CitiPort Financial Services Ltd Management Discussions

ANNEXURE - A

INDUSTRY STRUCTURE AND DEVELOPMENTS:

NBFC & GROWTH:

NBFCs being financial intermediaries are engaged in the activity of bringing the saving and the investing community together. In this role they are perceived to be playing a complimentary role to banks rather than competitors, as it is a known fact that majority of the population in the country do not yet have access to mainstream financial products and services including a bank account. Therefore, the country needs institutions beyond banks for reaching out in areas where banks presence may be lesser. Thus, NBFCs have carved niche business areas for them within the financial sector space and are also popular for providing customized products. In short, NBFCs bring the much-needed diversity to the financial sector thus diver- sifying the risks, increasing liquidity in the markets thereby promoting financial stability and bringing efficiency to the financial sector.

OPPORTUNITIES AND THREATS:

The NBFC sector has great potential to grow further and the Government of India is also focusing on their development and expansion in rural areas. The recent steps by the Government of India to create Infrastructure for NBFC and to provide banking license for NBFCs is a positive signal and the emergence of REMF (Real Estate Mutual Funds) & REIT (Real Estate Investment Trust) has brought new scope for funding in Real Estate Sector.

However, NBFCs do play a critical role in participating in the development of an economy by development in sectors like transport, employment generation, wealth creation, bank credit in rural segments and to support financially weaker sections of the society. Emergency services like financial assistance and guidance is also provided to the customers in the matters pertaining to insurance.

SEGMENT-WISE OR PRODUCT-WISE PERFORMANCE:

The Company is engaged primarily in the business of lending operations. Its activities are focused on providing credit facilities to individuals, small and medium enterprises, and other business entities. The Company has been strengthening its credit appraisal systems and risk management practices to ensure healthy asset quality and sustainable growth. The lending portfolio continues to remain diversified across various categories of borrowers, enabling the Company to maintain stability in operations and mitigate concentration risks.

The lending portfolio of the Company is diversified across various borrower categories, which enables it to maintain a balanced mix of exposures and reduce concentration risks. The Company has been continuously focusing on strengthening its credit appraisal systems, risk assessment processes, and monitoring mechanisms to ensure the quality of its loan book.

The Company also places emphasis on prudent lending practices and efficient recovery mechanisms. This approach has helped in sustaining operational stability while supporting the financial needs of its customers. The focus remains on expanding the lending base in a calibrated manner while maintaining adequate controls on asset quality and risk management.

RISKS AND CONCERNS:

Being in the financial services business has its own typical risks and the Company takes full cognizance of the fact that these risks can have a serious impact on the operations of the Company as well as its profitability. In order to ensure that the impact of risks is minimal, the Company lays utmost importance on scanning the external environment regularly. The Company also has adequate risk identification.

To mitigate the risks affecting the growth and profitability the company has directed its efforts for risk management by employing the people who are expertise and trying to initiate new technology. The company is constantly engaged in innovating its methods and procedure of risk management.

INDUSTRY OUTLOOK:

NBFCs have become important constituents of the financial sector and have been recording higher credit growth than scheduled commercial banks (SCBs) over the past few years. NBFCs are leveraging their superior understanding of regional dynamics and customised products and services to expedite financial inclusion in India. Lower transaction costs, quick decision making, customer orientation and prompt service standards have typically differentiated NBFCs from banks. Considering the reach and expanse of NBFCs, they are well-suited to bridge the financing gap in a large country like India. Systemically Important NBFCs have demonstrated agility, innovation, and frugality to provide formal financial services to millions of Indians.

COMPANY OUTLOOK

The company has profit during the financial year 2024-25. The board of directors of your company feel that the economy will improve still in the coming years providing the greater chance for your company to grow further. Moreover, Indian Government took many initiatives programs which will promote industry to come with many opportunities and chance to grow further in coming years. Your company is actively engaged in introducing innovative and customized products for the customers. The management of your company is making all efforts in finding new areas and markets for exploring the companys products and services.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:

The Company has proper and adequate internal control systems to ensure that all the assets are safeguarded and that all transactions are authorized recorded and reported correctly. Regular internal audits and checks are carried out to ensure that the execution of approved activities is in line with the policies and processes in place and that the systems are adequately strengthened to ensure compliance. Internal audit cover verification of Loan & Security creations documents, repayments, Credit Evaluation, as also process audits of various functions & Systems Audits.

The Board of Directors has been entrusted with the responsibility of reviewing the findings and to investigate and take necessary actions wherever required.

HUMAN RESOURCES/ INDUSTRIAL RELATIONS:

The Company recognizes that its success is deeply embedded in the success of the human resources. The Company has significantly scaled up its activities through investment in people and infrastructure. The Company nurtures its employees as its critical assets through healthy working atmosphere that ensures equal opportunity for growth and challenge to all the employees. The Company believes in creating business leaders by employing best talent in the industry, providing opportunities, empowerment by delegations, training and taking care of their growth. As our business grows, we would continue to expand the human resources which are fundamental to the financial services business.

DISCUSSION ON FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE: Discussion on Financial Performance with respect to the Operational Performance: i. Total Income as on 31st March, 2025 is 36.48 Lakhs ii. Share Capital: The Paid-up Share Capital as on 31st March,2025 is 310 Lakhs iii. Net Profit as on 31st March, 2025 is 2.73 Lakhs iv. Earnings per Share (EPS) as on 31st March, 2025 is 0.09

The Earnings per share for the Financial Year 2024-25 is Rs. 0.09 Per share (Face value: Rs.10/- each). Your Directors are putting continuous efforts to increase the performance of the company and are hopeful that the performance in coming year will overcome from the present situation.

DISCLOSURE OF ACCOUNTING TREATMENT:

The Company has prepared financial statements which comply with Ind-AS applicable for periods ending on March 31, 2025, together with the comparative period data as at and for the year ended March 31, 2025, as described in the summary of significant accounting policies. Primarily, a treatment different from that prescribed in an Accounting Standard has not been followed in the preparation of financial statements. However, as regards amendments to certain accounting standards, the applicability / effect on the financial statement has been evaluated and been treated accordingly as explained in Notes to the standalone Financial Statements.

CAUTIONARY STATEMENT:

Statements in this management discussion analysis describing the Companys objectives, projections, estimates, expectations may be forward looking within the meaning of applicable securities-laws and regulations. Actual results may differ materially from those expressed in the statement. Important factors that could make difference to Companys operations include economic conditions affecting the domestic market and the overseas markets in the company operates, changes in the Government regulations, Tax Laws and other statutes and other incidental factors.

		By order of the Board
		For CITI PORT FINANCIAL SERVICES LTD
	Sd/-	Sd/-
	Enjamuri Pardha Saradhi	Himabindu Ramavath
	Chairman and Managing Director	Director
	DIN :- 07531047	DIN:- 00004936
Place: Hyderabad
Date : 22.08.2025