all the Independent Directors fulfils the conditions specified in the Act with regard to integrity, expertise, and experience (including the proficiency) of the Independent Director and are independent of the management.

15. BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and Regulation 17(10) of the Listing Regulations, 2015 the Board has carried out the annual performance evaluation of the Directors individually as well as evaluation of the working of the Board and of the Committees of the Board, by way of individual and collective feedback from Directors.

Pursuant to Para VII of Schedule IV of the Companies Act, 2013 and Regulation 25 (3) of the Listing Regulations, 2015, a separate meeting of the Independent Directors of the Company was convened on 4th February, 2023 to perform the following:

• review the performance of non-independent directors and the Board as a whole;

• review the performance of the Chairperson of the Company, taking into account the views of executive directors and non-executive directors;

• assess the quality, quantity and timeliness of flow of information between the Company management and the Board that is necessary for the Board to effectively and reasonably perform their duties.

Further, the Nomination and Remuneration Committee also evaluated the performance of all the Directors of the Company.

Based on the criteria, the performance of the Board, various Board Committees and Individual Directors (including Independent Directors) were evaluated and found to be satisfactory.

During the year under review, the Independent Directors of your Company reviewed the performance of Non-Independent Directors and Chairperson of your Company, taking into account the views of Executive Director and Non-Executive Directors.

Further, the Independent Directors hold a unanimous opinion that the Non- Independent Directors, including the Chairman and Managing Director bring to the Board, abundant knowledge in their respective field and are experts in their areas. The Board as a whole is an integrated, balanced and consistent unit where diverse views are expressed when required, with each Director bringing professional domain knowledge to the table. All Directors are participative, interactive and communicative.

16. FAMILIARIZATION PROGRAMME

The Company is required to conduct the Familiarization Programme for Independent Directors (IDs) in terms of Regulation 25(7) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 to familiarize them about the Company, their roles, rights, responsibilities in the Company and various updates and notifications under Companies Act, 2013, Listing Regulations, 2015, Reserve Bank of India Guidelines and other statutes applicable to the Company.

The details of the Familiarization Programme has been given in the Corporate Governance Report annexed to this Report and also posted on the website of the Company at its web-link https://www.lnbgroup.com/kiran/investors.php

17. NUMBER OF MEETINGS OF THE BOARD OF DIRECTORS

The Board meets at regular intervals to discuss and decide on Companys business policy and strategy apart from other broad business. However, in case of a special and urgent business need, the Boards approval is taken by passing resolutions through circulation, as permitted by law, which are confirmed in the subsequent Board Meeting.

The notice of Board Meeting is given well in advance to all the Directors. The Agenda of the Board / Committee Meetings is circulated at least 7 (seven) days prior to the date of the meeting as per Secretarial Standard on meeting of the Board of Directors (SS-1). The Agenda for the Board and Committee Meetings includes detailed notes on the items to be discussed at the meeting to enable the Directors to take an informed decision.

The Board met 5 (Five) times during the financial year 2022-23. The detailed information chart showing the date of the meeting of the Board and its various Committees as well as details of the Directors who attended the meeting is given in the Corporate Governance Report forming part of the Annual Report.

18. COMMITTEES OF THE BOARD

During the financial year ended March 31, 2023 the Company has ten committees as mentioned below:

a. Audit Committee

b. Stakeholders Relationship Committee

c. Nomination and Remuneration Committee

d. Corporate Social Responsibility Committee

e. Risk Management Committee

f. Loan and Investment Committee

g. Asset Liability Management Committee

h. Grievance Redressal Committee

i. IT Strategy Committee

j. IT Steering Committee

Details of the Committees along with their charters, composition and meetings held during the year, are provided in the Corporate Governance Report, forming a part of this Annual Report.

19. LISTING

The Companys Equity shares are continued to be listed on BSE Limited (Bombay Stock Exchange). The Company has paid the Annual Listing Fees to the Stock Exchange for FY 2023-24.

20. AUDIT COMMITTEE

The Composition, terms of reference and other details of the Committee forms part of the Corporate Governance Report as annexed hereto. All the recommendations made by the Audit Committee during the year were accepted by the Board.

21. STAKEHOLDERS RELATIONSHIP COMMITTEE

The Composition, terms of reference and other details of the Committee forms part of the Corporate Governance Report, forming part of this Annual Report.

22. NOMINATION AND REMUNERATION COMMITTEE

The Composition, terms of reference and other details of the Committee forms part of the Corporate Governance Report, forming part of this Annual Report. The Nomination and Remuneration Policy is annexed hereto and forms part of this report as Annexure - “A” and also posted on the website of the Company at its weblink http:/ / www.lnbgroup.com/kiran/policies.php

23. CORPORATE SOCIAL RESPONSIBILITY (CSR) COMMITTEE

The Company has constituted a Corporate Social Responsibility (CSR) Committee in accordance with Section 135 of the Companies Act, 2013. The Annual Report on CSR activities including the details about the development of CSR Policy and initiatives taken by the Company on Corporate Social Responsibility during the year, as required by the Companies (Corporate Social Responsibility Policy) Rules, 2014 are given in the Annexure ‘B to this Report. The Corporate Social Responsibility Policy has been posted on the website of the Company at its weblink https://www.lnbgroup.com/kiran/investors.php.

The Company, along with other Group Companies, has set up a Registered Public Charitable Trust named as LNB Group Foundation to carry out CSR activities fall within the purview of Schedule VII of the Act read with the Companies (Corporate Social Responsibility Policy) Rules 2014.

24. DETAILS OF SUBSIDIARY/ JOINT VENTURES/ ASSOCIATE COMPANIES

a. Subsidiary Companies

Sl. No. Name of the Company	Relation
1 Iota Mtech Ltd.	Wholly Owned Subsidiary
2 Anantay Greenview Private Ltd.	Subsidiary
3 Sarvadeva Greenpark Private Ltd.	Subsidiary
4 Uttaray Greenpark Private Ltd.	Subsidiary
5 Sishiray Greenview Private Ltd.	Subsidiary
6 Samay Industries Ltd.	Subsidiary
7 Shree Krishna Agency Ltd.	Subsidiary
8 Amritpay Greenfield Private Ltd	Step down subsidiary
9 Divyay Greeneries Private Ltd	Step down subsidiary
10 Sarvay Greenhub Private Ltd.	Step down subsidiary
11 Basbey Greenview Private Ltd	Step down subsidiary
12 Sukhday Greenview Private Ltd.	Step down subsidiary
13 IOTA Mtech Power LLP	Step down subsidiary

During the year under review there were no change in the subsidiaries and associates of the Company during the Financial Year 2022-2023.

Policy for determining ‘Material Subsidiaries

The Company has adopted a Policy on Material Subsidiaries as approved by the Board. It has been posted on the website of the Company at https://www.lnbgroup.com/kiran/investors.php. More details are given in the Corporate Governance Report annexed hereto.

b. Associate Company

Sl. No. Name of the Company

1 Placid Ltd.

2 The Kishore Trading Co Limited

3 LNB Renewable Energy Ltd.

The statement in Form AOC-1 containing the salient features of the aforesaid subsidiaries and associates has been separately annexed hereto, in terms of the first proviso to the Section 129(3) of the Companies Act, 2013, including any subsequent amendment thereto (the ‘Act) read with Rule 5 of the Companies (Accounts) Rules, 2014. Further, the contribution of these subsidiaries to the overall performance of the Company is provided under the Notes to the Consolidated Financial Statements.

In accordance with third proviso of Section 136(1) of the Companies Act, 2013 and Regulation 46 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 the Annual Report of the Company, along with its Standalone and the Consolidated Financial Statements and financial statement of each of the subsidiaries of the Company have been posted on the website of the Company, www.lnbgroup.com/kiran.

Shareholders interested in obtaining a copy of the audited annual accounts of the subsidiary companies may write to the Company Secretary at the Companys registered office. The same is also available on the website of the Company www.lnbgroup.com/kiran.

c. Joint Venture

During the year under review, the Company had no joint ventures.

25. CONSOLIDATED FINANCIAL STATEMENTS

These consolidated financial statements has been prepared in accordance with Indian Accounting Standards notified under section 133 of the Companies Act 2013 (“The Act”), read together with the Companies (Indian Accounting Standards) Rules, 2015 as amended from time to time (‘Ind AS) along with other relevant provisions of the Act; the Master Direction Non-Banking Financial Company Systemically Important Non-Deposit taking Company and Deposit taking Company (Reserve Bank) Directions, 2016 (‘the NBFC Master Directions) issued by RBI and the regulatory guidance on implementation of Ind AS notified by the RBI vide notification dated 13 March 2020.

The Guidance Note on Division III - Schedule III issued by the Institute of Chartered Accountants of India (“”ICAI””) has been followed insofar as they are not inconsistent with any of these Directions.

These consolidated financial statements have been prepared and presented under the historical cost convention, on the accrual basis of accounting except for certain financial assets and financial liabilities that are measured at fair values at the end of each reporting period, as stated in the accounting policies. The accounting policies have been applied consistently over all the periods presented in these consolidated financial statements.

26. VIGIL MECHANISM/ WHISTLE BLOWER POLICY

The Board of Directors of the Company has established a Vigil Mechanism for Directors and employees and adopted the Whistle Blower Policy in terms of Section 177 of the Companies Act, 2013 and Regulation 22 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 to report concerns about unethical behavior, wrongful conduct and violation of Companys Code of conduct or ethics policy. The details of which have been given in the Corporate Governance Report annexed to this Report and also posted on the website of the Company at its web link https://www.lnbgroup.com/kiran/policies.php.

27. RISK MANAGEMENT

The Company has in place a mechanism to identify, assess, monitor and mitigate various risks that may impact key business objectives of your Company, including elements of risk which in the opinion of the Board may threaten the existence of the company.

Your Company has adopted the Risk Management Policy in order to ensure that all the current and future material risk exposures of the Company are identified, assessed, quantified, appropriately mitigated and managed, to establish a framework for the companys risk management process and to ensure its wide implementation, to ensure systematic and uniform assessment of risks related with giving loans and making investment, to enable compliance with appropriate regulations, wherever applicable, through the adoption of best practices and to assure business growth with financial stability.

Major risks identified by the businesses and functions are systematically addressed through mitigating actions on a continuing basis. These are discussed by Risk management Committee and the same is even referred to the Audit Committee and the Board of Directors of the Company, if required.

The composition and other details of the Risk Management Committee forms part of the Corporate Governance Report as annexed hereto.

28. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS MADE DURING THE FINANCIAL YEAR

The loan given, guarantee given and investment made by the Company during the financial year ended March 31, 2023 are within the limits prescribed under Section 186 of the Act. Particulars of the Loans/guarantee/ advances and Investments outstanding during the financial year are fully disclosed in the Note no. 30 attached to the annual accounts which are attached with this report.

29. RELATED PARTY TRANSACTIONS

There were no materially significant related party transactions entered into by the Company which may have potential conflict with the interest of the Company. All contracts or arrangements or transactions entered by the Company during the financial year with related parties were in the ordinary course of business and on arms length basis and are reviewed by the Audit Committee of the Board.

Further, suitable disclosure as required by the Accounting Standards has been made in the Notes to the Financial Statements.

During the year under review, the Company has not entered into contracts or arrangements or transactions with related parties which comes under the purview of Section 188 of the Companies Act, 2013. Accordingly, no transactions are reported in Form no. AOC 2 in terms of Section 134 of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts), Rules, 2014.

The Policy on Related Party Transaction as approved by the Board has been posted on the website of the Company at its web link https://www.lnbgroup.com/kiran/investors.php.

Further, as required by Schedule V of SEBI (LODR) Regulations, 2015, disclosures of transactions with any person or entity belonging to the promoter/promoter group which hold(s) 10% or more shareholding in the Company in the format prescribed in the relevant Accounting Standards, has been made in the relevant Notes to the Financial Statements.

30. PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES

In terms of the provisions of Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 the details are annexed as “Annexure C” to the Annual Report.

Further, in accordance with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, there are no employees in the Company drawing remuneration in excess of the limits set out in the said rules.

31. SECRETARIAL AUDIT REPORT

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors of the Company has appointed M/s Vinod Kothari & Co, Practicing Company Secretaries, to conduct the Secretarial Audit for the financial year 2022-2023. The Secretarial Audit Report for the Financial Year 2022-2023 is annexed hereto and forms part of this report as “Annexure D” which is self-explanatory. The said Report does not contain any qualification, reservation or adverse remark.

Pursuant to Regulation 24A of Listing Regulations read with SEBI Circular No. SEBI/LAD-NRO/GN/2021/22 dated May 05, 2021, the Secretarial Audit Reports of Material Subsidiaries of the Company are annexed which forms part of this Report and are uploaded on the website of the Company i.e. https://www.lnbgroup.com/kiran/investors.php.

32. STATUTORY AUDITORS

M/s B. Chhawchharia & Co, Chartered Accountants, (Firm Registration Number: 305123E) have been appointed as the Statutory Auditors of the Company for a period of 2 (two) years from the conclusion of the 26th Annual General Meeting till the conclusion of the 28th Annual General Meeting.

33. INTERNAL AUDITORS

The Board of Directors at its meeting held on 17th May, 2023 has appointed M/s. Lakhotia & Co., Chartered Accountant, Kolkata as Internal Auditor of the Company for the financial year 2023-24. Further, the Audit Committee considers and reviews the Internal Audit Report submitted by the Internal Auditor on a quarterly basis.

34. AUDITORS REPORT

The notes on financial statements referred to in the Auditors Report are self-explanatory and do not call for any further comments. The Auditors Report does not contain any qualification, reservation or adverse remark.

35. MANAGEMENT DISCUSSION AND ANALYSIS REPORT

The Managements Discussion and Analysis Report for the year under review, as stipulated under Regulation 34(2)(e) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and Master Direction -Non-Banking Financial Company - Systemically Important Non-Deposit taking Company and Deposit taking Company (Reserve Bank) Directions, 2016 forms part of the Annual Report.

36. CORPORATE GOVERNANCE

The Company is committed to maintaining the premier standards of Corporate Governance and adhering to the Corporate Governance requirements as set out by Securities and Exchange Board of India and Reserve Bank of India. The Report on Corporate Governance as stipulated under Regulation 34(3) read with Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and Master Direction - Non-Banking Financial Company - Systemically Important Non-Deposit taking Company and Deposit taking Company (Reserve Bank) Directions, 2016 and RBI Circular No. RBI/2022-23/26 DOR.ACC.REC. No. 20/21.04.018/2022-23, dated - April 19, 2022 forms part of the Annual Report.

The Certificate from M/s Vinod Kothari & Company, Practicing Company Secretaries confirming compliance with the Regulation 34(3) read with Schedule V of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 of Corporate Governance also forms part of this Annual Report.

Further, declaration by Mr. Shreeyash Bangur, Managing Director stating that the members of the Board of Directors and Senior Management Personnel have affirmed compliance with the Code of Conduct of the board of Directors and Senior Management are annexed with this Report.

37. PREVENTION OF INSIDER TRADING

The Code of Practices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information is also available on the website of the Company viz., http://www.lnbgroup.com/kiran/investors.php

38. MANAGING DIRECTOR & CFO CERTIFICATION

Certificate from Mr. Shreeyash Bangur, Managing Director and Mr. Laxmi Narayan Mandhana, Chief Financial Officer, pursuant to Regulation 17(8) read with Schedule II of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 for the year under review forms part of this Annual Report.

39. ANNUAL SECRETARIAL AUDIT UNDER LISTING REGULATIONS

In line with the SEBI Circular dated February 08, 2019, an Annual Secretarial Compliance Report confirming compliance of all applicable SEBI Regulations, Circulars and Guidelines by the Company was issued by appointed secretarial auditor M/s Vinod Kothari & Company, Practicing Company Secretaries and was filed with the Stock Exchange.

Pursuant to Regulation 24A of Listing Regulations read with SEBI Circular No. SEBI/LAD-NRO/GN/2021/22 dated May 05, 2021, The Secretarial Audit Report of Material Subsidiaries of the Company forms part of this Report and are uploaded on the website of the Company i.e. https://www.lnbgroup.com/kiran/investors.php.

40. DIRECTORS RESPONSIBILITY STATEMENT

In terms of the provisions on the Directors Responsibility Statement referred in Section 134(3)(c) and 134 (5) of the Companies Act, 2013, your Directors confirm that -

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

(b) the directors had 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 of the Company for that period;

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

(d) the directors had prepared the annual accounts on a going concern basis; and

(e) 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.

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

41. ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS

The Directors had laid down internal financial controls procedures to be followed by the Company which ensure compliance with various policies, practices and statutes in keeping with the organizations pace of growth and increasing complexity of operations for orderly and efficient conduct of its business. The Audit Committee of the

Board, from time to time, evaluated the internal financial control of the Company with regard to-

a. Systems have been laid to ensure that all transactions are executed in accordance with managements general and specific authorization. There are well laid manuals for such general or specific authorization.

b. Systems and procedures exist to ensure that all transactions are recorded as is necessary to permit preparation of financial statements in conformity with generally accepted accounting principles or any other criteria applicable to such statements, and to maintain accountability for aspects and the timely preparation of reliable financial information.

c. Access to assets is permitted only in accordance with managements general and specific authorization. No assets of the Company are allowed to be used for personal purposes, except in accordance with terms of employment or except as specifically permitted.

d. The existing assets of the Company are verified/ checked at reasonable intervals and appropriate action is taken with respect to any differences, if any.

e. Proper Systems are in place for prevention and detection of frauds and errors and for ensuring adherence to the Companys policies.

Based on the above, your Board is of the view that adequate internal financial controls exist in the Company.

42. SECRETARIAL STANDARD

The Company complies with all the applicable Secretarial Standard.

43. DISCLOSURES UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION & REDRESSAL) ACT, 2013

The Company has in place policy on Prevention of Sexual Harassment of Women at workplace in line with the requirements of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. An Internal Complaint Committee has been set up to redress complaints received. All employees (permanent, contractual, temporary, trainees) are covered under this policy. The Committee has not received any compliant from any employee during the financial year 2022-23.

44. FRAUD REPORTING

There have been no frauds reported by the auditors of the Company under sub-section (12) of section 143 of the Companies Act, 2013 (amended form time to time) to Central Government.

45. RBI GUIDELINES - COMPLIANCE

The Company continues to carry on its business of Non-Banking Financial Company as a Non-Deposit taking Company and follows prudent financial management norms as applicable. The Company appends a Statement containing particulars as required in terms of Paragraph 18 of Master Direction - Non-Banking Financial Company - Systemically Important Non-Deposit taking Company and Deposit taking Company (Reserve Bank) Directions, 2016 alongwith the Statement of Balance Sheet disclosures for NBFCs with Assets Size of Rs. 500 crores as required in terms of Master Direction - Non-Banking Financial Company - Systemically Important Non-Deposit taking Company and Deposit taking Company (Reserve Bank) Directions, 2016.

The Company has been identified as NBFC-Middle Layer category under Scale Based Regulation (SBR), a Revised Regulatory Framework for NBFCs as per the list issued by RBI Kolkata as on 31st March 2023, pursuant to RBI Circular No. RBI/2021-22/112 DOR.CRE.REC. No. 60/03.10.2021/2021-22, dated October 22, 2021.

46. TRANSFER OF SHARES AND UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND

Pursuant to the applicable provisions of the Companies Act, 2013, read with the IEPF Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 (‘the Rules), all unpaid or unclaimed dividends are required to be transferred by the Company to the IEPF established by the Government of India, after the completion of seven years. Further according to the Rules, the shares on which dividend has not been paid or claimed by the shareholders for seven consecutive years or more shall also be transferred to the demat account of the IEPF Authority. Accordingly, the Company has transferred the unclaimed and unpaid dividends of Rs. 1,92,655/- for the financial year 2014-15 to IEPF Authority during the financial year 2022-23. Further no Shares were liable to get transferred to IEPF Authority as per the requirement of the IEPF rules.

The members who have a claim on above dividends and shares may claim the same from IEPF Authority by submitting an online application in web Form No. IEPF-5 available on the website www. iepf.gov.in and sending a physical copy of the same, duly signed to the Company, along with requisite documents enumerated in the Form IEPF-5. No claims shall lie against the Company in respect of the dividend / shares so transferred.

47. DETAILS OF APPLICATION MADE OR ANY PROCEEDING PENDING UNDER THE INSOLVENCY AND BANKRUPTCY CODE, 2016 (31 OF 2016) DURING THE YEAR ALONGWITH THEIR STATUS AS AT THE END OF THE FINANCIAL YEAR.

During the year under review, there were no applications has been made and no proceeding is pending under Insolvency and Bankruptcy Code, 2016.

48. 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.

During the year under review, there were no one-time settlement with the Banks or Financial Institutions ,therefore there is no instance of difference between amount of valuation done at the time of one time settlement and the valuation done while taking loan.

49. MAINTENANCE OF COST RECORDS

The provisions of Section 148 of the Companies Act, 2013, with respect to maintenance of Cost records are not applicable on the Company.

50. ACKNOWLEDGEMENTS

Your Directors would like to record their appreciation of the hard work and commitment of the Company employees and are grateful for the co-operation and support extended to the Company by the Bankers, Statutory Authorities, Financial Institution(s) and all other establishments connected with the business of the Company.