Comfort Fincap Ltd Management Discussions

> GLOBAL ECONOMIC OVERVIEW

In 2024, the global economy expanded by 3.2%, sustaining its growth trajectory despite ongoing geopolitical tensions. However, this growth was uneven across regions. The United States maintained strong momentum, while the Eurozone experienced slower economic progress. Disinflation persisted globally, though the pace of improvement varied, with some countries still grappling with elevated inflation levels.

Looking ahead, global growth is projected to moderate to 2.8% in 2025 and 3.0% in 2026, as rising trade tensions and heightened policy uncertainty weigh on the outlook. A key concern is the recent imposition of tariffs by the new U.S. administration on Canada, Mexico, and China, which has triggered retaliatory measures. These developments pose risks to global trade flows, inflation stability, and overall economic momentum.

Amid these challenges, restoring clarity and policy coordination is critical. Global cooperation will be essential to foster a stable and predictable trade environment, facilitate timely debt restructuring, and address shared macroeconomic vulnerabilities. At the same time, countries must focus on domestic policy reforms and correct structural imbalances to preserve internal stability.

Such a balanced and coordinated approach will help manage the trade-off between growth and inflation, rebuild financial resilience, improve long-term growth potential, and reduce systemic risks in the global economy.

(Source: IMF)

Fueling the Future: Indias Ascent to the Top 4 Global Economies

As per the International Monetary Fund ("IMF") projections, India is poised to become the worlds fourth-largest economy in 2025, alongside Japan. The countrys economic strength is underpinned by key sectors such as traditional and modern agriculture, technology and IT services, the handicraft industry, and business process outsourcing ("BPO").

Indias real Gross domestic product ("GDP") is estimated at Rs. 187.95 lakh crore in Financial Year 2024-25, up from Rs. 176.51 lakh crore in Financial Year 2023-24, supported by a population exceeding one billion-positioning India among the largest population-driven economies globally. Furthermore, the IMF forecasts a robust GDP growth rate of 6.2% and 6.3% for Financial Year 2024-25 and Financial Year 2025-26 respectively, making India the fastest- growing major economy during this period.

Looking ahead, rising domestic consumption and increased investment flows—both foreign and domestic—are expected to be key drivers of economic expansion. These factors will not only fuel sustainable growth but may also enable India to ascend further in the global GDP rankings in the coming years.

Table: Region-wise GDP Growth Rate (%)

REGIONS	PROJECTIONS
	2024	2025	2026
World Economy	3.3	2.8	3.0
Advanced Economies (AEs)	1.8	1.4	1.5
United States	2.8	1.8	1.7
Euro Area	0.9	0.8	1.2
Germany	-0.2	0.0	0.9
Japan	0.1	0.6	0.6
United Kingdom	1.1	1.1	1.4
Emerging Market and Developing Economies (EMDEs)	4.3	3.7	3.9
China	5.0	4.0	4.0
India	6.5	6.2	6.3
Russia	4.1	1.5	0.9

(Source: IMF World Economic Outlook April 2025)

> INDIAN FINANCIAL SERVICES SECTOR

Over the past decade, India has made substantial progress in the digital transformation of financial governance and regulatory oversight. This evolution has laid a strong foundation for enhanced transparency, accountability, and operational efficiency across the financial sector.

The Union Budget 2025 reinforces this trajectory by introducing two pivotal initiatives designed to strengthen compliance frameworks, bolster financial security, and promote greater transparency within the financial ecosystem. These measures are particularly focused on empowering Banking, Financial Services, and Insurance (BFSI) institutions to proactively detect, prevent, and mitigate risks associated with money laundering, financial fraud, and regulatory non-compliance.

By leveraging advanced digital infrastructure, data analytics, and real-time monitoring systems, the government aims to foster a more robust and resilient financial environment. These efforts are expected to not only safeguard the integrity of financial transactions but also enhance investor confidence, promote responsible financial practices, and align with global standards of financial governance.

Going forward, such digital-led reforms are likely to serve as a catalyst in accelerating Indias journey towards a more secure, transparent, and technology-driven financial architecture.

(Source:https://assets.kpmg.com/content/dam/kpmgsites/in/pdf/2025/02/financial-services-pov-union-

budget-2025-26.pdf.coredownload.pdf)

Shaping the Future of Finance: The Expanding Role of NBFCs in Indias Digital Economy

As stated above, Non-Banking Financial Companies ("NBFCs") are expanding faster than Indias overall economic growth. From Financial Year 2019 to Financial Year 2024, credit growth by NBFCs is estimated to have grown by a compounded annual growth rate ("CAGR") of 12%. Their assets under management ("AUM") have significantly increased from less than Rs. 2,00,000 crore (US$ 23.74 billion) around the year 2000 to Rs. 43,00,000 crore (US$ 510.39 billion) by the end of Financial Year 2024. This trend is expected to continue in Financial Year 2025, supported by a rapid revival in the Indian economy and rising consumer demand. Unlike banks, which primarily focus on wholesale lending to large corporates, services, and agriculture sectors, NBFCs have entered retail lending, with 48% of their total credit going to the retail segment, compared to only 34% of total bank credit in Financial Year 2024.

NBFCs have played a crucial role in driving financial inclusion in India. With strong grassroots connections, they cater to people in rural and semi-urban areas who are either unbanked or under banked. They also lend to those without formal credit histories, such as workers in the informal sector. This focus on individual borrowers, especially those from low-income or riskier profiles, makes them an important part of the countrys financial ecosystem. The report suggests that NBFCs will continue to grow rapidly, playing a critical role in bridging financial access gaps across the country and supporting the governments broader financial inclusion goals.

(Source: https://www.ibef.org/news/nbfcs-will-continue-to-grow-at-a-faster-pace-have-grown-above-india- s-gdp-historically-report)

Further, the RBIs Master Direction on IT Governance, Risk, Controls and Assurance, effective from April 1, 2024, provides a unified and comprehensive framework for enhancing cybersecurity, IT governance, and operational resilience across banks and NBFCs (Middle, Upper, and Top Layers). It mandates the establishment of dedicated IT governance structures such as an IT Strategy Committee, appointment of a Chief Information Security Officer (CISO), and adoption of formal IT risk management, data protection, and cybersecurity protocols. The direction emphasizes regular risk assessments, audit trails, cryptographic controls, and stringent vendor risk oversight to ensure robust security across all digital financial operations.

This directive is a significant step toward standardizing IT practices across Indias financial sector, bringing NBFCs in line with banks in terms of regulatory expectations. It aims to reduce systemic vulnerabilities, safeguard consumer data, and enhance the overall resilience of the financial ecosystem in an increasingly digitized environment.

(Source: https://www.rbi.org.in/Scripts/BS ViewMasDirections.aspx?id=12562)

KEY REASONS FOR GROWTH

Financial Inclusion and Last-Mile Connectivity

NBFCs have a strong presence in rural and semi-urban areas, serving customers often excluded from the traditional banking system. Their ability to cater to the unbanked and underbanked population, including small entrepreneurs and informal workers, has significantly expanded their reach.

Rising Consumption and Credit Demand

Indias expanding middle class, increasing consumerism, and growth in sectors like real estate, infrastructure, and small businesses have driven demand for credit-areas where NBFCs have efficiently positioned themselves.

Diversification of Funding Sources

NBFCs have successfully diversified funding beyond traditional bank loans through debentures, securitization, and foreign investments, helping them scale operations and manage liquidity better.

Regulatory Support and Sectoral Reforms

The Reserve Bank of India (RBI) has supported NBFC growth through a structured regulatory framework, promoting innovation while safeguarding financial stability. Initiatives like the harmonization of NBFC norms with banks have enhanced trust and transparency. NBFCs offer tailored financial products with simpler documentation and faster disbursal, especially in retail lending, microfinance, vehicle loans, and SME financing. Their flexible credit norms attract borrowers who may not qualify for bank loans.

Economic Growth and Urbanization

Indias steady economic growth, increasing urbanization, and a young population have contributed to a greater appetite for credit, which NBFCs are efficiently capitalizing on.

Focus on Underserved Segments

NBFCs have strategically focused on niche segments such as micro-enterprises, used vehicle financing, affordable housing, and education loans-filling the gap left by traditional banks.

Digital Adoption and Technology Integration

The sector has embraced digital lending, data analytics, AI, and fintech partnerships, enabling better customer onboarding, faster credit appraisal, and cost-effective operations-particularly critical during and after the pandemic.

Customized Products and Flexible Lending

NBFCs offer tailored financial products with simpler documentation and faster disbursal, especially in retail lending, microfinance, vehicle loans, and SME financing. Their flexible credit norms attract borrowers who may not qualify for bank loans.

> ABOUT COMFORT FINCAP LIMITED BUSINESS OVERVIEW

The Company was originally incorporated as Parasnath Textiles Limited ("PTL") on November 12, 1982 under the Companies Act, 1956 in the State of West Bengal. Initially, the objects of the Company were to carry on the business of manufacturers and dealers in textiles, investment /trading in shares & securities. The Company is registered with Reserve Bank of India ("RBI") as a NBFC on September 15, 1998 being Registration No. 05.02895 and started a NBFC as its core business. Thereafter, the Companys name is changed from Parasnath Textiles Limited to Comfort Fincap Limited with effect from June 04, 2011.

The Comfort Fincap Limited (CFL or Company or We) is a non-deposit taking Non-Banking Financial Company ("NBFC-ND") registered with the RBI and is classified as an NBFC-Investment and Credit Company (NBFC-ICC). Our Company is primarily focused in providing inter corporate loans, personal loans, loans against shares & securities, loans against properties, trade financing, bills discounting, trading in shares & securities. The Company has positioned itself between the organized banking sector and local money lenders, offering the customers competitive, flexible and timely lending services.

> PRODUCTS & SERVICES

Your Company is a Non-Banking Financial Company ("NBFC") engaged in providing a wide spectrum of financial services to commercial, industrial, and financial sector clients. We offer a comprehensive suite of financial solutions under one roof, enabling businesses and individuals to meet their diverse funding and financial management requirements in a seamless and efficient manner.

As an NBFC, we play a critical role in bridging the credit gap within the economy by extending financial support to under-served and niche segments that often face challenges in accessing traditional banking channels. Through tailored products and customer-centric services, we aim to enhance financial inclusion, empower entrepreneurs, and promote economic growth.

Our offerings are designed to address both short-term and long-term financial needs, ranging from working capital finance, loans, and investment solutions to advisory and structured financing services. By combining flexibility, innovation, and deep market understanding, we are positioned to serve as a trusted partner for our clients growth and expansion journeys.

We operate with a focus on prudent risk management, regulatory compliance, and ethical business practices, thereby ensuring the sustainability of our business model while delivering value to all stakeholders. With a strong commitment to excellence, we continue to strengthen our role as an enabler of credit flow, supporting sectors and communities that form the backbone of the economy.

SUPPLY CHAIN FINANCE

Your Company offers robust Supply Chain Finance (SCF) solutions that are specifically designed to strengthen business ecosystems by supporting both buyers and suppliers across industries. By acting as a trusted financial partner, we provide innovative structures that align the interests of all stakeholders in the value chain.

Through this service, suppliers gain access to early payments at competitive financing rates, thereby unlocking tied-up capital, improving their cash flows, and reducing dependency on costly borrowings. On the other hand, buyers benefit from extended credit periods that enhance their working capital cycle without straining supplier relationships. This dual advantage fosters efficiency, financial stability, and long-term collaboration between trading partners.

Our Supply Chain Finance model creates a win-win framework that not only optimizes liquidity management but also promotes resilience and agility in supply chains. By reducing financial stress, ensuring timely settlements, and improving transparency, we help businesses maintain smooth operations, strengthen trust among partners, and achieve sustainable growth.

"In essence, our Supply Chain Finance services are more than just a financial offering—they are a strategic enabler of business continuity, stronger partnerships, and economic value creation across the supply chain ecosystem."

LOAN AGAINST SECURITIES

Your Company offers specialized Loan Against Securities (LAS) solutions, enabling clients to unlock the value of their financial investments without liquidating them. By pledging marketable securities such as equity shares, mutual fund units, bonds, and other eligible instruments, clients can access short-term liquidity while continuing to retain ownership and all associated corporate benefits, including dividends, bonuses, and rights issues.

This facility is designed to meet immediate funding requirements be it for personal, business, or investment purposes without disrupting long-term investment strategies. Interest is levied only on the actual amount drawn and for the duration of its utilization, providing flexibility and cost efficiency.

It includes various financial tools as follows:

Margin Funding

Margin Funding is a strategic offering that enables investors to enhance their purchasing power in the capital markets by leveraging approved securities. This facility allows clients to invest in additional securities by contributing a portion of the transaction value, while the balance is funded by the NBFC, based on a pre-defined margin and haircut structure.

Under this facility, investors can either bring in a cash margin or pledge eligible securities from a pre-approved list. The margin requirement is determined after applying regulatory and risk-based haircuts, ensuring prudent risk management. This approach allows clients to optimize capital deployment without liquidating their long-term holdings.

Bill Discounting

Bill Discounting helps businesses unlock the value of their receivables and maintain smooth cash flow. Our service involves the purchase of bills of exchange or promissory notes before their maturity date, providing you with immediate access to funds rather than waiting for your customer to make payment.

Once the bill is verified and approved, we credit the discounted value directly to your account—often within a short turnaround time. This empowers your business to manage operations, pay suppliers, or seize new opportunities without delay.

Eligible bills can be used to secure financing of up to 90% of the invoice

value, subject to credit assessment and approval. The invoice itself serves as security, typically eliminating the need for additional collateral.

Inter-Corporate Loan

Inter-corporate loan tailored to meet the diverse and evolving financial needs of businesses. These loans are designed to support various stages of corporate growth, from daily operations to long-term strategic expansion. We provide working capital loans that help companies manage their routine operational expenses efficiently, ensuring smooth day-to-day

functioning without liquidity stress. For businesses planning, Comfort Fincap Limited Company X

capital investments such as plant expansion, equipment purchase, or infrastructure development, our term loans offer a dependable funding solution with structured repayment schedules.

We also cater to companies in need of quick access to funds through our bridge loan facilities, which are ideal for addressing temporary cash flow gaps or for financing projects that are awaiting long-term funding. For more extensive and capital-intensive ventures, our project finance solutions offer customized structures that align with the scope, scale, and lifecycle of the initiative.

All our inter-corporate loan products are offered at competitive interest rates, with flexible tenures and customized repayment options designed to align with each clients financial strategy. Our team works closely with businesses to understand their requirements and structure solutions that support long-term sustainability and success. With a focus on responsiveness, transparency, and financial discipline, we aim to be a trusted lending partner in your organizations journey toward growth and efficiency.

ESOP Finance

Employees who hold Employee Stock Ownership Plans (ESOPs) from their employers and wish to exercise their stock options can benefit from our specialized ESOP financing solutions. These loans are designed to provide employees with the necessary funds to purchase shares allotted to them under their companys ESOP scheme—without the need to liquidate personal assets or dip into savings.

Our ESOP finance offering is structured on competitive terms, with attractive interest rates, flexible repayment schedules, and minimal processing time. Whether the employee is part of a startup on the verge of an IPO or a senior executive in a mature enterprise, we enable timely access to capital so that they can participate in their companys equity growth.

This form of financing is particularly useful when employees face a short

window to exercise their options or when the tax liabilities associated with ESOPs become due at the time of exercise. With our support, employees can unlock long-term wealth creation opportunities while managing immediate financial commitments more effectively.

IPO Financing

IPO Financing offers an effective avenue for investors to capitalize on opportunities in the primary equity markets by leveraging short-term funding. We provide structured IPO financing solutions to corporate entities and high net worth individuals (HNIs), enabling them to enhance their subscription capacity in initial public offerings with minimal upfront capital.

Under this facility, clients are required to contribute only a margin amount, while the balance of the application value is funded by us. This significantly increases the potential allotment size without tying up substantial liquidity.

Our financing process is streamlined for speed, compliance, and efficiency— ensuring clients can act swiftly on high-demand IPOs. With our support, investors can take advantage of attractive market opportunities and maximize their participation in promising listings, while managing capital deployment strategically.

Trade Financing

Trade Financing Solutions is designed to support businesses engaged in domestic and international trade. Our services aim to bridge the working capital gap between shipment of goods and receipt of payment, enabling smooth, uninterrupted trade cycles. /

Whether you are an importer, exporter, manufacturer, or distributor, our structured trade finance products help optimize cash flows and mitigate transactional risks. *

Our offerings include facilities such as pre-shipment finance, post-shipment finance, letter of credit (l_C) backed funding, bill discounting, invoice financing, and supply chain finance. These ^ solutions are tailored to meet the specific requirements of your trade operations, ensuring timely access to funds, enhanced credit flexibility, and improved negotiation power with buyers and suppliers.

With a focus on speed, transparency, and risk management, our trade finance solutions are supported by experienced professionals who understand the intricacies of cross-border and domestic transactions.

"Our Loan against Securities solution enables you to unlock the value of your investments without the need to liquidate them."

LOAN AGAINST PROPERTY

A Loan against Property (LAP) is a powerful financial tool that allows you to unlock the value of your owned real estate to meet a wide range of personal or business needs. We provide fast and affordable mortgage loan solutions that enable you to leverage your residential, commercial, or industrial property to access substantial funding while retaining ownership of your asset.

Our mortgage loans are available to salaried individuals, self-employed professionals, and business owners, with customized structures to suit varying income profiles and repayment capacities. The loan amount is determined based on the market value of the property, typically up to a significant percentage, ensuring you get the funds you need when you need them most. With our support, you can achieve financial peace of mind and move forward with confidence.

"We believe your property is more than just a physical asset—its a gateway to fulfilling your ambitions." PROMOTER FUNDING

Your Company offer strategic Promoter Funding solutions that enable promoters of well-managed and financially sound companies to unlock the value of their shareholding. This facility allows promoters to raise capital by pledging their equity stake in the operating company, without diluting ownership or disrupting management control.

Promoter Funding can be utilized for a wide range of business needs, including expansion of operations, acquisitions, takeover financing, or meeting working capital requirements. It serves as an effective tool for promoters to access liquidity while maintaining alignment with the long-term vision of the company.

Our offering is structured with a deep understanding of capital markets, ensuring flexible loan structures, competitive interest rates, and robust risk assessment frameworks. We work closely with promoters to tailor solutions that align with regulatory norms, market dynamics, and business objectives, providing both discretion and efficiency throughout the funding process.

"With our promoter funding solutions, promoters can act decisively in pursuit of strategic initiatives, with the confidence of a reliable financing partner."

SWOT ANALYSIS

During the financial year 2024-25, our company successfully navigated a dynamic and often challenging market environment by strategically leveraging our core strengths. We maintained operational resilience through prudent financial management and reinforced stakeholder confidence by safeguarding the integrity of our balance sheet.

In response to evolving market demands and increasing digitalization, we adopted new technologies across key business functions—enhancing operational efficiency, improving customer experience, and ensuring scalability for future growth. These initiatives have positioned us well to capitalize on emerging opportunities while mitigating risks associated with economic and regulatory shifts.

STRENGHTS

Strong Relationships with Banks, Institutions, and Investors

We have established deep relationships with leading public and private banks, financial institutions, and investors, ensuring reliable access to capital, strategic partnerships, and valuable market insights.

Clear and Scalable Organizational Structure

Our well-defined and scalable organizational structure supports efficient decision-making, clear role allocation, and seamless adaptation to business growth and changing market conditions.

Diversification of Financial Services through Innovation

We continuously innovate and expand our financial service offerings to meet evolving market demands. This diversification enhances our competitiveness and helps capture new customer segments.

Experienced Senior Management Team

We continuously innovate and expand our financial service offerings to meet evolving market demands. This diversification enhances our competitiveness and helps capture new customer segments.

Technology- Driven Lending

Leveraging advanced technologies capabilities, including data analytics, A I, and digital lending platforms, to optimise customer acquisition and credit risk assessment.

WEAKNESS

Dependency on Key Relationships

A high level of reliance on key relationships with banks, financial institutions, or investors can pose risks if these partnerships are disrupted or adversely affected by shifts in market dynamics.

Organizational Inertia

A rigid or overly hierarchical organizational structure may reduce agility, limit responsiveness to changing customer needs, and slow down innovation—potentially impacting our competitive edge.

Rising Interest Risk

Exposure to fluctuating interest rates can lead to increased borrowing costs, which may impact both our profitability and the affordability of financial products for clients.

OPPORTUNITIES

Expansion Potential

Significant opportunity exists to strategically expand operations across new geographies and untapped markets, thereby increasing market reach and growing the customer base.

Advertising Strategies

Leveraging aggressive and targeted advertising strategies can boost brand recognition, attract new clients, and reinforce the companys position in a competitive financial services landscape.

Technological Advancements

Adoption of modern technologies—such as fintech platforms, automation, and data analytics-can enhance service delivery, improve operational efficiency, and deepen customer engagement through digital channels.

Rising Demand for MSME Financing

The rapid expansion of Indias MSME sector presents significant opportunities for targeted financial lending and industry-specific solutions.

Expanding Product Portfolio

Introducing innovative financial products will substantially enrich revenue streams and enhance market presence.

THREATS

Competitive Pressure

Increasing competition from traditional banks, fintech startups, and global financial players can erode market share, compress margins, and impact overall profitability

Regulatory Changes

Frequent changes in regulatory policies, compliance requirements, or government guidelines may lead to increased operational complexity and potential constraints on product offerings.

Economic Volatility

Exposure to macroeconomic factors such as interest rate fluctuations, inflation, and global financial instability may affect customer repayment capacity and increase credit risk.

Interest Rate Volatility

A rise in interest rate may result in increased borrowing costs, thereby adversely affecting lending profitability and the overall cost structure.

> INTERNAL CONTROL SYSTEM AND ITS ADEQUACY

Your Company firmly believes that a robust and well-integrated internal control framework is fundamental to the efficient functioning and long-term sustainability of the Company. Our internal control mechanisms are structured to align with our scale of operations, ensuring an appropriate balance between risk management and operational efficiency.

We have instituted a comprehensive internal control system that encompasses financial reporting, operational controls, fraud prevention, regulatory compliance, and adherence to corporate governance standards. These systems are designed to ensure integrity, transparency, and accountability across all levels of the organization.

> Our internal control environment is underpinned by:

• Clearly defined organizational roles, responsibilities, and reporting lines;

• Stringent policies and standard operating procedures across business functions;

• A well-documented delegation of authority matrix and system-based controls;

• Automation and digitization of key processes to minimize manual intervention and associated risks;

• Periodic testing and validation of controls to ensure alignment with industry best practices and evolving regulatory frameworks.

> In addition, the internal control system is enhanced by:

• Regular internal audits conducted by an independent internal auditor, M/s. AHSP & Co. LLP, Chartered Accountants;

• Ongoing process reviews and risk assessments performed by management;

• Quarterly reporting of audit findings and control effectiveness to the Audit Committee of the Board;

• Continuous monitoring and real-time oversight mechanisms for high-risk and sensitive transactions;

• Timely remedial actions based on internal audit observations and control deficiencies.

The Internal Auditor, M/s. AHSP & Co. LLP, has certified that the Company maintains an adequate and effective system of internal financial controls. Their assessment confirms that controls are operating satisfactorily and meet the statutory requirements as laid down under the Companies Act, 2013.

The Audit Committee periodically reviews the adequacy of internal control systems and ensures the implementation of necessary enhancements. This process is central to fostering trust among stakeholders and upholding the Companys commitment to excellence in governance.

"The Board of Directors reaffirms its commitment to upholding a robust internal control framework that aligns with strategic objectives, reinforces risk management practices, and maximizes shareholder value."

> FINANCIAL PERFOMNACE

The summary of Audited (Consolidated and Standalone) financial performance of the Company, for the financial year ended March 31, 2025 is summarized as under:

(Rs. in Lakh, Except EPS)

PARTICULARS	STANDALONE		CONSOLIDATED
	2024-2025	2023-2024	2024-2025	2023-2024
Revenue from Operations	1331.09	1173.23	1331.09	1173.23
Other operating Income	-18.27	222.72	-18.27	222.72
Total Revenue	1312.82	1395.95	1312.82	1395.95
Less: Total Expenditure	624.62	669.97	624.62	669.97
Profit before Tax	688.20	725.98	688.20	725.98
Less: Current Tax Expenses	217.92	153.15	217.92	153.15
Less: Deferred Tax	-23.66	58.26	-23.66	58.26
Less: Tax of earlier years	-15.91	-0.05	-15.91	-0.05
Profit for the year	509.85	514.62	509.85	514.62
Earnings Per Share (EPS)* - Basic	0.88	0.95	0.88	0.95
Earnings Per Share (EPS)* - Diluted	0.86	0.95	0.86	0.95

During the year under review, your Companys total revenue from operations on consolidated basis has been increased to Rs. 1,331.09 lakh as compared to Rs. 1,173.23 lakh in the previous financial year. The net profit changed to Rs. 509.85 lakh as compared to Rs. 514.62 lakh in the previous financial year.

During the year under review, your Companys total revenue from operations on standalone basis has been increased to Rs. 1331.09 lakh as compared to Rs. 1,173.23 lakh in the previous financial year. The net profit changed to Rs. 509.85 lakh as compared to Rs. 514.62 lakh in the previous financial year.

"The management remains focused on enhancing the companys revenue by actively identifying and pursuing new lending and investment opportunities, expanding product offerings, deepening customer reach particularly in underserved segments and leveraging technology to drive operational efficiency and sustainable growth."

> HUMAN RESOURCES (HR)

Your Company recognize that our people are our most valuable asset and the cornerstone of our sustained success. As a financial services provider operating in a dynamic and evolving business environment, we continuously invest in our human capital to build a future-ready workforce. As of March 31, 2025, the Company has the total strength of 11 employees, each contributing uniquely to the Companys growth and operational excellence.

We believe in fostering a collaborative, agile, and performance-driven culture, where individuals are empowered to innovate, take ownership, and drive results. Over the years, the Company has consistently evolved its human resource practices to align with emerging workplace trends and the aspirations of a diverse workforce.

We maintains a cordial and harmonious relationship with its employees, with open channels of communication and a high level of mutual respect and trust. Our policies are designed to promote employee well-being, continuous learning, and career development, creating an enabling environment where people can thrive both professionally and personally.

The Nomination and Remuneration Committee (NRC) plays an instrumental role in reviewing and guiding the career growth plans of senior management. The NRC places significant emphasis on identifying leadership potential,

developing internal talent pipelines, and nurturing high-performing individuals who can lead the Company into its next phase of strategic expansion.

s Alignment with Strategic Objectives:

HR policies and initiatives are designed to support the Companys broader strategic goals, ensuring the workforce contributes effectively to business growth and operational excellence.

s Employee Engagement and Development:

A people-centric approach is adopted to promote a positive work culture, enhance employee satisfaction, and foster long-term retention.

s Training and Capacity Building:

Regular training programs, workshops, and skill development initiatives are conducted to equip employees with industry-relevant knowledge and improve performance standards.

s Recruitment and Talent Acquisition:

The Company emphasizes attracting skilled and competent professionals through a transparent and merit-based recruitment process, ensuring alignment with organizational needs.

s Performance Management and Rewarding Excellence:

A structured appraisal system is in place to recognize and reward high performers, encouraging a culture of accountability and excellence.

s Value Creation and Business Success:

Human resources are recognized as a key driver of value creation, with HR strategies directly contributing to the Companys overall productivity, competitiveness, and longterm success.

The Company is committed to being an equal opportunity employer, ensuring non-discrimination in all its practices regardless of gender, religion, ethnicity, or background. We are proud to uphold a diverse and inclusive work environment where every employee is respected and valued.

> RISKS & CONCERNS

Risk is an inherent aspect of any business, particularly in the financial services sector, where decision-making often involves a fine balance between risk and reward. Your Company recognize that effective risk management is critical to ensuring sustainable growth, protecting stakeholder interests, and maintaining business resilience. The Company is exposed to a broad spectrum of risks including credit risk, interest rate risk, liquidity risk, economic and geopolitical risks, technology and cybersecurity risks, and unforeseen disruptions such as pandemics. These risks

arise from both internal and external factors and can impact various facets of the organization, including products, geographies, asset classes, customer segments, and operational functions.

To address these challenges, the Company has instituted a comprehensive Risk Management Framework that encompasses:

• Risk Identification: Systematic recognition of potential internal and external risks that could affect the achievement of business objectives;

• Risk Assessment: Evaluating the probability and potential impact of identified risks;

• Risk Mitigation: Developing strategic and operational measures to minimize the likelihood or consequences of risks;

• Monitoring & Reporting: Continuously measuring the effectiveness of implemented controls and safeguards, and updating them in response to changes in the business or regulatory environment.

Our risk management framework is not a one-time exercise but an ongoing and dynamic process that is fully integrated into the Companys operational and strategic planning. It enables proactive identification and timely mitigation of emerging risks, while also ensuring compliance with applicable regulatory standards.

Key features of our risk governance structure include:

s A Board-approved Risk Management Policy, with clearly defined roles and responsibilities;

s Regular review of risk exposures and mitigation strategies by the Audit Committee and Risk Management Committee;

s Scenario analysis and stress testing to assess resilience under adverse conditions;

s Integration of technology to enhance risk detection, control monitoring, and data-driven decision-making; s a strong internal control system that complements the overall risk management process.

We also acknowledge that certain risks are unavoidable and are an intrinsic part of operating in a complex, interconnected financial environment. In such cases, our approach is to build adequate buffers, ensure operational flexibility, and enhance our preparedness to respond swiftly and effectively.

We remains committed to continuously strengthening its risk management capabilities, aligning them with global best practices, and fostering a risk-aware culture across all levels of the organization.

A. Market Risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risk: interest rate risk, currency risk and other price risk. Financial instruments affected by market risk include loans and borrowings and deposits.

• Interest Rate Risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. This risk exists mainly on account of borrowings of the Company. However, all these borrowings are at fixed interest rate and hence the exposure to change in interest rate is insignificant.

• Foreign Currency Risk

Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates. The Company is not exposed to significant foreign currency risk as at the respective reporting dates.

• Price Risk

The Company is mainly exposed to the price risk due to its investment in debt mutual funds. The price risk arises due to uncertainties about the future market values of these investments.

B. Credit Risk

Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The Company is exposed to credit risk from its operating activities (primarily trade receivables) and other financial assets.

• Trade Receivables

Customer credit risk is managed by each business unit subject to the Companys established policy, procedures and control relating to customer credit risk management. An impairment analysis is performed at each reporting date on an individual basis for major trade receivables.

• Other Financial Assets

Credit risk from balances with banks and financial institutions is managed by the Company in accordance with the Companys policy. Investments of surplus funds are made only in highly marketable debt instruments with appropriate maturities to optimise the cash return on instruments while ensuring sufficient liquidity to meet its liabilities.

C. Excessive risk concentration

Concentrations arise when a number of counterparties are engaged in similar business activities, or activities in the same geographical region, or have economic features that would cause their ability to meet contractual obligations to be similarly affected by changes in economic, political or other conditions. Concentrations indicate the relative sensitivity of the Companys performance to developments affecting a particular industry.

In order to avoid excessive concentrations of risk, the Companys policies and procedures include specific guidelines to focus on the maintenance of a diversified portfolio. Identified concentrations of credit risks are controlled and managed accordingly.

D. Liquidity risk

Liquidity risk is the risk that the Company will face in meeting its obligations associated with its financial liabilities. The Companys approach in managing liquidity is to ensure that it will have sufficient funds to meet its liabilities when due without incurring unacceptable losses.

The company maintained a positive cash balance during Financial Year 2024 and Financial Year 2025 by adopting a prudent cash management approach. Operating cash flows sufficiently covered daily obligations, while rolling forecasts ensured liquidity for ongoing needs. Surplus funds were held as cash equivalents or invested in low-risk, interest-bearing instruments and debt mutual funds to optimize returns while preserving liquidity. The company actively monitored the maturity profiles of its financial assets and liabilities to maintain funding stability and financial flexibility.

OTHER RISKS

In addition to Market Risk, Credit Risk, Liquidity Risk, and Concentration Risk, NBFCs are exposed to several other types of risks that are crucial to monitor and manage. Here are some key additional risks relevant to NBFCs:

E. Operational Risk

Operational risk arises from inadequate or failed internal processes, people, systems, or external events. This includes: Fraud or misconduct by employees or clients System failures or cyber-attacks Compliance breaches or human errors Outsourcing and third-party dependency risks.

F. Regulatory and Compliance Risk

This is the risk of legal or regulatory sanctions, financial loss, or reputational damage due to failure to comply with applicable laws, regulations, or codes of conduct.

G. Reputation Risk

Reputation risk refers to the potential loss in business or brand value due to negative public perception, poor customer service, regulatory penalties, or adverse media coverage.

H. Strategic Risk

Strategic risk arises from adverse business decisions, improper implementation of strategies, or lack of responsiveness to industry changes.

I. Technology and Cyber-security Risk

As NBFCs increasingly adopt digital platforms, risks associated with cyber-security threats, data breaches, and system vulnerabilities have grown.

J. Capital Risk

This involves the risk of insufficient capital to absorb unexpected losses. NBFCs must maintain adequate capital adequacy ratios as per RBI norms to remain solvent during downturns or stress periods.

K. Funding Risk

This refers to the risk related to the NBFCs ability to raise timely and cost-effective funding. Dependence on a narrow set of funding sources (like banks or capital markets) may expose it to refinancing risks or higher interest costs.

> FUTURE OUTLOOK

The Non-Banking Financial Company (NBFC) landscape in India is undergoing a transformative phase, shaped by evolving regulatory frameworks, heightened compliance expectations, and a shifting macroeconomic environment. In this context, Your Company enters Financial Year 2024-25 with a clear strategic vision and a cautiously optimistic outlook.

The Company is focused on enhancing its governance standards, strengthening its risk management architecture, and fostering a culture of agility to respond to market shifts. With steady improvement in domestic consumption and renewed momentum in key lending segments such as micro, small, and medium enterprises (MSMEs), personal finance, and affordable housing, we aims to capitalize on emerging credit demand.

Digital innovation will remain central to our growth agenda. By embracing new-age technologies, we plan to streamline operations, enhance customer experiences, and expand our digital reach, particularly in underserved and semi-urban regions.

Backed by a prudent approach to capital allocation, a customer-centric mindset, and a strong operational foundation, the Company is well-equipped to navigate uncertainties and unlock new opportunities. We are committed to delivering sustainable growth while maintaining regulatory alignment and financial discipline.

> DISCLOSURE OF ACCOUNTING TREATMENT

The Company has complied the prescribed accounting treatment while preparation of financial statements as per Accounting Standard, thus no disclosure is required to be made thereunder.

> CAUTIONARY STATEMENT

Certain statements made in the this Report relating to the Companys objectives, projections, outlook, expectations, estimates and others may constitute forward looking statements, within the meaning of applicable laws and regulations. Actual results may differ from such expectations, whether expressed or implied. Several factors could make a significant difference to the Companys operations. These include climatic and economic conditions affecting demand and supply, government regulations and taxation, any epidemic or pandemic, natural calamities over which the Company may not have any direct/indirect control.

The management of the Company has used estimates and judgments relating to the financial statements on a prudent and reasonable basis, in order that the financial statements reflect a true and fair manner, the state of affairs and profit / loss for the year. The narrative on our financial condition and result of operations should be read together with the notes to the financial statements included in the annual report. Important factors that could make a difference to the Companys operations include changes in Government regulations and tax regime, economic developments within India and abroad, financial markets, etc.