Ind Bank Housing Ltd Management Discussions

1. Industry Structure and Developments

During the financial year 2025-26, the Companys primary operational focus remained on the management and recovery of its existing loan portfolio. Recovery efforts were carried out through various permissible mechanisms, including negotiated settlements, legal proceedings and other recovery initiatives, with the objective of optimizing recoveries and strengthening the Companys financial position. The Company is no longer undertaking housing finance or lending activities pursuant to the cancellation of its Certificate of Registration by the Reserve Bank of India in September 2023, However, the order has permitted the Company to recover all its outstanding dues. Accordingly, the discussion in this Report primarily relates to the Companys recovery operations, financial performance, risks and future outlook.

2. Opportunities and Threats

Opportunities

The Company continues to explore opportunities for maximizing recoveries from its existing loan portfolio through negotiated One Time Settlement (OTS) arrangements, legal proceedings and other recovery mechanisms, wherever considered appropriate. Resolution of long-pending litigation and timely realization of outstanding dues are expected to improve cash flows.

Threats

The Companys recovery operations are subject to certain risks and challenges, including delays in legal and judicial proceedings that may impact the timing of recoveries, uncertainties associated with the realization of dues from certain loan accounts, and external economic factors that may influence borrowers repayment capacity and the value of underlying securities.

3. Segment-wise or Product-wise Performance

The Company does not have any separate reportable business segments or product categories. During the financial year, the

Company continued to focus on the recovery and realization of its existing outstanding dues.

4. Business and Recovery Outlook:

The Company had suspended fresh lending business since 2000 and had been engaged in recovery of loans outstanding. The companys net loss for the FY 2025-26 is Rs. 8.84 lakhs. During the FY 2025-26, the Company has recovered Rs. 7.45 Lakhs from Individual Loan accounts. The Company has entered into an OTS for the Account of M/s. New Era Urban Amenities Limited for Rs. 110 Crs. This OTS is yet to be accepted by the Mortgagor. The Company also continued to monitor and pursue pending legal matters relating to recovery of dues and realization of secured assets.

5. Risk Management and Internal Control Systems

The Company continues to manage credit, liquidity, operational and compliance risks associated with its recovery operations. Recovery of the existing loan is closely monitored through continuous follow-up, negotiated settlements and legal proceedings, wherever necessary. The Company also maintains adequate liquidity to meet its operational and statutory obligations. Well-defined policies, internal controls and periodic reviews help ensure effective risk management and compliance with applicable laws and regulations.

6. Human Resources

Human resources of your company consisted of one Company Secretary and another deputed officer (CFO) from the parent

organization. The employees are qualified and experienced in their respective field of operations.

7. Financial Performance :

(Rs. in Lakhs)

Particulars	2025-26	2024-25
Gross Income	50.97	27.65
Expenses
Employees benefit	29.22	30.66
Depreciation	0.03	0.09
Other expenses	30.55	27.61
Total expenses	59.80	58.36
Net Profit Before Tax	(8.83)	(30.71)
Provision for Tax	0.00	0.00
Other Comprehensive Income	(0.01)	0.00
Net Profit / Loss After Tax	(8.84)	(30.71)
Loss brought forward	(13670.59)	(13639.88)
Balance Loss Carried to Balance Sheet	(13679.43)	(13670.59)

Balance Sheet and Profit /Loss Statement:

i) Share Capital:

The Equity of your company comprises one Crore equity shares of Rs.10 each. Your companys shares are listed with the Bombay Stock Exchange Ltd. There is no change in share capital of the company during the year.

ii) Reserves & Surplus

No amount has been transferred to the Reserves & surplus for the financial year 2025-26.

iii) Financial Liabilities a. Borrowings - Borrowings comprise of term loan borrowed from Indian Bank. The Loan is obtained from Indian Bank at market rate of interest. As per agreement entered into with Indian Bank no interest was charged since 01.04.2017 and the

debt is freezed to Rs.12900.00 lakhs. with respect to the loan mentioned, the company has paid Rs. 2 crs Indian Bank on

13t July 2026 and present outstanding is Rs. 127 crs.

b. Other Financial Liabilities Other Financial Liabilities comprise of amount received under the auction sale held under the provisions of SARFAESI Act and Amount received from various branches during merger of branches and Overdue deposit. Your company had stopped accepting fresh deposits from public since 1998 and renewal of the deposits from 01.11.2001. Your company has repaid all the matured deposits except a sum of Rs. 6.33 lakhs as on 31.03.2026, which represent the deposits matured but withheld by Central Bureau of Investigation, Anti-corruption Branch, Madurai pending disposal of their case.

iv) Non-Financial liabilities

a) Provisions The provision for the financial year 2025 26 increased to Rs. 12.72 lakhs as compared to Rs. 1.68 lakhs in the previous financial year 2024 25, due to the professional fees billed by the Panel Advocate, M/s. Ramasubramaniam & Associates, in connection with the legal case relating to M/s. New Era Urban Amenities Limited.

b) Other Non-financial liabilities The other non-financial liabilities for the financial year 2025 26 increased to Rs. 1,100.36 lakhs as compared to Rs. 0.47 lakhs in the previous financial year. In connection with the NPA account of M/s. New Era Urban Amenities Limited, secured by an underlying asset comprising 24.765 acres of land at Semmencherry, the matter has been under litigation, with legal proceedings continuing since 1998. During the current financial year, a One Time Settlement (OTS) in respect of the said account was approved, and the mortgagor has remitted the 10% upfront amount as stipulated under the OTS. Consequently, the increase in Other Non-Financial Liabilities is attributable to the receipt of the said upfront amount. Since the OTS has not yet been accepted by the mortgagor, the upfront amount of Rs. 1,100 lakhs has been retained in a no-lien fixed deposit account as a restricted balance and is not available for use by the Company.

v) Financial Assets:

Financial Assets comprise cash and bank balances, investments, loans, and other financial assets. The other bank balance includes Rs.1,100 lakhs received as the upfront amount under the One-Time Settlement (OTS), which has been retained in a no-lien fixed deposit account as a restricted balance and is therefore not available for use by the Company. Hence the cash and cash equivalent available for the company to use is Rs. 368.65 lakhs. The entire loan portfolio, both secured and unsecured, has been fully provided in the books. The increase in investments is attributable to the appreciation in the market value of the Companys investment in the equity shares of M/s. Rajasthan Petro Synthetics Ltd and in Tamil Nadu SDL Bonds. On 28th April 2026, the company has received an income tax refund for the FY 1999-2000 for Rs. 8.79 crs.

vi) Non-Financial Assets

Non-Financial Assets comprise current tax assets, property, plant and equipment, and other intangible assets. Current tax assets represent tax deducted at source (TDS)/advance tax, net of tax provisions and also comprises of the balances with Government authorities (GST). Property, plant and equipment consist of furniture, office equipment and computers. During the year, no additions were made to the property, plant and equipment. There are no intangible assets held by the company as on 31.03.2026.

vii) Statement of Profit and Loss

During the year the company incurred a loss of Rs. 8.84 lakhs. After adjusting the loss with the accumulated losses carried over the same at the end of the 31.03.2026 stood at Rs. 13679.43 lakhs as against Rs. 13,670.59 lakhs for the previous year.

viii) Income

The Company did not generate any income from operations during the financial year. Other income for the year 2025 26 stood at Rs. 50.97 lakhs as compared to Rs. 27.65 lakhs in the previous year. The increase was primarily due to higher interest income earned on fixed deposits with banks. ix) Expenses

Employee benefit expenses decreased to Rs. 29.22 lakhs during the financial year 2025 26 from Rs. 30.66 lakhs in the previous year. Administrative and other expenses increased to Rs. 30.55 lakhs from Rs. 27.61 lakhs in 2024 25. Depreciation charged during the year amounted to Rs. 0.03 lakhs as compared to Rs. 0.09 lakhs in the previous year.

Managements Reply to the Provisional and Additional Provisional Comments raised by the Comptroller & Auditor General of

India under Section 143(6)(b) of the Companies Act, 2013 on the Financial Statements for the year ended 31 March 2026

The following are the Managements replies to the comments raised by the Comptroller and Auditor General of India (C&AG).

However, the C&AG, vide its Certificate dated 24.07.2026, has retained the following two comments.

1. Statement of Cash Flows as on 31.03.2026

O The observation is noted and accepted.

O Since the financial statements, including the Balance Sheet, Statement of Profit and Loss, and Statement of Cash Flows for FY 2025-26, have already been approved and adopted by the Board of Directors, no revision is proposed at this stage.

However, the Company shall include an appropriate disclosure regarding the aforesaid fixed deposits in the Management Discussion and Analysis Report forming part of the Annual Report for FY 2025-26 and also wound change the policy accordingly.

O Further, the Company assures that the requisite disclosure under Paragraph 48 of Ind AS 7 shall be appropriately incorporated in the Statement of Cash Flows and related notes in future financial statements.

O The specific query regarding the treatment of Other Bank Balances as Cash and Cash Equivalents in the Statement of Cash Flows, we submit that in the Balance Sheet, the Rs.11 crore OTS upfront amount received from M/s New Era Urban

Amenities Limited has been rightly disclosed under Other Bank Balances.

O However, in the Statement of Cash Flows, the same was inadvertently included under Cash and Cash Equivalents instead of being shown under Other Bank Balances. (Additional Provisional Comment- reply).

O This error is acknowledged and we confirm that the same will be rectified in the ensuing financial statements.

2. Other Bank Balances (Note 2): Rs.14.62 Crore

O Separate disclosure of the amount Rs. 11 crore received is made under “Other Non- Financial Liability”. But the disclosure under the cash-flow was not made. However, we accept the observation that the specific restrictive nature of this balance

has not been explicitly disclosed in the notes to the financial statements. This will be separately and appropriately disclosed

in the notes to accounts in the ensuing financial statements. The requisite disclosure has already been incorporated under

“Other Bank Balances” in the financial statements for the period ended 30 June 2026.

Significant Changes in Key financial ratios:

Details of significant changes (i.e. change of 25% or more as compared to the immediately previous financial year) in key

financial ratios, along with detailed explanations therefore, including:

Particulars	Items included in the	2025-26	2024-25	Variance
	Numerator/Denominator
Capital to Risk weighted assets ratio	Tier I +Tier II Capital/Aggregated Risk weighted assets	(3,76,562.67)	(5,20,336.86)	27.63%
Tier I CRAR	Tier I Capital /Aggregated Risk weighted assets	(3,76,562.67)	(5,20,336.86)	27.63%
Tier II CRAR	Tier II Capital /Aggregated Risk weighted assets	0	0	0

COMMENTS OF THE COMPTROLLER AND AUDITOR GENERAL OF INDIA UNDER SECTION 143(6) (b) OF THE COMPANIES ACT,

2013 ON THE FINANCIAL STATEMENTS OF IND BANK HOUSING LIMITED FOR THE YEAR ENDED 31 MARCH 2026

The preparation of financial statements of Ind Bank Housing Limited for the year ended 31 March 2026 in accordance with the financial reporting framework prescribed under the Companies Act, 2013 (Act) is the responsibility of the management of the company. The statutory auditor appointed by the Comptroller and Auditor General of India under section 139 (5)of the Act is responsible for expressing opinion on the financial statements under section 143 of the Act based on independent audit in accordance with the standards on auditing prescribed under section 143(10) of the Act. This is stated to have been done by them vide their Audit Report dated 13 April 2026.

I, on behalf of the Comptroller and Auditor General of India, have conducted a supplementary audit of the financial statements of Ind Bank Housing Limited for the year ended 31 March 2026 under section 143(6)(a) of the Act. This supplementary audit has been carried out independently without access to the working papers of the statutory auditors and is limited primarily to inquiries of the statutory auditors and company personnel and a selective examination of some of the accounting records. Based on my supplementary audit, I would like to highlight the following significant matters under Section 143(6)(b) of the Act which have come to my attention and which in my view are necessary for enabling a better understanding of the Financial Statements and the related Audit Report.

A. Comment on Cash Flow Statement

Statement of Cash Flows as on 31.03.2026

Paragraph 7 of Ind AS 7, Statement of Cash Flows, provides that cash equivalents are held for the purpose of meeting short-term cash commitments rather than for investment or other purposes. It further states that, for an investment to qualify as a cash equivalent, it must be readily convertible into a known amount of cash, be subject to an insignificant risk of changes in value, and normally have an original maturity of three months or less from the date of acquisition.

It was observed that in the Statement of Cash Flows for the financial year 2025 26, fixed deposits amounting to 14.62 crore, classified under Other Bank Balances (note 2), were included as part of the closing balance of Cash and Cash Equivalents. Similarly, the opening balance of Other Bank Balances amounting to 3.68 crore was included as part of the opening balance of Cash and Cash Equivalents. Since, the Other Bank Balances do not qualify as Cash and Cash Equivalents in terms of Ind AS 7, their inclusion in the Cash and Cash Equivalents in the Statement of Cash Flows is not in accordance with the requirements of Ind AS 7.

B. Comment on Disclosure

Other Bank Balances (Note 2): 14.62 crore

Other Bank Balances (Note 2) of 14.62 crore, comprising, inter alia, 11 crore maintained in a no-lien fixed deposit that was not freely available for the Companys operational use. It was observed that the said amount was maintained in a no-lien fixed deposit with Indian Bank in accordance with the terms of the One-Time Settlement approved by the Board of Directors, which was offered by the mortgagor for settlement of the loan availed by the borrower. Under the OTS terms, 10 per cent of the settlement amount of 110 crore, amounting to 11 crore, was required to be deposited in the said no-lien account. Accordingly, the amount was subject to contractual restrictions and was not available for the Companys operational or general business use. The company did not disclose the existence, nature and extent of the restriction on the use of this significant balance.

	For and on behalf of the
	Comptroller & Auditor General of India
	Sd/-
	(Vijay N. Kothari)
	Director General of Audit (Financial Services), Mumbai
Place : Mumbai
Date : 24.07.2026