Dharani Finance Ltd Directors Report

Dear Members,

The Board of Directors present herein the 35^th Annual Report of the Company together with the Audited Accounts for the year ended 31^st March 2025.

FINANCIAL SUMMARY

The Financial results for the year ended 31^st March 2025 are briefly as follows:

Rs.in Lakhs

Particulars	For the year Ended 31.03.2025	For the year Ended 31.03.2024
Income through Travel Operations, Finance Services and others	142.43	79.28
Expenditure (Employee & Administrative Expenses)	46.32	98.07
Profit / (Loss)	96.08	(18.79)
Depreciation	9.92	9.92
Interest & Bank Charges	1.62	1.69
Profit/(Loss) after depreciation & Interest	84.54	(30.40)
Provision for Income Tax
Current	17.85
Deferred	17.10
Profit/(Loss) after Tax	83.79	(30.40)
Surplus brought forward
Profit available for appropriation	448.64	363.39
APPROPRIATIONS
Transfer to Statutory Reserves
Proposed Dividend
Dividend Distribution Tax
Net Surplus carried over	448.64	363.39

PERFORMANCE

The total revenue was Rs. 142.43 lakhs as against Rs.79.28 lakhs in the previous year. The income for this year consists mainly of interest on loans and vehicles on lease. Besides interest, the Company also received a sum of Rs. 50.28 lakhs as lease charges for the vehicles given on lease. The profit comes to Rs. 83.79 lakhs as against the loss of Rs.30.40 lakhs in the previous year.

OUTLOOK

Your company is also exploring the possibility of increasing its resources by additional capital or borrowings though it has not been able to does during 202425. In addition, your Company proposes to increase its financial services activities in the coming years.

RESERVES

Your Board Directors has not recommended transferring any amount to General Reserve Account during the year.

DIVIDEND & DIVIDEND DISTRIBUTION POLICY:

During the year under review to conserve the cash, your Board of Directors has not recommended any dividend. The Board has decided to retain all earnings for the current period and such retained earnings will be used to fund future investments and support the companys continued growth.

Pursuant to Regulation 43A of LODR Regulation 2015, the regulations related to Dividend Distribution Policy are not applicable to the Company.

SHARE CAPITAL

There is no change in the Share Capital of the Company either the Authorized Capital or the issued Capital. The Paidup equity capital as on March 31, 2025 continues to remain at Rs.4,99,44,000.00. During the year under review, the company has not issued shares with differential voting rights nor granted stock options or sweat equity or bonus shares. The Company has not bought back any of its securities during the year under review.

ANNUALRETURN

The Form MGT 7 for the year 202425 shall be filed with Registrar of Companies within the prescribed time after the date of 35^th Annual General Meeting (AGM) of your Company. This also available in web address of the Company i.e., www.dharanifinance.com .

BOARD MEETINGS

1. Board presently consists six directors including one Woman Director.

2. During the year 202425 FOUR Board Meetings were held on 17.05.2024, 09.08.2024, 11.11.2024 and 11.02.2025. Attendance at these meeting is given below.

Name of the Director	Category of Directorship	No of Board Meetings Attended
Dr Palani Gounder Periasamy (DIN 00081002)	Chairman (NonExecutive) Promoter	4
Mrs Visalakshi Periasamy (DIN 00064517)	NonExecutive Promoter	3
Mr K Kandasamy (DIN 00277906)	NonExecutive Promoter	4
Mr Palaniappan Rajamanickam Shampath, IAS (Retd) (DIN10461017) Appointed w.e.f. 09.08.2024	Independent Director	2
Mr Perianna Gounder Muthusamy, IRS (Retd) (DIN09048245) Appointed w.e.f.09.08.2024	Independent Director	2
Mr Murugavel Ramasamy, (DIN10693633) Appointed w.e.f.09.08.2024	Managing Director	2
Mr M Ganapathy (DIN00234337) Tenure completed on 24.09.2024	Independent Director	2
Dr S Muthu (DIN03331664) Tenure completed on 24.09.2024	Independent Director	2

NOMINATION AND REMUNERATION COMMITTEE

As required by Section 178 of the Companies Act, 2013 a Nomination & Remuneration Committee has been set up.

Mr Perianna Gounder Muthusamy, IRS (Retd), Mr Palaniappan Rajamanickam Shampath, IAS (Retd) and Mrs Visalakshi Periasamy.

Mr Perianna Gounder Muthusamy, IRS (Retd) is the Chairman of the Committee.

The Committee has formulated appropriate criteria for appointment of Directors and their remuneration.

The Board has, on the recommendation of the Nomination & Remuneration Committee framed a policy for selection and appointment of Directors, Senior Management and their remuneration. The Remuneration Policy is available in Website. Two Meetings are held during 202425. The Committee met on 17.05.2024 and 09.08.2024.

AUDIT COMMITTEE

A qualified Audit Committee is in position consisting of the following directors.

Mr Perianna Gounder Muthusamy, IRS (Retd), Mr Palaniappan Rajamanickam Shampath, IAS (Retd) and Mr Murugavel Ramasamy. Mr Perianna Gounder Muthusamy, IRS (Retd) is the Chairman of the Committee.

The Audit Committee met 4 times on 17.05.2024, 09.08.2024, 11.11.2024 and 11.02.2025. There was no instance where the recommendation of the Audit Committee was not accepted by the Board.

Name of the Director	Category of Directorship	No of Meetings Attended
Mrs Visalakshi Periasamy	Non Executive Promoter	2
Mr Palaniappan Rajamanickam Shampath, IAS (Retd)	Independent Director
Mr Perianna Gounder Muthusamy, IRS (Retd)	Independent Director
Mr M Ganapathy	Independent Director	2
Dr S Muthu	Independent Director	2

STAKEHOLDER RELATIONSHIP COMMITTEE

The Stakeholders Relationship Committee is in position to specifically look into shareholders / investors complaints, on transfer of shares, non receipt of balance sheet, non receipt of declared dividend etc., and also the action taken by the Company on those matters. The Committee met on 17.05.2024.

Name of the Director	Category of Directorship	No of Meetings Attended
Mr K Kandasamy	NonExecutive Promoter	2
Mr Palaniappan Rajamanickam Shampath, IAS (Retd)	Independent Director	2
Mr Perianna Gounder Muthusamy, IRS (Retd)	Independent Director	2
Mr Murugavel Ramasamy,	Managing Director	2
Mr M Ganapathy	Independent Director	2
Dr S Muthu	Independent Director	2

The Members of the Stakeholders Relations Committee are Mr Palaniappan Rajamanickam Shampath, IAS (Retd) (Chairman) and Mr Murugavel Ramasamy, Managing Director.

Name of the Director	Category of Directorship	No of Meetings Attended
Mr Palaniappan Rajamanickam Shampath, IAS (Retd)	Independent Director
Mr Murugavel Ramasamy,	Managing Director
Dr S Muthu	Independent Director	1
Mr K Kandasamy	NonExecutive Promoter	1

From 01.04.2019 transfer of shares can be only in demat form and Shareholders have been advised.

MANAGEMENT COMMITTEE

No Management Committee meeting was conducted during this period.

POLICY ON APPOINTMENT OF DIRECTORS AND REMUNERATION

The Companys policy on Directors, Senior Management appointment and remuneration and other matters provided in Section 178 (3) of the Companies Act, 2013, is available on the website of the Company at www.dharanifinance.com

the year under review, confirming that they continue to meet with the criteria of Independence as prescribed under Section 149(6) of the Companies Act, 2013 and Regulation 25 & 16 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and amendments made under thereto. The Independent Directors have also confirmed that they are not on the Board more than three NBFCs (Base Layer, Middle Layer or Upper Layer) at the same time in line with RBI Scale Based Regulations.

LOANS, GUARANTEES OR INVESTMENTS MADE UNDER SECTION 186 OF THE COMPANIES ACT, 2013:

DIRECTORS RESPONSIBILITY STATEMENT

In terms of Section 134 (5) of the Companies Act, 2013, the directors would like to state that:

I) In the preparation of the annual accounts, the applicable accounting standards have been followed.

ii) The directors have selected such accounting policies and applied them consistently and made judgments and estimates that were 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 or loss of the Company for the year under review.

iii) The directors have 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.

iv) The directors have prepared the annual accounts on a going concern basis.

v) 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.

vi) The directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such system was adequate and operating effectively.

The new accounting standards, viz., Ind AS has become applicable to your Company with effect from the year 201920.

DECLARATION BY INDEPENDENT DIRECTORS

The Company has received declarations from all the Independent Directors on the board of the Company for

The details of the Loans, Guarantees or Investments made under Section 186 of the Companies Act, 2013 by the Company, to other Body Corporate or persons are given in notes to the Financial Statements.

CONTRACTS, ARRANGEMENTS WITH RELATED PARTIES REFERRED TO IN SECTION 188(1) OF THE COMPANIES ACT, 2013.

All related party transactions that were entered into during the financial year were in the ordinary course of business and were on arms length basis. The statement in form AOC 2 is attached as Annexure I. There are no materially significant related party transactions entered into by the Company with Promoters, Key Managerial Personnel or other designated persons which may have potential conflict with the interest of the Company at large.

STATUTORY AUDITORS

Pursuant to the provisions of Sections 139 and 141 of the Companies Act, 2013, Mr N Srivatsan, Chartered Accountants, Chennai (Registration No.014921S) were appointed as Statutory Auditors for a period of 5 years in the Annual General Meeting held on 29^th December 2022 to hold office until the conclusion of the 37^th Annual General Meeting of the Company.

AUDITORS REPORT

The observations made in the Auditors Report read together with relevant notes thereon are selfexplanatory and do not call for any further comments under Section 134(3) f of the Companies Act, 2013. Statement on impact of Audit Qualification is given below

The following qualification was mentioned in the Audit Report as of 31^st March 2025 by the Statutory Auditors.

Statement on impact of Audit Qualifications (for Audit Report with modified opinion submitted) along with Audited Financial Results (Standalone and consolidated separately)
Statement on impact of Audit Qualifications for the Audited Financial Results for the year ended 31st March 2025
(See Regulation 33/52 of the SEBI (LODR) (Amendment) Regulation, 2016)
Sl.No		Particulars	Audited Figures (as reported before adjusting for qualifications)	Audited Figures (as reported after adjusting for qualifications)
			(Rs. lakhs)
I	a	Turnover/ Total Income	142.43	142.43
	b	Total Expenditure	57.89	57.89
	c	Net Profit/ (Loss)	84.54	84.54
	d	Earnings Per share	1.68	1.68
	e	Total Assets	1018.78	1018.78
	f	Total Liabilities	70.43	70.43
	g_	Net Worth	948.35	948.35
	h	Any other financial item(s) as felt appropriate by the Management)
II	Audit Qualification (each audit qualification / Disclaimer of Opinion/ Adverse Qualification
	a	Details of Audit Qualifications.	Recovery of amount due from major customer aggregating to INR.272.00 lakhs, which is considered doubtful due to uncertainty in the receipt of fun ds.
	b	Type of Audit Qualifications: Qualified Opinion / Disclaimer of Opinion / Adverse Opinion	Qualified Opinion
	c	Frequency of Qualifications: Whether appeared first time/ repetitive / since how long continu i ng	8th time, Since 31st March 2020.
	d	for Audit Qualification(s) where the impact is quantified by the auditor, Managements views:	Not Quantified
	e	for Audit Qualification(s) where the impact is not quantified by the auditor:
		I. Managements estimation on the impact of audit qualification.	The Management is of the opinion that based on the discussion with the customer that the full repayment of the outstanding receivable from the said Customer is expected to be received.
		ii. Managements is unable to estimate the impact, reasons for the same:	NA
		iii. Auditors comments on (i) or (ii) above;	Statement relating to given InterCorporate Deposit (ICD) of Rs. 200 Lakhs to a customer and accrued interest on loans and advances receivable on the abovementioned loans have been carried at outstanding values of Rs.272 Lakhs. The Management is of the opinion on full repayment of the outstanding receivable from the said Customer. Due to uncertainty on the receipt of funds from the customer till the date of issue of this report, the impact of the above in case provision of outstanding values shall affect the net owned funds of the Company.

SECRETARIAL AUDITOR

Pursuant to the provisions of Section 204 of the Companies Act and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and amended Regulation 24A of the SEBI Listing Regulations, the Board has, based on the recommendation of Audit Committee, approved appointment of M/s. Damodaran & Associates LLP, Practicing Company Secretaries, Chennai, a peer reviewed firm of proposed to be appointed as Secretarial Auditors of the Company for a period of five years i.e., from April 1,2025 to March 31, 2030, subject to approval of the Shareholders of the Company at the 35th AGM of the Company.

M/s. M Damodaran & Associates LLP, Chennai (Mem.No.5837 and COP.No.5081) Practising Company Secretaries are the Secretarial Auditors of the Company for the year 202425 the report received from Ms.

Kalaiyarasi Janakiraman, Partner, M/s. M Damodaran & Associates LLP is attached with this report in Form No. MR3 under Annexure II. For the current financial year, we have not received any qualification, reservation or adverse remark or disclaimer in the Audit Report.

INTERNAL AUDITOR

Pursuant to Section 138 of the Companies Act, 2013 read with Rule 13 of the Companies (Accounts) Rules, 2014 and all other applicable provisions (including any amendment thereof) if any of the Companies Act, 2013, M/s. R Balachandran & Co., Chartered Accountants, (Firm Registration No. .000323S ) were appointed as the Internal Auditors of the company for the Financial Year 202425.

COST AUDITOR AND MAINTENANCE OF COST ACCOUNTSAND RECORDS

During the year under review, provision of Section 148 of Companies Act, 2013 is not applicable to the Company.

The Company does not fall under the category of Section 148(1) of Companies Act, 2013 and hence such disclosure and maintenance of cost accounts/ cost records is not applicable.

COMPLIANCE WITH SECRETARIAL STANDARDS

During the year under review, the provisions of Secretarial Standard 1 (Board Meetings) and 2 (General Meetings) issued by the Institute of Company Secretaries of India (ICSI) were adhered to while conducting the respective Meetings.

MATERIAL CHANGES AND COMMITMENTS

There are no material changes and commitments, affecting the financial position of the Company which have occurred between the end of the financial year of the Company to which the financial statements relate and the date of the report.

FOREIGN EXCHANGE EARNINGS AND OUTGO, CONSERVATION OF ENERGY & TECHNOLOGY ABSORPTION

A. During the year there were no Foreign Exchange Earnings & Outflow.

B. Conservation of Energy & Technology absorption.

These guidelines are not applicable to this Company.

PARTICULARS OF EMPLOYEES

In accordance with the provisions of Section197 (12) of the Companies Act,2013, read with Rules 5(1),5(2) and 5(3), of the Companies (Appointment and Remuneration of Managerial personnel) Rules, 2014, the name and other particulars of employees are to be set out in the “Annexure III forming part of the Annual Report.

Your Company does not have any Subsidiary/ or any Associate Company / Joint Ventures

RISK MANAGEMENT POLICY

The Company has developed a risk management policy. Pursuant to Section 134 (3) (n) of the Companies Act, 2013 details of the Policy are disclosed in the Companys Website.

At present the Company has not identified any element of risk which may threaten the existence of the Company. In this context, report against heading Material Changes of Commitments given above may be referred to.

DIRECTORS AND KEY MANAGERIAL PERSONNEL A. Directors Appointment/Reappointment

Dr Palani Gounder Periasamy, (DIN No.00081002) Director of the Company retires by rotation at the ensuing 35^th Annual General Meeting (”AGM”) of the Company and being eligible, offers himself for reappointment at the ensuing AGM.

Mrs Visalakshi Periasamy (DIN No.00064517) Director of the Company retired on rotation in the 34^th Annual General Meeting held on 26^th September 2024 and Reappointed at the same meeting with the approval of members.

Mr Palaniappan Rajamanickam Shampath (IAS) (R) (DIN: 10461017) was appointed as an Independent Director by Board on 9^th August 2024 and approved by members of the Company in 34^th Annual General Meeting held on 26^th September 2024.

Mr Perianna Gounder Muthusamy (DIN: 09048245) was appointed as an Independent Director by Board on 9^th August 2024 and approved by members of the Company in 34^th Annual General Meeting held on 26^th September 2024.

Mr Murugavel Ramasasmy (DIN:10693633 was appointed as a Managing Director by Board on 9^th August 2024 and approved by members of the Company in 34^th Annual General Meeting held on 26^th September 2024.

Mr Kandasamy Kolanda Gounder (DIN: 00277906) ceased to be a Managing Director of the Company at the close of the business hours on 24.06.2024, upon completion of his term of five (5) years and he continuing as Director.

Dr Muthu Sakkarakali Gounder (DIN No.03331664), Independent Director his 2^nd term tenure was completed on 24.09.2024.

Mr Ganapathy Gounder Muthusamy (DIN No.00234337) Independent Director his 2^nd term tenure was completed on 24.09.2024.

B. Key Managerial Personnel

In terms of Section 203 of the Act, the Key Managerial Personnel (KMPs) of the Company during 202425 are:

Mr N Sivabalan, Chief Financial Officer

Mrs Saloni Jain, Company Secretary and Compliance Officer

During the year under review, there were no change in the KMPs of the Company.

SIGNIFICANT AND MATERIAL ORDERS

There were no significant and material orders passed by the Regulators or Courts or Tribunals impacting the going concern status and Companys operations in future.

DETAILS IN RESPECT OF FRAUDS REPORTED BY AUDITORS OTHER THAN THOSE WHICH ARE REPORTABLE TO THE CENTRAL GOVERNMENT

During the year under review, the Statutory Auditors of the Company have not reported any frauds to the Audit Committee or to the Board of Directors as prescribed under Section 143(12) of the Companies Act, 2013 and rules made thereunder.

INTERNAL FINANCIAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. The scope and authority of the Internal Audit function is defined in the assignment order. To maintain its objectivity and independence, the Internal Auditor reports to the Chairman of the Audit Committee of the Board & to the Chairman of the Board. The Internal Audit monitors and evaluates the efficacy and adequacy of internal control system in the Company, its compliance with operating systems, accounting procedures and policies. Based on the report of internal auditor, management undertakes corrective action and thereby strengthen the controls. Significant audit observations wherever made and recommendations along with corrective actions thereon are presented to the Audit Committee of the Board.

DEPOSITS

The Company does not hold any public deposits as on 31^st March 2025. Your Company has not accepted any deposits covered under Chapter V of the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014.

The Company has stopped collecting public deposits and had got its License amended by Reserve Bank of India to indicate that it is a nondeposit taking NBFC. Your Company does not propose to collect public deposits in the coming year.

CORPORATE SOCIAL RESPONSIBILITY INITIATIVES

Your Company does not fall within the parameters as per Section 135 of the Companies Act and hence not mandated to formulate a Corporate Social Responsibility Policy or spend the prescribed amounts.

BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013, the Board has carried out an evaluation of its own performance, the directors individually as well as the evaluation of the working of its Audit, Nomination & Remuneration Committees. The manner in which the evaluation is carried out is based on criteria approved by the Board which is available on the Companys Website.

VIGIL MECHANISM FOR DIRECTORS & EMPLOYEES

A competent Vigil mechanism has been established and a whistle blower policy has been designed to help Directors and Employees to report genuine concerns. The complete mechanism is given in the companys website.

CORPORATE GOVERNANCE

This requirement is not applicable to this Company at present, as per Regulation 15(2) of the SEBI (Listing Obligations and Disclosure Requirements), as its paid up capital is less than Rs. 10 crores and Net worth less than Rs.25 crores.

PREVENTION OF SEXUAL HARASSMENT AT WORK PLACE

The Company has in place an AntiSexual harassment policy in line with the requirements of Section 4 of the Sexual harassment of Women at Work Place (Prevention, Prohibition & Redressal) Act, 2013. Internal Complaints Committee (ICC) has been set up to redress complaints received as sexual harassment. All employees are covered under this policy. Details have been displayed prominently in the work place and also in the Companys Website.

No complaints were received during the year 202425. CODE OF CONDUCT

The Board of Directors has approved a Code of Conduct which is applicable to the Members of the Board and all employees in the course of day to day business operations of the Company.

The Code has been posted on the Companys website: www.dharanifinance.com

UNCLAIMED DIVIDEND

The Provisions of Section 125(2) of the Companies Act, 2013 do not apply as there was no dividend declared and paid last year.

Pursuant to Section 124 & 125 of the Companies Act,2013 dividend remaining unpaid or unclaimed for a period of 7 years were transferred to the Investor Education and Protection Fund of the Central Government.

Shareholders may claim their unclaimed dividend for the years prior to and including the financial year 201112 and the corresponding shares, from the IEPF Authority by applying in the prescribed Form No. IEPF5. This form can be downloaded from the website of the IEPF Authority www.iepf.gov.in.

OTHER DISCLOSURES

There are no proceedings pending under the Insolvency and Bankruptcy Code, 2016.

There was no instance of onetime settlement with any Bank or Financial Institution.

There has been no change in the nature of business of the Company.

Your Directors also thank the Registrar & Transfer Agent and shareholders who have continued to repose their confidence in the Company and its management.

For and on behalf of the Board of Directors For Dharani Finance Limited

The provision of Maternity Benefit Act 1961 is not applicable to the Company for the financial year 202425.

ACKNOWLEDGEMENTS

Your Directors place on record their appreciation of the services rendered by the Staff and Executives of your Company.

Dr PALANI GOUNDER PERIASAMY CHAIRMAN

(DIN 00081002)

PLACE: CHENNAI DATE: 26” May 2025