5.7 Provisions

Provisions are recognised when the enterprise has a present obligation (legal or constructive) as a result of past events, and
it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation, and a
reliable estimate can be made of the amount of the obligation.

When the effect of the time value of money is material, the enterprise determines the level of provision by discounting the
expected cash flows at a pre-tax rate reflecting the current rates specific to the liability. The expense relating to any provision
is presented in the statement of profit and loss net of any reimbursement.

5.8 Contingent Liabilities

A contingent liability is a possible obligation that arises from past events whose existence will be confirmed by the
occurrence or non- occurrence of one or more uncertain future events beyond the control of the Company or a present
obligation that is not recognized because it is not probable that an outflow of resources will be required to settle the
obligation. A contingent liability also arises in extremely rare cases where there is a liability that cannot be recognized
because it cannot be measured reliably. The Company does not recognize a contingent liability but discloses its existence
in the financial statements.

5.9 Earnings Per Share

The Company reports basic and diluted earnings per share in accordance with Ind AS 33 on Earnings per share. Basic EPS
is calculated by dividing the net profit or loss for the year attributable to equity shareholders (after attributable taxes) by
the weighted average number of equity shares outstanding during the year.

For the purpose of calculating diluted earnings per share, the net profit or loss for the year attributable to equity shareholders
and the weighted average number of shares outstanding during the year are adjusted for the effects of all dilutive potential
equity shares. Dilutive potential equity shares are deemed converted as of the beginning of the period, unless they have
been issued at a later date. In computing the dilutive earnings per share, only potential equity shares that are dilutive and
that either reduces the earnings per share or increases loss per share are included.

5.10 Segment Reporting

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision
maker (CODM).

The Board of Directors (BOD) of the Company assesses the financial performance and position of the Company, and makes
strategic decisions. The BOD, which has been identified as being the chief operating decision maker. The Company is
engaged in the business of

i) Lending finance and ii) Fees & commission income. The said business are aggregated for the purpose of review of
performance by CODM. Accordingly, the Company has concluded that the business of lending finance and fees &
commission income to be the only reportable segment.

5.11 Leases

Ind AS 116 requires lessees to determine the lease term as the non-cancellable period of a lease adjusted with any option to
extend or terminate the lease, if the use of such option is reasonably certain. The Company makes an assessment on the
expected lease term on a lease-by-lease basis and thereby assesses whether it is reasonably certain that any options to extend
or terminate the contract will be exercised. In evaluating the lease term, the Company considers factors such as any
significant leasehold improvements undertaken over the lease term, costs relating to the termination of the lease and the
importance of the underlying asset to Company's operations taking into account the location of the underlying asset and the
availability of suitable alternatives. The lease term in future periods is reassessed to ensure that the lease term reflects the
current economic circumstances. Since all leases of the Company is for a term less than 12 months, single lessee accounting
model under Ind AS 116 is not applicable.

6 Significant accounting judgements, estimates and assumptions

The preparation of financial statements in conformity with the Ind AS requires the management to make judgments,
estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities and the
accompanying disclosure and the disclosure of contingent liabilities, at the end of the reporting period. Estimates and
underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period
in which the estimates are revised and future periods are affected.

Although these estimates are based on the management’s best knowledge of current events and actions, uncertainty about
these assumptions and estimates could result in the outcomes requiring a material adjustment to the carrying amounts of
assets or liabilities in future periods.

7 Impairment of loans portfolio

The measurement of impairment losses across all categories of financial assets requires judgement, in particular, the
estimation of the amount and timing of future cash flows and collateral values when determining impairment losses and the
assessment of a significant increase in credit risk. These estimates are driven by a number of factors, changes in which
can result in different levels of allowances.

It has been the Company’s policy to regularly review its models in the context of actual loss experience and adjust when
necessary. The impairment loss on loans and advances is disclosed in more detail in Note 5.1(vi) Overview of ECL
principles.

In case, higher provisions are to be considered as per the prudential norms of the Reserve Bank of India, they are considered.

8 Effective Interest Rate (EIR) method

The Company’s EIR methodology, recognises interest income / expense using a rate of return that represents the best
estimate of a constant rate of return over the expected behavioural life of loans given / taken and recognises the effect of
potentially different interest rates at various stages and other characteristics of the product life cycle (including prepayments
and penalty interest and charges).

This estimation, by nature, requires an element of judgement regarding the expected behaviour and life-cycle of the
instruments, as well expected changes to India’s base rate and other fee income/expense that are integral parts of the
instrument.

Investment designated at FVTPL is a portfolio of equity instruments. Equity instruments have been classified at Fair value through
profit and loss since cash flows from equity instruments does not represent solely payment of principal and interest.

During the FY 2023-24, Certain investments as mentioned below is recognised as Prior period errors due to omissions from, and
misstatements in the entity's financial statements of earliest prior periods as per paragraph 42 subject to paragraph 43 of Ind As 8
'Accounting Policies,changes in Accounting Estimates and Errors'.As per the said standard,the entity shall correct material prior
period errors retrospectively except to the extent that it is impracticable to determine either the period -specific effects or the
cumulative effect of the error in the first set of financial statements approved for issue after their discovery by:

(a) restating the comparative amounts for the prior period(s) presented in which the error occurred;or

(b) if the error occurrred before the earliest prior period presented,restating the opening balance of assets,liabilities and equity
for the earliest prior period presented

During the financial year 2023-24, while undergoing the procedures and processes in the shifting of registered office of the company
from the jurisdiction of RoC-Chennai to RoC- Coimbatore, the company discovered physical share certificates of some investments
made in the past. Those shares were dematerialised and brought to the demat account of the company.The prior periods errors were
not retrospectively restated by adjusting opening balances, as the amounts involved were deemed immaterial.

The company has issued Secured Unlisted Redeemable Non-Convertible Debentures (the“Debentures”)
during the year aiming to increase the fund inflow in trenches,and in dematerialized form to the proposed
Person(s) belonging to Promoter Category and or to Person(s) belonging to Non-promoter category, by way
of Private Placement (“Debenture issue”) .

During the year 2024-25, for meeting the prospective financial needs directing towards its growth and
expansion, the company has raised Rs.34.5 Lakhs from 8 persons through issuance of Secured unlisted
Redeemable Non- Convertible Debentures by way of private placement in dematerialized form. The
Company has allotted 3,450 Secured unlisted Redeemable Non-Convertible Debentures at the rate of
Rs.1000 each. The Company has redeemed 6,150 Secured unlisted Redeemable Non-Convertible
Debentures at the rate of Rs.1000 each.

Debenture Redemption Reserve

Pursuant to notification issued by Ministry of Corporate Affairs on 16th August, 2019 in exercise of the
powers conferred by sub- sections (1) and (2) of section 469 of the Companies Act, 2013 (18 of 2013), the
Central Government amended the Companies (Share Capital and Debentures) Rules, 2014. In the principal
rules, in rule 18, for sub-rule (7), the limits with respect to adequacy of Debenture Redemption Reserve and
investment or deposits for listed companies (other than All India Financial Institutions and Banking
Companies as specified in sub-clause (i)), Debenture Redemption Reserve is not required to maintain in case
of public issue of debentures as well as privately placed debentures for NBFCs registered with Reserve Bank
of India under section 45-IA of the RBI Act, 1934.

Terms/ rights attached to equity shares

The Company has only one class of equity shares having a par value of Rs. 10/- per share. Each holder of equity shares
is entitled to one vote per share. The Company declares and pays dividends in Indian rupees. The dividend proposed
by the Board of Directors (if any) is subject to the approval of the shareholders in the ensuing Annual General Meeting.
In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of
the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of
equity shares held by the shareholders.

Nature and purpose of Reserves

Statutory reserve (Statutory Reserve pursuant to Section 45-IC of The RBI Act, 1934): Section 45IC
of Reserve Bank of India Act, 1934 ("RBI Act, 1934") defines that every non banking finance institution
which is a Company shall create a reserve fund and transfer therein a sum not less than twenty percent of
its net profit every year as disclosed in the statement of profit and loss before any dividend is declared. The
Company has not created any special reserve (20% of Profit) under Section 45-IC of RBI Act, 1934 for
Financial year FY 2023-24 since, the Company has incurred losses.

Note 37: Retirement Benefit Plan
Defined Contribution Plan

The Company makes Provident Fund contribution which is defined contribution plan for qualifying employees.
Under the Scheme, the Company is required to contribute a specified percentage of the payroll costs to fund the
benefits. The Company recognized Rs. 3.85 lakhs (31 March 2024: Rs. 4.27 Lakhs) for Provident Fund
contribution in the Statement of Profit and Loss. The contribution payable to these plans by the Company are at
rates specified in the rules of the Scheme.

Defined Benefit Plan

The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of
service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service.

Note 38: Convertible Warrants

During the year the company has allotted 4,50,000 equity shares each against the conversion of 4,50,000
Convertible Warrants each held by Mr.Mekkattukulam Anto Jayson & Mr Jyothish A R on 16.04.2024 and
alloted 2,00,000 & 1,50,000 equity shares against conversion of 2,00,000 & 1,50,000 Convertible Warrants held
by Mr.Mekkattukulam Anto Jayson & Sharewealth secuirities Ltd.

Note:

a) Related parties have been identified on the basis of the declaration received by the management and other
records

b) Loans given to related parties are repayable on demand.

c) The remuneration to the key managerial personnel does not include the provisions made for gratuity.

Note 40: Maturity analysis of assets and liabilities

The table below shows an analysis of assets and liabilities analysed according to when they are expected to be
recovered or settled.

Note 41: Contingent liabilities, commitments and leasing arrangements

Note 41 (i): Contingent Liabilities

The Company is not exposed to any contingent liabilities during the current and previous year.

Note 41 (ii): Commitments

The Company does not have any irrevocable commitments as at 31st March 2025 and 31st March 2024.

Note 41 (iii): Lease Disclosures (entity as a lessee)

The Company has not recognised ROU asset and lease liability for all lease contracts since, all such leases are
either low value leases or short term leases (lease term of twelve months or less).

Note 42: Fair Value Measurement

42.1 Valuation principles

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly
transaction in the principal (or most advantageous) market at the measurement date under current market
conditions , regardless of whether that price is directly observable or estimated using a valuation technique.

In order to show how fair values have been derived, financial instruments are classified based on a hierarchy
of valuation techniques.

42.2 Valuation governance

The Company's process to determine fair values is part of its periodic financial close process. The Audit
Committee exercises the overall supervision over the methodology and models to determine the fair value
as part of its overall monitoring of financial close process and controls. The responsibility of ongoing
measurement resides with business units . Once submitted, fair value estimates are also reviewed and
challenged by the Risk and Finance functions.

42.3 Assets and liabilities by fair value hierarchy

The following table shows an analysis of financial instruments recorded at fair value by level of the fair value
hierarchy:

42.4 Valuation techniques Equity instruments

The majority of equity instruments are actively traded on public stock exchanges with readily available active
prices on a regular basis. Such instruments are classified as Level 1. Units held in funds are measured based
on their published net asset value (NAV), taking into account redemption and/or other restrictions. Such
instruments are generally Level 2. Equity instruments in non-listed entities included investment in private
equity funds are initially recognised at transaction price and re measured (to the extent information is
available) and valued on a case-by-case and classified as Level 3.

Valuation methodologies of financial instruments not measured at fair value

Below are the methodologies and assumptions used to determine fair values for the above financial instruments
which are not recorded and measured at fair value in the Group’s financial statements. These fair values were
calculated for disclosure purposes only.

Short-term financial assets and liabilities

For financial assets and financial liabilities that have a short-term maturity (less than twelve months), the carrying
amounts, which are net of impairment, are a reasonable approximation of their fair value. Such instruments include:
cash and balances, balances other than cash and cash equivalents, trade payables and other financial liabilities
without a specific maturity. Such amounts have been classified as Level 2 on the basis that no adjustments have been
made to the balances in the balance sheet.

Loans and advances to customers

The fair values of loans and receivables are estimated by discounted cash flow models that incorporate
assumptions for credit risks, foreign exchange risk, probability of default and loss given default estimates.

Note 43: Risk Management

Risk is an integral part of the Company's business and sound risk management is critical to the success. As a financial
intermediary, the Company is exposed to risks that are particular to its lending and the environment within which it
operates and primarily includes credit, liquidity and market risks. The Company has a risk management policy which
covers risk associated with the financial assets and liabilities. The Board of Directors of the company are responsible
for the overall risk management approach, approving risk management strategies and principles. The company have
a risk management policy which covers all the risk associated with its assets and liabilities.

The Company has implemented comprehensive policies and procedures to assess, monitor and manage risk
throughout the Company. The risk management process is continuously reviewed, improved and adapted in the
changing risk scenario and the agility of the risk management process is monitored and reviewed for its
appropriateness in the changing risk landscape. The process of continuous evaluation of risks includes taking stock
of the risk landscape on an event-driven basis.

The Company has an elaborate process for risk management. Major risks identified by the businesses and functions
are systematically addressed through mitigating actions on a continuing basis.

Credit Risk

Credit risk is the risk that a customer or counterparty will default on its contractual obligations resulting in financial
loss to the Company. The Company’s main income generating activity is lending to customers and therefore credit
risk is a principal risk. Credit risk mainly arises from loans and advances.

The credit risk management policy of the Company seeks to have following controls and key metrics that allows
credit risks to be identified, assessed, monitored and reported in a timely and efficient manner in compliance with
regulatory requirements.

- Standardize the process of identifying new risks and designing appropriate controls for these risks

- Maintain an appropriate credit administration and loan review system

- Establish metrics for portfolio monitoring

- Minimize losses due to defaults or untimely payments by borrowers

- Design appropriate credit risk mitigation techniques

In order to mitigate the impact of credit risk in the future profitability, the company makes reserves basis the expected
credit loss (ECL) model for the outstanding loans as balance sheet date.

The below discussion describes the Company's approach for assessing impairment as stated in the significant
accounting policies.

The Company considers a financial instrument defaulted and therefore Stage 3 (credit impaired) for ECL
calculations in all cases when the borrower becomes 120 days past due on its contractual payments.

As a part of a qualitative assessment of whether a customer is in default, the Company also considers a variety of
instances that may indicate unlikeness to pay. When such events occur, the Company carefully considers whether the
event should result in treating the customer as defaulted and therefore assessed as Stage 3 for ECL calculations or
whether Stage 2 is appropriate.

Exposure at Default (EAD)

The outstanding balance at the reporting date is considered as EAD by the Company. Considering that the PD
determined above factors in amount at default, there is no separate requirement to estimate EAD.

The Company don't have historical information and hence uses the PD default rates stated by external
reporting agencies. Considering the different products and schemes, the Company has bifurcated its loan portfolio
into various pools.

LGD Rates have been considered based on proxy FIRB rates for all loans.

The provision computed under ECL is higher when compared with the provision prescribed as per RBI norms
taking into account the time lag between an account becoming non-performing, its recognition as such, the
realisation of the security and the erosion over time in the value of security charged,make provision against sub¬
standard assets, doubtful assets and loss assets as provided by RBI norms.Hence provisioning is considered as
per expected credit loss model.

The entity shall after taking into account the degree of well defined credit weaknesses and extent of dependence
on collateral security for realisation, classify its lease/hire purchase assets, loans and advances and any other
forms of credit into the following classes namely,standard,substandard,doubtful assets and Loss assets.

For Loss assets,the entire asset shall be written off. If the assets are permitted to remain in the books for any
reason, 100% of the outstandings is provided.

And for Doubtful assets,100% provision to be created to the extent to which the advance is not covered by the
realisable value of the security to which the entity has a valid recourse shall be made. The realisable value is
estimated on a realistic basis.

Period for which the asset has and the percentage of provision to be created are as followed:

Asset & Liability management

Asset and Liability Management (ALM) is defined as the practice of managing risks arising due to mismatches in
the asset and liabilities. Company’s funding consist long term source with different maturity patterns and varying
interest rates. On the other hand, the asset book also comprises of loans of different duration and interest rates.
Maturity mismatches are therefore common and has an impact on the liquidity and profitability of the company.
It is necessary for Company’s to monitor and manage the assets and liabilities in such a manner to minimize
mismatches and keep them within reasonable limits.

The objective of this policy is to create an institutional mechanism to compute and monitor periodically the
maturity pattern of the various liabilities and assets of Company to (a) ascertain in percentage terms the nature
and extent of mismatch in different maturity buckets, especially the 1-30/31days bucket, which would indicate
the structural liquidity (b) the extent and nature of cumulative mismatch in different buckets indicative of short
term dynamic liquidity and (c) the residual maturity pattern of repricing of assets and liabilities which would
show the likely impact of movement of interest rate in either direction on profitability. This policy will guide
the ALM system in Company.

The scope of ALM function can be described as follows:

- Liquidity risk management

- Management of market risks

- Others

Liquidity risk refers to the risk that the Company may not meet its financial obligations. Liquidity risk arises due
to the unavailability of adequate funds at an appropriate cost or tenure. The objective of liquidity risk
management, is to maintain sufficient liquidity and ensure that funds are available for use as per requirements.
The Company consistently generates sufficient cash flows from operating and financial activities to meet its
financial obligations as and when they fall due. Our resource mobilisation team sources funds from multiple
sources. The resource mobilisation team is responsible for diversifying fund raising sources, managing interest
rate risks and maintaining a strong relationship with banks, financial institutions, mutual funds, insurance
companies, other domestic and foreign financial institutions and rating agencies to ensure the liquidity risk is well
addressed.

The table below provide details regarding the contractual maturities of significant financial assets and liabilities
as on:-

Market Risk is the risk that the fair value or the future cash flows of a financial instrument will fluctuate because of
changes in market factor. Such changes in the values of financial instruments may result from changes in the interest
rates, credit, liquidity, and other market changes. The Company is exposed to two types of market risk as follows:

Interest Rate Risk

Interest rate risk is the risk that the future cash flows of a financial instrument will fluctuate because of changes in
market interest rates.

We are not subject to interest rate risk, because we lend to clients at fixed interest rates and for periods that may differ
from our funding sources and our borrowings i.e. subordinated debts are at fixed interest rate for different periods.

Price Risk

The Company's exposure to price risk is not material.

Operational and business risk

Operational risk is the risk of loss arising from systems failure, human error, fraud or external events. When controls
fail to operate effectively, operational risks can cause damage to reputation, have legal or regulatory implications, or
lead to financial loss. The Company cannot expect to eliminate all operational risks, but it endeavours to manage these
risks through a control framework and by monitoring and responding to potential risks. Controls include effective
segregation of duties, access, authorisation and reconciliation procedures, staff education and assessment processes,
such as the use of internal audit.

Note 46: Segment Reporting:

The Principal business of the company is financing long and medium term loans and dealing in foreign currency.
Though the company has earned income from other sources in the form of dividend on investments, interest and
profit on redemption of mutual funds, the percentage of other business income does not exceed 10% of the gross
turnover of the principal business, and as such no segment reporting has been made.

i) Capital to risk-weighted assets ratio,TIER I and TIER II has been computed on a standalone basis as
per relevant RBI guidelines.

ii) Liquidity Coverage Ratio(Highly Liquid Asset Amount(HQLA)/T otal Net Cashflow)

For Ayyar & Cherian For and on behalf of the Board of Directors

Chartered Accountants

FRN:000284S

Sd/- Sd/- Sd/-

Dijo Philip Mathew Anto Mekkattukulam Jayson T. B. Ramakrishnan

Partner Managing Director ^Director

Membership No.224930 DIN: 10528274 DIN: 10528274

>IN: 25224930BMINT G9226 _{Sd/- Sd/-}

Sujith K Ravindranath Jayasree V

Company Secretary Chief Financial Officer

Membership No.:A39757

Place: Ernakulam Place: Thrissur

Date: 27-05-2025 Date: 27-05-2025