TruCap Finance Ltd Directors Report

In line with the principles of prudent financial management and in compliance with the applicable provisions of the Act, the Company has considered it appropriate to conserve its resources and not declare dividends for the financial year ended March 31, 2025. Retaining earnings during this period will support the Company in maintaining liquidity, strengthening its financial position, and ensuring operational continuity. The Board remains focused on improving business performance and is committed to resuming dividend payouts once the financial position stabilizes and profitability is restored.

During the year under review and till the date of this Report, the Company has allotted 6,350 Listed Non-Convertible Debentures having face value of Rs. 1,00,000/- each total aggregating to Rs. 6,350 Lakhs ("Listed NCDs") on private placement basis and the same are listed on wholesale debt market of BSE. As on the date of this Report, the total Listed Non-Convertible Debentures stood at 11,950 having face value of Rs. 1,00,000/- each total aggregating to Rs. 11,950 Lakhs and 35 unlisted Non-Convertible Debentures having face value of Rs. 1,00,00,000/- each ("Unlisted NCDs") of the Company total aggregating to Rs. 3,500 lakhs.

b. CareEdge B-/Credit Watch with Developing Implication from CareEdge Global IFSC Limited ("CareEdge Global") for the Bonds; and

c. IVR BBB / RWDI (IVR Triple B with Rating Watch with Developing Implications) from Informerics Valuation & Rating Private Limited ("Informerics") for fund based bank facilities and Debentures

Although on June 03, 2025, Informerics reaffirmed its rating of IVR BBB / RWDI (Rating Watch with Developing Implications), however on June 04, 2025, CARE downgraded the ratings of the Company from CARE BBB- to CARE BB+(Unlisted NCDs and Listed NCDs are collectively referred to as ("Debentures")).

Additionally, during the year under review, the Company has availed external commercial borrowings by allotment of 1,000 secured, United States Dollar denominated bonds of face value of USD 10,000 (United States Dollar Ten Thousand only) each, aggregating up to USD 10,000,000 (United States Dollar Ten Million only) ("Bonds"). The Bonds are listed on global securities market platform of India International Exchange (India INX).

During the year under review, the Company has made timely payment of its interest and redemption of principal obligations pertaining to Listed NCDs, Unlisted NCDs and Bonds respectively.

Further, based on loss reported for the financial year ended March 31, 2025, which was largely due to writeoffs taken as a prudent and conservative provisioning and write-off policy of the Company, CARE downgraded the ratings of the Company from CARE BBB- to CARE BB+ (Rating Watch with Developing Implications), on June 04, 2025, resulting in accelerated redemption of the Listed NCDs under 6 ISINs, leading to immediate liquidity requirements in the Company. However, due to non-receipt of committed funds for such accelerated redemption of the Debentures, the Company has not been able to fulfil its obligation towards accelerated repayment of principal and/or interest towards these Debentures on the accelerated due dates. Your Company is committed to honour and fulfil its payment obligations towards the Debentures and has actively taken steps to find a viable solution. Till the date of this Report, the Company has repaid 70% of the total principal obligation on pro-rata basis towards the accelerated repayment of Debentures and is committed to repay the balance 30% of the principal obligation along with the interest on reducing balance towards the Debentures by end of October, 2025.

As on the date of this report, the Company has outstanding Debentures of T 6,318.52 lakhs and outstanding listed Bonds of T 8,404.00 lakhs.

The details of the Debenture Trustee of the Company for the aforesaid Debentures and Bonds are as under:

GDA House, 1^st Floor,

Plot No. 85, S. No. 94 & 95,

Bhusari Colony (Right), Kothrud, Pune - 411 038.

As on March 31, 2025, the total paid up equity share capital of the Company was Rs. 23,37,98,742/- divided into 11,68,99,371 equity shares having face value of Rs. 2/- each. Further, the Board of Directors have at their meeting held on May 26, 2025 approved allotment of 19,62,500 equity shares upon exercise of ESOPs by eligible ESOP holders. Consequently, as on the date of this Report, the paid-up equity share capital of the Company is Rs. 23,77,23,742 comprising of 11,88,61,871 equity shares having face value of Rs. 2/- each.

The movement of equity share capital during the financial year ended March 31, 2025, till the date of this Report is as under:

(Amount in Rs. )

Further, the shareholders of the Company, on recommendation of the Board of Directors of the Company, have amended the capital clause of the Memorandum of Association of the Company. Accordingly, as on the date of this Report, the Authorized Share Capital of the Company stood at Rs. 75,00,00,000/- (Rupees Seventy-Five Crores) comprising of 37,50,00,000 equity shares having face value of Rs. 2/- each.

Further, as on March 31, 2025, 55,74,912 convertible warrants having face value of Rs. 2/- each at an issue price of Rs. 71.75/- each for an aggregate consideration of Rs. 39,99,99,936/- convertible warrants, and as on the date of this Report, additional 65,42,372, convertible warrants having face value of Rs. 2/- each at an issue price of Rs. 73.75/- each for an aggregate consideration of Rs. 48,24,99,935/- issued to non-promoter category on preferential basis stands cancelled since the warrant holder(s) holding these warrants have voluntarily waived their right to exercise conversion of such convertible warrants. Accordingly, as on March 31, 2025, the consideration of Rs. 9,99,99,984/-(representing 25% of the total consideration) received by the Company from the respective warrant holder(s) holding 55,74,912 warrants has been forfeited, and as on the date of this Report, additional Rs. 12,06,24,984 (representing 25% of the total consideration) received by the Company from the respective warrant holder(s) holding 65,42,372 warrants has been forfeited, in accordance with the terms of the warrants and the provisions of Regulation 169(3) of Chapter V of SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2018, as amended ("ICDR Regulations").

Further, the Shareholders of the Company have at its extra ordinary general meeting held on June 25, 2025, upon recommendation of the Board of Directors of the Company, approved raising of funds up to Rs. 206.7 Crores, rounded off, by way of issuance of:

(a) Up to 11,56,80,000 equity shares having face value of Rs. 2/- each, at an issue price of Rs. 9.88/- per share (inclusive of premium of Rs. 7.88/-) aggregating to Rs. 114.1 Crores on preferential basis; and

(b) Up to 9,37,00,000 convertible warrants having face value of Rs. 2/- each, at an issue price of Rs. 9.88/- per warrant (inclusive of premium of Rs. 7.88/-) ("Acquirer Warrants") on preferential basis, convertible into equivalent number of equity shares having face value of Rs. 2/- each at a conversion price of Rs. 9.88/- (Rupees Nine and Paise Eighty-Eight only) per equity share, aggregating to Rs. 92.6 Crores. The Acquirer Warrants can be exercised anytime post completion of four (4) months from the date of allotment but before expiry of 18 (eighteen) months from the date of such allotment of Acquirer Warrants, in terms of ICDR Regulations.

The aforesaid fund raising is subject to regulatory and other corporate approvals and is currently under process.

Since the year ended March 31, 2025, the Shareholders of the Company have, at its extra ordinary general meeting held on June 25, 2025, upon recommendation of the Nomination and Remuneration Committee and the Board of Directors of the Company, approved the cancellation and termination of the below:

i. DFL ESOP Scheme 2021; and

ii. TruCap Employee Retention Plan Public Deposits

The Company is registered with RBI as a Non-Deposit accepting NBFC. Further, pursuant to the provisions of para 2 of the Master Direction - Non-Banking Financial Companies Acceptance of Public Deposits (Reserve Bank) Directions, 2016, as amended, the Board of Directors have confirmed that during the financial year ended March 31, 2025, the Company has not accepted public deposits as defined under the Reserve Bank of India Act, 1934 and will not accept public deposits during the financial year 202526 without prior written approval of RBI.

The Company recognizes that board diversity plays a vital role in driving its success and strengthening governance. A well-balanced mix of executive, non-executive, and independent directors—including an independent woman director—ensures robust oversight and strategic direction. The Boards composition fully complies with the requirements of the Act and Listing Regulations. It comprises highly respected individuals known for their integrity, expertise, and leadership capabilities. In addition to their rich experience and sound financial judgment, the Directors demonstrate strong strategic insight and a deep commitment to the Company, dedicating ample time towards meetings and related responsibilities.

As on March 31, 2025 and as on the date of this Report, the Board of Directors of the Company comprises of the following directors:

During the financial year ended March 31, 2025, and till the date of this Report, there were following changes in the composition of the Board of Directors of the Company:

(a) Ms. Geetu Gidwani Verma (DIN: 00696047), resigned as an Independent Director of the Company, with effect from close of business hours of October 04, 2024 due to her pre-occupations; and

(b) Mr. Rakesh Sethi (DIN: 02420709), Independent Director and Chairperson of the Company, completed his term of 5 (Five) consecutive years on October 14, 2024, and hence with effect from close of business hours of October 14, 2024, he ceased to be the Director of the Company.

All the Directors of the Company have confirmed that they are not disqualified to act as Director in terms of Section 164 of the Act.

The tenure of appointment of Mr. Rohanjeet Singh Juneja as Managing Director and Chief Executive Officer expires on December 16, 2025. Further, the Board of Directors have, on recommendation of the Nomination and Remuneration Committee, approved and recommended to the Members of the Company at the ensuing Annual General Meeting, the re-appointment of Mr. Rohanjeet Singh Juneja (DIN: 08342094) as Manging Director & Chief Executive Officer of the Company for a further period of 3 years starting from December 16, 2025 to December 17, 2028 (both days inclusive), liable to retire by rotation.

In accordance with the provisions of Section 152(6) of the Act, Ms. Rushina Mehta, Non-Executive Non-Independent Director of the Company, is liable to retire by rotation at the ensuing AGM and, being eligible, has offered herself for re-appointment. The Board of Directors of the Company recommends the same for the approval of the Members of the Company.

The notice convening the AGM includes brief information and proposal for re-appointment of Mr. Rohanjeet Singh Juneja as Managing Director and Chief Executive Officer and Ms. Rushina Mehta as Director of the Company.

Pursuant to the provisions of Section 149(7) of the Act, the Independent Director(s) have submitted declarations confirming that they meet the criteria of independence as provided in Section 149(6) of the Act along with rules framed thereunder and Regulation 16(1)(b) of the Listing Regulations. There has been no change in the circumstances affecting the status as Independent Directors of the Company during the financial year ended March 31, 2025.

Further, the Company has obtained the certificate from M/s. U. Hegde & Associates, Practicing Company Secretaries, pursuant to Regulation 34(3) and Clause 10(i) of Para C of Schedule V of the Listing Regulations confirming that none of the Directors on Board of the Company as on March 31, 2025, have been debarred or disqualified from being appointed or continuing as director of the Company by SEBI/MCA or any such statutory authority. The aforesaid certificate is annexed to the Corporate Governance Report which forms part of the Annual Report.

During the financial year ended March 31, 2025, the Board met 6 (Six) times The details of the meeting(s) of the Board of Directors of the Company held during the financial year 202425 and attendance of the Directors are included in the Corporate Governance Report which forms part of the Annual Report.

The Board has various board level committees constituted in accordance with the applicable provisions of the Act and Listing Regulations.

The composition of the Audit Committee as on March 31, 2025 and as on the date of this Report, is given below:

The composition, role, terms of reference and powers of the Audit Committee are in conformity with the requirements of the Act and the Listing Regulations and the same have been provided in the Corporate Governance Report which forms part of the Annual Report.

During the year under review, the Audit Committee met and discussed various matters including financials, internal audit reports and statutory audit reports. During the period under review, the Board of Directors of the Company accepted all the recommendations of the Audit Committee.

The details with respect to the meeting(s) of Audit Committee held during the year under review and quorum are provided in the Corporate Governance Report which forms part of the Annual Report.

The composition of the Nomination and Remuneration Committee as on March 31, 2025, and as on the date of this Report, is given below:

Note: The Board of Directors vide circular resolution passed on October 11, 2024, re-constituted the Nomination & Remuneration Committee by appointing Mr. Krishipal Raghuvanshi, Independent Director of the Company, as member of Nomination & Remuneration Committee.

The composition, terms of reference and powers of the Nomination and Remuneration Committee are in conformity with the requirements of the Act and Listing Regulations and the same have been provided in the Corporate Governance Report which forms part of the Annual Report.

The details with respect to the meeting(s) of Nomination and Remuneration Committee held during the year under review and quorum are provided in the Corporate Governance Report which forms part of the Annual Report.

(c) Stakeholders Relationship Committee

The composition of the Stakeholders Relationship Committee as on March 31, 2025, and as on the date of this Report is as below:

The composition, role, terms of reference and powers of the Stakeholders Relationship Committee are in conformity with the requirements of the Act and Listing Regulations and the same have been provided in the Corporate Governance Report which forms part of the Annual Report.

The details with respect to the meeting(s) of the Stakeholders Relationship Committee held during the year under review, quorum and status of investors complaints are provided in the Corporate Governance Report which forms part of the Annual Report.

(d) Risk Management and Strategy Committee

During the year under review and as on the date of this Report, the Company is not in top 1000 listed companies based on market capitalization as on March 31, 2024 and December 31, 2024, either on BSE and NSE and accordingly the Company is not required to constitute risk management committee as per Listing Regulations. However, since the Company is a registered NBFC, the Company has constituted Risk Management and Strategy Committee as per applicable Master Directions.

The composition of the Risk Management and Strategy Committee as on March 31, 2025, and as on the date of this Report is as follows:

Note: Upon cessation of tenure of Mr. Rakesh Sethi as an Independent Director of the Company with effect from close of business hours of October 14, 2024, the Board of Directors at its meeting held on November 04, 2024, re-constituted the Risk Management and Strategy Committee by designating Mr. Rajiv Kapoor, Non-Executive Non Independent Director of the Company, as Chairperson of the Risk Management and Strategy Committee.

The composition, role, terms of reference and powers of the Risk Management and Strategy Committee are in conformity with the requirements of the Master Direction. Further, the details with respect to the meeting(s) of the Risk Management and Strategy Committee held during the year under review and quorum, along with the terms of reference, have been provided in the Corporate Governance Report which forms part of the Annual Report.

(e) Corporate Social Responsibility Committee

The composition of the Corporate Social Responsibility ("CSR") Committee as on March 31, 2025, and as on the date of this Report, was as follow:

Each of the Director of the Company has submitted undertaking and declaration confirming on being fit and proper in terms of the provisions of Master Direction. The Board of Directors of the Company, on the recommendation of the Nomination and Remuneration Committee, has reviewed and confirmed that all existing Directors are fit and proper to continue to be appointed as a Director on the Board.

The Company has adopted a Code of Conduct for the Board Members, Key Managerial Personnel and Senior Management of the Company. All Board Members, Key Managerial Personnel and Senior Management Personnel have affirmed compliance with the Companys code of conduct during the financial year under review. The Managing Director & Chief Executive Officer has given the declaration as required under Regulation 34(3) read with Part D of Schedule V of the Listing Regulations regarding compliance with the Code of Conduct of the Company for the year ended on March 31, 2025, which forms part of the Report.

In terms of Section 203 of the Act, the Key Managerial Personnel(s) of the Company as on the date of this Report, are as below:

During the year ended March 31, 2025 and as on the date of this Report, the Company has only one wholly owned subsidiary company i.e., DFL Technologies Private Limited ("WoS").

Accordingly, pursuant to the provisions of Sections 129, 134 and 136 of the Act, read with applicable rules thereunder, Regulation 33 of the Listing Regulations and applicable Indian Accounting Standards ("Ind AS"), the Board of Directors of the Company approves the Consolidated Financial Statements of the Company and its WoS. Copies of the Balance Sheet, Profit and Loss Account, Report of the Board of Directors and Report of the Auditors of the WoS are not attached to the accounts of the Company for the financial year 2024-25. The Company will make these documents/details available upon request by any Member of the Company. These documents/details will also be available for inspection by any Member of the Company at the registered office of the Company and at the registered office of the WoS during business hours on working days and through electronic means. Members of the Company can request the same by sending an email to corpsec@ trucapfinance.com till the date of ensuing AGM. The Companys financial statements, which form part of the Annual Report, are prepared in accordance with the Act, applicable regulations and Ind AS 110.

As on March 31, 2025, the total investment held by the Company in the equity share capital of the WoS stood at Rs. 3,190.10 lakhs.

A report on the performance and financial position of WoS, as per Section 129(3) of the Act read with the Companies (Accounts) Rules, 2014, as amended, is provided in the prescribed form AOC-1 as Annexure - III of this Report and hence not repeated here for the sake of brevity.

As per the provisions of the Act, during the year under review and as on the date of this Report, the Company did not have any Joint Ventures/Associates.

In terms of Section 134(5) of the Act read with the Companies (Accounts) Rules, 2014, as amended, your Directors state that:

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

The Company has in force the Dhanvarsha ESOP Plan - 2018 ("ESOP Plan 2018") which is prepared as per the provisions of SEBI (Share Based Employee Benefits) Regulations, 2014 ("SBEB Regulations"), amended at the 28^th Annual General Meeting of the Company held on September 29, 2022, to bring it in lines with the provisions of the SEBI (Share Based Employee Benefits & Sweat Equity) Regulations, 2021, as amended (SEBI SBEB & SE Regulations). The amendments approved are not detrimental to the interests of the current grantees of the Company under the ESOP Plan 2018. A certificate from M/s. U. Hegde & Associates, Practicing Company Secretaries, Secretarial Auditor of the Company, has been obtained that the ESOP Plan 2018 has been implemented in accordance with SEBI SBEB & SE Regulations, and the same will be available for inspection by Members of the Company through electronic means.

Under IND AS, equity settled share-based payment transactions with employees are required to be accounted as per IND AS 102 "Share-based Payment", whereby the fair value of options as on the grant date should be estimated and recognized as an expense over the vesting period. In accordance with the above, the Company has followed fair value method for equity options while preparing its financial statements.

(a) in the preparation of the annual accounts for the year ended March 31, 2025, the applicable accounting standards read with the requirements set out under Schedule III to the Act, have been followed along with proper explanation relating to material departures;

(b) the Directors 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 as at March 31, 2025 and of the profit and loss of the Company for the year ended on that date;

(c) the Directors 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) the Directors have prepared the annual accounts on a ‘going concern basis;

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

The Board of Directors of the Company at the Board Meeting held on May 26, 2025, approved the grant of 26,62,500 stock options to eligible employee(s) under ESOP Plan 2018. The options are subject to terms and conditions mentioned in the ESOP Plan 2018, options granted would entitle the grantee to acquire up to and not exceeding 26,62,500 equity shares of the Company at a face value of Rs. 2/- each subject to the terms and conditions of vesting as set out in the grant letter.

As on March 31, 2025, the Company is classified as a Base Layer Non-Banking Financial Company as per Master Directions and is accordingly required to maintain a leverage ratio which as per regulatory norms shall not be more than 7 times. Accordingly, the Company is adequately capitalized and the leverage ratio of the Company as on March 31, 2025 was at 3.92 times.

A detailed review of the operations, performance and future outlook of the Company and its business, as stipulated under Regulation 34(2)(e) read with Schedule V of the Listing Regulations, is presented in a separate section forming part of the Annual Report under the head ‘Management Discussion and Analysis.

Pursuant to amendment in Listing Regulations, top 1,000 listed entities based on market capitalisation on either BSE or NSE are required to submit a Business Responsibility and Sustainability Report ("BRSR"). Since, as on March 31, 2024 read with market capitalization as on December 31, 2024, the Company is not under top 1,000 companies based on market capitalization either on BSE and NSE, BRSR is not required to be annexed to this Report. However, as instructed by SEBI vide interpretive letter regarding the applicability of BRSR, issued under SEBI (Informal Guidance) Scheme, 2003, dated May 31, 2023, SEBI directed all top 1,000 entities basis market capitalisation till financial year 202122, to continue to annex a business responsibility report to its annual report. Accordingly, the Business Responsibility Report ("BRR"), in terms of Regulation 34(2)(f) of the Listing Regulations, describing the initiatives taken by the Company from an environmental, social and governance perspective is attached as part of the Annual Report.

Your Company believes in adopting the best Corporate Governance practices and has also implemented several best practices prevalent globally. The report on Corporate Governance as stipulated under Regulation 34(3), read with Schedule V of the Listing Regulations forms an integral part of the Annual Report.

Further, certificate obtained from M/s. U. Hegde & Associates, Practicing Company Secretaries, confirming compliance with the conditions of the Corporate Governance as stipulated under Regulation 34(3) and Schedule V to the Listing Regulations is annexed to the Corporate Governance Report which forms part of the Annual Report.

The Board of Directors affirms that the applicable Secretarial Standards, i.e., SS-1 and SS-2, as amended, issued by the Institute of Company Secretaries of India ("ICSI") relating to ‘Meetings of Board of Directors and ‘General Meetings, respectively, have been duly followed by the Company.

All contracts executed by the Company during the financial year with related parties were on an arms length basis and in the ordinary course of business. All such RPTs were placed before the Audit Committee/Board for approval, wherever applicable. The Audit Committee reviews all RPTs on quarterly basis.

During the year, the contracts/arrangements/transactions with related parties entered into by the Company were not material in nature in accordance with Regulation 23 of the Listing Regulations.

Since all RPTs entered into by the Company during the financial year ended March 31, 2025, were on an arms length basis and in the ordinary course of business, the disclosure required in Form AOC-2 under Section 134(3)(h) of the Act, read with Rule 8 of the Companies (Accounts) Rules, 2014, as amended, is not applicable. Further, in compliance with Regulation 23 of the Listing Regulations, disclosures relating to RPTs on a consolidated basis are filed with the stock exchange(s) on a half-yearly basis.

Your Company maintains robust internal control, compliance, and an audit framework tailored to match the operational scale and the intricate nature of the business of the Company. The Company has in place adequate internal financial controls with reference to the financial statements and the same are commensurate with the scale and complexity of its operations. Further, pursuant to provisions of Section 138 of the Act, the Company has appointed internal auditors who conduct internal audits on a periodic basis to independently validate the existing controls as per scope assigned to them. The internal audit program is reviewed by the Audit Committee at the beginning of the year to ensure that the coverage of the areas is adequate. Internal Auditors test the design and effectiveness of the key controls. Significant audit observations, if any, are presented to the Audit Committee along with the status of management actions and the progress of implementation of recommendations. The Company also periodically engages outside experts to carry out independent reviews of the effectiveness of various business processes. The observations and best practices suggested are reviewed and appropriately implemented with a view to continuously strengthening internal controls.

During the year under review, no reportable material weaknesses in the design or operations were observed.

Further, reference is invited to Note 54.10 of notes to the Standalone Financial Statements forming part of the Annual Report regarding frauds committed by employees/ customers of the Company which are dealt with according to Reserve Bank of India guidelines and are in nature of operational related frauds due to the nature of business of the Company. The Company has taken disciplinary/ legal action against such employees/customers.

The Shareholders at the 30^th Annual General Meeting of the Company held on September 26, 2024, appointed M/s. Khandelwal Kakani & Co., Chartered Accountants (Firm Registration No. 001311C with Institute of Chartered Accountants of India), as the Statutory Auditors of the Company, pursuant to the provisions of Section 139, 141 and 142 and other applicable provisions, if any, of the Act and the Companies (Audit and Auditors) Rules, 2014, as may be applicable, including any statutory modification(s) or reenactments) thereof, for the time being in force, Guidelines for Appointment of Statutory Central Auditors (SCAs)/ Statutory Auditors (SAs) of Commercial Banks (excluding RRBs), UCBs and NBFCs (including HFCs), issued by the Reserve Bank of India and other applicable laws, to hold office from the conclusion of 30^th Annual General Meeting till the 33^rd Annual General Meeting of the Company.

The audit for the financial year 2024-25 was conducted by M/s. Khandelwal Kakani & Co., Chartered Accountants (Firm Registration No. 001311C with the Institute of Chartered Accountants of India), Statutory Auditors of the Company and there are no qualifications, reservations, adverse remarks, or disclaimers made by them in their Audit Report(s). The notes to the financial statements referred to in the Auditors Report are self-explanatory and therefore do not call for any comments under Section 134 of the Act. The report(s) issued by the Statutory Auditors of the Company are annexed to the financial statements in the Annual Report.

Pursuant to Section 204(1) of the Act read with Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, M/s. U. Hegde and Associates, Practicing Company Secretaries (Membership Number: A22133 with the Institute of Company Secretaries of India), was appointed as the Secretarial Auditor of the Company for the financial year 2024-25 and has issued Secretarial Audit Report in Form MR-3 for the financial year ended March 31, 2025. A copy of the same is annexed herewith as Annexure-IV-A to this Report. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.

Further, pursuant to the provisions of Regulation 24A of the Listing Regulations and in accordance with Section 204 of the Act, basis recommendation of the Board, the Company is required to appoint Secretarial Auditor, with the approval of the Members at the AGM. In light of the aforesaid, the Board of the Company has recommended the appointment of M/s. U. Hegde and Associates, Practicing Company Secretaries (Membership Number: A22133 with the Institute of Company Secretaries of India), as the Secretarial Auditor of the Company for a period of 5 (five) consecutive financial years i.e. commencing from FY 2025-26 up to FY 2029-30, subject to approval of the Members at the ensuing AGM of the Company, to undertake Secretarial Audit as required under the Act and Listing Regulations and issue the necessary Secretarial Audit Report for the aforesaid period. Further, the Secretarial Auditor has confirmed that he has subjected himself to Peer Review process by the Institute of Company Secretaries of India ("ICSI") and hold valid certificate issued by the Peer Review Board of ICSI.

Pursuant to Regulation 24A of the Listing Regulations, the Annual Secretarial Compliance Report for the financial year 2024-25 was issued by M/s. U. Hegde & Associates, Practicing Company Secretaries, Secretarial Auditor of the Company. The Annual Secretarial Compliance Report for the financial year 2024-25 has been submitted to BSE and NSE in compliance with the SEBI Circular No. SEBI/HO/CFD/ CMD1/CIR/P/2020/38 dated March 19, 2020, read with BSE Circular No. 20230410-41 dated April 10, 2023 and NSE Circular No. NSE/CML/2023/30 dated April 10, 2023.

Since, pursuant to Regulation 16(1)(c) of the Listing Regulations, based on the Audited Financial Statements of the Company as on March 31, 2025, WoS continues to be the material subsidiary company of the Company, accordingly, as per Regulation 24A of the Listing Regulations, the Secretarial Audit Report of the WoS for financial year 202425 is annexed herewith as Annexure-IV-B to this Report.

Pursuant to Section 143(12) of the Act, and circular issued by the National Financial Reporting Authority dated June 26, 2023, there were 3 instances amounting to Rs. 6.23 crores (approximately) of frauds committed during the financial year ended March 31, 2025, by the officers or employees of the Company and reported by the Statutory Auditors to the Audit Committee.

The details required under Rule 13(4) of the Companies (Audit and Auditors) Rules, 2014 are as under:

* From the above, 0.50 Crore has been recovered by the Company.

In accordance with Section 135 of the Act, the Company has constituted a CSR Committee.

The Board of Directors of the Company, have on recommendation of the CSR Committee, approved Policy on Corporate Social Responsibility of the Company and the same is available on the website of the Company i.e., www. trucapfinance.com. The Annual Report on CSR activities in accordance with the Companies (Corporate Social Responsibility Policy) Rules, 2014, as amended, is annexed as Annexure- V to this Report.

The Company is engaged in the activity of providing financial services and, as such, its operations have limited impact vis-a-vis substantial energy consumption. Energy is consumed on a regular level to aid regular office work, however, the Company appreciates the need to reduce the net carbon footprint. Accordingly, the Company is taking all possible measures to conserve energy and reduce consumption by adopting alternative power devices or employing technology solutions.

During the year under review, the Company has borrowed in foreign currency through External Commercial Borrowing ("ECB"). As ., 2025, the outstanding ECB was Rs. 8,404.00 lakhs.

The information pursuant to Section 134(3)(m) of the Act read with Companies (Accounts) Rules, 2014, as amended is as follows:

a. Considering the nature of Companys business, the Company is not required to undertake any activity involving the Conservation of Energy or Technological or Technology Absorption and nor has it applied its resources towards research and development;

b. The Companys Foreign Exchange Earning was Nil during the year under review.

c. Foreign Exchange Outgo was Rs. 104.56 lakhs during the year under review.

The Company, being an NBFC registered with the RBI, the provisions mentioned in Section 186 of the Act, related to loans made, guarantees given, and securities provided do not apply to the Company. Accordingly, the disclosures under the provisions of Section 186 of the Act read with the Companies (Meetings of Board and its Powers) Rules, 2014, as amended, have not been made in this Report.

Further, in accordance with the Master Direction, the Board of Directors have, on recommendation of the Audit Committee, approved Policy on Loan to Directors and Senior Officers. Further, during the year under review and up to the date of this Report, no loans to directors and senior officers of the Company have been provided.

In compliance with the provisions of Section 177(9) of the Act read with Rule 7 of the Companies (Meetings of Board and its Powers) Rules, 2014, as amended, and Regulation 22 of the Listing Regulations, and to ensure that the activities of the Company and its employees are conducted in a fair and transparent manner by adoption of highest standards of professionalism, honesty, integrity and ethical behavior, your Company has adopted a Vigil Mechanism / Whistle Blower Policy. The aim of the policy is to provide adequate safeguards against victimization of whistle blower who avails of the mechanism and is also provided direct access to the Chairperson of the Audit Committee, in appropriate or exceptional cases.

Accordingly, Whistle Blower Policy has been formulated with a view to provide a mechanism for the Directors and employees of the Company to approach the Chairperson of the Audit Committee of the Company.

The purpose of this policy is to provide a framework to promote responsible and secure whistle blowing. It protects employees willing to raise a concern about serious irregularities within the Company.

As an NBFC, the Company is exposed to various risks which, inter alia, includes credit, liquidity, market, operational, interest rate risk and other risk associated with the business and the industry it operates in. To mitigate such risks, the Company continues to invest in talent, processes and emerging technologies for building advanced risk management capabilities and has a well-defined risk management framework in place for managing and reporting on risks. A systematic approach has been adopted that originates with the identification of risk, categorization and assessment of identified risk, evaluating effectiveness of existing controls and building additional controls to mitigate risk and monitoring the residual risk through effective Key Risk Indicators.

The Board has constituted a Risk Management and Strategy Committee as required under Master Direction.

The Company has a Board approved Policy on Risk Management, which, inter alia, provides for principles of risk management, risk governance, organization structure, business control measures, principle risks and business continuity plan. The management identifies and controls risks through a defined framework in terms of the aforesaid policy.

Further, in terms with Master Directions on Fraud Risk Management in Non-Banking Financial Companies (NBFCs) (including Housing Finance Companies) dated July 15, 2024, as amended, the Board has approved Fraud Risk Management Policy and has constituted the Committee of Executive and Internal Risk Management Committee for identification, classification and management of fraud(s).

Further, the Board, on a periodic basis, reviews and assesses the Risk Assessment Statement, monitoring the various risks, to which the Company is exposed to vis-a-vis the prudential parameters.

In terms of the provisions of Section 197(12) of the Act read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, the disclosures pertaining to the remuneration and other details as required are annexed as Annexure - VI to this Report.

As on date, the equity shares of the Company are listed on BSE and NSE. The listing fees for the financial year 202526 for BSE and NSE have been paid by the Company.

The Company is into the business of lending and also offers loans against the collateral of gold ornaments. In its normal course of business, whenever default occurs, the Company disposes such assets through auction, to settle outstanding debt as per the auction policy of the Company and in compliance with the provisions specified in the applicable Master Directions. Any surplus funds from the auction proceeds are returned to the customers/obligors. The disclosure in compliance with the Master Direction in respect of auctions made during the year is provided in Note No. 54.13 of the Standalone Audited Financial Statements of the Company annexed to the Annual Report.

During the year under review, pursuant to provisions prescribed in the Master Direction - Reserve Bank of India (Transfer of Loan Exposures) Directions, 2021 issued by RBI on September 24, 2021, as amended ("TLE Direction") and Master Direction - Reserve Bank of India (Securitization of Standard Assets) Directions, 2021, as amended ("Securitization Direction"), the Company has transferred, acquired and securitized loan exposure under the TLE Direction and Securitization Direction. The disclosures as required under both the respective Directions are included in Note No. 54.09 and 54.16 of the Standalone Audited Financial Statements annexed to the Annual Report.

The Company is registered as NBFC under Section 45-IA of the Reserve Bank of India Act, 1934. However, RBI 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 repayment of deposits/discharge of liabilities by the Company.

In accordance with the applicable provisions of the Act read with Investor Education and Protection Fund (Accounting, Audit, Transfer and Refund) Rules, 2016 ("IEPF Rules"), all unclaimed dividends are required to be transferred by the Company to the IEPF, after completion of 7 (Seven) years. Further, according to IEPF Rules, the shares on which dividend has not been claimed by the shareholders for 7 (Seven) consecutive years or more shall be transferred to the demat account of the IEPF Authority.

Accordingly, as on March 31, 2025, the unclaimed dividend for the financial year 2017-2018, of those shareholders of the Company, who have not encashed or claimed their dividend for seven years, are due to be transferred with interest accrued, if any, thereon, to IEPF on November 04, 2025. Further, pursuant to explanation to proviso for sub-section 6 of section 124 of the Act, there no shares required to be transferred to IEPF.

SEBI has, vide its circular SEBI/HO/DDHS/DDHS- RAC-1/P/CIR/2023/176 dated November 08, 2023, introduced the ‘Framework for transfer of unclaimed amounts to Escrow Accounts and claim thereof by investors of the non-convertible debentures by amending Regulation 61A of the Listing Regulations.

The ‘Policy for claiming and verification of unclaimed amounts with respect to non-convertible debentures is hosted on the website of the Company at www. trucapfinance.com. Further, during the year under review, no interest/redemption amount was required to be transferred to the Escrow Account or IEPF in terms with the Framework.

The Board of Directors of the Company has adopted the ‘Code for Insider Trading & Fair Disclosure of Unpublished Price Sensitive Information (UPSI) ("Code") as formulated under SEBI (Prohibition of Insider Trading) Regulations, 2015, as amended.

Your Company recognizes its responsibility and continues to provide a safe working environment for women, free from sexual harassment and discrimination. In compliance with the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, as amended, the Company has put in place a Policy on Prevention of Sexual Harassment of Women at Workplace and the same is available on the website of the Company

The Company also provides for mandatory training on prevention of sexual harassment for every new joinee, as well as all employees on an annual basis.

During the year under review, there were no complaints made or case filed under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, as amended.

The provisions of Cost Records and Cost Audit as prescribed under Section 148 of the Act are not applicable to the Company.

There were no significant material orders passed by the Regulators / Courts that would impact the going concern status of the Company and its future operation.

There are no proceedings pending under the Insolvency and Bankruptcy Code, 2016 against the Company as on March 31, 2025.

During the year under review, there were no one time settlements made by the Company for any loan/borrowing taken from the Banks and/or Financial Institutions. Therefore, as per Rule 8(5)(xii) of Companies (Accounts) Rules, 2014, as amended reasons of difference in the valuation at the time of one-time settlement and valuation done while taking loan from the Banks or Financial Institutions are not required to be reported.

Your Directors state that no disclosure or reporting is required in respect of the following items, as there were no transactions / events on these items during the year under review:

1. Issue of equity shares with differential rights as to dividend, voting or otherwise.

2. Issue of shares (including sweat equity shares) to employees of the Company under any scheme.

3. None of the Executive Director(s) of the Company receives any remuneration or commission from its subsidiary.

4. any scheme involving provision of money for the purchase of the Companys own shares by employees or by trustees for the benefit of employees.

Your Directors place on records their sincere appreciation for the assistance and guidance provided by the Reserve Bank of India, the Ministry of Corporate Affairs, the Securities and Exchange Board of India, government and other Regulatory Authorities, Stock Exchanges, other statutory bodies, bankers and Members of the Company for the assistance, co-operation and encouragement and continued support extended to the Company.

Your directors take this opportunity to thank the customers, vendors and investors and other business partners of the Company for their continued support during the year and also place on record their appreciation to the contribution made by the employees of the Company at all levels.