Religare Enterprises Ltd Directors Report.

To,

The Members,

Religare Enterprises Limited

Your Directors have pleasure in presenting this 35th Annual Report on the business and operations of the Company together with Audited Financial Statements for the financial year ended March 31,2019.

STATE OF AFFAIRS OF THE COMPANY

Your Company has been facing extremely challenging times recently due to allegations in relation to financial irregularities in various past transactions and siphoning of funds primarily through Religare Finvest Limited ("RFL"), a material subsidiary company, committed by the past management and promoters of the Company which have attracted investigations into the Company by the Securities and Exchange Board of India ("SEBI") and Serious Fraud Investigation Office ("SFIO"). The situation further deteriorated due to continuous negative media attention on the issues at the promoters level leading to serious repercussions on the Religare group.

Post resignation of the Promoters i.e. Mr. Malvinder Mohan Singh and Mr. Shivinder Mohan Singh as Board members in February 2018 due to immense pressure brought on them by the institutional shareholders; professional Board members have been inducted on the Board to provide leadership and guidance to the Religare Group in these challenging times. A new and experienced Management Team has also been inducted into the Company and RFL and they are in further process of inducting fresh management talent across the Group to plug in the talent gaps across various functions.

Due to intervention of some institutional investors, the Company was able to attract investors into the Company and consequently came out with a Preferential Issue of convertible warrants and raised much needed funds to the tune of र 297 crores approx, in the financial year 2018-19 which was primarily utilized to meet external debt repayments and protect the value of the underlying investments to ensure that the Religare Group emerges financially strong and stable over a period of time. The allocation of capital has been a fine balance between paying off external liabilities and to provide funding to subsidiary businesses to help them remain solvent which played a critical role and helped the Group restore confidence amongst various stakeholders i.e. Investors, Employees, Business Partners and Banks etc.

During the year under review and thereafter, various initiatives have been taken towards revival of the Company and the Group ranging from filing application for re-classification of Promoters and Promoters Group into Public Shareholders category, forensic audit of the Corporate Loan Book ("CLB") transactions at RFL, filing of recovery proceedings at various forums for the recovery of money advanced under the CLB of RFL, submission of criminal complaints with appropriate forums against the Promoters and past management for investigation of various suspicious transactions involving fund movement from the Company and so on; details ofwhich are explained further in this report.

The new management has explored various fund raising options in the Company and its subsidiaries, few ofwhich materialized leading to introduction of new strategic investors in the insurance vertical at a critical time when the Company had to infuse further capital in the same to maintain the solvency ratio.

In order to revive the lending vertical which has been suffering due to the past financial transactions, the new management has proposed a Debt Resolution Plan at RFL and introduction of new strategic investor in RFL; the details of which are elsewhere explained in the Report.

All these measures have helped the Religare Group in not only avoiding a financial collapse but also are steps towards strengthening the overall position of the Group. The Company wishes to seek the continued support of the entire investors group, specially the current warrant holders whose timely intervention is of immense importance for the Companys future alongwith the support of the other stakeholders to meet the challenges effectively. The new Board and management are hopeful to come out of these difficult times and to bring back the Company to its past glory with your enduring patience and support.

FINANCIAL RESULTS AND BUSINESS OPERATIONS

The highlights of standalone and consolidated financial results of the Company for the Financial Years 2018-19 and 2017-18 are as under:

( in Lakh)

Particulars

For the financial year ended 2018-2019

For the financial year ended 2017-2018

Standalone

(Audited)

Consolidated

(Audited)

Standalone

(Audited)

Consolidated

(Audited)

Total Income 3,516.57 240,171.81 7,189.44 273,541.77
Total Expenditure 18,127.79 390,516.06 40,529.30 414,261.67
Profit before Tax (14,611.22) (150,344.25) (33,339.86) (140,719.90)
Exceptional Items - (8.96) - (22.98)
Profit / (Loss) before Tax after exceptional items (14,611.22) (150,353.22) (33,339.86) (140,742.88)
Income tax Expense/ (Credit) - (258.16) (714.70) (22691.81)
Profit / (loss) After Tax (14,611.22) (150,095.06) (32,625.16) (118,051.07)
Other Comprehensive Income 16.19 395.34 (10.87) (409.82)
Total Comprehensive Income for the period (14,595.03) (149,699.72) (32,636.03) (118,460.89)
Less: Share of Non- Controlling Interest - (21,347.86) - (13,596.11)
Total Comprehensive Income/ (Loss) (after tax and non-controlling interest) (14,595.03) (128,351.86) (32,636.03) (104,864.78)

Note: The Company has adopted Ind-AS notified under Section 133 of the Companies Act, 2013 read with the Companies (Indian Accounting Standard) Rules, 2015 from April 01, 2018 with effective transition date of April 01,

2017. Accordingly, these financial statements together with the comparative reporting period have been prepared in accordance with the recognition and measurement principals as laid down in Ind-AS. Accordingly, the previous years figures have been regrouped and rearranged wherever necessary to align with the current years presentation.

In last Directors Report for year ended March 31, 2018, financial performance is reported in accordance with accounting standards notified under the Section 133 of the Companies Act, 2013, read together with Rule 7 of the Companies (Accounts) Rules, 2014 ("Indian GAAP"or"Previous GAAP").

(i) Consolidated Results

We recorded a Loss After Exceptional Items and Before Tax ofर 150,353.22 Lakhs, for Financial Year 2018-19 as compared to Loss After Exceptional Items and Before Tax of र 140,742.88 Lakhs, for Financial Year 2017-18. ‘Loss After Tax and Share in Joint Venture was र 150,095.06 Lakhs for Financial Year 2018-19 as compared to ‘Loss After Tax and Share in Joint Venture of र 118,051.07 Lakhs for Financial Year 2017-18. Total Comprehensive lncome/(Loss) attributable to the Owner of the Company for the Financial Year 2018-19 is र (1,28,351.86) Lakhs as compared to र (104,864.78) Lakhs in Financial Year 2017-18. Basic earnings per share decreased to र (63.32) in Financial Year 2018-19 from र (58.56) in Financial Year 2017-18.

One of the major causes for which the Company has incurred losses on a consolidated basis is a provision of र 1,092.58 crore in Financial Year 2018-19 and र 1,025.17 crore in Financial Year 2017-18 made against corporate loans given by Religare Finvest Limited, a subsidiary of the Company to the entities known to the Promoter group.

(ii) Standalone Results

We recorded a ‘Loss After Exceptional Items and Before Tax ofर 14,611.22 Lakhs, for Financial Year 2018-19 as compared to ‘Loss After Exceptional Items and Before Tax ofर 33,339.86 Lakhs, for Financial Year 2017-18. ‘Loss After Tax was र 14,611.22 Lakhs for Financial Year 2018-19 as compared to ‘Loss After Tax of र 32,625.16 Lakhs for Financial Year 2017-18. Total Comprehensive Income / (Loss) for the Financial Year 2018-19 is र (14,595.03) Lakhs as compared to र (32,636.03) Lakhs in Financial Year 2017-18. Basic earnings per share increased to र (6.93) in Financial Year 2018-19 from र (18.28) in Financial Year 2017-18.

(iii) Operating Performance ofBusinesses

In the Lending business, our subsidiary Religare Finvest Limited ("RFL"), which is focused primarily on lending to the SME segment, had total book size ofर 7,085 crores out ofwhich SME book constituted 64% and amounted to र 4,503 crores as at March 31, 2019 in accordance with Ind-AS. RFL has been under the Corrective Action Plan ("CAP") of RBI vide its letter dated January 18, 2018 and has been prohibited from expansion of credit/ investment portfolio other than investment in government securities and not to pay dividend. Hence, RFL focused its efforts on collections and recovery. As of March 31, 2019, RFL has made provisions on its entire Corporate Loan Book of र 2,037 crores. RFL retains its presence across 28 branches across SME clusters in India alongwith its experienced SME focused management team. RFL is also actively pursuing legal and regulatory matters towards resolving all issues and restoring normalcy in its business operations at the earliest. Efforts are also being made to raise capital at Group and subsidiary level.

RFLs subsidiary, Religare Housing Development Finance Corporation Limited ("RHDFC"), which focuses on providing loans to the affordable housing segment, disbursed loans totaling र 107 crores, and the total book size stands at र 706 crores as at March 31,2019 in accordance with Ind-AS. The PAT after OCI for the financial year is र 9.7 crores. The current book consists of 72% of Affordable house loans followed with 23% of Loan against Property; the remaining 5% consists of builder loans. RHDFC has a pan India presence with a network of 30 branches. RHDFC has remained profitable in each year of its operations since it became a part of the Religare group.

Our Health Insurance business, Religare Health Insurance Company Limited ("RHICL") registered Gross Written Premium of र 1,843 crores during the Financial Year 2018-19, a growth of 65% over the previous financial year and reported PBT ofर 57 crores. As at March 31,2019, RHICL has established a Pan-India distribution network of 110+ branches. It services over 700+ locations across the Country and has a hospital network of 9450+ hospitals. It offers 18 products to cater to varied customer needs. The company follows a multi-product and multichannel distribution strategy. Its products span across retail health, group health, travel insurance, etc. and it has a good channel mix consisting ofagency, brokers, corporate agents, online and bancassurance.

The Retail Broking business, which comprises of Religare Broking Limited ("RBL"), Religare Commodities Limited ("RCL") and its subsidiaries, reported consolidated revenue ofर 278 crores. RBL services more than one million unique customers and has presence in 400+ towns and cities across India. RBL provides multi-platform options such as Branch, Web, App, Call n Trade to enhance customer convenience and ease. RBL also has Bancinvest partnerships with various banks like Andhra Bank, Bank of Maharashtra, Corporation Bank, Dhanlaxmi Bank Limited, Induslnd Bank Limited, etc. Adding another feature to its hat, for FY 2019, RCL won Best Broking House -2019 by Bullion by MCX.

The commodities arbitrage business was stopped in the middle of FY17-18. Religare Comtrade Ltd. ("RCTL") has exited all its market positions, and repaid all its external debt on time and in full. RCTL is held 100% under REL (directly and indirectly). Since, RCTL is now not an operating business, it is proposed to be merged into the Company /REL, to simplify the REL corporate structure and eliminate outstanding inter group transactions. The respective Boards of REL and RCTL have approved the Scheme of Amalgamation in their meetings dated May 23, 2019. The Scheme of Amalgamation will be filed with Honble NCLT in due course.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

Managements Discussion and Analysis Report for the year under review detailing economic scenario and outlook, as stipulated under Schedule V of the SEBI (Listing Obligations and Disclosures Requirements) Regulations, 2015 ("SEBI LODR Regulations") is presented in a separate section and forms an integral part ofthis Report.

DIVIDEND AND RESERVES

Since there were losses during the period and no dividend was declared, no amounts were transferred to reserves.

The Company had formulated and approved a Dividend Distribution Policy ("the Policy") pursuant to the requirement under the SEBI (Listing Obligations and Disclosure Requirements) (Second Amendment) Regulations, 2016 in its meeting held on October 26, 2016. Details of the same have been uploaded on the website of the Company and can be accessed through the link i.e. https://www.religare.com/pdf/Rel_Dividend_PolicyNov2016.pdf

However, the members may please note that the RBI vide its letter dated April 5, 2019 has advised the Company to stop paying dividends till further orders from RBI.

SUBSIDIARIES & JOINT VENTURES

As at March 31,2019, your Company has 25 direct and indirect subsidiaries. During the year under review, the changes in the businesses of the Company and its subsidiaries have been explained elsewhere in this report and Managements Discussion and Analysis Report. In terms of Section 129(3) of the Companies Act, 2013 ("Act"), your Company has prepared a statement containing the salient features of the Financial Statements of our subsidiaries & joint ventures in the prescribed format AOC-1 which is attached to the Consolidated Financial Statements of the Company. The said statement contains a report on the performance and financial position of each of the subsidiaries and hence is not repeated here for the sake of brevity. Further, the details of major subsidiaries of the Company and their business operations during the year under review are covered in the Managements Discussion and Analysis Report.

During the year under review, the following companies ceased to be subsidiaries of the Company:

1. Argil Advisors LLP

2. Religare Capital Markets International (UK) Limited

As at March 31, 2019, your Company has 1 joint venture i.e. IBOF Investment Management Private Limited in which the Company holds 50% share capital.

Religare Finvest Limited ("RFL")

1. Capital Adequacy Ratio and Corporate Loan Book

The Capital to Risk Weighted Assets ratio ("CRAR") of RFL as on March 31, 2019 is below the prescribed limit. RFL had an exposure of र 203,670 Lakhs as per financials as at March 31,2019 towards the Corporate Loan Book. RBI has raised concerns in the past about the creditworthiness of the borrowers, credit appraisal and loan sanctioning mechanism followed by RFL in respect of this book. In view of RBI concerns, the first step the new Board/management has taken immediately after taking charge was that it has reviewed the portfolio and the financial reports of the borrowers to determine the recoverability of the said loans. As a part of the recovery process, the management issued legal notices to the borrowers and has initiated corporate insolvency resolution process under Insolvency and Bankruptcy Code, 2016, against the said entities comprising the Corporate Loan Book.

A law firm of repute was appointed to undertake a detailed diligence on this loan book and the said diligence has been completed. Insolvency proceedings have been initiated before the NCLT Delhi and Kolkata against the Borrowers forming a part of the Corporate Loan Book. The Insolvency Petitions filed before the NCLT, New Delhi were listed on March 27, 2019 for addressing arguments for the admission of petitions. Arguments were heard at length on the said date and the Honble NCLT was pleased to reserve its order with directions to the counsels for all the parties to file their written submissions. However, the order reserved by NCLT, New Delhi has been stayed by Supreme Court vide order April 05, 2019. Based on the due diligence report and the replies filed by the borrowers before the NCLT, RFL had also filed a criminal complaint before the Economic Offence Wing, Delhi, on which an F.I.R. has been registered and is under investigation. RFL has also filed an insolvency petition against Bharat Road Network Limited before the Honble NCLT, Kolkata.

The management of RFL has reviewed the portfolio and the financial reports of the borrowers to determine the recoverability of the said loans. Based on the maturity dates of the loans, recovery steps instituted and the financial reports of the borrowers, RFL had, on a prudent basis, made full provision of203,670 Lakhs as at March 31, 2019 against this portfolio.

2. Settlement Agreement with Strategic Credit Capital Private Limited ("SCCPL")

In continuation of the disclosures made in previous years Annual Reports in this regard, during the year ended March 31, 2016, there were certain assignment of loans by RFL to SCCPL and during the year ended March 31,2017, the amounts recoverable from SCCPL and Perpetual Credit Services Private Limited (‘Perpetual) aggregating to र 79,367.20 lakhs were written off by RFL and various legal proceedings were initiated by the parties against each other. During the year ended March 31, 2018, RFL entered into a settlement agreement with the counterparties pursuant to which the various cases against each other at various courts and tribunals were withdrawn on consent terms, however RFL retained its right to recover the amounts due from SCCPL and Perpetual. Despite the settlement agreement SCCPL has filed following suits against RFL at various forums.

(i) SCCPL and its associate companies have filed a suit before the Honble District Court, Saket seeking various reliefs including specific performance of part of the Settlement Agreement entered into between RFL and the Petitioners in July 2017, and discharge of their obligations under the Settlement Agreement. In the said matter, RFL has also filed following applications seeking following reliefs:

a. Rejection of plaint.

b. Extension of time for filing written statement.

c. For examination ofdocuments and seeking responses to questions.

The Plaintiffs (SCCPL and associate companies) have filed replies to the applications filed by the Defendant (RFL). The Court has given liberty to RFL to file rejoinder, if any, before the next date of hearing. Next date of hearing is August 31,2019 foraddressing arguments on RFLs applications.

(ii) Strategic Credit Capital Private Ltd. ("SCCPL") & Participation Finance & Holdings (India) Pvt. Ltd. ("PFH") have filed a commercial civil suit before Honble Delhi High Court against Lakshmi Vilas Bank ("LVB"), wherein they have arrayed RFL and other entities as party. SCCPL and PFH are seeking various reliefs in the petition against LVB and amongst other relief, a direction against RFLs fixed deposits placed with LVB. RFL has filed its written statement in the matter. No orders have been passed in this matter with regard to the fixed deposits. An interim order dated February 22, 2018 passed to maintain status quo regarding the trademark as described in the Schedule of the Deed of Assignment. RFL has filed application for rejection of plaint under order-VII Rule-11 and application u/s 340 CrPC against SCCPL for filing fabricated indemnification cum release agreement. Loancore Servicing Solutions Pvt. Ltd. has filed an application seeking substitution in place of Plaintiffs.

Also SCCPL, has filed application seeking injunction against RFL and REL restraining them from selling their business to TCG to which RFL has filed its reply. The matter is currently sub-judice.

3. Insolvency proceeding filed by RFL against SCCPL at NCLT, New Delhi

Nishu Finlease Private Limited ("NFPL") entered into a loan agreement with the SCCPL on 21.07.2015 ("Loan Agreement") whereby the SCCPL had availed a loan facility of र 40 crores from NFPL. The repayment of the borrowed amounts was secured by creation of pledge over securities including 1,32,33,328 equity shares of one ABG Shipyard Ltd. The loan given to SCCPL was repayable within twelve months from the date of disbursal of the loan and carried an interest rate of 12% per annum. On 16.06.2016, RFL entered into a sale agreement with NFPL ("Sale Agreement") whereby RFL purchased the outstanding loan, along with the underlying securities and receivables, given by NFPL to SCCPL under the Loan Agreement for a purchase consideration of ?45 crores. Consequently, RFL acquired all the rights and interests of NFPL qua the loan availed by SCCPL under the Loan Agreement and the underlying security interests created thereunder.

Although in terms of the Loan Agreement, SCCPL was to make payment of the interest on a monthly basis, no such payment was made to RFL. As such, RFL invoked its right under Clause 24.1 of the Loan Agreement and terminated the Loan Agreement by issuing a Termination cum Recall Notice dated 24.06.2016.

The parties then entered into discussions to settle the payment of the outstanding dues. Pursuant to the discussions, RFL and the SCCPL entered into a Settlement Agreement dated 01.07.2017 for payment of the outstanding debt due and payable to the RFL. SCCPL acknowledged its liability to pay the outstanding loan amount ofर 40 crores in the Settlement Agreement. However, no payment was made by SCCPL towards the dues owed by it to the RFL. Accordingly, RFL has filed insolvency petition against SCCPL.

4. Fixed Deposits with Lakshmi Vilas Bank

In continuation of disclosures made in previous year Annual Report in this regard, RFL had made certain Fixed Deposits ("FDs") with Lakshmi Vilas Bank ("LVB") in November 2016 and January 2017. LVB vide its letter dated February 07, 2018 had confirmed fixed deposits ofर 79,144.77 Lakhs to the Company. RFL received a letter dated February 9, 2018 from LVB purporting to allude to certain loans disbursed by LVB to third parties allegedly in consideration of security of the RFLs FDs with LVB. By means of this letter, LVB also purported to call upon RFL to execute the security documentation in connection with the alleged loans. Vide RFLs letter dated February 16, 2018, LVB was expressly informed that not only RFL was not party to any loans that were allegedly sanctioned or granted by LVB to any third party, as also that no authorization, sanction or approval had ever been provided by RFL to LVB permitting the creation of any security or encumbrance of the FDs for any third party loans or borrowings. LVB was also forewarned that any attempt to subject the FDs to illegal encumbrance would not only be violative of RFLs rights, but also constitute deliberate contempt by LVB of the Order dated January 5, 2018 passed by the Honble Delhi High Court, a copy of which was served on LVB vide Legal notice dated February 16, 2018. While things stood thus, RFL came to be in receipt of a copy of the letter dated April 24, 2018 addressed by LVB to the statutory auditors of RFL that LVB had "closed the said deposits on February 20, 2018 to liquidate the loans availed by third parties. This was contrary to the confirmation received by the Statutory Auditors in November 2017 via email confirming the fixed deposits. RFL at no point in time, instructed, authorized or consented to the liquidation of the fixed deposits or the adjustment thereof against loans availed of by any third parties or the creation of any encumbrance on the fixed deposits, whether by way of a lien, security, charge or pledge in connection with the loans availed of by any third parties.

RFL had filed a suit for recovery of amounts misappropriated by the LVB placed as Fixed Deposits with it on May 31,2018 before the Honble Delhi High Court. The Honble High Court was pleased to pass interim Orders directing that status quo be maintained in respect of RFLs current account maintained with LVB. It is pertinent to mention here that LVB has sought to delay the adjudication of the interim reliefs and the suit for recovery sought by RFL by filing multiple applications, all of which have been kept in abeyance by the Honble Court till such time RFLs applications for interim reliefs are disposed of. The pleadings in the matter are now complete, in as much as LVB has filed a reply to RFLs suit and RFL has filed its rejoinder to the same. LVB has further filed a sur rejoinder to the rejoinder filed by RFL. SCCPL and Participation Finance & Holdings (India) Pvt. Ltd. have filed applications to be impleaded in the matter, which are yet to be adjudicated on by the Honble Court. The case has been fixed for arguments on interim applications filed by RFL for various dates since July 19, 2018 till March 11,2019. On March 11,2019 arguments were addressed at length by the counsel of Plaintiff. The Honble Court was pleased to reserve order on the interim application on April 12, 2019.

Thereafter, LVB filed another application placing ex-parte SEBI order dated March 14, 2019 on record. RFL filed affidavit pursuant to the order dated April 9, 2019 passed by the Honble High Court of Delhi along with the reply qua the ex-parte interim orderofthe SEBI dated March 14, 2019 and letters addressed to RBI & NHB.

RFL has now filed an amendment application seeking amendment of plaint before the Honble High Court of Delhi on which notice has been issued for August 23, 2019.

Apart from the civil suit for recovery RFL has also filed a criminal complaint against LVB and other accused persons on May 15, 2019 before the Economic Offences Wing, Delhi which is under investigation.

MAJOR EVENTS

Re-classification of Promoters and Promoters Group

Mr. Malvinder Mohan Singh and Mr. Shivinder Mohan Singh, Promoters of the Company have resigned as Directors of the Company on February 14, 2018 post which the Board of Directors ("Board") was re-constituted and strengthened by inducting professionals having sound credentials, expertise and competence in their respective fields. Post receipt of requisite request and confirmations from the Promoters and Promoters Group for reclassifying them into public shareholders, the Board of the Company approved the request and sought approval of shareholders on the matter by way of postal ballot. The shareholders of the Company approved the matter through postal ballot on October 17, 2018 with requisite majority, results of which were declared on October 18, 2018. Based on the aforesaid approvals, the Company submitted the application for re-classification of Promoters and Promoters group into Public Shareholders category with the stock exchanges in January 2019. In the mater, the Company has also submitted the application with the SEBI in April 2019 seeking relaxation of one of the conditions under the erstwhile Regulation 31A(6)(i) of SEBI LODR Regulations. The reply from the exchanges and SEBI is awaited on the matter.

Issue ofWarrants

During the year under review, on April 19, 2018, your Company allotted 111,497,914 convertible warrants to 38 resident Indian subscribers and received र 145.78 crores as upfront payment which is equivalent to 25% of the total consideration under the terms of issue of convertible warrants approved by the shareholders on March 19, 2018 on a preferential basis to various persons / entities entitling the subscribers to an equal number of equity shares. The warrants issue price is र 52.30 per warrant.

Few warrant holders exercised the conversion option by remitting balance consideration and accordingly were allotted equivalent number of equity shares. Balance consideration received upon such conversion was र 150.97 crores.

The Company had fully utilized the funds received from the warrant holders as per the Objects stated in the Explanatory Statement to the Notice dated February 19, 2018 sent to shareholders of the Company. There were no unutilized funds under the same as on March 31,2019.

In connection to the Companys application with the Department of Economic Affairs ("DoEA"), Ministry of Finance for approval of foreign investment in respect of 63,601,510 warrants intended to be subscribed to by two foreign investors which was not acceded to by the DoEA citing reasons of various investigations by multiple Government agencies / regulators; the Company has requested DIPP, Government of India once again vide letter dated August 28, 2018 to consider the above application favorably.

Composite Scheme of Arrangement

In May 2019, the Board approved, subject to requisite approvals, the draft Scheme of Amalgamation ("Scheme") that is designed to simplify further the Companys corporate structure.

In terms of the Scheme, two (2) wholly owned subsidiaries direct / indirect of Religare Enterprises Limited ("REL") namely, Religare Comtrade Limited and Religare Insurance Limited will merge with/into REL subject to terms and conditions as provided in the Scheme.

The Scheme is in continuation of the steps the Company has taken in the past to simplify the structure and has the following rationale:

• No active business has been carried on by the Transferor Companies. Further, as on date, all liabilities owed by the Transferor Companies are payable to the group entities which are ultimately consolidated into the Transferee Company. Considering the present economic environment, consolidation of the said entities is envisaged through this Scheme

• The Scheme will also result in simplification of holding structure, thereby resulting in reduction in multiplicity of legal and regulatory compliances, reduction of costs and pooling of common resources.

• The Scheme will also facilitate the Transferee Company to meet obligations of the Transferor Companies.

The Scheme will be filed with the Honble NCLT in due course.

Divestment of Lending Business

On July 10, 2019, the Company has entered into a binding term sheet with TCG Advisory Services Private Limited ("TCG"), Religare Finvest Limited ("RFL") and Religare Housing Development Finance Corporation Limited ("RHDFCL"), whereby the Company will divest its entire stake in RFL, a subsidiary of the Company, to TCG or any of its affiliates ("Acquirer"). Pursuant to the aforesaid divestment, the Acquirerwould also acquire indirect interest ofthe Company in RHDFCL, which is a subsidiary of RFL. The transaction is subject to necessary statutory and regulatory approvals and fulfillment ofother conditions precedent.

As explained elsewhere in the report also, RFL whose principal business is SME lending is under the Corrective Action Plan ("CAP") of the Reserve Bank of India ("RBI") since January 2018 and hence restricted from fresh lending till further directions from the RBI. RFL is in need of primary capital to come out of the CAP. In order to address the situation, RFL has proposed to go for a Debt restructuring and an Inter-Creditors Agreement has been signed on July 03, 2019 in this regard.

The above divestment of RFL to Acquirer will enable RFL to meet the requirements of debt restructuring and also raise such primary capital to come out of the CAP and start its lending operations.

Cancellation of Indemnity given to the Promoters

As a part of various corrective steps by the new Board and management, the Board in September 2018 after taking necessary legal advise, cancelled the Indemnification-cum-ReleaseAgreement ("Agreement") dated November 14, 2017 entered among the Promoters, Company and its five subsidiaries.

Vide said Agreement the Company had agreed to indemnify and release the Promoters and their Affiliates as per the terms and conditions set out in the Agreement which was null and void as per legal view obtained by the new Board and management.

REGULATORY UPDATES

Reserve Bank of India ("RBI")

RBI conducted an inspection of the Company under section 45N of the Reserve Bank of India Act, 1934 in the month of July 2018 for the records ofthe Company for the FY 2017-18. The Company has suitably submitted the reply/compliance on the Supervisory Concerns/Advisory Letter issued by RBI in April2019pursuanttosaid inspection.

Further, in the Supervisory Concerns / Advisory Letter, RBI has advised the Company to:

a) Infuse fresh capital to meet regulatory minimum Adjusted Net Worth (ANW) to Risk Weighted Assets (RWA) ratio of 30% by June 30, 2019;

b) Refrain from accessing public funds till ANW to RWA ration of 30% is achieved;

c) Strengthen the Board of REL by inducting whole-time directors with relevant experience, professional competence and fulfilling fit and proper criteria; and

d) Stop paying dividends till further orders from RBI.

The Company has suitably submitted its response to the RBI stating that the Company meets the regulatory minimum ratio of 30% and is engaged with the RBI for other matters.

Further, during the month of July 2019, RBI conducted the inspection under section 45N for the financial position of the Company as on March 31, 2019. The Company is yet to receive a report on the same.

Securities and Exchange Board of India ("SEBI")

(a) In connection with the ongoing investigation of the Company/REL initiated by SEBI in February 2018, an interim ex-parte order was passed by the SEBI on March 14, 2019 ("Order") read with the corrigendum dated April 18, 2019, as a remedial action, pending detailed investigation ofthe matter.

Vide said Order, SEBI has directed as below:

• REL and Religare Finvest Limited ("RFL"), subsidiary company to initiate steps to recall loans amounting to

2315.09 crores extended, directly or indirectly, from RFL to various entities / persons as mentioned in the Order, along with interest within 3 months.

• Pending completion of investigation and till further orders, the said borrower entities / persons, shall not dispose or alienate any of their assets or divert funds except for meeting expenses of day to today business operations, without prior permission of SEBI.

• Mr. Malvinder Mohan Singh and Mr. Shivinder Mohan Singh shall not associate themselves with the affairs of the Company and RFL in any manner till further directions from SEBI.

The Company and its subsidiary RFL have been cooperating in the aforesaid investigation and have been providing the requisite information / documents from time to time and making necessary submissions with SEBI.

(b) SEBI has passed an ad-interim ex-parte order on October 17, 2018 ("Order") in relation to Fortis Healthcare Limited ("FHL") which interalia includes directions to RFL and other entities covered in the order to repay र 40,300 Lakhs to FHL and not to dispose of or alienate any of the assets or divert any funds except for payment of र 40,300 Lakhs and for meeting business operations without the prior permission of SEBI. RFL has represented to SEBI and denied all the preliminary findings recorded against RFL and further requested SEBI to vacate the directions in the said order till conclusion of the investigation.

Furtherance to above, SEBI issued a confirmatory order dated March 19, 2019. The said order inter-alia continued the debilitating restraints against RFL which were originally contained in the ex-parte Order dated October 17, 2018. However, RFL has been allowed to function in compliance with the terms ofthe CAP as stipulated by the Reserve Bank of India. RFL has further represented to SEBI and denied findings recorded against RFL and requested SEBI to vacate the directions in the said order qua RFL. Additionally, RFL has filed an appeal to Securities Appellate Tribunal ("SAT") on April 23, 2019 against the said order seeking relieffrom SAT in the matter. The appeal is in the process of being listed in due course.

On June 19, 2019, RFL Team met SEBI and made a representation and also a written submission was given on June 20, 2019. Thereafter, a personal hearing took place between RFL and SEBI on June 26, 2019. In furtherance to which, SEBI issued order dated June 28, 2019, which modified the said directions, as contained in Para 17 of the confirmatory order as follows:

"The Noticee no. 8 (viz. Religare Finvest Limited), pending completion ofthe investigation, shall not dispose of or alienate any of its assets or divert any funds, without the prior permission of SEBI, except for meeting expenses of day-to-day business operations and taking all measurers as it deems fit for revival of RFL (including restructuring of its debts/loans, assignment of its financial assets to ARCs, raising of capital, borrowing etc.), subject to strict adherence to the terms of "Corrective Action Plan" and any other norms stipulated by the Reserve Bank of India and provisions of all other applicable laws."

(c) SEBI vide Settlement Order dated January 17, 2019, has disposed off the adjudication proceedings initiated vide Show Cause Notice dated July 05, 2018 for delay in filing of disclosure in terms of Regulation 7(2) (b) of the SEBI (Prohibition of Insider Trading) Regulations, 2015 with respect to dealing in securities by Mr. Sunil Godhwani, former Chairman and Managing Director of the Company. The Company has paid र 2,00,000/- (Rupees Two Lakh Only) towards summary settlement amount which was approved by the SEBI in the matter vide its Order of January 17, 2019.

Serious Fraud Investigation Office ("SFIO")

In the matter of ongoing investigation of the Company initiated by SFIO in February 2018, as ordered by Ministry of Corporate

Affairs, Government of India, the Company has been cooperating in the aforesaid investigation and has been providing the requisite information / documents from time to time.

LEGAL UPDATES

a. Redemption of 15,00,000 preference shares

In the matter of Daiichi Sankyo Company Limited vs. Malvinder Mohan Singh & Others (Petition O.M.P. (EFA) (COMM) NO. 6 OF 2016), the interim application having I.A. No. 16727/2018 filed by REL disputing its liability as a garnishee came up for hearing on December 7, 2018. REL has not redeemed 15,00,000 preference shares due for redemption on October 31, 2018 (Redemption value ofर 4,190.28 lakhs) and disputed the liability stating the transaction to be a sham one. The Honble High Court of Delhi directed REL to file an affidavit disclosing the names of persons who were on its Board of Directors and were managing its affairs when the alleged sham transaction was executed. It also remarked that it expected REL to file a complaint with the concerned Police Station. Accordingly, in compliance thereof, REL has filed an affidavit disclosing names of persons who were on Board of Directors at relevant times and has also filed a criminal complaint on March 22, 2019 with the Economic Offences Wing, Delhi Police against Mr. Malvinder Mohan Singh, Mr. Shivinder Mohan Singh, Mr. Sunil Godhwani, RHC Holding Private Limited, Oscar Investments Limited, RHC Finance Private Limited and their other associates for various offences under the Indian Penal Code, I860 including the offences of cheating, criminal breach of trust, criminal misappropriation, forgery, forgery for the purposes of cheating and criminal conspiracy w.r.t transactions relating to issuance and redemption of preference shares.

b. Put option by Non-Resident Shareholders of Religare Finvest Limited ("RFL")

During the year ended March 31,2018, non-resident shareholders of RFL, a subsidiary of the Company, subsequent to exercise of put option for a consideration as per the Option Agreement had filed petitions under Section 9 of the Arbitration and Conciliation Act before the Honble Delhi High Court praying for interim reliefs including by way of a bank guarantee for the said amounts in order to secure their interests. The next hearing in the case has been scheduled for August 21,2019. The parties are currently in advance stage of negotiation to resolve this matter. The Company is not anticipating any material financial impact ofthese negotiations on the financial statement.

On January 5, 2018 the High Court passed an order stating that the status of FDR of र 750 crores approx, of the respondent company lying with Laxmi Vilas Bank Limited be maintained as unencumbered and not be encashed. The subject deposit was liquidated by LVB against certain loans disbursed by LVB to third parties, and the said dispute is under litigation before Honble Delhi High Court.

c. Petition by Axis Bank Limited in matter of Religare Capital Markets International (Mauritius) Limited

Axis Bank has filed an original application ("OA") before the DRT-II, Delhi for recovery of approx. र 31,300 lakhs under a facility agreement between Axis Bank and Religare Capital Markets International (Mauritius) Limited ("RCMIML"), which is inter-alia secured by security provided by Promoters and Religare Capital Markets Limited. REL has neither provided any security/guarantee in relation to the facility nor has any obligation to repay the dues of RCMIML. REL has been made a party to the proceedings based on a Non-Disposal Undertaking ("NDU"). The DRT has passed an order dated March 21,2018 directing inter-alia that REL shall not alienate or create any encumbrance in respect of certain assets and its shareholding in any company or business concerns to the extent of claimed amount and enter into any settlement with any creditors without the prior approval of DRT. REL has filed 2 applications on May 8, 2018 for deletion of REL as a party and vacation of the stay order dated March 21, 2018 against REL. Axis Bank has filed the reply. On December 18, 2018 DRT dismissed both the applications. REL has filed an appeal before the DRAT against the order dated December 18, 2018 which is listed on August 13, 2019. REL has now filed written statement in the OA. Now the matter is listed for Evidence by way of Affidavit. Axis Bank also filed an application for restraint of transfer of RFL to TCG Advisory Services Pvt Limited. Reply to the said application has been filed.

d. Petition against the Company for winding up

M/s. Roto Power Private Limited ("RPPL") filed a winding up petition no. 150/2016 against Religare Support Services Limited ("RSSL"), formerly known as (REL Infrafacilities Limited) on December 17, 2015 alleging recovery of र 72,05,937 (Rupees Seventy Two Lakhs Five Thousand Nine Hundred Thirty Seven Only) which RPPL claims to be due for payment for services provided by it under agreements/arrangement between the RPPL and RSSL. RSSL invoked arbitration against RPPL under a service provider agreement entered into between RPPL and RSSL for an aggregate claim amount of र 109 Lakhs. RSSL got merged into the Company w.e.f December 29, 2017 pursuant to Merger Scheme pursuant to which the winding up petition referred to above was being continued against the Company. The matter been settled by the parties by virtue of the settlement agreement dated Feb 11, 2019 and necessary accounting impact has been considered in the financial statements ofthe Company.

e. Arbitration proceedings in relation to the Health Insurance business

On April 9, 2017, your Company had entered into definitive agreements with a consortium of investors led by True North, an India based private equity fund (formerly known as India Value Fund Advisors) to divest its entire stake in its subsidiary, Religare Health Insurance Company Limited. On January 11,2018, your Company entered into a supplemental agreement and deed of novation for increase in the consideration and extension of long-stop date, among other changes in certain terms and conditions of sale. Certain conditions precedent including regulatory and third party approvals were not received till the extended long-stop date triggering automatic termination of the agreement. In March 2018, certain parties of the buyer consortium filed a petition under Section 9 of the Arbitration and Conciliation Act, 1996, in the Delhi High Court seeking ad interim injunctive relief including towards extension of the Long-Stop Date, and also invoked arbitration under the definitive agreement. The Honble Delhi High Court, in May 2018, dismissed the petition seeking interim relief and directed the petitioners to proceed with arbitration. The arbitration tribunal has been constituted by LCIA. However, arbitration proceedings have not commenced since the parties have not placed a fee deposit with the LCIA yet.

f. Petition for removal of Statutory Auditors of the Company

M/s. Loancore Servicing Solutions Pvt Limited has filed a petition before the Honble NCLT, Delhi seeking removal of auditors. It is currently being contested on grounds of maintainability as the plaintiff is not a concerned person as defined in the Companies Act, 2013 ("Act") for the purposes of filing a petition under Section 140 of the Act for removal of auditors. The matter is currently sub-judice. The Board and management strongly believe that this is a frivolous petition by Loancore and the Company will strongly defend the case.

g. Petition for rectification of Register of Members of the Company

M/s. Loancore Servicing Solutions Pvt Limited has filed a petition with the Honble NCLT, Delhi under Sections 58 and 59 of the Companies Act, 2013 seeking rectification of Register of Members of the Company. The Company is contesting the same on maintainability of the petition. The matter is currently sub-judice. The Board and management strongly believe that this is a frivolous petition by Loancore and the Company will strongly defend the case.

EQUITY SHARE CAPITAL

The current Authorized Share Capital ofthe Company is र 816,45,00,000/- (Rupees Eight Hundred Sixteen Crores Forty Five Lakhs only) divided into 65,44,50,000 (Sixty Five Crores Forty Four Lakhs and Fifty Thousand) Equity Shares ofर 10/- (Rupees Ten only) each and 16,20,00,000 (Sixteen Crores Twenty Lakhs) Redeemable Preference Shares ofर 10/- (Rupees Ten only) each.

During the year under review, the issued, subscribed and paid up equity share capital of the Company was increased from र 178,45,52,480/- (Rupees One Hundred Seventy Eight Crores Forty Five Lakhs Fifty Two Thousand Four Hundred and Eighty only) consisting of 17,84,55,248 (Seventeen Crores Eighty Four Lakhs Fifty Five Thousand Two Hundred and Forty Eight) Equity Shares of र 10/- (Rupees Ten only) each to र 216,94,27,330 (Rupees Two Hundred Sixteen Crores Ninety Four Lakhs Twenty Seven Thousand Three Hundred and Thirty only) consisting of 21,69,42,733 (Twenty One Crores Sixty Nine Lakhs Forty Two Thousand Seven Hundred and Thirty Three only) equity shares ofर 10/- (Rupees Ten only) each.

The issued, subscribed and paid up equity share capital as on March 31, 2019 is र 216,94,27,330/-.

During the financial year under reporting, the Company raised funds as stated in the para "Issue of Warrants" under "Major Events" section above under preferential issue of convertible warrants. The Company had fully utilized the funds received from the warrant holders as per the Objects stated in the Explanatory Statement to the Notice dated February 19, 2018 sent to shareholders ofthe Company. There were no unutilized funds underthe same as on March 31,2019.

PREFERENCE SHARE CAPITAL

The Company has two types of Preference shares issued to the Promoter group companies outstanding as on date comprising 15 lakhs 13.66% Cumulative Non-Convertible Redeemable Preference Shares of 10/- each issued in 2008 (2008 Preference Shares) and 2.5 crores 0.01% Non-Cumulative Non-Convertible Redeemable Preference Shares ofर 10/- each issued in 2016 (2016 Preference Shares).

The Company didnt redeem the 2008 Preference Shares on due date of October 31,2018 basis the interim application filed before the Honble High Court of Delhi praying among other reliefs for the stay of redemption pending the outcome of investigations into the affairs ofthe Company and its subsidiaries already initiated by SEBI and SFIO.

Further, due to non-payment of dividend by the Company continuously for two years on 2016 Preference Shares, the holder of these shares has become entitled forvoting rights ofapprox. 10% on the total voting capital ofthe Company.

However, the Company has filed the petition before the Honble National Company Law Tribunal, New Delhi Bench on June 14, 2019 seeking rectification of Register of Members of the Company by cancellation of 2016 Preference Shares and any other appropriate reliefs, including interim relief with respect to freezing of voting rights and dividend rights attached to the said 2016 Preference Shares.

The said application / petition were filed by the Company basis certain facts discovered by the new management relating to irregularity / illegality in issuance of said Preference Shares.

NON-CONVERTIBLE DEBENTURES

There are no outstanding non-convertible debentures as on date.

PUBLIC DEPOSITS

Your Company has neither invited nor accepted any deposits from public within the meaning of Section 73 of the Companies Act, 2013 read with Companies (Acceptance of Deposits) Rules, 2014 during the period under review.

ANNUAL RETURN

As per the requirements of Section 92(3) ofthe Companies Act, 2013 read with Rules framed thereunder, the Annual Return extract in prescribed Form No MGT 9 is being uploaded on website ofthe Company and can be accessed through the link https://www.religare.com/Annual-Returns.aspx

CAPITAL ADEQUACY

Your Company is registered with the Reserve Bank of India ("RBI")1 as a Non-Deposit Taking Systemically Important Core Investment Company ("CIC-ND-SI") vide Certificate No. N-14.03222 dated June 03, 2014. The Company primarily functions as an investment holding company with more than 90% of its total assets consisting of investments in shares of subsidiary companies/joint venture companies.

As a CIC-ND-SI, the Company is required to -

a. maintain minimum Adjusted Net Worth of 30% of its aggregate risk weighted assets on balance sheet and risk adjusted value of off-balance sheet items as on the date of the last audited balance sheet as at the end of the financial year; and

b. restrict the outside liabilities up to 2.5 times of its Adjusted Net Worth as on the date of the last audited balance sheet as at the end of the financial year.

The Company is in compliance with the abovementioned requirements as at March 31,2019.

However, as mentioned elsewhere in this report, the Company received the supervisory concerns / advisory letter dated April 05, 2019 from the RBI w.r.t. the inspection ofthe Company for the financial position as on March 31, 2018 carried in the month of July 2018 under Section 45N of the RBI Act, 1934. In the supervisory concerns, as per the RBIs assessments / calculations, the regulatory minimum Adjusted Net Worth to Risk Weighted Assets Ratio of the Company is below 30% and RBI has advised the Company to take corrective measures in form of required capital infusion by June 30, 2019. The Company has submitted its reply stating compliance of minimum Adjusted Net Worth to Risk Weighted Assets Ratio of 30% with the RBI.

 

1 RBI Disclaimer: (a) Reserve Bank of India does not accept any responsibility or guarantee about the present position as to the financial soundness of the company or for the correctness of any of the statements or representations made or opinions expressed by the company and for discharge of liability by the company; (b) Neither is there any provision in law to keep, nor does the company keep any part of the deposits with the Reserve Bank and by issuing the Certificate of Registration to the company, the Reserve Bank neither accepts any responsibility nor guarantee for the payment ofthe public funds to any person/body corporate.

RELIGARE EMPLOYEES STOCK OPTION SCHEMES

Nomination and Remuneration Committee ("Committee") of the Board of Directors of the Company, inter-alia, administers and monitors the Employees Stock Option Schemes of the Company in accordance with the Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014 (erstwhile Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999) (‘the SEBI ESOP Regulations).

During the year under review a new Employees Stock Option Scheme called the "Religare Enterprises Limited Employees Stock Option Plan 2019" was introduced for which approval of shareholders of the Company was received on March 29, 2019. Under the said plan 1,62,25,000 stock options have been granted by the Committee till the date ofthis Report.

Details as required under the SEBI ESOP Regulations, for Religare Employees Stock Option Scheme 2010, Religare Employees Stock Option Scheme 2012 and Religare Employees Stock Option Scheme 2019 have been uploaded on the website ofthe Company and can be accessed through the link https://www.religare.com/Employee-Stock-Option- Schemes.aspx

There is no other material change in the ESOP schemes ofthe Company during the year.

Certificate from the Auditors confirming that schemes have been implemented in accordance with the SEBI ESOP Regulations will be placed at the forthcoming Annual General Meeting ofthe Company for inspection by the members.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

All Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149(6)ofthe Actand Regulations 16ofSEBI LODR Regulations.

Following changes occurred in the directorships / key managerial positions (KMP) of the Company during the FY 2018-19:

Sr. Name of Director No. Particulars of Change (Appointment 1 Resignation/Others) Effective Date of change
1. Mr. Ashok Mehta Resigned as Independent Director & appointed as an Interim CEO (without being on the Board) April 17, 2018
2. Mr. P. Vijaya Bhaskar Ceased to be Independent Director of the Company due to sudden and sad demise May 04,2018
3. Ms. Vijayalakshmi Rajaram Iyer Appointed as Non-Executive Independent Director May 08, 2018
4. Mr. Deepak Ramchand Sabnani Resigned as Non-Executive Independent Director May 18, 2018
5. Mr. Malay Kumar Sinha Appointed as Non-Executive Independent Director May 28, 2018
6. Mr. Padam Narain Bahl Resigned as Non-Executive Independent Director June 04, 2018
7. Mr. Rama Krishna Shetty Resigned as Non-Executive Independent Director June 30, 2018
8. Mr. Sushil Chandra Tripathi Appointed as Non-Executive Independent Director August 01,2018
9. Dr. Rashmi Saluja Appointed as Non-Executive Independent Director December 20, 2018
10. Mr. Krishnan Subramanian Ceased to be the Director upon approval of RBI for his resignation March 11,2019
11. Mr. AshokMehta Being Interim CEO, designated as KMP in place of Mr. Krishnan Subramanian May 16, 2018
Stepped down as Interim CEO August 07, 2018
12. Mr. Milind Narendra Patel Appointed as Group CEO and designated as KMP August 07, 2018

Following changes occurred in the directorships / key managerial positions of the Company subsequent to the end of the financial year

Sr. Name of Director No. Particulars ofChange (Appointment / Resignation/Others) Effective Date of change
1. Mr. Gurvinder Singh Juneja Appointed as CFO and designated as KMP April 23, 2019
Resigned as CFO and ceased to be KMP August 08, 2019
2. Dr. Rashmi Saluja Designated as Non-Executive Independent Chairperson of the Company June 19, 2019
3. Mr. Milind Narendra Patel Resigned on June 10, 2019 and ceased to be Group CEO w.e.f. July 19, 2019 July 19, 2019
4. Mr. Siddharth Dinesh Mehta Appointed as Non-Executive Non-Independent Director upon receipt of approval of the RBI July 30, 2019
Designated as Non-Executive Vice Chairperson of the Company August 08, 2019
5. Mr. Ashish Tyagi Appointed as Interim CFO and designated as KMP August 08, 2019

Further, the Board of Directors in its meeting held on November 20, 2018 has also approved the appointment of Dr. Ashwani Mehta as Non-Executive Non-Independent Director, subject to the approval of RBI; the effective date of which was to be the date on which RBI approves the appointment. However, RBI vide its letter dated July 15, 2019 has intimated its non-acceptance to the aforesaid appointment.

As apprised in the last years report, the appointment of Mr. Ashok Mehta and Mr. Siddharth Dinesh Mehta was approved as Non-Independent Directors on the Board subject to the RBI approval and which was to get effective upon the RBI approval. The RBI vide its letter dated December 13, 2018 has communicated that the Companys request for appointing Mr. Ashok Mehta and Mr. Siddharth Dinesh Mehta as Non-Executive Non-Independent Directors cannot be acceded to. The Company vide letter dated December 27, 2018 requested RBI for re-consideration of its application. In its letter dated July 15, 2019, RBI communicated its non-acceptance to the appointment of Mr. Ashok Mehta also as Director. The approval of RBI was received for appointment of Mr. Siddharth Dinesh Mehta as Non-Executive Non-Independent Director on the Board of the Company vide letter dated July 30, 2019.

Dr. Rashmi Saluja and Mr. Siddharth Dinesh Mehta (being additional directors) hold office up to the date of the ensuing Annual General Meeting. The Company has received requisite notices in writing from member(s) of the Company proposing the candidatures of Dr. Rashmi Saluja, Independent Director and Mr. Siddharth Dinesh Mehta, Non-Independent Director. Further, they are not disqualified from being appointed as Directors as specified in terms of Section 164 of the Act.

Brief resume and other details relating to the directors, who are to be appointed/ re-appointed as stipulated under Regulation 36(3) of the SEBI LODR Regulations and Secretarial Standards issued by ICSI, are furnished in the Notice of Annual General Meeting forming part of the Annual Report. Further, in the opinion of the Board Dr. Rashmi Saluja qualifies the criteria of Independent Director as mentioned in the Act and SEBI LODR Regulations and is independent of the management.

BOARD EVALUATION

Pursuant to the provisions of the Act and SEBI LODR Regulations, the Board is required to carry out an annual performance evaluation of its own performance, the performance of the directors individually as well as the evaluation of the working of its Committees.

The performance evaluation of the members of the Board, the Board level Committees and Board as a whole was carried out on May 22 and May 23, 2019 as per the Board evaluation policy of the Company. The manner in which evaluation has been carried out and criteria of evaluation has been explained in the Corporate Governance Report.

REMUNERATION POLICY

Remuneration Policy formed by the Board on the recommendation of the Nomination and Remuneration Committee is in place for selection and appointment of Directors, Key Managerial Personnel and their remuneration as well as policy on other employees remuneration. The Remuneration Policy is stated in the Corporate Governance Report. The relevant Policy(ies) have been uploaded on the website of the Company and can be accessed through the link https://www.religare.com/Policies.aspx

BOARD/COMMITTEE COMPOSITION AND MEETINGS

A calendar of meetings is prepared and circulated in advance to the Directors. The details of composition of Board and Committees and their meetings held during the year are given in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under the Act and the SEBI LODR Regulations.

CORPORATE SOCIAL RESPONSIBILITY INITIATIVES

In compliance with Section 135 of theAct read with the Companies (Corporate Social Responsibility Policy) Rules, 2014, the Company has established a Corporate Social Responsibility ("CSR") Committee. The CSR Committee has formulated and recommended to the Board, a CSR Policy indicating the activities to be undertaken by the Company, which has been approved by the Board. The strategic intent was to adopt a unified cause across the Religare Group and hence the CSR policy and program to be supported was cascaded across all Group entities.

The belief and philosophy of the group is that being a responsible corporate citizen, it would strive to bring about overall positive impact in societies/local communities.

Earlier, the group had engaged the Fortis Charitable Foundation ("FCF") as its implementation partner to pursue and drive the identified agenda/programs. However, during the financial year under review, the Board of Directors reviewed the engagement with FCF and decided to terminate the same. Considering the financial position of the Company and due to losses in Religare Finvest Limited, one of the major CSR contributors in the group in past few years, no new agency has been appointed thereafter for undertaking the CSR activities of the group.

For the year ended March 31, 2019, the Company was not required to spend amount under CSRfor FY 2018-19 as prescribed under Section 135 of the Act.

Annual Report on CSR in the format prescribed in Companies (Corporate Social Responsibility Policy) Rules, 2014 is attached as "Annexure A".

AWARDS & RATINGS

The company and its subsidiaries have received the following awards and recognitions during the period under review - AWARDS

• Religare Health Insurance Company Limited:

i. ‘Best Health Insurance Company ofthe Year - Emerging Asia Insurance Awards 2019

ii. ‘Indias Most Preferred Health Insurance Brand - Indias Most Preferred Smart City Brands 2018-19

iii. ‘Indias Best Travel Insurance Product - India Travel Awards 2018

iv. ‘Health Insurance Category Award - FICCI Healthcare Excellence Awards 2018

v. ‘Bancassurance Leader of the Year - Insurance India Summit & Awards 2018

vi. ‘Best Claims Service Provider of the Year - Insurance India Summit & Awards 2018

vii. ‘Indias Most Preferred Travel Insurance Productfor the Product - Explore by Indias Most Preferred Travel & Tourism Brands 2018

viii. ‘Skoch Award in the Micro Insurance Bronze Category 2018 for ‘Grameen Swaasthya Suraksha

• Religare Commodities Ltd. : ‘Best Broking House - Bullion - MCX Awards 2019

• Religare Broking Ltd. : ‘Regional Retail Memberofthe Year-North- NSE Market Achievers Awards2018 RATINGS

In November 2018, ratings for following specific issuances of the Company from India Ratings & Research Private Limited (‘Ind-Ra, a Fitch Group Company) were revised as below:

• The Companys र 176 cr. secured redeemable non-convertible debentures (NCDs): "IND BBB-/ Rating Watch Negative" was withdrawn.

• The Companys Short Term Debt Facility/Commercial Paper of र 50 cr.: "IND A3/ Rating Watch Negative" was revised to "Ind A4+/RWN.

Ind-Ra has stated that the revision in the ratings of the Company is inter-alia on account of downgrade of credit rating of Religare Finvest Limited ("RFL), subsidiary Company. Credit rating revision is a reflection of RFLs reduced ability to provide support in view of its operational and financial challenges. Ind-Ra believes that the Companys long term support expectation from RFL, which formed main premise of rating linkage, has considerably reduced. The Company has not received dividends from RFL in FY 2017 & 2018. Ind-Ra has also noted that during the 12 months ended October 2018, the Company has repaid substantial part of its debt obligations, while has further simplified the group structure through merger of certain group companies within itself.

Further, the aforesaid existing rating of "Ind A4+/RWN for Companys Short Term Debt Facility/Commercial Paper of र 50 cr. was also withdrawn in January 2019 as there was no outstanding facility against the same.

The Company has no outstanding NCDs and Commercial Papers as on March 31, 2019 or thereafter till the date of adoption of this report.

LISTING ON STOCK EXCHANGES

The Equity Shares of the Company are listed on National Stock Exchange of India Limited and BSE Limited. The annual listing fees for the year 2019-20 have been paid to both the Stock Exchanges.

STATUTORY DISCLOSURES

None of the Directors of your Company is disqualified as per provision of section 164(2) of the Act. The Directors of the Company have made necessary disclosures, as required under various provisions of the Act and the SEBI LODR Regulations.

CONSOLIDATED FINANCIAL STATEMENTS

As required under the Regulation 34 of SEBI LODR Regulations and Section 129(3) of the Act, consolidated financial statements of the Company and its subsidiaries are attached to the Annual Report. The consolidated financial statements have been prepared in accordance with Indian Accounting Standard lnd-AS-103, "Business Combination" and Ind AS- 110 "Consolidated Financial Statements" issued by The Institute of Chartered Accountants of India and notified by the MCA. The audited consolidated financial statements together with Auditors Report forms part of the Annual Report.

The Company although holds 100% equity share capital in Religare Capital Markets Limited ("RCML"), however in the present scenario controlling through voting rights of RCML is not there with the Company. Beside this, the tripartite agreement entered into, in financial year 2011-12, between REL, RCML and RHC Holding Private Limited ("RHCHPL"), a promoter group company for providing financial support to RCML by RHCHPL (by subscribing Preference Shares of RCML) severe long term restrictions and significant restrictive covenants on major decision making at RCML were imposed by the holder of preference shares. Accordingly in view of the above, the financial statements of RCML and its subsidiaries have been excluded from the consolidated financial statements of the Company w.e.f. October 01, 2011, in accordance with applicable accounting standards. The Company has already provided fully for the entire investment made by it into RCML in previous years.

Therefore, the Consolidated Financial Statements presented by your Company, including financial information of all its subsidiaries, excluding RCML and RCMLs subsidiaries, have been duly audited by the Statutory Auditors and the same is published in your Companys Annual Report.

CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION

Even though operations of the Company are not energy intensive, the management has been highly conscious of the importance of conservation of energy and technology absorption at all operational levels and efforts are made in this direction on a continuous basis. In view of the nature of activities which are being carried on by the Company, the particulars as prescribed under Section 134(3)(m) of the Act read with Rule 8 of the Companies (Accounts) Rules, 2014 regarding conservation of energy and technology absorption are not applicable to the Company and hence have not been provided.

FOREIGN EXCHANGE EARNINGS AND OUTGO

The Company has incurred expenditure of र 43.86 Lakhs (previous year: र 123.86 Lakhs) in foreign exchange and earned Nil (previous year: nil) in foreign exchange during the year under review on a standalone basis.

MAINTAINANCE OF COST RECORDS

The Company is in the financial services industry. In view of the nature of activities which are being carried on by the Company, the maintenance of cost records as specified by the Central Government under sub-section (1) of section 148 of the Act is not applicable on the Company and hence such accounts and records are not maintained.

TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND

No amount was required to be transferred by the Company to the Investor Education and Protection Fund during the financial year under reporting.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 134(5) of the Act, the Board of Directors, to the best of their knowledge and ability, confirm that:

(a) in the preparation of the annual financial statements for the year ended March 31, 2019, the applicable accounting standards have been followed along with proper explanation relating to material departures ;

(b) they have 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 financial year and of the loss of the Company for that period;

(c) they have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(d) they have prepared the annual accounts on a going concern basis ;

(e) they have laid down internal financial controls to be followed by the Company and such internal financial controls are adequate and operating effectively; and

(f) they have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

CORPORATE GOVERNANCE

The Company is committed to uphold the high standards of Corporate Governance and adhere to the requirements set out by the Securities and Exchange Board of India.

The Companys Board has taken various steps to enhance the corporate governance and compliance at group level which encompasses from change in top management including appointment of senior officials at REL level to re-organization of Boards ofsubsidiaries of the Company.

A detailed report on Corporate Governance along with the Certificate of M/s Sanjay Grover & Associates, Company Secretaries regarding compliance with conditions of Corporate Governance as stipulated in Part C of Schedule V of the SEBI LODR Regulations forms integral part ofthis Report.

AUDITORS

M/s S.S. Kothari Mehta & Co., Chartered Accountants, (Firm Registration No. 000756N), were appointed as statutory auditors of the Company by the shareholders at the 33rd Annual general Meeting of the Company ("AGM") held on September 21,2017, to hold office for a period of five consecutive years commencing from the financial year 2017-18 i.e. from the conclusion of 33rd AGM until the conclusion of the 38th AGM to be held in the year 2022 (subject to the ratification of appointment at every AGM as per provisions of Section 139(1) of the Act).

However, in accordance with the Companies Amendment Act, 2017, enforced on May 07, 2018 by Ministry of Corporate Affairs, the appointment of Statutory Auditors is not required to be ratified at every Annual General Meeting.

AUDITORS REPORT

The Reports given by the Auditors on the financial statements of the Company form part of this Annual Report. The Management response on the Statutory Auditors Qualification / Comments on the Companys standalone financial statements and consolidated financial statements is as below:

Managements response on the Statutory Auditors Qualification / Comments on the Companys standalone financial statements:

a. Qualification pertaining to non-redemption of Preference Shares by the Company due for redemption

on October 31, 2018, in the Auditors Report: The Company has not redeemed 15,00,000 preference shares due for redemption on October 31, 2018 (Redemption value ofर 4,190.28 lakhs) and disputed the liability stating the transaction to be an illegal one by filing the interim application having I.A. No. 16727/2018 in the matter of Daiichi Sankyo Company Limited vs. Malvinder Mohan Singh & Others (Petition O.M.P. (EFA) (COMM) NO. 6 OF 2016). The Company has already accounted for the redemption value of र 4,190.28 lakhs in its financial statements. Since the matter is sub- judice, the management cannot determine the amount of any additional liability at this point of time, if any, which may arise due to non-redemption of said preference shares.

b. Qualification pertaining the process for updating the documentation for Micro Small & Medium Enterprises as per MSMED Act 2006, in the Report on Internal Financial Controls: The Company has initiated the process and have identified the substantial vendors under the MSMED Act, 2006 during the year under review and same is proposed to be completed in the quarter ending September 30, 2019.

Managements response on the Statutory Auditors Qualification / Comments on the Companys consolidated financial statements

a. Qualification pertaining to Lakshmi Vilas Bank adjusting the fixed deposits of Religare Finvest Ltd., subsidiary of the Company (RFL): RFL had filed a suit for recovery of amounts misappropriated by the Lakshmi Vilas Bank ("LVB") placed as Fixed Deposits with it on May 31, 2018 before the Honble Delhi High Court. The Honble High Court was pleased to pass interim Orders directing that status quo be maintained in respect of RFLs current account maintained with LVB.

It is pertinent to mention here that LVB has sought to delay the adjudication of the interim reliefs and the suit for recovery sought by RFL by filing multiple applications, all of which have been kept in abeyance by the Honble Court till such time RFLs applications for interim reliefs are disposed of. The pleadings in the matter are now complete, in as much as LVB has filed a reply to RFLs suit and RFL has filed its rejoinder to the same. LVB has further filed a sur rejoinder to the rejoinder filed by RFL. Strategic Credit Capital Private Limited and Participation Finance and Holdings (India) Pvt Limited have filed applications to be impleaded in the matter, which are yet to be adjudicated on by the Honble Court. The case has been fixed for arguments on interim applications filed by RFL for various dates since July 19, 2018 till March 11,2019. On March 11, 2019 arguments were addressed at length by the counsel of Plaintiff. The Honble Court was pleased to reserve order on the interim application on April 12, 2019.

Thereafter, LVB filed another application placing ex-parte SEBI order dated March 14, 2019 on record. RFL filed affidavit pursuant to the order dated April 9, 2019 passed by the Honble High Court of Delhi along with the reply qua the ex-parte interim orderofthe SEBI dated March 14, 2019 and letters addressed to RBI & NHB.

RFL has now filed an amendment application seeking amendment of plaint before the Honble High Court of Delhi on which notice has been issued for August 23, 2019.

Apart from the civil suit for recovery RFL has also filed a criminal complaint against LVB and other accused persons on May 15, 2019 before the Economic Offences Wing, Delhi which is under investigation.

b. Qualification pertaining to Corporate Loan Book of Religare Finvest Ltd., subsidiary of the Company (RFL): RFL has an exposure of र 203,670 Lakhs as per financials as at March 31,2019 towards the Corporate Loan Book. RBI has raised concerns in the past about the credit worthiness of the borrowers, credit appraisal and loan sanctioning mechanism followed by RFL in respect of this book. The management has reviewed the portfolio and the financial reports of the borrowers to determine the recoverability of the said loans. Based on the maturity dates of the loans, recovery steps instituted and the financial reports of the borrowers, RFL had, on a prudent basis, made full provision ofर 203,670 Lakhs as at March 31,2019 against this portfolio.

A law firm of repute was appointed to undertake a detailed diligence on this loan book and the said diligence has been completed. Insolvency proceedings have been initiated before the NCLT Delhi and Kolkata against the Borrowers forming a part of the Corporate Loan Book. The Insolvency Petitions filed before the NCLT, New Delhi were listed on March 27, 2019for addressing arguments for the admission of petitions.

Arguments were heard at length on the said date and the Honble NCLT was pleased to reserve its order and requested the counsels for all the parties to file their written submissions. Order reserved for admission but the Proceedings are stayed by Supreme Court vide order 05.04.2019. Based on the due diligence report and the replies filed by the borrowers before the NCLT, RFL had also filed a criminal complaint before the EOW, Delhi, on which a F.I.R. no. 50/2019 has been registered and is under investigation.

Whereas, the insolvency petition titled as "Religare Finvest Limited vs. Bharat Road Network Limited" filed before the NCLT, Kolkata was listed for admission hearing on March 29, 2019. The corporate debtor/borrower has filed its reply on the last date of hearing i.e. 18-Jul-19 to which RFL has to file its rejoinder. The matter is posted for admission hearing on August 19, 2019

During the yearended March 31,2019, there is no movement in this portfolio.

c. Qualification pertaining to increase in rates by some of the lenders and not creating provision for the increased rate by Religare Finvest Ltd., subsidiary of the Company (RFL): RFL has raised the concern and is perusing with the banks for restoring the contractual Rate of Interest. RFL has not made the provision of increased amount of Interest amounting to र 2,898.47 lakhs, but has shown the same as contingent liability in the financial statements.

d. Qualification pertaining to sale of GNPA of र 3,038.13 lakhs for a value of र 2,278.60 lakhs to a Trust for security receipt as a consideration by Religare Housing Development Finance Corporation Ltd., subsidiary of RFL (RHDFCL): Sale of GNPA to Reliance ARC is concluded within the RBI purview and the RHDFCL has obtained true sale opinion for concluding the transaction. Accordingly, RHDFCL has derecognized the NPA loan receivables and has recognized security receipts as investments in the books of accounts. RHDFCL shall recognize profit/ loss on the Security Receipts based on the evaluation by independent rating agency as stipulated under RBI Regulation. Under IND-AS, the security receipts issued by the trust would full-fill the criteria for a financial asset and has been recognized in its books.

e. Qualification pertaining to increase in rates by some of the lenders and not creating provision for the increased rate by RHDFCL: In previous year because of rating downgrade lenders have arbitrarily increased the interest rate and RHDFCL has requested for the reversal of such increase in rates. Banks have placed RHDFCL request to the appropriate authority for such reversal. Therefore, RHDFCL has not recognized as interest expenses and shown as contingent liability.

Managements response on the Statutory Auditors Qualification / Comments on the Companys consolidated report on Internal Financial Controls pertaining to RFL:

(i) Material weakness in Internal Financial Control over Financial Reporting in the Credit evaluation process in respect of Corporate Loan Book and loan against property & shares;

As apprised in the last years report as a strategy, RFL management has decided not to extend any further loans under Corporate Loan Book and loan against shares. Further, adequate controls exist for loans granted under Loans against property (SME-Secured Loans) and Loans against shares. Further, since RFL is under corrective action plan of RBI since January 2018, no fresh loan has been disbursed during the year under reporting and hence controls in respect of these processes were not tested during the year.

(ii) Updated documentation for Micro Small & Medium Enterprises as MSMED Act 2006; During the year under review, RFL has taken steps for updating its documentation for Micro, Small and Medium Enterprises as per MSMED Act, 2006 which is expected to be completed this year.

(iii) Strengthening of control over Information Technology General Controls: RFL management has implemented corrective actions in the Controls over Information Technology General Controls during the year under review. However, certain controls need to be further strengthened particularly in respect of access rights management and IT assets management for which adequate steps are being taken by the Management.

SECRETARIAL AUDITORS REPORT

As per provisions of Section 204 of the Act, the Board of Directors of the Company has appointed M/s P I & Associates as the Secretarial Auditor of the Company to conduct the Secretarial Audit. The Secretarial Audit Report for the financial year ended March 31, 2019, is annexed to this Report. Management comments on qualifications given by auditors in the report are as follows:

(a) Non-compliance with Secretarial Standards issued by The Institute of Company Secretaries of India:

The Company has complied with Secretarial Standards except in few cases where minutes were circulated

to the Board members beyond prescribed timelines due to frequent changes at Board and management level during year under review. The management will take steps to ensure that same is not repeated in future.

(b) Non-submission of audited financial results for the quarter and year ended March 31, 2018 within the sixty days: The meeting of Board of Directors to consider and approve the audited financial results for the quarter and year ended March 31, 2018 was held on May 30, 2018. The Board meeting commenced at 10:30 a.m. on May 30, 2018 and ended at 2.30 a.m. on Thursday, May 31, 2018. Consequently, the Company could upload the results only after the closure of Board meeting (in next 30 minutes of closure of the Board meeting) which resulted in delay of approx. 3 hours in submission of financial results to the exchanges. The Company represented before the exchanges for condoning the marginal delay of approx.. 3 hours in submission of results which was acceded to by the NSE while no further communication was received from BSE on same.

(c) Appointment of CFO: The office of CFO became vacant on January 24, 2018. The Company was required to appoint CFO within six months i.e. by July 23, 2018. The Company was looking for the candidates for the CFO position but given the situation of Group and various ongoing investigations, the Company could not fill in the position within prescribed time limit. The Company subsequently appointed Mr. Gurvinder Singh Juneja as Chief Financial Officer with effect from April 23, 2019.

(d) Performance evaluation of the Board in FY 19: The performance evaluation was initiated by the Company during the financial year 2018-19 but same couldnt be completed as the majority of the Board members were newly appointed directors at the time of evaluation and were not in a position to do the evaluation exercise.

(e) Non-approval of a related party transaction with Religare Finvest Limited (RFL), subsidiary company: A

transaction amounting र 131.35 lakhs with RFL was missed for prior-approval of the Audit Committee. The said transaction was in relation to expense reimbursement for the common shared service to RFL which was required to be paid due to shifting of employees of the Company to a new common floor in March 2018 which was owned by the said subsidiary on lease basis. The said transaction was subsequently ratified by the Audit Committee in its meeting held on September 06, 2018.

(f) Non-compliance of Directions relating Master Directions - Information Technology for the NBFC Sector:

The Circular is primarily talking about the NBFCs without any mention of CICs, hence the Company immediately wrote to RBI after the circular came to seek clarification of its applicability on the Company being a CIC.

RBI clarified on the matter only in February 2018 to comply the same. Thereafter, the Company immediately took necessary steps and the Gap Assessment as per RBI requirement has been conducted and the report has already been presented to the Board in May 2018 and the Board was also apprised about RBIs requirements w.r.t. IT framework in its meeting held in May 2018.

Further, thereafter, there were frequent changes at the Board and management level, hence no further decision and action was taken to comply the requirement ofsaid RBI Master Directions.

However, the management and the department heads have internally discussed, evaluated and are in the process of finalization of the said policies and necessary steps are being taken to get the same approved by the Board of Directors. Towards the same, the Company has already constituted the IT Strategy Committee in May 2019.

PARTICULARS OF INVESTMENTS, LOANS AND GUARANTEES

The Company, being an NBFC, is exempted from the provisions of Section 186 [except sub-section (1)] of the Act. Accordingly, details of particulars of loans, guarantees or investments as required to be provided as per Section 134(3)(g) of the Act are not provided.

RELATED PARTY TRANSACTIONS

All related party transactions that were entered into during the financial year were on an arms length basis and were in the ordinary course of business. There are no materially significant related party transactions entered by the Company with related parties which may have a potential conflict with the interest of the Company.

All Related Party Transactions are placed before the Audit Committee for approval as per the Related Party Transactions Policy of the Company as approved by the Board. The policy is also uploaded on the website of the Company & can be accessed through the link https://www.religare.com/pdf/Related_party_Transaction_Policy_02042019.PDF

Since all related party transactions that were entered into during the financial year were on an arms length basis and were in the ordinary course of business and there was no material related party transaction entered by the Company during the year

as per Related Party Transactions Policy, no details are required to be provided in Form AOC-2 prescribed under clause (h) of sub-section (3) ofsection 134 ofthe Act and Rule 8(2) ofthe Companies (Accounts) Rules, 2014.

The details of the transactions with related parties are provided in the notes to accompanying standalone financial statements. RISK MANAGEMENT

The Board of Directors of the Company has constituted a Risk Management Committee, which is responsible for framing, implementing, monitoring and periodically review the effectiveness of the risk management plan and make appropriate changes as and when necessary. The details ofthe Committee are set out in the Corporate Governance Report forming part of the Annual Report.

The Company / REL is not an operating company and therefore major risk lies with management and operation of its subsidiary / group companies. The Company being an investment holding company, has a comprehensive Risk Management framework and overarching Risk Management policy, which is adopted by each of the key subsidiaries while formulating their Risk Policy. Risk Management Policy is aimed at identification, evaluation, mitigation, monitoring and reporting of identifiable risks. Respective functional head and/or risk management department of subsidiaries are responsible for implementation ofthe Risk Management system and maintenance of record of risk and mitigation plan in Risk & Control Matrix (RCM), which is tested and updated periodically. Therefore, the risk framework defines the risk management approach across the enterprise at various levels including documentation and reporting. The framework has different risk models which help in identification of risks and their classification in High, Medium and Low categories on the basis of likelihood, impact and velocity. .

The subsidiary companys Risk Management Committee authorized by the respective Board, or in its absence the respective Audit Committee, reviews the risk management policy and appropriateness of systems and controls in this regard and submits its report to the Risk Management Committee of your Company on periodical basis.

VIGIL MECHANISM/ WHISTLE BLOWER POLICY

The Company has a vigil mechanism named Whistle Blower Policy to deal with instance of unethical practices, fraud and mismanagement, actual or suspected fraud or violation of the Companys code of conduct or ethics policy and any leak/suspected leak of Unpublished Price Sensitive Information or gross misconduct by the employees of the Company, if any, that can lead to financial loss or reputational risk to the organization. The detail ofthe Whistle Blower Policy has been posted on the website of the Company & can be accessed through the link https://www.religare.com/ Policies.aspx

During the year under review, no complaint pertaining to the Company was received under the Whistle Blower mechanism. INTERNAL FINANCIAL CONTROLS AND INTERNAL CONTROL SYSTEM

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 comprehensive agreement with the internal audit agency, which is reviewed and approved by the Audit Committee of the Company and its respective subsidiaries. The Company has appointed M/s KPMG as the Internal Auditor of the Company as approved by the Audit Committee. KPMG also assist the Company and its key subsidiaries in testing and reporting of Internal Financial Controls (IFC) on quarterly basis through an integrated system of internal audit and IFC testing. To maintain its objectivity and independence, the Internal Auditor agency directly reports to the Audit Committee.

The Internal Auditor evaluates the efficacy and adequacy of the internal control system and internal financial controls in the Company, its compliance with operating systems, accounting procedures, policies and regulatory requirements at all locations of the Company and its subsidiaries. Based on the integrated report of internal audit function and IFC, process owners undertake corrective action in their respective areas and thereby strengthen the internal controls. Significant audit observations and corrective actions thereon along with IFC dashboard are presented to the Audit Committee on periodical basis.

HUMAN RESOURCES

The Company and its subsidiaries have been operating in challenging times. However, in continuation to our dedicated efforts towards rebuilding the Group, we have seen a lot of tangible and positive developments in the Company: induction of credible members in the Board of Directors, increased corporate governance and controls, cost rationalization, closer interaction with regulators and attraction offresh talent.

As the transition of the Company in to this new phase continues, our management and employees are strongly aligned towards building an enabling eco-system to restore high growth and profitability. Employees are our vital and most valuable assets. Over this period, we have developed a strong culture of transparency through constant

employee communication. In order to boost the employee morale, the organization has recognized the commitment, loyalty and contribution of its internal stakeholders. The Company is dedicated to offering its employees favorable work environment and opportunities to navigate through the current period and also influence its future course of direction as planned.

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT THE WORK PLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

The Company has in place an Anti-Sexual Harassment Policy in line with the requirements of The Sexual Harassment of Women at the Work Place (Prevention, Prohibition and Redressal) Act, 2013 and rules made thereunder. An Internal Complaints Committee (ICC) is in place as per the requirements of the said Act to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this policy. No case has been reported during the year under review.

PARTICULARS OF EMPLOYEES

The details required under Section 197(12) of the Act read with Rule 5(1) & 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, are annexed as "Annexure B" to this report.

COMPLIANCE WITH SECRETARIAL STANDARADS

The Board of Directors affirm that except as mentioned in Secretarial Audit Report and Managements response on same, the Company has complied with the applicable Secretarial Standards issued by the Institute of Company Secretaries of India (SS1 and SS2) respectively relating to Meetings of the Board, its Committees and the General Meetings.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

There are no significant or material orders passed by the Regulators/Courts which would impact the going concern status ofthe Company and its operations in future except to the extent mentioned in this Report.

MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION

There are no material changes and commitments adversely affecting the financial position of the Company which have occurred between the end of the financial year of the Company to which the financial statement relate (i.e. March 31,2019) and as of date of the report i.e. August 08, 2019.

ACKNOWLEDGEMENTS

Your Directors would like to express their sincere appreciation for the co-operation and assistance received from the Companys Bankers, Regulatory Bodies, Stakeholders including Financial Institutions and other business associates who have extended theirvaluable sustained support and encouragement during the year under review.

Your Directors also wish to place on record their deep sense of gratitude and appreciation for the commitment displayed by all executives, officers and staff at all levels ofthe Company during the year under review. Your Directors would also like to thank all shareholders for their continued faith in the Company and look forward to your continued support in the future.

By order of the Board of Directors
For Religare Enterprises Limited
Sd 1-
Rashmi Saluja
Non-Executive Independent Chairperson
DIN: 01715298
Place: New Delhi Address: Prius Global, A-3,4,5,
Date: August 08, 2019 Sector - 125, Noida - 201 301