Mufin Green Finance Ltd Directors Report

To

The Members

Mufin Green Finance Limited

The Board of Directors are pleased to present the 8^th (Eighth) Annual Report of the Company, together with the Audited Financial Statements for the Financial Year (FY) ended March 31, 2024.

1. FINANCIAL SUMMARY

(Rs. in lakhs)

	Standalone		Consolidated
Particulars	2023-24	2022-23	2023-24	2022-23
Total Revenue	9,843.74	3,461.74	9,843.74	-
Total Expenses	7,668.05	2,382.62	7,668.25	-
Profit Before Tax	2,123.40	1,089.12	2,123.20	-
Less:- Tax (including deferred tax)	517.01	267.45	517.01	-
Profit for the period	1,606.39	811.67	1,606.19	-
Other Comprehensive	2.03	(2.04)	2.03	-
Income
Total comprehensive profit for the year	1,608.42	809.63	1,608.22	-
Basic and diluted EPS (In Rs.)	1.05	0.58	1.05	-

2. STATE OF COMPANY AFFAIRS & OPERATIONS

Mufin Green Finance has built a sustainable foundation to accelerate its growth. Its customer-centric products, transparency in operations, relentless focus on customer convenience and investment in technology has helped accelerate its operations. Mufin Green Finance is in the business of fostering the financial inclusion of unbanked and underserved customers through its various E-Vehicle Loans.

Its income during the year grew by 183.65% to 97.80 Crores in FY24 from 34.48 Crores in FY23. Profit After Tax (PAT) increased by 117% to 16.08 Crores in FY24 from 7.41 Crores in FY23, an increase of AUM by 138.57% to 624.13 Crores in FY24 from 261.61 Crores in FY23. The Net Worth increased by 56.78% from 150.35 Crores in FY23 to 235.73 Crores in FY24. As a prudent risk management practice. GNPA has declined to 1.70% in FY24 as compared to 2.61% in FY23.

A detailed analysis of the operational performance and state of affairs of the Company has been discussed in detail in the Management Discussion and Analysis Report and Corporate Overview section of this Annual Report.

3. CHANGE IN THE NATURE OF BUSINESS, IF ANY

There is no change in the nature of business of your Company during the year under review.

4. TRANSFER TO RESERVES

There has been no transfer to general reserves during the year. As required by Reserve Bank of India, the Company made a transfer of Rs. 321.28 lakhs to statutory reserves constituting 20% of the net profits made during the year under review.

5. DIVIDEND

After careful assessment of the available profit during the financial year ended 31st March, 2024, your Directors have not recommended any dividend for the financial year ended 31st March, 2024.

6. CAPITAL STRUCTURE

Authorised Share Capital

During the year under review Authorized Share Capital of the Company has been increased from Rs. 7,00,00,000 (Rupees Seven Crore only) comprising of 7,00,00,000 (Seven Crores) Equity Shares of Rs. 1 (Rupees One) each to Rs. 50,00,00,000 (Rupees Fifty Crores only) comprising of 50,00,00,000 (Fifty Crores) Equity Shares of Rs. 1 (Rupees One) each.

Paid up Share Capital

During the year under review, the Company has allotted 11,17,73,448 Equity Shares of face value of Rs. 1 each as per the details mentioned below:

S. No. Number of Shares	Type of issue	Issue price (In Rs.)
1. 10,06,63,448	Bonus Issue	NA
2. 1,01,80,000	Preferential Issue	55
3. 9,30,000	Preferential Issue	63.30

Accordingly, paid-up capital stand increased to 16,21,05,172 Equity Shares.

7. SUBSIDIARIES/JOINT VENTURES/ASSOCIATE COMPANIES

During the year under review, Company has following subsidiaries companies:

1. Mufin Green Leasing Private Limited- Wholly Owned Subsidiary

2. Mufin Green Infra Limited- Subsidiary

8. NON-CONVERTIBLE DEBENTURES

During the year under review, your Company has issued 750 Secured, Rated, Redeemable, Non-Convertible

Debentures ("NCD"), having face value of Rs. 1,00,000 each aggregating to 7.50 Crore on a private placement basis.

Non-Convertible Debentures amounting Rs. 6.25 Crore were outstanding as on 31st March, 2024.

9. DIRECTORS AND KEY MANAGERIAL PERSONNEL

Appointment, Re-appointment and Resignation

Mrs. Srishti Agarwal will retire at the ensuing Annual General Meeting (AGM) and being eligible, has offered herself for re-appointment. The Board recommends her re-appointment to the members in the ensuing AGM.

During the period under review, there were change in Directors of the Company, details of the same are as follows:

Sl. No. Name	Designation	Date of Change	Appointment/Cessation
1. Mrs. Srishti Agarwal	Non- Executive Non- Independent Director	11.08.2023	Appointment
2. Mrs. Neha Agarwal	Non- Executive Non- Independent Director	03.08.2023	Cessation
2. Mr. Abhinav Tambi	Independent Director	23.08.2023	Cessation

Retirement of director by rotation

Mrs. Srishti Agarwal (DIN 10229578), non-executive non independent director of the Company will retire by rotation at the ensuing AGM and being eligible, offers herself for re-appointment. The Nomination and Remuneration Committee in its meeting held on September 05, 2024 has recommended to the Board of Directors and Members, reappointment of Mrs. Srishti Agarwal as director of the company retiring by rotation. Her profile is given in the Notice of the ensuing AGM, forming part of this Annual Report.

Declaration by Independent Directors

All Independent Directors have given declaration that they meet the criteria of independence with relevant integrity, expertise, experience and proficiency as provided under Section 149 read with Schedule IV of the Act and Regulation 16 of the SEBI Listing Regulations and have also complied with the code of conduct of Directors and Senior Management. They have also given declaration that their names were included in the data bank of Independent

Directors being maintained with ‘Indian Institute of Corporate Affairs under Rule 6 (3) of the Companies (Appointment and Qualification of Directors) Rules, 2014.

Policies on appointment of Directors

The management of the Company is immensely benefitted from the guidance, support and mature advice from members of the Board of Directors who are also members of various committees. The Board consists of directors possessing diverse skill, rich experience to enhance quality of its performance. The Company has adopted a Policy on Board Diversity formulated by the Nomination and Remuneration Committee.

Annual Performance Evaluation of the Board

The Board, the Committees of the Board and independent directors continuously strive for efficient functioning of Board and its committees and better corporate governance practices. A formal performance evaluation was carried out at the meeting of the Board of Directors held on May 28, 2024 where the Board made an annual evaluation of its own performance, the performance of directors individually as well as the evaluation of the working of its various Committees for the Financial Year 2023-24 on the basis of a structured questionnaire on performance criteria. The Board expressed its satisfaction with the evaluation process. The observations made during the evaluation process were noted and based on the outcome of the evaluation and feedback of the Directors, the Board and the management agreed on various action points to be implemented in subsequent meetings.

The evaluation process endorsed cohesiveness amongst directors, the openness of the management in sharing the information with the Board and placing various proposals for the Boards consideration and approval.

The Independent Directors met on March 25, 2024 without the presence of other directors or members of Management. All the Independent Directors were present at the meeting. In the meeting, the independent directors reviewed performance of Non Independent Directors, the Board as a whole and Chairman. They assessed the quality, quantity and timeliness of flow of information between the Company Management and the Board. The Independent Directors expressed satisfaction over the performance and effectiveness of the Board, individual Non-Independent Directors.

Women Directors

In terms of the provisions of Section 149 of the Companies Act, 2013, and Regulation 17(1)(a) of the SEBI (LODR) Regulations, 2015, the Company shall have at least one Woman Director on the Board. Your Company has Ms. Srishti Agarwal (DIN: 10229578) as the Woman Director on the Board of the Company.

Meetings of the Board

During the year, nine (9) meetings of the Board of Directors were held. The details of Board/Committee Meetings and the attendance of Directors are provided in the Corporate Governance Report, attached to this Report.

10. DEPOSIT UNDER CHAPTER V OF THE COMPANIES ACT, 2013

Your Company has not accepted any public deposits during the year under review and shall not accept any deposits from the public without obtaining prior approval of the RBI. Further, your Company being an NBFC, disclosure requirements under Chapter V of the Act read with Rule 8(5)(v) and 8(5)(vi) of the Companies (Accounts) Rules, 2014 are not applicable to your Company.

11. AUDITORS & AUDIT REPORTS Statutory Auditors

As per Section 139 of the Companies Act, 2013, read with Companies (Audit and Auditors) Rules, 2014, the members of our Company in its 7th AGM of the Company approved the. appointment of M/s Tattvam & Co., Chartered Accountants (Firm Registration No. 015048N), Delhi as Statutory Auditors of the Company, for a term of 3 (three) consecutive years from the conclusion of the 07th Annual General Meeting till the conclusion of the 10th Annual General Meeting. The reports of Statutory Auditors on Financial Statements for the FY 2023-24 forms part of the Annual Report. There are no qualifications, reservations, adverse remarks, disclaimer or emphasis of matter in the Auditors Reports.

Secretarial Auditor

In terms of the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company had appointed Mr. Abhay Kumar, Practicing Company Secretary, to undertake the Secretarial Audit of the Company for the FY ended March 31, 2024. The Secretarial Auditors in their Secretarial Audit Report have reported that The Company has received notice for non- compliance of Regulation 295(1) of ICDR Regulations regarding delay in implementation of bonus issue by 1 (one) day.

BSE has imposed a fine of Rs. 20,000 against the non-compliance, which was paid by the Company as per the mail dated July 24, 2023. The Secretarial Audit Report is attached as Annexure-1 to this report. The Board has re-appointed Mr. Abhay Kumar, Company Secretary in Practice, as Secretarial Auditors of the Company for FY 2024-25.

Internal Auditors

The Board has re-appointed M/s. J. Mandal & Co. LLP (FRN: 0302100E/N500422), Chartered Accountants, Delhi as the Internal Auditors of the Company in its Board Meeting held on 28th May, 2024 for the Financial Year 2024-25. The Internal Audit report is submitted every quarter before the Audit Committee by the Internal Auditors.

12. DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 134 of the Companies Act, 2013, with respect to Directors Responsibility Statement, it is hereby confirmed that: in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures; the Directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the FY i.e. March 31, 2024 and of the profit and loss of the Company for the year ended March 31, 2024; the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

the Directors have prepared the annual accounts on a going concern basis;

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.

Based on the framework of internal financial controls for financial reporting and compliance systems established and maintained by the Company, work performed by the internal, statutory and secretarial auditor and the reviews performed by the management and the relevant Board committees, including the

Audit Committee, the Board is of the opinion that the Companys internal financial controls were adequate and effective during the FY 2023-24; and the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

13. INTERNAL FINANCIAL CONTROLS

Internal Financial Controls laid down by the Company is a systematic set of controls and procedures to ensure orderly and efficient conduct of its business including adherence to the Companys policies, safeguarding of its assets, prevention and detection of frauds and errors, accuracy and completeness of the accounting records and timely preparation of reliable financial information. Internal financial controls not only require the system to be designed effectively but also to be tested for operating effectiveness periodically.

The Board is of the opinion that internal financial controls with reference to the financial statements were tested and reported adequate and operating effectively. The internal financial controls are commensurate with the size, scale and complexity of operations.

14. RESERVE BANK OF INDIA GUIDELINES

As on 31st March, 2024, the Company falls in the middle layer on group level as per the Master Direction Reserve Bank of India (Non-Banking Financial Company Scale Based Regulation) Directions, 2023. The Company continues to comply with all the applicable directions, regulations, guidelines, etc. prescribed by RBI from time to time.

15. DETAILS OF FRAUDS REPORTED BY AUDITORS

There were no frauds reported by the Statutory Auditors under the provisions of Section 143(12) of the Companies Act, 2013 and the Rules made there under.

16. DISCLOSURES OF ORDERS PASSED BY REGULATORS OR COURTS OR TRIBUNALS

There were no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status of the Company and its operations in future.

17. COMMITTEES OF BOARD

The Company has the following committees of the Board of Directors as on March 31, 2024 and the details pertaining to such committees are mentioned in the Corporate Governance Report, which forms part of the Annual Report.

Audit Committee

Nomination and Remuneration Committee

Stakeholders Relationship Committee

Corporate Social Responsibility Committee

18. NOMINATION AND REMUNERATION POLICY

The Companys policy on appointment of Directors is available on the Companys website on www.mufingreenfinance.com.

The policy on remuneration and other matters provided in Section 178(3) of the Act has been disclosed in the Corporate Governance Report, which is a part of this report.

19. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

The Company had formulated a policy on Related Party Transactions (‘RPTs), dealing with the review and approval of

RPTs. The Policy provides for identification of RPTs, necessary approvals by the Audit Committee/Board/Shareholders, reporting and disclosure requirements in compliance with the Companies Act, 2013 and provisions of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

All the transactions executed by the Company during the FY, with Related Parties, were on arms length basis and in ordinary course of the business. All such Related Party Transactions were placed before the Audit Committee/Board for approval, wherever applicable. Also, the Company has obtained shareholders approval on the material Related Party Transaction in the previous Annual General Meeting.

During the FY, the Company has entered into contract/arrangement/transaction with related party, which is considered material in accordance with Regulation 23 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and the same was approved by the Shareholders in the previous Annual General Meeting held on

September 28, 2023. The policy for determining ‘material subsidiaries and the policy on materiality on Related Party

Transactions and dealing with Related Party Transactions, as approved by the Board, may be accessed on the website of the Company i.e. www.mufingreenfinance.com. Your Directors draw attention of the members to Note No. 41 to the Financial Statements which sets out the Related Party disclosures. Since all Related Party Transactions entered into by the Company were on arms length basis and in the ordinary course of the business and the Company had not entered into any material related Party contract as per the Companies Act, 2013, the Form AOC-2 is not required to be provided.

20. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

Considering that the Company is a Non-Banking Financial Company which is not involved in any manufacturing or processing activities, the particulars as required under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 regarding conservation of energy and technology absorption are not applicable.

Further, there was Foreign Exchange outgo during the FY 2023-2024, details of which are as follows:

(Rs. In Lakhs)

Nature	For the	year	ended	For	the	year	ended
	March 31, 2024			March 31, 2023
Professional Fee	30.78			58.18
Sponsorship Fee	2.75			2.79
Travelling Expenses	14.70			2.93
Interest Expenses	11.76			-

21. PARTICULARS OF EMPLOYEES

Disclosure with respect to the remuneration of Directors and Employees as required under Section 197 (12) of the Companies Act, 2013 and Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, is annexed as Annexure-2 which forms part of this Report.

In terms of the provisions of Section 197(12) of the Act read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, during the FY 2023-24 there was no employee drawing remuneration in excess of the limits set out in the said rules.

22. ANNUAL RETURN

Pursuant to Section 92(3) and Section 134(3)(a) of the Companies Act, 2013, the Company has placed a copy of the Annual Return as at March 31, 2024 on its website at www.mufingreenfinance.com By virtue of amendment to Section 92(3) of the Companies Act, 2013, the Company is not required to provide extract of Annual Return (Form MGT-9) as part of the Boards Report.

23. CORPORATE GOVERNANCE

As a responsible corporate citizen, the Company is committed to maintain the highest standards of Corporate Governance and believes in adhering to the best corporate practices prevalent globally.

A detailed Report on Corporate Governance pursuant to the requirements of Regulation 34 read with Schedule V of the SEBI Listing Regulations, is attached to this Report as Annexure-3. A certificate from the Practicing Company Secretary confirming compliance with the conditions of Corporate Governance, as stipulated in Clause E of Schedule V to the SEBI Listing Regulations is attached to the Corporate Governance Report.

The Board Members and Senior Management Personnel have affirmed compliance with the Code of Conduct for Directors and Senior Management for the year ended March 31, 2024. A certificate from the Managing Director confirming the same is attached to the Corporate Governance Report.

A certificate from the CEO and CFO confirming correctness of the financial statements, adequacy of internal control measures, etc. is also attached to the Corporate Governance Report.

24. MANAGEMENT DISCUSSION AND ANALYSIS

The Management Discussion and Analysis Report for the year under review, as stipulated under the SEBI Listing Regulations, is presented in a section forming part of this Annual Report and is annexed to this report as Annexure 4.

25. VIGIL MECHANISM / WHISTLE BLOWER POLICY

The details of Vigil Mechanism (Whistle Blower Policy) adopted by the Company have been disclosed in the Corporate Governance Report and forms an integral part of this report.

26. PARTICULARS OF LOAN, GUARANTEES OR INVESTMENTS

The provisions of Section 186 of the Companies Act, 2013 pertaining to investment and lending activities is not applicable to the Company since the Company is Non-Banking Financial Company (NBFC) whose principal business is investment in securities and providing loan of all kinds.

27. MATERIAL CHANGES AND COMMITMENTS

No material changes or commitment has occurred after the close of the FY 2023-24 till the date of this Report, which affects the financial position of the Company.

28. CORPORATE SOCIAL RESPONSIBILITY

The Companys approach towards Corporate Social Responsibility (CSR) is to interweave social responsibility of the Company into Companys mainstream business functions. CSR is an integrated part of the Company Policy. The Company is committed to bring a tangible change in the lives of people living in the surroundings by giving them employment opportunities, as well as by their socioeconomical development. All CSR initiatives are being planned, executed and monitored by the Committee/ Board. The CSR programs are aligned with Govt. mandate at Local and State Level and as per the specific needs of the Community. Some of the initiatives taken by the Company in field of socio economical development, education & health are

- Promotion of education

- Promotion of Employment

- Animal Welfare

A Board level Committee of CSR has been constituted. The details of membership of the Committee & the meetings held are detailed in the Corporate Governance Report, forming part of this Report. The Corporate Social Responsibility Policy is available on the website of the Company at the www.mufingreenfinance.com.

The Annual Report on Corporate Social Responsibility activities is annexed to this report as Annexure-5.

29. COMPLIANCE WITH SECRETARIAL STANDARDS OF INSTITUTE OF COMPANY SECRETARIES OF INDIA

The Company has complied with the Secretarial Standard-1 on ‘Meetings of the Board of Directors and Secretarial Standard-2 on ‘General Meetings issued by the Institute of Company Secretaries of India.

30. BOARD EVALUATION

A statement on annual evaluation by the Board of its performance and performance of its committees as well as Individual Directors forms part of the Corporate Governance Report attached to this report.

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

The Company has a policy on prevention of sexual harassment at the workplace. The Company has complied with the provisions relating to the constitution of Internal Complaints Committee under Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.During the FY 2023-24, there were no complaints received.

32. COST RECORDS AND AUDIT

Maintenance of cost records and requirement of cost audit as prescribed under the provisions of Section 148(1) of the Companies Act, 2013 are not applicable for the business activities carried out by the Company.

33. INVESTOR SERVICES

In its endeavor to improve investor services, your Company has taken the following initiatives:

An Investors Section on the website of the Company www.mufingrenfinance.com has been created.

There is a dedicated e-mail id apmfinvestltd@gmail.com for sending communications to the Company Secretary.

Disclosure made to the Stock Exchange are promptly uploaded on the website of the Company for information of the Investors.

Members may lodge their requests, complaints and suggestions on this e-mail as well.

34. BUSINESS RESPONSIBILITY AND SUSTAINABILITY REPORT (BRSR)

As a responsible corporate citizen, ESG (Environmental, Social, and Governance) is highly relevant for the company. It demonstrates our commitment to Environmental stewardship, social responsibility, and good governance. In terms of Regulation 34(2)(f) of SEBI (Listing Obligation and Disclosure Requirements) Regulations, 2015, Business Responsibility and Sustainability Report for the financial year under review is presented in a separate section forming part of the Annual Report. The detailed information on the initiatives taken by the Company from an environmental, social and governance perspective is provided in the Business Responsibility and Sustainability Report which forms part of this Report as Annexure-6.

35. FAIR PRACTICE CODE (FPC)

The Company has in place, a Fair Practice Code approved by the Board in compliance with the guidelines issued by the RBI, to ensure better service and provide necessary information to customers to take informed decisions. The FPC is posted on the website of the Company at https://www.mufingreenfinance.in. The FPC is also reviewed by the Board at frequent intervals to ensure its level of adequacy and appropriateness.

36. CREDIT RATING

During FY 2023-24, Credit Rating for the Company has been upgraded to BBB+ : Stable from Acuite Ratings Research from erstwhile BBB : Stable from Acuite Ratings Research.

37. ACKNOWLEDGMENTS

The Directors thank the Shareholders, Banks and other Lenders, Customers, Vendors and other business associates for the confidence reposed in the Company and its management and look forward to their continued support. The Board places on record its appreciation for the dedication and commitment of the employees at all levels, which has continued to be our major strength. We look forward to their continued support in the future.

38. CAUTIONARY STATEMENT

Statements in the Boards Report and Management Discussion and Analysis, describing the Companys objectives, outlook, opportunities and expectations may constitute "Forward Looking Statements" within the meaning of applicable laws and regulations. Actual results may differ from those expressed or implied expectations or projections, among others. Several factors make a significant difference to the Companys operations including the government regulations, taxation and economic scenario affecting demand and supply, natural calamity and other such factors over which the Company does not have any direct control.